1974-04-02

TABLING OF EXTRACT FROM MINUTES OF MEETING OF COMMISSIONERS OF INTERNAL ECONOMY CONCERNING EMPLOYEES' SALARIES

Mr. Speaker:: Order. I have the honour to lay upon the table an extract from the minutes of a meeting of the Commissioners of Internal Economy concerning revisions of the salaries of employees of the House of Commons.



ROUTINE PROCEEDINGS


Mr.   Jean-R. Roy@Timmins: Mr. Speaker, I rise under the provisions of Standing Order 43 to seek unanimous consent to present a motion on a matter of urgent and pressing necessity. Because of the grave and extensive consequences and implications that the CRTC report entitled "Radio Frequencies Are Public Property" will have on the Canadian Broadcasting Corporation and broadcasting in Canada in general I move, seconded by the hon. member for Labelle (Mr. Dupras):
That the House should refer the report in question to the Committee on Broadcasting, Films and Assistance to the Arts for its full study and recommendations, and that the CBC and CRTC should abstain from implementing the recommendations and decisions contained in the report before the committee completes its study and reports to the House of Commons.


Mr. Speaker:: This motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is not unanimity.


MARKETING OF FEED GRAINS-REQUEST FOR UNANIMOUS CONSENT TO MOVE MOTION
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I rise under the provisions of Standing Order 43 to seek unanimous consent for a motion which I consider to be urgent and pressing. In view of the opposition of thousands of prairie farmers to the proposed removal of feed grains from the jurisdiction of the Canadian Wheat Board, as well as the concern of their organizations such as the wheat pools and the National Farmers Union, I move, seconded by the hon. member for Regina-Lake Centre (Mr. Benjamin):
That this House support the principle of orderly marketing and instruct the government to maintain the Canadian Wheat Board as the sole marketing agency for feed grains.


Mr. Speaker:: The House has heard the motion of the hon. member. Pursuant to the provisions of Standing Order 43, this motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is not unanimous consent; therefore the motion cannot be put.


THE MINISTRY
Mr. Tom Cossitt (Leeds):: Mr. Speaker, I rise to ask consent of the House to propose a motion under Standing Order 43. I ask leave to move, seconded by the hon. member for Parry Sound-Muskoka (Mr. Darling):
That in the interests of the Canadian people being fully informed at all times and in order that historians may accurately record present-day events for the benefit of future generations, this House requests the Prime Minister to make a detailed statement of all arrangements or agreements that may exist between his government and the New Democratic Party which have assisted in creating the present form of coalition government in Canada.


Some hon. Members:: Oh, oh!


Mr. Speaker:: The House has heard the motion of the hon. member. Under Standing Order 43, this motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.

April 2, 1974
Oral Questions


Some hon. Members:: No.


Mr. Speaker:: There is not unanimity; therefore the motion cannot be put.


SHIPPING
Mr. Paddy Neale (Vancouver East):: Mr. Speaker, I rise under the provisions of Standing Order 43 to move a motion of urgent and pressing necessity. In view of the significant loss of employment to Canadian seamen due to the delay in implementation of a Canadian coasting trade, outlined in the government's statement of policy on September 24, 1973, I move, seconded by the hon. member for New Westminster (Mr. Leggatt):
That this House direct the Minister of Transport to introduce forthwith the Coasting Trade Act which received cabinet approval on March 14, 1974.


Mr. Speaker:: Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is not unanimous consent.


PETROLEUM ADMINISTRATION ACT
Hon. Donald S. Macdonald (Minister of Energy, Mines and Resources) moved: for leave to introduce Bill C-18, to impose a charge on the export of crude oil and certain petroleum products, to provide compensation for certain oil import costs and to regulate the price of Canadian crude oil in interprovincial and export trade.


[Stage Direction]
Motion agreed to, bill read the first time and ordered to be printed.

Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, I have a question for the Minister of Energy, Mines and Resources. In view of the statement made by

the Minister of Supply and Services indicating that in the course of meetings of the technical advisory committee that was established to advise the minister and the department about the supply of oil it became known to the Department of Energy, Mines and Resources that Canadian Fuel Marketers Limited had options to purchase a certain amount of heating fuel on the world market, would the minister tell the House very briefly how this became known and could he table what documentation exists in this matter?


Donald Stovel Macdonald: Mr. Speaker, it was through participation of the CFM representatives on the technical advisory committee.


Robert Lorne Stanfield: Since this company, Canadian Fuel Marketers Limited, and its parent, Shell Canada Limited, were both represented on the technical advisory committee, can the minister tell the House what independent checks were made of world markets, what independent checks were undertaken before the Department of Supply and Services was requested to purchase these supplies reported as being available?


Donald Stovel Macdonald: Mr. Speaker, just to correct the Leader of the Opposition, it is my understanding that CFM is a subsidiary of Shell International rather than Shell Canada. My officials made their own check of the international market, the Rotterdam and New York prices which, of course, are publicly posted prices.


PRICE PAID BY GOVERNMENT FOR HEATING OIL PURCHASED FROM ROUMANIA
Robert Lorne Stanfield: Since part of the arrangement with Canadian Fuel Marketers Limited evidently involved picking up an existing contract of that company for five million gallons of oil from Roumania, would the minister tell the House what price the government paid for that oil, specifically the Roumanian oil covered by that arrangement for five million gallons?


Donald Stovel Macdonald: Mr. Speaker, I do not have that figure with me. My recollection is that the Minister of Supply and Services indicated that he would be making public details of the individual options once they were exercised.


Robert Lorne Stanfield: Mr. Speaker, I have a supplementary question for the Minister of Supply and Services. Can the minister tell the House specifically what price the government paid or is due to pay for that oil covered by a contract for five million gallons to be purchased from Roumania?


Hon. Jean-Pierre Goyer (Minister of Supply and Services):: Mr. Speaker, we paid for Roumanian oil 99 Vi cents per gallon.


Some hon. Members:: Oh, oh!


Jean-Pierre Goyer: For Caribbean oil we paid from 60 cents to 86 cents, for an average of 79 cents altogether. I have to
April 2, 1974

explain that if we paid such a high price for the Roumanian oil it was because it was part of the agreement with his company that we could not have any Caribbean oil if we were not ready to pay this price for five million gallons of Roumanian oil.


BROKERAGE FEES PAID TO CANADIAN FUEL MARKETERS ON OIL PURCHASED BY GOVERNMENT
Mr. Harvie Andre (Calgary Centre):: Mr. Speaker, I have a supplementary question for the Minister of Supply and Services. Can the minister indicate what brokerage fees were paid to Canadian Fuel Marketers as brokers in this particular transaction?


Jean-Pierre Goyer: Mr. Speaker, actually we did not pay any fees to this company for the Caribbean oil. We paid 1 Vz per cent for the Roumanian oil. The average fee in the trade is 2 per cent, so this was a very good agreement under the then prevailing circumstances.


GASOLINE AND HOME HEATING OIL-INTENTION OF COMPANIES TO RAISE PRICE FOR REASONS OTHER THAN INCREASE IN CRUDE PRICE-GOVERNMENT POSITION
Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, may I direct a question to the Minister of Energy, Mines and Resources arising out of the fact that some oil companies have announced that they intend to raise the price of gasoline and home heating fuel by two cents a gallon for reasons other than the increase in the price of crude. What companies have informed the minister of their intention in this regard, what amount of increase do they intend to impose on the consuming public, and has the minister concurred in these decisions?


Donald Stovel Macdonald: Mr. Speaker, I have not concurred in any decision with regard to any price increase because of other costs. Perhaps I could give the hon. gentleman the details in committee this afternoon. I do not have them with me.


Thomas Clement (Tommy) Douglas: Mr. Speaker, in view of the fact the minister said last Friday, as recorded on page 980 of Hansard, that it was estimated that any such increase for reasons other than the increase in the price of crude oil ought to be in the neighbourhood of half a cent per gallon, and as the minister has said that the government does not intend to scrutinize these price increases prior to their being imposed, does this mean that the two cents per gallon increase will be permitted and that the government may look into this matter later and decide what action it will take, if any?


Donald Stovel Macdonald: Mr. Speaker, we will expect to see the facts in this regard from the companies. Of course, if there is an increase beyond that justified by the facts, the companies, in turn, would lose this in the form of compensation for offshore payments.


Thomas Clement (Tommy) Douglas: Mr. Speaker, I ask the minister frankly whether it is not apparent that, even though last Friday he assured the House that, despite statements by the oil
Oral Questions
companies that they were going to raise prices west of the Ottawa valley by 10 cents per gallon and east of the Ottawa valley by 5 cents a gallon, the increases would be only 8 cents and 3 cents, actually the increases will be 10 cents and 5 cents except that they are cutting off the dog's tail by inches rather than in one fell swoop?


Donald Stovel Macdonald: Mr. Speaker, I indicated to the House what our estimate was. Of course, the companies will have to come forward and establish the facts on which they seek to increase prices.


Mr. Speaker:: The Chair will recognize the hon. member for York-Simcoe and then the hon. member for Champlain.


Mr. Stevens:: Mr. Speaker, my question is directed to the Minister of Supply and Services and is supplementary to my leader's question. Can the minister indicate-


Mr. Speaker:: Order, please. I thought the hon. member wanted to ask a supplementary to the question asked by the hon. member for Nanaimo-Cowichan-The Islands. In fairness, I think the Chair should recognize first the hon. member for Champlain.


BILINGUALISM
Mr. Rene Matte (Champlain):: Mr. Speaker, I should like to put a question to the Prime Minister.
Since the results of the government linguistic policy are hardly satisfactory and since the findings of the annual report of the Commissioner of Official Languages are rather disappointing, is the Prime Minister considering a review of the government policy?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, in my opinion the first step would be to obtain the support of the Social Credit Party of Canada for that policy. The member is not very well placed to complain about the inefficiency of our measures, because he did not support them in due time.


René Matte: Mr. Speaker, I would like to ask the Prime Minister, who seems to blame us for something, whether he is prepared to discuss our realistic proposals made in the House, but which were not carried out even if they were practical. Since the solutions suggested by the government seem inefficient, is he prepared to consider ours?

April 2, 1974
Oral Questions


TO-DAY'S PRICK FOR FUEL OIL PURCHASED BY GOVERNMENT-KNOWLEDGE OF REPRESENTATION OF CANADIAN FUEL MARKETERS ON TECHNICAL ADVISORY COMMITTEE
Sinclair McKnight Stevens: Mr. Speaker, my supplementary question is for the Minister of Supply and Services. Can he indicate what would be today's price for the fuel oil he purchased at 9914 cents, and was he aware at the time of the purchase that Canadian Fuel Marketers were represented on the technical advisory committee?


Jean-Pierre Goyer: Mr. Speaker, to answer the hon. member's question completely, I have to state that by late November Rotterdam prices had reached 89 cents per imperial gallon. Today, Rotterdam prices are averaging 41 cents per imperial gallon. New York cargo buyers-this applies to Caribbean oil-were willing to pay 84 cents per imperial gallon in mid-December. Today, New York import prices are as low as 30 cents per imperial gallon.


Sinclair McKnight Stevens: Did the Minister of Supply and Services or his department know that Canadian Fuel Marketers were in fact represented on the technical advisory committee which the Minister of Energy, Mines and Resources indicated were the first to notify that this Roumanian option was available?


Jean-Pierre Goyer: Mr. Speaker, I cannot answer this question because I do not know the answer.


INQUIRY AS TO NEGOTIATION OF GENERAL PIPELINE AGREEMENT WITH UNITED STATES-POSITION OF PROPOSED MACKENZIE VALLEY GAS PIPELINE
Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources. Is the government of Canada currently negotiating a general pipeline agreement with the United States government? If so, what are the general outlines and objectives of that particular agreement?


Donald Stovel Macdonald: Mr. Speaker, we have had discussions with United States officials in this regard. At the moment one could not describe them as being so specific as negotiations. The Americans are currently considering their position.


William Gordon Ritchie: Will approval for the Gas Arctic pipeline by the respective regulatory agencies of the two countries be contingent on the general pipeline agreement or will it stand by itself as a separate entity?


Donald Stovel Macdonald: Mr. Speaker, I really cannot comment with regard to the federal power commission in the United States. With regard to the National Energy Board, as the hon. member knows that is covered by a statute which sets out the conditions.


EXTERNAL AFFAIRS
Mr. Claude Wagner (Saint-Hyacinthe):: Mr. Speaker, I would like to put a question to the Secretary of State for External Affairs.
Could the minister give the House the latest news concerning the fate of two Canadians, Donald Werderfort, from Calgary, and Clifford James, from Walkerton, Ontario, who have been held since Tuesday in Ethiopia by members of the Erythrean Liberation Front?


Hon. Mitchell Sharp (Secretary of State for External Affairs):: Mr. Speaker, our embassy in Addis Ababa has been in touch with the company and, of course, with the families of these two Canadians. Our understanding is that negotiations for their release are proceeding. As far as we can learn, they are in good physical condition and we are hopeful they will be released.


THE CANADIAN ECONOMY
Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, my question is for the Minister of Finance. As today's issue of Statistics Canada advises that average weekly real earnings in Canada are decreasing at an annual rate greater than 7 per cent, will the minister outline what plans he has for reversing this very disturbing trend?


Mr. Speaker:: Order, please. The hon. member is inviting the minister to make a statement which is very general in terms and normally should be made on motions. The hon. member might like to ask the question in more specific terms.


George Harris Hees: I will put it in an easier way for the minister to answer. As the organization with by far the best record of economic forecasting in Canada, the conference board, recently forecast a drop in real growth in Canada from 7.1 per cent last year to 4 per cent this year, will the minister advise the House what increase in real growth is predicted by himself and his department this year?


Hon. John N. Turner (Minister of Finance):: Mr. Speaker, I ought to remind the hon. member that, despite the high regard I have for the Institute of Qualitative Analysis of the University of Toronto, the only organization which was accurate as to the real growth of the country in 1973 was the federal Department of Finance with seven as against 7.1. As for future forecasts, that would be an appropriate subject for a budgetary speech.


George Harris Hees: Does the minister then admit that he and his department have no idea what the real growth in Canada is likely to be this year or will he make an attempt to advise the Canadian people-


Mr. Speaker:: Order, please. I think the hon. member will agree that the question is argumentative.


SUGGESTED REVIEW OF DECISION TO BUILD OIL PIPELINE FROM SARNIA TO MONTREAL
Mr. Cyril Symes (Sault Ste. Marie):: Mr. Speaker, I wish to direct a question to the Minister of Energy, Mines and Resources concerning the proposed Sarnia-Montreal pipeline. Since the extension of the existing Sarnia-Toronto pipeline could meet the immediate needs of the Montreal market and since the first leg, from Sault Ste. Marie to Montreal, of the projected all-Canadian route could meet future requirements of the Montreal market, does the minister intend to review and reassess the government's decision to go ahead with the Sarnia-Montreal pipeline? If not, why not?


Donald Stovel Macdonald: Mr. Speaker, to repeat to the hon. gentleman answers I have given him twice before, the Sarnia-Montreal extension will provide not only for part of the needs of the Montreal market in 1976 but will provide a strategic ability to expand the pipeline capacity in the event of an interruption in the future. Under those circumstances, the suggestion of the hon. member really advocates less strategic reserve for the immediate future and a delay of a prolonged nature.


Reginald Cyril Symes: Since it is estimated that the future Montreal market will involve a demand of some 500,000 barrels a day and since this is not expected to be met in the next two or three years, and since it could be met by an extension of the pipeline from Sault Ste. Marie, does the minister intend to review the whole project?


Donald Stovel Macdonald: The hon. gentleman is suggesting we should build two pipelines where one would do, and that does not seem to make sense to me.


THE CANADIAN ECONOMY
Mr. James Gillies (Don Valley):: Mr. Speaker, my question is for the Minister of Finance. Noting that recent statistics suggest that the average weekly earnings of Canadians-the earnings of people who derive most of their income from salaries-are still rising at a substantially lower rate than the rate of increase in the consumer price index, may I ask the Minister of Finance, given the fact that we have not had a budget for 14 months and given the fact that we are not promised a budget very soon, whether he has any ideas or any proposals to present to parliament soon to deal with the underlying problems of inflation?


John Napier Turner: The government has continually responded to the problems of
Oral Questions
inflation, specifically by increasing the supply of food, by increasing the capacity of the industrial sector of the country and by protecting those Canadians whose incomes are most vulnerable and who are least able to protect themselves. As to a budgetary response, that will be forthcoming when the budget is presented.


James McPhail Gillies: Given the fact that the selective price control program the government is now bringing in, backed by massive subsidies, is not working, I am wondering whether any specific measures will be introduced before the budget is brought down to deal with the problem Canadians are facing in the short run. In the long run, obviously we can cope with it, but in the short run what is the government going to do about this problem which is so serious for so many Canadians at the present time?


John Napier Turner: Mr. Speaker, if the rules allowed I could recite once again to the hon. member the series of specific measures already taken in terms of increasing disposable incomes, subsidies, reduction in personal taxes, reduction in commodity taxes and so on. But I know the rules will not allow me to expand on that aspect.


AGRICULTURE
Mr. Bill Jarvis (Perth-Wilmot):: Mr. Speaker, I have a question for the Minister of Agriculture. In light of the many speeches and statements made by the Minister of Agriculture over the past few months dealing with a long-term dairy policy, an announcement of which was to be made by April 1, and because last Friday's statement by the minister with respect to long-term policy mentioned only a consultation process between the Canadian Dairy Council and producers, is the minister prepared to make a definitive policy statement about long-term policies for the dairy industry and, if so, when may we expect to hear such a statement?


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, I am sure the hon. member is aware of the fact that we do believe in consultation, and I am sure he has read the Canadian Federation of Agriculture's brief asking for more consultation. We have a proposal to offer to these people who are concerned with the dairy industry in Canada and we are ready to proceed with it. We have directed the Canadian Dairy Commission to proceed in that fashion and we hope they will very shortly.


William Herbert Jarvis: In light of the recommendations made by various agricultural groups for a five-year dairy policy, as long ago as 1970 by the federal task force and most lately by the Food Prices Review Board, for whom I know the minister has the greatest respect, is the minister's only response to these demands to authorize the CDC to consult with producers, or does the minister have parts of a long-term policy that he can reveal to us now?

Oral Questions


Eugene Whelan: Mr. Speaker, the Canadian Dairy Commission has instructions to proceed under certain guidelines in regard to developing a policy. I have said to the House that we are going to develop a policy not for five years but for as long as there is need for a dairy industry in Canada, and a day.


GASOLINE AND FUEL OIL-IMPENDING PRICE INCREASES BY COMPANIES-CONSULTATION WITH MINISTER
Mr. Jean-Marie Boisvert (Drummond):: Mr. Speaker, I have a question for the Minister of Energy, Mines and Resources.
Can he tell the House whether the big oil companies, and more specifically Texaco Canada Limited, were in touch with him as regards the coming increase in the price of gasoline and heating oil, which increase is due to take effect as early as this coming weekend?


Donald Stovel Macdonald: Mr. Speaker, I am sorry but I did not hear all the hon. member's question; could he repeat it?


Jean-Marie Boisvert: Mr. Speaker, could the minister tell the House whether the big oil companies, and more specifically Texaco Canada Limited, got in touch with him concerning the coming increase in the cost of gasoline and heating oil, which increase is due to take effect as early as this coming weekend?


Donald Stovel Macdonald: Mr. Speaker, I must say that I had no personal contacts with those companies but the officials of my department have received communications from private companies. In this regard, as the hon. member will have noticed, a few statements were reported in the press to the effect that the companies will have to maintain prices until May 15.
With regard to Texaco in particular, I will have to study the situation with my officials after which I will be glad to report to the hon. member.


Jean-Marie Boisvert: Could the minister say what measures he has in mind to make oil companies abide by the 30-to-45-day moratorium requested by the minister in his telegram to the companies?


Donald Stovel Macdonald: Mr. Speaker, we shall take the same measures that we have been taking for the past seven months with the addition of a limitation of subsidy payments applicable in eastern Canada if oil companies do not abide by my request.


INDUSTRY
Mr. Jacques Olivier (Longueuil):: I should like to put a question to the Minister of Industry, Trade and Commerce.
Can he confirm to the House whether the United Aircraft Company, whose 5,000 employees are now on strike, complies with the terms of contracts signed by the Department of Industry, Trade and Commerce and that company, so that subcontracts may not be given to foreign firms and that the work be done in Canada?


Hon. Alastair Gillespie (Minister of Industry, Trade and Commerce):: Mr. Speaker, to the best of my knowledge the company has discharged its obligations.


ENVIRONMENTAL AFFAIRS
Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker, I should like to put a question to the Secretary of State for External Affairs relating to the agreement signed by the United States and Canada some two years ago, hopefully to clean up the Great Lakes. Now that President Nixon has either impounded or vetoed the funds voted by Congress which would have been of some assistance in this regard, is the Secretary of State for External Affairs considering making representations to Dr. Kissinger or to the President in regard to reviewing the agreement which was signed and which seems to be frustrated at this time?


Mitchell William Sharp: Mr. Speaker, it is our hope that there will shortly be a meeting to review progress under the Great Lakes agreement, at which time we will make our views known. If I meet Dr. Kissinger before that time, I will express the same views to him.


LAKE ONTARIO WATER LEVEL-SUGGESTIONS BY INTERNATIONAL JOINT COMMISSION RESPECTING CONTROL-GOVERNMENT POSITION
Lincoln MacCauley Alexander: Mr. Speaker, I have a supplementary question for the Minister of the Environment. As I understand it, the International Joint Commission, after some 10 years of study and spending some $6 million, came up with two suggestions: one was modification of the locks at Sault Ste. Marie, and the other was a further study of the St. Lawrence River system and how Lake Ontario water levels could be better controlled without flooding Montreal.


Mr. Speaker:: Would the hon. member ask his question. It would be helpful if questions, and also the replies thereto, were short, as I suggested the other day. I am sure the hon. member has now reached his question.
April 2, 1974

Oral Questions PUBLIC BUILDINGS


Lincoln MacCauley Alexander: Mr. Speaker, it is a very important question and I wanted to lay the proper groundwork. Would the minister advise the House whether these suggestions have been accepted by the Canadian government and, if not, why not?


Hon. Jack Davis (Minister of the Environment):: Mr. Speaker, in response to the question directed to the Secretary of State for External Affairs, may I say that the International Joint Commission is meeting this week and reviewing progress in respect of cleaning up the Great Lakes. In reply to the second question about the control of water levels, this is under active review in my department and also in the relevant departments in the United States.


Lincoln MacCauley Alexander: Mr. Speaker, I have one last supplementary with respect to the answer to the last question. Can the minister give the House any indication when he will be able to advise the House that a conclusion has been reached in this regard?


John (Jack) Davis: Mr. Speaker, as soon as we receive a recommendation from the International Joint Commission in the latter respect.


EXTERNAL AFFAIRS
Mr. John Harney (Scarborough West):: Mr. Speaker, I wish to direct a question to the Secretary of State for External Affairs.
In view of the fact that more than 1,500 lumbermen of the southwestern region of the province of Quebec cross the boundary each year to work in the state of Maine, where they are often poorly accommodated and fed and have no health insurance nor workmen's compensation of any kind, can the minister assure the House that the letters of intent signed in 1942 and 1958 by Canada and the United States are still-


Mr. Speaker:: Order, please. I invite the hon. member for Scarborough West as well as all other hon. members, as I have done a moment ago, to try to put their questions more succinctly. In my opinion, a question as long as this one normally calls for a long answer, and that would be an injustice towards other members who wish to ask questions.


John Paul Harney: I complete my question, Mr. Speaker.
Are these letters still in effect, and if so, what measures are taken to ensure their enforcement?


Mitchell William Sharp: Mr. Speaker, I shall have to ascertain whether these letters are still in effect and I will inform the hon. gentleman.


EDMONTON-REASON FOR REPORTED PURCHASE BY GOVERNMENT OF HOLY REDEEMER COLLEGE
Mr. Dan Hollands (Pembina):: Mr. Speaker, my question is for the Solicitor General. In view of the fact the government has reportedly purchased the Holy Redeemer College which lies on the southern outskirts of the city of Edmonton, would the minister tell the House what the government intends to do with this institution?


Mr. Speaker:: I suggest to the hon. member that this question should be on the order paper or considered at the time of adjournment.


Daniel Fulton Hollands: On a point of order, Mr. Speaker-


Mr. Speaker:: The hon. member for Pembina rises on a point of order.


Daniel Fulton Hollands: Mr. Speaker, my question is related to a matter of urgent necessity. The people in the area have written to me and to the minister's department. I sent the minister notice of the question this morning and I am sure he would want to answer it.


Mr. Speaker:: I am sure the minister would not mind replying at the time of adjournment. This is a decision that the Chair makes. This is why the rules provide that if a question is urgent it can be considered in priority at the time of adjournment on the very same day.


NATIONAL DEFENCE
Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, I have a question for the Minister of National Defence. Would the minister advise the House whether consideration has been given to lowering the troop strength ceiling of the Canadian forces to 79,000 and whether a decision has been taken? Can he also tell the House what the actual strength of the forces was during the past few weeks?


Hon. James Richardson (Minister of National Defence):: Mr. Speaker, the present strength is over 81,000. No consideration is being given currently to going down to 79,000.


Marcel Joseph Aimé Lambert: Would the minister advise whether there is applicable generally throughout the forces a six month's deferment of all requests for release by any or all ranks?


James Armstrong Richardson: No, Mr. Speaker, that is not general.

April 2, 1974
Oral Questions MULTICULTURALISM


CONSIDERATION AND IMPLEMENTATION OF RECOMMENDATIONS IN FOURTH REPORT OF STANDING COMMITTEE ON BROADCASTING, FILMS AND ASSISTANCE TO THE ARTS
Mr. Paul Yewchuk (Athabasca):: Mr. Speaker, my question is for the minister responsible for multiculturalism. Can he tell the House whether he has had an opportunity to study the fourth report of the Standing Committee on Broadcasting, Films and Assistance to the Arts which was tabled on January 7, 1974, and whether he has implemented or intends to implement any of the recommendations of that report?


Hon. Stanley Haidasz (Minister of State):: Mr. Speaker, this matter is still under active consideration by the ministers involved.


STUDY OF APPROPRIATE FORMULA FOR THIRD LANGUAGE BROADCASTING ON CBC TELEVISION
Paul Yewchuk: Mr. Speaker, I have a supplementary question to the minister responsible for multiculturalism. Can the minister inform the House whether he intends to initiate a research study in conjunction with the CBC, the CRTC and his colleague, the Secretary of State, in order to determine an appropriate formula for third language broadcasting on CBC television? Has he taken any action whatsoever in this direction?


Stanley Haidasz: Mr. Speaker, this matter is under active consideration.


CANADIAN BROADCASTING CORPORATION
Mr. Heward Grafftey (Brome-Missisquoi):: Mr. Speaker, my question is directed to the Secretary of State. Since the President of the Treasury Board stated yesterday, after the announcement by the president of the CRTC relating to the phasing-out of advertising on CBC radio and television, that the CBC did not have a high priority in anticipated government spending, what is the official government position in relation to the CRTC proposal?


Hon. James Hugh Faulkner (Secretary of State):: Mr. Speaker, I should first of all like to correct the interpretation the hon. member has put on the words of the President of the Treasury Board. What I think he said was that the CBC has neither the highest nor the lowest priority. I think that is probably a fair statement of the effect of what he said. I am still reading the CRTC report.


William Heward Grafftey: Did officials of the CRTC consult the government or officials of the CBC about the financial implications of the CRTC proposal prior to it being made public?


James Hugh Faulkner: They did not consult me, Mr. Speaker.


TERMS OF AGREEMENT WITH RAILWAYS IF ADDITIONAL HOPPER CARS PURCHASED BY GOVERNMENT
Mr. Doug Neil (Moose Jaw):: Mr. Speaker, my question is for the minister in charge of the Wheat Board. In view of the recent statement on the weekend to the effect that the government intends to purchase an additional 4,000 grain hopper cars, will he advise whether these hopper cars will be covered by an agreement similar to the one the government now has with the CNR and CPR which in effect gives 2,000 hopper cars to the railways to use in return for keeping them in repair?


Hon. Otto E. Lang (Minister of Justice):: Mr. Speaker, the existing agreement covers only 2,000 hopper cars, and a new agreement will be required for the next set of cars.


Douglas Charles Neil: Would the minister then admit that the effect of the agreement is to give a subsidy to the railway companies of some $45 million?


Mr. Speaker:: Order, please. Of course, that is argument and a question asked in those terms is not in order.


INDUSTRY
Charles Patrick (Paddy) Neale: Mr. Speaker, I have a question for the Minister of Industry, Trade and Commerce. In light of the projected takeover of de Havilland Aircraft in Toronto by the department, for which an additional $28.8 million appears in the estimates for 1974-75, will he assure the House that adequate safeguards have been secured to ensure that the various component parts for the STOL aircraft will continue to be manufactured in Canada and, in particular, the PT-6 engine produced solely in Canada by United Aircraft at Longueuil, Quebec?


Alastair William Gillespie: Mr. Speaker, the hon. member is referring to the option the government has which must be exercised by the end of June of this year. It was taken at the time we entered into a major funding arrangement for the STOL aircraft. For the information of the hon. member and the House, no decision has been taken by the government on whether that option will be exercised.


REPORTED INTENTION OF UNITED AIRCRAFT TO MOVE OPERATIONS TO UNITED STATES-ACTION TO PREVENT LOSS OF JOBS
Charles Patrick (Paddy) Neale: Mr. Speaker, my supplementary is again directed to the Minister of Industry, Trade and Commerce. In light of recent reports in the Montreal Gazette that United Aircraft is threatening to move its operations to the United States, what action is the minister prepared to take to prevent the loss of jobs to Canadians by the contracting out of the manufacture of
April 2, 1974

various component parts of the engine by United Aircraft of Canada Limited to factories of the parent corporation in the United States?


Alastair William Gillespie: Mr. Speaker, we have been in consultation with the company. We are following the events of this regrettable strike very carefully and closely. I have no reason to suppose there is going to be any problem such as the hon. member has suggested.


NATIONAL DEFENCE
Mr. Jack Marshall (Humber-St. George's-St. Barbe):: Mr. Speaker, my question is supplementary to the question asked by the hon. member for Edmonton West of the Minister of National Defence. In view of the fact the minister indicated there would be a doubling of air force reserves, that they would be given more responsible tasks and that new squadrons would be formed, would he also indicate whether consideration is being given to assigning to them the role of surveillance of our fisheries on the east coast, specifically Newfoundland?


James Armstrong Richardson: Mr. Speaker, it is correct that we are planning to double the strength of the air reserve and we will be creating new air reserve squadrons. The location of the new squadrons will depend to some extent on the availability of experienced ex-service and other personnel who can take part in the air reserve, but certainly there are personnel in that category on the east coast and we will give serious consideration to the establishment of a new squadron there.


PROPOSED TORONTO DISTRICT HEATING STUDY INVOLVING USE OF WASTE-REQUEST FOR FINANCIAL ASSISTANCE
Mr. Jim Fleming (York West):: Mr. Speaker, my question is directed to the Minister of Energy, Mines and Resources. In view of the announcement yesterday by the mayor of the city of Toronto of a Toronto district heating study on the use of waste to produce energy, will the federal government give prompt consideration to financial aid to this extremely important project for our community?


Donald Stovel Macdonald: Mr. Speaker, my department has done an evaluation of the proposal. The initial response is positive and we will do a more fundamental one. I have indicated to my colleague, the Minister of State for Urban Affairs, that this would be a very good subject for one of the demonstration projects under his new allocation of $100 million.
Oral Questions


ADMINISTRATION OF JUSTICE
Mr. Ian Arrol (York East):: Mr. Speaker, my question is for the Minister of Justice. In view of the stated desire of the Minister of Manpower and Immigration to have steps taken to discourage criminal elements from other countries from carrying on their criminal activities in Canada, when is the minister planning to introduce legislation which will make it a criminal offence for persons who, once deported, re-enter Canada of their own volition?


Otto Emil Lang: Very soon, Mr. Speaker.


AGRICULTURE
Mr. Leonel Beaudoin (Richmond):: Mr. Speaker, I direct my question to the Minister of Agriculture.
Answering a question asked by the hon. member for Prince Albert yesterday as to the amount of beef and veal imported in Canada, the Secretary of State said that we have imported one million pounds of veal a month between July and December 1973. Can the Minister of Agriculture say whether he will meet with his colleague, the Minister of Industry, Trade, and Commerce, with a view to reducing those importations which I term as dreadful in order to help Canadian meat producers?


Eugene Whelan: Mr. Speaker, I have in front of me a whole book full of information on imports and exports of beef cattle which I can lend to the hon. member if he wants to read it. He will find that our imports and exports are not that much out of balance as some would like us to believe in comparison with some other years. Mr. Speaker-


Mr. Speaker:: Order, please. I remind hon. members that we are running short of time. Perhaps the minister might be deemed to have answered the question.


DISCUSSIONS ON POSSIBLE FINANCIAL ASSISTANCE TO SHEEP RAISERS
Mr. F. Oberle (Prince George-Peace River):: Mr. Speaker, my question is a supplementary to the Minister of Agriculture. Are he and his officials carrying on active discussions with the sheep farmers of Canada in an attempt to work out an agreement similar to that in respect of the cattle industry in order to assist them in the dire straits they are facing?


Eugene Whelan: Mr. Speaker, I would say that the sheep raisers association presented a brief several days ago or a couple of weeks ago asking us to participate in a program to try to encourage

April 2, 1974
Oral Questions
greater sheep production in Canada. We are considering that brief and we will be in further consultation with them later.


IMPORTS OF BEEF INTO CANADA IN JANUARY, FEBRUARY AND MARCH, 1974
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, the Minister of Agriculture says he has all kinds of statistics in front of him. This question was asked yesterday by me and answered by the Parliamentary Secretary to the Minister of Industry, Trade and Commerce. It had to do with imports of beef into Canada since last July 1. I ask the Minister of Industry, Trade and Commerce whether this answer was true, that the department has no information on imports of beef for January, February and March of this year, or was it a cover-up?


Alastair William Gillespie: Mr. Speaker, 1 was not in the House when the hon. member asked that question.


John George Diefenbaker: That is a frivolous way of answering the question-


Mr. Speaker:: Order, please.


John George Diefenbaker: -or not answering. I am not to be brushed off with that kind of stuff.


Mr. Speaker:: Order, please. We will attempt to settle this difficulty with supplementaries from the right hon. member, and questions from-

-the hon. member for Lotbiniere, the hon. member for Richmond; afterwards I will call orders of the day. The hon. member for Prince Albert has the floor.


John George Diefenbaker: Mr. Speaker, surely the minister does not assert that his department is four months behind in statistics respecting imports of beef from the United States and other places. If he does, it is about time that he transferred some of these other officials from other departments in order to have a sufficient number of them to give information to the House. It is a cover-up.


Mr. Fortin:: Mr. Speaker-


Mr. Speaker:: I apologize to the hon. member for Lotbiniere, but the hon. member for Northumberland-Durham rises on a point of order.


Mr. Lawrence:: Mr. Speaker, my point of order is simply this. The Minister of Agriculture has offered to show this book of speech material which he has at hand to any member who requests it. I am now formally asking him to send the book over so that we can see it.


Mr. Speaker:: Order, please. I am sure the hon. member must have some doubts as to some procedural aspects of the request he is making now. I hope the minister will not 
attempt to walk across the floor to give the book to the hon. member who is asking for it.

The hon. member for Lotbiniere wants to ask a supplementary. I will recognize him and then call orders of the day.


REFUSAL OF BEEF SUBSIDY ON ANIMALS FROM DAIRY HERDS
André-Gilles Fortin: Mr. Speaker, I wish to direct a question to the Minister of Agriculture.
In view of the fact that, on the one hand, 622 million pounds of beef have been imported and that, on the other hand, tens of beef producers in Lotbiniere constituency have seen their applications for beef production subsidies turned down on a mere legal technicality, this meat coming from dairy herds, can the minister advise the House whether or not he will review this decision and correct this anomaly, so that all Quebecers and other Canadians may be treated as well as foreigners when the time comes to supply the needs of Canadians?


Mr. Speaker:: I am under the impression that this question has already been asked. However, the hon. minister may care to answer it for a second or a third time.


Eugene Whelan: Mr. Speaker, total Canadian exports and imports of beef-I could go on and give all kinds of figures, but I just want to say this-


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please.


George Harris Hees: Just send the book over, Gene.


John George Diefenbaker: The answer was false.


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. I think this would be a good time to call orders of the day.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Monday, April 1, consideration of Bill C-5, to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways system and Air Canada for the period from the 1st day of January, 1973 to the 30th day of June, 1974, and to authorize the guarantee by Her Majesty of certain
[Stage Direction]

:|

April 2, 1974
[Stage Direction]
securities to be issued by the Canadian National Railway Company and certain debentures to be issued by Air Canada, as reported (with amendments) from the Standing Committee on Transport and Communications, and motions Nos. 1 and 2 (Mr. Blenkarn).
Mr. A. P. Gleave (Saskatoon-Biggar):: Mr. Speaker, when I spoke last evening before the time of adjournment I mentioned the matter of telecommunications. I spoke of the availability of service if one wished to send a wire or to communicate with another city by wire out of the city of Saskatoon. My experience, when I wished to send a wire from Saskatoon on a Sunday, was that I was advised by a recording device that I should dial a certain telephone number in Winnipeg. What happens when you get Winnipeg on that particular telephone number I did not bother to find out. I did what seemed to me to be logical, namely, I simply used the long distance telephone. Somebody says that I could have used a carrier pigeon. There was a time when that was a fairly dependable method of communication, but unfortunately now I do not think we have a thoroughly efficient method of communicating. It seems to me that the railroads have reduced their level of efficiency to the point where they no longer adequately serve the public.
Setting up the new telecommunications system was supposed to be a move forward. The two railroads in combination were supposed to set up a joint system which, it was supposed by the public and supposed generally, would be a more effective and cheaper method for Canadians to communicate by wire from one point in Canada to another. This system could be used effectively for a number of services which cannot readily be carried out by wire. The Canadian Transport Commission, which is supposed to oversee these kinds of services, should ensure that they serve Canadians adequately, but I suspect that it is simply not doing its job and not ensuring that the proper service is provided. I think this is the situation in which we find ourselves now.
I hear no declared intention by the government to overhaul the commission and to give it the kind of supervisory role that it should have. Instead, we get apologies for the kind of service that is being given or is not being given. Apparently the Minister of Transport (Mr. Marchand) and the Minister of Justice (Mr. Lang) share the responsibility between them, and we hope that in time when this matter is under discussion they will give some indication of whether or not the government intends to discard its responsibility in respect of transport in this country. We must not forget that transport and communications are two of the most vital services in this country. I suppose we will just have to wait and see what the government's attitude in this respect will be. We have been waiting for a long time and we have not seen very much. I hope that some real improvement can be made in communications so that every region of Canada is served as well as are Montreal and Toronto.
It might really help if we could move the head offices of the CNR out of Montreal and locate them in Regina or Calgary. Maybe then they would realize that the people who live there need service. Then they would know there is a northerly part of Canada that needs some service. It would get them out of the attitude which they have now,
Canadian National Railways and Air Canada which is that everything revolves around Montreal and Toronto and the so-called Golden Triangle. Let them find out that there are other parts of Canada that need service, and indeed are willing to pay for it.
It is a shocking thing that the CNR in Saskatoon, in an area which was first served by that railroad, is now attempting to give it as little service as possible which is a rather stingy approach.


Mr. Norval Horner (Battleford-Kindersley):: I am
pleased to speak on the CN financing bill, Mr. Speaker. If anyone ever needed financing, it is certainly the CNR. I am concerned about the area in which they are choosing to spend money. In the west the railroads are being neglected. Evidence of that is the number of accidents on tracks in the west and certainly the number of crews that look after and tend the railways comprise fewer and fewer people all the time.
Many of the problems that have been experienced this winter are the result of the railways not looking after the tracks. Anyone can drive down a highway in Saskatchewan-the highways are parallel to the tracks-and can see that the snow fences have not been repaired for five years. This particular winter the snow has been no worse than a lot of winters we have had, but because the railways have neglected the snow fences, and neglected to cut down the shrubs along the tracks, the problem has been much more acute. These facts will fit seemingly into a plan which the minister in charge of the Wheat Board has for closing a lot of spur lines, saving the railways a lot of money and putting the cost, instead, on the backs of the farmers who are trying to get grain to market.
Another area in which the railways didn't have enough money was to provide double deck cars to the shippers of calves from the prairies. A lot of the buyers in western Canada made arrangements with the railways to equip cars themselves. They took the cars and made double deckers out of them. A plate was placed on each car so it could be used over and over again. The problem again was that it took the railways several days to move the cars from North Battleford to Toronto and took them three weeks to return the empty cars. No records were broken there. It was just another example of the railways not providing service to the west.
Last Saturday in Estevan the minister responsible for the Wheat Board announced the purchase of 4,000 cars. He didn't really announce their purchase-he said the government was prepared to purchase them some time. There was no date given for the expected delivery. No mention was made of any contracts given to build the cars, but some time in the distant future we are going to have some more hopper cars for the delivery of grain. There was no mention of any agreement in regard to maintenance, rental, or any form of reimbursement by the railways. It was just a sort of loose gift to the people who haul grain, in the form of hopper cars.
The minister responsible for the Wheat Board prefers to make announcements out in the country. He was asked by the hon. member for Red Deer (Mr. Towers) specifically last Friday what the government's plans were with regard
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Canadian National Railways and Air Canada to hopper cars. He didn't know. He preferred not to answer. The next day he received a revelation. I do not know whether he talked to the cabinet or found his notes, but he was able to be much more specific in Estevan. This further shows the minister's contempt for this House and for the members who sit opposite him.


Mr. Speaker:: Order, please. I apologize to the hon. member if I interrupt him, but I think I have to remind the hon. member who has the floor, and all hon. members who want to take part in this debate, that there is a rule of relevancy which is essential to parliamentary debate.
We have before us motions Nos. 1 and 2. This bill is not before us on second reading or third reading. We are not considering a general amendment. These are not very general motions, but very specific motions. While I appreciate that hon. members in the course of the debate yesterday did not necessarily follow the rule very closely and strayed considerably from the principle of the motions now before us, I think an effort should be made by hon. members to try to relate their remarks at one point or another to these motions.
I have not intervened until now because the hon. member is entitled to some latitude in that many of his remarks could be considered introductory to what he will say later on, but there is a responsibility on the part of hon. members themselves to remember that they should relate their remarks to the motion before the House. This is elementary. The Chair cannot intervene all the time. It has to rely on the co-operation of hon. members and their respect for a well-established and fundamental rule.
I am sure that eventually the hon. member, after he has completed his general remarks, will allude some time in some way to the question now before us.


Norval Alic Horner: Thank you, Mr. Speaker. The bill is related to the financing of CN expenditures, and I was simply pointing out there were a lot of areas in which the CNR should be spending money rather than to build a CN tower in Toronto and other places like that. I was referring to the minister responsible for the Wheat Board. He makes direct comment on the money that could be saved in the west. I suppose he would like to spend the money that he wants to save the railways in the west in Toronto, or other places in the east, and I did feel that my remarks were related to the motions before the House.


Mr. Speaker:: I want to be fair to the hon. member. I certainly did not want to suggest that he should end his remarks at this point. I was merely suggesting to the hon. member that perhaps he might, after he had continued his introductory remarks, relate them to the motion before us. I think it would be unfair to the hon. member for Battleford-Kindersley to limit him much more than others have been limited. I am anxious to be fair to the hon. member for Battleford-Kindersley. I hope that he has not misconstrued the words that I spoke a moment ago which related not only to his remarks but to all of the remarks made by hon. members in connection with this debate while we have before us motions Nos. 1 and 2.


Norval Alic Horner: Not at all, Mr. Speaker. I was just about to conclude my remarks anyway.


Mr. Frank Hamilton (Swift Current-Maple Creek):: Mr. Speaker, I appreciate the opportunity to say a few words on the amendments to Bill C-5, which deals with Canadian National financing. These amendments, of course, stand in the name of my colleague, the hon. member for Mississauga (Mr. Blenkarn), suggesting the deletion of some $5 million for hotels and $8 million for a tower in Toronto. By any railway standards these are not large capital expenditures. However, they are very disturbing as they indicate the general direction or thrust of the government's transportation agency, the Canadian National Railways.
In western Canada, we spend all of our time trying to build the economy and we do not like to see things torn down. The roots of our present economic status go as far back as confederation and the building of the railways. Mr. Speaker, I should like to quote from the report of the Canadian Transport Commission for 1973. On page 1 of the report this statement appears:
Payments to the railways in compensation for the uneconomic services they are required to operate in the public interest rose to $125,500,000 from $81,800,000 because of an increase in the number of services qualifying for payment-
On page 2, this statement appears:
The payment is 100 per cent of the actual loss on branch lines, and up to 80 per cent of the actual loss on passenger train services ...
In addition, the commission through a continuing process of verification and further uneconomic findings certified and paid an additional $17 million on 1969-71 claims.
This technique of subsidies is a favourite tool of this government and it has been proven wrong time and again. Subsidies have failed to persuade the subsidized group to act in the public interest. All they have produced have been demands for further subsidies. Subsidization is a weak-minded substitute for rationalization of the area concerned, in this case, transportation. The subsidies are only a delaying tactic. For the minister to say that he lacks power to cope with the transportation problem is hogwash. The federal government has the power to regulate every aspect of interprovincial transport. Statutory freight rates for grain exist, and they will not be changed in spite of what is said by the minister in charge of the Wheat Board. Nor should they be changed while the railways receive some $1,500 per mile subsidy every year on western branch lines.
Some mention has been made in this debate of the sale of a Canadian National hotel, the Bessborough hotel in Saskatoon, which has been bought by private interests. I think that is a good indication of what happens when private enterprise comes up against public control. I know which of the two I would sooner have running my business.
I wonder if anyone really knows what is going on in our whole transportation system? It seems to me that the government has lost control of everything. They are now talking of purchasing hopper cars but have not told farmers that the Canadian Wheat Board has had to reduce its
April 2, 1974

estimate of return to producers for the 1973 crop year to $4.79 per bushel from $4.93 last September. We all realize that the present selling price is $5.84 at Thunder Bay and $6 at Vancouver and wonder where the missing $1.25 has gone. I suspect that a good part of it has gone to transportation or the lack of it, in the prairies. We are talking about some $13 million, for these two items, a luxury hotel and a 1,000 foot tower. That is a lot of money to the people in my area.
In the subdivision in which I deliver grain there has been an average of one railway tie replaced every 35 miles of track in the last few years. The speed limit is 20 miles an hour, and in certain areas, ten miles an hour. Talk about "holy crow"-about all this track would stand right now is a good sized crow walking down it. We have had cases of the Canadian National abandoning elevators- Burnham to be specific-without permission from the CTC. We find now that there are 23 Canadian National lines out of commission in western Canada because of lack of equipment to clear the tracks properly. Look at the tremendous amounts paid by way of subsidy for the two main line passenger trains, The Canadian and The Supercontinental. It is $140,000 every day of the year. One could charter a jumbo jet and fly people across the country for less than that.
There has not been much mention of various transportation systems around the world, Mr. Speaker. I wish people would look at the Red Arrow which runs from Moscow to Leningrad, a beautiful electrified line; the Tokaido line in Japan which runs more passengers every day from Osaka to Tokyo than we haul in a year; the beautiful TEE trains of Europe and the Blue train of South Africa. Mr. Speaker, I do not agree with everything South Africa does, but I can tell you those Dutchmen run a tight ship. They have a law there which decrees that goods cannot be moved more than 25 miles by truck and so they force freight to move by railway. Surely, some of these ideas could be used to improve our transportation system.
The minister says that he has no transportation policy, and I agree. I look at this expenditure of $13 million for luxury hotels and towers in light of the situation that faces my particular area. The last date on which a train ran through our subdivision was February 25, and the next one is expected on June 15! We would like to see a rebuilding program indicating that the government has some confidence in the future of our country rather than being faced with an abandonment program. As transportation needs increase, we see the government allowing railways to decline.
The Globe and Mail today states that freight revenue for the week ending March 21 declined 4.9 per cent from last year; car loadings are down by 2.2 per cent for the whole year and to date both are down by 1.2 per cent. What we need here is some good commonsense. We need to knock a few heads together so this transportation system will get on with the job of moving goods and people, not necessarily in the most efficient manner but certainly in the most effective manner for the general advantage of the country.


André-Gilles Fortin: Mr. Speaker, I want to speak very briefly on Bill C-5, an Act to authorize the provision of moneys to meet certain capital expenditures
Canadian National Railways and Air Canada of the Canadian National Railways System and Air Canada for the period from the 1st day of January, 1973, to the 30th day of June, 1974, and particularly on the motions before us which one might say come directly to grips with the very essence of this bill, that is the method of financing of the Canadian National Railways.
One proposal made in motion No. 1 would seek to change $225 million to $211 million or something very close to that. It is somewhat the same kind of proposition as expressed in motion No. 2.
Mr. Speaker, my remarks will be aimed precisely at the principle of that method of financing. The federal government through the Department of Transport is still using the same method as used in previous years and introduced a bill to finance the publicly-owned Canadian National Railways. Put in those terms, the question is relatively simple. In principle, one could not object to voting budget items of any amount, even with reference to motion No. 1.
I find it strange, Mr. Speaker, that one cannot oppose the voting of items by this House to finance a national public transportation system in Canada which is a public service intended to serve the interests of the Canadian public for the public weal. On the other hand, from the administrative or financial point of view, the matter is not all that simple. To work with a view to serving the interest of the public weal means not only, for example, providing essential transportation services at all times for the benefit of the people of this country but also that the cost of setting up and maintaining those services should not be too onerous to the point of making it prohibitive in some cases.
That is the situation as I see it now, and it is on that second point that I would like to draw the attention of my colleagues on both sides of the House. The motions before us which will be put to a vote, tackle the very basis of the bill. Bill C-5 says that the Canadian Railways System needs are as follows; road property, a subsidy of $138,978,000; branch lines, $13 million; equipment, $31 million; telecommunications, $25,946,000; and for hotels, $5,679,000, for the C.N. Tower Limited, a sum of $8,800,000 and finally for investment in affiliated companies, $1,200,000, making a total of $225,500,000. This motion aims at reducing this amount to $211,021,000.
Mr. Speaker, what will be changed? What I am concerned about is not the fact that the cost will be $225 million or $211 million, but I am concerned first of all about the principle allowing such an expenditure and then, the service the people are entitled to if we vote this sum of money.
What is still more serious is that since the establishment of the CNR, the same financing procedure exists, that is corporations such as the CNR are financed through subsidies. What is a subsidy? It is the taxpayers' money, the taxes administered by the Department of Finance and voted by the House of Commons for the maintenance and administration of the company.
Moreover, how are the nationalized transportation companies financed. Through the consent granted by the House of Commons and the passage of a bill enabling
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Canadian National Railways and Air Canada them to borrow, that is they are granted the power to borrow on the Canadian and foreign markets.
In the bill, no reference is made to the interest rates nor to previous bonds of those companies. We are asked to give them a blank cheque so that they may borrow.
How will those companies reimburse those loans that we shall allow them to make by adopting one or the other of these motions or the bill itself, since in either case there is coercion? These loans will be reimbursed next year by means of a new bill, written in the same style as this one. We shall again vote a subsidy, which will be a bit larger because of the interest to be reimbursed, and once again next year, as two or five years ago, these companies will be allowed to borrow to increase their debt so that they may develop.
Mr. Speaker, there are two kinds of socialism adepts in this House. Some are disguised, those of the Liberal government, some are true socialists, those in front of me. The latter say: let us place the railways and transportation companies of Canada under public ownership.
They tell us: once they are under public ownership, we shall be able to control our own destiny in the field of transportation. But they do not say, Mr. Speaker, that we will control our own destiny by borrowing from foreign sources, by putting the Canadian people in debt, and by increasing taxes to reimburse these loans and pay these subsidies to the companies, with the result that we shall not be the ones to control the Canadian transportation system uniting the eastern and western parts of the country, those in control will be the foreigners and those who have financed these companies.
Mr. Speaker, this is a statement of fact. The Minister of Transport (Mr. Marchand) or the Minister of Finance (Mr. Turner) are quite unable because of their intellectual integrity to say the opposite. It is easy to use big words and say: We shall be able to control our own destiny, we shall control such a field, we shall place companies under public ownership.
The people who say this, who use these fine words in front of the population, come before Parliament and, as Minister of Finance, Minister of Transport, or leader of the New Democratic Party, tell us: Let us now vote welfare subsidies to control our own destiny, to finance the operation of the companies which we control.
Secondly, let us give them the permission, a kind of blank to borrow and to enable foreigners to systematically control these companies. I feel it is more and more imperative, Mr. Speaker, to control these companies.
Canadians no longer control them. Neither is it Parliament whose only task is to vote subsidies since the minister, finally, because of the Crown companies' constitution, is not really responsible to the House.
Mr. Speaker, we are deluding ourselves if we think that we can endow Canada with a real national transportation system, connecting the two opposite coastlines and enabling Canadians from the east, the west, the Maritimes and central Canada to exchange goods as well as friendly feelings.
Old people in Montreal have been requesting with great publicity and support the privilege of paying less than

others because of their insufficient income but they are scoffed at.
Ottawa replies that for that category of people it has no money to make it easier for them to avail themselves of means of transport.
The transportation system has become so expensive in Canada that we must now face a problem of access concerning certain groups of Canadians.
Provincial governments state: "We may not look into this; this is federal jurisdiction". Meanwhile, Mr. Speaker, senior citizens will have to keep on waiting before they can benefit from public transportation and other transportation systems under the jurisdiction of the department of Transport. These same citizens, even if they have a small income, will have to keep on paying taxes in order to subsidize these firms which do not belong to us anymore.
Mr. Speaker, those were the only comments that I wished to make on this. I think that it is pointless to enlarge on this subject, to repeat the same thing for the hundredth time. Anyhow, the Minister does not understand anything and he is not even in the House. What matters is that this be recorded, so that the government as well as elected members of the New Democratic Party know that taking over a firm with capital that do not belong to us does not make that firm ours but gives it to the people who have the capital.
Moreover, how can we be proud of the lousy transportation system we have now, a system which operates on crutches because it does not belong to us and because we must subsidize it the way we subsidize people on social welfare.
Finally, we suddenly realize today that the railway system which was built in Canada, supposedly to unite all Canadians from the Atlantic to the Pacific and foster Canadian unity, is a complete failure. Actually, most railway lines are closed and the railway companies cannot, in an adequate and technically modern way, provide the necessary services and transport products from one place to another. They are unable to transport the wheat which we have in Western Canada to Eastern Canada where it is needed. They are unable to transport the milk which is produced in Eastern Canada to Western Canada and elsewhere where it is needed. Beef which may be in demand in one part of the country is lacking in the other. What is the government doing about this? The minister has not been courageous enough to reply today. That is why they say to Quebec producers: Tighten your belts! They refuse to subsidize them while they import 622 million pounds of beef from foreign countries!
Our transport system which is costing $225 million to the taxpayers will be used for what? To pay the interest on our debt!
In Canada there are still some people who prefer to live with inflation in their small corner of the country. Some people do not feel at home in Canada because they cannot benefit by all the advantages offered by all the regions of the country. For some Canadians it is difficult to use our transport system because it is too costly. For them, it is prohibitive. Some Canadians have to tighten their belt whereas we could produce three times as much as they need, such as wheat, beef, milk and many other products.
April 2, 1974

And at the same time their belts are being tightened. We are importing from abroad while we are told that we have a national unity, that we have it good in Canada and that we have a good transportation system.
I am revolted by the fact that Canadians facing hardships have in Parliament some allied so little informed on Canadian problems as the Liberals who are maintaining this division system among Canadians to better control them. One of the best ways to unite a country is through a transportation system.
We have one agriculture policy in the West, another one in the central provinces and a third one in the Eastern provinces. In any field we have the same situation. Why? Because the House of Commons has no overall view of the country and even more serious, we are presented with patchwork policies. A small problem is settled in the West, another one in the East and finally we keep on subsidizing, through social welfare benefits, a number of organizations which do not even render human and reasonable services, namely our railway companies.
Mr. Speaker, these same companies do not even respect the concept of bilingualism about which they speak fine words and involved sentences.
Mr. Speaker, I should object to this bill. Indeed, even if I represent only a very small area, I refuse to associate my name to a government which will contribute through such measures to get me and all my fellow citizens deeper into debt and to aggravate Canada's divisions.
I would rather support a measure designed to give us an efficient transportation system in Canada, from which all Canadians can benefit while feeling that we are all brothers in Canada.
Then, Mr. Speaker, Canadians will be proud to finance a railroad because it will give them something. But neither the Minister of Transport (Mr. Marchand) nor the Minister of Finance (Mr. Turner) is in a position to prove, in any way, that Canadians will benefit from this bill. All it will do is enable certain brokers, financiers to put money in their pockets through loans, loan guarantees, subsidies, while maintaining in existence a service that is as inadequate as it was five years ago. Mr. Speaker, I find this absolutely ridiculous. That is why I refuse to take up any more of the time of the House discussing a bill of such secondary importance.


Mr. S. J. Korchinski (Mackenzie):: Mr. Speaker, I want to say a few words at this time because of the mess that transportation is in today. The amendment offered by the hon. member for Mississauga (Mr. Blenkarn) is an attempt to point out the frivolous way in which money is being wasted. Parliament and the people of Canada are being asked to finance efforts by CNR management that are not entirely essential. These efforts could best be handled by other organizations. Other people could concentrate on building these hotels, towers and the like. The hon. member's amendment is an attempt to put the railways back on the tracks, so to speak.
One has a tendency to forget the initial intent and purpose of our railways. They were originally intended to
Canadian National Railways and Air Canada serve the needs of our country. The situation is the same in many other areas, such as the Unemployment Insurance Act. Although that act was originally intented to provide insurance for those who may become unemployed, it has become a welfare scheme. The railways suddenly want to be big. They want a status symbol. They want to affix their names to something in bold letters decorated with maple leaves here and there. They want a big CN sign which towers above everything else so that people will point to it and say that is operated by CN. However, what is the price? They have beautiful, plush and expensive hotels, but they are not making money. We have to pay a price for that.
We have to pay a price because transportation is being neglected. This is why I am so saddened by the attempt of management to move into another area. I would be the first to agree with this move if the management people were of such a calibre that they could run a railway system which would bring in some revenue for the people of Canada and not result in the Minister of Transport (Mr. Marchand) throwing up his hands in disgust. The minister says he has no power. If the Minister of Transport does not have the power to run the transportation system of this country, he has no business introducing a bill that will provide money to run a hotel system. No minister should venture into another area if the narrow area to which he is confined is not being looked after.
Among the many difficulties that we have is the fact that the railways are abandoning many small communities through a systematic method. They move a car into a terminal point, then move the freight by truck from that point to its destination. That is the first step in abandonment. They want to get out of this business. If the Department of Transport does not want to deal with transport, then what department of government should deal with it? The department is not dealing with transport. It is in the tourist business. That should be run by another department, perhaps Indian Affairs. Surely, another department or a minister without portfolio should be handling the tourist business.
Parliament is being asked to finance the railway with hard-earned tax dollars. This bill is being presented in April which is income tax time. People are being asked to submit their tax money willingly for something which is of doubtful benefit. It is not as though there would not be any hotels in our cities if CN did not operate them. If any place did not have a hotel, it would not be long until one was built. It is not as though the Canadian public would be without hotel service. However, where do the people in my constituency go to ask for a train that will at least put a car on a siding?
I wish to cite an example. There are a couple of cars which many farmers are hard pressed to get, but they cannot be moved 30 miles from the town of Hudson Bay to Somme to be spotted on a siding. It is too much trouble for the railway to remove the snow from the track. Mr. Speaker, every second house in the city has a snowblower. We could soon clear the track if they don't know how to do it. We all know the CNR could do it if they set their minds to it, but their only purpose is to get out of the railway business except for operating a straight run-through like

Canadian National Railways and Air Canada the trans-continental, in which case, where would the traffic come from?
Instead of concentrating on their proper business, such as supplying cars and locomotive power, officials of the company go about making speeches. They say the Crows-nest Pass Agreement is what is tying them up. How ridiculous! When we look at the figures, we find that despite the terms of the Crowsnest Pass Agreement the years in which most grain was moved were the years in which the CN either made higher profits or incurred smaller losses. Instead of financing hotels, maybe the CN should write off some of the old debts they have been complaining about. I would be far more responsive if the company came up with a proposal for writing off these old debts which burden the balance sheet with interest charges. This would appeal to me more than the idea of voting money which will not produce anything, really, except for one element they think is essential to their own self-elevation, namely, prestige. They like to say: We have bought hotels; we are a big company controlling all kinds of enterprises; we have built a tower-where else in the world can you find a tower like that, and where else in the world do you find such posh hotels?
Just think of the money which is going to be spent on such items as the silly ashtrays in these places. We could spend less and get some of those box cars out of the smaller communities; it would not take much money to move that snow off the tracks. The company is no longer concentrating on its original purpose, and that is what disturbs me. I have before me a brief from the farmers' union including a long list of cars which have been left on sidings for a month at a time. Nobody in management seems to know how to get those cars out, how to move the grain to the west coast.
How much money is involved in all this? I have seen figures estimating the loss to Canada at between $500 million and $700 million. But take the lower figure. It is $500 million that this country could earn, and it is $500 million that these hotels will never earn. The opportunity to earn this money may not come back again. Observe the way in which prices are fluctuating. Take the price of rapeseed. Buyers can no longer place any faith in Canadian deliveries. The transportation system cannot deliver, and if you cannot deliver you cannot sell. The price of rapeseed dropped $2 a bushel last month, and that in itself is bound to affect the Canadian economy.
Why have all these difficulties arisen? It is because one minister after another has been content to pass the buck. I do not know when this Minister of Transport intends to resign, but he had better make up his mind quickly because if he sits around for another six months before resigning we shall have lost another six months. I do not care whether we are trying to move lumber, grain, minerals or anything else. It has to be delivered. Ships will not continue to wait indefinitely in Canadian ports. Why should they? The world is wide, and the world is not idle. There are people who want to work and who are able to produce; they have products to sell, and pretty soon we may find ourselves sitting on a lot of commodities we do not know what to do with. We shall be wondering what hit us, wondering how we shall cope with inflation and the
[Mr. Korchinski.)
April 2, 1974
other problems which face us. Maybe we shall try to persuade ourselves that because Canada is such a big country everything will work itself out. I do not believe it.
I think we should face up to the difficulties we are discussing this afternoon and, for once, deny some of these grandiose ideas in the hope that the people concerned will decide to concentrate on the matter in hand. I am not convinced they will ever concentrate if we keep giving them money.
The other day, someone on the CRTC said the CBC could get along with less advertising. That will mean more money to be raised from taxes. Apparently parliament is ever willing to put out this kind of money for entertainment, to make sure that viewers do not have to put up with a break in the movie because a commercial is being shown for a few seconds. Why, then, should we need to worry about money around here, some may ask. I maintain we should put our money into areas which will ensure efficient transportation in order that the whole country may benefit. We should insist that management moves in the direction the country wishes it to take. There is no reason why all these people should have to bug me about boxcars, or why I should have to bug the minister. It cannot be pleasant for the minister. Do you think it is pleasant for him to have to listen to these complaints all the time, Mr. Speaker? It is not. Management finds it very convenient to tell the country: Never mind, it will all work itself out. But will it? It will not, if parliament allows the situation to develop as it has been developing.
I am suggesting to you, Mr. Speaker, that for once we should deny this vote of money to management if only that they might be encouraged to get back to the original intent of parliament, which was to provide transportation in this country, not to inflate their egos.


Some hon. Members:: Hear, hear!


Mr. Jake Epp (Provencher):: Mr. Speaker, in rising today to speak on the amendment put forward by my hon. friend, the hon. member for Mississauga (Mr. Blenkarn) in respect of the Canadian National financing bill, I should like to submit to you some of the concerns which relate specifically to my own riding. For a long time now many Canadians have been concerned about the real priorities of the Canadian National Railways and whether those priorities, so far as they relate to the movement of passengers and goods across Canada, can be reconciled with what appear to be the priorities that CN has embarked upon. The public believe the priorities that CN appear to be establishing for itself are not the priorities they thought CN originally had or that they should have today.
For some weeks now we have been viewing on our national television network episodes of "The National Dream", depicting the building of the Canadian Pacific Railway. It is a re-enactment of the opening up of the west, a period that had tremendous impact not only on the people of that day but on Canadians of subsequent generations. There was a dream, a purpose, involved. It caught on-indeed, it caught on in many countries of the world- and it is still a very vital part of the dream that I would say Canadians have today. However, the operation of our
April 2, 1974

rail transportation system, specifically in light of some of the priorities the CNR seems to be pursuing has turned this dream into a nightmare today. This is especially true of the activities of the CNR in eastern Manitoba.
What are some of the very real transportation problems facing Canada today? The first question that comes to mind is: Can the CNR provide a transportation system while, on the other hand, still involving itself in the provision of many ancillary services? To most Canadians the role of the CNR is seen as a second transcontinental railroad, built in the early part of the century to provide transportation in an area where the CPR was not able to provide that service. This area generally was north of the present CPR system.
During the last few weeks the whole concept of the transportation system of Canada has been seriously brought into question because the Minister of Transport (Mr. Marchand) has stated very candidly that our rail transportation system is in a mess. Having said that, he also seems to have absolved himself from any responsibility or further action. I submit to you, Mr. Speaker, that the transportation system of Canada is in a mess largely as a result of the non-policy of the present minister. In addition, we are in a mess often because of the priorities of the management of the CNR, whose priorities should be to provide transportation-to provide one facility, one service, and to do so well, forgetting all else.
Why do we not have a national transportation policy today? When will we get one, and how will it affect Canadians? The amendments moved by the hon. member for Mississauga (Mr. Blenkarn) are vehicles of protest which we can use to show that the priorities of our transportation system are all mixed up, that the main priorities are not being followed. I mentioned earlier that our national dream can, I think, be described more accurately today as our national nightmare, especially in western Canada. What is the situation in the west? At the present time we are 100 million bushels of grain short in export position. At present world prices we are looking at a loss or potential loss of half a billion dollars.
Let me comment on the block system, and in particular on what is known as Keewatin 61. How can I tell a grain farmer in my riding who wants to move his grain to market, "Hang on; the CNR won't buy any more rolling stock right now but the government will look after you", when at the same time we give the CNR clearance to spend money on hotels? These farmers have been locked into a position throughout the winter, trying to move their grain to plugged elevators. Grain cars have failed to arrive, and when they have arrived it has been because extreme pressure has been put upon the railways. The farmers are then given the word to load the cars because they will be picked up the next day, and as a result they work all night to ready the cars. Then, the following day they see the train go by without picking up these grain cars. For some three weeks loaded cars have been sitting on our sidings waiting to be moved while trains have been going by on open lines.
So again I ask, where are our priorities? How can I explain to farmers with commitments to meet that hotels are more important than boxcars? I think the motions of the hon. member for Mississauga bring that point out very
Canadian National Railways and Air Canada vividly. A protest is welling up in western Canada at our transportation system, and if hon. members do not believe that, all they have to do is to come to my riding. We have had to use every vehicle in an attempt to get the railways to return to their real priorities, the movement of goods and passengers. But the only action we have seen in my riding during the last few weeks was when we were able to convince the railways that we had a potential flood situation along the Red River valley, according to the Manitoba flood forecasting committee, and that grain presently in storage on farms would very likely be damaged or lost. How do you convince the people within the CNR system of the urgency of the situation, and that movement of goods should be their priority, not the building of hotels?
A second aspect of this national nightmare is the so-called disruption of passenger services by the CNR. We now have servo-centres; these are supposed to be the "in thing". For months I have been trying to get the officials of CNR to keep the campers special going in eastern Manitoba, but it always seems that the only way to do so is to apply pressure, to cajole, to use the public media to convince CNR that rail passenger service should also be part of their priorities.
It is very common in western Canada to see the following notice placed on Canadian National public notice boards:
Application for authority to remove the station agent and building at this location has been filed with the Canadian Transport Commission.
To most disinterested Canadians this notice would not mean too much. But to people living in rural towns who depend on rail service and on jobs, these notices very often spell disaster.
I should like to place on record part of a letter that I received from a constituent of mine concerning this whole question of priorities for the CNR. The letter is dated February 4, 1974 and relates to the movement of passengers by the CNR. It reads, in part:
Elma is a town of 300-400 people, 50 miles east of Winnipeg on the CNR main line. It is served by rail, and is also linked to several provincial highways. Industry-really none, unless you might call the CNR presence one. Although not special, it is typical of a rural town, which, through government action, is dying, by having its roots severed one by one.
From an economic sense the railway station probably does not add many dollars to Elma and district, but it still remains a location which provides these services to local and district citizens, no matter how small and inconsequential they may appear ...
It seems very ironic that we have provincial and federal policies reputedly to promote decentralization of industry and families, and supposedly stop urban glut and sprawl, while simultaneously we have federal Crown corporations and agencies, actively engaged in policies thwarting such schemes. How can a small rural town, such as Elma, ever hope to become a viable identity, when one of its props is to be removed?
The closing of the Elma station will certainly not make or break the CNR. In fact, what we may be doing is shifting the responsibility. The chain of events in closing a station, and shifting an agent, eventually means unemployment insurance or welfare payments for someone down the line. Good old John. Q. Public then picks up the tab.
Is it better to pay a man for not working, by implementation of closure, than to leave rail stations such as Elma open?
That is the question this constituent asks.

April 2, 1974
Canadian National Railways and Air Canada
In reference to the CN financing bill, and specifically the amendments, what members of this House must impress upon the CN and CTC is the fact that the CN has an obligation to move goods and passengers for the wellbeing of all Canadians, and it should not and must not concentrate on activities which take away from that priority.
I suggest that the management of hotels by the CN has at best been shoddy. They are not competitive, and I am sure that we would have all the hotel space we need if hotel construction had been left to the private entrepreneur. I suggest that CN management should concentrate its efforts on doing one job well rather than expecting the Canadian taxpayers to blindly sign one cheque after another in order that the CN can follow its priorities, which too often seem to be in conflict with the priorities it was set up to follow, and definitely in conflict with the priorities many Canadians have set for the CNR.


Mr. Reg Stackhouse (Scarborough East):: Mr. Speaker, I rise to participate in this debate for two reasons. The first is to join with others in focusing attention on the lack of interest being shown by certain officials of the CNR for the people of Canada whom they purport to serve, and the other is to draw attention to the inadequacy of public ownership unless it is accompanied by concern for the people.
To illustrate the first point, I should like to draw to the attention of the House an experience my family and I had just a few weeks ago when travelling by CNR from Toronto to Ottawa. This was at a time when the management of that railway should have been fully aware that there would be a greater demand on their service than ordinarily, as it was a time when there were two major conventions being held in Ottawa and when the annual winter school break in the province of Ontario was beginning. It might well have been anticipated that there would be an extra demand for service. Instead, there was an inadequate supply of cars for the use of passengers wanting to make a journey to such places as Kingston, Montreal and Ottawa, with the result that a considerable number of people had to stand. Indeed, there were so many extra passengers on this train that the conductor had to find accommodation for some of them in the washrooms. I think we should recognize this as simply another illustration of the way in which the railways are not giving priority to the people whom the company was designed to service, the same people who have been supporting the railway.
I think one of the good results of this debate the House has been having, and of this amendment which I hope will carry, is that we are drawing attention to a mistake on which we should focus, namely that the people must come first and the CNR must adopt the policy of making them come first. This is not what the railway has been doing. The railway has to a great extent been giving the impression that it is interested primarily in freight and, to the degree it serves the people at all, it treats them like freight. What we want to say to the management of this railway is that it must start putting the people first. We recognize the concern, efficiency and dedication of the fine staff the railway employs. Indeed, without the calibre of the men and women working at various levels for the

railway, the services might not be as good as they are. What we want is direction from the top. What the country needs from this railway is what it needs from the government, and that is leadership from the top which is concerned about the people.


Some hon. Members:: Hear, hear!


Reginald Francis Stackhouse: The second point I should like to make in my remarks is the fact that the policy manifested by the experience to which I have referred, and indeed emphasized by the many other examples hon. members have cited, illustrates that socialization is not in itself a solution to all the problems of this country. One of the impressions one often gets from speakers for the NDP is that the solution to every problem can be found in the nationalization of an industry or perhaps the appointment of another government board. One really does not get anything from either unless you have leadership, be it in private or public enterprises, which puts the people first. One does not get that simply by providing a government takeover. It is a simplistic, tragic and serious mistake to assume that the government and the people are one and the same, and that if the government engineers a takeover or initiates regulations through a board, then the people will be served. Sometimes it is only the interests of those the government has appointed that are served. Very often they, themselves, have a vested bureaucratic interest which takes priority over the interests of the ordinary people. Therefore, I should like to emphasize that the attitude of the parliament and government of Canada in respect of the CNR as well as other corporations ought to be this: You have been established by the people to serve the people. Make that your priority and get on with it.
We see a particular need for this attitude with regard to the need for rapid public transit in areas surrounding our major urban centres. We see it, for example, in metro Toronto where a great step forward could be taken to serve the transit needs of a large number of commuters, and people making their way to and from work day by day if the railroad lines were used as they could be used in an effective public transit program. I recognize that such a program cannot be undertaken simply by the CNR or the federal government. It certainly involves consultation and co-operation with provincial and local jurisdictions, but the federal government surely has within its powers the ability to show initiative. It certainly has within its rights the opportunity to lead. One result we could see would be the beginning of greater enterprise in utilizing the rights of way leading into the heart of great urban centres such as metro Toronto in such a manner that thousands and thousands of commuters could make their way to the heart of the city day by day on a rapid public transit system free from pollution.
There are various reasons that this proposal must be given priority, one of which has been illustrated in recent months by the so-called energy crisis, much over emphasized and over dramatized by the government through the use of such terms as "crisis", but nonetheless of sufficient proportion to make us all aware of what indeed will happen if we do not take seriously the lesson that has come to us through the events of the last year. Therefore, we have to see the need now to make a major change from
April 2, 1974

dependency on the gasoline operated motor that has become basic to our way of life in the last two generations.
If the government really is leading, then surely it would want to take the lead in consulting provincial and local authorities across the country so that, before it is too late, we can have a comprehensive and socially constructive public transit program based upon the utilization of our railroad lines. If we had a government that put people first, and if that were the attitude of the CNR, then that would be exactly what we would do. We would have in every major urban centre the kind of development that would use these railroad lines and railroad rights-of-way so that rapid commuter public transit services would be employed.
I read recently about the three priorities of the CNR mentioned in a discussion of transport opportunities in the metro Toronto area. The first of these priorities relates to industrial customers-I take this to mean freight-and inter-city passengers going from one region to another. Their next priority is the GO line, that is the commuter service offered by the government of Ontario, and the third is to metropolitan Toronto. Is that what this government wants to say to metro Toronto: you are in first place? Is that what they want to say to the commuters of that vast area comprising within it now in excess of two million people: you are in third place? Are they saying: if there is any consideration to be given when every other matter has been looked after, then we will think of you? Surely, if we are putting people first, if we really care about developing a way of life that can be meaningful and satisfying to the kind of people that keep this country going, then the railway should say to those people: you are in first place and we want to give a high priority to your transit needs.
At the very heart of this problem we need a change of thinking. What we need is not so much to give priorities to various levels of government but to give priority to the people who are represented by those governments, to seek to establish a program that will involve the authority and jurisdiction of all three levels, federal, provincial and metro, all of them seeking in co-operation with one another to represent the interests of their common constituents. There are not three kinds of people that are represented by members of parliament, members of legislative assemblies and municipal councillors-they are the same people. We should get over this notion of thinking that governments have rights and claims of their own, and to recognize that the only excuse any of us have for being in office is to fulfill the aspirations and satisfy the needs of the people whom we commonly represent.
I would hope, therefore, that out of this debate there will come a new attitude to public transit in Canada, a new concern to utilize the CNR and other railroad facilities in the interest of the common people of this country. I think that we should recognize that railroads give us a new opportunity. For a long time it seemed as though the railroads were going to join certain other relics of the past in the antique museums of the country. For a time it seemed as though the railroads were going to be part of the memory of the Canadian people replaced by the jet aircraft and by the high speed automobile as the means by
Canadian National Railways and Air Canada which people would find transportation in an age of rapid movement. But under the combined threat of the energy crisis, and of the pollution crisis, it is now becoming apparent that we had better take another look at our railroads, that railroads offer us a chance to meet the needs of people in a way that does not pollute and does not threaten the energy resources of the country and in a way that can satisfy the needs and hopes of our people.
Let me give another illustration and refer to the experience of the hundreds of thousands of summer residents in the so-called cottage country of southern Ontario. Every weekend the population of the Muskoka and Georgian Bay regions of Ontario are expanded by hundreds of thousands of city dwellers who make their way northward for a few days of surcease from the pressures and pollution of urban life. For years and years the government of the province has been making bigger highways that can transport these multitudes northward on weekends. I suppose that if we went on travelling by car as the population grows we would expect Ontario to construct even more highways. But surely we need to recognize, for the two reasons which I have cited, namely, the threatening shortage of energy and the threatening danger of pollution, that we have a need to move in a contrary direction, that instead of simply building more and more six and eight lane highways to become massive parking lots for cars stalled in traffic jams at the beginning and at the end of each weekend, we will begin to see that we could use our railroad lines as a way of transporting the city dwellers to the cottage country during the vacation season.
In times past railroads were the main method of transportation. If you went to a town such as Gravenhurst and visited the local museum there, you could see pictures of the times when railroad trains came right on the docks. People holidaying were brought from southern Ontario to Gravenhurst and given the opportunity of arriving at the dock, of moving from the train to a steamship which took them to the various points on the lake from which they could get to their own family cottage. That was the style of people two or three generations ago and it served the people who had summer homes in that region. Surely, we could do something as good as that today. Surely, we can think in terms of having a railroad service that would provide the ordinary city dweller with an opportunity to commute each weekend without using his car, and without requiring further highway construction in that district.
I think that one of the things upon which we should all agree is the opportunity that we would have to serve our people if the CNR were, under the direction and influence of the federal government, to initiate that kind of service. I think of the great need that there is for this, not only because of the danger of pollution and of energy shortages but also because of the great danger posed by increasing auto traffic on the highways of our various provinces. One of the things that should concern us is the mounting death toll because of increased auto traffic. Between 5,000 and
6,000	Canadians meet their death in traffic accidents every year. If we were losing that many in military action, if last year we had lost even a tenth of that number in military action or peacekeeping ventures, there would be an outcry on both sides of the House. Somehow we seem to be gripped by a curious and heartless apathy when it comes to the death toll which occurs as a result of traffic acci-
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April 2, 1974
Canadian National Railways and Air Canada dents in this country. I hope that instead of unintentionally and unwittingly contributing to an expansion of that serious and tragic number of deaths by simply permitting and encouraging the expansion of auto traffic, we will begin to think in terms of expanding our passenger railroad service.
I am thinking of the way in which, at present, everything is done to discourage the ordinary person from taking a train. It is the same with our buses. But let us for the moment focus our attention on trains. If you want to take a passenger train to the cottage country today and take it home again, you have to spend most of the weekend in the train. The service is so slow, so inadequate, that a person has to be going on a really extended vacation even to consider taking a train to that holiday resort country.
Now, if in those bad old days when people were not supposed to be as developed, as up to date and advanced as we are now, it was possible to transport thousands of families to the cottage country holiday resorts by train and comparable public transport, surely we can do it today. And it makes sense. At a time when energy is supposed to be in short supply, at a time when the gasoline motor is supposed to be contributing to pollution, at a time when the threat of death is a constant danger to every car user on the highways in our provinces, surely we can begin to think in terms of a public transport program that will make sense in this age.
I welcome very much the opportunity this debate has given to various members to bring to bear on the government the concern of people across the country that the railroads, which were built to serve people, will do precisely that and once again they will be, even as when they were built, serving the people of Canada.


Mr. Terry Grier (Toronto-Lakeshore):: Mr. Speaker, I just want to comment briefly on one aspect of the problems connected with transportation in this country, and that is an aspect which is of particular concern to the municipality, part of which I represent here. Through the southern part of Etobicoke runs the main Canadian National line westward from the heart of Toronto. The line is used not only for the railway's freight traffic and such ordinary passenger traffic as there may be, but it also serves the GO Transit, the GO train system. There are located on this line the marshalling yards at Willowbrook. For several years there has been a rumour that these yards, the facilities contained within them, indeed the line itself, will be expanded, particularly if the GO train system itself is expanded. And as the railway facilities now located in and around Union Station are moved out of that area to make room for the Metro Centre development, the politicians and the planners in the borough of Etobicoke-I am sure I am describing a problem which is encountered in other municipalities in Canada-have been trying to ascertain for some time whether or not there is any truth to the rumour of expansion and, if so, specifically what kind of expansion is planned by Canadian National, in what directions, according to what time schedule, and so on. The concern of the borough of Etobicoke is, of course, one prompted by its own plans to proceed with

various kinds or urban renewal or development in areas bordering on the right-of-way.
At the present time, I know that the borough of Etobicoke is considering proposals to maximize the use of land in the vicinity of the railway lines for family living, either in the form of housing or by using the land closest to the line for parks. There has been discussion of possible relocation away from this area of industries whose current uses are incompatible with family living. There has been discussion of the reconstruction of streets and arterial roads which intersect, pass underneath, or above, or run parallel to the railway line.
There have been efforts in the past, and there are ongoing efforts, to control noise and noise pollution in the residential areas bordering on the rail line. There is a continuing consideration of development proposals whose location may not be directly adjoining the rail line, but whose eventual approval or otherwise is bound to be affected by the kind of transportation which can be provided by the railway.
The point of my interjection, Mr. Speaker, is simply to say, through the opportunity provided by this debate, that I urge the Canadian National to co-operate more freely and more openly than it has in the past with municipalities whose own plans are so closely tied into and are affected by the plans of the railway. I think it is self-evident that more co-operation with municipalities in integrating plans for rail line development and expansion with plans at the municipal level is helpful and that it can only work to the benefit of both parties. But for some reason there appears to be an over-concern with secrecy on the part of railway officials.
I do not know whether it is because they have plans they are not anxious to divulge, or whether they are in the process of developing plans which have not yet reached the stage of finality, or whether they have not got any plans at all and are embarrassed to admit it. Be that as it may, Mr. Speaker, I believe a greater degree of candor and frankness in dealing with municipal planners, municipal governmental authorities in Canada, would go some way towards improving the quality of life in the areas directly served or intersected by railway lines, particularly major rights-of-way, and would, as I said, work to the benefit of both the railways and the municipalities.
The hon. member who has just spoken has cited the expressed wish of railways to be of service to the community, and he has expressed some doubt as to whether they are fulfilling that objective. I think one way in which railways can be of service to the community, albeit, an indirect way, is to co-operate more freely and more frankly with municipalities in working out a total plan of development for a community which will make it a better place in which to live.


The Acting Speaker (Mr. Laniel):: Is the House ready for the question?


Some hon. Members:: Question.


The Acting Speaker (Mr. Laniel):: The question is on motion No. 1. Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: No.
April 2, 1974


Some hon. Members:: On division.
Motion No. 1 (Mr. Blenkarn) negatived on division.


The Acting Speaker (Mr. Laniel):: Accordingly, as previously stated, disposal of motion No. 1 does at the same time dispose of motion No. 2 appearing in the name of the hon. member for Mississauga (Mr. Blenkarn) and this motion is defeated on division.


Some hon. Members:: Agreed.


The Acting Speaker (Mr. Laniel):: If hon. members have no objection, we might proceed at this time with motion No. 4 which has been announced as acceptable to the Chair. We could leave motions Nos. 3, 5 and 6 to be examined afterwards and perhaps we could have an exchange of views on the procedural acceptability of those three motions then.


Some hon. Members:: Agreed.


Mr. Don Blenkarn (Mississauga) moved:: Motion No. 4:
That Bill C-5, to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways System and Air Canada for the period from the 1st day of January, 1973, to the 30th day of June, 1974, and to authorize the guarantee by Her Majesty of certain securities to be issued by the Canadian National Railway Company and certain debentures to be issued by Air Canada, be amended in paragraph 7(4) (a) by deleting line 44 on page 5 and substituting therefor the following:
"shall not exceed $133,300,000; and"
He said: Mr. Speaker, the motion calls for a reduction of some $6.7 million from the $140 million demanded in clause 7(4) (a) of the bill. The amendment arises from discussions in committee, especially those that took place with Mr. Cochrane from Air Canada. When he was asked why Air Canada needed $140 million, he produced a 1973 revised budget which indicated the moneys required. At this point I might say that while the bill previous to this one, Bill C-164, was introduced in the spring of 1973, it was not determined that Air Canada needed $140 million until August, 1973.
The Minister of Finance (Mr. Turner) who is here today, is responsible for introducing the bill calling for the payment of $140 million to Air Canada. But at the time the original bill was introduced, Air Canada had no budget to indicate how this money was to be spent and they did not organize a budget until August, 1973. As a member of this House, I find it shocking that the Minister of Finance should introduce a bill calling for an appropriation for a Crown corporation without an examination of the figures that indicate the need for that advance.
We spent some time analysing the statement produced by Mr. Cochrane who attempted to justify a number of items. Rather than go into the depreciation allowances on aircraft and whether the exact deferred charges, interest charges and finance charges as well as the calculations for decrease and increase of working capital were exactly correct, we looked at one particular item, the requirement for this $140 million. We find in the statement produced by Air Canada a request for $6.7 million, not to fix up aero-
Canadian National Railways and Air Canada planes, not to expand air routes, but to go into a subsidiary business.
This corporation has an obligation to the people of Canada to run an air service and that is why it was incorporated. Like their parent corporation, the Canadian National Railways, they have decided to grow, not in the air field. They are going to become another colossus and have associated with the railway in a consulting service. In addition, they have associated themselves with Commonwealth Holiday Inns, and others in the hotel business. They intend to go into the charter business, and because they cannot run it effectively themselves, by their own admission, they propose to buy a percentage of Wardair Canada Limited. They also intend to go into the manufacture of aircraft and into the aerospace industry in partnership with Comstock Limited.
First of all, let us consider the arrangements made with Wardair. Mr. Max Ward is a pretty competent man. He has built a first class business in the charter field. When giving evidence before the Canadian Transport Commission, Canadian Pacific Airlines indicated that although it owned very few planes, Wardair had 35.6 per cent of the Canadian charter market. Clearly their operation in the charter field is the best in Canada. When Wardair needed some money, the vice-president of Air Canada, Mr. Bond, conferred with Mr. Ward. He examined the statement of Wardair and thought "My goodness, Wardair really knows how to do things; maybe we could learn something from Mr. Ward." Mr. Ward is a good businessman and he said, "Well, I could sell you a piece of my company." The balance sheet shows that Wardair is valued at $3.5 million but Mr. Ward, being a good businessman, arranged to sell to Air Canada 30 per cent of his company-not for 30 per cent of $3.5 million but for $2.7 million. That was a good deal for him.
The proposition then went to the Canadian Transport Commission which was most concerned that the purchase by Air Canada of 30 per cent of Wardair would not reduce competition in Canada. On the basis that the purchase was only for 30 per cent, the commission decided that this would not produce competition and allowed the transaction to be completed. That decision was appealed to the Governor General in Council and that is where the case has been for over six months.
Mr. Speaker, you will recall that a motion was made in the hearings on this bill before the Standing Committee on Transport and Communications, directing the government not to approve the purchase by Air Canada of 30 per cent of Wardair. The motion delivered by that committee to this House was ruled out of order, however, and the matter could not be debated. Nonetheless, the matter is still before us because in this financing bill, $2.7 million of the $6.7 million that is the reduction set out in this amendment to the statute, is for the purpose of completing the Wardair transaction.
e (1640)
Sir, we examined the Wardair balance sheet. Air Canada suggested that the company was really worth $8 million. We found that Wardair, like all air lines, amortizes its commitments to reflect the true life expectancy of its aircraft. So, we also looked at its aircraft. We found, at the
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Canadian National Railways and Air Canada time of the transaction, that Wardair owned four twin Otters and a Bristol freighter. According to Mr. Baldwin, past chairman of Air Canada, the Bristol freighter is not of much use. In addition, the company leases other equipment. The Wardair balance sheet, which shows a company value of $3.5 million, reflects the true value of the company's assets; yet Air Canada, in its wisdom-that company really knows how to make deals-will acquire 30 per cent of Wardair for $2.7 million.
We wondered if Air Canada wanted to learn from Wardair how to operate the charter business. If the company hired Mr. Ward to run the Air Canada charter business, that part of the operation might be profitable. But that is not to be the case. The company is acquiring a minority interest in Wardair. Indeed, the decision of the Canadian Transport Commission says that Air Canada is entitled to no more. If Air Canada wants to exercise its option and buy all of Wardair, it will need to go before the CTC again. The company is prepared to invest $2.7 million of public funds in Wardair, out of the $140 million to be advanced under this bill, to acquire a minority interest in the charter air line. That will not extend service for the people of Canada.
This move will do little except provide more holiday accommodation. It will not do anything about the real, social problems of Canada. Air Canada will merely expand its operations. It will become involved in another enterprise. Like some other Crown corporations, it is not satisfied to do the job Parliament entrusts to it. It wants to become bigger and grander. It is time this House called a halt to this, and time the government did, too. If Air Canada cannot provide necessary, regular route services to the various parts of Canada, we should let somebody else do it. We should not permit Air Canada to grow and grow and use money of the taxpayer of Canada to expand into fields not normally related to its business.
It was suggested that Wardair was not a bad buy, that the shares were valued at about $2.50 each. You will find that they are worth $1.60 on the Vancouver market. They are being traded on the basis of 30 times earnings. You will find, also, that the Wardair balance sheet indicates a deficit in working capital. That being so, you wonder, are the directors of Air Canada using sound business judgment when they decide to expand into a business venture that is not related to their main business? That is why this amendment has been brought forward.
By bringing forward the amendment we are not attempting to say that the people who work for Air Canada are incompetent or do a poor job. They do a good job. We have a good air line, but we could have a better air line if the people running it paid more attention to it instead of looking for other investment opportunities. In a moment I shall deal with the Comstock matter.
Speaking of investments, Air Canada incorporated on January 1, 1973, a company known as Econaire Holidays Limited. The company was to be in the charter business. The Minister of Finance (Mr. Turner) will be pleased to know that in nine months of operation this new company lost only half a million dollars. The minister can probably lose money more quickly himself. Yet here we go again. The directors of Air Canada wanted to go into another business. They incorporated Econaire Holidays Limited,

booked charter flights, provided air line service on the cheap and lost only half a million dollars. That is the kind of thing other Crown corporations have done, as was suggested in the debate on the previous motion to do with Canadian National Railways.
Apparently Air Canada wants to become a colossus in its field. You might not mind if Air Canada were a real profit maker and returned big dividends to the people of Canada. Actually, it returned dividends of about $200,000 a year, or less than 3 per cent on investment or turnover. Indeed, Air Canada seems to be only half as profitable as other airlines in North America, which is a sad reflection. Canadian Pacific is over twice as profitable and Delta two and a half times as profitable. Air Canada would perform better if it were better managed. Certainly, the management should not flit around and invest in subsidiaries.
Let me give you another example of inefficiency. There is in Toronto a certain terminal which was designed for handling people. By a mistake, the Ministry of Transport built a terminal which nobody can stand. It is almost a cattle barn and would be an excellent freight shed. Yet who takes the terminal over, apologizes, and says that it is a wonderful terminal? Who else but Air Canada, even though that terminal, in the year ending December 31, 1973, cost Air Canada in lost revenue at least $1,500,000. That shows what sort of management runs Air Canada.
In speaking of subsidiary ventures, I shall now refer to the Comstock deal, and to the sorts of answers Mr. Pratt, president and chairman of the board of Air Canada, gave to the committee when dealing with the issue in question. If my memory serves me correctly, it is proposed that Air Canada will put up $4 million, that Comstock International will put up $6 million and that the two companies will borrow, interest free, $16 million approximately from the government of Canada. So, the government is really putting up $20 million. The common stock of the new company will be divided in the ratio 60/40, the government-owned corporation owning 40 per cent of the stock although the government will put up a greater percentage of the money. This will happen. The company will go ahead and acquire General Dynamic's position in Cana-dair and de Havilland's position in the facilities in Toronto. We asked about this. Air Canada, in a paper put out for its employees, set out some parts of this transaction. We found that the company has almost made the deal. It is telling its employees, "By golly, we are going into the aerospace manufacturing business." The proposals are there, we are going ahead with them.
My colleague, the hon. member for York Simcoe (Mr. Stevens), asked the president of Air Canada about this transaction. He said that it was just in the talking stage, but they did not know the government's policy so of course were not committed to it. However, they tell their employees, through their own employee news service, that they are going ahead. If they are not committed to it, why is there provision in the estimates for money for this transaction? Why is this bill being pushed on us to provide $6.7 million for further investment in subsidiaries? Why do we get the runaround in committee meetings when questions are asked about the money involved and the profitability of the government of Canada, through Air
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Canada, getting involved in the manufacture of aircraft or whatever?
It is time that Air Canada used its efforts and management capabilities to run an airline, to run it well and profitably. Air Canada has no authority from this House to get involved in hotels, manufacturing, subsidiary interests and other charter business. Air Canada is supposed to be our prime national carrier. It has a preferred position in air traffic. With that preferred position, it should be able to generate a significant return to the people of Canada, and at the same time supply them with exceptionally fine service. If we are going to have an airline, let's have an airline. If we are going to have another colossus in the investment field, then let's change the nature of Air Canada and get some good investment people in it. This corporation should not be an investment vehicle. It should be directing its efforts toward what it should be able to do best.
At one time Air Canada had a monopoly on the Vancouver to Victoria route. It also had a monopoly on the Calgary to Edmonton route. Those routes have largely been taken over by another airline which has been able to provide far better service than Air Canada. I ask this House, when will this airline get into the business of supplying air service and quit trying to pretend that it possesses the ability to be a financial colossus?


The Acting Speaker (Mr. Laniel):: Is the House ready for the question?


Some hon. Members:: Question.


Mr. Mackasey:: Mr. Speaker, I had anticipated making a speech, but if we could go ahead with the question, I would be glad to defer because we have been over this many, many times in committee. I would be very happy to waive any participation and go on to the next stage of the bill.


Sinclair McKnight Stevens: Mr. Speaker, I intend to speak on the motion that is before us, but in view of the fact it is now three minutes to five, I wonder if I could call it five o'clock.


Bryce Stuart Mackasey: Mr. Speaker, it appears from the hon. member's remarks that he intends to speak later this evening. If the three minutes are not going to be used to have a vote and if the hon. member intends to speak at eight o'clock,-


The Acting Speaker (Mr. Laniel):: Order, please. Perhaps we could call it five o'clock. If the hon. member wishes to seek the floor before five, he can do so and then we can pursue the debate after eight o'clock.


Bryce Stuart Mackasey: Mr. Speaker, my remarks will be rather short and to the point. I listened with a great deal of attention to the hon. member for Mississauga (Mr. Blenkarn). I think we have mutual respect in this area. We were on the committee together and we went over this issue of the role of Air Canada. I think there is a philosophical difference of opinion as to whether you can run an airline without having access to hotels and charter flights, and whether you can have
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access to what I think is a very rapidly changing environment for the airline industry.
The airline industry is much more complicated than it was three, five or 10 years ago when it was nothing more than a domestic operation. I can hardly visualize any airline operating without access to hotels and the charter business. For this reason and no other, Air Canada's participation in the charter field and hotel business is not only logical, but it would be very illogical if they were not. Whether they are in it properly and operating efficiently is a matter of opinion. Possibly we even share an opinion on that subject. I should not say we share it because it is a very grey area. It is opinion. However, I think we all agree it is virtually impossible for the national airline of a country, in a very competitive world, to expect to be able to remain competitive in its fight to attract sufficient passengers in the future if it cannot offer a complete service. That complete service must, of course, include access to hard to find hotels in certain parts of the world and an upgrading of expertise in the charter field. May I call it five o'clock, Mr. Speaker.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Laniel):: It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Vancouver South (Mr. Fraser)-Northern Affairs-Request for reconsideration of decision to permit seismic exploration on Bathurst Island; the hon. member for Sault Ste. Marie (Mr. Symes)-Oil pipeline extension to Montreal-Reason for rejection of extension of existing Sarnia-Toronto line; the hon. member for Perth-Wilmot (Mr. Jarvis)-Agriculture-Dairying-Request for statement on long-term policy.
It being five o'clock the House will now proceed to the consideration of private members business as listed on today's order paper.



PRIVATE MEMBERS' PUBLIC BILLS


Mr. Elias Nesdoly (Meadow Lake) moved: that Bill C-103, respecting the guarantee of supply of parts for motor vehicles and farm implements imported into

April 2, 1974
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Canada or sent or conveyed from one province to another be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
He said: Mr. Speaker, this bill, numbered Bill C-103 and cited as the Motor Vehicle and Farm Implements Act appears in my name because I feel there is a problem in this country in obtaining parts for motor vehicles and farm implements. Essentially, this is a simple bill whose main purpose is to make certain that anyone who buys a motor vehicle or farm implement which is manufactured in Canada and conveyed from one province to another, or anyone who buys a motor vehicle or farm tractor which is imported into Canada, shall be guaranteed a supply of parts for a period of ten years. As a result, farm tractors in particular, will not remain idle while the farmer loses money and waits an indeterminable length of time for a part to arrive from abroad. The owner would be able to approach his dealer with confidence and obtain the necessary parts in short order.
Very briefly, Mr. Speaker, this bill provides for the Governor-in-Council to make regulations prescribing that a supply of parts for farm implements and motor vehicles covered by the Act shall be guaranteed for a period of ten years from the date of sale to the user thereof. It also provides that no manufacturer or distributor shall send or convey, or deliver for the purpose of sending or conveying from one province to another a farm implement or a motor vehicle manufactured in Canada unless he complies with the regulations under section three of the Act. It also stipulates that any manufacturer or distributor who violates the act is guilty of an offence and liable on summary conviction to a fine not exceeding $10,000.
I bring this matter to the attention of the House because of a number of situations which have arisen in the area of Saskatchewan that I represent. I am sure similar instances have occurred many times in other parts of Canada. In one instance a farmer was busily combining when a major part broke on his combine. He contacted the local dealer. The dealer did not have the part available and phoned warehouses in the province only to find that parts were not in stock and that the only place where one could be located was Calgary. The distance from the farmer's place to Calgary was 420 miles. He and his son set out on an all-night drive to Calgary, picked up the part and were combining again 24 hours later. They had been put to considerable inconvenience and expense and it would obviously have been far better had the part been available in Saskatoon, Regina or some other major centre in Saskatchewan. After all, we are the leading agricultural province in Canada.
Another farmer was compelled to keep his tractor out of commission for about six months because he could not get a simple repair carried out. When this farmer wrote to me I notified the Agricultural Implements Board in Saskatchewan and the Board was able to see to it that the farmer got his repair work done. In this case there was probably a breadown in communication between the farmer and his dealer.
Another farmer purchased a tractor. He ordered a belt pulley as an extra. He had to wait for eight months before he finally got his pulley. One of the problems arose as a result of a discrepancy in the company's records. The

inventory indicated a substantial supply of pulleys on hand, but they had somehow disappeared. Possibly a computer was at fault. Eventually the factory was convinced and a further supply was shipped. The farmer finally obtained his pulley, but not before there had been a long delay. I could give other examples of extreme difficulty encountered by farmers in getting repairs done for their tractors and farm implements. The same applies to farm trucks, snowmobiles or powered toboggans and automobiles. I, personally, had to wait several months for repairs to be carried out to an automobile I owned. It is frequently very difficult to obtain spare parts for farm vehicles or other vehicles, when they are more than six or eight years old. It seems to me as though many companies are pursuing a policy of deliberate obsolescence. They are not interested in a vehicle after it has been in service for seven or eight years.
The constitution is not clear as to whether this whole question of repairs to machinery and motor vehicles is the responsibility of the provincial governments or of the federal government. Many of the provincial governments are doing good work in this field. However, I feel that the federal government cannot shirk its responsibility, especially when the farm implements or motor vehicles concerned cross provincial or international boundaries. At this time, four provinces in Canada have enacted laws which deal with the whole question of farm repairs and farm machinery. I have no knowledge of laws dealing with automobiles and powered toboggans. These provinces are Alberta, Manitoba, Prince Edward Island and Saskatchewan. It is possible my information may be somewhat out-dated on this point-I got it from the report of the Barber Royal Commission on Farm Machinery. Essentially, the purpose of the acts in those provinces is to protect the farmer in his relations with suppliers of farm machinery. The Barber Royal Commission recommended that all provinces review the legislation passed by the four provinces in this field and consider whether they should not introduce legislation of their own, if they had not already done so.
I shall review very briefly the legislation passed by some of the provinces. In Saskatchewan, the Agricultural Implements Act was passed in 1968 and amendments were added up to, and including, 1973. The act sets up an Agricultural Implements Board and one of its functions under section 6(C) (b) is as follows:
To take such action as may be necessary to reduce or correct unreasonable delays in the delivery of repairs, and unreasonable charges for them, and to recommend to the minister appropriate action to alleviate such problems.
Section 6(D) (1) stipulates:
A farmer who feels himself aggrieved or who considers he has incurred a loss due to an unreasonable delay in the availability of a repair or who considers he has incurred a loss due to the vendor or the general provincial distributor not fulfilling the conditions or warranties as set out in a conditional sales contract... may apply to the Board for an award of compensation for the damages or loss he has suffered.
Section 6(D) (2) states:
Upon receipt of an application under subsection (1) the Board may, subject to the regulations with respect to notice of the hearing to interested parties and the conduct of the hearing, dismiss the application or make compensation to the applicant farmer out of the Agricultural Implements Compensation Fund.
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Section 8 states:
Every general provincial distributor who has sold or distributed implements, or has implements sold or distributed on his behalf, and those implements are in operation in the province, who fails to maintain in the province an adequate supply of repairs that may be required for those implements is guilty of an offence and liable on summary conviction to a fine not exceeding $500.
That is a broad summary of the legislation in Saskatchewan. But since Saskatchewan really has no authority over machine companies who bring equipment into the province or over machine companies located in Ontario, the authority of the province is somewhat limited. In summary, then, Mr. Speaker, the purpose of the Agricultural Implements Act in the province of Saskatchewan and the Agricultural Implements Board, which is a creature of the act, is to make sure that any new implement sold in the province is backed by a responsible distributor. Second, its purpose is to give consumer protection through sales contracts, with specific warranties and conditions. Third, it provides for a mediator to assist in disputes with an implement dealer or manufacturer on warranties and contracts. Fourth, it provides protection against costly losses due to negligence by manufacturers or distributors in honouring warranties or providing parts. Fifth, it helps in the location and delivery of parts, and lastly provides compensation payments from a fund to be established in the near future. Farmers may be compensated for losses or damages because of delayed parts delivery or poor warranty service.
In 1967 the province of Alberta passed the farm implement act. Section 7(1) of this act states:
Notwithstanding anything contained in the agreement, every sale agreement of a new farm implement shall be deemed to contain a warranty that a sufficient supply of repair parts for the implement will be made available by the vendor for a period of 10 years from the date of agreement.
(2) Repair parts shall be made available to the purchaser within a reasonable length of time after a request therefor is made to the vendor, but the vendor is not responsible for any delay in delivering a required part that is due to circumstances beyond his control.
With regard to this particular section, Mr. Speaker, I argue that if the vendor is not responsible for delay due to circumstances beyond his control, then there is not much that can be done for a farmer if the delay occurs in a factory in Ontario where the required parts are being manufactured. Therefore, this simply lends credence to the fact that we need a new national act such as the one I am proposing today in order to ensure that all motor vehicles and farm implements are guaranteed a supply of parts for at least 10 years.
I should indicate that this year the province of Saskatchewan is in the process of passing an act entitled "the Agricultural Machinery Institute Act". I believe there is co-operation with the provinces of Alberta and Manitoba in this respect. This institute, by the way, was also recommended by the Barber Royal Commission on Farm Machinery, and I am glad that the federal government is co-operating in this regard. Its main function is to test and appraise under actual or similar working conditions machinery that is sold or is intended for sale, to undertake development work to improve and develop machinery for agricultural use, and to publish reports, pamphlets and
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bulletins which will be passed on to the farmers regarding the status of certain types of farm machinery. There have been some advances made, but I still feel that we need an act that is national in scope.
In this regard I received a letter from a farmer some time ago who had this to say:
The farmers of western Canada and I am sure the ones in the east have been subjected to more "legal and illegal rustling" by offshore companies than by any other "rustlers".
He is applying this expression to farm machinery companies which he feels have not always met their obligations.
One of the resolutions passed by one of the farmers organizations in the west concerning farm machinery read as follows:
Be it resolved that farm machinery companies and their dealers be held responsible to uphold any warranties or conditions stated in the bill of sale or instruction manual and in default of this responsibility, their license be suspended until all losses incurred by the farmer are paid by them.
I might indicate that this resolution has been partly resolved by some of the provincial acts that I cited earlier.
There were many recommendations in the Barber Royal Commission on Farm Machinery. This government has not acted on too many of the recommendations, though I must say it has acted on a few of them. However, I am particularly interested in the Barber Royal Commission statement in their report on farm machinery parts, which is as follows:
Farmers repeatedly complain about the difficulty frequently encountered in obtaining spare parts to repair farm machinery, particularly when it breaks down in the field during peak seasonal activity. Occasionally a part ordered on a routine basis in the off season may turn into a part needed on an emergency basis because the part is out of stock, and a long delay occurs before it becomes available. All companies should develop some method of dealing with this situation. Farmers also frequently complain of their inability to find out when the required part will arrive. If all companies could provide their dealers with a prompt estimate of how long it would require to fill an out-ofstock emergency order, the farmer involved would be better able to deal with his problem. In some situations he might be able to have a substitute part produced in a local machine shop.
I feel it should be the responsibility of the machine companies as well as the automobile companies to provide a supply of parts for at least 10 years, perhaps I might even say for 20 years if we want to preserve our resources. As I said earlier, it seems to me that we live in a society of deliberate obsolescence. There would be far less waste in our society if the various farm machinery companies and motorized vehicle companies planned to ensure that they had an adequate supply of parts for equipment and implements in every province of Canada in which they do business. I am not sure that this is always the case. In other words, I feel there should be a central warehouse, or several central warehouses, in each province conveniently located, stocked with a good supply of parts which would be available to farmers within a few hours' notice. If they are not, then the companies should be held liable.


Stanley James Korchinski: Mr. Speaker, I have no hesitation in supporting this bill presented to the House by the hon. member for Meadow Lake (Mr. Nesdo-ly). I understand some of the problems that are inherent in our agricultural machinery industry, but I wonder why

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in the world this kind of bill is introduced in this House of Commons. I do not think there should ever be a need for this kind of legislation. The industry itself must realize that it is not just a question of salesmanship, of being able to sell big machines. It is not simply a question of computerizing and tabulating farm implement sales on a balance sheet at the end of the year and congratulating salesmen on a tremendous job done. The industry has to do more than that. It must understand that in order to gain the confidence of the people it has to be able to earn it, and in this regard I think the industry has, to some extent, been very sadly lacking. In interprovincial transactions, provinces have the right of scrutiny of terms and conditions. I think the same right should apply equally in regard to companies that operate within the province. I do not think that companies that sell equipment, machinery and motorized vehicles in all provinces should be singled out.
The situation outlined by the hon. member is a very common and irritating one. I have personally had countless experiences of this kind. I had one combine which sat idle all fall waiting for a piston cap to arrive, and we had to use only one combine. This kind of situation is ridiculous. I had an experience where another farmer and I were working together and started to harvest very early. One of his machines broke down and he waited about three weeks for a part to arrive. Finally, when I completed my own combining my machine had to work his fields as well, and he was a little disturbed that his machine had to stand idle. He had only recently purchased it, yet he could not get the part required. I told him I would fix that in a hurry and I phoned the company. I had a little difficulty trying to get through in order to explain to them the nature of the problem. Of course, the officials were away and the secretary was just acting as sort of a buffer between those making the complaints and those at fault, so the matter was continually put off.
While I do not like to use my position to bring pressure to bear, I finally had to resort to this. I told them that, as a member of parliament, I was taking the matter up on behalf of one of my constituents, and might have to use other measures to force the company to realize there was a problem. After about half an hour, I finally got a call through. I must say that the dealer was very hard-pressed. He sent off no less than three telegrams and made a phone call. He did everything possible, and I am convinced that he was not to blame. The representative of the company in question said: Okay, what is your problem? I knew the part number and I said: We need these parts immediately. He said: Well, we will look into it, and within two days they did send out the parts.
After I got through to the president, the company unloaded all the parts, in addition to the one we ordered, that the dealer had ordered over the past six months, all send c.o.d. This dealer was probably having difficulties with the company and he had to run all around the countryside to collect enough money to pick up that one c.o.d. which may or may not have contained the part we wanted. In any event, they did send the one part. The following day the dealer had another consignment sent to him c.o.d., and he had to run around the country to all the people who owed him money as well as to all the credit

sources he had in order to pay for that one consignment. At one time he went to the fellow at the bus depot and asked him to open up the consignment. That fellow said: I can't do it; you pay for the c.o.d. and I will open it up. The dealer said he did not even know whether the part was in there.


Mr. Knowles (Winnipeg North Centre):: All you wanted was one nut.


Stanley James Korchinski: That was about the size of it, but that is exactly how ridiculous the situation can be. You can tie up a $15,000 or $18,000 piece of machinery, yet the dealer does not know who is at fault. It may not even be his fault. Dealers have had their financial difficulties and I am very loath to fault the local dealers because of their difficulties.
I have had similar experience with the John Deere Company which is discontinuing machine dealerships all across the country. It does not matter how many machines these dealers have sold in the past, that is not important. The important thing is how many machines the dealer has sold in the last year. I have seen the same situation in respect of other companies such a J. I. Case and International. These companies have forced dealers to move from one part of the country to another and have just caused some of them to go bankrupt. Then, if a dealer has not sold anything in the last year the company tells him he is out.
At the same time I think I should point out one other thing. We are all too ready to lay the blame on the company, but we must recognize that there are people working within those companies. Very often the attitude of those employees is that they could not care less. They do not care whether they drop a part and it breaks or whether it is in proper condition when it is received. Apparently that is not their concern. I suggest that transportation companies adopt the same attitude of not caring. They feel that they have done their job and if the part is broken that is not their fault. They believe it must be somebody else's fault.
I have heard of many cases of people phoning in and not being able to get any response on a Saturday or a Friday after three o'clock. Can we really blame the companies for everything that goes wrong, and assume it is the responsibility of the company? It seems that is what most of us assume? I suggest that the general attitude of our society is not conducive to improving conditions. I think workers employed by those companies must share a part of the blame. It is too easy for most of us to put the blame on the machine companies, but these companies cannot operate without the services of the people who work for them. I think we must recognize that a great deal depends upon the attitude of those within the organization, and it is this attitude that produces good relationships all the way down the line. Surely, the dealer does not want to lose a customer, the machine company does not want to lost the customer, and surely to goodness the people employed by these companies do not want to lose their jobs.
It is too easy for hon. members such as the hon. member for Regina East (Mr. Balfour) to suggest, as he did a few moments ago, that it is the fault of the companies, because the companies are big and they can take the blame. Some members take this attitude because they must restrict themselves in their criticism. That statement may be a
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little strong for the NDP, but everyone in this society must realize that we are all at fault. Do we or do we not care enough about what happens to the other man? I have seen this so often, as I am sure every hon. member of the House and of this country has. I have in mind the sloppy work that is so often done, yet people want to earn more and must earn more in order to counteract the effects of inflation. They think that the little bit they do is insignificant, but I suggest everything must be added to the cost of a commodity.


Mr. Paproski:: You were referring to the hon. member for Regina-Lake Centre (Mr. Benjamin), not the hon. member for Regina East (Mr. Balfour).


Stanley Howard Knowles: Don't heckle your own member.


Stanley James Korchinski: Regina-Lake Centre, that is correct. What I said was wrong.


An hon. Member:: You might as well put the blame where it belongs.


Stanley James Korchinski: I only wanted to say that it is too easy to say somebody else is at fault, and that very often we must all share the responsibility. I agree with the hon. member who suggested that society is geared for planned obsolescence. When you consider the way some of the young fellows drive these vehicles into the ground, I would rather let them drive an old truck than buy them a new one, so long as the old truck was serviceable. That is fine for my purposes. We are not trying to compete with the Joneses out there. Therefore, I think there is a need for this type of legislation, and I think governments at all levels should take a firm stand.
When we consider our limited resources, what use is there in having one scrap pile after another in the farmers' yards just for the sake of a few missing parts? I know many farmers who operate old machines that are just as serviceable and just as handy as the new ones, and they are not making annual trips to the bank to get mortgages in order to buy new machines. In fact, these machines are just not available any more. So what is the alternative? Instead of scrapping the whole thing, perhaps one should adjust some things. All I am saying is that the government should consider this matter very carefully in view of the limited resources in this area. If this is done, perhaps someone in one of the big cities will suddenly take note of the fact instead of just saying that farmers can afford these machines. Someone should pick up the cudgel and say, "Let us provide the parts that are necessary. Let us carry the message not only to the machinery companies but right into the factories. Let us see if we cannot preserve some of the resources which we have, because they are limited".
I have no hesitation in supporting the hon. member for Meadow Lake (Mr. Nesdoly) on this occasion, but I want to point out the other side of the story rather than simply blaming the machinery companies. For example, I could say that I think improvements could be made. A telex system could be adopted which would provide instant
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information. After all, we have the Zenith telephone system. This is an example of the kind of system which I think could be put into operation. I have had unhappy experiences with machines. They are pretty expensive. I do not think one has to go farther than five or ten miles from his own home town to find enough examples to fill a book. I believe the time has come when not only the provincial governments but the federal government must move into this area because of the absolute waste of resources that is occurring.


Mr. Leopold Corriveau (Parliamentary Secretary to Minister of Agriculture):: Mr. Speaker, it gives me pleasure to rise this afternoon to discuss Bill C-103 whose purpose is to ensure that anyone who buys a motor vehicle or farm implement which is manufactured in Canada and is conveyed from one province to another, or that anyone who buys a motor vehicle or farm tractor that is imported into Canada shall be guaranteed a supply of parts for a period of ten years.
Mr. Speaker, I would like to quote here a few survey notes in that respect. In its public hearings, the Royal Commission on Farm Machinery was struck by the number and the firmness of the complaints made by all farm organizations about the difficulties encountered by farmers in finding efficient and reliable parts service. It seems to be felt generally speaking that manufacturers should be in a position to provide better service than now, particularly by stocking more parts with their dealers and branches. That is of prime importance for the farmer because a delay of a few days in getting a major piece of farm machinery going during a difficult harvest could result in very serious losses.
To better appreciate the nature and the extent of that problem, the commission made two surveys. The first one in November 1967 was limited to four provinces-Ontario, Manitoba, Saskatchewan and Alberta-and urged farmers to point out any particular problem they had encountered in obtaining parts or maintenance for their implements in the period after April 1, 1966.
The second survey in January 1968 included the distribution of a shorter questionnaire to a specifically selected sample group of farmers across Canada. The purpose of the questionnaire was to provide an overall assessment of the extent and the seriousness of the problems encountered by farmers with respect to parts and maintenance.
During the first survey, some 50,000 questionnaires were distributed. Out of that number, 7,259 or about 15 per cent were returned. About 22 per cent of the forms returned mentioned a problem of spare parts or maintenance. The complaints dealt with 78 various kinds of material, but the ground of a great number of grievances, that is about 43 per cent, was tractors. Comparing the number of complaints and each kind of implements on the farms, it became clear that as far as the number in use was concerned, the combine gave more trouble then any other equipment, perhaps due to the complexity of the machine and the large number of working parts.
In a more thorough follow-up of the survey 20 typical complaints were selected for each of the four provinces and an interviewer met with the farmers, the suppliers

April 2, 1974
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and eventually the staff of the companies in order to determine the circumstances of each complaint. They were all provincial residents who had a good farming experience and had at least completed two years of agronomy or agricultural engineering at the university.
The talks with farmers took place immediately after the crops, when those surveyed had the time to discuss their problems with the facts still fresh in their memory.
Of the 80 cases reviewed in detail, the great majority of those surveyed complained that they could not immediately find spare parts when they needed them. The most significant findings of this study in depth were, I believe, that the dealer was wholly or partly responsible in about half the cases.
The typical remark of the interviewer in this case was that the parts ordered by the dealer were not the right ones; that the dealer had not ordered the parts or had been slow in ordering them; that the dealer had not advised the farmer when he received the part.
In 5 of the 80 cases reviewed, it was found that the farmer has no cause for complaint. In 7 other cases, the farmer was found partly responsible. Of the 69,000 ques-tionaires sent across the country over 55 per cent were returned, which is a wide response for a postal survey.
Besides, about 48 per cent of those who answered complained of having had much difficulty in obtaining parts in the past two years. As regards the manufacturer's problem, it seems at the present time that all big factories have to keep in stock a number of various parts most of which account eventually for few sales every year.
Massey-Ferguson pointed out that the number of various parts in stock in North America had increased from about 68,000 in 1958 to more than 100,000 in 1967. Out of that total, 30,000 parts had not been bought even once in 1966. Of the 54,000 parts for International-Harvester farm implements kept in stock in Canada, almost half had been ordered only once or not at all during the previous year.
The International Co. pointed out that about 60 per cent of the parts in stock were for machines not manufactured any more. Massey-Ferguson pointed out that tractors' and combines' parts remained in stock at least 15 years after the company had stopped manufacturing the machine and that spare parts were still available for many machines not manufactured for 20 years. Considering the particular problem spare parts posed for manufacturers, the tremendous number of parts to be kept in stock, the very small number off sales in a year, the high storage costs and the unpredictable fluctuations of the demand for such parts, it is obviously hard for the companies to decide how many parts should be kept in stock and where.
For instance, should Massey-Ferguson double its stock of all parts of which fewer than 50 were sold in 1966, they would have to increase by $7.2 million their total inventory of spare parts. Considering the estimated 15 per cent in interest, storage and maintenance charges, annual costs would amount to about $1 million.
While this figure exceeds only slightly 4 per cent of the total number of parts sold by the company, it would

represent 55 per cent of the annual sales of that type of parts.
Of course, each firm must set up the best way of distributing costs for surplus stocks according to the advantage they would gain if they were able to supply spare parts as required. Since farmers insist on the possibility of getting maintenance parts as required, all firms are interested, from a competitive viewpoint in satisfying this demand.
According to testimonies before the commission, most if not all major manufacturers of farm implements have been making a concerted effort for the past few years in order to improve the quality of their spare parts service.
Almost everywhere now, computers are used to set up a careful list of available parts so as to ensure that new parts are ordered as soon as stock for a given part begins to decrease more rapidly than expected.
Moreover, several farm implement manufacturers are trying to improve the level of parts services in their agencies. Agents are individual businessmen and take their own responsibilities concerning the quantity of parts to stock. However, manufacturing firms can exercise a strong influence on these decisions, which they have done so far apparently. A number of firms have given some details on the direction that they give their agents regarding the systematic stock control and forms to use in the stocking of parts.
Moreover, most firms offer their dealers special premiums to push them into storing fast-selling parts before the so-called use period. Several firms suggested the establishment of special arrangements for the return of parts, in order to lessen the risks for the dealer who stocks parts never requested. In spite of these efforts, the commission's report clearly indicated that the dealers' quality and competence often leave much to be desired. It seems in the best interest of the firms to reduce the number of marginal or ineffective dealers, and intensify their efforts to improve the quality of service provided by the remaining ones.
A number of farmers and farm organizations have submitted a proposal that dealers should stock a larger number of parts. Such a proposal does not seem promising as a means to solve the part-stocking problem. We need only look at the data supplied by Massey-Ferguson on the trade of parts in North America. In 1966, this company had 2,643 dealers on this continent. It was keeping in stock a little under 99,000 various parts, but out of this number only 1,561 parts sold more than 3,000 units a year. So, if the individual dealers were keeping in stock all the parts for which the average sales in a year amounted to 1.1 unit or more per dealer, the company would stock only these 1,561 parts, that is less than 2 per cent for all the various parts figuring in the inventory. On the other hand, when a dealer keeps in stock parts whose annual sale amounts to one unit or less, he runs the risk of having some of these becoming obsolete and left on his hands. On the whole, the stocking and distribution costs of spare parts would be much higher.
With regard to seldom required parts, the analysis suggests that the most profitable formula would be to stock parts in a central place and to rely on the swiftness of
April 2, 1974

transportation and communications for their delivery to those farmers who need them. With the development of dealerships, each dealer will be able to stock a greater supply of parts. On the debit side, the longer trips required of the farmer to obtain parts must be taken into account. However, some farmers have said in briefs or before the commission that they are ready to travel greater distances to get parts provided they are sure that the dealer will have them on the spot.
I humbly suggest, Mr. Speaker, that common supply points would be one the best solutions put forward up to now.
According to this evaluation of the problem, what conclusions should be drawn regarding the resolution that companies set up central parts depot? In the opinion of the commission, any advantage of such a system is strongly overcome by its disadvantages. Under the present arrangements, whereby each company is responsible for its parts distribution, it is very easily determined who is held liable for any supply shortage. Since the reputation of each company depends partly on its capacity to offer a quick and reliable parts service, it is entirely to its advantage to develop and maintain a good service.
If the parts were provided through a central co-operative stock, the areas of responsibilities would be much less well defined. It is at least possible that the service would worsen under such an arrangement. Moreover, the service now provided by each company is an integral part of the parent company's parts business in North America. If all the central stocks of Canadian companies were placed under the same roof, we could sever the direct communication and responsibility links which now exist. I am thinking about problems beyond the influence of manufacturers.
Since the very nature of the repair parts problem makes the stocking of a great number of parts in regional and central stockrooms inevitable, the existence of an efficient and quick emergency service requires prompt communication of the farmers' needs, and immediate action by the company to ensure that the farmer's order is filled and delivery of the part will be made as soon as possible. Even though we now live in an era where the rapidity and efficiency of communications and transportation have improved, there are many obstacles to the emergency distribution of spare parts to the farmers.
From a technical standpoint, communications have made a lot of progress. Since all the parts are now registered on computers, some companies pretend that they can find a part anywhere in North America in only a few hours, even if only a few copies exist. The dealers often communicate with the branches by telex. The communication problem seems to lie most often at the human level. The farmer does not say to the dealer that his need is urgent, or else the dealer does not follow the procedure prescribed by the company so that the urgent nature of the order is not recognized at the branch level. The commission's investigation suggests that such errors are more common among smaller and less efficient dealers. Their frequency should diminish as farm machinery companies
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continue to upgrade the level of their dealerships and to reduce their number.
Even when the spare part is in stock at the branch or central warehouse, there can be, for many reasons, considerable delay in delivery to the farmer. The farmers in remote areas must often rely on trucking, bus or express services to get their parts. Trucking companies and express offices do not usually operate on Sunday. At times, bus companies are not too eager to transport huge or awkward parts nor to deliver them to remote spots lacking staff.
Four Canadian provinces, namely Alberta, Manitoba, Prince Edward Island and Saskatchewan have passed laws on farm equipment to regulate and moderate the relations between the three parties interested in the purchase and use of farm equipment: the company, the dealer and the farmer. One of the prime objectives of these acts would seem to be protection of the interests of the farmer in his relations with the suppliers of farm machinery. The dealers are eventually subjected to a licensing system to allow the adoption and the maintenance of minimal standards of production. On the other hand, attempts are being made to guarantee-


Mr. Speaker:: Order. I am sorry I have to interrupt the parliamentary secretary, but his time has expired. Of course, he may continue his remarks with unanimous consent of the House.

Is there consent?


Mr. Knight:: No.


Mr. Speaker:: The hon. member for Assiniboia (Mr. Knight).


William George Knight: Mr. Speaker, I regret my refusal to extend the time of the hon. parliamentary secretary, but I am sure he is aware that this debate will be over at six o'clock and with his great interest in the problem he would not want to prevent my speaking on the subject and allowing the bill then to be referred to committee.
I rise merely to say a few words. In presenting this bill to parliament, the hon. member for Meadow Lake (Mr. Nesdoly) did a notable job of outlining the problems of farmers in all parts of Canada who face a serious situation when farm machinery parts are not available. The hon. member for Meadow Lake, the hon. member for Mackenzie (Mr. Korchinski) and the hon. Parliamentary Secretary to the Minister of Agriculture (Mr. Corriveau) are to be commended for their contributions which show that this question goes beyond mere partisanship. I hope we can end the debate before six o'clock and send the bill to committee so that the whole subject may be investigated and the government enabled to bring forth legislation for this House to consider.
If any hon. member should follow me in this debate he would be doing a disservice to the farmers of Canada by killing the bill and sending it to the bottom of the order paper. I usually speak for much longer than I shall now, but I will curtail my remarks so that the House may allow the bill to go to committee. I hope no other member will

April 2, 1974
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speak, and so allow this most important subject to be referred to the committee on agriculture.


Some hon. Members:: Question.


Mr. Maurice Foster (Parliamentary Secretary to President of Privy Council):: Mr. Speaker, I am happy to have an opportunity to speak on this bill this afternoon. There can be no question that this matter is of great concern to the farmers of this country, so I congratulate the hon. member for Meadow Lake (Mr. Nesdoly) for bringing it before the House. If I had time, I would go into some detail as to whether this problem is more properly dealt with by the federal government or by the provincial governments.
This bill seeks to guarantee a supply of farm machinery parts for a period of ten years. This is an important aspect of the whole problem of spare parts for farm machinery, but equally important is the problem of servicing and providing those parts on a speedy basis when breakdowns occur. Many of us go to farm meetings and hear about the problem of being unable to get spare parts almost on demand, especially during the harvest season when there are many machinery breakdowns and there is a regional or provincial problem in obtaining speedy delivery of spare parts.
At the meeting of the Canadian Federation of Agriculture held last February in Saskatoon, the following resolution was passed concerning farm machinery repairs:
(a)	That retailers keep a sufficient parts inventory to make possible the quick repair of farm machinery, especially during rush periods.
(b)	That farm machinery parts and repair services be offered to farmers during the weekends deemed necessary and during lunch hours.
(c)	That there be more standardization of parts in the farm machinery industry.
(d)	That individual machinery repair parts be made available rather than having to purchase an entire unit.
In addition, a farm machinery committee was established. Its terms of reference include the development of a comparative evaluation of machinery manufacturers-


Mr. Speaker:: Order, please. I appreciate that the hon. member was making a most interesting speech, but it is six o'clock and the Chair must advise the House that the time assigned for the consideration of private members' business has expired.
At six o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.


[Stage Direction]
The House resumed consideration of Bill C-5, an act to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways system and Air Canada for the period from the 1st day of January, 1973, to the 30th day of June, 1974, and to authorize the guarantee by Her Majesty of certain securities to be issued by the Canadian National Railway Company and certain debentures to be issued by Air Canada, as reported (with amendments) from the Standing Committee on Transport and Communications.
Bryce Stuart Mackasey: Mr. Speaker, just before the supper break I rose to participate briefly in the debate. I propose to comment on this bill and on some of the observations of the hon. member for Mississauga (Mr. Blenkarn). Passage of Bill C-5 has been delayed for some time. Members of the House have the right to delay passage of a bill; nonetheless, this has proved to be an embarrassment both to the CNR and to Air Canada because, no matter what some members may think, these companies are entitled to funds for financing. Members, of course, may question that financing.
It seems to me that we were given ample opportunity in committee, under the able chairmanship of the hon. member for Crowfoot (Mr. Horner), to investigate these matters and question officials of the CNR and Air Canada on various aspects of the operations of both corporations. I do not want to debate with the hon. member the Air Canada-Wardair transaction which he mentioned this afternoon-whether Air Canada is paying too much or not enough for 30 per cent of Wardair shares, or whether they should pay 30 times, 15 times, or 10 times earnings. It boils down to how one defines earnings. Do we mean earnings after depreciation, or before; earnings declared for income tax, or for the purpose of corporate tax?
I think the hon. gentleman would agree that this is not the real issue. Unintentionally, I am sure, the hon. gentleman implied that Air Canada agreed to pay to Wardair considerably more than it had to pay. Perhaps I read more into the hon. gentleman's speech than he intended. He is an able debater and I am sure he did not mean to intimate that, even unintentionally.
The fundamental question is, should Air Canada be buying into Wardair at all? What may not have been said-I do not know, since I have not listened to or read every speech made in this debate-is that before entering into this financial arrangement with Wardair, Air Canada obtained the best possible advice from acknowledged experts in the field. Certainly this was mentioned forcefully in the standing committee when this matter was considered during the last session.
The question is, what is Air Canada receiving in return for its investment in Wardair? It is not whether Air Canada paid a fair price. A fair price is a matter of
April 2, 1974

opinion. According to observers and consultants in the aeronautical industry, Air Canada offered a fair price. The question is, is this transaction unique, is it unusual, is Air Canada breaking new ground in acquiring part of the business of another airline? Further, what was its motive, and what will it get in return for its money?
The hon. gentleman said this afternoon, and I agree, that if Air Canada bought into Wardair simply to acquire equipment, the deal was not lucrative since Wardair equipment is limited, much of it being leased. Some of its equipment is useful in fulfilling contracts in the northern territories. Fundamentally, I do not think Air Canada bought Wardair shares in order to acquire more equipment, as it would be better to buy or lease equipment directly from the manufacturer. The intriguing question is, what would Air Canada want with Wardair in the first place?
I should emphasize that other airlines tried to acquire Wardair and failed. The owners of the business, the family group, would not give up their control of the airline business despite the cyclical nature of the industry which has made Wardair and other airlines conscious of the need for liquidity. If you look at the balance-sheet objectively you will see that Wardair improved its financial position consistent with the financial trends in that particular industry.
The significant thing is not so much the evidence that came forward at our committee hearings, but it did whet my curiosity to the point that I obtained transcripts of all the Canadian Transport Commission hearings, which are available. Let us presume, for the moment, I was persuaded by members of the standing committee that it was a terrible deal for Air Canada and a bad deal for the taxpayers that Air Canada, a Crown corporation, pay more than it should for the purchase of shares of this particular firm.
I was rather intrigued. I wondered why all these other corporations such as CP Air, Nordair, and Pacific Western were so publicly minded that they would go to the Canadian Transport Commission hearings and oppose the purchase of 30 per cent of the shares of Wardair by Air Canada. Was this a wonderful gesture on the part of these particular airlines to protect the Canadian people from Air Canada's alleged foolishness? It is nice to know private industry cares so much about the taxpayer that they would go to the Canadian Transport Commission and say they opposed the purchase by Air Canada of 30 per cent of the shares of Wardair. I am naive by nature, but I am not quite that naive. I just could not visualize large corporations such as CP Air, Nordair and two other firms hiring the best legal counsel in Ottawa, Toronto and out west for weeks of hearings simply to protect the Canadian taxpayer against a foolish gesture by Air Canada.
It seemed, there ought to be something a little deeper behind it all than just protecting the average taxpayer from the foolishness of Air Canada. It would be nice to believe this is the reason; however, when you read the testimony you find it is very incidental and not the main purpose at all for the opposition by these carriers to the proposed purchase of Wardair shares by Air Canada. Their opposition to the proposed purchase was legitimate. Cer-
Canadian National Railways and Air Canada tainly CP Air is a very legitimate organization: it has provided the very best in competition for Air Canada, and continues to do so. In case members opposite have any illusions, I tell them to make no mistake about CP Air. I have travelled CP Air as much as the next person, and I have enjoyed it as much as travelling Air Canada. If anything, I find their competition has improved the situation across Canada.
I am not so naive as to think CP Air would appear before the Canadian Transport Commission simply to protect the taxpayers' dollars when Air Canada proposed to buy 30 per cent of Wardair shares. When you read the five or six volumes of the hearings, it becomes very obvious that the fear of CP Air, Nordair and Pacific Western was that collectively Air Canada and Wardair could very well become a monopoly of the air charter business. The affinity group concept is disappearing, or has disappeared, and the shape of things to come is pretty well known in the airline industry. The traveller today wants some kind of package deal, if not for the sake of money at least for convenience. It is recognized there is very little use travelling half way around the world by any airline if you cannot have decent accommodation when you get there.
It is obvious that Air Canada, CP Air and other large competitive airlines realize that in the future they must be able to offer more to the travelling public, especially those who travel in the tourist rather than the business area. They want more than just air travel; they want a complete package.
It is obvious from the testimony given before the Canadian Transport Commission that the concerns, legitimate or otherwise, of CP Air and Nordair are that in the future Wardair-Air Canada as a package would wield a virtual monopoly over this type of operation in the Canadian air industry. This may be a very legitimate concern but it is an entirely different one from whether Air Canada is paying too much for the purchase of 30 per cent of the Wardair company.
I am not a lawyer, but I read the arguments placed before the Canadian Transport Commission with a great degree of envy because each and every company was more than ably represented by counsel: they were obviously specialists in this particular field. However, what decided the Canadian Transport Commission to approve in principle the purchase by Air Canada of 30 per cent of Wardair was the realization that unless this type of merger was made, the Canadian airline industry collectively was in danger of losing a greater and greater percentage of this type of business.
Statistics show that of the 450,000 charter flight passengers-I think that is how you designate these people-who travelled to and from Canada and the United Kingdom, 52 per cent travelled by foreign carriers. That is a considerably higher percentage than in previous years. Of the 48 per cent carried by Canadian carriers, Wardair carried 24 per cent, Air Canada 13 per cent, CP Air 7 per cent and Pacific Western 4 per cent. British Caledonia and BOAC carried 23 per cent.
So it was proven so far as the CTC was concerned that the relationship between Wardair and Air Canada was

April 2, 1974
Canadian National Railways and Air Canada desirable from a domestic point of view, if not necessarily desirable from the point of view of CPA, Pacific Western or some other Canadian airline. The relationship was desirable from the standpoint of improving our ability to compete against foreign-owned airlines. Therefore it seems to me it was either a good deal, in which case Nordair and CPA were quite logical in their opposition, or it was a bad deal. And if it was a bad deal, I cannot see them wasting their money opposing the Air Canada-War-dair deal in the first place.
Much as I appreciate CPA, Nordair and those other companies in whose aircraft we travel from time to time, my gullibility does not extend to the point that I believe they would spend many thousands of dollars in hearings before the CTC to protect a competitor against a bad investment. The reason, as stated at the CTC hearing, was simply that they feared what might happen in the course of time. It was not brought out during the committee proceedings, though it could have been-it had already been made public at the CTC hearings-that if and when the Ward family sells more of its shares, those shares will be sold to Air Canada. So in time, with the permission of the CTC, Air Canada could conceivably assume majority control of Wardair.
I suspect some understanding was reached at the time that Air Canada will eventually own more than 30 per cent of the shares and use its option to take up sufficient shares to be clearly identified as the majority shareholder in the Wardair operation. Without passing judgment on whether such monopolies are good, I would think the CTC was certainly apprised of all facets of Air Canada's proposed transaction with Wardair, the one which is now before cabinet.


The Acting Speaker (Mr. Laniel):: Order, please. I regret to interrupt the hon. member, but his time has expired.


Some hon. Members:: Carry on.


The Acting Speaker (Mr. Laniel):: Unanimous consent of the House is needed for the hon. member to continue. Is there such consent?


Some hon. Members:: Agreed.


Bryce Stuart Mackasey: I do not wish to take up the time of the House unduly; I simply wish to summarize what I have said. There is really a question of accounting methods involved here. The hon. member for Mississauga and I have debated this matter before-whether Air Canada offered 30 times the earnings of Wardair. It depends on how those earnings are assessed. But this is really incidental to the question whether or not Air Canada and Wardair should be linked.
Incidentally, and in conclusion, I wish to point out that a relationship between a national carrier and another operator is not unusual. We find that with BOAC, KLM, Swissair, Scandinavian Airlines-virtually every nationally-owned airline in the world. The objection raised to what Air Canada proposes was logical and understandable in light of the competitive situation, but the CTC based its decision upon the fact that unless such a relationship was permitted, year by year, as evidence showed, the Canadian

airline industry would lose more and more Canadian business.
The commission ruled, not in the light of whether Air Canada would improve its position vis-a-vis CPA but whether the Canadian airline industry as a whole would be able to retain at least 50 per cent of the charter business operating to Europe. Indications are that as a result of this proposed merger, if it is approved by cabinet, Air Canada will be in a position to meet successfully the erosion of its revenue by the charter business which has been going on steadily for the last couple of years.


Some hon. Members:: Hear, hear!


Sinclair McKnight Stevens: Mr. Speaker, I rise to speak on the amendment moved by my hon. friend from Mississauga (Mr. Blenkarn) because I think members of this House have little choice but to speak up when we feel there has been a wrong done to the House of Commons. I am referring to the fact that through trickery an amount was voted here last Tuesday night-the sum of $28.8 million-which was passed under the Appropriation Act in a few minutes but which should not have been passed.


Mr. Benjamin:: Explain.


Sinclair McKnight Stevens: In the course of my remarks I shall outline a complete pattern of failure to disclose certain information to members of the House and to the Canadian public who should be entitled to the facts.


Leslie Gordon Benjamin: Explain the last remark you made.


Sinclair McKnight Stevens: I am referring to the fact that there is an option outstanding with respect to the purchase of up to 32 per cent of the outstanding shares of de Havilland of Canada Limited in the amount of $28.8 million. We have endeavoured in committee and elsewhere to determine whether it is the intention of the government to go ahead with this project, and on each occasion we have been told the question is still not decided. At the last meeting of the finance committee, the Minister of Industry, Trade and Commerce (Mr. Gillespie) insisted that the estimate be considered, yet he positively declined to give the committee the opportunity to look at the financial statement of de Havilland of Canada Limited. I think this is most unfortunate. Financial statements concerning de Havilland are available to us though they are not up to date. We know the company has sales valued at $35 million and that it is marginally profitable. We were absolutely startled to find the government seriously considering exercising an option to purchase all of the outstanding shares of that company for an amount that it estimates to be between $28.8 million and $38.8 million.
Let us put the matter in perspective. I am referring to a company with sales of $35 million and marginal profitability which the government is seriously considering purchasing for between $28.8 million and $38.8 million. Yet the parent of that company, the Hawker Siddeley group in England, have another subsidiary in Canada called Hawker Siddeley Canada Limited. I find it relevant to note that this subsidiary has sales of $200 million and a profitability after taxation of $3 million. This company is
April 2, 1974

selling on the Toronto Stock Exchange today for $50 million. In short, it would be possible for the government of Canada, if it is serious about buying into the aerospace field, to purchase virtually all the stock of a profitable, ongoing company six times the size of de Havilland of Canada for very little more money than it is proposing to put into de Havilland of Canada.


Leslie Gordon Benjamin: They should buy it.


Sinclair McKnight Stevens: My hon. friend to my left says we should buy it. I am sure the NDP would buy anything if it meant state ownership in this country. They lust for power. I think the Minister of Finance (Mr. Turner) in particular should note that these members will buy anything sight unseen. When we attempted to have the estimate with respect to de Havilland reduced in committee, government members, joined by their allies in the NDP, said, "We don't care what the statement of de Havilland looks like. We don't care whether or not it is earning money. We want that estimate to go through".
That is a broad outline of what I should like to deal with tonight when considering the motion before the House. However, the story is bigger that I have indicated, because de Havilland is only one company which the government is proposing to purchase. There is a second company, Canadair, owned by General Dynamics, which happens to have its main plant in Canada in the riding of Dollard. Whether that has any connection with the fact that the riding of the Minister of Supply and Services (Mr. Goyer) is Dollard is not for me to say. However, the minister indicated today that he was willing to pay a dollar for a gallon of oil that one can buy for 25 or 30 cents, so if he has had any input into the purchase of Canadair we as members of this House should be highly suspect of any such purchase.
Let me deal with a few specifics, Mr. Speaker. In the transport committee in December we attempted to explore a deal which was prepared by Air Canada and Comstock International entitled "Proposal for rationalization of the Canadian aerospace industry". This proposal dealt with the possible merger of de Havilland with Canadair to which I have referred. The proposal is nicely bound within glossy covers, sets out pro forma balance-sheets and indicates that generally speaking the government is expected to pay for practically everything yet will not necessarily end up with even 50 per cent of the equity ownership.
This came to us, as Mr. Pratte, the president of Air Canada, pointed out, through a leak. He was highly disturbed that this proposal had been, as he said, leaked to the opposition benches. While during the committee hearings Mr. Pratte and the newly elected president at that time, Mr. Vaughn, were quick to point out that we should not take this document too seriously, that it was only a working paper which they would not necessarily follow, they forgot that they had already written a letter dated October 29, 1973, addressed to Mr. C. D. Arthur of the Department of Industry, Trade and Commerce in which they had this to say:
We ... look forward to the opportunity of working closely with your department to bring (our proposal) to fruition.
I am referring to this merger of de Havilland and Canadair. I note that when discussing the anticipated results of
Canadian National Railways and Air Canada the proposal-and undoubtedly NDP members will rejoice on hearing this-it was stated that one of the advantages would be to bring about a closer liaison with government officials, with the head office being located in Ottawa. I make reference to this, Mr. Speaker, because in our questioning we tried to get from Mr. Pratte an understanding of why the government would seriously consider paying $22 million for Canadair and $25 million for de Havilland. Any time we referred to a total purchase of $47 million we were told by Mr. Pratte and Mr. Vaughn that the document was nothing more than a preliminary proposal.
I point out that in their financial statements it was indicated that if these two companies were joined together, it was thought that by 1980 they would have a combined sales volume of $120 million to $150 million, and that Canadair would make 2.7 per cent to 3.7 per cent profit during the next ten-year period of investment. With inflation at the present time running, thanks to our Minister of Finance, at 9 per cent to 10 per cent, the government is seriously considering an investment that it thinks will yield 2.7 per cent to 3.7 per cent in a ten-year period.
I am not going to take up hon. members' time to read all the conditions attaching to the proposal, but if all conditions are met it is stated that it is felt the company would be viable and profitable. I suggest, Mr. Speaker, that it is natural that they would take that attitude, because they know that the two companies they are attempting to merge will find it extremely difficult to make money in the highly competitive, energy short era in which we now live so far as the manufacture of aircraft is concerned.
They project that this $47 million investment will yield a sales potential in the year 1980 of $150 million, presumably totally ignoring the fact that they can buy Hawker Siddeley Canada Limited for $50 million, a company already having sales of $200 million and yielding a $3 million profit. I suggest that this is the irrational type of behaviour with which we are having to live so far as certain Crown corporations and the government of this country are concerned.
I now come to the main reason for feeling I had a duty tonight to put before this House and the public of Canada some hard facts. I see no reason why taxpayers' dollars should be channelled into an investment unless those who wish to do the channelling accept the responsibility of putting statements on their proposed investment before the House so that members can review them and make up their own minds whether the investment that is proposed is worth while. Again, I am pleased to see the Minister of Finance here tonight, since it may well well be that he does not know what kind of deals are being made under his skirts as far as certain departments of this government are concerned.
Let us come to some of the specifics. When he appeared on December 17 before the transport committee, I asked Mr. Pratte whether he could furnish the committee with the statements of Canadair and de Havilland. At that time Mr. Pratte said-I emphasize this-that he would supply these to us through the chairman as soon as he got back to Montreal. That was the commitment by Mr. Pratte of Air Canada. He promised us statements for de Havilland and

April 2, 1974
Canadian National Railways and Air Canada Canadair, but these statements have not been forthcoming: the chairman of the committee has heard nothing further from Mr. Pratte in this respect.
Mr. Pratte, when we attempted to get some justification for proposing to pay $47 million for these new companies, suggested that after all this was only a working document and he felt we should not be pressing as though this transaction was a fait accompli. When we indicated that the natural thing to do was to get an assurance from Mr. Pratte and Mr. Vaughn that in the meantime, between that committee meeting and June 30, 1974, they would not buy the shares of de Havilland or Canadair, leaving us with no opportunity to review the deal, the president of Air Canada gave us this commitment. I asked him the following:
-what assurance can you give us that by June 30, 1974, you will not become obligated with respect to the purchase of Canadair or de Havilland as set out in this proposal?


Mr. Pratte:: I have offered at the last meeting to give that assurance to you, sir, and to members of the committee.
He went on to say:
-I can certainly give you the assurance that there will be no commitment to subscribe or to permit any money for the purchase of any interest in Canadair or in de Havilland or in any company that would have any interest in de Havilland or Canadair.
I said:
I am relieved to hear that.
When I pressed Mr. Pratte, he went on to say that they might have to spend half an hour or so actively pursuing the deal if they were requested to do so. I asked him if he would also give assurance that he would not press the deal further, and he said:
However, in terms of committing money, or committing ourselves to go into that proposition having to do with de Havilland or Canadair, I am prepared to give a commitment at any time.
I repeat, "half an hour or so"; and that is the way it was left at the committee meeting. We pressed him for further assurances and we were left with what I regarded as a clear undertaking that there would be no commitment on the part of the government of Canada or any Crown agency of the government to purchase the shares of de Havilland or Canadair between that date and June 30. That is why I believe hon. members will understand my surprise when I found in the main estimates tabled in this House by the minister responsible for Treasury Board an estimate in the amount of $28.8 million, being vote L20, for the payment in current and subsequent fiscal years in accordance with the terms and conditions approved by the governor in council for the purchase of shares of the capital stock of de Havilland of Canada Limited.
We had a commitment from the president of Air Canada that between that date and June they would not purchase the shares of de Havilland. Then we had an estimate tabled in this House and, as I said earlier, this question came up for review before the Committee on Finance, Trade and Economic Affairs. At that time I asked the Minister of Industry, Trade and Commerce whether he would be good enough to give us the statements concerning de Havilland so that we as members of the committee could decide whether this $28.8 million was an appropriate amount to pay for de Havilland. We were told flatly that this was a confidential document and would not be turned

over to us. I refer to the Minutes of Proceedings and Evidence of the committee for March 26, page 2:26, when I asked the following:
Mr. Chairman, could the minister then furnish the committee, so that we may tell whether the $28 million figure is a fair new estimate, with de Havilland's statements for the past five years showing balance-sheets, profit and loss picture for this company?


Alastair William Gillespie: I believe that is private to the company itself, Mr. Stevens. I cannot give you that undertaking.
Keeping in mind that we had the president of Air Canada assure us he would deliver the statements, that under no circumstances would they be committed to buying this stock but that in the interval they might have to spend half an hour discussing it, the minister went on to state:
A good deal of work is being done by my department to assess the potential of the firm.
Again I asked whether we could have the financial statements for this company and the minister replied:
Those are confidential to the firm.
I then asked:
Have you requested de Havilland or the Hawker Siddeley people if they have any objection to making these statements public so that they can be properly reviewed at this committee?


Mr. Deputy Speaker:: Order, please. I regret to interrupt the hon. member, but his allotted time has expired. However, he may continue his speech if there is unanimous consent. Is this agreed?


Some hon. Members:: Agreed.


Sinclair McKnight Stevens: Thank you, Mr. Speaker. The minister went on to state that he would make the statements available at the appropriate time. I suggested that the appropriate time was then and there, if he wished the estimates to be passed. And this is what I regard as sheer trickery: unknown to me, there was placed on the order paper of this House a notice that it was proposed to pass item 25 of the estimates of the Department of Industry, Trade and Commerce, vote L20, in the amount of $19,731,000. I was not aware of that until Tuesday evening when we were furnished with an appropriation bill in which I noticed a reference to de Havilland and the amount of $28.8 million. I suggest that no member of this House had the opportunity to debate that amount. We had only a fleeting moment to realize that the amount was being passed by the parliament of Canada.
Let us take a clear look at this matter. The statements of the Hawker Siddeley group of England are quite clear as to their investment in de Havilland. They spell it out much more fully than did the Minister of Industry, Trade and Commerce. These statements point out that there is an option outstanding in the name of the government of Canada to purchase shares in de Havilland on or before June 28, 1974. At the committee hearing the minister admitted that the government wanted the estimates passed in order to meet the deadline of June 28, 1974.
In what position does that put the members of this House when in committee we have a firm undertaking from the president of Air Canada that under no circum-
April 2, 1974

stances will he buy de Havilland shares for any price, and we have the Minister of Industry, Trade and Commerce telling us that he must have an estimate cleared and who, through trickery, gets it cleared through the Appropriation Act knowing that he has to make the deal by June 28 and he will do it or the deal is lost? Surely that is not being fair to the members of this House or to the public of Canada. What are they hiding in this de Havilland deal? For what reason will they not table the relevant documents and statements and in some way try to gain the confidence of this House which I sincerely believe they have lost? They need to gain the confidence of the House in the method they are using with respect to the purchase of these companies.
It may be that de Havilland is a good purchase and it may be that Canadair is a good purchase, but it would take a lot to convince me. But at least the people of Canada are entitled to see the profit and loss statements of these companies before we have this irresponsible trickery on the part of a minister who feels he is entitled to the confidence of the House.
Those are the reasons for which I have risen to speak on the motion before us. I believe that the CN financing bill is one which we have no alternative but to scrutinize closely, particularly when we are treated in the way I have indicated with regard to the purchase of a new Crown corporation by this government. How can one have confidence when one looks at these companies and finds that, while there is a nominal profit in relation to capital in Air Canada of $17 million before taxes, there is a deficit of $17.8 million in the CNR? Then one is told to go ahead and pass the CN financing legislation when we know that in all likelihood some of the silliest imaginable deals will be made unless someone in the House calls it for what it is. We were "had" on the oil purchase last November, and we are going to be "had" on the purchase of shares in June, or before if members of the House do not realize what is going on.


Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, in rising to debate the motion before us I wish to speak about Air Canada operations. It is ironic that Air Canada celebrated its thirty-fifth anniversary yesterday and in a news release from the Department of Transport the minister's message reads:
Air Canada today enjoys a reputation second to none in world aviation for flight safety and good service.
I cannot agree with that statement at all. I would suggest that the Minister of Transport (Mr. Marchand) consult the employees of Air Canada, speak to the general public and to members of parliament. I also suggest that he review the Hansard index, when he will see how many times Air Canada has been the subject of criticism in the House. Also, I suggest that he read the 70-page document which contained condemning criticism of Air Canada from A to Z. Of course, we all know the number of strikes that Air Canada has had over the past number of years, and I bring that fact also to the attention of the minister.
One aspect which I would like to discuss this evening is air safety in Air Canada. Last fall, Air Canada stated that a safety study had been undertaken in conjunction with the unions, and the committee on transport and communications was told that everything was O.K. The committee
Canadian National Railways and Air Canada was informed by Mr. Pratte that air safety was controlled by employees filing union grievances. We were told that unions had no safety complaints. I would like to quote from a newspaper article which reads as follows:
-Yves Pratte, chairman of the airline, told the committee the allegations were not based on any facts since employees "who have any doubt about any safety feature, have an obligation to report their doubts to their union safety officer and have it processed as a grievance."
However, no worker had reported any safety preoccupations of any kind in the past year, so that the allegations could not possibly be founded.
I will prove otherwise as I have documents that were submitted to Air Canada on safety infractions at Dorval. In the latest airline lodge news there appears a complaint from the employees at Dorval which I would like to read into the record. It states:
Unfortunately, the shop stewards in customer service have to deal with first level Air Canada supervisors that are not interested in resolving grievances or applying the collective agreement. The supervisors' only concern is trying to run a schedule operation at all costs. The result of this attitude causes one of our largest problems and most frequent violation of the collective agreement, i.e. 'SAFETY'. The collective agreement is quite clear in that management is specifically charged with the duty of initiating and monitoring all practices necessary to ensure the safety and health of employees as well as ensuring the safety of all equipment.
Because of the attitude of first level supervision and their refusal to initiate safety, the shop committee is presently handling the problem at the second level of the grievance procedure which is the regional vice-president or his designated representative.
Last fall I read into the record a complaint from a lady in Vancouver who stated:
On November 23, 1973, I boarded Air Canada's flight 280 to attend an archaelogical symposium at the University of Calgary. Within twenty minutes of take-off, I experienced that sense of continuous "ear popping" (for want of a proper medical term). The aircraft became instantly chilled and to my horror, the oxygen cabinets opened and we were instructed to use the orange masks. You can well imagine the anxiety especially among the more aged passengers. In addition, not all the masks produced oxygen, the man sitting next to me tried in vain to operate his, but without success.
Now if Air Canada's flights are so well supervised during maintenance and repair, why was this overlooked?
Apparently the problem still exists in Air Canada. You would think they would take immediate action to rectify it. Last Tuesday, March 26, an Air Canada flight out of Quebec City while climbing at 14,000 feet lost cabin pressure. Of the masks deployed, only 40 per cent supplied oxygen. So the problem is still with us. Last fall, eight employees at Dorval submitted a document to the maintenance quality supervisor of Air Canada. This was signed by four former Manitobans and four Quebeckers. I should like to read some of their comments into the record as follows:
It is our opinion that the quality audit program has not been thoroughly and adequately developed. Many managers, lead mechanics, mechanics and others are not fully aware of the quality audit program and its objectives. It is not sufficient just to have an 862 Maintenance Quality Manual; shop personnel must be made aware of the basics of the inspection function. Either 901 Manual instructions or other means to inform personnel is considered necessary.
In our opinion the quality audit program is not working as it was designed to do. In one or two areas it is receiving token acceptance but no efforts are made to prevent discrepancies from reoccurring, eg., errors reported are given attention but that is all that is done. In some areas, virtually no attention is given to audit reports-as evidenced by quality audit annual summaries.

Canadian National Railways and Air Canada
We feel that the quality inspection department cannot function properly without regular meetings for the purpose of evaluating the inspection program, keeping aware of organizational, administrative and policy changes, general information, beefs, etc. For example, we learn of staff changes and other relative information via the grapevine.
We have never been asked but our collective experience suggests that a program of direct inspection (with proper ratios of inspectors to production personnel in all required areas) followed up with audits at suitable intervals would be of greater benefit and have a better chance of meeting the prescribed standards of the 862 Maintenance Quality Manual.
I would like to point out that it is not the union grievance that are raised with regard to air safety standards, but that these standards are laid out in the 862 Maintenance Quality Manual. They go on to explain the ratio of inspectors to mechanics in the various areas, and these are far below standard. The grievance continues:
Presently there exists two inspection formats, i.e., audits and direct physical type methods. Some inspectors are totally involved in audit reports only; other inspectors apparently are not involved in audit report writing and only do direct inspection. Some work areas, e.g., radio, process and paint shops do not have either type of inspection. Unit and support shop inspectors feel the above is inequitable and disregards the intent of the inspection function.
This certainly challenges Mr. Pratte's statements to the transport committee.
The change from direct inspection to the audit report methods has resulted in many changes for unit and support shop inspectors. Previously the inspection function did not necessitate the following: Presentation of discrepancies in written form. Constant adjustment to a program which has seen many changes in the methods of presentation and which involves a very high degree of verbal instructions.
Investigative work outside the immediate shop area. Development of forms to suit the distinct areas (pioneering of audit program). Responsibilities to discuss and explain audit findings at the general foreman level.
The above changes have taken place without benefit of any monetary adjustments or company consideration of the difficulties arising from the new inspection format. Of particular concern is the requirement to submit written evidence of our fellow unionists' errors or discrepancies.
Erosion of the status of shop inspectors is considered to have taken place in recent years. Shop inspectors do not have the same respect they formerly had. Most managers have never accepted the audit program, as evidenced by the lack of action and lack of answers to the audit reports.
It seems ironic and unjust that unit and support shop inspectors, the group within Air Canada which has pioneered and developed the audit program, should be so low in the esteem of management that we have lost our full-time stenographic support and indeed some of our identity by the integration of our employee pay roster into the paint shop.
It is difficult to understand the logic of having unit and support shops under the supervision of the power plant organization, which is remote and presently believed to be functionally different. Since the relocation of the P.P. shop, unit and support shop inspectors rarely have any contact with the superintendent of quality inspection.
Interpretation and general understanding of the 862 Manual is apparently left to the discretion of the individual inspector. Unfortunately not all inspectors are in possession of an 862 Manual. Four only out of the eight inspectors in this formation have these manuals.
It is no wonder the oxygen masks are not working on Air Canada planes.
It is a source of embarrassment to be an inspector submitting written reports of area discrepancies and at the same time knowing that many areas of 901 Forms and Report Manual Instructions are incomplete and out of date. Instructions in these areas require a complete examination 
April 2, 1974
to revise (update) and rectify the many and varied discrepancies. Simple procedural instructions for certain applications appear never to have been completely formulated or finalized, e.g., modification instructions are incomplete in that the location within the shop area for filing modification instructions is undesignated.
Revisions that are made to the forms and reports section of the 901 Instruction Manual, which are of important significance to shop inspectors, are not forwarded to them. Policy changes, standards revisions etc. are made without any notification being provided to shop inspectors. This condition also applies to 911 Manual Instructions. A current example is the "release permit" now in use but for which there is no information provided to the shop inspector.
There exists a number of areas where an inspector is not able to find concrete policies and is left without any information to guide or direct him. Some examples:
Reference the MOT letter of approval, the terms "standards acceptable" is not defined. (MOT inspection information is not readily available.
Required measuring or testing equipment is unavailable and reported in audits. If action is not undertaken, what is the appropriate procedure, when and by whom?
To what degree is it allowed for maintenance engineering to deviate from manufacturer's specifications e.g. allowing units to have a visual check only, due to test equipment not being available, deletion of specified tests from the vendor's manual for the same reason?
Is the procedure to audit inspect supplier and subcontractors being followed; is it an MOT requirement? If so, who is responsible to ensure its compliance?
Why is there no formal contact between shop inspectors and MOT regional staff inspectors?
In the interest of highest possible standards we seek to know why FAA representatives' visits are preannounced allowing abnormal cover-ups to be carried out.
Unit serialization policy, shelf life expired units policy, modifications etc. are considered to be unclearly defined and in need of attention.
We feel that the work responsibilities and skills of shop inspectors involved in quality audits are equal to, if not greater than those of shop foremen, engineering technicians, planners etc. However, to our knowledge, no meaningful consideration has been given to this matter by management.
Unit and support shop inspectors believe that they are limited in opportunities unjustifiably, both within the inspection department and the shops where they have originated. Promotional opportunities and even relief assignment experience in the respective shop areas are generally non-exitent. No consideration is given for shop advancement to shop inspectors; in other words, to become a shop inspector is to be ignored within your own area for any advancements. Considering the kind of experience gained in this category, this condition is considered a disadvantage to the inspectors and to the company. In general, promotional opportunities within the inspection department are few and the practice has been to award positions above foreman to personnel from outside the inspection department. This too, we feel, is a disadvantage not only to the inspectors and the company but also to the individual who has not had actual inspection and audit report experience.
The major and underlying reason for the creation of this submission was and is the existing low morale and the fact that all eight inspectors are planning in one way or another to leave the inspection department.
There are many workers with Air Canada who cannot wait to get away from the place and take early retirement at age 55. They go on to explain in this submission:
One inspector is currently bidding on another position. One other is on loan and hoping to become a permanent instructor. Two are awaiting lead mechanic bulletins (one of which is expected to be actioned by November, 1973). The remaining four are contemplating early retirement.
We realize that this is a very critical submission but must emphasize that its purpose is in the interest of creating a better maintenance

quality product. It has been compiled and endorsed by all eight unit and support shop inspectors in this formation.
It is no wonder the vice-president in charge of maintenance at Dorval has been replaced. But I do not think that is enough.


Mr. Blaker:: He has not.


A. Daniel McKenzie: I am quoting from the Toronto Stm of March 24, 1974, where the following appears in Doug Fisher's column:
Meantime, over in the head office world of Air Canada, Yves Pratte, the chairman, has reached into the U.S. to hire a boss of maintenance for the national carrier, apparently in a determination to get costs down in this aspect of the company's spending. It's a sad commentary on the ability of our airline industry to produce capable administrators.
If this statement is wrong, as the hon. member has stated, we will know when I check it out tomorrow; but it is my information that the vice-president of maintenance has been replaced.
With these statements, Mr. Speaker, I would suggest to the Minister of Transport that he launch an immediate investigation in to the whole Air Canada operation, their morale problems and air safety.


Mr. Deputy Speaker:: Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: No.


Some hon. Members:: On division.


Stanley Howard Knowles: Nobody said yes.


John Napier Turner: They said on division.


Mr. Deputy Speaker:: Is it agreed that the said proposal is negatived on division?


Some hon. Members:: Agreed.
Motion No. 4 (Mr. Blenkarn) negatived.


Mr. Deputy Speaker:: We now proceed to motions Nos. 3, 5 and 6. It is my understanding that points of order will be raised with regard to Nos. 3 and 5 standing in the name of hon. member for Central Nova (Mr. MacKay). It is the feeling of the Chair, as was indicated earlier, that these are perhaps out of order. I understand that the hon. member for Mississauga (Mr. Blenkarn) is prepared to do battle on behalf of his colleague, and I call upon him to defend the motions. The hon. member for Mississauga on the point of order raised by the Chair.


Donald Alex Blenkarn: Mr. Speaker, I understand the concern of the Chair, but the motions really only require an addition and do not reduce the amount of the loan or in any fashion affect the position of Her Majesty in making a recommendation to the House. All that happens is that they direct that the financial statements filed by the railway and by Air Canada in connection with the advances contain the information that would normally be given to any lending institution when an advance is made.
Canadian National Railways and Air Canada Considered in that vein, there seems to be no reason that these amendments should not be in order.
It has been suggested to me that if they alter the terms of Her Majesty's recommendation, then perhaps they are out of order. But they do not. All they do is require the detail of expenses that would normally be given to any other corporation in accordance with regular corporate practice. All they do is insist upon disclosure. They are not amendments that in any way reduce the amount of the advance. All they do is ask for particulars from the corporations as to the detail of the advances and as to the conflicts of interest and expenses that might be incurred as a result.
The amendments are not of a nature that would interfere whatsoever with Her Majesty's recommendation. Indeed, they are the kind of thing that should have been in the bill in the first place. In a sense, they are housekeeping measures and the Minister of Finance (Mr. Turner) should be prepared to go along with them. They are not the kind of thing that indicate there is any restriction on the advance of funds. They really require, as a condition of a loan, that a report be available. Surely that is a normal condition.
They do not in any way affect the royal recommendation but merely add provisions in connection with information that would normally be available in any case. I say that these are housekeeping measures and are therefore quite in order. In my opinion Motions Nos. 3 and 5 standing in the name of the hon. member for Central Nova (Mr. MacKay) should be put to the House.


Mr. Deputy Speaker:: The Minister of Finance (Mr. Turner) on the same point of order.


John Napier Turner: Mr. Speaker, with respect to motions Nos. 3 and 5, I submit that requiring as a precondition of a loan the annual report of Air Canada in one instance, and the Canadian National Railways system in the other, and submission of a list of the remunerations and expenses paid to the directors and executive officers of the companies is out of order in each case. First, because they are irrelevant to the aspect of financing set forth in the bill; second, because they are beyond the scope of the bill; third, because they are beyond the scope of the act to which the bill refers. They are quasi-amendments in the respect that there are no conditions of this sort in the underlying statute governing both the Canadian National Railways system and Air Canada. For these reasons, on the grounds of irrelevancy and scope, I would submit to Your Honour that the amendments are beyond the competence of the House at this stage.


Mr. Deputy Speaker:: I thank the hon. member for Mississauga (Mr. Blenkarn) and the Minister of Finance (Mr. Turner) for their contributions on the point of order that originally was raised yesterday by the Chair with regard to the relevancy of motions Nos. 3 and 5.
Both of these motions would attach conditions to the proposed guarantees and introduce certain requirements which, in the opinion of the Chair, would be foreign to the substance of the bill and would relate to the context and form of the company's annual report. The hon. member for Mississauga has argued that such conditions should have

April 2, 1974
Canadian National Railways and Air Canada been in the bill in the first place, and I suppose they could. The hon. member also argued that they do not affect the royal recommendation, and that they are housekeeping measures. But the fact is that they would form a substantial departure from the measure that we have before us as it was approved by the House on second reading. I think they are foreign to the substance of the bill. I would quote from May's eighteenth edition, page 508, paragraph (1) as follows:
An amendment is out of order if it is irrelevant to the subject matter or beyond the scope of the bill-
For that reason I would have to say that motions Nos. 3 and 5 as they stand at the report stage cannot be presented to the House.
Perhaps I should put the motions on the record. The hon. member for Mississauga (Mr. Blenkarn), for the hon. member for Central Nova (Mr. MacKay), moved motions Nos. 3 and 5 as follows:
Motion No. 3.
That Bill C-5, an act to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways system and Air Canada for the period from the 1st day of January, 1973, to the 30th day of June, 1974, and to authorize the guarantee by Her Majesty of certain securities to be issued by the Canadian National Railway Company and certain debentures to be issued by Air Canada, be amended in clause 7 by inserting therein, next after line 6 on page 5, the following:
"(3) It shall be a condition to which a loan made under subsection (1) is subject that the annual report of Air Canada, first made after the ending of the period referred to in that subsection, shall include, in respect of each of the directors and executive officers of Air Canada, the amount paid to him by way of salary, other remuneration and expenses, the terms of his tenure of office, and the duties of his office."
and by renumbering subsequent subclauses accordingly.
Motion No. 5.
That Bill C-5, an act to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways system and Air Canada for the period from the 1st day of January, 1973, to the 30th day of June, 1974, and to authorize the guarantee by Her Majesty of certain securities to be issued by the Canadian National Railway Company and certain debentures to be issued by Air Canada, be amended in Clause 9 by inserting therein, next after line 14 on page 7, the following:
"(2) It shall be a condition to which a loan made under subsection (1) is subject that the annual report of the National Company for the calendar year 1973 shall include, in respect of each of the directors and executive officers of the National Company, the amount paid to him by way of salary, other remuneration and expenses, the terms of his tenure of office, and the duties of his office."
and by renumbering subsequent subclauses accordingly.
We now turn to the point of order in connection with motion No. 6, in the name of the hon. member for Central Nova but moved by the hon. member for Mississauga, which reads as follows:
Motion No. 6.
That Bill C-5, an act to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways system and Air Canada for the period from the 1st day of January, 1973, to the 30th day of June, 1974, and to authorize the guarantee by Her Majesty of certain securities to be issued by the Canadian National Railway Company and certain debentures to be issued by Air Canada, be amended in Clause 13 by deleting line 6 on page 9 and substituting therefor the following:
"the 1972 fiscal year of the Na-".

As I have indicated, the Chair has certain reservations concerning the relevancy and admissibility of motion No. 6. I gather that the hon. member for Mississauga is prepared to speak to the point of order.


Donald Alex Blenkarn: Mr. Speaker, motion No. 6 is different from Motions 3 and 5 on which Your Honour just, ruled. It was suggested that motion No. 6 might be defective in that it is consonant neither with the provisions of the recommendation accompanying the bill nor the title of the bill. First, I maintain that there is no difficulty whatsoever with respect to the title of the bill. Clause 13 refers to the purchase by the government of CNR preferred stock. This is mentioned nowhere in the title of the bill, therefore the title applies verbatim whether the amendment is passed or not. In addition, I draw your attention to citation 409 which points out that the title of a bill can be amended and if such an amendment were necessary it would be done on the motion for final passage. I do not think that the title matters in this case.
The first point made was that the amendment might not be consonant with the terms of the royal recommendation which specifically mentions the authorization by Her Majesty to purchase preferred stock up until December 31, 1973. It is important to note that the recommendation is for the purchase of preferred stock up until December 31, 1973. The key citation in Beauchesne's referring to the financial initiative of the Crown, citation 246(3), reads:
The guiding principle in determining the effect of an amendment upon the financial initiative of the Crown is that the communication, to which the royal demand of recommendation is attached, must be treated as laying down once for all (unless withdrawn and replaced) not only the amount of a charge, but also its objects, purposes, conditions and qualifications. In relation to the standard thereby fixed, an amendment infringes the financial initiative of the Crown, not only if it increases the amount, but also if it extends the objects and purposes, or relaxes the conditions and qualifications expressed in the communication by which the Crown has demanded or recommended a charge.
This citation, which is a direct quote from May's, comes under the heading "The royal demand or recommendation fixes the limits of the charge". The citation sets out very clearly the limits which are placed on the ability of a member to move for increases in expenditure beyond the royal recommendation. In short, any amendment which in any way increases the financial obligation of the Crown is not permissible. The royal recommendation sets out precisely the upper limit of what can be spent and to what purpose it can be allocated.
However, this citation does not refer at all to the member's ability to reduce the amount to be paid out, which is what the amendment submitted is all about. In other words, there is nothing wrong with a member moving an amendment to reduce an amount of expenditure. That is perfectly proper. It is only when the expenditure is to be increased or extended that it is beyond the competence of a member to move an amendment.
Beauchesne's does not deal specifically with reducing the amount recommended, but May's does. In the eighteenth edition, at page 744, under the heading "Provisions involving the reduction of charges", May says:
No special form of procedure applies to proposals to reduce existing charges, and they may be moved in the House or in committee without the royal recommendation.
April 2, 1974

This is clearly the practice we follow, the practice accepted by the Chair's acceptance of motion No. 1 which also reduces the amount to be spent. May goes on to make it clear what sort of amendments for reductions are in order. He says:
A proposed reduction of a charge may consist in reducing its amount, or restricting its objects or inserting limiting conditions, or shortening the period of its operation.
Clearly, this is what is being done in this particular amendment. The amendment seeks to remove reference to the year 1973. We are saying that the advance for the purchase of preferred stock in the Canadian National system can only be made with respect to the year 1972, not 1973. The amendment would drop one year. It seeks to reduce the amount of money which can be advanced to the national system.
I suggest that this is acceptable as the royal recommendation sets the upper limit on expenditure in this House. In no way does the royal recommendation insist, nor can it be so construed, on setting both a minimum and a maximum. Here we are talking about reducing the upper limit, about the purchase of stock on the basis of the 1973 year-end statement of the Canadian National system.
I will refer to one example of an instance in which the Chair allowed an amendment which, if passed, would have rendered inoperative the precise wording of the royal recommendation. The House will recall the lengthy debate on Bill C-203, an act to amend the Canada Elections Act, the Broadcasting Act and the Income Tax Act in respect of election expenses. The royal recommendation for Bill C-203 read in part:
His Excellency the Governor General recommends to the House of Commons a measure to amend the Canada Elections Act, the Broadcasting Act and the Income Tax Act in respect of election expenses; upon receipt of the prescribed certificate of the Chief Electoral Officer, to provide for the reimbursement to candidates who are elected or who obtain a number of votes equal to 20 per cent of the number of votes cast in the appropriate electoral district to the extent of sixteen cents for each of the first twenty-five thousand names appearing on the preliminary lists of electors for their electoral districts and fourteen cents for each additional name-
And so on. You will recall, Mr. Speaker, that the bill was amended. The percentage of subsidies was raised to 20 per cent, even though this was in excess of the royal recommendation. That amendment was allowed.
In the amendment before the House we are asking for a reduction in the amount of money which can be advanced for the purchase of preferred stock in the Canadian National system. There are many reasons for this. In one sense, the financial statement for the year ending December 31, 1973, has not been available to this House, yet the royal recommendation now before the House calls for the pruchase of capital stock up to and including the period ending December 31, 1973. In a sense, the provision we are now seeking to amend is out of line with the royal recommendation because the amount of capital stock which can be purchased cannot be computed until we receive the financial statement for the Canadian National system for the year ending December 31, 1973. The stock would have to be purchased before December 31, 1973, and it would have to be on the basis of statements received before the year even ended. In a sense, the present bill is therefore beyond the royal recommendation.
Canadian National Railways and Air Canada
All we are attempting to do is to reduce the provision in the bill for the purchase of capital stock back to the royal recommendation. Therefore, I suggest that this amendment is clearly in order. Indeed, it is probably more in order because of the royal recommendation than in spite of it.


John Napier Turner: Mr. Speaker, I want to make three submissions to Your Honour to the effect that this amendment is out of order. First, the amendment would render the bill inconsistent with the royal recommendation; second, the bill in its own terms provides for a continuous style of financing over an 18-month period; that this financing hangs together by way of borrowing authorization of the two companies or by authority given to the companies to purchase preferred shares. By eliminating the words "and the 1973 fiscal year" the amendment really negates the bill, interrupts and destroys it. It goes to the heart of the bill and negatives it. In other words, the hon. member has the more legitimate alternative, if he wishes to make an amendment, to negative the bill by voting against the bill in its entirety.
My third submission is that the amendment indirectly affects the balance of ways and means, caused by depriving the national company of accepting preferred stock during the 1973 year which would force the national company to seek financing in the commercial sector, with the result that CN would have to pay interest at commercial rates. The results for the year would be worse than if they were able to get more favourable financing through preferred shares from investment by the government of Canada. That being so, a subsequent bill would have to reflect this in the further financing necessary for the CNR upon the authority of the government, thereby imbalanc-ing ways and means.


Mr. Deputy Speaker:: I thank the hon. member for Mississauga (Mr. Blenkarn) and the Minister of Finance (Mr. Turner) for discussing this point of order. It is indeed helpful to the Chair. The point that must now be considered by the Chair is whether the point of order originally raised by the Chair is correct. The point of order is whether the bill should be amended in clause 13 by deleting line 6 on page 9 and substituting therefor "the 1972 fiscal year".
I think it is clear and accepted by all hon. members that there is a right to take particular provisions in a bill as they relate to proposed expenditures and seek to reduce them. I do not think there can be any question but that hon. members have a right to do that. However, I do not think that is the question that has to be determined by myself at this time.
The bill as it was approved on second reading provided for the provision of money to meet certain expenditures for a period from the 1st day of January, 1973, to the 30th day of June, 1974, and to guarantee certain securities to provide for these moneys. The amendment proposed by the hon. member for Central Nova (Mr. MacKay) and argued on his behalf by the hon. member for Mississauga would, in the opinion of the Chair, negative the principle of the bill as determined by this House on second reading. I would quote to the hon. member for Mississauga para-

April 2, 1974
Canadian National Railways and Air Canada graph 5 of May's eighteenth edition, page 509, wherein it is stated:
An amendment which is equivalent to a negative of the bill, or which would reverse the principle of the bill as agreed to on the second reading, is not admissible.
In my opinion, the substitution of one particular year for another particular period of time is fatal to the admissibility of the amendment, and I therefore have to declare it out of order.


John Napier Turner: that Bill C-5, to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways system and Air Canada for the period from the 1st day of January, 1973, to the 30th day of June, 1974, and to authorize the guarantee by Her Majesty of certain securities to be issued by the Canadian National Railway Company and certain debentures to be issued by Air Canada, as reported (with amendments) from the Standing Committee on Transport and Communications, be concurred in.


Mr. Deputy Speaker:: Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.


Mr. McKinley:: On division.


[Stage Direction]
Motion agreed to.
John Napier Turner: that the bill be read the third time and do pass.


Donald Alex Blenkarn: Mr. Speaker, I hesitate to rise again on the same bill, but it should have been withdrawn by this government and not pressed forward, especially in view of statements made by the Minister of Transport (Mr. Marchand) in this House in the past two weeks in connection with national transportation problems.
This bill pumps millions of dollars of money of the people of Canada into Crown corporations running our transportation system. The Minister of Transport clearly said in this House that he is not satisfied, that he cannot control the transportation companies that he is responsible to supervise, and that there is nothing he can do about transportation. The Minister of Finance (Mr. Turner) says, "O.K. fellow; I don't mind that. Here is some more money for the railway company and for the airline. They need the money. Let them have it. We have no control over these companies." The Minister of Transport said he cannot control the companies, yet the Minister of Finance is prepared to finance them. The minister responsible does not know what is going on and has no transportation policy. That is an amazing situation, yet it is the one we are faced with today with this government.
There is no question that the companies probably need some financial support. In the debate today, yesterday and previously we mentioned our concern about the management of the companies. Clearly, the Minister of Transport must have this concern. We are surprised he has not been here for this debate. He is the person who admitted this government has some very serious concerns about the management of transportation in this nation.

The Minister of Finance says the companies need the money, they are going to get it, here it comes and they can have it. Air Canada can go into new ventures without explaining them to the people of Canada and to this House. The railways can spend money on hotels and towers without the Minister of Transport being concerned about whether the money is being properly or sensibly invested. The Minister of Finance does not understand what is going on in transport. He says he only looks at things in the global view.
The Minister of Transport says he doesn't even look at things, he doesn't understand what is going on, he doesn't even have a transportation policy. Yet here we have a bill before the House, now at third reading, supported by the government and supported, of course, by the New Democratic Party. They don't care about the money of the people of Canada either. They say, "Let's pass this bill and let's give this corporation more money, because the government doesn't have a policy for transportation so we might as well support their policy to pour out money."
I was indeed suprised that the Minister of Finance in the matter of the amendment that he argued was out of order, and which Your Honour ruled was out of order on the basis of previous citations, should suggest that this bill and the royal recommendation is correct and that the government is entitled to subscribe for shares in the Canadian National Railways on the basis of the gross revenue of the company for the year ending December 31, 1973; to buy the 4 per cent preferred shares of the company, even on the basis that they haven't got a statement for the year ending December 31, 1973, at the present time.
So we have an open-ended bill allowing the advance of funds, the purchase of capital stock in the Canadian National Railways, a bill that organizes the purchase of that capital stock, how much we don't know, when we don't know, on the basis of what financial statement and what gross revenue we don't know. And the Minister of Finance does not know. Yet the Minister of Finance was prepared to argue that procedurally this was in order, that he had the right to spend the money, that the Crown authorizes him to spend money. He doesn't know how much money, he doesn't know why so much money, he hasn't any real idea of what is going on in transportation, but let's spend some money-because that is the attitude of this administration.
Let us consider for a moment these 4 per cent noncumulative preferred shares. They were first set up in the provisions for the refinancing of the Canadian National Railways in the bill of 1952. In that statute there was provision made for the conversion of the debt of Canadian National into preferred shares. The preferred shares bear a dividend if, as and when there are dividends to be declared. Naturally, they never declare a dividend, so the preferred shares never offer any return on investment.
On the basis of the 1972 statement the government is proposing to invest $43 million in preferred shares in the Canadian National Railways. On the basis of the 1973 statement-and we will never know when the 1973 statement will be available-the government may invest another $43 million or another $45 million or perhaps

another $50 million. Who knows? But they are prepared to invest in more shares of the Canadian National Railways.
The Minister of Finance does not even know what he is going to invest further in these 4 per cent, never pay, no dividend, no profit shares of the Canadian National system. And that is what the bill says and this is what we have before us for consideration. It is an impossible situation when you have a Crown corporation and a government which is prepared to shovel out money without coming to grips with the transportation problems faced by the nation, without coming to grips with the commuter problem spoken about this afternoon by the hon. member for Scarborough East (Mr. Stackhouse), and without coming to grips with the grain transportation difficulties spoken about so eloquently by hon. members from the west, without coming to grips with the situation concerning rail line abandonment, without coming to grips with the situation in which trains do not move along some lines even though those lines are not among those which have been abandoned.
A member of parliament tells the House that the last train that went through on his line was in February and the next train is scheduled to go through maybe in June, July, or maybe never. This is the kind of government that says it is running this country, and this is the kind of transportation policy we have. Yet here we have the Minister of Finance in this House prepared to say that he is entitled to subscribe to more capital stock in the Canadian National system based on 3 per cent of the gross earnings of that system in the year ending December 31, 1973, when he hasn't even got a financial statement for the year ending December 31, 1973. If he does have such a statement, he hasn't tabled it before this House.
Here we have an open-ended contract to pour money into a system without looking at that system and without coming to grips with the reality of the financial facts in the country. We are neither getting the service required by the people of Canada, nor are we getting the kind of performance and policy in transportation that the people of Canada demand. Even the Minister of Transport is unhappy. Yet the Minister of Finance is prepared to shovel out the money with the support of the New Democratic Party, because they really don't care about economics-


Stanley Howard Knowles: Are you going to vote against it?


Donald Alex Blenkarn: -and they really don't care about transportation. All they want to do is make sure that Crown corporations have more and more money, and they don't want to worry about performance. That may be their attitude toward their constituents. It certainly is not the attitude that my constituents would buy. The taxpayers of this country should certainly not be subjected to being continually asked to supply money without any real accountability of the management of Canadian National and Air Canada. These corporations have not necessarily served us well as has been admitted even by the Minister of Transport. He admits he has problems with these corporations. Yet we continue to have bills presented before this House to refinance Air Canada and the CNR.
What are we doing? We are taking public funds which could be put into housing, which could be put into com-
Canadian National Railways and Air Canada muter services, which are needed in many other areas, and we are pouring them in without any control of how these companies operate. These companies have clearly demonstrated that they are prepared to go into new fancy deals, buy up a piece of de Havilland, buy Canadian, get into the Wardair deal, run a company called Econair Holidays Limited. Yes, and build a tower in Toronto, and ask for money to put into a losing hotel chain. This is the kind of proposal we hear from the government and this is the kind of proposal the bill means. The bill means that the government has abandoned its responsibility to closely scrutinize the activities of the Crown corporations for which it is responsible, and the passage of this bill is an indictment of both the government and its helpers who are left.


Stanley Howard Knowles: Are you going to vote against it?


Donald Alex Blenkarn: The bill is a travesty. It is improper at the present time. The government should hold it back until it has made a thorough investigation of the national railway system and Air Canada. It should review the direction management is taking and then refinance this Crown corporation properly. Until now it has not been operated properly. The Minister of Finance should listen to his colleague, the Minister of Transport, in connection with transport policy, and say, "When you have got it organized, come and tell me and we will refinance it properly and make sure it is all right, and we shall all be with you."
There are a number of things which must be done in this country, but the bill before us does not require the CN or Air Canada to conduct their affairs properly and in the best interests of the public. It just shovels money out, money which they have proven in the past they are incapable of handling in a sensible fashion.


Mr. Walter Baker (Grenville-Carleton):: Mr. Speaker, I rise at this late hour and I look across to my neighbour, the Minister of Finance (Mr. Turner), with some sympathy, recalling that today, yesterday and earlier in this parliament he has sat here patiently listening to debate on a matter which really is only peripheral to him, a matter which in terms of responsibility should have been attended to by the Minister of Transport (Mr. Marchand).
The fact that the minister has had to sit here is an indication-indeed, perhaps an indictment but certainly an indication-of the decrepitude to which transportation matters in this country have fallen. It is perhaps an indication, as well, of the truth of the statement made by the Minister of Transport that his department is indeed in a mess; that he found it in a mess when he took over the department. Certainly all of us know he has done nothing to clean up that mess since he has been there.
So my first words are words of sympathy to my neighbour, the Minister of Finance, for having to shoulder this responsibility. We all know he has tremendous responsibilities in the Department of Finance. Although we have divided opinions as to how he is carrying out his responsibilities, I think it is unfair to load on to his young shoulders the ineptitude of his colleagues.

April 2, 1974
Canadian National Railways and Air Canada
The question with which we really have to deal, and what is really the essence of all the speeches that we have heard on this bill, is that there are not simply problems with transportation in Canada-there are new challenges to meet. The long and the short of it is that as an operating railroad the CNR has not met those challenges. In a day when our cities are becoming overfilled with people, when there is a requirement to build new towns in my part of Ontario, indeed in all metropolitan areas of Canada, when we are putting more and more people into smaller and smaller areas, we are not developing in this country a transportation capability that will make a viable new towns concept, as proposed by the Minister of State for Urban Affairs (Mr. Basford), really workable.
If we choose to slow the increase in the rate of population in our urban areas, there will be no foundation for this very worth-while program. The key to the success of that program will not merely be the provision of land, sewers and water, but the assurance to the people who will make a commitment to new areas which we are trying to establish, and which we hope will be established in this country some day, that they will have a transportation system that is speedy, efficient and inexpensive to operate.
There is no provision in this bill to give anybody any encouragement that the railroad companies, the CNR in particular, are being armed to meet this new challenge. We need only consider what has happened to the rail service in this country over the past few years, regardless of the admitted inability of the Minister of Transport. The railroads in this country have operated in such a way that they are attempting perhaps to do indirectly what they might better have done directly, namely, to drive passengers away from the railroads and to other modes of transportation.
It seems to me that while we must admit that the railroads, and perhaps Air Canada as well, need funding, there is no direction given either in the bill or in any government policy to assure the people of Canada that the transportation system of this country will be able to meet the challenges-a favoured word of hon. members opposite-of the seventies. Each of these challenges is being short-changed in terms of government policy.
I am about to sit down, Mr. Speaker, but I just wanted to express my personal sympathy, as well as the sympathy of all members on this side of the House, regarding the burdens that the Minister of Finance must carry. I hope he will take a very active part in the review of the transportation policy of this country, a policy that a senior minister of the government has admitted is chaotic, to be charitable, and is in a mess, to be honest.


Mr. Godin:: Mr. Speaker, may I call it ten o'clock?


John Napier Turner: Mr. Speaker, I am rising on a point of order. I am under the impression that another hon. member might speak. We could end this debate tonight, with the consent of the House. It would not be long.


Roland Godin: Mr. Speaker, I will have a few words to say tomorrow. I know that one of my colleagues also wants to

speak on certain problems peculiar to his constituency and regarding companies under government jurisdiction.


The Acting Speaker (Mr. Boulanger):: As I understand it, the House agrees that we now call it ten o'clock.
Agreed?


Some hon. Members:: Agreed.



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
A motion to adjourn the House under Standing Order 40 deemed to have been moved.

Mr. John A. Fraser (Vancouver South):: Mr. Speaker, on April 1 I put some questions to the Minister of Indian Affairs and Northern Development (Mr. Chretien) in connection with whether or not the authority that he had given for exploration on Bathurst Island had been subject to the environmental impact policy which the Minister of the Environment (Mr. Davis) had recently announced to the House. The minister replied in words that I can only say avoided the question. I quote his reply for Hansard for April 1, as reported at page 1024:
Mr. Speaker, there is in fact considerable co-operation between my department and that of the environment. We consult each other every time we are up against a problem, but decisions were taken, as they should, by my department and the Department of the Environment expressed no opposition.
In answer to a further question the minister replied:
Mr. Speaker, as Minister of Indian Affairs and Northern Development, I make the decisions. Naturally, when problems come up, we have consultations with the Department of the Environment, and in this case that department had no major objection to the work under progress.
Those answers, of course, beg the question that was put to the minister, but I think it is of considerable importance that this House learn tonight whether or not the federal environmental assessment policy, which was recently put before the House and has been criticized not only by my party but by other parties, actually works. I was extremely critical at the time the Minister of the Environment put forward his environmental impact statement. I said, among other things, that the environmental impact policy that the government was putting forward was, first of all, secretive and, secondly, was not mandatory and that as a consequence the public could not be assured that in all cases that required it a mandatory environmental impact assessment would be made.
It is of interest to note that in the Canadian Arctic Resources Committee publication "Northern Perspectives" of December-January, 1974, Professor A. R. Lucas of the

law school of the University of British Columbia had this to say:
There are two very basic difficulties with the Davis proposal. First, it is apparent that the proposed assessment procedure will be implemented through administrative changes only. There will be no new legislation. Review of assessments will be done wholly within the Department of the Environment, according to departmental guidelines. Thus, the entire process will be in-house and subject to political pressure and bureaucratic self-interest and inertia. This approach was taken despite a recommendation in a report by a Department of the Environment task force composed of senior officials and based on some five months of research, that an independent environmental review board be established by statute outside the department to require and review environmental impact assessments. Mr. Davis himself has admitted that there will be a "natural resistance in the bureaucracy to another set of checks and balances".
My concern is that it is all very well to talk about natural resistance within the bureaucracy, but I think unless there is a very satisfactory explanation given to the House tonight a great deal of the resistance is not within the bureaucracy at all but, rather, is within the cabinet. In his statement the Minister of the Environment said, and I quote from Hansard of March 14, 1974:
Federal departments, Crown agencies and private companies with government contracts, grants and loans will have to prepare environmental impact statements. These statements will be screened by a panel of experts in my department.
In this way you do not get before the public the actual environmental impact statements at all; you get the government's own screening of the impact statements and, as a consequence, you get the government's own interpretation of what it wants you to hear; and I said this on March 14. The minister went on to say:
Recommendations for action, that is, for approval, for modification or for denial, will be made to the Minister of the Environment. Final dispositions will, of course, have to be worked out in consultation with other ministers of the Crown.
What does this really mean, and what does it mean in view of the answers given by the Minister of Indian Affairs and Northern Development (Mr. Chretien) yesterday? Apparently it means, if you take the answers of the Minister of Indian Affairs and Northern Development at face value, that within the department, in spite of this policy that has been set down, every department is going to assert a certain sovereignty in opposition to the very policy which the Minister of the Environment presented to the House the other day.
It is interesting to note that in view of whatever advice the Minister of Indian Affairs and Northern Development had to proceed with the drilling over the opposition of the Eskimo people who said this would drive the game upon which they depended from their traditional hunting grounds, Professor Milton Freeman of the department of sociology and anthropology of McMaster University said on March 25:
-I can only conclude that Mr. Chretien has been very badly advised to allow this work to proceed in ignorance of much of the pertinent information available, and with so much of a critical nature still unknown.
It is incumbent upon the government tonight to answer certain questions. I think it is fair to ask the Minister of Indian Affairs and Northern Development, in view of the answer to the question whether this environmental policy
Adjournment Debate
has any influence in the north-and certainly it was not followed in this instance-to tell us just exactly what is going on.


Mr. Len Marchand (Parliamentary Secretary to Minister of Indian Affairs and Northern Development):: Mr. Speaker, in the three minutes at my disposal tonight I am sure I cannot deal with all the points raised by the hon. member, but I will consider his representations and send him a report a little later in respect of those points with which I cannot deal.
I want to assure the hon. member that the Department of Indian affairs and other people concerned with the development of the north are paying a great deal of attention to the recommendations of the Department of the Environment and, indeed, a great deal of attention to the environment whether in the case of ecological disturbance or environmental disturbance.
The minister has stopped seismic operations in two cases in point-in the open waters off Southampton Island where seismic work was stopped because of fears of disturbing walrus herds in that area, and on the Bathurst peninsula where no seismic work has taken place for three years because of the fear of disturbing the cariboo herds in that area. In the particular case about which the member is talking, the matter of the Bathurst Island seismic operations came before the advisory committee on January 9 and January 30 and received approval to proceed.
This followed the normal procedure adopted for the processing of all land use applications. The Northwest Territories land use advisory committee is made up of officials of the Department of Indian Affairs and Northern Development together with representatives from several other federal agencies, including the Department of the Environment-wildlife services, fisheries and marine service, and environmental protection service. The NWT government is also represented on the committee by the territorial game management division. There was also communication between the minister and Mr. Tagat Curley, president of the Inuit Tapirisat, on this proposal. The community of Resolute Bay was advised of the application and its subsequent approval.
On the recommendation of the various experts consulted, and from previous experience with similar seismic operations in other areas of the Arctic, it was the consensus that the operation could take place with minimal disturbance to the environment.


ENERGY-OIL PIPELINE EXTENSION TO MONTREAL-REASON FOR REJECTION OF EXTENSION OF EXISTING SARNIA-TORONTO LINE
Reginald Cyril Symes: Mr. Speaker, I rise tonight to pursue a question which I raised last Friday and subsequently to the Minister of Energy, Mines and Resources (Mr. Macdonald) concerning the construction of the Sarnia-Montreal pipeline. I asked the minister why, in light of the fact that there already exists a pipeline from Sarnia to Toronto, the government did not plan to merely extend the Toronto pipeline to Montreal, thereby saving construction time, saving money and avoiding the disruption of farmland in southwestern Ontario.
1106

April 2, 1974
Adjournment Debate
In view of the replies I have received from the Minister of Energy, Mines and Resources I can only conclude that he has misled Canadians and members of the House as to the original reasons for which this pipeline was necessary and that, more than that, he is guilty of perpetrating a hoax on the Canadian public about the building of an all-Canadian pipeline.
The minister's arguments for the Sarnia-Montreal pipeline are many and varied and seem to be changing daily. At first when this proposal was advanced, he said the reason for it was time, that we had to get oil to Montreal as quickly as possible. Members of parliament accepted that reason. Now there is clear evidence that the Sarnia-Toronto pipeline has the capacity to fulfil the initial requirements of 250,000 barrels a day of the Montreal market. When I pointed this out to the minister, he then switched his argument by raising a number of red herrings. First of all, he said the Toronto extension was not possible because to get that capacity to the Montreal market would require cutting off three U.S. refineries. The minister knows that these refineries are on a monthly contract, that they can find oil elsewhere in the U.S., and there would be no immediate cut off because it could be phased-in during the construction of the Toronto extension.
He then changed his argument to one of capacity, saying that although the Toronto extension would provide initial requirements of the Montreal market, it could not fulfil future requirements of up to 500,000 barrels a day. I propose to the minister that the future requirements of the Montreal market might easily be met by, first of all, developing the all-Canadian pipeline in phases: phase one from Sault Ste. Marie to Montreal, hooking up with the existing pipeline in Michigan; phase two from Winnipeg to Sault Ste. Marie, thereby completing an all-Canadian route.
Upon hearing this argument, the minister brought out further obstructionist arguments saying there would be problems in getting right-of-way through Michigan up to Sault Ste. Marie, some 80 miles. There already exists a natural gas pipeline through Michigan in the same area. The minister then said, "Well, there are all the objections from the U.S. environmentalists which would delay such an application". This is still pure conjecture and I fail to see how any time would be saved by the proposed Sarnia-Montreal pipeline when there are some 4,000 farmers ready to object to the disputed overland rights-of-way in that area.
Then today he brought out another argument, saying that we cannot have the Toronto extension because it will not be reversible. Of course it will not be reversible. What is the point of having a reversible pipeline from Sarnia to Montreal? What are we going to reverse through it? To date there are no great oil finds off the east coast. The existing crude oil coming into the eastern market is from Venezuela, not the Middle East. It has characteristics different from western crude and the refineries in southern Ontario are not capable of handling this offshore crude.

My conclusion has to be that the Sarnia-Montreal pipeline is not just an interim solution and that the government's announcement of an all-Canadian route through northern Ontario is a hoax. Both these arguments put forward by the minister seem to indicate to me that there will never be an all-Canadian route, because of the very nature of the Sarnia-Montreal pipeline and the minister's expectation of its upgrading and expansion. Because we will not have an all-Canadian route, this will only perpetuate the government's discrimination against northern Ontario and its hoped-for development in the form of refineries and subsidiary industries. Further, Mr. Speaker, we will not have security of supply if we do not get the northern route.
The minister is continuing to play into the hands of the oil companies to the detriment of a truly Canadian oil delivery system for the benefit of all Canadians. I call on him to reassess the Sarnia-Montreal pipeline, and I challenge him to give a definite commitment on the date when an all-Canadian pipeline will be built.


Donald Stovel Macdonald: Mr. Speaker, the only hoax involved here is that perpetrated by the hon. member who is trying to fabricate an issue. Once more I will repeat to him the cumulative reasons for the decision to build the Montreal-Sarnia line. As I say, they are cumulative, but I have no expectation that they will make any impression on him. First, the additional capacity in the line from Sarnia to Toronto would be 250,000 barrels a day if indeed the export to Buffalo were cut off. It may be that in time the export to Buffalo would be cut off, but I do not share his enthusiasm for the bad relations with the United States that would be engendered by cutting off these 135,000 barrels a day. New demand in Toronto for refineries now under construction in the Sarnia-Toronto area totals 130,000 barrels a day. That means, instead of having the capacity mentioned by the hon. member there is a balance of only 120,000 barrels a day. So to accept the hon. gentleman's argument one would have to lay a new pipe. So much for his argument about the suggested capacity, Mr. Speaker.
In fact, what we have done is to propose a 500,000 barrels per day capacity, one that will be financed initially by a Montreal throughput of 250,000 barrels a day, with the strategic opportunity of increasing that to 500,000 barrels. The hon. gentleman referred to Sault Ste. Marie construction. It is clearly on the records of this House that this would take six months longer. What is more, there is a further incalculable period-neither I nor any other person can calculate it-for administrative delay in the United States. We are concerned about the Montreal market and getting oil to it at the earliest possible date. This is why we picked this route, Mr. Speaker.
Is it reversible? Yes; and that is to take care of the possibility of Atlantic offshore oil being brought into Canadian refineries. It is only an option. There is no certainty that we will develop that capacity, but it certainly would not be available to us with the Sault Ste. Marie route. Further, that would not be a route for an allCanadian pipeline. It would undoubtedly be a route which would parallel the existing TransCanada pipeline which
April 2, 1974

follows up through the Canadian clay belt. In that sense, the Sault Ste. Marie route is really not an option because it would be dependent upon passage through the United States, passage which we cannot guarantee.
These cumulative reasons I have given before. I have repeated them for the hon. gentleman this evening, but I have no expectation that we will not hear further from the hon. gentleman as he tries to think up new arguments for his proposal.


AGRICULTURE-DAIRYING-REQUEST FOR STATEMENT ON LONG-TERM POLICY
William Herbert Jarvis: Mr. Speaker, the purpose of my question earlier today was to determine if, in fact, the government does have a long-term dairy policy. I suppose this could be extended by asking whether the government intends at some future date to formulate such a policy. For our purposes this evening, however, I will accept at face value the assurances of the Minister of Agriculture (Mr. Whelan) that he does intend to have a long-term policy. One must be concerned, nevertheless, with the difference between the minister's intentions and cabinet's acceptance of those intentions, because we have had ample evidence in this parliament that, while the minister is rushing around giving great speeches, usually well received by the agricultural community, his cabinet colleagues are the last to listen to him, let alone concur in his recommendations.
Having said this, Mr. Speaker, let us trace the recent unhappy history of a long-term dairy policy for Canada. For years agricultural groups, associations and individual producers have suggested, recommended and demanded a five-year program. Today, in reply to my question, the minister indicated that a five-year plan was too short. Possibly he is suggesting a ten-year plan is twice as good as a five-year one. If such is the case, one can only assume that the minister claims an expertise and knowledge of the industry that is superior to the Federation of Agriculture, the dairy farmers of Canada, the Ontario Milk Marketing Board, the Food Prices Review Board, the federal task force on agriculture and heaven only knows who else.
But let us even ignore this. The minister, on March 22, 1974, in this House had this to say as reported at page 783 of Hansard:
I have told the farmers and have said publicly that we are working on a long-term dairy policy. Announcements will be made by April 1 according to the legislation.
Later he said:
-we have been working on it for three months as hard as we can. We have worked very closely with the dairy industry. I do not think another Minister of Agriculture has worked as closely as I have with the dairy industry.
Again, for our purposes tonight I will accept the minister's assurance at face value. I and many other members of the House waited, along with all Canadian dairy producers, with great expectations for the minister's statement of a long-term dairy policy when he rose to make his announcement last Friday. It is to be regretted, Mr. Speaker, that the minister did not make his statement on Monday, April 1, because then it could be excused as a poor April fool's joke in so far as a long-term dairy policy
Adjournment Debate
is concerned. Last Friday the minister made his long awaited announcement. It took 36 lines in the official report, of which but 14 were about long-term policy. And what is this policy? I quote from the minister's words of last Friday, at page 978:
The Canadian Dairy Commission has been authorized to enter immediately into discussions with producers and other groups-
The only action the Department of Agriculture will take is to authorize discussions. This is from a minister who claimed just over a week ago, "We have been working on it for three months as hard as we can". This is from a minister who says, "I do not think another minister of agriculture has worked as closely as I have with the dairy industry." The sole result of these so-called three months of work and the so-called close association with the industry is to authorize discussions. I ask the minister, Mr. Speaker, the following: What is his long-term policy to solve low financial returns? What is his long-term policy to solve lower production? What is his long-term policy regarding the 700,000-pound limit on subsidy eligibility quotas? What is his long-term policy regarding fluid milk producers who from time to time provide industrial milk?
Then I ask: What is his long-term policy to save the farm separated cream industry, except to import more and more creamery butter, an increase in imports of 362 per cent in 1973 over 1972-an increase of 362 per cent in one year alone. What is the minister's long-term policy on skilled farm labour for the producer? What is his long-term policy regarding the merger of market sharing and subsidy eligibility quotas? What is his long-term policy about a market price of products? Are subsidies permanent, or will the consumer be asked to pay the cost plus a reasonable return to the dairy producer? What is the minister's long-term policy regarding government service programs? What is his long-term policy to maintain a proper milk feed ratio?
There are other questions to be asked, Mr. Speaker, but I pose these to prompt some response, any response, from the minister. I appreciate, and sympathize with, the minister's difficulties in convincing cabinet that there even is a Canadian dairy industry, let alone convincing them that a long-term policy is essential. I hasten to assure the minister that we in this party will co-operate and assist in developing this policy, as we have in other agricultural problems which have faced Canadian farmers. I urge the minister not to accept a watered-down, do-nothing policy from his cabinet colleagues; and I am very concerned, Mr. Speaker, as a result of the minister's answer to my question today, that this is what is happening in cabinet.
Earlier today I asked the minister to make a definitive statement of his long-term policies for the dairy industry. In his reply he emphasized the need for consultation with the producers. I agree with this need. I regret that such consultation has not been going on on a regular basis as requested repeatedly over the years by the Federation of Agriculture, the dairy farmers of Canada and others. The minister then indicated that the government was ready to make a proposal to the industry and had instructed the Canadian Dairy Commission accordingly. What I fail to understand, Mr. Speaker, is what the commission is supposed to do now. Are they to consult with dairy producers, are they to negotiate with dairy producers, or are they to dictate terms to dairy producers? The minister then went
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Adjournment Debate
on to say that the Canadian Dairy Commission has instructions to proceed along certain unnamed guidelines. Are these a secret? If the minister wants constructive suggestions from producers, let him tell this House the guidelines so that producers will have removed from their livelihoods this shroud of secrecy.
I have here in my hand ten speeches by the Minister of Agriculture given between February 13 and March 22 of this year. All of them discuss the need for a dairy policy. Through you, sir, I say to the minister that the time has come for him to talk for the dairy producer, not to him. On March 22, as recorded at page 783 of Hansard, the minister said:
It is obvious that we must make our dairy industry capable of supplying every product we need.
I agree. But I submit, sir, that this is impossible unless the government gives long-term policy commitments. On behalf of every dairy producer of Canada, I say to this government and to the minister: the time to give such commitments is now.


Léopold Corriveau: Mr. Speaker, I was rather surprised that the hon. member of the opposition should choose to discuss this topic on motion for adjournment. In his remarks, he certainly expressed no doubt that dairy producers wish to be consulted on a matter of such importance to their livelihood as a long term dairy policy.
Not so long ago, the Dairy Farmers of Canada presented a brief to the Minister of Agriculture (Mr. Whelan) which dealt in detail with a long term dairy policy. The minister gave very special attention to that brief and is now endeavouring to formulate a long term dairy policy in the best interest of dairy farmers and consequently in the best interest of all Canadians.
Considerable work has already been done on the formulation of a policy. Still, it is of vital interest that the minister be made aware of the views of dairy farmers before this policy is finalized.
The Canadian Dairy Commission has been dared to consult the industry, and if the brief of the Dairy Farmers of Canada recently received by the minister is any indication, such consultation would certainly be very welcome.
Motion agreed to and the House adjourned at 10.25 p.m.

Wednesday, April 3, 1974