1974-11-04

ROUTINE PROCEEDINGS


Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity.
Whereas the threat of depletion of the earth's protective layer of ozone arising from the freon gas contained in aerosol cans has become so serious as to be the subject of studies in the scientific journal Nature and to cause others to warn that life on earth will be threatened within 10 to 15 years if present production of freon gas continues, I move:
That this matter be directed to the Standing Committee on Fisheries and Forestry for immediate consideration to determine whether sufficient funds and personnel are available to the atmospheric processes research branch to make effective studies and to return reports in the shortest possible time.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Order. I regret to intervene at this point in connection with a motion pursuant to Standing Order 43, but since a motion requires unanimous consent there is often a temptation to believe that it is not necessary for hon. members to comply rigidly with the rule. I would point out, however, that Standing Order 43, in a similar way to Standing Order 26, requires that the subject matter presented pursuant to the rule should be a matter of urgent and pressing necessity. The motion proposed relates to a problem which has certainly been with us for some time; if the situation becomes more serious it may have terrible implications 10 or 15 years from now. However, in present circumstances I must rule that it is not a proper subject for a motion under Standing Order 43.


CUSTOMS ACT
[Stage Direction]
Hon. Ron Basford (Minister of National Revenue), moved the first reading of Bill S-4 (from the Senate), to amend the Customs Act.
Motion agreed to and bill read the first time.

Hon. Donald S. Macdonald (Minister of Energy, Mines and Resources) moved: the first reading of Bill S-13 (from the Senate), respecting the boundary between the Provinces of Alberta and British Columbia.
Motion agreed to and bill read the first time.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Holmes: 1.	How many copies of QUAD Review Number 2, June, 1974, were printed for distribution?
2.	How many copies of QUAD Number 2, 1974, were distributed at no cost to the receiver and what professional bodies or institutions received free copies?
3.	What was the total cost to the government for the production and distribution of QUAD Number 2, 1974?


Hon. Marc Lalonde (Minister of National Health and Welfare):: 1. Sixty-two thousand copies of Quad Review 2 were printed.
2.	Two thousand copies were made available through Information Canada. The remainder were distributed to the following groups at no charge: (a) Physicians, 35,000; (b) Pharmacists, 12,000; (c) Hospitals, 1,500; (d) Requested copies from other government departments, foreign governments and professional associations, 200; Professional Bodies and Associations: Proprietary Association of Canada; Pharmaceutical Manufacturers Association of Canada; Alberta Pharmaceutical Association; Le Conseil consultatif de pharmacologie de la province de Quebec; Victorian Order of Nurses; Association des fabricants du Quebec de produits pharmaceutiques; Association des hopitaux du Quebec; Canadian Drug Manufacturers Association; Canadian Medical Association; Canadian Pharmaceutical Association; Canadian Consumers Association; Ontario Pharmacists Association; Ontario College of Pharmacists; Canadian Society of Hospital Pharmacists; L'Or-dre des pharmaciens du Quebec; Canadian Dental Association; (e) Libraries of Medical Schools and Schools of Pharmacy, (f) Copies to be distributed to students of
November 4, 1974

Order Paper Questions
medicine and pharmacy as requested by respective deans; (g) Provincial Departments of Health.
3.	Total cost for printing and distribution of Quad Review 2 was $69,500.


Mr. Cossitt: 1.	Is the government aware of any incident occurring at Canada Customs at the Thousand Island Bridge (Port of Lansdowne, Ontario) during the summer of 1974 involving an official on the staff of the Commissioner of Official Languages and, if so (a) on what date (b) at what time (c) what was its nature?
2.	(a) Is the government aware that the official's name was Mr. G. Robitaille (b) is the government aware of his position on the staff of the Commissioner of Official Languages and, if so, what is that position?
3.	Did Mr. Robitaille speak perfect English when he was first questioned by Canada Customs?
4.	(a) Did Mr. Robitaille subsequently demand that bilingual Canada Customs Officer Mr. Len David be summoned to the Port, a distance of some miles from his home after midnight to speak to him in French (b) was the Officer not only off duty but also on his holidays at the time he returned by this order?
5.	What is the identity of the District Chief of Port Operations or any other persons investigating this incident and (a) on what date did the investigation take place (b) what were the specific findings (c) to whom was the report made (d) what action, if any, was taken or what action will be taken (e) was there any communication to or from the Department of National Revenue and the Commissioner of Official Languages or anyone else on the Commissioner's staff on this matter and, if so (i) on what date (ii) what was the specific nature of such communication?
6.	Is the Department of National Revenue taking steps to prohibit such incidents at places under its jurisdiction by the Commissioner of Official Languages or by persons on the Commissioner's staff and (a) if so, what are these steps (b) if not, for what reason?


Hon. Ron Basford (Minister of National Revenue):: In
so far as the Department of National Revenue is concerned: 1. Yes. (a) July 3, 1974; (b) At approximately 1:00 a.m.; (c) Language of service.
2.	(a) Yes; (b) Yes; Secretary General.
3.	Yes.
4.	(a) No. He demanded to be spoken to in French but he did not ask for a specific officer; (b) No, he was on call.
5.	The investigation was carried out by the Regional Collector of Customs and Excise, Ottawa Region; (a) July 23, 1974; (b) It was determined that Mr. Robitaille asked for bilingual services which were not available on that shift, (c) Official Languages Program Section, Customs Operations Branch; (d) No action contemplated; (e) Yes. (i) Various dates subsequent to July 16, 1974; (ii) Request by Commissioner of Official Languages for comments and Department response.
6.	No; (a) N/A; (b) The Department of National Revenue has no jurisdiction over the office of the Commissioner of Official Languages.


Mr. Fortin: Since July 1, 1968 (a) for which highway improvement projects in the constituencies of Lotbiniere, Arthabasaa and Nicolet has the Gov-

ernment of the Province of Quebec requested financial aid from the government (b) has the government contributed?


Hon. John N. Turner (Minister of Finance):: (a) The
Government of the Province of Quebec requested financial assistance from the Federal Government under the Federal-Provincial Employment Loans Program as follows: 1. Comte d'Arthabaska, Route TransQuebecoise, St-Albert to Trans Canada including bridges, 12 miles, $1.4 million; and 2. Comte de Lotbiniere, Route No. 3, St-Antoine-de-Tilly, 3.5 miles, $627,000. (b) Federal loans totalling $2,027,000 were advanced to Quebec for these projects. As per the terms of the Federal-Provincial Employment Loans Program, loan forgiveness totalling $92,657.81 has been approved with respect to on-site labour costs incurred on the projects.


Mr. Marshall: What are the plans of the Department of Public Works for disposal or use of the former post office building in Stephenville, Newfoundland?


Hon. C. M. Drury (Minister of State for Science and Technology and Minister of Public Works):: The tentative date for the issuance of the final certificate of completion is October 31, 1974. At that time, all other government departments will be canvassed to determine whether further federal accommodation needs exist which can be satisfied by the post office building. Should no such needs exist, then the property will be retained under federal control but the possibility of leasing it to non-federal interests will be considered.


Mr. Marshall: 1.	How many applications have been approved in Newfoundland under the Assisted Home Ownership Program?
2.	What amount of money has been allocated under the Assisted Home Ownership Program to Newfoundland (a) the province in total (b) to each of the seven federal electoral districts in Newfoundland?


Hon. Barney Danson (Minister of State for Urban Affairs):: 1. Applications for 148 housing units, totalling $3,307,000 were approved in 1973. Applications for 557 housing units, totalling $13,772,000 were approved during the period January-August 1974.
2. (a) $16.8 million, (b) AHOP funds are allocated on a provincial basis only and are not redistributed on the basis of federal electoral districts. Funds were committed as applications were received and processed, wherever they might have originated in the province.


Mr. Marshall: 1.	Of the 240 loans amounting to $9,601,000 made by the Industrial Development Bank in the Atlantic Provinces during April, May and June, 1974 (a) what was the total number of loans made in each province (b) what was the total amount of money loaned in each province?
2.	In April, May and June, 1973 (a) what was the total number of loans made by the Industrial Development Bank in the Atlantic Provinces (b) what was the total number of loans made in each province (c) what was the total amount of money loaned in each province?
3.	For each month during the period October 1 to December 31, 1973 and January 1 to June 30, 1974, of the total loans made by the Industrial Development Bank in the Atlantic Provinces (a) what was the total number of loans made in each province (b) what was the total amount of money loaned in each province?


John Napier Turner: 1. During April, May and June 1974 the number and amount of loans authorized by the Industrial Development Bank in the Atlantic provinces were as follows: Newfoundland, 71 for $2,362,000; P.E.I., 20 for $444,000; Nova Scotia, 77 for $3,472,000; New Brunswick, 72 for $3,323,000; Total: 240 for $9,601,000.
2.	During April, May and June 1973 the number and amount of loans authorized by the Industrial Development Bank in the Atlantic provinces were as follows: Newfoundland, 55 for $2,028,000; P.E.I., 27 for $795,000; Nova Scotia, 90 for $2,412,000; New Brunswick, 74 for $3,715,000; Total: 246 for $8,950,000.
3.	Information concerning the lending activity of IDB is published on a quarterly rather than on a monthly basis. The figures requested for the period October 1, 1973 to June 30, 1974 are as follows: Newfoundland, 182 for $5,852,000; P.E.I., 60 for $2,026,000; Nova Scotia, 182 for $6,217,000; New Brunswick, 210 for $10,647,000; Total: 634 for $24,742,000.


Mr. Marshall: Under the Department of National Health and Welfare, and specifically the Disabled Persons Act what are the names of the two representatives of the government and the two representatives of each province who serve on the Advisory Board and (a) on what date were the appointments made (b) what remuneration do they receive?


Marc Lalonde: The Advisory Board established by the Disabled Persons Act has not met since 1959 and with the phasing out of the disabled persons program, it is not anticipated that there will be future meetings of the board. It consisted of two representatives of the government of Canada, appointed by the Governor in Council, and two representatives of each of the provinces with which agreements had been made, appointed by the Governor in Council on the recommendation of each province. The federal representatives on the Advisory Board were the Minister of National Health and Welfare and the deputy minister of welfare. The minister in charge of welfare for each province, except Ontario, was one of the two provincial representatives. The other representative was either the deputy minister or the chief administrative officer in charge of
Order Paper Questions
assistance and allowances. In the case of Ontario the representatives were the deputy minister of public welfare and either the director of welfare allowances or another senior administrative officer. Although not a member of the board, the Ontario minister of public welfare attended the meetings, (a) The last appointments to the Advisory Board, pursuant to subsection (3) of Section 11 of the Disabled Persons Act were made by P.C. 1959-1311 dated October 8, 1959. (b) Members were reimbursed for travelling expenses incurred in attending meetings but did not receive other remuneration.


Mr. Marshall: Is any consideration being given to amending the Pension Act (a) to provide for pensions for widows of deceased pensioners who were in receipt of pensions of less than 48 percent and, if not, for what reason (b) to provide exemptions for veterans in receipt of partial disability and also receiving War Veterans Allowances so that periodic increases in disability pensions will not be deducted from maximum allowance of CWA/WVA allowances and, if not, for what reason?


Hon. Daniel J. MacDonald (Minister of Veterans Affairs):: Any such action would by a matter of government policy and would be announced in the usual way.


Mr. Marshall: Is any consideration being given by the Department of Veterans Affairs to overcome the long delays in adjudicating applications for pension applicants and, if not, what are the reasons for the undue delays?
Hort. Daniel J. MacDonald (Minister of Veterans Affairs): The Canadian Pension Commission is making every effort to adjudicate pension claims in as short a time as possible commensurate with the requirements of the Pension Act.


Mr. Marshall: Is any consideration being given by the Department of Veterans Affairs to review the "intent" of the Benefit of Doubt Clause to indeed giving the veteran applicant the benefit of doubt and, if not, what is the meaning of the clause in its application by the Pension Commission?


Daniel Joseph MacDonald: The benefit of the doubt is given in every claim before the Canadian Pension Commission and indeed, because of this section of the Pension Act, pensions have been granted to many veterans who would otherwise not have received an award.


Mr. Herbert: How many public servants in the Department of Regional Economic Expansion received T4 slips for 1973 showing gross remuneration in excess of (a) $20,000 (b) $30,000 (c) $40,000?
998

November 4, 1974
Order Paper Questions


Mr. Joseph-Philippe Guay (Parliamentary Secretary to Minister of Regional Economic Expansion):: The answer for the Department of Regional Economic Expansion is as follows: (a) Over $20,000, 212; (b) Over $30,000, 17; (c) Over $40,000; 1.


Mr. Clark (Rocky Mountain): 1.	In the past fiscal year, what was the total payment by CBC to freelance contributors and (a) programming generally (b) news or public affairs commentary?
2.	In the past fiscal year, what was the total amount paid by CBC to freelancers who were not Canadian citizens for contributions to (a) programming generally (b) news or public affairs commentary?
3.	What is (a) the annual budget (b) the freelance budget (c) the total staff (d) the on-the-air staff of CBC offices in each of London, England, Washington, USA and Paris, France?


Hon. James Hugh Faulkner (Secretary of State):: I am
informed by the Canadian Broadcasting Corporation as follows: 1. In the 1973/74 fiscal year $34.3 million was spent on performers' fees authors', composers' and other performing rights, the greater part of which amount was paid to freelance contributors. A breakdown by the categories of programming generally and news or public affairs commentary is not readily available.
2.	The corporation does not have a record of the total amount paid by the CBC to freelancers who were not Canadian citizens for contributions to (a) programming generally, (b) news or public affairs commentary.
3.	(a) It has not been customary to require the CBC to disclose such details of its internal management and administration as the annual budgets for individual locations. (b) Freelance budgets are not assigned to foreign offices of the CBC. (c) Total staff: London, England, 22; Washington, U.S.A., 9; Paris, France, 17; (d) On-the-air staff (news correspondents) London, England, 3; Washington, U.S.A., 3; Paris, France, 2.


Mr. Herbert: 1.	Has the study of the Canadian Pension Commission to determine where inequalities exist because of sex been completed?
2.	Is legislation contemplated to correct any such inequalities?


Daniel Joseph MacDonald: 1. Yes.
2. Yes, under Bill C-16, the omnibus bill relating to the equality of status of male and female persons.


Mr. Howie: 1.	How many persons are employed on the staff of the Inspector General of Banks?
2.	How many investigations were completed from January 1, 1973 to January 1, 1974 and how many infractions were reported during this period of time?


John Napier Turner: 1. Three.
2. Ten chartered banks and one Quebec savings bank were examined in the period January 1, 1973 to January 1, 1974. No infractions were reported during this period.


Mr. Howie: What, if any, assistance is now offered or planned to assist the provinces in providing ambulance services?


Marc Lalonde: There is limited sharing under the Hospital Insurance and Diagnostic Services Act in respect of ambulance services where an in-patient requires to be taken to another hospital for diagnostic tests and the like and is returned to the original hospital. Where ambulance services are provided to a person meeting a needs test under a provincial social assistance program, the federal government shares in half of the cost of the services under the Canada Assistance Plan.


Mr. Howie: On September 30, 1974, how many veterans from New Brunswick were waiting for hearings in respect to their disability pensions, pension increases or adjustments?


Daniel Joseph MacDonald: Statistics are not maintained with respect to place of origin of pension applications at the first decision level. However, as of September 30, 1974, there were 258 applications from New Brunswick for an entitlement board or a hearing as to quantum of pension, which had not yet been considered. Of this number 128 are in the course of having a Statement of Case prepared in the manner and form required by the Pension Act for an entitlement board, or are being prepared for a hearing as to quantum; 13 are ready to be heard and 117 had been referred to the applicant, usually through his advocate, to determine whether he is satisfied with the Statement of Case or other documentation and to certify that he is ready to proceed.


Mr. Howie: Will consideration be given to a federally funded free school milk programme for grammar school children using whole milk?


Marc Lalonde: The federal government shall rely on the improved family allowances program and a revised income security program to enable families to maintain proper nutrition standards for their children.


Mr. Howie: 
Marc Lalonde: 1. Before definite plans for any future series of this kind can be considered, a detailed and objective assessment of all aspects of the just completed 1974 series is required.
2.	There are presently no negotiations underway for a NHL-WHA team to represent Canada.
3.	Not applicable.


Mr. Cossitt: 1.	For what reason has the government instituted a change in the Assisted Home Ownership Program through Central Mortgage and Housing Corporation to apply to new dwellings only?
2.	Is the government discriminating against those who wish to purchase older homes under this plan and, if so, for what reason?
3.	Is this change in policy a first step towards eliminating entirely this program?
4.	Is the government planning on raising the present maximum amount allowed under this program to meet the rising cost of new dwellings caused by inflation and, if not, for what reason?


Barnett Jerome Danson: I am advised by Central Mortgage and Housing Corporation as follows: 1. Funds under the Assisted Home Ownership Program had been directed towards new housing so that the limited funds left from this most successful program were utilized for the kind of accommodation that was most urgently needed. This had the added benefit of increasing employment in the building industry and adding to the housing stock.
2.	The government has no intention to discriminate. See No. 1.
3.	No. As soon as additional funds are available, the AHOP loans will be continued.
4.	Amounts for the program are under constant review and necessary adjustments are made when required.


Mr. Hnatyshyn: How many applications were received from the constituency of Saskatoon-Biggar for loans under the Farm Improvement Loans Act for each year 1970 to 1973 (a) how many were approved (b) what amount of money was involved (c) what percentage of loans were or are in default?


John Napier Turner: The
requested data is not maintained by electoral district.


Mr. Hnatyshyn: Is the government giving any consideration to the provision of a system of mobile polls for handicapped voters who are unable to use regular polling stations?


Hon. Mitchell Sharp (President of the Privy Council):: Representations of this nature are normally considered by the Standing Committee on Privileges and Elections. The Chief Electoral Officer has received a number of representations along the lines of the question and has informed the correspondents that he would be pleased to lay their
Order Paper Questions
representations before that committee when it next sits, on the instructions of the House, to consider amendments to the Canada Elections Act if they would write him to that effect.


Mr. Brisco: Has the Minister of Regional Economic Expansion had any recent communication from the Government of British Columbia which would indicate that it is the intention of that province to withdraw its participation from the DREE program as it affects Kootenay West and other federal constituencies?


Joseph-Phillippe Guay: The Minister of Regional Economic Expansion has not had any communication from the government of British Columbia suggesting any intention on their part to withdraw participation from DREE programs as it affects Kootenay West and/or other federal ridings in the province.


Mr. Macquarrie: 1.	(a) How many underwater examinations have been conducted on the hull of the Irving Whale (b) on what dates (c) by whom?
2.	What technical personnel other than officers of the Department of Transport have participated in these examinations?
3.	What is the government's present intention in reference to the removal of the Irving Whale?
4.	From what consultants outside the Department has advice been sought?
5.	Is the government aware of the view of the Government of Prince Edward Island concerning the alleviation of the environmental pollution threat posed by the Irving Whale?
6.	On what date and by whom were such views transmitted?


Hon. Jean Marchand (Minister of Transport):: 1. (a)
Five underwater examinations have been conducted on the hull of the Irving Whale; (b) These examinations were conducted in September 1970 when the vessel sank, in September 1971, again in October 1973, May 1974 and the last examination in July 1974; (c) All examinations, except May 1974, were carried out by the Ministry of Transport. The May 1974 examination was made by the Department of the Environment by television and photography only.
2.	The technical personnel, other than officers of the Ministry of Transport, who have examined the Irving Whale are Captain Sven Madsen of Exxon Ltd., New York, New York, as oil pollution and ship's consultant, and James Haase, P. Eng., Montreal, Quebec, Engineering and Salvage Consultant to this Ministry.
3.	The government's present intention is to leave the Irving Whale where it is, as attempts to salvage the vessel may create the very problem we are trying to avoid.
4.	Advice has been sought, among others, from the following: (a) Professor Johannes Molgaard, B.Sc., Ph.D., Associate Professor of Engineering, Memorial University, St. John's, Newfoundland, on Corrosion of Steel; (b) J. E. Benoit and Associates, Montreal, on Insurance details during and after salvage activities; (c) James Haase, P. Eng., AMICE, Consulting Engineer, Salvage, Montreal, Quebec; (d) Captain Sven Madsen, Marine Environmental Specialist, Exxon Ltd., New York, New York; (e) Captain
28305-64'/i

November 4, 1974
Order Paper Questions
W. R. Colbeck, Salvage Expert, Birkenhead, England; (f) Dr. E. C. B. Corlett, Naval Architect and Ship Designer, Basingstoke, Hants, England; (g) Mr. Crothall, Trinity House, London, England, Salvage Methods; (h) John D. Wears, Technical Manager and Principal Surveyor, Salvage Association, London, England; (i) Dr. Molly Spooner, Scientist, Plymouth Laboratory of the Marine Biological Society of the United Kingdom, Plymouth, England; (j) D. Morrice, Chief Salvage Officer in the Directorate of Fleet Maintenance in the Admiralty, London, England; (k) Messrs. P. van den Berg, Captain Moerkerk and C. Kooij, Salvage Experts of Smit-Tak International Salvage Company, Rotterdam, Holland; (1) In addition, a circular letter was sent to all known sources of information on a worldwide basis, seeking advice or possible information on this subject.
5.	The government is aware of the view of the government of Prince Edward Island concerning the environmental pollution threat posed by the Irving Whale,
6.	On July 30, 1974, at a press conference in the federal building in Charlottetown, on Irving Whale matters; the Hon. Minister of Environment and Tourism, quote "expressed satisfaction that the federal government had responded to a resolution passed at the spring session of the provincial Legislature, urging the federal government to take action on the matter of the "Whale" from the Journal Pioneer, Summerside, Prince Edward Island.


Mr. Munro (Esquimalt-Saanich): 1.	Who ordered that new designs for passport covers be prepared?
2.	For what reason was such an exercice undertaken?
3.	(a) Who prepared the designs (b) at what cost?
4.	On what date were the proposed designs put on display in the foyer of the new office building of the Department of External Affairs?


Hon. Allan J. MacEachen (Secretary of State for External Affairs):: 1. The Under-Secretary of State for External Affairs.
2.	(a) Generally, to improve and modernize the Canadian passport which has remained basically the same for over 50 years; (b) In particular, to provide an outside cover whose nationality could be quickly recognized by immigration, airline, or other travel personnel when sorting the variety and volume of passports which have to be handled expeditiously with group tours or with each flight of increasingly large capacity aircraft; (c) Also, to ensure that individual Canadian travellers get the full advantage of their Canadian citizenship without risk of confusion with any other nationality; (d) To retain inside the passport in an attractive manner any features which could be confusing if glanced at quickly on the front cover.
3.	(a) The designs were prepared by: (1) Design Collaborative Montreal Ltd. (2) Gottschalk and Ash Limited, Montreal (3) Charette Designers Inc., Montreal (4) Canadian Bank Note Co., Ottawa; (b) The costs involved are: (1) $4,584 (2) $4,256 (3) $1,176 (4) $5,600.
4.	Tuesday, March 19, 1974.


Mr. McKinnon: 1.	Was Mr. Donovan Joy allotted priority one space on a service aircraft from Comox to Ottawa on April 22, 1974 and, if so (a) by whom was it authorized (b) what was the purpose of Mr. Joy's trip to Ottawa?
2.	On what date did Mr. Joy cease to be on the government payroll in favour of being a Liberal candidate in the 1974 general election?


Mr. Len Marchand (Parliamentary Secretary to the Minister of the Environment):: 1. (a) Yes, requested by the minister and authorized by the Minister of National Defence; (b) To advise the minister upon the completion of reports.
2.	May 23, 1974.


Mr. Herbert: 1.	What action is the government taking or contemplating to increase imports of sugar from the Caribbean Islands?
2.	What is the effect of transportation costs from South Africa on the price of sugar?
3.	Is the government able to estimate what proportion of the sugar market has already been purchased in the next five years and is there any preliminary plan to ration supplies in the event of a shortage?


Mr. Gaston Clermont (Parliamentary Secretary to the Minister of Industry, Trade and Commerce):: The West Indies has experienced declining production of sugar for several years. British Honduras has been able to ship only
13,000	tons of sugar to Canada in 1973 and Jamaica 8,000 tons in 1974. This year the West Indies was not able to fulfil its quota under the Commonwealth Sugar Agreement and prospects for a return to normal production are not favourable. In recent years the West Indies has favoured the United States market over that of the United Kingdom or Canada for whatever sugar has been available.
2.	Because of the system of pricing sugar in Canada the transportation costs of sugar from any country of origin, are not taken directly into account. The price of sugar in Canada is linked directly to the London daily price, which is a CIF price and includes the Caribbean-United Kingdom freight rates which, in turn is adapted to the Carib-bean-Canada rate.
3.	Should current discussions with sugar producers, result in agreement, if is expected that almost half of Canadian requirements will have been committed for the next three years. It is not expected that any shortage of sugar in Canada will occur to the extent that rationing will be required.


Mr. Forrestall: 1.	What was the amount of oil spilled at the NORAD communications relay centre at the Saglek Bay site that occurred on August 2, 1974?
2.	What was (a) the method deployed to clear up the spill (b) time involved (c) total cost of the operation?
3.	What party or parties paid for the oil clean-up and the replacement cost of the oil?
4.	Who has been identified as the party responsible for the spill and what are the specific charges that have been laid against the offender?
November 4, 1974

5.	What precautions have been taken to assure that this situation will not occur again?
6.	Have there been previous occurrences of oil spills in the Saglek Bay area and, if so (a) on what dates did they occur (b) what was the cost involved (c) who was responsible for the spill (d) what charges, if any, were laid?


Len Marchand: 1. The amount of oil spilled was estimated to be 501,784 U.S. gallons.
2.	(a) Clean-up at this comparatively isolated site was undertaken through the co-operative efforts of the Department of National Defence, the Ministry of Transport, the Department of the Environment, the United States Air Force and the International Telephone and Telegraph Corporation (IT&T), responsible under contract for operation and maintenance of the base. The methods applied included: (i) Controlled burning of spilled oil on the ground surface to prevent further run-off into Saglek Bay; (ii) Pumping to storage the oil contained by diking; (iii) Flush out of oil retained in the porous soil, collection of the recovered material in pools and prepared ditches and subsequent transfer to storage; (b) Clean-up operations proceeded for approximately one and a half months. The onset of winter curtailed the work which will be completed following spring break-up; (c) Total cost of the operation is being compiled, with the expectation that it will exceed $300,000.
3.	Initially, costs have been born by the various agencies involved and by IT&T.
4.	An investigation which is currently under way to identify the responsible party, is expected to be completed by mid-November.
5.	All such installations will be examined and specific environmental protection requirements will be prescribed.
6.	No reports have been received in the past respecting oil spill incidents at Saglek.


Mr. Howie: 1.	Was an application made to the Canadian Medical Research Council for a grant to develop a portable device to replace the present artificial endocrine pancreas which is too bulky for anything but hospital use and, if so, have any grants been made or money paid for this purpose?
2.	Have any applications been rejected and, if so, for what reasons?


Marc Lalonde: 1. An application was considered by the Medical Research Council. No grant was made for this purpose.
2. The application was not approved. In the interests of the applicant the Medical Research Council does not release information except to the applicant, about the reasons for a specific application not having been sucessful.


Mr. Jones: 1.	What consideration has been given to extending the provisions of the Veterans' Land Act?
Order Paper Questions
2.	Has the Minister of Veterans Affairs considered an immediate review of the requirements for entitlement to Veterans' Land Act benefits with a view to eliminating the present lot size requirement and substituting therefor lots duly approved by a municipal or provincial jurisdiction and, if so, on what date will the review be completed and a decision made?


Daniel Joseph MacDonald: 1 and 2. As I stated in the House on October 10, 1974, the government is giving careful consideration to the whole matter of the Veterans' Land Act and an announcement on this subject will be made at a very early date.


Mr. Orlikow: 1.	How much money was allocated to the Assisted Home Ownership Program for 1974?
2.	In which cities were funds under AHOP available?
3.	How many housing units, new homes or existing homes, have been approved for purchase under AHOP?


Barnett Jerome Danson: 1. The budget allocation for the Assisted Home Ownership Program in 1974 was originally $300 million. This was subsequently increased and the final allocation totalled $450 million.
2.	AHOP funds were available throughout Canada.
3.	The total number of housing units approved for the period January 1-October 17, 1974 was 17,252, 60 per cent of which was for new housing. Currently, the Central Mortgage and Housing Corporation has approximately 1,250 additional applications in process.


Mr. Forrestall: 1.	For what reason are none of the vessels operated by the government inspected or issued with Arctic Pollution Prevention Certificates?
2.	Does this result from government policy?
3.	What does this absence of certificates mean in terms of the level required of government owned and operated ships in terms of pollution prevention requirements otherwise expected of non-government vessels?
4.	Would all government ships operating in the Arctic be able to pass such standards and, if not, in which cases?


Jean Marchand: 1. The
Arctic Waters Pollution Prevention Act does not apply to any ship owned by Her Majesty.
2.	Yes.
3.	Government ships intended for Arctic service are, in general, constructed to standards higher than those applying to commercial ships for comparable service. Ship Masters are under standing instructions to ensure that pollution prevention requirements are observed.
4.	Yes.

November 4, 1974
Oral Questions


Mr. Fairweather: 1.	Is New Brunswick included in the plans of CBC for an FM radio network?
2.	Will FM reception be available to citizens of the City of Saint John?
3.	For what reason was New Brunswick not included in the recent announcement about the inception of FM broadcasting by CBC in St. John's, Newfoundland and Halifax, N.S.?


James Hugh Faulkner: I am
informed by the Canadian Broadcasting Corporation as follows: 1. Yes.
2.	Yes.
3.	The Canadian Broadcasting Corporation had originally planned to apply to the CRTC during 1975 for a license for an FM radio station to serve the Fredericton-Saint John area. Heavy constraints on the capital budget of the CBC have forced it to delay these plans. It is the intention of the corporation to proceed with these plans as funds become available.
[DOT] (M10)



ORAL QUESTION PERIOD


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, may I address a question to the Prime Minister. Has the Prime Minister now had an opportunity to consider the tabling of the aide-memoire that the government submitted to the European Economic Community early in the year? Has the Prime Minister had an opportunity of consulting the minister concerned, and is he now prepared to table the aide memoire?


Right Hon. P. E. Trudeau (Prime Minister):: Yes, Mr. Speaker. I did discuss the matter with the Secretary of State for External Affairs, and we agree that there would be advantage in permitting the Canadian public to be informed of these matters by tabling. I am having the pieces put together and translated, but I am certain I will be able to table them tomorrow. There will be the aide-memoire, the draft trade agreement, and a statement that was made in September either in Washington or in New York, I cannot recall which, explaining the Canadian position on these two documents. I am quite certain that they will be ready for tabling tomorrow.


CONSUMER AFFAIRS
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I have a question for the Minister of Consumer and Corporate Affairs. In view of the documentation provided on Friday by the Food Prices Review Board showing that certain retail outlets are selling beef at considerably different prices from others, with the clear implication that

some are in fact indulging in what is appropriately called profiteering, would the minister consider making known to the public the names of the chains concerned in particular cities and the prices at which they are selling beef?


Hon. Andre Ouellet (Minister of Consumer and Corporate Affairs):: Mr. Speaker, I understand that the information was obtained by the Board on condition that it remain confidential. The chairman of the Board to whom I directed the same question as asked by the hon. member today has advised me that it is not possible for the Board to disclose confidential information.


SUGGESTED REDUCTION IN PRODUCTION OF BEEF AS MEANS OF INCREASING RETURNS TO PRODUCERS-MINISTER'S POSITION
John Edward Broadbent: Mr. Speaker, may I direct a supplementary question to the minister. In view of the fact that Mr. Burton, a member of that board, at a press conference on this subject on Friday said that the only way of ensuring that the farmer or cow-calf producer will get a greater share or a just price for his product is to decrease the supply of beef in the coming months, and in particular, if I may quote him, that "the only people able to do that are the well established ranchers", is this in the minister's view an appropriate way of dealing with the production of beef both from the consumers' point of view and in the long run interests of the beef producers themselves?


André Ouellet: Mr. Speaker, this report was made public last Friday. We are considering its various aspects and some suggestions from that report may be followed up later this week.


John Edward Broadbent: May I put a final supplementary question, Mr. Speaker. The minister apparently did not hear the question. I was not in this instance referring to what was in the report but to what one of the board members said at the press conference which was called to explain or elaborate upon the report. A Mr. Burton on the Food Prices Review Board is quoted as saying that the only way to deal with the situation we are now confronted with in the beef industry is to decrease the supply of beef. I am asking the minister concerned, from the point of view of the consumers, whether he believes this is the best approach at this time.


André Ouellet: Mr. Speaker, I did understand the question but I do not wish tp comment on a statement made outside the House by a member of that Board, before knowing exactly what was said.
November 4, 1974


REASON FOR DIFFERENCES IN PRICES CHARGED BY SAME RETAILER IN TORONTO AND OTTAWA
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, the minister has stated it is not possible to deal with individual cases, the evidence of which he has not in his possession. I want to draw to his attention and get his observations on two advertisements appearing on the same day, one in the Toronto Star and the other in the Ottawa Citizen, by the same company. From my examination, the interesting thing is that sirloin steak was advertised for sale in Toronto at $1.48 a pound and in Ottawa it was 20 percent higher at $1.79. This is the same ad with the same wording. Porterhouse steak was $1.78 in Toronto and $1.89 in Ottawa and prime rib club steak was $1.48 in Toronto and $1.79 in Ottawa. The minister has said these things are secret, are not known and they cannot be revealed, but an examination will show that, by gosh, the prices are not right, yet these advertisements were by the same company.
In view of these advertisements, and I will let the minister have them although they are ten days old and he should have had them by now, I ask whether he will have this looked into to determine what possible justification there is for this mulcting of the public, as is apparent from these advertisements, while at the same time cattle prices are going down and on the other hand the consumer is being made to pay more and more, providing he lives in Ottawa?


André Ouellet: Mr. Speaker, the answer is yes to the first part of the question. As far as the second part is concerned, I shall inquire about the validity of the hon. member's statement.


AGRICULTURE
Mr. Real Caouette (Temiscamingue):: Mr. Speaker, I have a question for the right hon. Prime Minister, in the absence of the Minister of Agriculture.
I am convinced the Prime Minister is not insensible to the farming conditions in Quebec as well as throughout the country. Sad demonstrations have taken place over the week end in the province of Quebec and similar ones are likely to occur in other provinces. I think the farming population of the country expects the Prime Minister to take a position, to make statements in order to meet the farmers' normal and fair demands.
Therefore, would the Prime Minister assure the House that his government will introduce some measures in this respect, even in the absence of the Minister of Agriculture. Does the government intend to introduce measures in order to satisfy farmers and beef producers?


Pierre Elliott Trudeau: Mr. Speaker, the hon. member is certainly aware that the
Oral Questions
Minister of Agriculture is presently in Rome as a participant to a conference which is extremely important for the food situation in the world. Last week he replied on a number of occasions to questions similar to those of the Social Credit leader. Before leaving, he most certainly brought out the issue during Cabinet meetings and initiated a number of working plans which may hopefully lead to a solution of this problem.


THE BUDGET
Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, have the Minister of Finance and the Prime Minister now completed their consideration of the points of view and exchanges that occurred last Wednesday and Thursday with the provincial premiers, and also between the Prime Minister and the labour leaders, and, if so, would he now tell the House what date he is going to fix for the budget?


John Napier Turner: Mr. Speaker,' I plan to bring down the budget two weeks from now, Monday, November 18. In view of this date, I shall not be announcing plans to deal with the $525 million Government of Canada bonds due December 31, 1974 until the afternoon of November 19.


CANADA-UNITED STATES AUTO PACT-POSSIBILITY OF READJUSTMENT IN VIEW OF DEFICIT
Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, I have a question for the Minister of Industry, Trade and Commerce. In view of the deficit in trade with the United States in motor vehicles and parts of nearly three-quarters of a billion dollars during the first nine months of this year which indicates a deficit for the 12 months of between $1 billion and $2 billion, I should like the minister to advise the House if he is engaged now in discussions with the United States government aimed at a readjustment of this pact which was intended originally to be mutually beneficial to both countries.


Hon. Alastair Gillespie (Minister of Industry, Trade and Commerce):: Mr. Speaker, I believe the pact has been mutually beneficial. I think it has been particularly beneficial to Canada. During this very difficult year, occasioned by the reduction of sales in the United States, Canadian sales have held up and Canadian jobs have held up. I have had discussions with members of the industry on a continuing basis to ensure Canadian interests will be fully secured.

November 4, 1974
Oral Questions


CANADA-UNITED STATES AUTO PACT-REASON FOR CONTINUING PRICE DIFFERENTIAL ON SAME MODELS PRODUCED IN CANADA AND UNITED STATES
George Harris Hees: Mr. Speaker, I have a supplementary question. It may be interesting some day to hear the minister explain how this pact which is giving us a deficit of $1 billion a year is beneficial to the country. Would he explain why it is that Canada continues to agree to a differential of more than 7 per cent in respect of United States and Canadian prices for the same models produced in Canada and the United States which differential it was stated would be non-existent five years after the pact started in 1965.


Alastair William Gillespie: Mr. Speaker, if the hon. member would look at the differential when he was trade minister he would see that it was quite close to 20 per cent. Over a period of years under the aegis of the pact there has been a steady norrowing of the differential. The figure to which I think he is referring is the figure reported by the President of the United States last week in a report to Congress showing the differential had been reduced to 7 per cent. That was based on the beginning of the 1974 model year. As a result of negotiations with the automobile manufacturers in Canada there has been a continual narrowing of the gap in the 1974 and 1975 model years.


George Harris Hees: I have a final supplementary, Mr. Speaker. Is the minister not aware of the fact that I was the one who started the negotiations and that without such negotiations there would not have been any auto pact. Does he feel that the existence of something today, which it was promised at the time of the signing of the pact would not exist, is justified in any shape or form, and if so how?


Mr. Speaker:: The hon. member for Esquimalt-Saanich.


CONSULTATIONS WITH MARITIME PROVINCES ON OFFSHORE RIGHTS-AREAS OF DISAGREEMENT-REQUEST FOR TABLING OF A REPORT
Mr. Donald W. Munro (Esquimalt-Saanich):: Mr. Speaker, my question is addressed to the Minister of Energy, Mines and Resources. In reply to a question I asked the minister on October 23, as recorded on page 645 of Hansard, the minister indicated that the federal and provincial authorities were in substantial agreement on the east coast as to the regime for covering offshore rights and jurisdictions. This suggests there were certain disagreements. Is the minister prepared to tell the House the area in which disagreement occurred. Was it in respect of the nature of the resource or the manner of splitting the revenue from the resource?


Donald Stovel Macdonald: Mr. Speaker, without looking up the answer I think I referred to the fact that four of the five eastern provinces and the federal government were in substantial agreement and the province of Newfoundland was not. In respect of any remaining differences between

the four provinces and the federal government, I could not respond from memory but my impression is that the difference was very slight. One critical matter was how to achieve the interfacing with the very important lines of demarcation between the four provinces and Newfoundland.


Donald W. Munro: Mr. Speaker, would the minister be prepared at an appropriate moment and fairly soon to table a report of the government on the eastern seaboard in respect of these matters.


Donald Stovel Macdonald: I could consider that. I invite the hon. gentleman to reflect on the fact that this is a matter that is in negotiation and I think I would have to decide as to whether tabling it would bring about an early conclusion or might move us farther away from it.


DATE OF COMPLETION OF SURVEY OF STOCKS-ASSURANCE OF ABILITY TO MEET EXPORT COMMITMENTS
Mr. Jack Murta (Lisgar):: Mr. Speaker, I should like to ask the minister in charge of the Canadian Wheat Board whether he can tell the House if the recent survey undertaken by the Canadian Wheat Board as to grain stocks in western Canada has been completed, and if he could give us some indication as to what the survey contains. Could he also assure the House that Canada will be able to meet the export commitments that it has made in the forseeable future?


Hon. Otto E. Lang (Minister of Justice):: The usual survey by the Canadian Wheat Board has been completed. If my memory serves me correctly, as of October 16 there was a balance of about 800 million bushels of grain in total, deliverable on the farms.
While we have to obtain the exact figure for the hon. member, let me say that there are adequate supplies of grain of most types, although there is some concern about the availability of barley for malting purposes. So far as wheat is concerned, there is certainly more lower grade wheat than usual on hand. However, the Wheat Board sees a fairly large supply of good quality wheat left over from previous years as well as a substantial amount in this year's crop. We will be making such adjustments in the selling programs as are required to meet the circumstances.


AMOUNT OF CARRYOVER
Jack Burnett Murta: I should like to ask the minister whether the Wheat Board has given him any indication as to the amount of carryover which they would expect at the end of the 1975 crop year. In other words, is Canada prepared to sell down to approximately 100 million bushels or even less to fulfill all the demands for grain that will be received?


Otto Emil Lang: The Canadian Wheat Board has been working with the estimated car-
November 4, 1974

ryover as of August 1, which may be in the order of 100 million bushels lower than last August 1. There is a requirement for carryover to meet the shipments in August and early September when new grain may not be available in any case. Essentially, the Canadian Wheat Board would be prepared, as would the government, to see the carryover being reduced to as low a figure as is practical. There is always concern on the part of the Wheat Board regarding when farmers will in fact begin withholding the final amount of grain even though they had earlier expected to deliver it, and that is not exactly a science but more a matter of general calculation.


OIL-POSSIBLE REDUCTION IN PRICE BY MIDDLE EAST COUNTRIES IF SOLD TO GOVERNMENT-OWNED COMPANY
Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources. The government of Saudi Arabia has proposed a 3!4 per cent reduction in the price of crude oil with the proviso that this reduction will be passed 6n only to the government-owned national oil companies such as those of France and Italy, and will not be passed on to the multinational oil companies. I want to ask the minister whether, in view of the obvious advantages to the Canadian consumers flowing from such an arrangement, the minister is planning any discussions with the OPEC countries, and is the government prepared to set up a national marketing mechanism which could deal directly with the oil producing countries along the lines suggested in the Middle East economic survey released last week in Beirut?


Donald Stovel Macdonald: Mr. Speaker, I would be quite prepared to have further discussions with various OPEC members along these lines.
As the hon. gentleman may recall from previous statements, this is a proposition which has been communicated to us from time to time. As to putting the mechanism into place here in Canada, there is already a bill on the order paper to create such a mechanism, and as soon as the House can dispose of the petroleum administration act, my priority would be to seek an early passage of the Petro-Canada bill.


Marcel Joseph Aimé Lambert: Oil Can Unlimited.


Thomas Clement (Tommy) Douglas: Does the minister envisage the Canada petroleum company, which will be set up under Bill C-8, entering into the purchase on the international market of oil supplies for Canada?


Donald Stovel Macdonald: This was distinctly contemplated by the government when putting the proposal forward, particularly where it is indicated to us that supplies would be available through the Canadian national corporation for the Canadian market where they might not be available through the international majors.
Oral Questions


OIL-SUGGESTION BY IRAN TO TIE PRICE TO WORLD COMMODITY INDEX
Thomas Clement (Tommy) Douglas: A final supplementary, Mr. Speaker, regarding the proposal of the Shah of Iran to cut oil prices by 14 per cent and his proposal for discussions between the oil consuming countries and the OPEC nations with a view to reaching an international commodity agreement that would tie oil prices to a world commodity index. In view of the fact that this might be more productive than the confrontation which could arise from an international energy agreement such as this government is now contemplating, is the minister pursuing discussions with other oil importing countries regarding the advisability of initiating discussions along the lines suggested by the Shah of Iran?


Donald Stovel Macdonald: Mr. Speaker, in reply I would say we should both enter into the IEP and have these discussions. I have had discussions with the minister of petroleum from Saudi Arabia along these lines and I think the Shah's statement over the weekend will contribute further to this. When I saw the Shah earlier this year, at that time they were reluctant to change the price without some kind of international indexing arrangement such as he has referred to. I think these suggestions are very much worth pursuing.


COST OF MEDICAL CARE-CONSULTATION WITH PROVINCES
Mr. Howard Grafftey (Brome-Missisquoi):: Mr. Speaker, I wish to direct a question to the right hon. Prime Minister.
In view of the fact that the inflation rate in connection with medical services reached nearly 17 per cent, and that the Medicare program is one of the most important federal-provincial cost-sharing programs, I should like to know whether the right hon. Prime Minister had discussions last week with the provincial premiers about that matter and whether he can report progress in this regard?


Pierre Elliott Trudeau: No, Mr. Speaker, that issue has not been raised by anybody.


PROGRAM FOR MONITORING BIRTH DEFECTS-POSSIBLE CONSULTATIONS WITH UNITED STATES
Mr. J. R. Holmes (Lambton-Kent):: Mr. Speaker, my question is for the Minister of National Health and Welfare, but in his absence I will direct it to the parliamentary secretary. It is related to the program for monitoring birth defects which is to commence later this month in the United States. In view of the fact that Canada does not have a similar program, national in scope, for the surveillance of this very serious problem-I can place this in its perspective by referring to the thalidomide problem in the

November 4, 1974
Oral Questions
past-have the minister or-his officials had consultations with United States officials with a view to participating in this worthwhile program which of course has the potential for correcting a very serious problem relating to birth defects which occur in their thousands each year in Canada?


Miss Coline Campbell (Parliamentary Secretary to the Minister of National Health and Welfare):: Mr. Speaker, I should like to thank the hon. member for Lambton-Kent for giving notice of this question. The health protection branch of the department, in co-operation with the provinces, operates the Congenital Anomaly (Birth Defects) Surveillance System. This system has operated since 1970 and was designed to be able to detect increases or decreases in the incidence of congenital anomalies.
The department is aware of the United States system. In fact, a senior official of the department was actively involved and consulted in the early planning stages of their system. We expect to continue to co-operate fully with them and to receive information of their progress and results. If any improvements in other systems come to our attention that we think are feasible, we will use them. We feel, however, that the Canadian monitoring system is as good as any of the others.


AIR CANADA
A. Daniel McKenzie: Mr. Speaker, my question is directed to the right hon. Prime Minister. Mr. Frank Gray, Air Canada's director of information stated last week that Air Canada is waiting for specific instructions from Ottawa on the new $15 million hangar promised by the Prime Minister for Winnipeg. Considering construction deadlines and the kind of facility the government has in mind, can the Prime Minister tell the House when instructions will be relayed to Air Canada?


Pierre Elliott Trudeau: Mr. Speaker, the Minister of Transport answered a similar question a very short while ago and I think he indicated that no specific date had been set when the thing was being proceeded with. It will be ready probably in time for the next-


An hon. Member:: Elections!


Pierre Elliott Trudeau: -fund-raising dinner of the Leader of the Opposition.


AGRICULTURE
Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, I should like to direct a question to the right hon. Prime Minister about the beef situation and ask if he has any announcement today regarding the two policy statements of his Minister of Agriculture last week, that is, the comprehensive inquiry and the stabilization measures for beef producers this winter. Has he an announcement to make today and if not, why not?


Pierre Elliott Trudeau: Mr. Speaker, if the hon. member looks at the answer I gave to the question asked by the leader of the Social Credit party today, he will see why not.


PENITENTIARIES
Mr. Claude Wagner (Saint-Hyacinthe):: Mr. Speaker, I would like to ask the Solicitor General a question.
In the night of Friday to Saturday, policeman Aime Pelletier and Dr. Gaston Perreault from Montreal have been shot to death presumably by a Cowansville inmate who was serving a life term for the killing of a taxi driver.
Is it true that Arthur Gagne, a convict, was illegally free since August 18 and that the MUC police services have been formally informed of his disappearance by federal authorities on September 8 only?


Hon. Warren Allmand (Solicitor General):: Mr. Speaker, Mr. Gagne has been absent since August 15, 1974. I had not heard the allegation that the police had not been advised until that date and I will have to check on that. I may say that the only news we have so far that Mr. Gagne is suspected of committing this murder is a story in the press. There has been no further evidence than what we have read.


NATIONAL SECURITY
Claude Wagner: Mr. Speaker, I would like to ask the Minister a supplementary question and tell him, first of all, that the request was made to him by the president of the Security Council, Mr. Paul-limile L'Ecuyer. I would also like to ask him whether, while he is waiting for a more detailed report on that matter, he could inform the House on the report he would have finally got on the CIA activities in Canada, following the CBC disclosures and following the specific question I put to him last week?


William Warren Allmand: Mr. Speaker, with respect to the questions put to me last week about
November 4, 1974

the CIA, to the best of my knowledge we have not yet received a transcript from Radio Canada but we put the request to them the day the question was asked.


TRANSPORT
Mr. Charles Lapointe (Charlevoix):: Mr. Speaker, I would like to put a question to the hon. Minister of Transport.
Could he tell the House whether he is aware of the collapse, during this past week-end, of the Tadoussac wharf which was used by ferry-boats on the Saguenay, thus compelling truckers heading toward or coming from the northeastern part of the province of Quebec to take a diversion road which makes a trip over 200 miles longer? And in the affirmative, could he tell the House if he intends to take emergency action to deal with this problem?


Jean Marchand: Mr. Speaker, I am aware of the accident which seriously hinders traffic on the North shore. Unfortunately, it is not in accordance with federal policy to maintain, repair or rebuild wharves linking two sections of a road located within the same province. This means that the province of Quebec will have-what I say is right, Mr. Speaker-to repair this wharf itself. If we can be of any help in the meantime, we shall be glad to do so.
* * +


REGIONAL ECONOMIC EXPANSION
Mr. F. Oberle (Prince George-Peace River):: Mr. Speaker, my question is for the Minister of Regional Economic Expansion. Several days ago in response to a question he said that his department was anxious to enter into the final agreement with the province of British Columbia but he had not received a response from them. Can the minister tell the House why that province does not find the program of regional economic expansion as attractive as the other provinces find it?


Hon. Donald C. Jamieson (Minister of Regional Economic Expansion):: No, Mr. Speaker, I cannot answer that question in the terms used by the hon. member. I can say, however, that subsequent to his question I made some inquiries and the Northwestern Development Agreement for British Columbia is moving ahead quite satisfactorily. I got the impression that it will be possible for us to reach agreement on specific projects in the relatively near future. I would repeat what I said earlier; we are prepared to go ahead as fast as possible and are ready to discuss
Oral Questions
these matters with the government of British Columbia at any time.	.


TRANSPORT
Mr. J. M. Forrestall (Dartmouth-Halifax East):: Mr. Speaker, I have a question for the Minister of Transport, further to one I asked a few days ago regarding the 40-40-20 formula with respect to the movement of goods in and out of Canada and the very real possibility of a Canadian merchant fleet being built up for the first time in 30 or 40 years. Can the Minister give us some indication of what Canada's position will be with regard to ratification of that accord?


Jean Marchand: Yes, Mr. Speaker. I looked into the question. The hon. member is right. There was a meeting of about 70 countries. The agreement is in force to the extent that 28 or 30 countries ratified it. That is not yet true. It has not yet been done. That means the agreement is not in force. With regard to the substance of the problem, if we decide to use our own ships for about 40 per cent of our international trade, there will be implications which the hon. member understands. I am inclined to support the idea which the hon. member expressed, that he is in favour of a merchant marine in Canada.


J. Michael Forrestall: Mr. Speaker, I rise on a question of privilege. I do not want the minister to leave the impression that I indicated Canada had indeed ratified this. Rather, I was asking whether Canada intended to ratify it, having abstained from voting in principle.


Jean Marchand: Mr. Speaker, at this moment we do not have the intention to ratify. We must wait until we know whether we will be in a position to implement the agreement.


Mr. Speaker:: The hon. Leader of the Opposition. [Translation]


David Réal Caouette: Mr. Speaker, I rise on a point of order. Since the beginning of the question period, two of my colleagues, the hon. members for Roberval and for Bellechasse, rose 22 times to put questions. Mr. Speaker, I do not know whether we are classified in the same category as the hon. member for Moncton, but it seems to me that we should get the eye of the Chair a bit more often-


Mr. Speaker:: Order, please. The hon. member for Temiscamingue will note, I am sure, that there are exactly five creditists members in the House at this time. I intend to recognize a second creditist member during the question period. This, to my mind, is a fair proportion under the circumstances.

November 4, 1974
Oral Questions CONSUMER AFFAIRS


TAX CUTS ON CLOTHING-REASON FOR DELAYING MONITORING PROGRAM
Robert Lorne Stanfield: Mr. Speaker, those difficulties now over, I wish to put a question to the Minister of Finance-

Mr. Speaker, my question is to the Minister of Finance. In his May budget, the minister undertook to eliminate taxes on clothing. This was in fact done on July 16. The minister stated that if these tax cuts were not passed on and reflected in prices, he would take steps to ensure that the consumer does in fact gain. Recognizing that most retailers will automatically comply, will the minister advise whether he has received assurance from the Minister of Consumer and Corporate Affairs that that minister has in fact been monitoring what has been going on and that in all cases the prices reflect these tax cuts.


John Napier Turner: Mr. Speaker, I have received that assurance. I look forward to receiving a full report from my colleague in due course which will answer in detail the question posed by the hon. Leader of the Opposition.


Robert Lorne Stanfield: Mr. Speaker, it is now some 14 weeks since the tax was removed. I wonder how long the minister intends to wait. I now wish to ask the Minister of Consumer and Corporate Affairs whether he has any explanation for the fact that it is only this week he is commencing his investigations to ascertain what is happening.


André Ouellet: Mr. Speaker, the whole thing is very simple. We wanted to have a pilot project to delineate the investigation more specifically. This project took place in September. We analyzed the answers given to the questionnaire sent out in connection with the project. A complete investigation is now under way with a more complete and improved questionnaire.
I can assure the hon. member that no matter when the investigation takes place, it is really of very little importance because, if the tax is levied, whether we know the results today, or whether we did 15 days ago, will in no way change the situation.


Robert Lorne Stanfield: Will the minister be good enough to explain how a customer who did not receive the benefit of the tax cut in October or even November can receive this benefit as a result of the minister's tardiness in not discovering until some months later that the tax cut had not been passed on.


André Ouellet: Mr. Speaker, obviously the companies that do not pass the tax cut on to the consumer will be named following that investigation. And I think that is a guarantee for the consumer.


TAX CUTS ON CLOTHING-NATURE OF PILOT PROJECT FOR MONITORING BENEFIT TO CONSUMER
Mr. James A. McGrath (St. John's East):: Mr. Speaker, I have a supplementary question for the Minister of Consumer and Corporate Affairs. What was the exact nature of the pilot project carried out by the department in September, and did it in fact reveal that retailers were not passing on tax cuts to consumers?


André Ouellet: No, the pilot project was carried out in the Toronto area and the answers we got showed that the tax cut was passed on.


INDUSTRY
Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, I am very happy to see that my colleagues are glad when I rise to ask a question. My question is directed to the hon. Minister of Industry, Trade and Commerce.
In view of the fact that several textile manufacturers now have difficulties competing with imported textiles and that they are forced to lay off people, can the hon. Minister tell the House whether he has had representations from the people concerned in this industry asking for him to intervene in order to stop or to reduce if possible imports in this area?


Alastair William Gillespie: Mr. Speaker, we have been made aware of the difficulties in the industry occasioned by a worldwide downturn in textile demand and activity. This is causing inventory liquidations and distress selling. So far we have not been able to determine that any landings have been made as dumping or undervaluation of imports. We are maintaining continuous contact with the industry in this regard. In accordance with the provisions of the textile policy, the Textile and Clothing Board is currently conducting an urgent inquiry into acrylic yarn imports. Further similar inquiries on a number of other products are anticipated in the near future as a result of requests from the Canadian Textiles Institute.


Joseph Adrien Henri Lambert: Mr. Speaker, I have a supplementary question.
Can the Minister tell the House whether import licenses have been issued during the last months by his department and in the affirmative, for which countries?


Alastair William Gillespie: Mr. Speaker, I will have to make inquiries as to the precise number of import permits granted, what countries and, of course, what products. I will be pleased to make inquiries and provide that information to the hon. member.
*


November 4, 1974


FINANCE
Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, I have a question for the Minister of Finance. Can the minister tell the House if the prime rate will follow the United States rate in declining once the Canada Savings Bonds are sold or shut off?


John Napier Turner: Mr. Speaker, I am sure the hon. member is aware that it is very difficult for me in this position to predict movement of exchange rates, interest rates or other variable factors in the economy insofar as they may affect market decisions.


William Gordon Ritchie: Can the Minister of Finance explain why the prime rate in Canada immediately follows a corresponding rise in the United States but lags behind when the U.S. rate falls?


Mr. Speaker:: Order, please.


ENVIRONMENTAL AFFAIRS
Mr. John A. Fraser (Vancouver South):: Mr. Speaker, my question is for the Prime Minister. It follows from the motion of my colleague, the hon. member for Winnipeg South Centre, which was ruled out of order. In view of studies that show if aerosol discharges continue at the present rate, there is a serious probability of danger to life on this planet and in view of Professor Knelman's recent warning that "a crash program to establish the validity of this new ozone threat should be immediately instituted and the results brought before the world", will the Prime Minister advise whether the government is prepared to refer the matter to the Standing Committee on Fisheries and Forestry of whether the Atmospheric Research Branch has sufficient funds and personnel to adequately deal with this urgent problem?


Pierre Elliott Trudeau: Mr. Speaker, this is a problem about which I have expressed some concern myself but I have not had a recent report from the Minister of the Environment who is meeting with officials of the James Bay Development Corporation in Montreal. I will make sure the question is referred to her to be dealt with.


IMMIGRATION
Mr. Arnold Malone (Battle River):: Mr. Speaker, I should like to direct my question to the Minister of Man-
Oral Questions
power and Immigration. It arises .rom the minister's recent statement on immigration policy that special incentives would be provided for Francophone applicants. Will preference be given to placing such applicants in any particular region of Canada once they are here?


Mr. William Rompkey (Parliamentary Secretary to the Minister of Manpower and Immigration):: I can only refer the hon. member to what the minister said in his statement. The fact is that Francophone immigration will be encouraged and that it will direct itself, quite obviously, to regions in Quebec. We are discussing this matter with the government of Quebec and I should like to point out that these regulations will apply across the board to all countries, including those from which Francophone immigration might come.


MULTICULTURALISM
Mr. Steven E. Paproski (Edmonton Centre):: Mr. Speaker, may I direct a question to the Minister of Labour in charge of multiculturalism? Since the draft report on non-official languages has been ready since April, can the minister advise us when the study on non-official languages commissioned by the hon. member for Hochelaga, now Minister of Communications, in November, 1972, will be laid on the table?


Hon. John C. Munro (Minister of Labour):: The hon. member says the report was ready in April, but I do not believe that is correct. In any case, the hon. member is referring to the draft report; I do not believe the final report is in my hands even yet. However, I will check and report to the hon. member.


Steve Eugene Paproski: A supplementary question, to the minister: out of the 70 recommendations which were made by the former minister responsible for multiculturalism, the hon. member for Parkdale, the great Dr. Stanley Haidasz-


Some hon. Members:: Hear, hear!


Steve Eugene Paproski: -at the conference on multiculturalism a year ago, could the minister name just one of those recommendations which has been implemented?


John Carr Munro: May I say from my own visits to minority groups and ethno-culture groups across the country since I have been the responsible minister that they have nothing but praise for the hon. member for Parkdale and the excellent job he did.


Some hon. Members:: Hear, hear!


John Carr Munro: Of course, at some of the meetings I have attended, even some of those held by the Ukrainian community in Canada, the hon. member himself was missed. I might add that several of the recommendations have been implemented.

November 4, 1974
Oral Questions LABOUR CONDITIONS


PROPOSAL TO ESTABLISH TRIPARTITE BODY COMPOSED OF LABOUR, MANAGEMENT AND GOVERNMENT-GOVERNMENT ACTION
Mr. Lincoln M. Alexander (Hamilton West):: Thank you, Mr. Speaker. I should like to direct a question to the Minister of Labour notwithstanding the fact that the meeting of leaders of the trade union movement with the Prime Minister last week was a failure-it has been called just a little social get-together. Is the minister enjoying more success in terms of forming a tripartite body embodying labour, management and government so as to deal with the serious matter of the collective bargaining process in the future? Is the minister experiencing more success than the Prime Minister in dealing with inflation?


John Carr Munro: Both the Prime Minister and myself have been meeting with labour officials. We have held meetings, and my deputy has held meetings, with representatives of the chambers of commerce and others on the business and industry side. There is general agreement that attempts to work out solutions within the framework of a tripartite arrangement are welcome and we are figuring out ways and means of getting on with this now. The prospect is most encouraging.


MEETING IN QUEBEC CONCERNING IMPACT OF MULTINATIONAL CORPORATIONS ON COLLECTIVE BARGAINING-REASON FOR NON-ATTENDANCE OF FEDERAL REPRESENTATIVE
Lincoln MacCauley Alexander: In the
light of the minister's concern with respect to the impact of multinational corporations on the collective bargaining process in Canada, can the minister tell me why his department will not be represented at the meeting of a special national assembly committee next Wednesday called by his colleague, the minister of labour in the Province of Quebec, which will, apparently, study the entire question of the dispute at United Aircraft and will ask the company to justify its attitude toward striking employees? I ask this question bearing in mind that the minister is now considering the impact of the situation at Firestone. I know he is looking at the United Aircraft experience. Can he tell us why his department will not be represented at this meeting, if only by holding a watching brief?


John Carr Munro: As the hon. member himself acknowledges in his question, this is a meeting called by the minister of labour of Quebec within his own jurisdiction in his own province. Obviously, it is up to him who he chooses to invite. If he feels our presence could be helpful we shall, no doubt, attend, at least in the capacity of an observer.


Lincoln MacCauley Alexander: This meeting is, of course, a most important one, particularly since the minister is looking into this very area. Can the minister give us an assurance that he will get in touch with his colleague in Quebec to see whether his departmental officials can attend?


John Carr Munro: I will be happy to take that suggestion under consideration.


A. Daniel McKenzie: On a question of privilege. Due to the commotion in the House, when I asked the Prime Minister about the Air Canada base in Winnipeg, I believe he made the comment that he would be making an announcement at the forthcoming Conservative fund raising dinner. I would like to notify him that this will be held on November 28 of this year.


Some hon. Members:: Oh, oh!



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Friday November 1, consideration of the motion of Mr. Macdonald (Rosedale) that Bill C-32, to impose a charge on the export of crude oil and certain petroleum products, to provide compensation for certain petroleum costs and to regulate the price of Canadian Crude oil and natural gas in interprovincial and export trade, be read the second time and referred to committee of the whole.
Claude Wagner: Mr. Speaker, Bill C-32 now before us sets the whole question of the Canadian challenge for the present time as well as for the future. National interest must be based of course, on all Canadians being on the same footing. It must also be based on the same quality of life for everyone. But distributed as Canadians are in this great country of ours and administered by three levels of government, national interest in their case rests also and by far on the reconciliation of various social and economic interests at play in this country. Now, the identification of such social and economic interests depends on the full respect of the spirit as well as the letter of our Constitution, and of the jurisdiction of each Canadian province.
Therefore, it is right to say that Bill C-32 on oil and gas administration in this country sets the whole question of the Canadian challenge. Perhaps have I never before, at least in this House, had the opportunity to feel as responsible as a Canadian, as jointly liable in connection with the interests of my fellow citizens from the western provinces, who are very much concerned as we know about this bill and perhaps have I never felt as determined to understand and comprehend the concerns of fellow citizens in kin provinces. In the name of national interest, sections 36 and 52 of this bill come in direct contact with the prerogatives and vested rights of the so-called oil provinces.
I feel all the more I have to be alert on this Bill C-32 because once it is passed, all of us, whether from the
November 4, 1974

Maritimes, Ontario, Quebec, or elsewhere, will be faced with a precedent on the basis of which a centralizing government as the one currently heading this country will be able in the future to take over provincial jurisdictions somewhat too easily. All Canadians, all Quebecers in particular, and the premier of the province of Quebec above all, must give very urgent consideration to the scope of this bill now before us. Today, there is talk about federal administration of oil and gas but if we are not careful today, tomorrow there may be talk about federal administration of power energy, or from another angle, territorial development and-
Mr. Speaker, in the very name of the Canadian challenge of modern times, in the very name of the type of Confederation in which we want to live Bill C-32 must provoke at the level of the people of this country, of provincial governments and information media, an information campaign on the stakes and the issues involved.
Mr. Speaker, consideration of Bill C-32 must actually bring people to their feet, have them talk with words of caution, warning and alertness.
Section 36 of the Bill reads as follows:
Where no agreement is entered into pursuant to section 22 with the government of a producer-province or any such agreement is terminated by the declaration of the parties, or, in the opinion of the Governor in Council, is not effective or is not capable of being effective, the Governor in Council may, by regulation, establish maximum prices for the various qualities and kinds of crude oil to which this Part applies that are produced, extracted or recovered in that province (hereinafter in this Division called the "exporting province").
Mr. Speaker, Canada or indeed the whole world must be experiencing a true energy crisis or about to experience such a crisis for the government to consider disregarding the vested interests of the provinces, for a central government to assume such powers.
And yet, Mr. Speaker, people will probably say: the facts are there, the world is undergoing serious energy problems; let us think, they will say, of the Arab-Israeli conflict, of the behaviour of oil-producing Arab countries on the world market, let us also remember above all that oil supplies in eastern Canada depend to a large extent upon imports, and therefore, is it not normal that we, as a government, should take appropriate action to meet the following objectives as stated in clause 21 of the bill:
(a)	to achieve a uniform price, exclusive of transportation costs, for
crude oil used in Canada outside its province of production;
(b)	to achieve a balance in Canada between the interests of consumers and producers in Canada: and
(c)	to protect consumers in Canada from instability of prices for
petroleum in the international markets.
With regard to those national objectives, may I just mention very briefly two specific points.
First, concerning the protection of consumers in Canada from instability of prices for petroleum in the international markets, I should like everyone here to remember how decisively our party fought in December 1973 to ensure equity and justice for the consumers of eastern Canada.
The Leader of the Opposition (Mr. Stanfield) was waging this fight. On December 10, 1973, he said:
-this policy will result in a difficult and trying period for many individuals this winter, a promise of continued discrimination for
Oil and Petroleum
many years, a proof of increasing inequalities, and a guarantee of economic problems for eastern Canada.
In the name of justice, we, of the official opposition, demanded then and still demand that Canadian consumers be protected from the instability of prices in the international markets.
Secondly, and still from the point of view of the national objectives mentioned earlier, we must realize that we must also protect the interests of producers on behalf of the long term interests and needs of all Canadians.
On October 4 last, Mr. R. G. Reid, president of Imperial Oil Limited, said to the Ontario Institute of Chartered Accountants, and I quote:
The key to the development of future energy resources is the investor's confidence based upon risk-oriented public policies.

It is therefore crucial, Mr. Speaker, for this parliament and the government to keep in mind that the present energy resources available to this country exist because in the past the exploration and production of energy for domestic and export use has been a highly profitable endeavour.
When one briefly scans Canadian commercial history and views the extent to which a serious imbalance has existed between western and central Canada, particularly in terms of transportation and freight rates, one need not be particularly pro-western in one's approach to understand that the commercial unity of this country would be strengthened by rectification of this imbalance. One cannot help getting the impression that the present government's view of the degree to which profits from the oil industry can serve to rectify this imbalance is less than favourable.
I have to say, as a member of this House from a province that has itself in the past developed various profitable energy sources, that this type of view by the federal government is particularly short-ranged and somewhat narrow-minded. I can tell the House that when Hydro-Quebec moves to sell power to markets outside our province and outside our country, it is always done with a very real concern for ensuring the people of Quebec maximum profit for what is, after all, a renewable resource. Surely, therefore, we can understand the concern of jurisdictions wherein the major energy resource is non-renewable as is the case with petroleum products that there be similar, if not greater, protection in terms of increased profit yield for them, to ensure their economic vitality.
I believe we can find the way to protect the public interest, while ensuring that the exploration and processing of energy products, specifically in western Canada, remain activities not only profitable to private enterprise but profitable to provincial governments that are seeking to strengthen their own secondary industry and economic infrastructure through the yield that can be gained from the petroleum industry situated within their jurisdictions.
There is anxiety in the west that has caused many petroleum operations actively to consider moving their drilling rigs from Canada to other countries. Such a course of action, specifically in areas such as southern Alberta,

Oil and Petroleum
cannot be anything but a source of concern for anyone vitally interested in the health of the western economy. I believe parliament would do well to ensure that legislation presented to protect the public interest in the matter of petroleum and energy embraces a concept of public interest that has room for the type of fair profit within the oil industry that can, and will, play a significant role in prolonging the commitment of capital and other resources in the battle to find and to develop more natural resources for Canadians.

Mr. Speaker, the national objectives mentioned in clause 21, the national balance that is sought, all this must be worked out simultaneously by the central government and of each of the provincial governments. We federal and provincial parliamentarians must therefore reconcile the national and the regional interests. And, as I said earlier, one can see how this bill raises the whole question of the Canadian challenge and affects, if I may use this expression, the Canadian pattern itself.
Clause 36 as well as its counterpart clause 52 make it too obvious that in case of a disagreement, the federal government is automatically right. This does not take into account the reasons for which, in a particular situation, an oil producing province may not accept some proposal of the federal government. Yet, this directly concerns provincial jurisdiction.
Mr. Speaker, on December 10 of last year, I said that this government was powerless to attack in depth the major problems and unable, in its search for adequate solutions, to reconcile the national and the regional interests. This government, under the pretext of acting for the common good, keeps infringing upon the principle of Canadian federalism itself.
The present federal government, probably the most centralizing one in all our country's history is certainly the government who has provoked and is still provoking, sometimes, almost on purpose the highest number of confrontations with the provincial governments.
Instead of trying to be, as the Minister of Supply and Services (Mr. Goyer) rightfully wishes-it is true, Mr. Speaker, that this was said during the last election campaign-instead of trying to be, and I quote: the life and soul of a common, collegial and global strategy the present central government is appointing itself, slowly but surely and month after month, the gravedigger of our Constitution.
Mr. Speaker, this government and this prime minister will be known to history as those under whom our Confederation will have been in danger as never before. We know, especially after the cry of alarm of last June 15 uttered by the hon. member for Peace River (Mr. Baldwin) we know how threatening for the Confederation this alienation of the West is becoming. Transportation, the difficulties of the secondary industry and natural resources sector, those are problem areas where Western Canadians feel neglected by this federal government.
Should we now be surprised that the oil producing provinces, before approving, if ever, Bill C-32 demand, just

by so proof positive of Ottawa's good faith concerning the planning of industrialization policy, agricultural consolidation and restructuring of the railway freight rates in the Prairies.
In the province of Quebec, as everyone is aware, we have but to look at the provincial scene, examine the results of the last election and see the presence and the vitality of a separatist party. In Quebec, almost 30 per cent of the French-speaking population have voted for that party; this should certainly be good enough, above and beyond the language aspect, to demonstrate to this federal government how more and more Quebecers are fed up with the centralizing schemes of this federal government.
Mr. Speaker, the province of Quebec must and should be in the forefront of those who fear any unilateral application in the oil administration policies of this country. I want to be very specific here: I am addressing myself directly to the political authorities of the province of Quebec, to the Quebec premier and I say to him that any lightly considered acceptance of a precedent, as would be the passage of Bill C-32 might-


Robert Lorne Stanfield: Where are the members from Quebec?


Claude Wagner: The Leader of the Opposition (Mr. Stanfield) asks with reason, where are the Liberal members from Quebec who should be rushing forward to defend the sacred rights of the province and thus make sure that no blow is struck against provincial jurisdictions and that the rights of the provinces are respected. Where are those members?


Mr. Bussieres:: That is pure demagogy.


Claude Wagner: There is someone in the fifth row, on the other side who says: "That is pure demagogy".
So, Mr. Speaker, it seems that talking in favour of provincial autonomy means demagogy, claiming the respect of Quebec's rights means demagogy for the Liberals, to pointing out the very serious error this government is about to make, also means demagogy.


An hon. Member:: He did not mean that.


Claude Wagner: The only thing which would not be demagogy would be for Quebec to creep on all fours or to fall on knees in front of this government and say: "You served us quite well when you took away our goods". The people of the province of Quebec are not prepared to do so and if only members from this side of the House are moving, they will know how to voice claims for the province of Quebec. If the Quebec government cannot deal on an equal basis with the federal government, that will be the duty of the official opposition and we will assume it.
Mr. Speaker, that is a short answer-As I do not hear any other exclamation from hon. members opposite. I will then continue.


Mr. Marcel Roy (Laval):: Mr. Speaker, I raise on a point of order. I would not reply in any way to the hon. member for Saint-Hyacinthe (Mr. Wagner), but I know that many members from Quebec are now sitting on several committees and I would like to point out to him that he is the only Progressive-Conservative from Quebec here now.
November 4, 1974

Oil and Petroleum
Let Quebec authorities beware, lest they be tricked.
Here is my question: How could we reconcile his suggestions in order to meet the interests of both consumers and producers? That is what we would like to learn from the hon. member for Saint-Hyacinthe.


Claude Wagner: Mr. Speaker, I appreciate the confidence of the hon. member for Laval (Mr. Roy) is showing in order to help me to find the right solutions the government is unable to find. If he will exercise patience and wait until I have completed my remarks, he will have the answer. Will he, in the liberal caucus, be the spokesman for the Conservative party in telling the government that such answers have to be implemented? I doubt it, but knowing the member for Laval (Mr. Roy) for his generosity and good nature, I thank him for his gesture.
Mr. Speaker, I said that any inconsiderate acceptation by the province of Quebec of the precedent set by Bill C-32 might very well affect that province in its possible foreign or domestic sales of resources from James Bay.


Frank Oberle: I rise on a point of order, Mr. Speaker. There does not seem to be any translation of my colleague's remarks and some of us are having difficulty following the debate.


Mr. Baldwin:: There is too much static from the Liberals.


The Acting Speaker (Mr. Penner):: I am sure this has been noted by other hon. members, and that the persons responsible are attempting to solve the problem. I suggest that the debate should continue, and members who miss any part of the hon. member's speech will read it in tomorrow's translated version of Hansard. The Chair regrets the inconvenience caused hon. members.


An hon. Member:: Big loss.


Claude Wagner: Mr. Speaker, I also regret that there is no interpretation at this point, there is no doubt a technical difficulty; I am told it is coming on again, and knowing the expertise shown by translators, I am certain it is for good.
Mr. Speaker, I still hear interruptions from my honourable colleague opposite. If he wishes to say something, let him rise. It is amazing, Mr. Speaker, how eloquent those people are when they are resting on their derrieres. When they stand up, we can't hear them, but when they sit, everything is loud and clear.
If the precedent was set, Mr. Speaker, it would be a bad joke for Quebec, especially in its foreign or domestic sales of the resources from James Bay or any other source. And speaking of Quebec, this debate gives me the opportunity to raise, and get an answer for, the point already made by Saskatchewan's premier, that is whether the federal government could find itself in a position where it had to make $400 or $500 million transfer payments to Quebec, if Alberta and Saskatchewan oil revenues were deemed to be standard revenues of both provinces? That question asked by the Saskatchewan premier is still unanswered by the government, and perhaps remarks from the other side of this House will shed some light on the matter.
Mr. Speaker, it can be seen by examining Bill C-32 that many important questions are raised such as the provincial jurisdiction over natural resources. It is however evident, pursuant to section 109 of the British North America Act, that oil is under the exclusive jurisdiction of the provinces.
However, the federal government, supposedly in the general interest of Canadians which must have precedence over the interest of one or several provinces, wants to control the sale and distribution of oil. When one goes against a particular section of the constitution, even in the general interest, every other aspect of its position must be irrefutable which, in this case, it is not as we can see day after day.
Nothing underrates a great principle more-here, that of the precedence of the general interest-than putting it to an end less noble than its original object and to justify an argument-causing approach.
Mr. Speaker, Bill C-32, and in particular sections 36 and 52, is a very sad way for a prime minister to reopen the constitutional file! What a funny way of reopening it by beginning this session with a large breach to the constitution! What guarantees do we have that the repatriation of the constitution, urged by the Prime Minister before the House on October 2nd last, is in keeping with a national strategy serving the country's regional interests? Mr. Speaker, one can assume the worse.
The Canadian Chamber of Commerce is a neutral organization, without any political affiliation that I know of, and which surely cannot be accused of partisan spirit in its papers, reports and recommendations. During its annual convention held in Winnipeg in September 1973, however, it has warned this government that any energy policy, and I quote:
-could only be developed if the parties concerned could solve their differences in an atmosphere of consultation and mutual trust rather than in an hostile and distrustful one.
It is nto the opposition which is attacking the government and suggesting that the atmosphere is hostile and distrustful, but an intermediate and completely independent organization.
It is precisely an hostile and distrustful atmosphere that clauses 36 and 52 are inducing.
Mr. Speaker, we oppose the bill such as drafted and we demand at the same time in order to meet the objectives provided in the bill and stated for example in clause 21, the establishment of a mechanism which would enable all legislative partners included in our constitution, namely the provinces and the federal government, to express their views on the concept and formulation of the national interests and on the enforcement mechanisms for bills and other measures proceeding from them.
This objective, honest and realistic solution may be the one which the hon. member for Laval (Mr. Roy) was expecting and which he intends to plead for during his next caucus.
Mr. Speaker, this is an excellent way to really protect in a viable way and for a long time the interests of consum-

November 4, 1974
Oil and Petroleum,
ers from Eastern Canada and the other regions of our country, and those of all Canadians. We must keep in mind that there are circumstances when a consumer and a Canadian are the very same person.
To proceed otherwise or along the line suggested in this bill would be to preserve and perpetuate a federalism which thrives on confrontations. I cannot accept the pessimistic view that our federal system can only develop through confrontations and conflicts.
At present, whether we are dealing with the distribution of energy resources or something else, the main problems require in a country such as ours, permanent mechanisms of consultation and concertation whereby, especially in cases of national emergency, provincial governments may deal as equals with the federal government.
There, as in other areas such as the fight against inflation for instance, the federal government must first of all find a reason for determination, stick to a sustained resolution to really accept the challenge it is faced with, that is to provide itself with a national approach and with national consultation mechanisms in the face of national problems.


Marcel-Claude Roy: Decision in consultation!


Claude Wagner: Mr. Speaker, I apologize for interrupting the hon. member for Laval who has lost his temper again. He would want the decision to be made in consultation. As for myself, I would like to have first consultation, then dialogue, decision, all that being done between parties with some measure of justice and equity.
This is much more useful and much better than, as it is the case with this legislation giving powers to act unilaterally under Section 36 and 52 of Bill C-32.
These, Mr. Speaker, are some of the thoughts which this legislation evokes to me. This is why I was glad to participate in this debate. Hoping that my colleagues' comments will induce deeper thoughts on the part of the government members and that within a few days it will lead them to amend their legislation so that it .does not prejudice so obviously the Canadian constitution that we want to protect, to repatriate in due time and especially to make sure that it is really respectful of the rights of all Canadians.


The Acting Speaker (Mr. Penner):: Order, please. The Chair is prepared at this time to recognize the hon. member for Waterloo-Cambridge (Mr. Saltsman). Before doing so, I would remind the House that the hon. member for Waterloo-Cambridge had the floor and had taken up about six minutes of his time when the debate adjourned last Friday. Because of an unavoidable delay, he could not be here at the outset of the debate today. I am sure the House would agree with me that he should be recognized at this time.


Gerald William Baldwin: Make it worth while.


Mr. Max Saltsman (Waterloo-Cambridge):: Mr. Speaker, through you I should like to express my appreciation to hon. members. I will try to be gentle with my friends to the right. I listened with great interest to the hon. member for Saint-Hyacinthe (Mr. Wagner) in his learned develop-

ment of the constitutional responsibilities involved in this question. It is very difficult at this stage to know to what extent the federal government actively has met and negotiated with provincial officials, and whether in fact the government has acted more precipitously than might otherwise have been the case. It is very difficult, also, to know whether agreement might have been reached that the government did not reach, or whether hon. friends to my right might have been able to reach agreement in a way that the government could not.
I can only say I am glad that the federal government acted when it did. It is very hard to know just how much of its action was necessary. What is important is that had the government not taken a firm stand, Canada would have been in desperate straits for energy last winter and the price of energy would have risen substantially in every part of this country. It was vitally important, failing general agreement-which all of us would like to have seen arrived at-that the government exercised, in what I think was its clear jurisdiction, responsibility in the field of energy and brought in measures to see that energy prices were equalized and energy was available to Canada.


Marcel Joseph Aimé Lambert: You say this only on oil and gas, but on other things you would be very quiet.


Max Saltsman: No, I would not be quiet. My friend, the hon. member for Edmonton West (Mr. Lambert), says I would be quiet on other things. He thinks I speak about gas and oil because they happen to be resources within the favourite province of Alberta. The remarks I intend to make apply, in fairness, to all forms of energy. They apply to hydro, to coal and to nuclear energy-if we are to be one nation. The point is not that at the moment Alberta happens to be very wealthy in certain resources and therefore we should grab at its resources. I should like to remind the hon. member for Edmonton West that Ontario assisted his province when energy was a glut on the market; when we could not give oil to the United States even though we pleaded with them to take some.
In the 1960s, when a national energy policy was introduced, the idea was to stimulate western development and to give them an outlet for oil in eastern Canada although the east could obtain oil elsewhere at a lower price.


Marcel Joseph Aimé Lambert: And waxed fat on the material that went out to the oil fields.


Max Saltsman: As the hon. member says, Ontario did wax fat on the material going to the oil fields. There is no doubt that Ontario benefits from what it sells to the west and to the east. I hope all parts of the country benefit from confederation. Nobody is disputing the value of the west to Ontario. It was certainly one of the arguments made to Ontario in order to get a national oil policy. The point I am trying to make, Mr. Speaker, is that subsidies and assistance did not start with Alberta giving oil to the rest of Canada at a lower price. There is a long history of this kind of assistance, and Ontario did its part in helping the west to develop: it provided the market for western goods. Now the shoe is on the other foot. Ontario does not possess fossil fuel reserves. During the winter, we were in danger
November 4, 1974

of not getting any from offshore and it is a great comfort to Ontario to know there are resources in Alberta and we are not dependent upon the political whims of people outside the country to determine whether we freeze in the dark.
I have been very pleased by the speeches of western members on this subject. It seems that they understand the problem. Although they may not like accepting a lower price for crude oil than they could get on the open market, I think they understand that this has to be done in a confederation such as ours. I should, therefore, like to say "Thank you" to the people of the west. We in Ontario appreciate that we might not now have been in such good shape regarding energy had it not been for developments in Alberta.
We have gone a long way toward public intervention in the field of energy in order to assure supplies and to adjust the price. But we will have to go much further. Energy is so important, and the problem so complex, that I believe all energy supplies must come under public ownership-not just gas and oil but hydro and nuclear energy. And if the day comes that we are sufficiently intelligent to harness the tides or to obtain energy from the sun, this energy too would have to come under public ownership and be the heritage of the people of this country. We might even go beyond that and say it would have to be the heritage of the world: Canada might not be able to keep it to itself if the rest of the world needed it.
If we come to the conclusion that we are going to share our energy, surely our first responsibility is not to the richest country in the world, one that can find substitutes for cheap energy, but to the poorer nations. Those of us who complained about a continental oil policy did not do so because we did not want Canada to contribute in this sense. We objected because this resource was not going to the poor and the underdeveloped people of the world, but was going to those who are looking for cheap fuel and show no inclination of conserving energy by using their technology. I do not want to see any province or town in this country hoarding something and not feeling an obligation to anyone else, nor would I want this country to tell the rest of the world to look after itself.
We must move toward public ownership in order to solve the problem of conservation. One of the difficulties with free enterprise is that it must waste resources. The profits come from selling things to people whether they need them or not. Then there is a trade-off between the short-run interests of investors and the long-run interests as defined by the political process. I am not trying to make an ideological argument that public ownership is more holy than private ownership, Mr. Speaker. Some of us do favour public ownership over private ownership. However, the argument I am trying to make is essentially on the ground of public interest.
This is the kind of argument that was made when the Ontario government moved to take the hydro resources of the province under public ownership. In that case they were not socialist arguments, although people acted in a socialist and intelligent way by putting them forward. Their reasons were not ideological, but practical. The embryonic manufacturing industry of Ontario was in danger of falling under the control of outsiders who would also
Oil and Petroleum
need control of hydro power to further their interests. Almost everyone in Ontario felt that if the province were to develop, it would have to own its electrical resources. History has proven them wise. Ontario probably could not have developed in the way it has without public ownership of its energy, and today it is in the forefront in the development of energy, nuclear and electrical, and has some of the cheapest energy rates in the world. It was a fortunate decision that electricity was taken under public ownership in Ontario, and these arguments are as relevant today as they were in Adam Beck's time.
In putting forward these arguments I am somewhat encouraged by the receptivity of this government. The minister has found himself in difficult circumstances at times, but he has done a good job.


Some hon. Members:: Hear, hear!


Max Saltsman: He had to learn fast, and he did. We found ourselves in an energy crisis last year, without an energy policy. Of course, we do not have much of an energy policy now, but we had nothing at all when the crisis hit. We can laugh now about the Minister of Supply and Services paying an outrageous sum for heating oil, but we would have cried had we run short of it. We would have said he should have bought it no matter what the price. It is regrettable, perhaps, that his business judgment was not sounder, but the important thing is that we came through an international energy crisis almost unscathed. It was done because of government intervention: the government was prepared to move in. It was done without legislation: there was no legislative authority for what the government did. This is an indication of the authority of government in our society. If a government is determined to act, it can say it expects the private sector to behave in a certain way because it is going to introduce legislation to make it so. It is quite clear. The private sector has no choice but to respond.
This situation is very instructive because the private sector concerned was almost entirely foreign-owned. We were afraid foreign ownership would make it impossible for people in this country to respond in an emergency. The message came through loud and clear. If governments in our society choose to exercise the authority given to them by the people of this country, they have infinitely more power than any foreign-owned corporation or privately-held organization. We have seen foreign corporations virtually run this country. That was not because intrinsically they had the power to behave in that way, but because our government refused to intervene. Because of the abstention of the government, these foreign corporations were able to make their will felt.
I know I speak for my colleagues when I say we were pleased that the government was prepared to intervene. One reason the government acted was the particular electoral arrangement at that time: I am talking about a minority government. For a long time there was a great spirit of co-operation between our group and the government, in terms of energy policy. People might say that at this point the government has a majority and no longer has to listen to the NDP. It probably does not. However, I

November 4, 1974
Oil and Petroleum
am confident that that kind of co-operation and response by the government to a national emergency made an impact on the government and the people in the Liberal Party. I notice with a degree of pleasure that even though Canada does not have a minority government now and we are not in a position to twist arms, some of the arguments we put forward last year have been put into effect. The government saw they were necessary. I am optimistic that we will continue to have a forward-looking policy and willingness by the government to deal with new problems as they arise.
I was interested in watching members on the government benches when my former leader spoke, the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas). Tremendous attention was paid to what he said. On many occasions the applause from the opposite side was a genuine expression of agreement with what he was saying. Therefore, I think that arguments once started, or paths once cleared, tend to have a way of being continued. The government was very reluctant to intervene in the situation to which I have referred. They have always been reluctant to do that. However, they now understand that it was absolutely necessary. The people of this country heartily approved of that kind of intervention, and I hope it will continue. I hope the government will listen to these arguments regarding public ownership, not in a narrow, ideological framework but as something that is necessary and useful for the development of future policy for this country.
At the present time, Interprovincial Pipe Line is dragging its feet in building the line to Montreal. They say they need guarantees. They do not know what the throughput, cost or price will be, and therefore are not prepared to do anything without guarantees. If it is necessary to guarantee rates, returns and everything else, why do we need Interprovincial Pipe Line? We might as well build the pipeline ourselves. We will probably be asked to guarantee their bonds. In fact, we did guarantee the bonds and the company operated with government guarantees. Why not build this section of the line under public ownership? I do not think a pipeline is the greatest thing to own publicly, but when you get to the point where you have to make all these concessions, you do not know how accurate company's figures are and you must ensure that the figures are not inadvertently exaggerated, you might as well go ahead and build the pipeline yourself.
It is well within the capacity of the Canadian government's resources-that is, the capacity of the Canadian public-to build this pipeline instead of delaying it. Let us not be lulled into a false sense of security. The tension seems to be off and the Middle East seems to have settled down. But it will boil up again. Are we to be subjected to this kind of pressure without being ready for it? I know we accommodated ourselves last time, but we should be much better off now than we were then. Last time we had to operate on an ad hoc basis because the government had not planned; it did not listen to the various proposals this party had put forward for years with regard to a pipeline to Montreal. We should proceed immediately to build a pipeline under public ownership, instead of trying to figure out what kind of subsidy or conditions the company wants. If we must go to a great deal of trouble, there does

not seem to be much point in having private enterprise build the pipeline.
We had considerable argument in committee about the Telesat Corporation. At the time the corporation was proposed, it was a troika arrangement: the idea was that the communications industry would own one-third, the government one-third, and one-third would be sold to the public. We put forward the same arguments. We said the rates would be regulated and the corporation could not lose money. If it appeared they were going to lose money, the government would adjust the rates. Why bring in the private investor or the telecommunications people into what was essentially a government idea? What is the point, when you are going to guarantee the corporation a return? Despite Telesat saying it was waiting until it got going a little before bringing in the private investor, it has not done so because they do not need the private investor. The private investor would be a hindrance to the corporation. Even though speeches are made about Telesat and lip service is paid to the proposition that at some point shares will be put on the market, those shares will never go on the market because it is not necessary. Telesat is an enormously successful corporation. They have made very good arrangements for the leasing of their communications channels and the public investor is not required.
The Canada Development Corporation is another example. We in this party argued for such a corporation. We saw the Canada Development Corporation as an instrument of national development, not as a way of offering the five-buck investor an extra place to invest his five bucks. We have a wonderful instruments for private investment. There are Canada Savings Bonds. Why do we need to create equity ownership in something as important as the Canada Development Corporation when the country needs a development corporation? The investors are satisfied with Canada Savings Bonds. The Canada Development Corporation is doing rather well. We are not happy that it is taking over profitable government corporations and then threatening to take them out of public control and put them into private hands by opening up their investment portfolios, but to this point they have managed very well without the private investor. In fact, they have probably done much better without him.
While the CDC says it is waiting until its portfolio fattens a little before putting its shares on the market, I suspect the same thing will happen as happened with Telesat. Private shares will never be issued simply because the CDC does not need the five-buck investor. Not only that, he would get in the way. There are already problems in the Canada Development Corporation, one of which is shameful for a public corporation. It took over Connaught Laboratories, which manufacture insulin. Because its sole term of reference is to make money, the corporation is still looking toward the day when it will put out investment certificates or provide an opportunity for the private investor. It is taking something which is essential and which should have been produced at cost, and trying to make a buck out of it.
Surely they can provide insulin at cost? They are making enough money from other investments to enable them to absorb the cost of manufacturing insulin. It was
November 4, 1974

important that CDC take over Connaught Laboratories because they had nowhere else to go. But it is also important that they recognize the social usefulness of providing insulin without making a profit on it. As long as that element is there, they must think in terms of the future- how things will look on the stock market. That is the problem. Where you do important work involving the future or public morality, to think in terms of profit is not same.
Profit has a useful purpose in unimportant things. If somebody wants to make a profit on shoes, good luck to them. You don't have to buy shoes to that extent. You can buy one kind, you can buy another kind; you can buy a cheaper one, or you can buy a more expensive one. You do not need to have the shoe industry under public ownership. There is no need for extensive regulation in such areas. But when it comes to programs such as medical care-which of course is almost entirely a public responsibility, as it should be-you recognize it, and now we have to recognize that a resource as vital as energy cannot be left to the shenanigans of the profit motive.
As to people in the field, I grant they have the best intentions in the world. I have met many people in the gas and oil industry and they seem like decent fellows I am not quarrelling with them for trying to act against the public interest because, I am sure many of them think their buccaneering is very much in the public interest and that the public benefits enormously from their buying and selling, and drilling, getting out and getting in, and all the rest of it. The point is, they are not in a position to act for the public, given the kind of attitude that they have and the nature of their industry, even if they wanted to.
What is the point of competition in energy? I know it is very convenient to have electricity going down your street, to have gas going down your street, to have oil being delivered to your house. It is very convenient to have all these modes of energy. But that is for a society that does not think there will be any shortage of energy tomorrow. To waste all that capital, to waste all those resources, to duplicate facilities-that is yesterday's society with its philosophy of sell, sell. Hydro advertises that it will give you a better deal than gas. That is competition. This brings me to the point I am trying to make.
Competition, by its very nature, by its very huckstering, is bound to be wasteful. We cannot afford to waste energy. The most compelling argument in favour of public ownership of energy is that it will eliminate duplication and waste. For the first time we would be able to plan energy. Let me cite one example of what happens when you do not plan. We think of bringing a gas line down from the Arctic. So what is the argument? The argument is that we will have to build so large a line that we will not be able to use all the gas that comes through it; therefore, let us take the three-quarters surplus in that line and export it until we can absorb its entire output.


An hon. Member:: Rubbish.


Max Saltsman: Well, that is the proposal of the Arctic Gas Study group. That is really what they are saying.


Mr. Andre:: No.
Oil and Petroleum


Marcel Joseph Aimé Lambert: That is wrong. We do not have enough gas up there.
Mb. Saltsman: Perhaps I am not using their jargon. They are saying, "We cannot build a line for our own use; we will have to export some of the gas." They do not say, "We don't have enough gas; take somebody else's." Most of it has to go to the United States until we are ready to use it.


Marcel Joseph Aimé Lambert: What about Prudhoe Bay?


Thomas Clement (Tommy) Douglas: They will not get any gas out of Prudhoe Bay for the first three years, and you know it.


Max Saltsman: There is not enough Prudhoe Bay gas going in there. They want to export more.


Harvie Andre: No, they don't.


Max Saltsman: Yes, they do.


Marcel Joseph Aimé Lambert: You have a confirmed easterner's knowledge of the west, which is zilch.


Max Saltsman: There will be opportunities. The point is, you cannot plan. If you know you must build a line of that kind and it is expensive, then you start co-ordinating your heating requirements and your planning requirements to take into account gas that will be coming down at a certain point in time, instead of building areas where you have this kind of heating, that kind of heating and the other kind. My colleague over there may say, "That's regulation; you are controlling people. We must have electricity. We must have gas rather than oil." However, we cannot live in a world where we squander these kind of resources. We will have to regulate the use of energy. We may, in fact, have to penalize the use of energy. This is another problem. Instead of pricing gas or oil cheaply, as a matter of public policy all types of energy may have to rise in price.


Harvie Andre: Yes.


Max Saltsman: You approve of that. The problem of making prices rise, even if you come to the conclusion that you must use price as a mechanism for rationing, is that when you do so the benefit does not go to the public; it goes to some private company. Therefore you are frustrated in developing an intelligent policy, because while it may be desirable to tighten consumption, it is only desirable to price high if the benefit of that high pricing goes back to the public so it can be used for other things.


Harvie Andre: What about taxes?


Marcel Joseph Aimé Lambert: Governments already get 80 per cent of a barrel of oil.


Max Saltsman: There are ways of dealing with this problem without going to public ownership. One of my distinguished friends on the right has suggested we could tax. We tried to tax and we failed. What happened when we tried to tax? The government of Alberta sent people down to the committee considering the Carter report on

November 4, 1974
Oil and Petroleum
taxation and said, "Don't tax the resource industries." A lot of pressure was put on the government.


Harvie Andre: Get your facts right.


Max Saltsman: Read the minutes and you will see that the government of Alberta put pressure on the federal government not to tax. The point is, these resource industries were let off the hook. The recommendations of the Carter commission were never enacted in that area. Had we been able to devise an intelligent tax system under which those industries were taxed on the same basis as manufacturing industries, we might have avoided much of the confrontation that now exists among the industry, the federal government and the provincial governments. But we failed miserably to achieve our goals through taxation. While those goals can sometimes be achieved through taxation, this is not a great example of taxation success.
The problem of scrutinizing and verifying the arguments made on both sides of the taxation question is so great that it is really pointless. You can argue that we can regulate. After all, why place oil and gas under public ownership? Why don't we do what we do with Bell Canada and regulate these industries? It works to some extent with Bell Canada. By and large, I do not know that the public would benefit substantially from public ownership of Bell Canada. As I say, I don't know and that is really the problem.
You get to the stage, when you regulate an industry, at which the cost of scrutinizing the industry, the cost of policing it, and its cost in terms of making that policing more difficult-like the CPR with its regressive analyses-becomes so great that at some point you throw your hands up and say, "We're just playing games with each other instead of getting on with the job, and it might as well come under public ownership." It is this sort of cops and robbers game, going back and forth with each other, that eventually leads to the need for public ownership. Regulation of Bell Canada is difficult enough, but imagine how much tougher it would be to regulate the oil and gas industry and to ascertain future plans.
The oil and gas industry has given us misleading information from Day One. When it suited its purposes to export, the industry gave us glowing figures of our oil and gas reserves. According to them, we have enough to last us practically for the next two million years. Then when they wanted a higher price, all of a sudden the story was different; we were told there was little oil and gas left and the industry required more money to go into new fields, otherwise in 15 or 20 years we would be short. It is inconceivable that something as important as energy is left to this kind of game playing.
We will have to spend $50 billion over the next ten years, perhaps more, to develop new forms of energy. Where do we start? If we start with the James Bay project, the tar sands project, building pipelines, developing nuclear energy, we shall need tremendous sums of money. We must approach the matter in a rational and intelligent way by allocating the resources at our disposal in the most effective manner. This means that we cannot finance our energy needs from the market system but must do so

through public saving and public investment. To do it in any other way would be an absolute waste.
I can give the House a great example of waste which, fortunately, turned out to be not so wasteful. This sometimes happens when you talk about waste, so I must be rather careful. In this instance, the result was more by accident than design. A lot of investment went into Alberta at a time when there was no need for it and no markets for oil. We operated our wells at something like 35 per cent capacity, tying up billions of dollars in equipment which had to yield a higher return. I see you are signalling, Mr. Speaker, so let me conclude by saying that I have advanced but a few of the many good arguments for our stopping this chaotic approach to private investment in the energy field and moving to a system of conservation and public works.


Mr.   J.-J. Blais@Nipissing: Mr. Speaker, I am very happy to participate in this debate because, as several previous speakers have indicated, the topic under study is one of the most important facing the national as well as the international communities. One need only listen to the hon. member for Waterloo-Cambridge (Mr. Saltsman), who speaks of it in a nationalistic vein, to become aware of it. Some of the members opposite covered every aspect of the energy problem to prive its importance.
To begin with, I should like to criticize the comments of the hon. member for Saint-Hyacinthe (Mr. Wagner) who said-indeed that was his main argument-of all the opposition members from Alberta that his only objection to the bill is the fact that it gives rise to a confrontation between the rights of the provinces and those of the federal government. He indicated that the government members should protect the provincial rights. In fact, Mr. Speaker, we are federal members of parliament.
As far as the rights of the province of Quebec are concerned, I point out that they are directly protected by the provisions of this bill. Of course, the hon. member for Saint-Hyacinthe has not seen anything, since the province of Quebec is paying $6.50 a barrel for its oil, the international price being $11.65. They save thus $5.15 a barrel on the oil imported in Montreal, because of the measures we are trying to implement and to apply efficiently, and which are contained in the bill under study.
Indeed, Mr. Speaker, it is not at all a matter of taking powers from any province. The federal government has a national responsibility and he sees to carry it out with this bill, namely to ensure that the needs of the consumers in eastern Canada are met with western oil.
Mr. Speaker, since the federal-provincial agreement was entered into on March 31, we have in Canada a standard price for oil from coast to coast, taking into account the transportation costs. It is obvious that the province is the first to benefit from it. Otherwise, Mr. Speaker, the province of Quebec would have to pay $11.65 a barrel, while Ontario could have indulged in the luxury of paying less than $6 a barrel. The government has chosen to take its role seriously in spite of the position taken by the member for Saint-Hyacinthe, who asserts the rights of the province of Quebec and the other provinces. If we listened to him
November 4, 1974

and to his colleagues, we would give up our own responsibilities.

Indeed, Mr. Speaker, this bill is an extremely important one. I would have thought it would receive quick passage since we studied it for nearly a month last April.


An hon. Member:: That was befor ~ lV>e budget.


Mr. Blais:: Yes, we studied the bill before the budget. I should like to take exception to what the hon. member for Peace River (Mr. Baldwin) said on second reading of the bill, then called Bill C-18. He said: "We will delay the passage of this legislation. We will study it with a fine toothed comb, and when we get it before the committee we will call witnesses galore and try and delay it as best we can". That is exactly what they did. The reason they did that is the same reason they are presently advancing, and the one the attorney general of Alberta gave when he appeared as a witness before the committee, namely, that it is a direct attack on provincial rights.
When Mr. Leitch appeared before the committee, he evidently had not bothered to read the bill beforehand, because if he had read it he would have seen that he was incorrect in his interpretation of its provisions. I suggest that no one has attacked the agreement which was reached on March 31; even the most recalcitrant members from Alberta have agreed it is essential for the stability of Canada's industrial complex and our economy as a whole. It is essential that there be some sort of equality regarding the cost of energy in this country; there is no doubt about that.
I should like to read what Mr. Leitch said when he appeared before the committee, as recorded at page 7 of committee report No. 15 of the Standing Committee on National Resources and Public Works. I am sure hon. members have read what he said. The hon. member for Calgary North (Mr. Woolliams) indicated that the principle of this bill had been negated by the agreement of March 31, and he repeated exactly what Mr. Leitch had to say. Mr. Leitch said;
Mr. Chairman, I wish to conclude by commenting on part III, the part to which our most fundamental objections are directed.
The hon. member for Calgary North is evidently in error. Throughout his speech he referred to part III as being under attack, but according to Bill C-32 it is part II. So he was referring to part III of Bill C-18.
Far from embodying a term of the first ministers' agreement it stands as a direct negation of the principles upon which that agreement was based.
It permits the executive council to terminate an existing agreement between a producer province and the federal government or to decline to negotiate a renewal agreement and to impose by unilateral action maximum prices on a natural resource owned by a province.
That is absolute balderdash. That is not what the section says at all. If you will permit me, Mr. Speaker, I will read what the section does say, because it has been referred to. It provides:
Where an agreement is entered into with a producer province under section 22, the governor in council may, by regulation, establish maximum prices for the various qualities and kinds of crude oil to which
Oil and. Petroleum
this part applies that are produced, extracted or recovered in that province.
It speaks of an agreement reached under section 22. It provides for the entering into of agreements, and it also provides power to act if an agreement is not entered into or if it is unilaterally reneged by one of the producing provinces: it provides the federal government with the power to impose a price. Would any member of this House argue that the federal government does not have power over interprovincial or, indeed, international trade?
Would anyone argue that any individual province in this federation has power to impose negative prices, or has power to impose a higher price or a two-price system in respect of a commodity which it exports? Is there anyone who would say that as far as interprovincial trade is concerned, the federal government does not have the obligation to ensure that everyone, in every part of this country, has a fair shake and fair access to a commodity produced within this nation? Anyone who would deny that assertion would be attacking the very principles of this confederation.
We are all Canadians. No one can tell me that in northern Ontario the consumer does not have the right to receive natural gas because the province of Alberta, through Pan-Alberta, does not want to send its gas to northern Ontario. If Pan-Alberta has the right to do that, then it goes directly against the principles of confederation and the unity of this great country.
That is exactly the position that is being taken by members of the opposition. They are suggesting that they are doing this at great and tremendous sacrifice on the part of Alberta and Saskatchewan because they are subsidizing the rest of this country. I have some figures here of considerable interest which I should like to draw to the attention of the House. In 1972, before we started to have difficulty and at a time when royalties in the province of Alberta were 16 per cent of the price of oil at the well head, the total revenue for Saskatchewan and Alberta was $270,900,000, or roughly 44 cents per barrel. In 1973, when an export charge was levied and there was some federal interference-I will agree with that-the rate went up from 16 per cent to 22 per cent. Premier Lougheed said that was as far as he would go in respect of royalties, and the amount went up to $480,600,000.
In 1974, when this difficulty really occurred and the federal government interfered with the rights of the province of Alberta, the amount to those poor Albertans went up to $1,500 million. That does not include the export charge payable by the federal government of an extra $200 million. I just do not understand how they can say they are subsidizing the rest of the country when we are talking in terms of royalties amounting to $l3/i billion. Let hon. members on the other side get up and say those figures are wrong.


An hon. Member:: What is your source?


Jean-Jacques Blais: My source is "Oil Week".


An hon. Member:: What issue?


Jean-Jacques Blais: It is the October issue. Apparently the hon. member has not read it. It seems to me like cheap potato

November 4, 1974
Oil and Petroleum
chips for hon. members to say that the province of Alberta is ready unilaterally to veto the agreement-because that is what they are saying. First of all, there was an agreement on March 31 to which they did not object. Hon. members suggest that it was all right for the federal and provincial governments to reach that particular agreement. But now they are objecting to it because, as they say, they did not agree that there ought to be power on the part of any government unilaterally to negate any particular agreement.
I fail to understand this and I object to it because, in fact, what is happening is that as far as natural gas is concerned, Northern and Central has a pipeline which serves that entire area. The area is being supplied now by Northern and Central. Gas is now being circulated all through southern Ontario and Quebec, even in Saint-Hya-cinthe from which the hon. member comes. The company has indicated that it will be impossible to supply additional amounts of gas in the future. In my area there is strong dependence on natural gas for industrial consumption, but apparently they cannot anticipate receiving any increase in supply. I refer to a letter addressed to the Norfolk Hospital Association of Simcoe, Ontario, from the vicepresident of marketing and sales of Union Gas Limited. It is dated August 6, 1974, and reads in part:
Since late 1970 Union Gas Limited has been negotiating with its principal supplier, TransCanada Pipe Lines Limited, for additional volumes of natural gas from Alberta to meet the expanding requirements of its market area in southwestern Ontario. While additional contracts have been obtained, the volumes involved fall considerably short of satisfying the total potential demand in Union's franchise territory. Currently, TransCanada advises us that not only is it unable to provide additional supplies for expansion, but it is experiencing difficulty in contracting for sufficient new reserves in western Canada to sustain deliveries at present contract levels for any significant time into the future, and there is a possibility of curtailment in deliveries to its markets in one to two years' time.
Later in the letter we find this paragraph:
Maintaining service at present levels to markets east of Alberta will cause shortages unless significant new sources from western Canada are brought on stream and made available to the principal consuming areas of the country.
This letter concludes by stating in the last paragraph:
We regret very much having to give you this preliminary notification of a pending gas shortage. In view of the supply situation outlined above, we would ask you to advise us as to the possible effects on your planning and operations that any termination or curtailment of natural gas supply would have on your operations.
There is a shortage, according to TransCanada Pipe Lines. But let me read from an article which appeared in the Globe and Mail of Saturday, November 2, under the headline "Pan-Alberta, TCP dispute jeopardizes gas for Ontario". It reads in part:
Pan-Alberta Gas Ltd. of Calgary has decided not to sell its natural gas supplies to TransCanada Pipe Lines Ltd. of Toronto, which supplies fuel to the three distributing utilities in Ontario.
That would include Northern and Central Gas Company. Gas will not be distributed to my area in any additional amounts. Pan-Alberta is not private enterprise, in the Tory or Conservative sense of the word, but it is a state capitalist in the Conservative or Tory sense of the word. My area, as well as the whole of Ontario, is being directly threatened by Pan-Alberta.


Mr. Schumacher:: I rise on a point of order, Mr. Speaker. Would the hon. member permit a question?


Jean-Jacques Blais: Mr. Speaker, I should like to conclude my remarks by saying that so far as I am concerned, the reason there is a wrangle in respect of this bill is the price. Pan-Alberta is concerned because if TransCanada Pipe Lines gets this extra volume, it will not bring up the price at the well head. Pursuant to an agreement to be reached between Alberta and the federal government-as has been the case in respect of oil

the price of that gas will effectively be brought up with the approval of all parties concerned, the producers and the consumers.
It is a coincidence, undoubtedly, that this particular article was published at the time this bill was under study. However, it directly indicates the need for the legislation which I trust, notwithstanding the effective opposition of the opposition parties, will be passed promptly and sent to the committees for study and approval. Then it will return to this House, where it will receive passage so that all its measures might be effected within the shortest possible period for the benefit of Canadians.


Stanley Stanford Schumacher: Mr. Speaker, since the hon. member has not used up all his time, I wonder whether he would permit a question. I should like to ask the hon. member why Union Gas and Northern and Central Gas will not negotiate with Pan-Alberta. Why do they insist on going through the TransCanada Pipe Lines' route when it is possible for them to negotiate with TransCanada and have TransCanada deliver as a common carrier, as Quebec has done?


Jean-Jacques Blais: They are negotiating. I have not been briefed concerning their negotiations. Perhaps the hon. member has some additional information which he could convey to the House concerning why they do not accept TransCanada Pipe Lines' offer. At any rate, for 18 years TransCanada Pipe Lines has established its markets through its distribution companies. At a time when there is bound to be a shortage in gas reserves in the near future, the province of Alberta should not use that potential shortage as a lever for its own private interests, to the detriment of the consumers in eastern Canada. That is a principle that this bill should recognize.


Harvie Andre: First, Mr. Speaker, I feel obliged to correct some of the inaccuracies of the hon. member for Nipissing (Mr. Blais). In respect of PanAlberta, which the hon. member claimed was provincially-owned, may I point out that 61 per cent of the shareholders of this company are residents of Ontario. With regard to the question of Union Gas being unable to supply its regular customers, the hon. member read from a letter that Union Gas sent, I believe, to a hospital association, in which it was said that they were unable to sustain deliveries at current contract levels.
If this means contract levels with regard to the price, small wonder; because the Minister of Energy, Mines and Resources (Mr. Macdonald) was moved to comment that natural gas was drastically underpriced and that if, in fact, it were to remain at this particular price level we in Canada would be wasting this fuel, utilizing it inefficient-

ly, and therefore in the not too distant future we would face severe shortages.


Donald Stovel Macdonald: But I recommended price phasing as well.


Harvie Andre: The minister indicates he recommended price phasing. A year and a half ago, the province of Alberta indicated it wanted to see this brought about, but received no co-operation. Even at this late date I would invite the minister to consult the companies which own the reserves, and the province which administers them, to see if in fact they can work out an agreement for price phasing up to a realistic value without using the threat of this legislation.
The question of consultation and discussion in respect of energy, oil and gas supplies, with the provinces unfortunately is not a new issue. In fact, one of the few accurate statements made by the hon. member for Waterloo-Cam-bridge (Mr. Saltsman) was at the end of his speech when he said we must stop this chaotic approach to energy policy.
This reminds me of when I participated in the debate on second reading of Bill C-18 during the last parliament. Bill C-18 was the predecessor of this bill. I prefaced my remarks in that debate with the comment that it was with a sigh of relief I was rising to participate because we were finally seeing the beginning of the end of the federal-provincial confrontation on energy which has been going on for about a year and a half. Bill C-18 was accepted by me as the start of the process. But little did I know how wrong and how gullible I was to accept the word of the minister and the government in this respect. Let me quote from the remarks of the Minister of Energy, Mines and Resources as recorded at page 1235 of Hansard for April 8, 1974, when he was speaking of the March 27 first ministers' meeting at 24 Sussex Street which produced the agreement which lead to Bill C-18. The minister said:
I would like to join with the Prime Minister in asserting that federalism triumphed in reaching a solution to a problem which was at its heart a matter of relative equities and sharing within our country.
That did not prevent the government adding a twister to the legislation which arose from this agreement, namely, that if the government unilaterally decides that the agreement is no longer applicable for one reason or another, and if in future they are not able to work out an agreement with regard to the price of crude oil, then after July 1, 1975, the federal government can unilaterally impose an agreement without recourse to the provinces. That certainly was not part of the agreement worked out at the luncheon on March 27. It is at least of questionable constitutionality. Even more laughable-it would be more laughable if it were not so sickeningly facetious-are the minister's remarks as reported at page 1234 of Hansard for April 8,1974, when he said:
-government policy has been to articulate three principles: First, that the price of Canadian crude oil should move upward to encourage exploration and development in Canada and thereby ensure further availability of our own resources, which will necessarily be more costly because they are both physically and technically less accessible, and also to ensure a continuing capacity for self-sufficiency.
Oil and Petroleum
Just one month later the Minister of Finance (Mr. Turner) introduced the budget and on May 8 the government confiscated any additional revenue that might have been available to help in the hunt for oil and gas. So how can you believe this minister? On April 8 he says that the first and foremost principle of the government's national oil policy is that there shall be sufficient revenues to finance the hunt for oil and gas which Canadians will need, and one month later his colleague confiscates those revenues. As was stated by Mr. Fred Kennedy writing in the Calgary Albertan of Saturday, November 2-I am paraphrasing here-anyone who accepts a commitment from this minister that is not in writing and witnessed, deserves to be duped.


An hon. Member:: Right on.


Harvie Andre: Let us look at the history of crude oil pricing in Canada, which goes back a long way. However, I will not go all the way back; I will go back only to January 7, 1973, when there was an exchange of correspondence between Mr. Getty, minister of intergovernmental affairs of the Alberta government, and the federal Minister of Energy, Mines and Resources in which the latter pledged that there would be the fullest consultation before the federal government would implement a system of crude oil export controls. One month later, with no consultation, with not so much as a "by your leave," the federal government unilaterally imposed export crude oil controls. That was the first warning, in recent times at least, that the government of Alberta in future had better get more iron-clad guarantees rather than just a letter, even though it was signed by the minister.
Then there was the energy policy that was brought down in July of 1973, and again I commend the officials of the minister's department for putting together an excellent document containing excellent advice. I think on page 9 of that document it is stated that no national oil policy can be contemplated without the fullest intergovernmental co-operation and discussion. It also said, I believe on page 14 of the document, that it did not appear practical to build a pipeline from Sarnia to Montreal to carry western crude to Montreal. On September 4, just two months later, without any consultation at all, the government introduced a new national oil policy freezing the price of western crude at $4 a barrel and committing the government to a pipeline to the Montreal market.


Lincoln MacCauley Alexander: Shame!


Harvie Andre: However, when they froze the price of crude oil, the National Energy Board discovered that they would not be permitted to licence exports as a result of the National Energy Board Act. So, very quickly, the government invented the export tax. However, the Minister of Energy, Mines and Resources repeatedly assured the province of Alberta and the Canadian public-in this House, on more than one occasion-that this was a temporary measure that would last only until January 31, 1974. The last such assurance was made on December 5, 1973. On December 6, the Prime Minister (Mr. Trudeau) said, in spite of all assurances, that the price freeze would remain intact until the end of the heating season.
1022

November 4, 1974
Oil and Petroleum
I think that was the fourth or fifth broken commitment. There was the first ministers' meeting of January 22 and 23 in which the minister proposed a hairy scheme for sharing export tax revenues. That was laughed at. As a result of that conference, which produced nothing, there was a meeting on March 27 at 24 Sussex Drive out of which came the agreement for one uniform price for crude oil across Canada, based on Montreal with transportation differences for the rest of the country, from which came Bill C-18. Again I greeted that with a sigh of relief, except for the fact that it contained the twister that the federal government would still retain a cudgel with which they could beat down the provincial governments if they found it necessary. But then, just one month after Bill C-18, along came the budget which totally wiped out any agreement, any good will, any feeling that we are now, finally, working together as a nation for the national good.


Lincoln MacCauley Alexander: The minister isn't even listening.


Steve Eugene Paproski: The minister does not care.


Harvie Andre: It is a sad history of broken promises and commitments. Small wonder that some westerners state that commitments from this minister should be obtained in writing and be witnessed. I might add that they should be bonded, as well. Not only do they freely break commitments and promises; they cannot even be counted upon to obey the law. For example, let me quote from the Mineral Transfer Act, 1930, as follows:
-the interest of the Crown in all Crown lands, mines, minerals (precious and base) and royalties derived therefrom within the province, and all sums due or payable for such lands, mines, minerals or royalties, shall, from and after the coming into force of this agreement and subject as therein otherwise provided, belong to the province-
It could not be more explicit: the royalties belong to the province. Then how is it that the Minister of Finance can introduce a budget saying that companies will treat as income for taxation purposes these royalties which the Mineral Transfer Act states belong to the province? I might add that there is another section of the BNA Act, section 125, which provides:
No lands or property belonging to Canada or any province shall be liable to taxation.
The hon. member for Nipissing has indicated that the federal government has jurisdiction over trade and commerce. There is no argument about that. But it is also very clear that natural resources belong to the province; and there should not be any argument about that. To what extent can one level of government, in exercising its rights under the law, impinge on the rights of another level of government? Surely common sense would indicate that the proposals contained in this legislation and those which have been put forward by the government totally contradict the law in respect of the provinces having the right of ownership over these natural resources.
Does ownership simply mean that one has title, but none of the privileges? Is an owner prevented from utilizing the lands or minerals that he owns to his own best benefit? If that is the case, what is the use of ownership if in fact some other authority, in exercising what it considers its legal right, can restrict you from exercising any of the normal prerogatives of ownership? If that were the case,

ownership would be meaningless. Surely we have not come to that in this country.
In total, the performance of this minister, of his colleague the Minister of Finance, and of the Prime Minister in respect of our oil position, has been incredibly inept and basically dishonest. Small wonder that one hears so much talk in western Canada of alienation and separation. I do not want to dwell on the subject, but it would be a great tragedy if in their arrogance the members of this government, the Prime Minister, the Minister of Energy, Mines and Resources, and the Minister of Finance, underestimated the depth of feeling that exists. I and all my colleagues here and in the provincial government of Alberta are Canadians first and foremost.


Donald Stovel Macdonald: "But".


Harvie Andre: But, Mr. Speaker, there is a limit to how often one can take the abuse, the lies, the broken promises without some form of reaction, and that limit is now being reached. We want the federal government to demonstrate sincere concern for Alberta and for western Canada, and to show that their contribution to confederation is held in as high esteem as that of other parts of the country. We think that the problems of Alberta, Saskatchewan, Manitoba and British Columbia have not been given the attention they merit. There has been no consideration of the transportation inequities which have been raised time and time again in this House, and there has been no consideration of the effect of various other policies on the development of western Canada.
The hon. member for Nipissing quoted figures to indicate the wealth of Alberta. Perhaps he should look at some figures which show that in 1973 the average income of Albertans was $800 a year less than that of citizens of central Canada. There is a clear case of long-time neglect of the west, Mr. Speaker. The price of oil and gas has recently given western Canadians an opportunity to alter some of the traditional trends and to diversify their economy, develop secondary industry, provide a greater variety of jobs and maximize the benefits of gas and oil production.
We think those goals are consistent with national goals and that it is important to have strong regions. We believe a diversified economy is good for the country, yet everything we see coming from this minister and the Minister of Finance seems to work against that. It is to be hoped the new budget will put an end to this government's opposition and will bring more co-operation rather than confrontation.
Part I of this bill would give legislative sanction to history. In effect, parliament is being asked to put the stamp of approval on history. This is a misuse of its powers. I would implore the government to get away from this practice of legislating retroactively. Part II of the bill deals with the federal-provincial agreement. The hon. member for Nipissing quoted the testimony of the attorney general of Alberta when he appeared before the committee which studied the predecessor of this bill. The attorney general said no arrangement was worked out at the luncheon meeting which allowed the federal govern-
November 4, 1974

ment unilaterally to discard the agreement if it chose and unilaterally to impose its own price regime. Such an agreement was not worked out at that meeting, he said. If that is not a breach of intent, or if it is co-operative federalism, Liberal style, let us put an end to it.


Donald Stovel Macdonald: That was specifically discussed.


Robert Lorne Stanfield: It was not agreed to.


Donald Stovel Macdonald: It was specifically
discussed.


Robert Lorne Stanfield: What kind of sophistry is that?


Harvie Andre: The minister says it was discussed. What kind of agreement was this?


Donald Stovel Macdonald: That is why you were a real failure. You are the loser.


Robert Lorne Stanfield: I am a loser in many respects.


Harvie Andre: The minister has indicated that we are the losers. There you have it, Mr. Speaker. In a minority government I can understand a minister of the Crown sometimes getting his political objectives mixed with the responsibility of his office, and therefore taking decisions that are politically expedient and not in the best interests of the country. It is unforgivable, however, for a minister in a majority government to be thinking along those lines. When is the minister going to start being responsible for the energy produced in this country? When is the minister going to start worrying about this co-operative federalism that his leader is always talking about on the hustings? What an incompetent minister! He is there for no other reason than he was the first English member of parliament to support Pierre Trudeau for the Liberal leadership.


Some hon. Members:: Hear, hear!


Harvie Andre: Mr. Speaker, that provision was not agreed upon at the first ministers' meeting. It is contrary to any spirit of co-operative federalism. It may well be contrary to the constitution, as indicated by the attorney general of Alberta. It certainly is damaging to national unity. That cannot be understated. Part III of the bill deals with the question of gas prices. Despite all the verbal and written commitments to have the fullest consultation before new initiatives are taken on an oil policy or on an energy policy, the minister-without so much as "by your-leave"-brings forward this provision to control the price of natural gas.


Donald Stovel Macdonald: Mr. Speaker, may I ask the hon. gentleman a question?


Harvie Andre: Certainly.


Donald Stovel Macdonald: Are Alberta ministers asserting that there was no consultation about the federal measure with regard to gas prices?


Harvie Andre: Mr. Speaker, there was not time to work out an agreement with the Alberta government. There was an
Crown Corporations
indication of intent from the federal government; then it appeared. Is that consultation?


Donald Stovel Macdonald: Yes. Did we not consult-


Some hon. Members:: Oh, oh!


Harvie Andre: That is consultation? I will argue with the minister about gas. That is something he understands- consultation Macdonald style. Why is the price of gas going to be controlled, Mr. Speaker? I should like to get around to that question later, but may I call it five o'clock?



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: Order please. 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 Grenville-Carleton (Mr. Baker)-Urban affairs-Request for statement of government policy in respect of green spaces in cities; the hon. member for Ottawa-Vanier (Mr. Gauthier)-Housing-Suggested measures by Central Mortgage and Housing Corporation to control irregularities by other agencies; the hon. member for Rocky Mountain (Mr. Clark) - Appointment of Michael Pitfield-Possible change in criteria for making appointments.

It being five o'clock, the House will now proceed to the consideration of private members' business as listed on today's order paper, namely, notices of motions and public bills.



PRIVATE MEMBERS' MOTIONS


Mr. Andre Fortin (Lotbiniere) moved:: That, in the opinion of this House, a special committee of inquiry on Crown corporations exercising financial, commercial or industrial activities be established to study the various Acts establishing such Crown corporations, the Crown Corporations Act, sections 76 to 88 of the Financial Administration Act, and all other laws concerning Crown corporations and to recommend to the House the adoption of a law regarding federal public enterprises; the committee should also study the following subjects without restriction (a) the legal rules pertaining to the employees of such corporations (b) their financial structure (c) the way in which they are financed (d) government control over said corporations (e) fiscal regulations (municipal, school, provincial and federal taxes (/) the status of the administrators (g) the privileges of such corporations resulting from their being "commis-
2 83 05-6 5 Vi

November 4, 1974
Crown Corporations
sioned by Her Majesty" (h) the status of the subsidiaries of these enterprises (i) their purchasing policy (j) the problem of auditing by the Auditor General of Canada or by private auditors (k) the appropriateness of State intervention in the economic field in the form of enterprises; and all other matters concerned. (By unanimous consent was allowed to stand and retain its position).
Mr. Speaker, I am pleased to have the opportunity to introduce this motion. I want to apologize first for my voice which mingled with that of demonstrators during the weekend. This does not mean that we must approve them, but we have to put up with them anyway.
I attach a great deal of importance to the motion on Crown corporations which I am introducing today. I am doing so for the third time. Each time, we manage to convince more and more members to support it.
What is the purpose of that motion? It is not to oppose the creation of Crown corporations nor to gloss over the activities of those corporations, but rather to throw some light on this whole governmental business.
To be more specific, Mr. Speaker, and to show the importance of that motion, I may say that it is a well known fact that the federal government now owns and operates an extensive industrial, commercial and even financial sector. For example, the government develops uranium mines through its Crown corporation Eldorado Nuclear Limited, and coal mines through the Cape Breton Development Corporation. The State is also engaged in mining prospection through the Quebec Mining Exploration Company, and oil exploration through Panarctic Oils Ltd. The State operates one of the largest railway systems in the world through the Canadian National Railways. It also operates a number of road transportation companies through the Canadian National Transportation Ltd., and the largest hotels in Canada through the Canadian National Hotel Ltd. The State is also involved in air transportation through Air Canada and Eldorado Aviation Ltd., in overseas shipping through the Canadian National and the Societe de Transport du Nord Ltee. Moreover, the State is one of the biggest producers of rubber in the world through its Polymer Corporation Ltd. It owns and operates one of the most extensive radio and television broadcasting network in the world through the Canadian Broadcasting Corporation. It produces and sells electricity through Quebec Hydro and Ontario Hydro. It lends money at interest through the Industrial Development Bank, the Central Mortgage and Housing Corporation, the Farm Credit Corporation and various deposit and savings funds. Mr. Speaker, based on the estimated figures to be found in the annual reports of these corporations, the turnover of the State at the present time amounts to nearly $20 billion per year.
Mr. Speaker, this is an extremely important area of financial and business activity for the government. By moving this motion dealing with Crown corporations, I wish to call the attention of all members to three very specific facts. First of all, because Crown corporations were created by the federal government, we feel they should be accountable to Parliament, so that each one would operate strictly within its own area of activity. Now the only information we can get from those corporations as members of Parliament is some kind of a summary of their activities included in their annual report. In other

words, parliamentary control is practically non-existent. I will give some examples later.
Second, the government owns and operates at present in Canada a hundred or so industrial, business or financial public enterprises, with assets of well over $20 billion. This contemporary phenomenon of a trading State raises many problems, for example: what will be the status of the trading State? What is its legal status? Several members do not know. Moreover, is the trading State subject to public law or to private law and, in both cases, in what circumstances? Then again, Mr. Speaker, few members, even those who have been in the House for a very long time, could answer this question. Will it have a mixed status proceeding from both private and public laws? Indeed, is it the private or the public law which applies in the administration of those acts? Finally, what control does Parliament have on those Crown corporations? That is another important question, Mr. Speaker. Why can the Auditor General, who is a parliamentary official rather than a government official, not audit the accounts of all the Crown corporations, but only those of a few? And yet, he would be the ideal person to exercise this parliamentary control on behalf of the members.
Another question one must ask, Mr. Speaker, is this: the main sources of information for the members on those corporate activities are: the annual report, the questions put on the order paper and the motions for the production of papers. But in those three cases, there are some serious shortcomings. What do we do with the annual report that we get at our office? We glance through it, we examine it, we scrutinize it paragraph by paragraph, but it does not say any more than what is written in it. It is a summary on administration. Its figures are roughly lined up and fail to inform the reader or the member on the internal operation of the corporation involved or on the role it plays within the economy.
Mr. Speaker, I would like to make a suggestion which seems most reasonable to me: reports should be referred to the standing committees of the House for consideration and review.
Mr. Speaker, the hon. members should be allowed to call officials of Crown corporations as witnesses in order to question them about annual reports. Thus would be recognized the important part hon. members play in the parliamentary control of Crown corporations. Let us not forget, Mr. Speaker, that Crown corporations administer over $20 billion a year, which is close to the federal government budget and that is why hon. members should have their say in that matter.
Some ministers will reply that all this is quite right but that it is still possible to ask a written question or, as is commmonly said, to put a question on the order paper.
In other words, the question on the order paper is the one the hon. member puts there. The questions may be technical but in all cases, and here I quote Beauchesne's Parliamentary Rules and Forms, 4th edition, citation 181, para. (3), page 153:
A Minister may decline to answer a question without stating the reason for his refusal, and it is irregular to comment upon such refusal.
November 4, 1974

Mr. Speaker, this means that according to the rules, a minister could be justified in refusing to answer a valid question when, normally, the hon. members should get the required information.
Mr. Speaker, I moved this motion especially for the hon. members to become aware of how limited parliamentary control is over Crown corporations: I quote:
It happens fairly often that the official of the company or the minister refuse to answer. The main reasons that are invoked are as follows:
Internal administration problems-A public corporation does not have to answer questions dealing with matters of internal administration For instance, in a public enterprise, management has sole jurisdiction over matters pertaining to the "appointment of personnel". It does not disclose information coming from personnel files of officials or employees.
Here, I refer to a speech made in Paris in 1946 by Sir John Anderson, on the subject of public corporations. I quote:
-Similarly, "it is not customary to ask Crown corporations (public enterprises) for information on their employees or other matters of internal administration.
Here I refer to the Hansard of the House of Commons, for June 23, 1963, question No. 663:
It concerns the salaries, amongst other things, of employees and officials of Crown corporations. I quote: Employees' salaries-A public Corporation will not answer a question whereby it is requested to disclose the salary level of an employee or a group of employees ... salaries are considered as confidential matters.
All we need here is to refer to Hansard reports for October 23, 1963, November 4, 1963, October 30, 1967 and December 20, 1967 to find examples of this type of answer.
On the salary matter, the Minister of Justice said:
"It is to be noted here that in the Public Accounts, while the individual salary of any Civil Servant above a given bracket is indicated, the salaries of all the employees of a Crown Corporation are grouped under one single item. A question in the House put to the responsible minister is virtually the only way to be informed of the individual salary of a Civil Servant or official of a Crown Corporation, if the minister is willing to reveal it." Recently, the CBC stated through the responsible minister, "it is contrary to the Corporation's practice to disclose the salaries paid to an individual".
I now refer to Hansard of January 15, 1969. And I could quote many other references to illustrate this type of answer.
With respect to fees and honorariums paid to officials, it says:
Fees and honorariums-A public Corporation will also refuse to reveal the fees paid to an individual: "It is not common practice to ask the CBC to disclose the fees paid to any individual."
At this point, I am referring to Hansard of December 4, 1963 and December 18, 1963.
And in a similar case, the hon. Minister stated:
The CBC informs me that due to the competition it has to face, it does not usually disclose the fees paid to the individuals it happens to hire.
And here, I refer again to Hansard, Mr. Speaker, but I will spare you the reference.
Fourth, and I quote:
Contract following call for tenders.-The public corporation will refuse "to disclose the names of companies or individuals submitting tenders or to give information on tenders received".
Crown Corporations
Internal studies.-It was also decided that "it was against practice ... to disclose the names of individuals assigned to studies". The corporation considers such studies as "private documents" for internal use.
And here, I refer to Hansard of February 26, 1969, on page 5969.
Remuneration of the executive director.-"It is the practice... not to disclose any information from personnel records of officials and employees and this practice is supported by the Sessional Committee on Railways and the Shipping.
I refer here to the deliberations of this committee on December 20, as reported on page 5665, and on March 10, 1969, as reported in Hansard, on page 6387.
-This answer was given by Air Canada, the Northern Transportation Company Limited, Eldorado Nuclear Limited, Cape Breton Development Corporation and Polymer. However, the C.N.R. the C.O.T.C., the C.B.C., and the C.M.H.C.... disclosed the remuneration of their executive presidents. Therefore, there is no uniform and well defined practice.
I would also say to my colleagues on both sides of this House that it is not a partisan motion. Its aim is on the one hand to demonstrate to hon. members that Crown Corporations have a very important commercial, financial and judicial part to play in our society and that these corporations are the continuation of government activity and, finally, that their budget is over $20 billion.
Mr. Speaker, when a member of Parliament gets in touch with the Canadian Transport Commission, Air Canada or the Canadian Broadcasting Corporation, there is every possibility that, considering the well established practice in the House, he will not get an answer and most of the time the minister, even if he would like to answer, will have done so in private rather than publicly.
It shows, Mr. Speaker, that parliamentary control over those government creatures that are the Crown corporations is almost inexistent. On the one hand, the annual report is general and incomplete and on the other hand, questions on the Order Paper involve no obligation for the minister to answer and finally, the member of Parliament really cannot on his own authority, meet the chairmen of those corporations to get the information he wants.
So, Mr. Speaker, when the time comes for the House to approve estimates or subsidies to be applied against the deficit of the Canadian National or Air Canada or any other Crown Corporation, under the out-dated system that we have, the member of Parliament has the right, the obligation to approve subsidies to offset a loss but cannot, under the rules, make a corporation explain its deficit. It only does so in answer to a formal request from the minister who, then, must be kind enough to convey the information to us.
Mr. Speaker, I shall not discuss the motion any longer, so that my colleagues from both sides of the House will have the opportunity of expressing their views.
I just wanted to point out that this is not a motion for or against the corporations. My only aim is to have a special committee appointed to study the whole operation of the Crown corporations and their relation with Parliament, so that one day Parliament may have direct control over them.

November 4, 1974
Crown Corporations

Mr. D, M. Collenette (York East): Mr. Speaker, it is a great pleasure to talk to the motion before us in the name of the hon. member for Lotbiniere (Mr. Fortin). The hon. member also has on the order paper a very complex bill on this subject. I studied over the weekend and I must say that a number of the points it makes are very relevant and should be looked into further. It seems there are two basic issues involved here. The first concerns the principle of Crown corporations; the principle of state intervention in the economy through Crown corporations. The second deals with the accountability to parliament of these corporations.
I do not wish to take the time of the House debating the philosophy behind the setting up of Crown corporations, but I should like to talk about their accountability to parliament. Part VIII of the Financial Administration Act relates to Crown corporations and incorporates provisions dealing with the control and accountability of such corporations as well as certain financial aspects of their operations. The act defines a Crown corporation as "a corporation that is ultimately accountable through a minister to parliament for the conduct of its affairs". It establishes a threefold classification of Crown corporations and develops a systematic pattern of relationships between corporations, on the one hand, and parliament and ministers on the other.
A departmental corporation is defined as one that is a servant or agent of Her Majesty in right of Canada responsible for administrative, supervisory or regulatory services of a governmental nature. It is, in fact, an ordinary department of government which has been given corporate status. It is subject to the direction and control of a minister and must rely on parliament for annual appropriations to cover its financial requirements. An agency corporation is one that is an agency of Her Majesty in right of Canada, responsible for the management of trading or service operations on a quasi-commercial basis, or for the management of procurement, construction or disposal activities on behalf of the Crown. Like a department or a departmental corporation, it is subject to a considerable degree of ministerial control. Although no very sharp line of division can be drawn, a distinction can perhaps be made between a department as the servant of a minister and a corporation as his agent.
A proprietary corporation is one that is responsible for the management of lending or financial operations, or for the management of commercial and industrial operations involving the production of, or dealing in, goods and the supplying of services to the public. It is ordinarily expected to conduct its operations without appropriations. It usually has a considerable amount of managerial freedom, and such control as the minister or the governor in council exercise over it is comparable to that of a shareholder who holds all or a major part of the stock of a private company.
While the minister is not usually held responsible for the day to day acts of the servants of a proprietary corporation, as he is for the acts of the officers of his department, he is often given a statutory right to intervene to give advice or directions and to demand an accounting so

as to ensure that there is an adequate measure of public control and accountability. A further distinction is that, since the amendments to the Income Tax Act in 1952, a proprietary corporation is subject to income tax.
A general pattern or blueprint of the financial relationships of Crown corporations with parliament and the ministry is set out in the Financial Administration Act, but this is not a complete and exhaustive statement of those relationships. Some Crown corporations are not listed in the schedules and are not subject to the act. Some are subject to specified sections of the act, while others that are listed are subject to it only to the extent that it does not conflict with the special statutes under which they were created or under which they operate. Thus, the Canadian Wheat Board, the Bank of Canada and its subsidiary, the Industrial Development Bank, are not listed in the schedules because of their special functions; they are excluded from the application of the act and are governed by the acts incorporating them.
When a Crown corporation is to be created, the usual practice is for parliament to enact a statute, which authorizes the establishment of the body and defines the corporate powers and purposes, outlines the basis of its financing and sometimes sets limits on its borrowing powers, determines the size and type of the board and sets the basis for the selection of members, the period of their tenure of office, remuneration, qualifications and grounds for removal. Some statutes, however, such as the Department of Defence Production Act, the Atomic Energy Control Act, the Research Council Act and the St. Lawrence Seaway Authority Act, contain provisions delegating the power to establish corporations to the governor in council, a minister or other specified authority under the provisions of the Canada Corporations Act. Perhaps it might be better that all these Crown corporations have their terms of reference clearly defined by parliament.
Canadian Crown corporations, following business practice, are usually managed by boards of directors. There is no uniform practice in dealing with the constitution of the boards, their size and method of selection, or with the tenure of office, remuneration and removal of directors. Provision for each corporation is made in light of its special needs and circumstances. I think the hon. member made a very good point. Perhaps the public does deserve to have closer scrutiny of the salaries paid to officials of Crown corporations and of their general hiring and management practices.
Appointments to the boards are usually made by the governor in council rather than by a minister, although a minister customarily makes the recommendations and in case of companies incorporated under the Canada Corporations Act he may actually make the appointments. It is not the practice to appoint ministers to the boards of Crown corporations. When departmental representation is required, civil servants are usually named, but the majority of the part-time members of boards are selected from outside the public service. The remuneration of board members is usually fixed by the governor in council. However, when a civil servant is named to a board, he serves without additional remuneration.
There has been some discussion by hon. members of members of this House sitting on the boards of Crown
November 4, 1974

corporations. I think this aspect of a member's parliamentary life should be looked into. As a freshman member of parliament, I think it would be very useful to participate in decisions affecting Crown corporations which are involved in so much of the economic life of Canada. Indeed, one of my colleagues, a little later, may delve into this aspect of members participating on boards.
Except for a modest provision for making working capital advances to Crown corporations, the Financial Administration Act contains no specific authority for financing the capital and operating requirements of the corporations. The methods of raising funds for the capital purposes of the corporation are usually set out in the company's statute of incorporation, but provision may also be made in special statutes, as in the case of the Canadian National Railways, or in votes in annual appropriation acts, as in the case of Atomic Energy of Canada Limited and the National Harbours Board.
In general, capital requirements may be financed from internally generated funds and other reserves of the corporation, in so far as these are available and are not required by law to be paid into the consolidated revenue fund; from the sale of bonds or debentures to the public with or without the guarantee of the government; from loans, advances or outright grants out of the consolidated revenue fund; from the sale of equity stock to the government; or from borrowings in the private sector secured by the pledging of corporate assets. Where a corporation's funds are not sufficient to finance its operating requirements, financial assistance for all or part of its programs is usually sought from the government. This is usually extended through outright parliamentary grants unless there is a reasonable expectation that operating deficits will be offset by surpluses within a relatively short time.
Certain corporations have the power to borrow from the public. The instances in which they have been able to borrow from the public without a government guarantee have been confined to short-term requirements, and usually from the chartered banks with which they normally transact business. Their long-term borrowings from sources other than the federal government have usually required a government guarantee. Where such a guarantee is involved, parliamentary authority is required; in addition, the terms and conditions of the loan itself, as well as the guarantee, require prior approval by the governor in council.
Government loans to Crown corporations for the financing of capital expenditure programs, whether such programs involve the acquisition or construction of assets, the lending of funds to the public or the strengthening of a corporation's working capital, are, in almost all instances, interest-bearing. The interest rates for loan drawdowns are usually set quarterly on the basis of the cost to the government of borrowing funds for a comparable period, plus approximately one-eighth of 1 per cent to cover other costs not reflected in the interest rate, and these rates are applicable for the whole period of the loan. Usually, loans are repayable over the period of the loan, with periodic payments of principal and interest.
Where loans are made for the acquisition of fixed or physical assets, the repayment schedules are usually based on the expected useful life of the assets for which loans
Crown Corporations
are incurred. In some instances the periods are stipulated in the applicable legislation. No attempt is made to deal with each individual asset and its expected life but, instead, with groups of similar assets. For example, in the case of a power plant, the amortization period is based on the expected useful life of the plant as a whole, rather than on its individual parts. Where loans to the corporation are for the purpose of relending to the public, the repayment period is usually based on the period or periods over which the corporation in turn receives repayment.
Controls operate in a number of ways, but the most significant are the provisions of the statute under which the corporation was created. These encompass the nature and constitution of the governing board and the appointment and removal of members or directors; the approval of budgets and proposed methods of financing; the determination of the criteria to be followed in ensuring that satisfactory accounting records are maintained and financial administration procedures followed; the requirements of an independent and effective audit; and the preparation and submission of adequate annual and other reports which fully disclose the activities, operations and affairs of the corporation.
It is here that I take exception to the remarks of my colleague from Lotbiniere, in that I believe the reports of Crown corporations do, in the main, serve their purpose. They inform the members of the House and the general public of areas in which they have been active during the year and reflect the general record of the corporation. There are other areas of control such as the approval of bylaws, contracts and the salaries of senior officers, the right to issue directives and the requiring of information. Not all of these are of equal importance or of uniform application to all corporations.
The basic financial control of the Crown corporation is through requiring the submission and approval of budgets. Under section 70 of the Financial Administration Act all agency and proprietary corporations prepare annual capital budgets which are submitted to the appropriate ministers, the President of the Treasury Board and the Minister of Finance, for their recommendation to the governor in council. After approval by the governor in council, the budgets are laid before parliament. Major projects or expenditures are set out in the budgets, including estimates of proposed capital expenditures for land, buildings, plant and equipment, increases in working capital, amounts required for redeeming maturing indebtedness and, in the case of those companies which administer lending programs, the amounts required for making loans.
An estimate is usually made of the over-all cost of a program, of the estimated commitments for future years, and of the cash required for the year under review. Some indication is also given of the source^ from which the funds required will be obtained. The approval of the budget does not constitute an authority for the corporation to borrow, nor does it signify an undertaking on the part of the government to lend or to guarantee loans. These powers must be specifically granted by parliament, either annually or in a general continuing authority, and the terms are usually subject to the approval of the governor in council.

November 4, 1974
Crown Corporations
Agency corporations are also required to submit their operating budgets for the approval of the two ministers, the appropriate minister and the President of the Treasury Board, but there is no specific requirement to lay these before parliament.
Proprietary corporations are not required to submit operating budgets, presumably on the ground that they should be freer than agency bodies in the management of their own affairs. Nevertheless, there are several exceptions. For example, the Canadian National Railways and, as the hon. member mentioned, the Cape Breton Development Corporation are required to submit both operating and capital budgets to parliament. However, the nature and magnitude of operations of both agency and proprietary corporations are subject to parliamentary approval when funds are sought to cover operating deficits.
Statutes of incorporation usually require a corporation to maintain an accounting system satisfactory to the responsible minister. Under the Financial Administration Act a corporation must keep proper account books and related records, and may make provision for reserves for the depreciation of assets, uncollectible accounts and other purposes, subject to the direction of the Treasury Board.
Annual statements of accounts are required, for which standards of disclosure and reporting comparable to those required of private companies are established. These are to be prepared in accordance with such directions as to form as the Treasury Board may give. In addition, a corporation must make such other reports of its financial affairs as the appropriate minister requires.
The auditor of a Crown corporation is usually designated in the statutes of incorporation, although some acts merely provide for an appointment to be made by the Governor in Council. When the designation is by statute the Auditor General is usually named, but when an act provides for appointment by the Governor in Council the choice in the past has been made from private auditing firms. However, even in the latter case the Auditor General is eligible for appointment; the Financial Administration Act provides that, notwithstanding any other act, he may be appointed the auditor or a joint auditor of a Crown corporation. I think this goes far enough to answer the point brought out by my colleague.
The Financial Administration Act gives comprehensive directions embracing both the accountancy and authority aspects of the audit. The auditor of each corporation must report annually to the appropriate minister, and the general form of his report is prescribed. Each Crown corporation must submit its annual report, together with its financial statements and the auditor's report, to the appropriate minister, who must lay its report before parliament within 15 days after he receives it, or, if parliament is not then in session, within 15 days after the commencement of the next session.
In 1951 the Public Accounts Committee recommended that the annual report of each Crown corporation should be referred for study to a select committee of the House, and that the annual reports of all Crown corporations should be published together in one section of the public accounts.

Usually some direction as to the disposition of surplus moneys of Crown corporations is given in the statutes of incorporation.
Agency corporations are usually required to surrender their profits to the Receiver General. The Canadian Commercial Corporation, which may retain for its own purposes all moneys received in the course of its business, is an exception, although the Minister of Supply and Services may direct it to pay over to the Receiver General any of the moneys administered by it that he considers to be in excess of requirements.
The proprietary corporations usually have a greater degree of freedom in using their own funds, and many are permitted to retain their profits. However, the practices followed differ from corporation to corporation. For example, Central Mortgage and Housing Corporation, the Farm Credit Corporation, and the Royal Canadian Mint may retain their earnings to establish reserve funds, but when the statutory limits on these have been reached all additional earnings are payable to the Receiver General.
The Northern Canada Power Commission may retain its surplus earnings, to be used, subject to the approval of the Governor in Council, in the reduction of rates to consumers. The Export Development Corporation may pay excess moneys to the Receiver General on demand. The Financial Administration Act contains a variation of this provision, whereby the Minister of Finance and the appropriate minister, with the approval of the Governor in Council, may require a corporation to pay to the Receiver General any moneys considered to be in excess of requirements, such excess to be used to discharge any debt owing by the corporation to the Crown, or to be applied as revenues of Canada. This provision, however, is operative only when it is not inconsistent with any legislation applicable to a corporation.
The Minister of Finance exercises a general control over the designation of bankers and depositories for Crown corporations. Under the Financial Administration Act a corporation, with the approval of the minister, may maintain accounts in the Bank of Canada and in such banks in Canada or financial institutions outside Canada as he may approve. Normally commercial banking facilities are used, although in a few cases the Bank of Canada has been designated as the depository for a corporation's bank balances. There is a further provision in the act authorizing the Minister of Finance, with the concurrence of the appropriate minister, to direct a corporation to pay all or part of its money to the Receiver General, to be placed to its credit in a special account in the consolidated revenue fund.


Mr. Ralph Stewart (Cochrane):: Mr. Speaker, the motion of the hon. member for Lotbiniere (Mr. Fortin) is similar to the one I moved a few years ago, but, in fact, his goes further. Mine only suggested that there be at least one member of parliament on the board of directors of every Crown Corporation, to ensure a better control of the expenditures the government makes through its corporations. The hon. member for Lotbiniere thinks that it might be convenient to form a special committee of the House to study every aspect of Crown corporations. It is a good suggestion, although I do not necessarily agree with
November 4, 1974

everything the hon. member said. It seems to me that this question should have been discussed long ago.

When I say I do not agree with everything the hon. member for Lotbiniere has said, what I mean is I think he has decreased his chances of having this motion passed by the House. It is not that I disagree with anything specifically in his motion, as I think it is an excellent motion, but the fact that he says we must have a special committee look into the aspects of each and every Crown corporation-at least that is the way I interpret it-means that we would have a committee studying all of these Crown corporations for a very long time. I do not know how many there are, but I think there are over 40. Therefore, for the simple reason of practicality I could not go along completely with the motion of the hon. member.
If the hon. member were to propose his motion in a different way so the House could consider asking for the subject matter to be referred to the committee I think his motion would be more acceptable to the House, and I would encourage him to do so. This is a subject that has been very dear to my heart since I have been a member, and I have spoken about it over the years.
I feel very strongly that as members of parliament we come here to represent the people of Canada and yet are unable to represent them properly simply because we have no control over certain aspects of government spending. It is suggested that Crown corporations must be autonomous and independent. We can all realize why, under certain conditions, a Crown corporation must be autonomous, but there certainly must be some kind of control, some kind of answerability, whereby Crown corporations must exercise responsibility to the people of Canada through their elected members who speak on their behalf.
Many times in this House and in committee we have asked a minister for some information, or have made a suggestion concerning a Crown corporation under his aegis, and have been told that that body is autonomous, is independent, and therefore he will have to refer the matter to that corporation.
In many instances the minister seems to have absolutely no control over such bodies. We could take almost any Crown corporation as an example. The CNR is an obvious one. The CBC is another. No one wants to control the press of this country. I am sure no one would suggest that the government should control the CBC. On the one hand while no one suggests the government should have control over the press, on the other hand such a body as the CBC should not have licence-which very often is the term used in the name of freedom of the press-to do whatever it wishes. There must be certain norms established, and I say this must come through the voices of the representatives of the people.
I wonder whether perhaps the hon. member would consider making an appeal to the government on the basis that it really is not necessary to have Crown corporations examined in detail by a committee but rather that we should have an opportunity in committee to examine all the general aspects of Crown corporations, and particularly the answerability feature.
Crown Corporations
In the past I have suggested that members of parliament should be members of the boards of directors of Crown corporations. This has been done in some provinces. It has also been done in some other countries. However, this has not met with complete approval in this House up until now. Perhaps this is not the answer, but at least it is a suggestion. It would seem to me that a special committee, such as the committee proposed by the hon. member for Lotbiniere (Mr. Fortin), could be the vehicle to examine the feasibility and the pros and cons in respect of members of parliament being on those boards. The committee could examine all the other aspects having to do with the answerability of these corporations to the people of Canada through their representatives. So I would make that suggestion to the hon. member. Perhaps he might see his way clear to do this.
I rather think the government would be of a mind to accept that kind of approach. From what I understand- and I hope this is the case-more and more items discussed here in private members' hour, whether by way of notices of motions or specific bills, will be referred to committees, or at least their subject matters will be so referred. This does not necessarily mean that the government says it will grab the ideas proposed, but rather that it will allow such items to go to a committee for study. I believe this is a great step forward because, in the last few years, it has developed that private members' hour has been nothing but a time for members to come forward with their favourite ideas only to find that no one would listen, and that motions and bills would simply be talked out. It certainly is not my desire to talk out this particular motion. I simply want to say I would encourage the hon. member to use this approach to the government, and I would encourage the spokesman for the government to recommend that this matter be referred to a committee so that the general aspect can be studied in detail.


Mr. Jack Cullen (Parliamentary Secretary to the Minister of Finance):: Mr. Speaker, it is always a pleasure to discuss the subject of Crown corporations. The hon. member for Lotbiniere (Mr. Fortin) is to be commended for his persistence. As he indicated at the commencement of his remarks I think he has more and more won approval from members of this House for the kind of action or stance he wishes to take.
The hon. member for Cochrane (Mr. Stewart) favours a somewhat different approach, namely, the appointment of members of parliament to boards of directors. When one realizes there are approximately 40 Crown corporations perhaps it is not appropriate to take this position. However, I do not think the hon. member for Cochrane would suggest that a member of parliament should sit on the board of directors of each Crown corporation. Most assuredly there are some corporations in respect of which I believe there would be some merit in considering his suggestion.
Having been a member of the Public Accounts Committee for some years, I am aware of the frustration experienced by members of that committee when it is felt that a particular Crown corporation warrants more thorough or in-depth investigation. I remember, I believe it was during the first parliament I was here, that of 1968-72, when we had an opportunity to study the expense
1030

November 4, 1974
Crown Corporations
accounts of CBC personnel travelling abroad, and also the expense accounts of CBC personnel travelling within Canada.
The Auditor General had conducted quite a thorough study at that time. He compared the hotel rates being paid in various places such as Winnipeg, Victoria and Quebec. I think it is worthy of comment that the Auditor General could not find fault with the personnel of the CBC. If anything they were found to have been quite frugal in the manner in which they used expense money, recognizing that after all it was the taxpayers' money.
The frustration we experienced was when the CBC management decided that something was to be filmed in Toronto and decided to move 14 or so personnel from Winnipeg to the Toronto area. All we could study was whether or not those 14 people had lived within the limits of their expense accounts in respect of hotel accommodation, taxi cabs, meals and so on. What we could not get at in that committee was the reason why it was necessary to have 14 people travel from Winnipeg to Toronto. We could not determine whether the personnel might have been available in Toronto, or whether it might have been possible to use some camera men, for instance, under contract. That was the type of frustration felt by the committee.
I think that is the type of problem the hon. member for Lotbiniere and the hon. member for Cochrane are trying to solve, that is, that when board decisions are made to move personnel or to move them by a particular means of conveyance, a committee should have an opportunity to determine why such a particular decision was taken. This, I believe, is an example of the frustration experienced by many members of parliament in respect of Crown corporations.
To my way of thinking-and the hon. member for Cochrane touched on this-the hon. member's motion is too broad to be accepted by the government. In other words, he is suggesting a special committee of inquiry seemingly to look into all Crown corporations. Yet he was quick to point out that he is not challenging Crown corporations, he is not saying that there is anything wrong with them but that there might be something wrong. What he is saying is that we do not have an opportunity to do an in-depth study of Crown corporations under the present circumstances.
I was impressed by the research work done by the hon. member for York East (Mr. Collenette). I must say quite sincerely that listening to his address today I learned a fair amount about Crown corporations. Obviously when asked to participate in this debate he did so seriously, and did a tremendous amount of research. I must also say quite frankly that my interest in Crown corporations has been fairly parochial. I was interested in the workings and machinations of Polymer, now called the Polysar Corporation. But I think the hon. member indicated a broader interest. He also showed us the manner in which one can check out and study budgets if one is moved to take that particular course of action.
I do not know how closely the hon. member for Lotbiniere was listening to the address of the hon. member for York East, but I would commend it to him. There was a

tremendous amount of information contained in it which he could study. He might say, "If that is the way that certain Crown corporations operate, I really do not think I am too interested in them. There seem to be enough safeguards, and if I want to do so, I can find out by either going to the minister, by putting a question on the order paper, or by attending the committee."
Listening to the hon. member's comments I found that he was good enough to point out that there were areas where it might not be such a bad idea to have a more thorough investigation into a particular Crown corporation, in support of the stance of the hon. member for Cochrane.
So we seem to be of one mind here. The only differences are in the methods or means of approaching this, whether we establish a special committee of inquiry, whether there is sufficient protection now to protect the Canadian taxpayer, or whether we need members of parliament or other people appointed to represent the government on these boards of directors and to report directly to parliament. I think that is the thrust of the motion we have before us today.
I support the idea that all these motions should not be talked out. In the six years that I have been here I have heard some excellent ideas advanced during the private members' hour. I have participated in several of them to the point where the hon. member for Winnipeg North Centre (Mr. Knowles) once referred to me as the hatchet man in the private members' hour. However, I was sincerely interested in the subject matter of the debate and wanted to participate in it.
Unfortunately when one is on this side-and most of the motions emanate on the other side, which is appropriate because we here have other avenues of promoting our ideas-one ends up speaking for five minutes only and being called a hatchet man, whereas the individual who introduced the motion might have taken twenty minutes. This makes it difficult for us to express our judgment. But there are instances of ideas put forward in private members' hour being adopted, and probably this is what encourages the hon. member for Lotbiniere to keep pressing the point he is making today.
Let me say, on a sad note, that when a Canadian destroyer had a fire and explosions on board, this came to my attention because one of the crew members on that ship was from my riding and he died in the course of the accident. Under the rules of the Department of National Defence, which were still a hangover from wartime, a sailor had to be buried on land closest to where he was killed, even though, as in this case, he had never set foot on it. Then there was the ridiculous situation of a man in the Canadian army who went on a course to Great Britain, and on the train from his port of landing died from a heart attack. He had to be buried in Great Britain although he had only just got off the boat which took him there.
The Americans, in spite of the great number of soldiers who were killed in the war in Viet Nam, established a policy whereby people killed on active service were brought back to their native land if their families so wished. I put forward a motion that the families of Canadian personnel killed in the course of performing their duty should have the option to have them buried in
November 4, 1974

the place where they performed their duty, or brought back home.
Frankly, I am not getting off the subject, Mr. Speaker, but rather stressing this point to indicate to the mover of the motion that there is hope that motions such as mine and the one before us might be adopted and accepted by the government. If a bill is introduced, possibly it will not be accepted but the subject matter of the bill might be proceeded with and studied by a committee.
I thought the hon. member might be interested in a few facts. In reference to Crown corporations let me point out that today there are approximately 40 of them. When I did my research on that subject I found it mind boggling. I did not realize there was that much necessity for government involvement. I think the point made by the hon. member is good, that we have to keep our eye on these Crown corporations.
Let us look at the short period of ten years from 1963 to 1973. Legislation was passed to create a number of Crown corporations. For example, in 1963 the Economic Council of Canada was created; in 1966, the Company of Young Canadians; in 1966 the National Arts Centre Corporation; in 1967 the Canada Deposit Insurance Corporation, again in the same year the Canadian Film Development Corporation, the Cape Breton Development Corporation, the National Museums of Canada; in 1969 the Freshwater Fish Marketing Corporation. I will not go on with them. If I were trying to kill time I could list several others that are here, but I do not wish to do that.


Mr. Knowles (Winnipeg North Centre):: You don't have to try.


Jack Sydney George (Bud) Cullen: What disturbs me, and I am sure disturbs hon. members, is that from time to time legislation must be introduced to increase the powers of existing corporations to enable them to fill the changing demands of the areas which they were set up to serve. I am sure that this is necessary, but I think it should be scrutinized very carefully because I do not like to see the government getting involved in it.
When I see a Crown corporation expanding, I ask myself: is that not a role that could be better played by private industry? My view is that if it can be, we have no business there. Let private industry look after that. There may be areas where we must move in, and the one which we have heard about most is the Cape Breton Development Corporation. I think it was set up in 1967 to carry out the rationalization of the coal industry, and to broaden the base of the Cape Breton economy by making it less dependent on coal. I think this is where the government had an obligation to move in to help the area.


Mr. Deputy Speaker:: Order, please. The hour appointed for the consideration of private members' business has expired. I do now leave the chair until eight o'clock tonight.
At six o'clock the House took recess.
Oil and Petroleum AFTER RECESS
The House resumed at 8 p.m.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Macdonald (Rosedale) that Bill C-32, to impose a charge on the export of crude oil and certain petroleum products, to provide compensation for certain petroleum costs and to regulate the price of Canadian crude oil and natural gas in interprovincial and export trade, be read the second time and referred to committee of the whole.
Harvie Andre: Mr. Speaker, a few minutes before I called it five o'clock I had made some comments which, with the indulgence of the House, I should like to withdraw.
The Minister of Energy, Mines and Resources (Mr. Macdonald) had made an off the record comment about my leader which caused me to lose my temper, and I made some comments regarding the minister's competence and how he came to occupy his present portfolio.
The remarks in respect to competence I do not withdraw; his record speaks for itself. The remarks on how he came to occupy the portfolio can only be conjecture on my behalf. I should like to withdraw those remarks and would prefer I had not made them in the first place.


Donald Stovel Macdonald: Mr. Speaker, on a question of privilege, I appreciate the hon. gentleman's sentiments. If I exchanged remarks across the floor in the same vein, I withdraw them as well.


Some hon. Members:: Hear, hear!


Harvie Andre: However-


Stanley Howard Knowles: Not just a simple but? It is however!


Harvie Andre: Mr. Speaker, Part III of Bill C-32 deals with the question of price controls on natural gas. From the minister's remarks it appears that he feels it necessary for the government to impose price controls on natural gas because the price is below commodity value and, therefore, there is a considerable likelihood that this valuable fuel would be wasted. That does not justify this approach, Mr. Speaker.
In violation of the minister's commitment to consult fully with the purchasing provinces before taking such a step there is provision in this part to allow him to decide unilaterally what the price shall be. We should ask why gas has not reached its proper commodity value now, and the answer is that a competitive market does not exist. There is a monopoly buying situation through Tran-
283 05-6 6Vi

Oil and Petroleum
sCanada Pipe Lines. The solution is to require Tran-sCanada to act as a common carrier, Mr. Speaker. That would produce a multiplicity of buyers and suppliers. There would be a competitive market, and the price of natural gas would reach the proper level. Canadians would be spared the expense of a tremendous bureaucracy to implement this part of the bill, as well as the tensions of federal-provincial conflicts.
There are some fundamental questions that western industrial producers as well as the provinces would like to have answered, Mr. Speaker. Who would receive the additional revenues? Is the government going to invent some new kind of tax to skim off the cream? Why is it that the minister has not introduced general price controls on all energy? If there is in effect a national policy of price controls on energy, why are hydro, coal, wood, uranium and all sources of energy not included? Westerners might be forgiven for thinking that it might be because these other commodities have to be purchased from provinces other than Alberta.
Part IV of the bill deals with cost compensation, which is a tremendously complicated method of arriving at the subsidy level for oil imported by eastern producers. When asked in committee why there was such complexity, government spokesmen said they wanted to avoid paying some companies too much. So they came up with this complicated system which removed the incentive to shop around for the best price on the international market. That resulted in crude oil costing less in Montreal than in Toronto.
According to the national oil policy which came out in dribs and drabs over the past year there was to be a uniform price across Canada, based on the Montreal price less the cost of transportation. But now the Toronto price is higher than Montreal. That is a good thing for the people of Montreal, of course, but how is a pipeline justified in that case? I wonder if Interprovincial Pipe Line Company is having second thoughts? Why build a pipeline when the system in place gives Montreal a cheaper oil than would be the case if pipeline tariffs had to be paid?
Part V contains a provision that Bill C-18 contained, namely, that a federal civil servant can walk into the office of any premier in Canada and seize any files he chooses. That is an absurd provision, to say the least. It is another example of the arrogance of this government.
The saddest aspect of this whole energy federal-provincial confrontation of the past year and a half is what is happening to the country in terms of our future economic viability and loss of potential. Right now the oil and gas industry of Canada is, essentially, in neutral. It is fulfilling commitments made a year or two ago, but not undertaking any new commitments to explore and develop new reserves.
Statistics indicate about a 10 per cent drop in drilling activity. That in itself is alarming. We should be increasing our exploration and development in order that we will be self sufficient in the future. These statistics do not however show how bad the situation really is because the companies are in neutral.

A lot of the expert personnel who are necessary for healthy exploration and development activity are leaving Canada. I refer to the drilling companies and their personnel. So far we have lost 37 or 38 rigs. These are long footage rigs, the most expensive and most difficult to replace. Even worse, we have lost the personnel to go with these rigs. We have lost seismic crews, geochemists, geologists and geophysists. These are Canadians who were born and educated in this country. They did not want to move, but things have come to a halt. In order to maintain their livelihood they have moved to Denver, Dallas or Houston.
People in the inudstry have indicated that if we went back to the post March 27 mood that existed in the prebudget period when it looked like the energy situation was straightened out, it would take two years to restore the previous effort. We have lost two years, and every day of delay prolongs that.
In order to make any sense whatsoever, a national oil policy must have as its prime priority the development of sufficient supplies for Canada to remain self sufficient. We have the geological potential to be self sufficient in conventional supplies. We have the tar sands with their enormous potential, as well as enormous reserves of other forms of energy. It would be a tragedy, to put it mildly, if we did not develop this potential and did not remain self sufficient in the future. I might say there is a very good possibility we will not do so if things remain the way they have been, Mr. Speaker.
There is continual federal-provincial bickering and changing of rules. Commitments made one month are broken the next. All this has shattered the confidence of the industry. A severe decrease in activity has resulted. This country's long-term potential is being endangered. How do we get out of this situation?
It is essential that the Minister of Energy, Mines and Resources and the government start the ball rolling by making some gesture to indicate they have lost interest in maintaining this fight. The provinces would like to see it come to an end. They would like to see a mood of optimism and enthusiasm restored in the oil and gas industry. They would like to see these companies develop the reserves that Canada will need.
A good place to start would be by removing clause 36 of this bill which states the federal government can unilaterally impose its will on the producing provinces. Removal of that clause would demonstrate that the government has confidence in the goodwill and interest of Canadians in other parts of Canada in the future of this country, and is willing to gamble on co-operative federalism. If it made that simple gesture it would go a long way toward improving the atmosphere that exists, and putting an end to this ceaseless bickering.
I do not think it can be said often enough or loud enough that Canada is the only western industrialized nation that is self sufficient in energy. We have an opportunity that we have not had in the 107 years since confederation. We are in a good position vis-a-vis our competitors.
It is unforgivable that the government would be wasting its energy fighting and scrapping over who is going to get what chunk of the cream rather than concentrating on how we, as a nation, can take advantage of this opportu-
November 4, 1974

nity we have now. It is unforgivable that that should be the prime motivation of the Minister of Energy, Mines and Resources and of the Minister of Finance (Mr. Turner). Instead of scrapping about the revenue, and worrying about how much will go to the producing provinces and how much to the consuming provinces, they should work this out. They are good people, those who are involved in the other governments of Canada. They are just as fine Canadians as those who come from Toronto Rosedale.
The opportunity that now exists will not exist in perpetuity. There is a limited time frame in which we must seize this opportunity. Any sensible Canadian who thinks about it will agree that the time is ripe now to stop bickering and get on with the building of Canada.


Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, when introducing Bill C-32, the Minister of Energy, Mines and Resources (Mr. Macdonald) concluded by stating:
The objectives which it seeks to achieve are for the most part familiar to members as being now well-established components of an integrated national energy policy.
I challenge that statement. I believe this government in no way has shown an integrated national energy poiicy for this country.
We in the province of Ontario are particularly concerned about the government's handling of this entire question. In Ontario we need essentially two things. In energy we need security of supply. Secondly, we need a pricing of our energy that leaves us competitive, internationally, and with consumers of petroleum products in the other provinces of Canada.
In many ways the government has not suitably protected Ontario with regard to those two matters. For example, the bill we are debating this evening deals with transferring funds raised by the federal government through an export tax so that they may be used to compensate importers on the eastern side of the country. Surely we have to ask ourselves why.
Why is it necessary, in a country such as Canada which produces enough domestic oil to serve the entire nation, that we have to go through a complicated taxing and compensation plan in order to have a one oil price in the nation? It comes down to one very simple fact. While we have the domestic reserves in Canada we do not have the domestic transportation system to deliver those reserves throughout the nation. I say this because I believe the government could have put a suitable transportation system into place and averted the problem of having to deal both domestically and internationally with such a vital matter as the distribution of our available oil.
A year ago I remember being in the lobby watching television when our Prime Minister (Mr. Trudeau) came on and said in a firm voice that a pipeline between Sarnia and Montreal would be built. Yet there is still hesitation on the part of the government. As I say, it is time the government treated the building of a pipeline not only to Montreal but to the east as a national priority, and got on with the job.
It has been suggested by the Minister of Energy, Mines and Resources that the pipeline should be paid for by
Oil and Petroleum
means of charges on the tariff to be borne by consumers in Ontario. I challenge this concept. What the minister is suggesting, in effect, is that the $180 million the pipeline will cost should fall on those who use it in the province of Ontario and that, in the event not one drop should go east, the entire cost would be a charge on the consumers of Ontario. We believe this is unreasonable and that the government should either work out a suitable arrangement with the interprovincial pipeline people for the building of the line, including government guarantees if necessary, or, failing that, build the pipeline itself. In this way security of supply would at least be accorded to the extent that reserves are available in Canada.
Let me touch on the minister's speech in another regard. In introducing the bill he mentioned that there is one oil price throughout Canada. I challenge this. The fact is- though I notice the hon. gentleman very cleverly glossed it over-there is not one oil price across the nation. For example in Montreal today oil costs 70 cents less than it does in Toronto. That is about 2 cents a gallon when translated into the refined product. Here again we are dealing with an aspect I find rather alarming.
The minister claims there is one price. But he does not make it clear that since transportation costs are approximately 70 cents, the price of the product in Montreal is about $6.50, and in some cases as low as $6.00, leaving a minimum differential between Toronto and Montreal of 70 cents per barrel. Translated into gross terms this means Ontario is paying more than $200 million a year more for oil than consumers in Quebec.
A pipeline must be built, and the pipeline must be reversible. A time may come when foreign crude is cheaper than oil we can produce domestically, or we may find that eastern resources will be available to people in Ontario. In either case we believe it important that a pipeline be built without delay so that Ontario may be placed in a more advantageous position.
When he appeared before the committee which was dealing with this measure, then known as Bill C-18, the minister made it clear that the price of oil in Montreal was to be $7.20. As reported at page 12:25 of the minutes of the Standing Committee on Natural Resources and Public Works, issue No. 12, for Wednesday, April 24, 1974, Dr. Ian Stewart said the base price in Montreal would rise to $7.20. I believe that when this question is dealt with in the committee the minister should be prepared to explain why the figure has risen since April of this year as contrary to the minister's declared intention with respect to the one price policy he announced last April.
Another fundamental question dealt with in this bill is that of raising revenue through an export tax on one sector of the industry and using it, at least in part, to compensate importers of oil. I believe that in committee the minister should be prepared to explain what safeguards are intended to ensure that there will not be an international rip-off here. We must bear in mind that in many cases the multi-national corporations which, on the one hand, are exporting our oil, are, on the other, involved in the importation of oil to eastern Canada.
Again in committee last April, it was revealed by one of the officials in the minister's department that approximately 90 per cent of the oil involved in Canadian imports

November 4, 1974
Oil and Petroleum.
is oil imported into Canada by multi-national corporations which, in turn, are engaged in the production of oil in western Canada. Surely when we are dealing with hundreds of millions of dollars it behoves the government and parliament to be very sure there will not be any rip-offs in the international market at the cost of the Canadian taxpayers and the consuming public. Already there is a lot of rumour that posted international prices for oil are being undercut. It is rumoured that oil is available in some places at substantially below stated prices.
The minister must be in a position to ensure that "in between" operators are not making undue profits by gouging Canadian taxpayers and failing to give them the benefit of lower prices while, at the same time, receiving compensation at the taxpayers' expense.
There is a fundamental question here involving free enterprise and the constitutionality of what the minister proposes to do as well as what the provinces have done, and may do in the future, with respect to their natural resources. On this question I believe there is little doubt that the ownership of the oil in the ground or of other resources is vested in the provinces. I also believe there is little doubt that the provinces have complete power to legislate in respect of the oil in the ground and the royalties that they may charge. Both of those powers are clearly set out in the British North America Act. The provinces have complete power to legislate in respect of any oil rigs installations, refineries, storage tanks, pipe lines, etc. within the provinces, again by virtue of the British North America Act.
As the minister knows, these powers given to any province are subject to Ottawa's sanction, perhaps by having the Lieutenant Governor refuse his consent. But what is most disturbing is the fact that both the dominion authority and the provincial authorities have power to tax. For example, a province has the right to levy direct taxation within the province in order to raise revenue for provincial purposes; that is provided by section 92(2) of the British North America Act. But the parliament of Canada has exclusive jurisdiction over the raising of money by any mode or system of taxation; that is provided by section 91(3).
It is readily apparent that in this situation two legislatures are dealing with the same matter, namely, revenue earned by those who produce oil, in the case under debate, or for that matter those who produce gas or any other natural resource in Canada. Surely it is wrong for the federal government to persist in a course of confrontation. That fact is that taxation both at the provincial and at the federal level could take more than 100 per cent of the total revenue earned in the primary resource field if the two legislatures saw fit.
In this respect I would point out that we in Ontario are very familiar with a case that was heard in 1909 in our Supreme Court, confirmed in the Court of Appeal and eventually in the Privy Council, a case that dealt specifically with the power of the legislature virtually to confiscate private property. In that case, known as Forence Mining Co., Limited v. Cobalt Lake Mining Co., Limited, Mr. 
Justice Riddell made the position very clear when he said the following:
In short, the Legislature within its jurisdiction can do everything that is not naturally impossible, and is restrained by no rule human or divine. If it be that the plaintiffs acquired any rights, which I am far from finding, the Legislature had the power to take them away. The prohibition, "Thou slialt not steal," has no legal force upon the sovereign body. And there would be no necessity for compensation to be given. We have no such restriction upon the power of the Legislature as is found in some States.
Clearly, then, we are in a position where, if Ottawa persists in one course with respect to taxation, and the provinces persist in another course, there could be confiscation of all the earnings of the companies involved in producing natural resources.
The reason we in Ontario are concerned about this is that we believe, as I have indicated, that the first priority we must insist upon is security of supply. Surely it behooves this government and the provincial governments in the oil producing provinces to come to an agreement on the mode of taxation so that developers and resource companies can ensure we have sufficient resources in future years to enable Ontario and the rest of the country to continue their productivity without letup.
In this respect I think it is very easy for us to deal in figures of $6.50 per barrel, or $10 per barrel, or $8 per barrel, without realizing that as one of the main consumers the province of Ontario will be done irreparable harm unless there is a satisfactory reconciliation between the oil producing provinces and the federal government. Already the effects of the recent price increases are being felt dramatically in Ontario in terms of inflation and employment. I urge the members of this House to press the government to reconcile this question quickly, and on a satisfactory basis, so there is a minimum of consternation in the coming months.
In this regard I believe that the bill should be dealt with in committee of the whole so as to give ample opportunity to all members of the House to question the minister and his officials on any aspect of the bill about which they feel concern. Perhaps in this way we can get to the facts and satisfy ourselves that in truth the federal government is making an earnest attempt to satisfy all parties. Thus the Canadian consumer-and I speak as a resident of Ontario-will suffer minimum hardship.
In conclusion, I believe insufficient discussion has been conducted between the provinces and the federal government on this issue. I believe it is wrong for the government to assume that an agreement which was originally for a period of 15 months should now be embodied in an act of parliament without further consultation with the provinces to ensure that this is their wish. We are dealing with perhaps one of the most important subjects to come before this session of parliament. I hope all members will take a deep interest in it, that the government will stop being so bull-headed and will try and work out an agreement that is mutually satisfactory both to the producing and to the consuming provinces.


William Gordon Ritchie: Mr. Speaker, we are again debating a bill that had a trial run in the last parliament and is now before the House with the addition of some clauses. At this stage I think it is wise that we, as
November 4, 1974

a nation, take a look at our oil and gas position, and at the prospects not simply for the immediate future but for some years ahead. Perhaps this will be the last time this question can be debated in the House, unless it can be raised again when we are debating PetroCan.
It seems to me that this bill perpetuates a very comfortable, but short-sighted, situation. We are keeping our oil prices low for the next two or three years and encouraging consumption, while at the same time discouraging exploration and development of other oil and gas fields. As a result there is a movement of drilling rigs out of Canada. While the United States is increasing its exploration activity and its financing of oil and gas development, we in turn are decreasing our activity. As I say, we are encouraging consumption by keeping the price of our gas and oil below the world price.
At the same time the government is attempting to create one uniform price all across Canada. This poses great problems, and as oil and energy are interchangeable and can be replaced with electricity, coal, wood and other forms of energy, we are not allowing the market price to set priorities. Thus we will end up with abnormal strains in the industrial and financial part of our economy when we finally must reach world market levels.
Again this bill is a direct intervention in provincial affairs in that it attempts to wrest from the provinces the right to control their resources and sell them at the best prices available. The thrust of this bill is interesting in that it intends to pillory the western provinces in favour of central Canada. The Prime Minister (Mr. Trudeau) has carefully prepared the way by appointing to the supreme court individuals who are biased against the provinces, and particularly western Canada.
What about energy savings? At a time when the world is saving energy Canada has the enviable or disreputable distinction, whatever you would call it, of experiencing an increase in the use of gas oil in the 1970's. Contrast this with the United States which has enormous natural energy supplies which in the long run will likely be cheaper than ours.
President Ford indicated in Washington that if his voluntary energy conservation program is unsuccessful he will take stronger action. He wants to have one-million barrels a day reduction in oil imports to the United States, and has said that he will move to any other alternative, including the possibility of mandatory limitations to achieve that result. This clearly indicates what lies ahead for U.S. consumers. The public is being given a chance to find its own way to conserve energy.
Voluntary programs of this type have a poor record of success. When they are judged to be failures there will no doubt already be a reduced availability of gas at the service pump, and this will be followed by the introduction of a system of priorities in respect of access to supplies, perhaps with tax devices designed to discourage heavy consumption.
To this government and Canadians generally who are enjoying temporary easing of oil prices because of ample supplies, the United States problem may seem remote. Canadians are fond of telling themselves that, on balance,
Oil and Petroleum
their country is self-sufficient in oil. This complacent attitude could lead to difficulty within three or four years and, unless Canadians think seriously about energy conservation, mandatory limitations such as those threatened by President Ford may have to be introduced in Canada.
The president of Shell Canada Limited has said that the production of crude oil and natural gas liquids from known reserves in Canada will begin to decline by about 1978, just four years from now. He also stated that if the demand continues to increase at its present rate Canada could become a net importer of oil before 1978. He went on to say that in the short term there is not much that can be done to increase supply.
The president of Shell also noted that the rate of growth in the demand for all types of energy in Canada increased from 4 per cent per annum in the 1950's to 5.5 per cent in the 1960's. As we become more mobile, more electrical and more automatic we become more energy inefficient. Most observers feel that in the long term, given significant development of the oil sands and of reserves in the frontier regions, Canada should be able to remain essentially self-sufficient in oil and natural gas, providing we espouse a conservative ethic now.
Conservation to many authorities means reducing the consumption of oil and gas liquids from the recent annual growth rate of 5.5 per cent to 6 per cent back to the 3.5 per cent to 4 per cent of the 1950's. This should not mean a change in the lifestyle of Canadians. Nor will it mean an absolute decline in consumption. However, when we are debating such things as an open-door policy on immigration, through which we could have a flood of immigrants who would certainly increase demand on energy resources, we must remember that this could well pose severe strains on our energy resources.
This change in lifestyle has been studied in the United States. The Ford Foundation has released the results of its $4 million energy policy project. The Mobil Oil Corporation criticized the low or zero growth recommendations contained in that report. We are now debating whether we should substitute small cars for large cars, how we should heat our houses in the winter and how we should cool them in the summer. I think it is often forgotten that one of the things that has made the lifestyle for Canadians much better in the last three decades has been the increased use of energy in heating homes and in transportation.
Transportation is the greatest area in which inefficiencies in energy use are to found. Air travel requires 10 times as much energy as buses, six times as much as trains, and four times as much as cars. Many industries could use coal instead of natural gas, yet this bill will allow natural gas to be sold indiscriminately at considerably lower than its market value.
This bill will increase the tendency for increased consumption of oil and natural gas, because those energy sources will continue to be priced below the world market. There is no valid argument against the suggestion that in a country such as this, with relative sufficiency, we can prevent unnecessary hardship to our consumers. However, there is no use burying our head in the sand, as this bill would imply, by saying there will be a gradual rise in oil prices to meet the world level. It should be made obvious

November 4, 1974
Oil and Petroleum
that there must be a gradual increase in oil prices to the consumer to somewhere near the world level, and we should be given details as to when this will occur.
Let me turn for a moment to what our energy possibilities are in the short run. When Premier Lougheed, the premier of Alberta, Canada's major oil producing province, after meeting with the Prime Minister stated that he was apprehensive of an energy shortage in Canada in a decade, I believe that his comments should be taken with considerable importance. Other people in the oil industry are forecasting that oil production could start to decline at the end of this decade. It has been widely quoted that on the latest data regarding performance of oil fields operating at peak levels-and this has been the case for the last one and a half years-the outlook is even more sobering.
By 1983 it is likely that Canadian production will be able to supply only Canadian areas it has served traditionally, that is, west of the Ottawa Valley. This would be of great significance in terms of Canada's balance of payments. It seems likely that by 1983 or 1984 this could account for a deficit of several billions of dollars.
It is also considered that by the latter half of the 1980's production from Canadian sources will again be more than enough to supply the traditional domestic market. It is widely considered that even if exports stop, the peak provision capacity will only be increased by three or four years. To cut off exports we would have to balance the effect on foreign exchange and on over-all foreign relations between the United States and Canada, as well as the effect on the income of producing provinces through the service industries. We would have to take into account the fact that exports generate cash for future development.
We in this country have been lulled into a feeling that the oil sands will provide unlimited supplies of cheap energy, but all indications are that this recovery of oil will be slow. One plant capable of 100,000 barrels per day capacity in the tar sands, coming on stream every two years, is considered to be all that can be expected. One oil company president has stated that it is doubtful if more than one major plant can be built in the Athabasca oil sands every two years.
A major plant now under construction is intended to start producing 125,000 barrels a day of synthetic crude in 1977. The president of that company stated that the one clear signal to the consumer that the days are over when energy supply can be taken for granted would be if we were to allow the price of petroleum and of other forms of energy to find their proper market value.
There has been a widespread feeling that oil companies have been making too much money or too high a percentage of profit. Surely it would be better to devise a means of taxing profits when prices rise, particularly if they are too high in the present situation, in order to keep the price down as a means of limiting company profits.
We are now debating whether we should extend the Montreal pipeline. In my opinion this is one move that we should not make at this time. Obviously Interprovincial Pipeline is not happy with the possibility of building that pipeline. Indeed Interprovincial seems to feel that it needs further government guarantees before it will embark on

the project. Apparently the Minister of Energy, Mines and Resources has stated publicly he believes in an adjustment in the tariff for all customers along the Interprovincial pipeline from Edmonton to Toronto and Montreal, and that in the end-it would be a better way to build a pipeline with an additional capacity of 250,000 barrels a day whether or not oil is available to the pipeline. In other words, those involved in the oil industry are not really sure there will be any oil to place in the pipeline even if it should be built.
This extension of the line to Montreal, which market is now served by foreign crude, is central to the policy of self-sufficiency announced after the oil embargo. Montreal obtains its oil mostly from Venezuela, while the Maritimes are served by the Middle East. A capacity of 250,000 barrels a day would fall far short of the requirements to meet eastern needs.
A more important consideration is that Interprovincial clearly has doubt concerning the availability of oil for a period of 20 years. Interprovincial raises the point whether the limits on resources are now becoming clearly visible.
What about the tar sands? Shell Explorer, the Canadian subsidiary of American Shell, wants out in respect of its half of the Shell Canada tar sands development because it doubts it can achieve an acceptable rate of return for the $500 million it would have to invest. The doubt arises from the expanding government control over the petroleum industry, which emerges from different events such as the federal-provincial tax conflict and the adoption of a policy of self-sufficiency.
It might seem to those people who want Canadians to own the oil industry that here would be an excellent opportunity for Shell Explorer to sell its share to some Canadian company, but an amount of $500 million is no mean investment for Canada at this time.
There have been frequent headlines in the papers in connection with this situation. These headlines point out, for instance, that droves of drilling rigs are leaving. This emphasizes what has been happening in respect of the exploration industry. Drilling activity has been reported at 10 per cent below the 1973 level, with the sharpest reduction in Saskatchewan, at a time when it should be expanding. As well, production in Saskatchewan has gone down by 73,000 barrels a day from a year ago. Mr. J. G. Wotherspoon, Saskatchewan Deputy Minister of Mines, stated that medium crude has been priced out of the American market. It was the export tax that priced it out, Mr. Speaker.
Alberta production is down 200,000 barrels. This reduction has come about because of the disinclination of Americans to pay the export tax in total. Unfortunately it has had its heaviest effects on the types of crude that we have in the greatest quantity, the heavy oils of Alberta and Saskatchewan.
The question of the Montreal pipeline should be looked at again. Last winter the industry found it could move one-quarter million barrels a day into eastern Canada via the Panama Canal and by the Great Lakes. We might well consider this for the future. I think the security offered by this route is adequate. Indeed, instead of spending all this

money on an interprovincial pipeline the money could be spent for the development of reserves in the Alberta tar sands, and the pipeline could be proceeded with later if there should be any oil to fill it.
What are the chances of the world price of oil being reduced in the next few years? They do not seem very great, although there are a few hopeful signs around the world. In today's paper it is reported that the Shah of Iran has said he would seek a 14 per cent cutback in oil prices, but he coupled with that statement an argument that the oil companies are making too much profit. I suspect he is only trying to cloud the issue, because the substantial part of oil profits finds its way into the coffers of some governments around the world.
Officials of the British Petroleum Company in an interview in Montreal suggested that it is clear the world can produce energy from a number of sources, beginning early in the next century, at rates as prolific as those of the energy-rich years of the 1950's and 1960's, although at substantially higher prices. They went on to say that some countries such as Canada, and Britain with its North Sea oil, could be shown on paper to be able in theory to achieve self-sufficiency in respect of energy.
But it seems likely that pressures, some of them related to resource technology as well as the resources themselves, will be such that no country should really consider itself self-sufficient. Canada is part of the North American continent, and we should not attempt to isolate ourselves from the United States in respect of energy. The natural flow is north-south in the great plains of North America with regard to gas and oil.
The Minister of Energy, Mines and Resources has flatly rejected any sharing with the United States, but the Prime Minister (Mr. Trudeau) has just returned from France where, among other things, he explored the possibility of expanded trade in which Canadian oil, coal and uranium could be substantial elements. I always thought these were part of the energy package. The Prime Minister no doubt wishes to break down some of the dependence of Canada on the United States market. This is not the first time a Canadian Prime Minister has wished to do this. However, the United States generally is in a position to return a greater trade advantage than could be had from Europe.
Canada at the present time does not need access to the United States market as it did previously. There are now genuine shifts in energy sources in the U.S. This, together with control of wastage and a desire to strengthen conservation measures, all combines to restrain demand. The principal strength of the United States is its capacity to organize and focus money and expertise in a manner peculiar to it.
Although the United States is now involved with conservation it will find new sources of energy. Indeed the world must find new sources if it is to exist. Canada could be the loser if it denied itself access to United States technology.
This bill does not provide any method by which the provinces can work out their taxation problems. We are awaiting with interest what this month's budget will contain in an attempt to heal the wounds of the May 6 budget.
Oil and Petroleum
In the May 6 budget the federal government obviously declared war on the provinces which were producing oil and gas. The disallowance in the budget of May 6 of the provincial tax or royalty as an expense effectively placed those resources under the federal government. In western Canada this caused a growing realization of alienation. It will strengthen the idea which is gaining ground in the west that the west should adopt a much more independent position in the Canadian federation. If the resource industry is to settle down, the federal and provincial governments must come to some agreement.
The petroleum industry of Canada has pointed out that at the new Alberta crude oil price of $6.50 per barrel, and under current royalty and tax rules, sufficient cash flows are available for an additional 77 cents per barrel investment in the search for new petroleum energy. The industry also points out that the May budget proposals would have taxed away an additional $1.30 per barrel from the Alberta oil industry. The industry would suffer a loss on Saskatchewan oil production. It is obvious that there is a need for re-examination by the federal government of its tax sharing policy so that Canada will be better able to generate the capacity necessary for resource development.
It seems that much will have to come from the reinvestment by the energy companies themselves, and this will require tax regulations which would allow for a reasonable return and, at the same time, for a contribution to over-all exploration and development. There are those who believe that governments should do the investing, but all indications are that governments tend to be inefficient and prone to overkill in their control of oil companies whose profits are proverbial. It seems to me that outright government intervention and management should not be condoned when the industry can be controlled just as well by taxation and regulation.
In closing I should like to say that this bill perpetuates a principle that is wrong in that it encourages consumption and discourages conservation, exploration and the development of new oil and gas resources in our country. In the long run this will cause serious problems.


Mr. Cyril Symes (Sault Ste Marie):: Mr. Speaker I welcome the opportunity to say a few words on Bill C-32, the petroleum administration measure, which is designed to impose an export charge on crude oil and natural gas to compensate the oil companies, and to regulate the price of oil and natural gas.
Listening to the comments of some of my friends in the Conservative and Liberal Parties it seemed to me that the old adage of "play it again, Sam" it put into practice because in the last parliament, the twenty-ninth parliament, we dealt with many of the same issues in what was then Bill C-18. The problem of energy in Canada has not gone away, is still with us, and it stands as a testimonial to the failure of the Liberal and Conservative federal governments to design a national energy policy to benefit Canadians.
I think it is important that in our discussion and analysis of this bill we turn our attention to what should be the components of a national energy policy. I should like

November 4, 1974
Oil and Petroleum
to outline what we in the NDP believe are some of the essential elements in such a policy. First and foremost, we must come to grips with the issue of control of the petroleum industry in this country. For far too long we have welcomed with open arms, and without any real consideration of the long term implications, the multinational oil companies coming into Canada to develop our energy resources. As a result of that lack of forward looking policy in terms of what it means to Canadian control, we now find that 91 per cent of the oil industry here is foreign dominated. With respect to oil refining, foreign domination reaches 99 per cent. Is it any wonder then that there is a lack of a national policy that would benefit Canadians, and that instead the benefits are going to the multinational oil companies, most of which are based in the United States?
Let us look for a moment at what has been the policy of the multinational oil companies. First, their policy has been to export Canadian oil to the United States, and the more they can export, the higher are their profits. So it has been traditional in this country for us to get as much oil as possible out of the ground and to give it to the United States as quickly as possible. Therefore, for those oil companies the future supply of oil for Canadian needs has always been of secondary importance.
The second result of this lack of control over the industry by Canadians has meant that multinational oil companies have tried to charge the highest price possible. In other words, the cost of a barrel of oil or a gallon of gasoline is not based on the cost of production.
As the vice-president of Imperial Oil said last year in testimony before the Nova Scotia government, it is the policy of the oil companies to charge what the market will bear. When we analyse this-and the Americans have done this-we find that it costs the American oil companies, if my memory serves me correctly, about 6 cents to produce a gallon of gasoline. In other words, the idea is that the sky is the limit, and what you can get away with is perfectly all right so far as price is concerned.
The other element or trend in our energy policy here, because it is controlled by the multinationals, has been the movement toward a continental energy policy whereby Canada would continue to be the supplier of the raw material, and would ship it to the United States where it would be processed and manufactured into other products. So long as the policy continues that we must export our raw materials, of course we are exporting jobs, because where the jobs are created is where the raw materials are further processed and manufactured. Historically that has taken place outside this country.
Therefore it is the belief of the NDP that it is important to reserve this trend of the foreign domination of our oil industry, and to do that we propose a number of steps. The first is to have a national petroleum company. During the minority parliament we pressured the Liberal government as best we could to move in that direction, and indeed the minister does have a bill on the books. When you look at the bill for the creation of a national petroleum company you find that it looks pretty good on paper, but the question is: will all the powers in theory allocated to that company be in fact used?

What we want to see is a national petroleum company that will enter into all phases of the industry, into the exploration, the development and the refining of petroleum products. I do not have visions of people such as the Minister of Supply and Services (Mr. Goyer) managing such a company. Obviously we would go where the expertise is, we would contract out to those with such expertise. But the point is, if we had a truly national petroleum company-


An hon. Member:: How about multinational managers?


Reginald Cyril Symes: No, but we could contract out to Canadian well drilling companies, of which the hon. member from Calgary is one of the leaders. We would have a national petroleum company which, by getting involved in the oil market in Canada, could be a pace setter with regard to price, exploration and pipeline policy in this country. I think that is an essential first step.
This national petroleum company could also serve another very useful function, in view of the fact that we in eastern Canada are still dependent on imported oil. This company could buy oil directly and sell it directly to foreign governments, thus avoiding the multinationals and all the rip off in fees and profits that that entails. In other words, a national petroleum company Canadian owned and directed could strike the best deal for Canadians in terms of buying and selling oil.
It is very interesting to note the current wprld situation, Mr. Speaker. A few days ago in the Standing Committee on National Resources and Public Works, the Minister of Energy, Mines and Resources (Mr. Macdonald) admitted that in effect Canada can be blackmailed by foreign governments that have multinational head offices within their jurisdiction. We were discussing a proposed international oil agreement when this little tidbit of information came out, Mr. Speaker. This seems to me a frightful admission of a lack of Canadian sovereignty in an area vital to the survival of our economy. A national petroleum company would be the beginning of control of the industry; it would lessen and eventually end the domination and threat of blackmail by multinational oil companies.
It would be important to have a national petroleum company deal directly with foreign governments, especially oil producing governments, in light of what is taking place in the Middle East at the present time. We read in this morning's paper that the Shah of Iran is seeking a 14 per cent reduction in the posted oil price. He pointed out, however, because of our present dependence on the multinational oil companies, that there is no guarantee that the reduction would be passed on to the consumer.
Saudi Arabia has proposed a plan that would make crude oil cheaper for a national petroleum company dealing on a bilateral basis with that country and other oil producing states.
It seems to me, Mr. Speaker, that to even the most rabid capitalist the concept of a national petroleum comapny has some merit in our present situation.


An hon. Member:: No way!
November 4, 1974


Reginald Cyril Symes: I hear some noes from my friends on my right, so there are still a few diehards there. They are to be commended on their principles and sincerity, but they are still living in the nineteenth century. We do not have the free market that they assume we have still.
If we are to have a national energy policy, Mr. Speaker, we can no longer allow Canada to remain at the mercy of the pricing and supply policies of the multinational oil companies. We must move toward government control and ownership, and view all forms of energy as we view electricity now-a public utility. We cannot allow wasteful private competition in the energy field.
The second essential element to a national energy policy is to ensure security of supply. At the present time in Canada we are self-sufficient in oil, but because of past Conservative and Liberal government policies we do not have an oil pipeline to eastern Canada from the western oil fields. As a result eastern Canada has to import oil and consequently the country has been caught in the tremendous inflationary spiral caused by the crude oil crisis.
We are faced with some frightening prospects in the near future, Mr. Speaker. Canada currently produces
2,003,000	barrels of crude oil per day. In Canada 1,751,000 barrels a day are consumed, and 1,206,000 barrels per day are exported. We import 949,000 barrels per day. I studied oil company figures, independent studies and National Energy Board figures. We do not have the latest report of the National Energy Board, which is a shame, and I think the minister is concerned about that as well.
The latest predictions of oil availability and demand, however, indicate that Canada will no longer be self-sufficient by 1979-only five years away. Canada's oil production is declining, yet we are still exporting oil to the United States at an incredible rate because of a lack of government intervention and because of foreign domination of the industry.
At the same time that oil production in western Canada is declining, demand is increasing rapidly. Any sane, logical person must ask why we continue to export oil when predictions are that we are running short and will have to import more expensive oil from Venezuela and the Arab states.
There are many answers, Mr. Speaker. In the past the National Energy Board consistently has been over-optimistic about future supply. It has accepted oil company figures, and it is to the advantage of the oil companies to be optimistic about supply in order to encourage exports. There is no pipeline to eastern Canada as an alternative to the demand of the United States market, and consequently the exports go to the United States. There has been consistent pressure on the Canadian government and the National Energy Board from multinational companies to commit ourselves to exporting oil.
Another reason why we do not cut back on exports to the United States is that since we have had the current world crisis and the price has gone up, the Canadian government has become dependent on revenues generated by the export tax to compensate consumers in eastern Canada in order to keep their oil price below the high world level. The policy of continuing to export under these circumstances is self-defeating as we run short of domes-
Oil and Petroleum
tic oil. Exports will decline, export tax revenues will decline, and meanwhile the demand for imported oil in eastern Canada will continue to increase. Where is the money to come from to compensate the oil companies and to keep the Canadian price lower than the world price?
The government has two options, Mr. Speaker. First, in the years ahead it can compensate the oil companies from general tax revenues. That means each and every Canadian will have to pay more in taxes in order to have a lower price in Canada than the world price. Or secondly, the government will have to let the price of oil in Canada rise to world levels.
The implications are astounding in terms of what that would do to inflation in this country. Every day our constituents complain about increases in the cost of food, clothing and other essential items, but if we were to let the price of Canadian oil rise to world levels they would see what inflation really means. Energy is the essential component to our total economy; if energy costs go up so do costs in every other area.
When we look at demand and production in this country, the future is not promising. In 1979 we will lose our self-sufficiency. In effect, we will be in a deficit position of 101,000 barrels per day, and by 1984-a year that has some other connotations-we will be in a deficit position of 970,000 barrels per day, and will have to import oil from the Arab states and Venezuela at a higher price.
Given this evidence, that we are losing production in the west and demand is going up, it seems to me imperative to begin to reduce substantially exports to the United States. The minister says the government is considering this, and that it may be a possibility. He is admitting that it may be in Canada's interest to cut back somewhat our oil exports.
I remind the House that the Standing Committee on National Resources and Public Works has another item before it. It is called an international oil agreement, and is an agreement between 11 consuming countries, of which Canada is to be a member. This international oil agreement is a 10 year treaty. It is important to note that in this treaty the United States has a voting mandate of 53 votes and Canada only has a voting mandate of nine votes.
Under the terms of this treaty, which the Canadian government seems ready to ratify, if an international oil emergency develops, that is, if there is a shortage in any of the 11 importing countries, Canada is then committed to continue exporting oil to the United States at its current rate of export.
The implications of this agreement are indeed serious if we are determined to cut back our oil exports to the United States. If we get into an emergency situation, Canada will lose control of cutting back exports to the United States. Conceivably, Canadians would have to undergo cutbacks and rationing to serve the U.S. market. We need to take a closer look at this proposed international oil agreement. I looks like the beginning of a continental oil policy.
In terms of security of supply, in addition to cutting back exports to the United States it is essential that we begin to build an all-Canadian pipeline to eastern Canada.

November 4, 1974
Oil and Petroleum
This pipeline should go from Manitoba through northern Ontario to Montreal and the maritimes. I advocated this on many occasions in the last parliament. The answer the minister gave me on why we could not build an all Canadian line was that it would take a year extra to complete over the proposed Sarnia-Montreal pipeline. We now have delays in the Sarnia-Montreal pipeline to the point that these delays equal the one year extra it would have taken to build an all Canadian route.
I also argued with the minister in the last parliament about the value of a Sarnia-Montreal pipeline as opposed to extending the existing pipeline from Toronto to Montreal. The minister argued we needed the Sarnia pipeline because it could carry 500,000 barrels a day. Now that pipeline is supposed to carry only 300,000 barrels a day, and Interprovincial is not even sure it can handle that. With an all Canadian pipeline, we would have the opportunity to open up a petrochemical industry in northern Ontario. More important, we would have a means of getting cheaper western Canadian oil to our eastern market, and we would be secure in knowing that it traversed only through Canadian territory. This again raises the issue of security.
I am astounded to realize that the Canadian government is now negotiating with the United States about the security of supply through pipelines. I always assumed we had a treaty with the United States guaranteeing security of supply for the pipeline that leaves western Canada via Alberta and Manitoba, goes to Chicago, and links up with Sarnia again. There is also a pipeline from Portland, Maine, to Montreal.
The Minister of Energy, Mines and Resources now tells us we are negotiating with the United States for guaranteed security. Meanwhile, what do the Americans want? They want an oil pipeline and gas pipeline through the Mackenzie Valley. The implications are serious.
Our pipelines going through American territory are not secure. The Americans are in a tremendous bargaining position to argue they should have a pipeline down the Mackenzie. It really amounts to blackmail. An all Canadian route would certainly avoid that difficulty.
If we are to have guaranteed future supply we must begin to develop the Athabasca oil sands. We must do this on a concerted and energetic basis. In the last parliament the minister repeatedly said the Athabasca oil sands were the great salvation of Canada. It was a secure supply. We had to develop the plants, get them on stream and into production because of the time lag involved. I do not hear the minister touting the Athabasca oil sands as the great salvation any longer. It is important that we understand why there is this sudden silence.
Here is a golden opportunity for Canada to move toward self sufficiency. We have an opportunity at this time due to the fact that in one of the proposed developments of the oil sands one of the private multinational companies is pulling out. Here is an excellent change for a government national petroleum company to step in as one of the partners to develop the oil sands under Canadian terms, for the benefit of Canadians and not for the export markets in the United States.

In the last parliament we asked for a 50/50 split of the export tax between the provinces and the federal government so that the provinces could have extra revenue to help develop, along with the federal government, energy projects such as the oil sands. This was not accepted. Under the current export tax there is a surplus of some $200 million this year. I wonder what the federal government will do with that surplus. Is it going to turn it back into energy development? It is important that we have answers to these questions.
Another way we can begin to move toward ensuring a supply of oil for future Canadians is for the Minister of Energy, Mines and Resources seriously to advocate to Canadians the value of conservation of energy. I do not mean turning out the lights around Parliament Hill. We have to get Canadians to think conservation because, as I said, we are moving toward a lack of self-sufficiency within five years time.
It is interesting to note that the growth in demand for energy in Canada during the 1950's was 4 per cent per annum. By the 60's, the demand had grown to 5.5 per cent. Canadians consume energy at a rate five times higher than the world average.
This government has a responsibility to initiate energy saving policies in areas such as higher insulation standards for new homes. We need to encourage mass transit via bus and train. In terms of passenger miles, planes require 10 times as much fuel as buses, six times as much fuel as trains, and four times as much fuel as cars. Yet the Minister of Transport (Mr. Marchand) is going full speed ahead with STOL, the short takeoff and landing aircraft. He should be putting more money into mass transit via train and bus.
To promote conservation the federal government should be urging the provinces to reduce highway speed limits to 50 miles an hour. A car uses between 15 and 25 per cent more gasoline at 70 miles an hour than at 50.
If the minister had the courage to urge Canadians to turn down their thermostats four degrees, we would save the equivalent of 900 million gallons of fuel oil a year, about 10 per cent of the energy used in heating. We should also begin to phase out the use of natural gas to produce electricity because it is so inefficient when used that way. Further we should discourage the use of electricity to heat homes because more energy is expended in producing electricity than is warranted when we consider the ratio of electricity needed to heat homes. Those are some positive steps the government could take to move toward a position of security in future oil supplies.
A third element of a national energy policy surely must be a pricing policy to benefit Canadians. In the last parliament, and even before, the New Democratic Party advocated a two-price system in oil. That is to say, Canadians would pay a lower price than the world price, and we would export our oil at the higher world price. As a result of that policy which was accepted in the last parliament, Canadians save approximately $5.20 a barrel for crude oil. However, we still got caught in an increase of sorts because the price of oil to the Canadian consumer had to go up in eastern Canada because there was no pipeline from the west. We had to import foreign oil.

To keep the price down to consumers the government said it would absorb the difference in price between what people were paying in eastern Canada, the world price, and what people were paying in western Canada, the Canadian price. The money would in turn be given to companies operating in eastern Canada to keep the price down.
To date the government has given some $900 million to the oil companies in compensation payments. I maintain this is a rip-off of the Canadian consumer when we consider what company profits have amounted to this year. It seems to me, in the light of these profits, that the companies could well afford to absorb a greater share of the increased cost of the oil imported into eastern Canada.
Let me give the House a few examples of oil company profits. The after tax profits of Gulf Oil in 1972 amounted to $64.2 million. In 1973 profits rose to $101.7 million, an increase of 58 per cent. In 1972 the profits of Imperial Oil amounted to $157 million. By 1973 they had risen to $228 million, an increase of 45 per cent.


Harvie Andre: That is a return on capital investment.


Reginald Cyril Symes: Moreover, for nine months since 1973, Imperial Oil profits have shown a further increase of 64 per cent. The figures for Shell this year are equally remarkable. In 1973 Shell showed a profit of $60 million; in 1974 the figure is $119.5 million, an increase of almost 100 per cent. Yet we are giving $900 million a year to these oil companies!
Even more striking than figures I have just quoted are some figures here which, so far, have not been brought out in this debate. They show the profits of these companies as a percentage of revenue. With respect to Gulf Oil, profit as a percentage of revenue in 1969 was 6.8 per cent. By 1973 the figure had risen to 9.6 per cent. For Imperial Oil in 1969 the figure was 6.2 per cent; in 1973 it was 8.6 per cent. This means that despite the export tax, despite the corporate income tax, our tax system is still allowing the oil companies to keep a larger proportion of their revenue. I argue that the oil companies cannot plead that they lack funds for exploration. They are very healthy indeed, healthy enough, in my opinion, to absorb some of the higher costs of imported crude.
In conclusion may I repeat that Canada is approaching an energy shortage which will become evident in four or five years. A serious crisis is coming and we, as members of parliament, must bear the responsibility to act in a meaningful, constructive and responsible way to meet this crisis. We must develop a national energy policy embodying public control to achieve three things: Canadian control of the oil industry, security of supply, and fair prices for Canadians along the lines I and my party have suggested.


Jack Sydney George (Bud) Cullen: Thank you, Mr. Speaker. I had not intended to take part in this debate.


Some hon. Members:: Oh, come on!
Oil and Petroleum,


Jack Sydney George (Bud) Cullen: The bill is a good one and I think it is necessary. As the last speaker mentioned, we have been over this ground again and again. I sometimes wonder, though, whether members of the opposition have ever taken time to read the bill and, if so, whether they have come to any conclusions about it.
Perhaps it would be useful if I were to remind hon. members that it concerns a charge levied on the export of crude oil and certain petroleum products to provide compensation for certain petroleum costs, and to regulate the price of Canadian crude and natural gas in interprovincial and export trade.
I have been waiting to hear from hon. members opposite either support for this proposition or opposition to it. Instead, I hear the hon. member for Dauphin (Mr. Ritchie) telling us there is no point, now, in building the pipeline from Sarnia to Montreal. Five minutes later the hon. member for York-Simcoe (Mr. Stevens) tells us that not only should it be built but that it should be reversible so that should the price of offshore crude go down, or supplies be found off the east coast, we might be in a good position to take advantage of these circumstances. So, we hear two differing points of view.
From the New Democratic Party we hear speakers hashing over the idea of an all Canadian pipeline to meet an emergency situation. Is it any wonder that the government must show leadership and bring forward a bill which speaks, not for Alberta or for Ontario, but for Canada? I listened to the hon. member for Calgary Centre (Mr. Andre), and I listened to the usual harangue by the hon. member for Calgary South (Mr. Bawden) that royalties should be allowed as an expense of doing business. However, neither of them indicated what amount of royalty they thought was reasonable.
When the price was frozen at $4.00 a barrel, the provinces and the federal government got together and arrived at a figure of $6.50 a barrel which was felt to be in the common interest of Canada. It was a little less than Alberta wanted for its crude, and it was a little more than Ontario wanted to pay, but it was a compromise worked out to deal with the situation. What was the reaction of the provinces? Saskatchewan felt that the oil companies did not need the extra money and decided to take the whole of the $2.50 increase. Alberta, if I am not mistaken, took between 65 and 70 per cent.
The Prime Minister (Mr. Trudeau) indicated prior to his meetings with the Premiers of the western provinces that they should not try to take all of that increase and call it a royalty, and that if they did it would not be allowed as an expense of doing business. This was a reasonable position for the Prime Minister to take. He stated it early on so that the provinces would be aware of the federal government's position. Fortunately we had the strength to maintain that position, and when the producing provinces took the action they did, the federal government had no alternative but to say that it is not a royalty, that this is a total intrusion into another tax field, and it is not a legitimate royalty to be allowed as an expense of doing business.
Negotiations now have to take place to determine what, in effect, is a reasonable royalty. I make no secret of the

November 4, 1974
Oil and Petroleum
fact-indeed, I spoke about this publicly during the campaign-that the oil companies should be allowed a reasonable royalty as an expense of doing business. Whether or not such a compromise can be worked out I do not know, but at this point in time to suggest that $2.50 of an increase, or 65 or 70 per cent, should be the royalty, is begging the question. That is why the federal government took the action it had to take.
Once again we have the selective memory of the opposition parties when they say the government has been lacking in leadership. I suggest they are really choking on that particular expression. They tend to forget that the price of oil per barrel in the world was quadrupled and, as a result, we had to meet an emergency situation. We did this in several ways. We did it by delivering the oil in a way which the hon. member for Dauphin (Mr. Ritchie) said was so successful that he wanted it adopted as a permanent way of moving oil from the west to the east, namely, by ship, train and any other way. So that operation must have been comparatively successful, Mr. Speaker.
The position of the federal government is that we want a one-price system for oil in Canada, give or take a few cents to allow for transportation costs. Is the opposition suggesting that this is inappropriate? If it is, then hon. members opposite should stand up and say so. It seems to us that having a two-price system is a good move. We should have one price across Canada within the limits that I have indicated, and then impose an export tax, which is a legitimate tax, on oil we ship outside. This money would not be used to fill the government's coffers.
There is a surplus of $200 million now, but I have not heard any member say how that money should be spent. They view it with suspicion, and wonder what the federal government is going to do with it. Surely these members have an obligation either to say they approve or they disapprove on the second reading of this bill, which is approval in principle.
Then I hear opposition members harping on the fact that the minister suggested that one option open on the Mont-real-Sarnia pipe line was that, in order to pay for the capital cost of the line, a flow through charge should be made to users. With respect, that is one option that must be considered. Another option is that Interprovincial Pipe Line go ahead and build the pipe line as they were going to in the first place. Another is that they get a guarantee of a flow through charge, with the federal government picking up any shortfall in amount. Yet another option is that the federal government build the pipe line, or that the federal government build the pipe line and sell it back to Interprovincial. There is a whole series of options which surely must be examined.
Much has been made of the fact that we were confronted with an emergency situation, yet construction of the pipe line has been delayed. It has been held up because the National Energy Board saw its responsibility. It knew this was an emergency situation, and it also knew that there was apprehension in the province of Quebec about environmental damage. So the board told Interprovincial Pipe Line to find another route, that it did not feel it could approve the present route. As I say, the National Energy Board saw its responsibility and had the courage and good sense to do what it did. Surely it has a responsibility to

tell provincial pipe line companies where to build their pipe lines so there is as little impact on the environment as possible.
I suggest to the hon. member for Calgary Centre that the most ridiculous suggestion I have heard tonight in this debate is that we should withdraw clause 36. Somewhere down the line the federal government has to take its responsibility. It is endeavouring to negotiate, for the people of Saskatchewan and Alberta, a price for their oil. If this cannot be negotiated, would not the opposition be justified in saying to the government that it has reached the stage where it cannot come to any kind of settlement, so why not introduce legislation to set the price?
This bill does not set a price unilaterally. There are all kinds of opportunities, both for the consuming and the producing provinces, to negotiate a reasonable price. But if this cannot be done surely the federal government must take its responsibility.


Gerald William Baldwin: That is price control. I thought you were against that.


Jack Sydney George (Bud) Cullen: One thing we would have liked to control was the amount of money the Conservatives wasted in the last election, but we could not do that.
I have indicated my support for the bill, Mr. Speaker. I think we are rehashing a lot of debate that we have already had. Questions have been asked tonight about what is going to happen to the $200 million, and I think these questions can be answered in the committee. Perhaps we will even get some suggestions from the opposition about what we should do with the money. What portion of the price of a barrel of oil should the oil company get, what portion should the producing province get, and what portion should the federal government get? We have not heard any suggestions in this regard from the opposition parties.


Gerald William Baldwin: There is lots of time; we have another week to go yet.


Jack Sydney George (Bud) Cullen: I hear what the hon. member says from his seat, but since he is not participating in the debate I will take that for what it is worth. In my view this bill should go to the committee, receive careful scrutiny and then pass. To suggest that clause 36 should be eliminated, thus depriving the federal government of its leadership role, is an inappropriate suggestion for any federal parliamentarian.


Mr. Bob Brisco (Kootenay West):: Mr. Speaker, the Minister of Energy, Mines and Resources (Mr. Macdonald) has given us a studious commentary on Bill C-32. The areas of this bill with which I agree are already clearly on the record, and they have been placed there by other members of my party. Similarly, other members of my party have clearly defined their areas of stern disapproval. Those areas of disapproval were voiced a moment ago by the previous member who was quick to praise clause 36, to which I should like to come in due course.
Let me for a moment, however, examine the closing statements of the Minister of Energy, Mines and Resources. He stated that the objectives which the bill seeks to achieve are, for the most part, familiar to mem-
November 4, 1974

bers as being now well established components of an integrated national energy policy. That is an interesting statement in itself. It is very cleverly worded. You cannot really tell whether the statement means "we had an energy policy", "we have an energy policy", or "we will have an energy policy".
The question of energy policy is a very interesting one and was the subject of much remark in 1972. In fact I can remember Doug Stewart, the former member for Okanagan Kootenay, speaking about the lack of a Liberal energy policy at that time. I wonder if that is why he decided to retire. In any event the stand of the leader of my party on an energy policy was very clear in 1972: he expressed the need for the development of an energy policy, a policy that did not exist at that time, and which really does not exist today.
Let us look twice or three times at this statement, and let us look at it for what it says, not for what it purports to say. Purporting to speak of energy as oil and gas, and only oil and gas, what it really talks about, in my view, is all sources of energy, be they oil and gas, thermp nuclear, water and its hydro electric end result, or coal and coke fired steam generators. These last two, coal and coke, as well as hydro electric energy, are of considerable interest to me and of concern to my constituents. They are also of concern to the people of the riding of Okanagan Boundary. I mention that riding because of the massive coal deposits which exist in Fernie and the Crowsnest area.
Why are the people of Kootenay West concerned? I do not think there are many senior members in this House, along with the people of my riding, who will have forgotten the Columbia River sellout, the Kootenay Canal with which we are now faced, the Kootenay dams, the Libby Dam with which we have been cursed, and the massive effect on the environment at Kootenay Lake and the Pend d'Orielle River. What is the reaction of the people in my riding to that of playing waterboy to the North American continent? I think it is viewed as a threat to the people that they will be blessed with another damned dam. They have had dams up to their necks.
What are these people doing about the situation? Let us look at the record of B.C. hydro and its proposal to put a dam on the Pend d'Orielle River. The people of Trail and Fruitvale and the surrounding area were sufficiently sensible to do their homework, and they succeeded in bringing that project to a halt until proper studies had been completed on the environmental, hydro electric needs, the end results and so on. I can assure you that the concerns of the people will still be directed in that way, whether it involves hydro electricity or coal.
When the minister addresses himself to a national energy policy I frankly do not know whether he speaks of an oil and gas policy or a truly national energy policy, and I am not sure what are the parameters of such a policy. I do not think anyone knows, except perhaps the minister.
This bill we have before us does not in fact speak for Canada but speaks for an arrogant, self-centred and dictatorial administration. For the record let me again quote from Section 109 of the British North America Act. It states:
Oil and Petroleum
All lands, mines, minerals, and royalties belonging to the several Provinces of Canada, Nova Scotia and New Brunswick at the Union, and all sums then due or payable for such lands, mines, minerals, or royalties, shall belong to the several Provinces of Ontario, Quebec, Nova Scotia, and New Brunswick in which the same are situated or arise-
As the last speaker said, it is true that they were dealing at that time with a time frame far removed from the present, but that does not remove the responsibility on the part of the government to sit down with the provincial first ministers and do some real hard heart to heart talking. That does not preclude the necessity of some real hard bargaining. It is not good enough to say that a particular first minister will not agree. This all requires further dialogue rather than that type of confrontation.
What are the first ministers' responses now, and what will they do in future as our national policy expands so that we get into considerations of hydro electric generation, coal and thermo nuclear generation? These things are all covered under the general term energy, and this will affect all the provinces. The federal government will be involved, but the question is how, and under what terms?
Clause 36 of this bill is one that I think will give the first ministers of the provinces a future migraine headache. This bill represents a major precedent to the next step. I suggest that the next step, apart from laying the groundwork for policy in areas of energy source, will also lay the groundwork for the Minister of Finance (Mr. Turner) when he entertains the government and the people with his forthcoming budget address. What will he do? The odds are that he will also move into the energy and natural resource fields with future taxation which will bring into effect, again by direct confrontation with the provinces of British Columbia, Alberta and Saskatchewan, the whole question of resource taxation. I suggest the groundwork for that taxation is right here in this energy bill.
One might ask why I should be concerned about this and why the people of my riding should be concerned. I am concerned because of the vast resource of minerals in the riding of Kootenay West and the riding of Okanagan Kootenay, and because of the massive taxation that has already been introduced by a shortsighted provincial government. Reference has been made during the debate on this bill to a passage by Mr. Laskin. I think it deserves repeating at this time:
The respective taxing powers of dominion and provinces may not be used by either of them to sterilize powers conferred by the other upon its functionaries or substantially to impair their status.
My concern is not with the finer technical points or the major economic points to which experienced gentlemen have referred. My concerns are the concerns of the people of my riding whom I represent. May I call it ten o'clock, Mr. Speaker.

November 4, 1974
Adjournment Debate



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Walter Baker (Grenville-Carleton):: Mr. Speaker, on October 7 I directed a question to the Minister of State for Urban Affairs (Mr. Danson) regarding something which had arisen on a television program, namely, a theory he advanced in the course of "Question Period", that the government certainly would have to consider the adoption of a trade-off in respect of green spaces in Canadian cities.
At that time this indicated that the minister was at least considering the intrusion of development into green spaces. Subsequently the minister, in the course of his answer, indicated that at least in so far as the two places I had mentioned in the National Capital Area, namely, the Experimental Farm and the Ottawa green belt, he regarded these as areas of special sensitivity, and shared my view and the view of many other members of the House in respect of the necessity to preserve them.
I want to say that where we are dealing with the National Capital Area, which is certainly an area of special sensitivity, or with any other urban area in this country, we must regard, and government policy must look at green space in urban areas as a very precious commodity. It is becoming more precious each day as there is a tendency in our society, and in the planning of our society, to pack more and more people on to fewer and fewer acres of land.
Municipal development is becoming vertical rather than horizontal. Indeed we must consider the impact that this type of development will have on open space, a particularly agricultural land. The green belt and the Experimental Farm in the National Capital Area are precious for the reasons I have mentioned.
I do not want the minister or the government to feel that I regard those areas as sterile, or believe that they ought to remain dormant or fallow. I feel, however, that there are certain institutional uses to which these lands could be put.
I want to make clear that we regard the trade-off in respect of the Experimental Farm, the green belt or any other area in an urban part of Canada as a principle we would have to approach with great caution in order to ensure that there is open space available. There really is no open or green space available to those who live in high-rise housing, row housing, in condominiums, or in densely populated areas. That green and open space which normally is provided by one's backyard, or by the neighbourhood park, must be provided in those urban areas by

green belt areas such as the Experimental Farm, or by other areas in other cities.
This matter is of great concern not only to the National Capital Area but to other areas. I hope the parliamentary secretary tonight will give us some assurance in respect of the policy of the government on the matter of green space in urban areas.


Mr. Pierre De Bane (Parliamentary Secretary to the Minister of State for Urban Affairs):: Mr. Speaker, I want to assure the hon. member that the National Capital Commission is fully aware of the matter which he has raised, namely that we must preserve the green spaces of this area.
I can assure the hon. member that there is no question of replacing the green spaces already existing in the national capital region with buildings. On the contrary, proposals are presently under study in order to link these green spaces together and to have them penetrate further into the urban area, so that they are not isolated and remote. This approach might require an increase, and certainly not a decrease of green spaces and an adjustment of the limits of the spaces already existing.
As I said, some adjustments might be necessary at certain times, which means that parts of existing open spaces could be traded against new ones in order to achieve a better integration. But I can tell the hon. member that both quantitatively and qualitatively, green spaces are going to increase in the capital region.
I also wish to remind the hon. member that the NCC will very soon make public its planning concept for the whole region. This document, along with the proposals it will contain, will be studied by a joint special committee of the Senate and the House of Commons and of course members will have the opportunity to express their views. The long-term preservation of these resources must be ensured, and at the same time the public must have access to them, without spoiling or wasting them. The achievement of this objective implies the cohabitation of certain urban and rural environments. A typical example of this is, of course, the Experimental Farm in the centre of the city of Ottawa.


HOUSING-SUGGESTED MEASURES BY CENTRAL MORTGAGE AND HOUSING CORPORATION TO CONTROL IRREGULARITIES BY OTHER AGENCIES
Mr. Jean-Robert Gauthier (Ottawa-Vanier):: Mr. Speaker, last Friday I directed a question to the Minister of State for Urban Affairs on a very important problem in my constituency, namely real estate speculation and speculation activities on the part of provincial companies, that have led me to believe during the last few months that such behaviour left much to be desired. For the sake of my electorate, I sent letters and I followed the matter very closely. I have come to the conclusion that the Central Mortgage and Housing Corporation is not watching its expenditures closely enough whenever it guarantees or grants loans to provinces, which then use the money for public housing.
November 4, 1974

What prompted me, Mr. Speaker, to examine thoroughly the whole matter of public housing in my constituency of Ottawa-Vanier is that certain transactions show either a lack of qualification or of interest on the part of certain public servants whenever public interest and especially consumers' protection are concerned. I know that in the province of Ontario, proceedings are being instituted with the Ontario Housing Corporation and members will recall that I quoted the article from last Thursday's edition of he Droit, saying that 15 officials have been indicted for receiving bribes and for collusion with contractors. According to that article, 9 other persons in the Ottawa or London area are likely to be indicted very soon.
When real estate speculation is practiced to the detriment of the interest of the community and in some collusion with provincial agencies, I think that speculation is unacceptable, and smacks more of theft than business. Indeed, that is exactly what is happening in my riding. That was the purpose of the question I put to the minister regarding certain transactions that benefited certain contractors. They made profits of about 155 per cent in an eight-month period. I have here a copy of the land register for a sale of $105,000 which, eight months later, increased to $273,000 for a piece of land on which a high rise for senior citizens was to be built.
I also know that the City of Vanier can buy land in my riding. In that city of one square mile land sells for $5 a square foot. I also know that the Ontario Housing Corporation pays $10 a square foot. I noted several cases of profiteering in my opinion and I asked the mayors of both municipalities of Ottawa and Vanier as well as the Central Mortgage and Housing Corporation and the Ontario Housing Corporation for a list of real estate transactions made in the last three years.
I did that because the experience I gained as a school trustee gave me a certain knowledge of the price of land in my riding. At that time I did learn of lots which were bought by certain contractors at a price which, personally, I find quite scandalous.
I remember, in particular, a piece of land located not too far from the Cartier school, a composite school, which was for sale for some $35,000 and that the school board has refused to buy because they said it was too expensive; it was sold and sold again to someone else and finally, within eight months, it went for $273,000. That is the kind of speculation that makes me think that it is not only there that funny things are happening.
And what annoys me is that the Central Housing and Mortgage Corporation, the lender, is not necessarily an accomplice but controls are lacking; that is why I asked the minister here if he uses his powers of control over real estate expenditures made by the housing corporations and I am not under the impression that this is presently done in a routine way. I am under the strong impression, though, that as with all federal-provincial agreements, the federal government is paying the piper and the province is playing the tune.
However, in my riding, as in several others in Canada, there is now a housing crisis. I find the situation is tragic because, speaking in quantities, if land is bought for twice
Adjournment Debate
what it is worth and high-rise buildings are built where they have no business being built, only half of the housing will be produced.
And if the reasoning is simplistic, I think that money being what it is today, expensive and hard to come by, the Central Mortgage and Housing Corporation should proceed with all the necessary caution and see to it that it can control its expenditures.
Within the shortest delay, federal government supervision over the use of funds made available to the provinces must be made more strict. The federal government must act to protect the common good rather than to favour all-out business. And to complete my question, Mr. Speaker, I would like to ask the parliamentary secretary to the minister if he can give me the assurance that account will be taken of my remarks by the Central Mortgage and Housing Corporation. If you wish it, I can give further proof in support of my allegations.


Pierre De Bané: Mr. Speaker, I can assure the hon. member that the Central Mortgage and Housing Corporation and the Minister of State for Urban Affairs (Mr. Danson) will be extremely interested by this information.
However, I would like to remind him that since 1968, Ontario, through the Ontario Housing Corporation completed its low rental housing projects under the National Housing Act with the help of federal government loans. Consequently, the Central Mortgage and Housing Corporation acts as a lender in its capacity of federal agency concerned. Previously, the federal and provincial governments were associated in these projects which were financed under another section of the National Housing Act.
According to the provision concerning loans (section 43 of the National Housing Act), the Ontario Housing Corporation is responsible for the planning of projects, for land banking and calls for tender or proposals.
As a lender, the Central Mortgage and Housing Corporation reviews on an individual basis applications for loans relating to those projects in order to ensure that they meet the criteria as well as the standards of programs.
As far as the land is concerned, the loan application made by the Ontario Housing Corporation in respect of every project indicates how much it has to pay for the land as well as the name of the seller. The application also includes an estimate of the land value made by an independent assessor. As part of its study, the Central Mortgage and Housing Corporation requests from its assessors an estimate of the value of the land to determine the amount of the loan. Therefore, in addition to the amount paid by the Ontario Housing Corporation, the Central Mortgage and Housing Corporation makes its own estimate in order to determine the amount of the federal government's loan. That amount is based partly on the value of the land as determined by the assessor, and not only on the amount paid by the Ontario Housing Corporation.
Under those circumstances, the Central Mortgage and Housing Corporation has neither any reason nor any opportunity to learn the details of the transactions that have

November 4, 1974
Adjournment Debate
been carried out in respect of the land chosen for a project of the Ontario Housing Corporation.
However, no one of course is perfect, everyone may be misinformed, and as I said at the beginning of my remarks, the hon. member can be assured that if he will submit us some information concerning the pieces of land acquired by the Ontario Housing Corporation which in his opinion might justify further enquiry, I have no doubt that the minister would like the hon. member to impart the Central Mortgage and Housing Corporation with that information.


PUBLIC SERVICE-APPOINTMENT OF MICHAEL PITFIELD- POSSIBLE CHANGE IN CRITERIA FOR MAKING APPOINTMENTS
Mr. Joe Clark (Rocky Mountain):: Mr. Speaker, on October 8 I raised a question with the Prime Minister (Mr. Trudeau). I asked if he would make a statement on motions outlining the principles which were now to be followed for appointments to the senior public service. I drew particular reference to Mr. Michael Pitfield, and asked the Prime Minister to indicate whether that appointment suggested a replacement of the merit system by the buddy system.
The Prime Minister ducked that question, and instead attacked my right as a member of parliament to ask about the appointment and credentials of an official who now has more influence than most members of cabinet, and whose only unusual qualification for that office appears to be his personal friendship with the Prime Minister.
The Prime Minister indicated that an appointment at that level was at the discretion of the government. Of course it is, but it is the duty of this parliament and the members here to question the judgment that is used in exercising that discretion. That is a matter of concern not only to this House, but to people outside, including the Ottawa Journal, which wrote shortly afterwards, and I quote:
Prime Minister Trudeau... has shown remarkably bad judgment in choosing an intimate friend for a position so exquisitively sensitive.... A Prime Minister needs to have friends and advisers around him whom he can trust completely, who will give him their first call on their loyalty. But the place for them is on his own staff, not in the public service.
That appointment started a precedent. It is inevitable that when the present Prime Minister leaves, so will Mr. Pitfield. Some other favourite of some other Prime Minister will come in. The senior job in the Canadian Public Service has, by this one act, been made a partisan political position. That act has changed our system of government and, in one stroke, threatened the political independence of the Canadian public service.
Mr. Pitfield's appointment is the most celebrated case, but it is not an isolated instance. That is the matter which is of grave concern to this House. His appointment is part of a pattern of moving political friends into a public service which can be respected and effective only so long as it is free from the suspicion of partisanship. Not only in this last month have we had the appointment of Mr. Pitfield to his high position, we have also had the appointment of Mr. Jim Davey, late of the Prime Minister's office and late of the Minister of Transport's office, to a senior

public service position in the Department of Transport. We have seen the Hon. Paul Martin dispatched as High Commissioner to Great Britain. These people now enter the public service to join others like Timothy Porteous, Edgar Benson, Mike McCabe, Paul Gerin-Lajoie, and who knows how many others.
It is known to this House and accepted that for some time there has been a provision allowing the shifting into the public service of people who have served, in the senior executive capacity, political ministers and others. Because of the salary level at which these people shift, they inevitably go into the public service in a policy position.
I placed a question on the order paper to find out how many of these people there are in the public service and what areas of policy they influence. I did this because I think it is highly important to the system.
The practice poses three critical threats to our system. First, it destroys the balance which is so essential between the elected politicians and the appointed public servants. At the same time it threatens and jeopardizes the long range independence of the Canadian public service.
The second threat arises because it undermines morale in the service itself. It removes the incentive to excel. Indeed, it fosters an incentive simply to please one's master because excellence is no longer the standard which determines promotion; it is friendship which is now becoming the standard by which promotion is achieved.
The third threat is that it narrows the basis of advice on which national decisions are made. This is a diverse country, and the government should reflect that diversity. But it will not do so if the public service is to be formed in the image of a partisan prime minister.
I asked the Prime Minister to tell us the guidelines to be followed in making that kind of appointment. He has given us no guidelines. I also put a private member's notice of motion on the order paper in an effort to ensure parliamentary scrutiny of the growing powers of the office of the Prime Minister, which appear to be at the root of the problem we face today. What we must consider is not just a question of Mr. Pitfield's credentials; he is obviously a brilliant person, an able man. Nor is it a question of stopping patronage, which has been going on for ever and ever.
The Prime Minister, by this action, by this pattern he has established, is changing the very nature of the Canadian public service and the very nature of our system of government. He is bypassing merit, undermining morale, compromising an essential independence, and eroding the protection of regions or groups whose interests are not represented by the political government of the day. It is regrettable that the Prime Minister should have indicated, in putting aside this question, that he wants no attention paid to the process that is taking place. It is not too much to say that he is achieving by stealth changes of more significance and more permanence in our system than a change of government could bring about.
I believe this is an urgent question for the House to consider both in relation to appointments to senior levels of the public service and to the growing power of the
November 4, 1974

Prime Minister, and I hope the answer from the parliamentary secretary will allow us at least to begin the process of examining the way in which our system is being changed.


Pierre De Bané: Mr. Speaker, that is certainly one of the shabbiest attacks I have had the opportunity to witness since I have been here in this House.
The hon. member who must certainly have at least one ounce of honesty, recognized that Mr. Michael Pitfield is, and I quote, "able and brilliant". Then what is he blaming Michael Pitfield for? I think he did not have the chance I had to work with Mr. Pitfield. For several months, I worked with him when he was deputy minister of Consumer and Corporate Affairs. May I say to the hon. member that I seldom met a man so much sensible to the performance of his duties, to the opinion of members of parliament and to the wishes of his minister and who did his duty in a way which, I believe, enhanced the prestige of his position. May I remind him that before leaving that position he had been Planning Director of the Prime Minister's Office. He has served as public servant for many years and I think it is utmost shabby to attack in such a contemptible way one of the most competent officials in the Public Service.
Adjournment Debate
Does the hon. member mean that he is a supporter of the so-called in-breeding-it is done in External Affairs-and that public servants should be hired at 25 years of age after university graduation. I feel that it is quite retrograde. He only has to consider private enterprise. Every day, people outside are sought to bring in some fresh blood.
If I had to give my own view, I would say to him that it is unfortunate that it is not done more often in Ottawa. The establishment, and many studies have been made on that issue, exerts too much influence and one of the reasons is that there are not enough competent people from outside coming into public service at higher levels.
Even if the hon. member continues to tarnish the reputations of individuals such as the above-mentioned, without questioning their competence, let him do so! Does the hon. member suggest that the Hon. Paul Martin will not ably discharge his duties? If he thinks so, let him say it frankly. If he thinks that Mr. Paul Gerin-Lajoie does not ably manage the Canadian International Development Agency, let him say so-or Mr. Jim Davey!
Anyhow, Mr, Speaker, I think that the charges of the hon. member are shabby and completely unwarranted.


Mr. Deputy Speaker:: Order please. The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 2 p.m.
Motion agreed to and the House adjourned at 10.27 p.m.

Tuesday, November 5, 1974