1974-10-29

ROUTINE PROCEEDINGS


[Stage Direction]
First and second reports of Joint Committee on Regulations and other Statutory Instruments, in English and French-Mr. Robert Me Cleave.
[Editor's Note: Text of foregoing reports appears in today's Votes and Proceedings.]

Hon. Alastair Gillespie (Minister of Industry, Trade and Commerce):: Mr. Speaker, pursuant to Standing Order 41(2) I am tabling in both official languages copies of the joint press communique on the Canadian mission which I led to Brazil.


AGRICULTURE
Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, on a matter of pressing necessity I rise under the provisions of Standing Order 43 and move:
That in light of recent developments in the Canadian beef industry, the slaughter of calves in Manitoba and Ontario, the slaughter and subsequent hanging of three calves on scaffolds bordering Quebec's route 153, and today's threatened slaughtering of some 600 calves in Quebec, the House requests the Minister of Agriculture to establish an inquiry into the industry immediately.


Mr. Speaker:: Order, please. The house has heard the terms of the motion. It being proposed pursuant to Standing Order 43 it cannot be debated without the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There being no unanimous consent it cannot be put at this time.


ADMINISTRATION OF JUSTICE
Mr. Gilbert Rondeau (Shefford):: Mr. Speaker, under the provisions of Standing Order 43, I rise on a matter of urgent and pressing necessity and I request the unanimous consent of the House.
Considering the invitation extended by Mr. Jerome Choquette, Minister of Justice of the Province of Quebec, to the Solicitor General of Canada (Mr. Allmand), to meet him in a public debate, I move, seconded by the hon. member for Rimouski (Mr. Allard):
That this House instruct the Solicitor General to meet Mr. Cho-quette's challenge without delay.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There being no unanimous consent, the motion cannot be put at this time.


AGRICULTURE
Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, I seek the unanimous consent of the House under Standing Order 43 to propose a motion on a matter of urgent and pressing necessity, that is the very uncertain position of beef producers.
Since beef producers in Eastern Canada are slaughtering cattle day after day on or along the roads for the purpose of drawing the government's attention to their difficulties arising from an increase in production costs and a decline in beef prices, I move, seconded by the hon. member for Roberval (Mr. Gauthier):
That this House examine immediately the disastrous situation in which beef producers are now, and that recommendations be made in order to take immediate steps to protect those producers and thus spare the consumer difficulties arising in a few months.


Mr. Speaker:: The House has heard the hon. member's motion which, under Standing Order 43, requires unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.
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October 29, 1974
Oral Questions


Some hon. Members:: No.


Mr. Speaker:: There not being unanimous consent the motion cannot be put.


Mr. Andre Fortin (Lotbiniere):: On a point of order, Mr. Speaker. Since I am forbidden to do so by the Standing Orders, I do not question the Chair's decision, but I want to say that, perhaps because we are sitting at one end of the House, we have not heard hon. members refusing unanimous consent to this excellent and very important motion of the hon. member for Bellechasse. In the name of my colleagues, I request that you ask once more whether there is unanimous consent.


Mr. Speaker:: I can only say the refusal was quite clear for the Chair.


CRIMINAL CODE
Mr. Bob Kaplan (York Centre) moved: for leave to introduce Bill C-360, an act to amend the Criminal Code.


Some hon. Members:: Explain.


Robert Phillip Kaplan: Mr. Speaker, this bill will amend the Criminal Code to fill the gap created by a recent decision of the Ontario Court of Appeal. Before that decision an offender could be convicted, if found guilty, of making an indecent proposition to a child under 15 years of age if the offence were proven. The decision had the effect of requiring some physical touching to complete the offence. The amendment will restore the former law and give extra protection to children.


[Stage Direction]
Motion agreed to, bill read the first time and ordered to be printed.
Mr. Speaker:: Oral questions.



ORAL QUESTION PERIOD


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, I have a question for the right hon. Prime Minister in connection with his meeting tomorrow with the premiers of the provinces. I am very pleased that this meeting is to take place. In view of the fact that the Prime Minister rejected the request for such a meeting a few weeks ago and now has invited the premiers to come to Ottawa tomorrow, can he tell the House what the new

development is that makes the meeting seem worthwhile now when it seemed to him to be worthless just a few weeks ago?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, I am not quite sure what the Leader of the Opposition is referring to in terms of what happened a few weeks ago. If he is referring to the idea proposed by Premier Davis in a speech he made at the Toronto Ex when he talked of a public summit, that is the idea I rejected. I have never rejected the idea of consultation; on the contrary, it was very much part of our policy. We talked about it in the Speech from the Throne and I have talked about it at various places publicly and about the importance of talking with all sectors of the Canadian public, including provincial governments.


Robert Lorne Stanfield: A supplementary question, Mr. Speaker. Whatever request may have been made by a particular premier, it was an informal meeting that all the premiers requested following their own meeting. I should like to ask the Prime Minister whether it is intended tomorrow to put before the premiers a specific proposal with regard to the forum and the method of consultation which the government of Canada intends to pursue in order to see whether any consensus can be achieved among the principal groups in our economy as to how the GNP should be divided.


Pierre Elliott Trudeau: Mr. Speaker, I think the best way I can answer this is to indicate the process of consultation which we have always had in mind was an ongoing one; one which would proceed step by step. I would not want to convey to the House the idea that tomorrow we will make any kind of proposition to the provincial premiers. We have announced in the Speech from the Throne that there will be a federal-provincial conference with the premiers early in the new year. The precise type of proposal that the Leader of the Opposition is talking about would be better made then than tomorrow. Tomorrow is the beginning of a process in so far as the premiers's consultations with me are concerned.


Robert Lorne Stanfield: A final supplementary, Mr. Speaker. I must say the Prime Minister's casual approach to the question of inflation is shocking to me.


Some hon. Members:: Hear, hear!


Some hon. Members:: Order, order!


Robert Lorne Stanfield: We are going to see leadership in slow stages. May I ask the Prime Minister what he is bringing the premiers here for tomorrow and what will be the subject of discussion?


Pierre Elliott Trudeau: Mr. Speaker, we will be discussing the subject of inflation. It is not a public summit and I do not intend to reveal the contents of that meeting with the premiers.
October 29, 1974


AGENDA FOR MEETING WITH PREMIERS-SUGGESTED TABLING OF CORRESPONDENCE WITH PREMIERS CONCERNING MEETING
Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, it is obvious that the Prime Minister remembers the actual circumstances in which this meeting was requested, because he responded so smartly in referring to the impotence of the premiers. I am sure he remembers.


Pierre Elliott Trudeau: I did not mean in the physiological sense.


Allan Frederick Lawrence: In order that the premiers can be better prepared for the meeting, has the Prime Minister taken the opportunity of communicating with them with respect to guidelines or any type of agenda for tomorrow's meeting?


Pierre Elliott Trudeau: Mr. Speaker, it was made clear in correspondence I had with them that we would be discussing the subject of inflation. That will be the essence of the agenda.


Allan Frederick Lawrence: Mr. Speaker, so that the affairs of this country can be discussed in this House as well as with the premiers, would the Prime Minister do the House the courtesy of letting others in this chamber see this correspondence as well, or at least give us a general outline of what is going to be discussed tomorrow.


Pierre Elliott Trudeau: Mr. Speaker, I do not object to tabling a copy of that correspondence, provided I get the authorization of the premiers to table any responses. The House will not be deprived of its chance to discuss this. Indeed, we shall welcome constructive suggestions from the opposition. I will have an excellent opportunity to do this at the time of the budget.


INDUSTRY
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, my question is for the Minister of Industry, Trade and Commerce. Can the minister inform the House whether his department commissioned a comprehensive study of all federal government grants made to United Aircraft Corporation. If so, has it received the results of that study? Finally, if the answer is yes, will the minister make available to members of parliament the study to which I referred?


Alastair William Gillespie: Mr. Speaker, it is an overstatement to suggest that a comprehensive study has been commissioned. Work has been done with respect to reviewing outstanding contracts between the government and UACL. That review establishes that roughly $66 million of some $70 million can be repaid, if the company makes a profit. I described these amounts as grants. I think that was the accurate way to describe these funds as, by the company's own admission, it has already lost $87 million.
Oral Questions


John Edward Broadbent: Mr. Speaker, I think the minister misunderstood the question. I am referring not to a study which he may have requested within the past couple of weeks, but to a study of a much earlier time. Has a study been done with regard to the financial wisdom of making grants to that corporation in the first place? I am asking if such study was done some time ago, and it is to that study that I referred in requesting the minister to table the findings, if it was carried out.


Alastair William Gillespie: Mr. Speaker, I have no knowledge of such study as alluded to by the hon. member, but will make inquiries with respect to the matter.


UNITED AIRCRAFT CORPORATION-SUGGESTED SUSPENSION OF GRANTS PENDING INQUIRY INTO OPERATIONS OF CORPORATION
John Edward Broadbent: Mr. Speaker, may I ask a final supplementary question. Considering that the government of Quebec decided to suspend payment of part of the $2 million grant which had been made available to United Aircraft Corporation, because that government suspects the company has not carried out its obligations, and in view of the announced failure of de Havilland Aircraft Corporation of Toronto, which is now owned by the government of Canada, to carry out its production obligations because it cannot get engines from United Aircraft, will the federal government, because of its more substantial financial involvement with United Aircraft, consider suspending its grants to that corporation pending a full inquiry into its operations.


Alastair William Gillespie: Mr. Speaker, there are a number of different grants involving the government and the corporation which deal with particular projects. These are always under continuing review, to ensure that undertakings given by the company with respect to contracts are met.


AGRICULTURE
Mr. Real Caouette (Temiscamingue):: Mr. Speaker, I have a question for the hon. Minister of Agriculture.
In view of the prevailing situation in agriculture, and of the fact that calves are being sacrificed in the Shawinigan area and elsewhere in the province of Quebec, is the minister maintaining contact with his Quebec counterpart to find a solution to this very serious problem which is far from favouring farmers at the present time?
Mr. Speaker, our farmers being most justified to take such action, has the federal Minister of Agriculture any solution to propose to the Quebec government to remedy this situation?

October 29, 1974
Oral Questions


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, the hon. member asked if I have a solution to Quebec's problem. I think certain responsibilities concerning this problem are provincial. As I said the other day, Quebec has put forward what is probably the most realistic program of any province to assist meat producers. We are working on a program which I hope will be realistic enough to assist them in a different fashion than the present provincial programs, including that of Quebec which, as I said, is the most far reaching of any program with regard to assistance.


CONSUMER AFFAIRS
David Réal Caouette: Mr. Speaker, I have a supplementary question for the hon. Minister of Consumer and Corporate Affairs.
Our farmers keep complaining that, while their calves sold last year for 60 to 75 cents a pound, they can hardly obtain 15 cents a pound this year. Yet, prices in meat markets and supermarkets remain exactly at the same level as last year.
Has the department taken steps to find out who are those who really abuse the situation and who are robbing Canadian consumers?


Hon. Andre Ouellet (Minister of Consumer and Corporate Affairs):: Mr. Speaker, may I remind the hon. member that Mrs. Plumptre is responsible for the review of food prices. On the other hand, I should like the hon. member to provide me with all the data he has just quoted to the House, because, apparently, they are not in complete accordance with the facts.


David Réal Caouette: A last supplementary, Mr. Speaker.
The minister has just said that the figures I quoted were not in accordance with the facts. In my area, and I know it, farmers sometimes organize public auctions, and the prices which they were offered in some cases were so low that they had to buy back their own cattle because they would have taken a total loss selling them on auction. Has the minister checked the figures of the Farmer's Union of the province of Quebec, which confirm exactly what I have just said?


André Ouellet: Mr. Speaker, a study is presently under way on this subject, and if the hon. member wishes to provide me with other figures, I will be very glad to pass them along to those who are presently studying that matter.


PUBLIC SERVICE
Mr. Gordon Towers (Red Deer):: Mr. Speaker, my question is for the President of the Treasury Board. Due to the fact that 45 of 48 grain inspectors in Vancouver who booked off work yesterday have apparently been stricken by the germ which was incubated within the Labour Department at Ottawa during the strike of grain handlers, is the President of the Treasury Board willing to swallow the same antidote which the government forcibly imposed on farmers then in order to prevent extended work stoppages or a strike by these inspectors?


Hon. Jean Chretien (President of the Treasury Board):: Mr. Speaker, the inspectors in question are presently negotiating with the government. We hope that we will soon come to a satisfactory arrangement.


Thomas Gordon Towers: A supplementary question. Calling the tune as the government did in the grain handlers strike, is the government now prepared to pay the fiddler and will the President of the Treasury Board go to the west coast and meet with the grain inspectors in an attempt to resolve a very serious situation?


Joseph Jacques Jean Chrétien: Mr. Speaker, there is a well established procedure in Canada to cope with such situations, that is negotiation and conciliation. We are therefore following the normal procedure. Those workers are not presently in a position to go on strike illegally, and we hope we will be able to solve the problem before they are in a position to strike.


FEDERAL-PROVINCIAL RELATIONS   POSSIBLE PROPOSALS BY MINISTER OF LABOUR FOR DISCUSSION AT MEETING WITH PREMIERS-LIAISON WITH PRIME MINISTER
Mr. Lincoln M. Alexander (Hamilton West):: I should like to follow up this matter, Mr. Speaker, in the light of the fact that collective bargaining is bound to be of particular importance in 1974-75. In view of the fact that in 1975 we shall be faced with the heaviest collective bargaining agenda in Canada's history, and since labour is concerned with protection against future inflation, could the Minister of Labour inform the House whether he has prepared recommendations aimed at avoiding a labour crisis in 1975 to put before the provincial premiers at the conference on inflation?


Hon. John C. Munro (Minister of Labour):: I think a question relating to the agenda to be considered by the first ministers' conference dealing with inflation should more appropriately be addressed to the Prime Minister.
October 29, 1974


Lincoln MacCauley Alexander: I thank the minister for his answer but I do not know why I should have to direct the question to the Prime Minister; the Minister of Labour is surely making some input. I would ask the Prime Minister whether there have been any recommendations from the Minister of Labour, prepared in advance and aimed at avoiding a labour crisis in 1975, which the right hon. gentleman can place before the premiers at the conference on inflation? Has there been any liaison between the Prime Minister and the Minister of Labour on this most sensitive and important issue?


Pierre Elliott Trudeau: Of course, Mr. Speaker, in the kind of consultations we have in mind the Minister of Labour will play a very important role. As far as I am concerned, it is not intended, tomorrow, to go into any details with the premiers on that particular subject. But if they have proposals to make which might be of interest to the Minister of Labour I will certainly make sure he hears about them.


POSSIBLE PROPOSALS BY MINISTER OF FINANCE FOR DISCUSSION AT MEETING WITH PREMIERS
Lincoln MacCauley Alexander: It seems to me that the Minister of Labour and the Prime Minister are playing hanky-panky with a serious situation. As I understand it, on September 16, the Minister of Finance stated:
It is important that we seek to develop a national consensus in support of working out a fair and reasonable balance between wages, prices and profits which would best serve the common interest of us all.
I would now ask the Minister of Finance, if he is serious, whether there has been any discussion between himself and the Prime Minister in order to bring this principle of his before the premiers tomorrow to determine whether there is a possibility of reaching a consensus regarding these matters.


Hon. John N. Turner (Minister of Finance):: Yes, sir.


Allan Frederick Lawrence: On a point of order. I do not wish to waste the time of the House but I think the answer-


Mr. Speaker:: Order, please. I will come to the hon. member's point of order in a moment. With an answer like that I really think it would be improper to cut off one final supplementary from the hon. member for Hamilton West.


Some hon. Members:: Hear, hear!


Lincoln MacCauley Alexander: Now that we are finding that something is going on over on the other side, would the Minister of Finance be kind enough to advise us whether he is prepared to table the recommendations he has made to the Prime Minister in this regard so that we can all have some idea what will happen?


John Napier Turner: Conversations between the Prime Minister and other members of the government at this stage are within the realm of cabinet confidence. As the policy is developed it will appear on the floor of the House.
Oral Questions


Allan Frederick Lawrence: Mr. Speaker, I really do apologize for rising on a point of order-


Some hon. Members:: Well, sit down, then!


Allan Frederick Lawrence: -but that does not prevent me from raising it. The Minister of Labour referred in the House a few moments ago to "the agenda for tomorrow's conference."
The Prime Minister indicated to me that there was no agenda for tomorrow's conference. Can the Minister of Labour tell the House whether he has actually seen this agenda or not?


Mr. Speaker:: I am not sure about the validity of the point of order but if the minister wishes to clarify his use of that term he may do so.


John Carr Munro: Mr. Speaker, quite simply, as I understood it, the hon. member for Hamilton West asked me about some agenda for the conference tomorrow. Without dwelling unduly on the word "agenda," I take it he was concerned with the question of labour-management relations generally and how we would confront the whole labour situation and collective bargaining in the ensuing year. I indicated to him that in terms of the Prime Minister being chairman of the first ministers conference it would be more appropriate for him to direct the question to the Prime Minister, and that was all there was to it.


EXTERNAL AFFAIRS
Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, I have a question for the Prime Minister. As the Prime Minister will shortly be undertaking a very important trip to Washington to make the acquaintance of the new President of the United States and discuss very important matters with him, does the Prime Minister feel confident that he will be able to bring about the same degree of mutual respect and warm personal friendship with Mr. Ford as he was able to generate with President Nixon, as evidenced by the Watergate tapes?


Some hon. Members:: Oh, oh.


Pierre Elliott Trudeau: Mr. Speaker, after sitting across the aisle from the hon. member for Prince Edward-Hastings for something like six years, I know that the friendship between us has not been impaired by the kind of foul language that he thinks will be used.


Some hon. Members:: Oh, oh.


George Harris Hees: Mr. Speaker, does the Prime Minister's unwillingness to answer that very important and serious question, one that is very important to the good of the country's future, mean that he does not believe that he is

October 29, 1974
Oral Questions
going to be able to evoke from Mr. Ford even the same appreciation of his qualities as he got from Mr. Nixon?


Pierre Elliott Trudeau: Mr. Speaker, my answer to that question is that it is obvious that the hon. member does not know the difference between razzmatazz and a hole in the ground.


Some hon. Members:: Oh, oh.


FEASIBILITY STUDY OF CONSTRUCTION OF ARCTIC RAILWAY TO TRANSPORT OIL AND GAS-TABLING OF SUMMARY
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, some weeks ago the Minister of Energy, Mines and Resources stated that an investigation was being made to determine whether or not railway transportation through the Crowsnest pass of oil and gas was viable and practicable. I ask the minister whether there has been any further consideration given to this matter since, as I recall it, a final decision was expected in the latter part of October.


Hon. Donald S. Macdonald (Minister of Energy, Mines and Resources):: Mr. Speaker, may I ask the right hon. gentleman whether he was asking about a rail line or the over-all transportation of oil?


John George Diefenbaker: Mr. Speaker, it is still rather general. That type of answer leaves quite a hole in the head. Is any consideration now being given to determining the practicability of bringing oil and gas from the north by rail through the Crowsnest pass, thereby preserving the environment from many of the dangers that would otherwise be present should a pipeline be constructed?


Donald Stovel Macdonald: Mr. Speaker, the hon. gentleman is referring to the study carried out at the instance of the Minister of Transport and myself by Canadian National and Canadian Pacific. The study has been received. I think I am right in saying it consists of six volumes which are now being translated. It would be the proposal of our department to lay on the table, probably next week, another summary so that it can be before the House before the full document is available.


John George Diefenbaker: As far as laying a summary before the House is concerned, has the government given any consideration to this action being taken so that oil and gas from Alaska, the Northwest Territories, the Yukon and so on can be hauled by train rather than moved by pipeline? Is the government giving any such consideration to this, or is it simply placing before the House six volumes which, before translation, the minister apparently does not understand?


Donald Stovel Macdonald: Mr. Speaker, I am sure the hon. gentleman would want-


Robert Lorne Stanfield: We want an unexpurgated edition.


Donald Stovel Macdonald: -as the Leader of the Opposition would want, to make certain that we lay all documents before the House in both official languages. But apparently the Leader of the Opposition does not agree with that.


Robert Lorne Stanfield: Mr. Speaker, I rise on a point of order. I really do not mind the thumper, if I may use that term informally, inputing statements or attitudes to me, but I do want to say that what I actually said was that we do not want any expurgated edition, particularly any expurgation that is conducted by the minister.


Some hon. Members:: Hear, hear!


Donald Stovel Macdonald: Mr. Speaker, it seems to me that I have touched a point there, which may not be without significance. I can only say that the government has given some consideration to the possibility of building a railroad in this regard, but no final decision has been taken.


John George Diefenbaker: If you had answered the question that way in the beginning, we would have saved a lot of time.


INDUSTRY
Mr. Hugh A. Anderson (Comox-Alberni):: Mr. Speaker, I have a question for the Minister of Industry, Trade and Commerce. In view of the worsening unemployment picture in Canada-


Some hon. Members:: Oh, oh!


George Harris Hees: There will be trouble in caucus tomorrow.


Hugh Alan Anderson: -in the forest industry, can the minister advise the House whether-


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. In view of the obvious and dramatic increase in the popularity of the hon. member who is attempting to pose a question, it might be very worthwhile listening to what his question is.


Hugh Alan Anderson: Thank you, Mr. Speaker. In view of the worsening employment picture in Canada-


Some hon. Members:: Hear, hear!


Hugh Alan Anderson: -and particularly in British Columbia in the forest industry, can the minister advise the House what steps his department has taken, or will take, to stimulate the forest industry and alleviate the unemployment problem?


Alastair William Gillespie: Mr. Speaker, my department has been very active through a variety of measures and programs aimed at finding new export possibilities for the Canadian lumber industry. We have had recent successes in Japan,
October 29, 1974

Iceland, Cuba and the Middle East. Indeed, my officials are just about ready to leave for the Middle East. May I add that my officials, on an urgent basis, are examining other options which the government might adopt to ensure and assist the production of lumber during this winter.


Hugh Alan Anderson: A supplementary question, Mr. Speaker.


Mr. Speaker:: Order, please. I point out that with that commercial message we have come to the halfway mark in the question period. The hon. member for Selkirk.


FISHERIES
Mr. Dean Whiteway (Selkirk):: Mr. Speaker, my question is directed to the Minister of Fisheries. In view of the strike by the Freshwater Fish Corporation Employees in Transcona, is the minister planning any action to compensate those fishermen, who have not filled their quotas, and who cannot fish because they cannot sell their fish to the corporation.


Hon. Romeo LeBlanc (Minister of State (Fisheries)):: Mr. Speaker, this is a matter which we are investigating. I hope to have a more complete answer for the member perhaps tomorrow.


Dean Waldon Whiteway: Mr. Speaker, I have a supplementary for the minister. Could the minister inform the House what steps he plans to take with reference to the unemployment insurance qualification which cannot be met because the fishermen cannot fish, therefore cannot sell and therefore do not qualify for UIC benefits. Would the minister also tell the House what steps will be taken in respect of the same problem in connection with the Canada Pension Plan.


Roméo LeBlanc: Mr. Speaker, the hon. member knows that the responsibility for the two programs he mentions lies with other ministers. We will consult with them to see what they intend to do.


PUBLIC SERVICE
Mr. David Orlikow (Winnipeg North):: Mr. Speaker, my question is directed to the President of the Treasury Board. In view of the seriousness of another work stoppage in respect of grain shipments out of Vancouver would the minister explain to the House what he means by collective bargaining when apparently representatives of the government made an offer of 8 per cent and 8 per cent, which is less than the increase in the cost of living.
Oral Questions


Joseph Jacques Jean Chrétien: Mr. Speaker, the government negotiators are doing their job properly. They are now discussing with the employees, and I hope that the latter will wait for the conciliation board report before going on strike, because they cannot stop working before the expiration of these legal delays.


David Orlikow: Mr. Speaker, I have a supplementary. Would the minister discuss with his cabinet colleagues the possibility of establishing as a basis for all collective bargaining on the part of the government with its employees, of which there are many groups now entering collective bargaining, the basic policy that the minimum the government would offer any of its employees would be the actual increase in the cost of living, plus the projected increase in the cost of living for the coming year, plus the increase in productivity as recommended by Mr. Justice Hall during his consideration of the railway workers case a year ago?


Joseph Jacques Jean Chrétien: Mr. Speaker, our negotiations with government employees are not conducted on exactly the same basis for all groups. Some of them have some catching-up to do while it is not necessary for others. A universal policy cannot be enforced in view of the circumstances.


David Orlikow: I have a last supplementary, Mr. Speaker. Because not every group is in exactly the same position, I suggest that the minister immediately consider using a floor from which the government would operate, namely, that at least the cost of living increase be taken into consideration plus productivity. I wonder whether the minister would consider that as a floor.


Joseph Jacques Jean Chrétien: Mr. Speaker, I do not think it proper to negotiate collective agreements for the 315,000 government employees in this very House of Commons. Parliament has legislated into being a mechanism designed to settle that matter and we are endeavouring to use it as provided by the law.


SOCIAL SECURITY
Gilbert F. Rondeau: Mr. Speaker, I should like to put a question to the Minister of National Health and Welfare.
In view of the fact that an American senate committee is now studying the $3,500 guaranteed annual income formula recommended to the government for every American citizen, which formula would replace the bureaucratic, dehumanizing and costly welfare system, has the minister asked the officials of his department to follow the work of that committee in order to become acquainted with every
838

October 29, 1974
Oral Questions
aspect of the proposal, which creditistes have been advocating for a long time indeed?


Hon. Marc Lalonde (Minister of National Health and Welfare):: Mr. Speaker, my senior officials indeed follow all studies on the subject being carried out in Canada and elsewhere throughout the world. I am convinced that they are very well aware of the debates of the American senate in this regard.


André-Gilles Fortin: Mr. Speaker, I have a supplementary for the Minister of National Health and Welfare.
Since he is aware of the work being done in the United States in this regard, has he ordered his officials to study it or is he merely waiting for their results before applying them in Canada?


Marc Lalonde: Mr. Speaker, let me say simply that the research being done in Canada in this field, especially that carried out by my officials, is probably further ahead than what is now being done in the United States or just about anywhere, at the present time.


IMMIGRATION
Mr. Claude Wagner (Saint-Hyacinthe):: Mr. Speaker, I have a question for the hon. Minister of Manpower and Immigration.
The Minister Responsible for Immigration has already said in this House, in answer to a question raised by my colleague from Greenwood, that the applications from Haitians living in Canada who are threatened with deportation to their country, and I quote the remainder of the answer:
-were fully considered within the department and that they would take such appropriate measures as appear wise.
Is the Minister prepared to recognize on the one hand that it is the normal attitude of the officers from his department, towards any record submitted to the Immigration Appeal Board and on the other hand that, considering the situation prevailing in Haiti, the cases of all these Haitians threatened with deportation should now be considered collectively and, in this regard, that the time has come for the Minister to submit the whole matter to the Cabinet, even if the Quebec government remained discreet on the subject?


Hon. Robert K. Andras (Minister of Manpower and Immigration):: Mr. Speaker, I cannot make any further comment beyond what I said yesterday. I repeat that we will deal with each of these individual cases on its own merit in the prescribed manner which is that there will be a review of refugee applications by the government's interdepartmental committee on refugees and there would be further access or appeal to the immigration appeal board which body also can deal with the evidence in each individual case, but I am not prepared at this stage to

recommend a mass refugee declaration which would involve many people but rather intend to deal with them on an individual basis.


EXTERNAL AFFAIRS
Claude Wagner: Mr. Speaker, I have a supplementary question for the Secretary of State for External Affairs.
Since there are Haitians living in Canada who have already been expelled from this country or may possibly be expelled in the near future, and since their lives and security and those of their families would be in danger in Haiti, could the minister say to the House whether he has made or will make representations to the Haitian authorities so that our immigration legislation are well publicized in that country. That would be an act of basic humanitari-anism to plead the cause of those Haitian expelled from our country, in order that they may suffer no prejudice when they go back home. This is the question I ask the minister with the same sense of humanitarianism I had when I heard the answers of the Prime Minister in Paris, speaking of Chileans on French television.


Hon. Allan J. MacEachen (Secretary of State for External Affairs):: Mr. Speaker, I have not intervened with the Government of Haiti with regard to the persons who wish to return there and who may fear reprisals. I shall take under consideration the hon. member's representation which undoubtedly will be noted by the Haitian authorities themselves.


Mr. Speaker:: The hon. member for Annapolis Valley.


Robert Knight Andras: I rise on a point of order, Mr. Speaker, in response to the question of the hon. member in which he referred to the question of information given to Haitians in Haiti about Canadian immigration law. I think he should know, as I have been informed, that subsequent to the changes in respect of access to landed immigrant status by applicants within Canada the Haitian government published a full explanation of those changes in Canadian regulations in the newspapers in Port-au-Prince.
We sent an officer to Port-au-Prince who sought an audience and received about 25 tourist agencies and fully explained the regulations so that there would be a full understanding in that country of what access to Canada legally was.


COMMUNICATIONS
Mr. J. P. Nowlan (Annapolis Valley):: Mr. Speaker, my question is directed to the Minister of Communications. In view of the lengthy correspondence which he tabled in the House on Friday, October 25, indicating his point of view and those of other ministers of communications, can one assume that as a condition precedent of the next communications ministerial meeting there will be an agreement to have no discussion whatsoever on conflicts of jurisdiction between the authorities?


Hon. Gerard Pelletier (Minister of Communications):: I have already stated publicly, Mr. Speaker, and I see I must repeat it once more to answer the hon. member's question, that if the provinces want to amend the Canadian constitution, it is certainly not the Minister of Communications they must see, but the assembly of prime ministers.


INDIAN AFFAIRS
Miss Flora MacDonald (Kingston and the Islands):: Mr. Speaker, my question is for the Minister of Indian Affairs and Northern Development and it is with regard to the incident which took place in Hull last Saturday when an Indian Youth named Bill Blackned of Rupert House was allegedly brutally manhandled by the police. In view of the fact that the youth has studied at the Hull CEJEP under the auspices of DIAND, would the minister say if the department is investigating the incident and if the student is receiving legal assistance from the department?


Hon. Judd Buchanan (Minister of Indian Affairs and Northern Development):: The situation concerning this lad and the other one is being looked at by the department.


LABOUR CONDITIONS
Mr. Benno Friesen (Surrey-White Rock):: Mr. Speaker, my question is for the Minister of Labour. In light of the report made by Mr. Stanley Hartt, and in view of the impending national crisis facing us with an Air Canada strike, is the minister prepared to exercise his option under the Canada Labour Code and give his assurance to the House that he will not appoint boards and commissioners in labour disputes in order that crisis bargaining may be avoided?
Oral Questions


John Carr Munro: No, Mr. Speaker.


Benno Friesen: Is the minister prepared to take action to reinstate the conciliation stage as the truly last stage in the settling of labour disputes?


John Carr Munro: Each labour dispute deserves the treatment that the events which occur warrant. But I might say that when the hon. member puts forward a proposition of that kind, he should reconcile the various opinions that emanate from his own party.


POSSIBLE REMOVAL OF CROWSNEST FREIGHT RATE- REQUEST FOR STATEMENT OF GOVERNMENT INTENTIONS
Mr. Ray Hnatyshyn (Saskatoon-Biggar):: Mr. Speaker, I should like to direct a question to the minister in charge of the Canadian Wheat Board. It is with regard to remarks made to the Canada Grains Council as reported in today's press with respect to the matter of the removal of the Crowsnest pass rate. I wonder if the minister, having regard to the great uncertainty that his remarks have now caused the western farmer, will give serious consideration to making a definitive statement at this time with respect to the government's intention or else to the effect that he will lift this proposal and put it to summer fallow for good?


Hon. Otto E. Lang (Minister of Justice):: It would not be appropriate at this time to make a statement to the House in a formal way with regard to the government's policies, and I made it clear to the meeting in Edmonton that I was putting forward some ideas to be discussed by the Canada Grains Council and others. I made it emphatically clear at the meeting that this government was not moving away in any sense from the benefit of the Crowsnest rate in what I am suggesting. I suggested that I would not be a party to any such move that would lift the benefits, and this was the idea that I was putting forward, that the benefit from the Crowsnest rate to the extent that it is enshrined in our traditions might well be transferred to the prairie producers in a better way than through the inflexible rate itself. I emphasized that in my view any change would have to be enshrined in the statute to be useful.


John George Diefenbaker: It is just a double cross of the western farmers.


Ramon John Hnatyshyn: Would the minister give an assurance to the House that any suggestion or proposal with respect to the removal of the Crowsnest pass rate would not be made before the government is in a position to make a comprehensive proposal with respect to western transportation in general relating to the grain trade, and furthermore, not before every interested party and group in Canada will have had an opportunity to make full and adequate representation to the government?
28305-54'/j

October 29, 1974
Oral Questions


Otto Emil Lang: Mr. Speaker, hon. members are familiar with my strong belief regarding the putting forward of suggestions to the producers and receiving their views and consulting them in many different ways. This particular proposal is part of a three of four year review which has gone on with regard to our grain handling and transportation system. We are reaching the point of making some extremely important decisions about the future of that system, and any changes that might be made in the next months and years will require legislation in this place, at which time there will be an opportunity for more discussions. But the express point of my putting forward the idea before it is a firm proposal from the government is to encourage reaction to it. I still firmly believe that the transfer of benefits from the rate to some other form for the direct benefit of producers would be of immense advantage to them.


AGRICULTURE
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, my question is for the Minister of Agriculture who has just now disappeared from the chamber, but I will put it to the Prime Minister. In view of the fact that I have spoken to many farmers who have received as little as eight cents a pound for cows they have sold, and in view of the fact that farmers are now threatening to kill a lot of cattle across this country in protest, I should like to ask the Prime Minister whether or not this government will provide immediately some emergency aid to cattle producers so that they can keep their cattle and not deplete their herds.


Pierre Elliott Trudeau: The Minister of Agriculture has just returned.


Eugene Whelan: Mr. Speaker, the hon. member knows the position of the provinces in this respect, and I am sure he knows the position taken by his home province. They are asking us to share in their program with them; they seem to think it is satisfactory, but they must know that many cow-calf operators think it is unsatisfactory. Top grade cattle in Canada are selling at a higher price today than they have been for two weeks. We are working on a program which we think will supplement the programs that have been put into force by provincial ministers, but there are differences between the provinces. In fact, only two of the programs are similar, and three are very different. It is difficult to complement them.


Lorne Edmund Nystrom: The minister referred to some of the top beef cattle in the country. I was asking about cows that are selling as low as eight cents a pound and I was asking what the minister will do about this. For many weeks he had been saying he would do something; I want to know what it is. Is there aid coming or is there not?


Eugene Whelan: I would appreciate it if the hon. member would suggest some programs that he thinks might aid them.


Some hon. Members:: Oh, oh!


Eugene Whelan: I have always believed in consultation and I would accept suggestions. We have received many suggestions from the provincial people when they were here in October, but they were not unanimous on what should be done. If the hon. member can think of any programs that will aid cattle producers who are selling cows for the low price which the hon. member stated, I would like to hear of them because I do not know of any program that would take care of the situation. Most of them are culling cows from their herds as has been recommended by the provinces. They cull cows from their herds, and they are usually made into hamburger.


Some hon. Members:: Oh, oh!


Eugene Whelan: I would like to point out that some of the sirloin steaks and filet mignons also come from the eight cent or ten cent a pound cow and the restaurants were saying these were costing them $1 a pound last week by the carcass.


Lorne Edmund Nystrom: I rise on a point of order. I seriously suggested to you, Mr. Speaker, when members of the House, whether on the opposition or on the government side, ask a minister a question, it is the right of members of the House to have the minister answer that question, and this minister has not done that; instead, he has asked me a question. He wants me too suggest some alternatives to him. I can do that if you would give me the time to do it. In fact, I would be glad to suggest some alternatives to him. My point of order is that I think we in the House deserve to have ministers of the Crown give us answers when we ask them specific questions.


Some hon. Members:: Hear, hear!


TRANSPORT
Mr. Don Mazankowski (Vegreville):: Mr. Speaker, I should like to direct a question to the Prime Minister which is supplementary to that put by the hon. member for Saskatoon-Biggar. Can the Prime Minister advise this side of the House who we are to consider the official government spokesman on transportation matters? We have had the minister in charge of the Wheat Board indicating that the Crowsnest freight rates should be reviewed and he went into some detail on how that should take place. On October 23, at page 676 of Hansard the Minister of Transport indicated, and I quote:
-no one in my department, and certainly not in my office, indicated that we should modify the Crowsnest pass rates.
Who are we on this side of the House to believe?


Some hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Mr. Speaker, it is the practice in my government that minis-
October 29, 1974

ters are not prohibited from thinking about the future and this does not mean that the status quo will not be preserved in the meantime. Contrary to the Conservative Party, we are always thinking ahead and I do not propose to prohibit my ministers from doing that.


AGRICULTURE
Mr. Bert Hargrave (Medicine Hat):: Mr. Speaker, my question for the Minister of Agriculture relates to last Friday's trade information committee hearing in Washington that was convened to discuss Canada's cattle policies. In view of the alleged unfair and inequitable status of Canada's global quotas for cattle and beef, as charged by all six U.S. witnesses at this hearing; and since the minister or his department was not present at the meeting even as observers; and in view of the excellent and very well researched brief presented by the Canadian Cattleman's Association at this meeting, will the minister give the House some positive assurance that he intends to fully support the CCA brief in an effort to forestall almost certain quotas or embargoes on Canadian cattle and hogs entering the United States?


Eugene Whelan: Mr. Speaker, we followed the usual procedure with the representatives at the Canadian Embassy and a Canadian government representative was there to observe the proceedings. I might say that the Canadian Cattleman's Association brief was prepared in full consultation with our departmental people. I concur in everything they said and also disagree greatly with the American cattlemen's representations that were made according to reports I have received from my officials, and also I agree with the hon. member who asked the question.
+ * *


REGIONAL ECONOMIC EXPANSION
Robert Lorne Stanfield: Mr. Speaker, I have a question for the Minister of Regional Economic Expansion. I should perhaps first of all compliment him on his success in international diplomacy apropos of what the Prime Minister just said. I should like to ask the minister if he intends to appoint a chairman or chief executive officer of MAGI, a proposal which was put forward, I think, in the 1972 election campaign as something that would be set up immediately in the metropolitan Halifax area and was to be a great step forward. Can we expect an announcement this weekend at the DREE conference in Halifax and is there any reason why members of parliament are not invited or able to attend that conference?


Hon. Donald C. Jamieson (Minister of Regional Economic Expansion):: Mr. Speaker, there are several ele-
Trust Companies Act
ments in that question. When the hon. Leader of the Opposition talks about my success in international diplomacy I cannot tell whether he is referring to my activities in London or in St. John's Newfoundland, at the weekend.
On the question of MAGI I can advise that within the last ten days we have received the names put forward as directors of the corporation by the government of Nova Scotia. My recollection is that we are required to put up two additional names, and I see no reason why this cannot be done within a week or ten days. In that case the board of directors would begin to carry out the required search for a chief executive officer. On the matter of the weekend conference, if the hon. Leader of the Opposition or any member of parliament has not been invited I sincerely apologize. Of course, they are welcome.


Robert Lorne Stanfield: A supplementary question. In view of the fact that in the past the delay in setting up this MAGI was attributed to the difficulty of the minister and the Premier of Nova Scotia in reaching agreement on a chief executive officer or chairman, what is the great breakthrough now? How does the minister expect the directors to solve something that he and the premier could not solve face to face? And I am not getting mixed up in any international diplomacy in St. John's, Newfoundland!


Donald Campbell Jamieson: Mr. Speaker, on the question of procedure, over the past 18 months a number of suggestions have been advanced on how the search for a chief executive officer might be pursued. This was not successful. As the hon. Leader of the Opposition is aware, the government of Nova Scotia suggested that the directors be put in place and given the responsibility for the search. I am prepared to move in that direction and they have accepted the responsibility.


Mr. Speaker:: Orders of the day.



GOVERNMENT ORDERS


John Napier Turner: that Bill S-7, to authorize federal trust companies and loan companies to increase the monetary limit of their borrowing power and to issue subordinated notes, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.


Mr. Jack Cullen (Parliamentary Secretary to the Minister of Finance):: Mr. Speaker, this bill proposes to make certain amendments to the Trust Companies Act and the Loan Companies Act. These statutes provide for the incorporation and supervision of federally-incorporated trust companies and mortgage loan companies, respectively.

October 29, 1974
Trust Companies Act
Trust companies raise money from the public by accepting deposits and selling guaranteed investment certificates. Loan companies obtain their funds by the sale of debentures and the acceptance of deposits. For both types of companies the relevant statute places a maximum limit on the funds that can be obtained from the public. At present, this maximum limit is 20 times the company's capital and surplus, which can only be reached with the approval of the minister. The effect of these limits is to require the maintenance of at least a minimum excess of assets over liabilities to the public. This provides a safety margin in the sense that any asset losses can be absorbed first by this excess before any question arises as to the ability of the company to meet its obligations.
The maximum limit on the amount that any trust or loan company may borrow from the public was raised in 1970 from 15 to 20 times a company's capital and surplus. However, because of the rapid expansion being experienced by these companies, a number of them are now reaching the new limit. As a result, the companies requested that the existing capital margins be modified to enable them to continue to expand.
The government recognizes that a number of trust and loan companies are sufficiently sound, financially and from the standpoint of management, to justify some expansion beyond existing limits as previously referred to. In this bill we are, therefore, proposing that the Trust Companies Act and the Loan Companies Act be amended to permit a trust or loan company to borrow-in the case of trust companies it is more accurate to say that they accept money from the public in trust-in excess of 20 times a company's capital and surplus, subject to the adoption of an enabling bylaw establishing a new limit, which bylaw would have to be approved by the minister.
The authority to exceed the limit will also be subject to the ability of the company to meet a number of financial criteria that will be established by regulations. The amendment proposed would also empower the minister to require, as a condition of approving the borrowing bylaw, that some proportion of the additional borrowings in excess of the present limits be in the form of subordinated notes. This is desirable to ensure that a company retains an adequate margin of protection for, first, depositors; second, the holders of guaranteed investment certificates; and third, the holders of ordinary debentures.
As I have mentioned, the issuance of subordinated notes is part and parcel of the increased borrowing limits, and the bill would therefore expand the corporate powers of the companies to enable them to issue such subordinated notes subject to certain limitations designed to avoid confusion between the subordinated notes and any other instrument the company might issue to the public. I should mention here that these notes are intended primarily for sale to institutional investors and will only be issued in denominations of $25,000 or more.
Because of the rapidity. with which events seem to change in the financial world in current years, it is desirable to have some slight flexibility in the application of these limits. Because of rapidly increasing deposits or a drop in security values, a company may find itself at or

near its limits more quickly than might be expected. In order to provide some time to the company to arrange for additional capital or a modification of its pattern of growth, the bill contains two provisions that would, in certain circumstances, permit a company to accept funds in excess of limits otherwise applicable.
The first of these provisions relates to the amount off highly liquid assets, cash and government bonds, held by a company. A company would be given authority to accept funds from the public in excess of limits otherwise prescribed, to the extent that its highly liquid assets exceed the minimum prescribed by the act. The other special provision is that under terms and conditions prescribed by the minister, funds received by way of a loan from a shareholder or shareholders may be treated as though they were part of the capital for purposes of computing the limit on funds accepted from the public, provided the loan is made on terms subordinated to all other indebtedness of the company. It would be expected that the terms and conditions prescribed by the minister would be such as to make the use of subordinated loans in this way a temporary expedient to be replaced by permanent capital at an early date.
It occasionally happens that a company may find itself in excess of the limits imposed by the provisions of the act. Should this happen, the Superintendent of Insurance is required to report to the minister, and the minister may prescribe a time within which the company is to remedy the defect, he may impose conditions on the company or, in an extreme case, he may direct the superintendent to take control of the company's assets.
Some question has been raised concerning the obligation of a company toward its depositors and creditors in respect of funds received during a period that it is in excess of the limits otherwise prescribed. To remove any doubt on this score, the bill makes clear that in such case a company's obligations are not affected by the fact that it is in excess of those limits.
It is in the public interest that the amendments proposed by this bill be adopted, since trust companies and mortgage loan companies are an important source of funds for residential mortgages. The additional funds that these amendments, if passed, would allow them to raise would, of course, enable the companies to expand their lending activities while maintaining their financial stability. It might be of interest to note that at the end of 1973 there were 17 federally-incorporated trust companies with total assets exceeding $3.5 billion. This includes company funds and funds received in trust, the repayment of which is guaranteed. There were, as well, 14 mortgage loan companies with aggregate assets of approximately $3.25 billion.


Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, I wish to raise a preliminary matter before speaking to the actual bill. My suggestion might help to facilitate the business of this House. This bill was given third reading in the other place last Thursday or Friday. It was studied in a committee of the other place. Unfortunately, it will not be possible for us to obtain a transcript of the evidence taken before that committee until the end of this week. I know the purpose of the government, and commend it for initiating this kind of legislation in the other place. I think the Senate Committee on Banking and Commerce can do
October 29, 1974

an admirable job of investigating, questioning, and so on, with respect to legislation. The transcript of evidence taken before that committee would help hon. members of this House, in the same way as evidence taken before the Standing Committee on Finance, Trade and Economic Affairs is helpful to hon. senators. But to be helpful we must have those transcripts. Efforts must be made to speed up their release.
Owing to the change in the scheduling of this bill, backbenchers both on this side and that of the government are at some disadvantage in that we do not have the benefit of knowing what happened in the other place. I hope the government will initiate more bills there and I commend the government House leader for what he has done. However, I ask him to keep in mind what I have said and have someone on his staff see that transcripts of evidence from Senate committees come forward as soon as possible so we can use them.
My second point also concerns scheduling. This bill is to be referred to the Standing Committee on Finance, Trade and Economic Affairs. Government supporters on that committee should be interested in the bill and may want to hear this debate, but they are dealing with another bill this afternoon. The government has asked them to do this. The committee was supposed to sit tonight but for some reason the sitting was advanced to this afternoon. Three or four members of my party who should be attending that committee, which is dealing with the Federal Business Development Bank Act, cannot attend; they must remain in the House to deal with this particular bill. I ask for closer scheduling of these matters.
I also wish to comment on the order of business and I draw my remarks to the attention of the government House leader. I am referring to the many bills referred to the Standing Committee on Finance, Trade and Economic Affairs; there is a long queue of them. I do not think we are advancing House business simply by passing bills in this chamber and referring them to that committee, where they must remain queued up. Other House committees have nothing to do at present, and legislation could and should be referred to them. I know that this is sometimes difficult to arrange. In the previous session of parliament, of the first nine items six were sent to the finance committee. It had difficulty doing its work and government supporters on the committee and members from the opposition were very hard pressed.
Let me turn my attention to Bill S-7. Frankly, I wonder why the government has brought forward this bill at this time. It is some time since there was an examination of the business of banking and of the granting of credit in Canada. In view of rapidly changing events, and as conditions in the 1970s are far removed from those of the 1950s, I would expect the government to set up another commission of inquiry of the nature of the Porter royal commission on banking, which was set up almost 15 years ago. True, its findings were not handed down until 1964, but these things take time. I suggest that the government should give earnest consideration to again setting up such an inquiry, if the new Bank Act which I have discussed is to be brought in by 1977.
I do not think the public, the banking system or the government have sufficient information on hand to bring
Trust Companies Act
down the type of Bank Act we shall need in 1977. Conditions have changed immensely since the time amendments to the Bank Act were brought forward following the report of the Porter commission. I remember when the President of the Privy Council (Mr. Sharp), then minister of finance, brought forward those amendments. Even then I was concerned about a good deal of the philosophy embodied in the changes, even though the Bank Act was out of date. However, there were some steps forward.
With the greatest respect, all the government is doing with this bill is tinkering with one or two bolts in the machinery of credit granting and banking. After all, these trust companies do engage in the business of banking. We are not dealing with their powers as executors or their powers as mortgage companies to invest in realty mortgages. At this point we are dealing with the concept of a trust company as a credit granting institution. There is no way anyone can put it any other way; a trust company does engage in the business of banking.
As I said, this bill is a mere tinkering with a couple of bolts of the machine. It is not as serious as the tinkering that is proposed in Bill C-7, where there is quite a fundamental change of philosophy by introduction of the notion of partial public ownership in our chartered banks. That is something quite new, quite different; but it is tinkering of the worst kind. It represents moves now and then which are unrelated. Our entire credit granting and banking system in this country is far too complicated and far too important to engage in any of this ad hoc, unscheduled, uncoordinated tinkering.
Bill C-7 is only window-dressing in response to the premier of one province-possibly the premiers of two- having a delusion or illusion of grandeur. They feel they should be able to move in on one or more of the chartered banks. If and when Bill C-7 comes forward, we will have plenty to say about it. However, I feel this is a wrong step by the government in principle and philosophy in its strategy to deal with the banking system of Canada.
The parliamentary secretary was quite correct-there is no pretension of the legislation holding out more. This legislation will affect only trust companies falling under federal jurisdiction. In number they are small compared with the totality of trust companies operating in Canada. The biggest trust companies are not under federal jurisdiction. For example, the Royal Trust Company and the Montreal Trust Company escape the direct jurisdiction of federal legislation because they are provincially-incor-porated trust companies. True enough, there is some indirect control over them through the deposit insurance regulations, but that is a very untidy and improper way of dealing with the situation. These companies engage in the business of banking. My answer to this question is that there should be a general banking act defining the business of banking. Anyone, whether incorporated provincially or federally, would then have to submit to the jurisdiction of the act.
The Superintendent of Banking should be a much more active official, not merely a passive receiver of information from our financial institutions. We should have a much wider banking system which would permit mer-

October 29, 1974
Trust Companies Act
chant banking, for example. This would do away with the "suitcase banking" that has been going on in many areas. Foreign banks operate through agents coming into Canada as visitors; they set up in a hotel room. They are engaged in the business of banking in Canada but are totally beyond the reach of the Minister of Finance or any supervisory agency of the government. Something is wrong when we have this situation.
It seems to me there is a proper way to deal with these matters, and I will come back to this point time and time again. I thought I had the minister of finance of the day at least partly persuaded in 1965 and 1966 that we should have a general banking act with appropriate sections or portions applicable to our chartered banks. They are a category of banks. I would also like to see merchant banks and trust companies, in their banking functions, controlled under such an act. At the present time we do not have the necessary flexible instruments in Canada. The lack of flexibility is clearly pointed out by this attempt to introduce a degree of flexibility of formula with regard to expansion of the lending powers of trust and loan companies.
However, there is one point here that I do not like. There is no specific control on the limit of overborrowing by trust companies. It is at the discretion of the minister. Parliament is being asked to give a blank cheque. What will motivate the minister to exercise his discretion? How will there be any certainty in so far as the operations of trust or loan companies are concerned, which are, presumably, supposed to benefit from this feature of flexibility? Who is to determine who receives the favourable discretion of the minister? Is not overlimit borrowing providing a sort of bail-out mechanism by permitting an increase in debt? In the recent history of the United States permission was given to borrow over the limit in order to assist with a bail-out. However, it did not work.
There are, supposedly, regulations to determine the financial health of a company; however, these are not specified. There is no indication of the regulations. Without wishing to go into detail, I am dumbfounded by their range. We are being asked to pass this open-ended legislation without having a chance to see the regulations. It is possible we shall have the opportunity of learning at least something of the nature of the regulations in committee. In fact, the regulations may well have been drafted and it may be possible to submit them to the committee, as has been done in the past with legislation of this kind.
Here again, we are considering an increase in the lending and borrowing powers of loan and trust companies which are beyond the control of the Bank of Canada. This is strange. The government already finds it difficult to maintain adequate monetary control at this time of inflation, but the bill before us proposes extending the powers of institutions over whose operations it has little or no control as far as monetary policy is concerned. It gives them a free hand. The parliamentary secretary might care to comment on this point, or tell us that the Minister of Finance will have something to say about it. I think it is one which should be considered by the government even though the margin might in the over-all be negligible.

As I say, I do not want to go into detail now. A number of my hon. friends will have something more to say about this bill which was approved rather quickly in the other place. It will be some time before we reach it in our committee. I hope that later today we will complete this discussion and send the bill to committee. But that is the only undertaking I shall make at this time.


Lorne Edmund Nystrom: Mr. Speaker, the bill before us is to authorize federal loan and trust companies to increase the monetary limit of their borrowing power. As the hon. member for Edmonton West (Mr. Lambert) said at the outset, it applies only to companies incorporated under federal law. As far as I know, that involves only 17 trust companies with assets of $3.5 billion, and 14 loan companies with assets of $3.25 billion. So we are considering corporations with assets of slightly under $7 billion, according to the latest information I have received.
I wonder why this bill comes before us today, Mr. Speaker. It originated in the other place. I shall ask some serious questions about this measure and attempt to discover the motivation behind bringing it before the House of Commons at this time. Some of the information I have would lead me to believe that these trust and loan companies have been lobbying the government to get the legislation passed because their profit picture has been suffering. They are finding it necessary to pay more for money, and they are locked into mortgage contracts with low interest rates and five-year terms which they cannot escape. As a result, they are caught in a squeeze and their profits are not rising. If borrowing limits are removed, they can obtain more money and lend it at higher interest rates to compensate for the fact that a great deal of capital is tied up at lower rates. The fact that profits have been falling is one of the strongest motivations behind the presentation of this legislation.
The second reason for the bill is that trust and loan companies want to strengthen their place in the mortgage market. They have dominated that market for a number of years. Today, the supply of money is tighter; they want access to more funds; they want the ceiling to be raised so they can continue to dominate the market. This is an approach to which members of my party do not take very kindly. We believe that the federal government, representing the people, should be pumping millions and millions of dollars into the mortgage market at a low interest rate of, say, 6 per cent for people in the low or middle income groups. The money which the loan and trust companies are raising is going into the housing market at rates of 12 or 13 per cent, while interest rates on second mortgages are higher still.
The only motivation for putting this bill before us today is to fatten the profits of the trust and loan companies and to enable their shareholders to reap benefits at the expense of the consumer and the home builder. This bill will help to keep inflation rates high. It will help to drive up interest rates and keep inflation going. If it is passed and the companies expand their operations, they will be obliged to pay higher interest rates to depositors and bond subscribers in order to obtain more capital to lend. Corresponding rates of interest must then be charged on loans if desired profit rates are to be maintained. In other rates,
October 29, 1974

inflation will be reinforced and prospective Canadian home buyers will find their situation increasingly difficult.
I cannot see any reason at all why I, as a person who tries to represent the consumer, should support this bill. The only people who will gain through its passage are shareholders in the trust and loan companies. The hon. member for Edmonton West has drawn attention to other reasons why the House should view with concern the passage of this measure. We are asked to give a blank cheque to trust and loan companies in order to create more money during a time of inflation. I know the regulations will set out guidelines, but how will those guidelines be interpreted? This will be left to the Minister of Finance. No ceiling will be placed on the amount of new money which will be created. I do not like this sort of situation being created in a highly inflationary situation.
Finally, Mr. Speaker, the bill originated in a very undemocratic, corporate lobby-namely, the Senate. I do not like the idea of bills coming to this House from the other place. The position taken by members of my party is clear. The other chamber is a place to which members are not elected but are appointed until age 75. This goes against the grain.
When this bill was considered by the other place last week, the president of the Trust Companies Association of Canada testified before the Senate committee and spoke of the need for the bill. He pretty well admitted that the prime motivation for the bill was to facilitate the making of greater profits by the trust and loan companies of this country, since so much money was being tied up in mortgages at a lower rate of interest that was prevalent a few years ago. Mr. D. G. Neelands, president of the Trust Companies Association of Canada and president of Canada Permanent Trust, had this to say:
The trust industry ... is experiencing sumc	the prcec-*
time in terms of earnings because of the effect that rapidly rising interest rates have on spread. This is a matter which is obviously outside the industry's control and really the only-or major-defensive action or counteraction that the industry can take is to increase its volume.
The purpose of the bill before us is to increase the volume that is available to the trust and loan companies.


Mr. Gillies:: More money for mortgage lending is what the country needs.


Lorne Edmund Nystrom: My hon. friend from Don Valley (Mr. Gillies) says we need more money for mortgage lending. But, I ask, at what rate of interest?


James McPhail Gillies: The only way is to increase supply.


Lorne Edmund Nystrom: You will not increase the supply of houses until they are priced lower so people can afford them. You will not solve the problem simply by increasing the amount of mortgage money available at very high rates of interest, because people cannot afford to pay those rates. The President of the Trust Companies Association went on to say:
If you have a lower spread, but you have a larger volume, you can still maintain a reasonable level of profit. Therefore it is critical for compa-
Trust Companies Act
nies to be able to expand their operations, and many of the companies at the present time.. . are having difficulty with the 20 times limit. If we are going to be able to expand, as I believe we should be able to in the future, and to continue to make the major contribution which we, as an industry, have made to housing by making available mortgage funds in the recent times of difficulty in housing in Canada, then it is going to be essential for the companies to be able to expand their position-
Then Senator Hayden said:
I suppose, then, in another sense, you might put it this way, that the ability to expand would provide you with sources, or should, of money, so that you can get the benefit of the high interest rates that are currently in effect to offset some of the low ones that you are stuck with.
To which Mr. Neelands replied:
That is true-
I think it is obvious, from testimony like this and from other testimony given to the committee, that the prime motivating factor for this bill is the fact that the trust and loan companies of Canada are currently in trouble. They are asking that we remove the present ceiling so they can obtain and lend more funds, and in turn make a larger profit. I ask, for whose benefit? As far as I am concerned, it is not for the benefit of the home buyer or the consumer of this country. Our party has maintained for a long time that the way to solve the housing problem is not to make more funds available from mortgage companies at very high rates of interest but to put a lot of public money into housing. For too long the ordinary home buyer has been subject to the financial whims of the marketplace. Housing is a basic right of Canadians, not a matter that should be left to the whim of those in this country who control finance.
For that and other reasons, I cannot support the bill before the House. I see no way in which the bill will help the average person whom I try to represent in this House. I see no way in which the bill will facilitate the planning of our economy, the lowering of the inflation rate or aiiyihii.g that sort. The role,	nnrnnse of the bill
is to provide loan and trust companies in this country with access to more capital, so they can lend more money and compete with other financial institutions in making greater profits. I do not think this sort of situation will improve the living standards of ordinary Canadians.


Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, I listened to the Parliamentary Secretary to the Minister of Finance (Mr. Cullen) introduce this bill, and although I do not fault the hon. member for this, I found that the wording he put on the record was very strange. It was wording that could have been used 10 or 20 years ago, or perhaps in some other country today. For obvious reasons, the hon. member, or whoever wrote his remarks, chose to avoid talking about the real problems that are causing the government to introduce this bill.
The fact is that the government has tended, through its spending and monetary programs, to aggravate inflation in this country beyond reason. A consequence of this deliberate action is that trust and loan companies are finding it exceedingly difficult to remain competitive, to render the service that I suggest to the hon. member for the NDP who has just spoken they have been rendering, and at the same time to make a fair return, called a profit.

October 29, 1974
Trust Companies Act
I believe it is time we were a little more frank with the Canadian public.
Inflation today is a political problem, not an economic one. For the last four years the government has known perfectly well that steps should be taken to curb inflation in this country, yet it has chosen, I suggest egged on by NDP members, deliberately to throw out responsible fiscal and monetary measures of the kind that should have been implemented. As a result, the government has brought in a bill which, if you read between the lines, Mr. Speaker, is designed to correct the problems they know exist in a very substantial industry in Canada, namely, the trust and loan companies.
The figures are really startling. For example, the money supply in this country has doubled in four years. From the first quarter of 1970 to the first quarter of this year-the last available figures that I have-the money supply jumped from $12.5 billion to $25 billion. This is one of the root causes of inflation, and there is no way the government should be allowed to duck that fact. If one looks at the figures, one finds that trust and loan corporations have increased their assets, deposits and guaranteed certificates and debentures, along with most other financial institutions. However, I suggest-and I was very disappointed with the answer given me by the Prime Minister (Mr. Trudeau) in this connection-that it is now time for the government to commission an outgoing study of the Canadian banking and financial system.
In 1961 such a study was aked for, and it led to the Porter commission on banking. I believe they made a worth-while review of the trust and loan field, the life insurance field, consumer banking and the other financial sectors of our economy. But let us put it in perspective. At that time the baking industry in Canada had gross assets of about $20 billion. Today they are over $80 billion-four times the amount. One bank today, the Royal Bank of Canada, is greater in size than the entire banking community at the time of the Porter commission on banking in the early 1960s. Trust companies, likewise, have had phenomenal growth, as have the loan companies in the same period. For example, in 1964 the trust companies had guaranteed funds of $2.6 billion; at the end of 1973 their guaranteed funds amounted to $9.8 billion.
The funds of estates, trusts and agencies handled by the trust companies rose in the same period from $11.2 billion to $29 billion. In total, the assets of trust companies in Canada rose from $14.1 billion in 1964 to $39.7 billion in
1973.	The mortgage companies, or loan companies as they were called, had a correspondingly sensational growth, although slightly slower than the growth to which I have referred.
I would point out that a heavy proportion of that growth has been due to the inflationary policies followed by this government. This is the reason we are debating a bill that proposes to raise the limit under which the trust and loan companies may operate with regard to their deposits, guaranteed investment certificates and, in the case of loan companies, debentures. Surely it is time, again, to ask whether our banking system is working properly. Is it proper to have ten chartered banks at the present time, 63

trust companies, and a smaller number of loan companies dealing in somewhat similar activities and yet not all under the same act and not controlled by the same regulatory authorities? This is a question which has been raised many times.
I believe it is important for this House to consider whether it is time our banking institutions and our trust and loan companies were treated in a way that would allow them to be in a truly competitive position. In that way we might find that the type of situation with which we are dealing today would not recur as readily. The truth is-this came out during the Senate committee hearings- that the banks do not have these artificial limits. For example, they do not have to meet a limit of 20 times their capital. Why do the trust and loan companies have to follow such arbitrary limits?
I believe we should be asking ourselves whether previous parliaments were totally wrong when they said that trust and loan companies should be limited to 4, 8, 12'A or 20 times their capital. Were they totally wrong, when today we say we should have a very much looser system which is not open to decision by this House but simply to future drafters of regulations and some discretionary overseeing by the minister? Who is wrong?
I suggest that over the last ten years this government has systematically ignored the rule-book in order to suit its own political purposes as far as economics are concerned. Once you have abandoned sound monetary and fiscal policies it is only natural that you must come in with band-aid legislation such as this to repair the damage done to institutions in our financial system which have been caught in a difficult position. This government likes to take comfort from the fact that other countries are also in a difficult inflationary position. Let us face it: why should the government not take comfort from this fact? If one looks at the predominant government parties in most of the industrialized countries since the end of the Second World War, one sees they have been socialist, liberal, or democratic governments of the left. It is 30 years since the legislatures of our main industrialized nations became dominated by liberal, socialist or democratic governments of the left, to which I have referred.
I think it should be placed on record that in the United States, for example, the Democratic Party has held a majority of seats in both the Senate and the House of Representatives for all but four of the past 40 years. In Great Britain, Labour has had a consistent edge over the Conservatives since 1945, while in Canada only once in the past 39 years has there been a majority Conservative government: that was in 1958. I could go on and give similar statistics in respect of other industrialized countries.
1 suggest there has been a consistent move toward irresponsible fiscal and monetary measures in those countries. That is why the Minister of Finance (Mr. Turner) can almost take heart when comparing his record to those of his socialist, liberal and democratic friends who are to the left, in other countries. They all follow a "no rules" system so far as management of their monetary and fiscal affairs is concerned. Let me be more specific. Surely we should be asking ourselves, when we consider this type of legislation, why the majority of the trust companies in this
October 29, 1974

country are under provincial, rather than federal, jurisdiction. If one looks at the individual trust companies in Canada, one finds that very few are under federal control. Our bigger trust companies are provincially controlled.
Here we have a situation in which a very important sector, as indicated by the billions of dollars in assets which the trust companies control, is not wholly controlled by the government of Canada. That is a further reason for believing a Porter-like commission on banking would be a suitable study, rather than the introduction of legislation such as we are considering today in virtual isolation from the other ingredients of our financial community. In this bill-I hope this matter will come out in committee-I think it is interesting to note that we still refer to things called assets and liabilities and that there are ratios under which, say, 20 times your excess of assets over liabilities is the limit.
What is meant by assets? In an inflationary economy such as the government has triggered, what value is placed on an NHA, 6 per cent mortgage that has 15 or 20 years to run? Is it fair to show that item on your balance-sheet on a cost, or even on an amortized basis, when you know the reality is that if the mortgage had to be sold immediately it would have nothing close to an amortized or cost value? A look at our trust and loan companies will show that they are still reflecting their mortgages on a cost basis-certainly at the Ottawa level.
When this bill is considered in committee, I hope the minister or the officials of his department will explain the current position with regard to trust and loan companies. Do they, in fact, have an excess of capital over liabilities if true value is taken into account? I refer to the liquidation value of their mortgage portfolios and any other assets they have which are subject to today's market fluctuations. I would also point out that if one reads the annual reports of the trust companies, one finds that over the last few years there has been increasingly a comment in the reports to the effect that tney nope me government will quickly take steps to end inflation which is causing them distinct problems.
Guaranty Trust's annual report, for example, pointed out very specifically that they felt it was regrettable that so many people were, in effect, apologizing for inflation instead of taking steps to end it. They and the other trust companies involved are well aware of the devastation that inflation is inflicting upon the country.
In conclusion, let me say that we know this bill will go to committee and we can do nothing about it, but I suggest that we in this House can do something about the irresponsible actions of the government with respect to the economy. I believe we should ask ourselves: was it really necessary for government expenditures in the past ten years to soar by 330 per cent, if you exclude defence expenditures? That 330 per cent increase does not include such matters as the sixfold increase in our unemployment insurance benefits. I mention this because the 330 per cent increase this government has brought about in its own spending has contributed to inflation. The increase they have allowed has caused inflation, yet if we review history
Trust Companies Act
we find that the situation in which we are living is truly abnormal.
It is totally wrong for the government to indicate that somehow inflation is uncontrollable and that we must live with it. The fact is that you can go back literally 300 years in British history and you will find there never has been a period of inflation comparable to the present one, other than in wartime. Surely we must ask ourselves why, for a period of 110 years prior to the First World War, the industrialized countries of the world had a 3 per cent to 5 per cent interest rate structure, with very little inflation, and today we are told that we must accept a 10 per cent to 12 per cent interest rate structure, with a similar rate of inflation. The fact is that if this government had the courage, we could counteract inflation.
It seems to me that the type of bill with which we are dealing would not be necessary because the trust and loan companies could operate as well under a 20 times ceiling, without this type of escape valve, which would allow them to look after any immediate problems they may have as the result of inflationary pressures. I do not wish to delay the bill, but I hope we will at least undertake in committee a partial review of the situation. Most important, I urge the government, once again, to overview the entire financial system in Canada so that the whole country knows where it is going. I am very fearful of the direction in which the economy appears to be heading.


Mr. John Gilbert (Broadview):: The hon. member for Yorkton-Melville (Mr. Nystrom) set forth the reasons members of the NDP oppose Bill S-7, and the hon. member for York-Simcoe (Mr. Stevens) has set forth his doubts as to what is a reasonable amount by which trust companies should increase their credit as expressed in the formula defining excess of capital over liabilities. He asked whether that amount should be 4 times, 10 times or 20 times the present amount. I wonder whether he could have answered that question himself by telling us what limits chnnlH ho imposed on trust comnanies, because every month when we get the figures from Statistics Canada we find that the largest component of inflation is usually to be found in housing.


Sinclair McKnight Stevens: No, government.


John Gilbert: I say that interest rates are the largest component of inflation. It seems to me that the proper course for the government to take would be to impose a limitation on interest rates. There are three types of interest rates: rates for consumer loans, rates for companies, and rates for mortgages. We in the NDP would like to see a limitation on mortgage interest rates. If we support this bill, there is no guarantee whatsoever that there will be a downward trend in mortgage interest rates. In fact, I suspect they will increase because trust and loan companies have appealed to the government to change the limits imposed. I am sure hon. members have seen the big signs put up by some of the trust companies in certain cities across the country telling depositors that they will receive 11 per cent and 12 per cent interest on their money. There is only one result that can obtain from that type of advertising, that is, higher interest rates. The same result will obtain from the changes that the government intends to make. That is why we oppose them.

October 29, 1974
Trust Companies Act
Last Friday we heard the persuasive member for Don Valley (Mr. Gillies) attempt to convince the Minister of State for Urban Affairs (Mr. Danson) to remove the cyclical cost of housing from that spiral, especially with regard to interest rates. Today he thinks that if we support this bill and it is passed, there will be an increase in mortgage moneys which will bring down interest rates. If that were so, I would gladly support the bill. I would call to the attention of the hon. member for Don Valley the fact that the government used the same argument when they removed the ceiling from the bank interest rate. They said that once they removed that 6 per cent ceiling we would see a tremendous change in interest rates.


Mr. Knowles (Winnipeg North Centre):: We certainly did.


John Gilbert: We certainly did; it went up and up. Then we had the 25-year mortgages changed to 5-year terms to appease the mortgage companies, thus giving them the opportunity to change interest rates every five years and imposing upon borrowers the added worry and burden at the end of every five years that they would have to pay larger interest rates. The former member for Trinity suggested changing CMHC rates, and he guaranteed members of the committee that interest rates would go down substantially when the CMHC formula respecting interest rates was removed. Again, we had the similar experience of rates going up and up. Now, the CMHC rate is 11 Vi per cent, as I noted in today's paper, and conventional mortgages are 12 per cent and 13 per cent.
I would remind hon. members of the example I gave last week of a $35,000 mortgage. If a home buyer wanted to buy a house and assume a $35,000 mortgage at 11 per cent, he would have to pay every month, for principal and interest, the sum of $336.89. Over a period of one year the amount would be $4,042.89, and it would take the 25-year period to pay off the mortgage. At the end of 25-year period, the house purchaser would have paid $100,670, with an 11 per cent mortgage. Now the government brings forth another bill to permit loan and trust companies to increase their borrowing power so they can lend moneys at higher rates of interest. We are certainly opposed to that, Madam Speaker. We in the New Democratic Party feel there is a social responsibility on loan and trust companies and banks to put aside a percentage of their moneys as dictated by the amounts required for housing needs for the year, and we feel the interest rate should be no higher than 6 per cent. This would give the average working person an opportunity to buy a home and pay for it within a reasonable period.
I notice that the hon. member for Don Valley always likes to agree with my proposition that every Canadian is entitled to a home at reasonable cost and a reasonable interest rate, but when it comes to putting that idea into action, he and the Conservative Party fall short in their efforts to bring forth the philosophy which he seems to accept. We are opposed to this bill because of the results which will obtain. There will be higher interest rates for the average Canadian because the federal loan and trust companies will borrow moneys at higher interest rates and pass them on to the borrower who wants to buy a house.

We will not be party to this scheme. It would also give the provincial loan and trust companies an opportunity to change their legislation in the same way. It is not a good way to meet the problems of inflation and, more especially, the acute housing shortage of today. Madam Speaker, we are strongly opposed to this legislation.


The Acting Speaker (Mrs. Morin):: Is the House ready for the question? The hon. member for Halton-Wentworth (Mr. Kempling).


Mr. Bill Kempling (Halton-Wentworth):: Madam
Speaker, the question will be put in due course, I am sure, and the bill will go to committee at the appropriate time. Contrary to the opinions of some members of the New Democratic Party, I do not object to the fact that this bill originated in the Senate. I find no fault with that procedure, because the Senate has time to consider measures such as those put forward in the bill. I do object, however, to the lack of information with regard to this bill. I am somewhat annoyed that we have not been given its background.
The Senate had meetings and hearings at which there were witnesses. As the hon. member for Edmonton West (Mr. Lambert) pointed out, we in this House are not given the opportunity to study the evidence presented to the Senate committee. Surely the Minister of Finance (Mr. Turner) could have put together some information for us so we could adequately examine the various facets of the bill.
This bill pertains only to trust and loan companies that are federally chartered, Madam Speaker, so the first thing we have to ask is, what about provincially-chartered companies? Has there been any liaison or discussion with the provinces on this matter? Are they going to bring forward parallel legislation in the near future? The activities of trust and loan companies figure very prominently in the monetary life of this country; they are a very powerful force.
Anyone in the mortgage field knows very well that these companies are in great difficulty today because of lack of funds. This legislation will allow them to increase their borrowings so that they will have the funds to lend. I cannot find fault with their having more funds, because one of the complaints from those who are concerned with housing in this country is that not enough mortgage funds are available. They claim this is creating the high interest rates we are faced with. So we can hope that if more funds become available, interest rates will come down and the housing market will be assisted.
My concern, Madam Speaker, is that we do not seem to know where we are going in the over-all banking field. Let us face the facts of life. Trust and loan companies are competing with the banks for deposits with which to operate their businesses. Across this country we have the chartered banks, 65 or 75 trust companies, a number of loan companies, credit unions, and venture capital firms of all kinds. It is obvious to anyone who has even a nodding acquaintance with the financial world that trust companies and banks are caught up in inflation. It is time, therefore, the minister considered setting up another royal commission on banking. Perhaps the way to start would be

with a preliminary inquiry conducted by the Senate, and then to have a full-blown royal commission.
Madam Speaker, I should like to quote from the 1973 annual report of the Guaranty Trust Company which indicates that company's concern. The report points out that we were faced, in 1972-73, with great legislative uncertainties. That is a polite way of saying they are very concerned about the level of inflation in this country and what is being done about it. The report opens by saying:
The 1972 report to the shareholders noted that, "with the large increase in money supply that has taken place in 1972 and the possibility of a continued substantial increase in 1973, there is a great danger of sharp increases in inflation and, therefore, interest rates-
The report refers to 1972 inflation rates, which were not nearly as high as they are today. I continue:
-as 1973 draws to a close and the third successive year of economic growth ends. It is possible that 1974 will see the end of the current cycle of growth and this may coincide with high inflation and high interest rates."
This assessment, while generally correct, did not anticipate the magnitude of the increase in both interest rates and inflation that faced the company this past year and that faces the company in the future.
As senior officers of a company which invests money on behalf of other people, we are concerned by the fact that so many people seem to be taking this rapid increase in inflation for granted. The Economic Council of Canada in its recent annual report said that Canada should merely outperform its neighbouring countries in this respect. So far, the country seems to be able to tolerate without any great social unrest a rate of inflation between 5 per cent and 8 per cent.
Inflation is now running at 12 per cent and may reach 14 per cent. That is intolerable. The report continues:
We do not know whether inflation can be kept this low. We rather doubt it and we do not know what kind of further social distortions will take place if inflation moves up to rates in excess of 10 per cent annually and middle income savings become subjected to confiscation by this rate of inflation.
The author of this report was a prophet. Today, mortgage funds are almost non-existent at rates which the average Canadian can afford. Now we have a bill before us which seeks to increase the borrowing level of trust and loan companies. That is how the government is trying to deal with the situation. We must go much further and consider the serious questions facing our entire banking structure. I am disturbed when I see advertisements dealing with guaranteed deposit certificates. What do they guarantee? They guarantee only the interest rate. Really, they guarantee the interest, and nothing else. I think that is intolerable.
Trust and loan companies are operating in the banking field. Legislation which controls banks guarantees the security of deposits. In this instance we are debating a bill which deals with guaranteed deposits, yet the guarantee really means nothing. Passage of this bill will increase the work load of the Department of Insurance because, obviously, more personnel will be needed in that department to supervise the operations of trust and loan companies.
It must be obvious, Madam Speaker, that we are fumbling around in speaking to this bill. The reason is simple. We have available absolutely nothing to help us debate this legislation. We are asked to rush this bill through without being able to make an effective contribution to
Trust Companies Act
the debate. I hope that when the bill is discussed in committee the minister will make information available. In that way we could pass this bill rapidly, which I believe is what the minister wants. We can only discuss this bill intelligently if we have available adequate information.
This bill will increase the power of trust and loan companies which are not under the direct control of the Bank of Canada but which compete with banks in the field of banking. As I said earlier, the bill will apply to federally-incorporated institutions, and it is assumed that appropriate provincial legislation will follow. Let me ask this question: what steps has the government taken to make sure that legislation like this is applied uniformly across the country? How can we be assured of uniformity of legislation governing trust and loan companies? Certainly, the largest companies in the field are provincially-chartered. We should have before us information showing that the minister and his staff have discussed the matter with the provinces and that parallel legislation will be brought forward by the provinces, thereby bringing uniformity to the operations of trust and loan companies.
This bill will lower the safety margins of companies at a time when their assets are declining and their liabilities increasing directly because of inflation. Previous speakers have dealt with overlimit borrowing and the bail-out mechanism which will permit an increase in debt. In committee we shall consider this subject carefully to see what safeguards are included in the bail-out mechanism.
One feature of the bill which bothers me is that it puts so much power into the hands of the minister. There is no specific overlimit with regard to borrowing; this is left to the discretion of the minister. The minister may increase or reduce the authorized ratio of borrowing. Here, again, we see great power vested in the minister. I think that power should be vested in the House of Commons, which should consider this matter. This sort of thing is happening with many bills which are debated in this House. I suggest that we may De abdicating out tco^uivsibilitics. Wc are putting power into the hands of commissions and ministers of the Crown which should rightfully remain vested in the House of Commons. I deplore this, Madam Speaker. Sooner or later we must deal strongly with this situation.
Why am I raising these objections? Consider our mess in transportation as a result of power being vested in the Canadian Transport Commission. The bill which the House considered immediately before this one dealt with amendments to the Combines Investigation Act. The government suggested, through the medium of that bill, that great powers should be vested in the Restrictive Trade Practices Commission. Yet here we are discussing another piece of legislation under which power to increase borrowing limits is left to the discretion of the minister. I ask, to what extent can such discretion become a tool of monetary policy? We must consider this question seriously. The regulations concerning the financial health of the company are not specified, and they are discretionary.
This bill, I know, will be referred to the standing committee at five o'clock.


Otto Emil Lang: Would you like to pause for a few minutes? Take a deep breath.

October 29, 1974
Trust Companies Act


William James Kempling: I should like to, but we have 30 minutes to go.
Madam Speaker, I am concerned about the lack of adequate information which is necessary if we are properly to consider this bill, instead of sort of floating around and talking in this fashion. I refer to a suggestion put forward by previous speakers. We need to have established a royal commission on banking which will consider the whole field of banking, trust and loan companies, the way credit unions across this country operate, and venture capital operations. I am supposed to be in committee this afternoon where they are discussing Bill C-14, the Federal Business Development Bank Act. It is time we had before this House a mechanism whereby we could set up a royal commission to study the whole matter of banking, nearbanks and merchant banks.
In my own private business, I had to go to London, England, to find a merchant bank with which to do business because we could not find adequate facilities in Canada to carry out the type of transaction in which we wished to engage. It is time this type of action was taken by the government. We should take a good look at the total financial structure of the country as far as banks are concerned, and do something meaningful to supply money to the mortgage and general business fields.
In the twenty-ninth parliament we passed legislation setting up a mortgage investment corporation. I am sure the minister has noted that very few of these companies put shares on the stock market because the market is at such a low ebb. They are now endeavouring to improve the situation in the mortgage field with Bill S-7 which will increase the borrowing limits of the various trust and loan companies. In conclusion, I say to the Parliamentary Secretary to the Minister of Finance (Mr. Cullen) that it is a poor show that more information was not provided. We implore him to ensure that adequate information is placed before the committee at the time it considers this matter.


Mr. Bill Jarvis (Perth-Wilmot):: Madam Speaker, I had not intended to participate in this debate. However, I have been inspired to do so by at least two factors. The first was well expressed by the hon. member for Halton-Wentworth (Mr. Kempling). I can well imagine the embarrassment of the Parliamentary Secretary to the Minister of Finance (Mr. Cullen), knowing his feelings of understanding and sympathy toward his colleagues who would have liked an opportunity to examine the background material which gave rise to this legislation. Had we even seen some of the material that was available to the Senate committee, this debate would not only have been more meaningful but more helpful to all concerned. I can appreciate the embarrassment of the parliamentary secretary, because he was the spokesman for the government on this occasion, and he knows that hon. members-himself included-had very little opportunity to prepare themselves.
Second-and I hope I do not have to apologize for being parochial-the matter of trust and loan companies is very personal to me and, I think, to many others from western Ontario. We-I include the parliamentary secretary-went through the traumatic experience of the failure some years ago of a very prominent trust company in our part of

Canada. It is easy for those of us who have practised law to regard a trust or loan company in a very narrow legal sense. Indeed, it is possible for those who have engaged in real estate, either as a member of the real estate profession or in conjunction with associates, to regard a trust company as merely a source of borrowing mortgage or shortterm funds. It is very easy for those of us who have the affluence with which to make substantial deposits to simply regard trust companies as a depository for those funds. However, I say to all hon. members that the ordinary Canadian, if indeed those whom I represent in Perth-Wilmot can be classified as such, regard a trust company as much more than that.
Those of us in western Ontario who invested funds in the company which failed some years ago regarded a trust company as almost akin to the Bank of Canada, not just for their deposit receipts, savings accounts or guaranteed investment certificates, but if one owned a share in a small rural trust company it was regarded as being almost fully guaranteed by the government. Shares in small trust companies, particularly those that were rurally-oriented, passed from generation to generation. I suspect this is true not only of western Ontario but of many parts of Canada.
The trauma and disturbance, not only to the economic community when one of these trust companies fails, is something you have to experience to appreciate. In the city of Stratford, people rushed to the trust company and literally took out suitcases full of money, for fear they would lose their entire savings. Loan share values went overnight to one-twentieth, and indeed one-fiftieth of their previous high values. When talking in terms of trust companies, I hope my colleagues will not regard them simply as financial institutions, because in many cases they are community institutions.
With regard to this legislation, I deplore the fact that it is prompted out of sheer necessity created by the cancer of inflation. No doubt we will have further legislation of a similar kind, because trust and loan companies find themselves in the horribly difficult position of having to pay tremendously high interest rates on even short-term money while at the same time trying to operate in a successful manner.
The hon. member for Broadview (Mr. Gilbert) quoted some very interesting statistics on what it would cost a home owner with a certain mortgage at a certain interest rate. Statistics like that have been given for years and years. They are always intended to create horror. On the first home I bought, the interest rate was 4 Vt per cent. My wife and I sat down one evening to figure out what it would cost us over the 25-year amortization period. We were just as horrified by the figure 25 years ago as the figure given today might horrify people. But that is not the crux of the situation. The difficulty in which we find ourselves, in October, 1974, is not the horror created by those figures. The difficulty is that six potential home owners who wanted to buy a home in my constituency were turned down by a trust company because they could not qualify for a mortgage. That is the horror, not the arithmetic which the hon. member gave us this afternoon. It is that these six families who wished to invest in their community by owning their own home were turned down by the same trust company. If the members of the New
October 29, 1974

Democratic Party are going to be horrified, let them be horrified by the fact that their fellow citizens in every community across Canada are not allowed to invest in their communities by investing in homes.


John Gilbert: Even if they qualified, they would not be able to pay for one.


William Herbert Jarvis: No statistics have proved to me that foreclosures, powers of sale and revocations are increasing. What is decreasing is home ownership in Canada.


Some hon. Members:: Hear, hear!


William Herbert Jarvis: I question the sincerity and integrity of the members of the NDP. If they are going to use this abundance of energy to worry about their fellow citizens, they should worry about the fellow who wants to buy a home. I appreciate your indulgence, Madam Speaker, because I know I have gone far afield; but I was prompted to do so by hon. members to my left.
As we all know, this legislation applies only to federally-incorporated institutions. My concern is this: our fellow Canadians do not know whether a trust company is federally incorporated or not. I do not think they care, and I do not think there is any reason they should care whether a comapny is federally incorporated. Their concern is with the solidity and integrity of the institution. I am disappointed the parliamentary secretary did not give us an indication of the likelihood of the provinces adopting identical or similar legislation in this regard. This information is, almost certainly, available to the minister. I presume there has been consultation, or at least some correspondence, on this subject between the minister and his provincial counterparts. I trust the parliamentary secretary will clarify this aspect of the matter before the debate is over.
With regard to ministerial discretion, I would only remind the parliamentary secretary of the days he and I spent in law school studying the effects of ministerial discretion under the Income Tax Act. I think every professor of law has impressed upon students the dangers of ministerial discretion. I make no comment with regard to this particular example, except to say I can hardly believe the parliamentary secretary would accept another encroachment upon our statute books, by way of ministerial discretion, without making any protest.


Lincoln MacCauley Alexander: Yes, he would; he's a Liberal.


William Herbert Jarvis: I am sorry, too, that the parliamentary secretary did not give us any assurance as to the capacity of the Department of Insurance to undertake the increased work load this legislation involves. It is my experience that this vital group within the government service has probably been as understaffed as any. This afternoon might have provided an opportunity for the government to tell the House whether this group would be given the staff it needs and the wherewithal to carry out its tasks effectively. I suspect we cannot take much comfort in the protection afforded us by the Department of Insurance with regard to continuous inspection of the institutions which fall within its jurisdiction.
Trust Companies Act
In conclusion, may I say two things: first, I deplore the paucity of material which was made available to us as a basis for making a meaningful contribution to this debate; second, I would hope that in considering this legislation we would look upon loan and trust companies, not as just financial institutions but as valuable institutions within the life of our community.


John Patrick (Pat) Nowlan: Mr. Speaker, I, too, welcome the opportunity to take part in this debate on Bill S-7, a complex and technical measure increasing the powers of federally-incorporated trust and loan companies. There are a number of things I should like to say about this bill, but at the outset I should like to compliment my hon. friend from Perth-Wilmot (Mr. Jarvis) who has just put some pertinent questions to the parliamentary secretary about certain features of this legislation. The hon. member succeeds Mr. Monteith, who was for years financial critic for the Conservative Party in Her Majesty's Loyal Opposition. I believe he acquitted himself nobly in analysing a bill of such financial complexity and putting specific questions to the parliamentary secretary. Whether he will receive pertinent and specific answers to those questions is not certain, but in any case I wish to compliment him before I proceed.
The fact is that the bill would give the minister discretion to increase the borrowing limits of loan and trust companies to the extent of approximately 20 times the excess of assets over liabilities. This can be done provided the minister is satisfied the company complies with regulations which he himself has laid down. I can remember an occasion, not too many years ago, on which there was a debate in the House on an amendment to the Excise Tax Act. It was proposed that the then minister of finance be given discretion to decide whether an article which entered this country was of a class or kind similar to that already made in the country.
The opposition at that nine, wiiii.Ii mciuucu oCmC, if only few, of those who are sitting across the way this afternoon, castigated the minister of finance for wishing to assume unusual and dictatorial discretionary powers. Indeed, the Pickersgills and Chevriers of that day said the proposal would give power to the minister of finance never previously conferred upon ministers in times of peace. Yet here we are, giving the Minister of Finance (Mr. Turner) power to decide whether certain loan or trust companies shall be allowed to extend their borrowing limits in the absence of any real checks or balances such as ought, in my view, to be exercised either by the finance committee or by some other body.
We are also asked to consider a new procedure allowing for the issuing of subordinated debentures. This will add a new dimension to an already complicated field. Before examining the merits or demerits of some of these proposals, I should like to say four or five things. First, condensing what some of my hon. friends have said about being caught with some of their digits down, or their balance-sheets exposed, because of the unusual circumstances in which we are debating this bill right now, I would like to take a different tack: I think it is deplorable to call a financial bill for consideration in this chamber when a committee of the House charged with considering

October 29, 1974
Trust Companies Act
matters of finance is discussing another financial bill in a committee room some doors down the corridor.


Some hon. Members:: Hear, hear!


John Patrick (Pat) Nowlan: As we all know, there are many claims upon the time of a member trying to do his duty, as between the House, his office and the committees. At least one of his problems could be resolved if care were taken not to schedule committee meetings at the same time as a similar subject matter is being considered on the floor of the House. For example, I see the Minister of Finance is not here today and I know that his parliamentary secretary, the hon. member for Sarnia-Lambton (Mr. Cullen), is an illustrious member from a riding in Ontario. He was the eminently fair chairman of a very difficult committee during the last session of the previous parliament. I do not detract from his stature one whit, but the fact of the matter is that since the Minister of Finance is not here, his parliamentary secretary is in charge-a practice that I think is deplorable.
The second reason I rise to participate in this debate is that the bill comes from the Senate. One of my colleagues to my left, the hon. member for Winnipeg North Centre (Mr. Knowles), has carried on a personal crusade, suggesting that the other place be substantially altered in a most fundamental form, namely, by terminating that legislative body.


Stanley Howard Knowles: Hear, hear!


John Patrick (Pat) Nowlan: He wants to extinguish, to abolish, the Senate. To some extent I share the hon. member's sentiments. We have talked about reform of the Senate until we are blue in the face. For the life of me, I cannot understand why a Conservative, with only 17 good gentlemen in the Senate, should continue to put up with the charade that we have a chamber of sober second thought. Out of some 102 senators there are only 17 good, true men. The only reason I mention this is that the bill has come from the Senate and I do not have too much opportunity to comment on the Senate. Nevertheless, a good many senators themselves feel that it is time fundamental reform of the Senate was made, and to me the only fundamental reform is abolition of the Senate.


Mr. Guay (St. Boniface):: You may hope to get there.


John Patrick (Pat) Nowlan: The hon. member for St. Boniface (Mr. Guay) may find another chamber in which to participate at some stage of life, be it high or be it low; but he will participate well and energetically in any chamber. While I may have some personal views as to the utility and, frankly, the rationality of the Senate as presently composed, notwithstanding some of the so-called reforms of the Prime Minister (Mr. Trudeau), the Senate does do some good from time to time in considering details of bills of a technical nature.
I have said enough about the Senate for the moment. We all seem to think that the world will stop turning if the Senate is abolished, but there is not a province in Canada that did not once have a legislative council. Even during the long years the hon. member for Yorkton-Melville (Mr. 
Nystrom) has had in this place, the legislative council of Quebec has seen the axe under Premier Lesage, a member of the same party as hon. gentlemen opposite. Those members are not too consistent in some parts of Canada, but they do have certain power in other parts, and I think they should use some of that power to do something sane and sensible regarding the Senate.
Coming to the bill, Mr. Speaker-


Stanley Howard Knowles: Why bother?


John Patrick (Pat) Nowlan: -if I thought that this bill would in any way help increase money supply to the young, farmers, small businessmen or tradesmen, then I would be ecstatic about it. But I doubt how it is going to help those people who cannot get funds no matter what their station in life. As my hon. friend from Perth-Wilmot said, we all know inflation is the cancer of our society today, and interest rates are the arteriosclerosis of our economy. As arteriosclerosis chokes off the arteries of humans, so inflation and the exorbitant, almost usurious, interest rates charged Canadians-be they tradesmen, small businessmen, farmers or fishermen-delay plans for production, thus causing lay-offs which even today are increasing. Our economists today debate whether we are in a period of inflation, stagflation or recession. There are as many opinions about this among economists as there are opinions among members of parliament about the efficacy of some of the procedures in this chamber.
I am less than enthusiastic about this bill because, as so often, the government has failed to do some joint planning with the provinces on the question of monetary policy as it relates to trust and loan companies. In this respect we have had only silence. There has also been a vacuum in many other areas of federal policy and leadership, In fact, the economic philosophy of this government can be sized up in two or three phrases, phrases we ran into again today during the question period. Whether it is the grain handlers who are holding study periods, or Air Canada pilots who are threatening to go on strike this weekend, the philosophy is catch up, catch up, catch up. When one group catches up with inflation, every other group starts to fall behind; and when all other groups try to catch up, the whole country starts to go down the drain.
If the parliamentary secretary had a voice, had some sway, among his colleagues, then he might bring some sense to them through his persuasive powers and the tremendous stature that he has in the House. But the fact is that he is only a parliamentary secretary. The Minister of Finance and the Prime Minister are meeting the premiers tomorrow, yet they do not have a comprehensive plan in mind for anything at all. All they have is a fly-duster to take care of housekeeping chores.
I say the sooner we get this bill to committee, where it will be given detailed examination to see whether some of my fears are realized regarding the money supply and high interest rates, the better, Mr. Speaker.


Mr. John Rodriguez (Nickel Belt):: Mr. Speaker, having looked over the bill and heard some of the debate, I am led to think that if my colleague from Broadview (Mr. Gilbert) and some of his compatriots were to write another

operetta based on this bill, they would have to call it "The Pirates of Finance".
I see it is five o'clock; may I call it five o'clock, Mr. Speaker?


MESSAGE FROM THE SENATE
Mr. Deputy Speaker:: I have the honour to inform the House that a message has been received from the Senate informing this House that the Senate has passed Bill S-ll, an act respecting the British Columbia Telephone Company, to which the concurrence of this House is desired.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: 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 St. John's West (Mr. Carter)-External Affairs-Extension of jurisdiction over coastal waters-Possibility of unilateral action; the hon. member for Hillsborough-(Mr. Macquarrie)-Storms-Altantic provinces-Request for aid from Prince Edward Island. [English]
It being five o'clock p.m. the House will now proceed to the consideration of private members' business as listed on today's order paper, namely, public bills, private bills, nonces of motions.



PRIVATES MEMBERS' PUBLIC BILLS


Mr. Max Saltsman (Waterloo-Cambridge) moved: that Bill C-202, to amend the Canada Pension Plan (housewives' contributions and benefits), be read the second time and referred to the Standing Committee on Health, Welfare and Social Affairs.
He said: Mr. Speaker, the purpose of this bill is to enable housewives to make contributions to and collect benefits from the Canada Pension Plan. Since many housewives spend part of their careers working in industry as well as working at home, they should be permitted to continue their contributions to the Canada Pension Plan while at home to ensure them a full pension at retiring age. The bill
Canada Pension Plan
recognizes the equal importance of work performed at home with the work performed in industry and provides housewives with the same pension opportunities. The plan is voluntary and housewives are designated as selfemployed contributors paying the contribution of the employee as well as of the employer at the rate of their choice, up to the maximum.
Let us face it: in this country we can be very proud of the old age pension that has been a part of our life now for many years. We merely have to look back to the days when people reached old age and did not have security, to see how far we have come. Nevertheless, a great deal remains to be done. The old age pension is not high enough: it should be increased. The eligibility age should be lowered. People should be able to receive benefits at age 60.
A third point is that the Canada Pension Plan should be made applicable fairly to women and others outside the labour force. It is this third point which is the purpose of my bill. It could be argued that the Canada Pension Plan is not in the same package or is not in the same range as the old age pension; that the Canada Pension Plan is a work-related pension and that women who are not in the labour force, or others who are not in the labour force, should not have a claim on it.
When the plan was introduced, the argument was made that it was an actuarially sound plan. I do not think the Canada Pension Plan can be looked upon in that way. There is little relationship between the contributions and pensions. There is some relationship between the contribution the person makes and the pension he receives, but anyone can see there is a great benefit for people in a certain age group.
Anyone over 50, certainly, receives outstanding benefits from the Canada Pension Plan, when eligible, compared to a younger person. Our younger people are expected to contribute more to the plan than they could receive. They will have to nav a ereat deal more than they would have to pay for similar benefits in a private plan. There is a cross-subsidization in the Canada Pension Plan which in fact makes it a social plan rather than a straight plan or an actuarially-based plan.
The plan has been in operation since 1966. If a person were retired who had been paying in during these eight years, he would have paid in something under $800- actually, $779.40. He would begin to draw, in this year, $103 a month. This means that in less than eight months that person would have recovered all the contributions he had made to the plan. That is a pretty good deal for a person who retires at this particular time. It is pretty difficult to argue that this is an actuarially-based plan, because it was obvious from the day it was incorporated that people at certain age levels would receive considerable benefits.
Since it is an income support program in many ways, and since it involves a considerable subsidy from one element of society to another, why should housewives be excluded from the plan? What is the justification for saying it is strictly a work-related plan and, therefore, housewives who are supposed to be outside the regular work force have no claim upon it because they are not working in a factory, in the field, in construction or in

October 29, 1974
Canada Pension Plan
some other kind of industrial work? It is just not so. It is obviously a transfer payment.
The other argument is that it makes what I believe is a very serious distinction since it talks about work and refers to work related to industry. It would seem to be suggested that that type of work is fare more valuable in this country than work carried out at home. That is sheer nonsense. All of us recognize that that is not so, and that in fact the contribution of women in respect of raising children and maintaining a household may be far more valuable, in terms of the future of our country, than some obscure job or activity that men or women are now involved in.
There are many inconsistencies to be pointed out. I shall take just a few. Some men work very hard. I think most people in industry work pretty hard. But others have what are called very soft jobs, yet they can contribute and draw a pension because there is no way to evaluate such employment; there is no way of evaluating whether a person is working hard or has a very pleasant or unpleasant occupation. This bill does not, and should not, go into that because it is a very difficult judgment to make.
In some cases, however, we know that people are paid for doing work which is almost like leisure. Some people may put in only a couple of hours a week, yet they are in a position to draw full benefits. On the other hand, all of us are aware of women who on their own may raise a family of one, two or three children, which is a terribly difficult task. Why should such a woman not receive any benefit from the Canada Pension Plan? It seems to me that is a terribly unfair situation.
The Canada Pension Plan is a great improvement over what we had before it. I think most people feel it has worked out quite well. However, there are significant problems in respect of the plan. There are problems of equity and fairness about which I believe we should do something. The things I have said in respect of women apply to low earners and other people outside the labour force. Some men or women may not be in the work force because they are crippled, they may have disabilities which prevent their working, or they may have been ill during the latter part of their lives and therefore have not made contributions to the plan. These people are excluded from the plan. The same principle of unfairness applies in their case as in the case of housewives.
The Minister of National Health and Welfare (Mr. Lalonde), on behalf of the government, has made a number of statements and has introduced legislation. He recognizes that this kind of anomaly exists. He has made a number of proposals to the House. It seems to me that none of those proposals is very satisfactory. They do not take into account some of the questions about fairness which arise in respect of the Canada Pension Plan. The chief proposal seems to be to take the amount of money that would normally go to the husband, and perhaps in some cases the wife, and split it so that each spouse receives an equal amount. That may satisfy a few technical draftsmen, but it will not change the picture very much, because all that will be done is to take from the husband in order to give to the wife; and that cannot be considered a very satisfactory arrangement.

The truth of the matter is that we really find it difficult to know how to correct these anomalies in the Canada Pension Plan. This leads me to the conclusion that either the government must find a way which will permit housewives and others to make contributions to and receive benefits from the plan on retirement on the same basis as those who are employed, or we may seriously have to consider-and I am certainly prepared to consider it-that the CPP and old age security program be combined into a universal pension at a much higher level. I mentioned that perhaps housewives and others should be subsidized by the government, but even if we have to subsidize some of the others-for instance, if there are poor people in our society who do not have the money to make their own contributions to the CPP-some method should be found to do it on their behalf.
I do not deplore the fact that we broadened the Canada Pension Plan; that may have been the only thing possible at that time. I know that my friend, the hon. member for Winnipeg North Centre (Mr. Knowles), had a number of proposals which were better than the present CPP, but they were not acceptable at that time. There were problems with the provinces in trying to get their agreement on whether we would have a "pay as you go" plan or whether the plan should be funded.
A compromise was reached. Instead of a 20-year funding, we had a 10-year funding, but the "pay as you go" plan did not receive the support of the provincial governments. So it has come to the point where we have to review everything we are doing in the way of providing a pension for our senior citizens. Because if there is one thing that Canadians seem to agree upon, it is that we must look after the people who have spent so much of their lives in building up this country and providing the infrastructure and benefits which we have inherited. The Gallup polls which have been taken show that of all the programs, the one that is most universally admired and accepted, and the one that people are most willing to enlarge, is old age security.
I ask hon. members to consider this and, because of the importance of doing more for those who are retiring, to find a way of letting this private member's bill go to committee so that we can at least examine the serious questions that arise as a result of the present unfairness of the Canada Pension Plan.


Mr. Frank Maine (Wellington):: Mr. Speaker, marriage is a partnership. When a couple enters into this holy state, they face a life ahead of them in which many decisions must be made. In some of these decisions they have a choice, but in other decisions they have no choice. To illustrate in which decisions they have no choice, let me refer to the decision of who will decide what the sex of the offspring will be. Another example is who will carry the offspring during the gestation period. At least medical science has not changed that yet.


Stanley Howard Knowles: You should bring in a bill to change that.


Francis William (Frank) Maine: There are other decisions in which they do have a choice. To illustrate this, there is the decision as to

who will earn the income for the family unit. The husband may earn the income, the wife may earn the income, or they can both earn the family income. Another decision which they have the choice to make is who will do the housework. The husband can do it, the wife can do it, both can do it, or neither can do it but instead they can hire help to do it for them. In the latter case they have a real idea of the monetary value of the housework when they pay the wages of the help that does it.
So there is no question that housework has monetary value. The Canada Pension Plan is satisfactory unless that partnership breaks up; then the wife's contribution to the family unit to which her efforts have contributed are not recognized. I believe they should be recognized because there is a real value in these efforts that she has contributed to the family. This is why I support extension of Canada Pension Plan benefits to include housewives.


Some hon. Members:: Hear, hear!


Francis William (Frank) Maine: The question is, then: how can one achieve this? There are many options and many alternate ways of approaching this problem. One of the questions one has to consider is whether these contributions should be voluntary, or compulsory. Another question is whether one pension should be obtained, that is, split between husband and wife, or whether there should be two pensions, one for the husband and a separate one for the wife. There are several other questions but these are the two important ones that come to mind. So far as voluntary contributions to the CPP are concerned, the problem with this is that it tends to reward the rich, as they are the ones who can easily afford to make voluntary contributions, whereas the ones who will most likely need these benefits are the poor people who cannot afford extra premiums under the plan.
In actuarial terms, the Canada Pension Plan is not self-supporting, and this is a strong reason for there being just one pension spill Deiween husband and wife, uchuk two pensions would tend to double the amount of payments to be made and, therefore, worsen the financial imbalance and aggravate the problems we are facing in this inflationary period when we are trying to restrict government expenditures.
For this reason, it is important that we opt for the one pension plan split between two partners. It seems to me that when a family unit breaks up-which is a real tragedy-at that stage the court has to decide how the estate should be divided. Up to the present, it is my understanding that CPP benefits are not considered part of the estate, and therefore the wife cannot benefit and her efforts are not recognized. I think we should change this. It is my understanding that presently this matter is being considered by the government and that action will be forthcoming in the not too distant future. For this reason, I oppose Bill C-202 in its present form.


Mr. Gus MacFarlane (Hamilton Mountain):: Mr. Speaker, before I say anything on the bill I should like to assure members of the House that the hon. member for Wellington (Mr. Maine) is my seatmate, not my house spouse. I congratulate the hon. member for Waterloo-Cam-bridge (Mr. Saltsman) on his diligence in time and again
Canada Pension Plan
calling to the attention of the House, inequities which exist in the Canada Pension Plan. He is to be congratulated for bringing to the attention of the minister and the government the unfair situation which exists for the housewife. Also, I should like to congratulate the Minister of National Health and Welfare (Mr. Lalonde) for the great concern he has shown in the ongoing development of the CPP. However, I am persuaded that both hon. members who have spoken in this debate are involved with the technical details of the implementation, and neither has come forward and recognized the ideological and philo-sosphical truths.
In the past, the hon. member for Waterloo-Cambridge has said that if the housewife could make contributions to the plan or remain in the plan, the husband could pay for her if he were in a position to do so. Surely this is what a loving husband would do, without a plan. The hon. member is requesting that we seal forever in legislation the patronizing attitude which women have experienced through the years. He has also said, "If we cannot adapt the Canada Pension Plan to include housewives, then we must find a way of providing benefits and equity in the old age security benefit." Once again, is not each individual entitled to the old age security benefit? There should be no doubt that the house spouse, man or woman, should enjoy the equity of being entitled to Canada Pension Plan benefits. The minister has admitted that certain provisions within the plan accord different treatment to male and female contributors and beneficiaries. He has further recognized that views have been expressed that housewives who remain at home and do not draw salaries as members of the working force should be enabled to participate in the Canada Pension Plan.
The minister has suggested two approaches: first, crediting to the spouse remaining at home a portion of the
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tions made by the employer on the employed spouse's behalf; second, on an optional basis, permitting the spouse at home to contribute as a self-employed worker. Some hon. members who advocate the participation of housewives in the Canada Pension Plan appear to have two goals in mind: first, to give recognition to work in the home as regular employment; second, to guarantee some measure of independence to the housewife.
I must say I am convinced that hon. members then lose themselves in the technicalities of achieving these two goals. For my part, I would like to operate on the premise that all things are possible if we come to the proper conclusion concerning work and the independence of the housewife or housespouse. Let me address myself to these two matters and leave the legislation to far more competent individuals. Mr. Speaker, our recent rounds with inflation, unemployment, unemployment insurance and welfare, have brought much attention to the work ethic. Many statements have been made concerning the necessity for incentive programs and for the recognition of work, in itself, as a good thing. One such statement is as follows: To be idle is to become a stranger to the seasons.

October 29, 1974
Canada Pension Plan
To be idle is to step out of life's procession that marches in majesty and proud submission toward the infinite.
Life itself is pointless save when there is an urge.
The urge itself is blind save when there is knowledge.
Knowledge is vain save when there is work.
And all work is empty save when there is love.
And when you work with love you bind yourself to yourself and to one another and to God.
Mr. Speaker, you will notice that I have drawn freely on some of the great thoughts of Kahlil Gibran. It is most important to honour the work in the home, as all work in our day and age should truly draw honour. Work with love is to weave the cloth with threads drawn through the heart. It is building a house with affection. It is to sow seeds with tenderness and reap the harvest with joy. Surely hon. members will agree with me that housework is to charge all things you fashion with a breath of your own spirit. The work of the housewife is easily compared to the work of him who seizes the rainbow to lay it on a cloth in the likeness of man. Work is love made visible. This the housewife has done down through the centuries and we should be proud to recognize this along with the dignified work of the labourer, the executive, the soldier and the maestro.
Mr. Speaker, second I wish to address myself to the independence of the house spouse. I will, however, concentrate on the woman as the partner, because up to now she is the one who has been denied her independence. Marriage is that kind of experience which implies you were born together, and together you shall be forever more. But there should be spaces in togetherness. Again I quote:
And let the winds of the heavens dance between you.
Love one another, but make not a bond of love:
Let it rather be a moving sea between the shores of your souls.
Fill each other's cup but drink not from one cup.
Give one another of your bread but eat not from the same loaf.
Sing and dance together and be joyous, but let each one of you be alone.
Even as the strings of a lute are alone though they quiver with the same music.
Give your hearts, but not into each other's keeping.
For only the hand of life can contain your hearts.
And stand together yet not too near together:
For the pillars of the temple stand apart,
And the oak tree and the cypress grow not in each other's shadow.
I think back to the time when I was a young man and had the opportunity of observing a family which comprised 21 children and the father and mother. Certainly the father went to work, but I wonder what the mother with the 21 children did? Should her occupation not be classified as work? I think it is important to recognize that work in the house, that wealth for which mothers down through the ages have been responsible, is indeed dignified work, just as we have come to recognize that work with the shovel, with the pen, with equipment or even by automation is, indeed, an urge to move forward and to serve in life. So we must accept as a principle that work itself is dignified and that the housewife is, indeed, involved in work.
There is still some confusion, however. We are always unclear whether the woman is not still just part of the

family unit or whether she can have the option of going into a pension plan on her own without depending on the husband to pay her contributions. I believe that in most cases a loving husband takes care of his wife, so we are giving him the opportunity to do it in a legal fashion. It still leaves it up to the so-called senior partner, the head of the family, to decide if he will give the money.
Surely those persons who have some idea of technicalities can suggest a better settlement than this. Surely one of the main features of the Canada Pension Plan is its compulsory nature. Surely we should not settle in any way for the optional nature in respect of the woman. Surely we should not in any way try to secrete the money to her through the old age pension. Surely we should be proceeding with all haste to recognize the individual independence of woman, and that this woman is secure with this man and they are both entitled to the Canada Pension Plan, which may one day become a guaranteed income.
Mr. Speaker, let us not only in this House pass legislation concerning pensions. Let us make certain that we make an open statement concerning the dignified role of the housewife in our society. Let us make certain that, while recognizing the wonder and value of the family, we recognize the individual rights of its members, the participation and single desires of the husband, the individual rights of each child and the independence of woman to achieve her own destiny.
I am firmly convinced that in presenting legislation that touches on the status of women we must not continue to refer to women in a patronizing way, but as beings who deserve in every way equality with the breadwinner. To presume that men and women should always drink from the same cup, that they will always be united, is to presume that one or the other has lost his individuality. I believe in the perfect union where each should respect the other. Therefore we can refer to the term house-spouse. If, in future, the male decides to stay home and do housework, that term should apply to him. We must not lose sight of what we want to do.
In the past, the woman stayed home while the man went off and did what he had to do. The woman stayed home during wars; she stayed home and cared for 21 children while the man went to war, or the older brother went to war, or the older married son left his new wife and went off to fight. If we consider the task of woman to be work, let us dignify it. Let us pay her the respect we pay those who sent men to the moon; let us respect her in the way we respected those who, in generations of fear and oppression, defended nations. Let us respect her as we respect those who create paintings and music. Let us recognize that woman has prepared the supper with loving care, and performed with love those tasks which are necessary in the home, while others were away doing what they considered more important.
The minister, and the hon. member who presented this bill, have both shown great concern over improvements to be made to the Canada Pension Plan. I respectfully suggest that before we pass a measure of this kind, which is well deserved, we must respect work in the home as work
October 29, 1974

itself; we must respect the dignity and independence of woman.


Miss Coline Campbell (Parliamentary Secretary to the Minister of National Health and Welfare):: Mr. Speaker, my comments will deal with the comments of the two hon. members who have spoken, and with the voluntary aspect of the legislation in question. It has been suggested that for purposes of contributions the work of the housewife should not be considered as voluntary work but as regular employment.
For too long we have looked at the woman as the person who stays home and does housework and, at the end of the day, greets her husband and performs her wifely duties. It is time we considered providing some measure of financial security for the woman. I am thinking of women who may be deserted by their husbands, who may be separated from their husbands, or who may be divorced and are unable to obtain support from their ex-spouses.
The idea of bringing housewives under the umbrella of the pension plan was mentioned in Edmonton at the health ministers' conference last February. Since then this idea has become one of top priority. The matter is also under study by a subcommittee of the Canada Pension Plan Advisory Committee. Consultations between such bodies and those to do with the status of women have received a great deal of press coverage. We anticipate that reports will be forthcoming in the near future.
May I now talk about the hon. member's bill. As the hon. member knows, before a proposal like this can become law it must obtain the consent of two-thirds of the provinces containing two-thirds of the population. Therefore, the need for full consultation with the provinces before such a proposal can become law is clear. In addition, this subject is currently part of the total social security review being carried out by federal and provincial welfare ministers.
Another important consideration is die uou ability cf maintaining as much similarity as possible between the Canada Pension Plan and the Quebec Pension Plan. For that reason I suggest that the implications of the present proposal should be discussed fully with representatives of Quebec who are also participating in the social review program.
Let me draw attention to another part of the hon. member's proposal. If a housewife's computed earnings are to be determined at her option, it surely follows that other contributors and non-contributors will demand the same right. Clearly, this implication of the hon. member's proposal would jeopardize the earnings related principle of the plan. For instance, if a housewife were allowed the right to determine earnings, there would be considerable pressure to allow the sole breadwinner the choice of increasing coverage from actual earnings to maximum earnings.
Another proposal concerns housewives being covered on a voluntary basis at the self-employed contribution rate. Presumably, coverage would be optional rather than compulsory, so as to avoid placing a burden on low income families. However, voluntary coverage, as proposed, would permit our more affluent families to contribute under the most advantageous circumstances. In other words, the
Canada Pension Plan
poor would not benefit and the rich, as they say, would get richer.
I think the bill defines to a certain extent the person who can be considered as a housewife, but does not say if coverage is to be extended to those involved in common law relationships, to house husbands, widows, and so on. Neither does it touch on the coverage of other deserving persons not attached to the labour force, such as students, non-working single women and the long-term unemployed.
The bill speaks of being occupied entirely as a housewife. Is it the intention to exclude any housewife who may earn a few dollars at some part-time activity? Some definition of parameters appears to be required in this bill. In other words you might have a housewife, who goes out and earns a nominal amount, being excluded from contributing as a housewife.
The whole bill seems to discriminate against an area of people who would like to be in the enviable position of being able to contribute to the maximum earnings without any set guidelines. The government, particularly the Department of National Health and Welfare, has been studying this whole area of trying to help the housewife.
The housewife has always been in a position in which she could not defend herself. She has not had access to legal facilities in the past. She has been doomed to the idea of going after welfare agencies for support, or of going after the stray husband. This has incurred an awful lot of difficulty, particularly where the woman could not receive any benefit until a certain period of time had elapsed.
The government has now come around in its thinking and some of the policies put forward in the working document which was presented by the Minister of National Health and Welfare (Mr. Lalonde) to the standing committee on April 4, 1974, produced mandatory alternatives. These aUcinatives included the eor.+r^ntinn on earnings. This would allow a housewife to contribute in her own right and build up her own pension entitlement. However, it would be necessary to set a wage on what housewife duties are worth in terms of the family unit from which she comes. This approach would certainly give recognition to work in the home as regular employment. However, some standard would have to be obtained to make it non-voluntary in terms of any amount being contributed versus a set standard if this plan were to be used.
The other alternative is the splitting of pension credits, an approach set out by the Royal Commission on the Status of Women. As the royal commission put it, this would involve crediting to the spouse remaining in the home a portion of the contributions of the employed spouse and of those contributions made by the employer on behalf of the employed spouse. This seems to be a fair way in terms of splitting the income of the earning spouse across the board in the event of a separation. In other words an agency could immediately go against the spouse and determine the amount the wife might have contributed at a designated point in time.
To explain it more clearly, the spouse would probably be entitled to a percentage of the earning spouses contribu-

October 29, 1974
Canada Pension Plan
tions at the time of the split. This means that if the husband decides to go, some agency will be able to go against his contributions and convert that to the benefit of the housewife.
The hon. member for Waterloo-Cambridge (Mr. Salts-man) is to be complimented on bringing forward this bill. However, the voluntary aspect is a handicap. It allows putting something into a pension plan on the part of a housewife that discriminates against her sex and others in the working world who would like to contribute on maximum earnings rather than the graded step.
To summarize, the government's position has already been stated. The government is studying the whole idea of pensions in relation to housewives. This became a priority at a meeting in Edmonton of the ministers of all provinces and the federal minister. It is being studied closely by the respective provinces as well as the federal government. Hopefully at some point in the future some type of legislation will be brought forward as a result of these studies.
As a result of that conference this whole issue was referred to the Status of Women Advisory Council as well as the Canada Pension Plan Advisory Council. They are studying the most advisable way of implementing a pension. Reports are anticipated, and implementation of the plan should be forthcoming.
I again thank the hon. member for his bill. However, I must oppose it on behalf of the government on the basis of the voluntariness of the plan. In one sense it is a very limited version of voluntariness. Also, the definition of housewife does not make it clear who would be included in this scheme. Someone could be excluded by working on a part-time basis. Even though she may not contribute to the Canada Pension Plan, she could be excluded under this bill. The voluntariness of the plan seems to discriminate against a lower income person whose husband cannot afford to give the benefit to the housewife to put into the plan. On the other side of the coin, there are those whose husbands earn sufficient to contribute to the maximum amount.
I am not trying to say that I am against the implementation of a pension for housewives. It is the position of the government that the work women do in the home will be recognized as regular employment and that they should be provided with protection against need. However, as I have said, the government is against this bill particularly on two points, the definition of "housewife" and of "volunteering" as put forward by the hon. member.


Stanley Howard Knowles: The fact that this debate is taking place today underlines how fast history moves. If any government were trying to bring in a bill today which left out of account, as the Canada Pension Plan does, the position of women in general, and particularly the position of housewives, it would have a rough ride. Yet only nine and one half years ago we debated and passed in this chamber the Canada Pension Plan with these deficiencies. A lot has changed in the last nine and a half years, and I pay tribute to those who have pressed the case of the rights of women to an equal place in our society.

I am glad this bill has been introduced. It is easy for the Parliamentary Secretary to the Minister of National Health and Welfare (Miss Campbell) to call attention to the difficulties, but the issue will not go away and I do not think it would hurt the government to consent to the bill, or at least its subject matter, going to the Standing Committee on Health, Welfare and Social Affairs so that we could consider this whole question. It does seem to me that, in many respects, the position of women in relation to pensions has to be reviewed and updated.
As I say every time I get to my feet, I think it is for the birds that pension plans generally provide 100 per cent benefits to a man and provide for them to be continued at 100 per cent if he loses his wife and carries on, but provide only 50 per cent to the widow if the husband dies first. Likewise under the Canada Pension Plan there is a built in discrimination against the spouse, whether male or female. There is certainly a built in discrimination against housewives and I think this ought to be corrected.
This is private members' hour and one of the ten commandments for opposition members is never to be guilty of talking a bill out during private members' hour. So I will have to sit down soon. However, I do wish to express my congratulations to my hon. friend from Waterloo-Cambridge who has brought this issue forward today. I am not surprised that it is likely to be talked out, but I welcome the support from the hon. member for Hamilton Mountain (Mr. MacFarlane), and from the parliamentary secretary for the idea that we should be coping with this problem. I just hope we cope with it soon.


Mr. Ross Milne (Peel-Dufferin-Simcoe):: Mr. Speaker, it is a pleasure during the remaining few minutes of this debate to make a brief comment on the proposal put forward by the hon. member for Waterloo-Cambridge (Mr. Saltsman). I listened to his presentation and wish to be on record as being in agreement with most of what he had to say. It seemed to me, though, that the viewpoint he was putting forward was not broad enough-that amendments to the act should take into account other matters which are of equal importance.
I should like to express a special interest with regart to the position of women who are part of the management team on farms. These women have made a great contribution to the agriculture industry. For a while the trend in agriculture was toward large, integrated farms. Some may be surprised to learn that more of these farms went bankrupt on a percentage basis than any other type. It seems to be that the future of agriculture must be based on family management units, and when one thinks about family management units it is evident that a great deal of the input comes from farm wives.
I am talking now about viable farm units, units which are eminently successful, and to the operation of which the farm wife makes a major contribution as purchasing agent, registrar of pedigrees, and so on. If these groups are dissolved for any reason, the woman is at a great disadvantage; unless legal arrangements have been carefully made in advance she is likely to be left with little security and no recognition of the major contribution she has made. The same might be said of wives who help in the operation of small businesses.

We are not opposed to the position taken by the sponsor of this bill but, in our view, his proposals do not extend far enough, I should like to be recorded as saying that any person should have the right to contribute to a voluntary pension plan, whether a housewife, an injured workman, or a person who has had to withdraw from the work force for any reason. Finally, I wish to congratulate the hon. member for bringing his private member's bill before the House so that we might have an opportunity to discuss it.


Joseph-Phillippe Guay: Mr. Speaker, I, too, would like to say a few words on Bill C-202. I agree with it wholeheartedly. I also agree with my hon. friend who has just spoken that it does not go far enough. All women should be included. There are some women who cannot afford premiums such as those on welfare, etc.-


Mr. Deputy Speaker:: Order, please. I regret having to interrupt the hon. member, but the hour appointed for the consideration of private members' business has expired.
It being six o'clock, I do now leave the chair until eight o'clock tonight.
At six o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.


[Stage Direction]
The House resumed consideration of the motion of Mr. Turner (Ottawa-Carleton) that Bill S-7, to authorize federal trust companies and loan companies to increase the monetary limit of their borrowing power and to issue subordinate notes, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
John R. Rodriguez: Madam Speaker, before five o'clock this afternoon I was saying that if Gilbert and Sullivan were to write an operetta on this Senate bill it would probably be entitled "The Pirates of Finance". The first thing that struck me about it was that it seemed very a propos that this bill should originate in the other place. The Tory member for Annapolis Valley (Mr. Nowlan) referred to the bill as a very technical bill. That may be because it was conceived and drafted by Senators who certainly know what is best for Canada's 31 federally incorporated trust and loan companies, whose total assets of $7 billion bespeak their poverty.
When this bill is shorn of its technicalities we find that it is a gross attempt to increase the profitability of these 31
Trust Companies Act
trust and loan companies. It must galling to these poverty stricken financial institutions to see today's juicy interest rates, which could certainly swell most of their funds, and to know that they are committed to lower interest rates of 9 to 10 per cent.
Let me quote a few of the comments made by Mr. D. G. Neelands, president of the Trust Companies Association of Canada and of Canada Permanent Trust. Before I do so, it has always struck me that the names these companies choose to identify themselves are rather strange. For example, they use words like "Trust", "Acceptance", "Beneficial", "Household", "Associates", "Permanent" and "Guaranty", all words that bespeak the solidity of the community. This is what Mr. Neelands had to say before the Senate Banking, Trade and Commerce Committee:
The trust industry ... is experiencing some difficulties at the present time in terms of earnings.
One of the venerable Senators, Senator Hayden, put it more bluntly when he said:
I suppose, then, in another sense, you might put it this way, that the ability to expand would provide you with sources of money, so that you can get the benefit of the high interest rates that are currently in effect to offset some of the low ones that you are stuck with.
And of course, Mr. Neelands replied:
That is true ...
Having made clear how he viewed the bill, Mr. Neelands goes on to suggest that if this bill wins Canadian acceptance there might be some permanent, beneficial guarantee that citizens would be able to purchase their households from the trust companies and their associates. This, of course, is to ignore the major problem in housing in Canada, which is the cost of mortgage money.
The fact of the matter is that the great majority of middle and low income Canadians cannot afford the usurious mortgage interest rates of these big-hearted companies. My party's policy is that housing is a social right for every Cenedier "rhrt	tn nwn * home Our neonle
should not have to depend on these companies to provide mortgage funds, because it has been proven time and again that they do not recognize the social priorities of the Canadian community.
I note that the latest quarterly and half yearly figures of most trust companies show profit levels that are tending downwards. What a pity! It is an observation that ought not to be lost on the Canadian consumer that this government is very quick to step in when profits tend downwards. But when profits tend upwards, as in the case of the food processors and retailers, the government takes the hands off position that the marketplace ought to determine its own rate of rip-off. Heavens, cannot we have some consistency from the government? Indeed, the only thing consistent about the government is its inconsistency-


Lorne Edmund Nystrom: That is free enterprise, John.


John R. Rodriguez: I suppose they call it free enterprise but there is nothing free and nothing enterprising about it, at least not for the working class people of the country. It is only free and enterprising for the Neelandses and, I suppose, the Senator Haydens of this world who always seem to find a place in the other place.

October 29, 1974
Trust Companies Act
I do not want to prolong this debate, so I suggest that the best thing to do with this bill is to defeat it right here in this House.


The Acting Speaker (Mrs. Morin):: The hon. member for Moncton.


Mr. Leonard C. Jones (Moncton):: Madam Speaker-


John R. Rodriguez: En frangais!


An hon. Member:: In French.


Leonard C. Jones: I do not speak French, what about you? I do not speak French.

Madam Speaker, there appears to be something odd and perhaps sinister about the manner and conduct of the debate on this bill. Quite frankly, it has been difficult for even the most astute technical financier to study and scrutinize any portion of the enormous verbosity and complexity of this bill. Its ramifications are tremendous and I sincerely fear that haste, in both perusal of the bill and a full and proper presentation of it, will sooner or later be regretted by those who have introduced it into this House.
There is a maxim in journalism and law which says: "When in doubt, leave it out". Possibly those who drafted this blooming legislation realized that it was not really blooming, and that they were following this maxim of when in doubt, leave it out. Perhaps we should do the same thing and throw the bill out this evening, because so much, Madam Speaker, is left hanging in mid-air. We are given no clues, and possibly those who drafted the bill had very few clues too.
So much of what should have been in the bill has been left out that the bill is made ineffective and meaningless. It is a terrible commentary on drafting. This legislation is a poor commentary on our parliamentary system. Those who presented Bill S-7, entitled "an act to authorize federal trust companies and loan companies to increase the monetary limit of their borrowing power and to issue subordinated notes," must have thought differently. They must have thought that the members of this House were very naive, to say the least.
First of all the title is misleading; it is deceiving; it is a misnomer. The explanatory notes and information given us by those presenting the bill are negligible. They are nil. It seems rather ridiculous for us to discuss any such legislation without having complete disclosure. In business circles one hears the expression "let us have disclosure". There is no disclosure in respect of this legislation.
The next item which concerns me, which must concern all other members, and which will disturb certainly decent thinking members of this House and the public when they hear of legislation of this kind, is the ministerial discretion that is given to some member of the cabinet. I thought that went out with Magna Carta when King John was taken to Runnymede. Certainly this bill will result in arbitrary, bureaucratic dictatorship for the minister, the trust companies and the loan companies.

This bill is a perfect example of the uselessness of the Senate and the duplication of cost to our country. It will lead to inflation. It is unreal. It will lead us into a worse economic situation than we have today. It is inflationary. Interest rates certainly are high enough, but if a bill of this kind should be enacted they will go even higher. I said earlier that the bill is a misnomer. Obviously this bill has been thrown together without any realization of its results and effects. My prediction is that it will create inflationary trends never seen before in Canada.
If this House should pass this bill, or even refer it to committee, that would be an absolute waste of time. There are other more important things which might be considered. There are many items in this bill that will lead citizens and shareholders alike to be misled in respect of subordinated notes. This is nothing more than a cheap way for loan and trust companies to obtain money from the citizens of this country without exercising a real responsibility toward them. There is no real protection provided for holders of these notes.
Again I urge that this bill not be sent to the committee but be voted out right now. It is a monstrosity.


David Réal Caouette: Madam Speaker, as the hon. members for Nickel Belt and Moncton (Messrs. Rodriguez and Jones) have just explained, Bill S-7 is rather confusing. First of all, it was brought before this House after being passed by the Senate without our having had a chance to read it. We are being asked to pass a bill, and I quote:
-to authorize federal trust companies and loan companies to increase the monetary limit of their borrowing power-
-in order that they might loan and reloan at exorbitant interest rates, as we have quite often noticed in the field of finance.
To my mind, confusion reigns supreme in this country where financial and monetary matters are concerned: one day, plans are made to set up a federal development bank; the next, for another financial organization to confuse or annoy the people. Bill S-7 is yet another one, the purpose of which is to allow the trust and loan companies to borrow, and specially to increase their borrowing power.
To my mind, we are going around in circles; we are not improving the situation; on the contrary, there is more misunderstanding than ever about our present financial system.
Madam Speaker, we, of the Social Credit Party of Canada, have advocated for a long time a financial formula which some would call simplistic. I would rather have that than confusion such as is proposed by Bill S-7. I can understand that some hon. members oppose it, for instance, the hon. member for Moncton. He was not too clear about it when he said: We must oppose this bill. Why? No one knows. Still, the hon. members of the NDP applauded despite the fact that they did not know what it was all about.
However, the House studies the secondary aspects of the real problem, the secondary aspects of what must be changed in our economic system. And it is not by increasing the borrowing power of a loan company that we shall improve the situation. There are easier ways to do so.
October 29, 1974

As concerns Bill S-7, it is obvious that we oppose it and that we shall ask that it be put to a vote. The government has the majority, and this is the trouble with a majority government in Canada, Parliament is forced to accept its ideas while members of parliament should have all opportunities required to defeat the government on important matters, on monetary and economic matters, because all this is related to the Canadian economic system.
Madam Speaker, the Social Crediters have other solutions to suggest. Instead of increasing the borrowing power of federal trust and loan companies, we should use the services of the Bank of Canada, which belongs to Canada and to Canadian citizens, and harness the physical possibilities of our country. It is up to the government to pass regulations and to order the Bank of Canada to act in the interests of the Canadian people, and not in order to increase the borrowing power of federal trust companies or loan companies.
Instead of laughing at the duties and obligations of the Bank of Canada, all hon. members should force it to maintain an efficient instead of a restrictive economy, a logical instead of a shaky economy like the one we have presently. If we examined seriously the problem instead of creating new financial institutions and trust companies with increased powers, if we increased the powers of the Bank of Canada in order to serve the Canadian people, it seems to me it would be the end of the economic, political and social games we are witnessing at this time.
As everybody knows, there is a feeling of discomfort in all areas of economic activity. Let us correct the cause of this discomfort. I am sure it is possible to guarantee the Canadian people, without the help of any other country, economic security and personal freedom, and to ensure that Canadian production will first serve Canadians contributing to it.


The Acting Speaker (Mrs. Morin):: I must remind hon. members that when the parliamentary secretary speaks he will close the debate.


Some hon. Members:: Question.


Jack Sydney George (Bud) Cullen: Madam Speaker, I too am anxious to get to the question. However, the hon. member for Edmonton West (Mr. Lambert) and others have raised some issues which I think need comment.
Frankly, I wondered if the hon. member for Moncton (Mr. Jones) had read the bill. He seemed to indicate that subordinate notes will be issued and companies will be going out and taking money from every Tom, Dick and Harry. I should like to draw his attention to a clause of the bill which provides that subordinate notes shall be issued only on the application of the head office of companies, and shall have denominations of $25,000 or more. So it is not similar to promissory notes, it is a fairly significant sum, and I suggest, with respect, that any company that is in a position to lend that kind of money is pretty sophisticated.
Trust Companies Act
The hon. member for Annapolis Valley (Mr. Nowlan) said that this was a complicated bill. I am not surprised he thought that because he did not deal with the bill but rather with many other issues.


Some hon. Members:: Oh, oh!


Jack Sydney George (Bud) Cullen: The purpose of this bill is to increase the monetary limit of the borrowing power. Some hon. members indicated that they did not have enough information on this. I suggest that this is almost housekeeping legislation insofar as increasing the borrowing power is concerned, and that four safeguards are proposed which will be discussed at the committee stage.
I suggest to some individuals who do not feel they have all the information they want, that we spend hundreds of thousands of dollars each year so the opposition parties can have the necessary research facilities and research assistance. Obviously the New Democratic Party made use of this, and that is the way to use the research money.


Some hon. Members:: Hear, hear!


Jack Sydney George (Bud) Cullen: Now, why is this bill being presented at this time? Frankly, it is because of the strength of the economy-


Some hon. Members:: Oh, oh!


Jack Sydney George (Bud) Cullen: -that most of these companies have reached the level of borrowing-


Some hon. Members:: Oh, oh!


Jack Sydney George (Bud) Cullen: I thought hon. members wanted some of the responses that I am endeavouring to give. I listened patiently without heckling.


Some hon. Members:: Trust Companies Act
the same party decried the supervision and the discretionary powers given to the minister.
I listened with interest to the hon. member for Yorkton-Melville (Mr. Nystrom) speaking about the little people he represents. I suggest to him that the little people in his riding and in mine are using these particular facilities in order to finance their houses.


Some hon. Members:: Hear, hear!


An hon. Member:: Yes, at 13 per cent.


Jack Sydney George (Bud) Cullen: There was one other comment by the hon. member for York-Simcoe (Mr. Stevens) who said this was a band aid approach. No one suggests that this is the be all and end all. This bill endeavours to do things which are very clear, and which are innocuous insofar as the over-all picture is concerned. However, they are very necessary if this segment of the economy is to operate.
I agree with the hon. member for Edmonton West and I think that the point he made is an excellent one. I frankly apologize for the fact that we did not have all of the material from the Senate committee because, notwithstanding what some members of the NDP think, there is a wealth of information and assistance available there.


An hon. Member:: It is a waste of money.


Jack Sydney George (Bud) Cullen: However, with other bills from the Senate we will have that information.
Insofar as conflict with the Finance Committee is concerned, I might say that this comment would have been warranted if the House had not spent so much time on Bill C-2 last night and got that bill into committee. It was our hope that this Bill S-7 could have been dealt with last night, would have received second reading and been referred to the committee. I am sorry about that, but it was not of the government's making.


Some hon. Members:: Hear, hear!


The Acting Speaker (Mrs. Morin):: Is the House ready for the question? All those in favour of the motion will please say yea.


Some hon. Members:: Yea.


The Acting Speaker (Mrs. Morin):: All those opposed will please say nay.


Some hon. Members:: Nay.


The Acting Speaker (Mrs. Morin):: In my opinion the yeas have it.
And more than five members having risen:


The Acting Speaker (Mrs. Morin):: Call in the members.


Mr. Speaker:: I declare the motion carried. Accordingly, the bill stands referred to the Standing Committee on Finance, Trade and Economic Affairs.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Mr. Speaker:: I understand there have been some consultations and that the Minister of Indian Affairs and Northern Development has the consent of the House to revert to motions.


Some hon. Members:: Agreed.



ROUTINE PROCEEDINGS


J. Judd Buchanan: Thank you, Mr. Speaker. I believe there is agreement to make this reference to committee without debate. I therefore move:
That the Standing Committee on Indian Affairs and Northern Development be authorized to hear representations from the Northern Quebec Innuit Association.


Mr.   Sneaker@: The House has heard the terms of the motion. I understand there has been discussion along the lines indicated by the minister.


[Stage Direction]
Motion agreed to.


Otto Emil Lang: moved that Bill C-19, to provide for payments in respect of wheat produced and sold in Canada for human consumption in Canada, be read the second time and referred to the Standing Committee on Agriculture.
He said: Mr. Speaker, this fairly straightforward bill is yet a somewhat significant one. I take pleasure in introducing it and recommending that it be sent to the Standing Committee on Agriculture where it can be examined further before proceeding into law.
Wheat Payments
This is a bill whose specific purpose is to enshrine for a period of years, in this case for seven years, a procedure whereby the treasury supplements payments made for wheat designed for human consumption in Canada. The government acted in order to place a portion of the cost of milling wheat essentially on the shoulders of the treasury, thereby minimizing the impact of increases in the price of wheat which were occurring, and ensuring that the price of bread, a product essential to the diets of families, particularly those with lower incomes, would be lower than would otherwise be the case.
The bill allows for the transfer from the treasury of up to $1.75 per bushel, with respect to wheat consumed in Canada, to the producers of the wheat-to the Wheat Board in the designated region, to boards designated in other regions to act on behalf of producers, or to producers themselves in other areas. The amount transferred is the amount they would otherwise normally have obtained from the millers.
Initially, the bill in the form in which it was introduced in the previous session would have performed this function for the full period of the arrangement which was entered into in September of 1973, in order to assure the transfer of the appropriate amount of money to the producers for the first part of the period. Before the passage of the bill an item in the estimates dealt with the first series of such payments, but the intention of the bill is to provide these payments for a long period of time.
I think it is significant that this payment in support of the price of bread is to be put into law for a prolonged period of time. It is in its present form without any doubt and, I should think without any argument, in the nature of a consumer subsidy, an amount paid by the treasury, on behalf of the people of Canada as taxpayers, to lighten the burden on the consumer of the cost of wheat products in Canada. It is in this way a significant milestone in tecn-nique, one which should be applauded by members on all sides of the House.
The bill also has a relationship to other factors in connection with wheat prices. The very title of the bill, two-price wheat, has had a fairly long history of debate in the producing areas of Canada, particularly in the prairie region where so much of our wheat is grown. There, when two-price wheat began to be talked about, it was in terms of the obligation and necessity of Canadian consumers paying a fair price for their wheat in Canada in order that producers receive a somewhat better return, even when the world price for wheat was lower than a figure that was reasonable in those days. The introduction of such a plan of higher prices for wheat was brought about in Canada initially, therefore, as a transfer from consumer to producers above that which the international market would bring them.
The first action in this regard was taken by this government in 1969, when the interruption in the arrangement made under the International Wheat Agreement meant that the world price began to fall below the floor that had been agreed upon. When that happened the government acted to hold the price in Canada at the figure of $1.9514, as it then was, which was the equivalent of the floor in the
28305-55'/:

October 29, 1974
Wheat Payments
international agreement. This price persisted, and was held throughout a period of very difficult years when the world price fluctuated but generally fell to levels in the order of $1.70 a bushel. Throughout that period two-price wheat was a benefit transferred from the consumer to the producer, but one which was fully legitimate, in my view and in the view of the government, due to the costs of production. Indeed, if it had been within our power we would have had such a price throughout the world market area rather than just in Canada alone.
Then in response to the suggestion that this was still inadequate, that further protection should be given the producer in connection with wheat consumed in Canada, and that further compensation could and should be given him, in 1972 we introduced a two-price wheat payment to farmers in addition to the $1.95'A that was being obtained by him from the market, a figure that was above the international price.
At that time, with the price still hovering in the area of $1.70 and with the price to millers at $1,951/2, we determined, in response to further requests from producer organizations, that a two-price wheat program should be brought in which, in effect, valued wheat consumed in Canada at $3 a bushel. Even at that time we showed our concern about the problem of imposing that additional cost on the actual consumers of bread, recognizing that so many of them were in the least suited position to pay, and that some of them would indeed require a helping hand rather than be given a further burden.
Accordingly in introducing the two-price wheat program we introduced it in the form of a payment from the treasury, rather than an increased charge from the millers. At that point we were in a situation where we effectively had a fixed price for wheat in Canada regardless of the world price. The $1.9514 would come from the millers and another $1.0414 would bring the amount up to $3; but we were effectively valuing wheat in Canada used for human consumption at a fixed price of $3 regardless of where the international price might be then.
With the changes in pricing patterns which occurred in 1973 and 1974, as international prices rose to the $3 level and then, indeed, passed that level, it became apparent that a review of the $3 price of wheat used for domestic consumption was appropriate. I suppose one could have taken the position that that having been the price which was set while the world price was as low as $1.70, it should have been maintained in a period after that while the world price rose above that price. However, we recognized that the producers had been in a difficult position, and that they were still in a difficult position in terms of their costs and their returns, and we accordingly felt that a different pricing structure was appropriate.
At that time, with prices approaching what were then record levels, levels which are still to this day pretty well close to a record, we decided that we should look at the proposition that as between the Canadian Wheat Board on the one hand, and other producers of wheat in Canada, and the consumers of Canada as represented by the buyers, millers and other users, we should enter into an arrangement whereby there would be a range of prices for grain, for wheat used for human consumption, a range

which reflected more adequately than anything before that the cost of production to producers.
Thus we decided that for seven years we would have a price of wheat in Canada for millers which would not be allowed to fall below $3.25, twenty-five cents higher than the previous fixed price, and correspondingly would not be permitted to rise above the level of $5. We recognized that with that arrangement there would possibly be transfers from producers to consumers compared with the world market when the price of wheat was above that $5 figure. On the other hand there would be potential transfers from the consumer to the producer in a period when the price of wheat was below $3.25.
It seemed to us that it was an appropriate time to enter into such an arrangement. From the producers' point of view it was a time when it was reasonable to look at long-term pricing in a way that would have been far less advantageous earlier. When prices are low it is very hard to persuade buyers to enter into agreements which include price ranges that are very high. At the time we entered into this arrangement we had prices that had just hit a record level, a level which, as I have pointed out, is today still a record. For only very brief periods has the price of wheat crossed the level which we had at the time this arrangement was entered into, Mr. Speaker.
What we were doing was saying that this kind of arrangement is one that we would like to enter into with some of our regular customers, a long-term arrangement whereby a reasonable range of prices for grain was fixed, a range that recognized cost of production of this grain on the part of the producer. Having set the range at $3.25 to $5 for a seven year period, we continued the philosophy that had gone into the original payment from the treasury for two-price wheat, namely, that the portion above $3.25 should be borne by the treasury rather than be reflected in an increase in the price of bread.
At that time as we made our move we were able, in effect, to stop the price of bread moving on the basis of increases in the price of wheat. The price of wheat was just moving through the floor level in terms of the millers' business when we entered into this arrangement. We therefore decided to put forward the proposition that while wheat, in terms of bread wheat other than Durum, was above $3.25, the portion higher than that 'up to $5 should be paid for from the treasury.
In the case of Durum, while the arrangement was just a little different, the basic principle was the same with a payment up to $1.75 from the treasury, although there the actual price in play went higher and this was also reflected in the amount allowed to be obtained from the millers. In our view the price for Durum was unnaturally separated from the price for other wheats, and there is a common long-term floor of $3.25 which was adopted for both.
This then is a measure which will see the transfer to producers from the treasury, for the period of the full seven years originally intended of amounts of money which will save the consumer significant amounts in the cost of his bread.
Figures can perhaps be a little misleading in talking about the price of bread because this depends upon mark-
October 29, 1974

ups and the arrangements that different people in the producing and marketing chain have, but I think one can safely say that this particular measure, with world prices at or above the $5 level, is saving in the cost of flour for bread in the order of five cents or six cents a standard loaf. To that extent it continues to be perhaps a small but significant element in our effort to cushion the problem of the cost rise for those who have to bear the load.
I, therefore, commend this measure to hon. members and invite them to pass it to the committee where we can look at it more specifically. Then we can see the bill become a part of the law of the land. As I said at the beginning, I believe it is a simple and straightforward measure.
I think this is a significant measure in the way of enshrining into our law a consumer subsidy for a significant period of time. I commend the measure to all hon. members and urge its passage on second reading for later study in the Standing Committee on Agriculture.


Donald Frank Mazankowski: Mr. Speaker, at the outset may I say that we on this side of the House agree with the principle of a two-price system. We regret, however, the fact that this bill lacks an effective measure to take into consideration the increased costs of production. Therefore we would recommend to the minister the implementation of such a provision to reflect the rising costs of production over the seven-year period.
The absence of such a mechanism is tantamount to a seven-year freeze for the Canadian wheat farmer in the range between $3.25 and $5 a bushel, depending upon world markets, in the case of wheat, and $5.75 to $7.50 in the case of Durum. So, it seems to me that at this point in time, during this period of very rampant increases in the costs of production, and during a period of very rampant inflation, more effective measures should be instituted in the pricing structure to take into consideration the increases in Droduction costs. I do not believe that the range referred to by the minister truly reflects or takes into consideration such increases in the costs of production because that range would be utilized depending only upon the price in world markets.
The minister has suggested that this measure constitutes a subsidy to the consumer at the expense of the public treasury. The minister may have referred to this and I may have missed it, but I would suggest that it also constitutes a subsidy at the expense of the producer, because we know that at this time the export price for milling wheat hovers in the $6 range while producers are receiving $5 per bushel for wheat earmarked for domestic human consumption.
It seems to me we really are asking too much of the wheat producer in respect of this bill. We are asking him to accept the vagaries of the international market place. This is something which, in the absence of any long-term international wheat agreement, the producers must bear the brunt of Mr. Speaker. Now we are asking the wheat producers to absorb the inflationary effects of a government which has no anti-inflation policy to speak of and I do not believe it is right to ask producers to accept the increase in farm input costs over which this government has exercised absolutely no control, and in respect of which it has shown no leadership.
Wheat Payments
The increase in input costs, has been averaging about 20 per cent on an annual basis. The producers have had to bear the brunt of this while the government played the role of Santa Claus with the unions. It is certainly a lot to expect the wheat producers to accept this as well as the uncertainty which surrounds the transportation system and the threat of the loss of the Crowsnest Pass freight rates. They are also being asked to absorb the huge demurrage costs which have accumulated. It seems to me that to ask them to do all these things is really asking too much from the wheat producers of Canada.
If we are dealing with a legislative measure which is supposed to give some protection and some stability to the wheat producers of the country, certainly now is the opportune time to build into the legislative mechanism some protective features which would offset the spiralling costs which face the western wheat producers.
We know, for example, that the two-price system which has been in effect for some time now has already cost the producers something in the order of $15 million. That represents the difference in the amount the producers could have received had the wheat been sold on the export market rather than being used for domestic consumption. As I said before, in the international market the export price for milling wheat is in the $6 per bushel range, while wheat which will be earmarked for domestic human consumption will be frozen at a maximum of $5 a bushel.
Canadians consume for human consumption something in the order of 60 million bushels of wheat per year. The difference of $1 per bushel between the export price and the domestic human consumption price will mean that, over the period of the next 12 months, the producers in western Canada in effect will be losing something in the order of $60 million. So, having regard to the fact that wheat producers are indeed giving up very much under this bill, it seems to me it would not be asking too much that the minister and the government build in an effective indexing system which would retlect the increases in ihe costs of production on a year basis.
I am not sure whether the minister feels that prices on the international market will maintain their high level or will go down. Nevertheless, it seems to me that if we do not bring forward some measure in this area, the producers in this country, having regard to the fact that prices on the international market may go down, could find that a bushel of wheat will be back to $3.25. It seems to me also-and I want to remind the minister again-that it is because of the absence of an effective cost of production control that we opposed quite vigorously the stabilization bill. I am sure that if the minister again introduces a grain stabilization bill in the House it would be in his best interest to propose some sort of mechanism to deal with the increases in the costs of production.
The United States, in its stabilization agricultural programs, has incorporated an indexing provision related to the costs of production, to ensure the wellbeing of farmers. This is also another reason why we should be going in that direction. Indexing has become a fact of life in Canada with this government, just as inflation is a fact of life. However, the government continues to say that it cannot

October 29, 1974
Wheat Payments
do much about inflation because it is an international phenomenon. But really what we are doing here is, in effect, fighting inflation on the backs of the farmers by not providing an effective mechanism which would cushion the effects of inflation upon them.
I must say again, as I said at the outset of my remarks, that the price of wheat for domestic human consumption is in effect being frozen. It is rather interesting that we have two vital commodities in western Canada being frozen, namely, wheat and oil-both products of the west-and yet the minister, whose interest in western Canada is known, and in spite of the fact that the government is not prone to accept the concept of price freezes, allows the price of both these important commodities produced by western Canada to be frozen for the benefit of the consumers in the whole of Canada.
It is also very disturbing to me to note that the minister suggests that he will examine the Crowsnest freight rates which for years have been the Magna Carta to western grain producers. In this respect we get conflicting comments from the Minister of Transport (Mr. Marchand) and the minister responsible for the Wheat Board (Mr. Lang). I hope that the minister will outline the form that the review of these rates will take, and that he will outline the policy upon which the government has embarked with regard to grain handling and transportation.
I also hope that very soon the promise of an equalized freight rate structure-a promise which was made to western agricultural ministers a year or so ago-according to which we would get better freight rates on the movement of beef from western to central Canada, will be kept. We certainly hope that the government will act more quickly than it has in the last twelve months with regard to the removal of the various freight rate anomalies and inequities which have existed in the country for the last 18 months, and which have been the subject of debate in the House.
I think that this bill could be improved if the minister would accept the amendments which I have outlined. If that were done, I think the bill would be a very good bill for western Canadian wheat producers as it would give some stability to the domestic grain trade. As it stands in its present form I do not believe this legislation gives the western wheat producer a fair deal.
There is something else that I would like to say in connection with wheat. It seems to me that the initial price is far too low in terms of current prices on the international market, as well as in terms of the domestic market. I urge the minister to undertake an adjustment immediately.
I just had a call from a producer in Vermilion who told me that he was getting $1.80 per bushel for wheat which he was selling to an elevator through the Canadian Wheat Board. He could sell the wheat as feed for $2.80, although it is not feed wheat. Many producers are uncertain as to what route they should take, and they are looking for guidance.
Surely, with the prices in the $5 to $6 range, it seems to me only reasonable to request that an upward adjustment be made quickly because now is the time when producers need money to pay their farm expenses, to settle their

debts, and to prepare for a long, but I hope, not cold winter.
I should like to conclude by saying that I hope the minister will seriously consider the comments that I have made, and will decide to help the western wheat producers at a time when it is urgent to do so, because I fear that the wheat that has been harvested this year is of a much lower grade than usual and, as a result, will bring in lower prices which will have a detrimental effect on the gross and net incomes of the producers.
Many grain producers and small livestock producers find themselves in a difficult situation. An adjustment of the initial price, as well as some assurance of a stable wheat market, at least on the domestic scene, would certainly provide the kind of climate that is conducive to a strong and healthy agriculture.


Lorne Edmund Nystrom: Mr. Speaker, Bill C-19 before us this evening is almost identical to Bill C-33 which died in the last parliament. The only difference between them is the date at which they come into force. Bill C-33, with which we would have dealt in the last parliament, would have come into force several months earlier, but last Friday parliament voted, in supplementary estimates, the money for the previous several months, with which we will not deal so far as this bill is concerned.
The bill before us today basically does two or three things. It establishes the floor price for the next seven years for wheat and Durum. The floor price is a guarantee of what the farmers, no matter what happens to the international price of wheat, will receive for wheat that is sold domestically. I think it is a step that all members of the House support in principle, and it is one that our party has advocated for many years. Before I entered politics I remember hearing a spokesman for our party call for a two-price system and price guarantees. Members of the cabinet at that time dismissed it as socialistic nonsense, something that was completely impractical. One of the chief detractors was, as the hon. member for Regina-Lake Centre (Mr. Benjamin) says, a Saskatchewan Senator. Now this Utopian nonsense is becoming law. Perhaps the pressures of the last parliament forced the government to wake up to the needs of the western farmer.
The subsidy provided in the bill is $1.75. That means that if the price for international grain is $3.25, with the subsidy the farmer will receive $5 a bushel. If the guaranteed price for Durum wheat is $5.75, with the subsidy of $1.75 he will receive $7.50 a bushel.
It should be stressed that it is not only the consumer who is paying for this type of legislation. As has already been made clear by the hon. member for Vegreville (Mr. Mazankowski), the farmer is taking a loss because of the present two-price system. From some figures I saw last Saturday I noticed that wheat is selling for $6.04 on the international market. That is about a dollar above the price the farmer is getting for domestic grain sold for human consumption. It means that the government is making a sacrifice in order to keep the price of bread
October 29, 1974

down. This is basically a good step, but it should be made permanent.
The whole philosophy of price guarantees and price supports should be applied to all farm products. The principle is sound. If there were price guarantees farmers would be able to plan in the spring-f.or what they would receive in the fall. The farmer gambles on the weather, on world conditions, on the international market; why he should have to gamble with government programs is beyond me.
I should like to see an amendment moved in committee to provide for the indexing of the price to the farmer for wheat consumed domestically. Maybe we should index the floor price, or the government subsidy, or the ceiling price. If not, the farmer could find the price of grain frozen for seven years while his costs of production skyrocket. Perhaps there could be indexing in the manner that has been developed for taxation, old age pensions, family allowances and such things. The basis of the index could be the increase in the costs of production. The alternative would be a clause in the bill to provide for review by the House of Commons each year. If an upward adjustment were necessary, then this House would make it.
Another point is that we should provide for policing of the bill. One of its purposes is to provide a consumer subsidy so that an increase in the price of wheat will not necessarily mean an increase in the price of bread. When there are subsidies or taxcuts on items like clothing or children's footwear the saving is not always passed on by the wholesalers or retailers, but is sometimes regarded by them as extra profits or dividends for their shareholders. This legislation should be policed to make sure that that does not happen with this subsidy. It is not intended for the companies, for Weston's or any other miller.
This legislation was first announced in September, 1973, Womhor tVwa millers annntinrpd that the Drice of a loaf would be increased by four cents. After pressure from this House and the Food Prices Review Board, the increase was rolled back to two cents. Despite the fact that the price of wheat had not gone up, in August, 1974, the millers announced that the price of a loaf would go up by three cents in the middle of September. So, since this legislation was introduced the price of bread has gone up by five cents a loaf despite the fact that the price of wheat has not increased. We are aware that there are many other inputs in the price of a loaf, but I wonder whether the five-cent increase reflects the legitimate costs to the bakers.
If we pass this legislation it seems to me that the Food Prices Review Board or some such body should police it to make sure that someone is not pocketing the subsidy at the expense of the Canadian taxpayer.
Those are some of the concerns I have about the bill, Madam Speaker. We support it in principle, but we should keep in mind that it is only a small step, toward providing the farmers of western Canada and the other wheat producers with income security. We must have a stabilization plan to cover all products and to take into account the increased costs of production. Unless we have that, farmers will not be able to continue in business.
Wheat Payments
We just have to look around the world to see how people are starving. This should be one of the first considerations of the food conference in Rome in November.
There should be price guarantees, floor prices, price supports on all farm products whether consumed domestically by human beings, or exported. If we do this we will not only help the Canadian farmer but will be playing our part in the world as a great food producing nation.
We must also consider the very low initial payment when we talk about wheat. Wheat is now selling in the world market for about $6 a bushel, yet farmers in my area are getting only $2 per bushel initial payment because the Wheat Board is holding back $4. That is like saying to any worker that a half or two thirds of his income will be held until the end of the year, and then paid to him without interest. How would members of parliament react if 50 per cent of their salary were held back for nine or ten months and then paid without interest? Yet that is the way we are treating our farmers, and it must be changed. I hope the minister will have an announcement on it shortly.
Another thing that concerns me is that the initial price of feed grains is being held down and, as a result, many farmers are going to the open market where they get a higher price for grain delivered on the spot. It seems to me that there is a sly hand in this. I am suspicious of why the minister is not raising the initial price of feed grains, and wonder if he is trying to drive farmers to the open market so that he can then say that they do not use the Wheat Board. The government wants to sell feed grain on the open market. Obviously it does not want the Wheat Board, and thinks that perhaps we should get rid of it. How can the government's approach to orderly marketing be in the best interests of the farmers of this country? How can low initial payments-


Mr. Mclsaac:: On a point of order, Mr. Speaker, although I am interested in the remarks of the hon. member for Yorkton-Melville (Mr. Nvstrom) who is speaking on feed grain policy, let me remind him that the bill before us deals with the implementation of a two-price system for wheat. Surely he can take all the latitude he wants in talking about the two-price system for wheat without talking about a totally different matter.


Mr. Deputy Speaker:: Order, please. I am sure the hon. member will revert to the subject matter of the bill. I think he has nearly concluded his remarks.


Lorne Edmund Nystrom: Mr. Speaker, the parliamentary secretary has completely misunderstood my remarks. Perhaps I should start at the beginning. I am talking about the bill before us, and suggesting that the government should not introduce legislation like this in isolation. We need other bills of this kind. This is but one step in the right direction. We need more legislation which will guarantee prices for farmers so that we can protect them from the peaks and valleys of the open market. My remarks apply as much to feed grains, or wheat sold internationally, as to wheat sold domestically for human consumption in this country.
I am talking about the broad situation concerning farmers. We should not look at this in the narrow sense; let us

October 29, 1974
Wheat Payments
look at the entire picture, something the Liberal government has not done in the last number of years. It has tended to respond in an ad hoc way to issues which have arisen. In the previous minority parliament it responded this way to pressures put on it, and it is still responding this way. The Liberal party is good at straddling both sides of the fence. You could get a lot of slivers that way. I am saying that this is good legislation, that it should not be an isolated instance, and that it should be followed by other legislation which will help our farmers to stay on the land. If they stay, and if their prices are guaranteed, they will produce food.
The world needs desperately the food Canadian farmers can produce. The days of the LIFT program and the old stabilization plan are over. They will not come back. The first two or three years after the minister in charge of the Wheat Board assumed his current responsibilities were among the darkest Canadian grain farmers have ever experienced.


Joseph Clifford McIsaac: Mr. Speaker, I am pleased to have the opportunity to speak in support of this bill which will implement a two-price system for wheat, something that has been promised for years, and talked about by members of all parties in this House.
I was really pleased to hear the hon. member for York-ton-Melville (Mr. Nystrom) say he will support the bill. He took a lot of time reviewing other issues which have nothing to do with the bill, but after talking a long time he decided, as the NDP has done both in this House and in provincial forums across the country, to support it.
I was disappointed in the remarks of the hon. member for Vegreville (Mr. Mazankowski). His party at one time had the chance to implement this kind of policy, but did not take it. It has finally been introduced by the minister who sits in front of me, the hon. member for Saskatoon-Humboldt (Mr. Lang).
The hon. member for Vegreville was being irresponsible in criticizing the bill because it did not deal with some minor issues. He raised some interesting points, however. For instance, if in two or three years the $5 figure does not seem to meet the need, it can be changed. The point is that we are adopting a principle, one I am happy to support and one which has the support of many provinces.
We are dealing with the establishment of a two-price system. This bill will establish that two-price system and the minister should be proud of it. I think practically every member of the House supports it. Hon. members ought to consider some points made by the hon. member for Vegreville. Perhaps we should do for feed grains what we are doing for wheat. Perhaps that way we could provide part of the answer for the difficulties besetting the livestock industry. Perhaps this principle ought to be applied to that industry.


Thomas Gordon Towers: Mr. Speaker, is the hon. member for Battleford-Kindersley (Mr. Mclsaac) prepared to tell wheat producers in his constituency that $60 million is a small issue? That is what we are talking about. He criticized the remarks of the hon. member for Vegreville (Mr. Mazankowski), but I cannot accept $60 million as a small issue. The fact is that when the government offered

to support the grain industry to the tune of $50 million a few years ago, it felt it was providing the western grain producers with a great benefit.
Let me point out that approximately 60 million bushels of western grain are used for the domestic industry and approximately seven million or eight million bushels of wheat are purchased from wheat growers in Ontario.
For the information of hon. members, the world price of grain today is $6.20 per bushel, which means that the western Canadian producer is subsidizing the industry to the tune of $1.20 per bushel. That is not chicken feed and must be looked at seriously. We will not be able to live with this in the future. That is why we, on this side of the House, are prepared to move an amendment in committee. Hopefully the minister will accept it and other minor changes which are acceptable to the farmers he represents. May I call it ten o'clock, Mr. Speaker.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Walter C. Carter (St. John's West):: Mr. Speaker, my question to the Prime Minister (Mr. Trudeau) and to the Secretary of State for External Affairs (Mr. Mac-Eachen) of October 3 was prompted by statements that were made by two ministers, the Minister of Regional Economic Expansion (Mr. Jamieson) and the then minister of fisheries, Hon. Jack Davis, during the July 8 election campaign. The statements in question concerned the Law of the Sea Conference and the action allegedly proposed by the government if our country's position with respect to jurisdiction over our off-shore resources was not accepted by the member nations represented at the conference.
Both ministers are reported to have said categorically that the government was prepared to act on its own and declare unilaterally its jurisdiction over the continental shelves off our coasts. The Minister of Regional Economic Expansion made the statement in Corner Brook, Newfoundland, on June 24, at a political rally at which the Prime Minister was present. The former minister of fisheries, Mr. Davis, made a similar comment in a statement which was prepared by him in Vancouver and released in Halifax on June 15, to coincide with the closing meeting being held there of the International Commission for the Northwest Atlantic Fisheries, ICNAF.
In reply to my question of October 3 the Prime Minister (Mr. Trudeau) questioned the accuracy of the press reports to which I referred. At the same time he stated
October 29, 1974

quite emphatically that unilateral action would not be taken by his government to protect our fishing industry and our fishermen against the plundering of foreign nationals.
The conservation and management of our rapidly dwindling fish stock is a matter of grave concern to our fishermen. It should not have become the subject of such blatant political dishonesty on the part of this government and in particular the two responsible ministers.
Our fishermen have been used as pawns and the butt of political chicanery almost since the industry began. They have been victimized, exploited, and almost dehumanized for centuries by unscrupulous fish merchants, and have been used in every way possible by likewise unscrupulous politicians. Is it any wonder they have lost confidence in the industry and view with suspicion the actions of their political leaders?
If the government is unwilling to honour the commitment that was made by two of its members during the election campaign, the very least we should expect is that the Prime Minister or the Minister of State (Fisheries) (Mr. LeBlanc) tell the fishermen of this country precisely what their intentions are with regard to the management and control of our marine resources.
The minister or his parliamentary secretary will no doubt tell us this evening that they are placing all their bets on the outcome of the next Law of the Sea Conference. The minister's predecessor, Mr. Davis, told us the same thing five years ago.
We want to know, and even more important our fishermen want to know, what action the government will take if we have no more success at the next Law of the Sea Conference than we had at the one held in Caracas earlier this year. Is the government prepared to abandon its powder puff, nice guy approach and tell the other nations of the world that, with or without their concurrence, we intend to lane cuntiui ui uui iiLuitutal shelf and the resources that lie thereon, or is it going to sacrifice the fishing industry and our fishermen for the sake of diplomatic niceties and being thought of as nice guys?


Mr. Herb Breau (Parliamentary Secretary to the Secretary of State for External Affairs):: Mr. Speaker, the hon. member knows that what he said in closing is not correct. We will not let the fishing industry down.
The question has been raised whether Canada should now proceed unilaterally and extend its fishing jurisdiction to the edge of the continental shelf. As the House is aware, Mr. Speaker, the world community is presently engaged in bringing the Law of the Sea in line with the political and economic realities of our times.
A first session of the Law of the Sea Conference was held last summer in Caracas. Given the large number of participating countries, over 135, and the many complex issues to be resolved, it was not possible to elaborate, in all its details, a treaty dealing with all the aspects of the subject.
However, during the Caracas session real progress was achieved. It became apparent that a future Law of the Sea Treaty could only be agreed upon if coastal states were recognized as having effective rights with respect to both
Adjournment Debate
living and mineral resources, as well as for the protection of the marine environment. These rights will be exercised by the individual coastal state in an "economic zone", which is generally conceived as extending to 200 miles from the coast. However, the question of whether such rights would go beyond the 200-mile limit and reach the edge of the shelf did not receive the same degree of support as was given the economic zone concept. Canada is, however, hopeful that some arrangement can be worked out in this sense.
In these circumstances would it be timely for Canada to extend its fishing jurisdiction unilaterally? I would submit, Mr. Speaker, that, as a responsible member of the international community, Canada should aim at a widely accepted Law of the Sea and, as a consequence, should give the United Nations Law of the Sea Conference a chance to succeed. We are confident that it will. This does not mean that the government is not conscious of the need to prevent over-exploitation of the living resources off our coasts, even before the conference ends. Indeed, through action as a member of international bodies such as ICNAF, as well as through bilateral consultations, the government is constantly trying to control this situation.
The best way for Canada to acquire sufficient powers to remedy this problem is through international agreement. In present circumstances unilateral action would only create confusion and controversy. I would also add that control of the living resources over the continental margin would fall short of providing adequate protection for salmon. That particular issue also calls for international acquiescence in the rights of the state of origin.
In brief, Mr. Speaker, unilateral action, though not called for at the moment, could very well be considered as a matter of policy if the Law of the Sea Conference fails, within a reasonable period of time, to reach a satisfactory solution as regards the interests of coastal states in their offshore living resources. This coincides with the view taken by the Prime Minister (Mr. iruaeau^ in ibis House on October 3, as well as with the statements made by other ministers before that.


STORMS-ATLANTIC PROVINCES-REQUEST FOR AID FROM PRINCE EDWARD ISLAND
Mr. Heath Macquarrie (Hillsborough):: Mr. Speaker, it is well known that I participate frequently in what is called the "Late Night Show". Some people ask why, and the answer is that I am a great lover of crowds and there is nothing like a large and enthusiastic audience to turn me on.
A few days ago I asked a question about the measures being taken to assist the people of Prince Edward Island who suffered severe crop damage, besides loss of electricity and telephone services, as a result of a severe storm in what is well know as the garden province. The Parliamentary Secretary to the Minister of Finance (Mr. Cullen) seemed to be well briefed on the issues and I congratulate him on the lucidity, fulsomeness and directness of his reply. He might well serve as a model to other parliamentary secretaries, and indeed to those lofty incumbents of the treasury benches.
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Adjournment Debate
A great many islanders were seriously inconvenienced for a period of a week and, in some cases, for a little longer. Shortages of utilities, water, light and fuel made life difficult for the people and for their farm animals. There was a threat to our valuable potato crop and to such grain as was not harvested. I now hear less disturbing reports than were coming my way when I first asked the question. Yet to many people this was not an inconvenience of a minor nature. For a week it was impossible to telephone to my residence in Prince Edward Island, as I discovered daily. Many homes were unheated for days. The utility companies moved as best they could to get things back to normal.
My main concern has to do with the alacrity of the movement of aid toward provinces and regions affected by seriously adverse weather conditions. From time to time in this House I have heard members bring forward appeals arising from emergency situations in their home areas, inquiring about federal aid and being advised that no official request had yet come from the province concerned. In many cases speed is of the essence, and I would urge greater co-ordination so that there might be a diminution of the waiting period.
In July of this year a freak storm damaged crops in my constituency. Appeals for compensation were made, discussed and processed, but it was a long time before the victims of the storm were able to receive funds, or even to receive assurances as to the measure of aid which would come to them. In these days it is not easy to wait. Time is money, and during a period of inflation money is shrinking.
It is ironic I should be talking about two grim assaults from nature on Prince Edward Island-strange, because this summer was one of the most beautiful and balmy in the island's history, as many thousands of tourists can testify. I appeal for a method whereby the whole procedure for making aid available in such cases can be improved and expedited.


Jack Sydney George (Bud) Cullen: Mr. Speaker, I thank the hon. member for his kind comments. One of the things which make this country great is the fact that although there is a problem in Prince Edward Island the heart of the rest of the country goes out to the people there in the disaster they face.
Federal policy on disaster assistance has, since 1970, taken the form of reimbursing provincial governments on the basis of a per capita formula for the expenditures made by the provinces in dealing with a disaster. It seems to indicate that kind of thrust the hon. member seeks, and I am sure all hon. members seek, in dealing with disasters or problems in their immediate areas. But the initiative must be taken by the province to determine the size of the disaster and the kind of assistance that is required, and then it must make an application to the federal government.
There is, however, as the hon. member knows, a formula set up for the sharing of the cost, and the formula is equal to the amount of $1 multiplied by the population of the province. When the sum exceeds that amount there is an ever increasing formula of contribution at the federal level.
Generally speaking, eligible expenditures are those made by a province for the restoration of essential property of private individuals, small businesses and farmsteads, and public works, to their pre-disaster condition. These guidelines limit cost sharing for agricultural losses to payments made to restore farmlands to workable condition where a farm operation has been seriously affected by flood erosion or land gouging.
Payments made for the restoration of farm buildings and equipment would also be eligible, since they would represent payments made for restoring the essential private property of the farmers concerned. The basic federal measure for assisting farmers who suffer losses on account of damage to farm products is the Crop Insurance Act. This act is given effect by means of the federal-provincial crop insurance agreements which have been contracted between the federal government and the various provinces.
I think it is fair to say that Prince Edward Island has sought advice on what provincial expenditures, related to the earlier storm of July 3, would be eligible for cost sharing. If a similar request is received from Prince Edward Island regarding expenditures related to the recent storm, it will receive prompt and sympathetic consideration. But the initial thrust, as the means of expediting assistance, has to come from the province, which has to determine the size of the disaster and the amount of funds it is seeking.
Motion agreed to and the House adjourned at 10.15 p.m.

Wednesday, October 30, 1974