1975-07-02

ROUTINE PROCEEDINGS


Mr. Gordon Towers (Red Deer):: Mr. Speaker, I rise under the provisions of Standing Order 43 to present a motion which I trust hon. members opposite will seriously consider. In view of the exasperation and indignation of Canadians created by the method of imposing the 10 cents per gallon gasoline tax, increasing the cash flow requirements of bulk dealers, retailers and consumers, I move, seconded by the hon. member for Peace River (Mr. Baldwin):
That the House of Commons request the Minister of National Revenue to place a moratorium on this gasoline tax until the issue has been fully debated or until such time as a more acceptable method of administering it is instituted.


Mr. Speaker:: Order. The motion being moved pursuant to Standing Order 43 requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


PENITENTIARIES
Mr. Roch La Salle (Joliette):: Mr. Speaker, pursuant to the terms of Standing Order 43, I request unanimous consent of the House to move a motion dealing with an important and urgent matter.
As the Public Service Alliance of Canada decreed that today, July 2 would be a day of national mourning for the death of a penal agent, namely Mr. Paul Gosselin, who died under circumstances everyone is aware of, I move, seconded by the hon. member for Frontenac-Lennox and Addington (Mr. Alkenbrack):
That this House observe the minute of silence as a tribute of condolences to the bereaved family.


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


Some hon. Members:: Yes.


Some hon. Members:: No.


Mr. Speaker:: As there is not unanimous consent, the motion cannot be put.


FINANCE
Mr. Rene Matte (Champlain):: Mr. Speaker, pursuant to Standing Order 43, I seek the unanimous consent of the House to move a motion on a matter of urgent and pressing necessity.
Considering the already critical financial circumstances of a great many of our senior citizens who must be satisfied with nothing more than their old age security pension and income supplement cheque, and in view of the fact that some of them have only their cars as means of transportation, I move, seconded by the hon. member for Richmond (Mr. Beaudoin):
That old age pensioners be reimbursed the special 10 cent tax on every gallon of gas.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


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


ADMINISTRATION OF JUSTICE
Mr. Otto Jelinek (High Park-Humber Valley):: Mr. Speaker, pursuant to Standing Order 43, I rise to propose a motion in a case of urgent and pressing necessity. In view of the continuing lack of adequate security within our federal prisons and penitentiaries, and because of the increasing discontent by federal prison guards and police

July 2, 1975
Distinguished Visitors
forces as well as the Canadian public relating to the fact that this government is unwilling to uphold the law of the land as it now stands in regard to capital punishment, I move, seconded by the hon, member for Central Nova (Mr. MacKay):
That the Prime Minister demand forthwith the resignation of the Solicitor General for his inability to cope with the ever increasing multitude of problems plaguing his department and for not upholding the law of the land, and appoint in his place an individual who will respect the laws as laid down by this parliament and follow them accordingly.


Mr. Speaker:: Pursuant to Standing Order 43, this motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


FINANCE
Mr. Eudore Allard (Rimouski):: Mr. Speaker, under Standing Order 43, I ask the unanimous consent of the House to introduce a motion concerning an important issue of urgent necessity.
Since the Minister of Finance is frankly admitting the failure of his financial policies and since those policies would imply a constant increase in interest rates to cope with inflation, I move, seconded by the hon. member for Champlain (Mr. Matte):
That the minister should now try to reduce the interest rates to the level they had reached when the economic development of the country was satisfactory, due to the deficiencies of the system, that is a normal rate of 6 per cent.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


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


PRESENCE IN GALLERY OF DELEGATION FROM PARLIAMENT OF AUSTRALIA AND MEMBERS OF FINANCE COMMITTEE OF PARLIAMENT OF SWEDEN
Mr. Speaker:: Before beginning the question period, it is with great pleasure that I call the attention of hon. members to the presence in our gallery of two distinguished visiting delegations. The first is a combined delegation of the Senate and the House of Representatives of the Parlia-

ment of Australia, inquiring into procedures in vogue in our committee system and other procedures.


Some hon. Members:: Hear, hear!


Mr. Speaker:: This delegation consists of four distinguished individuals; one senator and three members of the House of Representatives, and is led by the very distinguished member of the House of Representatives, Dr. H. A. Jenkins.


Some hon. Members:: Hear, hear!


Mr. Speaker:: In addition, we are honoured by the visit of a number of distinguished members of the finance committee of the parliament of Sweden, led by the very distinguished representative, Mr. Sven Ekstrom.


Some hon. Members:: Hear, hear!



ORAL QUESTION PERIOD


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, I should like to address a question to the Solicitor General, reminding him that some five weeks ago, on May 26, the Prime Minister assured the House that the Solicitor General would be making a statement in the "fairly near" future on the government's intention in respect of capital punishment, and capital punishment legislation. Can the Solicitor General now give us a firm date as to when this statement will be made by him?


Hon. Warren Allmand (Solicitor General):: No, Mr. Speaker, and I doubt whether the statement will be ready before the end of this month.


An hon. Member:: After the break.


Some hon. Members:: Oh, oh!


Robert Lorne Stanfield: Mr. Speaker, will the Solicitor General not agree with me that he now finds himself in a dishonest position?


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: Having presented a bill to the House, asking parliament to adopt it, which demands capital punishment in the case of murder of prison guards and policemen, with the Solicitor General now saying and having said for sometime that he could not remain in a government which permitted such an execution to take place, does the minister not find himself in a dishonest position, and when is he going to do something to correct it?
July 2, 1975


William Warren Allmand: No, Mr. Speaker, I do not. That bill was the best possible bill I could get passed by the House at the time.


Some hon. Members:: Oh, oh!


William Warren Allmand: I did try to amend it but the amendments were ruled out of order. I do think that I can rectify the situation as soon as possible by presenting legislation to the House.


An hon. Member:: By resigning.


Some hon. Members:: Oh, oh!


Robert Lorne Stanfield: Mr. Speaker, I am not asking these questions and supplementaries because I necessarily disagree with the Solicitor General in respect of capital punishment. I do want to ask the Solicitor General whether he considers this to be consistent with his obligation to this House; that is, to have asked this House and this parliament to adopt legislation which he, as a responsible minister, is not prepared to execute despite the declared intention of parliament?


Some hon. Members:: Hear, hear!


William Warren Allmand: Mr. Speaker, the decision on commutation is a decision which rests with the Cabinet and not just with myself. Furthermore, I should point out that when the bill on capital punishment was before the House there was no attempt made by the opposition to restrict the power of commutation.


Some hon. Members:: Hear, hear!


An hon. Member:: But this is an abuse of that power.


ADMINISTRATION OF JUSTICE
Mr. J. P. Nowlan (Annapolis Valley):: Mr. Speaker, I direct my question to the Solicitor General. At this particular time when we have just had a message from the Prime Minister on the maturity of this country, and also some speeches by him about respect for the law, does the Solicitor General not consider that possibly many Canadians consider it a perversion of the judicial process when we have almost computarized commutations accompanied by a statement by the Solicitor General that he could not belong to a government which did anything else but commute the sentences, regardless of the circumstances?


William Warren Allmand: Mr. Speaker, I should point out to the House that since the present law was adopted in 1968 there have only been six cases of commutation, and in five of the six cases there was a recommendation for clemency. It is the government's policy that each application for commutation should be dealt with on its own merits.
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John Patrick (Pat) Nowlan: I have a supplementary, Mr. Speaker. On this very sensitive issue would the Solicitor General assure the House that his personal philosophy and private convictions do not have priority over public safety and administration of the laws of the land.


William Warren Allmand: Mr. Speaker, our first priority in the government is the safety of the public and our staff.


PENITENTIARIES
Mr. Stuart Leggatt (New Westminster):: Mr. Speaker, I should also like to direct a question to the Solicitor General dealing with this subject, the question of safety of the staff within the institutions. Would the Solicitor General advise the House whether in the area of the B.C. penitentiary where the Steinhouser tragedy occurred security arrangements have been changed in the institution which call for only one guard in the classification area of the penitentiary? Has anything been done in respect of that specific problem?


William Warren Allmand: Mr. Speaker, I have asked that measures be taken to correct that sort of thing. In addition, since we do not know all the causes or reasons for the recent incident at the British Columbia penitentiary we are awaiting the recommendations of the Farris Commission but have asked that additional security measures be taken immediately. At the moment, I cannot give the hon. gentleman details of that.


Stuart Malcolm Leggatt: Mr. Speaker, would the Solicitor General advise the House whether the government has accepted the general policy outlined in the Mohr Commission report that inmates considered dangerous in an institution be segregated in separate institutions in smaller numbers. The report recommended that something like 80 in British Columbia should be segregated in a separate institution.


William Warren Allmand: Yes, Mr. Speaker. The government accepted that recommendation more than a year ago. We have approved plans to build institutions of that kind. The difficulty has been in getting communities to accept maximum security institutions. I should point out that even the city of New Westminster, which has the present maximum security penitentiary, has advised that it does not want any new institutions there. We are presently looking for sites for such institutions which will house the most dangerous inmates in our society.


Stuart Malcolm Leggatt: Mr. Speaker, in view of the fact that the Mohr Commission report came down in November of 1971, now nearly four years ago, and in view of the number of budgets which have come before this House and the number of budgets the Solicitor General has had to take through cabinet, why is it that after all this time action has not been taken to expropriate the land and get to work on the project regardless of any other reasons. Would the

July 2, 1975
Oral Questions
Solicitor General advise the House why we in fact have been foot-dragging in respect of creating the new institutions recommended in the Mohr Commission report.


William Warren Allmand: Mr. Speaker, as I said we approved construction of these institutions some time ago but we have also adopted the policy that we will consult with provincial and municipal governments as well as local M.P.'s when we build institutions. We do that not only with penal institutions but also with airports. When we have not done that we have had much criticism from the opposition side for going ahead with such institutions without consultation.


OLYMPIC GAMES
René Matte: Mr. Speaker, I have a question for the Postmaster General.
Could he tell the House what the present situation is with regard to the sale of Olympic coins? Does he still believe that such a means of financing the games will prove to be efficient, and has he considered other means if ever the sale of Olympic coins is proven ineffective beyond the shadow of a doubt?


Hon. Bryce Mackasey (Postmaster General):: Mr. Speaker, two years ago this government promised to help finance the games with $292 million. I am convinced that through the Olympic Lottery, Olympic Coin and Olympic Stamp programs, we shall be putting more than $300 million into the COJO coffers.


GASOLINE-SUGGESTED DELAY OF NINETY DAYS BEFORE IMPOSITION OF TAX TO ALLOW INVENTORIES TO BE EXHAUSTED-REQUEST FOR TABLING OF REFINERY INVENTORIES
Mr. James Gillies (Don Valley):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources. In the budget speech of June 23, the Minister of Finance, in announcing an increase in the price of crude oil by $1.50 a barrel, said that industry is being asked to hold back passing through this increase for 45 days in order that inventories can be worked out. Inasmuch as there is some indication, particularly in the province of Ontario, that inventories are now running perhaps 90 days, will the minister give consideration to re-examining the time before the pass-through will be allowed in order to more accurately reflect the inventory situation and save the Canadian taxpayers from having this increase in price any sooner than necessary?


Hon. Donald S. Macdonald (Minister of Energy, Mines and Resources):: Mr. Speaker, it is true that some of the 
refineries, particularly those of the larger companies, have either in the pipelines or in tanks greater than a 45 day inventory. It is also true that a number of the smaller refineries, Saskatchewan Co-operative for example, have less than 45 days inventory. The 45 day figure used in this context is regarded as the lowest common denominator that would be fair to the small refineries without giving too much advantage to the major refineries. I read, as the hon. member has, the statements made by the Premier of Ontario to the effect that he might put those restrictions on Ontario refineries. That, of course, would be within his jurisdiction if he chose to do so. It would not affect other smaller refineries such as the Saskatchewan Co-operative.


James McPhail Gillies: Can the minister make available to the House, possibly by tabling, the information with regard to the inventories of the various refineries across the country?


Donald Stovel Macdonald: Mr. Speaker, I will be glad to seek that information and make it available to the hon. member.


FINANCE
Thomas Gordon Towers: Mr. Speaker, my question is to the Minister of Finance. Has provision been made in the money supply for the extra cash flow requirements of dealers and consumers for the 10 cents a gallon gasoline tax or will there be a resulting shortfall in the cash requirements of other sectors of our economy?


Hon. John N. Turner (Minister of Finance):: Mr. Speaker, it is hard to be precise and brief in the question period on that particular question.


Thomas Gordon Towers: Can the minister tell this House what the inflationary factor would amount to as a result of the 10 cents per gallon tax on gasoline, not only of the tax itself, but also its administration and the extra costing of cash flow requirements to the distributing and consuming public?


Mr. Speaker:: Order, please.


ADMINISTRATION OF JUSTICE
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, my question is for the Solicitor General. In his answer to an hon. member, the minister stated that of the six cases since 1968 in which reprieves were granted, there were recommendations to mercy in five instances. At a time like this when morale is very low among police officers and the like, it is sometimes forgotten there can be no action by parliament to interfere with the right of the Queen in her Council to exercise mercy. However, that
July 2, 1975

answer was rather surprising to me. In how many of the six cases was there a recommendation to mercy by the jury?


William Warren Allmand: Mr. Speaker, I already said there were recommendations of mercy in five of the six cases that were commuted since 1968. The only one in which I was involved, about a year ago, there was a recommendation for mercy.


John George Diefenbaker: The minister has chosen to take the example of six cases. Surely he can tell us this. In the other five, was there a recommendation to mercy by the jury?


William Warren Allmand: Mr. Speaker, the right hon. member misunderstands what I have said. I said that since 1968 there have been only six applications for commutation and in five of those cases, there was a recommendation for mercy.


John George Diefenbaker: By whom?


William Warren Allmand: By the jury. In five of the six cases there was a recommendation for mercy by the jury. In the sixth there was not, but I was not in the cabinet then and I do not know on what basis it was commuted.


John George Diefenbaker: I do not think that answer is right. You had better check it out.


URANIUM-REQUEST FOR ASSURANCE OF ADEQUATE RESERVES
Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I have a question for the Minister of Energy, Mines and Resources. In view of the statement made last Monday in Regina by the executive co-ordinator of the Ontario ministry of energy, policy section, that demand for uranium will increase ten times during the next 25 years, can the minister assure the House and the country that while the export of uranium is being permitted and encouraged, there are adequate reserves for Canada's needs in the foreseeable future so that our country will not be in the same position we are in now without petroleum and natural gas resources?


Donald Stovel Macdonald: Mr, Speaker, if the hon. gentleman would like to look back, he would note that I have stated before in the House what are the reserve requirements which Canadian producers must have before the export of uranium will be eligible from Canada. We have set out before the House a precise formula for a surplus to meet Canadian requirements and a stipulation that no exports can be made by individual mines either on the basis of reserve or producibility if they cannot meet the specific requirement set up for that particular mine.


Elmer MacIntosh MacKay: Does the minister agree that if Canada is prudent in its export policies we will have reserves for 25 years in this country, or does he have a different appreciation of the situation?
Oral Questions


Donald Stovel Macdonald: I would to check the actual figures. It will depend very much on the value per pound which one sets on it. Obviously, the higher the pric* for uranium, the more that is recoverable from any particular deposit. Perhaps the best thing I could do is to obtain a reference for the hon. gentleman for the reserve formula which, as I say, has already been set out before the House.


SUGGESTED NEED FOR INCENTIVES TO INCREASE COMPETITIVE POSITION OF MANUFACTURED GOODS- GOVERNMENT POSITION
Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, I have a question for the Minister of Industry, Trade and Commerce on his return from Japan.


Some hon. Members:: Hear, hear!


George Harris Hees: I might say to hon. members that in Japan, as far as I can see, he achieved practically nothing.


Some hon. Members:: Oh, oh!


An hon. Member:: At least he is consistent.


George Harris Hees: As only 2.8 per cent of Canadian exports to Japan are manufactured goods, the products which produce jobs, and as the minister was told by the Japanese minister of industry, trade and commerce, when he asked for a bigger proportion of that market for our manufactured goods, that, and I quote, "Japan is a free market, and you must sell your goods here," I would ask the minister if he now, at long last, intends to introduce some effective incentives to increase our competitiveness in this particular class of goods so that we can obtain a larger and more satisfactory proportion of this and other important markets?


Hon. Alastair Gillespie (Minister of Industry, Trade and Commerce):: Mr. Speaker, I would agree with the hon. member that the proportion of our fully manufactured sales as a proportion of the total exports to Japan is far from satisfactory. Indeed, that was one of the main purposes of my discussions with my opposite number at the inter-ministerial meetings. I think we made it quite clear to the Japanese that we expected a more forthcoming attitude on their part toward Canadian manufactured goods, including such products as water bombers, STOL aircraft and highly sophisticated technology. We also were able to make very clear to them the importance of the upgrading of Canadian resources prior to export and the benefit to the Japanese in co-operating with us on this program.


George Harris Hees: As the Japanese minister made it very clear that we would not make additional sales in manufactured products unless we could compete successfully with other producers in that market, and as the minister has produced no effective incentives to increase our productivity or our competitiveness, when does he intend to stop kidding the public and to get on with job he was appointed to do?

July 2, 1975
Oral Questions


Mr. Speaker:: Order, please. The hon. member for Saint-Michel.


STATUS OF WOMEN
Miss Monique Begin (Saint-Michel):: Mr. Speaker, I have a question for the minister responsible for the status of women in Canada.
I would like to know if the minister can tell the House what line of action he intends to take to ensure that the most basic rights of Mary Two Axe Early and the 35 or so Indian women of the Caughnawaga reservation are respected in view of the eviction notices which they have been served under the Indian Act by Chief Kirby?


Hon. Marc Lalonde (Minister of National Health and Welfare):: Mr. Speaker, I believe that the whole Canadian population regrets such an action when we are discussing amendments to the Indian Act. The Indian representatives themselves have shown their interest concerning the possibility of certain amendments, these are now being discussed by the representatives and the Minister of Indian Affairs, and I would have thought it possible to postpone any action of this type until the Indian representatives and the government have come to an agreement as concerns the amendments. Unfortunately, as long as the act remains in its present form, it is nearly impossible for me to intervene legally and to do something in this matter.


Monique Bégin: Mr. Speaker, I would like to ask a supplementary question.
Are we to conclude that in the five years that this act has been under study, the Indian women are used as hostages as regards their most basic rights for negotiations concerning all Indians and Canadians?


Marc Lalonde: The position of the government in this matter is well known, but the question of the hon. member should be directed to the Indian representatives rather than those of the government.


CANADIAN PACIFIC RAILWAY
Mr. David Orlikow (Winnipeg North):: Mr. Speaker, my question is for the Minister of Transport. Has the minister had an opportunity to look into the announcement by CPR that it will lay off 3,000 workers, 1,200 in Montreal and over 1,000 in Winnipeg until the end of September?


Hon. Jean Marchand (Minister of Transport):: Mr. Speaker, I read that the CPR decided to lay off about 3,000 employees. I immediately got in touch with CNR to find

out their intention but they do not intend to lay off any workers for the time being. As far as these others are concerned, it is a matter of negotiation. I have received no representation from the union and I will wait for that before doing anything.


EFFECT OF PROPOSED LAY-OFF OF MAINTENANCE WORKERS BY CANADIAN PACIFIC ON MOVEMENT OF THIS YEAR'S CROP
David Orlikow: Mr. Speaker, I have a supplementary question for the minister in charge of the Wheat Board. Will the minister look into claims of the union concerned in this lay-off to see if the effects will be felt primarily by those workers who usually spend the summer preparing freight cars for use in the shipment of grain in the fall? This lay-off could have an adverse effect on the shipment of this year's crop. Would the minister also determine whether what is involved is a ploy by the CPR to put pressure on the government to raise the rate paid for the movement of grain?


Hon. Otto E. Lang (Minister of Justice):: Mr. Speaker, I shall be glad to look at any representations from the union in regard to its position and the availability of cars. It seems to me, however, that the suggestion is a little far-fetched.


ENVIRONMENTAL AFFAIRS
Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, my question is for the Minister of the Environment. Almost a week ago I wrote a letter to the minister regarding serious allegations that had been made respecting radioactive waste and other waste from the Crown corporation uranium refinery in Port Hope, Ontario, and I have not had a reply. My question is twofold: Why have I not had a reply and what is the reply?


Hon. Jeanne Sauve (Minister of the Environment and Minister of Fisheries):: Mr. Speaker, the letter of the hon. member reached me only this morning.


Some hon. Members:: Oh, oh!


Jeanne Sauvé: I did not wait until I got the letter, however, to react to the situation which had been signalled in Port Hope. A representative from the Atomic Energy Control Board has been sent there to establish the radioactivity situation at this site. If it is found to be unsatisfactory, of course, corrective action will be taken immediately. However, one must distinguish between low level radioactive material and high level radioactive material. The material through which some seepage might occur is, of course, low level radioactive. The company has engaged consultants who are looking into the matter and we, with the Atomic
July 2, 1975

Energy Control Board, are also looking into it and will soon have a report on the situation.


Allan Frederick Lawrence: Mr. Speaker, my letter was delivered to the minister's office by hand last Thursday morning. Apart from that, however, the question relates to a public inquiry and an independent investigation. In the last ten years or so, monitoring had taken place by the Atomic Energy Control Board but my request to the minister was for an independent investigation and inquiry beyond that. Has the minister put her mind to that question as yet?


Jeanne Sauvé: No, Mr. Speaker, I have not contemplated such action and will not until I get a full report on the situation.


EXTERNAL AFFAIRS
Mr. Walter C. Carter (St. John's West):: Mr. Speaker, I have a question for the Secretary of State for External Affairs. Has the minister received a request from the minister of fisheries for Nova Scotia, Mr. Cameron, and the minister of fisheries for Newfoundland, Mr. Crosbie, that a meeting of the interested provinces be held to discuss marine resources and the possibility of unilateral action to protect those resources? If so, when will such a meeting be held?


Hon. Allan J. MacEachen (Secretary of State for External Affairs):: Mr. Speaker, I have received inquiries from both Mr. Cameron and Mr. Crosbie in reference to an undertaking I made during the Law of the Sea conference that at some point following the Geneva meeting I would convene the delegation as a whole to review the results of the conference and hear further views from those who had attended it. I intend to do that at a mutually convenient time.


POST OFFICE
Hon. W. G. Dinsdale (Brandon-Souris):: Mr. Speaker, may I put a question to the Postmaster General? In light of the disagreement that has arisen over the cost of postal automation between CUPW union officials and senior officials within the Post Office, would the minister explain the discrepancy in the figures quoted by both sides?


Bryce Stuart Mackasey: Mr. Speaker, I think the appropriate place to do that would be when my estimates are put before the House. The figures quoted by the union include work that has already been completed, work contemplated over the next three or four years and work that has nothing to do with automation. If
Oral Questions
the attitude on the part of the union is consideration of working conditions that were outmoded 30 or 40 years ago, then it is hard to negotiate with them.


Walter Gilbert Dinsdale: Mr. Speaker, the question was asked because we have not had a chance to consider the Post Office estimates this year. In view of the fact that these issues are raised as debating points, because of the continuing sensitivity of automation and the statement of the president of the union, Mr. Davidson, that Post Office employees will not be permitted to train in the new Mississauga plant until there is assurance of bargaining on the basis of technological change, could the Postmaster General give a definite assurance that the whole subject of technology and automation is being included in the critical contract negotiations under way?


Bryce Stuart Mackasey: Mr. Speaker, the conciliation efforts broke off as of yesterday. We are now moving to the conciliation board process where I think everybody will have ample opportunity to present the case on automation. We are again prepared to guarantee that nobody will be detrimentally affected by automation, a matter that Mr. Davidson does not seem to understand very clearly.


AGRICULTURE
Mr. Jake Epp (Provencher):: Mr. Speaker, may I put a
question to the Minister of Agriculture? The CEMA agreement was drawn up some time in April. Can the minister tell the House whether all parties have signed an agreement in principle and if so, can we expect an announcement on the implementation of import controls?


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, all provinces have not signed the agreement; one still has to sign. All producer groups have signed in all ten provinces and I am supposed to talk to the other minister of agriculture who has not signed at three o'clock this afternoon.


Arthur Jacob (Jake) Epp: A supplementary question, Mr. Speaker. Has the minister discussed proposed import controls with his counterpart in the United States, and what message has he received from his counterpart about retaliatory action the United States might consider if this program is implemented?


Eugene Whelan: Mr. Speaker, under the General Agreement on Tariffs and Trade, as long as proper supply-management policies are in force in a country when it imposes controls, theie is no retaliatory action that other countries can take. That is why I want to implement such policies before we impose border controls.

July 2, 1975
Oral Questions


APPOINTMENT OF CONSUMER REPRESENTATIVES TO FARM PRODUCTS MARKETING COUNCIL
Mr. James A. McGrath (St. John's East):: Mr. Speaker, may I direct a supplementary question to the Minister of Agriculture? Considering the impact which import controls can and probably will have on egg prices in Canada, will the minister, before the border closes, fulfil the undertaking he made in this House and appoint consumer representatives to the Farm Products Marketing Council, which obviously must advise the minister before such controls are established?


Eugene Whelan: Mr. Speaker, the appointments have been made. They will be announced in a news release later today. I could mention the names of the appointees in the House right now. They are Maryon Breckin, of the Consumers Association of Canada, George Home of the Canadian Labour Congress, and Gerry Pringle, who represents the business world.


Some hon. Members:: Oh, oh!


Mr. Mazankowski:: Finkle represents the Liberal party.


AIR TRANSPORT
Mr. Bob Kaplan (York Centre):: Mr. Speaker, I wish to direct a question to the Minister of Transport.
Would the minister say whether he is for or against the interest expressed by Air Canada concerning a STOL service based on Toronto Island?


Jean Marchand: Mr. Speaker, I think that before taking any decision concerning a new STOL network between two cities in Canada, we should complete the experience under way between Montreal and Ottawa. As soon as we have all these data, perhaps Ottawa and Toronto will be ready to use the STOL service.


EXTERNAL AFFAIRS
Mr. Andrew Brewin (Greenwood):: Mr. Speaker, my question is directed to the Secretary of State for External Affairs. As I understand the minister has been in South Korea negotiating with the government of that country the sale of a CANDU reactor, among other things, may I ask how those negotiations progressed and what safeguards the government of South Korea accepted as a prelude to any sale?


Allan Joseph MacEachen: Mr. Speaker, I was in South Korea and met members of the government but was not negotiating

the sale of a nuclear reactor to the government of South Korea. As I said I would the week before last, in the debate on nuclear matters, I raised with President Park the question of the statements attributed to him, to the effect that the Republic of Korea intended to opt for the nuclear weapons route. The president assured me that any such statements attributed to him were false, that the government of South Korea did not plan to develop the nuclear weapons option, and would not. He said, finally, that in his view such a development would be counterproductive to the security of the Republic of Korea.
I make this report because I indicated to hon. members during the debate that I would raise this matter with the president. As for safeguards, I believe that in the communique which was issued following the discussions with the foreign minister, it was made clear that the safeguards requirements of the Canadian government will be those which must be negotiated and concluded with that government.


PROPOSED SALE BY FRANCE TO SOUTH KOREA OF PLUTONIUM SEPARATOR PLANT-REQUEST FOR REPORT
Francis Andrew Brewin: Mr. Speaker, may I ask the minister a specific supplementary question? It has been reported that the French government or some authorities in France propose to sell South Korea a plutonium separator plant which can only be used to separate plutonium for the making of bombs. Did the minister question President Park about that and did he receive assurances as to whether such reports are factual or otherwise?


Allan Joseph MacEachen: Mr. Speaker, the president assured me that he had given no instruction whatsoever to his officials to commence study of or research for any particular nuclear weapons option.


AUDITOR GENERAL
Mr. G. W. Baldwin (Peace River):: Mr. Speaker, my question is for the President of the Treasury Board. Now that the opposition parties, with the aid of the report of the independent committee for the review of the office of the Auditor General, have finally shamed the government through the instrument of the budget into providing extra staff for the Auditor General, will the hon. gentleman indicate if that is to be done right away, and if, in relation to the appointment of the extra staff, the Auditor General will have the independence which has been asked for by this party, by the present and past Auditor General and by the committee.


Hon. Jean Chretien (President of the Treasury Board):: Mr. Speaker, I should think the hon. member would want to congratulate me for providing the Auditor General with more money at a time when I am cutting $1 billion from the spending of other departments.
July 2, 1975


Gerald William Baldwin: Please answer the question.


Joseph Jacques Jean Chrétien: I have not received any complaint from the House about the way we are to handle the new Auditor General's authority. He will be able to exercise it with the maximum freedom, within the scope of the present law.


AIRPORTS
Mr. J. R. Ellis (Hastings):: Mr. Speaker, my question to the Minister of Transport is supplementary to that asked a few moments ago by the hon. member for York Centre. Not entirely accepting the minister's comment on STOL transportation, I ask him to take whatever steps are necessary to make sure Toronto island airport is not closed until the experimental time is over.


Jean Marchand: Mr. Speaker, so far as it lies within my authority, I will do all I can to keep this airport in Toronto, because I think it will be useful in future.


HEALTH SERVICES
Mr. Heward Grafftey (Brome-Missisquoi):: Mr. Speaker, my question is for the Minister of National Health and Welfare. Some days ago, when answering a question of mine, he said that he was optimistic enough to feel that after negotiations with the provinces, ambulance and emergency services would be included under the federal-provincial medicare program. Can the minister assure the House that, although the Finance Minister said during the budget speech that the federal authority intends to serve notice on the provinces with regard to the federal funding of medicare, his optimism is not lessened and that ambulance and emergency services will be included under medicare?


Marc Lalonde: Mr. Speaker, if the hon. member would consider carefully the answer I have already given, I did not make any specific commitment as the one he mentions in his question. Respecting the second part of his question, I refer him to the Minister of Finance's statement. It is obvious that the provisions of the budget do not affect in any way the present negotiations. As far as the federal government is concerned, those negotiations should be followed, and I hope we will reach a happy settlement this fall, if possible, and later, if the provinces want to delay the signing of new agreements.
Oral Questions


William Heward Grafftey: A supplementary question, Mr. Speaker. Since the Minister of Finance indicated in the budget speech that he will serve notice on the provinces with regard to new funding arrangements, will the Minister of National Health and Welfare present the provinces with new and realistic cost-sharing proposals before the Minister of Finance sends out his notice?


Marc Lalonde: No, Mr. Speaker, we are now discussing the possibility of extending the coverage under the present legislation. Regarding a complete new form of tax sharing, I think some time will be necessary before the provinces and the federal government can develop one that is more likely to be agreed upon than the one presented last time.


FINANCE
Mr. Doug Roche (Edmonton-Strathcona):: Mr. Speaker, my question is for the Minister of Finance. Since it is now ten days since plans for cuts in government expenditures were announced in the budget, can the minister tell us whether the cuts in the External Affairs budget will include the CIDA budget of $933 million and, if not, is it the minister's intention that the CIDA budget should grow in what has become the normal pattern of escalation?


John Napier Turner: I have said that this matter will be dealt with either by my colleague, the President of the Treasury Board, or by the minister concerned.


TRANSPORT
Mr. Jack Murta (Lisgar):: Mr. Speaker, I should like to direct a question to the Minister of Transport. Can the minister confirm or deny persistent reports as to a pending increase in tolls on the St. Lawrence Seaway-Welland Canal system? Is the government contemplating an increase in these tolls and, if so, when might these increases be coming into effect?


Jean Marchand: This matter has not been discussed with the Transport Council, much less in cabinet, so it is a purely hypothetical one at the moment.

July 2, 1975
Oral Questions


EXTERNAL AFFAIRS
Mr. Claude-Artdre Lachance (Lafontaine-Rosemount):: Mr. Speaker, my question is supplementary to the question asked on Thursday, June 26, 1975, by the hon. member for Winnipeg South Centre to the Acting Secretary of State for External Affairs.
Since the House of Representatives of the United States Congress has approved the financing of two major projects, that is the Garrison diversion in North Dakota, and especially the Dickey Lincoln project in the State of Maine whose construction will flood more than 5,000 acres of arable land in Quebec, whose approval shows the failure of the marshmallow diplomacy between Canada and United States, is the Canadian government considering other means of action to constrain the American government to keep its commitment that it shall not do anything with regard to the projects which might cause prejudice to Canada?


Allan Joseph MacEachen: As was stated last week by the President of the Privy Council, the government of the United States, including the President himself, has given Canada categorical assurance that obligations under the appropriate treaty will be carried out. I accept this assurance that in this particular case they will be carried out by the government of the United States.


FINANCE
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the Acting Prime Minister. In his budget speech, the Minister of Finance announced that the government would be introducing legislation to increase the rate of returns on existing Government of Canada annuities. Can the Acting Prime Minister tell us whether legislation to this effect will be placed on the order paper before the summer recess or, if not, whether an announcement will be made as to the details of that legislation?


Hon. Mitchell Sharp (Acting Prime Minister):: It is not
quite clear whether separate legislation is required or whether it will be sufficient to have the changes covered in the next Appropriation Act. In any event, if legislation should not be required there will be an explanation before we rise.


THE CANADIAN ECONOMY
Mr. Peter Bawden (Calgary South):: Mr. Speaker, my question is for the Acting Prime Minister. In Alberta this weekend, the Minister of Labour, speaking to a small group of Liberals who got up for breakfast, said there appeared to be "lots of opportunity for further consultation with business and labour over the course of the next month or even the next year." Can the Acting Prime Minister clarify what the Minister of Labour was talking about? Has the government decided to resume the consensus talks in an effort to reach some form of voluntary restraint?


Mitchell William Sharp: The
hon. member will recall that when the Minister of Finance made his budget speech he said he thought the consultation process had been a very useful form of dialogue between the government and the various parts of the community and that the channels of communication should not be closed off.


COMMUNICATIONS
Roch La Salle: Mr. Speaker, I have a question for the minister responsible for communications.
Considering that during the weekend the Quebec premier said publicly that he was in favour of the position taken by his minister, Mr. L'Allier, Mr. Bourassa's statement representing very clearly I think the position of Quebec, is the minister prepared to put an end to the conflict between both governments until the next conference of responsible ministers?


Hon. Gerard Pelletier (Minister of Communications):: Mr. Speaker, I do not think the statement of the Quebec premier changes anything in the situation; it is a repetition, it is the fourth time, I think, he has made the same statement. As far as the conflict is concerned, I would point out to the hon. member that Quebec issued a licence concerning a territory already granted by the CRTC; so the federal government did not start the hostilities.


VETERANS AFFAIRS
Mr. Jack Marshall (Humber-St. George's-St. Barbe):: Mr. Speaker, I direct this question to the Minister of Veterans Affairs. Has the minister had an opportunity to consider the excellent recommendations of the Standing Committee on Veterans Affairs with respect to the Her-
July 2, 1975

mann Report? Has he presented it to cabinet for discussion, and, if so, when can we expect to see legislation giving effect to these recommendations?


Hon. Daniel J. MacDonald (Minister of Veterans Affairs):: The recommendations are at present being studied in my department for presentation to the cabinet. This will take some time. I shall certainly proceed as rapidly as possible.


AGRICULTURE
Mr. Bill Jarvis (Perth-Wilmot):: Mr. Speaker, I wish to direct a question to the Minister of Agriculture. Is the minister in a position today to report on the discussions which were held on Friday, June 20, in Ottawa regarding the issue which brought about the resignation of a member from the Ontario Egg Board, namely the legality of the penalty of one dollar a bird under the federal and provincial structure which, if implemented, could result in provincial boards obtaining funds from other sources to pay the penalty, thus becoming susceptible to law suits? Did the minister get a report from that group of lawyers and what was the nature of their opinion?


Eugene Whelan: If I got a
report I have not had time to see it as yet but I am told that strictly, as far as they were concerned, this is under provincial jurisdiction and would be handled in that fashion. Some provinces have changed their laws to comply with the marketing regulations they have set up for themselves and I understand that this is true, or will be true, with regard to the Province of Ontario.


William Herbert Jarvis: Has the minister considered seeking an opinion from his legal advisers in the federal government as to the legality of the payment of this particular penalty? If he has already done so, what was the opinion of the lawyers he consulted?


Eugene Whelan: I will consult the legal officers in my department and report to the hon. member.



ROUTINE PROCEEDINGS


Gerald William Baldwin: Mr. Speaker, I should like, with your permission, to ask the government House leader whether he can put on the record the government's intentions with respect to the legislative program between now and such date in the future when this House might be recessed.
Criminal Code


Mitchell William Sharp: Mr. Speaker, perhaps I could first of all list the bills we would like to see completed, or taken to various stages, before we recess.


John Patrick (Pat) Nowlan: This is known as parliamentary roulette.


Mitchell William Sharp: Bills C-8, C-2, C-57, C-50, C-53, C-63 and two bills which have not yet been introduced-an amendment to the Public Service Staff Relations Board Act which has been recommended by a standing committee, and one of the bills arising out of the budget, the Excise Tax bill. We would like all of these to be completed and given Royal Assent before we rise.


Some hon. Members:: Oh!


An hon. Member:: Tell us about the Christmas recess.


Mitchell William Sharp: The Unemployment Insurance Act amendments should be carried to completion of second reading.
Perhaps I might also indicate the order of priority. This evening we will call Bill C-8. If we happen to get through that today or in the extra hours tomorrow, we will go on with Bill C-50 and Bill C-63; but in any event, Bill C-8 will remain on the order paper until debate on it has concluded.


MISCELLANEOUS ESTIMATES
[Stage Direction]
Seventh report of Standing Committee on Miscellaneous Estimates, in both official languages-Mr. Leblanc (Laurier).
[Editor's Note: For text of above report, see today's Votes and Proceedings.]

Mr. C. Douglas (Bruce-Grey) moved: for leave to introduce Bill C-397, to amend the Criminal Code (wilful destruction of laid-up colours).


Some hon. Members:: Explain.


Crawford Douglas: Mr. Speaker, regimental colours and air force squadron standards still in use are well guarded on army and air force bases but "laid-up colours" are invariably displayed in public places. These colours, I believe, represent something very sacred, not only to those men and women who served under them but to all Canadians as part of our history. The purpose of this bill is to provide that it shall be an offence under the Criminal Code for any person wilfully to destroy or defile any laid-up colours in any public place in Canada.


[Stage Direction]
Motion agreed to, bill read the first time and ordered to be printed.
[Stage Direction]
July 2, 1975
Order Paper Questions

[Stage Direction]
On the order: Government Notices of Motions.
June 26, 1975-The President of the Privy Council:
That the Standing Committee on Indian Affairs and Northern Development be empowered to travel to Sarnia, Ontario and vicinity, from July 6th to 8th, 1975, for the purpose of studying economic development on local Indian reserves and that the necessary supporting staff do accompany the Committee.
Mr. Speaker:: Pursuant to section (2) of Standing Order 21, this notice of motion is transferred to and ordered for consideration under Government Orders at the next sitting of the House.


MOTION TO PERMIT COMMITTEE TO ADJOURN FROM PLACE TO PLACE DURING RECESS
[Stage Direction]
On the order: Government Notices of Motions.
June 26, 1975-The President of the Privy Council:
That the Standing Committee on Indian Affairs and Northern Development be empowered to adjourn from place to place in the eastern provinces and northern Canada during the coming recess in order to inquire into matters concerning development of the north and the affairs of native peoples and to view historic sites and parks and that the necessary supporting staff do accompany the committee.
Mr. Speaker:: Pursuant to section (2) of Standing Order 21, this notice of motion is transferred to and ordered for consideration under Government Orders at the next sitting of the House.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. John M. Reid (Parliamentary Secretary to President of the Privy Council):: Mr. Speaker, the following questions will be answered today: 1,232, 2,318, 2,331, 2,420, 2,499, 2,500, 2,501, 2,502, 2,546, 2,651, 2,820 and 2,832.
Mr. Speaker, if question No. 1,709 could be made an order for return, this return would be tabled immediately.
Would you be so kind as to call starred question No. 2,540?
I ask, Mr. Speaker, that the remaining questions be allowed to stand.


Mr. Cossitt: 1.	What are the names and job designations of any and all persons instructing any employees of the Department of Public Works or of the National Capital Commission that they were not to discuss construction of a swimming pool at 24 Sussex Drive with anyone including, specifically, members of the news media and Opposition Members of Parliament?
2.	For what reason were such instructions issued?

3.	Was this a direct attempt to withhold information to which both Parliament and the public are entitled and, if so, for what reason?


Right Hon. P. E. Trudeau (Prime Minister):: It is general practice throughout the public service that employees are not to discuss with outsiders matters coming within their knowledge in the course of their duties unless authorized to do so by their superior officers.


Mr. Cossitt: With reference to the answer to Question No. 1,797 which states in effect that the itinerary and mode of travel etc. by Mr. Michael Pitfield on a trip to the Mediterranean for a period of twenty-four days from August 16 to September 9, 1969 was chosen by the Prime Minister since he was assisting the Prime Minister, what was (a) the exact and detailed itinerary for each day involved including the location in which each day and night was spent (b) the names and owners of any ship travelled upon (c) the names of all persons present on any ship other than bona fide members of the crew?


Pierre Elliott Trudeau: Since the Prime Minister was then on holidays, the information sought is of a private nature. (See Beauchesne's Parliamentary Rules and Forms, fourth edition, citation 171(dd).)


Mr. Cossitt: With reference to the answer to Question No. 1,796 which stated in part that the purpose of Mr. Michael Pitfield's thirty-six day trip to Europe in 1968 was "to exchange views for use and advice to be tendered to a Minister or Ministers of the Crown", what is the identity of all Ministers to whom Mr. Pitfield tendered advice directly as a result of this trip?


Pierre Elliott Trudeau: Mainly to the Prime Minister and indirectly to all ministers since at the time Mr. Pitfield was Assistant Secretary to the Cabinet.


Mr. Forrestall: With reference to the answer to Question No. 1,256, does the Department of National Health and Welfare have any guidelines for regional distribution of funds, as is the case with the Secretary of State, respecting the allocation of funds for the International Women's Year activities and (a) if not, for what reason (b) if so (i) what are the regional breakdowns (ii) what is the amount estimated to be spent in the Halifax and Dartmouth metropolitan community?


Marc Lalonde: (a) No specific regional allocations have been set aside under the Department of National Health and Welfare's grants to voluntary organisations-International Women's Year Program. The program aims to have the maximum impact possible with the limited funds available. If strict regional allocations were to be enforced, some excellent national and regional projects could not be supported. Nonetheless, every possible effort is being made to ensure a fair distribution of grants across the country. In appraising applications which relate to the general objectives of the Department of National Health
July 2, 1975

and Welfare, on the basis of comparative merit, special consideration is given to projects whose long term impact will affect large numbers of citizens. Every attempt is also being made to award grants to groups and organizations representing a broad cross-section of Canadian society, (b) Not applicable.
Order Paper Questions


Mr. Caouette (Temiscamingue): 1.	For each fiscal year from 1965 to 1974, what was the value of the provincial bonds held by (a) the Bank of Canada (b) chartered banks?
2.	For the same years, what percentage of the total number of bonds was held by (a) the Bank of Canada (b) chartered banks?


Mr. Caouette (Temiscamingue): 1.	On December 31, 1965 to 1974 inclusive, what was the value of the Treasury bonds held by (a) the Bank of Canada (b) chartered banks?
2.	For the same years, what percentage of the total number of Treasury bonds was held by (a) the Bank of Canada (b) chartered banks?


John Napier Turner: Value of treasury bills held by Bank of Canada and the chartered banks at indicated dates and percentage of the total outstanding.
	Bank of Canada $ million per cent		Chartered Banks $ million per cer	
December 31				
1965	612	28	1,369	641966	412	19	1,567	721967	544	22	1,742	711968	459	16	2,145	761969	486	17	2,116	731970	630	17	2,714	751971	894	23	2,716	711972	940	23	2,984	721973	1,093	23	3,475	741974	1,615	29	3,757	67


John Napier Turner: Value of Provincial Bonds held by Bank of Canada and the chartered banks at indicated dates and percentage of the total outstanding.
Bank of Canada $ million per cent
Chartered Banks $ million per cent
December 31
1966
1967 1908
1970
1972
1974
338	3
280	2
315	2
349	2
351	2
449	2
567	2
492	2
469	2
471	1


Mr. Caouette (Temiscamingue): Question No. 2,502-Mr. Caouette (Temiscamingue):
1.	For each fiscal year from 1965 to 1974, what was the value of the municipal bonds held by (a) the Bank of Canada (b) chartered banks?
2.	For the same years, what percentage of the total number of bonds was held by (a) the Bank of Canada (b) chartered banks?
1.	For each fiscal year from 1965 to 1974, what was the value of the government bonds held by (a) the Bank of Canada (b) chartered banks?
2.	For the same years, what percentage of the total number of bonds was held by (a) the Bank of Canada (b) chartered banks?


John Napier Turner: Value of Government of Canada bonds held by Bank of Canada and the chartered banks at indicated dates and percentage of the total outstanding.


John Napier Turner: Value of Municipal Bonds held by Bank of Canada and the chartered banks at indicated dates and percentage of the total outstanding.
Bank	of Canada	Cbartered Banks	$ million	per cent	$ million	per cent	December 31	December 311965	2,860	23	2,355	19	19651966	3,061	24	2,324	IS	19661967	3,263	25	2,888	23	19671968	3,483	24	3,429	24	19681969	3,627	25	2,977	21	19691970	3,665	25	3,889	26	19701971	3,972	27	4,608	32	19711972	4,512	31	4,148	28	19721973	4,931	34	3,816	27	19731974	5,423	36	4,364	20	1974Bank of Canada	Chartered Banks
$ million per cent $ million per cent
-	-	338	6-	327	6-	331	5-	345	5-	348	5-	357	5-	451	6474	6-	482	6-	-	462	5
July 2, 1975
Order Paper Questions


Mr. Stanbury: Does the government consider appropriate, or is it considering increasing, the current 6 per cent interest rate on income tax and refunds due and payable?


Mr. Jack Cullen (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, in the light of current conditions, the government does consider the interest rate of 6 per cent to be appropriate. It should be noted that this figure was raised from 3 per cent in April of 1974. The government will, however, continue to monitor the situation in the light of interest rates generally to determine whether changed conditions suggest the need for a change in the interest rates provided for in the income tax regulations.


Mr. Lambert (Bellechasse): 1.	How many loans were granted by the Industrial Development Bank during the fiscal year 1974-75 (a) in Canada (b) in each province (c) what was the amount for each province?
2.	For the fiscal year 1973-74, how many loans were granted and what was the total amount of such loans for each province?


John Napier Turner: Amount
No. i	of Loans	(*000)1973	1974	1973	1974*Total Canada	7,859	9,712	1344,798	5470,021Newfoundland	197	245	6,993	8,121Nova Scotia	260	262	7,427	8,289Prince Edward Island	83	77	2,551	2,453New Brunswick	224	284	9,059	12,959Quebec	1,383	1,652	71,799	85,701Ontario	1,789	2,391	75,336	110,850Manitoba	179	248	8,404	12,941Saskatchewan	178	246	7,134	10,736Alberta	646	1,067	26,458	47,724British Columbia	2,835	3,159	124,332	165,713North West Territories	38	41	2,570	1,783Yukon	47	40	2,735	2,751
Data is published only for IDB fiscal years ending September 30th,


Mr. Clark (Rocky Mountain): How many and which Deputy Minister holding office as of May 31, 1975 had (a) served in the Department of External Affairs (b) worked for a consecutive period of at least one year (i) in private business (ii) with a provincial government (iii) in an administrative or teaching capacity with a university or other institution outside government?


Pierre Elliott Trudeau: (a) Seven, as follows: Deputy Minister, Communications; Deputy Minister, Environment; Under-Secretary of State for External Affairs; Deputy Minister, Indian Affairs and

Northern Development; Deputy Minister, Industry, Trade and Commerce; Deputy Minister, Manpower and Immigration; Secretary to the Cabinet (Federal-Provincial Relations). (b) (i) Nine, as follows: Deputy Minister, Finance; Superintendent of Insurance; Deputy Minister, Justice; Deputy Minister, Labour; Deputy Minister, National Health and Welfare; Deputy Minister, National Revenue; Deputy Postmaster General; Clerk of the Privy Council and Secretary to the Cabinet; Secretary of State for Science and Technology, (ii) Four, as follows: Deputy Minister, Finance; Deputy Minister, Labour; Deputy Minister, National Health and Welfare; Secretary of State for Urban Affairs, (iii) Eight, as follows: Deputy Minister, Communications; Deputy Minister, Consumer and Corporate Affairs; Deputy Minister, Indian Affairs and Northern Development; Chief, Statistician of Canada; Deputy Minister, Manpower and Immigration; Deputy Minister, National Revenue; Deputy Minister, Public Works; Secretary of State for Science and Technology.
Note: Deputy Minister has been defined as those deputy heads of departments as listed in Schedule "A" of the Financial Administration Act.


Mr. Clark (Rocky Mountain): 1.	As of May 15, 1975, how many persons have been hired (a) by the Public Service Commission (b) under contract by the Privy Council Office for duties relating primarily to implementation and administration of (i) Bill C-3, An Act to amend the British North America Acts, 1867 to 1975 (ii) Bill C-24, An Act to amend the Salaries Act?
2.	In each case, what was the date of the original employment or commencement of contract?


Pierre Elliott Trudeau: 1. Nil.
2. Not applicable.


Mr. MacKay: 1.	Is Jacob Austin devoting his entire time and energies to his position as Principal Secretary to the Prime Minister?
2.	Can the Prime Minister indicate categorically that Jacob Austin has no interests at present, or designed to accrue in the future, in any banks, chartered or otherwise, which are in existence or in the process of being formed, nor airlines, nor any other business interests, details of which are not public knowledge?
3.	Did Mr. Jacob Austin correspond with the Soviet Ambassador to Canada relative to certain mining interests in the north wherein Soviet technology was to be utilized for the purpose of exploiting Canadian minerals and, if so, was this done with the knowledge of the government?
4.	Did Mr. Austin brief the proper Canadian government authorities and obtain their approval before entering into this type of correspondence with the Soviet Ambassador?
5.	If he did consult with various government authorities, who were these officials and what was their response?


Pierre Elliott Trudeau: 1. Mr. Austin is a fully competent and assiduous member of the Prime Minister's Office.
2. Mr. Austin advises he has no such interests.
July 2, 1975

3. No such correspondence has taken place while Mr. Austin has been an employee of the government of Canada.
4 and 5. Not applicable.



QUESTION PASSED AS ORDER FOR RETURN


Mr. Jones: 1.	Have any studies been made as to the comparative costs of operation of CBC and other networks?
2.	What are the total costs for CBC for each year 1966 to 1974?
3.	What regulations or controls are exercised over CBC and other networks?
4.	Who has jurisdiction over the types of programmes shown on CBC television?
5.	Has any consideration been given to establishing some sort of regulatory body to consider, classify and rate various programmes?
6.	For what reason have programmes of violence, exploitation of sex and the like continued to be shown on various television networks?
7.	How many complaints have been received by Members of the Cabinet and CBC with respect to programmes in the past six months?
Return tabled.


Mr. O'Sullivan:: Mr. Speaker, on a point of order; for over four months now we have been waiting for answers to starred questions 1,738 and 1,739. Since the government House leader is here, I should like to bring this serious situation to his personal attention. I express the hope that the minister will personally see to it that the various government departments come up with the information, certainly before the House plans to rise, so that we do not have to bring up the matter on the adjournment debate.


Mr. Jones:: Mr. Speaker, on a point of order; on February 3 of this year, almost five months ago now, I put a question on the order paper, No. 1,455, which occupies one word more than three lines. I wanted to know how much money had been spent by the government on cancer research, heart research and medical research and I have not yet had an answer. It is both important and essential that this question be answered, and I should like to ask the government House leader or his parliamentary secretary why it has not been answered.



MOTIONS FOR PAPERS

John Mercer Reid: Mr. Speaker, notice of motion for the production of papers No. 49 is acceptable to the government, subject to the usual reservations concerning confidential documents and to the authorization of the government authorities concerned.
Would you be so kind as to call notice of motion for the production of papers No. 45.
The Budget-Mr. Coates
I ask, Mr. Speaker, that the other notices of motions be allowed to stand.
PROPOSED TRANSFER OF WESTMINSTER HOSPITAL Motion No. 49-Mr. Marshall:
That an humble Address be presented to His Excellency praying that he will cause to be laid before this House copies of all correspondence between the government and (a) other levels of government (b) veterans organizations concerning the proposed transfer of Westminster Hospital in London, Ontario.


Mr. Speaker:: Subject to the reserves and conditions mentioned by the parliamentary secretary, does the House agree that notice of motion No. 49 be deemed to be passed as an order for return?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

[Stage Direction]
Motion No. 45-Mr. Dinsdale:
That an humble Address be presented to His Excellency praying that he will cause to be laid before this House a copy of the 1962 agreement between the Government of Manitoba and the Government of Canada with respect to the Nelson River Power Project in the Province of Manitoba.
John Mercer Reid: Mr. Speaker, there is no 1962 agreement between the governments of Canada and Manitoba relating to the Nelson River power project in Manitoba. However, a 1963 agreement between the governments of Canada and Manitoba relating to surveys and studies of the Nelson River power potential was tabled on December 21, 1963, Sessional Paper No. 276. I would, therefore, respectfully request the hon. member to withdraw his motion.


Walter Gilbert Dinsdale: Agreed.


Mr. Speaker:: Agreed and withdrawn.
Motion withdrawn and order discharged.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Friday, June 30, consideration of the motion of Mr. Turner (Ottawa-Carleton) that this House approves in general the budgetary policy of the government; and the amendment thereto of Mr. Stevens (p. 7063).
[Stage Direction]
July 2, 1975
The Budget-Mr. Coates
Mr. Robert C. Coates (Cumberland-Colchester North):: Mr. Speaker, before commencing discussion of the budget proposals put forward by the Minister of Finance (Mr. Turner) I should like to take a moment specifically to refer to the events in relation to our 108th anniversary which took place on Parliament Hill yesterday, and which as far as I know was still Dominion Day regardless of how many people who tried to insist that it was a day with a different name. My purpose in making mention of what transpired on Parliament Hill yesterday is not from the point of view of arguing over the name of the day so much as to offer to all government officials who had something to do with making it the event that it was my personal compliments.
May I also say to members of all parties in the House that if they want to be inspired, if they really want to appreciate what Canada is all about, to see what makes Canada strong when sometimes we think it is weak, all they needed do was to observe the group of individuals who last night covered every patch of grass on Parliament Hill to join together, regardless of colour or creed, to enjoy the culture of this nation and the magnificent fireworks display. That will be indelibly imprinted in my mind as one of the significant things that brings us all together and makes us proud of this great nation of ours, giving us the assurance that it will continue to be a great nation and grow to be an even greater nation as the years pass by.


Some hon. Members:: Hear, hear!


Robert Carman Coates: Having said that, I should like now to make some specific comments about the budget or the non-budget produced by the Minister of Finance which we are now debating and which will prove to be very meek in many ways. By far the most significant aspect of this debate has been the lack of support indicated in speeches delivered by members of the minister's own party. That much has been clearly shown already. While those speeches contain strong objections to the budgetary proposals, or the lack of them, when the votes are recorded those who have spoken against these proposals will vote for the package that has been presented.
Instead of attacking the double problem of inflation and unemployment, the minister has stoked the fires and there is less likelihood now that either will abate than before the budget was presented. This budget has been described as the worst in memory. Words such as, "heartless" and "cruel" fit the bill, but do not go nearly far enough. This budget puts us firmly on the road to self-destruction from an economic point of view. It is not that we were not on that road before the budget, it is just that the minister has made certain there is now no way to detour.
I should like now to pay special tribute to the member for York-Simcoe (Mr. Stevens), particularly for his dedication, determination and the work he put in trying to come forward with alternate proposals to those of the budget.


An hon. Member:: Unworkable proposals.


Robert Carman Coates: How would anybody over there know whether these proposals are unworkable when they are

members of a government which has produced sweet bugger-


Some hon. Members:: Oh, oh!


An hon. Member:: Only the Prime Minister (Mr. Trudeau) can use that kind of language.


Some hon. Members:: Hear, hear!


Robert Carman Coates: I guess "nothing" is the proper parliamentary word. The hon. member has spent a great deal of time and effort in bringing forward alternate proposals. He has just a great deal of time and effort, first of all, in determining the symptoms of the problem, and secondly in producing cures for those symptoms. I do not see how hon. members opposite can suggest they are unworkable when they belong to a government which has brought forward a 10-cent tax on gasoline that will place the burden directly on the backs of the workingmen and poor in this country, and just about nowhere else.
This government has put forward a rebate scheme that is so complicated we will probably have to double the size of our public service in order to administer it. When it is administered we will probably find that we will not realize enough from the 10-cent tax on gasoline to pay the salaries of the extra civil servants who will form part of this new scheme the government has produced.
It is the members of that government party who are telling us that our proposals are not workable, but I suggest that our proposals are realistic, practical and based on commonsense. Members of this government do not know what will work and they have not known for a long, long time.


Some hon. Members:: Hear, hear!


Robert Carman Coates: We have been witnessing a breakdown in the collective bargaining system of this nation. Wage demands and strikes have had a material and disastrous effect on our external trade. We are no longer a dependable nation when it comes to meeting international trading commitments. In my hometown of Amherst, Robb Engineering, a firm that has been in continuous operation for 125 years, has faced its first strike. It is a sign of the times which have been created by this government to a far greater degree than by either management or labour.
At the same time, we cannot allow ourselves to become the captives of big labour in this nation. One only has to either visit and see or read about the terrible problems in the United Kingdom to realize what happens when big labour becomes more powerful than the parliament of a nation. This could happen here and many will contend it already has. Instead of producing a budget that would have given the ordinary union member some reason to ride heard on the union executive, we have a budget that guarantees an increase in the cost of living and heavy extra burdens for the workingman from a transportation point of view.
Instead of more realistic demands, there will be a sharp increase in the percentage increases demanded in labour contracts, as well as demands for shorter and shorter contracts, thus creating still greater instability in the market place. No doubt we can anticipate more irresponsi-
July 2, 1975

bility of the kind spouted by Joe Davidson of the Union of Postal Workers, who stated on national television that the public could go to hell. For the head of a union which represents employees who serve the public, and are paid by the public, to make statements of this kind, that border on sedition and public mischief, only goes to confirm the degree of irresponsibility which has become a part of the labour movement in this nation today. It must be stopped, but cannot be as long as we have to accept budgets of this kind from the government of the day. It has not always been that way and it was not that way in 1963 when this government assumed office. It might be of value to reflect on the kind of economy that was inherited from the Diefenbaker administration at that time. This is a legacy well worth recalling.
This is what was being said about the state of the economy in 1962 with a Progressive Conservative government in Ottawa. An article in the Canadian Business Magazine for September, 1962 reads:
-a 12 nation comparison of retail price increases over the 12 months shows that Canada has been the most successful in keeping down the cost of living. The Canadian increase was just under 1 per cent.
In Business Week for December of the same year we find this statement:
Canada chalked up the highest growth rate of any Atlantic Community country-
The Canadian Imperial Bank of Commerce reported in December 1962:
One of the main sources of strength as this year progressed has been the substantial rise in the volume of exports.
Newsweek reported at about the same time:
Worldwide industrial expansion is 7 per cent over last year with the U.S. and Canada registering the top gain of 10 per cent.
It is difficult to believe that there ever were those days in Canada, because in the 12 years since this government took office it has obliterated any concept in the minds of Canadians that our economy can be managed in an effective, efficient and progressive way as was the case in the days when the right hon. member for Prince Albert (Mr. Diefenbaker) was prime minister of this country.


Some hon. Members:: Hear, hear!


Robert Carman Coates: I put these facts on the record so that Canadians, both young and old, will not be deceived by this government into thinking that chaos and catastrophe were always the hallmarks of federal government administrations. The right hon. member for Prince Albert and his administration produced policies that were much superior to anything this administration has come close to in its 12 years in office. Indeed, it is a sorry spectacle that we witness today.
It was interesting to note that the Parliamentary Secretary to the Minister of Energy, Mines and Resources (Mr. Foster) in a recent speech at Murray Bay, Quebec, told his audience of the value of interconnecting grids so that power might be moved from one part of this nation to the other in a far more economic manner than at this moment in time. He said:
Greater coordination of electric utility expansion plans on a regional basis must be given attention. The economic utilization of large-scale hydro projects, the possible development of tidal energy, the incorpora-
The Budget-Mr. Coates
tion of large nuclear units-they all lead to increasing requirements for exploiting the benefits of regional interconnections.
It is good to hear those words being spoken at this time, but the facts are that the right hon. member for Prince Albert called for the establishment of a national power grid in 1961, and the hon. member for Qu'Appelle-Moose Mountain (Mr. Hamilton), as the Minister of Northern Affairs at that time, embarked upon negotiations that would have made it a reality had there not been a change of government in 1963. This program was abandoned when the new Liberal government took office and only now, in the midst of crisis, do we find the common goal of national development being pursued. We could say better late than never, but it is damning evidence of a lack of national application by a government that is so embarrassed by continuing crises that it can find little or no time to pursue the kind of national programs that made this nation what it is today. Indeed, it is probably the only reason we have been able to survive the type of abortive schemes which are the ingredients of this budget.
If the Pearson administration had carried through on the groundwork of the Diefenbaker administration, we would have a national power grid in this nation today. Once we have such a grid system, the nation will be able to fully utilize the potential power pool of Atlantic Canada. There is the tremendous power potential of Churchill Falls, the coal fields of Cape Breton, Pictou and Cumberland counties in Nova Scotia and the Minto area of New Brunswick. We have the nuclear power potential that will be available from New Brunswick and, most of all, the tidal power potential of Minas Basin, Cumberland Basin and Shepody Bay.
I have not mentioned the possibility of offshore oil finds off the coast of Nova Scotia, Newfoundland or Labrador, but I am saying that I believe a national power grid in the rest of Canada could tap into a tremendous potential energy resources on the east coast of this nation for the benefit of the whole of this nation. It is absolutely imperative, now the government has finally decided to move in respect of the establishment of a national power grid, that it move as quickly as possible to see that arrangements are made and transmission lines are put in place so that the power can flow in this nation either from east to west or from west to east wherever power is needed at a specific time.
There may have been some reason to believe that tidal power could not compete with the economics of oil at $2 or $3 per barrel, but there is absolutely no justification for further studies to determine the economic feasibility of this energy resource with oil at $12 a barrel or more. Indeed, rather than spending a further $3 million for studies, we should be spending the money to determine the best engineering method and calling tenders to have the construction begin. If France could produce a pilot project that has proven economic, indeed so economic that it now plans to construct a project 15 times the size of LaRance, and with tides that are not nearly as high as those in the Bay of Fundy, surely it is common and practical sense to get on with the job.

The Budget-Mr. Coates
Indeed, we should be initiating discussions with the government of the United States so that we could co-operate in producing the engineering technology that would allow for the production of tidal energy at both Passamaq-uoddy Bay and in the Bay of Fundy. We should be working also with the United States to see if we could help it produce much needed power from the Dickey-Lincoln complex in the State of Maine. Rather than emphasizing our independence, which might please a small clique in this nation mostly in the Toronto area of Ontario, we should be striving to help each other find ways to eliminate the oil blackmail that has become so destructive to most of the economies of the nations of this world which have proven to be friends of Canada through thick and thin.
When speaking of international blackmail, may I support the position of my party against the possible approval of delegates of the PLO attending a United Nations conference in Toronto. Premier William Davis has indicated his strong opposition against delegates from the PLO attending this conference. While I can appreciate that the Palestine refugees should have a voice, I do not believe it should be the voice of a terrorist organization. Indeed, I had hoped the PLO would have taken the sound advice of President Sadat of Egypt and have initiated the establishment of a provisional government that would not have associated with it the stigma of the PLO, and the international gangsterism that has come with the highjackings and murders all over the world. Surely, this meeting which is concerned justice and law reform has little in common with the past activities of the PLO.
At the same time, I want to urge the government to use some common sense in its dealings with the government of Taiwan. Anyone who has visited that island nation could come away with only admiration and appreciation. It is a democracy in every sense of the word. Its people are industrious and determined to build a nation on the teachings of Dr. Sun Yat Sen. Its achievements in less than 30 years have to be one of the phenomena of the twentieth century. The people there are realistic and appreciate that Canada cannot follow a two-China policy in the light of world events. But they do not seek diplomatic relations, only a relationship similar to that provided by the United Kingdom, Australia and New Zealand, or, if you wish to get closer to home, similar to that provided by Japan. Surely, the Canadian government and the Canadian people owe nothing to communism. Our country has been populated by people who have escaped from communism. Are we to be frightened by some imaginary action of the Maoists? It was not too long ago that we had to feed their starving people with our wheat. That does not mean they should be dictating our foreign policy, especially with people who were our friends during World War II. It would be to our mutual advantage to have trading offices established in our two nations and this should happen at the earliest possible moment. Rather than racing around trying to establish diplomatic relations with new communist regimes, we should be trying to work out a satisfactory relationship with old friends who believe in democracy and freedom.
I should like to take a moment or two to talk about bilingualism. It seemed passing strange to me to hear the hon. member for Laprairie (Mr. Watson) on Friday after-

July 2, 1975
noon express his concern about the money being expended by the government to send federal civil servants and their families from Ottawa to other places such as Quebec City, Switzerland, France or somewhere else. There have been many junkets of different kinds, if I may call them that, so that people might take courses in bilingualism. As I say, I found it passing strange to hear that comment from a Liberal member of parliament because not too long ago if someone in this House were critical on that point he would have been labelled either a bigot or a racist. He would have been condemned for being opposed to bilingualism.
It was also passing strange to hear the Commissioner of Official Languages recommend the use of the school systems of this nation to promote bilingualism. This comes very close to what the hon. member for Moncton (Mr. Jones) has been saying for a long time. He has been saying that the best way to promote bilingualism in this nation is through the school systems of the nation. It is good to hear the Commissioner of Official Languages state that we must use our school systems in order to work out the best possible method to promote bilingualism and to make Canadians in this nation comfortable in either official language.
I say the government must come clean with the Canadian people so far as the cost of bilingualism is concerned. It must tell the Canadian people which of the programs is working and which is not working. The government must seek advice from members of parliament of all political parties on how they believe bilingualism can best be implemented in this country-in a way with which everyone will agree and with which they will feel comfortable. I find that one of the difficulties insofar as the developing of bilingualism in Canada is concerned is the fact that there are not sufficient satisfactory French teachers in English-speaking Canada to teach our young people in our schools who really want to learn a second language.
We must convince the government that the French language should be taught from grade one forward, rather than as is the case in Nova Scotia from grade seven forward. I faced this problem when my children were very young. There was a French-speaking teacher who had some spare time and wanted to make some extra money. I put my daughter and son in her classes before they were even ready to go to school. She taught them the rudiments of that language. I can say without hesitation that both my son and daughter, unlike myself, have been very successful with the French language in our school system because of that early education.
If this government wants to convince people that bilingualism is important to all Canadians, it should start with the young people of this country. They are the ones most enthusiastic about it. A person half way through his career in the public service of Canada, past the age where it is easy to learn a second language, should not have his career jeopardized unless he tries to learn a second language. Even if he tries, he will not succeed. If he does not succeed, he will be impeded. Rather than bother that person, we should start with the youth of our nation.
The province of Quebec has a special responsibility. The teachers in that province should be encouraged to fan out
July 2, 1975

across this nation into the high schools and elementary schools to assist in the teaching of the French language. In that way, everyone will have a better grounding in the language and, therefore, they will feel much more comfortable about it. Once people feel comfortable about bilingualism, the problem will disappear. However, it will not disappear as long as this government is not willing to be honest with Canadians about the cost of the program. It will not be a success as long as there are clandestine programs the government refuses to tell us about. Nor will it be a success if people think their jobs will be jeopardized or if they think the government is trying to shove the language down their throats. Once we move into our school systems and do the work properly, we can look forward to an acceptance of a bilingual nation amongst Canadians, regardless of their background or their place of residence. That is the only way it will come about.
In conclusion, I want to make a few comments about the terrible situation in our penitentiaries. The answer which the Leader of the Opposition (Mr. Stanfield) secured from the Solicitor General (Mr. Allmand) today indicates better than anything else why these dedicated men and women who work in the Canadian penitentiary services are on strike today. The Solicitor General admitted to the House that the bill that was passed was the best he could secure. He said it as though the bill were some special bill of his. It was a bill of the parliament of Canada, not the Solicitor General. It was presented to the government by members of this House to implement. As was indicated, the bill was to the effect that in capital murder cases, the death penalty should apply.
I do not think there is a Canadian in this nation who would object to a sentence being commuted if a jury, in a capital murder case, recommended mercy. However, wholesale commutation of death sentences, regardless of the law, only produces other forms of lawlessness such as penitentiary employees assuming the right to take a day off work because there is no way they can get through to the Solicitor General to convince him that their personal safety should be considered. These employees do not feel they have any safety. Surely, there is ample evidence to indicate that there is not sufficient protection for them in our penitentiaries.
The Solicitor General is supposed to be responsible for penitentiary employees and the RCM Police. By adopting the stand he has, I do not see how he can expect any support or trust from the people he is supposed to represent and for whom he is supposed to speak. He does not speak for them. That is the sad fact of the matter. The sooner the Solicitor General leaves that portfolio, the better off this country will be from the point of view of law and order. As far as I am concerned, that could not happen too soon.


Joseph Jacques Jean Chrétien: Madam Speaker, I am very glad to be able to participate in this debate on the budget. First, let me congratulate my colleague, the Minister of Finance (Mr. Turner), for another job well done.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!
The Budget-Mr. Chretien


Joseph Jacques Jean Chrétien: It is never easy to be Minister of Finance and, in a time of serious economic upheaval, the task is particularly difficult. We, therefore, are especially fortunate as Canadians to receive the economic leadership from a strong and courageous minister.


Some hon. Members:: Hear, hear!


Joseph Jacques Jean Chrétien: I want to talk today about the reduction of about $1 billion in planned expenditures of the government in the present fiscal year. I have been surprised to hear opposition members and some members of the press describe these reductions as cosmetic or tokenism, and at the same time call for new expenditures. I can assure hon. members that there is no one minister, province or sector of our society which will view the reductions as tokenism or cosmetic. They know that it is very real. Unlike some Tory members, I believe that $1 billion is a lot of money.
In a time of inflationary pressure, the government has decided to set an example of restraint. It is doing so by cutting back on its planned expenditures. To cut back the rate of growth, some planned expenditures must be cancelled. These cutbacks are not inconsistent with some growth. This is a very significant and important aspect of the economic policy of the government.
Let me describe the situation that led to the stringent measures the government has taken. At the time of tabling the main estimates for this fiscal year, we showed in the booklet, "How Your Tax Dollar is Spent" that we expected to spend a grand total of $35.4 billion for budgetary expenditures, loans, investments and advances and old age security. In that total, we made provision for about $1.2 billion in supplementary estimates. Those figures were based on the November budget. Hon. members may recall I have said on a number of occasions that it was my intention to hold the growth of expenditures to 15 or 16 per cent over those of last year. That total of $35.4 billion was 15.4 per cent higher than the level of expenditures forecast for last year at the time of the November budget. In the previous year, the percentage increase year over year was 25 per cent. However, following the main estimates some unexpected expenditure demands arose, mainly because of inflationary pressures and because of circumstances beyond the control of the federal government.
We are now expecting these overruns in the following statutory programs: public debt charges, $200 million; fiscal transfers to the provinces, $190 million; hospital insurance payments to the provinces, another $225 million. We are also expecting that the payments made to subsidize consumer-prices for petroleum products will be $275 million more than allowed for. All these together total about $900 million more than expected in November when we established the expenditure ceiling of $35.4 billion.
At the same time we saw the necessity to undertake special expenditures to create jobs and to increase the supply of housing. The budget speech identified an amount of $275 million for these purposes this year. The cost overruns, the special employment expenditures and the extra housing expenditures total $1,175 billion, clearly enough to destroy any expectation of holding the growth in expenditures within a 15 per cent to 16 per cent limit,

July 2, 1975
The Budget-Mr. Chretien
unless drastic steps were taken to cut other planned outlays.
With this in mind, I looked at what we could cut out of the main estimates and what new expenditure decisions made since the main estimates could be reversed. Later, I will describe the expenditure reductions we did make in some detail. In summary, we first cut about $380 million from budgetary expenditures in the main estimates and about $220 million from loans approved in the main estimates. Second, we reversed about $400 million in expenditure decisions not reflected in the main estimates, some of which have already been announced, and some of which have not. In the end, we have a revised forecast of total expenditures of about $35.6 billion for 1975-76 for budgetary and non-budgetary items and for old age security. If I compare this $35.6 billion with the actual expenditures for 1974-75, the percentage increase year over year is very much less than the 16 per cent I have set as a target. In reality, it is closer to 13 per cent.
In this new forecast for 1975-76, because of the offsetting expenditure reductions, I have been able to accommodate the cost overruns and the special employment and housing measures which together total $1,175 billion. Finally, I still have a small reserve to meet as yet unknown new expenditure requirements which may be expected to arise. As President of the Treasury Board, it was my job to decide what cuts in expenditures could and should be made. The significance of these cuts must be judged in terms of the freedom of manoeuvre available to the government, that is, the degree of flexibility in the expenditure budget. The significance of the reduction must also be judged against the degree of restraint on expenditure growth which had already been applied in reaching the 1975-76 total.
Here again, I can assure hon. members that this has required very tough decisions for my colleagues and me. Indeed, treasury board presidents are as unlikely to win popularity contests as ministers of finance.

I would first refer to the flexibility, size, nature and make-up of the bulk of expenditures that were reduced. Off hand, it looks substantial at $35.6 billion, including old age security. But on closer examination, one realizes the volume that can be reduced is much smaller. That $35.6 billion figure includes, among others: $4 billion for old age security and guaranteed income supplement; $14 billion for other statutory expenditures as family allowances, transfer payments to provinces, health insurance and hospital insurance; $3 billion for various expenditures under commitments or fixed contracts, as subsidies to municipalities in lieu of taxes, and manpower training; $3 billion for the support of programs where the federal government is the main or sole source of help, from compensation payments for oil products to various research subsidies; and $2.5 billion for the defence program where restrictions have been applied over the last three years. Therefore, there is a total of over $25 billion of expenditures, concerning which the government has little or no leeway.
The remaining $10.1 billion leaves scarcely more possibilities. Crown corporations for instance account for $4 billion in the form of capital loans or deficit payments. Departmental regular equipment programs represent somewhere around $1 billion. So we have only about $5.1

billion left for all government services, including the Post Office, airports, federal police services, tax collection, prisons, food inspection and many subsidy programs for a large number of organizations.
Furthermore, it was only after an examination of the economic situation at the beginning of the current fiscal year that cutbacks in expenditures were decided. Many contracts had already been awarded and a great many operations were too advanced to be stopped, which further complicated the situation.
The scope of a cutback of $1 billion can also be assessed by examining the nature of the growth of public expenditures in recent years both at the federal and provincial levels. To illustrate what I mean I will take the changes that occurred between 1969 and 1974 and use the national accounts since they allow comparisons that are now needed.
In 1969 all governments in Canada spent 34.1 per cent of the gross national product. In 1974, that percentage went up to 39.1 per cent, a difference of five points. That figure includes all public expenditures, whether direct or indirect or in the forms of transfers to individuals. Family allowances and old age security are two significant examples. Apart from transfers to individuals and other governments we see that from 1969 to 1974 the portion of the gross national product spent by the federal government went from 9 per cent to 9.9 per cent, that of provincial governments going from 6 per cent to 8.3 per cent during the same period.
I want to add, Madam Speaker, that without the implementation of the oil product compensation payments program in 1974 the percentage of the federal government that year would have been about the same as in 1969. The difference is, as you are very well aware, that last year we went into a very expensive subsidy program for oil prices to counter the effect of the sharp increase that resulted in foreign oil producing countries raising oil prices fourfold. In fact, in terms of goods and services, and capital only, that is for salaries, materials and supplies as well as capital programs of all its departments the federal government spent 5.9 per cent of the gross national product in 1969 and 5.9 per cent in 1974. So, in terms of percentage of the gross national product, there was no change.
On the other hand, Madam Speaker, provincial governments increased the cost of their operations by about one third in real terms over the same period. Their expenditures increased from 5 per cent in 1969 to 6.7 per cent in 1974. I stress these figures to show how the increase in federal administration expenditures has been checked. With regard to reducing our expenditures by $1 billion in 1975-76, we therefore find ourselves on a tightrope.
In the context of compulsory expenditures in most cases, and almost zero increase in reducible costs, I found $1 billion to cut back. Certain commitments had to be cancelled, others postponed till a later date. Some capital expenditures also had to be postponed, important investments deferred, subsidies reduced, human resources foreseen for the civil service put off, and defence expenditures further restricted.
In short, the maximum impact of decreases had to be diluted by spreading it over all fields of federal responsi-
July 2, 1975

bility. Needless to say, no effort was spared to minimize the inconveniences to the public over the short and long terms. But it would be impossible to deprive the departments and other bodies from as large a share of their resources without it affecting their production.
The Minister of Finance, in his speech on budget night, spoke of the reductions under the heading of capital grants and contributions, programs and loans to Crown corporations. I will give you some specific illustrations of the major reductions, although it is not possible to be complete since some ministers are still working out a way of absorbing the effect of the amounts they were asked to find.
The major capital reductions will be as follows: the Department of the Environment: about $12 million, including $10 million of the allocation provided for small craft harbours; Indian Affairs and Northern Development: about $12 million affecting the Indian programs, the Mackenzie highway and the parks; National Defence and Public Works; about $10 million and $13 million respectively with the details of the way the reductions are to be handled yet to be worked out by the departments concerned; the Solicitor General: about $8 million affecting the construction of penal institutions; Transport; almost $35 million which is expected to affect icebreakers, the Cornwall Training Institute, aircraft procurement, airport construction and other activities.
In the grants and contributions category, there are a great many small items which I will not go into but I will mention a few major reductions: Canadian International Development Agency: a reduction of $30 million, in the previously approved cash disbursements. This reduction relates in part to a downward adjustment to correspond with our slower-than-expected rate of growth in the gross national product to which our aid program has a planned percentage relationship; Industry. Trade and Commerce: about $23 million affecting grants to industry and the subsidization of grain sales; Secretary of State; about $9 million, including $4 million for special development projects in the field of bilingualism.


Mr. Paproski:: What about Information Canada?


Joseph Jacques Jean Chrétien: Transport: About $12 million for railway relocation and grade crossings.
The program reductions are also of a varied kind, mainly relatively small amounts, covering many departments. Some of the large amounts are: Environment: about $13 million involving delay in the west coast salmon enhancement program, in the development of pollution abatement technology, in experiments in fish-farming and in other activities; Industry, Trade and Commerce: about $36 million which had been allocated for a grain storage program yet to be developed; Manpower and Immigration: about $9 million in the more optional expenditures under the manpower training program; Transport: $13 million, the details yet to be determined.
There are some reductions which cross the category lines I have been using and which I have not included in
The Budget-Mr. Chretien
the figures so far-that is, the categories of capital grants and contributions and programs. For instance, the Minister of National Health and Welfare (Mr. Lalonde) has been asked to find $50 million in reductions from his areas of responsibility and the Minister of State for Urban Affairs (Mr. Danson) to find $5 million in reductions to the planned expenditures of his department and about $18 million in those of Central Mortgage and Housing Corporation.


Steve Eugene Paproski: How about getting rid of Information Canada?


Joseph Jacques Jean Chrétien: There are other classes of reductions which cross ministry lines.

For instance, the collective budget of the subsidy granting councils will be reduced by a total of $6 million. These are the Canada Council, the Medical Research Council, and the National Research Council of Canada.
The most important class of reduction as far as amounts of money are concerned are non budgetary, that is to say, the loans, investments and advances granted mainly to Crown corporations.
In this respect, the most important proposed reductions are as follows: Farm Credit Corporation: $20 million; Petro-Canada: $40 million. This reduction will not prevent Petro-Canada from starting its operation and fulfilling its engagements with Syncrude.
Atomic Energy of Canada Ltd.: $34 million, thus reducing available funds for construction. The Federal Business Development Bank: $135 million. Construction was supposed to begin in July this year, but it has now been deferred to October next.
The working funds of airports: $15 million; it is an operating fund for independent airports such as Mirabel, Dorval, Malton, Pickering and Vancouver. The capital expenditures will therefore be affected. The Federal Mortgage Exchange Corporation: $75 million, this new corporation will have to delay its opening.
Other reductions which I have not yet mentioned are usually related to a group of items. Thus the anticipated expenditures of the following departments and agencies have been reduced by the amounts indicated: Energy, Mines and Resources, $8 million; External Affairs, $3 million; Indian Affairs and Northern Development, $4 million; Office of the Privy Council $1 million; Public Works, $3 million; Secretary of State, $4 million; Canadian Broadcasting Corporation, $5 million. Solicitor General, $4 million; the Royal Canadian Mounted Police, $4 million; the Canadian Overseas Telecommunications Corporation, $3 million; the Canadian National Railways, $5 million; the National Harbours Board, $6 million; the National Capital Commission, $9 million; and other various items amounted to $41 million.


Steve Eugene Paproski: Where is Information Canada? Why do you not give that up?


Joseph Jacques Jean Chrétien: It is included in the over-all cut.
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The Budget-Mr. Chretien


Steve Eugene Paproski: Why don't you get rid of it and save yourself a few millions?


Joseph Jacques Jean Chrétien: You should know that is not so. Madam Speaker, it is amazing to find the opposition, which always complains that we do not give information, suggesting we eliminate an organization which was established for that purpose. The same people who ask us to have a complete and open policy now ask us to cut it out.


Steve Eugene Paproski: That is your propaganda machine.


Donald Frank Mazankowski: Even the rainmaker says it is a waste. What does Keith Davey say?


Joseph Jacques Jean Chrétien: Madam Speaker, I am going through a very difficult exercise. There is a very small target-


Robert Lorne Stanfield: But a pretty sharp shooter.


Joseph Jacques Jean Chrétien: Finally, the cabinet had examined and approved as part of the November 1974 spending program, projects costing about $165 million which will be excluded from the present spending program and details of which will be announced in the next few weeks or months. Before the end of the year, there will be another reduction of $165 million.


Robert Lorne Stanfield: What date?


Joseph Jacques Jean Chrétien: Mr. Speaker, I point out to the Leader of the Opposition that we shall make an announcement about those $165 million the addition of which will make up the total of $1 billion we are talking about.


Robert Lorne Stanfield: We shall see.


Joseph Jacques Jean Chrétien: The good-humoured remark of the opposition leader does not make me nervous at all. We shall certainly see!
In summary, Madam Speaker, I started with the November, 1974, expenditure budget figure of $35.4 billion. I have accommodated over $1,175 billion of new and unexpected expenditures and have managed to restrict expenditures to $35.6 billion. The hon. member for York-Simcoe (Mr. Stevens) may believe it is possible to accommodate new expenditures of almost $1.2 billion and yet remain at approximately the same total expenditure ceiling without cutting ongoing and planned expenditures; if so, perhaps that explains the great success of the Bank of Western Canada!


Robert Lorne Stanfield: That was a mistake, Jean. You can do better than that.


Joseph Jacques Jean Chrétien: Hon. members will be aware of the dramatic change already made in the rate of growth in the public service. The growth for this year over last was planned to be 4.1 per cent, down from an average of 7.1 per cent in the previous two years. In spite of this, departments have been told that 1 per cent of their salary budgets and 1 per cent of their man-years for 1975-76 have

been frozen and may not be used. The reduction in man-years should be about 3,000 and the rate of growth will then be about 3.1 per cent rather than 4.1 per cent.


Robert Lorne Stanfield: That is formidable.


Joseph Jacques Jean Chrétien: Yes. We have cut our growth by 3 per cent, from 7.1 to 4.1. There has to be some increase. I could have said that there will be zero growth this year, but you must realize that some departments serving the public need more manpower. The opposition would have been on my back right away if we had not provided for the appointment of more RCMP officers.


Steve Eugene Paproski: Get rid of Lajoie and save at least $1 million.


Joseph Jacques Jean Chrétien: We have been reasonable. As I say, the rate of growth in the public service will be about 3.1 per cent rather than 4.1 per cent, whereas the average rate of the two years before had been 7.1 per cent.

A further effort to cut expenses: the Treasury Board no longer allows departments to reallocate the balance of their frozen salary budgets to other items. Departments generally cannot increase their staff, regardless of manpower limitations, even to this year's low level. This situation is due to the difficulty of finding competent employees, to unavoidable delays in hiring and to other reasons. Departments have always been free to use their salary budgets to hire temporary help from agencies, to buy equipment or to hire consultants under contract for the purpose of a program.
Even though there may be exceptions, the fact that departments will no longer be free to generally reallocate the funds of their salary budgets will entail the lapsing of estimates which would otherwise have been spent.
Both measures dealing with salary budgets should make it possible to save from $30 million to $60 million. I should like now to make sure that there is no misunderstanding on two points. First, the decrease in man-years which I mentioned will be effected by attrition. Layoffs are out of question. Second, the reduction in man-years will require departments to reassess the services they provide or proposed to provide. Departments will have to cut down certain services and defer the implementation of some new services, thus unavoidably creating inconveniences for the users of those services.
Service departments have very large staffs and are mostly responsible for growth increases. However, given the limits imposed on our margin of manoeuvre, which I described at the beginning, and in view of the approximately $1 billion objective we set up for ourselves, we had to insist on a reduction of man-years at the risk of inconveniencing the public. My deputy minister wrote to deputy ministers and organization leaders urging them to take measures aimed at lowering consultants and travel expenses during the present financial year. That letter has to do with expenses that are not essential to the permanent efficiency of programs.
We know that several million dollars will be saved on that item and we will take steps to have the order respected; but we did not want to give a specific amount in that
July 2, 1975

statement because it would perhaps have misled the House a little since it is very difficult to give an exact figure, but that will involve several million dollars.
With regard to direct employment programs, hon. members will remember that the budget speech mentioned $25 million for financing labour intensive federal works for the next two years. This has already been adopted within the framework of measures to fight unemployment. As was the case previously, these programs are also under my department's jurisdiction.
We propose to ask departments to provide us with details on works that should be done in the fields most seriously affected by unemployment. They will be asked to submit projects that may be started quickly, that agree with the program's objectives and that require almost no investment so as to ensure that the funds available produce the maximum number of direct jobs.


The Acting Speaker (Mrs. Morin):: Order, please. I regret to interrupt the hon. minister, but his time has run out.


Some hon. Members:: Carry on.


The Acting Speaker (Mrs. Morin):: Does the House consent unanimously to the minister's finishing his remarks?


Some hon. Members:: Agreed.


Joseph Jacques Jean Chrétien: Madam Speaker, I thank hon. members for their courtesy. I should like to deal briefly with the matter of collective bargaining in the public service. It is almost a year now since I became President of the Treasury Board. In that time I believe I have established a very healthy working relationship with many of the public service union leaders. They are hard and tough bargainers but they are reasonable people; they understand that inflation hurts their membership as much as anyone else. I know that they are prepared to co-operate with the government in its policy of restraint.
I can assure them that all sectors of the economy will have to bear the burdens of the fight against inflation. It is not the policy of the government to fight inflation on the backs of public servants; that is why the Minister of Finance (Mr. Turner) reiterated the long-standing government policy of paying salaries comparable to those paid for similar work outside the federal public service. The policy of comparability ensures that workers inside and outside the public service are treated equally and bear equal burdens.
There are differences between union and management each time a contract is negotiated; but with reasonable people on both sides of the bargaining table, these differences are almost always resolved without resort to a strike. Indeed, since collective bargaining was introduced in the public service in 1967 there have been nine legal strikes. Three hundred and twenty-five collective agreements have been signed without strikes. Man-days lost through strikes in the federal public service, both legal and illegal, have been 0.238 per cent of estimated work time. Man-days lost through strikes outside the federal public service have been 0.35 per cent of total estimated
The Budget-Miss MacDonald
work time. Our record in this respect is 50 per cent better than that for the work force as a whole. This is a good record; it is testimony to an attitude of reasonableness on both sides of the bargaining table. I am confident that we can maintain this record even in difficult economic times.
Sometimes a strike is the outcome of honest disagreements which cannot be reconciled. In these circumstances, I want to be clear that the government will accept a strike rather than settle in a manner that is irresponsible. I hope the Canadian people will be prepared to accept the resulting inconveniences. More often a strike represents a breakdown in communications between union and management. In the interests of ensuring close communications, I have been meeting frequently with union leaders in the public service. The purpose of the meetings has been to establish on both sides a better understanding of our problems so as to identify and eliminate situations which can lead to confrontation. I can assure the House that both the unions and Treasury Board are doing everything possible to avoid situations which cause what are, really, unnecessary strikes. In the times ahead I intend to be very firm, but reasonable, at the negotiating table. I have every reason to expect the same from the other side of the table.
These cuts will be criticized as being unnecessarily harsh. They will be criticized by those who usually say that government spends too much. Madam Speaker, we have decided that restraint is necessary. In order to exercise restraint we had to cut back on planned expenditures. Our critics say we should cut back somewhere else. "Somewhere else" is not good enough. I had to cut somewhere, and I did. I hope this information will be satisfactory to the House. In order to make it even more specific, I should like, with permission of the House, to table two tables, one in French and one in English, naming every department affected, together with the amounts of money they have been instructed to cut, set out under various headings: capital, grants and contributions, and nonbudgetary expenditures.


The Acting Speaker (Mrs. Morin):: Is that agreed?


Some hon. Members:: Agreed.


Stanley Howard Knowles: On a point of order, Madam Speaker, I believe the minister merely asked to have these documents tabled. Would he also ask that the documents be made an appendix to Hansard, so that all of us can see them?


Joseph Jacques Jean Chrétien: I have no objection. I should like the documents to be made as public as possible, and I will ask Information Canada to assist in this objective.


The Acting Speaker (Mrs. Morin):: Is that agreed?


Some hon. Members:: Agreed.
[Editor's Note: For tables referred to above, see Appendix "A"]


Miss Flora MacDonald (Kingston and the Islands):: Madam Speaker, following the revelation by the President
29576-41)4

July 2, 1975
The Budget-Miss MacDonald
of the Treasury Board (Mr. Chretien) of the government's new policy of openness, I will expect to receive from him wholehearted support for the reference of the capital spending budget of CMHC to the Standing Committee on Health, Welfare and Social Affairs so that its members might look into the operations of that closed shop from now on. I hope the minister will be able to live up to the commitment he made today.
Madam Speaker, housing is a social right in this country. Surely there should be no argument about that, yet there is less and less recognition of this fundamental fact of life by this increasingly cynical and callous government. The anxiety and anguish felt by Canadians from coast to coast-home builders, home owners, landlords and tenants-over the distressing housing situation in this country was intensified by the government's failure in its budget proposals to make any attempt to reverse the mounting social disorder which the current housing crisis is precipitating. Social disorder and inadequate housing are problems which the government constantly considers as unrelated, but study after study, such as the one undertaken recently by Professor Larry Bourne, director of the University of Toronto's centre for urban and community studies, foresees considerable social disorder and a violent political reaction if we fail to come to grips with our housing problems.
Last week's budget did nothing to allay these fears. Why? Is it because the government has not recognized the seriousness of the problem, or is it that it just does not care? For too long there has been false complacency on the part of the government that the housing crisis would correct itself if ministers collectively turned their backs on it or if those primarily responsible individually turned their backs when the ball landed in their court. We have only to look at what was said by the Minister of Finance (Mr. Turner) and the Minister of State for Urban Affairs (Mr. Danson) in their pre-budget statements to see how adept they are at turning their backs on the housing problem. Unfortunately, post-budget analysis bears out this dubious skill. These are the words of the Minister of State for Urban Affairs on May 16, 1975:
I have complete confidence that the Minister of Finance will take all these things under consideration when he brings down the budget.
He was referring, of course, to those factors which adversely affect housing and mortgage rates. Well, Madam Speaker, that confidence was badly shaken on budget night. Then again, on the same day, the Minister of Finance told us:
I have enough trouble scheduling meetings with my own colleagues in the provinces without being concerned in every detail with how my colleague-
That is, the Minister of State for Urban Affairs.
-is able to achieve it.
Thus he very deftly turned his back on the situation. On May 23, the Minister of State for Urban Affairs threw the ball to his colleague the Minister of Finance. The Minister of Finance, he stated-
-is certainly aware of the problem. He gives it very high priority and understands its importance, not only socially but in the economy. He understands the urgency of the situation.
Given the budget proposals, the minister responsible for housing must now be entertaining very real doubts about

the way in which the Minister of Finance arranges his priorities or, indeed about the urgency he attaches to any situation. I call attention to the words of the Minister of Finance on March 10, 1975:
One of the government's priorities is to give sufficient leverage to the Minister of State for Urban Affairs to enable him to achieve a rate of housing starts equivalent to 210,000 a year.
That was in March of this year, Madam Speaker. How short is the memory of the Minister of Finance, how brief his commitment not only to the people of Canada but to his own colleague, the Minister of State for Urban Affairs, who last week backed away when invited to reaffirm that this minimum target of 210,000 housing starts would be achieved.
The Minister of Finance had the opportunity to honour that commitment of March 10. He had the opportunity to do so when he brought down the budget. But he failed to take it. His housing proposals are totally inadequate to meet the housing crisis. Again I ask, why? Was it because of lack of appreciation of the real situation? If that was the case, let me remind the Minister of Finance of the facts, the hard, cold, cruel facts which exist in Canada today with regard to housing.
The annually adjusted rate of housing starts for the first five months of 1975 is 176,000. The Economic Council of Canada states that 245,000 starts are needed this year. CMHC estimates that 230,000 new family formations will occur in 1975. The target of the Minister of State for Urban Affairs for this year was a minimum of 210,000 starts. Just last week he admitted that without considerable extra stimulation of the residential construction industry, that minimum target would not be met. By his own admission, as well as that of the agency for which he is responsible, there will be a shortfall of accommodation for some 50,000 family units this year. He looked to the Minister of Finance for help, and the Minister of Finance in his budget threw him a token 5,000 starts. That is one of the hard, cold facts in this situation, Madam Speaker.
The largest single expenditure in the budget of most Canadian families is for accommodation. In its direct lending programs, CMHC stipulates that shelter costs should not exceed 25 per cent of a family's budget; that is, if they are going to be able to meet the other necessities of life. Yet many lower income families are spending over 50 per cent of their budget on shelter costs. Not only does this reduce their capacity to buy other essentials, but at the same time, as the Canadian Council on Social Development points out, many of these people-something in the order of one million Canadian families-are inadequately housed. That is another hard, cold fact which the Minister of Finance has chosen to ignore.
It has been stated frequently in this House and elsewhere that the lack of rental accommodation, particularly in our urban centres, is at the crisis level. In many communities throughout Canada the apartment vacancy rate has fallen under 2 per cent, whereas the president of the Housing and Urban Development Association of Canada states that a vacancy rate of 4 per cent to 5 per cent is considered to be the very minimum for a healthy rental market. An average of 70,000 new rental units are needed
July 2, 1975

annually to meet this goal. This year the number of starts in rental accommodation has fallen to barely half the requirement. The minister's budget proposals have done almost nothing to alleviate this shortage, with the result that the crisis we face in apartment space this year will have developed into an absolute disaster by this time next year, particularly in our metropolitan areas. This is another hard, cold fact.
The rural and native housing program which was introduced with such ballyhoo over a year ago was expected to provide 10,000 new units this year, particularly in areas where the private sector traditionally has had neither the incentive nor the initiative to enter into building programs. The government's own program was to provide
10,000	units this year, yet figures show that only 400 new units have been started to date. What about the expectations of the other 9,600 families? The Minister of Finance obviously does not care. That is another hard, cold fact.
One might be inclined to dismiss these statistics as clinical data if they did not bear so directly on the most significant factor in our lives-the way in which Canadians are housed. But these statistics are danger signals, obvious enough for even a government as obtuse as this one to see, that the shortage in housing accommodation and the woeful inadequacy of rental accommodation is increasing rather than decreasing. But the government chooses to fly in the face of these danger signals. The housing measures in the budget are but the latest confirmation of their lack of concern for, or even their lack of recognition of the problems that proliferate while they procrastinate.
This budget has left me with a sense of outrage which is shared by home buyers, builders and economists-in fact, by all concerned Canadians-outrage that a government would introduce such paltry measures at a time when the need for major measures is so desperate. Is the government so blind that it fails to see the magnitude of the crisis? Does it not recognize the ingredients in the problem-the shortage of mortgage money, the high cost of money, the high cost of land and the strangling web of bureaucratic regulation? Given the clarity of the issue, must the government diffuse or distort the true picture with unrealistic responses?
The Minister of State for Urban Affairs has been deluding himself for so long that he is not even aware when he is making misleading statements. In ringing, Churchillian prose he declared last Friday that "never in the history of federal government housing programs has everything moved so well with such success for the right people in the right income ranges". However, what about those people who are not in the minister's so-called right income ranges? How many of the 230,000 new household formations that will need homes this year are in the right income range? How many of the one million Canadian families that are inadequately housed are in the right income range? And of the families in Canada that are in the right income range, what percentage is, in the minister's words, "the right people"?
On budget night, the Minister of Finance promised that the Minister of State for Urban Affairs would give us the breakdown of the additional moneys allocated for housing by program and by province. I fully anticipated the Minis-
The Budget-Miss MacDonald
ter of State for Urban Affairs to do so when he spoke, but he did not. So a lot of Canadians are wondering today if they meet the minister's qualification of being the right people in the right income range.
The minister has belatedly arrived at an acknowledgement that some of his hastily devised programs are not working even for the right people in the right income ranges, whoever they may be. Take private AHOP, for example. Recognizing its shortcomings, the minister is now attempting to shift the blame for its failure to the opposition. He pleads that the program has been in operation for only two months. The legislation received royal assent on March 26 of this year. By any calculations but the minister's, surely the program has been in operation for three months. The delay is in the mind of the minister or his officials.
On several occasions the minister stated that the legislation regarding private AHOP was held up in committee, but let me put the record straight, Madam Speaker. The legislation which the minister anticipated would revitalize the residential construction industry was presented to the House for second reading on January 27; it was in the House for debate for four days only but was not referred to committee until February 27. In all, there were only six committee meetings between March 6 and March 20. Some of these were needed to hear witnesses who were able to contribute useful information, information which was not forthcoming from the minister or the president of CMHC.
The minister complains about delay, but what about his delay in explaining the bill to the lending institutions so that they would be prepared to take immediate advantage of it? If the Minister of State for Urban Affairs had really been serious about his sales pitch to the lending institutions, I suggest, without trying to deflate his ego, that he would have been better advised to persuade the Minister of Finance of the benefits and the urgency of this program. Then together they could perhaps have gone out hand in hand to the lending institutions. But they did not; rather, the two ministers were operating independently and at odds so far as private AHOP was concerned. It is time these two ministers recognized that housing is influenced by capital markets and that capital markets influence housing.
The Minister of State for Urban Affairs, in his participation in this debate, said:
Clearly there are very heavy demands on capital markets and, secondly, there has been a scarcity of capital funds for new residential construction in the lower and moderate income ranges.
That was scarcely news, Madam Speaker. Indeed there are heavy demands and a scarcity. But why? I suggest it is because the Minister of Finance is busily floating bond issues for government programs other than housing and taking money out of the market. These are funds that might have been directed to the private AHOP program the Minister of State for Urban Affairs is so anxious to develop. The minister can look for scapegoats, but perhaps the first one he should look to is his colleague, the Minister of Finance, whose policies have been responsible for depleting the market of mortgage moneys.

July 2, 1975
The Budget-Miss MacDonald
As I have said on several occasions, there is a supply problem and a cost problem in housing. The Minister of Finance addressed himself to neither in his budget. On Friday, the Minister of State for Urban Affairs addressed himself to the supply problem without ever tackling the cost problem. Obviously, he had hoped that his colleague the Minister of Finance, would deal with the cost problem in his budget-that is, the high cost of money, the shortage of money, the high cost of land-and in that way get him off the hook. He was disappointed, as are many Canadians. Surely both ministers must realize that on the cost side, clearly, the foremost problem affecting builders and buyers alike is the cost of mortgages. High mortgage rates discourage builders from constructing units which they know they cannot sell or rent economically.
Lest the minister think I am biased in my view as to the shortcomings of his budget in meeting the housing crisis, let me cite what more objective critics have to say. On June 24 of this year, the day after the budget, Arthur Mingay, president of Canada Trust Company, said:
Average house prices will jump another 15 per cent this year. Mortgage financing is likely to become costlier because the interest rate necessary to attract term deposits will rise.
In addition, he said:
With a strong demand and a supply well below our real potential, a shortage of housing and rental units is inevitable, probably through the remainder of the 1970s.
On June 24, 1975, again the day after the budget, the Conference Board in Canada, in its statement "Economic Implications of the Federal Budget" stated:
But the stimulus here, to the extent that it really operates, is more likely to stimulate demand than supply of new housing-and could conceivably push the economy even more quickly to a severe housing shortage within the next year. The key issue of finding increased stimulus to expanding supply of new housing has not been directly addressed in this budget.
These statements come from concerned and objective critics, yet the Minister of State for Urban Affairs had the audacity to say on Friday:
Now builders see that the financing is there, the market is there, and they are building successfully to that market, providing good housing and not continuing to construct homes that Canadians can no longer afford.
What rot! What fantasyland is the minister living in? What could possibly lead him to say, as he said on Friday: There are programs for which people are actually lining up. The success has been phenomenal.
When he talks about the success of these programs as being phenomenal, all he has to do is look at the success rate, which falls 50,000 units short of his target this year and leaves hundreds of thousands of Canadians with restricted and inadequate shelter. When is the Minister of State for Urban Affairs going to get serious about this problem? The minister, in his harried search for scapegoats, also turned on the provinces on Friday when he stated that the provinces have used up only 54 per cent of their allocations from CMHC, and urged them to take up their funds. The implied criticism that the provinces are responsible for this situation is not only unfair but misleading and malicious. The minister knows full well that the provinces have urged the federal government to make commitments on a longer term of three to five years so they can plan their programs to achieve maximum advan-

tage of their funds, yet the government refuses to meet this very reasonable request.
Moreover, the minister knows full well that the costsharing projects must in the final analysis have the approval of CMHC, but the red tape, the bureaucracy and the lack of sense of urgency in the citadel of CMHC does more to prevent the provinces taking advantage of their full allocation than, as the minister would imply, their tardiness. I would not for one moment accuse the powers that be in CMHC of being devious, but it does seem to me very odd that the CMHC direct lending programs have an 80 per cent or better approval rate from the corporation, while provincial programs are only running at a 54 per cent approval rate. One can only wonder if the minister and the president of CMHC are trying to make their records look good at the expense of the provinces.
Surely we should be able to expect a greater measure of sense and sensitivity to the housing crisis than the minister exhibited in his speech on Friday and as we had from the Minister of Finance in the housing proposals in his budget. The most baffling thing about the Minister of Finance's inadequate housing measures is that this was the one sector of the economy where a significant stimulus would have attacked the twin problems of inflation and unemployment. Increasing the supply of housing would be deflationary. In fact, without a substantial increase in the housing stock, prices are bound to continue to rise. Moreover, thousands of workers now unemployed could have found jobs if there had been more stimulus given to housing.
What stimulus did we get? We got a $200 million promise that, in typical fashion, was revised downward to $125 million before the minister had finished his speech. That is $125 million to stimulate the residential construction industry, a sum to be divided among several programs and many provinces, a sum far below what the provinces asked for in January for public housing alone, and a sum that will provide perhaps 5,000 starts when 50,000 are needed. Can anyone, the Minister of Finance, the Prime Minister (Mr. Trudeau) or the Minister of State for Urban Affairs, explain why the government's commitment to housing was a mere $200 million, when it saw fit to allocate $285 million to that social employment-cum-patronage program known as LIP? Can anyone explain this government's perverted sense of priorities? There are priorities, and I want to cite them for the minister. They are the need to reduce the burden of high interest rates, the need to increase housing starts, the need to increase the flow of mortgage funds, and the need to increase the supply of serviced land.
First, to meet the need to reduce the burden of high interest rates we would propose that the cost of mortgage interest payments in excess of 8 per cent would be deductible from personal income taxes, up to a maximum of $1,000 annually. This policy is designed primarily to ease the heavy burden on family budgets caused by current high mortgage interest rates, more than 11 per cent, which are a direct result of the government's massive balance of payments deficit and the accompanying need to maintain domestic interest rates at a high level. While it would not directly stimulate new housing starts, this measure undoubtedly would help to restore consumer confidence in
July 2, 1975

the viability of home ownership and thus encourage more Canadians to enter, and to be able to afford to enter, the home ownership market. There is no time limit on the proposal, although it might be termed temporary in that we assume that, with effective government leadership, mortgage interest rates would subside from their present level to the 8 per cent range where they were before the current bout of inflation took hold under this government.
Second, to meet the need to increase housing starts we would propose to institute subsidized mortgages down to an interest rate of 8 per cent to finance new home and apartment construction during the next two years to ensure an annual level of at least 250,000 starts. This is essentially a supply program designed to stimulate the lagging residential construction industry through a major injection of low-cost mortgage funds. The funds themselves would be provided by the major institutional lenders. The government would subsidize the cost differential between their lending rates and 8 per cent.
This proposal represents a much needed extension and revision of the existing private AHOP program. Our proposal would embrace both single family and multiple dwelling starts. More important, it would erase the bureaucratic red tape caused by the present AHOP regulations governing maximum allowable incomes and housing prices and substitute a single control factor: subsidies would be provided only on the first $30,000 of mortgage financing, thus ensuring that there is no excessive benefit either to upper income earners or purchasers of more expensive homes.


Mr. Caccia:: It is a subsidy to the money lenders.


Donald Stovel Macdonald: What do you think you have at the present time with the AHOP program? You had better look at your own legislation.
Third, to meet the need to increase the flow of mortgage funds we would propose a special investment tax credit on interest for funds invested in certificates issued by institutions guaranteeing that all money so raised would be used for residential mortgage financing. One of the major causes of the current housing crisis is the lack of available mortgage funds. This proposal is designed to deal with that problem by offering a special tax incentive to Canadians to invest their funds in mortgage lending portfolios. Debt instruments like the five-year guaranteed investment certificates issued by trust companies could readily be adjusted to encompass this tax incentive. But any bona fide lender could offer it as an investment incentive provided he was able to guarantee that funds so raised would be used solely for residential mortgage financing.


The Acting Speaker (Mrs. Morin):: Order, please. I regret to interrupt the hon. member, but the time allotted to her has expired.


Some hon. Members:: Carry on.


The Acting Speaker (Mrs. Morin):: Is it agreed that the hon. member may complete her remarks?


Some hon. Members:: Agreed.
The Budget-Mr. B. Loiselle


Donald Stovel Macdonald: I thank hon. members. It is suggested this would be a two-year program designed to attract an additional $1 billion to the mortgage market this year and $2 billion more during the full year of 1976.
Fourth, to meet the need for the increased supply of serviced land, we propose the creation of a special municipal services development fund to provide $500 million in low interest loans over the next three years to municipalities for land servicing and development. This proposal is designed to help correct the chronic problem of insufficient serviced land coming on to the residential housing market. The fund would be administered in close co-operation with the provinces. Long-term loans would be available from it to the municipalities for the provision of basic sewer, water and other subdivision services, on the understanding that service standards would be held to acceptable minimums and that lands so serviced would be used for mixed housing development geared to the needs of various income groups.
In summary, the budget of June 23 failed completely to meet the housing needs of Canadians. All it did was add $125 million this year to a collection of policies that already have proven ineffective. There is not a single proposal in the budget to deal with the major shortages of either residential mortgage money or serviced land. The proposals I have put forward are designed to meet the current housing crisis head-on. The cost of these programs for 1975 would amount to $275 million, and this could be achieved by simply reordering the priorities in government spending.
What is needed is a commitment by this government to exercise leadership to alleviate the crisis in the crucial housing sector of our economy-crucial because of its economic and social consequences. This budget, in its niggardly approach to the housing needs of Canadians, has once again proven that such commitment by the government is sadly lacking.


Mr. Bernard Loiselle (Chambly):: Mr. Speaker, may I be allowed to comment briefly on the reaction of one hon. member from Quebec in this House to the budget brought down by the Minister of Finance (Mr. Turner). First of all, a few very general remarks: the budget proposed by the present government for the coming year will probably not be very popular with all Canadians nor all groups in Canada. And here's why.
First of all, the budget is fair; it applies the same principles to one and all; this, in fact, never pleases the good conscience of the most favoured, of whom more is asked to achieve greater justice in as vast and diversified a country as Canada.
Second, the budget is realistic; in a period of stagflation, following international inflationary pressures without precedent, it must reflect the economic uncertainty which weighs upon all citizens in today's world. In that sense, it could be neither clearly expansionary, nor too depressing for the present economic situation in Canada. In spite of everything, this budget demonstrates that Canada and its government are taking the world economic upheaval seriously and trying to make the necessary adjustments.

July 2, 1975
The Budget-Mr. B. Loiselle
Whoever reads the commentaries by Economist Gunnar Myrdal, the recipient of the 1974 Nobel Prize for Economics, and some other research specialists, including those attached to the OECD, may wonder if the Keynesian economy has really had all the merit we have come to recognize on contemporary development. One may wonder particularly if the out and out expansionist policies advocated by several industrialized countries during the 20th century are not responsible for the successive crises which have characterized the economic evolution of the contemporary world and, more specifically, if our attitude towards recession and stagnation has not caused us to blow up inflation to crisis proportions.
In the light of the new criticism which has been levelled at the Keynesian theories, it has been noted that various types of government responses have been particularly detrimental to every attempt to keep the inflationary phenomena under control. Some especially seathing criticisms made in this context have put a large part of the blame for the current crisis upon the restraint program, the price freeze imposed in 1971 by the Nixon administration. However, Canada has tried to avoid these gaudy and extreme policies such as a wage and price freeze claimed by our friends on the opposite side, and policies based on general indexation.
This present budget aims to maintain the clever realism which convinced many international analysts. However, it also wants to give it the special aspect of a voluntary restraint of expenses. It is obvious that this is the only way for the Canadian government to maintain its capacity to obtain restraint gestures from its partners in the future, in the matter of profits as well as salary increases.
Considering that Canada is affected by an inflationary tendency fueled mainly by salary increases granted in anticipation of a possible inflation, considering that the last major agreements signed throughout Canada grant salary increases ranging from 17 to 19 per cent, finally, since average industrial wages are now 4 cents higher in Canada than in the United States, one understands the urgency for a fast concertation and a cooling off of salary increases.
Next year, maybe even this year, Canada will be the highest paying country in the world, ahead of the United States, certain Scandinavian countries, Germany and other countries, which might gratify the vanity of Canadians, but should worry them for their long term prosperity.
The example set by the government was urgently needed, but this budget tried to achieve it by resorting to its credit power, by restricting harsh cuts and by maintaining the major thrust of this country towards a democracy providing all its constituents from coast to coast with equal privileges.
Were such measures not good enough to achieve the objectives set by this budget, the government shall have to take action at the level of income formation and find in taxation tools appropriate to the inflation age.
France has already developed in 1975 a short-term tax which is an example of new anti-inflationary tax techniques advocated by experts such as professor Winstraub. The basic purpose of such a tax is to induce the companies

with productivity gains above the national average to pass them on to the final users by lowering their selling price.
Such a mechanism can be used by taxing those companies with an increased cash flow due either to a selling price higher than the general rise in prices or to a productivity increase above the national average, but which have not reduced their selling price accordingly.
Finally, this system could be applied generally, not only to companies but to all economic sectors concerned through a fixed and progressive surtax on personal income, so that the individual getting an annual wage increase above the acceptable national level, would have his surplus taxed so as to strengthen the redistributive nature of the tax. The technique dealt with by Andre Raynault seems to me to be one of the last remedial measures to restore our economic health, but it is also one of the most effective if the budget does not succeed in inducing business to support the government's efforts.
Unlike the previous speaker, I am quite pleased to see the government increase CMHC estimates by $200 million this year. Mr. Speaker, this expense is highly justified since the number of starts has gone down from an annual rate of 284,000 in the first quarter of 1974 to 161,000 in the first quarter of 1975. Yet, we must note that this decrease is due to the economic situation and not to a lack of federal policy.
This is shown by the fact that non-budgetary funds granted to non-profit organizations for the construction of rental accommodations have increased from $72.9 million in 1970 to $124.7 million in 1974. Also, the government has implemented many new housing programs since 1972. I shall mention only the two programs concerning new communities in their first stages which show good promise for the future, as well as neighbourhood improvement loans and the home renovation program. But the most vital programs at this time are two new programs, the cooperative housing assistance program, for which the non-budgetary funds were $7.6 and $19.8 million in 1973 and 1974 respectively, and especially the very important Assisted Home Ownership Program, for which the nonbudgetary funds were $133.1 million in 1973 and $345.2 million in 1974.
Moreover, we must note the development of the housing starts in Canada and the United States in the last few years. I shall simply mention that, from 1971 to 1972, housing starts increased by 10.5 per cent in the United States compared with 6.8 per cent in Canada, but that, from 1972 to the first quarter of 1974, housing starts decreased by more than 30 per cent in the United States while they increased constantly by 13 per cent for the same period in Canada.
We are going through a difficult period as concerns housing, but we can see that federal measures have greatly limited the effects of inflation. And, in this budget aiming at fighting inflation, the larger budget of the Central Mortgage and Housing Corporation is most timely and should confirm and emphasize the resumption of housing starts noted by the Minister of Finance in his speech.
I also wish to say that although the released funds do not form a geometric progression with those of last year, an increase of $200 million over a budget that already last
July 2, 1975

year represented an unprecedented and important effort cannot but help achieve the objectives of the government, which are to provide decent shelter for as many Canadians as possible, be it a single family house or a low rental unit. Needless to say that such an effort, if it is sustained over a three year period, for instance, must nevertheless bring longer term results over a period of 10 to 15 years.
The second aspect that strikes me is the policy put forth by the government with regard to energy and illustrated in the budget. As anticipated at the last federal-provincial conference on energy, the government has upped the price of a barrel of Canadian oil. It has also provided new tax measures granting exemptions to companies willing to engage in oil research, exploration and development.
As Andre Raynault pointed out in a recent speech, it was important to put an end to the cosy situation Canada enjoyed compared with the world energy situation, even though oil and gas are part of the life of every Canadian and account for almost 60 per cent of all energy consumed in Canada in 1974.
By maintaining domestic prices at levels substantially lower than international prices, Canada was only pushing the term further away and subsidizing private citizens according to a formula that was definitely less fair than income tax. Such practices encourage energy consumption and they discourage the search for new oil sources and the development of alternative energy sources. By playing the rich uncle, Canada was drifting away from world trends, which is unacceptable in our days of interpendent world economies and leads to economic downturn at a time when oil sells at $2 a gallon of gas in other industrialized nations. The new measures in the budget should help limit consumption. This is desirable in a global perspective. It should however be conducive to two types of measures meeting new needs created by high energy prices and the requirement to find new transportation modes less costly than the private automobile.
The present budget answers the first question. It favours harmony at the national level by ensuring a minimum of justice as far as resource prices are concerned. The single domestic price for oil is essential to a united confederation. But demand growth, which probably will outrun domestic production by 1978, requires the development of new operations. Within the next 10 or 15 years, three main sources of oil and gas energy may be tapped.
The first one is the vast tar sands areas. Production had until now been prohibitive by private corporations and even by the government, in view of the low domestic price for oil. With the prices likely to keep on increasing, and with the new incentives for companies to do exploring works, we shall soon find ourselves in a position to exploit these important but costly resources. Other oil or gas products may be found in the far north and offshore in the east. The most optimistic are hoping to extract about
500,000	barrels a day within seven or eight years.
On the whole, if we are to become somewhat self-sufficient in energy in Canada we will have in the next fifteen years to get investments exceeding $25 billion for the development of new resources in the west, the north and the east of our country. If not-and perhaps our colleagues
The Budget-Mr. B. Loiselle
on the other side may find it advisable to remember that in three years-we shall be at the mercy of exporting countries. Then it is not raises of 10 to 15 cents a gallon of gas that Canadians will have to pay but more. It was therefore urgent to start funding this year the development of resources which will be necessary on a long term basis. That is what the budget provides for. However, a new need probably will develop among consumers: for want of an automobile, they will need a well-integrated public transportation system. In that respect, I would like to raise a problem dealing with budget prospects for the few years to come. Although I agree that the present budget restrictions are necessary, I dare hope every attempt will be made to implement as fully and as quickly as possible aspects of our national transportation policy which still will have to be stated, along the lines of the program which the Liberal party put forward during the last 1974 electoral campaign. Those investments indeed have to be made on an emergency and priority basis to provide for long term substantial economies of oil products, and for a smooth development of Canadian trade, as well as to solve one of the most delicate problems of the development of urban communities in Canada.
What I have in mind especially is the last aspect of the question, mainly the help to public urban transportation and commuting systems. The Chambly constituency which I represent spreads over a wide area of Montreal's south shore. We in that region have a huge problem with respect to public transportation, not to say that we hardly have any public transportation at all. The management of public transportation in the main cities of that area was recently unified witin the new Montreal south shore transportation commission. This commission already works with the cooperation of the Quebec Department of Transport and is actively updating the present system and developing a broader and more complete system to provide people in that area with adequate means of transportation.
However, establishment of the new system is still in its infancy, and things will remain so until details of the new national transportation policy have been made operative and known to the public. I am aware that the Canadian Department of Transport is preparing a thorough and extensive policy in this field.
I should like to remind my colleagues of the major lines of the government's election program with regard to urban and commuter transportation. Among other things, the program promised to finance 100 per cent of the deficits in the field of commuter transportation by rapid train, to pay 50 per cent of the construction costs for stations within such a system as well as 25 per cent of the urban public transportation deficit with regard to travellers wanting to reach the suburban system. As a result, I am impatiently awaiting the official announcement by the Minister of Transport concerning the terms and conditions of the application of such measures and promises, and I urge the Minister of Finance as well as the entire government to request urgently that Parliament vote the necessary credits for their swift and thorough application. As a Liberal candidate in the last elections, I made this program totally mine, and together with all my colleagues I will do my utmost to see to its implementation.
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July 2, 1975
The Budget-Mr. Hogan
This budget states how strongly Ottawa wishes to restrain expenditures in one area, especially on the items of medicare and hospital costs. Indeed, it is desirable that those systems be brought down to more reasonable growth rates and that they represent less heavy a burden for the federal budget. It is to be noted however that the federal government itself has drawn the provinces willy-nilly into those shared costs programs, for which they were not all overly enthusiastic. Fortunately, in this regard, the government has provided itself with a five year period to resume negotiations with all its provincial partners where needed so that new arrangements might be worked out according to a real consensus.
As far as medicare is concerned, it will be noted however that the restrictions put into this budget remain very small. And I am sure that with his tact, the minister of National Health and Welfare (Mr. Lalonde) will be able, when he will start talks with the provinces on this matter, to achieve a solution which will not put a heavier burden upon the provinces but will provide the interested parties with methods which will slow down the growth of costs while increasing the exceptional quality of the services given to Canadians.
Lastly, Mr. Speaker, the only measure that puzzles me is the change to the Unemployment Insurance Act to exclude people aged 65 or more from the unemployment insurance program. I am assured that this measure will be accompanied by another that will improve the quality of life for those who built the Canada we have today. The 65 year olds who wish to remain on the labour market do so by necessity and surely not for their pleasure.
To conclude, I wish to repeat, Mr. Speaker, that my riding of Chambly is progressing admirably well at the industrial level but it needs a lot of assistance from the Minister of Environment (Mrs. Sauve) and the Minister of Indian Affairs and Northern Development (Mr. Buchanan). In the last budget the funds of the Minister of Environment were cut by about $51 million and I hope that those cuts will not affect the execution of the works already planned and that, at least, the federal government will be able to sign very soon the tourism agreement that should give to my area about $12 million for touristic development and the improvement of the environment. I hope that this agreement will be signed as soon as possible so that these works can start this fall or next spring at the latest.


Mr. Andy Hogan (Cape Breton-East Richmond):: Mr. Speaker, despite the apologists for this budget who exist on the other side of this House, amongst the news pundits of this country this is a do-nothing budget. Someone has said that it reminds one of a person who goes fishing, not to fish but to sit around doing nothing. It would be charitable to call this budget neutral-a budget which will result in putting another 100,000 to 150,000 Canadians on unemployment by this winter when there are almost 700,000 there now. It would be more realistic to refer to it as mediocre. Indeed, it is worse than that. Rather than stabilizing the economy, as budgets are usually meant to do, this one ensures that for the next year we will live with very high prices and very high unemployment.

It is very easy to understand why Mr. Peter Brimelow, writing in the Financial Post, said that this is a budget which pleases Bay Street in Toronto. Little wonder that the parliamentary leader of our party could say, after listening to this budget, that the game plan of this Liberal cabinet, led by the Minister of Finance (Mr. Turner) and the Prime Minister (Mr. Trudeau), is that the corporate welfare bums will receive $350 million and the public of Canada zero. One can easily understand why the Leader of the Opposition (Mr. Stanfield) referred to the budget as a cynical document.
The part of the minister's budget which has received the most notice and criticism has been the gas and oil increases, and well it should. The 15-cent addition to the gasoline bill is, to say the least, a solar plexus punch to the ordinary working men and women of this country. Let us consider, as well, its effect on the poorest provinces of this country, the Atlantic region provinces. Let us consider my own province of Nova Scotia. We all know that oil price increases are serious in the rest of the country: they mean higher gasoline prices, higher prices for many manufactured products, and higher home-heating prices.
In my home province we will pay a much higher price for power because we depend on oil-fired electricity for 55 per cent to 60 per cent of our needs. Because of our higher industrial capacity relative to the other Atlantic provinces, oil price increases hurt Nova Scotia more than any other province.
The Nova Scotia Power Corporation estimates that our province uses 40 to 45 barrels of oil per person per year, while the Canadian average is about 25 barrels. Based upon comparative prices, but more especially on the security of supply concept, we in Nova Scotia, through the Cape Breton Development Corporation, are trying to use more coal, but as of now, subject to a more detailed inventory study which is going on for the whole of Nova Scotia, the fact is that our economic reserves of coal supplies in Cape Breton, with present technology, run only in the neighbourhood of some 200 million tons. For the future we can add a couple of more modern mines which will, if tied to long-term power contracts over a 15-year to 20-year period, guarantee less of the boom and bust cycle which has plagued our coal economy in the past. This will mean some help for the province, and there are other possibilities farther down the road. In the meantime, though, to argue for oil price increases on the premise of national equalization of prices does not make much sense to us in Nova Scotia or the Atlantic region.
National equalization of prices is no equalization at all if it does not take into account the serious situation in the Atlantic region and especially in Nova Scotia. We recently had a major increase in our electricity rates. When the present contract runs out with Imperial Oil in 1977, given the increases implicit in the budget we will probably surpass Prince Edward Island as having the highest power rates in this country. Surely a government that sets up a Department of Regional Economic Expansion to close disparity of income gaps is not going to let that happen. The oil price increase envisaged in this budget is a crime against the Atlantic region and especially Nova Scotia.
July 2, 1975

The other obvious economic crime against the Atlantic region implicit in this budget, beside the relatively higher increase in unemployment that the region will get as a result of this budget planning for more national unemployment to fight the cost of living, is farther down the road. I refer, of course, to the proposed amendments to the Medical Care Act which came into force on July 1, 1968. We know that since then Ottawa has contributed half the national cost of medicare. It now intends to put a sliding ceiling on its contribution by limiting the federal increase, calculated on a per person basis, to 13 per cent next year, 10.5 per cent the following year and 8.5 per cent in all subsequent years.
Consider also, Mr. Speaker, what this government intends to do with our national hospital plan. Under the Hospital Insurance and Diagnostic Services Act of 1957, the government has also paid half the national cost of hospital care. The act requires that the federal government give five years' notice before renegotiating its agreements with the provinces. This government gave that notice during budget week. Why? Because it wants to do the same thing as with the Medical Care Act-place a ceiling on its commitment. As well, it announced it will reduce by 35 per cent its payments to the health resource fund.
Our parliamentary leader asked, on June 25 in this present debate, why these things in the medical care field were being imposed on the provinces unilaterally. As he pointed out, the poorer provinces will not be able to cope. Economize as they will, the poorer provinces of the Atlantic region in the end will have to pass on the burden to the people living there. This will take the form of higher premiums, new taxes and deterrent fees and/or inferior health care. So much, then, for guaranteed equality of health treatment in this country. So much, too, for the late Lester B. Pearson's "co-operative federalism".
As we mentioned previously, the gas and oil price increases announced in the budget have caught the most attention. But as Don McGillivray of the Financial Times has recently noted, the Minister of Finance expects to take $350 million from the nation's car drivers this year, but the extra payroll tax from increasing the employees' and employers' premiums and decreasing the federal share may add anywhere from $800 million to $1 billion next year.
Mr. Speaker, there are many things to be said of this federal move announced in the budget. Time does not allow dwelling on them all, but certain implications of this move have to be well understood by the Canadian people. First of all, as is evident from what I have said, it is a large tax which could average about $90 a year for a wage earner. Secondly, it is meant to be a disguised tax. Thirdly, it is a regressive tax in that it will fall on the lower income groups and the working poor of this country with a vengeance-and that during a recession.
Little wonder that the former minister of labour, who evidently fought hard for the favourable changes in the 1971 amendments which were subsequently copied and improved by France and Germany, walked out of the House when the Minister of Finance was announcing that he was, in effect, turning back the clock as far as changes in the Unemployment Insurance Act were concerned. How pitiful, then, to read in Hansard that the minister in charge
. The Budget-Mr. Hogan
of DREE tried to defend this reactionary move by saying that the benefits have not been cut for the unemployed. Is he and other members of this Liberal cabinet, including the Minister of Labour (Mr. Munro) and the Minister of Manpower and Immigration (Mr. Andras), agreeing to a notion that the unemployment insurance scheme or the Canada and Quebec pension plans should be financed from taxes which bear most heavily on those least able to pay?
Are they party to the plan of the Minister of Finance to renege on what was promised in 1971 when more generous benefits were built into the scheme? It was then that the federal government agreed to pay all costs attributable to unemployment over 4 per cent. The federal white paper introducing this scheme said:
This policy clearly establishes the government's responsibility for the financial support of a national unemployment scheme program over and above the self-financing aspect.
Yet what did this cabinet do in the June 23 budget? It changed the 4 per cent unemployment yardstick or norm to an eight-year moving average so that this year they estimated the norm would have been 5.3 per cent. How easily the Minister of Finance can change upward the statistical full employment goal to make up for poor mismanagement of the economy. Even his friend, the Secretary of the Treasury, Mr. Simon, of the United States would not try that one. Or would he? Since so much of the philosophy of the budget evidently emanates from the thinking of conservative Republican advisers to President Ford, one wonders.
It is quite a trick, Mr. Speaker. You establish an eight-year moving average bench-mark during a recession. Presto, you assure that little or none of the cost of the main unemployment insurance benefits will fall on the federal treasury or be financed by the progressive income tax in future years. The Minister of Finance tried to camouflage all of this by talking about adjustments to unemployment insurance to create "a greater incentive to remain at work and to search more actively for a job". He implicitly leaves the impression that was rampant a few years ago, that there is a rip-off from the unemployment insurance.
It sort of has an old-fashioned ring to it-phrases like "increasing the incentive to work". It is a great way to pander to the Neanderthals who like to think that somebody like the federal minister is protecting them from those welfare bums on unemployment insurance. It is a convenient way, also, to divert attention from what you are really trying to do. I would advise the Minister of Finance and his advisers to read discussion paper No. 33 of a study by the Economic Council of Canada for the Council of Maritime Premiers. In that document there is a chapter entitled "The Effect of the Unemployment Insurance System". I will just use a short quote from the conclusion of the chapter"
The greater generosity of the unemployment insurance system has not decreased true labour force participation in the maritimes.
So much for the camouflage. No wonder, Mr. Speaker, that the leader of the official opposition referred to the budget as a cynical document. Here is a finance minister who brings in a budget that is practically a carbon coppy of the great American plan-you fight inflation by creat-
2 95 76-4214

July 2, 1975
The Budget-Mr. Hogan
ing more jobless people. Meanwhile, there is a "made in Canada" ploy. You get the workers, through a regressive tax, to pay for the unemployment you created. No wonder the Postmaster General (Mr. Mackasey) left in disgust.
Is it any wonder, Mr. Speaker, that we in this minority party are incensed? We well realize that the health and hospital insurance plans referred to previously, as well as the unemployment insurance plan, grew out of the fertile minds and experiments of the founders of the CCF and this party. Senator Madam Casgrain reminded Mr. Pick-ersgill of this historical fact last year at a conference at the University of Western Ontario which was probing Mr. King's contribution to Canadian political life. We have seen the Liberals take these ideas and build them into a compassionate welfare system that our party was proud to have originated.
This budget of the Minister of Finance of June 23, 1975, attempts to reverse this historical process. Little wonder that the backbench Liberals over there did not like our parliamentary leader pointing out that the action of this Minister of Finance turns the social history of our country upside down. It struck too close to home-or maybe they just did not understand.
So much for the late Lester B. Pearson's concept of "compassionate Liberalism". What we have now is "limited liability Liberalism". It would be a joke if it were not so tragic. We should not be surprised that a minister of finance with that philosophy would be so indifferent to the housing needs of Canadians. It is an industry that is in dire need of rejuvenation, by practically everybody's diagnosis. It is little wonder then that those who see the tremendous shortfall of housing we are going to face next year should declare, "The crisis is here and the ostrich has put his head in the sand, hoping that it will go away. Isn't he going to be surprised!"
I want to say a word about the moneys allotted in this budget for training and mobility allowances, as they affect the development of the Atlantic region. We welcome the extra $70 million put into the Canada Manpower training program. Let us hope that it will not be used to train square pegs for round holes or, worse still, for non-existent holes-meaning no jobs after training. We have had enough of that in certain areas of the Atlantic region, like Cape Breton. These programs can sometimes be used as another means of welfare; and of course trainees do not show up in unemployment statistics. Thus the full impact of the recession on the labour force can be hidden.
There is to be an extra $10 million allocated to help workers relocate through use of mobility grants. Mobility out of a region is usually a highly selective process with respect to age, skill level, and education. Recent research suggests that net out-migration does not alleviate a region's unemployment problem as much as it was once thought. A research article in the Canadian Journal of Economics of November, 1970, demonstrated that "for every five unemployed persons leaving the Maritime region, two people become unemployed."
Figures for the 1965-1974 period show how many people have been leaving Nova Scotia and Newfoundland for other parts of Canada. The same is true of New Brunswick

and Prince Edward Island, although in the case of the latter province this trend has been less pronounced because of some positive immigration in the 1970-1974 period. In the case of New Brunswick it is possible that the relatively recent high influx of temporary foreign construction workers upset longer predominant trends. Let us hope that the retraining program will help to rectify this situation.


Mr. Benjamin:: Don't bet on it.


Andrew Hogan: The Minister of Finance has played on the fears of Canadians by suggesting, with short-run, questionable unit cost comparisons, that we are losing our competitive advantages vis-a-vis the Americans. As Nathan Bossen, the Montreal based economist has noted, unit cost comparisons under conditions of fluctuating exchange rates-even leaving aside the definitional method of data collecting which has distorted wage and productivity indices by which we have measured the change in the comparative competitive positions of various countries in the last five years-show that relative changes in unit labour costs have little to do with performance in the arena of world trade.
Canadian unit labour costs have, in fact, declined marginally over the past five years and over recent months relative to the costs of our trade partners. But the minister creates a bogeyman and plays on our fears of becoming another Britain; he rejected out-of-hand the devaluing of the Canadian dollar. This, he argues, would raise the price of imports and thus fuel the desire for higher Canadian wages. He warns us that this is "the slippery slope that Britain has gone down." What a nonsensical analogy! Somebody ought to have told him that in the three months ending in May, the Canadian Consumer Price Index rose at an annual rate of 7.1 per cent. Of course his oil price policy, according to his own department's estimate, will add 1.6 per cent to the Consumer Price Index.
In my opinion, Mr. Speaker, a policy of maintaining an overvalued currency, a policy of artificially propping up the Canadian dollar with our foreign exchange fund for fear of importing inflation, is a poor exchange rate policy. The minister has shown no decisive evidence that our imported inflation is high, or would be high with a clean float. Actually, he has been arguing the reverse since November, saying that imported inflation arising from food and commodity shortages and the oil price explosion has now given way to internal wage-push inflation.
The other method of keeping up the value of the Canadian dollar is by maintaining high interest rates to attract foreign money. This foreign money creates a demand for Canadian dollars and thus holds up their value. If the government, in addition to promising financial restraint in the budget, is to impose a restrictive monetary policy through the Bank of Canada and thus allow interest rates to remain at their present high levels or even climb to higher ones, we are in for a very deep depression in this country.
The high interest rates which are necessary for maintaining the value of an overvalued currency affect Canadians as well as foreigners. They mean higher prices for our money, which is a means of exchange; these higher money costs restrict home building, apartment construction, and
July 2, 1975

non-residential construction, and thus restrict output, opportunities for employment and even price stability.
The minister has shown an excessive fear in his budget, a fear of overstimulating the economy and, ultimately, of creating more inflation. How can the Minister of Finance ignore the clear evidence showing that although the oil price increase will be inflationary, the rate of inflation is abating? Does he really want to put another 100,000 or
150,000	Canadians out of work to guarantee the abatement of inflation, and discourage many more thousands of Canadian workers from looking for work, as many will not even bother to seek employment in such a national environment?
Could not somebody in the cabinet convince him that excess demand has long since been replaced by excess supply in Canada's industrial capacity? The 7.2 per cent seasonally adjusted unemployment rate is proxy evidence of that fact. Could not somebody convince him that as we come out of this long recessionary phase of the business cycle, our productivity indices will naturally rise in our type of market economy, and that with that rise will come lower unit costs?
Are the progressive Liberals in the cabinet convinced that their fear of inflation justifies braking the recovery of the economy, to the extent of allowing between 800,000 and 900,000 Canadians to be unemployed? Mr. Speaker, to retard the spark of recovery which is now evident in our economy, as the Department of Finance is doing through this budget in the name of the war on inflation, is to say, "Let the jobless take the hindmost". It is an exercise in the economics of fear, an exercise of politics without compassion. It is immoral.


Mr. Armand Caouette (Villeneuve):: Mr. Speaker, I have to rise in this debate following the budget speech read on June 23 by the Minister of Finance (Mr. Turner). I must say I deplore the attitude of the Minister of Finance and of the government about increases in the price of oil, natural gas, gasoline and heating oil.
Mr. Speaker, within a few years, Canada will face a shortage in energy resources. We know our reserves are getting lower. This is a problem which concerns every Canadian citizen and we should take immediate steps to find solutions to that serious problem. Special attention should be given to the search for new energy sources, but the government will certainly not solve the problem by cutting down the purchasing power of Canadians or by increasing the price of gasoline and heating oil.
Mr. Speaker, heating oil and gasoline are two essential commodities nowadays, and the present increase does not solve the problem of oil. That increase will solve no problem at all. On the contrary, it will mean new problems for workers who earn less than $10,000 a year and have to drive to work. I know people who have to drive 50 or 60 miles a day to go to work and earn a living. Having a car is by no means a luxury for those people. It is just a means of earning a living for themselves and their families. People frequently have to travel to earn a living today.
Mr. Speaker, the budget provides for an increase in the price of heating oil. But let us remember workers with an
The Budget-Mr. A. Caouette
income of hardly $7,000 a year who have to provide for the needs of families of four or five children. They see the price of heating oil skyrocket from one year to the next. Heating is a necessity, not a luxury. By boosting the price of oil products such as heating oil, the government inflicts a serious prejudice on Canadian citizens and puts them in an awkward situation, since they have to heat their homes eight months a year. The government has adopted a very unfortunate attitude. It might have been much wiser to raise the cost of products which may be harmful or dangerous for the health of humans such as cigarettes and alcoholic drinks.
Mr. Speaker, the budget also provides for reductions in the growth in civil service employment while, on the other hand, providing for an employment program whose cost is estimated at $450 million over two years. Why make reductions in the sector which serves Canada, and thus reduce its efficiency, when the government claims it wants to stimulate the economy and create new jobs?
Mr. Speaker, as I was saying a few moments ago, it would have been better to increase the cost of products that are harmful to health than to jack up the price of a product such as heating oil which all Canadians need. In his budget, the minister does away with the special tax on wines; it would have been more logical to increase it. Wines are not indispensible to our development and wellbeing. It is not daily need: it is a luxury. Canada is a country where huge quantities of alcoholic beverages are consumed; considering the fact that it is the source of many social problems, it would have been more logical to tax them. Quebecers, in 1974-75, drank $361,700,000's worth of alcoholic beverages.
We are constantly told that tobacco is harmful to one's health, that it can cause cancer. Why not overtax that product? Those taxes would bring double benefits to Canadians in that they would protect the citizens' health, and generate twice the income the tax on gas and heating oil will bring in.
With regard to housing, in his budget, the minister provided for higher subsidies to housing financed by the private sector, and non-profit housing organizations.
Surely the minister is not aware of the position in which he is placing low income individuals, depriving them of privacy and forcing them to live in crammed quarters like sardines. The money would have been better spent on low cost single family dwellings. This way, it might have contributed to the well-being of low income people by giving them some sort of security and a measure of satisfaction as homeowners, with roofs of their own over their heads, and not mere square boxes with cardboard partitions. Moreover, it would have served in creating jobs.
The government might have amended the Bank Act to reduce mortgage rates and favour the construction of single family dwellings, while taking care of the forest industry which has now fallen down to its lowest point ever. Thus, contruction workers would have had the best of it, and the number of unemployment insurance and social welfare recipients would have been considerably reduced. This budget favours again the big contractors and people with higher incomes.

July 2, 1975
The Budget-Mr. A. Caouette
Mr. Speaker, as for the Local Initiatives Program, it would have been in the interests of the government to invest in it much more, to assist the municipalities to carry out some works and thus create jobs. Unemployment insurance and social welfare are quite useful in some cases, but why let so many employable persons remain idle when municipalities could make them work throughout the year? Why could they not, while receiving benefits, serve the community and for those who have lost their job redevelop a taste for work? Those are the points which the the minister should have considered and included in his budget.
Mr. Speaker, in the meantime what happens to the small wage earner? The government makes him again carry the can and then we wonder why there are so many strikes and workers are never happy. The last budget is one of the reasons. The government in its budget refrains from dealing directly with the problems of unemployment insurance. It did not even refer to them and does not tackle the waiting period. It is an undue penalty. It does not even create a more effective organization to pay more quickly the benefits to people who are entitled to them. The exclusion from three to six weeks will give cause for reflection to many of those who want to leave their job without valid reason. But what will those persons live on during those six weeks? Probably on allowances from the Department of Social Affairs, because we cannot let children starve when their father left his job without reason. The worker on sick leave after a short period of work will need 20 more insurable employment weeks to draw benefits and there will be four more weeks without benefits to disqualify people and reach the disqualification objective.
Mr. Speaker, all those things should have been studied and included in this budget for the advantage of all Canadians. The guaranteed annual income advocated by the Social Credit Party of Canada should have been a feature of this budget. For many years, Canadians have been asking for that. But nothing in this budget is for the low wage earner. Everything is against him. Nor can we see anything in this budget for the moderate income group. And given the present economic conditions and the lack of solutions in this budget, there is no indication at all for better days in the future.
No other solution is brought to inflation, to recession or to unemployment. According to the Minister of Finance, recent polls have been made. According to these polls, the majority of Canadians feel they live better now than a year ago. I wonder in which class of society these polls have been made. Certainly not among those on welfare or among senior citizens, and still less among mine workers or forestry workers.
In the end, Mr. Speaker, with this budget, the minister brings no solution to the problems facing Canadians. It is inflationary and it creates further problems for these in low income brackets. The government will not settle their problems by reducing the purchasing power of the citizens. For a long time, since its inception, the Social Credit Party continuously brings good solutions to the problems facing the Canadian people but the government turns a deaf ear. The budget brought down on June 23 is a glaring evidence of that. It is very sad for Canadians that this is a

majority government; otherwise, it would probably have had quite a surprise.


An hon. Member:: Mr. Speaker-


Mr. Horner:: Mr. Speaker-


Mr. Deputy Speaker:: Order. I have no objection to recognizing either of the hon. members, but I would draw attention to the fact that whoever speaks at this time will not be able to speak tomorrow; the question having been put, the debate tomorrow will be on the main motion. If they are content to speak for four minutes without completing the 30 minutes which might otherwise be allotted to them, I have no objection. It is their choice. On the other hand, I could call the question.


Some hon. Members:: Question!


Mr. Deputy Speaker:: Is the House ready for the question?


Some hon. Members:: Agreed.


Mr. Deputy Speaker:: The question is on the amendment in the name of the hon. member for York-Simcoe (Mr. Stevens). All those in favour of the amendment will please say yea.


Some hon. Members:: Yea.


Mr. Deputy Speaker:: All those opposed will please say nay.


Some hon. Members:: Nay.


Mr. Deputy Speaker:: In my opinion the nays have it.
And more than five members having risen:


Mr. Deputy Speaker:: Call in the members.


Mr. Speaker:: I	therefore declare the amendment lost.	
Amendment (Mr. Stevens) negatived.


Mr. Speaker:: Pursuant to	special order made in the
House on Friday, June 27, it being after six o'clock I do		
now leave the *	chair for the	House to resume at eight
o'clock this evening.
At 6.10 p.m. the House took recess.
Petro-Canada AFTER RECESS
The House resumed at 8 p.m.


PETRO-CANADA ACT MEASURE TO ESTABLISH CROWN CORPORATION
[Stage Direction]
The House proceeded to the consideration of Bill C-8, to establish a national petroleum company, as reported (with amendments) from the Standing Committee on Natural Resources and Public Works.
Mr. Speaker:: Order, please. There are four motions by way of report stage amendments. Upon examination, at least in a cursory way, motions Nos. 3 and 4 appear not to give the Chair any problems in terms of procedure. However, subject to argument which the hon. member for Calgary Centre (Mr. Andre) may want to put forward and in which other members may wish to participate, it appears, aside from whatever difficulties may exist with regard to the recommendation and the financial initiative of the Crown, that there may be a question with respect to the first two with which I may have some difficulty.
Since the capitalization remains constant in both the bill and the hon. member's amendments, that is not a problem. However, clause 3 of the bill reads:
The purpose of this Act is to establish within the energy industries in Canada a Crown owned company with authority-
To support that, clause 5 of the bill states that the capital stock is $500 million, divided as set out, and that the Crown will own all the shares. Motions Nos. 1 and 2 in the name of the hon. member for Calgary Centre seek to change that. The first motion seeks to change, not the gross amount, but the capital structure in order to give effect to the hon. member's second motion, which is to make the shares available for purchase by the public. That seems to change the very character of the corporation from a Crown owned to a public corporation.
As I said, that gives the Chair great concern, particularly at report stage. Perhaps the hon. member who has moved the motions might want to contribute something to the discussion at this point.


Mr. Harvie Andre (Calgary Centre):: Mr. Speaker, I confess that upon hearing that the acceptability of these motions might be challenged, I was somewhat surprised. I did not feel that these motions in any way detracted from the intent of the government to establish a Crown corporation. In fact these amendments were proposed from the point of view of making this Crown corporation, Petro-Canada, more similar to existing Crown corporations. Indeed that has been the thrust of most of the debate, discussion, and argument of our party during second reading and particularly at the committee stage.
It is our feeling that certain clauses of the bill make Petro-Canada resemble a branch or division of the Department of Energy, Mines and Resources rather than a Crown corporation in the context of what the public of Canada perceives a Crown corporation to be. In my humble opinion, that perception is that a Crown corporation is basically a public corporation except that the Crown owns all of the shares. As a prerogative of ownership, it is able to direct the corporation into undertaking certain ventures

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which may be to the national good and in fulfilling certain government policies.
However, it may not necessarily stand the test of profitability and so on in the same way as the privately held corporation.
In terms of some of the clauses of the bill, after some discussion in committee we were able to convince members on the other side to accommodate the point of view we were putting across, namely, maintaining a structure which the Canadian public accepts as being the appropriate structure for Crown corporations. More important, in our estimation it would be possible for this Crown corporation to be a success, and for the investment to be made by the public of Canada in this corporation to be protected.
In terms of the acceptability of these amendments, possibly the most relevant argument might arise from the definition of Crown corporation. I am not able to state categorically that this is so, but I believe the recognized definition of Crown corporation appears in the Financial Administration Act. Crown corporation is defined in the Financial Administration Act as follows:
... a corporation that is ultimately accountable, through a Minister, to Parliament for the conduct of its affairs, and includes the corporations named in Schedule B, Schedule C and Schedule D;
Included in Bill C-8 is the provision that Petro-Canada shall be appended to Schedule D of the Financial Administration Act. Therefore it will come under the umbrella of that act. We have made no motions to have that deleted. We recognize the appropriateness of this Crown corporation being under the umbrella of the Financial Administration Act under Schedule D. I will name some of the corporations which do appear under Schedule D of that act. They include such Crown corporations as Air Canada, Eldorado Nuclear, Canadian Deposit Insurance Corporation, Polymer Corporation Limited, St. Lawrence Seaway Authority, and a number of others.
To use an example of one Crown corporation, Polymer Corporation was incorporated by letters patent, the normal procedure which a private individual or group of individuals might use to incorporate a company to conduct business. In that case the shares were held by the Crown, and a decision was taken by a subsequent parliament that Polymer had reached a sufficient degree of maturity, and that in terms of the national interest it no longer seemed appropriate that all of those shares must be held by the Crown, and it seemed appropriate to that parliament that those shares, through the Canada Development Corporation, should be offered to the public of Canada.
Polymer Corporation was a Crown corporation before that decision. I believe it now belongs to the Canadian Development Corporation and is no longer a Crown corporation, although it may be through the Canadian Development Corporation. But the amendments I have proposed would do nothing more than make it possible for some future parliament more easily to take the same route in terms of making available to the Canadian public the shares of this Crown corporation as an alternative to the Crown holding these shares, an alternative which certainly fulfills the stated goals of the government. We support

those goals, although we question the vigour of the government in pursuing the policy of Canadian nationalism, increased Canadian ownership, and control of Canadian industry. Those goals could be accomplished through a similar move to that undertaken for Polymer Corporation, namely the transfer of these shares to another vehicle whereby Canadians as individuals, rather than Canadian only as citizens of the country through the Crown, could be owners.
So under the definition of Crown corporation as laid down in Part VIII of the Financial Administration Act, I would have to argue that before and after these amendments Petro-Canada would remain a Crown corporation. It is my opinion that, as a result of these amendments, it would be more like a Crown corporation as perceived by the majority of Canadians. Without being repetitious I would like to say that Canadians believe a Crown corporation basically to be a corporation the same as others, except that the shares are held by the Crown.


Mr. Speaker:: Order, please. If there is no other hon. member wishing to contribute to the point, with the greatest of respect to the hon. member for Calgary Centre (Mr. Andre) it seems to me that his argument is somewhat self-defeating. He used the example of Polymer Corporation and indicated that at one time it was a Crown corporation. Parliament later expressed the desire or the will that that situation be changed, and through the vehicle of the Canada Development Corporation, and steps taken by parliament, that status was changed.
What the hon. member is proposing by way of his amendment is to change the character of this corporation at this stage of the legislation. It may be that future parliaments may want to propose amending legislation which would change the basic character of this corporation from a Crown corporation to something which is not a Crown corporation.
In his closing statement the hon. member described what Canadian people believe a Crown corporation to be, that is, a corporation just like any other corporation except that the shares are held by the Crown.
In his amendments the hon. member proposes that the shares would be restructured in such a way as to give effect to the second amendment, motion No. 2, so as to make the shares transferable to the public; in other words, this would not be a Crown corporation, but a corporation in which the shares could be purchased by the public. That seems an inescapable fundamental variation from the principle of the bill, which is to establish a Crown corporation. To give effect to the amendments of the hon. member would mean that it would not be a Crown corporation, and I cannot think of anything which more plainly flies in the face of the principle of setting up a Crown corporation. His amendment would set up a corporation which is not a Crown corporation.
If the hon. member had proposed these amendments at second reading, I think he would have had great difficulty. If he had proposed them at committee stage, he probably would have had even greater difficulty because, while there are amendments moved to specific clauses at that stage, his amendments attack the basic principle of the bill. But to try to introduce this new concept at the report
July 2, 1975

stage of the bill seems to me not only to fly in the face of the basic principle of the bill, but procedurally to do it at a stage which is much too late in the game. If it could have been attempted, it should have been attempted at second reading, and frankly I am not persuaded at all that it would have succeeded at that stage either.
With the greatest of respect to the hon. member, who expressed his intentions clearly, it seems inescapable that the first two amendments fly directly in the face of the basic principle of the bill and, in order to confine it to its narrowest terms at report stage, they are just not procedurally acceptable to the Chair.


Harvie Andre: That Bill C-8, an Act to establish a national petroleum company, be amended in paragraph 7(l)(n) by striking out line 33 on page 5 and substituting therefor the following:
"sell or dispose of all or any part of the".
He said: Mr. Speaker, this amendment which is proposed and which Your Honour has ruled to be in order, is not much different in intent from the other amendments.


An hon. Member:: Careful.


Harvie Andre: Sometimes the niceties of procedure or the necessity for the niceties of procedure escape me. Nonetheless, I do want to have the opportunity to discuss this amendment and the reasons for my having proposed it at this time, even though it was also proposed at second reading. I suspect the fate of this amendment at this stage will be similar to that at second reading.
Try as I might to convince members who sit on the benches behind the minister of the validity of the amendment, it appears that the whip wielded by the powers that be is mightier than the ordinary powers of logic and wisdom. Nevertheless, I feel an obligation, a responsibility as a member of this House, a custodian, a trustee of taxpayers' money, to do what I can to improve this bill and enhance and protect the investment of the people of Canada.
The history of the bill is rather strange, Mr. Speaker. The first public indication the government gave that it considered establishing a national petroleum company was in the publication of a document entitled "An Energy Policy for Canada-Phase I-Analysis" in early July, 1973. Chapter 7 dealt with state participation in a Canadian energy industry, oil and gas. A number of arguments were advanced in favour of a national petroleum company and a number against it: there were ten arguments for and eight against. If one weighed the arguments with any sense of fair play, reason or logic, however, it was clear that the arguments against establishing a national petroleum company far outweighed those in its favour. On the basis of that document we concluded that a national petroleum company was not to be an element of this government's energy policy if and when one was produced. The document was supposed to be the forerunner of an energy policy that was forever going to cure all our problems of security of supply and price. We know how far the government has fallen behind on that pledge.
Petro-Canada
On December 6, 1973, for reasons that neither he nor anybody else in the government has made clear, the Prime Minister (Mr. Trudeau) announced, out of the blue, that the government had decided to establish a national petroleum company. No reason was given: it just seemed to the government to be the thing to do. I think any reasonable, unbiased observer of the political process in this country would recognize why the decision was taken. We were in a minority parliament and the then leader of the New Democratic Party, Mr. David Lewis, was making threatening noises. Something had to be done about the energy crisis or he would not support the government, and without his support the minority government would have been defeated.
The political committee of cabinet had to appease Mr. Lewis and keep him from bringing down the government, so they decided to pick the fighting ground. They recognized that Mr. Lewis, for philosophical reasons, would appreciate the establishment of a national petroleum company. They did not decide this because it was a good investment for Canadians-there is no claim for that-but they just hope against hope that it will not lose too much money. No spokesman for the government has said this is going to be a good investment for Canadian taxpayers.
Will there be increased security of supply? We hope so, but no spokesman of the government has been able to prove that will happen. So what is it going to accomplish? The main thing it was going to accomplish then was the support of the New Democratic Party for a few more weeks so that the government would not have to face the people at that time. Cabinet made the decision, and a bill was produced but not brought before the House. The election ensued, and when we returned, the government reintroduced the bill. Why? It was no longer a minority government and did not need to appease the New Democratic Party.
The government's own document under the signature of the Minister of Energy, Mines and Resources (Mr. Macdonald) shows that a national petroleum company is not necessary. I listened to the minister in the debate on second reading of Bill C-8 and hoped for some new evidence that the national petroleum company would be a good thing for the country, although the previous document had showed the contrary. As reported at page 4036 of Hansard of March 12, 1975, the minister said:
I do wish to spend some time, however, explaining to the House why this legislation has been brought forward.
I listened carefully and I have read the speech several times since, but there was not a shred of new evidence as to why a national petroleum company is necessary now. The minister made five arguments for a national petroleum company. His document has ten, and the five are out of those ten. He did not repeat the others because they were pretty weak; and, of course, he did not repeat the arguments against the company. There was no new reason advanced to show why it was required.
The bill went to committee and we expected to have the opportunity for more direct participation. We expected to hear from the minister about what had transpired, what new evidence was available to convince us that a national petroleum company was a good thing. Mr. Speaker, there was not one shred of new evidence to support or to ration-

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alize the establishment of this national petroleum company. Why, Mr. Speaker? I can put forward two reasons. First, as is very likely, there is no evidence; second, the government does not think it necessary to provide information.
Why should the minister need to appease the opposition? After all, his is the power, his whips make his boys toe the line. The government can push through whatever bills it wants; therefore, why should it bother appeasing the opposition or appeasing committee members who ask for evidence? For example, I asked the minister in committee if he had background studies relating to national petroleum corporations of other countries. Scores of them have been set up. According to our evidence, not one of them has been successful. Nevertheless, we were contradicted. We asked the minister if the department does possess background studies relating to national petroleum corporations of other countries, and could the government demonstrate to the committee the basis or validity of its decision? The minister said yes, he had a background study. When I asked him to provide it to the committee, he refused; he just said no.
Apparently, as members of parliament we have no right to ask for information which is internal to the government. Having examined it, they in their wisdom have decided and we on this side who want to look at the evidence are told we are out of line. Our duty is simply to sit in committee or in the House and vote; according to the government, our duty ends there and we have no right to expect the government to show us the evidence on which it bases its legislative plans.
I cannot accept that position, Mr. Speaker. I think we have a right to this information. I find unacceptable procedures under which the government can ask this House to approve the spending of possibly several billion dollars without giving us the basis for its decision. The government says no when we ask for information either in the House or in committee. When we wanted to know the factual basis underlying the establishment of the corporation, that information was not given to the committee. We convinced government members in committee to accept some modest and moderate amendments only after strenuous argument, only after weeks and weeks of committee sessions and only after we had been called all sorts of names. The minister's minions told their connections in the media that the Tories were filibustering, being irresponsible. Only after we had endured that could we convince the government to accept some modest amendments to this legislation, which improved it vastly.
That is a most unacceptable way for the House or its committees to operate. We are sent here as legislators, not simply as "yea" sayers or "nay" sayers, depending on which side you sit. We have the right to look at information which the government collects using taxpayers' money. We have the right to expect some accommodation to our point of view. If, in the exercise of our rights and the discharging of our obligations to our constituents, we must resort to tactics which take up an awful lot of time and are tiresome and wearisome, so be it; we will continue to do it.

If and when the cabinet are willing to be open and honest with members of the House, to provide information and acknowledge our right to have our viewpoint accommodated, we shall find that the business of the House is transacted more expeditiously than at present. Perhaps we shall not need to sit here during July. Perhaps we can transact our business at other periods of the year. This will be possible if we transact our business more efficiently and expeditiously than at present.
The government must change its attitude; it must change its views and be more accommodating. My remarks apply particularly to the minister. Hon. members opposite often talk about the necessity to reform the rules of the House. Actually, they mean that the powers of individual members should be further curtailed. I suggest that we can improve the procedures of this House if there is greater willingness for openness and honesty on the part of the government, if there is greater willingness to provide information which has been paid for by the public, and to accommodate the views of the opposition as well as the views of government backbenchers, for that matter.
The particular amendment we are discussing may not be necessary, although I think it improves the bill. The amendment seeks to amend clause 7(l)(n) in such a way that the corporation can at any time sell all or any part of its assets. The reason is this: governments in future may find that Petro-Canada is not accomplishing what it was hoped it would accomplish, or that the corporation is a disruptive force in the industry. Possibly we shall find such huge quantities of gas and oil off the east coast of Canada-which is what we all want-that the existence of this corporation, set up originally to secure Canada's longterm oil supplies, will no longer be necessary. This could happen. If it does, I hope the government of the day will act appropriately. I hope it will consider its role as that of looking after the problems which need looking after, and not that of involving itself in all sectors of the economy simply because that is its philosophy. Such a government, acting through the board of directors and executives of the Crown corporation, may decide to sell the corporate assets. Indeed, the minister said in so many words that the government was setting up this Crown corporation so that we may have the social benefit of a Crown corporation working in a field dominated by foreign-controlled corporations.
On page 186 of the energy document to which I referred earlier the following statement appears:
Perhaps the greatest advantage of an NPC is the social benefit to Canadians of the pride, satisfaction and confidence of owning a portion of the petroleum industry operating in Canada.
As I stated a few minutes ago, we on this side certainly count ourselves among those one would call Canadian nationalists in the sense that we feel it is vitally important to Canada's future that Canadians be given the opportunity to participate in the ownership and control of Canadian industry to a greater extent than is now the case. Indeed, during the last election we put forward a number of policies designed to achieve that end-I shall not cover that ground again because I have dealt with it so many times.
July 2, 1975

However, it does appear tragic to me that the Minister of Finance (Mr. Turner) in his budget the other night did not take the opportunity to remove from the Income Tax Act the "principal business test" as it pertains to the oil and gas industry, because that section of the act is more responsible for the present degree of foreign ownership of the oil and gas industry in this country than any other piece of fiscal or economic policy. Removing this one section from the Income Tax Act would go a long way to providing Canadians with opportunities to participate in the ownership of the industry in Canada.
There are, of course, a great many other things which the government could and should do, a great many sins of omission and commission on the government's part which make it difficult for Canadians to be majority owners of their own industry. If one wants to find reasons why our industries are foreign-controlled one need look no further than the policies of the government opposite which apparently has long held the view that it doesn't matter who owns what as long as they can tax it. This was their view, and it remains their view. When public pressure increases they may occasionally take some action, but usually it is action which tends to increase government rather than Canadian ownership.
Clearly it has been a political ploy all along to suggest that our opposition to the national petroleum bill makes us in some way friends of the multinational companies, that it somehow makes us anti-Canadian. It is a ploy which has been used continuously through all stages of this debate. It has, of course, no basis in fact. Indeed, the fact that we reject socialism as a viable alternative in terms of Canada's future development does not mean we reject nationalism, and I suggest that some of the so-called nationalist sentiments expressed by those on the left wing of this House are, really, a case of socialists representing themselves in the guise of nationalists in an attempt to reap whatever political support this may bring them.
At the beginning of my remarks I indicated that some accommodation with our point of view was reached during the committee stage. In particular I might mention the clause which would have required the corporation to obey every whim of the minister provided that the whim was written down rather than expressed orally. We found this to be totally unacceptable. After some weeks of discussion in committee there was accommodation to that point of view. In exchange, we agreed to a limitation of two days of debate to settle all matters at report stage and on third reading. We are now into that debate to the extent of some 48 minutes. My hon. friend from York-Simcoe will be moving another amendment later, and I know there are others on this side who would like to get their views on record.
Having said this, I shall not belabour the subject any further. I shall merely say that there have been some informal discussions and I believe it is acceptable to ourselves and members opposite, as well as to the New Democratic Party, I hope, that votes on the amendments may be taken together at the end of the two day debate.


Stanley Howard Knowles: That is the rule, anyway.
Petro-Canada


Donald Stovel Macdonald: To deal briefly with the amendment the hon. member has put forward, Mr. Speaker, Clause 7(1) (n) contains a provision which will be found generally in corporation law authorizing corporations from time to time, on the judgment of the directors, to sell or dispose of any part of their undertakings. If hon. members reflect on this they will realize, of course, that any corporation will, from time to time, be dealing with its assets, perhaps selling some in order to acquire others, so it is perfectly logical and, indeed, essential that this power should be available.
What the hon. member has proposed, however, is that the board of directors should be given authority to sell the whole undertaking of the corporation without any reference whatsoever to parliament.
Let me draw the attention of hon. members to clause 28 which provides as follows:
No law relating to the insolvency or winding-up of any body corporate applies to the corporation and in no case shall the affairs of the corporation be wound up unless parliament so provides.
Thus, were it thought advisable to discontinue the operations of the corporation the government of the day would have to go back to the House and, by proposing specific legislation, secure the right to bring the corporation to an end.
If the power which the hon. member is seeking were granted, the activities of the corporation could quickly be brought to an end without any reference to parliament; the board of directors could simply sell the whole of the undertaking. I suggest that if it were thought advisable to take such a major step in the future, after hundreds of millions of dollars had been invested in the corporation, the government of the day should be obliged by law to come back to parliament and seek, through parliament, the necessary authority. It is really because we are concerned that parliament should have the final say in any such decision that I counsel hon. members and seek the support of parliament against this particular amendment.


Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, the hon. member for Calgary Centre (Mr. Andre) has said on this report stage what he said many times while Bill C-8, to set up a national petroleum company, was before the Standing Committee on National Resources and Public Works, namely, that he sees no need whatever for setting up such a company. Certainly, the amendment that he has now proposed and the other amendment which His Honour the Speaker felt was out of order are designed to achieve that result. The present amendment to clause 7(l)(n) would allow the corporation to sell or dispose of all or any part of the undertaking of the corporation for such consideration as the corporation thinks fit. The amendment that was not allowed would have struck out subclause (3) of clause 5, which provides that the common shares of the corporation are not transferable and shall be registered in the books of the corporation in the name of the minister, and held by him in trust for Her Majesty in right of Canada. So the whole purpose of this amendment, as well as the amendment that was not allowed, is to make it possible for the national petroleum

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company, once it is set up, to be disposed of by the board of directors without any reference to parliament which set it up in the first place. If this corporation is ever going to be disposed of, then surely the only body that can make that decision is parliament. Parliament is the only body that can disestablish the corporation.
I listened very carefully this evening to what the hon. member for Calgary Centre had to say. Again he asked why a national petroleum company was necessary and expressed his view that it was not at all necessary. I should like to know whether he is speaking just for the oil industry or whether he is speaking for the Conservative Party.


James McPhail Gillies: He is speaking for the people of Canada.


Mr. Rodriguez:: He is speaking for both; they are indivisible.


Thomas Clement (Tommy) Douglas: Anyone who looks at the situation of the oil industry in this country today, Mr. Speaker, and at what it has been over the past ten years, will know why we need a national petroleum company. The real tragedy is that a national petroleum company was not set up 10 or 12 years ago. The hon. member for Calgary Centre said that he wants the Canadian people to participate, but not through public ownership. How can the Canadian people participate in an industry 90 per cent of which is today controlled by foreign oil companies? These foreign oil companies have bought out one by one practically all the Canadian companies and for decades they have been ravaging the resources of this country, exploiting the consumers of Canada and deliberately misleading governments and the public by telling them that we had adequate reserves of oil and there was no danger of our conventional oil supplies running out.
These companies, Mr. Speaker, that are now coming to the government and saying we have only enough oil to last until the early 1980s are the same companies that appeared before the National Energy Board a few years ago and declared that we had an abundance of oil and natural gas to last until the turn of the century. Therefore, they said, they wanted more permits to export oil and gas, and they received them. They have been able to exert enough pressure on governments to export 50 per cent of our daily production for the last 50 years.


James McPhail Gillies: With the permission of the National Energy Board.


Thomas Clement (Tommy) Douglas: With the permission of the National Energy Board, whom they misled in the same way as they misled the government, ably assisted, may I say, by the policy of the former Conservative government back in 1960 and 1961 which set up the Borden line through the Ottawa Valley, thereby giving to the major oil monopolies of the United States a captive market in both western and eastern Canada. The Canadian people have paid dearly for that. Now that we find we have only a few years' supply of conventional oil left, what is the oil industry doing? For the past year it has been virtually blackmailing the government to raise the price of crude oil. The industry has said, in effect, "If

we don't get more money we are going to slow down our exploration programs". The oil companies have been shifting their drilling rigs south of the line.


Peter Colwell Bawden: Of course.


Thomas Clement (Tommy) Douglas: course"-a typical Tory reply. Having exploited our oil resources, they are now going to somebody else unless we pay them more. When workers go on strike there is a great deal of fuss about what they are doing to the public. The oil industry has been on strike for over a year, with reference to exploration programs in this country. It has put a gun to the government's head and said that either it gets a higher price or it goes elsewhere. The oil industry says, "We need more cash flow"-a lovely term that it has managed to produce. In other words, the oil industry is saying it wants the consumers of Canada to pay more for oil, not because the industry is not getting enough now to do very well, but to look for oil which, when they get it will belong to them and not to the Canadian people who put up the money for exploration in the first place.
If that is not reactionary economics, Mr. Speaker, I do not know what is. But that is the cry now: we must give the oil companies more money so they can find oil that will belong to them, and for which we will have to pay through the nose in order to get it.


Peter Colwell Bawden: Now tell us what you did in
Saskatchewan.


Thomas Clement (Tommy) Douglas: Mr. Speaker, I would be glad to tell my hon. friend about that and also to tell him about the companies that are going south of the line to drill for oil instead of drilling for it in Canada. The tragedy is that the government has taken so long to recognize the need for taking the necessary steps to bring some measure of public ownership and control over the petroleum resources and petroleum industry of Canada.
Now that the government has recognized the necessity for taking this step-belatedly, it is true-we in this party support it, as have supported it from the very time that this legislation was introduced. However, I point out that my concern is not whether we are going to have socialization of the oil industry; my concern is whether this national petroleum company is going to have any effective role to play in Canada. What is it going to do? What is its function going to be?
Let me make three points that give me concern, points that I am sure will concern a great many Canadians. I hope that when the minister speaks, either in this debate or on third reading, he will tell us something about these matters. First, I noticed in the press that Mr. Hampson, president of the Canada Development Corporation, has said that if his corporation cannot buy an oil exploration company, they may set up their own oil exploration company. I would be interested to know if that is government policy. If that activity is to be carried on by the Canada Development Corporation, what is to be the role of the national petroleum company, or are they both going to be engaged in oil exploration? I think that needs to be clarified.
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The second thing which disturbs me is the statement made by the Minister of Finance (Mr. Turner) in his budget, in which he talked about cutting back on the capital expenditures of Crown corporations. I hope the minister will tell us, if not now at least on third reading, how much money is to be made available to the national petroleum company. Is it going to be a substantial amount? Under the act it is allowed $500 million in common shares, and allowed to borrow up to $1 billion. If the government is going to reduce the amount of money made available to Petro-Can in this fiscal year, then what useful function will Petro-Can be able to perform?
The third concern I have is in respect of what promising areas are available to this national petroleum company. Certainly south of the 60th parallel all the promising areas are already in the hands of the multinational oil companies. In the Arctic the major oil companies already have permits and leases in respect of the most promising areas, and the same is true in respect of some of the promising areas which are offshore.
I know the minister will say that the national petroleum company will be able to go into joint ventures. That will be a very good move. This will enable some small Canadian companies, by going into joint ventures with the national petroleum company, to expand, grow, and carry out exploration work which they could not otherwise do. But these small companies do not have the most promising areas. They do not have the oil and gas potential areas the large corporations have, and my fear is that the national petroleum company will simply be a birddog looking on the periphery for oil that someone else is going to develop.
I have no quarrel at all with the bill. It gives to the national petroleum company very wide powers and functions. The company may explore for oil, it may produce oil, it may transport oil, it may refine oil, and it may distribute oil and petroleum products. It has wide powers on paper, but unless it has areas that are potentially promising in oil and gas supplies then it is going to be little more than an empty gesture.
I want to see this national petroleum company succeed because I think it is the only hope Canadians have of getting some control of the petroleum industry in this country, and the only hope of having an opportunity to develop the resources which, in my opinion, belong to the people of Canada and not to any foreign controlled oil company. That will only be done if the government is able to get into areas where there is oil and gas.
I will hazard a guess now for the minister that if he is not prepared to do it in the near future some government will be compelled by the circumstances in a few years to take over one of the major oil companies, thereby getting control in order to buy up and take over from these companies the oil and gas fields, the refineries and the pipelines, so that Canadians for the first time will have some control of their own affairs in respect of exploration, production, and refining of petroleum products.
I am sure the minister is not prepared to go that far now, but I am convinced that, if not this government, some other government will be compelled to go that far, because the Canadian people will not be satisfied to have hundreds
Petro-Canada
of millions of dollars spent merely birddogging for the large oil companies, merely working on the periphery of the oil exploration picture, and merely going through the gesture of being an oil company when really it will have no economic effect whatsoever as far as the Canadian consumer is concerned. If this petroleum company is to be worth anything at all the government has to get into this all out, not on the periphery, but into the very centre of the oil and gas industry, and to do it under public ownership so the Canadian people will get the benefit of the development of resources which rightfully belong to them.


Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, I should like to say a few words in support of the amendment of the hon. member for Calgary Centre (Mr. Andre). I think the statement by the minister in his budget that he was cutting back on the allocation to Petro-Can signifies the real value the government places on this legislation.
This legislation comes at a time when the industry is highly controlled, and it is doubtful what the government can hope to accomplish that cannot be controlled now through existing legislation. The oil in the ground belongs to the provinces. No matter which company drills for the oil, including I presume Petro-Can, the oil will still belong to the individual province. The province in turn can regulate the industry. It can tell the operator how much oil to take out, and can regulate the flow. The province also sets the royalties and so on in respect of the oil production.
We have just passed a law which allows the federal government to set a price in respect of oil which crosses interprovincial boundaries. The federal government can set the price which it feels is reasonable to the industry as a whole. We all know that as a result of the budget the price of oil at the wellhead has been increased $1.50 a barrel. Surely that is an indication of the power of the federal government to control the movement of oil inter-provincially as well as into export markets. The government can do this through the National Energy Board, and the federal government can certainly decide what profits the oil companies will take. Finally, the provincial government of a consuming province has the right to set the price at the gas pump, or at the commercial outlet for heating oil.
As has been suggested in the budget, the government can set the taxes, including corporation taxes, so that undue profits do not accrue to the oil companies. Therefore, it is hard to see at this time what will be the value of this petroleum company.
The minister has never been very clear about what he envisages this company to be. Should it be another Air Canada taking over 80 per cent or 90 per cent of the activities of the oil industry, leaving only a small fraction for the private companies, or should it be a small company in comparison to the major oil companies? As I understand the structure of this company at the present time, it would be equivalent in size to four or five other companies which already exist in this country.
So as envisaged at the moment, this is still a long way from a takeover of the industry. What rights will this company have? Will it be able to confiscate oil produced

July 2, 1975
Petro-Canada
by other companies? Will it be able to drill holes wherever a company has been fortunate enough to find oil? What this company will be able to do, only time will tell. Perhaps only the directors and the government of the day will make the decisions about the extent of the activity of this national oil company.
It has often been mentioned that the Ottawa Valley line created a great hardship for Ontario consumers. Looking back on it, I suggest perhaps it was not a good idea but I am sure it ensured for the vast bulk of the people of Ontario oil which otherwise may not have been available. Since Ontario depended on offshore oil, this created a severe balance of payments deficit, and the price of oil in Ontario and Quebec would have been much higher and the government possibly would not have been able to institute a lower, two-price system for oil had this policy of long ago not been implemented. [DOT]
The people of the west certainly appreciate the fact that $500 million extra in respect of oil is not much compared to the enormous amount of money involved in tariffs to build up the Canadian industrial sector. We must also remember, when it is stated that the oil industry has overemphasized its reserves, that one of the great consuming provinces of the country, Quebec, until it saw that the price of oil would become too high did not show much interest in western Canadian oil. I certainly could agree with that position. Why should the people of Quebec have paid a higher price for western oil when they could get it offshore at a lower price?
We must also realize that the increase in respect of natural gas was 15 per cent while in fact the total energy increase in respect of gas and oil was 4.5 per cent or 5 per cent. I think these figures are forgotten. It should also be remembered that much of our balance of payments problem stems from the fact that we are not selling much oil south of the border. Obviously, the amount of money taken in from our sales to the south has decreased enormously. In 1974, the sale of hydrocarbons produced something like $3.8 billion as opposed to $1.8 billion in 1973, even though the volume was even less in respect of exports than in 1973.
Will we find enough oil to export, or will we be faced with the fact that we will have to cut back? Will we be faced with ever greater costs in relation to oil, particularly for the portion of the country lying to the east? I suggest that the value of this corporation is extremely doubtful now and that many years will pass before any judgment can be made concerning how valuable it is.


Mr. Sinclair Stevens (York-Simcoe):: Madam Speaker, if I may have a few moments to comment on the amendment before us, moved by my colleague the hon. member for Calgary Centre (Mr. Andre), I would just like to say that while my colleague's amendment is perhaps rather technical in that it simply proposes that the words "all or" be inserted in the clause now before us, I feel it is relevant to point out that I believe certain true attitudes have been smoked out both on the government side and on the part of the New Democratic Party caucus.
During the committee stage with regard to this bill, it was very interesting to watch the performance of the Minister of Energy, Mines and Resources (Mr. Macdonald)

and the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas). One might say that if the Minister of Energy, Mines and Resources is the father of this legislation, certainly the hon. member for Nanaimo-Cowichan-The Islands is the godfather. Anything that was missed by the Minister of Energy, Mines and Resources concerning the true concept of Petro-Can was very quickly clarified by the hon. member to whom I have referred.
Tonight we find, once again, that the hon. member for Nanaimo-Cowichan-The Islands has risen to stoutly defend Petro-Can and indicate that he feels it is a desirable thing. He says that he is satisfied with this corporation and then takes another rounder at the foreign ownership in this industry. As capable as he is at political speeches, he states a few facts with a few falsehoods.
What I find most amazing, however, is that one of the purposes of Petro-Can is said to be that the government wants to learn more about the petroleum industry. To that end, the government states it is willing to plow $1.5 billion of public money into an educational program. I would remind the minister and the hon. member for Nanaimo-Cowichan-The Islands that we have two entities in the transportation field in this country which are publicly owned. We have the CNR and Air Canada. Yet we have the Minister of Transport (Mr. Marchand) repeatedly telling us that the entire transportation policy is in a mess. He offered us a policy of sorts the other day which he said he hoped would help, but if I get any impression from sitting in this House, it is that this government knows less about transportation in this country than about virtually anything.


Jean Marchand: What is your policy?


Sinclair McKnight Stevens: Madam Speaker, transportation is a field in which the government actually has two active Crown corporations. What happened to the educational program in respect of transportation? In fact, if we follow the minister correctly concerning these two corporations, he knows virtually nothing about the CNR or Air Canada. When the minister is questioned in the House concerning those corporations, either in detail or in general, repeatedly we are told that because they are Crown corporations the information is not available, it is privileged or it cannot be given for some other reason. The truth is that Petro-Can is a socialistic dream. They have conjured up in their minds the impression that the petroleum industry is not owned by Canadians but is owned by foreign corporations. That is not in accordance with the facts. Canadians own the petroleum in this country. This is entirely different to what the hon. member for Nanaimo-Cowichan-The Islands and the minister have been telling us so far tonight.
In dealing with this amendment, I might say I was very surprised to hear the rationalization or justification given by the minister as a reason the government will not support my colleague's amendment. In my opinion, it was a specious reason. The Minister, in effect, stated that it would be a horrible concept to insert the words "all or" because it would then mean that the corporation could sell the entire enterprise and that somehow or other it would affect clause 28, the winding-up provision in the bill. He referred to that provision and pointed out that Petro-
July 2, 1975

Canada, if incorporated, may not be wound up unless parliament so provides.
The two clauses have no direct relationship whatsoever. Surely the minister does not expect us to accept his argument at face value. Hon. members should read the clause he feels is so properly worded. It states that the corporation has the power to sell or dispose of any part of the undertaking of the corporation for such consideration as the corporation thinks fit. There are no minimum requirements.
The corporation can sell 99.9 per cent of whatever it has at any time under the power given to it by subclause (n). Clause 28 would not come into play if it did that. For the minister to tell this House that while the corporation can sell 99.9 per cent of its undertaking, it would be totally intolerable to allow the corporation to sell all its undertaking, is, I say, just specious.
The minister is a lawyer. He comes from a reputable law firm. As he indicated, this clause or something comparable to it is often found in private corporations or in other types of corporations.
The minister will have to agree that the customary wording is much more in line with the wording of my colleague. In short, it is better draftmanship. I am surprised that with a bill that lacks so much the minister would not be more willing to accept better draftsmanship, such as that being suggested by my colleague. The truth is that there is absolutely no difference in the impact of these two clauses. It is a very technical argument that the minister is relying on to justify his opposition to the amendment suggested by my colleague.
I urge hon. members to support the better wording suggested by my colleague, the hon. member for Calgary Centre.


The Acting Speaker (Mrs. Morin):: Is the House ready for the question?


Some hon. Members:: Question.


The Acting Speaker (Mrs. Morin):: Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


The Acting Speaker (Mrs. Morin):: All those in favour of the said 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 nays have it.
And more than five members having risen:
Petro-Canada


The Acting Speaker (Mrs. Morin):: Pursuant to Standing Order 75(11), the recorded division on the proposed motion stands deferred.


Sinclair McKnight Stevens: Motion No. 4.-That Bill C-8, An Act to establish a national petroleum company, be amended in Clause 22
(a)	by striking out line 34 at page 15 and substituting therefor the following:
"determine,
and any amount so advanced by way of loan or purchase shall bear interest at a rate that is not less than the rate approved by the Minister of Finance for that quarter of the year in which such amount is advanced as the standard rate of interest for loans to Crown corporations that are repayable within a period not exceeding twelve months".
(b)	by striking out lines 41 to 43 inclusive at page 15 and substituting therefor the following: "option of the corporation".

He said: Madam Speaker, if I may have the indulgence of the House, I would like to give some background on why I believe this is a very important amendment to be included in the bill in its present form. I refer hon. members to clause 5, which reads:
Subject to sections 22 and 25, the authorized capital of the Corporation is five hundred million dollars divided into one hundred common shares of the par value of five million dollars each.
In short, it is contemplated by the minister that the common shares of this corporation will be worth $500 million. That being the authorized amount, presumably it will be the issued amount of capital. We then turn to clause 22 on page 15 of the bill where we find, and I quote:
(1)	Subject to section 23 and upon the recommendation of the Minister and the Minister of Finance, the Governor in Council may, when so requested by the Corporation, from time to time authorize the Minister of Finance to advance to the Corporation, out of the Consolidated Revenue Fund, amounts
(a)	by way of loans on such terms and conditions as the Governor in Council may determine; or
(b)	by way of purchases of preferred shares to which may be attached such rights, restrictions, conditions or limitations as the Governor in Council may determine.
(2)	The authorized capital of the Corporation is increased by the amount of any preferred shares issued pursuant to this section.
(3)	All preferred shares issued pursuant to this section shall be redeemable at the option of the Corporation but they need not bear any stated rate of dividends or be cumulative with respect to dividends.
Clause 23 reads:
(1) The aggregate of
(a)	the principal amount outstanding of debentures or other securities guaranteed under section 21, and
(b)	the amount outstanding of loans or preferred shares under section 22
shall not, at any time, exceed one thousand million dollars.
If you read these clauses together, and I believe it is important that members understand this, the corporation may not have only $500 million worth of common share capital, it may have in addition $1 billion of preferred shares. Those preferred shares need not have any dividend attached to them. For that matter if, instead of having preferred shares, the Crown decides to have debt obligations from this corporation, the net result would be the

July 2, 1975
Petro-Canada
same. There does not have to be any interest attached to the debt.
The bill contemplates the corporation having in common shares, debt or preferred shares, $1.5 billion of public funds. However, there is nothing requiring one nickel of interest, dividend or other payment from the corporation to the treasury of Canada.
Think of the magnitude of the sums with which we are dealing. If $1.5 billion were put out with interest at 10 per cent, in today's market it would yield $150,000,000 per year. If we allow this corporation to go through, we may find this minister or his successor will put that amount of capital into this corporation, if he can work it out with the Minister of Finance (Mr. Turner) and the balance of the cabinet. That capital may have no interest, dividend or other charge on it. The net result is that Petro-Canada can in effect lose $150,000,000 a year and, as far as the balance sheet is concerned, it would appear as though it were breaking even. That is the net effect of what would happen if this corporation were allowed to be capitalized as contemplated in this bill.
We are dealing in terms of $500 million of common shares and $1 billion worth of preferred shares without any dividend connected to them. We should compare that to the capitalization of certain other Crown corporations. The Bank of Canada gets by with about $5 million of capital. Air Canada gets by with something like $25 million worth of capital. Most other Crown corporations have comparable amounts of capital. Why does this corporation need to have favoured terms such as contemplated in these clauses? For example, the Farm Credit Corporation has roughly $1.5 billion outstanding in loans. The bulk of that money is received from the treasury and in turn the Farm Credit Corporation has to pay approximately 7 per cent to the treasury for its use. If the same concept were followed in the Farm Credit Corporation as the minister wishes us to accept for Petro-Can, the net result would be that the Farm Credit Corporation would be making loans to the farmers of Canada virtually interest free.
In view of that, surely we must ask ourselves why Petro-Can should be put in that favoured position. Why should it have access to $1.5 billion free of charge when other Crown corporations are required to pay the going rate? Hon. members will note the wording in our amendment; we are simply saying that whatever the advances are, be they preferred shares or debentures, they should bear the going interest charge which is set by the Minister of Finance from quarter to quarter during the year. That is all we are asking for, and frankly I think it is something the minister should be more than willing to accept. If it is the intention of the government that there be a charge, and if this is being set up, why should the government object to having it put in the bill? I believe this is a very convenient way for the government to cover up a situation which will be a loser from day one.
I have referred to the Farm Credit Corporation. One could refer to many other corporations.


An hon. Member:: What about the Bank of Canada?


Sinclair McKnight Stevens: The hon. member refers to the Bank of Canada. As I have stated, the Bank of Canada has $5 million in capital and it seems to be getting along all right in its relationship with the Minister of Finance.
Let us consider the Federal Business Development Bank. That is a corporation which has to pay the going rate for the money it receives from the treasury. If it did not have to pay that going rate, the small businessmen of this country, in theory at least, could obtain loan accommodation from the Federal Business Development Bank at approximately half the interest charge they are now having to live with.
CMHC is another example of a corporation with relatively small capital but which receives its funds through debt instruments from the treasury and pays the going rate. If CMHC did not have to pay any interest charge to the federal treasury, and if it were put in the favoured position which is contemplated for Petro-Can, the average rate of interest paid on CMHC mortgages, as far as Canadians are concerned, would be about 20 per cent less than it is today. These facts form the background of the reason we believe that the amendment we are proposing is fair. If the government insists on capitalizing this corporation with $1.5 billion, surely as a minimum it should be agreed that those funds would have to bear a comparable rate of interest to other Crown corporations which are active at the present time.
To justify this amendment to hon. members opposite, and particularly to the minister, I would like to touch on this mythical $1 billion of so-called savings which the government is trying to convince the Canadian public is being made between the November budget, the estimates and the budget of June 23. It is a mirror game, and certainly the President of the Treasury Board (Mr. Chretien) confirmed that today when he brought in some detail which he said outlined and described the actual $1 billion which he felt had been reduced from expenditures. If one were to review what the minister indicated, some interesting facts could be found. First, the actual amount he proposes to reduce with regard to Petro-Can is $40 million. I find that very strange because the President of the Treasury Board, when asked in committee whether there was any amount included in the current fiscal year estimates for Petro-Can, told us, first, that he did not know and, second, that he did not think so. The Minister of Energy, Mines and Resources gave a like response; he was not sure whether any amount was included in the current estimates. The Minister of Finance (Mr. Turner) did not know whether anything was included for Petro-Can in the current estimates. In short, in committee we were told that it was not likely that there was anything included in the current fiscal year estimates for Petro-Can.
On another line of questioning, the Minister of Energy, Mines and Resources in the energy committee stated that he did not anticipate there would be more than $1 million needed with respect to Petro-Can in the current year for its activation. What is this $40 million which is pulled out of the air? Where did it come from? I suggest that there never was $40 million agreed to at any time. The fact is that it was some figure which was suggested during a planning stage with respect to the future spending plans of the government, and the government conveniently
July 2, 1975

latched on to it, as it did with other ministers' resquests, in order to give the impression that somehow it is cutting back.
Certain members on the government side may feel that that is a proper course and that it is not deceit, but surely there is no other word for it. It is a straight mirror game; it is a pretence. The fact is that this government has failed to control its expenditures. Expenditures in this country are out of control, and the government did not have the courage to come to the Canadian people on June 23 and make clear the full extent of its lack of control.
There is one thing we in this House can accept, and certainly if there are any betting members in the House I think they could take very low odds: the budget and the estimates as presented by the President of the Treasury Board and the Minister of Finance will be greatly exceeded when we see the true facts some time between now and the middle of 1976.


Some hon. Members:: Hear, hear!


Sinclair McKnight Stevens: Dealing again with Petro-Can, the free use of money and the $1.5 billion which is being contemplated, I think it is interesting to review the fact that in an earlier committee proceeding the President of the Treasury Board gave us a list of the various Crown corporations which would receive funds either of a non-budgetary nature or in amounts to come under general loan authorizations. That list included Atomic Energy of Canada, $200 million; CIDA, $231 million; Transport, mainly the airports revolving fund, $194 million; CNR, $210 million; CMHC, $238 million; Farm Credit Corporation, $320 million; CMHC, $600 million; Export Development Corporation, $400 million. No reference is made to Petro-Can. At that stage it had not even been contemplated that Petro-Can should be capitalized in the current fiscal year. I mention this because I think it is important that ministers and members realize how little planning goes into the creation of these Crown corporations.
At committee stage, the minister was unable to give us any precise details as to when the $1.5 billion would be put into Petro-Can. All we could get was a vague suggestion that about $500 million would probably go in during the first five years. When asked why he wanted the $1.5 billion at the present time, there was no satisfactory answer. I think we should review certain other Crown corporations this government has fostered and, I was going to say, allowed to fester. Hon. members will remember the Federal Mortgage Exchange Corporation which had top priority in the last parliament. We were told that the entire mortgage industry in Canada was awaiting this corporation. We did not oppose it. We felt the corporation could have some merit. When we examined the then minister of urban affairs about what he had in mind for the corporation we were dismayed at the lack of planning. They could not give us any five year plan, or even a one year plan. The fact is, the corporation was incorporated but it is sitting on the shelf and we cannot get an answer as to why the Minister of Finance will not give the green light and allow it to be activated.
Petro-Canada
The housing industry is in a dreadful slump, and the corporation that was formed to assist it has not been activated. In spite of the fact that there has been no previous reference to any capitalization of the Federal Mortgage Exchange Corporation we find that $75 million of the $1 billion so called cut back happens to be in that corporation.
With that kind of background surely it is prudent that this House insert in the bill a clear, mandatory requirement that if $1.5 billion is to gc into capital from public account, it must bear a proper rate of interest back to the treasury.


Some hon. Members:: Hear, hear!


Sinclair McKnight Stevens: Without that we would be in the ridiculous situation I have stated where a Crown corporation may be losing money every year up to $150 million, yet the government will be able to claim that it is breaking even. I think it is doubly important that we take exception to the minister's suggestion. If other Crown corporations catch on to this dodge they will all be asking for this kind of capitalization. Already Air Canada and CNR have talked about their debt load. We will find that they will ask to be 100 per cent capitalized free of charge by the government, and that will cause so much misspending that we will regret the precedent that is being set tonight if this amendment is not accepted.
I hope that members, and the minister in particular, will accept this amendment and, if not, will give a satisfactory explanation why Petro-Can should be allowed to use $1.5 billion in public funds without it being mandatory that it pay a going interest rate on those funds.


Donald Stovel Macdonald: Madam Speaker, the hon. gentleman's amendment and speech are one of the areas where the technique in committee was to raise a question which would be responded to again and again, and still at the end the hon. member would claim that I had not replied to his question.
I am happy to have an opportunity to put on record my response to the financing of Petro-Canada. The basic response is that we think that a national petroleum corporation should be financed like every other petroleum corporation with the substantial amount of funds being put forward in risk form by way of capital, that it should be put forward in equity form rather than loan form, and that the corporation should have liberty through a variety of financial instruments whether by common shares, equity in preferred shares, with limitations set forth, or various kinds of lending instruments from the governor in council. On that basis we think that Petro-Canada, like every other petroleum corporation, should have a full range of financial instruments to draw on for the various kinds of activity in which it may engage.
The hon. gentleman says that nobody could point out in the estimates where there was an appropriation for Petro-Canada. Madam Speaker, the bill is an appropriation for Petro-Canada; it does not appear in the estimates. That is the purpose of the bill.

July 2, 1975
Petro-Canada


Mr. Woolliams:: That is nonsense. I have never heard anything like that.


Donald Stovel Macdonald: On that basis the government and the Minister of Finance (Mr. Turner) must provide out of cash requirements of the government for a corporation of this kind, and did provide the sum of $15 million during the current fiscal year-which has been reduced to $10 million as a result of the decisions taken by the President of the Treasury Board (Mr. Chretien) and supported with respect to this corporation and other Crown corporations.
The hon. member has put forward an amendment which would inhibit the powers of the national petroleum corporation in a way that the powers of a private petroleum corporation are not inhibited. For example, the kind of investment that this corporation will engage in is that which a private corporation would fund by way of risk capital.
The best example I can put forward is the $300 million the government has contributed to the Syncrude transaction. We have a great deal of difficulty finding out where the official opposition stands with regard to that. One minute they seem to be for it-the government of Alberta is for it, the government of Ontario is for it-the next minute they are against having the federal presence in the petroleum sector. There is a little confusion with regard to that transaction.


Some hon. Members:: Hear, hear!


Donald Stovel Macdonald: One thing that is quite clear is that the federal government has made a commitment over the next several years to put $300 million into the Syncrude transaction. For this purpose it is natural that the corporation should be looking to the federal treasury for equity funds in some form. I suppose it is possible to stipulate a rate of interest with regard to common shares-I suppose one could say in response to that: what particular sense is there in it? The hon. gentleman, who was the proprietor of a bank at one time, would know that from time to time it is appropriate for investment institutions to put out funds not at any fixed rate of interest or return but on an equity basis, the equity being risk capital, and if there is a financial return it will yield a return to the investor, and if there is interest he will not get a return by way of dividends.
We are saying that Petro-Canada, like every other petroleum corporation in Canada, should be on the same basis. It should have capital either by common, preferred, or lending instruments as the case may be.
Let me deal with the specific terms of the amendment. The hon. member talks about the standard rate of loans to Crown corporations. It is virtually impossible to establish that because a variety of rates is applied by the treasury and, of course, with the various corporations that are in the position of being Crown corporations.
Even on the face of the amendment it has no meaning, no clarity. For that reason, because we think the treasury from time to time in its management of the public debt should have the same freedom of action that any private lender should have, because we think the management of this corporation in managing the funds it acquires by

equity or borrowing should have the same freedom of action, because we think that the corporation should have the same ability to engage in risk ventures such as exploration by way of equity, I would ask the House to defeat this particular amendment which would defeat the underlying purpose of the bill. That purpose is to enable federal public moneys to take part in the kind of risk venture in the public interest, the kind of risk venture like Syncrude, which is entirely an equity investment. It is a project in which there is no certainty of return but which is indubitably, in the view of the government, a project in which we ought to invest. We are investing in this project and creating the corporation which will assist in the development of the mineable tar sands. For these reasons, I ask the House to defeat the hon. gentleman's amendment.


Eldon Mattison Woolliams: Madam Speaker, I am happy to follow the minister because I represent a Calgary constituency and Calgary, as most people in Canada will accept, is the oil capital of Canada.
The minister's arguments were strange and fallacious. What are we talking about? We are talking about the government's providing $1.5 billion interest-free to the proposed company. This money is in addition to the stock of the company. The minister's arguments make me wonder about his legal training. He comes from the firm of McCarthy and McCarthy of Toronto which has produced some great lawyers for Canada. I do not know if he finished articling before he came to the House of Commons. At any rate, he was called to the bar but it is my guess that he did not spend much time practising corporate law.


An hon. Member:: A question.


Eldon Mattison Woolliams: Does the hon. member who calls for the question support the idea of an interest-free loan?
Let us get down to brass tacks. The minister of Finance (Mr. Turner) said in the budget speech that the government intends to cut expenditures by $1 billion. I think hon. members would give more credence to the government if it dropped Petro-Canada; we could believe its claim that it intends to save $1 billion of taxpayers' money.
Let me recite some of the history of our oil industry. By 1946, when Leduc No. 1 first produced oil, Imperial Oil had drilled 133 dry holes which cost almost as much as we are putting into Petro-Canada. Afterwards, one field after another was discovered in western Canada until today Canada is the only western country self-sufficient in petroleum.


An hon. Member:: Thanks to federal initiatives.


Eldon Mattison Woolliams: The hon. members says, "Thanks to federal initiatives." I suggest otherwise. The hon. member for Qu'Appelle-Moose Mountain (Mr. Hamilton) will support me when I say that drilling rigs left Saskatchewan and went to Alberta because the economic climate in Alberta was right: Alberta's policies rewarded those who risked capital in the finding and developing of petroleum. Now Canada is self-sufficient in petroleum.
July 2, 1975

Not long ago the Minister of Indian Affairs and Northern Development (Mr. Buchanan), speaking in Calgary, was commenting on rules and regulations governing land leases in the Arctic and the north. He said, "Of course, if you find pools of oil and fields of natural gas we shall pass regulations favouring Petro-Can." We need to be assured that Canada will favour policies which will maintain our self-sufficiency in energy. This kind of legislation is nothing but a disguised tax, because under it the government will take the taxpayers' money and give it to the corporation; but you will not see effective exploration and development of the north. Remember what happened in Saskatchewan: the drilling rigs left the province to work in other areas. If a privately-owned oil company strikes oil, the government company will step in-the company that is financed with an interest-free loan raised on the backs of taxpayers. That company will take over the development of favoured fields in the north.
The North Sea development has been carried out differently. For the first time in its history, the United Kingdom is to be self-sufficient in oil. Ships have brought oil to Britain from the North Sea and in five years that country
Petro-Canada
will be self-sufficient in petroleum. But the British government has given what it calls international oil companies incentives. Yes, even the socialist government of . Great Britain has given international oil companies incentives for exploration and development. But what has the Canadian government done? Drilling rigs are leaving the country. How can we compete for international, risk dollars when we set up a company with an interest-free, $1.5 billion loan for the very purpose of competing with private companies? That is what will happen.
I see it is almost ten o'clock, Madam Speaker, and I will finish my speech tomorrow. Let me say one more thing: this tax is worse than the added ten cents a gallon on gasoline. If it does anything, it will make sure that Premier Davis is re-elected with a Conservative government in Ontario. May I call it ten o'clock?


The Acting Speaker (Mrs. Morin):: Order, please. It being ten o'clock, pursuant to the order made on Friday, June 27, 1975, this House stands adjourned until tomorrow at 11 o'clock a.m.
At 10 p.m. the House adjourned, without question put, pursuant to Special Order.

July 2, 1975


APPENDIX &quot;A&quot;
[Stage Direction]
Grants &
Capital Contributions Program (Millions of Dollars)

[Stage Direction]
Canadian Dairy Commission Multipurpose Exhibition Facilities Farm Credit Corporation

[Stage Direction]
Professional & special services
Canadian Overseas Telecommunication Corporation
ENERGY, MINES AND RESOURCES Energy research and development Dominion coal blocks Electrical interconnections Saskatchewan coal studies Alberta mineral coal study AECB-grants to TRIUMF Petro Canada AECL-Gentilly Plant
-Tort Hawkesbury

[Stage Direction]
Small craft harbours
Defer replacement of " Wm. J. Stewart"
Institute of Ocean Sciences, Patricia Bay Fishing vessel subsidies
Development of pollution abatement technology
Public Service staffing delegation
Salmon enhancement program
Oceans policy implementation
Aquaculture-fish farming
Fish health inspection (program)
Flood mapping
Additional resources for fleet operation EXTERNAL AFFAIRS
Grants and Contributions to international organizations Passport fees
Canadian International Development Agency
INDIAN AND NORTHERN AFFAIRS Indian Affairs capital Indian Affairs operation Parks
Mackenzie Highway
Eastern Arctic Gas Pipeline Study
Pan arctic
INDUSTR Y, TRADE AND COMMERCE Travel Industry Development Tourism advertising
PAID, DIP, etc.
Credit grain sales Grain storage
Federal Business Development Bank JUSTICE
Grants and contributions
MANPOWER AND IMMIGRATION Training improvements Manpower Training Community Employment Strategy Immigration Appeal Board
NATIONAL DEFENCE Capital
14.0
.2
.5
.2
.3
2.5
10.0
1.0
1.0
2.0
30.0
7.0
3.3
2.0
3.0
1.5
1.0
1.1
4.0
2.0 .5 .3
1.0
3.4
1.0
3.0
1.0
13.2
8.0
35.8
1.0
.5
3.0
8.5
.5
NonBudge tary
2.5
20.0
2.9
40.0
30.0 4.0
12.0
135.0
10.0
[Stage Direction]
July 2, 1975
Grants &
Capital Contributions Program (Millions of Dollars)

[Stage Direction]
Total		34.0	15.0
NATIONAL REVENUE			.2
Port closings			
PRIVY COUNCIL OFFICE			
Institute for research in public policy		1.0	
PUBLICS WORKS			
Capital expenditures	10.0		3.0
Lease expenditures Alaska Highway reconstruction	3.0		
			
SCIENCE AND TECHNOLOGY			
General program reduction			.3
SECRETARY OF STATE
[Stage Direction]
Special development projects-bilingualism General program reductions-Citizenship
[Stage Direction]
4.0
[Stage Direction]
1.0
[Stage Direction]
Workload increases-Citizenship Other grants and contributions
[Stage Direction]
4.5
[Stage Direction]
2.3
[Stage Direction]
Voluntary Organizations CBC-General program reductions
[Stage Direction]
.7
[Stage Direction]
2.0
[Stage Direction]
-Capital reductions
[Stage Direction]
3.0
[Stage Direction]
Museums-Grants NFB-Film productions
[Stage Direction]
1.0
[Stage Direction]
1.0
[Stage Direction]
SOLICITOR GENERAL
[Stage Direction]
Staffing for two medium security institutions Capital expenditures RCMP-VIP protection
[Stage Direction]
7.9
[Stage Direction]
3.6
[Stage Direction]
SUPPLY AND SERVICES
[Stage Direction]
Interior design and furniture
[Stage Direction]
1.6
[Stage Direction]
TRANSPORT
[Stage Direction]
General reductions Training institute
[Stage Direction]
3.0
[Stage Direction]
13.0
[Stage Direction]
Two Heavy icebreakers
[Stage Direction]
5.0
[Stage Direction]
Reduce capital expenditures-Air Airport security program
[Stage Direction]
15.7
[Stage Direction]
.5
[Stage Direction]
Reduce capital expenditures-Surface Railway relocation Reduce cash-Airports Revolving Fund CNR-Rail line construction in B.C. NHB-Reduce cash requirements
[Stage Direction]
10.5
[Stage Direction]
12.0
[Stage Direction]
URBAN AFFAIRS
[Stage Direction]
Operating expenditures
[Stage Direction]
1.0
[Stage Direction]
Urban Demonstration Project
[Stage Direction]
4.0
[Stage Direction]
CMHC-Housing research and community planning
[Stage Direction]
2.0
[Stage Direction]
-Granville Island
[Stage Direction]
2.0
[Stage Direction]
-Mortgage application fees
[Stage Direction]
2.5
[Stage Direction]
-Acquired real estate and public housing -Reimbursement of Administrative costs -Corporation projects
[Stage Direction]
6.0
[Stage Direction]
5.0
[Stage Direction]
Federal Mortgage Exchange Corporation
[Stage Direction]
NCC-National capital Fund
[Stage Direction]
4.0
[Stage Direction]
-Defer land purchase
[Stage Direction]
VETERANS AFFAIRS
[Stage Direction]
Reduce capital expenditures
[Stage Direction]
5.0
[Stage Direction]
GENERAL
[Stage Direction]
Granting councils Salaries-man-year reductions and special controls
[Stage Direction]
6.0
[Stage Direction]
60.0
[Stage Direction]
Other reductions
[Stage Direction]
120.0
[Stage Direction]
45.0
[Stage Direction]
Non-
Budgetary
3.9
15.0
5.0
6.0
5.0
75.0
5.0
101.4
254.9
249.7
357.4
[Stage Direction]
Thursday, July 3, 1975