1975-05-14

ROUTINE PROCEEDINGS


Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I rise on a matter of urgent and pressing necessity pursuant to the provisions of Standing Order 43, involving the bankruptcy of an organization called the Society for the Study of the Heritage of Canada which is being investigated by, among others, the hon. member for Kootenay West (Mr. Brisco), some of whose constituents are affected; he is presently in Toronto pursuant to this matter. As large sums of money are involved as well as government departments, and as very reputable persons have been involved as advisers from various fields of endeavour, including athletics, entertainment, parliament and Air Canada, and they probably have been deceived, I move, seconded by the hon. member for Okanagan Boundary (Mr. Whittaker);
That the Secretary of State, or the Minister of Consumer and Corporate Affairs immediately take the same course of action as their colleague, the Minister of Transport, and cause an investigation to be commenced, and report to the House at the first opportunity.


Mr. Speaker:: Order, please. The motion is proposed pursuant to Standing Order 43 and requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


INDIAN AFFAIRS
Miss Flora MacDonald (Kingston and the Islands):: Mr. Speaker, under the provisions of Standing Order 43 I request the unanimous consent of the House to move a motion of pressing and urgent necessity. Given that the government has admitted that its present policy on native housing is a costly failure and since native people were not adequately consulted at the time the program was devised, I move, seconded by the hon. member for Gren-ville-Carleton (Mr. Baker);
That any revised policy for native housing be not implemented without full consultation and agreement in principle with the National Indian Brotherhood and the Native Council of Canada.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: Order, please.



FISHERIES


Mr. Jack Marshall (Humber-St. George's-St. Barbe):: Mr. Speaker, I rise on a third motion under Standing Order 43, to present a matter of urgent and pressing necessity. I am sure the House will recognize its importance and give unanimous consent. It has to do with prices being offered to lobster fishermen by buyers in the Atlantic region. Prices vary by as much as 150 per cent. This places the fishermen at the mercy of the buyers, who are evidently combining to take advantage of the fishermen.
As the price of $1 per pound being offered in Newfoundland does not even cover the basic costs of the fishermen, I move, seconded by the hon. member for St. John's West (Mr. Carter):
That the government direct the Department of Consumer and Corporate Affairs to investigate the matter under the Combines Investigation Act and that, if such practice is confirmed, the buyers be charged with unfair practices, or ordered to pay fair prices in line with market demand.


Mr. Speaker:: The motion is proposed pursuant to Standing Order 43 and therefore requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



PRESENCE IN GALLERY OF PRESIDENT OF THE REPUBLIC OF UPPER VOLTA, HIS EXCELLENCY GENERAL EL HADJ ABOUBAKAR SANGOULfl LAMIZANA

Mr. Speaker:: Before commencing with the question period, may I call the attention of the House to the presence in our gallery of a very distinguished visitor, His

Oral Questions
Excellency, General El Hadj Aboubakar Sangoule Lamiza-na, President of the Republic of Upper Volta.


Some hon. Members:: Hear, hear!



ORAL QUESTION PERIOD


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, may I ask either the Prime Minister or the Acting Secretary of State for External Affairs for a little more information about reports saying that United States Air Force aircraft have attacked and possibly destroyed Cambodian naval vessels in the Gulf of Thailand. Has either hon. gentleman any information to give the House?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, I have no information on this. Perhaps the Leader of the Opposition will direct his question to the Secretary of State for External Affairs, who is expected back in the House in a few minutes.


THE CANADIAN ECONOMY
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, may I direct a question to the Minister of Finance concerning the revelation that output in the Canadian economy for the first quarter of this year declined by some 2.8 per cent, or, averaged over the year, at the rate of 11 per cent. Since this is the third quarter in a row in which there has been either no increase in output in Canadian economy, or a decline, will the minister inform the House if he intends to bring forward specific measures which will help in what is clearly a major recessionary period?


Hon. John N. Turner (Minister of Finance):: Without accepting the preamble of the hon. member's question, Mr. Speaker, a proper response would be on budget night.


John Edward Broadbent: Mr. Speaker, I somewhat suspected that answer. I wish to direct my supplementary question to the Minister of Industry, Trade and Commerce since a good part of the responsibility for this totally unacceptable situation in the Canadian economy must reside with him. Apart from budgetary matters, can he inform the House what his department plans to do to reverse this unfortunate situation?


Hon. Alastair Gillespie (Minister of Industry, Trade and Commerce):: Mr. Speaker, this year we probably have the most impressive list of foreign trade initiatives that

the government has ever put forward. We have more outgoing missions than at any time in the past. We have more incoming missions. I will be meeting with the French minister, the Iranian group, the German minister, and a very large delegation from Russian within the next six weeks. We are participating in, and I will check this figure, better than 100 separate fairs and missions abroad. We are trying to develop exports in both our traditional and non-traditional markets.


Some hon. Members:: Hear, hear!


John Edward Broadbent: Apart from incoming and outgoing missions, can the minister inform the House of one, and I do not ask for more, concrete program the government has embarked upon on which he can give us information as to an increase in sales or leading to an increase in productivity in the Canadian economy?


Alastair William Gillespie: Mr. Speaker, on a very recent mission to Cuba and Venezuela, we signed $25 million worth of business in Cuba and $25 million worth of business in Venezuela. We identified very close to $1 billion worth of potential business. The hon. member may recall that last week I signed a $500 million line of credit with the U.S.S.R.


Some hon. Members:: Hear, hear!


Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, I have a supplementary question for the Minister of Industry, Trade and Commerce. As the measures which the minister has been outlining to the House for the past three years have produced in the last 12 months two periods of zero growth, a third quarter with a decrease of 1.3 per cent and the final quarter, which we have just gone through, with a decrease of 2.8 per cent, will the minister tell the House what he is going to do in the near future in the way of introducing really effective measures, as the measures he has been adopting and is proposing at the present time have not done anything to improve the economy in any way, but have depressed it considerably in the past 12 months.


Mr. Speaker:: Order, please. That kind of question lends itself to debate, discussion and argument. I think it ought to be avoided so that we will not get into any long-range
discussion.


George Harris Hees: As we were given exactly the same kind of meaningless promises before each of the last three budgets, namely, that the government intended to bring in measures to stimulate the economy, and since the economy has continued to decline-


Some hon. Members:: Question!


George Harris Hees: -can we expect something better this time or will the same kind of fiasco be produced when the minister brings down his budget in June?
May 14, 1975


INFLATION-REQUEST FOR STATEMENT ON RESULTS OF MEETING WITH BUSINESSMEN SEEKING CONSENSUS ON RESTRAINT
Mr. James Gillies (Don Valley):: Mr. Speaker, my question, too, is directed to the Minister of Finance. Can the minister tell us the results of his meeting this morning with an undoubtedly distinguished though unidentified, group of Canadian businessmen?


John Napier Turner: The
names may not be known to the hon. gentleman but they were made public; I invite him to go through the names to see what a representative group of businessmen they were. I was accompanied by my colleagues, by the Minister of Labour, by the Minister of Regional Economic Expansion and by the Minister of Industry, Trade and Commerce.


Mr. Baldwin:: Worse and worse!


John Napier Turner: We had a good general review of the proposals in the working papers which the government has distributed to various sectors of the economy. Suggestions were made by the business leaders for improvements to these papers. Universal concern was expressed by the meeting about the state of the economy if we are not able to get prices and competitive costs under control. We discussed a wide variety of options which might be available to the government as remedies for the situation. I think my colleagues and I were generally encouraged by the positive tone of the meeting and by the willingness of the business leaders to continue these discussions.


Some hon. Members:: Hear, hear!


INFLATION-REACTION OF BUSINESSMEN TO POSSIBLE IMPOSITION OF WAGE AND PRICE CONTROLS
James McPhail Gillies: During the course of the discussions was the issue of compulsory controls touched upon and, if so, what was the response?


John Napier Turner: No general proposition to that effect was put forward. As I say, a wide range of options and remedies was discussed.


James McPhail Gillies: Given the fact that it is generally conceded to make a program of compulsory controls work, there has to be confidence that the people responsible for them support them and favour them. If the government should opt for some compulsory program, would the Minister of Finance feel both morally and intellectually obliged to resign?


John Napier Turner: That is a hypothesis loosely constructed on the basis of another hypothesis, a question I have no chance of answering.


INFLATION-INQUIRY AS TO GUIDELINES PRESENTED TO BUSINESSMEN DURING MEETING SEEKING CONSENSUS ON RESTRAINT
Mr. James A. McGrath (St. John's East):: When the hon. gentleman met with the representatives of organized
Oral Questions
labour, he put forward suggested guidelines within which organized labour was to operate as an exercise in voluntary restraint. May I ask the minister what guidelines he presented this morning to the representatives of the business community?


John Napier Turner: I do not
want to adopt the vocabulary of the hon. member, but the proposals and working papers before the meeting this morning were the same as those tabled in the House last week.


FINANCE
Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, I would like to put a question to the Minister of Finance.
In view of the fact that the number of loans made by the Industrial Development Bank has been drastically reduced over the last few months, would the minister tell the House whether he is ready to recommend a lowering of interest rates in order to entice industries to take advantage of that legislation, thus helping to relieve the serious unemployment problem?


John Napier Turner: Mr. Speaker, the matter of interest rates has been clarified very recently by the Governor of the Bank of Canada. In principle, we are somewhat affected by international rates. It is also obvious that the problem raised by the hon. member will be clearly dealt with in the next budget.


Joseph Adrien Henri Lambert: Mr. Speaker, I should like to ask a supplementary.
I thank the minister for his very earnest answer. The situation being serious and urgent, will more beneficial measures than those we now have be brought before Parliament in order to stimulate further the development of small businesses in our country, which employ at least 60 per cent of working Canadians? Since small businesses are facing financing problems and are sometimes forced to borrow at usurious rates, would the minister be prepared to introduce measures likely to give them the benefit of loans at interest rates in line with their possibilities and their return?


John Napier Turner: Mr. Speaker, the answer about the fiscal and monetary aspects will necessarily be given in the budget. As for small businesses, especially those having between 10 and 100 employees and which, as the hon. member said, account for 60 per cent of jobs in Canada, the government takes a particular interest in them. When the last budget was introduced, we raised the exemption amount from $25,000 to $50,000 for the special rate granted those businessmen, as well as the gross amount, from $400,000 to $500,000, and I subscribe to the principle on which the hon. member's question is based.

May 14, 1975
Oral Questions


METHOD OF RESOLVING PROBLEM OF HIGH INTEREST RATES
Mr. Andre Fortin (Lotbiniere):: A supplementary question, Mr. Speaker.
Would the hon. Minister of Finance explain to the House how he can say, on the one hand, that there is no way he could limit the interest rate increases on housing and industrial loans, because they are international woes, and claim, on the other hand, that his forthcoming budget will settle this problem?
How can he explain that his budget will bring a solution to an international problem, if this is really one? Or can he assure the House that this time his budget will serve the interests of Canadians, rather than those of foreign countries?


John Napier Turner: Mr. Speaker, this question is so very well put together that it deserves a longer reply than I could make this afternoon. But perhaps I will say a few words about this during my budget speech.


FEDERAL BUSINESS DEVELOPMENT ACT
Mr.   J.-J. Blais@Nipissing: Mr. Speaker, my supplementary question is addressed to the Minister of Industry, Trade and Commerce. In view of the fact that, notwithstanding the lowering of the number of loans made through the IDB in the rest of Canada, in northern Ontario there has been an increase in loans, and in view of the opportunities for lending to small businesses, would the minister indicate when the Federal Business Development Act will be implemented and proclaimed?


Alastair William Gillespie: Mr. Speaker, I expect it will be proclaimed on July 1.


HARBOURS
Mr. J. M. Forrestall (Dartmouth-Halifax East):: Mr. Speaker, my question is for the Minister of Transport and arises out of a question I asked yesterday respecting certain loans incurred by the Maritime Employers' Association in connection with their operations in the river ports. The minister indicated yesterday that he might be in a position to inform the House whether or not the Maritime Employers' Association had come to the government seeking some relief under their obligations to the National Harbours Board and whether or not, at the same time, the Maritime Employers' Association had given the government any indication whether or not they were able to meet their commitments to the banks, or at least that portion of their commitments to the banks for which the government has issued guarantees.


Hon. Jean Marchand (Minister of Transport):: Mr. Speaker, at the end of the afternoon yesterday I thought I would have some information. I do not know what the situation is at the moment, but what I heard this morning was that they were still negotiating with the banks and National Harbours Board to see how the MEA can operate and meet its obligations. As soon as I have the information, I will be ready to communicate it to the hon. gentleman.


EXTERNAL AFFAIRS
Robert Lorne Stanfield: Mr. Speaker, I should like to ask the Secretary of State for External Affairs whether he is aware of reports that United States aircraft have destroyed a Cambodian naval vessel in the Gulf of Thailand, and can he give the House any information in this regard?


Hon. Allan J. MacEachen (Secretary of State for External Affairs):: Mr. Speaker, I have just been made aware of these reports which apparently have been confirmed by United States authorities, but we have not had an opportunity to study the details of the incident in order to make any thoughtful comment on the situation. It would be possible after we have informed ourselves and given the matter some thought to make some comment. Obviously, this is a matter of concern.


INQUIRY AS TO WHETHER CANADA INFORMED PRIOR TO ATTACK ON CAMBODIAN NAVAL VESSELS BY UNITED STATES AIRCRAFT
Robert Lorne Stanfield: Mr. Speaker, was the government of Canada advised officially that these measures would be taken before they were taken or at the time they were being taken, and did United States authorities give the government of Canada any explanation as to the reason for the action or the scope of it?


Allan Joseph MacEachen: Mr. Speaker, I have just made inquiries since I came into the House on this point. When I have some information I will be happy to give it to the House. Up to the present time my only information is that I understand the State Department has confirmed to us that this action has been taken. I would have to ask for further details when I have the opportunity in order to provide effective information.
May 14, 1975


AIR TRANSPORT
Mr. Jack Murta (Lisgar):: Mr. Speaker, in light of confirmation by the minister that the air lines have been involved over the past while in fixing fares, and noting that the air lines have been working together for several months preparing their case for the hearings presently going on before the CTC while interested parties have only had some 30 days to appeal, will the Minister of Transport urge the President of the CTC to reverse his decision and comply with the request of the Consumers' Association in the four western provinces to postpone the hearings for two or three weeks until the provinces and the Consumer Association of Canada have more information to present to the hearings?


Jean Marchand: Mr. Speaker, the only thing I did was intervene in order to have certain fares decreased because they really were too high, and the air lines accepted that decrease in a certain number of fares. If somebody wants to appeal the decision of the CTC there is a procedure to do so under the law. It is not my responsibility to do so, but rather the responsibility of other organizations.


Jack Burnett Murta: Mr. Speaker, in view of the fact that the organizations involved in the appeal feel they have not sufficient time to prepare a proper brief, and since the annual report of Air Canada, which contains financial information that is required by the provinces and other interested parties, was only tabled last week, will the minister personally intervene in order to allow a fair hearing in respect of this whole matter of air fare increases?


Jean Marchand: Mr. Speaker, if I am given any evidence that someone is interested in appealing the decision of the CTC, and the only problem is one of time, perhaps then I could intervene and ask the CTC to extend the time until they are ready. Up to now, the only one who has spoken to me about this is the hon. member.


AIR CANADA
Mr. Ray Hnatyshyn (Saskatoon-Biggar):: Mr. Speaker, in view of the fact that the Minister of Transport was successful in his intervention in respect of the proposed increases on short routes in the golden triangle, that is Montreal, Ottawa, Toronto, will he now use his good offices to ask Air Canada if it is prepared to withhold its application for an increase, particularly in view of the disclosure today that the golden triangle rates are riding on the backs of and at the expense of prairie rates in western Canada? I wonder if the minister would ask Air Canada to wait until we get equalization of rates based on cost as opposed to this structure we now have.
Oral Questions


Jean Marchand: Mr. Speaker, this method and this law has existed now since 1968. There is a procedure that has been established. It has been recognized by this House and never contested. I do not say we will not propose an amendment because I think there are some shortcomings, but I am not ready to do it at this moment.


FINANCE
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, my question is directed to the Minister of Finance. It is a repetition of the question I asked the Prime Minister on Monday. In view of the decline of industrial output in this country I should like to ask the minister now if he could explain the reason for the four and one-half month delay in the tabling of the final report on the tax concessions to the manufacturing and processing industries. While he is on his feet, in addition to informing us why there is that delay can he tell us when that report will be tabled?


John Napier Turner: Mr. Speaker, I am sorry I was not in the House to handle that question on Monday. The additional time taken to complete the final report on the corporate tax measures review has been due to a number of factors. I think I told the House earlier that the originally intended mailing date for the second and final survey of the Canadian manufacturing and processing firms was postponed because of the election last summer. We did not think it was appropriate to send out those questionnaires at that time and so they were not mailed until after the election. I have already conveyed that to the House. This later mailing did cause a further delay in that in many cases these firms were unable to respond as quickly as they might have otherwise due to shortage of key personnel who were on summer vacation after the election. More recently additional time has proven necessary to complete all the additional analyses which the committee wished to carry out for the purpose of the final report. The report is now in its final stages and I am advised the committee expects the report to be ready for tabling within a month.


Mr. Speaker:: One supplementary by the hon. member for Yorkton-Melville.


Lorne Edmund Nystrom: Mr. Speaker, I should like to ask the Minister of Finance whether or not he can tell us if he expects that report to demonstrate the effectiveness of the tax concessions in creating employment or whether or not he can tell us that that might not be the reason for the report being delayed as we have heard in our party from this department.


John Napier Turner: Mr. Speaker, the question is posed in cynical terms, and I could not reply to it except by saying that it will be tabled within a month.

May 14, 1975
Oral Questions
Then the hon. member is free, as he always is, to draw his own conclusions.


PUBLIC SERVICE
Mr. Lloyd Francis (Ottawa West):: Mr. Speaker, I have a question for the Minister of Supply and Services. Would he please tell the House when arrears of pay and current increases in pay negotiated in the settlement of March 19 of the strike of the general labour and trades group will be paid?


Hon. Jean-Pierre Goyer (Minister of Supply and Services):: Mr. Speaker, in fact, every department must forward to my department the payroll in order to allow the issuance of cheques. Now, it is a complicated task since approximately 21,000 employees are involved and they are paid according to certain varying rates and are working within different sectors within which rates vary too. The collective agreement has changed the definition of sectors, which complicates the task further.
It has been said, when the collective agreement was signed, on March 28, that it would take 90 days to issue the cheques. But, as a matter of fact, I can inform the House that the tradesmen will be paid according to the new agreement: 5,000 will be paid on May 16 and others on May 30. As for retroactive payments, most of the employees will receive their cheques around May 30, and others around June 28.


TRANSPORT
Mr. Lloyd R. Crouse (South Shore):: Mr. Speaker, I wish to direct my question to the Minister of Transport. Yesterday I asked the minister if the three-year contract awarded to J. P. Porter Limited, McNamara Company Limited and Marine Industries Limited by his department on August 30, 1971 in the amount of $20,860,000 was identical in value to the estimate prepared by his officials covering the removal of some 14 million cubic yards of material at lie d'Orleans and the minister promised to make this information available to this House after he checked with his officials. Has he now checked or investigated this matter and was the estimate of the departmental officials for this work identical to the amount of the contract awarded to the three companies in the joint venture.


Jean Marchand: Well, without checking the contract itself, I should say I was told that probably the hon. gentleman is about right, that there is a coincidence between the two amounts. Perhaps the hon. gentleman would be kind enough to give me time 
to re-check. I did not do it last night. I just checked the Hamilton case and the Toronto case. The hon. member can read the answer in Hansard.


Lloyd Roseville Crouse: Mr. Speaker, will the minister make this available to us as soon as he has checked?


Jean Marchand: I have no objection to it.


THE CANADIAN ECONOMY
Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, my question is directed to the Minister of Finance. As Federal Reserve Chairman Burns in the United States has indicated to Congress that the money supply in that country will increase by only 5 per cent to 7 Vi per cent in the current year has the minister received any similar assurance from the Governor of the Bank of Canada that our money supply increase will be similarly restrained, and if so has he conveyed this commitment to those he meets in his consensus talks?


John Napier Turner: Mr. Speaker, the hon. gentleman put this type of question to the House before. Over the whole 12-month period ending March, 1975, the increase in the money supply series has been 12 per cent, M-l, a figure which appears to be within the range that is reasonable in the circumstances in terms of the nominal growth of the economy.


Sinclair McKnight Stevens: I have a supplementary, Mr. Speaker. In line with the minister's consensus talks and in view of his speech in Sarnia in which he pointed out to labour that its share of the gross national product had jumped up to 54.9 per cent as of the last quarter of 1974, would the minister indicate whether he believes labour is receiving a fair share of the gross national product of this nation? As this figure has increased fairly steadily since 1963 to the 55 per cent level, does he now feel that it should be capped out?


John Napier Turner: Mr. Speaker, that question is posed in the wrong terms. It depends very much on the state of the economy, our productivity and our standard of living at the time.


Mr. Speaker:: A final supplementary by the hon. member for York-Simcoe.


REASON FOR MINISTER'S REFUSAL TO APPEAR BEFORE COMMITTEE
Sinclair McKnight Stevens: Mr. Speaker, since during May the minister has met with labour and business representatives in Ottawa and other centres, and with the Sarnia-Lambton Liberal Association, would he indicate why he has declined an invitation to appear before the Committee on Finance of this House, in spite of the fact that every available day and time was offered to him for his appearance.
May 14, 1975


John Napier Turner: Mr. Speaker, I have appeared before that committee on four occasions in the last two months, including two appearances just before I left for the Middle East. I think, despite the invitation of the committee at the moment, that the traditional discretion left to the committee and the Minister of Finance prior to the budget should be observed. When that budget is over, I will be back and I hope the hon. member shows up from time to time.


SUGGESTED STUDY BY SOLICITOR GENERAL OF COMMON ASSAULTS OCCURRING DURING HOCKEY GAMES
Mr. Arnold Malone (Battle River):: Mr. Speaker, I should like to direct a question to the Solicitor General. In view of the fact that Canada's hockey season is now drawing to a close will the minister endeavour to establish a study to ensure that starting next year there will not be a continuation of common assault taking place on the ice that we would not allow outside the hockey arena.


Mr. Speaker:: Order, please. I have serious reservations concerning whether that question comes within the administrative competence of the Solicitor General.


ADMINISTRATION OF JUSTICE
Mr. Perrin Beatty (Wellington-Grey-Dufferin-Water-loo):: Mr. Speaker, my question is also for the Solicitor General. It concerns the law enforcement intelligence unit, a co-operative international police data bank, that has about 19,000 files on Canadians and Americans in its computer. May I ask the minister, in light of the fact that several Canadian organizations, including the Department of Manpower and Immigration, the Ontario provincial police and the Toronto and Montreal police, are members of the LEIU, has the Canadian government investigated the allegations by the Houston police department that LEIU has been spying on legitimate businessmen and other citizens with no links to organized crime or subversive groups, and can he assure that the allegations by the Houston police department are without foundation?


Hon. Warren Allmand (Solicitor General):: That is a very specific and detailed question to which I will get the answer from the RCMP.
Oral Questions


ENVIRONMENTAL AFFAIRS
Mr. Donald W. Munro (Esquimalt-Saanich):: Mr. Speaker, I would like to put a question to the hon. Minister of the Environment.
Has she been made aware of the information from the West coast of the United States, whereby Shell intends to establish a new refinery at Anacortes in the State of Washington. That refinery would be supplied with Alaskan crude oil, thus requiring increased shipments across the Juan de Fuca Strait by large tankers, which would therefore create further threats to the environment?


Hon. Jeanne Sauve (Minister of the Environment):: Mr. Speaker, I think that the hon. member goes beyond the statements of the said company which has submitted a report on a number of alternate sites for a reloading port for supertankers. In fact, it has been decided that the port in question would be the most suitable for those kinds of activities. There is no intention at all for the time being to build a harbour there. Should such a decision be taken or even contemplated, we would object quite strongly.


Donald W. Munro: Mr. Speaker, I have a supplementary. Does that mean that the minister does not intend to protest in advance?


Jeanne Sauvé: Mr. Speaker, it is difficult to protest when no serious intention has been expressed of really going ahead with the construction of the port.


PUBLIC SERVICE
Mr. Wally Firth (Northwest Territories):: Mr. Speaker, I have a question and a supplementary to ask of the President of the Treasury Board and it is in relation to the current labour dispute of the federal nurses. Does the minister accept and support the concept of parity with nurses working under the jurisdiction of the provinces, and is he aware of the fact that a contract is now being negotiated on behalf of nurses in Nova Scotia which would be retroactive to January 1 of this year, thereby destroying any basis for parity for federal nurses before it is granted?


Hon. Jean Chretien (President of the Treasury Board):: Mr. Speaker, I said before in the House that this was a unanimous report and the union representative on the Conciliation Board agreed with the other two members, after studying all the facts, that this package should be accepted for all the nurses across Canada. The federal nurses represent only two per cent of all the nurses. So far as the supplementary question is concerned, the answer is no.

May 14, 1975
Oral Questions


Mr. Speaker:: Now that the hon. member has the answer, would he put the question?


Walter (Wally) Firth: Mr. Speaker, it seems to me that I should not give too much notice of the questions I wish to ask.
My supplementary question is whether the minister has considered paying nurses on a national scale rather than a regional scale to bring the department's pay practices for this group in line with almost, if not all, other groups in the Professional Institute? I thank the minister for the answer.


Joseph Jacques Jean Chrétien: Mr. Speaker, I will give the proper answer.

No, Mr. Speaker.


TRANSPORT
Mr. Walter Baker (Grenville-Carleton):: Mr. Speaker, I should like to direct my question to the Minister of Transport. In view of the statements that have been made over the past three years, and continued negotiations with respect to the establishment of a national urban transportation development corporation, can the minister let the House know when that corporation will be established and when an announcement will be made on that matter?


Jean Marchand: Mr. Speaker, I think the creation of this corporation is not only the responsibility of the federal government which will be only one of the shareholders of that corporation. Ontario has agreed to use its own corporation and to extend it nationally; Alberta already agreed, and so did many provinces. Quebec has not agreed as yet, and here in Ottawa we have not yet given any formal answer.


Walter David Baker: Can the minister assure the House that negotiations with respect to that subject are being carried on, and is it a fact that the difficulty in establishing the corporation is, as he said, that the province of Quebec has not yet agreed?


Jean Marchand: I think the Minister of Industry, Trade and Commerce met his counterpart in Quebec city and I think they found grounds for an understanding so that Quebec can come in. But the negotiations are not yet concluded because we are discussing among ourselves how the federal government will participate in this corporation.


AIR CANADA
Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, my question is for the Minister of Transport. Can he verify that Air Canada spent $273,000 overhauling each of the eight of the 24 retired Viscount aircrafts and are now considering a bid of $44,000 for each of the overhauled aircraft, and will the minister report the results of his investigation to the House?


Jean Marchand: Mr. Speaker, I can ask for a detailed report. The only thing I know is that Air Canada has many problems selling the Viscounts which they have been repairing in Winnipeg. I do not say that the aircraft cannot be sold because of having been repaired in Winnipeg.


Some hon. Members:: Better not say that.


Jean Marchand: The difficulty lies in the fact that the market for this type of aircraft is very tight and it is difficult to sell them.


A. Daniel McKenzie: Can the minister also check into the report that Air Canada is offering to sell the Viscounts to "Wings of Hope", a Montreal based charity organization operating mercy flights to Peru, and will the minister verify if Air Canada has cancelled this offer and, if so, for what reason?


Jean Marchand: I hope that some day employees in Winnipeg will be able to give me information as well as the hon. member on what is going on in Air Canada. However, I will check what the hon. member said and I will try to find someone who can provide me with the information.


INDIAN AFFAIRS
Mr. Howard Johnston (Okanagan-Kootenay):: Mr. Speaker, my question is for the Minister of Indian Affairs and Northern Development. After the recent forced closure of the Indian Affairs Office at Vernon, British Columbia, can the minister give the House any indication of the present status and future plans for that office?


Hon. Judd Buchanan (Minister of Indian Affairs and Northern Development):: Mr. Speaker, the indication to us from the various bands being served from that office is that they felt they could get along quite happily without its services. Therefore, in agreement with the request of the Indian people being served by the office, we closed it.


Howard Earl Johnston: I wonder by what means the minister has ascertained whether that was the decision of the people being served. However, I would like to ask whether all Indian Affairs offices in the country are as vulnerable as the one at Vernon, or have some been designated by the department as essential?
May 14, 1975


J. Judd Buchanan: Mr. Speaker, the means of verification was the communication we had with all the bands through their chiefs in the area. They replied in the affirmative that they would like to see the office closed. So that is our present situation.


HOUSING-REQUEST FOR ASSURANCE OF CONSULTATION WITH NATIVE PEOPLE ON NEW POLICY
Flora Isabel MacDonald: Mr. Speaker, my question is for the Minister of Indian Affairs and Northern Development. Given that the government admitted in a cabinet document on April 4 that its native housing policy is a costly failure, a fact directly attributable to the lack of input to that program by the native people, would the minister give a commitment that he will not force any new housing policy on the native people which they feel it would be impossible to implement and which does not have their agreement in principle?


J. Judd Buchanan: Mr. Speaker, I think the hon. member is aware that the native people did, in fact, have input into that paper. They prepared a study which they presented to us a year ago and there have been ongoing consultations, the last one last week, with members of the National Indian Brotherhood Housing Committee and officials in the department.


Flora Isabel MacDonald: A supplementary question. Because the lack of adequate housing is one of the major social problems facing the native people, will the minister see that far more effort is made than there has been to date, to develop a program which relates to the culture and needs of the native people rather than to the dictates of CMHC?


J. Judd Buchanan: Mr. Speaker, that is the reason we are currently having these meetings with the native people.


BILINGUALISM
Mr. Andy Hogan (Cape Breton-East Richmond):: Mr. Speaker, my question is for the right hon. Prime Minister. On Friday, May 9, 1975 the Moncton Times reported Senator Louis Robichaud, former Liberal premier of New Brunswick, as saying that the passing of Bill 22 in Quebec to make French the official language could be interpreted as a refusal to accept the Official Languages Act. Would the Prime Minister please comment on whether he agrees with Senator Robichaud's conclusion?


Mr. Speaker:: Order, please. Surely, the hon. member realizes that he is seeking information on the interpretation of a statute. One supplementary question.
Oral Questions


Andrew Hogan: Could I ask the Prime Minister if the Senator was in any way interpreting government policy in this matter?


Mr. Speaker:: Order, please. The hon. member for Brandon-Souris.


NELSON RIVER POWER PROJECT-GOVERNMENT VIEW ON USE OF EQUIPMENT MADE IN CANADA AND TABLING OF CORRESPONDENCE IN MANITOBA LEGISLATURE
Hon. W. G. Dinsdale (Brandon-Souris):: My question is for the Minister of Energy, Mines and Resources. Could the hon. gentleman inform the House whether the government of Canada is still carrying on negotiations with the province of Manitoba in connection with the supply of long-distance power transmission equipment for the Nelson River power project? If so, is the federal government's emphasis placed on Canadian content and the establishment of a plant in the province of Manitoba to provide this equipment?


Hon. Donald S. Macdonald (Minister of Energy, Mines and Resources):: Mr. Speaker, there is no specific negotiation under way as there was in the past with respect to the extension of the Nelson River system. It is anticipated that there will be further discussion as further extensions of the system are planned, but the Manitoba government has decided to go ahead on its own now. As the hon. member will recall, if the bid with the highest Canadian content had been accepted by Manitoba hydro there was the prospect not only of more jobs in Canada but of the establishment of the plant at Brandon. I believe, as a result of the Manitoba decision, that plant will not go ahead at Brandon.


Walter Gilbert Dinsdale: A supplementary question. Is the federal government withholding its approval of the tabling of documents on this subject in the Manitoba legislature?


Donald Stovel Macdonald: No, sir, we are happy to table exchanges in this regard. What we asked Manitoba to do was table additional documents so that the full record would be out in the open.



EXTERNAL AFFAIRS


Mr. Douglas Roche (Edmonton-Strathcona):: Mr. Speaker, my question is addressed to the Prime Minister. In view of United States Secretary of State Kissinger's statement yesterday that the United States is prepared to deal with the raw materials question "with economic realism, political imagination and understanding for the concerns of the developing world", what steps will the Prime Minister take to secure United States support for the position taken by the Commonwealth heads of govern-

May 14, 1975
Oral Questions
ment in Jamaica that "a comprehensive and inter-related program of practical measures" including trade and monetary reform, be drawn up to close the gap between the rich and the poor nations?


Pierre Elliott Trudeau: Mr. Speaker, I had occasion to meet the American ambassador in Jamaica. I am sure he was following the Commonwealth deliberations and the result of it as contained in the communique, with great interest.



OPPORTUNITY OF PARLIAMENT TO EXAMINE CANADIAN STAND ON DEVELOPMENT PRIOR TO UNITED NATIONS MEETING

Douglas Roche: A supplementary question concerning the follow through to the Jamaica conference. Has Canada extended an invitation to the new group of ten experts to meet in Canada? Since the group of ten is to report to their own governments prior to participation in the special session of the United Nations on development in September, what opportunity will this parliament have to examine the Canadian stand before the opening of this critical United Nations conference?


Pierre Elliott Trudeau: Mr. Speaker, we always welcome constructive suggestions by parliament on this subject. The subject itself is well known and has been debated at some length in the council of the United Nations and the meetings of the non-aligned countries. Everyone knows what they are. I hope hon. members opposite will feel free to put forward their constructive suggestions either by contacting me or the foreign minister or perhaps, as the House leader suggested, taking one of the opposition days to discuss this vital matter of foreign relations.



ADMINISTRATION OF JUSTICE


Elmer MacIntosh MacKay: Mr. Speaker, I have a question for the Secretary of State. I should like to ask the hon. gentleman how long he has been aware of the difficulties, reportedly culminating in bankruptcy, of the Society for the Study of the Heritage of Canada and an RCMP investigation into this affair. Since a number of prominent Canadians seem to be involved in an advisory position and are probably a little embarrassed about it, I wonder if the minister could tell the House something about this?


Hon. James Hugh Faulkner (Secretary of State):: Mr. Speaker, I will be pleased to tell the hon. member and members of the House more about the events but I would have to brief myself. On the first part of the question, I first heard about this a couple of months ago, it seems to me.


Elmer MacIntosh MacKay: Mr. Speaker, I have a brief supplementary question for the Solicitor General. Has the hon. gentleman been aware of this situation and has any advice been given

by his office in view of the report that grants from the Secretary of State ceased some time ago and that this was the cause of the "reorganization" of this particular body?


William Warren Allmand: Mr. Speaker, I do not recall hearing about that particular grant and I do not recall giving any advice to the Secretary of State.



BAIL REFORM ACT


Mr. G. H. Whittaker (Okanagan Boundary):: A question for the Minister of Justice, Mr. Speaker. On February 4, 1975 the minister stated that statistics on the operation of the Bail Reform Act had been provided to the provincial attorneys general so that they might be aware of the figures before they were made public. Has the minister received any comment from the attorneys general, and is he now in a position to release the statistics?


Hon. Otto E. Lang (Minister of Justice):: Mr. Speaker, I think the news release was made about ten days after that exchange in the House. I do not know that I have received any specific representations from the provincial attorneys general. The intention was simply to give them the material before the public was informed.



PUBLIC WORKS


Mr. J. R. Ellis (Hastings):: Mr. Speaker, I have a brief question for the Minister of Public Works. About two weeks ago I asked the minister a question with regard to illegal immigrants directly or indirectly employed on cleaning by the Department of Public Works. Has the minister checked into that matter-I think by his smile he may not have. Would he check and give me an answer?


Hon. C. M. Drury (Minister of Public Works):: Mr. Speaker, I am sorry if my smile is misleading.


An hon. Member:: That's because we don't see it very often.


Charles Mills (Bud) Drury: It is not the policy of the Department of Public Works to engage the services of people who are in Canada illegally. Further, the conditions of employment we impose upon contractors who do cleaning services contain provisions to the same end.
May 14, 1975



PRIVILEGE


Mr. Harvie Andre:: Mr. Speaker, I rise on a question of privilege of which I gave the House warning yesterday, and of which I gave notice in writing to the Chair earlier this day concerning a matter which culminated yesterday in the Standing Committee on National Resources and Public Works.
May I say immediately, Mr. Speaker, that I am aware of the procedural difficulties in raising a question of privilege in the House when the incident occurred in a committee. A fairly recent ruling is that of your predecessor given on December 4, 1973. However, Mr. Speaker, this matter concerns the denial of that freedom of speech to which members and witnesses are of ancient right entitled in a committee of this House.
Throughout history, in those states of which this parliament is the present heir, the ultimate ruler has ever reserved to himself-as his prerogative duty-the protection and preservation of the fundamental rights and freedoms upon which the state and the institutions of that state are founded. In such a state, when such rights have been denied by the lesser magistrates, there has always been an appeal to Caesar. If there had not been, we would not be here, nor would this institution exist. A denial of freedom of speech in a committee of this House is so essentially an attack on this House that the matter must transcend the convention that a committee chairman's ruling should be settled in committee and not reported to the House.
A committee report that aborts the truth by suppression of evidence aborts the truth no less when it is presented to this House. I suggest that when a ruling by a committee chairman denies those rights which have been given into your protection on behalf of all members of this House, and this House itself, by Her Majesty, then your duty to intervene to preserve those rights is clear.
I shall read the matter complained of directly from the transcript of the May 8 proceedings of the committee. This ruling was appealed yesterday, and upheld by the committee.
The chairman of the committee is reported to have said, according to the May 8 minutes, the following:
.. . hon. members recall that during our evening meeting yesterday a point of order was raised by the hon. member from Nipissing with regard to the acceptability of a question asked of an official of the National Energy Board by the hon. member from Don Valley.
Then the chairman quoted the question, which reads as follows:
Is it your opinion that you have the authority to answer questions such as: Is it the view of the board, as a result of its studies and analysis that the price of oil in Canada should be equivalent to world prices?
He went on to say:
And at that time I reserved my decision relating to the acceptability of the question. However, I am ready to rule on that point this afternoon. I wish to point out to the hon. member that it has been long the practice of the committees of the House to leave to the judgment of the
Privilege-Mr. Andre
officials of the department to decide whether the question would involve them in controversy over government policy ...


Mr. Speaker:: Order, please. I hesitate to interrupt the hon. member, but two things trouble me. First there is the contradiction involving citation 234. The hon. member has referred in detail to proceedings before the committee. I appreciate that in some way the hon. member may want to raise the possibility of disagreeing with a decision taken in the committee. There is a method by which this can be done. Once the report of the committee is tabled, it becomes subject to a motion for concurrence. If that motion is moved, it becomes a debatable motion. It can be called and, in that way, the hon. member could debate whether proceedings in committee were proper. In that way he could expose the matter for debate.
But it would be a departure from the proceedings, traditions and practices of this House if the Chair were to consider in any way an appeal or ruling of the chairman, or a vote taken in committee which would indicate an appeal from the chairman's ruling. Unless I can be persuaded at the outset that I ought to depart from that practice as a general approach, I would not wish to look at the details of the proceedings in the committee to which the hon. member refers.
The hon. member may wish to pursue his point as to whether there should be some change in the practice and argue, on his question of privilege, that the Chair ought to sit in appeal on rulings of committee chairmen. Certainly it does not do so at the present time and it will be a departure from practice if it did so. Until the Chair can be persuaded on the general point, I feel we ought not to look at the committee proceedings in particular.


Gerald William Baldwin: Mr. Speaker, if I may touch on the point Your Honour just raised, may I refer Your Honour to an unusual debate which took place last night. The President of the Privy Council (Mr. Sharp) brought this matter before the House when he asserted categorically, as recorded on page 5769 of Hansard, that:
If you go behind the minister and compel civil servants to appear, then, of course, you break down the whole principle of ministerial responsibility.
I suggest to Your Honour that you must combine what the minister said with what the hon. member for Calgary Centre (Mr. Andre) said, because there is now a categorical assertion by the government that civil servants do not have to appear before committees. That, I think, is the issue with which Your Honour ought to deal.


Mr. Speaker:: Order, please. I am prepared to hear the hon. member on the general point as to whether a breach of privilege has been committed in any standing committee. If the hon. member wants to talk about that general point, I can listen.


Harvie Andre: Mr. Speaker, I regret that my introduction was excessively lengthy. I was quoting the remarks of the chairman of the committee. Those remarks speak for themselves and show the merits of the position. My question of privilege is not so much on the merits as on this point: that although the Standing Orders provide for an appeal, the chairman refused to allow members of the committee to debate that matter. Therefore I feel that the

Privilege-Mr. Andre
basic freedom of speech of members of parliament on standing committees was abridged. In a moment I will move a motion in support of my position. If the Chair please, may I continue.
The chairman said:
... it has been long the practice of the committee of the House to leave to the judgment of the officials of the department to decide whether the question would involve them in controversy over government policy which they are called upon to implement and not to decide. In this particular instance, I feel that the question would involve the officials in policy-making and should more properly be directed to the minister. Therefore, I find the question out of order ...
As a lawyer would say, the thing speaks for itself. I must point out that the chairman compounded this denial of freedom of speech by refusing to listen to debate on the point of order. At any rate members of my party were not permitted to debate the point of order. This incident reminds me of a similar occasion in the mother of parliaments. A member rose, and stood with his hand cupped to his ear. When asked by the Speaker to explain his conduct he said, "Mr. Speaker, I am waiting for the cock to crow a third time." As the hon. member for Peace River (Mr. Baldwin) has already said, it is totally unacceptable for ministers to indicate that they shall have veto powers under-


Mr. Speaker:: Order, please. I remind the hon. member once again that he is seeking to raise as a question of privilege the refusal of the minister to co-operate in the proceedings before the committee, that is an area which I might be able to examine. I would have difficulty, but I might be able to examine it. But if the hon. member is asking me to listen to an appeal from a ruling of a committee chairman, he ought to know that I cannot do that, unless we change the general practice in this area.


Some hon. Members:: Hear, hear!


Harvie Andre: No, Mr. Speaker, that is not my intention. I will put my motion in a minute. I am referring to the question of ministerial policy to limit witnesses appearing before committees. I suggest, Sir, that that is a debatable point. We have strong feelings about it. In the present instance the chairman of the committee decided what questions should be put. That, I suggest, was an infringement of our privileges, and I am prepared to move a motion in the following terms:
That this House, upon hearing a report on the actions of the hon. member for Glengarry-Prescott-Russell while purporting to act in his capacity as chairman of the Standing Committee on Natural Resources and Public Works, is of the opinion that he has caused and created a situation whereby the privileges of members have been infringed upon through the denial of members' rights to question witnesses, and that this matter be referred to the Standing Committee on Procedure and Organization.


Mr. Maurice Foster (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, I wish to comment on the motion proposed this afternoon by the hon. member for Calgary Centre (Mr. Andre). I think Your Honour was quite right in saying that the substance of the question should not be raised in the House, and that it cannot be properly discussed here. The practice of the House has been that such questions cannot be raised in the House unless the committee had actually reported to the House. I refer to the ruling of Mr. Speaker Lamoureux, as

recorded in the Journals of the House of Commons for December 4, 1973. Mr. Speaker Lamoureux ruled as follows:
It is well established practice that committee proceedings cannot be brought into consideration or debate in the House except by way of a report from the committee. If a point of order or a question of privilege should arise in a committee, it should be settled there rather than by way of an appeal to the House.
That is exactly what happened yesterday in the standing committee.


Mr. Clark (Rocky Mountain):: No, it did not.


Maurice Brydon Foster: The chairman's ruling was appealed and a
decision was taken on it.
The hon. member for Calgary Centre suggested that members of all parties did not have an opportunity to debate the matter. I suggest that representatives of at least three parties represented at that committee meeting spoke to the motion to appeal the chairman's ruling.


An hon. Member:: Not true.


Maurice Brydon Foster: May I also refer Your Honour to citation 295(1) of Beauchesne's Fourth Edition, which says in part: On July 24, 1956, an appeal was taken to the House from the Standing Committee on Banking and Commerce, and the Speaker ruled that the chairman's ruling should be settled in the committee and not reported to the House.
We have these two precedents, Mr. Speaker. I might point out that they go back over almost 20 years. I would also point out Standing Order 65(11), which reads as follows:
The chairman of a standing or special committee shall maintain order in the committees; deciding all questions of order subject to an appeal to the committee, but disorder in a committee can only be censured by the House, on receiving a report thereof.
The committee has not reported to the House and I do not feel this matter can properly be taken up here at this time.
The hon. member for Calgary Centre (Mr. Andre) is saying that the chairman of the standing committee is ruling willy-nilly deciding whether questions can be put to civil servants and others who appear before committees who normally do not comment on questions of policy. That is not the case at all. In the instance the hon. member has spoken about, the hon. member for Don Valley (Mr. Gillies) put a question to the chairman of the National Energy Board, which has an advisory responsibility to the government and to the Minister of Energy, Mines and Resources (Mr. Macdonald). Therefore, their discussions would normally be private. The hon. member for Don Valley put the question like this-


Mr. Speaker:: Order, please. I think we are getting into a discussion of what took place in the committee, and it is in someway being suggested that I should decide whether what took place in the committee was right or wrong. The only question I will decide is whether it is proper practice for this Chair to sit in appeal on events or rulings that took place in the standing committee. I do not want to hear the specifics.
May 14, 1975


Maurice Brydon Foster: I will conclude by saying the chairman essentially ruled that in this case, where a matter of policy had been put to a civil servant, that a point of order was raised by the hon. member for Nipissing (Mr. Blais). As the parliamentary secretary, I spoke to that point of order. I said I did not feel it was a proper question to be answered by a civil servant. The chairman ruled that the question could not be put. In his ruling, he made it very clear, and I will just read-


Mr. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, I rise on a point of order. Are we going to debate the whole question of whether or not the Chairman of the Standing Committee on National Resources and Public Works was in order or not in order? That could be a lengthy debate. I certainly am not prepared to have the hon. member who is now speaking put on record his interpretation of the chairman's ruling. Either we are discussing that ruling or we are not. I took it from Your Honour's statement that we are not discussing the ruling of the chairman.


Mr. Speaker:: The hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas) has said for the fourth time what I have said three times, that is, that I do not propose to get into discussing an appeal of the chairman's ruling. The question is whether this Chair can sit in appeal on rulings or events that take place in the standing committee. I will entertain discussion on that. I have already indicated it is my firm view it cannot. However, I am open to listen to argument on the subject. I really do not want to get into the substance of what took place in the committee.


Maurice Brydon Foster: Mr. Speaker, I will be guided by your suggestion and say I do not feel this is a matter which can properly be brought before the House at this time.


Mr. Speaker:: I propose to examine the arguments that have been put forward and the ruling to which reference has been made. I might indicate that my position earlier is in conformity with what I have already examined as to precedents. However, I will re-read what hon. members have contributed, and make my decision tomorrow.



ROUTINE PROCEEDINGS


[Stage Direction]
Fifth report of the Standing Committee on Indian Affairs and Northern Development, in both official languages-Mr. Cyr.
[Editor's note: For text of above report, see today's Votes and Proceedings.]
Order Paper Questions

[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: 468, 559, 571, 1,534, 1,813, 1,904, 1,985, 1,994, 2,000, 2,023, 2,048, 2,063, 2,138, 2,220, 2,234, 2,286, 2,306, 2,363, 2,370, 2,376 and 2,382.
Mr. Speaker, if questions No. 59, 616, 1,836, 1,868, 2,004, 2,025 and 2,107 could be made orders for return, these returns would be tabled immediately.
I ask, Mr. Speaker, that the remaining questions be allowed to stand.


Mr. Forrestall: For what reason is there no audit of the Unemployment Insurance Commission in the Report of the Auditor General for the fiscal year ended March 31, 1973?


John Napier Turner: The Auditor General has continued to audit the accounts and financial transactions of the Unemployment Insurance Commission pursuant to the requirements of section 15 of the Unemployment Insurance Act, 1971. The practice followed in prior years of including in the Auditor General's annual report financial information with respect to Crown corporations and other agencies, including the Unemployment Insurance Commission, was discontinued in the report for the fiscal year ended March 31, 1973 for the reasons given on page 6 of the report. Essentially the same information is included in the annual report of the Commission for the year ended December 31, 1972 which was tabled in the House of Commons on June 28, 1973, or in the report on the state of the Unemployment Insurance Account for the fiscal year ended March 31, 1973 which was tabled on October 19, 1973 together with the report thereon by the Auditor General of Canada.


Mr. Symes: 1.	What was the total amount of money spent in each of the fiscal years 1972-73 and 1973-74 by the Tariff Board on contracts to outside persons and organizations for research, development and other consulting services?
2.	What are the names and addresses of these outside persons and organizations and what amounts of money were involved in each
contract?
3.	What was the purpose of each contract and title of each report submitted?


John Napier Turner: 1. 1972-73: $3,000. 1973-74: $27,730.
2. 1972-73: Mr. J. P. Lacube, University of Ottawa and Mr. E. Eisenberger, University of Ottawa $1,500. each; 1973-74: Dr. S. C. Hudson, Aylmer P.Q. $15,730. Mr. W. D. Porter, Ottawa $7,000. Mr. D. J. Sutherland, Ottawa $5,000.

May 14, 1975
Order Paper Questions
3.	The purpose of the contracts to J. P. Lacube and E. Eisenberger was to draw on their knowledge and experience of the leisure industry for a reference on pleasure craft. The purpose of each contract in 1973-74 was to provide specialized assistance to the board in connection with an extensive study on fresh and processed fruits and vegetables-Reference 152.


Mr. Symes: 1.	What were the amounts of money spent by the Tariff Board on publicity and/or information in each of the fiscal years 1972-73 and
1973-	74?
2.	What were the names and addresses of firms and individuals who received these contracts, what amounts of money were spent in each case and what was the purpose of each contract?
3.	In the case of expenditures for publicity and/or information made within the Department by its publicity or information division, what was the amount in each case and the purpose of the expenditure?


John Napier Turner: 1. 197273: $1,673.08; 1973-74: Nil.
2.	The Queens Printer, Ottawa $1,673.08 publishing of tariff board report on reference 148 (E & F) strawberries.
3.	The tariff board has no publicity or information division.


Mr. Caouette (Villeneuve): 1.	What were the estimates of the Department of National Health and Welfare for the year 1974?
2.	What was the amount used for research on the causes of mental illness?


Hon. Marc Lalonde (Minister of National Health and Welfare):: 1. Fiscal year 1974-75-$4,874,903,252.
2. Under the National Health Research and Development Program, $1,015,028 has been approved towards research projects in the field of mental health for the fiscal year
1974-	75. Research on the causes of mental illness, in the clinical sense, is not supported within the framework of the above program. The Medical Research Council provided grants totalling $975,000 for research on mental disorders in 1974-75.


Mr. Herbert: Of the financial assets held by individuals in each of the past ten years, what percentage was held in (a) savings accounts (b) stocks (c) pension reserves (d) checking accounts and cash (e) life insurance reserves (f) government securities?


John Napier Turner: This information is not available.


Mr. Howie: 1.	On what date were the last tenders called for the supply of aircraft fuel for Department of Transport airports in New Brunswick?
2.	(a) By whom, and in what amount were tenders submitted (b) to whom was the contract awarded?


Jean-Pierre Goyer: 1. Tenders were called on February 18, 1975 for the supply of a full range of petroleum products at all MOT airports in the maritimes in support of MOT aircraft based at Moncton. MOT airports at Moncton, Fredericton and Saint John were included in the invitation to tender.
2. (a) Tenders were submitted by Shell Canada Limited and Imperial Oil Limited, the only contractors at the time providing into-plane refuelling at maritime airports. In so far as aviation fuel is concerned, i.e., aviation gasoline and aviation turbine fuel, both companies quoted on the basis of dealer's price on day of delivery, plus an airport fee of $0.0168 per gallon for into-plane service, (b) Standing Offers for the supply of an estimated quantity of a full range of aviation petroleum products, as and when required, at MOT airports in the maritimes in support of MOT Moncton based aircraft for the period April 1, 1975 to March 31, 1976 were awarded on March 27, 1975 to Imperial Oil Limited and Shell Canada Limited. Both companies can provide aviation gasoline 100/130 octane at the Moncton airport and an arrangement to use either or both sources was requested by MOT to ensure operational effectiveness. MOT has been advised that whenever possible, requirements should be drawn from the supplier offering the most advantageous price to the Crown at time of refuelling. The standing offer awarded to Imperial Oil covers the supply of aviation gasoline 100/130 octane at the Fredericton airport. Negotiations are still underway to locate a supplier for other MOT POL aviation requirements at Fredericton and at the MOT airport in Saint John, New Brunswick.


Mr. Reynolds: 1.	What was the cost of obtaining the fishing trawler Gulf Guard before conversion was made under CIDA's authorization?
2.	What was the total cost upon delivery of this vessel to Columbia, South America including conversion costs?
3.	What are the dimensions by way of length and deplacement of the vessel?
4.	Which person or firm sold the vessel to CIDA and under whose direction was purchase made?


Jean-Pierre Goyer: 1. $175,000.
2.	Estimated final cost when completed in May, 1975 is $540,900 afloat at shipyard.
3.	Length 82' 3" registered. Displacement 300 tons.
4.	Breton Trawlers Limited, North Sydney, Nova Scotia. Purchased by the Canadian Commercial Corporation as specified by CIDA. Technical staffs of CIDA and DSS selected the vessel.
May 14, 1975


Mr. Reynolds: 1.	What criteria were used when the contract award of $800,000 was issued to Surveyer, Nenniger, and Chenevert Inc., Montreal, Quebec for the Canada-France and Hawaii telescope project?
2.	What is the speculated cost of the construction and development of this venture both in terms of Canada's contributions and the other parties involved?
3.	What contribution of Canadian labour and construction goods are to be provided?
4.	For what reason was the Hawaii site chosen?


Jean-Pierre Goyer: 1. A predetermined weighted point system was used to select Surveyer, Nenniger, and Chenevert on the basis of the following criteria: relevant company experience and management capability; proposed methodology and work plan; availability and competence of human resources; understanding the objectives and scope of work; Canadian content; industrial benefits, i.e: capability to exploit the expertise gained on the program; costs to the Crown.
2.	The expected contribution of Canada and France is $13,550,000 each for the one-half share of the cost of the observatory. Hawaii's contribution is the site, access roads and administration buildings, deemed to be worth $4,782,000.
3.	Approximately one-third of the construction cost will be spent on contracts with Canadian firms, one-third on French contracts and one-third will be decided by international bidding.
4.	The site on the summit of Mauna Kea on the island of Hawaii was chosen because it has unique optical observation qualities with respect to the absence of humidity, pollutant particles and minimal temperature variations.


Mr. Reynolds: 1.	Was a contract awarded by the Canadian Commercial Corporation on behalf of CIDA for the supply of twenty refrigerated containers at a cost of $620,765 to be used by the Railways Improvement Programme in Zambia?
2.	Did the Department of Supply and Services invite tenders from companies that deal with our national railways for supplying such equipment?
3.	Would it have been much more economically efficient to purchase refrigerated containers from the CPR supplier and, if not, for what reason?


Jean-Pierre Goyer: 1. Yes.
2.	With the advice of CIDA, the consultant for the program and the Department of Industry, Trade and Commerce, DSS approached all potential Canadian manufacturers of such equipment agreeing to accept either the specified or an equivalent system.
3.	DSS and the consultant to Zambian Railways were aware of the refrigerated containers used by the CPR, however the manufacturer of its "piggy-back" containers did not respond to our initial survey of manufacturers. We understand that the refrigeration units, which are fitted by the CPR, are not manufactured in Canada.
Order Paper Questions


Mr. Reynolds: 1.	Were contracts awarded to various universities in Canada over the past two years by the Department of Supply and Services similar to contracts for "research and development" issued to industry and, if so, for what reason were the latter issued?
2.	What purposeful end do they achieve?
3.	On behalf of what departments are such contracts made?


Jean-Pierre Goyer: 1 and 2. Research and development contracts are awarded by the Department of Supply and Services in accordance with the policy set out in Treasury Board "Guidelines for the Implementation of the Make or Buy Policy Concerning Research and Development Requirements in the Natural SCIENCES" dated January, 1973, a copy of which is available in the Library of Parliament. The Policy as a general principle, all mission-oriented research and development requirements as well as their associated and subsequent contracts for hardware, systems and services are to be acquired from Canadian industry, as defined below, unless it can be conclusively demonstrated by a department that optimum benefit to Canada would be better served by obtaining the research and development requirements from federal government facilities. The anticipated result of the policy will be that Canadian industry, by becoming increasingly aware of the research and development requirements of government, will satisfy more of these requirements and thereby produce increased benefits for Canada through greater stimulation of the innovation process. Definition Canadian Industry means all business organizations located in Canada and incorporated or registered under federal or provincial legislation which are engaged in manufacturing, processing, primary and service industries. This definition includes industrial research institutes jointly operated by groupings of companies in Canadian industry. (While universities and provincial research foundations and councils are not included in this definition and therefore not covered by this particular policy, there is no intent to change the practice of placing research and development with them whenever this is the most effective way of proceeding. Each requirement is carefully considered by the Department of Supply and Services in relation to known potential sources for the particular capabilities required. As in normal procurement, if the capabilities required are more likely to be found in universities, these will be included in the request for proposals and proposals will be assessed in the normal manner. A summary of contracts awarded to universities on behalf of client departments during the period of the question is attached, along with a summary of all research and development contracts placed by the Department of Supply and Services during that period.
3. Details concerning the client departments and the nature of work covered by these contracts is contained in the Department of Supply and Services monthly Research and Development Bulletins covering this period which were tabled in response to question No. 1,993.

May 14, 1975
Order Paper Questions
Statistical Summary
Science Contracts Awarded to Universities April 1, 1973-February 28, 1975
By Client Department	Quantity	ValueCommunications	137	1,819,092Environment	310	3,631,162National Defence	49	590,222Energy, Mines and Resources	51	1,049,321National Library	1	21,200Ministry of State for	Science and Technology	4	41,970Indian and Northern Affairs	13	470,467Ministry of Transport	3	32,069National Research Council	1	21,784Agriculture	24	443,252Urban Affairs	2	82,180Total	595	8,202,719


Mr. Clark (Rocky Mountain): In the last fiscal year, what was the cost of operation of the Parliamentary Returns Office of the Department of Finance?


John Napier Turner: There is no Parliamentary Returns Office as such in the Department of Finance. Parliamentary returns are handled by several members of the deputy minister's staff.


Mr. Clark (Rocky Mountain): In the last fiscal year, what was the cost of operation of the Parliamentary Returns Office of the Department of Supply and Services?


Jean-Pierre Goyer: The Department of Supply and Services does not operate a Parliamentary Returns Office. A parliamentary advisor's office is responsible in part for returns of both the Supply and Services administration. In addition there are other administrative and personnel responsibilities. Therefore the direct costs for parliamentary work cannot easily be separated from the other responsibilities.


Mr. Herbert: How many post offices were there in each of the past ten years and what is the number projected for each of the next three years?


Mr. Raynald Guay (Parliamentary Secretary to Postmaster General):: Fiscal year 1964-65, 11,255 postal facilities; 1965-66, 11,172; 1966-67, 11,059; 1967-68, 10,838; 1968-69, 10,450; 1969-70, 9,575; 1970-71, 9,023; 1971-72, 8,564; 1972-73, 8,684; 1973-74, 8,710. The Post Office Department does not project the number of postal facilities for future years as the establishment of such is dependent on municipal, provincial and federal programs; i.e. the establishment of town sites, municipalities, resource development projects, etc. and the department's capabilities to provide postal services to meet the customers' needs.


Mr. Bawden: Were sections 211, 213, 214 and 215 of Part V of the Racetrack Supervision Regulations governing the use of narcotics, unacceptable medications or other stimulants, enforced during the 1973 and 1974 horseracing seasons or were they revoked on June 15, 1973 and, if so, in either case (a) is a review being made by the Minister in consultation with the provincial racing commissions (b) for what reason has it taken almost two years to review the sections (c) on what date will the review be completed (d) on what date will the sections be reinstated?


Hon. E. F. Whelan (Minister of Agriculture):: The sections were revoked on June 15, 1973. (a) Yes. (b) The delay is attributed to a study of controlled medication and pre-race testing under way by the department in collaboration with the various racing commissions, (c) No target date has been set for the completion of the review, but it will require at least a year, (d) The results of the study will determine whether the sections will be reintroduced and their effective date.


Mr. Schumacher: 1.	Did Mr. David Lewis and the Honourable Alastair Gillespie, P.C., M.P., visit Cuba at the same time this year and, if so, was this purely co-incidental?
2.	Was Mr. Lewis part of, or acting with, any delegation from the government, or on behalf of the government?
3.	Did Mr. Lewis attend any meetings attended by Mr. Gillespie or other members of his entourage while in Cuba and, if so, what was the nature of such meetings?
4.	Did Mr. Lewis avail himself of any transportation provided by the government and, if so, what was the nature of such transportation and the dates involved?
5.	Has Mr. Lewis been asked by the government for a report or has he volunteered, any suggestions and/or reports as a result of his Cuban
visit?


Alastair William Gillespie: 1. Mr. Gillespie was in Cuba from March 19 to 23, 1975. The whereabouts of Mr. David Lewis do not fall within the responsibility of the Minister of Industry, Trade and Commerce.
2.	Not to the knowledge of the Minister of Industry, Trade and Commerce.
3.	No.
4.	Not to the knowledge of the Minister of Industry, Trade and Commerce.
5.	Not to the knowledge of the Minister of Industry, Trade and Commerce.


Mr. Marshall: 1.	What are the addresses of the Consumer Help Offices in Canada?
2.	Where are the additional 40 offices to be located?
3.	Which voluntary consumer organizations were given grants during 1974?
4.	What are the details of contracts given to organizations to run Consumer Help Offices?
5.	(a) How many enquiries were made to Box 99, the Department of Consumer and Corporate Affairs, in the year 1974 (b) in how many cases were the results favourable to the person inquiring?
May 14, 1975


Hon. Andre Ouellet (Minister of Consumer and Corporate Affairs):: 1. Consumer Help Offices-Atlantic Region-Consumer Help Office, South End Tenants' Assoc., 50 Princess Street, Saint John, New Brunswick, E2L, 1K2. Consumer Help Office, Cape Breton Metrocen-ter, 360 George Street, Sydney, Nova Scotia, B1P 1K1 and Town House, Glace Bay, Nova Scotia. Ontario Region- Consumer Help Office, Earlscourt Community Project, 90 Ascot Avenue, Toronto, Ontario, M6E 1E9. Consumer Help Office, Mothers-on-Budgets, 224 Cummings Street, Thunder Bay, Ontario, P7C 1N7 and Ethnic Referral Centre, 213 Algoma Street South, Thunder Bay, Ontario, P7V 3C1. Consumer Help Office, Downtown Community Citizens Organization, 495 Glengarry Ave., Windsor, Ontario, N9A 1R2. Consumer Help Office, St. Matthew's House, 414 Barton Street East, Hamilton, Ontario. Prairie Region- Consumer Help Office, Humans on Welfare, 3rd floor, 9676 Jasper Avenue, Edmonton, Alberta, T5H 3V5. Consumer Help Office, SIGN (Society for the Involvement of Good Neighbours), 41 Broadway West, Yorkton, Saskatchewan, S3N 0L6. Consumer Help Office, Community Aid/ Resource Centre, 136 Avenue F South, Saskatoon, Saskatchewan, S7M 1S8. Consumer Help Office, Connaught Neighbourhood Society, 1347-12 Avenue S.W., Calgary, Alberta. Consumer Help Office, West End Co-Op, 796 Banning Street, Winnipeg, Manitoba, R3E 2H7. Consumer Help Office, International Centre, 280 William Avenue, Winnipeg, Manitoba, R3B 0R1. Pacific Region-Consumer Help Office, Grandview-Woodland Information Centre, 1135 Commercial Drive, Vancouver, British Columbia V5L 3X3.
2.	The objective of the Consumer Help Program called for the establishment of 20 Consumer Help Offices across the country during fiscal 1974-75. At this date 13 offices have been opened and seven others are at varying stages of development. There are plans for the establishment of ten more offices in 1975-76 and another ten the following year. The exact locations of these offices will be based, as in the past, on on-site evaluations by departmental personnel of the needs and resources of various areas.
3.	During the fiscal year 1974-75, the department accorded grants to several voluntary agencies: Consumers' Association of Canada (C.A.C.); Association Cooperative Economic Familiale (A.C.E.F.); l'lnstitut de promotion des Interets du Consommateur (I.P.I.C.); the Canadian Toy Testing Council, Automobile Protection Association (A.P.A.); the National Anti-Poverty Organization (N.A.P.O.); the Citizens' Bureau in Belleville, Ontario; the Consumers' Association of Canada (Quebec); and the Quebec City local of the Consumers' Association of Canada.
4.	Under the agreement, the department provides funds to cover the salary and expenses of the Consumer Help officer, telephone service, the cost of information materials and a fair share of the organization's rent and other overhead. A mutually acceptable Consumer Help officer is selected and hired by the contracting organization, which also provides office space, office services and guidance to the officer.
5.	(a) Between January 1, 1974 and December 31, 1974, Box 99 received 28,265 complaints and 15,422 enquiries, (b) No data is available that would provide an accurate
Order Paper Questions
answer to this question. Whether or not a consumer is happy with the results of an enquiry to Box 99 depends upon the initial expectations of the consumer in approaching the department.


Mr. Cossitt: With reference to the answer to Question No. 1,352 which listed an additional $38,470.31 expenditures on household items at the Prime Minister's official residence at 24 Sussex Drive, will the Prime Minister continue to purchase items in such large amounts from public funds or will he curtail expenses as part of government policy to reduce government expenditures?


Pierre Elliott Trudeau: The purchases referred to in Question No. 1,352 were long overdue and were necessary to the efficient and appropriate operation of the official residence at 24 Sussex.


Mr. Jones: 1.	What work was done in each year 1972, 1973 and 1974 to maintain runways at the Moncton Airport and, at what cost?
2.	(a) What runways were out of service on April 14, 1975 and for how long (b) are such runways presently out of service and, if so, for what reason?
3.	Was sufficient and adequate maintenance done on the Airport runways in 1974 and, if not, for what reason?
4.	Who is responsible for maintenance of runways at the Airport?
5.	What are the full details of the budget for the Airport for the fiscal year 1975-1976?
6.	Will extension and expansion of the terminal, passenger and baggage facilities be undertaken to alleviate the present inadequate facilities and, if so (a) on what date (b) what has been budgeted for such work in 1975-1976?


Jean Marchand: 1.
Runway maintenance, including crack filling and asphalt patching, was undertaken to the amount of $14,396 in 1972, $32,796 in 1973 and $33,795 in 1974.
2.	(a) and (b) Runway 11-29 has been out of service since April 11, 1975 due to winter damage. To prevent further damage and to permit necessary repairs the runway has remained closed with anticipated reinstatement of aircraft operations for early May, 1975. During this time the runway was available for emergency aircraft landing and taxiing purposes. Runway 07-25 has always been available for aircraft movements and thus the airlines' operations have not been jeopardized due to the closure of runway 11-29.
3.	Adequate maintenance was undertaken on runway 11-29 in 1974.
4.	The Airport Manager of the Ministry of Transport at Moncton Airport and his staff are responsible for runway maintenance.
5.	Funds to the amount of $15,000 have been programmed to purchase material and services for runway maintenance during the fiscal year 1975/76. In addition, the 1975/76 operational and maintenance budget provides $225,175 for maintenance personnel salaries, with a portion allocated for runway maintenance purposes.

May 14, 1975
Order Paper Questions
6.	(a) and (b) Air traffic control personnel utilizing space in the Air Terminal Building are to be relocated to the Area Control Centre expected to be completed in 1976/77. Modifications to the Air Terminal Building are, therefore, planned for 1977/78 providing for improved passenger handling facilities. Funds, other than building maintenance, are not programmed for Terminal expansion in 1975/76.


Mr. Cossitt: With reference to the answer to Question No. 2,163 which states in part that the current level of federal employment in Cornwall, Ontario will be maintained despite the removal of the Regional Headquarters of Parks Canada from that City, what is the total number of persons employed by Parks Canada in Cornwall in each of the past three years and, of these, how many of the jobs which they occupied or occupy will be transferred to whatever location is selected for the new Regional Headquarters?


J. Judd Buchanan: The total number of permanent positions in the Ontario Regional Office during the past 3 years are: 1974-75, 108; 1973-74, 94; 1972-73, 78. The actual numbers vary slightly from the above from time to time due to vacancies or short term casual employment. All of the jobs in the Parks Canada Regional Office will be transferred to the new Headquarters location.


Mr. Herbert: 1.	Will the proposed Hydro-Quebec power lines which are to convey electricity to New York State necessitate any change to flying regulations applicable to the private airfields located in the Constituency of Vaudreuil?
2.	Will there be any change to the flight patterns of aircraft from the Montreal International (Dorval) Airport or to the proposed flight patterns from Mirabel Airport?


Jean Marchand: 1. No.
2. No.


Mr. Schellenberger: 1.	Are fees for national parks based on years of existence and stages of appropriate development?
2.	Will the new fee structure under the five year capital development programme apply to recently opened parks before their development warrants it?
3.	Are most of the recently opened parks in Eastern Canada and, if so, will Western Canadians who more often frequent Western parks have to bear the brunt of such increase?
4.	What are the criteria for assessing the development stage?
5.	Will such charges differ for various types and sizes of campers?
6.	Will the new fee structure adversely affect the ability of various groups of Canadians e.g. the young, senior citizens and lower-income families to use the parkland facilities?
7.	Would the Minister consider applying the new fee structure to foreigners only, since Canadians have already spent many of their tax and personal dollars in the development of national parklands?


J. Judd Buchanan: 1. Fees for National Parks are based on level of development.
2.	No.
3.	The recently opened parks are located as follows: Yukon Territory (1), Northwest Territories (2), British Columbia (1), Ontario (1), Quebec (2), New Brunswick (1), Nova Scotia (1), Newfoundland (1). The fees are the same at all the parks where park motor licences are required. There are two categories, a single entry licence valid for entry and reentry on the day of issue and an annual licence good for unlimited entry to all National Parks for those who more often frequent the Parks.
4.	Assessment of the development stage is based on availability of access routes, basic accommodations and information and interpretive services.
5.	Camping fees are based on the services provided at the site, not the type or size of equipment making use of the site.
6.	No, since the fees form a very small part of any travel or recreational expenditure.
7.	No.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Cossitt: 1.	With reference to the answer to Question No. 46 of the Second Session of the 29th Parliament, which states in part that a total of $3,028,982 was allocated under the Local Initiatives Programme for 1972-73 in the constituency of Vancouver Centre, British Columbia (a) what are the names of all projects involved along with their addresses and the names and addresses of those signing the applications (b) in each case what is a detailed description of the actual project, specifically including the functions performed under the project?
2.	What are the names and addresses of all persons or organizations who recommended each project in any manner whatsoever to the Department?
Return tabled.



LIP PROJECTS-CONSTITUENCY OF ROSEDALE, ONTARIO

Mr. Cossitt: 1.	What was the total amount of money allocated under the Local Initiatives Programme for 1973-74 in the constituency of Rosedale, Ontario (a) what are the names of all projects involved along with their addresses and the names and addresses of those signing the applications (b) in each case what is a detailed description of the actual project, specifically including the functions performed under the project?
2.	What are the names and addresses of all persons or organizations who recommended each project in any manner whatsoever to the Department?
Return tabled.



HEALTH AND WELFARE SUBSIDIES-SELECTION CRITERIA

Mr. Beaudoin: 1. What are the selection criteria that apply to the pilot-projects, research projects, manpower projects and other particular initiatives,
May 14, 1975

with respect to the granting of welfare subsidies announced February 27 for the Department of National Health and Welfare?
2.	Will the persons in charge of the approved projects be obliged to provide the Department with a report on their experiences?
3.	Is the Department entitled to control the operation of the projects and of the funds?
4.	Since the implementation of the national subsidy programme in 1962 (a) how many projects gave rise to government policies (b) what were such projects?
5.	Were any projects (a) approved (b) rejected and (i) if so, which ones (ii) if not, for what reason?
Return tabled.



DREE GRANTS TO MEAT PACKING AND PROCESSING FIRMS

Mr. Mazankowski: What are the names of meat packing and processing firms which have received Regional Economic Expansion incentive grants (a) what is the location of each (b) in what year did they receive such grants (c) what was the total capital cost of each of the projects?
Return tabled.



SUPPLY AND SERVICES-PURCHASE ORDERS

Mr. Reynolds: Would the Minister of Supply and Services provide the latest available figures detailing the number and value of purchase orders issued for the more than 25 respective departments and agencies DSS supplies with goods?
Return tabled.



SUPPLY AND SERVICES-TENDERS RELATING TO DISPOSAL OF CFB FOYMOUNT

Mr. Reynolds: 1.	Would the Minister of Supply and Services provide a duplicate of the request for companies to tender with respect to the disposal of CFB Foymount, outlining all necessary conditions for sale?
2.	Will the Minister provide names of the eight companies that bid on CFB Foymount and include the dollar figure?
Return tabled.



FRENCH LANGUAGE INSTRUCTION

Mr. Cossitt: What are the names, addresses and occupations of all persons who have received French language instruction at public expense since January 1, 1972?
Return tabled.



MOTIONS FOR PAPERS

John Mercer Reid: Mr. Speaker, would you be so kind as to call notice of motion for the production of papers No. 39?
The Canadian Economy



COPY OF REPORT BY MORRIS TREVITHICK ON STUDIES RELATING TO SMALL CRAFT HARBOURS

[Stage Direction]
Motion No. 39-Mr. Marshall:
That an Order of the House do issue for a copy of the Report by Morris Trevithick on Studies Relating to Small Craft Harbours concerning their management, financial and socio-economic impacts, recommending specific system plans.
Mr. Len Marchand (Parliamentary Secretary to Minister of the Environment):: Mr. Speaker, the department is unable to issue a copy of the report referred to in the motion as no such report exists. I would therefore ask that the motion be withdrawn.


Jack Marshall: Mr. Speaker, it would appear that such a report does exist.


Mr. Speaker:: Transferred for debate. Shall the remaining notices of motions be allowed to stand?


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


John Edward Broadbent: That this House condemns the government for its failure to plan the Canadian economy and in particular for the injustice of its current wage and price restraint proposals which discriminate against working Canadians while failing to deal with persistent unemployment and the related need for government investment planning.
He said: Mr. Speaker, last week-end in a speech outside the House the Minister of Finance (Mr. Turner) suggested that unless the trade union movement in Canada agreed to his program of voluntary restraints, his forthcoming budget would have to be restrictive in nature.
After almost a year of inaction since the election, suddenly we have intimated in concise form what the Minister of Finance sees as our economy's principal problem, its cause and its cure.
Coming hard on the heels of the revelation of the government's price and wage guideline package, it was no surprise to learn that the Minister of Finance thinks there is only one economic issue, and that is inflation; that there is only one cause of this inflation, and that is wage levels; and that there is only one cure other than guidelines, and that is further deflation of the economy.
Rarely has an economic situation been so badly understood. Rarely, except for the incomparable Minister of Transport (Mr. Marchand), has a minister so deserved to be repudiated by this House. As a time when figures released by his own department clearly show that we are in the middle of a major recession the minister remains traumatized by his own doctrine of restraint. He has not only offered a partial diagnosis of our economic problem by concentrating exclusively on inflation, but in addition

May 14, 1975
The Canadian Economy
he has produced a totally unjust and unworkable scheme to deal with inflation. Such a combination of errors would be laughable if it were not for the sad fact that Canadians have to live with the mess which results.
Consider the guidelines governing inflation. The subtitle of that proposal should read "How we plan to get labour to accept the blame for inflation". The hitch in the minister's scenario proved to be that labour was not prepared to be fooled. While favouring a comprehensive approach to the problems of our economy, labour made it abundantly clear that current proposals were totally unacceptable. Why? Let us consider the minister's proposals to deal with inflation.
First, there is nothing in the program to restrict interest rates, even though the amount of income going to those whose incomes are derived from investments and interest is now at the highest level as a percentage of our gross national product since Statistics Canada began compiling data.
Second, there is nothing in the proposal to guarantee low or average income Canadians that they will actually receive the 8 to 12 per cent increases set out in the guidelines. Are the companies which employ the majority of working Canadians-those who do not belong to a union-going to give their workers what is due them out of the generosity of their hearts? If they do so, it will be the first time in history that it has happened. To believe it possible requires a degree of credulity miles beyond that of the most optimistic of Utopian socialists. Why did the minister not commit the federal government to raising its minimum wage to at least three dollars an hour thus ensuring that at least some low-income Canadians got an increase? Why did he not propose immediate implementation of a minimum income program-such as is advocated by the Minister of National Health and Welfare (Mr. Lalonde)?
Third, nothing is contained in the guidelines to increase the supply of housing, or to hold down rents, both of which are essential to a reduction in the price of accommodation, a presently crucial component of the cost of living. Rents are shuffled off to the provinces to deal with, and virtually nothing is said about increasing housing starts. Does the minister not know that, next to food, housing is the most important component of the cost-of-living index?
Fourth, no mention is made of oil prices despite the fact that if the government permits a $2.00 per barrel increase in the price of oil this act alone will wipe out entirely the government's chance of reducing the rate of increase in the cost of living by 2 per cent per year in line with its present objective. A commitment to freeze the price of oil would have achieved the minister's minimal objective without involving the whole country in a tangle of unjust guidelines.
Finally, Mr. Speaker, there was nothing effective proposed to hold prices and profits in line. Given the corporate sector's almost infinite capacity to manipulate cost data, and the related ability of multi-national corporations to increase their intra-company prices to their Canadian subsidiaries, it is evident that the price and profit guidelines are totally incapable of being effectively enforced.

The only effective part of the minister's proposals would be that which involves the wage levels of working Canadians. Federal and provincial governments would be expected to enforce the guidelines with respect to their employees. The private sector would also have the moral sanction of a government program to enforce them on their employees. The trade union movement-if it had agreed to the proposals-would be expected to bargain within the framework of the guidelines.
I ask, Mr. Speaker, why any working Canadian should ever accept an anti-inflation policy which restrains him and no one else? I ask the Minister of Finance why he brought forward such a totally unfair proposal? Not only is the anti-inflation aspect of the proposals unfair to ordinary Canadians, but of even greater significance at this time is the total absence of any policy to increase employment.
If some plan to reduce the rate of inflation is desirable- as is accepted in principle by our party-then surely we also require an equivalent commitment to produce jobs for the 800,000 Canadians who need them. I will have more to say about unemployment shortly, Mr. Speaker. But at this point I want simply to stress that the total emphasis of the proposals put forward by the Minister of Finance is on inflation and, more specifically, on what he considers to be wage-induced inflation.
For a number of months now the minister has been trying to convince the Canadian public that in the crime of inflation wages are the culprit. He and others have pointed to wage settlements reached in the last quarter of 1974, citing with misleading regularity the statistic that the average wage settlement for that period was 17.4 per cent. Two conclusions were drawn from this statistic, first, that this was proof that labour was getting more than its share of the economic pie and, second, that Canadians would price themselves out of competition in international markets. I would like now to deal with both points.
First, it is important to note that the 17.4 per cent wage increase figure referred to pertains to no more than 3 per cent of Canadian workers. It was an average of the settlements reached in the last quarter of 1974 by the better organized unions in the larger bargaining units. I stress here that 97 per cent of the Canadian labour force is excluded from the 17.4 per cent statistic. Indeed, 97 per cent of Canadians received substantially less than this increase precisely because the vast majority are either in no union or belong to weak unions. The average wage in Canada for the last quarter of 1974 increased by only 5.4 per cent. And for the first quarter of 1975 average wages increased by only 2.4 per cent, or an annual rate of just under 10 per cent. Why, then, is the minister so preoccupied with wage rates?
The second point to be made is that labour income must be seen in the context of all other sources of income. The Department of Finance, in its economic review issued about a week ago, puts the situation in perspective. During 1974 labour income represented the smallest percentage of the GNP since 1968. At the same time corporate profits were at their highest proportion of the GNP in 25 years- since 1951. Is it not understandable and entirely just, especially given the recent rates of inflation, that labour should get these higher increases to make up for the
May 14, 1975

decline in real income that they have experienced in the last few years? If they are still getting increases of only 10 per cent, as they are for this year, why, I ask again, is the Minister of Finance putting the squeeze on the working people of Canada?
I want now to turn to the Minister of Finance's stated concern that, if wages and salaries keep going as they have been, we will price ourselves out of world markets. I say, with respect, that I think his argument in this case is even weaker than the first argument he has made.
What is the evidence? In 1974 Canada had a lower rate of inflation than any of her trading partners in OECD, with the exception of Germany. The latest OECD figures for March, 1975, show that Canada's price increases are somewhat lower than the average for OECD members. However, the main point that I want to make is that any problems we are experiencing with exports have virtually nothing to do with wage settlements. During the first two months of 1975 we had a drop in exports of manufactured products to the United States of about 2 per cent compared with the same period in 1974. What is important to note, however, is that most of this decline is due to a fall off in automotive exports, and that none of this decline can be attributed in the slightest way to wage settlements in Canada.
During the first two months of 1975 our exports in dollar value of raw materials, which account for about 70 per cent of our exports, were up by 43 per cent over 1974. Most of our raw materials industry is capital intensive, with labour costs therefore playing a small role in the total cost of output. Even if this were not so, international forces well beyond our control or influence determined the world price for iron ore, copper, zinc and so on.
Apart from the United States the only other of our major trading partners where the dollar value of our exports was down for the first two months of 1975 was Japan. I stress that the only one of our other major trading partners, with the exception of the United States, where we have had a decline in exports is Japan. This is due to a decline in the exports of lumber and wood products, which have fallen because of a recession in the sectors of the Japanese economy using these materials. Again, like the decline in automotive exports to the United States, Canadian labour costs have absolutely no bearing on the issue.
So far I have argued, first, that the minister's program of restraint is full of loopholes and is unfair to working Canadians; second, that Canadian wages and salaries are not growing disproportionately compared to other countries; and third, that in terms of our trade problems Canadian wage levels have either had no effect or they are entirely irrelevant. All of this makes me conclude that, on these grounds alone, the Minister of Finance's proposals and their supporting arguments should be rejected outright. However, there is an additional and equally compelling reason, and that is that in his bungling fascination with inflation the minister has ignored the ominous problem of unemployment.
On behalf of my party, in both the throne speech and budget debates last fall, I warned that unless the govern-
The Canadian Economy
ment took immediate corrective action then we would have a major recession on our hands. Again in a special debate in February of this year I urged the minister to bring in a new budget quickly to head off a deepening of the recessionary trends. It is no consolation to look at the unemployment figures which were announced yesterday, which reveal that some 800,000 Canadians are out of work. It is no consolation either to look at the industrial output figures that became available today showing a decline in productivity running at a negative rate of some 11 per cent this year. It is no consolation at all to be able to say, "I told you so".
The decline in output at this rate of 11 per cent has tragic implications for thousands of Canadians. This decline for the third quarter in a row means that we are deeply imbedded in a recession. No amount of evasive talk from the Minister of Finance, no amount of charm or clever answering in the House, will enable Canadians to escape this sad fact. With 800,000 Canadians out of work now, unless the Minister of Finance brings forth an expansionary budget within the next few weeks the situation will worsen in a dramatic way. If he remains preoccupied with his current proposals, a million Canadians-I select the figure with care-could be walking the streets seeking employment next December. The Minister of Finance must admit he has been wrong, and must move quickly to take corrective action.
The new budget must be expansionary, and wherever possible increased expenditure should be aimed at both job creation and at mitigating inflation. These are not, as some would have us believe, mutually contradictory objectives.
Let me make some specific suggestions, Mr. Speaker. First of all housing starts, for example, are down by 40 per cent when compared with the same quarter of last year. The minister should radically revise his target of 210,000 units upwards to 400,000 units. Again I select the 400,000 figure not out of the hat but with care.
To achieve this target the government would have to increase in significant proportions its own expenditures. To make sure that the job is done it should also follow the example of the British Columbia government and go directly into the development business. It should take immediate steps, by changing the Bank Act, to bring down the level of mortgage rates so that average Canadians could afford to buy a house once again. By so acting, I want to stress that no or little inflationary pressure will be put on the economy. Indeed the slack in the lumber industry in New Brunswick, Quebec and British Columbia would experience a recovery, and the 25 per cent now unemployed in the construction industry would once again find jobs. Instead of putting new inflationary pressure on labour and resources, such action in the housing field would simply take men and women off the unemployment lists.
Secondly, we need a reasonable tax reduction restricted to average and low income groups in order to compensate for inflation and to stimulate demand in the economy, which I repeat has ground to a halt.
Thirdly, there should be a public commitment to freeze the price of oil. This would be good both for Canadian consumers and for Canadian industry, and would keep the
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May 14, 1975
The Canadian Economy
latter in a competitive position. I repeat the point I made a few minutes ago, that if the government permits the price of oil to go up some $2 a barrel, this will have a negative effect of some 2 per cent alone on the rate of inflation.


Robert Lorne Stanfield: They won't like that in Saskatchewan.


John Edward Broadbent: I could deal with that point but I won't take the time.


John Napier Turner: Oh, come now!


John Edward Broadbent: I am sure that the Leader of the Opposition (Mr. Stanfield) would not want to distort the proposal put forward by the premier of Saskatchewan, which is not the position he just intimated. But I will not be sidetracked, Mr. Speaker.
My fourth point is that the government should raise the federal minimum wage to $3 an hour by at least July 1 of this year, and get the provinces to take corresponding or equivalent action in terms of the provincial minimum wage. Again this would be concrete action that would enable low income Canadians to cope with an inflating economy.
Finally and importantly, what Canada requires in the area of employment is a national development plan that takes fully into account certain short run and long run advantages that we possess as a country, and which other countries do not possess. Potential self-sufficiency in petroleum gives us an immense edge over the industrial countries in the Common Market and over Japan in the immediate situation. Our immense natural resources give us a long run advantage shared by few other nations of the world.
What is required is a decisive expansion of the role played by the federal government in planning and directing the economy. Private investment has fallen off recently, for the perfectly rational capitalist reason that profit expectations have diminished. It would be crazy to invest if you do not expect to make a profit.
The government, in our view, is the only force capable of filling this vacuum in the short run if massive unemployment is to be avoided. In the long run, Mr. Speaker, the selective and strategic use of public investment, public ownership and government expenditure, must be at the core of a national development plan whose ultimate objective is to achieve full employment and hold under control, as far as possible, escalation in the rate of inflation.
We must get beyond the boom and bust cycle, the cyclical nature of the Canadian economy; and only a national economic plan can come close to achieving this kind of objective. Unfortunately only the New Democratic Party is committed to such a policy for Canada. The Liberals in a majority situation, which they have had since last July, are once again demonstrating that they are a party of indifference, unemployment, and inequality, a party wedded to the foolish and unjust economic ideas of the past. We are long overdue for a change.


John Napier Turner: Mr. Speaker, I should like to deal primarily with the argu-

ments put forward by the leader of the NDP in the House, the hon. member for Oshawa-Whitby (Mr. Broadbent). I understand that the Leader of the Opposition (Mr. Stanfield) will be speaking later and I want to apologize to him in advance, because the short notice of the motion has put me in the position where I have commitments later this afternoon which are physically impossible for me to cancel. I do undertake to him that I will read what he has to say and be back here for the vote. If it were the hon. gentleman's motion I would be here to listen to him as well, as I usually make it my practice to listen to him when he speaks because of his position in the House.
The hon member for Oshawa-Whitby concentrated, and he is entitled to his choice, on unemployment. I share his concern in that regard, particularly at current rates. I have said on several occasions, and particularly in my last budget of November, that we have twin problems; we have the problem of unemployment and threatening world recession, as I said in November, and we also have the problem of inflation.
The argument I want to make today, as I have made on several occasions inside and outside the House, is that if in present circumstances we do not solve the problem of inflation and non-competitive prices and costs of production, then we will risk future unemployment in this country, particularly because of the non-competitive posture in which this country will find itself. In other words, it is not an either or situation.
The hon. member has talked about outmoded economic policies, but I suggest he has been dealing with that this afternoon. Unless we solve the problem in respect of costs and prices in this country our problem of unemployment will be rendered severely worse. In other words, it is a precondition to expansion in this economy and employment opportunities, with the fastest growing labour force in the world, that we get ourselves back into the competitive range of prices and costs.
If the hon. member is talking in terms of traditional trade-offs, then I think he is off the point. You will recall that the budget of last November has a different thrust than the budget of the previous May, because it was in response to the deterioration the government then saw in the world economy. I have admitted in the House that we underestimated that deterioration. We underestimated the depth of the recession in the United States, and the depth to which that would bring the world economy.
I said then that the budget was aimed at dealing with the twin problems of inflation and slow growth, and that the first essential action then was action to sustain demand. Of course the budget was an expansionary budget in November.
The major cause, as I have said, of this continuing deterioration of the world economy has been the plunge by the United States into the deepest and most prolonged recession in the history of that country in the post-war period. The United States administration only belatedly recognized that, and switched from a restrictive fiscal and monetary policy to an expansionary policy in early spring. The President turned from a policy of tax increases to a policy of tax cuts. It is only now that the administration and Congress are negotiating what the energy policy is going to be, because at one time it seemed to have been
May 14, 1975

counterproductive with tax cuts and with the fiscal spending program.
Aside from the U.S. economy and the prospects we see for the world economy, and aside from oil and gas pricing and some other factors I have brought to the attention of the House, one of the factors the government and I have to take into account in formulating the next budget is the outcome and the prospects of the long series of discussion and consultations we have been undertaking with various groups in the economy, to which the hon. gentleman's motion is really directed, in an effort to arrive at some mutually agreed course of action, if that is possible. That is a course of action for bringing inflation under control in Canada in a gradual process over a period of three or four years. I suggest a period of three or four years, because we can see that such a period is necessary if we are not going to restrict the economy overly and provoke massive unemployment.
I recognize that in some quarters, particularly some rather close ones across the aisle, this whole endeavour has tended to be dismissed as so much window dressing on the assumption that, and this is in other quarters not shared by the Leader of the Opposition, the problem of inflation is rapidly receding of its own accord.
I do not want to include the Leader of the Opposition in this, because he is aware of the seriousness of the problem, but some feel that the recent trend over the last four months, in which inflation has been running at the annual rate of somewhere between 7 per cent and 7!/2 per cent, now indicates that we have the problem beaten and under control. As I said in Sarnia, I believe this is a very dangerous and mistaken assumption.
The problem of inflation, far from receding, has become more critical for the Canadian economy with every passing month because of the extent to which it increasingly threatens to undermine our competitive position both here in our own markets and abroad in foreign markets.
I have seen it suggested that certain government spokesmen, among them myself, have greatly exaggerated the threat posed to our competitive position by inflation. Indeed this was the argument just put forward this afternoon by the leader of the NDP in this House. He argued, as have others, that the rise in Canadian consumer prices recently has compared favourably with the United States and most other industrial nations, except Germany. He argued, as it has been argued in other places, that the increase in Canadian wages and salaries has also been lower than in most nations other than the United States and Germany. He argued, as it has been argued in other places, that the increases in the prices of Canadian manufactured goods have been moderately less than the increases in the prices of those manufactured goods we import from abroad.
While all these points are valid enough, they fail to take account of the trends and tendencies which this country is now facing, and fail to take account of a number of crucial situations. In every country, and this has been stated by Helmut Schmidt, Chancellor for Germany, to whom the hon. member loves to refer as being in his social democratic fraternity, and by U.S. Secretary of State Simon, who does not quite jibe with the political and economic
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philosophy of the hon. gentleman-both of them have said-


Mr. Knowles (Winnipeg North Centre):: He belongs to your fraternity.


Lorne Edmund Nystrom: He is with you and Dick Nixon.


John Napier Turner: Now Lome, you don't believe that. Both of them, from different economic and political points of view, have pointed out the risk of the re-appearance of inflation, perhaps in a more virulent form than ever, as the tone of economic activity tends to pick up, if it picks up simultaneously in the major industrialized countries of the world.
For Canada, I believe and submit to Your Honour, this danger is particularly great because of the substantial increases in costs that are now being built and have been built into our economy in the second, third and fourth quarters of 1974 and the first quarter of 1975, as a result of very large increases in wages and salaries. It is quite true that these increases generally have been below the average experienced in Europe and Japan, but that overlooks the fact that the United States is still by far and away our largest customer, our largest market, and we export 65 per cent of everything we produce. In manufactured goods that percentage is even higher.


John Edward Broadbent: Most of it is raw materials.


John Napier Turner: I am talking about our manufactured and processed goods where the situation is even more critical. The very fact that for a considerable period Canadian wages and salaries have been rising at a very much faster rate than those in the United States should make obvious that our competitive position is being jeopardized.
The hon. gentleman says that the recent figures for the first quarter of 1975, of between 16 per cent and 17 per cent, cover only 3 per cent of the work force, but these are the recent settlements. These are the figures that are setting a trend. The recent figure for the United States- and I know that these figures are not exactly comparable but they are close enough-is 7.8 per cent. I am just saying to the hon. member that if that trend continues then it poses some difficulties for this country.


John Edward Broadbent: It is a trend for a small percentage of the labour force.


John Napier Turner: Well, the real danger is down the road when the United States economy recovers against the recession. When the productivity at that stage of the cycle comes up it will experience not only a greater increase in its productivity but a greater unit cost economy than we will have in Canada. I believe the risk, if the present trend continues, is that the inevitable result of such a development will be a substantial widening in the differential of unit-labour costs in Canada compared to those in the United States, and therefore a sharpening deterioration in our competitive position. Now more important is that, as a major trading nation, we have already reason to be concerned about the import-export
29561-23%

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picture that has been developing over the past several months.
It is true that the major impulse of the deterioration up until now, although I am advised that the cost of production figures are beginning to be negative insofar as Canada is concerned, has been the deterioration in the American, Japanese and British economies. Those recessionary effects have been the primary impulse in affecting our exports. The cost of production figures are now becoming very relevant.


John Edward Broadbent: Would you give us some examples-


John Napier Turner: I have half an hour and I have to outline the argument as best I can. The fact of the matter is that the more severe the impact of inflationary pressures is in eroding our competitive position, the more severe will become the problem of unemployment, at a time when unemployment is unacceptably high. I agree fully with the Leader of the New Democratic Party. At a time when our labour force continues to grow at the fastest absolute and comparative rate in the world we simply cannot afford to impede the development of new job opportunities on a massive scale.
In my view, therefore, we have no practical alternative but to do everything we possibly can to break the spiral of inflation. The question is, and the difference of opinion in this House is, how? There are a number of different views. To put the issue in some perspective let me recall that this was a question which confronted us with growing urgency in the fall of last year when it was becoming increasingly apparent that sharply escalating domestic costs and prices were rapidly replacing international forces as a major source of inflationary pressure in this country.
We concluded then that there were only three alternative courses open to the government to deal with the serious threat to Canada's competitive position, both at home and abroad, which is created by the soaring spiral of domestic prices and domestic costs. We could adopt highly restrictive fiscal and monetary policies to curb inflation. We could use the fiscal and monetary tools. We could propose comprehensive mandatory price and wage controls, or we could attempt to work out a mutual understanding among all sectors of the economy in an attempt to gear down fairly and equitably the inflation rate through voluntary means. All these approaches involve hard choices. In fact what is before the country now is a series of unpalatable options. We recognized that each of these presented major problems but we also recognized that we had to make a choice.
Rather than adopting the most strict fiscal and monetary policies, which would have resulted in declining output and rising unemployment, the budget which I brought down in November was aimed at stimulating both output and employment in the least inflationary way possible by reducing taxes. We did not feel that imposition of mandatory controls should be considered then, because of the serious problems they would undoubtedly create. Mandatory controls imposed by government fiat, without the strong backing of the public, stand little chance of achieving even minimal success in controlling inflation. We saw no evidence that the necessary degree of public support would be forthcoming at that time.

By a process of elimination we came to the decision to pursue the third option, that of trying to bring together the various groups in our economy in an effort to work out a mutually agreed plan for scaling down the rate of inflation to a more acceptable level, that would be as effective, fair and equitable as possible. There is nothing easy about it. We are aware of the pitfalls and the frustrations. There is nothing easy about attempting to forge, in a federal state, a mutual understanding to govern the setting of prices and incomes among the various sectors of the economy. We are equally aware, however, that if we did not achieve a mutual understanding, the practical implementation of that understanding, even if we are able to achieve it, from day to day would be difficult, as indeed it would be under a mandatory system.
I submit to Your Honour that if Canadians look squarely at the critical threat confronting this economy and the courses and options open to us in dealing with the threat, they would agree that working together to fight inflation would far better serve their best interests than any of the other alternatives.
The Leader of the New Democratic Party made the allegation that the proposals put before labour, management, the professions and the other sectors of the economy, were unduly weighted against the working man in this country; in other words that they were unduly weighted against labour. I would say to him, and to the House, that the program being developed by the government in an attempt to halt the spiral of costs and prices applies to every sector of the economy and not just to labour. Because wages, salaries and supplementary labour income compose some 70 per cent of Canada's national income it is obvious that they are the most important single element in the income picture. But fairness, equity, and effectiveness just as obviously demand that all other kinds of claims on the national income must also be moderated if we are to bring inflation under control.
The working papers leaked to the press I believe were badly misrepresented and misunderstood. The fact of that leak seriously jeopardized the chances of arriving at an understanding among all sectors of the economy. I am going to summarize the substance of the proposals. Maybe the hon. member for Don Valley (Mr. Gillies) has not read the papers I gave him.
We proposed as discussion papers for a consensus, if that were possible, that all groups would be allowed to gain at least the target rate of the increase in inflation, that is to say, to preserve their real income. If the consumer price increase rose faster than the target rate the groups would be entitled to recover the difference in the second year, and would not be penalized for an underestimation of the target rate. Workers who had fallen behind the average increase in the last two years would be entitled to increases larger than the target rate of the price increase of up to 4 per cent.


John Edward Broadbent: How are the unorganized workers to get this?


John Napier Turner: Lower income workers would be entitled to a minimum increase of $600, and higher salaried groups would be subject to a maximum increase of $2,400. The unorganized worker would be put
May 14, 1975

in a better position, as would pensioners, if we could get this problem of inflation under control.


John Edward Broadbent: That does not answer the question of how they will get the increase.


John Napier Turner: And there would be provision made for exceptional cases. Also for selfemployed professionals, professional fees could only be increased by an amount required to improve their net income by a maximum of $2400 available to salaried executives and professionals. In respect of dividends it is true, as I said to the House in reply to the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), that we have not yet, either with labour or management, solved the problem of dividends and the question of trading off a fair return to the shareholder, but not excessive and not exceeding the return available to the worker, and still preserve the investment opportunities and enhancement for capital investment of those concerned.
On prices-and these were spelled out with the same detail as wages which is the reason I say that the proper balance was not paid to those two items in the report that was made of those working papers-on prices, first of all the general principle envisaged was that for the first year of the consensus the price increase would be limited to amounts sufficient to cover increases in unit costs; that is all. Where the allocation of costs to products was impractical, the onus would be on the company to comply with the general principle. Wholesalers and retailers would undertake not to increase the mark-ups on various merchandise and, where this was impractical, they would agree not to exceed the percentage gross margins realized during the base period.
In effect profit margins would come down as prices went up, unless volume increased. The general principles were not applicable to the export industries, and the Canadian Labour Congress is concerned about, as am I, and as are the industries, how to get a fair allocation in this area, but it is still under discussion.
In the food area there was no attempt at any time to impose a limitation on food prices at the farm gate or on fish prices at the net. Where food prices are not determined by the market, marketing boards will be expected to meet the intent of the general pricing principle. Processors and distributors, however, would undertake to comply with the general principles.
As for interest rates, the primary rate would be determined by financial markets, but the general pricing principles would apply to rates by banks, trust companies and loan companies.
With regard to rent, the working papers did not make any specific proposals because of the continued discussions with the provinces under whose jurisdiction that lies, and the Canadian Labour Congress officials have indicated that they would like to see the principles inherent in the B.C. program implemented.
Provincial governments are receiving the following proposals: first, new construction would be exempt for five years. Second, increases would be permissible up to the
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CPI target. Any increase over the targets would have to be justified by cost increases. In other words, what I am saying is that there was every intent that, if anything happens to be worked out, these discussions can proceed with a possibility of equity that is inherent in the system, and this has been made clear to every sector of the economy, namely, that every sector of the economy will bear an equal share.
The suggestions advanced in the working papers did not constitute a firm set of proposals by the federal government but some suggested approaches to provide a basis for further discussions among the various groups. I said from the beginning that the government did not seek to impose a consensus but to help a consensus evolve. The points put forward in the paper were intended to provide a focus for continuing discussion, and as such they are very much in keeping with the consensus process.
I believe it is quite possible to meet many of the concerns voiced by labour, for instance with respect to rents, dividends, professional fees and the position of the export industries. A number of areas of concern that have been raised depend on the extent to which the provinces are prepared to exercise their influence and authority.
I might note that four Atlantic premiers expressed in a recent communique their readiness to throw their full support behind the program for moderating inflation. We are still exploring the extent to which other provinces are also prepared to do so. That is also part of the difficult and complex process of evolving a consensus in a federal state such as ours.
In the absence of full provincial support and co-operation, many of these concerns could only be met by the establishment of an over-all mandatory federal system of controls. It is the only way, as I said in reply to the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), in which we would have constitutional authority to do it under the peace, order and good government clause.
In discussions with various groups, we have made every effort to keep them fully informed on the nature of our discussions with other groups and their positions on different issues.
I recall that on January 22, as found at page of 2055 of Hansard, the hon. member for Oshawa-Whitby urged me to bring forth a new economic policy, as he said "whose objective is to achieve full employment soon, and at least mitigate the effects of this terrible inflation". He recognized the two problems as being equally important. I want to say to the hon. member that there have been precious few suggestions from the NDP as to how inflation should be brought under control. The traditional position of that party, restated this afternoon, is to advocate the establishment of a government agency empowered to control prices, but to ignore the other side of the coin, namely, wage and salary costs. Both have to be dealt with together if they are to be dealt with at all.
Since wages and salaries make up 70 per cent of the national income, it is perfectly clear that it is simply not possible to moderate inflation unless the rate of wage and salary increases is also moderated and there is some ability to obtain a consensus on this side of the market. The NDP also continues to remain ignorant of the fact-either

May 14, 1975
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ignorant or it ignores it-that bringing inflation under control in Canada is an essential prerequisite to re-establishing full employment, however you define employment.
I want to contrast the position taken by the hon. member for Oshawa-Whitby this afternoon with the position taken by some of his colleagues, including the hon. member for Cambridge-Waterloo (Mr. Saltsman) and the premier of Manitoba. I recall that in the House of Commons on December 19, as recorded at page 2399 of Hansard, the hon. member for Oshawa-Whitby said he thought the Minister of Finance "entirely correct in expressing concern about restraint by those who are very well paid in our society". I am quoting the hon. gentleman's words.
He went on to say:
I think that a very good case can be made, for example, for a program that would impose serious restrictions on the capacity of middle and upper income people to extend their wage levels beyond the cost of living increases in the foreseeable future, while others are much lower in terms of their existing income and must deal with an inflationary economy.
I agree with that, and the bias in favour of the lower income groups was apparent in those proposals.


John Edward Broadbent: There is no guarantee they will get it.


John Napier Turner: The hon. member for Oshawa-Whitby went on to suggest that an approach to organized labour would be justified, involving discussion of wage gains as part of a package that would involve tax reductions for average and low income people and a wealth tax on upper income earners. In other words, he felt our approach was worthwhile and justified, and that as late as December 19.
Although obviously the government will have to consider all its options in coming before parliament in a few weeks with the budget, I believe that through the process of consultation and compromise it should be possible to reach a mutual understanding that will best serve everyone's interests if the will exists to reach such an understanding. I understand the risk involved for certain leaders in the community, but I want to say that it is equally clear that if there is no disposition to do so, then there would be no difficulty in creating insurmountable obstacles to any agreement being arranged.
In every system involving moderation of prices and incomes, whether voluntary or mandatory, there will always be problems. No one will be perfectly satisfied with every aspect of the problem. It is inherent in this type of arrangement or in mandatory controls that there is a type of rough justice that has to be adhered to, and there will always be one group or another that considers itself treated unfairly, or that considers that another has been overly favoured.
I note the contention of the hon. member for Oshawa-Whitby that the government has no intention of controlling prices. He was quoted in the Globe and Mail of May 7 as saying:
Given the ability of corporations who manipulate cost data, the price control guidelines outlined in the government's proposals are simply not capable of effective enforcement.
He repeated that today in other words. If the NDP leader in the House seriously believes that to be the case, one might fairly conclude that their repeated proposals for

the establishment of a price board of some kind is nothing more than a sham. Presumably the NDP believes that a regulatory agency would be able to prevent such manipulation. Otherwise they would not have harped so long on the need for some type of price review board.


John Edward Broadbent: Mr. Speaker, I rise on a point of order. I expect the minister to allow me to make a correction in view of the fact that he interrupted me in a recent debate, and I want to make sure that at least we understand each other clearly if we are going to disagree. My specific reference that he quoted was to the particular mechanism proposed by the government, which was involved in dealing with profits as opposed to the prices review board mechanism. My point was that you can disguise profits in a way that you could not disguise market prices.


John Napier Turner: I accept that clarification. However, the hon. member did use the words "price control guidelines". In any event, I hope that such a monitoring agency proposed in the discussion papers will be equally capable of doing so.
To bring this to a conclusion-and I thank the House for its indulgence-a process of seeking to develop a consensus on voluntary means of controlling inflation has necessarily been laborious and time consuming. When you are dealing in terms of consultation and in terms of a federal state, and you are trying to bring the various representative elements of an economy together, it takes time and effort. We believe that the time and effort will be well spent if this results in an agreement or an approach that offered some promise of breaking the cost price spiral while at the same time restoring healthy growth of output, employment and real income.
As a result of these consultations we came to the conclusion that any plan that evolved must be flexible enough to make it possible to deal reasonably with exceptional cases. It must make special provision for those at the lower end of the earnings scale in recognition of the fact that they are more adversely affected by inflation than others. It must enable those who have fallen behind the rising cost of living to catch up, and enable all of those who work to keep up with future increases in living costs. It must seek to forestall disproportionate increases at the upper end of the income scale that would result from application of flat, across-the-board percentage hikes.
We recognized that there would, of course, be problems in working out a plan that is totally satisfactory to everyone, but those problems would pale by comparison with the problems that would be created by our failure to work out some form of mutual understanding on prices and incomes.
In any event, the facts as I see them are fairly simple. What it comes down to is that the competitive position of our industries at home and abroad is in danger of being seriously undermined, and the future growth of output, employment, and incomes seriously jeopardized unless inflation is brought under control. Of the three alternatives open to us, voluntary co-operation offers the brightest hope of checking the rising spiral of costs and prices in a way that will best serve the interests of Canadians
May 14, 1975

individually and collectively. If that turns out not to be possible-and the government is going to assess the [DOT] present state of those discussions-then I will have to canvass the Prime Minister (Mr. Trudeau) and my colleagues on the options we are to bring before parliament. After we have had thorough discussions in cabinet those options will be brought forward in the budget, or at a time fairly close to or coincidental with the budget.
In any event I am confident that if Canadians face facts at this stage in the economy and weigh the choices and options, they will decide that we are far better off resolving our problems by working together than compounding our problems by working against each other.
I welcome the opportunity that the hon. member for Oshawa-Whitby has given me to put a few facts on the record to clear up this matter.


Robert Lorne Stanfield: Mr. Speaker, during the last few minutes that the minister was speaking I had the feeling that I was listening to one of my own speeches, except that it was not as well delivered!


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: First of all I want to say that I understand the minister may not be able to remain throughout the debate. He has an emergency on his hands, a hospital case. I hope when he leaves somebody else will come in and occupy one or two of the seats on the front bench and show some interest in this important subject.
I also hope that the minister will understand if I say some things that are fairly firm and pointed when he is not here to hear them. I think he can understand that some of these things will not be said for the first time, and they will be said with some feeling.
I intend to offer an amendment to the motion, Mr. Speaker. I want to say that I do not agree with everything the Leader of the New Democratic Party said, but if by any chance my amendment is not accepted by the House I want to make it clear to the minister that I intend to support the motion as one way of making as clear as I can how much I disapprove of the behaviour of the government in recent months.
It is eight months since the Minister of Finance (Mr. Turner) spoke to the Canadian Club in Vancouver and put the fundamental economic alternatives faced by Canadians in these terms:
One way or another a balance is going to be struck in the allocation of shares of the national income between the various sectors of the economy. We can come together and seek to strike a fair and reasonable balance between such elements as wages, prices and profits through a process of consensus which will make possible continued strong growth of national income to the benefit of us all. Alternatively, we can allow the balance to be determined by the process of prolonged and bitter industrial strife, which could leave everyone considerably worse off by substantially reducing the size of the pie that is available to be shared between us."
It is strange how brightly the light shone for the minister so shortly after the election campaign. How tragic it is that, in the eight intervening months since the minister spoke those words in Vancouver, he and the government have shirked their responsibilities and just let time fritter away in an unconscionable manner. The unavoidable
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result of all this fooling around is that for many Canadi-[DOT] ans today the so-called consensus program looks like a sham, and from here at least it looks like it is in a shambles. All through the process there has been too much of an air of gamesmanship-too much secrecy-too little public information and too much confusion, sometimes seeming to be created deliberately. Considering the seriousness of the problems which face Canadians, the government's performance must be vigorously condemned by any member of this House whose concern exceeds partisanship.


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: The Prime Minister (Mr. Trudeau) told us that he was really the one ultimately in charge of designing and selling this program. But I judge that he has tied a can around the neck of the Minister of Finance and is happy to see it rattle away as hard as it can.
Neither the Minister of Finance nor the Prime Minister really lent their own personal weight to the process, although perhaps the Minister of Finance is so deeply involved now that he is trying to swim. They didn't get behind this process as it was supposed to be developed. That was a dead giveaway as to how seriously they were taking it. They suckered a lot of Canadians very successfully during the 1974 election campaign, and it looks as though they have been at it ever since.
It is not hard to look back and see that the government came out of that election victory celebration with a terrible hangover. That is about all it came out with-except a majority, of course.
I think it hoped that things would improve fairly quickly in the American economy, and if it provided some short term stimulus in the November budget, that would tide us over a couple of rough quarters. As for inflation, Mr. Speaker, when you spend two months of an election campaign selling people on the idea that nothing can be done, then for some decent interval at least, if you are a sincere Liberal, obviously you must do precisely that-nothing.
Then we started to hear about the consensus, first from the Minister of Finance shortly after the new parliament met, or even before-


John Napier Turner: In the throne speech.


Robert Lorne Stanfield: I think the minister anticipated the throne speech-he was ahead of the Prime Minister on that point. Then we heard about it in the budget and on and on ever since. I think at the outset the minister expected a pretty speedy recovery of the American economy. He expected price inflation to abate, and he generally assessed that the economy could stand a little wage demand inflation as a function of catch-up. I think that was what the government wishfully thought last fall.
As a follow-through to the dishonest position taken by the minister and his colleagues-because everything the minister could see today concerning the dangers to the economy, the damage being done to the ordinary Canadian by inflation, and the threat to our competitive position, was equally apparent to anyone who was willing to look

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last July-the government adopted a basically sound idea. It explored the possibility of an incomes policy. Then it took this basically sound proposition and perverted it into something which I guess it hoped would appear to be an immediate anti-inflation program. So a new dishonesty was born, and a worthy concept has been discredited as a result.
An incomes policy approach is a longer term kind of thing that takes a lot of talking about and a lot of time. For months and months we did not know what the Minister of Finance meant when he talked about consensus. He would not tell us. It was something which was too confidential for this House and country. We were not to know about it. Finally he defined the basic elements of what he had in mind. We recognized then that he was talking about an attempt to achieve some form of voluntary incomes policy.
To try to achieve an incomes policy under duress is, of course, a strange way to do business. So, to give the minister and the Prime Minister and associates the benefit of the doubt, one must assume that the use of a longer term incomes policy proposal as a cover for the absence of any effective short-term action to deal with inflation started out simply as a time-buying operation-something to help them "make it through the night." I think that is the way it started.
When the minister presented his budget in November this was very apparent. The budget did nothing, absolutely nothing, to come to grips with inflation. All we got was another smokescreen about consensus. It was a time buying operation.
The minister's forecasts made at the time of the November budget were shot hell west and crooked within a few months. Sad to say, this has not been an infrequent development. Successive ministers of finance have made poor forecasts. The United States economy was not recovering quickly. Our biggest customer was tightening its belt and our balance of payments position was running from bad to worse. At last the outlook was terrifying the Minister of Finance. Unemployment was climbing, productivity falling, labour unrest growing, housing prices and interest rates started going up again, while housing starts, the value of the dollar, and confidence among the Canadian people were on the decline. So then the government suddenly had to put up or shut up on its consensus program. What began as a time-buying game became a game it had to play in earnest.
We have heard some of the most outlandish things since then. Now the minister says he wants voluntary agreement, or else! He holds out a threat. He has said-the program is voluntary, mind you-that he will introduce a restrictive budget to enforce his position if people do not go along. In effect he has said to labour, "If you do not go along with what we suggest, if you do not agree, we shall bring in a highly restrictive budget and then you will see what it is like."
I have a hard time taking all this seriously. I have to believe that it is more than gamesmanship. If the Minister of Finance is serious, the government, surely, is in the role of a hijacker saying, "Go where I want to go or I'll blow us all up." That's what this kind of play really amounts to. There is nothing so simple and innocent here as, "evaluat-
ing the options" or exhausting options. A highly restrictive budget now, Sir, would be the final disgusting act of a sequence of events born in dishonesty, nurtured in complacency, and matured in perversion.
When we saw the document-it is not a proposal; I do not know what it is-we knew then that it had made pretty good sense for the government to hide it. Last Monday, when the details were revealed by the Toronto Star, the minister said that it would be premature to comment on the details. On Tuesday he complained that they must have been "earlier working papers." On Thursday, after a statement by the Acting Prime Minister (Mr. Sharp), and after it was common knowledge that they were the most up-to-date expression of the government's thinking that was before labour and business, the minister protested against the press report of the documents and said, and I quote, that they "did not fairly reflect the amplitude or totality of the proposition of proposals in discussion." That was his theme again today.
He left the impression that the reports were so distorted that he could not even recognize the documents as they were reported. Yesterday he asserted he had read the final documentation before it was sent out. What pathetic and tortuous evasion! After reading the documents one can say there is no doubt they had been fairly and vividly reported in the press. The fact is, Sir, that last week, after they started to be leaked out in print, the minister was ashamed of the documents. They provided no meaningful basis for a meaningful response from organized labour, and have only incited a sterile exchange of rhetoric.
Some will argue as to whether a voluntary restraint program can work, or be workable. I suggest that if it is to be workable, if it is to be acceptable, it must be comprehensive, and must elicit unanimity from all sectors of the economy. It must be expressed in specifics by the government. The government pretended it was working on this question all during the fall, all during the winter, and all through the spring, and then it laid an egg. This really stretches one's credulity.


An hon. Member:: It was an abortion.


Robert Lorne Stanfield: No. They do not permit abortions for those reasons.
The documents themselves do not necessarily suggest that the government intends simply to restrain wages. I do not intend to suggest that that is the government's purpose. However, they do reveal that where there are difficulties, where some decisions are required, the government has nothing to propose. On professional fees, prices for export industries, dividends, rents, marketing boards, financial institutions and monitoring mechanisms, the government stands exposed as indolent, irresolute, weak and rhetorical.
I have said that I will support a sincere and responsible effort by the government to formulate a program of voluntary restraints, but I am not bound in any way to support or endorse the way the government has conducted or is conducting this exercise.
First, I dissociate myself from the divisive rhetoric of the Minister of Finance. It is hypocritical and irresponsible to wage a campaign for common restraint with an
May 14, 1975

analysis of the problem that singles out one group in our national community, and with threats of restriction that would single out the weak. I realize the effort of framing such a national program is difficult and politically dangerous. However, I do not feel it is excusable to employ the tactics of the demagogue when things get hot. If I may speak personally, I know something about the difficulties of advocating a demanding and tough response to inflation. However, I sincerely believe I did not threaten the unity that program would require by singling out villains, or threatening repressive and reactionary measures when it was attacked.


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: The Minister of Finance and the Prime Minister describe the consensus process as the third option, but really it is nothing of the kind. A consensus, a recognition of our common responsibilities and an acceptance of the fairness of where we are going, must be the foundation of any effective program to bring inflation under control, while retaining the vitality of our national economy. A sense of common purpose coupled with the will to pursue a common goal surely is something more than an option.
I believe we possess such a spirit in this country, and with a reserve of common sense and determination we can restore the health of our economy. However, our unity is a fragile as well as a valuable commodity, and it is threatened not only by the economic problems we face, but by the conduct of the government at this moment. The Minister of Finance's advocacy of the consensus approach does not capture the common interest, but invites division and is leading to failure.


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: With this government everyone is really wondering what is really going on. This government deluded and misled the public prior to, during, and for a number of months after the last election campaign. It said, "There is little we can do. It is all foreign developments. Controls never work anywhere. There are disasters all over the place." Instead of facing up to the problem that anyone could see was facing the Canadian people, and urging Canadians to face up to the problem, the government has literally led the Canadian people down the garden path.
I call on the government to stop this unmitigated madness, to come to its senses, to come clean with Canadians, and use its mandate for the good of the country. There are some three years to go before another election. There were nearly four years when it started this. This is no time for short term partisanship. It is time for the government to face up to its responsibilities, face the problems of this country and tell the Canadian people what are the problems. If it does that it will certainly have the support of the official opposition.


Some hon. Members:: Hear, hear!
The Canadian Economy Mr. Stanfield: I move:
That the motion be amended by striking out all the words after "in particular for" and substituting therefor the words "its failure to implement a policy of restraint that will be equitable for all Canadians and appropriate for a healthy expanding economy".


Mr. Deputy Speaker:: At first glance I have a tendency to hesitate to accept and put to the House the amendment moved by the hon. Leader of the Opposition (Mr. Stanfield). Taking into account that this is a very short day, I feel uneasy about inviting hon. members to become involved in a procedural debate. To my mind the proposal put forward by the Leader of the Opposition brings in not a completely new proposition but a completely new alternative solution. Because of this I have some reservation. I am not in a position to put the amendment in its present terms at this time. If hon. members want to express their views to enlighten the Chair, I will listen to their views as to the procedural acceptability of the amendment. Otherwise, I will take it under advisement and render a decision later.


Robert Lorne Stanfield: Mr. Speaker, I rise on a point of order. I have no desire to chew up any of the time available for debate this afternoon. I put the amendment forward as a constructive proposition. However, I would be very disappointed if we got involved in a procedural argument which would deprive members of their opportunity to speak.


Stanley Howard Knowles: Mr. Speaker, I have the same view, that this is not the day for a lengthy procedural debate. Speaking for my colleagues, I may say that we are prepared to leave the decision in Your Honour's hands. We have to do that anyway. I just want to make the point that on opposition days it has been the general rule not to allow amendments from another party if they completely alter the motion as put down by the party whose day it is. Amendments have been allowed if they add something which is incidental to the motion, but not if they strike out most of the main motion. I submit this amendment strikes out the philosophy we have tried to put before the House and puts in something else. That may be what the Leader of the Opposition (Mr. Stanfield) wishes to do. However, I hope Your Honour will find that procedurally it is out of order.


Gerald William Baldwin: I just point out to Your Honour two predecents where the hon. member for Winnipeg North Centre (Mr. Knowles), in spite of what he just said, proposed amendments which were accepted by the Chair. They went quite a long distance toward altering the original motions. I simply put them before Your Honour without argument. On March 7, 1972, as recorded at page 600 of Hansard, the hon. member for Winnipeg North Centre moved an amendment to a motion which I had moved. As reported at page 1092 of Hansard for 1972, a motion moved by the hon. member for Simcoe North (Mr. Rynard) with regard to pensions was altered to a very substantial extent by an amendment moved by the hon. member for Winnipeg North Centre.


John Edward Broadbent: Mr. Speaker, I will just take a minute to add my comments to what has been said. My concern is not whether it is traditional for one party to offer an amendment to another party's motion on an opposition
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May 14, 1975
The Canadian Economy
day. I think the hon. member for Winnipeg North Centre (Mr. Knowles) will agree the more substantial question is whether the amendment alters the motion in a fundamental way. I put forward the proposition that that is precisely what this does.
Looking at the words to be struck out, I do not think it is any coincidence that the amendment proposed by the Leader of the Opposition (Mr. Stanfield) would cut out the democratic socialist core of the motion of my party. In particular I refer to the concluding words where we call for "the related need for government investment planning." That is not coincidental to the motion, as the wording makes clear. Those words are preceded by "a need for". In our view that is inextricably connected with the original motion. Any amendment to strike out that wording would fundamentally alter the motion and, in our view, should not be accepted.


Mr. Deputy Speaker:: Order, please. I do not know if I should proceed in this way, but because of the time limit I wonder if the Leader of the Opposition (Mr. Stanfield) would accept the suggestion to amend his motion by adding to the motion a "furthermore" instead of taking away so many words. I do not want to go into the basics of the main motion or the amendment. I have not studied that aspect. But adding words would allow the Chair to accept the amendment in its present form.


Robert Lorne Stanfield: I am entirely reasonable. I want to fight inflation, not my hon. friends down there. If it is more acceptable to the Chair I could add, at the end, the words "and for its failure to implement a policy of restraint that will be equitable for all Canadians and appropriate for a healthy expanding economy."


Mr. Deputy Speaker:: Does the House agree to allow the Leader of the Opposition to modify his proposal?


Some hon. Members:: Agreed.


Robert Lorne Stanfield: Then I move, seconded by my hon. friend from Peace River:
That the motion be amended by adding after the word "planning" the words "and for its failure to implement a policy of restraint that will be equitable for all Canadians and appropriate for a healthy expanding economy."


André-Gilles Fortin: Mr. Speaker, the New Democratic Party is moving today a no-confidence motion against the Liberal government, pointing out the failure of the latter to plan the national economic to fight not only inflation but also the persistent and uncontrollable rise of the unemployment rate in Canada.
While deploring the fact that the New Democratic Party does not offer any means to remedy the government's negligence and blindness, I must recognize that the greatly perturbed economical and social situation is a direct result of the laziness, and I would even say the inefficiency of the Liberal government, although it is a majority and a strong government. It might well be, Mr. Speaker, because it has a solid majority that things are so bad in Canada, especially in the labour field. This government does not listen anymore to people, it has drifted away from

them; it is administering this country as though Canada belonged to it and without any concern at all for the fears and hopes of the Canadian people. There are, Mr. Speaker, excessive claims from one ocean to another. Others are reasonable. At all events, be they excessive or reasonable, the government is turning a deaf ear.
Mr. Speaker, it is not because the Canadian people provided the Liberals with a strong majority in the last federal election that the latter have the right today to legislate during four years without giving any consideration to the claims of the Canadian people. That is surely a harsh opinion, but why not? That opinion corresponds to what the Canadian people demand: this government told the Canadian people in the Speech from the Throne that inflation would be wrestled to the ground, that unemployment would regress and that the Canadian people would enjoy a good and long period of prosperity.
The Minister of Finance (Mr. Turner) repeated that in his November budget. He had forecasted all those good things, those nice promises that can be compared to those that were made during the last election. That is what the Liberals were saying during the last federal election, at the time they were turning down the Progressive Conservative proposal on a price and wage freeze.
The Liberals are bragging when they say that Canadians rejected price and wage freeze during the last election by voting Liberal. If that is true, then it was strickly a negative vote, a vote against Progressive Conservatives and not necessarily for Liberals. If, on the other hand, it was a positive vote, the fact still remains that Canadians sincerely hope for solutions other than price and wage freeze to the serious problems of inflation, unemployment and spiralling prices.
So, Mr. Speaker, no matter how one interprets the vote of the last election which gave the Liberals a strong majority, it must still be recognized that the results after nearly a year of majority Liberal government are yet to be seen and felt. What solutions does this government have to curb inflation? What solutions did the Liberal government take or intend to take to control in one way or another the increase in consumer prices? What are the solutions, Mr. Speaker? The government found a few of them. It decided one day since it was elected to set up a Royal Commission on Corporate Concentration to inquire whether they were making too much profit, whether their demands were exaggerated and whether their influence over the economy created a power parallel to that of the government.
Mr. Speaker, let us not go any further and hope for results that will not be forthcoming from that Commission since, first, that will be another commission whose recommendations will be left gathering dust on shelves, all the more, Mr. Speaker, as the name of one of the members of that Commission is Pierre Nadeau who is president of Petrofina Canada Limited, a large multinational Canadian oil company.
Therefore, Mr. Speaker, this Commission should not be asked to be more objective than necessary because, it is itself facing the same problem that the one it will investigate. This Government, which wishes also to deal with that problem, appointed another commission, the Meat Marketing Commission. Who is sitting on this Commission which has been mandated to inquire whether unrea-
May 14, 1975

sonable profits are made by middle-men between the producer and the consumer? Its objective is to protect the interest of Canadian consumers in order to avoid abuses in that particular field as we know that today the meat business is extremely important in Canada, especially in so far as the quality of food is concerned. So, who is sitting on this Commission? Who are the investigating commissioners? Representatives or executives of Dominion Stores Limited and executives of Steinberg's Limited.
Again, Mr. Speaker, how could we hope to achieVe positive results and really protect the interest of Canadian consumers when the Commissioners are the very profiteers in the market they are investigating? It is all window-dressing; the government must have plenty of nerve to appoint such commissions as a face-saving move designed to demonstrate to the public its concern for such or such economic sector. But when one sees the resource people used by this government to make investigations, one is allowed to entertain reservations regarding the objectivity of the commissioners, but also of their recommendations, if any.
In his answer to the leader of the New Democratic party, the hon. member for Oshawa-Whitby (Mr. Broadbent), the minister of Finance referred to the working papers prepared by senior civil servants and published in the 7th report of the ad hoc committee; and he suggested that opposition members should read carefully that document which is the first suggestion of a voluntary wages and prices restraint agreement in Canada.
It must be pointed out that the cost of living has increased in every sector of our economy, housing, interest rates, food or production cost. In every case, all the government did was to appoint commissions of inquiry which in my opinion are not trustworthy if you consider the members of those commissions, since the possibility of conflicts of interests has not been discarded.
Moreover, the government was elected and they said on the last election they would wrestle inflation to the ground, try to curb unemployment and try to make way for a fair period of prosperity for Canadians. Like all my colleagues, I heard them make such statements during the last election. The people of Canada trusted this government; they expected efficient solutions, since the ones who were most affected by price increases, by inflation or unemployment are indeed low income people, labourers, farmers.
However, no definite action was taken except for so-called pension escalations, but they had always been part of the budget speeches we heard, either in May 1974 or in November 1974. And we shall probably hear them sing the same song during the next one in May. Proposed fiscal measures are always to the expense of the average taxpayer. The government do not want to interfere directly with the mechanism of prices and salaries. They do not want to impose any rule or any program to the Canadian economy. This government prefers, as a policy, to let things go the way they want to, to make inquiries, to monitor possible abuses. Its economic leadership is superficial in that it does not try to find strong allies to wrestle inflation to the ground, or more efficient tools to stop unemployment.
The Canadian Economy
I have read the working paper which the hon. Minister of Finance (Mr. Turner) referred to in his speech. At page 7, on food prices, a problem which affects most Canadian consumers, it is stated that:
With respect to food prices, it may be stated in general...
And this is a paper by senior officials which is supposed to be the Bible of this new agreement on voluntary restraint which is proposed to us.
... that farmers and fishermen do not have the power to determine the prices at which their products are sold at the farm gate or the fish dock. Thus, the question of restraint does not arise.
This is what we find in the paper written by senior officials and which the Minister of Finance referred to.
What means have we today, if this request for voluntary restraint is not directed to farm producers, be they producers of wheat, meat or any kind of Canadian farm product? Whom is this request of the Minister of Finance directed to? To what extent is this request serious, since senior officials admit that they can do nothing, because, in the area of food, it is not the producers who control prices. If they are not the ones who have to exercise restraint, the middle men or those in charge of marketing will have to.
But marketing is controlled in Canada by Dominion Stores Limited and Steinberg Limited, among others, because they are not the only ones, of course. As I said, these companies have practically a monopoly on the marketing of almost every food product in Canada. They control marketing and probably production. And, Mr. Chairman, they are the direct cause of food prices increases.
However, I have grave doubts that the government will ever dare come to grips with this kind of monopoly or collusion in the Canadian economy or with those profiteering at the expense of both consumers and producers.
The minister called on us to read the document. My colleague for Bellechasse and myself put some questions to him during the question period, concerning the main cause of inflation. That is, the cost of money, the cost of interest charged by the Industrial Development Bank to small businesses, and by the Central Mortgage and Housing Corporation for housing. The minister answered there was nothing he could do about rising interest rates, because this was controlled either by chartered banks, which are private corporations, or by the Bank of Canada in another sector. More importantly, he could not act because this was an international problem. So here comes the "national Trudeau excuse". Nothing we can do. This government, despite its majority, cannot do anything about the cost of money in Canada. But the governor of the Bank of Canada answers directly to the Minister of Finance.
So the Minister of Finance told us today there was absolutely nothing he could do about interest rates. His working paper he wants us to read, because this is his Bible, shows he will not act. Rather, he passes the buck to labour and employers. He says: "Exercise voluntary restraints, because we ourselves cannot or will not do it". He has no solutions to check inflation and unemployment in Canada. That is why he does not act.
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May 14, 1975
The Canadian Economy
On page 8 of the document we read:
Proposals regarding interest
... that is to say,increases...
-this, of course, comes from the minister's advisers, the ones who devised that consensus scheme-
... in interest rates charged by these institutions . ..
-banking institutions, chartered banks-
... should be justified by increases in the interest rates which they pay and their operating and other expenses. There has been no discussion yet with representatives of financial institutions.
That is the end, Mr. Speaker. The Minister admits in his working paper, which is the basis of a supposedly effective fight against inflation, that there has been no discussion and no contact between his department and the banking institutions concerning the level of interest rates in this fight against inflation.
Mr. Speaker, I say that Canadians would be stupid to agree to this voluntary arrangement contained in the minister's suggestion, without having first of all the Minister's formal undertaking that the same sacrifices will be demanded of the Canadian banking system as those which will be imposed to Canadians, with salary increases as determined on the first page of this paper.
One of the main causes of inflation and unemployment in Canada is our monetary system and money supply. It has been said in the House that there is inflation because there is too much money in circulation. In fact, Mr. Speaker, we understand today, since we have been hearing the older parties talking about money economy, that there is inflation not because there is too much money in circulation, but in fact because there is not enough money, because our money is losing its value, because it is depreciated and because the prices are spiralling and getting out of control.
There is a solution which strikes directly to the heart of the problem. Mr. Speaker, it is a solution that the credi-tistes have been putting forward for a long time and which is called consumer price discount. Today, we complain that what is most expensive and affects the prices most is the production costs. Because of prices and production costs, Canadians are going without commodities or food or else they go into debt to obtain them. Such is the situation for Canadians. If one reviews the Statistics Canada figures, one notes that the rate of indebtedness of Canadians is not only increasing continually but that it is reaching obviously dangerous levels.
However, Mr. Speaker, a Food Prices Review Board brochure entitled "What Price Nutrition?", published in February 1975, states that 52 per cent of Canadian families are going without appropriate or sufficient food and without healthy nutrition, because of the prohibitive price of food products in Canada. According to this publication, their diet lacks vitamins C, iron. This is very interesting, Mr. Speaker. I quote:
The significance of the Board's findings in this report is perhaps best considered in light of the Nutrition Canada Survey which was conducted over a 28-month period ending in December 1972. It found large numbers of Canadians with deficient intakes of key nutrients. Nearly 70 per cent of all women between the ages of 10 and 64, for instances, are not receiving enough iron.

Because of the prices.
More than 50 per cent of all Canadians, with the exception of children under 10 and men between the ages of 20 and 39, have sufficient intakes of calcium. Between 10 and 20 per cent of Canadians do not receive enough Vitamin C. And there are other examples.
Why, Mr. Speaker? Because people must watch their budget instead of concerning themselves with the quality of food products. They feed themselves according to their income. Our feeding habits, our physical health depend on the money available. Inflation has become so serious that not only the livelihood but also the health of Canadians are threatened and jeopardized.
The prospects are none too promising either. The minister said earlier that things will improve, that there is no need to worry or panic because that will be back in order.
I will not read all the article but in volume 7, No. 4, of the magazine entitled Revue de la main-d'oeuvre, Quebec area, second semester of 1974, the prospects are described as follows:
The incidence of the economic slowdown will be probably fraught with consequences for the labour market during 1975; the unemployment rate in Canada should increase substantially because of the anticipated low employment.
Two whole paragraphs are just as encouraging. What an outlook!
As I said, Mr. Speaker, within a year, or six months, the same situation will prevail without any solution being found.
That is why I emphasize this point in order to draw the attention of the Minister of Agriculture (Mr. Whelan) and to incite him to consider the Social Credit proposals related to adjusted discount, which is not a price or salary control but simply an adjustment of wages against the price paid. An excessive increase of products is thus avoided, which allows producers to meet the consumers' demand. There is no other solution.
The government lacks the courage to act, it puts the responsibility on employers and on unions, but, for the time being, it has no proposal to put forward.
Mr. Speaker-


The Acting Speaker (Mr. Penner):: Order please. The time allotted to the hon. member has expired.


Sinclair McKnight Stevens: Mr. Speaker, I join in this debate with mixed feelings because I believe we are really entering into a family squabble in two senses. The other evening those who were with us, and I see that the President of the Treasury Board (Mr. Chretien) is one of only two Cabinet ministers still with us-


Some hon. Members:: Hear, hear!


Sinclair McKnight Stevens: The President of the Treasury Board stated that he liked the views of the NDP, and he reminded us that, in the words of former Prime Minister St. Laurent, the only difference was that the NDP were in a hurry.


Gerald William Baldwin: Both going backwards.


Sinclair McKnight Stevens: I would also remind the mover of this motion that his good friends on the other side will presumably do exactly what he wants, namely, adopt some type of socialistic plan for the takeover of all productive sectors in the country. I say that because when we were at the meeting of the Standing Committee on National Resources and Public Works only a few days ago one of my colleagues asked the Minister of Energy, Mines and Resources (Mr. Macdonald)-I am sorry he is not in his seat today-about Petro-Can, and whether it was to be the government's policy in general that whenever there appeared to be a private company that it thought, whatever justification it might have, was not doing its full job, the government would form a Crown corporation. The minister said:
-whenever there has been an observed public need, Mr. Malone, we have taken this action, yes.
My colleague then said:
With that philosophy then, potentially all industry at sometime could be government owned?
The minister replied:
If all industry fails to perform and is not going to look after the needs of Canadians, then clearly the government is going to have to move.


An hon. Member:: That is pretty good stuff.


Sinclair McKnight Stevens: As the hon. member for the NDP says, that is pretty good stuff, but I would simply suggest that the motion today is an illustration of the fact that presumably there is a bit of a rift in this coalition between the NDP and the Liberal government.
In a second sense, Mr. Speaker, I suggest what we are seeing today is a rift within the NDP caucus itself. Those of us who watch "Canada AM", periodically will recall the words of the hon. member for Waterloo-Cambridge (Mr. Saltsman), who more or less cleared his soul and told the watching public exactly what was going on within the NDP. He said the fact was that they had lost their purpose and the Liberal party had swung so far to the left, and taken all their ideas, and there was really no future for that party. Therefore I believe that what we have in this motion by the hon. member for Oshawa-Whitby (Mr. Broadbent) is an illustration of how he at least wants to demonstrate that there is some difference between the Liberals and the NDP.
In that respect, I am sorry he has framed the motion in this form, because while we on this side in the official opposition have very little faith in the way the government has been conducting the economic affairs of the country, we believe the motion is wrongly worded and implies at least some type of socialistic planning which is so much an integral part of NDP thinking.


An hon. Member:: How will you vote?


Sinclair McKnight Stevens: In answer to the hon. member who asks how I will vote, let me say that when you are faced with two evils you have to decide which is the worst. As our leader has indicated, and we certainly intend to support his amendment, in order to show our opposition to the government benches we will unfortunately have to vote for the hon. member's motion.


Some hon. Members:: Oh, oh!
The Canadian Economy


Sinclair McKnight Stevens: The Minister of Finance (Mr. Turner) joined in this debate earlier, spending most of his time talking about the consensus program. He stated that one of his alternatives was a highly restrictive fiscal and monetary policy for the country.
This motion before us is really related to the mismanagement of our economy. Surely the government must accept the fact that our present problems can be laid at its doorstep. It is the high government spending and the almost unbelievable increase in the money supply in this country that has contributed more than any other single thing to the inflation we are living with today.
Earlier today I directed a question to the Minister of Finance in which I pointed out that Federal Reserve Chairman Burns in the United States has given a commitment to Congress that he will not increase the money supply in that country by more than 5 per cent to IVi per cent. I asked our Minister of Finance if he had a similar commitment from the Governor of the Bank of Canada to assure that there would be some restraint in this country.
The minister replied, "Mr. Speaker, the hon. gentleman put this type of question to the House before. Over the whole 12-month period ending March, 1975, the increase in the money supply series has been 12 per cent, M-1,-"there he is referring to the primary money supply system-"a figure which appears to be within the range that is reasonable in the circumstances in terms of the nominal growth of the economy."
Here we have a Minister of Finance telling us that a 12 per cent increase in our money system is reasonable. He failed to point out of course that in the first three months of 1975, the first quarter, the M-1 growth in Canada was 33.1 per cent, compared to a growth in the same quarter in the United States of 4.4 per cent. He also failed to point out that if you review the growth of the money system in the United States and in Canada and compare the two growths, during the period our present Minister of Finance has been in office you will find that our money growth has been almost twice as fast as that in the United States.
Those are the facts. The minister must know this. He fails to level with the Canadian public. Instead he chooses to single out sectors of the economy, such as labour, and blame them for whatever inflationary pressures we now have or which he may feel will occur in the future.
If we turn to the matter of government spending I could give equally alarming figures concerning the growth in federal expenditures under this government. For example, federal government expenditures in 1974 were twice what they were in 1969, three times the amount spent in 1961, or 12 times the 1950 level. Let there be no mistake, that is the fertile ground in which the inflation we are now living with has been planted.
Dealing with this motion and the amendment thereto, I would suggest that first of all we must see how on earth we in this country got into the present position. This is the most fortunate country in the world. We have an alert, growing population, well educated people, and resources that are the envy of the world. We often overlook our good fortune. Canada, with slightly over half of one per cent of

The Canadian Economy
the world's population, has 7.3 per cent of its land surface, 15 per cent of its known fresh water resources, and a disproportionately large percentage of proven and potential reserves of many key minerals including, if you like, the Athabasca tar sands which have potential reserves of oil approximating the total proven conventional reserves of the rest of the world put together.
Similarly we are amongst the world's leading producers of food, grain and livestock. Indeed we have the potential to be self-contained in respect of most vital resources. With such potential one would expect that we could take a significant lead in the world in helping underdeveloped nations and relieving international tensions. At home we would appear to have every ingredient necessary to make our people number one in the world in true wealth, yet we find we are losing, not gaining, relative to other people in the world. Figures recently released show that Canada now is number six in per capita wealth. Imagine! We were number two in the world and we had reason to believe we could be number one, yet under the present Minister of Finance and the present government we have slipped from number two to number six on a per capita basis among the significant countries of the world.
With such a capability in respect of our resources and our people one would expect that poverty would become less and less in this nation. Yet we find the drive to lessen poverty in Canada has made little or no progress in the past 15 years.
I think it is significant to point out that in the previous 200 years significant gains were made in overcoming poverty in this country. If we go back to 1763 we find it is estimated that at that time 95 per cent of the people living in the colonies that are now part of Canada were poor by any standard. By the time of Confederation around 80 per cent were still below the poverty level, but by 1961 those classed as poor in the country were down to approximately 20 per cent. Since then, however, this percentage has remained static-I think this is significant-while the welfare bill in Canada has risen five-fold. In 1975 we will spend more than $22 billion, which is more in real terms than all government spending in 1961. Expressed another way, about 20 per cent of the nation's national income will be used to help relieve those less fortunate, but their plight does not appear to be improving. The modern notion that a state can spend its way out of poverty is not working in Canada.
Surely the time has come when we must seriously ask ourselves why we in Canada appear to be faring so poorly. If one believes the words of the Minister of Finance it would appear that he believes we will do still worse in the future. Why should our real growth now be projected at zero for the current year? In fact under our present Finance Minister we find that not only is our real growth turning to zero but that we have had more unemployment and triple the inflation that we had under former Finance Minister Benson, his predecessor, and we are heading into the highest trade deficit in our history.
Many of us can recall that we complained about Finance Minister Benson, but I can tell you that he was the height of fiscal and monetary responsibility compared to our present Minister of Finance.

I should like to touch on many other points. I would suggest that this government has really been the most permissive government we have ever had in Canada. It will be known as the Permissive Government. It is a government which is permissive on all fronts, not only on the economic front but in respect of law and order. This government has no equal in respect of its permissiveness. Rather than a Just Society they have given us a Permissive Society.
As has often been mentioned, income taxes have risen as a result of the government's action at a much faster rate than real terms would justify. Strikes are becoming an increasing problem; 9.2 million days were lost last year, one of the worst records in the industrial world, compared to 3.9 million days lost in 1969. These are the reasons we believe, in spite of the wording of the present motion, that we must join in condemning the government for the way it has been operating, particularly with respect of the economy. In seven years under our present Prime Minister we have had less real growth than in the previous seven years. Yet there has been three times the inflation, and a higher percentage of our work force unemployed.


Mr. Caccia:: Why do you not mention the new jobs that have been created?


Sinclair McKnight Stevens: At the present time the percentage of our gross national product that i$ going into government is 40 per cent compared to about 30 per cent in 1960. If this government activity fails, I suggest it fails by being too expansive.
Our friends to the left have often stated that they believe that the epitomy of state planning or of their socialized planning approach is Sweden. I suggest to them that Sweden is perhaps a good example of what not to do or, if you like, what to do if you must have a socialist state.


Some hon. Members:: Hear, hear!


Sinclair McKnight Stevens: I would point out that in that state 95 per cent of the economy is still in private hands, in fact more than in Canada. I would also point out that the Swedes are very careful. Instead of interfering with the private sector, certainly by taking it over, they state quite openly that they believe that the private sector must be preserved in order that they can get the tax revenue needed for their welfare programs.
I would simply suggest that this little alliance of the NDP and, if we believe the President of the Treasury Board, the Liberals, who are really slow NDP'ers judging from his words, will lead us more and more into a state intervention system, one in which we will be placed virtually in a situation where our present economy will become worse and worse, partly due to the lack of direction from the government and partly the unfair interference from the government in the operation of our economy.
If we are ever to put an end to spiralling prices, high interest rates and economic stagnation we must stop the growth of government, especially in the commercial field, and we must put our monetary and fiscal house in order. To reverse the trend of fiscal irresponsibility we need
May 14, 1975

stronger leadership in Ottawa. We must resist the current feeling that there must be more and more government spending and government involvement. It is hurting, not helping our progress.
I suggest to my friends to the left that our free enterprise system, for all its faults, has at least made this country prosperous.


An hon. Member:: The workers did.


Sinclair McKnight Stevens: But I would also suggest that it is a mile ahead of whatever is running second. Some like to proclaim the inevitability of the demise of this system. I suggest that there is no way in which this system will fall into a demise if we are alert. The fact is that our economic system has raised us from a poverty ridden group of colonies, where 95 per cent of the people were poor by any measure, into a great agricultural and industrial power. We now define poverty in this country at an income level that is higher than the average income level of the world's strongest communist nation, and at a level higher than the average income in 80 per cent of the nations of the world. Yet our government, through its inaction and misdirection, has placed this system in jeopardy.


Lorne Edmund Nystrom: Mr. Speaker, it will be very interesting to see the hon. member for York-Simcoe (Mr. Stevens) rise in his seat after his attack on the horrors of socialism and the horror of this party and vote in favour of the motion put forward by this party which calls for more government investment planning. It would be interesting to see him support that motion, as his leader will do, after the speech he has just made.
I must say at the outset that when I heard the Minister of Finance (Mr. Turner) today I thought for a while I was seeing the ghost of the Leader of the Opposition (Mr. Stanfield) of a year or so ago, or of the hon. member for Don Valley (Mr. Gillies) retreaded, because the minister's speech was like a rereading of their speeches.
With the wealth that we have in this country and with our resources it is a real tragedy that we have so much inequality and so many inequities between those who have money and the working people who produce the goods and services.
We have a government that claims it cannot do anything for the fundamental reason that it believes in the so called free enterprise system and free marketplace. Of course that no longer exists because today we have large corporations that make the decisions affecting the lives of every Canadian. We do not have the old free marketplace. The Minister of Finance in that type of situation is like an economic eunuch. He does not have any power whatsoever to guide the economy. The only thing he can do is to point a finger at another scapegoat, and the scapegoat that he has chosen on this occasion is collectively the working people of Canada.
Liberal governments have often chosen scapegoats in the past, and now in the recent statements they made they are attacking the working people who, they say, are responsible, because of their wage demands, for a push in the inflationary spiral. They say that the trade unions are responsible. I disagree. It is a highly irresponsible statement that is far from the truth.
The Canadian Economy
I want to spend a few minutes this afternoon speaking about the government's consensus proposals. I believe these proposals are both misguided and unfair. They are misguided in terms of the entire economy, and they are unfair to the working people from one part of the country to the other. They fail to address themselves to the very serious economic problems. They constitute an economic package that runs the risk of aggravating these problems. We are now in a serious recession in our country. The real gross national product fell by 1.3 per cent in the fourth quarter of 1974. After two quarters of stagnation, today's figures show a 2.8 per cent decline in the industrial output index which, adjusted over a year, represents a drop of some 11 per cent in 1975.
All this makes it very clear that we are now in a very serious recession in Canada, despite the predictions of the Minister of Finance last November when he spoke about a real growth rate of some 4 per cent.
Unemployment at a seasonally adjusted rate was 7.2 per cent in both March and April. We now have the highest unemployment rate of any time since the summer of 1961, and economists are predicting that by the end of this year our unemployment rate is likely to hit 8 per cent, and that perhaps one million Canadian people will be looking for work between Christmas and the succeeding year. Housing starts are down for the first month of this year and are running at about 50 per cent of the rate in 1974.
It is clear that we now need a substantial stimulation of the economy to get it moving again, to build homes, and to provide jobs. Our emphasis in parliament must be to create jobs and to stimulate and expand the economy. In fact the Minister of Finance himself from time to time in the past has recognized the urgency of the problem. He had even recognized the fact that higher output and production, a buoyant economy, in the long run are the best means to combat inflation in this country.
In its speech from the throne on September 30 last the government expressed the view that "higher production, not lower, is essential to slowing down price advances". I wish that it would follow its own advice in the month of May. In the budget of November 18 the Minister of Finance said that "the first essential is action to sustain demand". In a speech to that great workers' club, The Canadian Club of Toronto, on January 27, the minister explained that:
The budget last November-was considerably more expansionary than that in May because of our recognition of the need to offset the economic drag imposed by continuing stagnation abroad.
In the same throne speech the Minister of Finance quoted with approval the review of the C. D. Howe Research Institute, as contained in its "Policy Review and Outlook for 1975," that it is an expanding economy that in time will enable us to grow out of inflation by providing the increase in real purchasing power Canadian families need to meet the increased cost of food and energy.
The Minister of Finance and his advisers said a few months ago that we need an expanding economy and we need to create jobs. But what happened to that analysis in the last few weeks? It disappeared and was replaced by an attempt, subtle and unmistakable, to lay the blame for all

May 14, 1975
The Canadian Economy
the ills of the economy on the Canadian workers for trying to grab more than their fair share of the national income. He tried to convey the idea that the greed of the Canadian workers has threatened to price Canadian business out of international markets. What he failed to tell us is that a year or two ago when we had excessive profits and price increases, it was those factors which were responsible for making our goods less competitive in the marketplace, rather than the wage increases which are still far below what the working people deserve.
Are workers getting more than their fair share? My party maintains they are not. For three years the government has let inflation go hog wild, has permitted prices to rise unchecked, and has let big corporations get away with profiteering. All this has had the effect of seriously eroding the purchasing power of wages and salaries. In real terms and as a proportion of the gross national product, wages have shown a substantial decline in the last few years.
Figures from the Canadian Labour Congress show that average wages and salaries in real terms-in terms of purchasing power-based on 1972 dollars have declined by 2.7 per cent from the fourth quarter of 1972 to the fourth quarter of 1974.
As a percentage of gross national product, wages and salaries dropped to 53.7 per cent in 1974 from a high of 55.1 per cent in 1971. During that same period corporate profits as a percentage of the GNP increased from 9.7 per cent in 1971 to 13.1 per cent in 1974. Where was the Minister of Finance when that happened? Why was he not protesting? He was dining on filet mignon and sipping champagne with his corporate buddies from Toronto's Bay Street- and the hon. member for Don Valley (Mr. Gillies). Why is he protesting now when the worker is striving to catch up because of the high profit increases of the corporations?
The Minister of Finance recognized-or in the past pretended to recognize-the merit of the argument I am making. I want to read something he said so that the minister and this parliament can realize the change of mind and heart that he has gone through. In this House on February 28 the minister said:
It is now quite understandable that wage and salary rates are attempting to catch up so as to offer some sort of compensation for the erosion of income ... as a result of rising prices over the last 18 months.
Then in a speech in Montreal on January 29 he said:
Salary demands being voiced by organized labour are not out of step with today's reality. Workers are suffering real losses because of the rise in the consumer price index.
Believe it or not that is what the Minister of Finance said a few months ago, before spring came along and he changed his colour.
In a speech to the first ministers' conference last month, before he mounted the Tory bandwagon, he said:
In many cases, the rise in the cost of living has more than wiped out the benefit an employee expected to gain from the pay increases he has obtained in recent years.
This was the minister just a month ago justifying what we see happening in the economy today. But now, having apparently recognized the justice of the workers' attempt to catch up with rising prices, he tries to do what the hon. member for Don Valley recommended a year ago-to

impose wage controls that will see the workers' income fall further behind, and so he attempts to blame our economic problems on the workers' legitimate demands.
Our party will not tolerate that, Mr. Speaker. Our party represents the working people of this country. Our party stands for the redistribution of income and wealth so that the ordinary working person in this country gets the share that he deserves. He is the person who produces, and he deserves the major of the wealth.
Are our economic problems the result of the greed of Canadian workers? Of course not. Even the Minister of Finance admitted they were not. In his budget speech last November he attributed our economic slowdown to the deteriorating economic performance of the countries to which we export, to the decline in housing starts, and to a number of other factors not related to the Canadian worker. At that time he said:
We believe that the principal threat to the growth of our production and employment comes to us from abroad.
In his speech to the House on March 13 he again expressed the view that our economic slowdown resulted from falling exports that were attributable-not to high wages in Canada-but to serious recessions in the United States, Japan, and the United Kingdom-our three largest customers.
Why, in the last few weeks, is the minister blaming the Canadian worker for the slowdown and the inflation in our economy? Again, in that speech to the Canadian Club of Toronto in January, he said:
In 1975, the growth of Canadian output will inevitably fall significantly below potential, primarily because of lagging export sales as a result of economic stagnation abroad and a slowdown in housing construction.
I suggest, Mr. Speaker, that all the alarmist talk in recent weeks about excessive wage demands threatening to price us out of world markets is nothing short of bunkum. As we say in the farmyard in Saskatchewan, it is nothing short of pure horse fertilizer, and I know the Minister of Finance realizes that. I suggest that he has adopted this tactic of laying blame at the feet of the workers in a cynical and desperate attempt to divert attention from the real problems in our economy and from the fact that he does not have any new solutions for them.
What is the minister now proposing? He is proposing wage and price controls that will not solve any of our real problems but will only exacerbate the injustices and inequities in our society, and that will have no real long term impact on inflation in Canada. He is suggesting this on a voluntary basis, but if they are to work they will have the same negative effect as compulsory controls would have if they were implemented.
The government has cleverly attempted to create the impression that voluntary price and wage controls somehow are different. I maintain they are not different, Mr. Speaker. During the last election the Minister of Finance argued that wage and price controls would not work against imported goods, which represent about one-third of the goods we consume. He was right, of course, and he is right whether controls are compulsory or mandatory. That does not make any difference, and I am sure any economist would agree with me on that.

He also argued that controls have been ineffective in moderating inflation in other countries, and he was prone to point to the experience of the United States or of the Conservative Party in Britain. Why is the minister now trying to reach consensus? If voluntary controls are to work they will have the same effect as mandatory controls, and will cause the same distortion in the economy.
I do not believe that anyone can take what the minister is saying very seriously. He is saying that the working people whose wages are out in the open are the ones who have to toe the line, that they cannot have wage increases any higher than 12 per cent or $2,400 a year, whichever is the lesser. That sort of position will discriminate against the person working as a janitor, or working as a waitress. It will discriminate against the ordinary working person of this country, but not against the man making $20,000 a year, the member of parliament, the judge, the corporate executive, the lawyer, the doctor, or any other professional person earning fees.
The Canadian Economy
developed by the provincial and federal governments. The Canadian people would control their own financial institutions, and decide what is really important for them.
We have to do this if the ordinary citizen is to share more equally in our national wealth. Surely it is the wish of the Canadian people, as it is of the NDP, to establish justice and equality in this country for one and all.


The Acting Speaker (Mr. Penner):: Order, please. It being 5.45 o'clock, it is my duty, pursuant to section 9(a) of Standing Order 58, to interrupt these proceedings and forthwith put every question necessary to dispose of the motion which is now before the House.
The question is on the amendment in the name of the Leader of the Opposition (Mr. Stanfield).
All those in favour of the amendment will please say yea.


Some hon. Members:: Yea.
I cannot take seriously any program which does not treat all Canadians equally, which does not have as its basic point and essential philosophy the notion of equality, the notion that we should narrow the gap between rich and poor, and redistribute income so that the low income person of this country will gain a greater share of our national wealth.


The Acting Speaker (Mr. Penner):: All those opposed will please say nay.


Some hon. Members:: Nay.


The Acting Speaker (Mr. Penner):: In my opinion the nays have it.
And more than five members having risen:
I notice, sadly, although with humour, that the minister forgot to tell us about interest rates. He forgot to talk about dividends, rents, and a number of other forms of income, because he represents the people in our country who get such income. He and the government govern for those people. He excludes interest rates because he thinks that the financial institutions can better look after them. He excludes dividends, because he thinks that we need large dividends in the private sector to stimulate the economy. These are things to which my party, a democratic socialist party, does not subscribe. We believe now that the priority is to stimulate the economy, to increase employment and beat inflation.
We need more production in the economy. We need to redistribute wealth so that ordinary, low income people will have a greater share of our national wealth. If we do this with significant tax cuts, these people can purchase goods and commodities, and we shall create jobs. We need to build houses; nothing stimulates employment more than the building of houses. We need to build 200,000 houses in addition to the ones already proposed or under construction. Building on this scale would stimulate the forest industry, the construction industry, and those industries which provide drapes, furnishings, carpets and other commodities which go into a house.
Our party also thinks that we need a national economic development plan under which the government, as the representative of the people, would do the planning and the investing instead of leaving this to the multinational corporations. That way we could invest according to our social priorities, not according to the dictates of the profit factor or the ledger. We would let the Canadian people make the decisions. Under such a plan our non-renewable resources would be placed under public ownership and


The Acting Speaker (Mr. Penner):: Call in the members.


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


Mr. Speaker:: The question is now on the main motion.


Mr. Speaker:: I declare the motion lost.
Alkenbrack
Allard
Andre
(Calgary Centre) Baker
(Grenville-Carleton)
Baldwin
Balfour
Beatty
Benjamin
Blackburn
Brewin
Broadbent
Cadieu
Caouette
(Villeneuve)
Carter
Clark
(Rocky Mountain) Clarke
(Vancouver Quadra) Cossitt
Crouse
Darling
Dinsdale
Douglas
(Nanaimo-Cowichan-
The Islands)
Ellis
Elzinga
Fairweather
Firth
Forrestall
Motion (Mr. Broadbent) negatived.


Mr. Speaker:: Pursuant to Standing Order No. 2 the House stands adjourned until two o'clock tomorrow afternoon.
At 6.20 p.m. the House adjourned, without question put, pursuant to Standing Order.

Thursday, May 15, 1975