1975-03-12

PRESENCE IN SPEAKER'S GALLERY OF SECRETARY OF THE TREASURY OF THE UNITED STATES, MR. SIMON

['Hear, hear!']
Hon. John N. Turner (Minister of Finance):: Mr. Speaker, I am sure hon. members would like me to extend a warm welcome to the Secretary of the Treasury of the United States, Mr. Bill Simon, who is present in the Speaker's gallery. We have had very fruitful discussions over the last 24 hours. We are very glad to have him in Canada.


Some hon. Members:: Hear, hear!


Mr. Speaker:: The Chair has received notice from three hon. members of questions of privilege. They are the hon. member for Hamilton West (Mr. Alexander), the hon. member for Kootenay West (Mr. Brisco), and the hon. member for Burnaby-Richmond-Delta (Mr. Reynolds).
All three notices pertain, on the face of it, to discrepancies or complaints about the quality of answers given by ministers in the House in recent days. I am, of course, duty bound to listen to the explanation of each member any time an hon. member gives the Chair notice of a question of privilege. In view of the fact that there are three of them, and that all three relate to a similar complaint, either about the quality of answers given by ministers or, alternatively, discrepancies between answers given by ministers in the House and statements made here or elsewhere.
I think I must caution the three hon. members that, again on the face of it, these constitute interesting questions for confrontation perhaps during the question period or other debates but probably do not, unless some other point is developed during their remarks, constitute questions of privilege.
I therefore propose, in the interests of all members of the House, to ask each of the three hon. members to develop the explanation of his question of privilege as briefly and concisely as possible.
The hon. member for Hamilton West.



Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker, I certainly abide by the ruling you have just
delivered but I would suggest that I am not involved with the quality of the answers given by the minister-to whom I shall refer subsequently-but rather the contradictory statements that have been brought to the attention of the public and members of parliament.
My question of privilege revolves around the very strange and unacceptable circumstances involving the Solicitor General (Mr. Allmand), the Hamilton Police Force, and the Ontario Provincial Police. Your Honour will recall that on March 10, as recorded at page 3928 of Hansard, I asked a question of the Solicitor General concerning the need expressed by the Hamilton city council, as exhibited on October 31, 1972 by resolution, to have a full scale open inquiry regarding activities around the Hamilton harbour. The minister replied:
Mr. Speaker, it is true that in September, 1972, some person or persons from the Hamilton city council came to the RCMP detachment in Hamilton with certain allegations of wrongdoing with respect to the Hamilton harbour. On examination of those allegations by the local detachment, the local detachment felt these were matters which gave rise to accusations under the Criminal Code and in the ordinary course such investigations should be undertaken either by the Hamilton City Police or by the Ontario Provincial Police. For that reason, the officials went to the OPP and the Hamilton City Police but the latter felt they did not have the resources necessary to carry on that kind of investigation-this is what I am told.
Further on the minister indicated as follows:
They did decide to investigate in any case, because the others were not ready to do so.
It has also been alleged that the minister has indicated that any delay was at the police level in Hamilton. According to subsequent information we can come to the conclusion, and I say this with all due respect, that the minister either misled the House or has no idea what is happening in his department. Administrative negligence and incompetence are involved here.
After the minister made those statements one would assume that he knew what he was talking about. But then there was a strange revelation which is extremely damaging to the minister. I refer to statements made not only by the chief of the Hamilton City Police but also by an inspector of the OPP. In a lead story in the Hamilton Spectator of March 11 it is indicated:
The Ontario Provincial Police and the Hamilton Wentworth regional police today denied they were ever asked to carry out an investigation into alleged wrongdoings involving the Hamilton Harbour Commission.
Solicitor General Warren Allmand said last night that any delays in the harbour investigation were at the police level in Hamilton and not at the political level in Ottawa.
And what is most important, Mr. Speaker, is that the article goes on to say:
Assistant Commissioner Ken Grice of the OPP said his department was never asked by anyone to carry out an investigation.
4016

Privilege-Mr. Alexander
Most of the next sentence appears in quotation marks and reads:
"We were never asked and only became aware of the investigation after it was well under way," he said.
The assistant commissioner then said this about the Hamilton city police:
"We have a criminal investigation branch second to none and there is no question that we were not capable of carrying out an investigation. We have handled investigations far more complex than this,..."
The article goes on to say:
Regional Police Chief Gordon Torrance also said today that he could not recall his department being asked to carry out an investigation.
"We were not asked by the RCMP or anyone to investigate," he said.
It is evident that there is a serious and major conflict between the chief law enforcement officer of the land and others. He has openly contradicted the assertion of the local police of the city of Hamilton and of the Ontario Provincial Police. I suggest that this is unprecedented. It is incumbent on members to ascertain facts. When did the investigations begin? Who started the investigations? Who called for them? Why were they delayed, and who is correct, the minister, the local police of the city of Hamilton, or the Ontario Provincial Police?
Accordingly, if Your Honour finds I have a prima facie case of privilege, I would move, seconded by the hon. member for St. John's East (Mr. McGrath):
That the whole matter of police investigations into the Hamilton harbour activities be referred to the Standing Committee on Justice and Legal Affairs.


Hon. Warren Allmand (Solicitor General):: Mr. Speaker, the information I gave to the House in the last few days with respect to this matter was, of course, information I had obtained from RCMP headquarters in Ottawa. I did not personally get in touch with the Hamilton police or the OPP in 1972. I was not even minister at that time. Neither did the officials here in Ottawa do that. I am led to believe that the contacts were made at the local official level. I have now asked for details of how this contact was made and with whom.
Let me make it clear that the main issue in this case is that there was some wrongdoing in Hamilton. An investigation was undertaken by the RCMP. The wrongdoers were found.


Mr. Forrestall:: Some of them.


William Warren Allmand: Five people have been charged, and three were found guilty. Today we charged an additional 14 individuals in this matter, and 12 more corporations. The investigation has been a very successful one, and justice is being carried out.


Some hon. Members:: Hear, hear!


William Warren Allmand: Mr. Speaker, the hon. member for Hamilton West (Mr. Alexander) is dwelling on incidents which took place at the beginning of the case, on discussions between police forces concerning who had jurisdiction. That is not the main thing; it is peripheral to the main issue. The main issue is that there was wrongdoing. An investigation has taken place and we found the people who are allegedly responsible for the wrongdoing. A large

number of charges were laid before today, and also today and, as I said, justice will be done in this case.


Some hon. Members:: Hear, hear!


Some hon. Members:: Withdraw!


Mr. Speaker:: Order, please. The hon. member for Hamilton West gave the Chair notice of his question of privilege and, in accordance with what I indicated earlier, was given an opportunity to develop the contents of the question of privilege. In fairness, the Solicitor General was given an opportunity to respond. I should simply add that nothing that has taken place since I made my preliminary remarks persuades me that the hon. member has raised a question of privilege and not a question of debate. That being so, I will call on the hon. member for Kootenay West (Mr. Brisco), who also wishes to rise on a question of privilege.


MR. BRISCO-ALLEGEDLY CONTRADICTORY STATEMENTS OF MINISTER OF STATE FOR URBAN AFFAIRS
Mr. Bob Brisco (Kootenay West):: Mr. Speaker, I rise on a question of privilege. On March 10, during the oral question period, I asked the Minister of State for Urban Affairs (Mr. Danson) the following question as reported at page 3928 of Hansard:
Has the minister written a letter or letters to Liberal members of parliament or Liberal party members asking for the name or names of lawyers in the respective constituencies who support the Liberal party with a view to awarding CMHC mortgage business to these party supporters who belong to the legal profession?
The minister replied:
In no such terms at all.
I submit that a reply of that nature couched in those terms would indicate a generalization and infer that regardless of the specifics of my question, the letter had not been written to Liberal members of parliament with reference to the acquisition of the names of Liberal lawyers who handle CMHC mortgage business. On the same day, the same minister made a statement outside the House which is a direct contradiction of the answer he provided members of this House. I am aware of the fact that Your Honour has ruled on this form of question of privilege with reference to statements made by ministers outside the House, but surely ministers have a moral obligation to avoid flirting with the truth in these chambers regardless of what they wish to say outside the House.
In effect, the minister denied the import of my question in this House, but on the same day the Toronto Star carried the news story "Liberal lawyers handle most of Ottawa mortgages" and under the picture of the minister it states "sent MP's letter." The first two paragraphs provide the truth which I sought in this House. I quote:
Legal work on "the vast majority" of mortgages issued by the Central Mortgage and Housing Corporation is handled by Liberal lawyers, Urban Affairs Minister Barney Danson admitted yesterday.
Danson made the admission after the Star obtained a copy of a "personal and confidential" letter-


Mr. Speaker:: Order, please. The question of privilege put forward by the hon. member for Kootenay West (Mr. March 12, 1975

Brisco) is a serious one, as was the previous question of privilege and as will be, I am sure, the following one. It is a matter of some concern that these questions have to be raised. I have given a preliminary view of what I feel is the correct interpretation of our Standing Orders with regard to these questions. However, I believe that any member who takes time to give the Chair notice of a question of privilege for the purpose of raising a serious point ought to be given the attention of the House.


Some hon. Members:: Hear, hear!


Robert Hylton Brisco: I will be very brief, Mr. Speaker. I continue the quotation from the Toronto Star of Tuesday, March 11:
Danson made the admission after the Star obtained a copy of a "personal and confidential" letter he sent last month to all Liberal MP's asking them to be quick when invited to recommend a lawyer to handle a mortgage from the federal corporation.


Some hon. Members:: Shame.


Robert Hylton Brisco: As matters stand at the present, we are subjected to direct contradiction of that policy. Surely, Mr. Speaker, for the benefit of all members and the people that we serve, some vehicle must be developed that will oblige members of parliament, particularly ministers, to make statements of fact in the House of Commons that will not be in conflict with statements made later outside the House.


Some hon. Members:: Hear, hear!


Hon. Barney Danson (Minister of State for Urban Affairs):: Mr. Speaker, if I may quote the hon. member's question of March 10, he said:
Has the minister written a letter or letters to Liberal members of Parliament or Liberal party members asking for the name or names of lawyers in the respective constituencies who support the Liberal party with a view to awarding CMHC mortgage business to these party supporters who belong to the legal profession?
I would not even bother rising to speak on this question of privilege except the hon. member suggested I was flirting with the truth and made statements outside the House different from inside the House. The import of his question was that I asked members for names of those who were party supporters. That is not the case. I asked for the names of legal agents-


Mr. Fairweather:: Did you ask anybody on this side of the House? No!


An hon. Member:: Who did you ask?


Barnett Jerome Danson: The hon. member's question of privilege, as I understand it, is based on the assertion that I did not answer accurately in the House. I did answer accurately in the House. I answered further questions outside. There was no suggestion regarding party supporters-simply the names of those qualified to handle this business. I have received suggestions from all sides of the House-


Some hon. Members:: Oh, oh!


Barnett Jerome Danson: -and they have been given due consideration. I find it a strange coincidence in this country that the best lawyers to handle this work in Ontario happen to
External Affairs
be Conservatives, the best in British Columbia are NDP and the best on the national scale, as always, are Liberals.


Some hon. Members:: Hear, hear!


Mr. Speaker:: The facts surrounding the question of privilege of which the Chair has given notice by the hon. member for Kootenay West are not dissimilar, basically, from those referred to by the hon. member for Hamilton West, and neither is the decision of the Chair.


MR. REYNOLDS-ANSWERS OF SOLICITOR GENERAL CONCERNING INVESTIGATION OF DREDGING CONTRACTS
Mr. John Reynolds (Burnaby-Richmond-Delta):: Mr. Speaker, my question of privilege relates to the same subject as was raised by the hon. member for Hamilton West, that is to say, the investigations being carried out in British Columbia and the answers the Solicitor General gave us on February 27 and March 7. In order to save the time of the House, having regard to your two previous rulings, Mr. Speaker, I will withdraw my question of privilege; I am sure that in the long run the people of Canada will get the answers to this sorry mess as the people of the United States did when they had the Watergate investigation.


Some hon. Members:: Oh!


An hon. Member:: Cheap!


Some hon. Members:: Hear, hear!



ROUTINE PROCEEDINGS


Mr. Walter C. Carter (St. John's West):: Mr. Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43. The Law of the Sea Conference is to take place in Geneva on March 17, 1975. Accordingly, I would move that the following motion be presented to all delegates at the conference in order to reaffirm the Canadian position on this issue, namely:
That this House accept the principle that Canada and other coastal states own the fishery resources on and over their respective continental shelves and slopes, that the management of the fishery resources is the responsibility of the coastal states, that other states may fish such resources only with the permission of the coastal state, and, further, this House agrees that in implementation of this policy Canada must provide adequate surveillance so that swift action can be taken when Canadian interests are threatened or violated.


Mr. Speaker:: The House has heard the terms of the motion. It being proposed pursuant to Standing Order 43 it cannot be debated without unanimous consent of the House. Is there unanimous consent?
28996-49V2

Order Paper Questions


Some hon. Members:: Agreed.


Some hon. Members:: No.


PUBLIC SERVICE
Mr. Rene Matte (Champlain):: Mr. Speaker, under the provisions of Standing Order 43, I seek the unanimous consent of the House to discuss matter of urgent and pressing necessity.
On view of the fact that the current conflict-


Mr. Guay (St. Boniface):: Welcome!


René Matte: Mr. Speaker, we could very well do without the comments of the hon. member who has nothing cheerful about himself but his name.
On view of the fact that the current conflict between the government and Public Service blue collar workers greatly disturbs the administration and economy of Canada, particularly with regards to the handling of feed grains, which is seriously damaging Canada's balance of payments, I move, seconded by the hon. member for Rimouski (Mr. Allard):
That the President of Treasury Board summon all employees back to work and offer them salaries in line with those paid in the private sector, so as to put an end to work stoppages in the grain industry and elsewhere.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


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


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. John M. Reid (Parliamentary Secretary to President of the Privy Council):: Mr. Speaker, the following questions will be answered today; 10, 245, 403, 553, 629, 827, 877, 909, 1,002, 1,081, 1,167, 1,205, 1,244, 1,246, 1,257, 1,291, 1,303, 1,318, 1,324, 1,328, 1,334, 1,356, 1,446, 1,448, 1,450, 1,459, 1,467, 1,468, 1,471, 1,472, 1,476, 1,479, 1,515, 1,519, 1,547, 1,549, 1,566, 1,567, 1,569, 1,572, 1,580, 1,586, 1,715, and 1,724.

Mr. Speaker, if questions Nos 40, 317, 397, 609, 1,083, 1,550 and starred question 1,530 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. Reynolds: 1.	What would be the estimated cost to the Federal Treasury if the 11 per cent federal sales tax on building materials were removed?
2.	What would be the estimated cost to the Federal Treasury if interest on the mortgages were allowed to be deductible before calculation of income tax?


John Napier Turner: 1. An
exemption from sales tax for all building materials would reduce revenue by an estimated $830 million. The proposals in the November 18 budget to reduce federal sales tax to 5 per cent on a comprehensive list of construction materials will result in an estimated revenue loss of $450 million.
2.	Allowing interest on mortgages to be deductible for income tax purposes would result in a revenue loss to the federal government approaching $1 billion.


Mr. Hnatyshyn: For the constituencies of Saskatoon-Biggar and Saskatoon-Hum-boldt, what projects have been approved by the government under the Winter Capital Projects Fund and, for each project, what were the (a) details (b) locations (c) amounts involved?


John Napier Turner: Saskatoon-lggar
(b)	(a)	(c)H.M. of Mayfield No. 406 rural municipal office	$	22,000Rosthern	construction of water main	230,000
Saskatoon School Unit No. 42 addition to Radisson
School	152,000
Saskatoon School Unit No. 42	addition to Borden School	54,000
R.M. of Laird No. 404	building to house municipal
and police dept.	44,000
Saskatoon	maintenance facilities for
transit dept.	868,840
Waldheim	street rebuilding, curb and
gutter construction	7,837
Biggar Union Hospital Board	32 bed general hospital	1,255,100Saskatoon	fire hall addition	18,000
Rosthern School Unit No. 49 addition to Rosthern
Elementary School	245,900
Rosthern School Unit No.	49	addition to Hague school	135,180Rosthern School Unit No.	49	addition to Warman school	868,920
Saskatoon-Humboldt
(b)	(a)	(c)Watson	renovations to water treatment plant	45,000Saskatoon S.D. No. 13	new elementary schools	1,900,161Cudworth	construction of water supply	37,500Humboldt	addition to arena	100,000Humboldt S.D. No. 1529	renovate public school	138,682Humboldt Collegiate Inst.	construct and renovate classrooms	1,219,493Naicam	street surfacing	69,023


Mr. Reynolds: 1.	To the knowledge of the government, did a United States Senate Subcommittee, in conjunction with the United States Department of Health, on Monday, October 7, 1974, issue a condemnation of marijuana and its harmful effects and, if so, does the Minister of National Health and Welfare intend to make these results known to the Canadian people through an educational format?
2.	Does the government intend to make the youth of this country aware of the findings of the American Academy of Science, as published in their journal Science August 23 and 30, 1974 issues, regarding harmful effects of marijuana usage?
3.	For what reason have no steps been taken by the Department to make available information and documentation on the harmful effects of marijuana to the potential marijuana users in Canada?


Hon. Marc Lalonde (Minister of National Health and Welfare):: 1. The government has received the Report of the United States Senate subcommittee entitled "Marijuana-hashish epidemic and its impact on United States Security." Twenty-four eminent researchers from a number of countries testified before the committee chaired by Senator James O. Eastland. The chairman states in the report that these hearings were convened specifically to demonstrate that a number of highly reputable scientists regard cannabis (marijuana) as an exceedingly dangerous drug. Comparable scientists and some commissions of enquiry, have failed to corroborate the extreme concern expressed by those who testified before the Senate subcommittee. The government has consistently stated that it considers that marijuana is a potentially dangerous drug. The policy announced on July 31, 1972, by the then Minister of Health and Welfare, the Hon. John Munro, made it very clear that the possession of marijuana would not be made legal because of serious concerns about the drug's effects on physical and mental health. These concerns remain unchanged as illustrated by the statement of the present minister on November 26, 1974. The government has taken steps to inform the Canadian public of the hazards involved in use of cannabis and other drugs through books, pamphlets, multi-media kits and films.
Order Paper Questions
2.	The government will continue to inform the public of hazards involved in use of marijuana and other drugs.
3.	Answered in 1 and 2.


Mr. Symes: 1.	What was the total amount of money spent in each of the fiscal years 1972-73 and 1973-74 by the Department of Finance 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: In so far
as the Department of Finance is concerned: 1. 1972-73, $284,185; 1973-74, $203,529.
2	and 3. See reply to question No. 397.
Note: Where a report was submitted the title related to the purpose of the assignment.


Mr. Cossitt: 1.	Is the Department of the Environment or any other department conducting land title research along the St. Lawrence River waterfront or on the Gananoque River at Gananoque, Ontario and, if so (a) for what purpose (b) what specific land or areas are involved (c) on what date did such research commence and by whom is it being conducted?
2.	What are all the plans the government has for the waterfront area at Gananoque, Ontario and do such plans include (a) redevelopment of the town waterfront and, if so, on what basis (b) development of waterfront recreational and boating facilities and, if so, of what nature?
3.	Has the government through any of its departments designated the Gananoque waterfront area as a priority development area and, if so, what are all the details in regard to this?


Hon. Mitchell Sharp (President of the Privy Council):: I am informed by the Departments of the Environment and Public Works as follows: 1. Yes. (a) To assess the potential for future development of harbour facilities for recreational boating and sports fishing, (b) The federal boundaries of the harbour of Gananoque. (c) This research started in Ontario in October 1974. It is being conducted by the Regional Manager, Small Craft Harbours, Burlington.
2.	At the present time, no plans have been formulated for either the redevelopment of the town waterfront or the future development of recreational boating facilities at this location.
3.	The same priority has been given to the development of the Gananoque waterfront as other locations in the province.

Order Paper Questions


Mr. Stevens: 1.	As of March 31 in each year 1968,1970, 1972 and 1974 (a) how many were employed by the Canadian Commercial Corporation (b) what would have been their aggregate salaries if all were employed for a full year (c) how many had salary levels of (i) $20,000 or more (ii) $35,000 or more (iii) $50,000 or more?
2.	What was the salary or the salary range for each of the five highest paid employees of the Corporation?


Hon. Jean-Pierre Goyer (Minister of Supply and Services):: In so far as the Canadian Commercial Corporation is concerned: 1. (a) The Royal Commission on Government Organization (Glassco Commission) in February 1963, Volume 5, recommended that "The legal identity of the Canadian Commercial Corporation be maintained but its management and staff be provided by the Department of Defence Production (Purchasing and Supply)". In 1964, this recommendation of the commission was implemented and the staff of the corporation was merged into the Department of Defence Production (Now the Department of Supply & Services.) As DSS resources are used for the operations of the corporation, the applicable man-years are included in the supply revolving fund and the administration program of the Department of Supply & Services. The estimated cost of administrative services shown in the corporation's annual report represents an apportionment of manpower and related services costs based on the volume of contractual business in a given year. Other client departments are charged on a similar basis and it is therefore difficult to determine with any precision the number of man-years involved, (b) Not applicable; (c) Not applicable.
2. Not applicable.


Mr. Stevens: 1.	From April 1, 1968 to the date this question is answered, what was the total commodity value and transportation cost incurred by the government with respect to CIDA and other foreign aid shipments carried on ships recorded in the appropriate annual issues of the International Shipping and Shipbuilding Directory as being owned by World-Wide (Shipping) Ltd. of Hong Kong, a Company in which Mr. Y.K. Pao is a Director and a substantial shareholder?
2.	For the same period, how many of such ships were chartered or part-chartered and how many liner shipments were made in such ships directly or indirectly by the government in connection with the shipment?


Mitchell William Sharp: I am informed by the Department of Supply and Services as follows: 1. Based on Lloyd's Register of Ships 1972-73 edition, which records the registered owners of ships, we can report that no tonnage was carried by World Wide (Shipping) Limited of Hong Kong. The International Shipping and Shipbuilding Directory, 1972 edition, pages 140 and 141, lists the ships in service by World Wide (Shipping) Limited. We can, again, report that no tonnage, either charter or part charter, was carried on ships in operation by World Wide (Shipping) Limited.
2. The Department of Supply and Services undertook to arrange full characters as of April 1, 1971. As concerns liner shipments, a total of 9,167 were made on behalf of

CIDA as follows: April 1, 1968 to March 31, 1969, 720; April 1, 1969 to March 31, 1970, 972; April 1, 1970 to March 31, 1971, 1,108; April 1, 1971 to March 31, 1972, 1,567; April 1, 1972 to March 31, 1973, 1,416; April 1, 1973 to March 31, 1974, 2,110; April 1, 1974 to October 31, 1974, 1,274. The department does not have the necessary resources to research the many individual commodity contracts to ascertain whether the tonnage was moved on ships in which Mr. Pao has an interest.
Note: Prior to 1971, the information is not available.


Mr. Herbert: 1.	In reference to the answer to Question No. 254, what action is taken, if any, when the trained individual does not have and cannot borrow the other 50 per cent of the costs and what action is taken, if any, when the trained individual has been unsuccessful in his or her attempts to obtain a work permit in their trade?
2.	Is training offered to a unilingual person if it is recognized that work permits or competency cards might be difficult to obtain because of the language of the individual?


Mitchell William Sharp: I am informed by the Departments of National Health and Welfare and Manpower and Immigration as follows: 1. The Department of National Health and Welfare, through the Canada Assistance Plan will share on a 50-50 basis with the provinces in the cost of work permits and tools when the province recognizes this situation as a special need. The province may supply the assistance on a 100 per cent basis. The issuing of work permits is a provincial matter.
2. Work permits and competency cards are issued by provincial authorities, who are also responsible for the content of the training courses purchased under the Adult Occupation Training Act. Moreover, every effort is devoted by the federal-provincial manpower needs committee to ensuring that training priorities match the labour market needs in each province. There are very few cases in which those completing training encounter difficulty qualifying for the work for which their course was designed. Isolated cases can only be discussed in specific terms. In offering training to an individual, the prime consideration of the manpower officer, once the individual's basic eligibility has been determined, is whether employability or earning capacity will be enhanced by the training. All pertinent factors, including language fluency, are considered in this decision.


Mr. McKenzie: 1.	What documents of any and all description (such as any type of form, records, stationery, employee directives, etc.) within the entire Department of Justice have to be translated into the French language?
2.	Retroactive to what date will all past records of the Department have to be translated?
3.	At what date must all of these translations be completed?
4.	What amount of money was spent in the years 1973 and 1974 for
translating such documents?

5.	What will be the total cost of translating all existing documents, forms, stationery, records, etc. within the Department's entire operation?
6.	What is the total additional yearly cost of ordering all new forms, stationery, etc. in two languages compared to the cost in one language?


Mitchell William Sharp: I am informed by the Departments of Justice and the Secretary of State as follows: 1. All forms, stationery, employee directives dealing with the internal operation of the department, correspondence if necessary, press releases, competition posters and memoranda to all employees.
2.	There is no requirement to translate past records except where and when any such records are put into general use or are distributed generally.
3.	Not applicable.
4.	It is difficult to provide a precise answer to the question in terms of the Department of Justice, since, in order to achieve greater efficiency, the government of Canada has consolidated all translation, interpretation and terminology services under a single administration, designed to serve all the departments and public bodies which depend on them. Costs are not apportioned according to the types of activities mentioned above. However, the total demand for translation as represented by the number of words is available for the years 1972-73 and 1973-74. The production in words for 1972-1973 was 1,529,659; for 1973-74 it was 1,602,088. On the basis of an analysis of operating costs for the translation bureau, the total operating costs are estimated at about ten cents per word for the two years in question.
5.	None. Existing documents, forms, stationery, records, etc. already meet the requirements of the Official Languages Act.
6.	There are no records of the cost of ordering new forms and stationery in two languages compared to the cost in one language.
LIP-PROJECT No. X1074


Mr. Cossitt: 1.	With reference to the Local Initiatives Programme Project Number X1074 in the name of the Silver Harbour Manor Society, what is the job designation and what are the duties of Mr. Dobbie who wrote a hand-written memo dated April 26, 1973, stating in part "...originally rejected. Has been the subject of some political pressures. Does not provide employment to those likely to be seeking work"?
2.	What is a full description of all details of the political pressures to which Mr. Dobbie refers, including in what ways and on what dates and by whom such pressures were applied and all details of the part played therein by the Honourable Jack Davis, Minister of the Environment at the time?


Hon. Robert K. Andras (Minister of Manpower and Immigration):: 1. Mr. Dobbie was a project Officer (PM3) at the time that the Project X1074 was funded. His duties at the time were to close out the files of completed projects and to assess projects for possible extension should more funds become available. Other PM3 duties: Under the general direction of a Senior Project Officer (PM4) the duties of a project officer were: (i) To analyse and evaluate project applications submitted by municipalities, communities, local organizations and groups having
Order Paper Questions
a Federal contribution of between $75,000 and $200,000. (ii) To prepare the correspondence needed to inform project sponsors as to the approval or rejection of their application. (iii) To provide advice and information to the Senior Project Officer, and, through this Officer, provides advice and guidance to the Project Officers in the Department's Regional Offices, (iv) To visit and to monitor certain already approved projects; (a) by ensuring that progress, on-site and audit reports are received at Headquarters; (b) by analysing and interpreting the above-mentioned reports, and taking needed action personally or by effectively recommending the appropriate action to be taken;
(c)	by ensuring that advance and interim payments of the Federal contribution are adequate and exact; (d) by conducting on-site visits to approved projects for the purposes of evaluating the project and reporting on progress and financial accounting, (v) to prepare written reports of analysis and correspondence to and for the Minister, Deputy Minister, National Director and Members of Parliament, in response to enquiries about approved or rejected projects, (vi) To perform any other related duties, as may be required.
2. Only the Minister of Manpower and Immigration approves or disapproves LIP applications although he does receive recommendations from Members of Parliament of all parties, from provincial governments, and from others. The Hon. Jack Davis, as Member of Parliament for Capila-no and Minister of the Environment, was in a position to give his comments on this project.


Mr. Gauthier (Roberval): 1.	How many public servants earn between $5,000 to $10,000, $10,000 to $15,000 and by $5,000 increments up to $70,000 per year?
2.	How many earn over $70,000 per year and what is their classfication?


Hon. Jean Chretien (President of Treasury Board):: 1.
163,156 public servants earn between $5,000 and $10,000. 80,476 public	servants	earn	between	$10,001	and	$15,000.25,562 public	servants	earn	between	$15,001	and	$20,000.10,408 public	servants	earn	between	$20,001	and	$25,000.4,183 public	servants	earn	between	$25,001	and	$30,000.
1,873 public servants earn between $30,001 and $35,000. 762 public servants earn between $35,001 and $40,000. 115 public servants earn between $40,001 and $45,000. 24 public servants earn between $45,001 and $50,000. 15 public servants earn between $50,001 and $55,000. 6 public servants earn between $55,001 and $60,000. 0 public servants earn between $60,001 and $65,000. 0 public servants earn between $65,001 and $70,000.
2. None.


Mr. Reynolds: With reference to the advertising done for special collectors of stamps (a) for what reason does the Richmond, British Columbia post office have a sign on the collectors wicket "Closed owing to shortage of staff" (b) how long will this situation exist and, if until after Christmas, what are people to do who want to buy special stamps, books, collections, etc. for Christmas gifts as advertised?

Order Paper Questions


Mr. Raynald Guay (Parliamentary Secretary to Postmaster General):: (a) The sign in question was not authorized by the station manager and was placed on the Philatelic Sales Counter without his knowledge by a person or persons unknown. Upon discovery of the sign, it was removed, which was within a few hours after it had been originally placed on the counter, (b) The closing of the collector's wicket was of a temporary nature only for part of one normal working day and the wicket was reopened for business later the same day.


Mr. Herbert: 1.	In the last twelve month period for which information is available, what proportion of lending in the Canadian mortgage market was by the chartered banks?
2.	By how much per annum did this percentage change in the previous five years?
3.	Does the discretion in the hands of the lenders as regards flow of funds and maintaining of interest rates create an artificial crisis in the housing market?


John Napier Turner: 1. In the 12 month period ending in August, 1974, chartered banks approved 28 per cent of mortgage loans on new and existing residential property.
2.	Percent of residential mortgage loans approved by the chartered banks. 1969, 12 per cent; 1970, 12 per cent; 1970, 16 per cent; 1971, 24 per cent; 1972, 27 per cent; 1973, 30 per cent.
3.	Many financial institutions compete for business in the mortgage lending market. Such competition ensures that the flow of funds into mortgages and that the mortgage interest rates charged by the institutions are basically set by market forces.


Mr. Herbert: 1.	Does the Quebec Code of Procedure state that only military personnel are exempt from garnishment?
2.	Do the federal authorities maintain the attitude that employees in the Public Service are also exempt?
3.	Is there any evidence that those granting credit are hampered in the recovery of their claims against federal employees?


Joseph Jacques Jean Chrétien: 1.
No reply. The question relates to a matter which falls within provincial legislation.
2. Garnishee orders in respect of wages are directed to the employer. Moneys payable by the Crown as wages to public service employees cannot be garnisheed because the courts are not able to make an order against the Crown. The legislative provisions prohibiting the garnishments of wages of public service employees is contained in Section 81 (3) of the Financial Administration Act which reads as follows: "s.81(3) Notwithstanding subsection (1), any amount due or becoming due by the Crown as or on account of salary, wages, pay or pay and allowances is not assignable and no transaction purporting to be an assignment of any such amount is effective to confer on any person any rights or remedies in respect of the amount."

The question of garnishment proceedings has been reviewed several times over the years. For a number of reasons, including some evidence of a trend to restrict the use of garnishment proceedings in other jurisdictions and the present social climate of encouraging unlimited credit, it was decided that no change should be made in the legislation. However, as a matter of policy the subject is reviewed from time to time by the Treasury Board, most recently in 1970.
3. At the recent time there is another procedure available to a creditor to obtain relief against a public servant debtor. This is by equitable execution whereby a judgment creditor may obtain from a provincial court an order restraining the judgment debtor from receiving moneys which may be due and owing by the Crown to him. At the same time, such order provides for the payment of moneys to a sheriff who is appointed as receiver for the purpose of obtaining the moneys and of giving a valid discharge therefor. This procedure is cumbersome and is not always successful, but in this procedure the order is not against the Crown.


Mr. Forrestall: What has been the cost to the taxpayer of peacekeeping in Cyprus to December 31,1974, or the most recent available and reliable date?


Hon. James Richardson (Minister of National Defence):: The cost of peacekeeping in Cyprus since inception, in March, 1964 to December 31, 1974 exclusive of personnel costs, has been $25,159,000.


Mr. Reynolds: 1.	How many of the 1975 calendars "A Lifestyle Plan for All Seasons" were distributed by the Department of National Health and Welfare?
2.	Was this calendar distributed by any other department of the government?
3.	What was the total cost of production and printing of this calendar?
4.	What were distributors costs of this calendar?


Marc Lalonde: 1. As of January 24, 1975-5,450,000 copies were distributed.
2. Information Canada.
3	and 4. Cost of production, $40,000. Cost of printing and distribution, $245,000.


Mr. Paproski: 1.	How many full-time employees were under salary in the Department of the Environment on (a) January 1, 1974 (b) January 1,1975?
2.	How many people in each of these years received salaries of (a) under $10,000 (b) between $10,000 and $20,000 (c) between $20,000 and $30,000 (d) over $30,000?


Mr. Len Marchand (Parliamentary Secretary to Minister of the Environment):: 1. (a) 10,183; (b) 10,479.
March 12, 1975

2. 1974 (a) 4040; (b) 5399; (c) 700; (d) 44. 1975 (a) 3084; (b) 6276; (c) 1008; (d) 111.


Mr. Paproski: 1.	How many full-time employees were under salary in the Department of the Solicitor General on (a) January 1, 1974 (b) January 1, 1975?
2.	How many people in each of these years received salaries of (a) under $10,000 (b) between $10,000 and $20,000 (c) between $20,000 and $30,000 (d) over $30,000?


William Warren Allmand: Ministry Secretariat
1. fa) 136
(b) 183				
2.	(a)	(b)	(c)	(d)January 1, 1974	73	42	18	3January 1, 1975 Royal Canadian Mounted Police	06	72	38	71. (a) 15,431 (b) 16,271	2.	(a)	(b)	(c)	(<dJanuary 1, 1974	5,404	9,901	122	4January 1, 1975	2,798	13,149	302	22:tThis reply includes members	of the	lt.C.M.P.	and public servants.	Canadian Penitenitary Service 1. (a) 5,780 ' (b) 6,629	2.	(a)	(b)	(c)	(d)January 1, 1974	2,015	3,591	165	9January 1, 1975 2,243 National Parole Board and Service	4,177	200	91. (a) 561 (b) 669	2.	(a)	(b)	(c)	(d)January 1, 1974	296	252	12	1January 1, 1975	297	333	18	21


Mr. McKinnon: 1.	As of December 15, 1974, to how many retired servicemen were annuity payments being made?
2.	How many became eligible for increases between January 1, 1974 and January 1, 1975 for the first time under the Supplementary Retirement Benefits Act, as a result of the passing of Bill C-220 on September 14, 1973?


James Armstrong Richardson: 1. As of December 31, 1974 (Accurate information is only available as of the end of each month) the
Order Paper Questions
number of retired servicemen, who received annuities under Canadian Forces Superannuation Act (CFSA) and under the Defence Services Pension Continuation Act (DSPA) totaled 44,158.
2. The number who became eligible for increases for the first time under the Supplementary Retirement Benefits Act between January 1, 1974 and January 1, 1975 was 1,723.


Mr. Forrestall: What specific funding level for 1973-74 and 1974-75 were provided to further development and maintenance of ocean engineering (a) at universities (b) in government laboratories pursuant to the "New Oceans Policy" statement of July 12, 1973 by the Minister of State for Science and Technology?


Hon. C. M. Drury (Minister of State for Science and Technology):: In the fiscal year 1973-74 and 1974-75, no specific funding level was provided for the furtherance of development and the maintenance of ocean engineering at universities and in government laboratories.


Mr. Forrestall: Is the government giving consideration to amending the superannuation legislation to provide for the payment of Supplementary Retirement Benefits regardless of age, provided a pension is payable in the first instance, with concurrent increases in contributions to the PSSRB Account and (a) if so, what is the status of these considerations (b) if not, for what reason?


Joseph Jacques Jean Chrétien: No,
because no desire has been expressed by contributing members of the pension plans involved to make the additional contributions required to meet the cost of such an amendment.


Mr. Herbert: Has consideration been given to transferring the responsibilities of Defence Construction (1951) Limited to the Department of Public Works and, if not, for what reason?


James Armstrong Richardson: In 1962 the Royal Commission of Government Organization chaired by Mr. J. G. Glassco, and in 1967-68 the Bureau of Management Studies and in 1971-72 the Management Review Group of the Department of National Defence all gave consideration to the most appropriate location for Defence Construction (1951) Limited. Each time this matter was considered it was agreed that in order to meet the objectives of the Department of National Defence a quick response capability was required within the department.
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March 12, 1975
Order Paper Questions


Mr. Cossitt: 1.	With reference to the answer to Question No. 24 which, among other persons, listed Barbara Head, wife of an employee of the Privy Council Office, as one of those taking French language courses at government expense while not herself a member of the Public Service, is this individual the wife of Mr. Ivan Head, who is a member of the Prime Minister's staff?
2.	What is the exact annual salary in dollars paid to Mr. Head?
3.	For what reason did the government at taxpayer's expense pay for Mrs. Head's French language courses (a) was one of the reasons because the government believed that Mr. Head's salary was not sufficient for him to pay this expense himself (b) over how long a period of time did Mrs. Head take French language courses at taxpayer's expense and what was the total annual salary of Mr. Head during that period of time?


Hon. James Hugh Faulkner (Secretary of State):: I am informed by the Public Service Commission as follows: A number of questions have been posed on language training programmes for spouses of members of parliament and senior Public Service personnel. It seems, from the points raised in each case and from previous inquiries, that some cost-related aspects of these programmes have been emphasized at the expense of other fundamental issues. It appears preferable, at this point, to provide a more comprehensive reply to questions raised in the House through clarification of these important issues. The provision of language training of spouses of Members of Parliament and senior public servants who are not themselves employed in the Public Service is founded both on legislation and on principle. Firstly, the Official Languages Act and the Parliamentary Resolution on Official Languages in the Public Service are juridical instruments which recognize and ensure the equality of status, rights and privilege of French and English in all areas of federal government action and the rights of Canadian citizens to deal with and receive services from the federal government in the language of their choice. Consequently, the government, with the support of all parties, has over a period of years, encouraged steps to enhance the bilingual character of the National Capital Region and of the Public Service at large. Secondly, the government recognizes that, as is the case in dealing with the implementation of any government policy, some costs are involved in implementing the provisions of language legislation and it is prepared to assume these costs. The government also recognizes that spouses, even though they receive no remuneration for doing so, can play a major role in assisting their spouses to carry out his or her professional responsibilities. Since members of parliament and senior executives have major representational functions in which active participation of the spouses is often required and since Parliament and the Official Languages Act dictate that Canada be represented nationally and internationally as a bilingual country, it is important that both senior executives and their spouses have a command of the two official languages. This requirement is already recognized and approved in the case of spouses of Trade Commissioners and Foreign Service Officers, whose knowledge of both official languages of Canada has proven indispensable in assisting their spouses to carry out representational or promotional duties. The same holds true for the spouses of members of parliament, affiliated to all political parties, who have participated or are presently enrolled in the

language training programmes provided through the Alliance frangaise. Furthermore, implementation of the government's policy on official languages has become increasingly important within the Public Service. Most senior executives are involved with some aspect of implementation. Assimilation of the nature of the tradition, aspirations, socio-economic factors of the other culture which is one implication of language training programmes could ensure increased effectiveness and capacity in carrying out this task. Since senior executives must deal with other government priority programmes, the knowledge and experience that their spouses may have gained from their own participation in these programmes can be of considerable practical value to them. Finally, to senior public servants already carrying, heavy responsibilities, the burden of learning French or English can indeed be heavy. And while some doubt has been expressed previously as to the validity of the need for a spouse's psychological support in such instances, it remains a realistic argument that such a support is most desirable. It appears reasonable, having seriously considered the different issues involved as well as parliament's expectations in the area of official languages that spouses of members of parliament and senior executives should have and continue to have some assistance in meeting these expectations.


Mr. Cossitt: 1.	With reference to the answer to Question No. 24 which, among other persons, listed M. Hofley, wife of an employee of the Department of the Solicitor General, as one of those taking French language courses at government expense while not herself a member of the Public Service, is this individual the wife of Mr. B. C. Hofley, Assistant Deputy Minister in the Department of the Solicitor General?
2.	What is the exact annual salary in dollars paid to Mr. Hofley?
3.	For what reason did the government at taxpayer's expense pay for Mrs. Hofley's French language courses (a) was one of the reasons because the government believed that Mr. Hofley's salary was not sufficient for him to pay this expense himself (b) over how long a period of time did Mrs. Hofley take French language courses at taxpayer's expense and what was the total annual salary of Mr. Hofley during that period of time?


James Hugh Faulkner: I am
informed by the Public Service Commission as follows: See reply to Question No. 1,446.


Mr. Cossitt: 1.	With reference to the answer to Question No. 24 which, among other persons, listed Diana Ainslie, wife of an employee of the Department of Justice, as one of those taking French language courses at government expense while not herself a member of the Public Service, is this individual the wife of Mr. G. W. Ainslie, Assistant Deputy Attorney General in the Department of Justice?
2.	What is the exact annual salary in dollars paid to Mr. Ainslie?
3.	For what reason did the government at taxpayer's expense pay for Mrs. Ainslie's French language courses (a) was one of the reasons because the government believed that Mr. Ainslie's salary was not sufficient for him to pay this expense himself (b) over how long a period of time did Mrs. Ainslie take French language courses at taxpayer's expense and what was the total annual salary of Mr. Ainslie during that period of time?
March 12, 1975


James Hugh Faulkner: I am
informed by the Public Service Commission as follows: See reply to Question No. 1,446.


Mr. Howie: Are there any plans regarding the development of a cross-Canada oil pipeline, extending it beyond Montreal to the Atlantic Provinces?


Hon. Donald S. Macdonald (Minister of Energy, Mines and Resources):: The Department of Energy, Mines and Resources reports as follows: The immediate objective is to have the oil pipeline extended to Montreal. There have been discussions with various interested parties with respect to an improvement of pipeline facilities east of Montreal but as yet no definitive proposal has been concluded.


Mr. Cossitt: With reference to the answer to Question No. 24 that included Mrs. J. F. Hudon and Mrs. Barbara Stephens among the list of wives of members of the Public Service taking French Language courses at public expense although not members of the Public Service themselves (a) are these persons the wives of Mr. L. D. Hudon, Deputy Secretary to the Cabinet and Mr. D. R. Stephens, Assistant Secretary to the Cabinet (b) what are the annual salaries of Mr. Hudon and Mr. Stephens (c) for what reason did the government use public funds to pay for such language lessons (d) what are the dates these persons attended language courses, where did they attend and what was the cost to the taxpayers in each case?


James Hugh Faulkner: I am informed by the Public Service Commission as follows: See reply to Question No. 1,446.


Mr. Cossitt: 1.	With reference to the answer to Question No. 24 that included the names of Mrs. D. H. Jones, Mrs. Evelyn F. March and Mrs. Violet B. Thomson among the list of wives of members of the Public Service taking French language courses at public expense although not members of the Public Service themselves (a) are these persons the wives of Commissioners D. H. Jones, R. M. March and J. B. G. Thomson of the Canadian Transport Commission (b) what are the annual salaries of each of these Commissioners (c) for what reason did the government use public funds to pay for such language lessons (d) what are the dates these wives attended such language courses, where did they attend and what was the cost to the taxpayers in each case?
2.	Is the Mrs. L. Arbique shown in the answer to Question No. 24 the wife of Mr. H. Arbique, Secretary of the Canadian Transport Commission (a) what is Mr. Arbique's annual salary (b) for what reason were public funds used to pay for his wife's language lessons (c) what are the dates she took such lessons, where did she attend and what was the total amount to the taxpayers?


James Hugh Faulkner: I am informed by the Public Service Commission as follows: See reply to Question No. 1,446.
Order Paper Questions


Mr. Cossitt: 1.	With reference to the answer to Question No. 24 which, among other persons, listed S. Boughner, wife of an employee of the Post Office Department, as one of those taking French language courses at government expense while not herself a member of the Public Service, is this individual the wife of Mr. A.C. Boughner, Assistant Deputy Postmaster General in the Post Office Department?
2.	What is the exact annual salary in dollars paid to Mr. Boughner?
3.	For what reason did the government at taxpayer's expense pay for Mrs. Boughner's French language courses (a) was one of the reasons because the government believed that Mr. Boughner's salary was not sufficient for him to pay this expense himself (b) over how long a period of time did Mrs. Boughner take French language courses at taxpayer's expense and what was the total annual salary of Mr. Boughner during that period of time?


James Hugh Faulkner: I am
informed by the Public Service Commission as follows: See reply to Question No. 1,446.


Mr. Cossitt: 1.	With reference to the answer to Question No. 24 which, among other persons, listed M. Pageau, wife of an employee of the Post Office Department, as one of those taking French language courses at government expense while not herself a member of the Public Service, is this individual the wife of Mr. F. Pageau, Director of International Postal Affairs Branch in the Post Office Department?
2.	What is the exact annual salary in dollars paid to Mr. Pageau?
3.	For what reason did the government at taxpayer's expense pay for Mrs. Pageau's French language courses (a) was one of the reasons because the government believed that Mr. Pageau's salary was not sufficient for him to pay this expense himself (b) over how long a period of time did Mrs. Pageau take French language courses at taxpayer's expense and what was the total annual salary of Mr. Pageau during that period of time?


James Hugh Faulkner: I am
informed by the Public Service Commission as follows: See reply to Question No. 1,446.


Mr. Reynolds: Are (a) Olympic Stamps (b) Olympic Coins classed as tax deductible items and, if they are not classed the same, for what reason?


Hon. Ron Basford (Minister of National Revenue):: Olympic stamps and Olympic coins are treated differently under the Income Tax Act. Paragraph 7(b) of the Olympic (1976) Act specifically provides that in addition to the amount of the postage rate indicated on the Olympic Action Stamp, an additional amount may be fixed for the purpose of providing financial assistance to the Olympics. This additional amount may reasonably be held to be a charitable gift, and is deductible therefore under paragraph 110(1)(b) of the Income Tax Act. The Olympic (1976) Act makes no similar provision with respect to Olympic coins, providing only that the proceeds to be received by the government of Canada shall not be less than the face value of the coins. In this case we consider that the purchaser has simply acquired a property at a price which is the total amount paid and no part of which
28996-5 0V2

March 12, 1975
Order Paper Questions
is designated to be anything other than the price of the coins.


Mr. Cossitt: With reference to the answer to Question No. 24 that included the name of Mrs. P. Morin among the list of wives of members of the Public Service taking French language courses at public expense although not a member of the Public Service herself (a) is Mrs. Morin the wife of Mr. J.M. Morin, Deputy Commissioner of Official Languages (b) what is the annual salary of Mr. Morin (c) for what reason did the government use public funds to pay for such language lessons (d) what are the dates Mrs. Morin attended such language courses, where did she attend and what was the cost to the taxpayer?


James Hugh Faulkner: I am informed by the Public Service Commission as follows: See reply to Question No. 1,446.


Mr. Mazankowski: What was the total cost of producing the CBC film, "Head, Guts and Sound Bone Dance"?


James Hugh Faulkner: I am informed by the Canadian Broadcasting corporation as follows: It has not been customary to require the CBC to supply such details of its internal management and administration.


Mr. Cossitt: 1.	With reference to the answer to Question No. 24 which, among other persons, listed Mrs. F. Juneau as one of those taking English language courses at government expense while not herself a member of the Public Service, is this individual the wife of Mr. Pierre Juneau of the Canadian Radio-Television Commission?
2.	What is the exact annual salary in dollars paid to Mr. Juneau?
3.	For what reason did the government at taxpayers' expense pay for Mrs. Juneau's English courses (a) was one of the reasons because the government believed that Mr. Juneau's salary was not sufficient for him to pay this expense himself (b) over how long a period of time did Mrs. Juneau take English language courses at taxpayers' expense and what was the total annual salary of Mr. Juneau during that period of time?


James Hugh Faulkner: I am informed by the Public Service Commission as follows: See reply to Question No. 1,446.


Mr. Knowles (Winnipeg North Centre): 1.	What was the total amount at credit in the Royal Canadian Mounted Police Superannuation Account as at (a) March 31, 1972 (b) March 31, 1973 (c) March 31, 1974?
2.	What rate of interest has the government paid for the use of this money during the fiscal years ending on the dates noted above?
3.	What amount of interest was credited to the Royal Canadian Mounted Police Superannuation Account during the fiscal years ending (a) March 31,1972 (b) March 31,1973 (c) March 31, 1974?

4.	What was the total amount paid out of the Royal Canadian Mounted Police Superannuation Account during the fiscal years ending (a) March 31, 1972 (b) March 31, 1973 (c) March 31, 1974?


William Warren Allmand: 1. (a) $223,657,501.35; (b) $269,053,974.73; (c) $315,731,881.96.
2.	(a) 5.5895; (b) 5.8969; (c) 6.1148.
3.	(a) $8,325,914.58; (b) $9,498,815.49; (c) $11,649,384.89.
4.	(a) $1,786,016.81; (b) $2,329,355.53; (c) $3,107,861.30.


Mr. Knowles (Winnipeg North Centre): 1.	What was the total amount at credit in the Canadian Forces Superannuation Account as at (a) March 31, 1972 (b) March 31, 1973 (c) March 31, 1974?
2.	What rate of interest has the government paid for the use of this money during the fiscal years ending on the dates noted above?
3.	What amount of interest was credited to the Canadian Forces Superannuation Account during the fiscal years ending (a) March 31, 1972 (b) March 31, 1973 (c) March 31,1974?
4.	What was the total amount paid out of the Canadian Forces Superannuation Account during the fiscal years ending (a) March 31, 1972 (b) March 31, 1973 (c) March 31, 1974?


James Armstrong Richardson: 1, 3 and 4. This information is tabled in the House of Commons annually in accordance with Revised Statutes, and also appears annually in the Public Accounts.
2. Rates of interest for: (a) 1971/72 Quarter ending June
30,	1971, 1.3838 per cent; Quarter ending September 31, 1971, 1.3896 per cent; Quarter ending December 31, 1971, 1.4004 per cent; Quarter ending March 31, 1972, 1.4157 per cent; (b) 1972/73 Quarter ending June 30, 1972, 1.4601 per cent; Quarter ending September 31, 1972, 1.4659 per cent; Quarter ending December 31, 1972, 1.4778 per cent; Quarter ending March 31, 1973, 1.4931 per cent; (c) 1973/74 Quarter ending June 30, 1973, 1.5042 per cent; Quarter ending September 31, 1973, 1.5252 per cent; Quarter ending December
31,	1973, 1.5364 per cent; Quarter ending March 31, 1974, 1.5490 per cent.


Mr. Marshall: During the period January 1, 1974 to January 1, 1975, how many applications for Veterans' Land Act benefits were (a) received (b) approved by the Veterans' Land Act administration?
Hon. Daniel J. MacDonald (Minister of Veterans
Affairs): (a) 7,945; (b) 7,648.


Mr. Lambert (Bellechasse): 1.	What was the average total of money in Canada on January 1 (a) 1972 (b) 1973 (c) 1974 (d) 1975?
2.	What was the breakdown of the totals on such dates in terms of (a) coins (b) bills (c) bank credits (d) deposits?


John Napier Turner: 1 and 2.
There are various forms of money in Canada. These
March 12, 1975

include currency (coins, Bank of Canada notes) and deposit claims on the chartered banks and on other institutions that offer deposit accounts to the public. The most commonly used definitions, which include currency and chartered bank deposits, are shown in the following table. Dates are for the last Wednesday in December because statistics for January 1 are not available. The table also shows the outstanding amounts of chartered bank credit in the form of Canadian dollar loans and mortgages. These statistics for bank credit are shown separately because they represent liabilities of bank customers rather than claims on the banks comparable to deposits.
Currency, Chartered Bank Canadian Dollar Deposits and Loans Last Wednesday of December (millions of Canadian dollars)
1971	1972	1973	1974Coin	483	509	581	647Bank of Canada notes	3,421	3,962	4,673	5,213Total currency	3,904	4,471	5,254	5,860Currency and demand deposits	11,763	13,142	14,843	15,794Currency and all privately-held Canadian dollar deposits	35,837	41,024	48,859	57,463Government of Canada deposits	2,459	2,540	2,368	4,682Currency and total chartered bank Canadian dollar deposits	38,296	43,564	51,227	62,145Loans and mortgages in Canadian dollars	23,286	28,677	36,739	44,260


Mr. Lambert (Bellechasse): What was the Gross National Product for (a) 1972 (b) 1973 (c) 1974?


John Napier Turner: Gross National Product	
Year	(millions of dollars) current prices 1961	prices1972	103,493	71,5151973	118,902	76,3451974	139,493	79,199


Mr. Herbert: 1.	With reference to the answer to Question No. 1,114, at the time this question was answered, what was the total strength of the RCMP in each of the provinces listed in Part 2?
2.	Of the difference between these two sets of figures, were any members of the RCMP on direct contract with municipalities or other groups, organizations, companies or individuals, not including the respective provincial governments and, if so, how many?
Order Paper Questions


William Warren Allmand: 1. Newfoundland, 531; Manitoba, 880; British Columbia, 3,045; Saskatchewan, 1,055; Nova Scotia, 568; New Brunswick, 470; Alberta, 1,505; Prince Edward Island, 111; Total 8,165.
2. Municipal Contracts: Newfoundland, 51; Manitoba, 181; British Columbia, 1,207; Saskatchewan, 172; Nova Scotia, 32; New Brunswick, 51; Alberta, 292; Prince Edward Island, 9; Total 1,995.


Mr. Jones: Is the rebate presently being given by automobile companies on the purchase of certain automobiles taxable for income tax purposes?


Stanley Ronald Basford: The
rebates presently being given to the public by automobile companies on the purchase of certain automobiles will not be taxed as such. The rebates are viewed as a reduction of the cost of the purchased automobile. Accordingly, if capital cost allowance in respect of the automobile is allowed as a deduction in computing a taxpayer's income, the amount of capital cost allowance available to such taxpayer will be affected by such rebate.


Mr. Flynn: How many wire-taps and other electronic surveillance authorizations have been issued since the Protection of Privacy Act came into
effect and, in each case, to whom?


William Warren Allmand: During the period July 1, 1974 to December 31, 1974, 140 authorizations were issued to the Royal Canadian Mounted Police. Information concerning the number of authorizations issued under provincial jurisdiction is not available.


Mr. Francis: 1.	(a) Has the government spent over $1 billion in nuclear research and development (b) has it offered to pay one-half of the cost of the first nuclear station built in any province (c) is it committed to the development of nuclear energy in Canada?
2.	What research, if any, has been done on the environmental effects and health hazards involved in such a programme?


Donald Stovel Macdonald: 1. (a) Yes. (b) No. However, the Minister of Energy, Mines and Resources announced at the First Ministers' Energy Meeting January 1974 that the federal government would provide financing assistance by offering loans, at crown corporation rates, for up to 50% of the capital cost of the first nuclear powered generating unit in a province, and, similarly, for a unit intended for regional use. (c) Yes.
2. Extensive research has been, and is being, conducted by many countries throughout the world, including Canada. These studies have served as the basis for the recommendations of the International Commission on Radiological Protection which, in turn, are the basis of the Health and Safety Regulations under the Atomic Energy Control Act.

Order Paper Questions PICKERING RADIO-ACTIVE LEAKS


Mr. Francis: Did a spokesman for Ontario Hydro say in a press conference about the Pickering radio-active leaks that many worse things have happened and, if so, what are they?


Donald Stovel Macdonald: We have no definite knowledge of any such statement. There have been no events at Pickering which released significant quantities of radio-active material to the environment nor jeopardized the safety of the reactors.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Coates: 1.	On how many occasions between May 8 and July 8, 1974, were government aircraft, of either the Armed Services or government departments or agencies, used by Cabinet Ministers or the Prime Minister?
2.	For each instance, what was (a) the specific date (b) the name of the Cabinet Minister or the Prime Minister (c) the point of departure (d) the destination (e) the interim stop(s) if any (f) the passenger list?
3.	In any of the above instances, was the government reimbursed for the use of the aircraft and, if so (a) in which specific instance or instances (b) how much was the federal treasury reimbursed (c) who determined the rate of payment?
Return tabled.



PUBLIC SERVICE-INFORMATION OFFICERS AND SUPPORT STAFF

Mr. Orlikow: 1.	For each federal department, how many information officers and support staff were employed January 1, 1973 and January 1, 1974, by job classification (support staff, trainee, IS 1-6) and salary range?
2.	For each department, how many information officer positions were vacant on January 1, 1973 and January 1, 1974 by job classification and salary range?
3.	For each department, what duties and responsibilities were handled by each information officer as of January 1, 1974?
4.	For each department, what is the total amount to be spent in 1974-75 on information services, including salaries and wages?
Return tabled.



DEPARTMENT OF FINANCE-CONSULTANTS

Mr. MacKay: 1.	From the 1968 fiscal year to date (a) how many consultants were hired (b) what were the terms of reference and time length of the work assignment (c) what was the amount paid to each (d) what was the name of each for the Department of Finance?
2.	What are the names, positions, number and salaries of public servants for the Department of Finance that held a position similar to that of the outside consultant hired by the government?
Return tabled.



LIP-ALLOCATION OF FUNDS IN CONSTITUENCY OF MOUNT ROYAL, QUEBEC

Mr. Cossitt: 1.	What was the total amount of money allocated under the Local Initiatives Programme for 1973-74 in the constituency of Mount Royal, Quebec (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-CULTURAL CENTRE, TORONTO

Mr. Cossitt: 1.	With reference to the information contained on page 18 of the Minutes of Proceedings and Evidence of the Standing Committee on Public Accounts dated November 21, 1974, to the fact that persistent representations were made by the Honourable Stanley Haidasz, former Minister of State for Multiculturalism on behalf of the Local Initiatives Programme grant for a cultural centre in Toronto (a) what was the LIP project number (b) what were the names and addresses of all those (i) signing (ii) recommending adoption of the application (c) what was a full description of the project (d) what was the amount of funds granted (e) on what dates was such payment made?
2.	Will the Minister of Manpower and Immigration make public all documents attached to and included in the file pertaining to this project?
3.	(a) On what date was this project originally rejected (b) in what ways did it not meet the criteria of the Local Initiatives Programme (c) what is the identity and job designation of all persons having a part in the original rejection?
4.	(a) With reference to a statement on page 98, section 7 of the Auditor General's Report for 1973 to the effect that this project was approved for $100,000 on January 4, 1973, "after persistent representations on behalf of the sponsor", will the Minister make public copies of these representations and the nature of his replies thereto (b) what are all the reasons the Minister ordered adoption of this project after it was first rejected (c) will the Minister issue a report on the political considerations involved?
Return tabled.



OIL SPILL CLEAN-UP EQUIPMENT

Mr. Munro (Esquimalt-Saanich): 1.	Are there inventories of oil spill clean-up equipment on hand in the (a) Juan de Fuca-Inside Passage area south and east of Vancouver Island (b) West Coast of Vancouver Island (c) Queen Charlotte Islands area (d) Prince Rupert area and, in each case (i) how many slick-lickers are there (ii) how much of the absorbent "Graboil" is there (iii) what other equipment such as booms is there (iv) where is such stock stored?
2.	If no such stock is on hand with the Department of the Environment or the Department of Transport, what arrangements are in existence to deal with an oil spill, large or small, in an emergency?
Return tabled.



NUMBER OF CANADIAN ARMED FORCES PERSONNEL ON PENSION

Mr. Knowles (Winnipeg North Centre): March 12, 1975

1.	In each year 1959 to 1974, both inclusive (a) how many personnel of the Canadian Armed Forces have commenced drawing pensions under the Canadian Forces Superannuation Act (b) how many widows have commenced drawing pensions under the said Act?
2.	In each year 1959 to 1974, both inclusive, how many pensions under the Canadian Forces Superannuation Act (a) to retired Canadian Armed Forces personnel (b) to widows of such personnel, have been discontinued because of the death of the annuitant?
3.	In each year 1946 to 1974, both inclusive, how many service personnel contributed to the pension or annuity account under the former Part V or under the provisions of the present Canadian Forces Superannuation Act?
Return tabled.



MOTIONS FOR PAPERS

John Mercer Reid: Mr. Speaker, I ask that all notices of motions be allowed to stand.


Mr. Speaker:: Is that agreed?


Some hon. Members:: Agreed.



ORAL QUESTION PERIOD


Mr. James A. McGrath (St. John's East):: Mr. Speaker, I should like to direct a question to the Solicitor General arising out of the very serious charges that have been laid today against certain individuals and firms in Canada regarding dredging contracts with the federal government and the government of Ontario. Would the Solicitor General now tell the House whether any other investigations are underway into any other firms or individuals with respect to any other dredging contracts in any other parts of the country?


William Warren Allmand: Mr. Speaker, as I pointed out earlier, criminal charges were laid this morning against 12 corporations and 14 individuals for fraud and bid rigging of government contracts, the fraud totalling over $4 million. I understand that investigations are still underway. It is possible that as more evidence develops this will, in turn, lead to other investigations.


James Aloysius McGrath: A supplementary question, Mr. Speaker. In light of the dimension of the charges and the substantial amount of federal government funds involved, would the Solicitor General now make a statement to the House-and I ask him to do this because of his evasive and misleading answers during the last few days-
Oral Questions


Some hon. Members:: Oh, oh!


James Aloysius McGrath: -regarding the scope of the investigations now underway?


William Warren Allmand: Mr. Speaker, it is difficult to take the hon. member seriously when he makes such ridiculous statements. I have been making as complete answers as possible in the circumstances to all questions put on these matters but, as I told the House before, it is against the public interest to reveal details of an investigation while the investigation is still underway. It would be counterproductive for an investigation to give publicly details of the investigation; and if the investigation proved negative, it would be harmful to the persons who were being investigated.


James Aloysius McGrath: A final supplementary question, Mr. Speaker. I might just say that anyone who examines the minister's replies in the House over the past ten days will find it difficult to take him seriously at any point. I ask the minister, because of the grave seriousness of this matter, whether he is now prepared to explain to the House, in view of the fact that the Ontario provincial police and Hamilton district police have denied any involvement in the investigation or that they were ever in fact requested to launch an investigation, how come it took five to six months to get this investigation underway?


William Warren Allmand: Obviously, Mr. Speaker, the hon. member has not been listening too closely. I told the House on a previous occasion that, in the first instance, certain persons or a person from the Hamilton city council approached the Hamilton detachment of the RCMP and put forward certain allegations, which were vague at that time, with respect to wrongdoing in regard to Hamilton harbour. After preliminary examination of these allegations the RCMP and the detachment felt that this was a matter for provincial jurisdiction, since it concerned wrongdoing under the Criminal Code, and suggested to the person or persons involved that they go to the provincial or city authorities. I understand approaches were also made to the provincial and city authorities.
At a later date the matter came back to the RCMP detachment in Hamilton and in due course it worked its way up to the top level in Ottawa, and an investigation was authorized by the Department of Transport and the RCMP. I should like to make very clear to the House-and it seems that the opposition just cannot see this-that this has been a very successful police investigation. A large number of charges have been laid, people have already been found guilty and trials are pending. How the hon. member can suggest that anything is being covered up, I do not know; that is complete nonsense.

March 12, 1975
Oral Questions


INDUSTRY
Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, my supplementary question is addressed to the Minister of Industry, Trade and Commerce. In view of the fact that this minister last week also left the impression with the House and the public that he was unaware of the seriousness of the allegations and charges which have been made public today and yesterday, in view of the fact that he announced that the most recent $265 million contract to Marine Industries Limited was going to go ahead as normal, and in view of the fact that that particular company yesterday in Toronto was charged under the Income Tax Act and that today the company was charged with an attempt to1 defraud two governments as well as the Hamilton Harbour Commission, and in view of this very serious allegation against officers of that particular company, would he now direct the Export Development Corporation to at least hold in abeyance, or somehow temporarily suspend, or make out some sort of trust arrangement so that money is still under the direct control and supervision of the government in some way pending the determination of criminality in respect of that particular company?


Hon. Alastair Gillespie (Minister of Industry, Trade and Commerce):: Mr. Speaker, I should like to make it quite clear that Export Development Corporation financing does not provide for loans directly to the corporations. This involves loans made to the buyers for the purpose of acquiring capital goods from Canadian suppliers. On the other point alluded to by the hon. member involving the question of payments in respect of existing programs under shipbuilding assistance, some payments are due or are coming due, and I have asked my department to seek legal clarification in respect of whether those payments should be made.


Allan Frederick Lawrence: Mr. Speaker, could the minister tell us the extent of the holdback in respect of the existing contracts he is talking about, and indicate the policy and intent with regard to the $265 million contract he announced last week as well as what he is now referring to when he says that, as he so gently puts it, he is seeking a clarification of legal implications?


Alastair William Gillespie: Mr. Speaker, I cannot tell the hon. member the amount of the payment that is coming due, but I would be very pleased to provide him with that information. I have tried to make it very clear to him that we are seeking legal clarification as to whether this payment should be made, and I hope to be able to announce a decision on that in the very near future. As to Export Development Corporation financing, I think it is important that the House understand that the $265 million contract to which the hon. member alluded is a contract between Marine Industries and the buyer, I believe a Greek corporation of some 12 vessels. That particular contract will be financed on the basis of approximately 40 per cent in the form of a loan by the Export Development

Corporation to the buyer, not the manufacturer or exporter, supported by roughly 30 per cent from the private sector, the commercial banking system, and the balance, of course, by the shipbuilder himself.


TRANSPORT
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I have a question for the Acting Prime Minister and I choose my words with care.


An hon. Member:: For the first time.


Some hon. Members:: Oh, oh!


John Edward Broadbent: I hope the minister will choose his answer with equal care. In view of very serious charges laid by the Crown in Ontario involving political kickbacks and influence peddling in the Hamilton area, and considering that one of those charged today as the result of investigation into harbour dredging contracts was and may still be a very senior official of the Liberal party of Canada, will the Acting Prime Minister set up a commission under the Inquiries Act to investigate all dredging contracts and the possibility of related political wrong doing?


Mitchell William Sharp: Mr. Speaker, the brief answer to the question is in the negative. I believe that if justice is to be done it should be permitted to take its course, and I think the intervention of any other proceeding such as has been suggested would compromise the outcome.


John Edward Broadbent: Mr. Speaker, I will put my question in a different way for clarification purposes and in the hope it might produce a different answer. In view of the fact that it is not only important that justice be done in politics, but that it be seen to be done, particularly as that relates to people in important political positions being cleared of any possible compromising circumstances that may not involve illegality but would potentially involve what appropriately could be called or considered political wrongdoing, in the sense of influence peddling, and I ask the question in that sense, will the Acting Prime Minister and the government not agree that the best way of clearing up this very important matter of public integrity in terms of governmental implementation of policy would be through a public inquiry?


Mitchell William Sharp: Mr. Speaker, I can only repeat the answer I have just given. I suggest to my hon. friend that if there are allegations of this kind they should be made and should not be insinuated. If the hon. gentleman wants to make charges, then I suggest he should make them, and not only would justice be done, justice would be seen to be done.


Mr. Knowles (Winnipeg North Centre):: I rise on a point of order, Mr. Speaker. I suggest it is not in keeping with the practice of this House everytime something like
March 12, 1975

this comes up for the government to call for the laying of charges. The hon. member for Oshawa-Whitby made no charges, but he alluded to charges that have been made in the courts, and I suggest he has the right to ask that matters relating to those charges be cleared somewhere other than in this political arena.


Mitchell William Sharp: On the same point of order, Mr. Speaker, I think it has been one of the principles that you, your predecessors and all members have upheld, that when statements are made in the House either on the basis of newspaper reports or from third parties, some responsibility should be taken by those who use them.


Some hon. Members:: Hear, hear!


Mr. Baldwin:: Mr. Speaker, I have a supplementary question which arises primarily from the point of order. Having in mind the intimations that have been made in the press and in other places outside this House, does the Acting Prime Minister not consider there have been sufficient prima facie allegations which justify-


Some hon. Members:: Oh, oh!


An hon. Member:: Prima facie allegations!


Gerald William Baldwin: -which justify the government, that has the responsibility for overseeing political turpitude and misdemeanors, taking the initiative to commence proceedings through an inquiry to determine exactly what the facts are?


Mitchell William Sharp: Mr. Speaker, the answer again is in the negative. I do hope that hon. members opposite will let the course of justice continue and not engage in the kind of insinuation and innuendo which they are engaged in now, and which are laying the foundations for a series of pseudo allegations being made outside the House.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Order, please. The hon. member for Winnipeg North Centre has raised on a point of order which was contributed to in the final analysis by a supplementary question put by the hon. member for Peace River. To keep the record straight, the fact of the matter is that the answer or its quality in relation to the suggestion that allegations of this sort ought to be backed up by the hon. member who poses the question, and any comments on the quality or the nature of the answer, are really legitimate causes for debate but do not constitute a point of order.


Mr. Nowlan:: Mr. Speaker, my point of order arises from the last remarks of the government House leader, and relates directly to a specific question I tried to put through you to the Minister of Transport with regard to the first time that knowledge was obtained of the allegations made in the Hamilton harbour affair. The rules of the House under Your Honour's direction prevented the then minister of transport from answering a question which went back many months to an earlier time than anything we have heard today. I say to Your Honour, with all due respect, that the government House leader, in his insinuations and in his last remarks, completely overlooked the recent history that on the other side of the border there
Oral Questions
were both congressional investigations and court proceedings. Does the government House leader not make any distinction between criminal conduct and political misconduct, political stupidity or administrative incompetence?


Some hon. Members:: Hear, hear!


Mr. Speaker:: Order, please. Basically, the hon. member is returning to the same point. The fact of the matter is that if the President of the Privy Council or any other minister chooses to give an answer of that nature to any question at any time, the kind of answer given may be the subject of legitimate comment either inside or outside the House. However, the fact is that the kind of answer given by any minister is his choice, an^ in fact he can choose not to give an answer at all. So this, does not constitute a point of order.


John Edward Broadbent: Mr. Speaker, the Acting Prime Minister, in alluding to one of my questions-and I got the gist of what he said if not the precise words-referred to vague allegations or press reports-I see he nods in agreement- on which he said I based my question. I want to put on the record that I did not base my question on some imprecise information. It is my understanding that charges have been made today, in the courts of Canada against Mr. Hugh Martin who, I understand, was a former chairman of the federal Liberal campaign committee and is a participant in the court proceedings on this important subject matter which has been the subject of political questioning in the House for some time.
Also on this point of order, I referred to charges that were laid, not by a politician but by an attorney of the Crown in Ontario. In his words, there was political influence peddling of some kind involved. That is why my point was not based on vague allegations or press reports but on serious charges made by serious people, and I put this question to the minister: would it not be in the best interests of politics in Canada to get away from partisan bickering of this kind-


Some hon. Members:: Oh, oh!


John Edward Broadbent: -and have a public inquiry conducted by a judge of the Supreme Court of Canada so that we could get back to other important political matters in the House of Commons?


Mitchell William Sharp: Mr. Speaker, perhaps the best evidence of the impartiality of the proceedings that are now being followed is that this gentleman is being prosecuted.


Mr. Brewin:: Speaking on the same point of order, Mr. Speaker, I understand the Acting Prime Minister to have said that this matter should be left to the courts of justice. I want to point out that the cabinet of which he is a member has the authority to cause an inquiry to be conducted by a judge of the Supreme Court or any one else the government wishes to appoint to deal with any matter for the sake of good government of Canada. I want to suggest to the Acting Prime Minister that this matter, far beyond the criminal charges laid, involves the good government of the country.

March 12, 1975
Oral Questions


Some hon. Members:: Hear, hear!


Francis Andrew Brewin: In the words of the Inquiries Act, this involves the conduct of any part of the public business thereof. I say to the Acting Prime Minister, in this case that comes before parliament it is more than obvious that a full and independent inquiry is required.


Mitchell William Sharp: Mr. Speaker, as my colleague, the Solicitor General has said, the RCMP have initiated inquiries that have led to a number of prosecutions. Some were found guilty and others must be presumed to be innocent until they are found guilty. I believe that it would not serve the cause of justice at present to follow the suggestions of the hon. member.


SARNIA-MONTREAL PIPELINE-DURATION OF AGREEMENT WITH INTERPROVINCIAL PIPELINE TO COVER FIXED COSTS
Mr. Gerard Laprise (Abitibi):: Mr. Speaker, I should like to put a question to the Minister of Energy, Mines and Resources.
It is a question which I feel is as important as the one previously discussed. In view of the fact that the minister has just announced that an agreement has been concluded between the federal government and Interprovincial Pipeline Ltd., could he tell us whether under that agreement, the guarantee by the Canadian government to make up the probable deficit as a result of a shortage of oil to be carried will be in effect for an undetermined period or a specific term?


Donald Stovel Macdonald: Mr. Speaker, first I must say that we have not yet closed the contract with Interprovincial Pipeline. Supplementary estimates are now being considered by the national resources committee and the contract is being discussed by that committee.
But if the minister is authorized by Parliament to carry out such a contract, there will then be an obligation, for the whole period of the bonds, of the 20-year investments, to give such a guarantee in the event the supply of crude oil from Sarnia to Montreal is cut off.


Gérard Laprise: Mr. Speaker, I should like to put a supplementary.
In view of the announcement made recently that oil supplies in western Canada are almost exhausted, does the minister still believe that the pipeline is needed to bring oil that will no longer exist in four or five years?


Donald Stovel Macdonald: Yes, Mr. Speaker. I must point out that the National Energy Board has indicated that until 1983, there will be ample supplies of oil for the eastern Canada market. If there should be such a cut-off of supply for the eastern Canada refineries, the pipeline being a reversible one might be used also for the Toronto and even perhaps the Sarnia refineries.


ROYAL CANADIAN MOUNTED POLICE
Lincoln MacCauley Alexander: Mr. Speaker, I should like to direct my question to the Solicitor General in light of the serious contradictions between the statements of the Solicitor General, the Hamilton police and the OPP.


Some hon. Members:: Order.


Lincoln MacCauley Alexander: Now that the OPP and the Hamilton police have indicated that they have never been asked to investigate the Hamilton harbour activities, does the Solicitor General still maintain that they have been asked to do so? We would like to try to clear up this contradiction, and I hope the minister will give me an answer.


William Warren Allmand: Yesterday afternoon when I heard about this response from the Hamilton police and the OPP I checked once more with the RCMP here in Ottawa and they told me to stand by what they told me originally. I have now asked them for more details about the contacts that were made and I will give this information to the House as soon as I have it.


HAMILTON HARBOUR DREDGING CONTRACTS-IDENTITY OF PERSON REQUESTING HAMILTON POLICE AND OPP TO INVESTIGATE
Lincoln MacCauley Alexander: I have a supplementary question for the minister who does not seem to have known what he was talking about on March 10. I wonder if the minister can now look into his records, which I know he has, in order to determine who asked whom what with respect to the police and the OPP, whether it was his officials or the RCMP who went to the Hamilton police and the OPP, and would he identify him, or whether it was a member of the city council of Hamilton, and would he identify him and say where it was. Will the minister look into those records in order to give us his answers when he is replying to the other statement?


William Warren Allmand: Mr. Speaker, I explained to the House that these matters are not listed in my records.


An hon. Member:: Why not?


Lincoln MacCauley Alexander: Not your records, in the RCMP records.


William Warren Allmand: The hon. member said when I looked in my records. He should be more precise. When the question was raised in the House, I followed the usual channels. I checked with the RCMP in Ottawa. They, in turn, checked with the RCMP in Hamilton, and the information came through that way.


An hon. Member:: Blame the mounties.
March 12, 1975


William Warren Allmand: Mr. Speaker, we have a real smart guy over there.


Mr. Speaker:: Order, please. Perhaps the minister will confine himself to answering the question.


William Warren Allmand: If the opposition thinks there is any contradiction between what I am saying and what the RCMP have on record, my estimates will be before the committee in a day or two and the RCMP will be there. Hon. members can come and put the same questions to the RCMP.


Some hon. Members:: Oh, oh!


Lincoln MacCauley Alexander: It seems to me that the minister is abdicating his responsibility. The minister knows darn well that when I talk about records, I talk about the records of the Royal Canadian Mounted Police for which he has responsibility. All we want is the truth. Will the minister, as I said, look into the records of the RCMP and determine whether it was his officials who first went to the Hamilton police or the OPP and who it was, or whether it was a member of the city council, and when; the records should reveal that. I am not talking about the records of the Solicitor General. I am talking about the RCMP records for which he has responsibility.


William Warren Allmand: Mr. Speaker, I already said at the beginning of the question period that I would do that. The hon. member has not been listening.


Some hon. Members:: Hear, hear!



THE CANADIAN ECONOMY


Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, I sense that the Minister of Finance is feeling neglected this afternoon.


An hon. Member:: Did he write you a note?


Robert Lorne Stanfield: With friends like that the Minister of Finance hardly needs enemies.
I would like to ask the Minister of Finance, following what he described as his fruitful conversations with Mr. Simon, the Secretary of the Treasury of the United States-


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: -whether, having had the benefit of those conversations he is now in a position to act upon or even speak about any new initiatives to improve the Canadian economy.


Mr. Muir:: Why don't you get Simon for leader, John? He'd be a big improvement.


An hon. Member:: In what party?


Some hon. Members:: Oh, oh!
Oral Questions


John Napier Turner: Mr. Speaker, we had some thorough conversations between ourselves and we also had the benefit of the reaction of the Secretary of the Treasury to comments put to him by several of my colleagues having economic portfolios. We will want to digest what he has said and his analysis of the American economy in due course as we reflect upon the stimulus already injected into the Canadian economy and the way in which a package of measures can be worked out between the United States administration and congress both in the energy field and in the economic field. Then, at an appropriate time, I will be back before the House.


An hon. Member:: Did he sell you a ratchett?



INFLATION-OBJECTIVE IN SEEKING CONSENSUS OF VARIOUS GROUPS

Robert Lorne Stanfield: Mr. Speaker, I do not know whether Mr. Simon sells ratchetts, but the minister expressed concern about strikes and creating more unemployment, and he also expressed concern about the escalation in the level of wages as a result of settlements in this country. In view of the fact that the only activity we see these days in the Department of Finance, apart from the elimination of the group of seven from the Prime Minister's office, is the so-called consensus effort, can the minister now tell us upon what the government of Canada has been seeking co-operation? Yesterday the Acting Prime Minister said to me that I was expecting something which is not there. I want to know what is there.


John Napier Turner: The hon. gentleman and I have had several exchanges, some at length and some in a fairly curtailed way within the rules of the House at this stage of the proceeding. I can say to him, as I said to the Standing Committee on Miscellaneous Estimates yesterday, that the rise in the rate of inflation is still not satisfactory despite some easing of the rate on an annual basis, below double digit. The rate is unsatisfactory despite the fact that an easing in wholesale prices and commodity prices will work its way through the economy, but the most disturbing feature of the current situation is the cost increases to which the hon. gentleman alluded reflecting wage settlements now running at roughly more than twice the rate of settlements in the United States. If these settlements in Canada continue at this comparative rate, Canada will find itself in an increasingly difficult position in our competitive ability in the world. This will jeopardize our exports and threaten Canadian jobs. I have said during the consensus process-


An hon. Member:: Oh, oh!


John Napier Turner: If the hon. gentleman had as much patience as he has throat, he would be a far more useful member of parliament.


Some hon. Members:: Hear, hear!


John Napier Turner: As I have said to leaders of business, leaders in the labour movement, in the professions and leaders of agriculture, I quite understand

March 12, 1975
Oral Questions
the urge to catch up with respect to wages and prices. What is dangerous is that current settlements are anticipating rates of inflation which project the rate effective in 1974, and if this continues to happen, it will become a self-fulfilling prophesy and this country will be put into a very dangerous international position.


An hon. Member:: What are you doing about it?


Robert Lorne Stanfield: Mr. Speaker, the minister must recognize that he did not even remotely answer my question. I would like to ask him how much patience he expects me or any member of this House to have with regard to a consensus program which was promised as long ago as the Speech from the Throne and which has been followed only by postponement and evasion. I and my colleagues have been prepared to exercise restraint and to withhold demands for stimulation in the economy in order to give the minister a reasonable time to get his consensus plan into operation and to give him more freedom of action. In response to that patience, I want the minister to give me the assurance that before the Easter recess he will give the House an open and frank statement as to what this consensus program is all about.


John Napier Turner: 

FOREIGN INVESTMENT REVIEW ACT


Hon. Herb Gray (Windsor West):: Mr. Speaker, I have a question for the Minister of Industry, Trade and Commerce. Has the government agreed to the requests of the provincial governments to further delay proclamation of Part II of the Foreign Investment Review Act and, if so, will this delay be for an indefinite period or has the government now set a date by which time the second part of the act dealing with new investment will be proclaimed in force?


Alastair William Gillespie: Mr. Speaker, I think the provincial ministers and I had a very useful and constructive meeting yesterday. We reviewed the administration of Part I and the provinces agreed on the six principles of consultation. We also discussed the question of the guidelines which are an integral part of the Part II proclamation. Provincial ministers asked for more time to consider and understand an admittedly complicated set of guidelines. The House may remember that I put forth a set of guidelines at the end of 1973 and asked for comments from the provinces and from industry. We put forward another set of draft regulations after consideration. I would expect there would be a meeting within the next three weeks at the deputy minister level of the various provinces with senior officials of the Foreign Investment Review Agency to

conclude the consultation process with respect to those guidelines and the preparatory steps for second proclamation.


Herbert Eser (Herb) Gray: A supplementary-


Mr. Speaker:: The hon. member for Yorkton-Melville.


An hon. Member:: He has a supplementary.


Mr. Speaker:: The hon. member for Yorkton-Melville.


Some hon. Members:: Oh, oh!



TRANSPORT


Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, my question for the Acting Prime Minister goes back to the first topic today. In view of the fact that he has not agreed to a public inquiry under the Inquiries Act will the Acting Prime Minister agree to an investigation in order to determine whether those corporations and individuals who have been charged have made contributions to political parties and if so, to which parties, how much and when?


Mitchell William Sharp: The
answer is no, Mr. Speaker.


Lorne Edmund Nystrom: A supplementary question, Mr. Speaker. In view of the fact that under the investigation that is being carried out this type of thing will not come to light because the election legislation was not proclaimed until August 1, will the Acting Prime Minister agree to investigate the political connection between those charged and-


Mitchell William Sharp: Mr. Speaker, I would remind the hon. gentleman that the presumption of innocence until proven guilty is fundamental to our system.




Mr. Claude Wagner (Saint-Hyacinthe):: Mr. Speaker, I would like to ask the Acting Prime Minister a question. I hope, Mr. Speaker, that my hon. friends opposite do not rejoice too much in the tribulations of the "in-laws", in Quebec.
Here is my question, Mr. Speaker, which is directed to the Acting Prime Minister: given the surprising development of the dredging contracts affair, and considering that on this subject the market is in such a state and that for all practical purposes real competition is impossible, as emphasized recently by the Minister of Transport, would the minister now feel that the lesson has been learned and
March 12, 1975

that on the strength of that he should suggest to the cabinet that the Department of Transport buy its own equipment and do its own dredging, in the same manner as it already looks after buoys and icebreaking operations?


Mitchell William Sharp: Mr. Speaker, I thank the hon. gentleman for his suggestions. We have great confidence in the Minister of Transport, too. But there is a serious problem in connection with the ongoing work of dredging that may have to be done in this country. Most of the companies involved in dredging have been named in the prosecution. I would not necessarily accept his suggestion about nationalization, but I recognize the problem that exists.


Claude Wagner: Mr. Speaker, I should like to put a supplementary to the Minister of Transport.
As he seemed to nod his head in approval a while ago, I should like to ask him whether he is willing to approve this idea and expose his views on the subject?


Hon. Jean Marchand (Minister of Transport):: nodded in approval, Mr. Speaker, for the simple reason that I feel the idea is worth considering. The situation in Canada is not the same everywhere; that is to say that, if we talk of the west coast for instance, dredging can go on 12 months a year and depreciation of the equipment can be spread over 12 months; the same does not apply to eastern Canada where ice naturally brings the use of the equipment to a standstill in November. The idea is therefore worthy of consideration, which is what I wanted to indicate when I nodded.



PUBLIC SERVICE


J. Michael Forrestall: Mr. Speaker, my question is for the Acting Prime Minister. Could he advise the House whether the government has determined the course of action it is prepared to take or will take to restore the movement of grain and shipping generally?


Mitchell William Sharp: Mr. Speaker, this and other related questions are under most active consideration but no decisions have been taken.


Mr. Speaker:: A supplementary question, the hon. member for Dartmouth-order, please, the hon. Minister of Industry, Trade and Commerce.


Alastair William Gillespie: Mr. Speaker, with your agreement I should like to complete the answer to a question put to me by the hon. member-


Some hon. Members:: No, no!


Some hon. Members:: Oh, oh!
Oral Questions


Joseph Jacques Jean Chrétien: They do not want an answer.


Mr. Speaker:: Perhaps the minister could wait about five minutes until the end of the question period.


J. Michael Forrestall: Mr. Speaker, my supplementary question arises partly out of the minister's response and partly out of what we consider to be the urgency and necessity of some information for the Canadian public. Would the minister undertake to advise this House-not today as we accept that negotiation and consideration is an ongoing matter-but on Friday on motions of the present situation with respect to mediation efforts in Vancouver and more particularly with respect to the general situation between the Treasury Board and the General Labour and Trades Groups?


Mitchell William Sharp: Mr. Speaker, I shall certainly advise my colleagues the Acting Minister of Labour and the President of the Treasury Board to be as forthcoming as possible. I hope my hon. friend recognizes that there are two dangers which we should try to avoid. One is to have negotiations in this House and the other is for the negotiations to proceed under the threat of parliamentary action.



FISHERIES


Walter C. Carter: Mr. Speaker, I have a question for the Minister of State responsible for Fisheries concerning a motion which I presented under Standing Order 43 about the position to be taken by this country at the forthcoming law of the Sea Conference. As the minister's colleagues refused to approve the motion, which refusal I consider to be a betrayal of the rights of our fishermen and evidence of this government's contempt for our fishermen, and as the motion is in effect the same motion which was debated and approved by the House in June, 1973-


Mr. Speaker:: Order, please. The hon. member for St. John's West has the floor for the purpose of asking a question. I wonder if he would ask his question.


Walter C. Carter: Mr. Speaker, as the motion dealt with the position which was being espoused by the minister and his colleagues outside the House and in committee, will the minister assure the House and fishermen of the country that the Canadian position has not changed and that the position we shall put forward at the forthcoming Law of the Sea Conference will be the same as that outlined by him and his colleagues on numerous occasions in the past couple of years.


Hon. Romeo LeBlanc (Minister of State (Fisheries)):: Mr. Speaker, I do not think the fishermen of the country need to be reassured after the excellent speech my colleague, the Secretary of State for External Affairs, made in Halifax a couple of weeks ago. But, if they need to be

March 12, 1975
Oral Questions
reassured, let me say that our delegation in going to Geneva with a firm mandate to negotiate hard on behalf of Canada.


Walter C. Carter: A supplementary question, Mr. Speaker. Will the minister or his colleague, the Secretary of State for External Affairs, outline on motions and put up on public record the position which this government will take at the Law of the Sea Conference which is to begin in Geneva on March 17.


Hon. Allan J. MacEachen (Secretary of State for External Affairs):: Mr. Speaker, I appeared before the Standing Committee on External Affairs and National Defence last night, and in my opening statement set out once again the position which Canada will take at the Law of the Sea Conference. As the deliberations proceed, I will be prepared to answer questions on the details of our presentation at the conference. I assure my hon. friend that the position which is well known as the Canadian position will be upheld at the conference.



INDUSTRY


Alastair William Gillespie: Mr. Speaker, I rise on a point of order. The hon. member for Northumberland-Durham asked me how much the subsidy payment is outstanding under our commitments under the subsidy program when he put his question on the relationship of subsidy payments and the dredging contracts. I have just been informed that payments totalling $1,190,000 with respect to Marine Industries Limited under the shipbuilding subsidy agreements are due.



MICROSYSTEMS INTERNATIONAL-AMOUNT OF CONDITIONAL AND UNCONDITIONAL GRANTS

Alastair William Gillespie: Mr. Speaker, while I am on my feet, may I clarify an answer I gave the member for Winnipeg North to do with grants to Microsystems International. I had indicated that $13 million, of the total of close to $30 million in grants was conditional, and $16 million was unconditional. On checking, I find that the grants totalling $30.4 million were all conditional grants.


Allan Frederick Lawrence: Mr. Speaker, I rise on the same point of order. I assume, since Your Honour allowed the minister to get up and partially answer a question on the basis of knowledge he must have had when the question was asked in the first place, that you will permit me to ask a supplementary question arising from that answer. My point of order is this: I wonder if the minister would be good enough, at the same time, to indicate to us the total amount owing under both the income tax charges and the fraud and conspiracy charges, as indicated in the indictments relating to Marine Industries Limited, and whether these actually cover the amounts he is now talking about.

If he cannot answer that, I wonder if the Solicitor General can.


Mr. Speaker:: Order, please. Orders of the day.



GOVERNMENT ORDERS


Donald Stovel Macdonald: that Bill C-8, to establish a national petroleum company, be read the second time and referred to the Standing Committee on National Resources and Public Works.
He said: Mr. Speaker, it is my pleasure today to rise and move that Bill C-8, to establish a national petroleum company, be read the second time and referred to the Standing Committee on National Resources and Public Works. This bill is a most important element in the government's long-term planning to secure adequate supplies of energy to meet our national needs. It is firmly rooted in the basic objectives of our energy and resource policies which are, to ensure for Canadians adequate and reliable supplies at reasonable prices, as well as a direct share in the wealth which development of our resources generates.
My emphasis on long-term planning is deliberate and necessary. We harbour no illusions that establishment of a national petroleum company is likely to lead to early and spectacular results in terms of massive energy development or financial success. I want the House to know that we are going into this venture in full realization of the fact that the hazards of exploration risk, technical and commercial uncertainty await this venture. We are nevertheless convinced that the national interests now require a significant degree of federal public enterprise in the oil and natural gas area. This enterprise will complement other federal efforts in the uranium and nuclear sectors, and reinforce provincial activities in electric power.
The vehicle we have chosen to carry out this function is a national petroleum company. Its organization, structure, objects, powers and duties are described in the bill and summarized in the Administrator's recommendation attached to it. The bill is neither lengthy nor complex, and detailed discussion of its provisions should be held for the committee stage. I do wish to spend some time, however, explaining to the House why this legislation has been brought forward.

Mr. Speaker, hon. members will recall that the energy policy review which I published nearly two years age included extensive description of the role of state participation in the energy industry in Canada and abroad together with a careful analysis of the benefits and drawbacks which might stem from the creation of a Canadiar national petroleum company. The advantages and disad vantages as represented in the review appeared to balance
March 12, 1975

out, and no conclusion was drawn one way or the other. I think that this fairly reflected the government's position at the time.
I need hardly remind the House how much things have changed since then. The physical limitations of commer-cially-accessible energy resources in southern Canada have become even clearer. The economic, technical and environmental problems of developing the energy resources in our geographical and technical frontiers-the north, the oil sands and the offshore-have if anything been magnified by the passage of time. The terms and channels of access to overseas oil and energy supplies to meet deficiencies in our domestic resources have sharply changed. Fresh uncertainties have arisen as to the physical security of those supplies in certain circumstances. And we have experienced, and still face, huge increases in the real cost of our energy supplies, whether from the domestic frontiers or from abroad.

Petro-Canada
trolled, will continue to play an important role in this area. However, we are looking to the company to increase the Canadian presence in a sector which is of critical importance to assuring future energy supplies. Where possible, the company would seek to operate jointly with both Canadian and foreign firms in development activity.
As the House knows, the federal government holds a 45 per cent interest in Panarctic Oils Ltd. For the past eight years this company has carried out an extensive exploration program in the Arctic Islands. The national petroleum company would co-ordinate government interests and objectives in relation to Panarctic's future activities.
There may be areas of exploration which are not undertaken by the private sector, either because commercial returns are not easily defined by the corporations involved or because they are deemed to be too far distant. There may also be areas of exploration which are not pursued by the private sector because of the financial burdens involved. These are cases where the company would carry out exploration activities of its own.

Mr. Speaker, this public enterprise will not be restricted to exploration for conventional hydrocarbons. Considerable technological advances remain to be achieved in the field of synthetic oil and gas production. Syncrude is a case in point. This important undertaking, which may become the first investment of our new petroleum company, is a large-scale step towards the commercial development of the oil sands.
The road ahead is a long and difficult one. The mining technology, which is more developed than the unproved in situ technique, can sustain access to more than 20 billion barrels of much needed reserves. The investment requirements are, however, very large-and probably beyond the capability of any single corporation or even group of companies operating in our country. Also, the largest private entities which may be potential participants in oil sands projects are necessarily the foreign controlled internationals. The best way to secure a Canadian presence a rate of development consistent with our national interest, a proper share of the income generated by such activity and full access to new technology, is by a direct government involvement in key ventures through a corporation which can develop the necessary expertise. Our national petroleum company would then be in a position to act as a catalyst for succeeding projects, assisting in their planning and financing as well as participating ultimately in their revenues.
About four-fifths of the immense resources of the oil sands can only be unlocked by successful development of in situ technology. It is clearly a matter of prime national interest to foster research in this area. Our national petroleum company should be the vehicle through which this federal participation in research is supported and monitored. It would thereby secure for the country the technology and access to patents needed for in situ commercial exploitation of the oil sands.

Exploration, development and associated research are but the first important steps toward commercial development of our frontier oil resources. To bring them to market will involve the construction and operation of transporta-

tion systems of unprecedented size, complexity and cost. To bring these facilities on-stream threatens to strain the financial resources of private industry and capital markets. An alternative to even heavier reliance on foreign investment to finance these projects would be participation in them by a national petroleum company. This would seem a natural extension to its efforts, by assuring that the energy resources it helped to find and develop are brought to the Canadian consumer without undue delay and at least cost.
However successful our domestic resource development is, over the next few years we are likely to remain dependent on foreign sources for petroleum supply to eastern Canada. The government has acted to reduce this dependence by promoting the construction of pipeline facilities to bring western Canadian oil to Montreal. It is also taking steps domestically, and in conjunction with other countries, to minimize the risks and consequences of overseas supply dislocation. And it has, of course, cushioned the eastern Canadian consumer from the effects of recent overseas oil price increases. The basic element of supply for eastern Canada, namely, the importation of foreign crude oil for refining here, nevertheless remains in the hands of private companies.
It is a striking fact that every one of the dozen countries from which we import significant quantities of crude oil has its own state oil company and is progressively increasing the role of that company in relation to international transactions. If circumstances continue to develop in this direction, it could be that it will be more advantageous for us to import some of our crude oil through a public enterprise rather than entirely by means of private companies. The national corporation will be ready to take part in petroleum importing activities if it is clearly in the national interest for it to do so. The obvious interest to be served is that of importing at lower cost than the private companies are able to.
It is conceivable as well that a national company might be able to enter into arrangements with a foreign state petroleum company which would offer greater assurance of supply continuity than could be provided by arrangements effected by private importers. In a general way the corporation might well be a most effective vehicle for the implementation of constructive political and trade relations with the oil exporting countries.
I would like now to turn to the matter of the domestic ownership of Canadian energy resources. Phase I of the energy policy studies revealed that the extent of foreign ownership or control of the petroleum industry is in excess of 90 per cent. One way in which Canadians can assert their presence in this heavily dominated sector of our economy is by having a nationally-owned company which could bring together smaller Canadian companies into a larger, more competitive entity through joint ventures and the forming of various consortia. I should emphasize here that the development of the north will require capital of a magnitude not normally available to most Canadian-owned companies. The national corporation can play a decisive role in the formation of joint ventures in an attempt to alleviate this problem. Such partnerships may offer viable alternatives to the small

Canadian operators who, in the past, have had to sell out to the internationals when they ran short of risk capital. [Translation]
Mr. Speaker, this leads me to a most important aspect of the operation of the company, that of staff and manpower training. People are a company's most important resource and the Canadian petroleum industry has developed over the years a highly competent group of professionals who have become experts in all phases of industry operations including its management. The majority of these are employed by foreign-owned companies. The corporation will offer opportunities which are commensurate in challenge and scope, and as its role may ultimately be just as diverse as those of some large international companies; it will provide a good training ground for Canadians wishing to link their careers with the oil industry in the service of Canada.
Much of the activities of the company will take place in frontier areas inhabited by our native peoples and I look to the company to play an important role in training Canadians of Inuit and Indian origin. It could in this way make an effective contribution to the social as well as the economic development of the north.
The bill before us provides powers for the company to engage in "downstream" activities of the petroleum industry such as oil refining and marketing. While the government intends thereby to keep our options open and enable us to respond to future needs and opportunities, it is our present view that this sector of the industry is well provided for by private companies. Moreover, the costs of entering this phase of the business are extremely high and might not immediately be justified in relation to the more pressing need for development of the basic resources. [English]
The House is aware that the economic growth and social progress of our country have taken place in an economic framework characterized by both public and private enterprise. Examples of successful public entrepreneurship in the fields of civil aviation, electric power generation, particularly in development of the CANDU nuclear reactor, the country's most successful energy project, railway transportation and petrochemicals are too numerous to mention here. Until recently our fuel industries have been characterized by almost complete private ownership. I want it to be clearly understood that the national petroleum company which we propose will not replace private industry or private entrepreneurship. We look to the private sector to continue to find, develop, transport and deliver the bulk of our fuel energy needs. The national petroleum company is intended to supplement and stimulate the efforts of the private sector in a co-operative atmosphere to the benefit of all Canadians.
Whether under public or private direction, a significant part of the Canadian economic activity is located in energy producing activities. The largest part of this production is vital to other Canadian industrial activities and to the support of the Canadian lifestyle. The climate of Canada and the standard of living to which we aspire, combine to make this sector of the economy one of the most important. The government has always recognized the special status of this industry. The creation of the national corporation will add to the instruments available
Petro-Canada
to the Government of Canada to advance Canadian interest in secure and adequate energy supplies and in the sharing of the wealth which Canadian resource endowments make possible.
I trust the House will give Bill C-8 the careful consideration and prompt passage which it deserves. I can promise that, upon its enactment, the government will move equally quickly to set up the company and put it to work. The establishment of a national petroleum company is not a venture for the short-sighted or for the timid.


Mr. Bawden:: What about the taxpayer?


Donald Stovel Macdonald: Speaking about being shortsighted, I think the best example is the hon. member for Calgary South (Mr. Bawden)-or is he the member for Houston? I really don't know.


Peter Colwell Bawden: Now your prejudices are coming out!


Donald Stovel Macdonald: That great Canadian, the member from Houston!


Peter Colwell Bawden: Where are you from?


Donald Stovel Macdonald: I would ask the House, by passing this legislation, to show its confidence in the reality of our energy potential, its recognition of the magnitude of our needs, and its belief that the time is ripe for a bold step which will give public enterprise a significant role in this critically important industry.


Some hon. Members:: Hear, hear!


Mr. James Gillies (Don Valley):: Mr. Speaker, I do agree with one thing the Minister of Energy, Mines and Resources (Mr. Macdonald) has said-this is an important debate, for the government's proposal marks a milestone in the development of the Canadian economy; it indicates the direction the government wants the country to take in the future, and suggests the kind of society it wants to create.
We have a proposal today made by the federal government that it move further into the private sector, without there being any demonstration that there is a need for it to do so. The bill is so broad that it is clear the government is taking the position that the private sector can no longer be counted upon to develop natural resources in this country. However, most of the Canadian people believe we should have an economy that basically is operated through the initiative of its citizens, not its governments.
We in Canada have evolved over time a modern, contemporary view of economy policy. No one today objects to the proposition that it is the government's responsibility to provide a level of full employment, to keep prices stable, to do something about regional disparities and to lessen disparity of income among individuals in different parts of the nation. We all believe that this is an essential part of government's responsibilities.
Associated with that, however, is the proposition that the best way to do this is through general monetary and fiscal policy, and the application of regulations where

March 12, 1975
Petro-Canada
there are natural monopolies in the system. The best way to assure a high standard of living is not for the government to move directly into the production and distribution of goods and services. The evidence is all too clear that in those areas where the government moves in directly the efficiency of operation is something less than maximum. One need do no more than to point to the post office and all its difficulties to illustrate this point; but evidence from around the world also demonstrates that those countries with the highest standard of living are basically those that depend upon the private sector to produce and distribute resources.
The government is bringing in a bill dealing with a major area affecting the future of this country, a bill proposing measures that are bound to replace the private sector to a considerable degree. The government clearly demonstrates by this legislation that it no longer has confidence that the private sector can operate effectively in this country.
What we should have in these days of runaway inflation is efficiency and effectiveness in the use of our resources, yet we have staggering statistics coming forward showing that in area after area, and particularly in the government sector, there is no increase in productivity at all. Yet the government wants to move even further into the economy than it has gone in the past. Surely if ever there was a time when we should pause and reflect upon expanding government activities, it is now.
What will the proposed company do? It will explore, develop and exploit our hydrocarbon deposits both within and without the country. It is interesting to note that the company will operate outside as well as within the country. It will carry out research and development, engage in the marketing of fuels, and will negotiate and acquire petroleum products necessary to maintain Canadian supplies from abroad.
Why does the government think that a new corporation to implement these measures is necessary? First of all on the question of exploration, presumably the creation of this company is an indication that the government believes there is inadequate exploration by the oil industry today. I say that the majority of informed people involved in natural resource development in Canada would agree with that. But they would point out that the reason there has been a decline in exploration activity in this country is precisely because the government has interfered. The government has evolved policies that make it impossible for the private sector to operate and explore in the way it has in the past. The oil and petroleum industry has never lived with such uncertainty as it has experienced the past two or three years. We have had a hodge-podge of tax legislation and confrontation making it impossible for the oil industry to operate in the normal way.
Most important, Mr. Speaker, the government has formulated no rules or regulations regarding exploration for oil in the vast northern areas of the country that still need to be explored. There is something very peculiar and paradoxical, about the fact that at a time when we are concerned about supply, about exploration and getting more oil on-stream, there is a whole series of activities on

the part of the government that make it impossible for exploration to go ahead.
To suggest, for even one moment, that by the creation of another government entity we will automatically get more oil is a false assumption. If the government is really concerned about security of oil supply for this country, what it should do-something it could do immediately-is lay down regulations for exploration in the northern territories and set a tax structure that will enable the industry to go ahead and explore.
The problem the industry in this nation has been facing as we have moved from exploration to development is that it has not known just what the government is asking from it. Whenever the government has passed a series of laws or set a tax structure, we have witnessed a positive and effective response from the private sector. But once the government begins to change the tax laws and introduces uncertainty, this response falters.
One really wonders just what is in the back of the government's mind. It enacted a series of proposals that made it impossible for the industry to operate effectively, and now it wants to create a government company to take the place of private industry. Surely the thing to do before taking such a step is to work out a set of regulations and laws making it possible for the industry to operate, and then we will have a reasonable test and time to determine whether or not there is any need for some sort of direct government intervention of the kind proposed in the legislation before us today.
Additional clauses of the bill call for the distribution and refining of fuels. Does anyone really believe that we in the parliament of Canada need legislation today allowing the federal government to get into the business of refining? Does anyone really believe there is a need for the establishment of a corporation to distribute refined gas in this country? So far as refined products are concerned, a visit to any city, town, village or crossroads will indicate that the last thing that the government needs to invest money in at this time, if ever, is the establishment of a distribution system for petroleum products. Obviously the distribution system that we have is operating effectively; the government does not need to take the taxpayers' money to become involved in this kind of operation.
In addition, the bill calls for powers to negotiate and acquire petroleum products from abroad. Again I ask, do we need a new company, paid for by the taxpayers, to do this sort of thing? As some of my colleagues have suggested during the course of the speech of the minister, this is something that could be done by the Department of Supply and Services. This should give us cause to pause, because the one time that the Department of Supply and Services went to the market to acquire oil it acquired it at probably the highest price paid for oil at any time, certainly in the history of Canada.
It is very difficult to find any need for the establishment of such a corporation as is proposed. I am sure we all applaud the development by the government of agencies, institutions and other bodies that help solve the problems facing the country. But there is nothing that suggests that we need this particular corporation to do things the Canadian people want done. It will not produce one extra barrel of oil for Canada.
March 12, 1975

Surely we do not need to have the government enter the refining business. It is obvious we do not need the government in the distribution business. No legislation is required to enable us to deal with other foreign countries; existing departments can carry out this function. So why introduce the legislation at all? Why spend the taxpayers' money on the establishment of such a company, particularly at a time when we should be very much concerned about expanding the economy, and about the inflationary impact of increasing government intervention? Why should we go ahead and pass the legislation proposed by the minister today?
Indeed, if you look at other aspects of the legislation such as those in clause 7(1)(d)<c) and (e) you will see that this company will have almost unlimited power in respect to acquiring and lending money to other companies. This legislation will give power to the government to do anything it wants in so far as the petroleum industry is concerned. I think it is wrong in principle to pass legislation that gives this sort of unlimited power to any government. It may be all very well for the minister and his colleagues to say they do not intend to get into the distribution business or to acquire other companies, and so on and so forth, but the fact is that in this legislation we are giving the power to the government which will allow it, if it so desires, to move in and literally take over the entire petroleum industry in Canada.
The minister has made it clear he is counting on the private sector to be the chief element in the development of resources and for providing for the oil needs of this country in the future. If that is the case why does he need legislation of this sort? If he is going to count on the private sector he does not need clause 7 in order to do some of the things he thinks are essential. Many countries got into trouble by passing legislation allowing for blanket operations on the part of government, when the government itself did not specify why it needed that sort of legislation. We are very opposed to that sort of broad right being given to the government at this particular time. We do not believe it is appropriate that the government be given the power under this legislation to take over the entire petroleum development industry in this country, if it wants to do so. It seems to me far from clear why this legislation is needed.
We cannot see that any of the proposals which have been put forward in the bill will really answer the energy problems facing this country. We do not really believe that the government will have much impact on total pricing in the country through the development of a $500 million corporation, or that it will have much influence on the industry as a whole. When you realize that Imperial Oil has revenue of $2.6 billion, and Exxon with much greater sales, it is clear that a $500 million company will not have much effect.
The argument is made that the government needs this legislation in order that it may have a marginal effect on pricing by the OPEC countries, but it seems to me that this sort of influence will be quite ineffective. I doubt very much whether a government controlled company will have any more opportunity to buy oil cheaper from OPEC countries, or other suppliers, than the people who are
Petro-Canada
buying that oil now. Certainly if it happens that the selling countries will not deal with anything except a government agency, we have the opportunity through various departments of the government to meet that particular requirement. As has been often suggested, we do not need a national petroleum company simply to buy oil from suppliers, and to suggest that this would allow us to buy oil cheaper I think is stretching our credibility a long way.
In addition, the minister says it is important to have federal government presence in the energy field. I suggest we already have a presence in that field through Panarctic. I think the government's case is far from made in this respect, because if it feels it should expand its position in this area why cannot it do so through Panarctic? Panarctic has the power to explore in the Arctic, and certainly if there is a need for further expansion of government into the private sector in this area then why not stay with Panarctic? Why is it necessary to start up a totally new corporation? It is this type of duplication that causes the government to grow so rapidly.
It is absolutely wrong for the government to suggest that Canadians cannot be protected in respect to their resources unless we have a national petroleum company. Canadians are protected now through the leasing and ownership arrangements that prevail in respect of all or much of the land where exploration is taking place.
Having regard to the minister's observation about foreign Control of the petroleum industry, one is well aware of this, but surely the suggestion is not seriously made that by establishing a national oil company to the tune of $500 million we are making an adequate response to this situation. This does nothing about the total question of control. If the government is serious about the proposition that there is too much control of the petroleum industry in Canada in foreign hands, surely the answer is to change the tax laws to make it more attractive to Canadians to invest in the industry, and more attractive for the companies which own the shares to divest them to Canadians.
The suggestion that because we are going to have a $500 million oil company and a greater national presence in the petroleum industry, this will really solve the problems, seems to me to be rather ludicrous. The argument that we should establish a national oil company in order to get better information about the petroleum industries can only be an indication of the failure on the part of the government to utilize its existing powers. It is suggested that the government cannot get the information it needs, or that the National Energy Board does not have the information. Surely the Department of Energy, Mines and Resources and the National Energy Board can get the information required to make appropriate decisions in respect of the development of our resources and the petroleum industry in general, if they are determined to do so.
Finally, it seems to me that during a period when there is a scarcity of resources, a tight market in respect of labour and a scarcity of trained geologists and other people needed to expand the petroleum industry, this is not the time for the federal government to compete with private industry for those resources, and I am sure the minister knows well the situation in the western prov-

Petro-Canada
inces. To do so will only make what is a serious situation even more serious.
People have wondered when this proposed company would get under way. The best estimate is that it will be five or ten years, perhaps even longer, before it will have any impact. There is no indication by the minister that the company will produce one extra barrel of oil for the Canadian people. The only thing we know is that it will use more of the taxpayers' money, and will mean an even greater expansion of government into the private sector.
There is every indication that the establishment of this company will cost the taxpayers a lot more money through the expansion of government, at a time of chaotic conditions in the industry, most of which have been created by the government itself. It is impossible to assess really what will be fulfilled by the corporation proposed by the minister. We feel very strongly on this side of the House that there is no need for this institution. We believe that the things the minister thinks have to be done, such as the management of Syncrude, exploration, and other things of that sort, are being appropriately handled without this legislation by the private sector, which is the vehicle in force today, and to that extent it should be allowed to continue. We believe that by granting the broad powers that are proposed for a corporation of this sort we are embarking on a totally new approach in this country to the development of energy and resources, an approach that will not lead to more efficient use or to the quicker development of our resources, and an approach that will not benefit the Canadian people in general. That is the reason why we are going to oppose, as strenuously as we can, the establishment of this corporation and the passage of this bill.


Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, Bill C-8 proposes to set up a Crown corporation which will be known as Petro-Canada. It gives wide ind sweeping powers to the proposed Crown corporation, operating under a board of directors responsible to a designated minister and subject to the approval of the governor in council.
Clause 3 of the bill sets forth the purpose of the corporation, and that purpose is sufficiently wide to cover any activity in the field of exploration, development, refining or marketing of petroleum products. Let me put on the record Clause 3 of the bill which sets forth the purpose of the legislation. It reads:
The purpose of this act is to establish within the energy industries in Canada a Crown owned company with authority to explore for hydrocarbon deposits, to negotiate for and acquire petroleum products from abroad to assure a continuity of supply for the needs of Canada, to develop and exploit deposits of hydrocarbons within and without Canada in the interests of Canada, to carry out research and development projects in relation to hydrocarbons and other fuels, and to engage in exploration for, and the production, distribution, refining and marketing of, fuels.
In clauses 6 and 7 the powers of the corporation are set forth, and I notice that the hon. member for Don Valley (Mr. Gillies) was expressing some horror about the sweeping nature of these powers. I want to say that so far as the members of this party are concerned, we think that the powers set forth in clauses 6 and 7 are absolutely neces-

sary if Petro-Canada is to play an effective role in an economic area which has too long been occupied and dominated by the multi-national giants.
The powers conferred on the corporation are wide powers and I think they would gladden the heart of any advocate of public ownership, but even if these powers are used, and even if Petro-Canada becomes a very powerful force in the oil industry of this country, it will still be a pigmy compared with the members of the world's oil cartel.
Petro-Canada, under this legislation, will have 100 common shares at a par value of $5 million each, to be held by the Government of Canada. The corporation will have authority to borrow up to $1 billion, subject to cabinet approval. It will have authority to set up subsidiaries to carry out economic activities provided they are related to the objectives for which Petro-Canada is being established by parliament.
I want to make it perfectly clear that we in the NDP not only do not object but we welcome the wide powers and the financial investments which are authorized by the passage of this legislation. It should be remembered that the people of Canada have paid billions of dollars to enlarge and enrich foreign oil companies, and only now, belatedly, are we setting up an economic vehicle to develop our petroleum resources for the benefit of Canadians.
There are some changes that we hope might be made when the bill is before the Standing Committee on National Resources and Public Works, and I will not take time to elaborate on them here except to say that one of the matters which I think should be considered by the committee and the House is a defect which we think represents a lack of adequate parliamentary control over the financial operations of the proposed corporation. I think the legislation should at least require that the annual report of this corporation and the appropriation for it should be reviewed each year by a standing committee, and that the report of that committee should be dealt with in the House before the House recesses.
Personally I am appalled at the extent to which Crown corporations and government agencies operate with only a token control by parliament. We do not think for a moment that parliament can interfere on a daily basis with the operation of a Crown corporation, but neither do we think that parliament should be asked to launch a corporation that is not responsible to the people through their elected representatives. After all, it is the people who pay the shot and it is supposedly for their benefit that the corporation is being established.
I want to turn now to ask the House to give some thought to the question of the role of Petro-Canada. As I have said, we welcome the legislation and we agree with the powers and the financial capacity which this legislation will give to Petro-Canada. But this measure can mean a great deal, or it can mean nothing at all.
The words in the bill are very inspiring, but until we hear the music we will not know whether or not we have a song on our hands. I have seen many bills passed with great fanfare, only to turn out to be a terrible disappointment. After all, it is the results that will count and not the

words in the bill or the rhetoric in the speech which the minister made today. I must say, on the basis of past performance in some of the ventures that the government has made into the field of public ownership, that I am not very optimistic.
This House must recognize that passing this bill will mean nothing at all unless Petro-Canada is given a real role in the oil industry of this country. This Crown corporation is an economic tool, and nothing more. It can be used effectively, or it can lie idle and hardly be used at all.
What is the role that the corporation is to play in the oil industry? It has the powers, as set out in the legislation, to assert the Canadian people's sovereignty and to grant them the right to enjoy the benefits of their natural legacy. But will these powers be used effectively and, if so, how will they be used? In the final analysis we cannot determine the role of Petro-Canada until the government has decided upon a clear and definitive national oil policy.
What is the thrust of the government's program for developing oil resources? Will we continue to leave control in the hands of the multinational corporations? Considering the Syncrude arrangement, I gather that we will. Are the Canadian people in the future to have oil prices determined by the OPEC countries which set the international price? Judging by the agreement with Syncrude that would seem to be the case because the government is assuring the companies in Syncrude that they will get the international price. The international price on which they base their financial estimated returns is $13.45 a barrel in 1978, $15 a barrel in 1984, and running up to $35 a barrel at the end of the project. What makes me skeptical is that my experience over a number of years shows that the Liberal party has never had the courage to grasp the nettle and face up to its responsibility for public intervention in the economy.


James McPhail Gillies: They have done too much.


Thomas Clement (Tommy) Douglas: The
Liberal party has always tried to be on both sides, so that we end up with two railroads, two airlines, and two broadcasting systems. When we go into oil development we take 45 per cent of Panarctic and 50 per cent of Syncrude.
If the hon. member for Don Valley (Mr. Gillies) will wait, I will refer in a few minutes to one kind of oil company which will really be doing something and not merely going through the motions. My fear is that if the government follows in the future the policies it has in the past, Petro-Canada will be nothing more than a sophisticated method of subsidizing the oil industry by joint-ventures, by taking over projects the private sector does not want to take over, and by drilling in areas the private sector thinks are too risky or too difficult. Petro-Canada will be nothing more than a means of subsidy. This, of course, has already been done with the Syncrude agreement, and in the agreement the government will be entering into with Interprovincial Pipeline.
What is Petro-Canada going to do? The minister's words were-I cannot quote him accurately, but he can correct me if I am wrong-that the work will be mainly exploratory work in areas which are too distant for the private
Petro-Canada
sector. Will the role of Petro-Canada be to drill in the Arctic, up in the Beaufort Sea, and out in the icebound areas of Canada where no one else wants to go? The major promising geological formations have already been leased, both in the Arctic and in the southern part of Canada, by the major oil companies, so what is Petro-Canada going to do? Will it simply be a bird dog for the private sector? Will it go out looking for oil in unpromising, costly and discouraging areas, and if it finds something then turn it over to the private sector?


An hon. Member:: It will be a haven for old Liberal
politicians.


Stanley Howard Knowles: They will all be in jail.


Thomas Clement (Tommy) Douglas: The
hon. member for Don Valley when he spoke suggested that if the government really wants to get into the oil business it could take a larger share of Panarctic instead of the 45 per cent it has now. That is part of the same mental attitude, that if the government is going to get into the oil business, then for God's sake it should go to some part of Canada where it is less likely to get oil, where it will be more costly to get oil, where less profit will be made, and the profitable areas should be left to the private sector which has already milked those areas and the people of Canada to the very limit.
What will be the role of Petro-Canada? Does the government really mean to use this economic tool, which is a good tool? If so, I congratulate the minister and those responsible for drafting it. What is the government going to do with Petro-Canada? Will it be an effective means of assuring the Canadian people a surety of supply of oil at reasonable prices? Or is it simply a charade to soothe the public indignation which is felt all across this country against the major oil corporations that have been gypping the public for decades?
If the government is really serious about setting up this Crown corporation, the minister should tell us and define clearly for us what its role will be, and outline for us the scenario within which it will perform some useful function.
I suggest to the House, and to the Minister of Energy, Mines and Resources (Mr. Macdonald), that Petro-Canada can be a very useful economic instrument. It can be used to break the economic stranglehold of the foreign oil cartel which, as the minister said this afternoon, controls over 90 per cent of our oil production, and some 99 per cent of our oil refining. This international oligarchy has squandered our Canadian resources, fleeced the Canadian public, and now it stands ready to hold the government and the people of Canada to ransom to compel us to accept its terms in order to get the economic development we need to meet our oil and gas needs.
I respect the hon. member for Don Valley as a member of parliament, and I respect his right to have his own views. He said-and he can correct me if I am not quoting him accurately-that this bill represents a lack of confidence in the private sector. I agree with that statement. I think most Canadians have lost confidence in the private

Petro-Canada
sector with regard to the oil and gas industry in this country.
The poll taken last year proved conclusively that the bulk of the Canadian people feel that the foreign controlled multinational corporations have fleeced them. They have shipped 50 per cent to 60 per cent of our oil and gas out of the country at low prices. They have brought us to the point where today we face dwindling resources and the possibility of being unable to meet our needs, and they have now put the gun to our heads and said that we must come across on their terms or they will not help us out of the mess in which we find ourselves. If Petro-Canada is going to have an effective role in meeting this situation, this will not be done by giving it some peripheral role up in the Arctic, or in a joint venture in which it has 10 per cent or 15 per cent or 25 per cent equity.
There are at least two things which Petro-Canada must do if it is not going to be merely a farce and a charade. First of all Petro-Canada should take over one of the major oil companies and operate it. That is the only way it is going to get into the promising oil bearing formations. It is the only way it is going to get refining facilities. The company which would be most logical is Imperial Oil, which has had generous leases given to it in the Arctic and the southern part of Canada by this and other governments. It has the refineries, and it controls interprovincial pipelines which could transport the oil.
If the government is really serious it should get Petro-Canada to take over one of the major oil companies and give the oil industry some competition. It could guarantee to the Canadian people that there would be oil produced and distributed in this country on the basis of the wellbeing of Canada, and not on the basis of making profits for Exxon or any of the large multinational giants.
Instead of taking over a large company the government keeps on subsidizing. We subsidize Imperial, Gulf and Cities Service by tax concessions and guaranteeing them an international oil price, and by putting up part of the equity capital. We subsidize the Interprovincial Oil Pipe-lihe Company by guaranteeing it against loss if it builds a pipeline from Sarnia to Montreal.
The country is getting a little fed up with these entrepreneurs who read us lectures about "standing on your own feet", "no government intervention", "no government subsidies", "welfare bums", and "unemployment rip-off" in the unemployment insurance plan, but the moment there is an election in the offing they are the first people to the trough wanting subsidies, tax concessions, protective tariffs, quotas-


James McPhail Gillies: They should not get it.


Thomas Clement (Tommy) Douglas: But
they do get it, and have got it from successive governments, decade after decade. If the private enterprise sector of the economy is anxious to develop the oil and gas resources of this country, then the people in it should not be asking for the concessions they get. If they are not prepared to do it they should get out of the way and let the people of Canada do it for themselves. That is why I say that if Petro-Canada is going to have any effect at all, if it 
is going to change the picture in Canada with respect to the discovery, development, refining and distribution of oil and natural gas, it has got to nationalize one of the major companies.
After listening to the hon. member for Saint-Hyacinthe (Mr. Wagner) asking the government to nationalize the dredging industry in Canada I can say that maybe the Conservative Party would not think it is such a terrible thing to talk about nationalizing the oil industry.
The second thing which I think Petro-Canada must do, if it is going to be of value to the Canadian people, is become the sole importer of oil in this country. There is no reason at all why it cannot be the sole purchaser of oil. It would, of course, have to distribute it through the channels which at the present time are in the hands of private companies, but the oil should be imported through a Crown corporation.
The tragedy is when the government, in the interests of the people of Canada, tries to help the people and calls upon the private sector to co-operate in doing so, and the private sector rips them off. There is a very good example of that in this morning's newspaper, and it has been apparent to many of us for weeks. Ever since the government initiated the compensation payments program the major oil companies have been shifting their purchases from Venezuela, which was one of the best sources of supply over to Middle Eastern countries. They can get $1.30 more per barrel by taking oil from the Middle East rather than Venezuela.


An hon. Member:: Another example of government
incompetence.


Thomas Clement (Tommy) Douglas: It is
another example of the greed of the oil industry.


Mr. Clarke (Vancouver Quadra):: It is commonsense.


Thomas Clement (Tommy) Douglas: To rip
off the Treasury of Canada to the tune of $1.30 a barrel on millions of barrels of oil is commonsense? If that is commonsense, then God help us.


Stanley Howard Knowles: It is not
"cents"-it is dollars.


Thomas Clement (Tommy) Douglas: That is a deplorable attitude. For the oil industry which has had the benefit of these compensation payments to use the loophole of switching its purchases from Venezuela, which has been a good supplier and co-operated with us all through the embargo, over to the Middle Eastern countries for the sake of $1.30 a barrel, is deplorable. We import
800,000	or 900,000 barrels per day, and some 60 per cent of it comes from the Middle East. In my opinion this is reprehensible.
It is interesting that according to this morning's Globe and Mail officials of the Department of Energy, Mines and Resources admitted:
... that the facts as provided by the Energy Supplies Allocations Board, which runs the compensation program, do seem to suggest that not only have some oil companies discovered a profitable loophole in the program, but that they seem increasingly to be taking advantage of
it.

The minister has the tool at his hand when we pass this bill. The compensation payments program was designed to see that those who live east of the Ottawa Valley get crude oil at a price uniform with the rest of Canada, and it was a good program. But if the companies are going to take advantage of it to rip off the federal Treasury then the time has come for the minister to say that oil will now be imported not by the private sector of the oil industry but through Petro-Canada.
As the minister said this afternoon, nearly all the oil-producing countries have nationalized their oil industries ... in the Middle East and in Africa. I notice that the Prime Minister of Venezuela has notified his parliament that legislation will be introduced within a week or two to nationalize the oil industry in that country. In most of these countries, particularly Iran, Venezuela and Saudi Arabia, they have said publicly that they would prefer to deal on a state to state trading basis. Actually, the Shah of Iran went so far as to say a short time ago that he was prepared to reduce the price of crude oil sold by Iran, on a state to state basis. He will not do this for multinational oil companies because he knows they will stick the difference in their pockets and not pass it on to consumers. But he said he was prepared to reduce the price of oil sold to state trading corporations. Brazil has set up a state trading corporation which is to purchase oil and enter into country to country trading agreements. There is no reason why Canada cannot do it too.
The minister now has the opportunity to establish the Petro-Canada Crown corporation as an oil marketing agency which will handle imported oil, so that we could on the one hand make sure that the compensation payments we are presently making are not part of a rip-off and, on the other hand, make the best possible deals with oil producing countries which are prepared to sell oil on a government to government basis.
Let me close by saying that the situation in this country is far too serious for us to be satisfied with timid measures which are neither fish, fowl nor good red herring. This country faces an energy crisis which, over the next ten or 15 years, can be extremely serious for the people of Canada. I think the crisis can be met successfully, although not easily. But we will not meet it with a Crown corporation which will be stuck up in the Arctic or used merely as a showpiece, to indicate that the government is making the proper genuflections in the direction of public ownership.
If we are to meet this crisis, there must be fundamental changes in the oil industry in Canada. The oil industry in Canada must be restructured. That can only be done if the government is prepared to act boldly, if it is prepared to break the oil cartel which has bled this country almost white, and if it is prepared to step in courageously and follow the trend which is becoming apparent all over the world, the trend which is making the production and distribution of fossil fuels the concern of a public utility.


Gérard Laprise: Mr. Speaker, some time ago, I was looking through Bill C-8 and I saw that the government wanted to set up a corporation at a cost of
Petro-Canada
$500 millions. I looked into my pocket to check whether I could buy a few shares of that corporation, but when I read a little further the recommendations of His Excellency the Administrator of Canada, I saw that the shares were $5 millions each. I quickly withdrew my hand out of my pocket and I read further again in the bill to discover what benefits Canada would gain from the establishment of that corporation, which would be called Petro-Canada.
Mr. Speaker, after hearing the previous speakers, members will have understood that this House has before it a bill introduced by the hon. minister of Energy, Mines and Resources (Mr. Macdonald). Their speeches have a strong smell of socialist government.
I was surprised to see the reluctance of the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas) towards this bill. It seems that in his opinion, this bill is not quite totalitarian enough.
Mr. Speaker, the thinking underlying this bill is illustrated by the way all the clauses are printed: they are on the left page and this bill is also a leftist bill.
This bill also provides for the potential transfer of the shares of Panarctic Oils limited. The purpose of this bill is to control every oil-related aspect in Canada: research, exploration, production, import and distribution in Canada.
Mr. Speaker, it is like giving a blank cheque to a corporation of 15 people who will control this energy source which, even if it is depleting, is still important for some years to come.
In this bill, I have been surprised that I did not find, as would have been the case if the government had wanted to be sincere, other energy sources the Corporation could research on. It is as if oil were the only energy source which could be found in Canada's underground. We are aware of the fact, Mr. Speaker, that we have already succeeded in developing nuclear energy sources in Canada. We have not done much in the area of solar energy but we know that in the nineteenth century already, fairly conclusive research has been carried out in Europe. This developement was not continued, and I do not know why. But now that the main source of energy in the world is drying up I think we must look elsewhere.
We were given a report at the time of the famous oil crisis in the autumn of 1973. Newspapers carried out research and determined that at that time, in 1972, known conventional oil reserves in Canada were about eight billion barrels. Considering the projected increase in consumption, Canada's need could be met for 11 and a half years.
Indeed, Mr. Speaker, a recent report showed the accuracy of the previous one. We are also told that non-conventional reserves, that is tar sands, were estimated at between 300 and 770 billion barrels but that it would cost between $20 billion and $30 billion to develop those reserves. That is how things stand.
Mr. Speaker, known oil reserves are not limited only to Canada, and are not depleting only in Canada.
In 1972, known reserves in the United States were good for about ten years which represents world reserves of 5

Petro-Canada
per cent. Venezuela was good for only 11 years. Indonesia had enough left for only 13 years. It is in Algeria that known reserves are the largest. World reserve is 7 per cent, and world production only 2 per cent, while Algeria's reserves in 1972 was good for 120 years. As to Koweit and Lybia their reserves were good for 35 years. For the USSR it is 26 years, 54 years for Saudi Arabia, and 66 years for Iraq. Altogether, known world reserves were 664.5 billion barrels based on production in 1974. That reserve would last only 36 years.
Mr. Speaker, I wonder whether the proposed investment is really justifiable. Will the exploration required from that corporation go over the same ground where private corporations carried out theirs? If those private companies found nothing, what is the point in returning to look in the same places?
If companies such as Imperial Oil Limited, Texaco Canada Limited, Shell Canada Limited, BP Oil Limited or others have found considerable reserves and have not revealed their content because they are keeping them for later, I think it is the responsibility of the government to find a way to compel them to divulge the results of their research.
That corporation will be composed of 15 members. I suppose, Mr. Speaker, that the Minister of Energy, Mines and Resources (Mr. Macdonald) will not have to write every Liberal member to get suggestions from good Liberals as to who should be appointed head of that corporation.
I suppose he has already thought of some people to manage that new corporation. Yet, Mr. Speaker, in view of the experience of other Crown corporations, we may be allowed to entertain some doubts. Managing a public corporation and managing a private one is quite different. In a private corporation, be it of a large, average or small size, one is accountable to someone; private investments are managed and must be managed wisely so as to grow or one's job is at stake. It is not the same in a public undertaking like a Crown corporation. Even if one is steering a wrong course, even if questionable experiments are made bringing no return, there are no penalties. It is public funds which are spent.
Now, Mr. Speaker, we have seen the same thing happening in other Crown corporations and this is the reason why I entertain some doubts about the outcome of this one. I cannot therefore support the government in the establishment of such a corporation. I have doubts about the results in the first place. Private companies looked after oil exploration and development, they provided Canada with reserves. I believe they did their best. They may have gone too far, because they are not exempt from wrongdoings. But that is something for the government to regulate.
For the benefit of Canadians, Mr. Speaker, if new discoveries are aimed at, we have had experience, in the province of Quebec with a Crown corporation named SOQUIP. It is affiliated with private companies. Until now the results are not so great. Nothing much has been accomplished, although it has been in existence for some years. I believe a federal corporation will not live up to expectations, other than giving jobs to a select group of public servants, and spending the taxpayer's money. The $500 million will have to be borrowed, because we always
[Mr. Laprise.l
have a deficit budget. Therefore, money will have to be borrowed to accomplish what has not been done by private enterprise.
At the committee stage, where the details of the bill will be scrutinized, we will have the privilege of questioning people with expertise in this field. We will have an opportunity to obtain more information on every aspect of the bill. We will then be in a position to have a clearer picture of results that may be expected from this kind of corporation.
Therefore, I am not ready at this stage to support the bill. I would however approve its referral to committee, but I have serious doubts that the aims can be achieved. In a democratic type of society such as we enjoy in Canada, I find it amazing that we are constantly endeavoring to administer the socialist way.


Mr. Jim Balfour (Regina East):: Mr. Speaker, I welcome the opportunity to enter into the debate on the merits, or otherwise, of passing an abling legislation to permit the federal government to create yet another bureaucratic monster, for which the long-suffering Canadian taxpayer will pick up the tab, in the form of a national petroleum corporation, otherwise to be known as Petro-Canada.
It is quite clear and obvious from a perusal of clause 3 that the purpose of the bill is to establish a Crown owned petroleum company within the petroleum industry of Canada. Under the act, Petro-Canada, as the company is referred to in the bill, will be given the authority to explore, develop and exploit hydrocarbon deposits within and without Canada, carry out research and development projects related to hydrocarbons and other fuels, engage in distribution, production and refining and marketing of fuels and, finally, negotiate for and acquire petroleum products necessary to maintain Canadian supplies from abroad-in short, Mr. Speaker, a fully integrated petroleum corporation.
Its authorized capital is to be $500 million, and the legislation bestows upon the corporation those ancillary powers normally associated with commercial entities operating in the private sector, including wide borrowing powers.
In addition, by clause 22 of the statute, Petro-Canada is given what amounts to a blank cheque in the form of virtually unlimited ability to receive advances out of the consolidated revenue fund of Canada, either by way of loan, or by way of purchase by the consolidated revenue fund of preferred redeemable shares of the company, and the authorized capital of the corporation shall be automatically deemed to be increased by the amount of any preferred shares issued pursuant to such an arrangement.
Before undertaking a more detailed cost-benefit analysis of the bill before us, may I make the general observation that I consider it an unfortunate practice by government to frame legislation in terms far wider than are required to achieve a stated policy object, whether on the grounds of future convenience or otherwise.
A drafting approach appropriate to the private sector, when one normally drafts object powers for incorporation purposes in as broad terms as possible, is not, I suggest,

appropriate to public business, particularly where to do so in this case might have the effect of inducing this House to forbear from in-depth consideration of all possible implications of what is before it through reliance on statements by the minister that, notwithstanding the form of the statute, the intention is not to engage in certain activities but rather to limit the Crown company to the business of tar sand development, frontier exploration, off-shore purchases, and research and development into alternative energy supplies.
The purpose and authority of the proposed company should be specified and frankly disclosed on the principle that if in the future it should be considered desirable as a matter of public policy to widen the scope of the proposed company's undertaking, the minister could then return to parliament with fresh legislative proposals and advance these on their own merits in the light of conditions and circumstances that may at that point in time apply.
Unlike some of my colleagues, whose views I nevertheless respect, I have no particular prejudice against government involvement in commercial activity when logic and circumstance indicate such involvement to be appropriate and in the public interest. Power utilities, telephone utilities, the Bank of Canada, the Canadian Broadcasting Corporation, Central Mortgage and Housing Corporation-all these are examples of such activity by provincial and federal governments.
However, I do suggest there should be criteria by which the need for and desirability of such government activity and involvement are judged, and such criteria would surely include the following test-has the private sector failed to meet a demonstrable social or economic need in connection with the commercial activity which the government proposes to enter? In the case of the domestic petroleum industry I submit to the minister that he has totally failed to meet this fundamental test.
On the contrary, in the 20-odd years since the Leduc and the Redwater discoveries in Alberta the domestic petroleum industry has developed from a relatively insignificant state into what could be characterized as a mature, aggressive, innovative and confident industry, willing and capable of undertaking the high-risk, difficult task of providing for Canada and Canadians self-sufficiency in petroleum and natural gas supplies for the decades ahead and, incidentally, employing directly hundreds of thousands of Canadians in both western and eastern Canada. That, at any rate, was the situation a little more than one year ago.
There are those, Mr. Speaker, who favour state ownership and control for its own sake and who would welcome creation of a national petroleum corporation regardless of considerations of cost and practicality. There are others who view state ownership of commercial entities as unacceptable per se and reject such a concept regardless of any benefits which might be forthcoming. For most Canadians, however, government involvement in the private sector is neither panacea nor Pandora's box. Most Canadians, I suspect, would wish to have each case examined on its merits. For this majority the judgment for or against the merits of establishing a national petroleum corporation
Petro-Canada
will depend on the particular benefits that such an institution can offer, weighed against the costs which would inevitably accompany such a huge undertaking.
In considering this question it is important to bear in mind that longstanding, in-depth government involvement and participation in Canada's energy industry is a scarcely questioned fact of life. Control of the oil and gas sectors, the sectors most relevant to our discussion, is exercised by both federal and provincial authorities.
Conservation boards in Alberta, Saskatchewan and British Columbia control the levels of production of oil and gas in their respective provinces and pro-ration such production among the various producing companies.
At the federal level the National Energy Board is charged with the responsibility of ensuring the best use of Canada's energy resources. It regulates the construction and operation of inter-provincial oil and gas pipelines, and the import and export of oil and gas. It exercises jurisdiction and control over mineral lands situate beyond provincial boundaries in the Mackenzie Delta, the high Arctic and the east coast offshore, and makes use of other means of influencing the energy industry through fiscal and taxation measures and moral suasion.
It is evident then that government involvement in the oil and gas industry is not lacking. The question before us, therefore, is not whether to permit government participation in the industry but whether even further participation is warranted.
What can a national petroleum corporation be reasonably expected to contribute to the government's arsenal of existing weapons of control, and to the Canadian economy? What additional problems and costs might it create? Obviously a decision as to the creation of a national petroleum corporation should depend on the weights of the arguments pro and con. The respective weights, however, cannot always be objectively determined. In many cases they are entirely the product of subjective evaluations, and consequently are not quantifiable at all. It is therefore quite possible for individuals to agree on the facts while disagreeing on the preferred policy option. To the extent, however, that one's preference is based on factual considerations, it is important that the facts be accurate.
In the current controversy over the establishment of a national petroleum corporation, enough fanciful powers have already been ascribed to such a corporation to warrant a warning as to what it cannot do.
A national petroleum corporation cannot ensure an adequate supply of energy. If future Canadian needs are to be met from Canadian sources, policies beyond a national petroleum corporation will be required to ensure that domestic priorities are met first. If domestic sources of oil run dry, a national petroleum corporation will be unable to protect Canada from oil shortages, just as European state companies have been unable to protect their respective home countries. It cannot ensure a desirable rate of resource development. If the actual rate diverges from the desirable one, policies beyond the establishment of a national petroleum corporation will be required to induce companies to either speed up or slow down their exploration and development activities.
4048

March 12, 1975
Petro-Canada
It cannot ensure low energy prices for Canadians. Provincial electric power corporations have been unable to keep power rates down, even with 100 per cent ownership of the industry. A national petroleum company will not even be able to institute a two-price system shielding Canadians from world energy price pressures. If continuation of such a system is desirable, government policies beyond the establishment of a national petroleum corporation will be necessary.
Finally, a national petroleum corporation, unless it makes up the major part of the petroleum industry, cannot equalize oil prices in all regions of Canada.
In short, there are few tangible policy objectives which a national petroleum corporation could achieve in the absence of support from additional government policies, and few tangible policy objectives which could not be obtained without establishing a national petroleum corporation.
What arguments can be advanced against the creation of a national petroleum corporation? First, I suggest it cannot be demonstrated that such a company would provide Canadians with either more oil or cheaper oil than will be provided by the existing private industry. Second, it is estimated that the cost to Canadian taxpayers of creating a national petroleum corporation which would be a significant force in the industry would amount to between $3 billion and $6 billion, and that the task would take from 15 to 20 years to accomplish, even assuming a high degree of exploration success. Such an assumption cannot be made in absolute terms. Moreover I would point out that, within the 15 to 20 year time frame I have mentioned, alternative energy systems will likely emerge, and in the result Canadian taxpayers may well have created an obsolete industrial entity.
The federal government, through its participation in Panarctic, its ownership of frontier reserves, and its fiscal jurisdiction, already possesses the capacity to ensure adequate participation for all Canadians in the possible economic benefits to be created by the petroleum industry without putting at risk the hard-earned tax dollars of Canadian citizens in massive amounts.
Finally, in a period of our economic history when Canada is experiencing a horrendous rate of inflation, it is singularly inappropriate for its government to pre-occupy itself in an empire-building oil exploration venture which will exacerbate rather than modify the inflationary pressures at work in our economy, and will render more scarce already scarce materials, personnel and hardware which would otherwise be deployed by the private sector.
Let me make this clear, Mr. Speaker-our party supports the government's initiative in Syncrude. Indeed, that initiative meets squarely the criterion referred to earlier in my remarks, namely, that the private sector was clearly unable to meet a demonstrable economic need in the tar sands development project. Without the initiatives taken by the Minister of Energy, Mines and Resources (Mr. Macdonald) on behalf of the Government of Canada and, as well, by the governments of Alberta and Ontario, Syncrude would have floundered, and Canada's ability to utilize on a long term basis what really constitutes our energy ace-in-the-hole would have been jeopardized-a risk we simply could not undertake.

I have no problem either with respect to Petro-Canada assuming ownership of the government's interest in Panarctic, nor with it assuming responsibility for acquiring offshore gas or oil. If amendments to the bill were introduced limiting its scope to these activities, namely, tar sand development, Panarctic, offshore crude purchases, and research and development into alternative energy sources, they would enable easy passage at second reading of the bill so far as this party is concerned. However, so long as the bill remains in its present form, enabling the minister and the government to embark on a high risk entrepreneurial adventure bankrolled by the taxpayers of Canada, we of the Conservative party will remain opposed to its passage.


Hon. Alvin Hamilton (Qu'Appelle-Moose Mountain):: question of keeping up with the Joneses; because other countries have some form of national enterprise in the petroleum industry, therefore Canada should have something similar. That is the essence of the question.
I should like to put forward a better alternative for Canada. In the closing part of my remarks I think I will be able to make it clear that this is not an idea that has just been produced over the last two or three years. It is a lifelong ambition of mine, knowing full well that if it is achieved in the way I see it, the potential for Canadians as individuals is beyond measure.
Canada is one of half a dozen nations in the world that, for the next 100 years or so, will have surplus resources. The opportunity that this gives us must not be lost by the fumbling or posturing of politically oriented government. So far as political orientation is concerned, I suggest that the people of Alberta and Saskatchewan are not the enemies of Canada. As I have pointed out in this House before, every Canadian must realize, if he is morally just, that when the people of those two provinces, through their governments, voluntarily subsidize the consumers of oil in Canada to the tune of almost $3 billion a year as part of their contribution to national strength and unity, they are obviously not the enemies of the people of Canada. But this political issue has disappeared. The issue now is how to take the best course of action to bring to the people of Canada the opportunities our resources give them at a time when the world needs our resources so desperately.
I think the simplest, easiest and best alternative is to let Canadians as individuals own this country. If the government threw away as unworkable, immoral and wrong, the silly budget that we have just passed, and brought in a new budget providing a tax incentive to Canadians as individuals to increase their ownership of the five major companies that control the oil industry in Canada, this could be done within three years. Then Canadians as individuals would own the majority of the shares in the five major international oil companies that presently control our oil resources.
The following figures are based on tabulations that were made about a year ago, but their parameters are still valid. At the present time the total value on the marketplace of the five major oil companies that control the bulk of our oil and gas resources is about $9 billion. Individual Canadians, who through institutions have invested in these oil companies, own about 30 per cent, roughly one-third, of this $9 billion worth of capital assets. If we gave them an inducement of $500 a year, say, how long would it take the Canadian work force to get control of another one-third of these five major companies?
At the present time the government offers inducements under the Income Tax Act to people who want to look after themselves in their old age; they are permitted to invest up to $2,500 in a registered retirement savings plan, or up to $4,000 if they are self-employed. When the figures are published in another year or so for the year 1974-75- people had till the end of February to apply for this plan- they will indicate that almost 45 per cent of the Canadian work force is taking advantage of this inducement to invest in a registered retirement savings plan.
Petro-Canada
People know these registered retirement savings plans give them a very moderate return in interest on their investment, but because they have this incentive of reducing income tax by this device, over 40 per cent of our Canadian working force is putting money into this type of savings.
Let us assume that just 20 per cent wanted to put their money into the ownership of these large oil companies at $500 a year. It would then take about three years before Canadians, as individuals, would own the majority of the shares of these five major oil companies.
It is so easy to get control of this oil industry, if we get the majority of shares into the hands of individuals, to me it has been a matter of shock and concern that no finance minister in my day has ever made this move. Every move we have had on the part of our tax collectors, at least in my day, which goes back a few years, has been in the direction of doing things that turn the ownership of our resources over to people outside the country.
The Canadian working man wants to have a stake in the future, and I include farmers, clerks and everybody else in that designation. They want the opportunity to share in the profits that will occur.
The oil companies calculate that it will be necessary in Canada over the next 25 years to invest $250 billion in the development of our oil and gas reserves and appurtenances. That is an investment rate of $10 billion a year. Let us look at this now as an inducement to those Canadians who want to own Canada as individuals. If the bulk of this investment comes from these five companies, and if the working man is given an inducement to own these companies, then as a result of the investment of that $250 billion some will end up as assets, and by the end of the century, 25 years from now, that $250 billion investment may well make these companies worth about $100 billion or $150 billion on the market. Where can a working man find an investment today in which he can put $500 a year, saving income tax on it, knowing that down the road when he wants to retire he is not tied to a fixed income type of thing, but rather tied to something that is growing with the country?
I should think we would have no trouble in getting 20 per cent of the working force in this country to take advantage of that opportunity. I should think the rush would exceed the rush into registered retirement savings investments. Once we got finished buying out the oil companies why should we not move into all resource companies, one after the other? We would not be leading the working man into a blind alley. This is a risk investment, sure, but the law of averages is with us, and the wealth that will come from this type of development would be in the hands of Canadians as individuals.
If we start a Petro-Canada company it will take 10, 15 or 20 years to build it up. With all the knowledge you can get from science and modern technology such a company will not find oil unless there is one ingredient, and I will not shock your ears, Madam Speaker, by telling you the vulgar word for that in the oil industry, but that one ingredient is luck. They have a different word for it. In other words, the brainiest men you can hire to look for oil, with all the
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March 12, 1975
Petro-Canada
information they can obtain, with the basic fundamental knowledge of geology, and all the information you can get from geophysical gimmicks, will not discover oil until somebody with a God given insight figures out where to punch the hole.
Canada was absolutely helpless in so far as the supply of oil and gas was concerned in 1946. All the big companies that were here in the 1930's got out of Canada in the war years after spending millions of dollars without any luck. We still had to import our oil at that time. One of the last companies to remain was a small subsidiary of an American company called Exxon, or as it was known at that time, Jersey Standard. It had a small subsidiary in Canada called Imperial. After looking at all the tough luck they had during the previous period of 25 years or so, the directors decided they would drill one last well, backing their geologists in one more effort.
One very low level man kept on telling them they were looking for the wrong type of structure. With his knowledge of the formation of the earth's surface on the prairies he told them they should be looking for reef fields. The men drilling that last well on that last desperate gamble at Le Due pulled out the pipe after going through that reef, and that was the big Le Due find. From that point on we have found reef fields all over Alberta and in a few places in Saskatchewan. That man is dead today. He had the God given insight to put his finger on something that in retrospect was obvious, yet with all the high-priced help the oil companies had they were not able to figure it out.
There always has to be that person with the insight in each area of the world, so what guarantee has any company that it can get that man in its employ? You never know who he is, because he looks the same as every other human being. One of the reasons we have had doubtful success in the Mackenzie River basin and on the fringe of the Beaufort Sea is that the three top men in Canadian oil development are no longer available. We are relying on the law of averages to find oil and gas. What we need is an individual with God-given inspiration, and what guarantee is there that Petro-Can will find that man? This whole thing depends on a matter of luck, backed up by tremendous resources and all the knowledge you have collected in respect of exploration.
The point I am making is that we cannot say we oppose Petro-Can in principle. All we are saying is that it will involve a tremendous draw on the people's money in order to set up this huge corporation which, in ordinary logic, has no chance of success for 15 or 20 years. Why should we go to all this trouble when we have in place international oil companies which are out looking for oil? These companies are not our enemies in this regard.
We have been lax as Canadians in not looking after our own interests. What we want is the full benefit of our resources, and this involves not only laws to control these corporations that operate in our country, but the ownership of the shares so that we can take the profits. I would suggest, as a very simple and fundamental alternative, that we should change our income tax regulations to allow individuals to claim exemption from tax on an investment of $500, $750 or $1,000 a year provided it is invested in the purchase of the stocks or shares of these big oil companies, to start with, and then of all the other resource companies

we want to own. I think that this is a simple alternative for Canada, and a better one.
Just to demonstrate that I am not talking simply as an individual, I will quote the first seven points of a program published last March, a year ago, as the Progressive Conservative policy entitled "Resources for Canadians". It reads:
1.	Canada in 1974 urgently requires a comprehensive resources
policy.
That we do not have.
2.	The Progressive Conservative party in government initiated the northern development policy to open up our resource areas for exploration, set up the National Energy Board to give control and ownership of the transportation of oil, gas and electricity to Canadians, originated the oil and gas regulations in federal lands to protect the Canadian future, and worked with the provinces on hydro power development and transmission.
3.	As a result Canada derived great benefits, particularly in terms of non-renewable energy resources. What is needed now is a clear-cut statement of policy by the federal government and the provinces in order that industry and the public can proceed in proper priority to undertake the actions required for Canadians to take full advantage of their resources in the national interest. These future projects have a great potential for Canada not only in material wealth, but in adding to the quality of life of all Canadians in all parts of the country. In short, an imaginative resource policy properly carried out is the main foundation of our development strategy and our life-style for centuries to come.
4.	To maximize the benefit to Canadians the Progressive Conservative party believes that as a cornerstone of such a policy for the 1970's and the 1980's Canadians must dedicate themselves to acquiring and holding ownership of more than 50 per cent of the non-renewable resource industries in Canada.
That is what I proposed a few minutes ago.
It goes on to read:
5.	A Progressive Conservative government would take the lead in this direction through the establishment of a Resources Canada program. In conjunction with overall national development strategy the Resources Canada program would be directed to this objective. A Progressive Conservative government would negotiate realistic arrangements for the phased marketing of foreign-held shares to accomplish the objective in an orderly fashion.
6.	It would also be the aim of a Progressive Conservative government to see such acquired Canadian ownership widely held and steps would be taken to encourage and facilitate opportunities for the average Canadian to participate. Such steps would include appropriate investment incentives for Canadians of modest means.
7.	We propose an overhaul of the federal Income Tax Act to provide a "Canadian-firts" policy with respect to resource development.
Those are just seven points out of 22, but they state in an orderly fashion what I have been trying to propose as a better alternative.
The arguments for a Petro-Canada national corporation are only two in number, as I see it. One is that we need some organization in Canada to deal directly with the organizations that exist in other countries. It has been clear for many years that Venezuela, for example, wants to deal with Crown corporations or agencies rather than with big international oil companies. The people of Venezuela have been asking themselves how they can get national sovereign control over their wealth, their oil. Their oil was controlled almost completely by large international oil companies. With the surplus oil in the world over the last 50 years, in effect these companies controlled the destiny

of Venezuela. Venezuela wants to deal with either a Crown corporation or an agency of Canada, it does not care which.
This type of feeling is expressed by nearly all the oil producing countries. For reasons of nationalism they wish to avoid as much as they can dealing with international oil companies, which they consider to have dominated them over the last 50 years.
I think that the minister could make a very good argument on this score, but when I raised this question in the House a year and half ago and pleaded with the minister to establish some form of national structure, it turned out that there was one in place already. During the war the then minister of trade and commerce, the late C. D. Howe, had set up such a Crown corporation with the purpose of buying oil or the other products that we needed to carry out the war effort. That organization has sat idle for all these years, and we only discovered it at the time of emergency a year and a half ago.
I think that if we simply want this type of structure to deal with other countries, it is already in place. Of course it needs strengthening in terms of its personnel so that they are not babes in the woods in the tricky dealings connected with oil and energy resources. But the fact is that that is the reason for having some form of state structure to deal with other states.
The second argument one would advance-and of which I gather the minister was not aware-is related to the fact that under the oil and gas regulations of 1961-if the minister could persuade his colleagues to restore in particular the regulation dealing with how the value of the soil will be shared-approximately 60 per cent of all the oil and gas found in federal lands outside the provinces reverts to the people of Canada. Therefore one could argue that there must be some institution in place to handle this huge volume of oil and gas. If it is in the form of land to start with, decisions must be made as to whether it should be farmed out or dealings undertaken with the company that is the original finder. We must have some government machinery to handle all these choices.
At present we do not have such an organ of the government trained and able to calculate the value of an oil field that is partially developed. One could argue that we need a skilled group to handle this, but if you do have such a skilled group that is part of Petro-Can, and Petro-Can is simply one of the five or six major competitors in finding and distributing the oil, the other five companies will call foul play. So it is not fair competition if the 50 per cent of 60 per cent goes automatically to one company which has not even found the resource.
I think that this argument is sound in theory, that we must have some institution to handle the 50 per cent or 60 per cent that goes back to the people, and we must handle it in such a way as to prevent criticism that we are giving advantage to Petro-Can over other companies.
I put these two arguments to the minister in the hope that he will look at them, with his officials, and not let us be caught in a position that when a major oil or gas find is made we must make a decision on land choice, and are caught with our pants down. That in the north is a serious problem. You have to keep covered up, but we do not have
Petro-Canada
an institution in place to deal with this. We must have an institution right now whereby, if one company wants to lease, we have the machinery for handling our share of the land which comes back to us, and the interests of Canada are protected. But I suggest that that institution will not and should not be Petro-Canada.
I indicated earlier that I wanted to come back to the question of what is good for Canada. In response to the concern of the United States government about the tremendous utilization of resources to carry on the war effort, 23 years ago a group of Americans under the leadership of a man named Paley issued a five volume report telling the American people, according to a list of strategic resources, including both oil and minerals, that their country would soon be helpless and in a desperate position. The target date they estimated for this was 1980.
This same report indicated to the American people, if they wanted to read it, that the oil regulations set up in the United States, which had grown up like Topsy from the early days in Pennsylvania, were wasteful to the people's interests, and the report recommended that oil regulations be changed to give a larger share of the economic rent from these resources to the people of the United States. Not many Canadians read that report, but some did, and I was one.
When I came to this parliament in 1957 I was asked to be the resource minister. Within days after I took over we put through an order in council throwing out the old oil and gas regulations which, in the days of the previous administration, said that all the oil and minerals found went to the party finding them. Then I went before the industry with new regulations based on how the maximum amount of return could be given to the people who owned these resources, the people of Canada, and yet get the money invested to bring them to public use. The oil and gas regulations which were finally promulgated in 1961 ostensibly are still the oil and gas regulations of Canada.
These regulations eliminated all the front end loading charges which add tremendously to the costs of an oil company. They stipulated to the oil companies that in return for taking off all these charges we wanted them, when they came to the production stage or the lease stage, which is ownership, to agree that approximately 60 per cent of the value of this oil and gas would go to the people of Canada, compared to about the 12Vi per cent or 15 per cent the provinces were charging.
The oil companies, after a long debate, accepted that because they found out that if we took off these heavy front end loading charges, even though they received a much smaller percentage of the oil and gas value, that gave them sufficient return in capital to keep them operating. The return estimated to keep them operating was 14 per cent, but the people of Canada, through efforts made in those years between 1957 and 1961, were assured under those regulations of receiving the value of 60 per cent of resources found in federal lands. This, to me, was probably the most I could do for my country. Instead of spending all the money paying interest on charges built up over 15 or 20 years, this money would be paid to the people of

March 12, 1975
Petro-Canada
Canada so they would enjoy some return on these bountiful resources.
The key regulation dealt with a sharing. In the month of February, 1970, five years ago, the government of the day put this regulation in abeyance, and today none of us know what the government officially has in mind to share these resources. Two years ago this allowed rumours to begin that the government had sold out to the oil companies and would give them all these resources, and all that we were going to take back was 10 per cent. I never supported those rumours because I could not believe any government of any name would do such a terrible thing to the people of Canada. That was 1972. This is now 1975, and they still have not restored that cause. All I can gather is that they cannot make an agreement with Newfoundland, and that therefore the development of our oil and gas in federal lands waits until they solve their dispute with Newfoundland over who owns that oil.
I suggest that if the minister would use his considerable influence, and force his colleagues to a decision on what will be the sharing between the people of Canada and the oil companies, we would have much better results for the people of Canada than we would get by this posturing device of Petro-Can. The minister knows, from remarks I have made in committee and in the House, that with the capital intensive cost not only of the oil and gas industry but of all its related industries, the government will have to change its system of financing.
I would like to put to the minister these proposals I officially made here in the House on January 30. Before I made those proposals I gave a copy of a hypothetical cash flow for an oil sands development to the Minister of Finance (Mr. Turner). I suggested he study them. I suggested he take those proposals to the provinces and to private industry and let them study them.
For nearly 25 days in that budget debate we could not get an answer from the minister. Then on the last day he turned down the proposal on the ground that industry was not in the habit of financing this way. If ever I have heard of a reactionary attitude on the part of any responsible minister, that takes the cake. Just because it has not been done before, we cannot do it in the future! He sounded like a bank president. This is what killed our banks; they would not take any new ideas.
I put this to the minister: that if we are going to have development of our oil pools and gas pools in the north and offshore, if we are going to finance these tremendous capital intensive undertakings, he, as the defender of the peoples' rights in all these resources, must take the lead in finding a new way of financing them whereby over half the money or the value of those resources does not have to go to the payment of interest but instead comes back to the people to help pay the costs of government and give us the quality of life we should have.
Just to make certain that it is understood that this is not a one man idea, two weeks ago the United Kingdom accepted this type of proposal. In their North Sea developments the government has told the oil companies that it would charge only 12 'A per cent royalty and then give them a 150 per cent immediate writeoff, which means that if the oil companies have invested over $2 billion in an oilfield, they can pay that off in four or five years, and the

150 per cent represents return of capital, return of all interest and pre-production costs.
Then, after this capital is repaid, the government of the United Kingdom representing the people of the United Kingdom steps in and puts on a petroleum revenue tax of 45 per cent which, added to the 12 V4 per cent, gives them roughly 50 per cent or 55 per cent of the gross returns, almost the same as the figures we put into effect in 1961, where it was roughly 60 per cent. The oil companies will accept that in the North Sea, and they will not suffer because they will get their money back with interest. Afterwards they get an amount which has the effect of giving them 25 per cent on their investment.
Under one of the proposals I made to the Minister of Finance the oil companies would get along with about 19 per cent, but within that range. To say that we are going to have a big Canadian national petroleum company that will be able to buy gas and oil much cheaper, is pure posturing. We should forget about that and think about the needs of the people of Canada. If we do that we must come to the conclusion that they instinctively know that these resources we have had all these years will eventually be needed by the world, and that will be our opportunity. In fact the time is now. As a person who has been interested in this for many years, I am deeply hurt when I see a minister fumbling with something that is so important to Canada.
If the minister wants to do something simple and in the best interests of the Canadian people he should shuffle aside Petro-Canada and ask the Minister of Finance, the Prime Minister and his other colleagues to give the Canadian people, as individuals, a chance to own this country, starting with the oil industry. That would be better for the Canadian people than Petro-Canada. The arguments that can be advanced to end such an institution can also be advanced for other institutions that are already in place or are going to be put in place.


Mr. Fred McCain (Carleton-Charlotte):: Madam Speaker, the continuing change in the basic philosophy of the Liberal government could not be more starkly illustrated than it is in the structure which it is proposed to impose upon Canada in the form of Petro-Canada. The multitude of reasons given in support of the proposition by the minister are really pretty hollow. All the things that he claims could be done with the vehicle of Petro-Canada could be done by a concerned government with the vehicles that are already in place.
I agree that all this has been said before, but I would add that Canadians must recognize the philosophical change in the Liberal Party as illustrated by the present Liberal government. That change, of course, is the belief that no Canadian knows how to handle his own money, his own resources, or maybe even his own family as well as the paternalistic, philosophical group that sits on your right today, Madam Speaker.
As an illustration of this I should like to draw to the attention of the House clause 7(2) of this bill which reads:
March 12, 1975

The corporation shall comply with any directions from time to time given to it in writing by the Governor in Council or the minister with respect to the exercise of its powers.
In spite of all the freedoms which have been exercised and granted in this bill, the final control reverts to the minister at worst, and to the cabinet at the very best. All the other clauses can only be read with that clause in mind-that the minister or the governor in council may direct, redirect, alter the course, or at any moment in time interfere with the operation of the company.
How much will members of this House ever know about the operation of this company? Like other Crown corporations it has all the means of financing such as those that have been extended to the CNR and Air Canada. It has the opportunity for the government of Canada to buy preference shares through the consolidated revenue fund. It also has virtually unlimited capacity to borrow from foreign sources. When one goes through the whole bag of economic opportunities for this company to borrow either from the state or from the private sector, without reply to the taxpayer and the House of Commons, one finds it has a relatively uncontrollable structure, excepting only clause 7(2) under which the government may change its course at any moment in time.
Petro-Canada
It has been suggested that some Canadian oil companies might need help and that this would be a wonderful vehicle for such assistance. Some local companies have been gobbled up by the large corporations, and I must agree that to some extent this is detrimental to Canada. But I submit, Madam Speaker, that we do not need a Petro-Canada if it is the desire of the government to have Canadian people develop petroleum resources with Canadian money. That could very well have been achieved through a glorified CDC or a magnified IDB, or any other vehicle the government might have put in place. Basically, however, the government chooses to socialize the petroleum industry. That is the intention of this bill and the people of Canada should be aware of it.
We should be concerned about the integrity of this government. When the voluntary controls were removed we were advised that the price of gasoline would not rise in the east, but a few days after controls were removed we were told that a 6 cents, 7 cents, or even a 10 cents increase was anticipated in the Atlantic area. The credibility of the government is negligible, and its intentions are questionable at this time. I see it is six o'clock, Madam Speaker.


The Acting Speaker (Mrs. Morin):: It being six o'clock, this House stands adjourned until tomorrow at two
o'clock.
At six o'clock the House adjourned, without question put, pursuant to Standing Order.
\

Thursday, March 13, 1975