1975-10-30

ROUTINE PROCEEDINGS


Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I rise on a matter of urgent and pressing necessity pursuant to the provisions of Standing Order 43 on a matter which has occupied a great deal of attention in this chamber during the past year, I move, seconded by the hon. member for Grenville-Carleton (Mr. Baker):
That the Minister of Labour, fresh from his triumphal appearance at St. John's, Newfoundland, report to the House at the earliest opportunity on the progress of the investigation which he announced in this House on May 21, 1975 into problems surrounding the SIU and put an end to persistent reports that the investigation has been shelved and that Mr. Carson, the respected gentleman appointed to head the inquiry, has been removed from that post.


Mr. Speaker:: Standing Order 43 requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


OLYMPIC GAMES
Mr. Eudore Allard (Rimouski):: Mr. Speaker, pursuant to the provisions of Standing Order 43, I ask for the unanimous consent of the House to deal with a case of urgent and pressing necessity.
Considering that the Olympic Games in Montreal in 1976 will cost about $1 billion and probably will be in the red by several hundred million dollars, which should normally be absorbed by all Canadians, that the whole of Canada will benefit from the fame and international prestige of the games and that some programs which are essential to the development of the city of Montreal, such as the extension of the subway and the purifying of water supplies, may be placed in jeopardy on account of the games, I move, seconded by the hon. member for Champlain (Mr. Matte):
That the House take the necessary measures to ensure that the deficit incurred by the Olympic Games, which are due to take place in Montreal in 1976, be borne by all Canadians.


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


Some hon. Members:: Yes.


Some hon. Members:: No.


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


THE CANADIAN ECONOMY
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I, too, rise under the provisions of Standing Order 43. The matter of urgent and pressing necessity arises from the profound need of the government to find any possible support from any possible element of the trade union movement for its anti-inflation program which heretofor, for some inexplicable reason, has been endorsed only by big business and chambers of commerce across the land. There has also been the related profound need of CBC television news to find the slightest bit of such support for the government so that it could convey such a surprising development to the people of Canada.
I, therefore, move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House compliments the government in obtaining the support for its program from Senator Lawson and further wishes to commend those responsible for the CBC national television news for their gifted insight into the fact that a Liberal appointed Senator announcing support for a Liberal government program constitutes a major breakthrough for the government and thus should be the lead item on the national news.
The House further urges the Minister of Labour, accompanied by CBC television cameras, to travel to New York in order to obtain additional support from their one other friend in labour, Mr. Hal Banks.


SUGGESTED REFUSAL BY MEMBERS OF SALARY INCREASES FOR 1976-MOTION UNDER S.O. 43
Mr. John Reynolds (Burnaby-Richmond-Delta):: Mr. Speaker, under Standing Order 43 I rise to present a motion considered necessary and urgent in this inflationary period. In light of the government's proposals to initiate an attack on inflation, and in view of the election

October 30, 1975
Bilingualism
promises made by the Prime Minister (Mr. Trudeau) that a Liberal government would implement leadership during its next mandate, I move, seconded by the hon. member for Prince George-Peace River (Mr. Oberle):
That this House deny the provisions of section 3 of the members' salaries act, Bill C-44, granting a 7 per cent pay increase effective January 1,1976, for members of this parliament.


Mr. Speaker:: Order, please. This motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


CANADIAN BROADCASTING CORPORATION
Mr. Bob Brisco (Kootenay West):: Mr. Speaker, I rise under Standing Order 43 on a matter of urgent and pressing necessity. On the CBC program "Earthwatch" aired last evening, the sportsmen of Canada were portrayed as ruthless killers using aircraft and snowmobiles to track and shoot their quarry. As both these methods are unlawful in Canada, as all ethical sportsmen deplore them and as this film sequence grossly distorted facts presented to the general public, I move, seconded by the hon. member for Prince George-Peace River (Mr. Oberle):
That the government immediately order the CBC either to substantiate the facts depicted by the film, or to make an immediate retraction.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


BILINGUALISM
Mr. Tom Cossitt (Leeds):: Mr. Speaker, I rise under the provisions of Standing Order 43 to propose a motion arising from the government's expressed need to cut government expenditures in the fight against inflation, and also arising from the millions of dollars being spent on the Prime Minister's personal sacred cow, bilingualism.


Mr. Speaker:: Order, please. No doubt the hon. member is aware that an opposition motion on precisely the same subject is to be debated today and it would, I think, make a mockery of our procedures if we were to ask the House to give unanimous consent to debate a motion dealing with the same subject which the House is to debate at three o'clock.


OLYMPIC GAMES
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. In view of the failure of the Olympic Organizing Committee to invite bids from qualified Canadian firms for the manufacture and distribution of Olympic medallions, and in view of the awarding of that licence to a Swiss company, one of the principals of which is also involved in the building of the Olympic Village and in the manufacture and distribution of Olympic souvenirs, I move, seconded by the hon. member for Greenwood (Mr. Brewin):
That this House record its view that qualified Canadian firms should have an opportunity to submit bids on all projects in connection with the 1976 Olympics and, further, that it instruct the government to initiate forthwith a comprehensive inquiry into all aspects of the procedure followed by COJO in awarding contracts and licences.


Mr. Speaker:: Order, please. 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.


LABOUR CONDITIONS
Mr. Rene Matte (Champlain):: Mr. Speaker, under the provisions of Standing Order 43, I ask the unanimous consent of the House to introduce a motion dealing with an important and urgent matter.
In view of the constant conflicts between employers and employees degenerating into strikes which disturb the economy and the social balance of the country, I move, seconded by the hon. member for Abitibi (Mr. Laprise):
That the government appoint a special parliamentary committee whose object would be to find means to control strikes at least in the public and semi-public fields and thus set the example.


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


Some hon. Members:: Yes.


Some hon. Members:: No.


Mr. Speaker:: There is not unanimous consent. The motion therefore cannot be put.
October 30, 1975



ORAL QUESTION PERIOD


Mr. Walter Baker (Grenville-Carleton):: Mr. Speaker, may I direct a question to the Minister of Finance arising from the list of firms to which the Anti-Inflation Board has written about the enforcement of the government's price and profit guidelines. Could the minister confirm that the government was forced to purchase this list, in whole or in part, from outside commercial sources because it did not itself have the necessary information available?


Hon. Donald S. Macdonald (Minister of Finance):: Mr. Speaker, I had not heard that suggestion before, but I will be glad to inquire.


ANTI-INFLATION PROGRAM-REASON FOR OMISSION OF SOME FIRMS FROM LIST OF THOSE COVERED BY GUIDELINES
Walter David Baker: Can the minister explain why a number of the major corporations in categories supposedly covered by the government's guidelines are not on the list? For example, three of Canada's largest development companies-Bramalea, Consolidated Building and McLaughlin-are not on the list. I ask this in view of the fact we have been told this list was to cover even the smallest construction firms.


Donald Stovel Macdonald: Mr. Speaker, I do not know exactly the source of the list, but I understand there was not information available exactly corresponding to the guidelines. Indeed, some firms were included which should not have been and others were left off. I understand that upon public response, the board has since gone out to remedy these deficiencies.


Walter David Baker: Since the names of many of the major corporate power centres in this country, including this government's great friend, Power Corporation, are missing from the list, is it government policy that such companies will be free to manipulate management fees and other inter-corporate relationships with their various subsidiaries without any active surveillance by the Anti-Inflation Board? Was that the policy of the government in the preparation of this list?


Donald Stovel Macdonald: No, Mr. Speaker. As the hon. member might observe in reading the bill, where a corporation has consolidated its financial reports into a single one, where there is this control as deemed by the Income Tax Act, that applies to the company and all of its corporate affiliates. Of course, they all would be covered. Whether the corporation which the hon. member mentioned did that or not, I will look into that. Indeed, I was proposing to lay the list before the committee. However, I would point out to the hon. member that the response to the final part of his question is decidedly not.
Oral Questions


ANTI-INFLATION BOARD-MEMBERS SUBJECT TO CONFLICT OF INTEREST GUIDELINES
Mr. James A. McGrath (St. John's East):: Mr. Speaker, I wish to direct my question to the Prime Minister. In view of the fact that a number of the members of the new Anti-Inflation Board hold directorships in a number of corporations, is it the view of the government that these members of the board shall be subject to the government guidelines of conflict of interest and accordingly resign these directorships forthwith?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, the general answer is yes. I have not looked into each particular case, but those members of the board whom I did contact personally raised this matter with me. It was understood that they would resign the directorships.


ANTI-INFLATION BOARD-INQUIRY WHETHER REPORTS AND ACTIVITIES WILL BE PUBLIC OR PRIVATE
James Aloysius McGrath: In view of the fact that the success of the board will depend largely upon the degree of public support it is able to generate across the country, is it the intention of the government to ensure that the board reports from time to time to the public and operates generally within the public domain, given the wide discretionary powers that it has, or is it the view of the government that the board should operate in secrecy and report to the government in the same vein?


Pierre Elliott Trudeau: No, Mr. Speaker. The Minister of Finance tells me this is already provided for in the bill, namely that there will be public reports and public activities. The Anti-Inflation Board is perceived as an organization that will go out and help people understand about inflation, its causes and how they are trying to remedy it. I see the board very much like the former Food Prices Review Board under Mrs. Plumptre which had a great effect on persuading the public of its activities and communicating with them.


NATIONAL SECURITY
John Edward Broadbent: Mr. Speaker, I have a question for the Prime Minister. Following recent statements by Premier Bourassa and the Hon. Eric Kierans, a member of the federal cabinet in 1970, to the effect that neither of these gentlemen believed that an apprehended insurrection or state that would be appropriately described by that phrase existed in the province of Quebec at the time of invocation of the War Mesures Act, and since such action involved a major infringement upon the civil liberties of Canadians, is it the intention of the government to proceed with an inquiry under the Inquiries Act which could lead to a full investigation into the justification for the invocation of that act?

October 30, 1975
Oral Questions


Pierre Elliott Trudeau: Mr. Speaker, I do not know exactly what Mr. Bourassa or Mr. Kierans have recently been thinking or saying.
But I do know what they said at the time the War Measures Act was invoked. From Premier Bourassa we had a letter which I believe was read by the President of the Privy Council for the record a few days ago, a letter which specified that he as well as the authorities of the City of Montreal apprehended insurrection, and they were asking us to take these strong measures so that they could do their proper job of maintaining the peace.
In the case of Mr. Kierans, he was a member of the cabinet and he supported the cabinet at the time.


INVOCATION OF WAR MEASURES ACT IN 1970-BELIEF OF PRIME MINISTER THAT STATE OF APPREHENDED INSURRECTION EXISTED IN QUEBEC
John Edward Broadbent: Since, as the Prime Minister knows, ultimate responsibility for the invocation of such an act rests with the federal government, no matter what a particular provincial government might request, I should like to ask the right hon. gentleman whether it is still his view that a state appropriately described as an apprehended insurrection existed in the Province of Quebec in the fall of 1970.


Pierre Elliott Trudeau: I can say quite clearly that if people in Quebec, the government of that province and the administration of the City of Montreal, had not told us they were convinced that there was a state of apprehended insurrection we would probably have looked twice before invoking the War Measures Act. But they did make this statement quite clearly to us; it was our judgment that they were right, that they were well informed; it was our judgment that there was a state of apprehended insurrection and therefore we declared the War Measures Act.


John Edward Broadbent: Since the then Minister of Justice and other ministers of the Crown said they hoped that after some time had elapsed a full revelation of all the facts which led to the government's decision could be made, given that kind of commitment, which was no more than an asserted plan of intention, does the Prime Minister not feel, now, that in the light of recent statements by Premier Bourassa in particular, the man who was then, as he is now, premier of the province, to the effect that his view was wrong, that if not under the Inquiries Act then in some other way a full public investigation of all the circumstances leading to the original decision should be made?


Pierre Elliott Trudeau: I repeat, I do not know exactly what Premier Bourassa thinks about this, but I do not take for granted the hon. member's assertion that he is now saying there was not a state of apprehended insurrection. It would surprise me greatly if he were to say that.


An hon. Member:: He said it on TV over the CBC.


Pierre Elliott Trudeau: He said the contrary in writing, and I would be very surprised if he were to say the contrary now if one listened to everything he had to say.


John Edward Broadbent: He did.


Pierre Elliott Trudeau: Well, will the hon. member send me a record of what he said on Sunday night?


An hon. Member:: You were more interested in Kojak!


Pierre Elliott Trudeau: As somebody said, Mr. Speaker, I was more interested in Kojak.


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: With regard to the other part of the question as to what certain cabinet ministers think, the hon. member is free to ask Mr. Kierans. I do know I stated publicly both at that time and since, that the essence of the reason we invoked that act lay in a circumstance of which everyone was aware because I read a document to the House saying there was a state of apprehended insurrection in the minds of the authorities of the Province of Quebec. Our judgment was that they were making the right estimation at the time, and therefore we acted. I am not asking for any hidden evidence to support our action. It is all on the record and I will debate the subject any time with the hon. member.


OLYMPIC GAMES
René Matte: Mr. Speaker, I would like to put a question to the Prime Minister.
In answer to a question asked by my colleague from Rimouski yesterday, the Acting Prime Minister stated that the federal government would not assume any obligation toward the anticipated deficit of the Olympic Games. Therefore, I would ask the Prime Minister whether this decision is irrevocable and whether one should take it for granted that there will not be any kind of monetary participation in financing the games. In other words, does the government accept that these games, involving all of Canada, does he accept in principle that Montrealers or the province of Quebec should assume the cost of the games?


Pierre Elliott Trudeau: Mr. Speaker, I think there is a misunderstanding. The hon. member suggested that the federal government is taking no share of the cost of the games. That is of course a false impression. The federal government is contributing to the organization of the games in several ways: through military and police support, diplomatic services, housing assistance and so on, which amount to tens of millions of dollars.
As to the financing of the games, the hon. member also knows that the federal government-our government- introduced legislation that allowed the games to be selffinancing: measures relating to coins, stamps, the lottery and so on. Therefore, it would be spreading a falsehood to say that the federal government is not supporting the
October 30, 1975

Olympic Games. What we are saying is that the Quebec government and the Montreal administration agreed with us, several years ago, that they would not ask us to take up the deficit, if there was any.
It was claimed at that time that there would be no deficit. However, it was agreed that we would not be asked to make it up, should there be one. Not so long ago, the Prime Minister stated again that he did not intend to ask the federal government to help them make good the deficit. However, if the hon. member insists that we spend money financing projects to which we are not required to contribute, let him say so bluntly, but neither Premier Bourassa, nor Mayor Drapeau, nor any of the COJO people have asked us to make up any part of the deficit. They know that we have already contributed very substantially and continue to contribute to the Olympic Games, for which they are very grateful.


AIR CANADA
Elmer MacIntosh MacKay: Mr. Speaker, I have a question for the Minister of Transport. Because of increasing media speculation, such as the current article in the Financial Post, concerning the contents of Judge Estey's report, realizing full well the government's difficulties in terms of translation, and also keeping in mind that the government itself knows the contents of Judge Estey's report, will the minister not agree that it would be best to make a decision on the report's recommendations soon instead of waiting for the official tabling, which could take many weeks?


Hon. Otto E. Lang (Minister of Transport):: Mr. Speaker, I indicated in answer to the first question concerning the report, I believe last week, that it would be our intention to consider the contents of the report even during the period that printing and translating were underway.


Elmer MacIntosh MacKay: A supplementary question, Mr. Speaker. I am reassured by the minister's answer, and I repeat that I realize the government has problems and that I do not expect the minister to perform miracles in getting the report before the House. But again I ask, is not the minister willing to concede that a lot of harm is being done in many ways to the airline by continuing to delay releasing the report? Once again may I ask him whether he will consider taking definite steps to implement some of the recommendations on a matter of great importance affecting this country's national airline?


Otto Emil Lang: Mr. Speaker, certainly I am concerned that any harm may be done, and indeed I may have to consider making some comment about the clear and sound nature of the airline operation which emerges. However, I will reflect on that as I read the press statements referred to.
Oral Questions INDUSTRY


PROPOSED INTRODUCTION OF INCENTIVES TO INCREASE PRODUCTIVITY
Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, I have a question for the Prime Minister. As the chairman of the Economic Council of Canada has stated in his latest report that Canada's productivity is almost the lowest of all industrial nations, and as output per man hour in Canada actually decreased last year, the first decline in the last 15 years, would the Prime Minister give consideration to introducing industrial incentives to be paid in direct proportion to increases in productivity so as to make possible lower costs and prices, reduce inflation and promote greater sales of Canadian products both in Canada and in the export markets?


Pierre Elliott Trudeau: Mr. Speaker, the spirit of the question is valuable and constructive. I think the importance of increasing productivity is very great. I would not argue the details as to why at this particular term of their productivity cycle certain European countries are higher than we are. As the hon. member knows, when there is an upsurge in the cycle productivity tends to increase. We are confident this will happen in Canada. The suggestion in respect of incentives is a valuable one. Knowing of the hon. member's concern with this I asked our people in the Privy Council and the Department of Finance to examine it.
The hon. member will note that of course there already are in the guidelines, as we published them, productivity incentives in the market place for those firms which do increase their productivity. We will examine other constructive methods of achieving that result. It is very important that we realize that we have to make serious improvements in productivity.


ROYAL CANADIAN MOUNTED POLICE
Mr. Heath Macquarrie (Hillsborough):: Mr. Speaker, I have a question for the Solicitor General which is prompted by a news item, with which he is familiar, in the Globe and Mail that casts the shadow of subversion or worse over thousands of decent Canadians of Arab descent. Will the minister clarify the situation outlined in the story and at least indicate if the 14 persons are under surveillance, as the recently discovered security director Mr. Toupin states, or are not under surveillance, as the minister has stated?


Hon. Warren Allmand (Solicitor General):: Mr. Speaker, the RCMP has told me there is no plot among Arab Canadians such as outlined in the Globe and Mail story published the other day. The RCMP has informed me it is continually on guard against any type of terrorist plot in Canada, particularly in view of the Olympic games coming up next year. At the present time there is no such plot as set out in that article.

October 30, 1975
Oral Questions RESOURCES


SUGGESTION CANADIAN STEEL COMPANIES ESTABLISH IRON ORE PELLET SOURCE IN NORTHERN ONTARIO-GOVERNMENT POSITION
Hon. Alvin Hamilton (QiTAppelle-Moose Mountain):: Mr. Speaker, my question is addressed to the Minister of Energy, Mines and Resources. In view of the fact that the three large steel companies in Canada, that is Stelco, Dofasco and Algoma, have made the decision to tie into the high cost iron ore pellet source from the United States, has the government made any approach to the governments of Ontario, Manitoba, Saskatchewan and Alberta to push for an integrated pelletizing operation in northwestern Ontario so we can keep our steel prices lower in Canada than in the United States?


Hon. Alastair Gillespie (Minister of Energy, Mines and Resources):: Mr. Speaker, I have been informed that there have been discussions in respect of certain deposits in northern Ontario which might be used by Canadian mills in various parts of Canada, not just from Ontario. As to whether those particular firms have given recent consideration to the proposal put forward by the hon. member, I cannot say, but I would be very pleased to find out and let him know.


Francis Alvin George Hamilton: Mr. Speaker, when the minister is looking into this subject will he discuss with officials of his own department, who I know for the last two or three years have been supporting this type of integrated operation with the steel plants in the three prairie provinces, the possibility of gaining access to these very rich iron ore deposits in northwestern Ontario?


Alastair William Gillespie: Mr. Speaker, we have already had this kind of discussion.


THE CANADIAN ECONOMY
Mr. John Gilbert (Broadview):: Mr. Speaker, my question is directed to the Minister of Finance and arises from remarks by the Ontario Minister of Education, Mr. Wells, in connection with contract negotiations involving Metro-Toronto teachers. Can the minister inform the House whether, in the case of Toronto teachers and, indeed, in other similar situations, he endorses Mr. Wells' view that contract negotiations should proceed between employers and their employees without regard, at least initially, to potential complications that may arise from the federal government's guidelines on wage and salary increases?


Donald Stovel Macdonald: Mr. Speaker, I might perhaps put it in a different way. I would say that the fact that we do have the guidelines and the restraint program outstanding should not prevent parties from getting down to the bargaining table. We hope they will be guided at the bargaining table by the fact that the
(Mr. Allmand.]
guidelines and the request have been put out to all Canadians to restrain their demands on the economy. Of course, when they do have a completed contract, and this is on the assumption, firstly, that the bill is approved by the House and, secondly, that the Ontario government is prepared to enter into an agreement under the bill to give responsibility to the federal government in this area, that contract should be brought forward for the scrutiny of the Anti-Inflation Board, if that seems appropriate at the time.


ANTI-INFLATION PROGRAM-ADVISABILITY OF PAYING WAGES HIGHER THAN GUIDELINES WITHOUT CONSENT OF BOARD
John Gilbert: Mr. Speaker, does the minister agree with Mr. Wells in saying that once an agreement is reached between the school board and the teachers the school board should pay the higher compensation without the consent of the Anti-Inflation Board?


Donald Stovel Macdonald: Mr. Speaker, my advice to the school boards or, indeed, to any other organization in Canada, is that if there be any doubt in this regard in respect of the contract being entered into they should confine themselves to the payment of the guideline limits and should be seeking advice as to any excess that might be payable.


Mr. Baldwin:: Maybe they started discussing it last July.


ANTI-INFLATION BOARD-LENGTH OF TIME TO DEAL WITH APPEALS
John Gilbert: Mr. Speaker, does the minister agree with Mr. Wells that it will take approximately a year and a half before a case can go before the Anti-Inflation Board because of the lengthy appeal procedures?


Donald Stovel Macdonald: No, Mr. Speaker. I think the Ontario minister misunderstood the procedure. The board can, of course, conduct a quick scrutiny of the situation and, in appropriate cases, refer the matter to the administrator. The onus will then be on the party ordered against to change the decision, but the decision will stand and the party will be bound by it until the appeal tribunal determines otherwise.


ADMINISTRATION OF JUSTICE
Mr. Jacques Lavoie (Hochelaga):: Mr. Speaker, I should like to ask the Solicitor General a question.
Since some organizations in the constituency of Hochelaga are already dealing with the prevention of juvenile delinquency and also with the possibility of providing jobs for ex-inmates, could the Solicitor General tell the House whether those organizations could get some financial assistance from his department to achieve their goals?
October 30, 1975


William Warren Allmand: Mr. Speaker, the Department of the Solicitor General does fund projects in respect of juvenile delinquents and assists groups in finding work for ex-inmates. Whether the groups in the hon. member's constituency would be eligible depends on the applications. I would suggest that they forward their applications which will be considered in the usual way.


FISHERIES
Mr. Donald W. Munro (Esquimalt-Saanich):: Mr. Speaker, I should like to get some clarification on an answer that was given to me recently by the Minister of the Environment. For that reason, I will put my question to the Minister of State for Fisheries.
Could the minister assure the House that patrol vessels which protect our fisheries have resumed their usual activity or does he have to admit that those patrols have been substantially reduced, which could cause irreparable damage to our fisheries as well as to our claims under the law of the sea convention?


Hon. Romeo LeBlanc (Minister of State (Fisheries)):: Mr. Speaker, if there has been some reduction, it was because the Tanu needed repair and it was several days before it could put back to the sea again. Six out of 17 of our patrol ships have resumed their activity or will next week to check herring stocks. I must say to the hon. member that it is normal at the end of the salmon fishing season to assemble the fleet, either to allow certain crews to go on leave or to rearrange the schedule of some other crews. I agree with him that there are some financing difficulties and that we must maintain a stock for spring fishing especially herring during the month of March, but I can assure him that it is not our intention at all to leave that part of the sea unprotected.


FINANCE
Mr. Allan B. McKinnon (Victoria):: Mr. Speaker, my question is directed to the Minister of Finance. Yesterday in reply to a previous question of mine the minister said they were negotiating with the chartered banks an alternate system for getting the November 1 interest payments on Canada Savings Bonds into the hands of the recipients.
I understand the negotiations have been successful. Can the minister give us any details that would clear up the question of how the savings bond holder is to get the interest payment?
Oral Questions


Donald Stovel Macdonald: Mr. Speaker, I should like to express my appreciation to the hon. member for Victoria for his consideration and initiative in this regard. As he indicated, we have now completed arrangements with the chartered banks whereby recipients of interest payments on the Canada savings bonds falling due November 1 may obtain payment of those amounts by application to the chartered bank, credit union or other financial institution with which they deal. In this respect persons should contact their appropriate fiscal representative of that kind, indicating their full identity, and the government will make every effort as soon as possible to get those cheques into the hands of the financial institutions for payment to those individuals.


EXTERNAL AFFAIRS
Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, my question is for the Secretary of State for External Affairs. Was Mr. Lajoie, head of CIDA, stating government policy when, speaking to the Canada Grains Council, he suggested Canada should have its traditional customers for grain, Russia, China, Japan and Great Britain, stand aside until the starving third world countries have their needs filled.


Hon. Allan J. MacEachen (Secretary of State for External Affairs):: Mr. Speaker, I have not seen the comments attributed to the gentleman in question, but certainly he was not speaking for me in making that statement.


ADMINISTRATION OF JUSTICE
Robert Hylton Brisco: Mr. Speaker, my question is for the Solicitor General. In view of the fact that sportsmen of Canada were portrayed as ruthless killers using aircraft and snowmobiles to track down and shoot their quarry on the CBC film "Earthwatch" and as both these acts are against the law in every province in Canada, would the minister undertake to ascertain where the film sequences were taken and who the persons were that participated in these illegal acts, particularly in Canada?


William Warren Allmand: Mr. Speaker, I am not sure whether that comes within my responsibility but I will check and report to the hon. member.

October 30, 1975
Oral Questions


THE CANADIAN ECONOMY
Mr. Claude Wagner (Saint-Hyacinthe):: Mr. Speaker, I should like to put a question to the Minister of Finance.
In view of the statements made yesterday by the leaders of the two most influential unions in Quebec, the CNTU and the QFL, who went as far as calling the minister an "arrant liar", statements with which I do not associate myself, can the minister tell the House if he maintains his assertion that he unofficially has the support of the Quebec union officials for his anti-inflation measures and, if so, is he willing to name the leaders who have assured him of their support?


Donald Stovel Macdonald: Mr. Speaker, I must point out that in fact I did not speak to those two Quebec unions leaders. What I said in Montreal was that, I myself, as well as some of my colleagues, have spoken to many union members who support the government program. I also pointed out the fact that some other union leaders, and I mentioned for instance Mr. Joe Morris, have indicated, privately and publicly, that they were against them. But actually I did not mention the two union leaders the hon. member has referred to, nor am I thinking of them in my remarks.


Claude Wagner: Mr. Speaker, I have a supplementary.
Would he be prepared to agree with the suggestions of the union leaders in Quebec and meet them in a public debate to discuss the relevancy of the anti-inflation measures?


Donald Stovel Macdonald: I am not necessarily against such a debate but it seems to me more progressive to have private meetings. If they can make useful suggestions to fight inflation, I would be prepared to see these two gentlemen.


INDIAN AFFAIRS
Mr. F. Oberle (Prince George-Peace River):: Mr. Speaker, in the absence of the Minister of Indian Affairs and Northern Development, I should like to ask the Prime Minister if it is now the intention of the government, with the appointment of Mr. Digby Hunt as an Indian claims commissioner, to take the question of Indian claims settlement into the political arena rather than make it possible for natives in the future to take their grievances to the Canadian courts.


Hon. Jack Cullen (Minister of National Revenue):: Mr. Speaker, I would not want to upstage, nor could I, the Minister of Indian Affairs and Northern Development but I think in the interest of giving the hon. member a good

answer we will wait until tomorrow and I will take the question as notice.


IMMIGRATION
Mr. Derek Blackburn (Brant):: Mr. Speaker, I should like to direct my question to the Minister of Manpower and Immigration. I would like to know whether it is now the policy of the government to allow aliens who have been involved in drug trafficking abroad to remain in Canada on so-called humanitarian grounds because they might face prosecution if they were deported. I say this in reference to General Dang Van Quang who has been under a deportation order for nearly four months which order the minister has not carried out.


Hon. Robert K. Andras (Minister of Manpower and Immigration):: Mr. Speaker, in respect of the deportation of General Quang it is a matter of record of course that discussions are taking place, most particularly with the United States authorities to see whether there is any possibility they will accept him under their immigration law and there has not been a refusal on that score as yet.
Very frankly and candidly I would much prefer to see the deportation of this person, as unacceptable as he is for reasons already stated, effected to that country rather than face the final decision as to whether or not to send him back to South Vietnam. While that possibility has any reasonable chance of coming forth I would prefer to delay, even though it may take a few more months for a decision to be rendered.


Derek Nigel Ernest Blackburn: Mr. Speaker, I should like to ask the minister if in the final analysis there is no other country that will take Quang will he assure the House that he will carry out that deportation order to South Vietnam.


Robert Knight Andras: Mr. Speaker, I will make that decision when the matter of other alternatives is clarified.


FOREIGN INVESTMENT
Mr. Bill Kempling (Halton-Wentworth):: Mr. Speaker, I have a question for the Minister of Industry, Trade and Commerce. Can the minister advise if there has been any progress in the discussions between his officials and officials of Westinghouse, White Consolidated Industries and General Steel Wares and whether there has been an extension to the October 31 closing date of the offer of General Steel Wares?


Hon. Donald C. Jamieson (Minister of Industry, Trade and Commerce):: Mr. Speaker, as the hon. member may be aware a number of meetings have been carried on in recent days. As of this morning I instructed my deputy
October 30, 1975

minister to suggest to General Steel Wares, the potential purchasers, that they seek an extension. I am waiting until after the question period to meet with my deputy. I have no reason to believe that that extension will not be sought. I have had representations from various groups which the Minister of Labour has brought here and I have given them that assurance that we will look for the extension. If it occurs, then further discussions will continue, starting I believe tomorrow, with representatives of GSW and then the other companies involved in subsequent days over whatever the period of extension is.



BROADCASTING


John Douglas Reynolds: Mr. Speaker, my question is for the Acting Minister of Communications. In view of the fact the CRTC hearings will not be held in Vancouver until February to decide whether or not British Columbia should have a French language television station can the minister assure the House that all work is stopped in respect of setting up the transmitter on Mount Seymour for that station?


Otto Emil Lang: I cannot, Mr. Speaker, but I can assure the hon. member that the question of any broadcasting would depend upon a proper license.



TRANSPORT


Mr. Steven E. Paproski (Edmonton Centre):: Mr. Speaker, I have question for the Minister of Transport.


Some hon. Members:: Hear, hear!


Steve Eugene Paproski: All the ministers on the other side are so amiable today I am sure they will answer all our questions. I know the Minister of Transport will answer me. Does the minister plan to make a statement on motions as to what he plans to do on the impasse in respect of dredging in Canada and when can we expect some statement from the minister?


Otto Emil Lang: I have no present intention of making a statement.


Steve Eugene Paproski: Mr. Speaker, since the former Minister of Transport has said on numerous occasions that the Department of Transport is in a mess and in light of the high cost of construction of Mirabel as well as the multimillion dollars spent on consultant fees, would the present minister like to comment on his department and say it is a lucrative, benevolent mess; yes or no?


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


Mr. Speaker:: Order, please. The hon. member for Capilano.



LABOUR CONDITIONS


Mr. Ron Huntington (Capilano):: Mr. Speaker, I have a question for the Minister of Labour. Further to the announcement the minister made last May about an inquiry into certain problems surrounding the SIU, is he now in a position to report on the results of that investigation and whether there have been any changes in the personnel who were originally charged?


Hon. John C. Munro (Minister of Labour):: Mr. Speaker, the hon. member may be aware that the RCMP were called in to conduct an investigation. I assume the investigation is continuing. If the hon. member wants further details, I believe he should direct his question to the Solicitor General.



ADMINISTRATION OF JUSTICE


Mr. J. R. Ellis (Hastings):: Mr. Speaker, my question is for the Solicitor General. In light of recent tragic events and the concern expressed publicly by the supervising coroner of Ontario, would the Solicitor General undertake to give the assistance of his department to the supervising coroner of Ontario, should he request it, with regard to the tragic events which took place in Ottawa just recently?


William Warren Allmand: Mr. Speaker, I must tell the House that I have not yet received any invitation from the coroner either by telegram, telephone or by any other method whatsoever. I find it rather unusual that he should issue invitations to me in a challenging way through the public press. If we do receive an invitation, we would consider it seriously.



AIRPORTS


Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, I direct this question to the minister in charge of Air Canada, among other things. When I was in Toronto this morning porters brought to my attention the fact that as a result of the cancellation of the porter agreement which has taken place, these porters, despite in some cases many years of good service-some up to 20 years and beyond-have received notices of dismissal. Will the minister look into this matter? Apparently an American com-

October 30, 1975
Oral Questions
pany has taken the place of a Canadian company, and these porters are naturally deeply concerned that a month from now, their notice having been received today, they will be out of work.


Otto Emil Lang: Mr. Speaker, I will be very glad to look into the matter.



LABOUR CONDITIONS


Stanley Howard Knowles: Mr. Speaker, I wish to direct a question to the Minister of Labour. Can the minister indicate whether we might soon see the report of Dr. Noel Hall concerning all aspects of railway pensions?


John Carr Munro: Mr. Speaker, I am as eager as the hon. member to find out the results, which I hope will be very soon.



REQUEST FOR REPORT ON PROGRESS ON ESTABLISHMENT OF ENRICHED URANIUM PLANT IN QUEBEC

Mr. Roch La Salle (Joliette):: Mr. Speaker, I wish to put a question to the Minister of Energy, Mines and Resources.
I would like to know about the progress of the talks with the province of Quebec on the establishment of the enriched uranium plant. Has Quebec given up this file or its responsibilities to the government, or has the minister recently met with the minister responsible in Quebec to reach a conclusion?


Alastair William Gillespie: Mr. Speaker, there have been a number of conversations between officials of my department and Quebec government officials. I think the arrangement which has been worked out is that the Quebec government will proceed with its own particular feasibility or pre-feasibility study. For our part we will be undertaking a particular study dealing with economics and other factors which come into play for that major proposed project.


Roch La Salle: Mr. Speaker, a supplementary question.
Last week, Mr. Villeneuve, Hydro Quebec's representative and director of transportation, said before Mr. Farmer, a spokesman for the National Energy Board of the federal government, that Ottawa could force Hydro Quebec to sell its power. He also said that a request made fifteen months ago by Hydro Quebec is still pending before the National Energy Board. Can the minister tell the House if Ottawa proposes to force Quebec to increase its rates? Also, can he say whether Quebec will soon get an answer?


Alastair William Gillespie: Mr. Speaker, we are not interested in forcing anyone to do anything.



OLYMPIC GAMES


Mr. Otto Jelinek (High Park-Humber Valley):: Mr. Speaker, my question is supplementary to an earlier question asked of the Prime Minister about the Olympics. I was pleased to note, from the Prime Minister's answers to earlier questions, his interest in the Olympics now, which seems to be in contrast with the time he emphatically stated that the federal government would not pay one cent toward the games.
In view of the many difficulties and irregularities in the letting of contracts, security and other problems as well as the continual increase in the cost, which is expected now to reach $1 billion, notwithstanding over $200 million in direct grants by the federal government, would the Prime Minister be prepared to have the government initiate a detailed investigation into the letting of contracts, rising costs and all of the other problems in order to try to at least curb this runaway situation, and could he make a report available to the House?


Pierre Elliott Trudeau: Mr. Speaker, I am sure it was not intentional, but the hon. member just misled the House by saying that I had said the government would not pay a single cent. As a matter of fact, in my initial statement in parliament when I responded to the request of Mayor Drapeau and COJO, I made it quite clear that we would not pick up deficits, and so on, but that we would pay certain costs which result from federal participation. I mentioned specifically CBC, police, army, diplomatic services and so on, so the hon. member should not try to convey the impression that I am changing our position. It is the same position it was initially.
If the hon. member is suggesting that we step in to try to control and be prepared to pay part of the deficit, I am sure there are many Canadians who would support him, but I wish he would make his position clear.


Some hon. Members:: Hear, hear!


Otto John Jelinek: Before I come to my supplementary I should like to clarify my suggestion. I was not trying to mislead the House, but I was under the impression that before the original Olympic bill came before the House the Prime Minister was quoted as saying that.


Some hon. Members:: Oh, oh!


Otto John Jelinek: My supplementary is actually the same question. Because of all the problems Montreal and COJO are experiencing, I ask the Prime Minister whether he would be prepared to initiate an investigation in order to help them out and in order to curb the runaway problems which Montreal and COJO are experiencing.
October 30, 1975


Pierre Elliott Trudeau: That is really part of the same question the hon. member asked previously, but I put it to him that if we want to investigate and control costs, supervise the contracts and sign them ourselves, the hon. member is really suggesting that we do share part of the responsibility for the deficit. If this is his position, he should state it clearly on behalf of his party, and we will consider it.


Some hon. Members:: Hear, hear!



TRANSPORT


Mr. J. M. Forrestall (Dartmouth-Halifax East):: Mr. Speaker, I have another question for the Minister of Transport. What action does the government propose to take with respect to the additional 10 per cent plus 5 per cent increases in freight rates for containers moving out of the port of Halifax into central Canada? These increases come into effect very shortly and will bring to a total of 73 per cent the increases in freight rates in the last five or six years for that particular item.


Otto Emil Lang: Mr. Speaker, as indicated in the House in answer to earlier questions, all proposed freight rate increases will now have to be tested against the guidelines. There are some complicated questions involved in determining the application of those guidelines to such complex matters as freight rates, and we are looking into the question of the exact nature of those guidelines now.


J. Michael Forrestall: I wonder if I can assume from the welcome response of the minister that some action will be taken to defer or delay the implementation of further freight rate increases in instances such as this until such time as the review board has procedures in place to deal with them and to consider them properly.


Otto Emil Lang: Mr. Speaker, I would not want to forecast the specific details until I am rather more sure about the nature of the application of the guidelines to freight increases.



ROUTINE PROCEEDINGS


Gerald William Baldwin: On a point of order, Mr. Speaker, I should like to ask the government House leader about the business for the rest of this week and next week. I watched him counting on his fingers the number of shopping days to Christmas, so perhaps he will tell us what he dreams of
Business of the House
finding hung on his legislative Christmas tree on, say, December 19.


Mr. Sharp:: Mr. Speaker, as the House leader for the official opposition has indicated, the House leaders have had some discussion about the program of measures the government would like to have dealt with by the House before Christmas. There is universal, enthusiastic support for a fixed day for the beginning of the Christmas break, which we all agree should be, if possible, December 19. In order to realize these various objectives, it will be necessary to manage the time devoted to the various measures before us and, particularly, to move bills into standing committees as expeditiously as possible.
With that in mind, I am announcing a program which the House leaders believe is manageable, and would not unduly restrain debate on any particular measure, for the period Friday, October 31, to Friday, November 7, inclusive. This program would cover the following items: second reading of bills C-28, C-21 and S-10; the remaining stages of Bill C-25; second reading of Bill C-69; second reading of Bill C-65 and its consideration in committee of the whole; second reading of Bill C-52.
Hon. members will note that this package of measures includes some that might be called housekeeping items which are not likely to involve much by way of debate, some relatively non-contentious bills, and the conclusion of the second reading debate on Bill C-69 relative to unemployment insurance. The intention is that debate on second reading of Bill C-69 will resume on Monday, November 3. There has been agreement among House leaders that in order to have some prospect of reaching our objectives, we should agree now to reduce somewhat the time limitation on speeches upon resumption of second reading.
I therefore move, seconded by the hon. member for Peace River (Mr. Baldwin):
That when the House resumes consideration of the second reading stage of Government Order No. 69, an act to amend the Unemployment Insurance Act, 1971, all speeches be limited to 30 minutes during the debate on second reading.


Mr. Speaker:: Order, please. If I am not mistaken, the motion refers to Government Order No. 69. In fact, it also refers to Bill C-69. I do not know whether there is some confusion. The House has heard the terms of the motion. Is it the pleasure of the House to adopt this motion?


[Stage Direction]
Motion agreed to.
Gerald William Baldwin: Mr. Speaker, while we are all getting along so famously, I wonder if the minister could clarify the government's intention with regard to November 10, respecting which there was a measure of agreement, so that the House can make certain that this will be a fait accompli?


Mitchell William Sharp: Mr. Speaker, as I said in the House one day last week, there is a general desire that the House should not sit on November 10, this being the day before one of the legal holidays. That has been agreed, and I intend to bring forward an order to add some time to government days in order to make up for the time lost. I did make another suggestion to the House leader of the official opposition, but I hesitate to mention it in case he turns it down.

October 30, 1975
Order Paper Questions


Stanley Howard Knowles: Mr. Speaker, as will be clear, we have agreed to certain matters which have already been mentioned. However, may I ask the government House Leader my weekly question about two pieces of legislation? I realize that in the discussions yesterday, reference was made to the bill to amend the Government Annuities Act. Can we be assured that that bill will be before us in time for it to be dealt with before Christmas? Also, can the minister say whether the bill based on the report of the Standing Committee on Veterans Affairs regarding Canadian veterans who were prisoners of war will be before us so that we can get it passed before Christmas?


Mitchell William Sharp: Mr. Speaker, in cabinet today we dealt with both of those measures. We agreed on the terms of the bill to amend the Government Annuities Act and it will come forward in the next few days. We also discussed the terms of the other bill but did not reach a final conclusion, although things are moving.


IMMIGRATION POLICY
[Stage Direction]
Hon. Martin O'Connell (Scarborough East) presented the second report of the Special Joint Committee on Immigration Policy, and moved that the report be concurred in.
Motion agreed to.

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Maurice Foster (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, the following questions will be answered today: 2,307, 2,308, 2,309, 2,310, 2,311, 2,312, 3,105 and 3,131. I ask, Mr. Speaker, that the remaining questions be allowed to stand.


Mr. Cossitt: With reference to the answer to Question No. 1,352 stating in part that a 20" Electrohome colour television at $579.95 and a Zenith 20" Colour television at $650 were purchased for the Prime Minister's residence at 24 Sussex Drive (a) on what date and from whom were such items purchased (b) on what other occasions since April 20, 1968 have television sets been purchased at public expense for 24 Sussex Drive and what is the item and cost in each case?


Mitchell William Sharp: I am informed by the Department of Public Works and the Prime Minister's Office as follows: (a) The television sets referred to in question No. 1352 were bought at Consum-

er's Television Service Limited, 685 Bank Street, Ottawa, on August 29, 1973 and Federal Electronics Registered, 57 Beechwood, Ottawa, on September 9, 1974 for $650.00 and $579.95 respectively, (b) None.


Mr. Cossitt: With reference to the answer to Question No. 1,352 stating in part that an antique French directoral bergere was purchased at a cost of $1,100 for the Prime Minister's residence at 24 Sussex Drive (a) on what date and from whom was such purchase made (b) who are all the persons choosing and recommending such purchase (c) were any designers, interior decorators involved and, if so, what are their identities and what fees did they receive?


Mitchell William Sharp: I am informed by the Department of Public Works and the Prime Minister's Office as follows: (a) The purchase was made from Antiquites Crescent Antiques Inc., 2137 Crescent Street, Montreal 107, Quebec, on July 12, 1973. (b) See reply to question No. 28. (c) No.


Mr. Cossitt: With reference to the answer to Question No. 1,352 stating in part that two Elda chairs were purchased at a cost of $2,052 for the Prime Minister's residence at 24 Sussex Drive (a) on what date and from whom was such purchase made (b) who are all the persons choosing and recommending such purchase (c) were any designers, interior decorators involved and, if so, what are their identities and what fees did they receive?


Mitchell William Sharp: I am informed by the Department of Public Works and the Prime Minister's Office as follows: (a) The purchase was made from Gemini Furniture Sales Limited, 29-1 Connell Court, Toronto, Ontario, on November 15, 1973. (b) See reply to question No. 28. (c) No.


Mr. Cossitt: With reference to the answer to Question No. 1,352 stating in part that an antique Georgian chandelier circa 1790 was purchased at a cost of $3,000 for the Prime Minister's residence at 24 Sussex Drive (a) on what date and from whom was such purchase made (b) who are all the persons choosing and recommending such purchase (c) were any designers, interior decorators involved and, if so, what are their identities and what fees did they receive?


Mitchell William Sharp: I am informed by the Department of Public Works and the Prime Minister's Office as follows: (a) The purchase was made from the Paisley Shop Limited Antiques, 889 Yonge Street, Toronto, on November 14, 1973. (b) See reply to question No. 28. (c) No.


Mr. Cossitt: With reference to the answer to Question No. 1,352 stating in part that two antique French armchairs circa 1830 were purchased at a cost of $1,251 for the Prime Minister's residence at 24 Sussex Drive (a) on what date and from whom was such purchase made (b) who are all the persons choosing and recommending such purchase (c) were any designers, interior decorators involved and, if so, what are their identities and what fees did they receive?
October 30, 1975


Mitchell William Sharp: I am informed by the Department of Public Works and the Prime Minister's Office as follows: (a) The purchase was made from Antiquites Crescent Antiques Inc., 2137 Crescent Street, Montreal 107, Quebec on July 12, 1973. (b) See reply to question No. 28. (c) No.


Mr. Cossitt: With reference to the answer to Question No. 1,352 stating in part that an antique French bergere circa 1820 was purchased at a cost of $950 for the Prime Minister's residence at 24 Sussex Drive (a) on what date and from whom was such purchase made (b) who are all the persons choosing and recommending such purchase (c) were any designers, interior decorators involved and, if so, what are their identities and what fees did they receive?


Mitchell William Sharp: I am informed by the Department of Public Works and the Prime Minister's Office as follows: (a) The purchase was made from Antiquites Crescent Antiques Inc., 2137 Crescent Street, Montreal 107, Quebec on July 12, 1973. (b) See reply to question No. 28. (c) No.
MANPOWER AND IMMIGRATION PUBLICATION-M & I NEWS


Mr. Epp: 1.	What is the yearly budget for the Department of Manpower and Immigration publication M & I News?
2.	What was the cost for June 1975?
3.	Is the publication printed by (a) government facilities (b) private printers and, if so, what is the name of the printer?
4.	Were tenders called for the printing of the publication?


Robert Knight Andras: 1. Budget for 1975-76-$28,000.
2.	Cost for printing June, 1975-$7,644.15.
3.	(a) No. (b) Yes, Mutual Press Ltd., 1424 Michael St. Ottawa.
4.	Yes, tenders were called and contract awarded bv D.S.S.


Mr. Beatty: 1.	Did any reporters invited to attend the press activities for the opening of Mirabel Airport have their (a) transportation (b) accommodation paid for by the government and, if so (i) how many (ii) what was the cost to the taxpayer for each activity?
2.	What was the cost to the taxpayer for (a) liquor (b) food supplied for the use of reporters and government officials involved with the press activities?
3.	(a) What other categories of persons except government employees had either their transportation or accommodation paid for by the taxpayer (b) what was the total cost to the taxpayer for each category?
4.	What was the total cost to the taxpayer for the provision of (a) liquor (b) food for all of the activities commemorating Mirabel's opening?


Otto Emil Lang: 1. (a) No.
(b) No.
2. (a) $3,306.78. (b) $6,075.
Order Paper Questions
3.	(a) Nineteen foreign ministers responsible for Civil Aviation including wives and one assistant. The Canadian government is paying the cost of accommodation but not transportation, (b) Total cost $12,179.
4.	(a) $20,250. (b) $48,840.96.


Thomas Charles Cossitt: Mr. Speaker, I rise on a point of order. The other day, in the absence of the Prime Minister, I raised a point of order concerning the answer given to question No. 1,233. Now that the Prime Minister is back in the House, I should like to raise it again because I feel it is quite appropriate. The question concerns the swimming pool at 24 Sussex Drive and the fact that certain questions, particularly No. 1,233, have been answered with non-answers. I ask the Prime Minister, on this point of order, if he can now assure the House beyond any doubt that there is no impropriety, no conflict of interest or anything existing in regard to the swimming pool at 24 Sussex Drive?


Mr. Speaker:: Order, please. As the hon. member may know, he probably does not have a valid point of order; and even if he does, it does not permit him to ask questions beyond the question period.



GOVERNMENT ORDERS


Hon. Robert L. Stanfield (Leader of the Opposition) moved:: That in the view of this House, the government should set an example to other Canadians by forthwith indicating the nature and extent of the restraints on government spending and should also introduce without further delay measures to implement the Wilson report on the office of the Auditor General as an indication of its willingness to eliminate waste and extravagance.
He said: Madam Speaker, in this motion put forward by my party today we are asking the government to set an example for Canadians in the matter of restraints. The government should also take specific action in relation to the office of the Auditor General. During most of my remarks I intend to deal with the restraint aspect of the motion, under two headings. Others will deal specifically with the office of the Auditor General and recommendations will be made in that regard.
As I say, it is of great importance to the country that the government itself set an example to the people, in two ways. First, there must be real restraint. Here there is no room for new tricks with mirrors, or old juggling acts. Second, the public must perceive that the government has changed its own style of living, really believes in modesty of operation and is committed to it as a long-term way of life. So far, in the flurry and confusion of the first 17 days of the new renaissance, I have not seen examples of the government's determination to proceed on either of those

October 30, 1975
Government Spending
necessary courses, let alone on both. The government seems to be in the middle of the ocean and trying to build a boat at the same time. It seems to be so preoccupied with its dilemma that it has not got around to charting any evident course.
Speaking on my first point, that of the government setting an example by real restraint, let me make it clear at the outset that I am not simply talking about amounts being spent. Much of the problem created by the government results from the way in which money is spent. I think this area is a prime target if any attempt at restraint is intended to be meaningful. The government, clearly, has a record-and therefore a reputation-of getting little bang for the taxpayers' buck. Money somehow gets thrown around inefficiently and ineffectively. This is very evident in relation to DREE programs. This fact has always caused me a great deal of concern.


Mr. Chretien:: Tell us where you would make cuts.


Robert Lorne Stanfield: Madam Speaker, if the minister will bear with me, we shall try to set him straight.


Joseph Jacques Jean Chrétien: I want to set the tone of the debate.


Robert Lorne Stanfield: The minister says he wants to set the tone.


Joseph Jacques Jean Chrétien: Tell us where you would make cuts.


Robert Lorne Stanfield: I want to talk for a moment about DREE, as large-scale funds are devoted to DREE programs. In all the years this government has tried to tackle the problem of regional disparity, it has never given us any coherent or consistent plan. There has not been any coherent plan within DREE itself. For example, DREE programs have not been co-ordinated with transportation policies. Frequently, one or several ministries of government do things which run counter to the purposes of DREE. That this is so is evident from the fiscal and monetary policies and programs this government has adopted from time to time.
I have always been concerned that the lack of effectiveness of DREE expenditures would weaken the willingness of those in the more prosperous parts of the country to continue supporting the high level of contributions being made to this kind of program. I became very concerned a few years ago when a minister formerly in charge of DREE said in the House that DREE could be defended as successful because the gap between the maritimes and Ontario had been narrowed-narrowed because the maritimes were still as they had been, in absolute terms, but the economy of Ontario had been depressed by the federal government's economic slowdown of 1969 and 1970.


Some hon. Members:: Oh, oh!


Robert Lorne Stanfield: I do not want to see the fight against regional disparity lessened one whit, but I do not want to see things go on as stupidly as they have. Particularly, I do not want to hear again any defence of DREE similar to defences made in the past. I believe we can put up a much better fight against regional disparity and get far better results from the proportion of the national pie we have devoted to programs like those of DREE. I want to see some examples of that, Madam Speaker, as I know it can
(Mr. Stanfield.]
be done. With regard to the impact of government activities, the white paper stated:
The government will ask each of its departments or agencies to assess the probable impact of their policies and programs on both short-term and long-term price trends.
It went on to say:
The government intends to reassess the costs to the private sector of many government rules and regulations in the context of their benefits to society at large.
On reading those statements, I must say that at first glance I was struck by the fact that the government was again handing out my cigars. In the 1974 campaign, the Progressive Conservative party, as part of our economic stabilization program, said that in government it would subject all programs to an inflation impact test. We also said we wanted to cut away a good deal of bureaucratic underbrush because realities required nothing less. While I am encouraged to see these words in the white paper, I am not at all sure that these promises are serious. I have good reason for doubt. This government, for example, still refuses-I want the President of the Treasury Board (Mr. Chretien) to listen carefully-to submit the unemployment insurance program to any kind of independent inquiry.


Joseph Jacques Jean Chrétien: We have submitted it to the House.


Robert Lorne Stanfield: The minister says that the matter was submitted to the House. The government knows full well that the legislation presently before the House does not address itself in any fundamental way to the concerns about this program in terms of cost and productivity in the economy. I ask the President of the Treasury Board why a program which parliament was told would cost $20 per capita annually for unemployment insurance, when unemployment was assumed to be at 6.5 per cent per annum, a few short years later costs $200 per capita annually.


Gerald William Baldwin: Shocking!


Robert Lorne Stanfield: Why have we gone, in a few short years, from a cost figure of $20 per capita to one of $200 per capita, a figure ten times greater? That question, I think, must be answered. An independent inquiry is obviously the most honest and satisfactory way of getting an answer. We put forward proposals which would have resulted in significant economies, but these are no substitute for an independent inquiry and will not tell us why a program we were told would cost Canadians $20 per capita is now costing $200 per capita.
I want to make it clear that when I talk about an inquiry, I have no intention of implying a witch-hunt or simply a crackdown on abuses. Some administrative tightening up has already taken place, but more can be done along those lines. Leaving aside administration and control of abuses, I want to see an inquiry into unemployment insurance programs which will really get to the roots of the program and come up with concrete answers to a number of basic questions. One is, why is the program costing Canadians $200 per capita per annum when we had been assured that it would cost about $20 per capita? We have been seeking such an inquiry for more than two years. If the inquiry had been started when we wanted it, it would have been completed by now.
October 30, 1975


Walter David Baker: And the government would not be in office.


Robert Lorne Stanfield: We are talking in terms of billions of dollars. Think of the pressure put on the individual working Canadian by rising prices, unemployment insurance payments and taxes of all sorts. When the government puts a control program before the Canadian people, asking them to accept certain restraints with regard to remuneration, wages and salaries, I have to ask whether the government is prepared to commit itself not to take more of the people's incomes through such period of restraint.
We see the weasel statement in the white paper in which the government says it recognizes the importance of having its expenditures follow the same trend as the gross national product-a statement that does not mean anything at all. When the Canadian people are being asked to adopt a program of restraint for a period of perhaps three, four or more years, they are entitled to some pretty firm statements from the government as to how restrained it is prepared to be in putting its hands into their pockets to take away even more of their restricted earnings. You have to think of the sacrifice being asked of the individual arising out of the policy the government has announced. How can so much be asked, on the one hand, and so little answered on the other?


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: That is no recipe for stimulating co-operation and support for the program. It is a recipe for inciting resistance, exactly the opposite of what is required. The only example of any substantial or significant effort by the government to impose restraint is in connection with the health care program, where the government has decided, unilaterally,to place a ceiling on its expenditures, passing the buck to the provinces rather than making any real effort to achieve control within the program. It is a unilateral solution being imposed upon the provinces.
On the matter of creating public perception that restraint is a sincere intention of the government, the going will be very tough. Anyone with a vivid memory of Liberal television advertising during the 1974 election campaign might be inclined to say that the ghosts of all those gassed chickens have come home to roost.


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: The Prime Minister (Mr. Trudeau) now tosses out phrases like "living beyond our means" as he lectures, threatens and exhorts his way around the country. That is interesting. It is most interesting that he neglects to mention that before his administration took office, Canadians generally relied on the federal government to tell them what were their means. The Prime Minister talks about people demanding services from government, and in the same breath he talks about leadership. In 1974 he made $4 billion to $5 billion worth of promises, all the while talking about leadership. In 1972 he talked about goodies and candy.
His government has changed the whole nature of responsibility in administering the means of Canadians. It
Government Spending
has betrayed the essence of federal economic leadership: it has almost made the word itself meaningless. What the government is doing now is not providing leadership; it is purely and simply a case of reaction in desperation. Whether the desperation was more keenly felt about the nation's economy, or about some vote that might take place at a Liberal convention, I do not know.


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: That is an example of how little stock I am prepared to put in the sincerity of their actions. What are these means within which we should be prepared to live? The government will not even tell the House and the country the current state of the country's deficit. I say it will not tell us because I am not prepared to believe that it cannot tell us. When I was involved in provincial government I had nowhere near the sophisticated apparatus available to me that this government has, but I always had a ballpark fix on what the years' financial results were going to be. Therefore, no one opposite can pretend they do not know the latest forecast of the budget deficit.
How is anyone going to trust a government which, in today's circumstances, will not tell us how far it is extended beyond its own means but says, "You must learn to live within your means", when its means are only provided through our means in the first place? There are reports that the deficit for the current fiscal year will be $7 billion or more. We cannot get any response from the minister. There are also reports, which seem to be well founded, that the deficit for the next fiscal year will be substantially larger than that.
People living in New York city at least know what they are up against. At this moment, Canadians are not even being given a clue. They are threatened by the government. They are told to live within their means or court being subjected to a further terrible economic thumbscrew. They are told this by a government which takes their tax money today and says it will given an accounting later, a government that asks them to adopt a program today and says they will tell the story later. This attitude, in itself, makes a farce of the Prime Minister's admonitions about changing attitudes. The Prime Minister gives the impression that it really does not matter much to him whether he has a government in a permissive society or an authoritarian society. Whatever became of the just society seems to be just an academic question today.
This perception has to be changed and it will only be changed by changing the reality of the situation. The government has finally admitted that the problem of inflationary expectations in Canada is self-feeding. It has finally abandoned the myth that our problem is largely international and, therefore, beyond our control. Having taken that giant step into reality, after two years of denying the evidence and the indicators, it has to go all the way if it wants to be believed. The truth extended only up to a point just will not do. The whole truth, and nothing but the truth, must be added as requirements for credibility. These people have said so many things which have devalued the currency of their credibility that they cannot afford to be less than frank today. There certainly must be no restraint on the truth.

October 30, 1975
Government Spending
When the Prime Minister talks about the revolution of rising expectations he should, with equal candour, be prepared to talk about the revolution of diminishing credibility which his party and his administration have brought about in relation to parliament, to government and to the process of politics generally. The reversals, U-turns and flip-flops which have been exhibited to Canadians by the present government are beyond redemption through the art of alibi. This is what the Minister of Finance (Mr. Macdonald) said in his Rosedale victory celebration on July 8, 1974:
Leadership was the issue in this election ... Inflation was a great concern but this was not a vote for or against inflation. Everybody's against inflation. It was a vote against direct controls. The voters rejected wage controls and the notion that government spending was responsible for inflation at this time, which I have to regard as a sensible judgement.
I suppose the Minister of Finance believed in what he said at that time. I don't know what he believes in today. Along with the Prime Minister and the other ministers of the government, he is trying to tell us that times have changed: yesterday's white is today's black; yesterday's thorn is today a rose. They spent years of their careers in the cabinet accusing my party and myself of being prophets of doom and gloom. Madam Speaker, it is now clear that we were not false prophets. The false prophets were those with positions of leadership within the government and within the Liberal party.


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: They should have known better and they should have behaved better. But they chose the primrose path. They chose expediency over responsibility. They chose excess instead of sufficiency as a hallmark of their trappings of office. I get the feeling that many of them are numbed, now, by the realization of where this has led the country and the mood of the country. But shock by itself is not repentance, and retrenchment is not restraint. They talk about changing attitudes in the country. Let them confess who made a major contribution to breeding those attitudes they now want to change. Sackcloth has no credibility in its own right; and it certainly has no meaning at all when it cloaks a creature with a forked tongue.
Let somebody in the government have the courage to say that its laissez-faire approach to spending money on frills and peacockery was a mistake. Office renovations alone have put the government in a position where the public knows that many ministers and officials are going to tough out this war on inflation in pretty sumptuous bunkers.


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: Those who are on the firing line, those who are urged to accept restraints which are not very pleasant to bear, are not going to be impressed by chocolate soldiers. Everywhere a Canadian looks, he sees things like the lavish reception at Mirabel. There are those on the other side who will say these things do not really mean very much, that they represent only a very small fraction of total government expenditure. Mr. Speaker, it is exactly that kind of thinking which is ruining the government's credibility and makes it appear unworthy of trust. Unhap-

pily, it is the kind of thinking which appears to prevail among members of the government today.
In closing, I say there are great areas of government expenditure which need looking into. I mention the unemployment insurance fund particularly, where costs are now running at $200 per capita instead of $20 per capita as they were supposed to be. In many respects, the signs of lavishness are perhaps more important, in terms of the public acceptance of restraint, than reasonable expenditures on larger programs. With so many examples of government spending on luxuries rather than on good, plain fare, how can hon. gentlemen opposite seriously expect the public to accept restraint? How can the government seriously expect the public to take it seriously?


Some hon. Members:: Hear, hear!


Joseph Jacques Jean Chrétien: Madam Speaker, it is Thursday today, yet as I listened to that demonical sermon by the Leader of the Opposition (Mr. Stanfield) I had the feeling it must be Sunday. It is difficult for me to get up and defend the government-


Some hon. Members:: Hear, hear!


Joseph Jacques Jean Chrétien: -at this point because yesterday, when I was replying to a question, the same man who was talking about the virtue of not spending shouted across the floor to me, calling me Scrooge because I was not spending enough.


Robert Lorne Stanfield: No.


Joseph Jacques Jean Chrétien: When I hear these sanctimonious sermons in the House I am simply amazed. The other day we sat here minute after minute waiting to hear their proposals for reducing expenditure. All we heard was a lot of hot air. The hon. gentleman mentioned the reception at Mirabel. Let me remind him that we are dealing with a budget of $34 billion. Perhaps we did spend a little too much on the opening of Mirabel.
What else has been referred to? The only other matter concerned unemployment insurance. Well, there was a debate on this very subject in the House yesterday. At the end of that debate the bill will be sent to committee for full examination. Yet the opposition is still asking for an inquiry. Madam Speaker, if members of the opposition have an accusation to make, let them get up in the House and make it. Let them go before the committee and show where money is being wasted on the government's unemployment insurance program. It is useless simply to make general statements of the kind they are making.
The other day in the House the hon. member for Joliette (Mr. La Salle) asked me to put more money into the LIP program. A little later he made the same request of the Minister of Manpower and Immigration (Mr. Andras). Within half an hour the hon. member for Athabasca (Mr. Yewchuk) got up and said we should cut the LIP program.
I suggest hon. members opposite should get together in caucus before making statements like that in the House. Today they are asking us to reduce expenditures. Look at Hansard. The hon. member for Vegreville (Mr. Mazankow-ski) was on his feet on October 21 asking the government to spend more money on the cow-calf operation.
October 30, 1975


Mr. Mazankowski:: Simply because your own minister said he would do it.


Joseph Jacques Jean Chrétien: He called for more money for that operation. Then on the same day, October 21, the hon. member for Joliette asked for more money for the LIP program.


Roch La Salle: Depensez l'argent a la bonne place.


Joseph Jacques Jean Chrétien: Don't try and say things out of both sides of your mouth. According to the speech of the Leader of the Opposition, we are spending too much. I do not say that; I am quoting the official opposition. I do not know whether he is wrong or right. I am trying to illustrate the unity of this party on major policy. In the first allotted day that they have in this House, the opposition members are asking us to cut expenditures.


Donald Frank Mazankowski: Tell us about Mirabel and the 20,000 bucks spent on booze.


Joseph Jacques Jean Chrétien: The hon. member for Parry Sound-Mus-koka (Mr. Darling) wanted the government to extend the French program for a longer period. I do not say he is wrong, but he should have talked to his leader before his leader made his speech. The hon. member for Provencher (Mr. Epp)-I do not know which party he belongs to- wants us to put more money into research programs for agriculture. That would not be cutting expenditure,
As for the party at Mirabel, another nice gentleman got up on his feet the other day and talked about that. The hon. member for Humber-St. George's-St. Barbe (Mr. Marshall) suggested an amendment to increase expenditure in the fisheries department to cover fishermen. I do not say he is right or wrong; I am just telling him to ask his leader what he thinks about that before asking the question. I have with me a pile of questions which are asked in this House by hon. members opposite every day. The Leader of the Opposition wanted an inquiry into the unemployment insurance program. He should go to the committee and ask that question.


J. Michael Forrestall: Go to the committee? Be credible.


Joseph Jacques Jean Chrétien: When we did not have a committee, hon. members were complaining because we did not provide them with the information on which to ask questions. The officials are there, and hon. members can have the director of the program there to answer questions.


Mr. Woolliams:: I have never heard such nonsense in mv life.


Joseph Jacques Jean Chrétien: You are referring to the speech that your leader made a few minutes ago, are you?


The Acting Speaker (Mrs. Morin):: Order. I must remind hon. members at this time that they are supposed to address the Chair, not each other across the aisle.


Mr. Yewchuk:: Say something positive.


Joseph Jacques Jean Chrétien: The Leader of the Opposition made a general accusation today. I expected him to be precise. He said he was not asking the government to cut the DREE
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program, but he was asking that it be made more efficient. There is, of course, room for more efficiency in many areas; I do not deny that. But he did not suggest that we cut one cent from the program. Out of the $34 billion budget of the government, not one item was identified by the Leader of the Opposition apart from the party that was held at Mirabel two weeks ago, which I could not attend anyway, so I did not benefit from it. Hon. members should be more precise. In the budget last June-


Mr. Fairweather:: Whose budget was that, and where is he?


Joseph Jacques Jean Chrétien: The hon. gentleman was here a minute ago.


Gerald William Baldwin: Now you see him, now you don't.


Joseph Jacques Jean Chrétien: We have proposed a series of cuts amounting to $967 million.


Gerald William Baldwin: Nonsense.


Joseph Jacques Jean Chrétien: It is not nonsense. I can go through each department that has had to make cuts. I have received representations from members on the other side of the House asking me to make more money available for the small craft harbours program. Some members of the opposition asked me not to cut that program. We have made cuts in agriculture and in communications. If hon. members have not read this list that has been published, I could table it. It would take me five minutes to read it. They make statements dealing in generalities, without being specific on anything. They do not have the guts to be specific.
The hon. member for Winnipeg North Centre (Mr. Knowles) claims I am not spending enough and neither is the government. He is not asking us to make cuts. I do not like to hear the official opposition asking us today to cut expenditure, when in every question period that we have one of them gets up and asks us to spend a little more money here and a little more money there. They should be logical. As I say, we have cut $967 million from the budget brought down in June.


Mr. Crouse:: Be honest.


Joseph Jacques Jean Chrétien: That is the fact. I will table the list, if you have not read it; but hon. members opposite do not want it printed in Hansard. I can read all five pages of it, if you want me to do so.


Allan Joseph MacEachen: Read it through, Jean.


Joseph Jacques Jean Chrétien: These are the expenditure reductions. Department of Agriculture, Canadian Dairy Commission, $14 million; multipurpose exhibition facilities, $2.5 million; Farm Credit Corporation, $20 million; Department of Communications, professional and special services, $200,000; Canadian Overseas Telecommunication Corporation, $2.9 million; Department of Energy, Mines and Resources, energy, research and development-


J. Michael Forrestall: Come on, say something.

October 30, 1975
Government Spending


Joseph Jacques Jean Chrétien: I have 120, lines to go through, and I have only dealt with five.


Robert Gordon Lee Fairweather: That is all faked, and you know it.


Joseph Jacques Jean Chrétien: No, it is not. This is money that the department were going to spend but which we have now cut, so it is not faked.


Robert Gordon Lee Fairweather: That is part of your problem,
credibility.


Joseph Jacques Jean Chrétien: In 1973-74 and 1974-75 the increase in the civil service was, on average, 6 per cent to 7 per cent a year. In the blue book that I have tabled for this fiscal year I stated it would be reduced to 4.1 per cent. In the budget of the previous minister of finance he and I proposed to reduce it further, by 1 per cent to 3.1 per cent. In the program for next year we see the growth of the public service as 1.5 per cent over this year. Every department is affected. Hon. members should visit Treasury Board where every week departments are asking us for more money and more man-years.


J. Michael Forrestall: How big will the deficit be?


Joseph Jacques Jean Chrétien: When I tabled the estimates in January, I said that the increase in expenditure this year compared with the previous year would be less than 16 per cent. Many members on the other side said that in light of the history of the government, that was not possible. I am telling them today that not only will it be less than 16 per cent, but it will be less than 15 per cent next year. I have a list of all these government expenditures. In the budget, the previous minister of finance said that the cash requirements of the government would be around $35 billion, if I recall the figure correctly. That total remains unchanged. If the Minister of Finance (Mr. Macdonald) has some fresh announcement to make, then he will make it; but we are still sticking by the budget predictions of July.
The government is proposing $32.2 billion of expenditure. Legislation passed by this House of Commons accounts for 56 per cent of that total. Who is proposing that we do not pay old age security? Who is proposing that we do not pay the interest on the public debt? Who is proposing that we do not pay the provinces the fiscal transfer payments that the legislation of this House has guaranteed them? Who is proposing in this House that we do not pay family allowances? All these programs were voted for in this House; hon. members on all sides voted for them.


An hon. Member:: Who proposes to cut out medicare?


Joseph Jacques Jean Chrétien: Who proposes that this year we do not pay for hospital care? Who proposes that we do not pay unemployment insurance benefits? Who are those that propose we do not meet our medicare obligations?


An hon. Member:: You are.


Joseph Jacques Jean Chrétien: Who are those that do not agree we should pay Canada Assistance Plan benefits, post-secondary education assistance, military pensions, railway subsidies for the maintenance of branch lines, and so on? Who

is proposing that we cut all these? I would like those members to get up and say that these programs are the ones that are no damned good and we should cut them. In his speech, the Leader of the Opposition did not propose one thing that we should cut from the budget of $32 billion. The list I have just enumerated represents 56 per cent of the budget of the government.
We have certain contractual payments. Who is proposing that we do not pay for Manpower training programs in this land? Who does not want us to keep on paying $252 million for sewage treatment plants and public housing projects under CMHC? Who is proposing that we do not make fiscal transfer payments to the Yukon and the Northwest Territories? By the way, I am glad to see that the hon. member for Yukon (Mr. Nielsen) is back in the House. We were right in appointing a Liberal senator in order to bring him back to Ottawa, as we have not seen him for a long time. Who is proposing that we not pay public service employee fringe benefits to the extent of $95 million? Who is proposing that we cut legal aid grants to the provinces? This is another contractual payment. I would like hon. members to tell us which of these programs we should cut. Hon. members on the other side are silent. Get up and tell me which ones you want us to cut.


Mr. Howie:: I don't want you to cut any of them, but isn't your minister of health trying to cut back on medicare?


Joseph Jacques Jean Chrétien: No, I am talking about this fiscal year. Hon. members do not want to say. Let us go to another area.


Lloyd Roseville Crouse: Madam Speaker, I rise on a point of order. I must challenge the statement the minister has just made. Only last Thursday in this House, when speaking on Bill C-73-


An hon. Member:: What is the point of order?


Lloyd Roseville Crouse: If the hon. member over there will keep quiet for a moment I will explain the point of order. If he will be as patient with me as I am with him, I will outline the point. It is simply this: the minister has said that no one from this side of the House has at any time offered any suggestion in respect of cuts that would be reasonable and would not affect the lifestyle of Canadians. Last Thursday, when speaking on Bill C-73, as recorded at page 8491 of Hansard I made concrete suggestions in this House which would cut at least $500 million from the present budget. The minister has made no comment in respect of those suggestions. I ask him now if he will sincerely consider those proposals and, hopefully, take advantage of some of them.


The Acting Speaker (Mrs. Morin):: Order, please. This is clearly a matter of debate and not a point of order. The hon. member may wish to participate later in the debate.


Joseph Jacques Jean Chrétien: In reply to the hon. member, what he is referring to is the consultants' fees referred to in the book published by my department. He suggested the amount involved was $1 billion, but when I got to my feet I explained to him that there was an amount of $486 million included in that to cover Manpower training programs. I would ask hon. members whether we should cut that. I
October 30, 1975

have indicated, in respect of professional consultants being hired by the government, that I ordered a reduction this year of 10 per cent over what was predicted; and we have accomplished that.


Lloyd Roseville Crouse: Those are not the recommendations I made to you, sir.


Joseph Jacques Jean Chrétien: The hon. member asked me about consultants' fees and I said that, included in that item, were the Manpower training transfer payments to the provinces.


An hon. Member:: You are not listening.


Joseph Jacques Jean Chrétien: What about the payments made in respect of veterans' allowances amounting to $516 million? What about CIDA grants in the amount of $481 million? What about municipal grants in lieu of taxes, amounting to $76 million? What about grants to international organizations, in the amount of $36 million? We have to meet those contractual obligations, and no one is suggesting to us that we should not. I could carry on and on. For example, we are spending 8 per cent of the total budget of the government for national defence. I see the hon. member for Victoria (Mr. McKinnon) in his seat. I would like him to tell me if he would want us to cut the defence budget even more. He is the official critic of the opposition with respect to national defence. Should we cut the $2,432 billion we are spending for national defence?


Allan Bruce McKinnon: Madam Speaker, the minister has asked me a question and I should like to answer.


The Acting Speaker (Mrs. Morin):: Order, please. The hon. member will have an opportunity to participate when the minister has resumed his seat.


Allan Bruce McKinnon: He has asked me a question, Madam Speaker.


Joseph Jacques Jean Chrétien: I hope I will hear that the hon. member wants us to cut that expenditure.


Allan Bruce McKinnon: You could cut out the $11 million the department has paid two American companies for a study it does not intend to use.


An hon. Member:: That is $11 million; think about it.


Joseph Jacques Jean Chrétien: It is $11 million of a budget of $2,432 billion.


An hon. Member:: What's $11 million?


Joseph Jacques Jean Chrétien: I do not know about this case; I will investigate it. But the hon. member knows that is not hurting the real expenditures for national defence. This is the background on which we are working.
I would like hon. members to be precise about these so-called cuts to programs. They should stop speaking from both sides of their mouths. If they want us to make cuts, they should advise us where we should make them. We have to meet the budget. We get the funds, and we will defend our expenditures. I do not like this business of members of the official opposition and other opposition members asking for more money, then the Leader of the
Government Spending
Opposition asking us to cut expenditures, when the only precise thing he can refer to is the opening of the Mirabel airport at Montreal.


An hon. Member:: You have just heard two examples from two members.


Joseph Jacques Jean Chrétien: Hon. members are talking pure nonsense.
I would like them to be precise about these cuts, because people expect a better effort on the part of opposition members; they expect them to be more precise and to suggest more concrete things. At least the hon. member for Winnipeg South Centre (Mr. McKenzie) makes no bones about it; he wants us to put everything under government control, without any more room for private enterprise in the market place. That is his position. I do not agree with him, but at least he stands by his words and is not speaking from both sides of his mouth.


Mr. McKenzie:: I rise on a point of order, Madam Speaker. I never made any such statement. The minister referred to the hon. member for Winnipeg South Centre.


The Acting Speaker (Mrs. Morin):: Order, please. The hon. member is not in his seat.


Joseph Jacques Jean Chrétien: I am terriby sorry. I am sure you do not want to be referred to as that hon. member and I am sure he does not want to be referred to as you. I apologize.


Eldon Mattison Woolliams: I have to agree with that statement.


Joseph Jacques Jean Chrétien: I will make sure I do not refer to the hon. member for the other riding in Winnipeg. Madam Speaker, I should like to speak for a few minutes on the other aspect of the resolution. The Leader of the Opposition did not mention anything about it; he suggested that other members would refer to the Wilson commission. We received the report from that commission a few months ago. I am glad to report that we are on the verge of a final decision by cabinet in that regard. Some 95 per cent of the recommendations are absolutely acceptable to me and are likely to be acceptable to my colleagues in the cabinet. A final decision of the cabinet will be made within a few weeks. Following that, a bill will be drafted by the Department of Justice. The commission has worked very effectively in this area for many months and has made all sorts of very far reaching recommendations which have to be analysed by the government. These recommendations were presented to the House of Commons in the month of May.


Gerald William Baldwin: In April, if not in March. You got them in March and we got them in April.


Joseph Jacques Jean Chrétien: I do not have the precise date, but I will try to find it. It was quite late in the session. Both you and I are wrong on the date; it was actually April 14. The legislation will be available as soon as possible. I have had occasion to discuss some aspects of this report with the Auditor General and I am quite confident that when the whole process is completed the Auditor General will be satisfied with the bill I will introduce in this House. I said, when this report was tabled in April, that I hoped the government would be able to make up its mind before the end of the year. I am satisfied the government will have made a final decision by the end of the year and that long
8706

October 30, 1975
Government Spending
before that the bill will be ready for the House to study and make changes as need be.
Madam Speaker, I just want to reiterate the position of the government on expenditures. This year we have already cut $967 million in expenditures from the budget. These had been approved by the cabinet. The government has done this in order to make a contribution to the restraint program. We said, also, that for next year we will reduce to only 1.5 per cent the increase in the number of public servants to be hired by the government. We said that many of the other expenditures will be controlled. We said, for instance, that there will be no buying of new furniture for public servants next year and that there will be no buying of new automobiles. We also mentioned that there will be no first-class travel for public servants, and so on.
In response to the request of the Leader of the Opposition, these are some of the things we are doing. We are doing our utmost to make cuts. I wish the Leader of the Opposition would not pick out a single item such as one of the biggest airports in the world. I am disappointed that the Leader of the Opposition did not give us some very concrete suggestions about where cuts should be brought about, rather than referring to a point like that. [Translation]
Under these circumstances, Madam Speaker, it is quite easy to make a speech such as this. I thought the leader of the opposition would be a lot more specific and his colleagues would enlighten us about the truly outstanding areas where we might have set the example. At no time, however, have they come up with concrete propositions.
Perhaps it would be indicated for me at this time to recommend to the leader of the opposition to start having discussions with his rank and file, so that I may not have to note every day: some opposition members rose to ask the government for additional expenses. If they want us to spend more, let them say so, but let them refrain rising every other week to ask us to cut out government spending. There is not one day, Madam Speaker, where members of the opposition which I have begun to name, do not stand up to ask the government to spend considerable sums of money for projects that are important to them. I do not blame them for it; it is normal. But when they do so, they must bear in mind the implications of their demands. If we accept them, the government will have to increase its spending. If a member asks one day that the government increase its expenditures, he must not-if he is consistent-stand up the next day to ask to reduce them. Members should make up their minds. Then we could listen to them. But as long as they will keep putting such inconsistent requests, it will be difficult to do so. That is why, Madam Speaker, the Canadian people are not so eager to put them in power.


Robert Lorne Stanfield: I rise on a point of order, Madam Speaker, simply with regard to the minister's reference to my calling him a Scrooge. The minister disappointed me in this respect. I often criticize him, but I have always found him to be straightforward. He knows perfectly well that my reference to him as a Scrooge is a bit of a joke between
us, and, I am a little disappointed that he should try to convert that into a public argument.


The Acting Speaker (Mrs. Morin):: Order, please. The hon. member for Oshawa-Whitby (Mr. Broadbent).


John Edward Broadbent: Madam Speaker, I enjoyed most of the rhetorical outburst of the minister in his castigation of the official opposition for not presenting in detail any proposed budget cuts. If I listened accurately-I certainly listened with care-that was the gist of his speech. He made two points. I am sure he will correct me if I am wrong. One was that the official opposition did not document in any specific way its own general claim that there should be cutbacks. I am in agreement with that. In addition, he went on to suggest in some specific way what the government is doing. I shall deal, in the main body of my comments, with precisely what the government is and is not doing. He referred to the kind of cutbacks the government made in its last budget. In the course of my comments I will deal with parts of that budget and, specifically, the cutbacks in the medicare and hospitalization programs. I should like to hear the minister defend his position in this respect.
The second point is this. At no time since the recess, and nowhere in the white paper, has the government indicated it wants to cut back any specific program other than those mentioned last spring. My understanding is that proposals came forward to the minister from the Department of Finance-they subsequently went to the cabinet-concerning specific cutbacks in departments and areas. There was a suggestion that some things were not needed and they should be scrapped or modified. The fact is that the government has not announced, since we resumed this sitting this fall, any cutbacks in any programs. I think the minister will agree that, factually, this is the case.
In case the minister might turn to me and levy the same charge that he did to the Leader of the Opposition (Mr. Stanfield), I will make specific points about the kind of cuts we think should be made in government expenditures. In doing so, I say that we do not share the view that over-all cutbacks in the government sector alone are necessary in terms of dealing with the economy. However, there is no doubt that certain specific programs should be either entirely cut out or substantially reduced.
What are some of the things the New Democratic Party suggest? First of all, we oppose the hundreds of millions of dollars now being spent annually in consultants' fees for studies done by private individuals outside the government. It is almost impossible for an opposition party to see the internal operations of a department. However, I have no doubt that if the government were tough-minded about it, hundreds of millions of dollars could be saved partly, but not exclusively, by the Department of Urban Affairs. In some cases the work that is being done could be performed by public servants already on the payroll. We contend further efforts should be made to reduce the amount of money spent on outside consultants.


An hon. Member:: Mr. Blakeney could use that advice.


John Edward Broadbent: He not only uses it; he follows it. He has taken steps to do just that. The second point is that government outlay in respect of the salaries of senior civil

October 30, 1975

servants is wrong, in two respects: first, in terms of dollars spent and, second, in that it increases the gap between upper income and low income Canadians. This is bad in terms of fairness with relation to income distribution in Canada. In terms of net outlay, the minister would say that does not involve many millions of dollars and therefore does not directly-


Joseph Jacques Jean Chrétien: Oh, come on.


John Edward Broadbent: Never mind; I am dealing with the federal government.


Joseph Jacques Jean Chrétien: Oh, come on.


John Edward Broadbent: I took the argument of the minister seriously. I hope he takes mine seriously and does not go off at a tangent. I do not have to agree with everything our provincial governments do, nor do I expect the minister to do so, especially having regard to what provincial Liberal governments do.
Let us deal with the federal government. Apart from the unfairness of increasing the salaries of senior civil servants in the $50,000 and $60,000 range, which is bad in terms of distribution of income in Canada and its inflationary effect, it is much more serious because it sets the pattern for the whole economy. I am sure the minister is aware of that argument. In terms of its impact on the economy, it has been much more serious and negative than the inherent unfairness of giving an increasing amount of our total income to an increasingly smaller proportion of our population. It has a major inflationary effect on the private sector and provincial governments which have to increase the salaries of the top 10 per cent of their employees. For that, this government must be held responsible. We have opposed these vast increases for senior civil servants in terms of justice and in terms of the multiplier effect on the economy as a whole.
Third, we are, and have been, highly critical of what we have described as the alphabet soup type of programs designed to provide assistance to industry. The New Democratic Party, independent economists and, indeed, some of the commissions appointed by the government to conduct studies, have pointed out that approximately $250 million per year spent on programs such as DIP, IRDIA, PAIT, and so on, is money down the drain. If all of them were scrapped, it would have a positive effect on employment because there would be a more rational allocation of resources. We would scrap all those programs. We have provided a list before, and I would be glad to add to the few I have just mentioned for the benefit of the minister.


Joseph Jacques Jean Chrétien: Schreyer asks us for more money.


John Edward Broadbent: That is another point. If we were to talk about the need for national planning of the whole economy, the problems of Mr. Schreyer might be seen in a different context. However, I would like the minister to stay within the context of federal politics.


Some hon. Members:: Oh, oh!
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John Edward Broadbent: The fourth point I should like to make is that the millions of dollars the federal government has virtually given to the oil industry and the Syncrude project, both directly and by way of tax concessions, is not the kind of error, both in terms of spending and in terms of national economic independence, in which the New Democratic Party would have indulged.
Fifth, we would scrap entirely Information Canada, an agency we think is without justification. It duplicates the information services performed by information officers in virtually every government department. We would scrap that agency and save the taxpayers some money.
Sixth, both in the House and outside we have criticized the $250 million, approximately, which the federal government has poured into the aircraft industry in Montreal and Toronto in recent years.


Joseph Jacques Jean Chrétien: And Winnipeg.


John Edward Broadbent: The minister adds Winnipeg, and I agree. This money has been spent without producing a plan for rationalizing the aircraft industry in Canada. The government will probably embark upon a major blunder in the next few weeks by making a decision to produce fighter aircraft which will have absolutely nothing to do with a national plan developed for the aircraft industry. That $250 million has gone down the drain.
In short, we in this party are in favour of cutbacks in certain areas of government spending and, as I am doing now, we have in the past attempted in the House to suggest some examples. The minister did not deal with this issue in terms of the Canadian economy and I think it has been wrongly argued by the Conservatives, though I understand their argument. The real issue is not more, or less, government spending; it seems to me that the real issue we must face in a mixed economy is not government spending versus private spending, but where spending is going on in the economy, and with what net economic consequences.
To put money into shopping centres and into a whole range of private investment at a time of inflation is no more, or less, inflationary than government spending. So the whole issue of the control of spending, management and planning of spending in the economy is at stake here. It is a wrongly perceived view held by the Conservatives simply to concentrate on government spending; and, if I may say so, it is a wrong-headed defence by the government to reply to the general argument of the Conservatives without dealing with the much more serious and fundamental question of spending within the whole economy. What must be analysed and what we need from the government is a comprehensive approach to the spending of funds both in the private and public sector, and that is not what we have received from the government.
I come now to the statement of the minister about government spending. He says, with some pride, that in the white paper it says there is a ceiling being imposed across the board for next year in respect of federal government spending, although not on a selective basis. We reject that approach. We think it is wrong-headed because it cuts out or reduces good government programs, some of which should be extended instead of reduced or levelled out. It does not deal with the possibility of the need for total elimination of certain other programs. In other
29669-67Vi

October 30, 1975
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words, it is a cop-out. The minister accused the official opposition of not being specific in proposing programs. I now turn the argument back to the minister and say that his own approach for next year which sets a general level of cutback in terms of government spending is itself a cop-out which treats good government programs in the same way that it treats bad ones. In the opinion of the New Democratic Party, that is irresponsible.
If I read the message correctly, it means that programs with regard to health and welfare, family allowances, pensions, unemployment insurance, transfer payments and all spending in which the government is involved, will be affected. Those areas which I have just mentioned should not be included in the general cutback. In our view, the government is irresponsible in taking the position that for the coming year there has to be a general cutback.
Let me now deal with two specific areas in which the government indicated in its budget of last spring and in debates inside and outside the House so far this fall that it will cut back. I refer to hospitalization and medicare. We disagree with this. The government has told the provinces that specific ceilings will be set on the financing of medicare, and in the case of hospitalization it plans to phase out its contribution entirely. I cannot think of a worse approach to dealing with inflation than to take it out on the health of Canadians. That is the way I read that message. The government is indicating that it will cut back on medicare, and surely everyone in Canada would regard this as an essential human service. In an affluent society such as ours, to effect a cutback in an area of profound human need such as hospital and medical care is not only wrong in principle but is also false economy in many respects. Let me say what I mean by that. In some instances, increased expenditure in the medical field could lead to a long-range reduction in costs. It is shortsighted to argue that across the board cuts in medical expenditure will lead to long-range savings.
I give the province of Quebec credit for what it has done in the material field. In one sense it has led the country in the development of community clinics to head off medical problems. Surely from the point of view of costs, not to speak of humanity, that is a much better approach. Money spent on community clinics across the country would have long-range benefits which are obvious. In St. Gabriel de Brandon, for instance a community clinic discovered that children in the town kept getting a certain kind of skin infection or disease. They were "cured" time after time; then the cycle was repeated. Through the community clinic there was an investigation into the cause of the ailment and it was discovered that something in the water in which the children swam was responsible. The water was cleaned up and there was no repetition of the infection on the children in that area; consequently, the demand for medical services was lessened. That kind of community clinic which practises preventive medicine cuts down on long-range expenditure. The whole area of preventive medicine in Canada needs more, not less, money. Surely, when dealing with conditions in factories and mines it makes sense to head-off diseases like asbesto-sis and cancer. It makes more sense to spend money ahead
(Mr. Broadbent.]
of time rather than after men and women get the diseases, in many cases when no cure is possible.
Another example of sensible spending comes from the province of Saskatchewan. Instead of money going into elaborate hospitals, it has been found that a high percentage of cases can be adequately provided for in alternative facilities, thereby reducing the cost of treatment up to 200 per cent or 300 per cent, if not more. It makes sense both at the provincial and the federal level for government to spend more money creating alternatives to hospitalization. The long-range effect will be reduction of hospital and medical costs. It seems to me that the moral is obvious: in certain areas such as medicare we need more spending, not less.
Similarly, we need more, not less, government spending on housing. If there ever was a sector that could be singled out where government spending would be deflationary, it is the housing sector now. If the government had the guts to force banks to put up mortgage money at lower rates, and the political commitment to allocate funds to increase the supply of housing, there would be a substantial reduction in the cost of living. Increasing supply and reducing mortgage rates would have a positive effect for those who rent and those who want to buy accommodation.


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


Some hon. Members:: Continue.


The Acting Speaker (Mrs. Morin):: The time allotted to the hon. member can only be extended by unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


John Edward Broadbent: Thank you, Madam Speaker. Increased government spending on housing would provide a human necessity and jobs for many of the more than 700,000 Canadians presently unemployed. It would also have a deflationary effect on the economy. So the moral is more government spending in this sector, not less.
Before I conclude I should like to say that in terms of the over-all approach to the economy, I am apprehensive that the government is on the wrong course in its restrictive income and prices restraint program. Inside and outside this House, the Prime Minister (Mr. Trudeau) has said that we must live within our means; that is the phrase he has used. The fact is that we are not living up to our means. In the manufacturing sector alone we are operating at only about 85 per cent capacity. If the government really wants to come to grips with inflation, what we need is a program designed to stimulate increased production. We have unemployment and slackness in the economy, but that is not the source of the inflation. What we need is stimulation by the government. The government has not brought in any imaginative programs to show leadership in making the economy more productive.
The issue is not simply one of more, or less, government spending; the issue is one of over-all spending in the economy by both the private and the public sector. The government must assume a great deal of responsibility for making decisions in such spending for both the private
October 30, 1975

and the public sector. Many programs could be cut out, and I have listed them. Other government programs should have increased budgets. But over-all, this government should be concerned about getting rid of the slack in the economy so that we can have virtually full employment. In my view that, more than anything else, would eliminate inflation.


René Matte: Madam Speaker, I am very happy to speak to the motion of the Leader of the Opposition (Mr. Stanfield), all the more so that, to my mind, this motion really tests seriously the sincerity of the government with regard to its policy on price and wage freeze. Indeed, from the way the President of the Treasury Board (Mr. Chretien) replied to the speech of the leader of the opposition, we saw that he had little else to say but to try to deceive the House by refusing to make a distinction between waste and expenditures. The minister seems to assume that the two terms are synonymous. Spending is not necessarily being wasteful. I doubt that the leader of the opposition meant that no hon. member could ask or recommend that the government spend some moneys for the collective good.
Then, once again, I think it is my duty to point out that, if the government were expressing its view through the President of Treasury Board, it was completely beside the track because, Madam Speaker, even if one tried to ignore this squandering, one could not because it is too glaring. It would indeed be silly to deny it, that would mean contradicting the Auditor General himself, whose responsibility it is to keep a watchful eye, to study figures and tell us what is going on in the administrative circles of the country, what expenditures are excessive, which ones are downright wasteful, what were the oversights of the various government departments, and so forth. I do not intend to enumerate here all the facts that one can easily learn simply by reading the Auditor General's report.
Therefore, it is no use for the government to try to defend itself by accusing the opposition of pressing for increased expenditures, thereby hoping to conceal its own extravagance. If the government wishes to be honest and candid, it should tell the House which measures it intends to adopt to put an end to the squandering of public money, when this is the case, for it is very important to distinguish between wastefulness and legitimate expenditures. To cut down on expenses, just for the kick of it, or because it was proclaimed, might turn out to be a remedy worse than the evil, the effects of which might be worse than not interfering at all and letting things go as they are. Hence, the important point in my view is not so much to know what must be reduced and where but rather to ascertain which needs are real, essential and indispensable because we cannot tergiversate on this matter, Mr. Speaker. We cannot cut essential spending.
I think this distinction is absolutely necessary if we are to appraise adequately the value of the administrative policies the government may order. This is why, of course, I support such a motion. Well, it is easy to talk about the importance of government restraints but from the start the government should have told us how it wanted to apply these restraints, where they would be applied
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instead of sticking to generalities. Of course, I would not support any cut in expenditure relating to essential public needs. On the other hand, we would support cuts in useless spending. And here we would have liked to know how the government really wanted to apply these restraints to prevent the waisting denounced every year when nothing is done to remedy the situation.
A debate like today's shows, Mr. Speaker, how urgent it is to operate the required changes in our political views for, if there is any government spending, it is because the administration of the nation normally requires it. So there is no need to talk about cuts. If we do, it is because we admit that we indulge in wasteful spending. Of course, there is wasteful spending. May I point out one particular sector, which, I think, should cut its spending, that is the Department of National Defence.
I sincerely believe that a country such as ours needs a brave and alert army. I am not against it, it is a must but I think we do not need that much armament. In my opinion, we should have stopped long ago purchasing bombers, shells and all those devices which are never used and if, unfortunately, we ever had to use them, it would be because of a world catastrophy, when everyone here in Canada would be helpless.
Our geographical position between the world's two giants has been frequently mentioned and everyone knows that we will never compete with either the Soviets or the Americans.
Mr. Speaker, I would consider it a reasonable cut to drop from the national defence budget all expenditures relating to armament equipment for which we do not have much need. It is a justifiable cut, in my opinion.
And I should also take this opportunity to point out how a whole series of expenditures made by the government could be avoided if there were not a systematic tendency to set up in this country some sort of socialism without saying so.
Mr. Speaker, we know that when the state interferes in business which could normally be dealt with by individuals themselves, that always cost a lot of money, that is always much more expensive, we understand and we recognize the need for the state to step in where necessary to make up for possible deficiencies in private enterprise, free enterprise or individual themselves. But apart from that the tendency of the government to impose controls where people themselves could exercise them leads to cost increases, and those increases could be avoided and certain cuts made by avoiding that kind of policy.
Of course, as I said at the beginning of my remarks, ill chosen restrictions could be excessively damageable. For example, there can be no haggling over the need to give old people the money they need to meet their essential requirements. There is no question about that. But there are sometimes other kinds of restrictions which by ricochet could tend to increase precisely what we want to reduce, inflation. That is one of the reasons, once again, to justify this motion blaming the government for not having indicated from the start how it intended to restrict its expenditures.

October 30, 1975
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Mr. Speaker, it is always difficult and complicated to try to come out of a situation that has become absolutely dramatic when the actual causes of that situation lie in the very system which generates them. And it is regrettable to see that in that war consumers and the producer will be forced to reduce prices, the worker, the wage earner will be forced to accept less money but we know quite well that it will be complicated and difficult on both sides, and sometimes it could also cost a lot to check those things, to control them, as the benefit that one would want to draw from it. It is not easy, of course, to fight inflation, since I imagine we are intelligent enough to understand that, when one admits that the primary causes which are the cause of all those difficulties are due to a defect in the system itself.
For example, in all that war of price controls, wage controls, restrictions, government cuts, how is it that at no time is there talk about the chief and basic reduction and control of interest rates. There is no mention of that, but how are price increases to be controlled if interest rates are not? How can a firm reduce its costs if it must borrow at astronomical rates? There will be no other way out other than forcing these firms out of business, thereby fanning inflation. It is amazing that they will not tackle that sore. Stepping out to control credit, that is the crux of the matter, and they ignored it. I do not wish to utter evil prophecies, however I must say that everything done now to prevent the current situation from getting worse is useless. I fear they will wait till the very last moment to realize the need to deal with the real problem.
Fighting inflation, practising restraints, all that sounds very nice. If they stopped and took the time to do some real and serious thinking, they would realize that even if we spent nothing, we would still have to live, to eat, to clothe ourselves and sleep somewhere. There are no cuts to be made there. If we need a lot of money to get good food, good clothing, good housing and the minimum of comfort to which we are entitled in a country as rich as ours, if it is only a question of monies, all we have to do is issue ourselves the money needed. We will never repeat that too often.
There lies the true problem, the only way to fight inflation. If we could produce everything we needed through adequate credit, prices would go down. And if prices went down, there would be less reason to fight for higher wages.
This is why I regret this sad situation. With all the goodwill in the world, we know very well that these government restrictions will be to no avail. What does it mean to cut off a few millions here and there!
We should simply arrive at a better administration and avoid the terrible wasteful spending that we witness much too often. If we could today make the government understand the need to find ways to avoid wasteful spending, we could make the policy healthier. But, and I would like to conclude on this note, a few cuts will not solve the problem of inflation. A few cuts in expenditures will not solve the problems which the government will have to face, and it knows it. These problems will only become more serious and more dangerous in a few weeks or a few months because their roots are not being attacked.
I therefore wish that because of this new awareness, the government may, at a given moment, consider the possibil-

ity of getting to the roots of the problem of inflation by thinking first of all about reducing the interest rates.


Gerald William Baldwin: Mr. Speaker, let me first congratulate the hon. member for Champlain (Mr. Matte) for being the first member of the House since the Leader of the Opposition (Mr. Stanfield) spoke to pick up the nature and the quality of the motion standing in the name of my leader. I pay tribute to his reaction to it. I will in due course deal with the President of the Treasury Board (Mr. Chretien). The hon. member for Champlain opened his remarks by saying that this motion constitutes a test of the government's intentions. He is quite right. It is a test that so far the President of the Treasury Board has failed dismally to meet.
As for the leader of the New Democratic Party, the hon. member for Oshawa-Whitby (Mr. Broadbent), he as usual gave us the characteristic, neanderthal socialist policies going back to the reactionary-


Some hon. Members:: Oh, oh!


Gerald William Baldwin: That is the most reactionary party in this House. They are espousing policies that were fashionable 60 or 70 years ago. They simply have not caught up with modern times. It is a pity that such a bright young man should be wedded to such a dismal and dispirited cause.
I want to say this about the hon. member for Champlain. He also took up the question of the nature of the requests made by members of the House from time to time. Of course there has been a need, and there will always be a need, for members to suggest that the government should change the emphasis in its spending. I would not adequately represent my constituency if I did not think that funds might better be directed in some other way than they are at present. That is the nature of these requests which are made to the government from time to time.
The President of the Treasury Board has given us his usual dull, listless, limp speech. I have heard it at least six times in the House recently. Having heard it again, I feel deeply discouraged. When the Prime Minister (Mr. Trudeau) came in today, he looked grim and dispirited. I know he has had a cold and I sympathize with him on that score, but there are other reasons for his apparent discouragement. He and some of his ministers have been away on an individual and collective economic safari, with themselves as beaters, gun carriers and spear bearers. After wandering across the length and breadth of Canada trying to sell a very difficult program-and I can appreciate the difficulties they encountered-a certain grimness of mood is understandable. After all, on October 12, 1975, the economy was in good condition. Inflation was not worrying anyone-certainly not anyone on the government side. The fiscal and monetary calculations established by the budget of the former minister of finance in June were right on line. Everything was fine; there was nothing to worry about at all.
Then suddenly, on October 13, tragedy. We are faced with inflation, or "apprehended" inflation, if I may borrow the famous word used in 1970. The Prime Minister finds
October 30, 1975

himself confronted with what is likely to be the most formidable task of his career, that of persuading the people of Canada to support the program he has put forward and, what is more difficult still, to believe in the government's sincerity.
I am shocked at the line taken by the President of the Treasury Board. Surely, there are members of his staff who have read our motion. We are not saying that cuts should be made here, or there, or somewhere else. The minister's own colleagues have been going around the country telling us that the economy is in a dangerous situation, that the Canadian people must realize the seriousness of the position, and that the government, as proof of its sincerity, intends to do something about it. What we are saying is: show us. This is the test.
Members opposite have the unparallelled audacity to ask the people of Canada to make the sacrifices which will be necessary to accommodate government policy, while lacking the nerve, the energy or the wit to come before parliament and say, "Here is what we intend to do when it comes to restraining our own spending." Do not talk about the restraint shown in the budget of June, 1975. All that happened then was that the former minister of finance, beating his breast, told us, "I had to do a terrible thing; I had to tell my colleagues they could not get all the money they were asking for. I had to cut them down." But we never saw the comparative figures. He did not tell us what the original figures were. His protestations were a load of garbage, and the minister knows it. If he had tabled the original requests and shown how they were cut down, we might have had some respect for his decision. But all he told us was that he had made these cuts. We do not accept that. It is a lot of nonsense.
Even if our motion had been couched along those lines, the minister's response was a flop. But it was not couched in those terms. It states that the government should set an example to other Canadians by forthwith indicating the nature and the extent of the restraints it was prepared to accept. That is what we are asking: either put up or shut up. If the government is prepared to exercise restraint, let the House and the country be told by what means. Until the government does so, no one will believe what it says.
I say, in all sincerity, that I do not like the government's program in detail. I do not think it will work as presently set up. But I am one of those who took part in the debate and said I was prepared to make an effort to bring about a bill which would work; and we need a bill which is going to work because the country cannot continue much longer under the type of fiscal and monetary programs the government has foisted upon us. I know the President of the Treasury Board did not have much time in which to prepare for this debate. But, equally, we did not have much time in which to put down our motion. I should have thought the minister would have guessed this was the kind of motion the official opposition would put forward under present conditions. But if the minister had come here today and instead of his tired old speech had given us a firm indication of what he was going to do, the position would be vastly improved. However, he does not intend to, and the reason is that he does not know how; he hasn't the faintest idea.
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Joseph Jacques Jean Chrétien: What about the reduction in man-years for next year-1.5 per cent?


Eldon Mattison Woolliams: That is like going out to buy a Cadillac and ending up with a Chevy: you have saved money.


Gerald William Baldwin: The trouble is there are too many of these artful dodgers, and artful dodgers cannot easily sell a program of the kind the government has brought down. But unless they do, the program is doomed to failure. I am not going to deal with them per se because they are now in committee, but I can deal with what is collateral to the proposal in the bill, namely, fiscal and monetary policy.
We are dealing with fiscal policy here, in the sense that there has to be some restraint. If the government cannot do any better two months from now than it is doing today, then this program is going to be a sham, a failure and the country is going to be in a mess. What will the government do then? This is why we have provided this opportunity for the government to give us some earnest ideas of its determination and its intentions with regard to these issues.
This is a public relations exercise with gigantic stakes- the survival of this country as an effective economic unit for a great many years to come. They are the stakes that exist in this program the government has put forward. If the government can do no better than the minister has today, then it will be in trouble. I can understand why the public and the press reaction to the attempts of the Prime Minister, the Minister of Finance (Mr. Macdonald) and others to make the program stand up and to appear to be a reasonable and logical one has been universally so negative. I feel that this is at the root of the issue we are now facing.


Stanley Howard Knowles: Are you now going to tell us what Senator Lawson said?


Gerald William Baldwin: I think that is an irrelevant question. My friend probably knows him a lot better than I do, and I am sure he can deal with Senator Lawson. I dealt with his leader; he can deal with the senator. But I should not say too much about the other place in front of the hon. member. In any event, I just want to touch for a moment on the budget and on the budgetary deficit. I think the President of the Treasury Board, perhaps quite naively and innocently, misrepresented or misstated certain facts and possibilities. In the first place, I support what my leader said and I challenge the minister to tell us what the deficit will be. Both he and I know that supplementary estimates will be brought in. What will they be, and how much? I challenge the minister to put those facts on the record.
My belief is that the government will be very careful not to bring into the House the total package of supplementary estimates before Bill C-73 has been passed. We would only be looking at that part of the iceberg that is above the water, not at the gigantic part that lies below. I suggest to the members of this House that the total amount of supplementary estimates the government will be bringing in will substantially alter the balance of payments and the fiscal situation of the treasury, making it look completely different from the one envisaged by the former minister of finance. This is one of the reasons we
8712	COMMONS DEBATES	__October 30, 1975
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are not being given the supplementary estimates and why we will not get the total package until this program is out of the House and out of this parliament.
In June of 1975, the minister indicated that there would be a budgetary deficit of $3,175 billion. The President of the Treasury Board never gives us the correct facts because he is never listening when he is being told something factual. We were told the budgetary revenues would be $25,725 billion and budgetary expenditures $28.9 billion, leaving a deficit, which I think even the minister would be able to calculate, of $3,175 billion. My leader was talking _ about deficits, and the President of the Treasury Board responded in those terms. I can only gather that he was so excited at the successful speech of my leader that he was not able to direct his attention to the true facts. I believe, assuming that collection and spending patterns remain the same and that there are no major alterations in federal fiscal policy in mid-year, the past patterns of financial operation can be applied to existing revenue and expenditure figures for the first four months of fiscal year 1976. Actual revenues can be expected to be $25,508 million, and expenditures $33,232 million.
From that we draw the inference that there is a very serious likelihood that the budgetary deficit will not be $3,175 billion, but $7,724 billion. This information the government is either hiding or is ignorant of. In either case it deserves to be severely castigated for its failure to come clean with the country, in view of the very serious situation we are facing at this time in our history. In this situation, with this knowledge behind the government, it is no wonder the Prime Minister and his colleagues cannot summon the sincerity that is absolutely essential to convince the people of Canada that the government means what it says and intends to involve itself in some form of restraint.
May I just take another two or three minutes to finish what I have to say. My colleague from South Shore (Mr. Crouse) is going to deal in some detail with the latter part of our motion, but I want to put on record a couple of sentences or so about it. The minister said today that he would be bringing in a bill shortly, or within several weeks. I hope he is right. If this motion does nothing other than compel the government to do this, then it will at least have been valuable.
It is ten years ago that we first asked that there be legislation to deal with the Auditor General, some form of separate legislation. We have been up and down the scale, year in and year out, with the government hiding, with the government being guilty of deception, with ministers like the Minister of Public Works (Mr. Drury) who are very gun-shy of the Auditor General, using all their power and authority to prevent such a bill being brought in. We have been fooled and deceived too often and I would warn the minister, as I warned the President of the Privy Council (Mr. Sharp), that we intend to keep on at this and see that legislation is brought in.
After all, Mr. Speaker, as the hon. member for Champlain said, waste and extravagance may not amount to so many billions of dollars; but when I go into a supermarket, as others of my colleagues do from time to time, and see harried men and women concerned and anxious, people who with their families must pay every attention to their 
expenditures, then it is essential that as an earnest of the government's intentions it bring in this legislation within two or three weeks. We will then know that the government is attempting to show the people of this country that their money is being properly and wisely expended.


Mr. Herb Breau (Gloucester):: Mr. Speaker, I think the hon. member for Peace River (Mr. Baldwin) said he had heard the speech of the President of the Treasury Board (Mr. Chretien) six times. I must say that the only new thing I learned from the hon. member's speech was that he does his shopping with his wife on weekends. In fact, his speech is a repetition of many of the things we have heard in the past.


Gerald William Baldwin: Not only on weekends.


Herb Breau: That is even better. This motion gives me the opportunity of putting forward my views on government spending and on the myth being spread by some prominent members of the Conservative party, perhaps because of events to occur next February, that government spending is inflationary and so bad for society. I think that is a myth. The President of the Treasury Board indicated earlier this afternoon the percentage of government spending that is statutory, which means it is provided for already by legislation. He also pointed out many cost-sharing programs which we have with the provinces.
Putting aside for a minute the conventional questioning about government spending to regulate the income and the impact of government spending on inflation and the cost of living, one can see that there is little room in this country for more government spending to have the necessary impact on the economy. Just under 20 per cent of the federal budget this year is directly related to operational and capital expenditures. In other words, any amount of money that you cut must come from those areas of operational and capital expenditures controlled by the federal government. That is the only area you have to work on. For that reason, I suggest those people who speak about the possibility of substantial cuts in government expenditure cannot be serious unless they are referring to statutory programs.
If these members are referring to those programs, they must keep in mind that this would drastically change our social structure and our federal-provincial relationships. Surely, this would bring us back to the situation that existed 10, 15 or 20 years ago when a lot of people in this country were living without opportunity, and many in misery.
The role of government in society has changed. Following the Second World War, the western world concentrated its efforts toward economic development. Then the 1960s and the 1970s came along and everyone realized that in order to maintain a stable society in which people could live a decent life, governments would have to attack many serious problems. Governments had to be more concerned with social development. This is why we spend so much money today on statutory programs, and it is why we have such a high investment in social programs today. This is directly the result of the changing role of government in modern society.
October 30, 1975

Let me deal very briefly with what the Leader of the Opposition (Mr. Stanfield) had to say. Let me refer to his comments in respect of DREE, in the context of government spending. I am sure the Leader of the Opposition is aware of the danger this type of criticism may have for some parts of the country. Some parts of the country might become overly concerned with such dramatic references to DREE, as happened in 1971 and 1972, and this can only hurt the program. I know the Leader of the Opposition does not want that.


Robert Lorne Stanfield: That is why you had better develop a decent program.


Herb Breau: I would like to remind the hon. gentleman of the danger created by this type of dramatic statement. This is an area which is very costly and is very difficult to administer. Development is not easy in this country, just as it is not easy anywhere else in the world. There are hundreds of examples that anyone could find, in respect of DREE, of money not being spent in accordance with the normal rules and procedures. But that is the price you have to pay for development. I hope the Leader of the Opposition will be careful, when discussing government spending in the next few years, not to start again the kind of debate we had in 1971 and 1972 which resulted in such harm to the program. Most of the examples being dramatized were exaggerated and most of them, on consideration, could be easily explained.
The Leader of the Opposition and a number of his colleagues referred to the Unemployment Insurance Commission in the last week or so during the debate on Bill C-69. I intend to speak on that bill next week, so I will not deal with it at length this afternoon. Let me just remind hon. members that the amount involved is not $4 billion but is more like $3.6 billion for this year. Many hon. members were not being entirely honest when they compared that figure with the old program, in that they did not mention that much of this money is recoverable through income tax because the system has now been made more equitable. Benefits under the Unemployment Insurance Commission are now taxable.
It is difficult to determine what amount is recoverable in taxes. I am attempting a study in this regard in the hope of coming up with an approximate figure. Surely, hon. members who want to be entirely honest when referring to the $3.6 billion going out in unemployment insurance benefits this year should mention that a proportion of it is coming back in the form of income tax.


Gerald William Baldwin: And administration costs are up 100 per
cent.


Herb Breau: I am not suggesting that; I am suggesting that if hon. members want to be entirely honest they should mention the amount that is recoverable through our income tax system. They cannot refer to an actual figure, but they could mention the fact that a lot of this money is recovered in income tax. As a matter of fact, I have made a study of this. I understand that this year, if you take into account the amount that is recoverable through income taxes, the UIC program is close to selfsufficient. Perhaps in this way contributions by employers
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and employees would not be required to be increased and the government contribution would be less.
This being a political forum, I can understand that members make political arguments. They want to embarrass the government and use figures that confirm their arguments. I just want to put on the record the fact that when hon. members talk about the $3.6 billion being spent on unemployment insurance benefits, this is actually less the amount recovered through income tax. When people talk about contributions by employers and employees, the figures should reflect the amounts being allowed as deductions from income tax following the adoption of a more equitable tax in 1971.
I was happy to hear the tone of the speech by the Leader of the Opposition. I have always thought he has a moderating influence in this House and a moderating influence on his party. The real force behind a motion like this is the force evident in those members who feel the government should not intervene as much in society, and in those who are against the kind of statutory programs we have adopted in this House in the last ten years, such as medicare, the Canada Assistance Plan, UIC and all the others.
Of course these programs are inflationary. Everyone knew that when they were adopted. I have admitted before parliamentary committees, as have ministers of this government, that if you cut taxes for low income people and increase old age pensions and family allowances, this will have an inflationary effect. There are some inflationary aspects of these programs, and we all know that. What we are saying is that this is worth the price. A lot of people get too upset about inflation, and they exaggerate. One of the things we must do is make sure that those less capable of looking after themselves are assisted in adapting to inflation. If your costs are increasing by $1,000 a year and your salary is increasing by $1,200, I do not see any reason for individual concern.
We have built-in inflation in our system because we adopted many of these social projects, many of them when the Tories were in power. The Tories approved of them at that time. The same trend existed in the United States. The Johnson administration was after the same thing because it had been decided by western democracies that income should be distributed.
How is income distributed? There are many ways to do it. We may disagree on the means, but it was clearly decided in the course of the 1960s and 1970s that it was necessary to distribute income in democracies and in our society because there was no way we could tolerate the kind of social situations which we saw. Not one member on the other side wanted to do so.


Gerald William Baldwin: On a point of order, Mr. Speaker, may I say I am one member who is entitled to challenge the hon. member, because I was a member who ten years ago placed on the record a clause which stated, in effect, that our payments for things of this kind should be geared to our productive capacity and our ability to pay for them.


Herb Breau: That is right. I hope nothing I have said will contradict that. I do not want to become involved in an argument with hon. members. I have not yet dealt with
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October 30, 1975
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that matter in my speech. I hear an hon. member opposite giving a very simplistic definition of inflation. There can be different kinds of inflation. There can be inflation caused by lack of productivity and there can be demand inflation. Many of these programs are inflationary in nature.
If we distribute income and give money to sectors of society which, because of their nature, may not spend it as wisely as if it were invested in the national interest, of course it will be inflationary. Particularly in a country like Canada, where income is distributed in sectors not only in terms of people but also geographically, of course inflation will be created in some parts of the country. I agree with the hon. member for Peace River that we should try to relate this as much as possible to productivity, but the fact is that we have done so as much as possible in the last ten or fifteen years.


Gerald William Baldwin: Then what is the Prime Minister doing trotting around the country?


Herb Breau: I will answer that interjection from the hon. member for Peace River who is now on his way out of the chamber.


Steve Eugene Paproski: He is just answering a telephone call.


Herb Breau: He is just answering a telephone call, I am told. I know that he is a very assiduous member of this House. I will answer the question by saying I do not want to deal with the new anti-inflation program of the government, because this is not the nature of the motion. The hon. member for Peace River spent much time talking about economic and fiscal policy, while the motion does not deal with that. So I do not want to be carried away into a debate on economic policy.
The speech of the Leader of the Opposition this afternoon had a moderating effect. We have heard in public that many people within his party, because of future events, want to have less intervention and less of these statutory social programs. I am not one who wants that. There is no way a man could have been the premier of Nova Scotia or could even have been elected in the Atlantic provinces if he did not think that government intervention in society is good. So I was happy to hear the tone of the speech of the Leader of the Opposition, because I think he agrees with me that in a modern society, one who speaks of restricting government spending and restricting government intervention must be out of his mind. If we want more technology in order to compete better in the world, there will have to be dislocation of workers; therefore, there is need for training assistance, government intervention and government spending.
If we want to have a high degree of productivity and to be one of the most technically advanced nations in the world, we will have to transform our industries. There is an example in my constituency. It is one of the things the government of New Brunswick has done. It has rationalized its forest management policy. In that context, DREE has been involved. The federal government has been very substantially involved in studying this whole question and coming up with a new approach to forest management policy. The centre of this was the construction of a new lumber mill. Unfortunately, the timing was not too good

because the lumber market has been depressed. Because we want to be more efficient and more productive, this mill, which is highly technological and very sophisticated, has a relatively small labour force in relation to the volume of lumber it will produce, compared to the old type of family-owned sawmill, and so on, that has been in existence in New Brunswick.
Here is a case of the government of New Brunswick and the government of Canada, in the national interest perhaps creating unemployment because there is a desire to be more productive and to produce lumber at the best price and volume for export to the United States. Many of the small mills, particularly because of the depressed lumber market, are not able to compete with the prices this new mill charges for the lumber it is placing on the market. They have been unable to compete, and in future we will have to transform the lumber industry of New Brunswick in order to have a more rational use of the trees in our forests. That is good for the country. In the long-term it is good for northern New Brunswick and the whole of New Brunswick.
But in the process many workers will be dislocated. This will apply to the small, family-owned mills. Many workers will be dislocated in the cutting industry because many of them use traditional or conventional types of machinery to cut the trees, while it is new equipment that is being used now. This is a case in which we have a trade-off between protecting maybe 125 good jobs for the future that will be competitive and in respect of which a government handout will never be required. That is good. In the process, however, we must look after the people who have been dislocated. This can be done in society only by government intervention through Manpower Programs, Local Employment Assistance Programs, Canada Assistance Programs and many similar programs.
I am glad the Leader of the Opposition did not take a stand today to support those within his party who publicly in the last few months have suggested that the government should intervene less in society. I am glad the former premier of Nova Scotia is not the type of politician who would get on a bandwagon which is so popular in some places in Canada today and say that government spending should be restricted. There is no question that so far as the 56 per cent of structural spending is concerned, this is where a cut could be made that would have an impact on inflation and on the economy. But anyone who suggests we can have a drastic cut in the structural spending of the federal government is out of his mind, because it is a complete contradiction of what society is all about.
I should like to deal very briefly with the remarks of the hon. member for Oshawa-Whitby (Mr. Broadbent) who first of all described the government's anti-inflation program as restrictive. I agree there is restriction in some cases. There is restriction in respect of big unions and the powerful in society, but there is no restriction so far as the low income wage earner is concerned, because without this program he could not catch up and the big powerful unions would continue the galloping increases of 18 per cent and 25 per cent. So we should not call this a restrictive policy.
October 30, 1975

With regard to some of the industry programs the hon. member mentioned, and some other programs, my comment is that he cannot be serious when he suggests that when government has to intervene on the social side, it must not also intervene on the industry side to make sure, first of all, that industry becomes efficient, productive, follows the technology used in the world and is co-operative. Being an academic, I can only say that he might have a conflict of interest, because instead of industry he wants academicians to do the work. However, there is no question that the government must work closely with industry in research programs and with that kind of intervention.


Some hon. Members:: Hear, hear!



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Medicine Hat (Mr. Hargrave)- Grain-Suggested deferral for income tax purposes of interim payments; the hon. member for Cape Breton-East Richmond (Mr. Hogan)-Cape Breton Development Corporation-Request of United Mine Workers for investigation of management of corporation-Government position; the hon. member for Humber-St. George's-St. Barbe (Mr. Marshall)-Veterans Affairs-Prisoners of war-Date of implementation of recommendations of committee.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Stanfield:
That in the view of this House, the government should set an example to other Canadians by forthwith indicating the nature and extent of the restraints on government spending and should also introduce without further delay measures to implement the Wilson Report on the office of the Auditor General as an indication of its willingness to eliminate waste and extravagance.
Lloyd Roseville Crouse: Mr. Speaker, I welcome the opportunity to speak on this supply motion, especially the part which states that the government should "introduce without further delay measures to implement the Wilson Report on the office of the Auditor General as an indication of its willingness to eliminate waste and extravagance."
Before I deal with the main body of my speech, quite frankly I listened with some amazement and concern to
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the speech made today by the President of the Treasury Board (Mr. Chretien) as he repeated over and over again that members of the Official Opposition never give him any concrete suggestions for curtailing expenditures, but keep asking him for more and more.
I do not wish to be overly repetitious in debate, but when speaking in the House on October 23, 1975, I gave in some detail a number of concrete proposals covering cuts in expenditures which, if implemented only in part, would cut back some half a billion dollars from government expenditures without basically affecting the lifestyle of Canadians.
Obviously the minister is not interested in receiving sincere, concrete proposals; rather, he can only list a group of expenditures, which he did today, which he claims cannot in any way be curtailed. I will ask him again to refer to page 8491 of Hansard for October 23, 1975, and at least give consideration to the proposals I made, which I hope will be helpful.
The credibility of the government is at stake, and its credibility is strained. There is no question in anyone's mind why this should be so. All one has to do is to look at the Ottawa Journal of October 29 to read that the cost of renovating the former LaSalle Academy on Sussex Drive as headquarters for the Minister of State for Urban Affairs (Mr. Danson) doubled between January, 1973, and December, 1974, according to a Department of Public Works spokesman. The additional cost of restoring the historic building was estimated at $4.3 million. By December, 1974, Treasury Board had approved expenditures totalling $8.3 million.


Gerald William Baldwin: Shocking.


Lloyd Roseville Crouse: This type of expenditure, a mismanagement of government funds, puts us as Canadians in the position we are today.
The present powers of the Auditor General of Canada are derived from sections 56 through 65 of the Financial Administration Act. The office, of course, predates confederation. Numerous attempts have been made to draft new legislation in order to resolve the controversy between the previous Auditor General and the ministry. Some were prepared at the instigation of the then president of the treasury board, one was drafted by the Auditor General himself, and two had their origins in the Standing Committee on Public Accounts. None of these drafts envisaged any change in the role of the Auditor General. Instead, all were largely concerned with housekeeping details.
A large number of the recommendations submitted by the Independent Review Committee can only be implemented by legislation or by some other form of executive action. In all of them, however, there is an underlying purpose, namely, to strengthen the office of the Auditor General of Canada, a purpose which the Public Accounts Committee must fully support.
There are some who would argue that strengthening the office of the Auditor General would provide a temporary improvement in the positions of political parties currently in opposition. However, I believe it would also ultimately strengthen the parliamentary system, and surely this
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October 30, 1975
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should be a goal which is shared by all members of parliament regardless of their political affiliation.
On Monday, June 2, 1975, there was a debate in this House on the subject of strengthening the office of the Auditor General. The general consensus reached by all parties on that occasion was that the present Auditor General is carrying out his mandate in an objective and systematic manner. However, in order that he can discharge his responsibilities more effectively and efficiently, his office must be strengthened by legislation and/or by executive action, if public spending is to be controlled and accountability to parliament is to be preserved.
The Independent Review Committee was established immediately after the present Auditor General, Mr. James Macdonell, took office in July of 1973. It consisted of three members: Mr. J. R. Wilson, chairman; Mr. Marcel Belanger, and Mr. Lome Campbell. Their work began in October, 1973, with the approval of the chairman and vice-chairman of the Public Accounts Committee, and their report was finally tabled by the then minister of finance on April 8, 1975.
The Wilson Report, as it is sometimes called, is in both official languages. It is divided into three parts, entitled Background, Responsibilities, and finally Relationship, Resources and Independence.
Chapter 10 embodies the conclusions of the report and a useful summary of the major recommendations of the Independent Review Committee.
In reviewing the 47 recommendations made by the committee, it became clear that approximately 27 require legislation, eight request action either by the cabinet or the Treasury Board, and two by the Public Accounts Committee or other committees of the House. Nine recommendations have been or are being implemented by the audit office. So far only one imposes a problem of implementation.
The important recommendations can briefly be grouped as follows:
1.	What the Auditor General is expected to report to the House of Commons should be more clearly defined and, in particular, should include the right to report on expenditures where value for money has not been obtained. To discharge this and other responsibilities the Auditor General should have the freedom to examine any accounts and records he considers necessary.
2.	The major financial statements of the Government of Canada that are presented in the Public Accounts should be expanded to include a "sources and applications of funds" statement and the Auditor General should provide an opinion as to whether or not they are in accordance with stated accounting policies that have been applied on a consistent basis from year to year.
3.	Procedural changes should be made to reduce the lag in considering the annual report of the Auditor General by the Standing Committee on Public Accounts of the House of Commons.
4.	The Auditor General should be able to recruit and retain the numbers and kind of professional staff that he needs to discharge his responsibilities.
5.	The personal independence of the Auditor General must be ensured and Parliament must be certain he could not be vulnerable to administrative pressures that would hamper him in carrying out the examinations necessary to the discharge of his responsibilities.
Perhaps the most significant of all the recommendations presented by the Wilson Committee is the one in which it is proposed that the Auditor General should have the right to report to parliament on expenditures for which value

for money has not been obtained. This proposal transcends all the others, and I venture to say it will cause more debate within this ministry than any of the other proposals made so far.
Generally speaking, the present situation is as follows: the Financial Administration Act requires the Auditor General to perform certain specific tasks. It also provides that he is to report, "any other case the Auditor General considers should be brought to the notice of the House of Commons." These last words are the ramp from which Mr. Maxwell Henderson launched his attack on unproductive expenditures. It was with Mr. Henderson's right to comment on such expenditures that the then president of the treasury board took issue.
The Wilson Report proposes that the Auditor General abandon the concept of non productive expenditures and, in its stead, be specifically empowered to assess whether the public is getting value for money expended. The concept of value for money, according to the report, involves three interrelated components: whether the money is expended economically and efficiently, and whether the program on which it is expended is effective in meeting its objectives.
The position taken by the Wilson Committee is that the cabinet and the bureaucracy act as a kind of trustee of public funds, and that the Auditor General can be viewed as a kind of monitor of this trusteeship. Although the report does not elaborate, these three concepts are usually defined as follows: economically means the acquisition of the program inputs of a given quantity at the lowest possible price; efficiency means that the inputs were of such a kind or deployed in such a way as to produce the largest possible tangible output of a given quality for the dollars expended; effectiveness means that the objectives of the program were achieved at the lowest possible cost, or the desired results were obtained to the greatest possible extent commensurate with the resources provided.
Although the term "unproductive expenditure" has still to be properly defined, I believe it has come to mean any expenditure that did not result in a final product, however useless that product might be.
Two examples of unproductive expenditures that come to mind are the plans for the Prince Edward Island causeway and the refit of HMCS Bonaventure. In the case of the former it was a payment for a feasibility study that concluded that a particular proposed project was not warranted. In the case of the Bonaventure the right hand obviously did not know what the left hand was doing. Repairs were carried out on a ship declared surplus to our needs. In both cases tens of millions of dollars were wasted, and it is this type of waste that has led to our present explosive economic situation.
There may be some difficulty on the part of the department to accept the concept that the administration should be viewed as a trustee of public funds. However, it is important to recognize that the administration, unlike the usual trustee, does not have a clear direction as to what it is entrusted to do.
In my view the report's basic proposals with respect to the Auditor General's right to report on economy, efficien-
October 30, 1975

cy, and effectiveness are sound if properly interpreted. Perhaps it would have been preferable if the argument had been expressed in terms of the public's right to know rather than in terms of the rights of beneficiaries under a trust. After all, the fundamental reason why the Auditor General should report to parliament on these matters is that it is obviously not in the interest of the department to make such information available when the results are unfavourable.
Moreover, given the degree of secrecy a government administration can maintain, the opposition parties or the electorate usually do not have enough insight or knowledge to ask questions that would elicit the relevant information, even when they have the right to obtain it. Thus the adoption of these recommendations with respect to value for money is a means of breaking through the present secrecy barrier of the department, and a means of informing the Canadian taxpayers of the stewardship of their money.
It would be incorrect to say that the adoption of these recommendations would resolve the endless controversy that surrounds government expenditures. Through more disclosure and more public debate, however, it would help the public to assess the efficiency and effectiveness of government programs.
Furthermore, it would be incorrect to expect that the Auditor General would use his staff to carry out efficiency and effectiveness studies; rather Wilson suggests that he should report on such questions as whether departments are undertaking efficiency and effectiveness studies on their programs and, if not, why not? All too often the basic data required to which these methods could be applied are not being collected, much less analysed. If the studies have been conducted, have the results been made public? If not, why not? And do the data used and the methodologies applied give results that are reliable and justifiable within certain cost constraints and potential cost savings?
Finally, the most important danger to the audit office, if it were to engage in such studies, would be the lack of consensus about data and methodologies in which these studies would inevitably embroil the Auditor General. They could lead to intensive political controversy, and thus eventually threaten the integrity of the office itself.
I cannot help but conclude that although the department may be unwilling to legislate the value for money concept, the Auditor General under the existing provisions in the Financial Administration Act can adopt the Wilson report's recommendation in this regard and, with the committee's support, proceed to report those cases where value for money has not been obtained.
The adoption of the Wilson recommendations in this area would be a useful advance for parliamentarians in their review of the public accounts, and for students of public finance. One would hope too that the Canadian Institute of Chartered Accountants would set up some permanent committee to concern itself with government accounting principles, and would seek to monitor their introduction and implementation by government departments and agencies.
Already the Auditor General has formed a task force of professional accountants from the private sector to study
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this problem within government departments, and the formation of government accounting principles by an independent body would greatly assist his current endeavours in this regard.
The third recommendation, that procedural changes be considered that would reduce the delay in the consideration of the Auditor General's annual report by parliament should be of some concern to the Public Accounts Committee. The Auditor General does not report to the House of Commons for at least six months after the end of the fiscal year. And there have been delays of six months or more before the committee has had an opportunity to begin considering his findings.
Because the Auditor General's annual report is invariably bad news for any department, there is little doubt that the executive has little interest in speeding up the program and, indeed, has something to gain by the delay. Criticism of transactions that took place two years before, are less biting than those dealing with current decisions.
The Wilson committee, in my view, clearly did not want to affront parliament by making a firm recommendation about its own procedures, but it is clear that the present arrangement is favourable to the department and should be tightened to reduce the degree of discretion it presently enjoys. The recommendation for an automatic referral, therefore, would be one practical proposal for the Standing Committee on Public Accounts to consider and recommend to the Procedure and Organization Committee for inclusion in the Standing Orders of the House of Commons.
At the same time the Public Accounts Committee should consider very seriously the automatic referral of the Public Accounts of Canada on the same basis as the Auditor General's annual report. This point was not raised in the Wilson report because it was considered outside their terms of reference. However, as was experienced by the Public Accounts Committee during the current session of parliament when the public accounts for the fiscal year 1974 were not referred to them, the committee's power to examine government expenditures was greatly reduced. This in turn made the systematic review of departmental accounts more difficult and less penetrating for all members of the committee, not only opposition members, in their examinations. In my opinion the recommendation for an automatic referral would therefore improve the committee's effectiveness in its reviewing procedures.
The Wilson report describes what transpired in the most neutral possible manner, and makes a number of recommendations. In my view the most important is the proposal that the Auditor General be given separate status so that he could classify his own positions and thus be free of the authority of the personnel policy branch of the Treasury Board.
In the past two years Mr. Macdonnell has introduced major innovations in his office. He has published his annual reports to parliament within the appropriate nine months of the end of the fiscal year on March 31, and has streamlined his reports so that the Public Accounts Committee can deal with them more quickly. Mr. Macdonnell tells me he hopes within a year or two to speed up publication so reports can be tabled in the Commons at the beginning of the fall session in October, a move that would further assist the committee.

October 30, 1975
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Another new approach adopted by the audit office has been to recommend changes to government departments following wasteful ways, and to report the results. The audit staff will be returning to these departments to ensure that the recommended changes have been put into practice.
As previously mentioned, a third important innovation recently introduced has been the creation of a special audit branch within the audit office for the conduct of special studies. Using private sector professional accountants on the public service executive interchange program, the Auditor General has sent highly qualified staff into Crown corporations, government departments and agencies, to investigate their internal financial management control systems.
The adoption of this private sector approach has been the main theme of the independent review committee whose recommendations, we have seen, are practical, logical, and necessary if the office of the Auditor General is to increase its effectiveness and efficiency in its examination of public spending.
Reports so far indicate that the government favours introducing legislation to redefine the role and responsibilities of the office of the Auditor General, but so far there is no indication when it will appear on the legislative timetable. One thing is certain. Any legislation introduced may well be non-controversial, which suggests that the "value for money" concept might not be included. I hope that in this regard my assumption is incorrect. Notwithstanding this provision the Auditor General, now supported by the Wilson report, has an opportunity to do Canada an enormous service while serving as watchdog of the public treasury. That, obviously, is an important duty, especially in light of the financial revelations we have received from the Auditor General.
The Auditor General can also help to increase the degree of public acceptance of decisions reached under our existing parliamentary system. We must do our level best to eliminate waste and extravagance, not only to make this government credible but to make the present parliamentary system credible to the Canadian people. Judging from the unrest we see portrayed on national television and in our daily newspapers, we have a long way to go if we want to win this particular battle.


Mr. Fernand E. Leblanc (Parliamentary Secretary to Minister of Labour):: Mr. Speaker, opposition members who rose this afternoon seemed to resent the kind of answer they got from the President of the Treasury Board (Mr. Chretien), but I am not surprised at all, because the terms of the motion undeniably may lead to some confusion. It is a threefold motion, which reads as follows: First, That in the view of this House, the government should set an example to other Canadians by forthwith indicating the nature and extent of the restraints on government spending-
Second,
-and should also introduce without further delay measures to implement the Wilson Report on the office of the Auditor General-

Which has nothing to do with the foregoing. And third- -as an indication of its willingness to eliminate waste and extravagance.
And while the leader of the opposition (Mr. Stanfield) indicated it was a test for the Liberal party regarding anti-inflation measures, I do not think there is any indication of a test in the motion, especially as opposition members themselves seem to be somewhat confused, since the previous speaker mentioned only the Wilson report a few minutes ago. He made absolutely no mention of the other two points of that motion which in my opinion are nevertheless quite important.
Therefore, it cannot be said that this is a test respecting anti-inflation measures which the government intends to take. It can be said that it is a waste of energy on the part of this House to discuss such a blurry motion, a motion of strictly political meaning which, in my opinion, is demagogic since no particular subject can be dealt with and since the motion bears on three very important elements. It is clear, however, that the Wilson report is very important, that the restraints announced are very important, that the measures to eliminate waste and extravagance also are very important, all of which is written in the motion.
I feel that, considering the 25 days allotted to it, the opposition could surely have found something more appropriate to discuss and it could perhaps have separated the motion into three parts. Today we could have discussed a test for the anti-inflation program. The motion could have stopped after the words-
-the restraints on government spending-
Then, the President of the Treasury Board would surely have replied differently because the motion before him would have indicated some restrictions on government spending.
But that is not the case; at one and the same time the Wilson report and the question of waste are also introduced.
So, Mr. Speaker, if we are to try to discuss all that, the time at our disposal is obviously too short; that would take at least three to four days of debate.
To my mind, the opposition muffed it with regard to its motion. To my mind, it is in no way a test of our restriction program. This motion was not thought out before being placed on the order paper and, of course, this creates problems when we, of the government party, wish to make a contribution and reply to the objections made either by the members of the official opposition, or by the NDP members or by the members of the Social Credit.
I especially liked one of the contributions of the Social Credit explaining the difference between expenditures and wasteful spending. These are obviously not the same thing, and this is why I said a while ago that I do not see how you can in the same motion talk about expenditures and wasteful spending because the government and Parliament have absolute authority as concerns expenditures through the estimates which are submitted to the House and to the various committees where opposition members spend many hours discussing government expenses and voting for them most of the time. When they have objections about expenditures, they make them during the review of the estimates, and that is when I believe they
October 30, 1975

must state their arguments and tell the government what other action it should take to try to limit its expenditures.
Mr. Speaker, may I call it six o'clock?


Mr. Deputy Speaker:: Does the House agree to call it six o'clock? It is agreed.
It being six o'clock I do now leave the chair until eight o'clock this evening.
At six o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
Fernand-E. Leblanc: Mr. Speaker, as I was saying when the House took recess at six o'clock, the motion introduced by the members of the loyal opposition and presented by the leader himself, who will no longer be the leader in February, contains three specific points which were creating confusion for the Progressive Conservatives and everyone else. It was even reported that this motion was very important because it was putting the government to the test to find out whether the restrictive measures are related to the offensive against inflation. If such is the case, as the leader of the opposition himself pointed out as well as the opposition leader in this House, if such is the case I am wondering how it is that the Progressive Conservative leadership candidates-there are quite a few and they are indeed members of parliament-were not present this afternoon and they are not here now. It does not seem to me, that the motion introduced by Progressive Conservatives is all that important since the leadership candidates, one of whom will be the main opponent of the Liberal party in a few months, even these candidates are not in the House to hear their present leader discuss the test that he wants to put to the party in power and they are not here to take steps either. Members of the opposition cannot take a position, and I understand; they cannot take a position because very soon they will be selling something to their supporters and even to people who will not support them. Of course they do not want to stick their necks out at the present time in a case which, according to the leader of the official opposition, is a very important test for the party in power, to know whether the party really means to implement measures against inflation.
All this does not seem very serious to me, Mr. Speaker, and unfortunately, they are attempting to confuse things by introducing a motion which covers three very important subjects of debate. I do not see anything serious in this and as to waste, I think they are the ones who are now wasting the time of the House putting before it a motion that not even they intend to support.


Mr. Guay (St. Boniface):: They themselves are not convinced!


Fernand-E. Leblanc: Our party whip says that they themselves are not convinced, and I fully share his opinion.
Before the House took recess, I was dealing with the control over our national expenses and the checking after
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expenses are incurred. There is a very important difference. The estimates were studied in the House by Parliament, not only by the government, from March 1 to May 31; they were then reviewed in committee where we spent a great many hours considering government expenses. Since March, there is a new and temporary agreement between the parties. We even try something new when the Committee of the Whole House meets. Estimates are studied, and the opposition has every opportunity to discuss expenses control.
If this is the gist of the motion, I think there will be no problem, for the opposition may use the devil's or God's eye to examine government expenses. It is its responsibility to exercise its privilege.
Now, the Canadian people itself has access to very important documents through the booklet entitled How your tax dollar is spent, where they can see where their tax dollar goes. It is not very efficient to speak afterwards, when the spending is done, even if we talk of stopping wastage.
Once the spending is done, we have a watchdog called the Auditor General who is responsible for indicating the deficiencies which may appear in the exercise of some functions. Certainly, Mr. Speaker, there may be some errors in the administration of a budget of some $30 billion in about 30 departments; it is very human. Nobody can claim that there will not be any wasteful expenditures occasionally. That is why we have an Auditor General who goes over all the details once the spending is done. Later, he issues a report which is referred to the Committee on Public Accounts on which I have been sitting for almost 12 years already.
We then very carefully consider the propositions brought forward by the Auditor General concerning expenses which are at times extravagant and we table the report in the House. The public accounts committee is presided over by a friend of mine who happens to be away at the moment. He delivered a very good speech this afternoon dealing in particular with the Auditor General's duties and responsibilities. The report is written by the public accounts committee and tabled in the House. Later, the Treasury Board uses it to correct whatever shortcoming there may be, but when you are dealing with such massive expenditures, which by the way are necessary, I think you should expect once in a while some to be picked up by the Auditor General because they were not made according to the proper procedure and must be corrected.
And I should mention, I think, for the benefit of the newcomers that the C. D. Howe Research Institute published a very interesting review concerning government spending and wastefulness under the title Policy Review and Outlook 1975 Restructuring the Incentive System, edited by Judd Maxwell. In this very interesting book, there is an article entitled The Control of Government Spending.
This book is surely not partisan. It says that some government expenditures are controllable and others are not. It also shows the difference between controllable and uncontrollable expenditures. Among the latter there are, for instance, and I quote:

October 30, 1975
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Old age pensions are established by law under the Old Age Pensions Act and the government would have to amend the act before it could alter its spending either to increase or reduce pensions. In the long run, pension payments are controllable in the sense that the law can be changed by parliament, but for the moment we will classify these legal or statutory commitments as uncontrollable.

There are also so-called controllable expenditures among which the salaries paid to government employees, and I think that to a certain extent there is nevertheless an uncontrollable aspect in those expenditures. However, if you only consider what are classified as uncontrollable expenditures 58 per cent of all government estimates are uncontrollable, which leaves only, as mentioned here on page 39, and I quote:

The obvious corollary of this increase is that controllable spending has been shrinking so that it now represents only 42 per cent of government activity.

Now I find it difficult then to blame the government for its lack of control and its wastefulness. Moreover, among them they have a very devoted individual who is a candidate to the leadership. He was a member of the Committee on Public Accounts and he once put quite interesting questions to the Auditor General about the Glassco report. You know that the Glassco report governs at present the manner in which the federal government must control its expenditures and avoid waste. And this Progressive Conservative colleague asked the Auditor General: "Do you not think that since the Glassco report was published some ten years ago, it would be advisable to set up a new commission to give instructions to the government?
The Auditor General said that he does not think that this is necessary because for the moment he was using the "inter-exchange" program. He recruited 36 people from the private sector, all of them extremely well qualified experts doing research within the various departments who will report and bring forward some considerations with a view to trying to set up different control methods if the present methods do not work properly.
Besides, as someone said earlier this afternoon, the new Auditor General himself appointed in 1973 a non partisan committee, an expert committee instructed to review his status and examine the possibility of modifying the position of the Auditor General vis-a-vis Parliament, and this was published in a report entitled "Report of the independent review committee on the Auditor General's functions", the Wilson Report, named after the committee chairman.
This report, Mr. Speaker, contains 47 recommendations, all of them very valuable. In committee someone asked the question to the Auditor General to see if he agreed with the recommendations in that report, and the Auditor General mentioned that he agreed with all the recommendations. And he also mentioned something else. Most of the recommendations here can be implemented without enabling legislation from the government. Quite interestingly, since that time the Auditor General, as he said before the public accounts committee, already implemented several of the recommendations contained in that report 
himself. I think that may meet the opinion of the leader of the opposition and his colleagues, that the Wilson report should be implemented as soon as possible by the government.
Of course, that report contains things which do not necessarily rally the opinion of everyone. On the other hand, I think that we would agree with most recommendations but if I look at the brief which was submitted by the Canadian Institute of Chartered Accountants, of which I have the honour of being a member, I note that there are perhaps certain recommendations on which the Institute of Chartered Accountants does not agree, like this one, for example:


The Acting Speaker (Mr. Turner (London East)):: Order, please. I regret to interrupt the hon. member but the time allotted to him has expired.


Eldon Mattison Woolliams: Mr. Speaker, I should like, since we are continuing after the supper hour, carefully to put on the record the motion that we are debating. It is as follows:
That in the view of this House, the government should set an example to other Canadians by forthwith indicating the nature and extent of the restraints on government spending and should also introduce without further delay measures to implement the Wilson Report on the office of the Auditor General as an indication of its willingness to eliminate waste and extravagance.
I have been in the House all afternoon and have listened to the speeches made by the President of the Treasury Board (Mr. Chretien), the Leader of the Opposition (Mr. Stanfield), the hon. member for Peace River (Mr. Baldwin), the hon. member for South Shore (Mr. Crouse), and lastly the hon. member for Laurier (Mr. Leblanc), and I should like to deal in these introductory remarks with what was said by the hon. member for Laurier.
Before my leader came into the House, the hon. member was talking about our "great leader" and indicated that he was still Leader of the Opposition. I am very happy that I have the opportunity to sit on the front bench along with our leader. During the last election campaign we came out with an incomes policy, which was to be a freeze for a short period followed by a period of more flexible controls, and other monetary considerations which we felt would combat inflation.
During the election campaign my hon. friends opposite told the farmers that the Conservatives were going to control the farmers' prices. Then when they went to industrial ridings and spoke to labour they said we were going to control wages. They never discussed the two items together; they only discussed one, depending on the kind of constituency they were visiting. I believe the hon. member used the right adjective and I certainly use it in its proper sense, but this is why our great leader is sitting on this side of the House. I remind the hon. member for Laurier that it is probably better-indeed, I am sure it is better-to sit on this side of the House with our principles than be over there without any principles at all, considering what has happened during the last two weeks when hon. members opposite totally reversed themselves.
October 30, 1975

I was really amused to hear the President of the Treasury Board asking us today to give him instances of cuts that we would make in expenditures, but before I deal with that matter I should like to talk about something else that we are discussing tonight.


A. Daniel McKenzie: Why don't you ask them to listen to what you are saying? They never listen to anything.


The Acting Speaker (Mr. Turner (London East)):: Order. The hon. member for Calgary North (Mr. Wool-liams) has the floor.


Joseph-Phillippe Guay: It is his own member making all the noise over there.


A. Daniel McKenzie: You be quiet and listen.


The Acting Speaker (Mr. Turner (London East)):: Order. The hon. member for Calgary North has the floor.


Eldon Mattison Woolliams: Thank you, Mr. Speaker. The hon. member is my favourite speaker. A fellow always has to have one favourite speaker.


Joseph-Phillippe Guay: A point of order, Mr. Speaker-


The Acting Speaker (Mr. Turner (London East)):: Order. The hon. member for St. Boniface is rising on a point of order.


Joseph-Phillippe Guay: I would bring to your attention, Mr. Speaker, that it was the hon. member for Winnipeg South making all the noise, not a member on this side. We are willing to listen to the hon. member for Calgary North (Mr. Woolliams).


A. Daniel McKenzie: On the point of order, Mr. Speaker, I am not from Winnipeg South, and I think that the President of the Treasury Board should show some respect for the members of the House.


Eldon Mattison Woolliams: Mr. Speaker, I really appreciate this. Here I am arousing people and I have not really begun my remarks. The two points that we are making are straightforward. During the last 12 months the government has increased the supply of money by 15 per cent, and is continuing to do this in the binge it has been on for a long period of time. Secondly, we are suggesting a reduction in government expenditure.
I have one point I want to make at the outset. We are asking Canadians to follow certain guidelines and to accept certain restraints. In fact the Prime Minister (Mr. Trudeau) went so far as to say in Toronto, "If you are not going to do this voluntarily and accept our controls, we will have an authoritarian kind of government and force you to". Our point is that if the government is to have credibility, it must set the example, and that is really the tone of my remarks tonight.
Coming back to the speech of the President of the Treasury Board, it reminded me of a conversation that took place between an Englishman and an American who were flying from London, England, to Kennedy airport. They had not got very far out over the Atlantic when the
Government Spending
pilot came on and said, "I am sorry, ladies and gentlemen, we have lost engine number one, there will be an hour's delay". They then went along a little bit further and the pilot came on again and said, "I am sorry, ladies and gentlemen, we have lost engine number two and we will be delayed two hours". They went on for another half an hour and the pilot came on again and said, "I am sorry, there will be a really serious delay because we have just lost engine number three". The Englishman turned to the American and said, "If we lose engine number four, we are going to be a day late"!
That, of course, makes just about as much sense as the speech that the President of the Treasury Board delivered this afternoon in asking us to set out emphatically some of the cuts that we would make. He is a lawyer, and he knows that before we could produce that kind of evidence we would have to have every one of the estimates audited.
There are a few things I could say to the President of the Treasury Board. I am rather shocked to know that his government went ahead in its attempt to build a new airport in the province of Ontario and spent $100 million, without having an agreement with the provincial government.


Joseph Jacques Jean Chrétien: We had one.


Eldon Mattison Woolliams: The government then scrapped the whole project.


Joseph Jacques Jean Chrétien: We had an agreement.


Eldon Mattison Woolliams: If the government had an agreement then I have learned one fact tonight.


Joseph Jacques Jean Chrétien: We had an agreement. The government of Ontario gave its word on that.


Eldon Mattison Woolliams: If you had an agreement then you also had an obligation to carry out that agreement, which has so far cost the Canadian people $100 million.


Some hon. Members:: Oh, oh!


Eldon Mattison Woolliams: Let me make my second point, and I am now getting to the meat of this argument. If we are to find out what actually took place in respect of the Mirabel airport we will require a complete audit. I am confident that if the government hired accountants in Canada to do a complete audit of that project and gave them 50 per cent of the find, they would make the biggest treasures of their lives. I am sure of that in view of what has taken place in the building of that airport.


An hon. Member:: Hanky-panky.


Eldon Mattison Woolliams: Those are just two incidents of wasted money on the part of the government, and a person could go on and deal with incidents of the sort all night. The hon. member for Victoria (Mr. McKinnon) referred to a study in respect of national defence. He pointed that out when the President of the Treasury Board said we did not make any suggestions where cuts could be made. That study cost $11 million which was paid to two United States

October 30, 1975
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companies. The study was then shelved and has never been used. I suggest this was all done because the government wanted to delay things for two years as it had no policy at all. What did the President of the Treasury Board say when the hon. member for Victoria raised that point this afternoon? The minister said: Don't talk about peanuts; it is only $11 million. That is the attitude that runs throughout this whole government and that is why we are having this debate tonight. We say that the government should put its house in order because, if it did so, that might add credibility to its program, and Canadians would then accept the program and for nationalistic purposes carry it out.
Some years ago the Liberals hired a truth squad headed by Judy LaMarsh. I recall something that happened at a meeting during the time of that truth squad. The right hon. gentleman and member for Prince Albert (Mr. Die-fenbaker) was giving that truth squad what it deserved, and he was telling the truth about its activities. Some man at the back of the hall, incidentally in my leader's province, said, "Give them hell, John". The right hon. gentleman then replied, "When I am telling the truth about the Liberals it sounds like hell to them." That is about the truth of the situation. There is no credibility as far as this government is concerned with its ministers of today.


An hon. Member:: You are still grinning, Eldon.


Eldon Mattison Woolliams: I suggest that you should stop
dreaming.


An hon. Member:: Shame!


Eldon Mattison Woolliams: It is a shame, all right; it is a damn shame. The truth is that the government has been on an economic binge for the past seven years. The departments of government actually run this government. The President of the Treasury Board is a friend of mine, I hope, but I wonder about the experience of that man who now holds one of the most important jobs in this country. I may be wrong, and I hope I am, but I doubt that before he entered the House of Commons as a young man he had ever met with his banker to make sure he had enough capital in an enterprise to meet a payroll or to avoid going bankrupt, yet today he is the President of the Treasury Board and talks about credibility. We say there is no credibility, yet this minister is helping to run the biggest business in this nation.
The government is spending $32 billion this year. The hon. member for Peace River (Mr. Baldwin) pointed out that there would be a deficit of something in the order of $3 billion. I suggest it is likely to be closer to $7.7 billion. Every budgetary prediction I have heard since the Liberals came back to office in 1965 has been out by 50 per cent to 100 per cent. The Liberals were never very good at predicting anything. They have been on a binge ever since the Pearson government and throughout the Trudeau government.


Joseph Jacques Jean Chrétien: You should remember the budget of 1959-60.


An hon. Member:: They don't want to remember that.


Eldon Mattison Woolliams: I would ask what experience the present Minister of Transport (Mr. Lang) has had in his

new field? He was the dean of a faculty at the Saskatchewan university. This was a respectable academic who became the Minister of Justice. Now he is the Minister of Transport. Does he really have the business experience necessary to analyze transportation problems?


An hon. Member:: Oh, come on.


Eldon Mattison Woolliams: I am coming on, and I will come on a lot stronger. I wish you would listen to me.


An hon. Member:: Will you be louder, too?


Some hon. Members:: Oh, oh!


Eldon Mattison Woolliams: I wish you would listen. Does this minister have the experience required to analyze the facts?


Some hon. Members:: Hear, hear!


Eldon Mattison Woolliams: You can shout loud and I will still answer; you do not have to worry about that. I always know when I am bothering the Grits' conscience by the noise they make. Have these ministers the experience to analyze the facts given them by the civil servants who basically run the government? These senior civil servants have just received a big increase in salary, up to $6,000 a year. That certainly is an example of the government's restraint.


An hon. Member:: Some restraint.


Eldon Mattison Woolliams: Have any of these ministers had the experience before they came to the House which would enable them to accept the responsibilities they now hold? They may all be academics, and I would not question the marks they got at their universities, but do they have the business experience to run the government? I suggest they do not, and that is the reason why we are today facing such economic chaos.


Joseph Jacques Jean Chrétien: I am a lawyer like you, Eldon.


Eldon Mattison Woolliams: I listened to the hon. member for Lauri-er (Mr. Leblanc), the President of the Treasury Board, and other Liberals today talk about uncontrollable expenses. These are the people who started these grandiose assistance plans.


Joseph Jacques Jean Chrétien: You voted for them.


Eldon Mattison Woolliams: There are several I did not vote for. This government started these grandiose plans. Let us refer back to the debate on medicare. The Hall report pointed out that this grandiose scheme would cost the Canadian people approximately $600 million. Mr. Hall also stated that if the government did certain things it wanted to do, the plan could cost $2 billion.
When I pointed out these facts to the government at the time of the debate I was told that we should not worry about the expense because everyone was in favour of some kind of health coverage. The government went ahead with this grandiose plan.
The same thing happened in respect of the unemployment insurance fund. I remember in 1962 when the opposition abused the right hon. gentleman from Prince Albert and his government for spending $300 million in one year more than was collected from the fund. Today the govern-
October 30, 1975

ment is spending about $3.5 billion, and more likely $4 billion. In addition, the rate of contribution on the part of employers and employees has more than doubled. This is no longer an insurance plan but a grandiose scheme brought in by the Liberals, who are now paying for their sins.
When votes cease to be important they will no longer be bought by the Grits, and that boils down the present situation. This government has presented these schemes without any thought about administration, without the basis of any business experience, and is now faced with uncontrollable costs. This government cannot even control the costs that are controllable. Spending by this government is now out of hand. This government's philosophy is to spend, spend, spend; and tax, tax, tax. The philosophy of this government today is not to tax the people for services but to tax the people because the Liberals think it is right that they should be taxed. The quantum that is paid does not matter. They will pay either from their income or their profits. That is then passed on to the consumer. It becomes a vicious circle. This is what created the economic mess we are in today.
That is an example of the credibility we are talking about when we ask the government to cut down the extravagance now and set aside some of its ideas about grandiose schemes. The government should cut down on those expenses which are still controllable. I know one thing-the President of the Treasury Board has never read a speech of mine in which I asked the government to spend more. We are not saying the government should cut out all expenses. We are saying, however, that it should spend the taxpayers' money wisely with proper constraint.


Mr. Harquail:: I rise on a point of order, Mr. Speaker. I was under the impression that today is an opposition day. I am wondering where the members of the official opposition are. I see about six Conservatives in the House. I am wondering where the Conservatives are today.


The Acting Speaker (Mr. Turner (London East)):: Order please.


Steve Eugene Paproski: On a point of privilege, Mr. Speaker, may I say that I detest that type of statement from a new member in this chamber when other members are attending committee meetings. I think that it is a shame that a new member should make such a statement.


The Acting Speaker (Mr. Turner (London East)):: Many members of this House serve on committees. I suggest that the hon. member for Calgary North (Mr. Wool-liams) carry on.


Eldon Mattison Woolliams: Thank you very much. I have never had so much help when making a speech and I appreciate the support I am getting. However, I should like to answer that. There is one thing that has been said in this House which bears repeating for the benefit of a new member. When one goes out big-game hunting one does not follow rabbit tracks.


Maurice James Harquail: Who is the rabbit?
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An hon. Member:: You are. You have a lot to learn, sonny.


Eldon Mattison Woolliams: We ask the government what the deficit will be. We predict that it will be more than $7,000,000,000. It might be up to $8,000,000,000. The government will not, as the hon. member for Peace River has said, bring in its supplementary estimates until it has attempted to get its anti-inflation program rammed through the committee by the 11th or 12th of November. That is where our members are at the present time. They are fighting a battle for the taxpayers.


The Acting Speaker (Mr. Turner (London East)):: Order, please. I regret to interrupt the hon. member, but the time allotted to him has expired. The hon. member for Saskatoon-Biggar.


Eldon Mattison Woolliams: How much time have I had, Mr. Speaker? I started at 8:30.


The Acting Speaker (Mr. Turner (London East)):: You
are allotted 20 minutes, sir, and have spoken for 20 minutes.


Mr. Ray Hnatyshyn (Saskatoon-Biggar):: Mr. Speaker, I rise with some modest trepidation after the wonderful and perceptive speech given by my hon. friend and colleague from Calgary North. I feel that anything I may add will be a little anti-climatic. On the other hand I do wish to make a contribution to this particular debate. I wish to voice some concerns and opinions I have with respect to the government's policy concerning the whole question of spending, and lack of control and restraint in that area.
One of the features of the so-called program of the government to fight inflation as represented by the white paper tabled in the House by the Minister of Finance (Mr. Macdonald) is an obvious lack of enthusiasm with respect to any sort of meaningful policy of restraint in the area of government expenditures.
Some three pages of the white paper are devoted to government expenditure policies largely for the purpose of justifying the increase in government spending and the present level of expenditure. There is an admission that federal government expenditures have risen at a greater rate than that at which the economy has grown, but then it is pointed out that the rising trend has not been unique to the federal level of government, and that a very large proportion of federal government expenditure is under the statutory programs and other arrangements where there is little flexibility.
The bankruptcy of initiative in this most important area of restraint, if we are to have any realistic program to control inflation, as confirmed by the statement made by the Minister of Finance that there is little scope for the government to reduce expenditures. All I can say to that type of approach is that there is a certain touch of lunacy in the proposition when on the one hand the government is attempting to introduce severe limitations on the working men and women of this country, many of whom can scarcely afford the basic necessities of life, and on the other hand it adopts a rather cavalier approach to any suggestion of restraint on its own expenditures.

October 30, 1975
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The Prime Minister (Mr. Trudeau) and members of the cabinet have started to criss-cross the country in some sort of crusade to convince Canadians that they must co-operate with the policy of controls imposed on them by the government. There is no question that they have a very big job on their hands to establish the credibility of this program, when one looks back at the history of vehement attacks made by the Prime Minister and his colleagues against any suggestion of price and incomes control. But having come round a full 180 degrees in their attitude, and having then embraced a policy of long-term controls on prices and wages, they in effect grant themselves an exemption from restraint.
The Prime Minister keeps telling us that the people of Canada have been calling for leadership in economic matters and that this is the reason why the new program has been put into place. He apparently does not understand that part of this leadership that the people of the country are looking for is restraint and responsibility in that area in which the government has direct control, which is the area of government spending. But let us put the matter of government spending into perspective.
In the first place, one does not have to be an economist or even a close observer of government affairs to see that spending in government has gone virtually out of control. Between 1973 and 1974 federal government expenditures increased from $22,402 million to $28,715 million, a spending increase of $6,313 million in one year. The amount of this spending increase is greater than the total of federal government expenditures for 1958, which was $6,176 million. If all federal government expenditures during the first 77 years of confederation were added together, the total amount of $27,806 million would be less than what the federal government spent during the last fiscal year.
From 1867 to 1974 federal government expenditures have increased 209,247.6 per cent. Federal government expenditures in 1974 were twice the size they were in 1969, nearly three times the amount spent in 1961, and over 12 times the 1950 level. If expenditures were to continue to grow at the rate achieved between 1973 and 1974 they would double in less than three years.
From 1969 to 1974 the general price level in the economy increased something in the vicinity of 44 per cent. Prices paid by consumers increased by 34 per cent, and prices for imports by some 43 per cent. At the same time prices paid by governments increased by some 50 per cent or 51 per cent, which indicates that the government has been more tolerant of price increases than any other sector and has contributed more to inflation than any other sector.
In 1974 federal government expenditure represented a daily spending of something in the vicinity of $78.7 million; and in terms of hours and minutes this works out to 3.3 million every hour, $54,600 per minute, or $910.50 per second. This is more than a cash flow; it is a cash flood.
With respect to the size of the civil service, in 1970 there was one federal civil servant for every 78 Canadians. In 1974 that ratio was reduced to one civil servant for every 67 Canadians.
Finally, on an average basis every Canadian man, woman, and child paid $1.06 per day in personal taxes to
| Mr. Hnatyshyn.)
the federal government in 1970. In 1974 every Canadian paid an average of $2.08 per day in federal income tax.
With this history of almost mind boggling growth in government expenditures, it is inconceivable to me that the government can simply brush off any fundamental re-examination of its own spending habits.
The Attack on Inflation Paper takes some pains in trying to show that government expenditures cannot be reduced, or their growth even significantly moderated without adversely affecting transfer payments, aid programs, and the level of service to the public. Such a view ignores the question of whether a cutback in government programs may be necessary to achieve the more important goal of moderating inflation. Since inflation disrupts government programs it may be necessary to reduce the level of service in order to maintain service in an orderly manner.
The idea put forward in this white paper that growth in government expenditures cannot be moderated is, I suggest, unsatisfactory and far from conclusive. What the government has in mind in connection with moderating expenditures is a good question, and the answer is virtually nothing of consequence.
If one reviews the points raised by the Minister of Finance in this paper, trying to determine in what areas the government intends to make a reduction in expenditures, one comes up with the conclusion, I am afraid, that it is not going to have very much success, or that it is not very interested in that final result.
The reduction of federal employment growth to 1.5 per cent still will allow increasing of the federal public service by more than 5,000. However, the statement concerning the reduction in the rate of growth of federal employment is immediately qualified by a reference to the necessity to accommodate additional personnel required in connection with the implementation of the wage and price control program and other so-called essential services.
During the course of debate the Minister of Finance has indicated that he anticipates a complement of something in the vicinity of 200 persons in connection with the anti-inflation review board's activities. With the propensity of the government to use Parkinson's law as the basis of its employment policies and projections, I can well imagine that this will merely be a springboard figure for this particular body.
The government is committed to a program of controls on every segment of our society, and the Prime Minister has made his intentions abundantly clear in this connection. It appears more and more certain that before too long the government will be obliged to take whatever steps are necessary to ensure that this program is made applicable to everyone in Canada, as opposed to the selected groups and individuals now referred to in the legislation before us these days. We seem to be grinding on toward the most massive intervention into the affairs of individual citizens we have experienced in our country at any time, except possibly during war time, and the administration required to put this program into place will, therefore, also be required to be massive. This administrative nightmare will involve an extraordinary demand for personnel, and I anticipate that this in turn will cause extraordinary pres-
October 30, 1975

sure against any meaningful reduction in the growth of the public service.
When this additional personnel is added to the additional workload to be placed on existing government departments, the pressure on those departments affected to increase personnel will also be very great. The Minister of Finance, in response to questions concerning the operation of the control plan, has said that the process of policing increased salaries and profits will be affected through the existing tax collection department. He indicated that the Department of National Revenue has done a very good job in the matter of taxation of income, and he intimated that this department would therefore be involved in the process of monitoring and policing excessive wage and profit increases.
As I have stated there will, therefore, be that kind of additional pressure put on existing departments, and one can almost guarantee that the projected limitation on increasing the civil service will not be met by virtue of the wage and price control program alone. I see the Minister of National Revenue (Mr. Cullen) talking to the President of the Treasury Board (Mr. Chretien), and there is no doubt in my mind that he is already asking for more help in policing this program.
What are we left with in regard to a reduction of expenditures? The whole thrust of the supposed reductions leaves us with the pathetic proposition that the government will limit the normal replacement of office furniture, the use of first class travel by air, and suspend normal schedules for replacement of departmental automobiles. Will anyone in this country take seriously the resolve of the government to give leadership in the area of restraint with these preposterously insufficient measures?
I want to discuss the matter of first class travel because it is of interest to me. On July 10 of this year I asked the government for statistics for 1973, 1974, and to the end of June, 1975, with respect to air flights taken by public servants through the Canadian government central travel service and the number and value of first class flights. The answer received from the Minister of Supply and Services (Mr. Goyer) indicated a total number of air flights for 1973 of 104,100. In 1974 this went up to 153,795 and there were 94,146 to the end of June of this year. The total dollar value of all flights was $16,099,290 for 1973; $24,847,415 in 1974, and $16,037,950 to the end of June of 1975.
However, the minister did not answer the question about how many of those flights were first class or what the dollar value of first class was because, as he stated, records of first class flights taken were not maintained by the government or its agency. How then was the government able to determine in the first place what savings it would make by prohibiting first class air travel? And in any event, assuming the government cut out all travel, there would hardly be a dent in the total and complete budget of this country. However, if we take only that portion which we have to guess at with regard to first class-and perhaps the reason we are not getting that information is that there was an excessive amount of that kind of travel in the first place-I do not understand exactly why the government has made such a big issue about air travel and the reduction of air travel. It is simply a cosmetic or tokenism type of approach to the reduction of expenditure.
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Finally, of course, with air travel a good portion of this money will be going to Air Canada, a Crown corporation, which will receive the benefit of these travels by civil servants.
I understand that even the rank and file Liberal member of parliament is anxious that there be restraint in government spending as a tangible example to the country, if we are to believe what is quoted in the press.
In the Toronto Star of October 14, 1975, an article appears, headed "Liberal MPs offer to give up Raise". The article goes on to say:
Liberal MPs last night indicated they are prepared to forgo a 7 per cent cost of living increase as an example to the country.
Prime Minister Pierre Trudeau mentioned the cost of living adjustment to the MPs is due on January 1 when he briefed the Liberal caucus last night on the government's anti-inflation program-
Trudeau, who told the MPs they were faced with a difficult decision was greeted with cries of "Wipe it out" and "Let's drop it now".
This attitude amongst the supporters of the government is a hopeful sign. However, when one considers that the Prime Minister, on the immediately preceeding Friday announced the appointment of no less than 27 parliamentary secretaries who get something like $5,300 extra per year, the enthusiasm of the caucus may be due to the fact that most of the members of that caucus have now been given jobs under which they receive substantial additional moneys.
Finally the "Attack on Inflation" paper indicates that the President of the Treasury Board will also require the re-imposition of the 10 per cent reduction in travel expenditures and expenditures on consultants. I should like to make some comment regarding consultants. The Liberal government has increasingly resorted to the use of outside consultants in the preparation of working papers, policy formulation, and studies in general. Many of these studies and analyses could have been readily carried out by the respective branches of the various departments. However, the government has repeatedly shelved this approach.
Many of the projects presently being undertaken by consultants are questionable, as are the credentials and validity of some of the consulting firms. Undoubtedly the patronage principle has been utilized to the utmost by the government in relation to some of these consulting firms.
A severe reduction in the use of consultants at this time should be seriously examined in the fight against inflation. The utilization of consulting services should be kept to an absolute minimum. Instead the government should fully utilize the services and resources afforded by the trained personnel of the various government departments. Such a move will not only help to check inflation but will also strengthen morale within the echelons of the civil service, a morale which has been continually down-graded with the acquisition of power by the Trudeau government.
Because of the way in which the government has presented its information on consultants it would appear to be impossible to discover just how much the government is spending on consultants each year. The figures for consultants are included in the figures for professional and special services. An indication, however, can be gained from some information which we have.

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Government Spending


The Acting Speaker (Mr. Turner (London East)):: Order, please. I regret to interrupt the hon. member but his time has expired.


Ramon John Hnatyshyn: On a point of order, Mr. Speaker, when I was interrupted I was just noticing the time and-


The Acting Speaker (Mr. Turner (London East)):: Order, please. The hon. member's time has expired. The hon. member for Cape Breton-East Richmond (Mr. Hogan).


Mr. Andy Hogan (Cape Breton-East Richmond):: Mr. Speaker, the Liberals are fond of telling Canadians that they are good administrators, that in fact only they are capable of running this country.
My experience and observations are that the Liberals may be pretty good in dealing with cultural matters such as Canadian unity, and I guess that is because of the historic relationship of the Liberal Party with Quebec, but when it comes to the economy they just cannot cope.


Joseph-Phillippe Guay: Ask him why he left the church.


Andrew Hogan: You keep the church out of that, Joe. You should have more sense than to introduce it.
When it comes to inflation they admitted until recently they were powerless to deal with it, blaming it all on international forces. They should have stuck with that line. What has been proposed now, wage control, has been almost universally dismissed as the wrong solution to the problems facing the Canadian economy today.
Seeing the Liberals floundering so badly in trying to solve the country's economic problems, we in the New Democratic Party produced a number of suggestions for useful measures which could be brought in to reduce inflation and to temper its effects, for example, a selective price controls and prices review board with teeth in it; measures like public assembly of land for housing to eliminate the speculative factor that is driving up housing costs; projects like orderly public development of our energy resources to ensure that we have a constant and reasonably priced supply; a two price system on selected commodities, although they seem to have adopted that one in the anti-inflation legislation. But the Liberals generally refuse to take sensible measures seriously. Instead they are subject to the wildest of notions on how to control inflation. For example, reading in the financial pages that it is imperative to cut down on government spending in order to control inflation, they seem to respond uncritically.
Look how they do it. We read in the June budget that some $800 million is to be saved by cutting the budgets of federal government departments. What programs in what departments are being sacrificed? There is no indication in the budget that any thought was given to priorities in government spending. Instead we were treated in some cases to hysterical strokes of the pen.
Take the small crafts and harbours expenditures. Over the last ten years the government managed to bring expenditures for small crafts and harbours, which affect so many small communities on the west coast and the east coast, from $12 million to $30 million. In the June budget

this year the then minister of finance took $10 million away and the government let him do it despite the fact that so many small fishing communities will suffer terribly as a result. They will suffer not only because of the multiplier effect of that money being taken out of local economies but because they will not have the means, such as harbours and so on, to improve their productive capacity and help supply some of the protein that Canada and the world needs. The people in all those villages on the west coast and on the east coast lost $10 million on that deal, and the cabinet approved it.
Again, finding that due to continuing high unemployment rates more government money is being spent on unemployment insurance than originally predicted, they contrive to shift the cost of UIC away from the federal government to the employers and workers. They accomplish this by increasing the payroll tax and the premiums paid by those who are working and by their employers. This scheme will save the federal government hundreds of millions of dollars, but it will also remove an important incentive for keeping unemployment rates low. But unemployment of 7 per cent to 8 per cent does not seem to worry the cabinet.
Not only are the results of some of this policy of slashing government spending socially odious such as I mentioned in regard to the small crafts and harbours case, but the thinking behind the policy is misguided. I say that because in the first quarter of 1975 the public sector spent some $4 billion in gross fixed capital formation. In comparison, the private sector spent over five times as much- $21 billion.
If one is concerned about spending and ensuring that the investment which occurs in the economy is of the type which produces the goods and services we need and not simply contributes to great inflation, then it makes more sense to ensure that spending in the private sector increases so that we can achieve public interest goals.
Cutting necessary public spending on the pretext of fighting inflation may be damaging. For example, let me refer to something that happened before the last federal election. Just before the election the Department of National Health and Welfare published a document which was to be a new perspective on the health of Canadians. The report emphasized that if we were to improve our health standards we must spend more money and devote more resources to preventive medicine, rather than trying to repair the damage at the last minute, long after it has been done. That sounds like a sensible approach, does it not? In other words, don't wait until the man is half dead from lung cancer, from breathing asbestos fibres, or coal dust every day at work, and then try to lengthen his life with surgery. Make an early diagnosis of his condition by using social devices, such as community health centres which are stuffed to provide the service. Treat him, and remove the source of the polluted air.
I point out that the federal government did not come up with this as an original idea. New Democratic Party provinces, particularly Saskatchewan, have long said to the federal Liberals that Canadians need more health facilities, not less, and that it costs less in the long run to catch disease at an early stage and treat it in health centres or
October 30, 1975

convalescent homes where costs per bed are not as high as in acute treatment hospitals. Although these programs are expensive to implement at the beginning, there are savings in terms of lives as well as dollars.
We argue in favour of necessary government spending, but this is not to say that one cannot point at blatant examples of waste and misuse of funds at the federal and provincial levels. Again and again the Liberals allow themselves to be taken in by sharp operators. It is a wonder that any self-respecting businessman can have any respect for the federal government, as it seems to be so lacking in business sense. Consider, for example, the case of Microsystems. The government invested $36.7 million in this company, receiving no equity in the company nor any appointments to the board of directors. The company has been liquidated under unusual circumstances, with the government losing at least $30 million of its investment. And what has the government done? Nothing.
Consider also the aircraft industry. During the next few months the government will consider purchasing $3 billion worth of aircraft for the military. At present $47 million worth of CF-5s are in storage, presumably because the aircraft are not suitable for use. We are not assured that the new purchases the government intends to make will be useful either, especially as they are being linked to the offers of several multinational aircraft companies to rationalize the Canadian aircraft industry. They intend to do this by generously taking over all the money the government has invested in the industry by way of grants and loans. They intend to produce a line of aircraft which are suitable for the international marketing demands of the company involved, but not to the needs of the Department of National Defence. I hope the Prime Minister (Mr. Trudeau) will look into this and stop that nonsense before it goes any further.
Thirdly, consider housing. We are told that the government is to propose new housing measures soon, as part of the control program. We heard much about housing during the last election campaign, but what did the proposals for housing achieve? As any economist will tell you, the government increased the demand for housing, but not the supply. The result is that house prices in Canada are so high that most, whether they live in Toronto, or Montreal, or Halifax, various areas of the Maritimes, or St. John's, Newfoundland, cannot afford a house. The Liberals will probably want to give the private sector more incentive for building houses. This past spring they introduced amendments to the National Housing Act to provide more subsidies to builders of rental housing. The results are neglibible. Apartment starts are still low and the increasing demand from tenants and from provinces for effective rent control shows just how serious the supply problem remains.
In the November, 1974 budget, doctors and lawyers were given a tax break, to encourage them to invest in rental housing. But we have seen nothing significant in the way of new starts. In addition, the government estimated that it would lose $20 million in taxes, both personal and corporate, by virtue of this tax break. That amount is almost double the federal government's 1974 contribution of $13 million to senior citizens' housing, and less than the $18.9 million paid in subsidies for federal-provincial rental housing in that same year.
Government Spending
An hon. member mentioned Mirabel, and one immediately thinks of allegations of corruption in connection with the airport. I say this to draw attention to the unbelievable amounts of money that were spent on consultant services and feasibility studies in connection with Mirabel. On July 15 the hon. member for Central Nova (Mr. McKay) put on the order paper a question concerning consulting fees and feasibility studies with respect to Mirabel. I do not want to be accused of bringing this matter up from racist motives-we heard accusations to that effect last year. No, I am bringing the matter up simply because it is an example of government waste. The answer to the hon. member's question indicated that since 1968 the Department of Transport has awarded 105 contracts for consulting services and feasibility studies for the Mirable airport, and that the total amount of money involved is $41,022,658.34. Surely even the most died in the wool Grit will admit that there is something drastically wrong. No wonder we shall see all kinds of investigations concerning contracts awarded in connection with Mirabel.
In conclusion I wish to say that in a mixed economy such as ours, the government has a most important role to play. I suggest that the government's anti-inflation bill is essentially a wage control program. Hopefully it will be amended so that working people of this country can be convinced that the government wants to control prices as well. At present we are sure merely that it is a wage control program. Broadcasting on the night of October 13, the Prime Minister said we are all trying to take too much out of the economy and that the people must reduce consumption. But consumption accounts for about 60 per cent of our gross national product. If you cut consumption and reduce government spending, you are relying on the other two sectors of the economy to prevent unemployment from rising to 9 per cent or 10 per cent while you look for lower prices. You are relying on business sector spending, and on export sector spending.
We know that business sector spending will probably remain high. The Minister of Industry, Trade and Commerce (Mr. Jamieson) said in so many words that although the government will control dividends for the first year of the program it will not disapprove unduly if profits are ploughed back into the company. I suggest that we need not worry about the capital accumulation of such companies; accumulation will continue, despite the antiinflation program. In a way that is healthy. We do not want the private capital formation to go too low. Nevertheless it may be that what the government is finally depending upon is the growth of the American and other economies, so that the export sector will carry us along while the consumption and government sector is being used to dampen the economy in order to fight a one sided fight against inflation and hope that unemployment will not rise. However, it is bound to rise. I suggest it will go to 8 per cent this winter. Unless there are radical changes in the government's policy in the next six months, 8 per cent to 9 per cent will be typical next year.
Some people get tired of hearing me talk of unemployment. It is not just that I come from a part of the Atlantic region where we are used to being the poor cousins in confederation. At the present time it is not only the

October 30, 1975
Government Spending
unskilled workers who will feel the brunt of unemployment in Canada. Tuesday's Globe and Mail quoted Dr. John Sheppard, Executive Director, Science Council of Canada, as saying:
People with Ph.D.'s in science are no strangers to unemployment and a federal anti-inflation program will make their job situation worse-
We are, therefor^, in a typical boom and bust cycle which is unfair to the student, hideously wasteful to the taxpayer and damaging to our potential as a technology-based nation. There are at present about 1,700 surplus Ph.D.'s in Canada and the education of each has cost taxpayers $50,000. It's time for industry, the federal Manpower Department and the universities to get together and begin planning for future job market needs.
It is time that the government and the progressive elements in the cabinet paid more than lip service to the word planning, making it a more meaningful project for all Canadians, especially those who live in the shadow of regional disparity from the beginning to the end of their lives. Indeed, this government on its spending policy and other policies needs to stop confusing the people and must begin to give us acceptable and competent management of our economy.


Mr. Serge Joyal (Maisonneuve-Rosemont):: Madam Speaker, I am glad to take part in the debate and to go on with the debate on the basis on which the hon. member for South Shore (Mr. Crouse), the chairman of the Standing Committee on Public Accounts, has carried on with the debate this afternoon.
I should like to take this opportunity to point out the outstanding work he is doing as chairman of this committee which, as I will show later, has a very special place within our parliamentary system, and also the great tact, the cleverness, the spirit of neutrality and impartiality with which he presides over the destinies of this committee.
Indeed, since the start of the 30th Parliament, the committee has tabled three reports in the House, the fourth is now being revised and doubtless we will manage to discharge our responsibilities in the time allotted to us.
Still, Madam Speaker, I have a few remarks to make at this time which all parties may not find pleasing. Since I have had the opportunity of participating in the proceedings of the Committee on Public Accounts, I have noticed that one party in the House has never sent any of its members to its meetings. I am speaking of the Social Credit party of Canada. I regret it all the more as when we have debates such as those held today, those hon. members are often the most eager to rise and criticize the government on the way it manages its programs, on the fact that budgets are not high enough, and on the fact that there is a shameless waste of public funds.
It is very easy, Madam Speaker, on an opposition day, to come to the House and cry before the press and the public that the government spends too much on local initiatives projects, that its national defence programs are ill used, that it spends too much on office supplies. Now, when the Committee on Miscellaneous Estimates is sitting or when the Auditor General's report is tabled in the House, it so happens that those members are not attending. Even if we give them notice of those sittings, they never come to discuss spendings where decisions are really made.

I regret, Madam Speaker, to have to say that there is another party in the House which very rarely takes part in the proceedings of the public accounts committee. It is the New Democratic Party. I regret it all the more, because some members of this party are among those who attend the House most regularly, and who best know the procedure of Parliament. But why, when it comes to control government expenditures or to discuss the Auditor General's report, is this party not represented on the public accounts committee.
I think the first responsibility we have as members of Parliament is of course to be in the House on opposition days, but even more to be present in committees when decisions are made. This is the first remark I wanted to make, and I regret having to do it because I have always tried to place my speeches in this House on parameters of neutrality. I would not want my next remarks about the very nature of this Committee on Public Accounts to smack of partisanship. I think, Madam Speaker, that I had to report to the House that this committee suffers from poor attendance and that the political parties who delegate members to this committee should ensure that they have as many seats as are allowed under the rules.
The second remark I should like to make, Madam Speaker, concerns the politicization of the role of the Auditor General of Canada. Since Mr. James Macdonell was appointed Auditor General, we have witnessed a complete reversal in the attitude and the sense of responsibility of the Auditor General. His predecesssor saw fit to taint his actions with political overtones in order to be efficient. The present Auditor, on the other hand, found it more effective to carry out his responsibilities in a more professional way, more consistent with the principles of public accounting than his predecessor.
Madam Speaker, when Mr. Macdonell was appointed Auditor General of Canada, his first task was to establish an independent committee to review the functions, powers and role of the Auditor General of Canada, and especially the way Parliament is carrying out its duty to control public spending. This committee sat and presented a report; members of parliament have had the opportunity to read it and the President of the Treasury Board (Mr. Chretien) informed us this afternoon that there is now a bill being drafted and that next session we would likely be able to discuss and adopt it. That is positive action. The minister did not limit himself to being guest speaker at dinners of social or philanthropic clubs across the country. I prefer an official who has the sense of responsibility and takes immediate action to improve the system. I do not believe it is necessary to limit oneself or that the Auditor General of Canada has a calling to attend every dinner conference across Canada to denounce government extravagances.
On taking office, the Auditor General of Canada realized that until 1962 when the Glassco Commission settled down to the task, there had never been a comprehensive review of the government's administration. He did not fuss about it, did not call at the Canadian Club or at the Rotary Club, he simply made the decision to contact the Public Service Commission Chairman and ask him if he would participate in the exchange program with private
October 30, 1975

industry. This resulted in the hiring of 32 accountants representing the largest chartered accountants firms in the country whose responsibilities would be to review completely the financial performance and the administrative controls of the government.
Madam Speaker, that work lasted a year. It resulted in the publication of a 500-page report which the government ministers have received and which will be tabled at the same time as the yearly report from the Auditor General of Canada, that is in early December. This report reviews the administrative performance of 28 government departments.
It is useless for me, Madam Speaker, to list the 28 government departments. However, I can assure you that another task force made up of 28 accountants from the private sector is presently investigating the administration of Crown agencies. When the Auditor General presents his next report, we will be able to see how the Crown agencies are administered and how the public funds are spent within those agencies.
Of course, Madam Speaker, 500-page report on government management tabled in the House may seem voluminous. Let me only mention that his review deals especially with budget preparation and control.
Madam Speaker, since your election, you had the opportunity, as I had, to receive what we call the blue book. Who in the House can make an efficient and intelligent use of that blue book? The manner in which government expenditures are presently recorded in this book makes it impossible for members of the House to use it.
It was essential that a group of qualified people examine the way the expenses are reported an accounted for, as well as the way the government allocates the various funds within the programs. I believe, Madam Speaker, that the first objective of the study conducted by the Auditor General was precisely to strengthen the control of the House over government spending.
As previously mentioned, Madam Speaker, I think it is much more difficult to criticize the way the blue book is drafted than to give dinner speeches across Canada.
The second element of the study conducted by the Auditor General was the financial reporting systems. We know for a fact that deparments and Crown agencies must submit interim reports periodically on the progress and amount of government revenue and expenses. Again the Auditor General has directed that a study be conducted which will allow us to scrutinize public spending more closely and more directly. He has also directed that this study include financial control of government expenses and income, assets and liabilities.
Then again, Madam Speaker, it is one of the essential tools available to both sides of the House to make sure that the expenditures are consistent with the purpose of the legislation passed in the House. Of course, are also included all aspects of the internal auditing, staffing and the flow charts of all departments. That 500-page study will be summarized in a 125-page document, and all the responsible ministers will have the opportunity to appear before the Standing Committee on Public Accounts and to answer for the comments reported in the Auditor General's report and in that study which I just mentioned.
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I think that thanks to the sense of responsibility of the present Auditor General of Canada and the manner in which he views his duties, we can be sure that the administrative and miscellaneous government expenditures are properly scrutinized. And I am sure that all members who have attended the meetings of the Standing Committee on Public Accounts since the beginning of the 30th Parliament, readily acknowledged that the present Auditor General will be the most outstanding incumbent of that office.
And this explains why Mr. Wilson who attended the annual Auditor General conference last September mentioned that most of his recommendations could be almost readily accepted by the government and the Auditor General.
My colleague, the chairman of the Standing Committee on Public Accounts, said this afternoon that many of those recommendations could be adopted and implemented and would not require any new legislation. And at least nine of these recommendations have already resulted in initiatives and action from the Office of the Auditor General.
I believe, Madam Speaker, that the way the situation evolved since about a year ago is somewhat reassuring at least as far as administrative controls are concerned. I think that if we have to be accountable for something, it is more or less for the way the Standing Committee on Public Accounts is operating. And this is why I wish to draw your attention on the way this committee has changed in recent years.
I think that the Public Accounts Committee has a special role to play, a special job to do. It does not hold discussions nor does it get its orders directly from the government. It is not a committee which deals with bills or has work of an irregular nature to do. The terms of reference of this committee are closely related to the daily administrative chores of the government. Consequently, I think that the nature of that committee and its functions should encourage us to change its approach entirely. It is a committee which has a near judicial status, that is to say with a membership that should never submit to individual party lines or show political bias. And I said before that the chairman of the committee, since he has been appointed to that office, has tried to conduct the debates without reference to the political options represented by everyone in this House.
I think that the members of the committee should first attend the meetings and then stay on the committee for more than the duration of a session. In fact, as in the case of a court, a judicial institution, just like the judges, its members should not be affected by political pressures or have terms of office too short to let them fulfill their functions satisfactorily.
Consequently, the first amendment that should be made would be to set the Public Accounts Committee on a permanent basis. This committee should sit as long as required by its work and as long as the report of the Auditor General and the financial statements of the government have not been discussed at length. Moreover, the members of this committee should be appointed for at least four years and should not be changed except under exceptional circumstances. Also, the committee's calendar should not necessarily coincide with that of the session of the House. During a fiscal year, the House might sit for

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Government Spending
only six months while the committee should be able to meet over a period of at least eight months to be able to implement the recommendations and carry out the mandates specified in the Auditor General's report.
I believe, Madam Speaker, that it would be appropriate to amend the rules of the House so that the report of the Auditor General of Canada could be automatically referred to this committee as soon as it is tabled, whether or not Parliament is sitting. I also believe that one of the duties of this committee should be to ensure that the recommendations can be immediately implemented by the government.
Indeed, it is useless to have allotted days like this one where any member may stand up and say either that the government is spending too much or is not spending enough, or even that it is spending just enough. It is absolutely useless to have such debates. I believe that if we want to be efficient, we should instead, as concerns the 33 paragraphs of the Auditor General's Report which did not bring about any change in our administrative procedure, ask each minister responsible for these paragraphs why no action was taken within his or her department to implement the recommendations made by the Auditor General. This would seem much more positive, more effective and more in line with the interest of Canadians. This would be better than simply pointing out the construction of a pool, the purchase of two cars, whether they be Cadillacs or Volkwagens, or exaggerated expenses for the fitting of an aircraft carrier or something else.
A Cadillac does not mean much in a $14 million budget. The important is that the administration that has made such a decision should follow the correct procedure and the instructions given by the controlling authorities within the department making the purchase. Once the ticket is bought, once the expense has been made, it is all very well to come and say: the government spent too much. It is much more demanding before making the expense to control the decision which was taken when the budgetary estimate was made.
Has anyone in this House questioned the estimates of the Department of Supply and Services when the money to be spent on that car was accounted for? Not one member of this House pointed out that an item in the estimates should have been deleted. And yet, once the money is spent, they are shocked and they make of it a matter of nationwide proportions. Madam Speaker, it is not an indication of departmental or public responsibility to question after the fact decisions one has been partly responsible for through one's silence and submissiveness.
Madam Speaker, if we are to amend our procedure, I think we should do so at the decision-making level before expenses are actually effected. Madam Speaker, if the Committee on Public Accounts is to prove useful, I think its report should not be tabled in this House when its sittings are completed and remain a dead letter. We should in fact discuss the third report of the Committee on Public Accounts, which was tabled in the House in March and was never debated by opposition members. No one ever requested the minister mentioned in one of those recommendations to appear in this House. Madam Speaker, if opposition days are to serve some purpose, they should be used to improve the administrative procedures and the

manner in which financial controls are exercised within departments.
It is utopian to believe that a minister today controls every decision made-in his department. Quite often the minister does not know how the expenses provided for in the estimates are effected. Only after the fact is the general public informed that such or such expense was carried out according to the budgetary estimates passed by this House.
I think, Madam Speaker, that one of the major amendments this House and the opposition should suggest-and I do not think there is any objection on this side of the House-would be precisely to use one of the opposition days to implement the recommendations in the report of the Auditor General which have not already prompted changes and amendments from the departments concerned.
I think, Madam Speaker, we already made a step in that direction: 55 paragraphs of last year's report of the Auditor General have already given rise to changes and amendments. The President of the Treasury Board (Mr. Chretien) wrote to the Auditor General of Canada and told him that 55 paragraphs had been immediately acted upon by the departments concerned; 11 paragraphs were also being examined. Eventually, action would be taken but 33 paragraphs remained untouched. That is what troubles me, Madam Speaker: a committee sits for six months, the report is tabled, it contains a list of government expenditures, the opposition leaves it on the table but when it comes to talking about extravagant government expenditures we are told a lot of rubbish and the discussion is not based on actual expenditures and actual faults of the administration. I think, Madam Speaker, that if we want to be consistent with the institutions of this House, if we want to give them the responsibility, the respect they must have in our parliamentary system it is by coming to grips with reforms like those and leaving for the gallery all other expenditures which are little more than drops of water in an administrative reform whose first object is the interest of Canadians.


Roch La Salle: Madam Speaker, it is with pleasure that I take part in this opposition day resulting from a motion introduced by our party and which blames the government for certain extravagant expenditures and asks that an end be put to a certain waste.
I was quite impressed by the comments of the hon. member for Maisonneuve-Rosemont (Mr. Joyal). He pointed out the importance of very specific subjects. I was also very surprised to learn that ministers did not exercise strict control over certain expenditures. I think it is all to his credit to have said so in the House and that is what concerns me, that lack of control, those exaggerated expenditures, that waste.
A number of members dealt with various matters, such as wasteful spending. There was also reference to overly prolonged mismanagement, maladministration, and inadequate policies falling short of objectives. I recall the hon. member for Edmonton West (Mr. Lambert) mentioned earlier this week the wrong direction taken by the Unemployment Insurance Commission and badly prepared fore-
October 30, 1975

casts. We know the results. I believe this also is wasteful spending.
Since 1968, the government had been re-elected with 175,000 unemployed. We now have 500,000. We hear repeated every day, and we have been told again today by members opposite how often legislation was enacted, how many suggestions tendered, how many efforts and attempts made to improve the situation.
But after ten years, it is realized not only in Quebec but across Canada that the government's credibility is challenged. The public's confidence is getting dangerously low. I hope nobody will say this is our doing.
This opposition day allows us of course to stress these shortcomings, these problems, the Canadian public's concerns.
We blame the government for certain extravagant expenditures. The President of the Treasury Board said this afternoon that I myself enquired about possibilities of extra money in the area of local initiative programs.
Therefore, I was favouring extra expenditures. I think we should look at the advertisement for LIP projects. Since 80 per cent of these projects are refused because of lack of money, maybe savings could be made on advertising expenses, so that more projects may be undertaken.
I think there is much more publicity for so little results. I feel that it is an unnecessary expenditure. On the whole, the government is supposed to invest those funds judiciously. This is a proof after ten years that the social climate is unhealthy, that the people are angry and ill-disposed, even if an attempt was made recently with Bill C-73 to correct this situation.
The Canadian people have seen the government ridicule our party in the House, when we suggested controls two years ago. Four years ago, the leader of the Progressive Conservative party (Mr. Stanfield) during a trip throughout Canada asked the government to take concrete steps and even introduce strict legislation, as we were already referring to inflation control.
Therefore, we were ridiculous, Madam Speaker, but by various devices the government succeeded in frightening the people with the war measures when it was not with something else, but always under the pretext of a national crisis, they convinced the Canadian people that we were wrong.
But today, we have to admit and we do realize that the government must take action. Recently, one of our ministers resigned, the former Minister of Finance, who had obviously, according to our information, already recommended to his government certain restrictive measures. When the government failed to comply with his request on a short term, he resigned.
Recently, the government introduced Bill C-73 which corresponds in principle to a desire that we expressed a few years ago, and especially in 1974.
Already some years ago, there were discussions with reference to controls, mostly in 1974. However, the Prime Minister was perhaps a little ill at ease when he said he had negotiated with the provinces and had been assured of their support as well as that of the unions, etc.
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Today still, we realize that labour organizations are setting up resistance movements, that the provinces are not in agreement. There has been no consultation, Madam Speaker. We were not assured beforehand that the cooperation of those organizations and of the provinces would obviously be a prerequisite to the implementation of the legislation. We agree in principle with control measures, though there must be some assurance that the controls can work. It was misleading information when we were told that the support of essential bodies was secured.
As this requires extensive travels in Canada by members of the government and renewed consultations without delay, considering the resistance of some organizations and provinces, I say that also is a waste of public funds. Perhaps that waste is what I want to make the government aware of, a waste which makes the people of Canada lose confidence in their government.
It is not necessarily the purchase of a Cadillac, but I think the measures introduced during the last ten years, the social context in which we live, the social climate which is terribly disrupted, are a waste on the part of the government. They have not been able to bring in legislation capable of reflecting reality and solving problems. For instance, in the area of unemployment, the government is trying more than ever before to make us accept as a fact of life an unemployment level ranging from 600,000 to 700,000. We certainly cannot accept that.
We have mentioned the possible lowering of the old age security pension entitlement age to 60, which would permit people 60 years of age to retire if they wanted to. I have felt in the past and I still do that this would open the labour market to a great many young people whom we maintain in an unemployment situation and support through social security benefits or other means. Although they carry interesting diplomas, these young people are dissatisfied because they are still unemployed. We still believe that the government should have allowed a few thousand Canadians to retire after 40-odd years of deserving work. The government is saying no to this. I think this would be a way to save a lot of money and correct the social climate. The government says not to this. Although it has taken a very shy step in respect of a group of people, the aged, it is unfair for other groups.
We shall deal with unemployment insurance again this week and we shall try, through the bill under review, to recuperate $250 million from the pockets of the small earners. This is not the way to encourage people to believe in a sound administration. The social unrest which cannot be appeared by such measures force us, of course, to take advantage of this day to blame the government and ask it to think seriously of means to correct the situation. I am led to believe that the government has lost its head, as our people would say. It makes mistake over mistake, with the result that the public in general is not only disappointed, but also deeply worried.
Lately, in May, I cannot say that the government lied deliberately to certain groups of people, I think, for instance, of milk producers, to whom promises had been made and who lost a part of their income because of arrangements made by the Minister of Agriculture (Mr. Whelan) or by the Canadian Dairy Commission. Their

October 30, 1975
Government Spending
income was not sufficient to cover their production cost, and that had lasted for a year. Such measures do not lead them to congratulate the government. And it is still going on.
I think we must realize the economic failure the government is facing at the moment. The Department of Economic Regional Expansion made incredible efforts. To what extent did it make sure that it had sufficient funds to maintain existing industries and to modernize and improve those that could stay in the market, while trying to create new ones?
I feel that while good work was done to create new industries, the jobs that already exist were somewhat neglected. It is all very well to create new jobs; but the basic principle should first assure that present jobs are maintained. And so, the more we have inadequate legislation, the more our modern social climate degrades a concerned people. Of course, we will be accused of making political hay with such allotted days, but I feel that it behoves us to ask the government to introduce measures capable of solving present day problems.
Thought should also be given to the economy we could build. The Solicitor General speaks increasingly of improving the prisons and the parole system, and what it would cost the government. To my mind, we have the right to ask that the people on welfare, the handicapped, be taken care of before making our prisons into living rooms. I think that would be a good investment too. Those are as many things that explain why the people are losing confidence in the government.
And we saw recently that the Canadian people loses confidence in the government. Today the Canadian people want bread and butter on the table. For ten years Canadians have been satisfied with what they had, the majority of Canadians were patient perhaps because of the good image the Prime Minister (Mr. Trudeau) could give on television, because of a few interesting measures, which could also be pleasing, but I think that the honeymoon of the government is now over. The government must put some bread and butter on the table of Canadians and I think they will demand this. I think this is a warning for this government.
Personally, I take the opportunity to ask them to introduce measures which meet the needs of society.


Mr. Bechard:: This is demagogy!


Roch La Salle: This is demagogy, Madam Speaker! And they would like us to congratulate the government when we know full well that the Canadian people suffer. This is demagogy.


Robert Lorne Stanfield: Hochelaga!


Roch La Salle: I did not want to mention it but it demonstrates that people want the government measures geared to their needs and the Hochelaga election may prove to be a first class example of a constituency where the voters turned down a minister to warn the government it had better come back down to earth and present legislation to correct the situation.
|Mr. La Salle.]


Albert Béchard: It was only one riding. The hon. member is making a big fuss over nothing!


Roch La Salle: I hope today's speeches-and we heard some very smart ones from both sides of the House-will make the government understand that people will put up with things for only so long and can kick the government out if the situation does not improve.


The Acting Speaker (Mrs. Morin):: Order, please. It being ten o'clock it is my duty to inform the House that, pursuant to Section (11) of Standing Order 58, the proceedings on the motion have expired.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Bert Hargrave (Medicine Hat):: Mr. Speaker, my remarks tonight in this adjournment debate refer to my question to the minister responsible for the Canadian Wheat Board on October 17 as recorded at pages 8302 and 8303 of Hansard. The question concerned the adjustment payments by the Wheat Board announced on October 9 of this year.
Earlier the Wheat Board had issued an urgent plea for early and large deliveries of grain, especially wheat, in western Canada, to help the Wheat Board meet some of its export commitments. This was an understandable request in view of the very low position of our grain stocks in storage anywhere in Canada available for export. Western grain farmers responded very positively to the Wheat Board's call for stepped-up deliveries, to the extent that approximately three times as much grain has already been delivered to country elevators as compared to a year ago.
It seems obvious to me that this excellent response by western farmers was to a considerable degree due to the understanding that they would have at least the option of deferment of these adjustment payments for income tax purposes. Current tax regulations do permit deferral of the initial grain payment, but the minister's response indicated this is not possible for the adjustment payments due to a need for a "change in the law". In his response the minister said, "-it should be clear that the increase in initial price can in fact be deferred in relation to grain delivered after October 9 when the increase took place".
After October 9 of course the initial price includes the adjustment price, and this higher initial price can indeed be deferred. Surely, Mr. Speaker, for the period prior to October 9, just because the farmer receives two amounts
October 30, 1975

that total the same as the new initial price after October 9, this is no valid argument to deny the producer the option to defer the adjusted payment.
The minister also suggested that the Wheat Board's extreme need for grain deliveries was not a factor in not allowing this tax deferral. I suggest it most certainly was since any farmer who made the decision to deliver early and not wait until the new year with the board's promise of deferral for his traditional price would most certainly have assumed that it would include his total initial price, that is, including the adjustment amount. Can the parliamentary secretary to the minister positively advise if regulations covering this specific situation were posted, or otherwise were available in country elevators when farmers delivered their grain this fall?
Failing a revised regulation giving the farmer the option of deferral, would the Wheat Board consider allowing this deferral provided the initial payment was also deferred; that is, both initial and adjusted payments would have to be treated the same way with the option open for both payments together?
I know the minister has received strong representation on this subject in support of the position I have just outlined from individual farmers, farm organizations, and western members of parliament on behalf of the farmers in western Canada. I hope the minister's parliamentary secretary does not respond by saying that it cannot be done because of the law or that the act would have to be changed. This is what we are here for, and it can be done. Could it be that the government is concerned about other agricultural commodity groups such as cattlemen asking for the same deferral privileges? The deferral precedent is now established so it is appropriate to ask simply "Why not?". I know the minister's parliamentary secretary was in attendance at, and spoke to, the Canada Grains Council meeting in Toronto this morning. I am sure this subject of adjustment price deferral was mentioned at that meeting. I would guess there was considerable support for the position I have taken tonight in this adjournment debate.


Mr. Ralph E. Goodale (Parliamentary Secretary to Minister of Transport):: May I begin by saying how pleased I am to be able to respond this evening to the very pertinent and well spoken comments of my hon. friend from Medicine Hat. He raises a point of considerable concern for many western grain producers.
As he mentioned, just this morning I had the privilege to attend and represent the minister at the semi-annual meeting of the Canada Grains Council in Toronto. In a question and answer period with the delegates in attendance it was clear that this issue of deferring adjustment payments is a matter of interest to many farmers. Opinions of Canadian producers, however, differed on the subject. They varied from those who argue "defer at all costs" to those who say: "No; don't defer at all; we need the cash now." The situation is therefore not unmixed. In any contemplated deferral system it would be important to be able to distinguish the one group of producers from the other.
As the minister advised the House on October 27 we have been conducting discussions to see if and how producers could defer adjustment payment income. These
Adjournment Motion
discussions are still continuing but a practical means has not yet been found to separate those producers who wish to defer this income from those who wish to receive it as soon as possible.
About 30 per cent of deliveries in the current crop year to date have been on a deferred cash ticket basis. However, one cannot always assume because a producer has delivered on a deferred cash ticket basis that he would also wish to defer his adjustment payment. For example, it is possible that certain producers may have anticipated an adjustment to the initial price and planned their deferrals and cash flow pattern with the anticipated receipt of an adjustment payment in this taxation year in mind. Others, of course, may simply be in a cash short position and may indeed want to receive that cash as quickly as possible. Accordingly, it would have to be ascertained with each producer whether he wishes to receive or to defer his adjustment payment.
If the onus were merely placed on the producer to advise the board to defer issuance of his adjustment payment until 1976, we would of course want to ensure that each producer was aware that he had this option. I think the hon. member referred to that point in reverse fashion. Otherwise, undoubtedly there would be many cases of producers not knowing of the option until after they had received their adjustment cheques and then perhaps attempting to return cheques to the Canadian Wheat Board for deferral.
The procedure required to determine which producers wish to defer income, and to ensure that payments are made this calendar year only to those who wish payment would involve extra time and administrative costs and could perhaps make it impossible to make the adjustment payments to any producers before January 1. Generally, our problems in this regard have been aggravated by the disruption of the postal service at the present moment.
In any event I simply want to assure the hon. member that we are aware of the problem he raises. We are working on it now. I cannot guarantee a successful solution to it for the present year, although we are trying very hard. For the longer run I hope we will have a well known, well understood and well advertised mechanism in place to deal with this sort of situation before another year comes around.


CAPE BRETON DEVELOPMENT CORPORATION-REQUEST OF UNITED MINE WORKERS FOR INVESTIGATION OF MANAGEMENT OF CORPORATION-GOVERNMENT POSITION
Andrew Hogan: Madam Speaker, I was glad to hear the new Minister of Regional Economic Expansion (Mr. Lessard), who is responsible for the Cape Breton Development Corporation, on Tuesday telling us that he is willing to attend a meeting between DEVCO coal people and the UMW district executive and the four local union presidents in the area to listen to the criticisms which they have published, especially in the case of the union.
In talking privately to the Prime Minister (Mr. Trudeau), he has made it clear to me that there will be no formal investigation of the DEVCO coal management team by his government. I therefore suggest to the minis-
October 30, 1975

Adjournment Motion
ter that when he goes down to meet with the representatives of the miners and the DEVCO coal officials, he might suggest that they invite Mr. Alex Brown, former special adviser to the federal government on the coal industry, a Cape Breton native and long time friend of Cape Breton coal miners, to chair the meeting between the groups.
In fact I would go so far as to suggest to the new minister that he try to bring the parties together in an all day session under the chairmanship of Mr. Brown to discuss the production and marketing problems of DEVCO, as well as the safety and industrial relations problems. Such a meeting would do a considerable amount to improve the relations between DEVCO and the union, which fell to a bit of a low after the fire in No. 26 mine and the temporary lay-off of some 750 men, of whom I understand all but 275 are now back to work.
The end of this month or early in December seems to be a good time for such a meeting and an airing of mutual problems, suspicions, criticisms, and goals. While I have a good deal of respect for what Mr. Kent has done in comparison with past executives of DEVCO, I feel that some of Mr. Marsh's complaints, which he aired publicly after the No. 26 mine fire, should be seriously considered. Mr. Marsh, the president of district 26 of the UMW since about 1958, has asked for the opening of three coal mines. Mr. Kent has said that there would be only one more new coal mine opened to 1980 which would mean production of some five million tons.
It seems to me that at least two mines in the area could be added-given the uncertainty of No. 26 even under the best of circumstances-and given the high unemployment rate in the area. Likewise, I think that Mr. Marsh's complaint that the present Minister of Finance's (Mr. Macdonald) alleged remark when he was minister of energy, mines and resources that Nova Scotia should depend more for its power on nuclear energy than on coal, should be clarified and explained.
There are many other union management concerns such as safety and industrial relations, that at this particular time should be seriously debated under the direction and guidance of Mr. Brown. I say this because the Cape Breton coal industry is at a turning point where it can go from being an industry totally dependent on the Canadian taxpayer to one in which it can tend toward the breakeven point and indeed even have an operating profit within the next several years. That conclusion can only become a reality if there is an extremely high degree of co-operation on means and ends by labour and management in the Cape Breton coal industry. Given the situation of the past few months I strongly urge the new minister to do everything in his power to get the two groups together at an early date, and preferably under the guidance and direction of Mr. Brown in a closed meeting.


Hon. Marcel Lessard (Minister of Regional Economic Expansion):: Madam Speaker, I am sure we all regret that the progress of the Cape Breton coal industry has suffered a setback because of the fire last June in a newly developed section of Number 26 colliery. But the setback, though serious, is only temporary. It does not in any way change Devco's policy for the modernization of the industry, and the government's approval of the program is unchanged.
| Mr. Hogan. |
It is regrettable but understandable that the setback should have produced some doubt and misunderstanding particularly among the workers. In that situation the suggested meeting seems to be a good idea. I understand that it would be a break from the long standing precedents in the industry, whereby only the top union officials meet with top management, and the locals with management at the individual mines. To get all levels together around one table would, I know, be warmly welcomed by the corporation, and I hope that they and the union will arrange it.
I certainly want to visit Cape Breton as soon as possible to see the industry, to go down the mine and speak with the workers and their leaders. I am not sure at this point in time, however, whether it would be the best thing for me to go and have this meeting. Nevertheless, I think the meeting should be arranged, and if I am not able to attend I will do my utmost to be there as soon as possible afterward to discuss matters.
As to the involvement of Mr. Brown as suggested by the hon. member, I understand that he is an experienced and able man now retired from his position with the Department of Energy, Mines and Resources. I would certainly think he could be helpful as an independent participant if that is the wish of both groups.
I will do my best to make sure that this meeting takes place as soon as possible, and take all steps to see that Mr. Brown participates if all parties agree. As suggested, it might be a good idea for Mr. Brown to chair that meeting as an independent participant.


VETERANS AFFAIRS-PRISONERS OF WAR-DATE OF IMPLEMENTATION OF RECOMMENDATIONS OF COMMITTEE
Mr. Jack Marshall (Humber-St. George's-St. Barbe):: Madam Speaker, the hon. member for Winnipeg North Centre (Mr. Knowles) and I collaborated on questions put to the Minister of Veterans Affairs (Mr. MacDonald) on October 15 to find out the position of the government with regard to the proposed legislation under a new act of parliament to compensate veterans who were former prisoners of war.
There is not much that I can add to what my colleague, the hon. member for Winnipeg North Centre said in the House on October 27, when he took the matter up, only to try to impress again on the government through the minister and to appeal to him again that this legislation be brought forward as soon as possible and, hopefully, before the Christmas recess.
Since I have the time, Mr. Speaker, I can only repeat the recommendations that came about as a result of long study of the Hermann report and the many representations that came before the Standing Committee on Veterans Affairs. The committee recommended in part, as recorded on page 628 of Votes and Proceedings for June 12, 1975:
(1)	That a new act of parliament be enacted to provide compensation to all former prisoners of war. The effect of this would be to retain the principle in the Pension Act that payment of wartime disability pension be restricted to those instances where injury or disease or aggravation thereof was attributable to or incurred during military service, and that special compensation for the maltreatment, indignities and residual disabilities resulting from prisoner of war incarceration which cannot be recognized or identified would be payable under a separate act.
October 30, 1975

(2)	That the formula for compensation payable to former prisoners of war of the Japanese be changed to provide that each such former prisoner of war will receive compensation equivalent to 50 per cent pension to which will be added the amount of pension payable under the Pension Act on account of his assessed disability to a maximum total of 100 per cent-
(3)	The prisoners of'war of other powers of World War II or who were captured by hostile forces subsequent to World War II be awarded compensation in accordance with the following schedule:
Incarcerated 0-1 'A years	10 per cent
Incarcerated l'/2-2'/2 years	15 per cent
Incarcerated 2'A years or over	20 per cent
To this compensation would be added the amount of pension payable under the Pension Act on account of an assessed pensionable disability to a maximum total of 100 per cent.
With regard to the widows of pensioners the committee recommended as follows:
When at the time of death of the prisoner he was, or would have been in receipt of a pension assessed at 47 per cent or less, that pension be paid to the widow in double proportion to the assessed degree of the prisoner s disability as it relates to the basic pension granted to widows.
At the present time a full widow's pension is paid when the pensioner's death was attributable to or was incurred during wartime military service, or in the case of peacetime forces if it arose out of or was directly connected with service; or when the pensioner's disability was assessed at 48 per cent or more at the time of death. The effect of this would be that because 100 per cent widow's pension is payable when the disability pensioner was paid pension at the 50 per cent rate, a double proportion would be payable if his disability was assessed at a lesser rate, so that, for example, the widow of a 40 per cent pensioner would be awarded 80 per cent of the normal widow's pension.
The hon. member for Winnipeg North Centre brought this matter to the minister's attention. The only matter of contention that I have to relate tonight, Madam Speaker, is that time is of the essence, and while I agree with my colleague in addressing a point to the minister, that he was as anxious as we on the standing committee were to make sure that this legislation is introduced immediately, I say that we have heard these stories before. I noted with interest today that the government House leader indicated progress in cabinet with the review of the recommendations, but I have also heard the House leader say the same things before with regard to veterans affairs.
Strangely enough, every prisoner of war association across the country is depending on the members of the Standing Committee on Veterans Affairs to come through with this bill. We on the standing committee can only try to impress on the minister and his government that any delays in introducing this legislation will again result in a lack of faith by veterans' organizations across the country.
I am sure that I can promise on behalf of my party that the legislation would go through all stages in record time and that it would receive co-operation from all parties on this side.
I watch with interest the many speeches the minister makes to veterans organizations across this country.
Adjournment Motion
During the summer recess when members of parliament were supposed to be on holiday, I too made speeches to veterans organizations. The first thing they say, whether they be former prisoners of war or not, is that it is imperative that this legislation be introduced as soon as possible.
While the recommendations are all vital to show our support of prisoners of war, the most vital have to do with widows' pensions and widows who are restricted from receiving a pension if their husband was receiving less than 48 per cent. This section in particular is discriminatory, stupid and ridiculous because it is these widows who most need the help.


The Acting Speaker (Mrs. Morin):: Order, please. I am sorry to interrupt the hon. member, but his time has expired.


Mr. S. Victor Railton (Parliamentary Secretary to Minister of Veterans Affairs):: Madam Speaker, it is a pleasure to be able to speak on behalf of the Minister of Veterans Affairs (Mr. MacDonald) to reply to the question by the hon. member for Humber-St. George's-St. Barbe (Mr. Marshall) requesting a bill relating to Canadian prisoners of war in Europe and Hong Kong.
Hon. members will recall that the Standing Committee on Veterans Affairs at its meeting of June 22, 1972, requested that a study be undertaken to identify any physiological or psychological long-term effects which their incarceration may have had on ex-prisoners of war of the European theatre, numbering approximately 7,500. The government accepted this recommendation and on January 31, 1973, the study was undertaken by Dr. J. Douglas Hermann, a distinguished Canadian surgeon. Dr. Hermann's report was tabled in the House of Commons on Monday, November 18, 1974. It was subsequently referred to the standing committee for study on Wednesday, March 26, 1975, and the committee reported back to the House on Thursday, June 12, 1975.
I ask the hon. member to listen carefully to the last paragraph because couched in its terms he might find some of the answers he is seeking.
In the meantime the Minister of Veterans Affairs has held consultations on this very important subject with his colleagues. At the present time this, along with other government proposals, must be examined carefully in the light of the recently announced guidelines. The minister would hope, therefore, that the request for compensation for ex-POW will not become a victim of our financial restrictions.
As hon. members are aware, the House leader referred to this ir>
the House today. I would like to be more positive, but neither the minister nor I can give the hon. member any further information except that the matter is under close consideration.
Motion agreed to and the House adjourned at 10:27 p.m.


END OF VOLUME VIII