1975-10-20

ROUTINE PROCEEDINGS


Mr. Tom Cossitt (Leeds):: Mr. Speaker, I rise under the provisions of Standing Order 43 to propose a motion which arises from the low morale of the Department of External Affairs, particularly, from attempts by the Department of External Affairs to hush up an incident which occurred in the Canadian Embassy in Tel Aviv, Israel. I move, seconded by the hon. member for Prince George-Peace River (Mr. Oberle):
That the Secretary of State for External Affairs give a complete statement to the House of all circumstances and details involving an incident at the Canadian Embassy at Tel Aviv, Israel, and that the statement should include particulars of the threatened walk-out of members of the embassy staff, the immediate dispatch of a senior departmental official to investigate the problem, the recall to Ottawa of the ambassador at the time, Mr. Paul Malone, and the reasons why he will shortly be reassigned as Canadian Ambassador to Helsinki.


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:: No.


VETERANS AFFAIRS
Mr. William Knowles (Norfolk-Haldimand):: Mr. Speaker, I also rise under the provisions of Standing Order 43 to present a motion of pressing public necessity and importance. Concern of veterans' organizations about the transfer of hospitals to provincial and municipal responsibility, particularly in regard to hospitals not yet transferred, prompts the demand that veterans' organizations should be allowed to present their case to the government, in order that their point of view may be heard. I therefore move, seconded by the hon. member for Humber-St. George's-St. Barbe (Mr. Marshall):
That the matter of transfer of DVA hospitals be referred to the Standing Committee on Veterans Affairs, to ensure that agreement is reached by veterans' organizations concerned to satisfy the interest of Canadian veterans.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


DANGER THAT FOOD ADDITIVES MAY CAUSE HEALTH PROBLEMS IN CHILDREN-MOTION UNDER S.O. 43
Mr. Paul Yewchuk (Athabasca):: Mr. Speaker, I rise under the provisions of Standing Order 43 to propose a motion. As every day there is more evidence to suggest that food additives, particularly artificial colours and flavours, cause health problems in children, and as the Ministers of National Health and Welfare (Mr. Lalonde) has not taken initiatives to look into this problem but seems content to wait for and then benefit from the results of American research, I move, seconded by the hon. member for Huron-Middlesex (Mr. McKinley):
That this House deplores the inaction of the minister in this area of danger to the health of Canadians.


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.



ORAL QUESTION PERIOD

[Stage Direction]
[DOT] (MIO)

Hon. Robert L. Stanfield (Leader of the Opposition):: Mr. Speaker, I have a question for the Minister of Agriculture. On Thursday last the minister said he would try to arrange a meeting in connection with the application of the restraint program to marketing boards. Has the mountain, if you will excuse the expression, yet been able to go to Mohammed and, if so, what truth did Mohammed utter on the occasion?


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, when I tried to call, the phones in his office were busy. When he tried to call me, my line was busy. Therefore, we have not yet been able to arrange that meeting.

October 20, 1975
Oral Questions


Some hon. Members:: Oh, oh!


Robert Lorne Stanfield: Is it the minister's position that prices charged by marketing boards can be regulated and yet have prices left unregulated at the farm gate?


Eugene Whelan: Mr. Speaker, the other day I said that a well run marketing board does not have anything to fear. The prices set by a well run marketing board on behalf of farmers are within reason. This anti-inflation program is a program of reason.


Robert Lorne Stanfield: Does the minister recall telling farm audiences during the last election campaign where my program would end up; that it would go right through the farm gate, into the kitchen and end up in the manure pile?


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: Does the minister feel that guidelines with regard to prices set by marketing boards will end up in the same place?


Eugene Whelan: Mr. Speaker, I want to be sure that the Leader of the Opposition is not mixed up about what I said. I said that his program would freeze prices at the farm gate and that everyone knew it would not stop there. It would go through the yard, through the barn and into the manure pile. It did not have anything to do with the kitchen at all.


Some hon. Members:: Hear, hear!


Eugene Whelan: The Leader of the Opposition knows that his program belonged out in the barnyard. The government program is completely different. It does not put a ridiculous freeze on prices, but allows increases where there are increased costs. We are stopping the cost increases where the farmers are concerned. Their input costs will be under strict control. The farmers, therefore, will not have to ask for more money.


IMPACT OF MARKETING BOARDS ON FOOD PRICES-ALLEGED DIFFERENCE OF OPINION BETWEEN MINISTERS
Mr. James A. McGrath (St. John's East):: Mr. Speaker, I would like to get the Minister of Agriculture back into the kitchen for a minute. In view of the statement attributed to the minister in a speech he made in St. Jacob's, Ontario last Thursday to the effect that the control program will have little impact on retail food prices and in view of the concern that statement has caused throughout the country, has the minister discussed his differences of opinion with regard to the impact of marketing boards on food prices with the Prime Minister, the Minister of Finance and the chairman of the Anti-Inflation Board?


Eugene Whelan: Mr. Speaker, I am not responsible for what a CP reporter has said. If the hon. member wants to listen to the tape-and every word I spoke was taped-he can listen to it and see for himself. I said it would have an impact on food prices because they had the authority to roll them back at the retail level; the essence was there. I said it would not have much effect on farmers themselves; it would not kill the

incentive of farmers to produce those commodities which are in demand in Canada.


James Aloysius McGrath: May I ask the minister, then, whether he can explain the statement he is purported to have made in Vancouver when he said that marketing boards would continue to set their own prices as they have in the past. Can he reconcile those words with the statement made on Friday by the Prime Minister and the Minister of Finance that marketing boards would be subject to the guidelines.


Eugene Whelan: I never said that marketing boards would not be subject to the guidelines. What I said was that any well run marketing board had nothing to fear from the guidelines.


THE CANADIAN ECONOMY
Mr. Edward Broadbent (Oshawa-Whitby):: A question for the Minister of Finance, Mr. Speaker. Last year the Prime Minister said with regard to the kind of controls the minister has now introduced that any advocate of such controls would be, to use his words, indulging in "political opportunism" if it were not pointed out that a number of serious social costs were involved. One of these the Prime Minister specifically cited, and I quote his words-that "income controls risk hurting the small and the poor more than they do the big and the rich". In view of this concern expressed by the Prime Minister last year, would the hon. gentleman now inform the House what specific elements in his control program are designed to benefit the poor as opposed to other sectors of the community?


Hon. Donald S. Macdonald (Minister of Finance):: would want to ascertain whether the hon. member has made a fair quotation, but I would observe that this program is directly related to the powerful in our community-the big corporations, the professions, the owners of property, particularly the owners of land, and, of course, to big labour, big unions. Any measure which prevents them from taking more out of the economy than is their just share is sure to leave more for the rest of the community, particularly for those in the lower income scale. In this sense it is a program specifically directed to the interest of those who are least in a position to protect themselves.


John Edward Broadbent: Since it is entirely possible that if the growth rate of the economy continues to be zero or negative, the groups which the minister described as being larger and more powerful could get less without the poor people getting any more, is the minister really assuming that if there is some reduction in the overall level of inflation the poor are going to benefit as a result? If this is really his argument is it not also the case that the rich will benefit even more because they have more income to spend?


Donald Stovel Macdonald: It seems to me that a program which prevents the rich, and, in this case, the large and powerful in the community, from getting what all
October 20, 1975

their power could give them and preserves the position of those who are less privileged is very much in the interests of the less privileged. This program is intended to assist those who have not been in a position to seek 20 per cent, 30 per cent and 50 per cent settlements or 20 per cent, 30 per cent and 50 per cent rent increases, and in that sense it is very much in their interests.


ANTI-INFLATION PROGRAM-REASON FOR FAILURE TO INTRODUCE REDISTRIBUTIVE TAX MEASURES
John Edward Broadbent: If the minister really wanted to provide benefits for the group for which he is now expressing concern, why could the government not have simultaneously introduced a redistributive tax measure which would have brought specific tax benefits to the very people he is now talking about at the cost-and I acknowledge this-of increasing the tax burden on upper income individuals and corporations?


Donald Stovel Macdonald: As
the hon. member knows, that kind of tax burden hits not only those in the upper income brackets but those in the middle income brackets as well. I would remind him that in the past year by amendments to the family allowances program, by amendments to the income tax system itself, and by changes in the provision of old age security and the guaranteed income supplement, we have specifically directed extra payment to those groups in the community which are the government's special concern.


THE CANADIAN ECONOMY
Mr.   C.-A. Gauthier@Roberval: Mr. Speaker, I have a question for the Minister of Finance.
Since the paper workers' union in Dolbeau, in my riding, have been negotiating since early in 1975 and had to go on strike, could the minister tell the House whether the legislation the government presented will bear upon their union demands and to what extent?


Donald Stovel Macdonald: Mr. Speaker, without knowing the exact nature of the negotiations, I can say that the guidelines in the legislation will apply to all economic sectors in Canada; that it is quite possible that the union referred to will see its expectations reduced in that sense. In any event, when there will be a contract, it will have to be submitted to the Anti-Inflation Board.


Mr. Gauthier (Roberval):: Mr. Speaker, I have a supplementary question for the Minister of Finance.
In connection with a new labour contract within the new anti-inflation legislation, if there is an agreement on the maximum 8 per cent increase, will this affect the
Oral Questions
previously accepted high cost of living escalation provision?


Donald Stovel Macdonald: Mr. Speaker, the guidelines of the new legislation do not affect contracts signed before October 14, 1975.


Charles-Arthur Gauthier: Mr. Speaker, I have a last supplementary question for the Minister of Finance.
Could the minister advise the House whether fringe benefits will be included or excluded within the 8 per cent increase?


Donald Stovel Macdonald: Mr. Speaker, such benefits are included within the guidelines.


FOREIGN INVESTMENT
Mr. Bill Kempling (Halton-Wentworth):: Mr. Speaker, my question is for the Minister of Industry, Trade and Commerce. A few months ago the Foreign Investment Review Board disallowed a takeover bid by White Consolidated Industries of Cleveland, Ohio of Westinghouse Canada appliance division. Inasmuch as the Canadian takeover bid of General Steel Wares does not appear likely to succeed, and in light of press reports that the jobs of 2,300 Westinghouse Canada employees are in jeopardy, what action does the government plan to take prior to October 31, which is the expiry date of the General Steel Wares bid?


Hon. Donald C. Jamieson (Minister of Industry, Trade and Commerce):: Mr. Speaker, I have been apprised of this situation and have been meeting both with my officials and other departments in connection with this matter. Obviously, we are much concerned for the jobs of the more than 2,000 workers involved. We are also disturbed that this may very well represent a defiance of the intent, at least, of the foreign investment review regulations. We are continuing to meet on the subject. I hope to meet with the principals concerned over the next few days to determine what is the best course of action open to the government in the circumstances the hon. member has outlined.


William James Kempling: Mr. Speaker, I thank the minister for that answer and appreciate the fact that he is looking into it, but I should like to ask him this question. Inasmuch as White Consolidated Industries has purchased the rights to the Westinghouse name and is now a supplier of captive parts to Westinghouse Canada, and knowing that White Consolidated is unlikely to convey the name "Westinghouse" to a competitor nor supply the competitor with captive parts, did the Foreign Investment Review Board not foresee this eventuality bearing in mind the substantial difference between the bids by General Steel Wares and White Consolidated?


Donald Campbell Jamieson: Mr. Speaker, I hope the hon. member will appreciate that that is a very complicated question to

October 20,1975
Oral Questions
try to answer in the question period. In any event, I do not have all the answers because I have not had a full briefing from the Foreign Investment Review Board on it. In so far as I understand the situation, it is a highly technical, legal one involving the ownership of the trade mark in a worldwide sense. It is this issue, along with the others the hon. member raised earlier, which are now being examined and hopefully later this week I will be able to provide him with more information.


LEGAL IMPLICATIONS OF WHITE CONSOLIDATED'S REFUSAL TO CONVEY WESTINGHOUSE NAME-DATE OF DECISION
Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker, may I direct a supplementary question to the Minister of Justice with respect to this same matter. It has been reported by the Minister of Labour that the justice department is involved in terms of looking at all the legal implications of the White refusal to convey the Westing-house name, and that there are options being discussed. Can the minister advise whether he has in fact reached any conclusion as to the legal implications here, and can he give the House some indication of the options that are being discussed at this particular time?


Hon. Ron Basford (Minister of Justice):: Mr. Speaker, I can simply advise the hon. member at this point that we are, as he has said, reviewing the matter.


Lincoln MacCauley Alexander: I think my colleague has brought before the House the urgency of this matter in terms of the 2,300 jobs and the GSW offer to purchase which expires on October 31. I would ask the minister then in the time he has had, is he now able to assure this House, the employees of Westinghouse and the Canadian people that there will be an answer by this government, and particularly by the minister before October 31?


Stanley Ronald Basford: Mr. Speaker, if it is appropriate for the Department of Justice to make its views known to the Minister of Labour or the public it will do so before that date.


ADMINISTRATION OF JUSTICE
Mr. J. Robert Howie (York-Sunbury):: Mr. Speaker, my question is for the Minister of Justice, and I should like to congratulate the minister on his elevation to his new post. If he is not successful in the very near future in transfer-ing legal authority to the province of Quebec to resume its very successful probe of criminal activities in that province, will he institute such an inquiry under his own jurisdiction?


Hon.   Ron. Basford@Minister of Justice: Mr. Speaker, I have indicated I think outside the House, that I was considering, in the event that our constitutional challenge was successful, ways of proposing such provincial bodies on an appropriate constitutional basis, and I am considering that.


POSSIBLE APPLICATION OF CRIMINAL CODE TO INTERCEPTION OF CONVERSATION WITH MR. KISSINGER BY MECHANICAL DEVICE
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I should like to address my question to the Minister of Justice, but before doing so may I just take a moment to congratulate him on his new post. I am happy to see two former Ministers of Justice sitting beside him, so he will be able to get the necessary guidance.


Some hon. Members:: Oh, oh!


Eldon Mattison Woolliams: My question has reference to a reply by the Secretary of State for External Affairs to the distinguished member for Fundy-Royal regarding the reporting of a private conversation between the Secretary of State for the United States and one of our distinguished colleagues. The Secretary of State for External Affairs promised an explanation. Has the Minister of Justice reviewed Section 178(2) of the Criminal Code dealing with a possible offence whereby a private communication has been intercepted by certain mechanical devices and such conversation reported and disclosed, contrary to the Criminal Code which calls for a penalty of no less than a maximum of two years?


Hon.   Ron. Basford@Minister of Justice: Mr. Speaker, I think the best thing would be to have the investigation concluded by my colleague, the Secretary of State for External Affairs, so we have the complete picture of what happened, as best we can, and then consider, as I will, the legal consequences that flow from that.
I should like to thank the previous speaker for his kind words to me and my two colleagues who sit next to me.


Eldon Mattison Woolliams: Mr. Speaker, I had hoped that it would not take much time to conclude the investigation. The report which I read in the Washington Post verified that there was a report of a private conversation heard over a mechanical device. I would ask the minister, through you, Mr. Speaker, to look at the precedent set in the city of Calgary when a similar situation developed where a private conversation was reported by tape recorder and reported on the radio and in the press. Charges were laid in that regard as this was a serious offence infringing on the privacy of the individual under these particular circumstances.


Stanley Ronald Basford: Mr. Speaker, I will direct the precedent to my officials.


OLYMPIC GAMES
Mr. Otto Jelinek (High Park-Humber Valley):: Mr. Speaker, in light of the so-called anti-inflationary measures before this House, and in view of the fact there is speculation backed by some evidence that the over-all costs of the Olympics will now reach $1 billion, will the Prime Minister advise this House whether the government has received either up-dated reports on Montreal's further
October 20, 1975

financial problems or requests for additional federal aid, and at the same time will he assure this House that no further federal increases in direct or other costs will be allowed, not only in respect of security but in all other areas? Perhaps the Prime Minister would see fit to advise Mayor Drapeau to seek financial help from the city of New York?


Some hon. Members:: Oh, oh!


THE CANADIAN ECONOMY
Mr. Arnold Peters (Timiskaming):: Mr. Speaker, my question is for the Minister of Finance, and I would refer to page 2 of the government's policy paper on wage controls where it is noted that unless decisive action is taken unemployment will continue to increase.
This morning one of the government's favourite forecasters, the Toronto Dominion Bank, predicted that, as a result of the controls, growth in the economy will slow significantly and unemployment will rise. In view of the degree of unanimity among economists that unemployment is a serious problem of specific concern, does the government intend to undertake to lower unemployment?


Donald Stovel Macdonald: Mr. Speaker, the government accepts the fact that unemployment is an important matter for substantial concern through this winter. It recognizes in particular the difficulty from the Canadian standpoint because of the unemployment involved particularly in our export industries. My colleague, the Minister of State for Urban Affairs and Housing will be announcing a program to deal with that sector of the economy and in other sectors, particularly the export dependant sectors, we recognize there is a real difficulty.


William Arnold Peters: In view of the fact that the government is now trying to shift the unemployment insurance costs from the UIC and away from itself, what specific steps does the government intend to take that will provide employment in light of the fact that restrictions are taking place in all government expenditures?


Mr. Speaker:: Order, please. Despite the hon. member's repeated request for specific steps, I am sure he is well aware he is in a very general area in talking about the whole program concerning unemployment. Perhaps he could be more specific.


William Arnold Peters: I would be particularly interested, Mr. Speaker, in finding out whether the government has intentions of increasing some of the make-work programs it now has in areas such as mine where unemployment is at the rate of 10 per cent. I would also be interested in knowing of whether there is an intention of increasing the amount of the winter works program, the local initiatives program, and some of those programs which are part of the stop-gap employment aid policy.
Oral Questions


Donald Stovel Macdonald: Well, Mr. Speaker, I would not be making an announcement of such a program at this time.


EFFECT OF REDUCED FEDERAL EXPENDITURES ON ATLANTIC REGION-GOVERNMENT ACTION TO ALLEVIATE
Mr. David MacDonald (Egmont):: Mr. Speaker, my question is supplementary to the first question. It concerns the likely increase of unemployment, and the particularly chronic and seasonal difficulties in areas like the Atlantic region, in view of the likelihood of there being some restrictions in federal expenditures. Will the minister be announcing a program or will he be designating the Minister of Regional Economic Expansion to be responsible for making sure that possible cut-backs in federal expenditure will not create further unemployment but rather that a specific program will be devised to deal with the difficulties in regions of economic and social disparity.


Donald Stovel Macdonald: Mr. Speaker, when the colleagues of the hon. gentleman call for reduction in total expenditures we all bear in mind the difficulty this can cause in areas such as his.


Mr. Speaker:: A final supplementary by the hon. member for Egmont.


David Samuel Horne MacDonald: I am rather surprised, Mr. Speaker, that the minister did not hear the question I asked. I asked specifically whether there would be some flexibility with regard to these potential reductions in order that greater hardship is not created for substantial numbers of people in underdeveloped areas.


Donald Stovel Macdonald: I might point out to the hon. gentleman that, of course, the call for reductions in expenditures would fall particularly heavily on those sectors of his area-


An hon. Member:: It is not flexible.


Donald Stovel Macdonald: -would fall particularly heavily on those sectors of his area. We, of course, have been concerned about maintaining the status of transfer payments to the provincial governments and to individuals and that will be continued.


Robert Lorne Stanfield: There is no flexibility. Is that the situation?


POST OFFICE
Hon. W. G. Dinsdale (Brandon-Souris):: Mr. Speaker, I have a question for the Postmaster General. It arises from the continuing saga of the postal negotiations. Now that the Postmaster General has become directly involved in the negotiations, could he indicate to the House whether he has been able to focus the discussions on the key issues

October 20, 1975
Oral Questions
of technological change and premium rates of pay for casual employees, particularly women employees especially in this international women's year? Would he tell us whether these are the matters which still remain to be settled in the negotiations.


Hon. Bryce Mackasey (Postmaster General):: Mr. Speaker, the hon. gentleman will be pleased to know that the matter of automation or the clause on technological change has been resolved. Our inability to come to agreement stems from the unrealistic attitude of the negotiating team which fails to understand that whether they are on strike for one day, three months or three years they will not obtain more in terms of wages than the letter carriers obtained which is $1.70 per hour over 30 months.
If they were to accept that and get on to other areas of the settlement to be negotiated, then the contract of course could be submitted to the Anti-Inflation Board for its approval. The union fortunately has three choices today- and they are meeting now. One is to accept the report of Judge Moisan. Another is to reject it or, third, submit it to the membership to find out whether in their opinion the sum of money which resulted in an 82 per cent ratification by the letter carriers is sufficient for the inside workers as well.


THE CANADIAN ECONOMY
Mr. John A. Fraser (Vancouver South):: Mr. Speaker, I have a question for the Minister of Finance. In view of the position of the government which appears to be that an exception will be made by the anti-inflation board with regard to the postal workers, can the minister state clearly whether any other exceptions will receive the endorsation of the government in advance of an appeal to the AntiInflation Board.


Donald Stovel Macdonald: Mr. Speaker, the hon. member misunderstands. The guidelines are quite clear that the board will consider exceptional circumstances, but neither the postal workers nor any other group will be given the assurance in advance that they will be entitled to an exception.


TRANSPORT
Mr. Lloyd R. Crouse (South Shore):: Mr. Speaker, I am not sure whether my question should be directed to the Minister of Transport or the Minister of Public Works, but I am sure the minister responsible will deal with the problem. Dredging has not been carried on for several years at Liverpool, Nova Scotia and the harbour has deteriorated to a point where navigation is hazardous because of the shallow depth of the water. In light of the fact that the harbour is navigable only about four out of

every 12 hours, or in other words at high tide, and ships are going aground in the harbour, will the minister investigate this situation in the hope that urgently required dredging for the protection of the shipping industry will be carried out.


Hon. Otto E. Lang (Minister of Transport):: Mr. Speaker, I will be glad to take note of that representation.


SUGGESTION FEED GRAINS BE SUBJECT TO WHEAT BOARD QUOTA LEVELS-GOVERNMENT POSITION
Mr. Ray Hnatyshyn (Saskatoon-Biggar):: Mr. Speaker, I should like to direct a question to the minister responsible for the Canadian Wheat Board. In view of reports that the Canadian Wheat Board advisory committee has passed a resolution to the effect that feed grains for the domestic market should be subject to the same quota levels as those in effect for grains delivered to the Canadian Wheat Board, is the government planning to initiate any steps in this respect having regard to the resolution passed by the advisory committee.


Otto Emil Lang: No, Mr. Speaker. Indeed the rather rapid increase in quotas for grains delivered to the Canadian Wheat Board has put that question into the academic basket. However, in any case the feed grain policy really will work well only if there is open access to delivery points by farmers who wish to deliver their grain into that open market. That was clear at the beginning. We did provide for certain safeguards in case congestion occurred as a general rule, but there has been no sign of that at all as a result of the feed grain policy and therefore there is no reason for change.


INLAND WATERS
Mr. T. Lefebvre (Pontiac):: Mr. Speaker, my question is directed to the hard-working Minister of Indian Affairs and Northern Development. Has the minister had an opportunity to study the very realistic report on the possibility of opening up the Ottawa River to pleasure craft navigation. Have his officials studied it, and is he ready to inform the House today or soon what stand he and his department will take on this very important development for both sides of the Ottawa River.


Hon. Judd Buchanan (Minister of Indian Affairs and Northern Development):: Mr. Speaker, as the hon. member indicated we have received this report. I have gone through the report. It is currently being studied by the officials of the department. We are somewhat concerned about the magnitude of some of the costs involved. However, we are looking at this seriously, particularly at some of the earlier stages, to see what can be done.
October 20, 1975


Thomas Lefebvre: Mr. Speaker, would the minister be willing to attend a public meeting in the upper Ottawa valley-


Some hon. Members:: Hear, hear!


Thomas Lefebvre: -when he is ready to make such a statement, so that the citizens who are very interested in this project could be there personally to question him on his statement?


THE CANADIAN ECONOMY
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, my question is for the Minister of Finance. On Friday, in answer to a question concerning prior notification of price increases on some products, the minister noted that such a proposal was impractical and then went on to say that he would consider the suggestion. On the same day, Mr. Pepin announced that certain companies would be required to give prior notification of price increases. In view of that, can the minister say whether or not such prior notification will be part of the government's control package?


Donald Stovel Macdonald: To put the record straight on that, may I point out that I said that prior notification on all products was impractical. I also pointed out in my speech-which I commend to the hon. gentleman-that indeed Mr. Pepin proposed to require prior notification in some cases where that was a practical possibility.


Lorne Edmund Nystrom: As a follow up I should like to ask the minister whether he can tell the House for which industries or which products or commodities prior notification of price increases will be required as a necessity. If he cannot tell that to the House now, can he say when he will be notifying the public?


Donald Stovel Macdonald: That is allied to the question asked by the hon. member for York-Simcoe earlier about notification and about the companies to which notification has been sent. I will be glad to advise the House and the standing committee on the full details of this as soon as I can provide the information.


UNEMPLOYMENT INSURANCE
Mr. Jack Marshall (Humber-St. George's-St. Barbe):: Mr. Speaker, my question is for the Minister of Manpower and Immigration who is responsible for unemployment insurance. In view of the fact that the proposed income
Oral Questions
support program for fishermen, which was to be implemented by July, 1975, is not as yet implemented, and there is a danger that it might be further delayed, has the minister taken action within his jurisdiction to change the Unemployment Insurance Act as proposed by various provinces to overcome the existing inequities to fishermen?


Hon. Robert K. Andras (Minister of Manpower and Immigration):: Mr. Speaker, it was decided some time ago that policy development in these areas more properly falls within the jurisdiction of my colleague, the Minister of State for Fisheries, while the Unemployment Insurance Commission may continue to provide the delivery system and the administration of whatever policy change will be decided upon in that area.


THE CANADIAN ECONOMY
Mr. Donald W. Munro (Esquimalt-Saanich):: Mr. Speaker, my question is addressed to the Minister of Finance. Many employees of what was once known as the Defence Research Board, a part of the Department of National Defence, and possibly other public servants have either been denied their normal salary increments or have been prevented from bargaining because they have been waiting for months now on Treasury Board for reclassification and certification. Since the situation has been protracted inordinately as a result of Treasury Board dilatoriness, will the minister say whether the recently published guidelines will be made applicable to these employees?


Donald Stovel Macdonald: Mr. Speaker, if I could draw the attention of the hon. member to the guidelines he might find the section in which reference is made to the transitional situation of such employees.


ENVIRONMENTAL AFFAIRS
Mr. Jack Murta (Lisgar):: Mr. Speaker, I should like to direct a question to the Minister of the Environment. In July the text of a note of protest from the Government of Canada to the government of the United States over the Garrison Diversion project was issued, part of which reads:
The Government of Canada, therefore, is pleased to learn that consideration is being given to alternatives to the current Garrison Diversion unit which would not adversely affect Canada.
The Government of Canada has not yet been officially informed . ..
I should like to ask the minister, since that note was issued some four months ago, if she could inform the House whether or not there are alternatives to the Garrison Diversion unit being considered, and whether or not

October 20, 1975
Oral Questions
Canadian and United States officials have had talks on this important matter?


Hon. Jeanne Sauve (Minister of the Environment):: Mr. Speaker, we have gone very much beyond the note to the United States authorities. We are now in the process of handing to the International Joint Commission a joint reference with the U.S.A. about the Garrison Diversion unit which calls for such measures including modifications to the Garrison project.


Jack Burnett Murta: I should like to ask the minister if she can outline briefly what the terms of reference on the Garrison Diversion project will be to the International Joint Commission and if she has any further information to add.


Jeanne Sauvé: The reference to the International Joint Commission outlines the fact that we are not satisfied that the project as conceived will not do damage to Canadian property or the Canadian environment. Therefore, we state that we feel that a new assessment of this project must take place and that modifications must be envisaged in order to ensure that the United States will really fulfil its obligations under the Boundary Waters Treaty.


INDIAN AFFAIRS
Mr. Dean Whiteway (Selkirk):: Mr. Speaker, my question is for the Minister of Indian Affairs and Northern Development and it stems from the incident which took place in Winnipeg about a month ago in which the regional director walked out of a meeting just prior to the presentation by the vice-president of the National Indian Brotherhood. When asked by the press why he was leaving, he said he had heard it all before. Would the minister indicate to the House whether he has reprimanded the department or whether he concurs with the action, or what the future performance of the department will be with reference to such a meeting?


J. Judd Buchanan: Mr. Speaker, I have not reprimanded the departmental officials. It seems to me that there are more logical and sensible ways to try to deal with these matters than barging into meetings. That is the reason we have established the joint committee of the cabinet and National Indian Brotherhood as the committee to deal with these problems. If it is a grave concern, that is the logical place in which to deal with it rather than barging into regional directors' meetings.


THE CANADIAN ECONOMY
Mr. Leonel Beaudoin (Richmond):: Mr. Speaker, I would like to direct a question to the Minister of Finance.
Since generally speaking the provinces seem to join in the collective effort all Canadians must do to stop inflation, according to the guidelines of Bill C-73, can the minister tell the House if provinces, or a particular province, have expressed the intent to cancel LIP projects for their area in 1975-76, in line with this will to cut the expenses?


Donald Stovel Macdonald: Mr. Speaker, I will meet with my provincial counterparts on Wednesday and Thursday, and I might have on this occasion an indication by the ministers about their intents in relation to the general program.


AGRICULTURE
Mr. Gordon Towers (Red Deer):: Mr. Speaker, my question is directed to the Minister of Agriculture. In view of the minister's statement made to the agricultural undergraduate society of the University of British Columbia that controls on industry will hold down farmers' costs of production, and in view of the fact that a large portion of growing farm operation costs is due to the ever rising price of imported farm machinery, was the minister's statement a result of discussions he had with Henry Kissinger during his Ottawa visit or with any other representative of the government of the United States?


Eugene Whelan: Mr. Speaker, these statements were made on the basis of facts.


Some hon. Members:: Oh, oh!


An hon. Member:: That's a joke!


Thomas Gordon Towers: Will the minister inform the House what the results were of the discussions he had on the costs of production of farm equipment?


Eugene Whelan: I have had many discussions regarding the farm machinery industry. I think that, because of free trade, we have lost a big portion of our farm machinery industry. I mentioned it to Mr. Kissinger when he was here.


EFFECT OF PRICE GUIDELINES ON MARKETING BOARDS
Mr. Bill Jarvis (Perth-Wilmot):: Mr. Speaker, my question is directed to the Minister of Agriculture and it relates to the applicability of guidelines or controls to farm marketing boards. Can the minister tell the House whether it is the position of the government that farm marketing boards could not increase the price of the commodities they sell beyond the increased production costs of those producers who make up the membership of that particular farm marketing board. Is that the test that will be applied?


Eugene Whelan: Mr. Speaker, first, it should be made clear to the House that there are very few marketing boards that set the price. They do not have that authority. We only have three federal boards which set prices for commodities, the

October 20, 1975

Canadian Dairy Commission, CEMA and the Turkey Marketing Board, which come under my jurisdiction. The rest are under provincial jurisdiction and many of them do not have authority to set prices. Those which have authority to set prices take into consideration the cost of production features when they are negotiating the price with the processors who are going to buy the product. I can tell the hon. member this, and I am sure he is aware of it already, that they never do get exorbitant amounts of money for their products. Most contracts are signed for one year, and if inflation increases production costs during that year the farmers do not get an added bit of pay for the product that year. With this new program, some marketing boards should be asking for less next year.


EFFECT OF ANTI-INFLATION PROGRAM ON AGRICULTURAL RESEARCH PROJECTS
Mr. Jake Epp (Provencher):: Mr. Speaker, I would direct my question to the Minister of Agriculture and I am hopeful because he is dealing in facts today. In view of demand around the world for increased agricultural production and in view of the need to bring restraint into our economy, has the minister discussed with the Minister of Finance what programs will be adopted in Canada in agricultural research in order that they may be expanded and we might get back to increased productivity and get our economy back under control?


Eugene Whelan: Mr. Speaker, I have said it many times before and I will say it again. If all other segments of the economy had increased productivity by the same amount as farmers have, that is 100 per cent per capita in the last ten years while the rest of the economy, only increased productivity by 40 per cent, we would not have to put the kind of programs into effect that we have.


Arthur Jacob (Jake) Epp: A supplementary question, Mr. Speaker. Could I ask the minister what progress he has in mind for expansion in agricultural research so that productivity will increase?


Mr. Speaker:: Order, please. I am sure the hon. member realizes this is no place for a recitation of that sort. The hon. member for Winnipeg North Centre.


CANADIAN PACIFIC RAILWAY
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, my question is for the Minister of Transport. In view of the fact that some 400 employees are to be laid off from the CPR shops in Winnipeg this Friday evening, and in view of the fact that my colleague the hon. member for Winnipeg North and I have been raising this matter with the minister's predecessor for some considerable time, can the new Minister of Transport say whether he is in a position to do anything this week to prevent this lay off from taking place?
Oral Questions


Otto Emil Lang: No, Mr. Speaker. I do not have anything new to report.


Stanley Howard Knowles: A supplementary question, Mr. Speaker. In view of the seriousness of this situation will the minister communicate with the CPR about this matter this week?


Otto Emil Lang: Mr. Speaker, I will give that matter the serious consideration I always devote to the hon. member's comments.



ADMINISTRATION OF JUSTICE


Mr. Walter Baker (Grenville-Carleton):: Mr. Speaker, my question is for the Minister of Justice. I am referring in this question to the statement by the Prime Minister on Thanksgiving Day that the government's program to reduce violent crime would be introduced shortly, and the minister's indication that this was to be the case. Can the minister tell the House today when that package of amendments or statutes will be introduced in the House? Can he also tell the House whether those amendments will be in a form to permit members to vote separately with the respect to each item in the package, bearing in mind that there are reports of such diverse items as gun control, parole and abolition of capital punishment as well as a number. of other items. Are members going to have an opportunity to deal with each of those subjects on their merits?


Stanley Ronald Basford: Mr. Speaker, I cannot give the hon. member a definite answer in that it relates to discussions with my colleague and certainly consultations would have to be held with provincial governments and others as to when we can commence drafting the legislation. On the second question, some decisions remain to be made within the government on that issue. As to the nature of any bill or bills to be introduced, however, I would point out to the hon. member that in the normal course of events each bill goes to a standing committee where each separate proposition can be voted on by itself.



ADMINISTRATIVE ERRORS IN CONNECTION WITH RELEASE OF PRISONERS

Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I have a question for the Solicitor General on the subject of "administrative errors" as he referred to them last week, resulting in inmates of penitentiaries being released when they ought not to be, often with tragic results. I would like to ask the hon. gentleman now about the converse, where an inmate is kept in custody when his sentence has been completed which occurred not too long ago in the province of New Brunswick. I would ask if the minister can assure the House that in future he will try to keep those prisoners in who should be in, but will also let prisoners out when it is time for them to get out?

October 20, 1975
Oral Questions


Hon. Warren Allmand (Solicitor General):: Yes, Mr. Speaker.



EFFECT OF FOOD ADDITIVES ON HEALTH OF CHILDREN- GOVERNMENT ACTION

Paul Yewchuk: Mr. Speaker, my question is for the Prime Minister. Inasmuch as artificial colourings and flavourings in the Canadian food supply are thought to be causing hyperactivity in children, can the Prime Minister explain why his government has not taken any steps to see that research is done on this problem in Canada but instead has adopted the course of awaiting the results of research being done in the United States on this matter?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, I would be glad to take notice of the question on behalf of the Minister of National Health and Welfare to whom it ought, obviously, be addressed.



NATIONAL DEFENCE


Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, may I put a question to the Minister of National Defence? As there is serious doubt about whether Canada will have enough military personnel to properly police next year's Olympic games in Montreal and as the games are strictly an international affair, would the minister consider inviting some of our NATO allies to send troops to Canada to assist with crowd control and security problems?


Hon. James Richardson (Minister of National Defence):: Mr. Speaker, there is no doubt whatsoever about the capability of the Canadian Armed Forces to provide security and to assist the other authorities in making certain that the athletes and spectators at the Olympics are secure. I think all Canadians would be glad to know that the armed forces are able and ready to do that.



AGRICULTURE


Robert Lorne Stanfield: Mr. Speaker, my question is for the Minister of Agriculture who said a few moments ago, no doubt quite correctly, that generally speaking marketing boards take into consideration the costs of producers when negotiating a price. Can the minister tell us whether marketing boards are subject to a guideline under which they can increase the prices they negotiate only to the extent of the increase in the costs of their producer members and can marketing

boards be asked by the Anti-Inflation Board for justification of increases within its terms of reference? No skating around, please.


Eugene Whelan: Yes, Mr. Speaker, I would say that most of the requests previously made by marketing boards would be within those terms of reference.


An hon. Member:: That is nonsense.



ROUTINE PROCEEDINGS


[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr.   J.-J. Blais@Parliamentary Secretary to President of the Privy Council: Mr. Speaker, the following questions will be answered today: 399, 400, 1,520, 1,844, 2,535, 2,767, 2,977, 2,978, 2,979, 2,980, 3,056, 3,074, 3,077, 3,088 and 3,119.


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


Hon. Mitchell Sharp (President of the Privy Council):: 1. See replies to questions No. 897 of November 19, 1974, No. 343 of March 4, 1974, No. 151 of October 1, 1974, No. 2,788 of October 15, 1973, No. 107 of January 4, 1973, No. 159 of February 22, 1972 and No. 79 of October 8, 1970, and the Public Accounts for the appropriate year.
2. None.


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


Mitchell William Sharp: See reply to question No. 399.
October 20, 1975

Order Paper Questions


Mr. Cossitt: What are the names and addresses of all persons who have, since April 20, 1968, acted in any way by retainer or contract or any other arrangement, as advisors, consultants, or so-called experts to the Prime Minister's Office (a) in each case, what are the dates such work was performed, what was the nature of such work and what fees were involved (b) what is the total cost involved during all the time since April 20, 1968 (c) what are all the reasons, in each case, that such persons were used instead of the services of the Public Service?


Mitchell William Sharp: See reply to question 399.
Cabinet Minister, other than the Minister of Indian Affairs and Northern Development, respecting a real, possible or potential conflict of interest arising from the holdings or investments of such Cabinet Minister, or the absence of any such conflict and, if so, who are the Cabinet Ministers and which of their investments or holdings are involved?


Mitchell William Sharp: Yes. These consultations led to all Ministers bringing themselves into compliance with the conflict of interest guidelines that were announced in the Prime Minister's statements to the House on July 18th and December 18th, 1973.
STATEMENT BY MR. K. R. MacGREGOR


Mr. Cossitt: 1.	Is the Prime Minister aware of the following statement by Mr. K. R. MacGregor, Chairman of the Board of Mutual Life and former Federal Superintendent of Insurance, made to the annual meeting of the Mutual Life Assurance Company "We are heading rapidly towards the essentials of the U.S. Presidential system. Power is becoming concentrated in the Prime Minister's Office and the Privy Council Office with inevitable lessening of the influence of the Cabinet and Parliament and with inevitable changes in the character and status of the Public Service."?


Mr. Hnatyshyn: Has the government received any payments from the Prime Minister or any Minister personally, or on their behalf, respecting the use of property of the government since January 1, 1972 and, if so, what are the particulars and dates of such payments?


Mitchell William Sharp: In so far as the Prime Minister is concerned: Yes. See Section 5, Official Residences Act.
2.	Does Mr. MacGregor's statement represent an accurate picture of the way the government is operating and (a) if so, what are the additional steps the government has planned to move further towards governing Canada from the Prime Minister's Office (b) if not, what are the specific and detailed reasons that the government considers Mr. MacGregor's statement inaccurate?


Mitchell William Sharp: See Beauchesne's Parliamentary Rules and Forms, Fourth Edition, Citation 171 (nn).



CONFLICT OF INTEREST


Mr. Caccia: 1.	How many immigration offices does Canada maintain outside Canada?
2.	How many immigration officers are stationed in each such office?
3.	How much money has it cost to maintain and staff each such office in the years 1970 to 1975?
4.	How much money does the government expect to spend to maintain and staff each such office in the fiscal year 1975-76?
Question No. 2,535 Mr. Lawrence:	Hon. Robert K Andras (Minister of Manpower and
Has the Prime Minister, or any person acting on his behalf, given Immigration): 1. As of July 31, 1975, 59. verbally or in writing any opinion, certification, or undertaking to any	2 3 and 4 See Table following.
(2)	(3)	Cost of operating offices (a)	(4)Posts	Offi-	1969-70	1970-71	1971-72	1972-73	1973-74	1974-75	1975-76cers	EstimateAthens	4	142,757	147,555	108,640	108,624	92,928	94,172	97,825Atlanta	l	6,067	37,931	33,128	35,800Beirut	4	148,659	171,086	100,895	129,051	73,284	80,614	99,300Belfast	2	54,074	61,473	41,311	41,281	39,591	45,226	55,200Belgrade	4	75,988	77,933	67,830	99,106	79,510	79,280	88,000Berlin	1	20,049	91,375	21,979	23,828	32,400Berne	2	105,858	110,683	75,480	62,197	39,788	50,212	57,700Birmingham	5	76,809	106,495	66,922	88,555	67,085	80,426	102,360Bogota	1	20,454	33,060Bonn	3	238,927	208,961	171,456	114,691	100,198	101,606	78,158Bordeaux	1	62,319	55,056	31,634	29,775	30,199	32,510	35,600Boston	2	27,700	43,115	79,607	57,700Brussels	2	138,789	129,199	63,504	56,360	53,897	55,240	67,700Budapest	1	21,731	33,812	17,685	20,769	24,433	21,161	24,500Buenos Aires	2	12,912	30,386	39,427	57,064	60,323Buffalo	2	12,217	25,786	47,866	58,800Cairo	2	59,298	62,574	57,223	47,254	42,775	40,516	53,600Chicago	3	72,144	91,375	51,764	46,694	39,708	56,105	73,000
October 20, 1975
Order Paper Questions
	(2)	(3)
Posts	Offi- cers	1969-70Copenhagen	1	88,039Dallas	1	Detroit	3	Dublin	1	35,495Glasgow	5	117,651Hamburg	0	72,338Hong Kong	9	400,869Islamabad	2	75,261Kingston	5	86,858Lisbon	4	79,329London	16	623,196Los Angeles	3	36,394Madrid	1	58,872Manchester	6	117,140Manila	5	97,920Marseille	2	91,582Mexico City	1	Milan	1	121,641Minneapolis	1	Nairobi	4	New Delhi	7	172,198New Orleans	1	New York	6	85,295Oslo	0	14,018Paris	8	478,867Port au Prince	2	Port of Spain	6	156,433Rabat	2	Rome	5	438,279San Francisco	3	107,435Seattle	3	Seoul	3	Singapore	2	Stockholm	2	84,581Stuttgart	3	106,649Sydney	3	125,719Tel Aviv	2	79,627The Hague	3	134,221Tokyo	2	148,623Vienna	2	173,699Warsaw	2	
Cost of operating offices (a)
1970-71	1971-72	1972-73101,866	62,848	60,73212,42916,39646,479	29,747	39,475124,656	65,774	67,30994,311	53,247	44,589370,371	199,473	225,90268,367	33,715	11,319107,144	85,218	92,23881,509	73,256	87,302536,725	399,766	320,2493,699	5,84865,553	42,159	55,786106,484	61,373	61,05379,690	77,693	114,91097,917	45,633	43,429104,394	52,875	46,08810,36618,579167,488	94,255	118,6155,94198,654	71,755	112,3265,585	6,411	5,863410,877	283,251	197,082177,126	105,429	121,314364,880	182,597	163,164111,682	68,895	52,53410,74582,826	59,064	62,714139,374	88,347	83,660133,401	80,704	83,13473,001	51,289	47,319135,387	103,928	92,921143,474	96,392	112,504198,491	101,458	120,216
(4)
1973-74	1974-75	1975-76 Estimate61,683	53,312	42,78024,842	33,607	37,00038,894	58,765	73,20033,312	29,203	30,650667,195	82,283	95,30017,924	16,459	14,271182,872	213,030	208,10021,059	46,512	51,00066,595	88,587	111,20087,960	92,190	105,704237,274	316,641	387,50038,522	50,490	69,60045,796	40,905	34,55060,307	84,568	114,90093,346	100,272	114,10050,301	56,297	60,80010,305	35,06241,817	38,588	31,30024,028	31,812	37,92051,981	67,154	97,76084,961	126,034	147,70018,752	39,051	30,40093,931	113,999	162,60011,315	18,987	11,220145,669	146,148	208,10027,891	54,21795,066	124,797	139,7005,298	38,127	51,500111,950	79,667	112,50045,460	65,875	61,83528,668	46,465	71,25021,686	56,417	66,10014,072	32,550	56,20046,480	49,356	59,02561,552	78,922	85,40085,494	81,995	94,10037,744	46,478	54,40060,792	75,936	75,95069,577	61,792	64,90072,180	54,354	56,5009,298	32,325	42,700(a)	Costs include only those chargeable to Immigration Vote 15. Costs paid by the Department of External Affairs such as locally engaged staff, accommodation, etc., are not known.



PRIME MINISTER'S OFFICE

Mr. Clark (Rocky Mountain): What specific regulations, directives, guidelines or other action have been issued or taken by (a) the Prime Minister (b) the Clerk of the Privy Council (c) any other officer to ensure that any person employed in or by the Privy Council does not interfere with ministerial responsibilities in the formulation and evaluation of policies?


Mitchell William Sharp: See pages 33:18 and 33:19 Minutes of Proceedings and Evidence of the Standing Committee on Miscellaneous Estimates for Monday, May 12, 1975; and pages 36:26 and 36:27 of Issue No. 36 for Tuesday, May 20, 1975.
[Mr. Andras.)



PRIME MINISTER'S OFFICE-NAMES AND TERMS OF REFERENCE OF OFFICER OR GROUP UNDER CONTRACT

Mr. Clark (Rocky Mountain): 1.	What are the names and specific terms of reference of any officer or group in or under contract to (a) the Privy Council Office (b) the Prime Minister's Office (c) any other government agency who are presently engaged in any analysis of any aspect of the working of Parliament with the intention of proposing suggestions for reform of Parliament to the Prime Minister or with any other purpose?
2.	In each case, which areas of parliamentary activity are being analysed?


Mitchell William Sharp: As stated previously to the House (see page 6022 of the House of Commons Debates for May 22, 1975) I take responsibility in my capacity as President of the Privy Council in matters concerning the reform of Parliament.
October 20, 1975



PRIME MINISTER'S OFFICE-NAMES OF PERSONS EMPLOYED TO CONSIDER PARLIAMENTARY REFORM

Mr. Clark (Rocky Mountain): In each year 1966 to 1975, what were the (a) names (b) terms of reference (c) salary range of any persons or groups employed or engaged by the Prime Minister's Office or the Privy Council Office to consider any aspect of (i) parliamentary reform (ii) government organization?


Mitchell William Sharp: In each year from 1966 to 1975 so great a number of persons in the Prime Minister's Office and the Privy Council Office have been concerned with some aspect of Parliamentary Reform or government organization that it is not possible to give a complete and accurate answer to this question.



APPOINTMENT OF PETER TURNER-PRIVY COUNCIL OFFICE

Mr. Munro (Esquimalt-Saanich): 1.	On what date was Peter Turner appointed to the Privy Council Office?
2.	Was the appointment made by (a) open (b) closed public service competition (c) Order in Council?
3.	What are his duties in the operations and planning Directorate of the Privy Council Office (a) in what salary range was he employed (b) in what salary range is he now being paid?
4.	At what level was he assigned in the Directorate (a) Director (b) Deputy Director (c) other?
5.	In the years 1973-74, 1974-75 and 1975-76 (a) how many persons were serving in the Directorate (b) how many man-years does this represent (c) what is the cost in dollars?


Mitchell William Sharp: 1. July 21, 1975.
2.	(a) Yes, Public Service Employment Regulations 7(l)(b)(ii) inventory of outside applicants, (b) and (c) Not applicable.
3.	Under the direction of the Assistant Secretary to the Cabinet (Priorities and Planning), acts as an Assistant Secretary to a Cabinet Committee, (a) $24,500 to $30,600.
(b)	$24,500 to $30,600.
4.	(a) and (b) Not applicable, (c) Secretariat Officer/ Assistant Secretary to Cabinet Committee (Priorities and Planning).
5.	(a) 1973-74, 10 persons, 1974-75, 10 persons; 1975-76, 9 persons, (b) 1973-74, 10 staff-years; 1974-75, 10 staff-years; 1975-76, 9 staff-years, (c) 1973-74, $173,650; 1974-75, $185,291; 1975-76, $69,486 (half year).



ABORTIONS

Mr. Robinson: What has been the cost to the taxpayer to provide free abortions under health services for each year 1968 to 1975 inclusive?


Mr. Marcel Roy (Parliamentary Secretary to Minister of Industry, Trade and Commerce):: Statistics Canada collects data on the number of therapeutic abortions performed in Canadian hospitals. Refer to House Question 3077 for this information. Statistics Canada does not col-
Order Paper Questions
lect detailed data on the cost of providing various specific types of medical services.



Mr. Robinson: How many (a) legal (b) illegal abortions have been performed in each accredited hospital in Canada in each year 1968 to 1975 inclusive?


Marcel-Claude Roy: Statistics Canada reports that data on legal therapeutic abortions from August 1969 to December 1973 are available. Data for 1974 have been collected and are currently being processed. Data for 1975 are being collected but have not yet been analysed. Data on illegal abortions in Canada are not available since these are, for the most part, not reported. Data on the total number of legal therapeutic abortions performed in each province in each year from late 1969 to 1973 inclusive are presented in the attached table. The number and location of accredited and approved hospitals with therapeutic abortion committees have been reported by each province and are available from 1972 to 1974 inclusive. See Table II. The Statistics Act specifically precludes the release of information on the number of therapeutic abortions performed in each individual accredited hospital.
Table I
Therapeutic Abortions by province of report,
Canada, August 1969-December 1973
August 26,
Reporting Area	1969 to December 31, 1969	1970	1971	1972	1973All Areas	542	11,200	30,949	38,905	43,245Newfoundland	2	25	80	133	166Prince Edward Island	18	39	44	41Nova Scotia	18	263	645	839	947New Brunswick	4	72	146	183	330Quebec	23	541	1,903	2,912	3,217Ontario	274	5,657	16,244	20,314	22,661Manitoba	17	248	864	1,198	1,274Saskatchewan	12	217	760	1,028	1,203Alberta	-	1,172	3,169	3,994	4,132British Columbia	191	2,981	7,090	8,211	9,192Yukon	1	6	9	49	82
Table II
Number of Hospitals with Therapeutic Abortion Committees by province, Canada as at January 1, 1971 to 1974
Area	1971	1972	1973	1974All Areas	143	247	261	258Newfoundland	4	7	7	6Prince Edward Island	2	2	2	2
October 20, 1975
Order Paper Questions
Area	1971	1972	1973	1974Nova Scotia	6	11	12	12New Brunswick	7	7	7	7Quebec	16	23	31	27Ontario	48	104	108	108Manitoba	4	9	9	9Saskatchewan	8	10	10	10Alberta	18	23	23	24British Columbia	29	50	51	52Yukon	1	1	1	1



NUMBER OF REPEAT ABORTIONS

Mr. Robinson: How many women in Canada have had more than one abortion at the taxpayers expense?


Marcel-Claude Roy: Statistics Canada reports the following: Detailed data on repeat therapeutic abortions are not yet available for 1974. Data for 1972 and 1973 are available through the individual case reporting system. In 1972, in reports from six provinces and the Yukon (excluding Nova Scotia, Quebec, Ontario and British Columbia) there were a total of 413 repeat abortions out of a total of 6,382 abortions reported. In 1973, in reports from eight provinces and the Yukon (excluding Ontario and British Columbia) there were a total of 591 repeat therapeutic abortions out of a total of 11,249 abortions reported. As therapeutic abortion has been considered a required medical service by provincial departments of health, payment for this service would fall within the terms of the shared federal-provincial Health Insurance program.
Province of Residence by Number of Previous Spontaneous and Induced Abortions, Canada, 1972 and 1973
Item	All Areas	New- found- land	Prince Edward Island	Nova New Scotia Brunswick		Quebec	Manitoba	Sas- katche- wan	Alberta	Yukon
				1972						
Total cases reported Previous spontaneous	6,382	133	45	-	183	-	1,178	1,043	3,752	48Abortions 0	5,397	121	40	170	868	964	3,389	451	328	10	2	-	7	-	47	48	214	-2	100	-	1	-	4	-	16	15	61	8More than 2	91	2	2	_	2	-	15	14	56	-Unknown	266	-	-	-	-	-	232	2	32	-Previous induced Abortions 0	5,969	131	45	176	917	1,022	3,632	461	138	2	-	-	6	-	27	18	83	22	7	-	-	-	-	-	2	-	5	-More than 2	-	-	-	-	-	-	-	-	-	-Unknown	268	-	-	-	1	-	232	3	32	-413	1973	Total cases reported Previous spontaneous Abortions	11,249	193	41	932	341	3,141	1,259	1,219	4,047	760	10,161	166	37	873	304	2,725	1,160	1,084	3,749	631	656	12	3	33	20	286	51	55	184	122	181	3	1	8	5	74	13	17	60	-More than 2	132	3	-	8	5	54	14	13	34	1Unknown	119	9	-	10	7	2	21	50	20	-Previous induced abortions 0	10,658	178	40	898	328	2,094	1,199	1,147	3,897	671	430	6	1	21	4	208	35	22	124	92	35	-	-	3	1	20	3	-	8	-More than 2	10	-	-	-	-	8	1	-	1	-Unknown	116	9	-	10	8	1	21	50	17	-

October 20, 1975



MIRABEL AIRPORT

Mr. Cossitt: Did the Prime Minister say at the opening of the new Mirabel Airport: "The Torontonians will be down here on their knees" and, if so (a) for what reason did he make the statement (b) what is the full meaning of the statement (c) was it meant as a public affront to the people of Ontario and Toronto in particular?


Mitchell William Sharp: See Beauchesne's Parliamentary Rules and Forms Citation 171(1).



QUESTION PASSED AS 1 ORDER FOR RETURN

Mr.   J.-J. Blais@Parliamentary Secretary to President of the Privy Council: Mr. Speaker, if question No. 1,583 could be made an order for return, this return would be tabled immediately.



PRESIDENT OF CIDA

Mr. Jones: 1.	Under the rules of protocol, does the President of CIDA take precedence over the Prime Minister and/or Cabinet Ministers in certain foreign countries?
2.	Are the citizens of certain foreign countries led to believe that the President of CIDA is supreme over the Prime Minister and/or Cabinet Ministers?
3.	(a) What are the responsibilities and duties of the President of CIDA (b) how many persons are on his personal staff (c) what is the total staff of CIDA?
4.	(a) What is the name of the President (b) on what date does his appointment expire (c) what is his salary?
5.	(a) What are the names of all employees of CIDA (b) what are their salaries?
6.	What persons, firms, companies and organizations, have received monies and/or contracts from CIDA and what are their names, the amounts of the contracts and the officers and personal shareholders or owners?
7.	(a) Through what Minister does CIDA report to Parliament (b) on what date was the last report tabled (c) on what date will the next report be made?
Return tabled.


Mr. Blais:: I ask that the remaining questions be allowed to stand.


Thomas Charles Cossitt: Mr. Speaker, I rise on a point of order to do with the first three questions on the order paper, Nos. 28, 62 and 69, which I placed on the order paper on September 30. They were on the order paper in the previous parliament, and remain unanswered. Two questions concern the Prime Minister. One has to do with designers, architects and others who have been employed at heavy public expense on projects at 24 Sussex Drive. Surely the answer to that question is straightforward.
The second question deals with the numerous journeys the Prime Minister has made at public expense. The answer to that too, I should think, is straightforward. The
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third question concerns my constituency: the Post Office Department moved the post office from premises in the village of Lyndhurst, for which the rental had been $120 per year, to similar premises for which the department pays $5,500 per year. Such a rent increase may not seem important to the high-spending people opposite, but I suggest that when the rent goes from $120 a year to $5,500, something smells.
That question should have been answered long ago: it has been on the order paper for a year and a half. I have raised these matters a good many times, and I suggest that the parliamentary secretary or the Prime Minister (Mr. Trudeau)-who has left-ought to tell us why these answers have been outstanding for so long.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Friday, October 17, consideration of the motion of Mr. Macdonald (Rosedale) that Bill C-73, to provide for the restraint of profit margins, prices, dividends and compensation in Canada, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, the government white paper opens its text with this deathless prose saying "Canada is in the grip of serious inflation." The government has suddenly discovered inflation. On Friday, during the short time available, I asked what were the reasons for the government's apparent volte-face\ what were the reasons behind the government's flip-flop, as it were, with regard to an incomes policy or wage and price controls? To include rents as well-


The Acting Speaker (Mr. Turner (London East)):: Order, please. I ask hon. members to carry out their conversations behind the curtains and allow the hon. member for Edmonton West (Mr. Lambert) to continue his remarks.


Marcel Joseph Aimé Lambert: Mr. Speaker, I know that important government decisions must be taken, but not here on the floor.


Walter David Baker: They are usually ad hoc.


Marcel Joseph Aimé Lambert: They are ad hoc. For all we know, they may be contemplating a tax change right now, as happened suddenly not long ago when the decision to change an excise tax provision was made in this House during conversation.
I want to know whether this is a bona fide policy or whether the government's sudden change was motivated by other reasons. Why did the Prime Minister (Mr. Tru-

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deau) suddenly furnish leadership and seize on controls as a means of fighting inflation? It seems as if the government suddenly discovered inflation. On Friday I canvassed the reasons as to why the former minister of finance may have resigned. I am glad to note the presence of the hon. member for Ottawa-Carleton (Mr. Turner) in the House, because I will ask him to do something which he owes this country. I will ask him to participate in this debate and tell us precisely why he resigned his position as minister of finance.


Some hon. Members:: Hear, hear!


Marcel Joseph Aimé Lambert: After all, the former minister went out on hosannas of praise sung in the press and elsewhere. We want to know if he advocated a program of full controls after he came from the meeting of the World Bank, and if there was a dispute between himself and the Prime Minister. After all, the Prime Minister and the former leader of the NDP, ably abetted by the media which had not reflected deeply enough on the question at the time, were not in favour of anti-inflation controls. During the last election campaign it was felt that the smart thing to do was to knock out the concept of an incomes policy. The media went chasing some red herring which the Prime Minister wanted them to chase. Nevertheless, the policies at issue in the 1974 election campaign had to do with the deficiencies of this ministry; they had to do with the budget brought forward by the hon. member for Ottawa-Carleton, on which the government was defeated.


Walter David Baker: The budget failed.


Marcel Joseph Aimé Lambert: The budget failed lamentably. Therefore, why was there this sudden change in October? I suggest that perhaps this is an effort merely to divert public attention. If there was a quarrel within cabinet which forced the hon. member for Ottawa-Carleton to resign, then this is a beautiful diversion of attention. The newspapers, radio, television-just about everybody-are ignoring precisely what happened in the cabinet.


Robert Lorne Stanfield: Ask him once more to speak.


Marcel Joseph Aimé Lambert: The request has been repeated for the hon. member for Ottawa-Carleton to speak. I hope we shall hear him in this debate. He is a good man. I believe him to be an honest man. I think he must give an honest answer regarding the proposals incorporated in this bill.


An hon. Member:: Speak to the bill.


Marcel Joseph Aimé Lambert: I hear someone say, "Speak to the bill." We are speaking to the bill, the principle of the bill. I am not nit-picking, but unless there is this opportunity-


The Acting Speaker (Mr. Turner (London East)):: Would the hon. member please address the Chair?


Marcel Joseph Aimé Lambert: Of course, Mr. Speaker; I will not neglect your august presence. But hon. members opposite want us to become involved in, shall we say, the shallow details of this mean and miserable bill. I will say this: we advocated the principle of controls, and still do.

Let us consider what inflation has been like since this administration under the present Prime Minister took over. In June, 1968, the CIP was 120; in September of this year it was 189.3. Let us see how it has moved. In 1970 it was 129.7; in 1972, 139.8; in 1973, 151; in June, 1974, 166.7. After the right hon. member and his cohorts in the Liberal party won the election in 1974, it went to 176.6 in January, a period of six months. In February this year it was 178; in June, 184; in August, 188.4; and in September, 189.3. Inflation has been with us for a long time.
In 1969 the Prime Minister made a dramatic appeal over television on the subject of inflation. That campaign soon died. In 1971 the Prime Minister said that inflation in Canada had been stopped. We have had all sorts of statements from the right hon. gentleman saying that the government's chief task was to wrestle inflation to the ground. It has not done a thing to achieve that end. Look at the statements made by the former minister of finance. Did he speak about the need for controls, in his June budget, on inflation? Inflation was going ahead at its fastest rate from June, 1974, to June, 1975, right through the February budget into the June budget, but no real steps were taken to fight it. There was a bit of a tax cut and the odd fiscal measure, but nothing very serious. The results show on the charts. If hon. members doubt what I have to say, my figures come from the Bank of Canada monthly report.
I have here a transcript of the proceedings of the 1970 Standing Committee on Finance, Trade and Economic Affairs, a committee in which there was a Liberal majority. Today, the Prime Minister and the Minister of Finance say we have to break the inflation psychology that exists. That is why we have this bill. Certain aspects of it are made to appear harsh. We are now to get a great sales campaign. The Prime Minister leaves tomorrow morning for various parts of the country and we will not see him until some time next week. We will hear ministers talking about the dangers of inflation psychology. They will say that the public was not aware that we had inflation, that they got caught up in this and it must be the objective of the government to try and deal with inflation.
Two years ago, most of the inflation that we had was imported. Now it is due to a cost-pull: wages, salaries and revenues have been too high. It is not a case of demand-pull. We know that a great part of Canadian industry is lying idle and that there is less than our full potential being used. Unfortunately, I do not have here the membership of the committee; however, I do know that the hon. member for Windsor West (Mr. Gray) was the chairman. I cite as follows from page 392 of the Journals of parliament dated February 6, 1970:
Today's inflation has tended to institutionalize itself as a persistent and would-be permanent guest in our system, through, among other factors, the widespread development of an inflationary psychology.
This government was told by its majority-dominated committee in February, 1970, that there was an inflationary psychology. What have they done? In 5V4 years they have done precisely nothing except feed that inflation. In February, 1970, the CIP stood at something less than 129. The figure for June was 129.7. The last figure, for September, was 189.3. That is an increase of 60 points, or 50 per cent inflation. There has been an increase in prices since
October 20, 1975

1970 of 50 per cent. Is that satisfactory? Is it satisfactory that the government has not done anything in that time? However, we are now getting this spinning of wheels, revving of motors and dashing off in all directions at five minutes to midnight.
No one has talked about unemployment, the second bugbear or characteristic of a sick Canadian economy. There is overly high unemployment, more than 7V4 per cent at the present time. What will it be by next February? We have not had one indication in this white paper or in speeches of the Prime Minister, the Minister of Finance or any other government spokesman as to what they propose to do about unemployment.
In September, the former minister of consumer and corporate affairs, the hon. member for Windsor West, made a speech to the Rotary Club in Windsor. As is the habit of former ministers, they send out their speeches. The former minister keeps talking about his antiprofiteering bill, saying it was the great thing in the armoury of the government. He proposed it in 1972, and it died amoaning. It was again proposed, in a different form, but it did not see the light of day. It should be brought forward again. This was done on behalf of the Liberal party even though that former minister is very critical of government policy or government inactivity with regard to inflation. Yet on the basis of advancing the cause of the Liberal party, the hon. member for Windsor West calls for an antiprofiteering bill, one which is even tougher than the bill he introduced. Is there mention of an antiprofiteering bill? Not that I very much care for one, but that is what the government said it was going to do.
What are the fiscal and monetary measures which the government would propose? Are there to be any incentives to productivity? There was a great deal of talk in the speeches of the Minister of Finance and the Prime Minister about a decline in Canadian productivity. Let them go back to that committee report of February, 1970. They will find the committee members, including the majority Liberals, talking even then about a regrettable decline in Canadian productivity and saying it was one of the major causes of inflation.
The great issue at that time was high interest rates; that is what motivated the government in naming this committee to look into inflation. Back in 1969-70, as the committee reported, interest rates were around 8.5 per cent. But today, as of October 15, interest rates are 9.52 per cent. On October 1, the federal government's long-term investment rate had reached 9.84 per cent. This is a clear indication of the inability of hon. gentlemen opposite to deal with inflation.
The average coupon rate on Government of Canada Savings Bonds is priced to yield 9.38 percent. Imagine the federal government borrowing those hundreds of millions of dollars and having to pay that kind of coupon rate. And this is not just for today; it is for the long term-the life of those bonds. What sort of a yoke are they fastening on the neck of the Canadian economy when the government puts us into a strait-jacket of that type, probably for the next nine years? I have not seen the bonds, but I assume they will mature in nine years. It means that high interest rates
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are going to be with us for a long time. Invest in mortgages at rates less than 9 per cent, when 9.5 per cent is being paid on government bonds right now? Who is fooling whom? Those high interest rates will remain with us as long as the present government is in charge of economic policy.
As far as this bill is concerned, we support the principle of control. I certainly did so to the best of my ability and with my full strength during the last electoral campaign; and with success, because the people understood when one talked to them about the wastage and cancer of inflation, its effect upon their incomes, their bond holdings, their private pension plans, and so on. Imagine a schoolteacher going out on pension in 1968 with the CIP at 120, and today facing 189.3. Mr. Speaker, that is worse than highway robbery. We throw robbers into jail; sneak thieves go to jail; but the biggest sneak thief of all has been the Government of Canada-


Some hon. Members:: Hear, hear!


Marcel Joseph Aimé Lambert: -for permitting this to go on while, all the time, hiding their heads in the sand. True, they offered a band-aid here and there. But what was done for pensioners, what was done for retired people living on their hard-earned savings, those whose resources were being eroded? From time to time the government came forward and announced grandiloquently that they were increasing pensions or supplementing them in accordance with the cost of living index. What cynicism, to carry on in that way!
The bill before us sets up a big, new agency. Already we are seeing it in the process of expansion. The chairman is saying things which make the vice-chairman wince with pain. We are likely to see an interesting performance there. Here in the House, one minister is saying that wage increases of 38 per cent and 40 per cent qualify under the guidelines, while another is saying no, they do not. Then, again, this bill provides for a period of 3Vi years, long enough to get the total economy wired into a system from which it will never emerge: it will never come out after 3 V2 years.
Moreover, there is power in the legislation, subject to the approval of parliament, to enable those controls to be continued further. An opportunity will be provided for an even more synical performance of the kind for which the Prime Minister is noted. Some three months before the 1978 election the controls will come off or it will be announced that they will come off at a date close to the election, not during the election, because we know there would be certain repressions which would burst forth at that time. Mr. Speaker, at the end of 18 months surely parliament should be able to review this program.


Some hon. Members:: Hear, hear!


Marcel Joseph Aimé Lambert: After all, why cannot the government take parliament and the Canadian people into its confidence? The government is imposing this particular economic program, these heavy controls, controls that the Minister of Finance says are absolutely frightening and which are going to frighten us for 3'/2 years. Parliament should say no to that, and so should the Canadian people.

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What is required is a careful analysis of the situation at the end of 18 months, so we can decide where we have gone. Obviously, there will be some errors made. It is a tough program. I am quite honest when I say that had the Conservatives won the election in 1974 and introduced our system of controls-the 90-day freeze and then a short period of controls-there would have been mistakes; there would have been some difficulties. After all, we could not get into the blessed mess that we are in without it costing us something to get out. If the situation were so simple that there would be no problems, then the art of government would be extraordinarily easy. But that is not the case.
This House will ultimately, undoubtedly, pass this bill in principle so that it can go to committee to be examined in detail. We will then see the proof of the pudding. The bill is being sent to the finance committee, but I can assure the House, Mr. Speaker, that it will not be just government officials who will speak to the committee- not likely. The minister has already confused everybody, including himself, and has he done so just to confuse the committee?
I am sure that organized groups, farmers, manufacturers, many walks of life both organized and unorganized, will want to let the committee know what they think about these controls and some of the dangers. I hope their criticisms will be constructive. But there will be criticism and it will take some time to express. I hope we can arrange our work in this way so that those people who are vitally concerned with this problem of administration, on both sides of the House, will be able to devote appropriate time to the matter; that we will not have piled on to the committee more and more work so there is pressure to work morning, afternoon and night, week in and week out, so as to hide and obscure, as is often the case when government tries to ram through a measure.
Having said that, Mr. Speaker, I hope that in his reply the Minister of Finance will be forthcoming in regard to some of the questions posed by my colleagues and others in the House. We say that inflation is so bad that we must have the most straightforward honesty both from the Minister of Finance and from the Prime Minister. And last but not least, we must have an honest expose of what went on by the hon. member for Ottawa-Carleton when he was acting in his capacity as minister of finance.


Miss Flora MacDonald (Kingston and the Islands):: Mr. Speaker, may I say at the outset that I am relieved that the government has at last faced up to its responsibility to do something about inflation. This certainly is not the occasion to reiterate the arguments that we have been putting forward for so long calling for positive, strong action. Suffice it to say that we welcome this declaration of intent.
Our hopes were raised many months ago when the Prime Minister (Mr. Trudeau) said, and as he has repeated so often, that he would wrestle inflation to the ground. Well, that announced that the match would be held, but unfortunately the date was never set. At last the government has entered the ring. That is good and necessary. But I cannot help wondering, Mr. Speaker, if you will allow me to prolong the analogy, just what the government has been doing during the training period, this long, long training

period. Obviously, the government was not doing roadwork. The provinces, the unions, business-none was brought in on the preparations.
Nor do we have any evidence that the government was even doing exercises at home in preparation for the fight. Indeed, the entire plan so far revealed has every mark of being put together in considerable haste. What we have before us is obviously the result of the burning of midnight oil for a period of about three weeks or so, probably since about September 26 when the new Minister of Finance (Mr. Macdonald) moved into Place Bell Canada. Could it be that when he moved in he could find no contingency planning, no strategy for the forthcoming match, not even a few notes on a blotter?
Of course, that raises the still unresolved question-just referred to-of why one of the seconds left the team before the bell rang. We still have not had a proper account of what lies behind that change in the line-up. In my view, an explanation is owing, and badly owing; but that is another matter which I hope will be answered by the former minister of finance.
We certainly had no idea that the fight was coming soon, in view of the government's diet during the training period-salary increases, complement increases, a quarter of a million dollars worth of smoked salmon and champagne to open Mirabel, regret than $400 million will not be spent at Pickering, with the suggestion that other places will be found to spend the money, and an absolutely shattering deficit as well. No, Mr. Speaker, there was no dieting, no trimming of fat, in preparation for the wrestling match. I suppose the idea was to go in heavy, to gain as much weight advantage as possible.
Why, then, did the government also feed its opponent? Why make the contest more difficult? Why increase, for instance, so dramatically the price of fuel? Did we really have to add to rising costs everywhere for home buyers and businessmen by putting up the interest rate so high? Did we have to go so deeply into the money markets that private borrowers are finding the pot dry or the price far too high?
However, that is past; we now come to the day of the big event and the bell has rung for the first round. And what a fight it is going to be. It will be a long one, Mr. Speaker, a very long one. There is no expectation of an early decision. There is no indication or suggestion that once inflation is on the mat it can be pinned quickly so we can then turn our attention to other matters. We have been told by the Prime Minister that it is going to be more than three years before the referee is asked if the fight should continue, and that worries me very much.
I worry that the powers granted will be kept by government. I worry that what is being done to meet an emergency may turn into a way of life, a continuing condition of being Canadian. I worry that the free forces that have helped us reach the prosperity we have will be forever checked as a result of needing regulation at this particular time. I plead with the government to give us some concrete and meaningful assurance that parliament will be able to review these powers, not three years hence but six months hence or at least a year hence. We had problems enough with one War Measures Act; let us not make this a parallel in the "war against inflation measures act."
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An hon. Member:: Let's not make jokes.


Flora Isabel MacDonald: It will be no joke if you have to live under those kinds of regulations. The granting of powers such as these to the government is, and should always be, recognized as an extraordinary measure. Let us demonstrate this. Let us show the people of Canada that this is a temporary measure, not a new government program of indefinite or interminable duration, and that the form of this legislation makes this very clear. The bill should not be proposing a major change in the economic and social structure of the country. It should not be using a temporary crisis brought about in large part by poor fiscal and monetary management by the government to give lasting and sweeping powers to the government.
Neither should a special bureaucracy be created to administer this legislation. Surely that can be done in a way that will not add yet another increase to the permanent civil service. Let us do it right. Let us not leave any room for false impressions. For once, let us see that the action matches the intention.


Some hon. Members:: Hear, hear!


Flora Isabel MacDonald: The proposals my party put forward, and which I supported, called for a timetable of controls and an early cut-off point. This is vital and is a condition for the support I would give the government's current plan.
I have another concern, Mr. Speaker, and that is about how tough a fight we can expect. As you know, our party's proposal was for a short but total freeze to be allowed by selective and limited controls and only for the duration necessary. This was a program, in other words, that would move from comprehensiveness to flexibility and then to abolition. That is not what the government's current proposal provides. This bill before us starts with an array of guidelines and exemptions. It moves from flexibility to rigidity with no provision for parliamentary review or even analysis of the saliency of the program, and regardless of a flexible approach at the outside, imbedded within this bill are provisions that can be activated at any time the government chooses, which will give it unprecedented regulatory powers in peacetime.
The government has chosen to start with a soft approach. If any program is to beat inflation, it must be seen to be tough. The government must convince the people of Canada that the program will initially in fact stop the inflationary cycle. The climate of the expectation of inflation must be broken. That is what the Prime Minister said the other night, and I agree with him on that particular point.
If the inflation psychology is to be beaten, people must be convinced that inflation will be beaten. They will never believe that if they see exemptions being made for a range of special cases. I fear that greatly, because if some people escape the net and get higher pay raises, or if some companies can put up prices and get away with it, people just simply will not believe that the program will work, and they will have very clear evidence that they are still falling behind and will continue to want and demand more, and in all likelihood they will need more.
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I can imagine some of the very difficult decisions that will have to be taken. It is not easy to be tough; and let there be no mistake, being tough will sometimes mean being unfair. But unless the government is tough, it will never convince people that they should discipline themselves to the controls and that they will not be doing themselves and their families a disservice by following the law.
I think it is dreadfully unfortunate that this program has been launched in a way that seems to maximize confusion. Hardly anyone knows how the controls will affect him or her. Each and every exemption the government introduces increases the confusion. We, absolutely, must get clarity and certainty and we must get it fast. I call on the government to be strong and to show, in the really hard decisions it will have to make, that it has the power and it has the will to win this battle. Let it be seen to have determination and confidence in the course it has undertaken.
This will mean that its decisions will not always be as fair as we would normally expect. It will not always be fair to stop some price rises, but we must. Exceptions for some pay raises may look equitable, but to allow them will destroy the whole program. Many inequities exist today and they are suffered mainly by those who do not have great power; those who are unlikely to benefit from any exemptions that will be asked for or achieved.
Tough controls will mean rough justice, as my leader has said. That is just another reason why controls must be of short and limited duration. If the people of Canada anticipate years and years of the exercise of these powers, they will not put up with unfair treatment. If they can see light instead of dark at the end of the tunnel, and if they are convinced that remedy is not indefinitely postponed and that a wait of a limited period will allow redress in an atmosphere from which inflationary expectations are removed, then it will be possible to live within guidelines even when it means suffering temporary and relative disadvantage.
I suggest that the government will incur support if it adheres to a strict interpretation of the legislation, but I predict that it will incur a failure of the program, a loss of the fight and a collapse of confidence if the hard decisions are not taken.
There are many specific items in the bill before us that require careful attention. My colleagues will deal with many of these. Before continuing with my general remarks, I should like to comment on one specific area that does not appear in the legislation but is in the white paper, the action plan, and I refer to the area of rents.
The government will ask the provinces to take action. It has been suggested in the white paper that rents be allowed to rise to some as yet undetermined percentage increase. Beyond that, increases must be justified by demonstrated rising costs. New rental accommodation, as is stated in the white paper, that has no history of rental contracts is exempt for five years. Why is it exempt for five years? Is that the real horizon for this program? Is that what the government means?
I also want to know how the allowed percentage increase referred to will be decided. Obviously, this is an area within the jurisdiction of the provinces, but this is
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October 20, 1975
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also a problem that is real, pressing and urgent all across Canada. There are few of us in this House who have not had the problem of rents brought forcibly to our attention. The provinces have repeatedly urged the government to take a lead in this fight against inflation.
I hope the government will not duck its mandate in the area of rents. Certainly, the provinces have prime jurisdiction, but the responsibility for leadership rests here in Ottawa. In this connection I hear rumours that the Minister of State for Urban Affairs (Mr. Danson) may convene a federal-provincial meeting to discuss this specific subject. This must go ahead. Surely this is an opportunity not to be missed.
Please don't let us hear, in effect, that the confusion in which that ministry has just been thrown by a restructuring of its hierarchy necessitates the passing up of this responsibility. Let us not say that the ministers of finance can handle this little item. It is a housing matter and should be dealt with by the ministers responsible for that function.
Is the government prepared to act like a government for Canadians, or will it once again relegate housing to a tag-end item for the financial mandarins? Will the Minister of State for Urban Affairs be given a chance to do his job, or will he have to keep sitting where this government's order of precedence puts him-on the sidelines? The answer to this question will tell Canada what priority this government really gives to one of the three essentials of human life-shelter.
This leads me, Mr. Speaker, to some of my broader concerns about the program that has been presented for our consideration. Everyone knows that inflation is not an indivisible, single-based problem. There are sectoral factors that must be considered. Housing is certainly one of those. Supply of accommodation, not just greed of landlords and owners, is the root of increasing housing costs. And in a major degree the supply of housing is determined by the effective cost of mortgage money. We now have mortgage rates that border on the usurious and put home ownership beyond the hope of all but a few. Those same rates make it uneconomic for business to build rental accommodation.
Does anyone here know of any unsubsidized rental housing being built, for instance, here in Ottawa? I can tell you that the amount of such construction across Canada is completely inadequate to meet the needs. Rent control will not solve the housing problem. More housing will. But that depends upon mortgage money being available at reasonable cost and in sufficient supply. The antiinflation package is incomplete until it solves this problem.
What are the government's plans? Which of the many alternatives available does it propose to pursue? I have already suggested a range of programs that could be used. Mortgage interest payments over a fixed per cent-I suggest 8 per cent-could be deductible from income for tax purposes. Mortgages for new starts can be subsidized down to a fixed rate-here, again, I suggest 8 per cent- and an upper limit for each mortgage should of course be established. An investment tax credit could be given for funds directed entirely to mortgages. To help ensure the

supply of serviced land, a fund could be established to provide low-cost loans to help municipalities in servicing and developing land.
We need to know what the government intends. Veiled and hazy comments about pleasant surprises to come are insufficient. Here, clearly, is a sector where specific, I might almost say concrete, government action is called for. We have heard rumours that new housing initiatives will be forthcoming. We await the completion of the dance of the mandarins to hear what they will tell the minister to say. But be forewarned. If the new strategy tries to take credit for the recycling of the approximately $300 million already budgeted but not yet allocated from Central Mortgage and Housing, we will see through the deception. The problem cannot be settled by a rehash; it requires new thinking and new commitment.
The debilitating effect of interest rates has crippled not only the housing sector but is also a major contributing factor in perpetuating our prolonged economic slump. Business just cannot afford to invest in plant and equipment at current rates of interest; the need for working capital must go unfulfilled. We must know what monetary policies the government intends to pursue. Legislated controls are now necessary to fight inflation, but the rest of the government's weaponry must be brought to bear-and we must know how it intends to use these weapons.
Without a substantial improvement in the growth of our real national output, the attack on inflationary pressures can only achieve momentary success at best. What plants, what incentives, what help does the government propose to increase productivity? Our economic malaise requires clear and direct action. Our productivity declines; perhaps most importantly of all, it declines in comparison with our trading partners. How long does the government intend to allow our relative competitiveness to fall back? Sure we import some of the world's inflationary pressures, but how long will we compound this folly at home? Unless the anti-inflation packages deals with this problem, it is woefully incomplete.
How does the government intend to get the economy moving? Our plants are working far below capacity. We have hundreds of thousands of unemployed. This cannot be ignored and it cannot be solved by the government's usual answer of printing more money. What fiscal policy will be used? We hear that government spending will be restrained. Where, and how? The details of this aspect of the government's program are just as important as the details on the operation of controls.
How will the deficit be brought under some reasonable control? A strong policy of spending restraint, with detailed guidelines, must be instituted immediately. The President of the Treasury Board (Mr. Chretien) must act, and he must tell us immediately what that action will be. I have said that I want to support the government in its anti-inflation program, but that program must be a totality. No single initiative, however laudable, will suffice. I challenge the government to unveil the rest of its program.
Mr. Speaker, the country is looking for strong and immediate leadership in the war against inflation. But it also wants assurance that we are not about to see another 100 years war. I am skeptical that the weapons for battle
October 20, 1975

are provided by this legislation; I am fearful that the prolongation of the war is imbedded in this bill.


Mr. B. Keith Penner (Parliamentary Secretary to Minister of State for Science and Technology):: Mr. Speaker, having been out of action in the debating ring for a while, this is my first venture back into it and I assure hon. members that my comments in respect of Bill C-73 will not be unduly long, so that the leader of the New Democratic Party (Mr. Broadbent) will be able to be heard very shortly.


Lorne Edmund Nystrom: Can he have some of your time?


B. Keith Penner: Certainly. I should say at the outset that all the many arguments that have been made in the past against economic controls probably could well be repeated in the debate on this bill and would still have a considerable amount of validity, depending on how those arguments were made. I made many of those arguments myself, having served on the committee on trends in food prices and having used them during the election campaign of 1974. I refer to such reservations as the possibility of very serious inequities resulting from a comprehensive policy of controls or even a limited policy of controls.
There is also the very great likelihood that controls could cause very serious dislocations in the economy, particularly on the supply side. I think these are some of the major reasons the government, quite properly, delayed making this momentous and even drastic decision until this time. The question now is why, at this moment, has the government made such a decision? I should like to come back to that point a little later. First, let me refer to my own view of controls. I have already indicated that I have argued against them. I still have reservations concerning them as, I believe, do many members.
During the late summer and early fall certain experts in our society began to look at the economy as it was functioning and a number of them reached a very radical decision about what must be done. I refer particularly to one man who influenced my thinking in this regard, Mr. Ian Macdonald, president of York University. Mr. Macdonald, who served as deputy treasurer of the province of Ontario, made several important speeches during this past summer and early fall. He emphasized, in a most convincing way, that now is the time for immediate wage and price controls to be introduced.


Walter David Baker: Did he mention John Turner?


B. Keith Penner: You would have to ask the hon. member about that. At the moment I am talking about what influenced me. Mr. Macdonald said that to do nothing is to accept the harsh reality that we could have 10 per cent unemployment and 15 per cent inflation this winter. He indicated that he came most reluctantly to this decision about the need for wage and price controls. In his view, however, this was necessary in order to curb far more serious problems in our economy than we have at the present time.
I think this is the view that is now shared by the government. The government has reached the decision that we are entering at this moment a completely new
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economic era in Canadian history, and that unless strong measures are adopted and followed we could be heading for economic and social upheaval. The white paper which was introduced earlier expressed it very well in the following words:
If this inflation continues or gets worse there is a grave danger that economic recovery will be stifled, unemployment increased and the nation subjected to mounting stresses and strains.
I have referred to the apprehension which members of parliament and others feel about controls. We know that there will be many vexations and annoyances as a result of this policy, and frustrations as well. Members of parliament will have to deal with these on behalf of individuals and groups in their constituencies. But the real question with which we have to struggle now is whether it is preferable that we live with these feelings and attitudes with respect to controls-feelings and attitudes which are not desirable and nobody would wish to encourage them- or to face what otherwise could take place, namely, economic and social chaos.
My most immediate concern about the selective controls policy of the government has to do with the transition period. I listened carefully to the hon. member for Kingston and the Islands (Miss MacDonald) who advocated that the government be tough, that they take as hard a line as they possibly can and not yield to any kind of concessions that some groups in our society may feel that they can justifiably make. I am not able to adopt such a hard-line approach; it seems to me to be callous and rather unfeeling and not to take into account that there are groups in our society who are caught in a very difficult situation in this transition period.
For example, there are groups that have been in the process of bargaining with their employers. These collective bargaining negotiations have either broken down, or in some cases have continued but without much progress having been made. Surely some consideration has to be given to these people, and some flexibility has to be present so that they will not find themselves largely out of step with their fellow workers.
I am thinking, in particular, of the pulp and paper workers in northern Ontario. Many of these people have been trying to bargain in good faith for what they estimated the industry could afford to pay them. They were looking at the expected profits of the industry, and I think they bargained as best they could. The industry, however, decided that they were going to take a strong stand and as a result there were very few settlements. Now the workers find themselves caught in this transition period. What are we to say to them? That they should not continue with their bargaining; that it is all cut and dried; that it is set; that it has been decided for them by the government? Or should we, rather, look at what the white paper says, namely, that there is some room here, some flexibility, taking into account historic patterns and relationships, so that they do not have to fall out of line with their fellow workers?
There is another group caught in a similar situation- the secondary school teachers in the province of Ontario. They find that their colleagues who are elementary school teachers have made settlements. There has always been a
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salary relationship between those who teach at the elementary level and those in secondary schools.


John Edward Broadbent: You have a conflict of interest there.


B. Keith Penner: Who does not?


Some hon. Members:: Oh, oh!


B. Keith Penner: The conflict is more apparent than real, at the moment anyway. I am concerned that this relationship between settlements which elementary school teachers have made already and what secondary school teachers have expected should follow through.
Probably it could be asked, why are we in the federal parliament talking about secondary school teachers, since this is a provincial responsibility and the provinces will have to work that out, being aware of the federal guidelines? However, we know that in the province of Ontario, at any rate, the problem will be thrown squarely upon us because of the current political situation in the Ontario legislature. This is bound to be a political hot potato, but they have decided to throw it our way and let us solve it- or, more properly, the Anti-inflation Review Board must solve the problem.
So, then, here is another group of people who are in a difficult situation, and I do not think we can take a hard-nosed attitude such as that taken by the hon. member for Kingston and the Islands and allow inequities to exist because we want to be tough and because if we do not, the program is bound to fail. I do not take that position at all. I think there are good grounds for certain exceptions to be made in the transition period because, as the white paper says, there are long-established, historic relationships between wages of closely related groups and other special cases of equity. This seems to be a catch-all phrase which means that if the Anti-Inflation Review Board is fair and takes into account the good arguments that can be made by, for example, the pulp and paper workers and by the secondary school teachers in Ontario, then there will be some room in this transition period to remove some of the inequities about which I am concerned.
I will turn now to the principle of Bill C-73 and to my thoughts on controls. I have indicated already that some of my thinking has changed with respect to controls, and I mentioned the arguments of Mr. Ian Macdonald.


Some hon. Members:: Oh, oh!


John Edward Broadbent: I hope so.


B. Keith Penner: If it is a sin or a crime to be a thinker, then I am guilty.


Donald Stovel Macdonald: Hear, hear!


B. Keith Penner: During the summer I read the speeches of the president of York University, a man whose credentials, it seems to me, are good ones. Members of parliament would be well advised to read what he has said. In addition, I read the OECD report on the Canadian economy, which was another factor that influenced my thinking about the need for something drastic to be done with respect to the Canadian economy, some kind of shock

therapy that needed to be introduced in order that we could do something about the serious economic situation.


John Edward Broadbent: Shock therapy frequently kills the patient.


B. Keith Penner: I will be listening to the leader of the NDP shortly. I am always interested in what he has to say, and I will listen to him carefully. I find it difficult to hear what he is saying now over the sound of my own voice. If he wants to say something, I will pause for a moment so I can hear him, or perhaps he could make his comments later.
The other document that influenced my thinking was the report on Canada of the Organization for Economic Co-operation and Development. This report refers to the decline in real output in Canada during 1975-something that has been talked about a great deal-and the fact that productivity has fallen. I do not know all the reasons for productivity having dropped; how much of it is due to what goes on within the factory or plant and how much has to do with the kind of markets available to Canada. At any rate, there is a decline in real output, and this is serious. The report talks about the likelihood of unemployment rising to over 8 per cent, and of course everyone is concerned about that.
There is the possibility of a huge trade deficit. The OECD report talks about a deficit that could go as high as $5 billion or $6 billion, compared to the $1.2 billion of 1974. It is futile to lash out at the government for this trade deficit because we are all aware of the factors that have brought it about: those nations which had to spend an increasingly high proportion of their national income on energy have had less money available for the other things that we would have liked to sell them. There is no point in blaming the government for this situation. It is a problem that we have had to live with and it is part of this new economic era that has been referred to which calls now for some kind of radical policy, a shock therapy policy.
Part of this debate on Bill C-73 revolves around the question of whether controls are warranted now, when they were not warranted before. I think the answer to that question is clearly yes, they are warranted now and they were not warranted previously. That is because of the combination that was referred to in the OECD report-a large external deficit, rising unemployment and sluggish economic activity, together with stubbornly high rates of inflation. It is the latter factor that helps complicate the whole situation-overreach and overkill are aggravating all the other negative aspects within the economy and therefore it calls for strong, decisive, determined government action so that the psychology of inflation can be brought to a halt.


Walter David Baker: Are you not really saying the government was wrong in 1974?


B. Keith Penner: You were not listening to my comments.


The Acting Speaker (Mr. Turner (London East)):: Order, please. Please address the Chair.
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B. Keith Penner: I said quite clearly, Mr. Speaker, that a combination of factors has warranted the action of the government at this moment, when that same action was not warranted previously. If I have not made this argument to the complete satisfaction of the hon. member for Grenville-Carleton (Mr. Baker), I will have to let it go and let other members attempt it.
The OECD report emphasized that while a voluntary period of restraint is clearly preferable-and that is the view that the government took-it may be desirable to use legislation if agreement among the parties could not be reached quickly. That is exactly the situation that occurred: a determined effort, a hardworking effort was made to bring about voluntary restraint, but that did not work so the government took the next logical step, which was to introduce legislation. That is exactly what the OECD report recommended ought to be done in Canada.
The report goes on to say that although there are inevitable difficulties in introducing a prices and incomes policy, the general economic environment should be more conducive to the successful operation of such a policy now than has been the case for a number of years. So the argument can be made, and we can meet it head on, that there are good and justifiable reasons for this kind of economic policy now, when there were not as good and justifiable reasons six months or a year ago. I think there are. The government does have the supporting argument that now is the right time for controls, when such might not have been the case in the past.
It has been pointed out by some that the economy is now on the upturn, that there are some factors which indicate that productivity is up and that the gross product will increase. Then why do we need controls at this time? Is it not the wrong time to bring them in, when there are some signs that we are in an upturn: surely, some have said, it would be better to have a continuing laissez faire economic policy with respect to incomes and prices, and the end that we all want to see achieved will come naturally. If I may return to the OECD report, it suggests that increasing economic growth is not at all incompatible with anti-inflationary policies; in other words, they do not work against one another but they can work together. They are compatible and can achieve the same ends, and achieve them more quickly. In fact, the two things together-stronger expansion along with an anti-inflationary program-can work to reduce costs and price pressures, particularly if both are associated with marked improvement in productivity. That is a third element, our rate of productivity must increase along with the upturn and the anti-inflationary program.
To a great extent, the success of the government's antiinflationary program will depend on what happens to prices in the supermarket and what happens in the housing sector. These are the final two points I wish to mention. I want this program to succeed, naturally. I want it to accomplish what the government hopes it will accomplish to break the inflationary psychology; to bring us to our senses so that we will not continue to take more out of the economy than there is in it. If it is to succeed, if the citizens of the country are to accept it, its success depends to a certain extent upon what happens in the supermarket and in the housing sector.
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No one disagrees that our primary producers must be encouraged to continue to produce all the commodities we need for our tables and that they must produce them efficiently. I am quite convinced, however, that the consumers of this country want an assurance that the primary producers of Canada will follow the general principle enunciated in the white paper on the attack on inflation; that is, that their increases will reflect only legitimate costs incurred, and nothing more.
Everyone knows that there has been a good, healthy turn-around in farm income in the last number of years and that farmers who were not getting their fair share of the economic pie in the past have now been doing much better. I suppose it could be debated endlessly whether they are doing well enough. At the present time, however, consumers will not be at all happy if the primary producers expect to get more than their own particular increases in costs. If they pass along more than that, there will be a considerable amount of unhappiness.
The suggestion that the Anti-Inflation Board will look at marketing boards should come as welcome news to all of us.


Walter David Baker: To everyone except Eugene Whelan.


B. Keith Penner: He can make his own arguments.


Walter David Baker: He did.


B. Keith Penner: The operation of marketing boards is a relatively new area in Canada. No one is quite sure to what extent they really benefit the primary producer and to what extent they may simply be subsidizing inefficient operations, or even to what extent the consumer is having to pay for all this. I am pleased that the Anti-Inflation Board is going to look at the question carefully, and I think consumers will demand that much from it.
The second area I mentioned is the housing sector. I was impressed with the recent report of the C. D. Howe Research Institute on housing which seriously questions some of the existing housing programs in Canada.


John Edward Broadbent: I can imagine.


B. Keith Penner: When we are talking about housing in Canada, we are talking about a very relative situation. We all know this is still the country with the best housing in the world. I think we realize that we are the best housed people in the world and we should all take justifiable pride in the quality and standard of our housing. If we are not happy about our housing, if we criticize certain aspects of housing, we must criticize it in the context that we have done well in the last few years. This is not to suggest that we cannot do better.
The C. D. Howe report talks about the futility of encouraging demand when the rate of new supply has been declining. It refers to the encouragement being given to first-time buyers. One thing can be said about federal grants to first-time homeowners: they were directed to people in the greatest need. Other provincial programs were more all-encompassing, and as such were hand-outs

October 20, 1975
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to those who did not need that type of assistance. Do we want to encourage demand? Do we want to encourage people already adequately housed to look for something better? I suggest that such a policy of encouragement at this moment, when the rate of new supply has been decreasing, is not good. The C. D. Howe report suggests that governments should do much more to increase the supply of housing and to place less emphasis on the demand side.
The OECD report to which I referred stated that an immediate recovery in the economy would best be promoted by giving priority to residential housing and to business fixed investment. Hon. members no doubt want to hear from the Minister of State for Urban Affairs who is preparing new policies and programs which will do exactly what is recommended by the various reports just referred to.
To sum up, the government's anti-inflation program may be regarded as regrettable, but conditions which make necessary this kind of policy are there. The conditions of overreach, of overkill, have made necessary such a farreaching policy and new intrusion of government into the free market economy of Canada. But the policy is demanded by the circumstances, circumstances which speak for themselves. The transition period will be tricky, and a satisfactory way must be found to resolve any serious inequities. My confidence in the government and in the people who will serve on the review board is great enough to lead me to think that these inequities will be dealt with.
On Wednesday afternoon my colleagues and I will meet with pulp and paper workers of northwestern Ontario to talk about the situation in which they find themselves in this transition period.


Walter David Baker: I hope they share the hon. member's confidence.


B. Keith Penner: I hope so, too. I think there is every reason for them to share that confidence. The government's program must succeed. Its success will be assured if the rate of increase in food prices is moderated, if there is a good supply of adequate housing and if we pass through the transition period without causing inequities which would otherwise be perpetuated well into 1976 and during the remaining period in which the controls program will be in existence.


John Edward Broadbent: Madam Speaker, last Tuesday when I spoke on behalf of the NDP on the white paper I said that in our view the government's proposals for controlling prices and wages were unfair and unworkable. In the last week I have listened carefully to the minister and the Prime Minister (Mr. Trudeau) explaining and justifying the program, and I must say that my conclusion will not surprise my political opponents: I think my original position was right and my party was right in saying that the controls are unfair and unworkable.
In the last 72 hours the minister has made himself readily available to the media, so much so that he has been willing to talk almost at the drop of any microphone, so to speak. For that reason alone, I am suspicious about the government's confidence in their own program. I saw the minister on television, on "W-5". He was on the CBC radio

program "Cross-Canada Check-up". He wrote an article in the Toronto Star and appeared last night, on behalf of the Liberal party, on the television program "The Nation's Business". Yet in none of these programs or articles has the minister really dealt with the crucial questions raised about the controls program. He has not made his case for their need. Neither during the debate so far nor during the weekend has he dealt with the alleged cost-push factor and why we need such controls.
As I say, he did not deal with that at all. There is a two-paragraph reference only to this subject. He did not deal with the issue in terms of increasing labour costs on the one hand, or in terms of our supposed trade problems on the other. He made passing references only to both of these subjects. They surely are a precondition for this kind of program. Nor did he allay fears expressed not exclusively by my party but by a good number of Canadians across this country about the unfairness and unworkable nature of his own proposals.
This afternoon I will not travel over ground I travelled over last Tuesday. Nor will I repeat what the hon. member for Yorkton-Melville (Mr. Nystrom) said on behalf of the NDP. Instead, I shall deal with the principle arguments the minister continues to put forward to justify his program. First, the minister emphasized in his article in the Toronto Star, in his television performance following the national news last night and on the television program "W-5" the same evening, that the program is intended primarily to benefit people on low and fixed incomes. Clearly, that is the message he wanted to convey to the people of Canada. I begin by saying that if the program achieves this, the minister will have done something remarkable; he will have done something to justify the hon. member who just spoke. In other words, the Liberal party will have taken a 180-degree turn and changed its direction of one year ago. I remind the hon. member and the minister that, speaking about this program during the past year, the Prime Minister has said that the group which would be most seriously negatively-not positively-affected in Canada by these kinds of controls would be the weak and the poor. In 1974 the Prime Minister said that these people would be most hurt under such a program.
This specific kind of program was dealt with in general statements made by the Prime Minister. I suggest that the program will most seriously affect negatively, contrary to what the minister has said during the past 48 hours, that same group. About whom are we talking? We are talking about the poor or, to use the words the minister used last night on television, the small people or little people. I do not particularly care about the term, but we know what it means: it means low income people. They are either working poor people or pensioners. Consider how this specific program is to affect such people. First, what is the government doing for workers in the labour market but living at the poverty level? I remind you that the federal minimum wage provides a worker in Canada with only $5,400 annually. Madam Speaker, $5,400 a year is paid for those earning the minimum wage set this government. That, by the way, is $2,400 less than the poverty level for a family of four: the current estimate for the poverty level for a family of four in Canada is $7,871. We now have a federal minimum wage for workers in Canada that is $2,400 below
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the poverty level for a family of four. If the government had wanted to do something about this category of worker, they would have done something directly. They would have at least increased their own minimum wage. However, there is not a thing in the program about increasing the federal minimum wage.
There is no suggestion that the provinces, which are part of the package, should increase their minimum wage. Many of the provinces, which in terms of resources are much poorer than the federal government, have even lower wages. The federal government did not do anything about increasing the minimum wage at the federal level. Nor did they suggest to the provinces that was the least they could do for workers under their jurisdiction.
The proposed guideline of $600 at the bottom level is not mandatory. There is no requirement that all workers will get it. It is only if the workers are lucky. If, for example, they have an employer who is benevolent after the controls in a way that he was not before, and gives the workers the $600 increase, they will get it. However, there is no reason to believe they will get the $600 today if a week ago the employer would not have thought of passing it on to them.
Because the minister has put controls on the trade union sector, the effective following up of wage gains in the non-trade union sector that has traditionally taken place simply will not happen now. The organized workers, whether they be in Atlantic Canada, central Canada or the west, have set patterns for the unorganized workers. By indirect effect, they have caused increases to be passed on to them that they otherwise would not have got. This is because of the initiative taken in the collective bargaining sector.
Precisely because the minister has now put effective controls on the bargaining sector to ensure they do not go above 8 or 10 per cent, there is an even greater likelihood that all those men and women outside the trade union movement will have lower increases than would otherwise have been the case. I repeat, they have no one to bargain for them. With the controls being put on the trade union movement, the example-setting precedent in terms of wage demands has been taken away. The government has indirectly done more harm to unorganized workers because they have not made mandatory increases in the minimum wage at either the federal or provincial level which would have been some kind of compensation.
The second point I would like to make is in terms of the guideline for those firms employing 500 people or less. Everywhere east of the province of Quebec I would guess that between 80 and 90 per cent of firms employ fewer than 500 people. The government has given the moral and legal authority to companies in the whole of Atlantic Canada to keep their wages even lower because most of those companies employ 500 or fewer people. Most of those companies do not have trade unions. The working people have no effective representation in arguing for improvements in their working conditions, including wages. This program will give employers in Atlantic Canada a very effective weapon to keep wages down.
The government should be more concerned about the non-unionized worker in Canada. The Minister of Labour (Mr. Munro) is addressing trade union meetings in
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Ontario and elsewhere in Canada, urging compliance with the program. I am not in any way suggesting that they should defy the law. However, instead of his concentrating on urging them to comply with the guidelines, it would make much more sense if he would travel around Ontario and other parts of the country urging the formation of trade unions. He should be doing this in Atlantic Canada and in other places where the trade union movement is not strong or is non-existent. Urging the formation of trade unions would do far more good for the ordinary workers than a thousand speeches to existing trade unions urging compliance with the guidelines.
If the government had been really concerned about the work force, they would have made specific proposals to raise minimum wages at the federal and the provincial levels. They would have ensured that the suggested mini-mums were at least passed on to those workers at the bottom of the scale. There is no such requirement. The government should do something about promoting the organization of unorganized workers. There is nothing in this program that will positively affect unorganized workers in Canada.
What about pensioners, another group that presumably is included in the minister's description of lower income people? I point out that a single pensioner in Canada receiving the regular pension plus the supplement receives only $219.96 a month, or just over $2,400 a year. That is all we give a pensioner in Canada in October, 1975. The poverty level for a single individual in Canada is $3,372, about $1,000 more than we give to a single pensioner. Is there anything in this program that is of direct benefit to a pensioner? Is there any suggestion that the rest of us, including individuals and corporations, will have a substantial tax increase in order to make it easier for the pensioner? There is nothing in the program that will alter the circumstances of a pensioner.
It is ironic, with sad overtones, that the maximum pension a person in Canada can get, if he does not have a private pension, is about what the salary increase will be for an MP and, in fact, the increase permitted to all people in all upper income groups-$2,400. Many of us will get an increase this year which is permitted within the guidelines of this program that is equivalent to the total paid to Canada's pensioners. Something is profoundly wrong when we have that kind of maldistribution of income.
Also, something is obviously wrong when we find the minister justifying his program and saying that the people with the lowest incomes are those who will be the prime beneficiaries. We reject that contention. We rejected it last Tuesday as being unfair, and the minister has said nothing since then which alters that judgment.
Let me deal with one argument I suspect he might make; he did refer to it earlier today. He said that if the government is effective in bringing down the cost of living through his program, then those at the bottom end of the scale would benefit. Of course they would benefit if we reduced the cost of living, but the point is they would not benefit any more than anyone else; in fact, since most of those with higher incomes spend more in dollar terms

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than they do, the people with higher incomes would benefit more.
So I think it is a specious argument to assert that the prime beneficiaries of this program would be the poor. If there is to be any benefit at all-and I think the benefit will be negligible-we will all get it. The government has done nothing on the positive side to benefit the poorer sections of the community, as any kind of incomes policy would have to do in order to get the support of the NDP. I refer to the minister's speech on Friday when, addressing himself to this question of fairness, he stated, "It is one thing to acknowledge this goal; it is another thing to observe it in practice." I agree entirely. The point I am making is that the Liberals have historically acknowledged such a goal; where they have been short is in the practice, and we find this well illustrated in the program they are urging us to accept.
Not only on the ground of equity should there be some redistributing element in this program, though that, of course, is important in itself. I say to the minister that in terms of making the program workable in the community, its provisions should be fair and equitable, because the people will not agree to accept some kind of sacrifice unless they are convinced that a sense of national fairness is built into the whole program.
What about the price control aspect? As was evident from the criticisms which I and others expressed last week, we do not believe the approach taken by the government in dealing with prices is effective. I do not intend to repeat all the arguments I made last week. We do believe that no government which set up a scheme to control prices indirectly through the control of profits could avoid a number of loopholes of which clever accountants or corporation lawyers could take advantage. We do not contend that because of such a possibility no attempt should be made to use this kind of mechanism. Indeed, as the minister pointed out, the NDP has commended this approach as one we would use. Nevertheless, I repeat it is extremely difficult to ensure its effectiveness since we are dealing here with an indirect control over prices. Corporations can hide their profits in all kinds of ways, hiring the best accountants and lawyers money can buy to enable them to make use of legitimate loopholes.
Aside from these considerations, there is in the white paper itself-and the effect will be apparent in the operations of the Anti-Inflation Board-a loophole to end all loopholes. It is expressed at page 19 of the white paper and I will read it because it undermines everything else which has been said about controlling prices through profit control. The last paragraph on page 19 provides for exceptions in the program. Let me read it:
A firm will be regarded as having acted in accordance with the program if its profit per unit of output or percentage net profit margin exceeded the guidelines as a result of unusual productivity gains resulting from the efforts of the firm, or of favourable cost developments which could not reasonably have been anticipated.
In other words, if there are gains through unusual productivity, a firm does not have to obey the profit guidelines. The same applies if there have been favourable cost developments which could not reasonably have been anticipated. The government has been telling us that it has established profit guidelines applicable to most of the corporations which would indirectly benefit the consumer

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since the corporations will be able to work only within a limited profit mark-up range. What they are saying here is that any firm which increases its productivity, or discovers some favourable cost development which could not have been reasonably anticipated, will be exempt from the guidelines.
I will say nothing now about the range of questions which could come before the courts, the disputes which would take months or years to resolve. I ask the minister simply: Will General Motors, will Weston's, will any large corporation in Canada find itself unable to take advantage of these loopholes? Surely, any corporate executive will argue, when any kind of cost benefit has been received, that it had not been anticipated. Who will prove the contrary? Will psychoanalysts be travelling about the country in an attempt to read the minds of directors of these various companies to see if cost benefits had been anticipated? As though the other loopholes were not big enough, they have added this catch-all which I suggest will let every corporation in Canada off the hook.
For these reasons, I repeat that there is no prospect in this legislation of effective price control, and any program of control which limits salaries and wages in the absence of price control is a totally deficient program and one which is unworthy of support by the House of Commons.
I wish to reply briefly to the criticism made of myself and the New Democratic Party in the House on Friday. The minister said there was no one who could speak with less credibility than the NDP in criticizing the government's approach to dealing with inflation. The reason, he said, was that the NDP had itself proposed the establishment of a prices review board. The hon. gentleman quoted some of my speeches as well as speeches made by the former leader of this party, Mr. David Lewis, and he stated, accurately, that in the 1974 election we had advocated the setting up of a prices review board as a major instrument for dealing with inflation. So he says, in a classical non sequitur-quite normal for a Liberal cabinet minister-that because we came up with the original idea, it is rather absurd, or perhaps hypocritical, of us now to criticize what the dear old Liberals are doing with it.
I should like to cite a few more examples of NDP ideas that have been taken over and bastardized by the Liberals-and this gem that they have come up with is a perfect historical example of what they normally do. You may recall, Madam Speaker, that it was the New Democratic Party who originally proposed the Canada Development Corporation. We proposed that it be publicly-owned and controlled, one that would operate independently of the marketplace. I would remind the hon. member that in our founding convention back in 1961, before even dear old Walter Gordon heard of this idea, this corporation was advocated by the New Democratic Party. Then the Liberals took it up and it was made an instrument for selling off at least the successful Crown corporations to the private sector. We do not support that. As originally proposed by us, the idea was a good one. As implemented by the Liberals, it was not.
Then during the minority government days, when the Liberals were under pressure, they set up a national
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petroleum corporation advocated by us. The NDP saw that as the first step in a series that would lead to a total public ownership and control of Canada's petroleum resources. How do the Liberals see this national petroleum corporation? They have already cut back on last year's budget. They took the guts out of the corporation by significantly reducing its budget, and it will play a very minor role in the petroleum sector. It will amount to nothing.
The point I am making, Madam Speaker, is that just because the New Democratic Party comes up with an idea and a name, it does not mean that the Liberals, when they take over the name, also take over the idea. In fact, they are pastmasters of doing the very opposite: they retain the name and the propaganda, but take the guts out of the idea. I suggest that this is what they have done with the Anti-Inflation Board. We proposed such an idea and said that one aspect of the powers of the board could be to order rollbacks in certain sectors of the economy. When the minister attacked us for neglecting our own policy, what he failed to mention in his speech was that we also said that for such a board to be operative, both in terms of holding down prices and minimizing the extent of the bureaucracy required, there should be a number of price freezes, that would come in automatically when the board was set up, in a number of key sectors of the economy. These were spelled out to the minister in speeches by David Lewis and by myself in the past. I do not know why the minister neglected to mention that. He may have neglected to mention it precisely because this government has not ordered any price freeze in any sector. Dealing with price increases is left entirely to the so-called profit control mechanism.
Once again the Liberals have taken a New Democratic Party idea that made some sense in regard to controlling price increases, an idea that said that in key sectors of the economy a freeze should be applied, with the corporations having to justify increases. But this idea has been turned upside down. In true historical fashion, the Liberals have turned the idea on its head. They have selected a number of sectors and let the corporations increase prices, making the people, via a government agency, justify any order for a rollback. We put the onus on the corporations. They put it on the people. It is this kind of approach that will require many more bureaucrats than would have been the case with our proposal. The way we see the board function is to put the onus on the corporations, as is the case now, for example, with Bell Canada, to justify any price increase. If they cannot be justified, then the increases would not be permitted.
Having talked about the prices proposal and why we think this board will be ineffective and the wage proposal unfair, I now want to say that one of the preconditions that the minister and the Prime Minister have talked about in the past in terms of such a program being effective-quite apart from its technical details-is that a board cross-section of the community would have to find it acceptable.
In his speech on Friday the minister said he welcomed the "generally strong support" that the program had received in Canada. Well, I do not know where he got that, whether he was talking to the members of his own family, or maybe talking to the converts in the Liberal party caucus who are suddenly committed to the idea. I listened
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to "Cross Canada Check-up" and I have been reading the press and taking part in open-line radio programs, but I do not find widespread acceptance of this program. I do not find it for the reasons that have already been alluded to: it is full of inequities; it is full of conditions that will make it not only unfair but unworkable. Therefore, I say to the minister that one of the preconditions that he has set for a workable program, namely, that it will have widespread public acceptance, simply does not exist. If anything, I judge right now that there are more people in Canada opposed to the program than in support of it.
This means that in the days ahead the minister is going to have a lot of trouble. There is no feeling at all in Canada, in our view, that this program will gain acceptance, and the reason is that it is a program that does not deserve to gain acceptance.


The Acting Speaker (Mrs. Morin):: Before recognizing the hon. member for Drummond (Mr. Pinard), I would like to list the questions to be debated tonight.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mrs. Morin):: Order. 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 Winnipeg South Centre (Mr. McKenzie)-National Revenue-Proposal to obtain building from Air Canada for computer centre in Winnipeg-Request for report; the hon. member for Victoria (Mr. McKinnon)-National Defence-Effect of antiinflation program on choice of long range patrol aircraft; the hon. member for Carleton-Charlotte (Mr. McCain)- Penitentiaries-Proposed institution at Morna, New Brunswick-Government position in view of objections.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Macdonald (Rosedale) that Bill C-73, to provide for the restraint of profit margins, prices, dividends and compensation in Canada, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
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[Stage Direction]
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Mr. Yvon Pinard (Drummond):: Madam Speaker, it is quite praiseworthy for the Canadian government to tackle immediately and vigorously the serious problem of inflation. It is essential that all Canadians not only realize the grave danger threatening our economy but that they voluntarily and consciously join the government in its efforts to control the inflation cycle.
During the past few years and especially in recent months we have witnessed frantic competition to obtain the highest profits, prices and salaries without any noticeable improvement in living conditions and the general quality of life in Canada.
One result of those unchecked increases was to make the cost of living rise considerably and another, to allow some fortunate people get profit margins or raises in salary that were appropriate and often more than enough to face the same cost of living, most of the time at the expense of small and medium-size businesses, small businessmen and low-wage earners, less able to defend themselves against rampant inflation.
Moreover there is not doubt that higher production costs and unrestrained price hikes are destroying the country's capacity for effectively competing on the international market. I say all that to point out that inflation is a present and growing evil in our society and that its ill-effects have repercussions on each individual's life. If, therefore, it is true that the fight against inflation has become the "business" and requires the co-operation of each Canadian, I think the present Bill C-73 has all necessary elements to recruit... successfully the majority of Canadians, without necessarily resorting to a true freeze of all wages and prices for a short period between 60 and 90 days, as previously suggested by the Progressive Conservative Party, the massive issuing of dollars by the Bank of Canada for a so-called compensated discount-which by the way means absolutely nothing and is apparently understood only by the misunderstood-as suggested by the Social Credit Party of Canada, or the killing of the private sector and the remuneration by the state without regard for competence and initiative, as suggested by the New Democratic Party.
This is a policy which is more adaptable and respectful of rights and reality: a selective control of benefit margins, prices, dividends and wages in Canada, which permits on the one hand the industry to spur production and, on the other hand, workers to keep their jobs, earn sufficiently more to meet the cost of living increase and, as consumers, to see a gradual softening of the substantial price hikes we have known.
Many Canadians are prepared to give up more substantial salary increases provided their purchasing power becomes larger and larger; indeed what is the use of getting a 25 per cent salary boost when at the same time you have to meet a 40 or 50 per cent consumer price rise and even more? If we can prove with the good administration of this anti-inflation legislation along those next three years that salary increases limited to 8, 10 or 12 per cent, as the case may be, do spell better purchasing power-taking into account simultaneous controls over profits and prices-and therefore improved quality of life
[The Acting Speaker (Mrs. Morin).]
for Canadians as a whole, the Trudeau government will be said to have taken the lead at the right moment and in an efficient way to straighten the economy of this country, for is it necessary to add that this government, as it should, is showing itself ready to curb substantially its own expenses.
However, this vast attack on inflation should not be made at the expense of small earners who were not lucky enough to get a new labour contract or a reasonable salary raise before the critical date of October 14, 1975. It may be difficult to put into the legislation or its regulations special provisions and variable standards to provide for regional disparities. It is nonetheless essential not to condemn those with really low salaries to near poverty for three years.
It would be unfair for those underprivileged to retain for another three years that unenviable status, when this government, through its various departments and specially that of Regional Economic Expansion, has made so many efforts, and still does, to fight against regional disparities. To my mind, the low-wage earner, the small and average businesses in the areas of slow economic growth, should be granted the same protection as farmers to whom the provisions of the anti-inflation act do not apply.
Though it be true that consumer price and rent controls protect the less fortunate, people who live on a fixed income such as pensioners, we must continue to improve the lot of the poor; the fight against inflation must be waged above all "on the backs" of those who encouraged it most, that is, big business with its excessive profits, and those who managed to inflate their incomes beyond reason.
The bill and its regulations can and do give in fact considerable latitude and discretion to the Anti-Inflation Board, chaired by my distinguished predecessor as hon. member for the constituency of Drummond in this House, the Hon. Jean-Luc Pepin, who by the way resigned from all the positions he had up to now to be able to devote himself to the Anti-Inflation Board without conflict of interest. In the white paper "Attack on Inflation" which was tabled in the House of Commons last Tuesday, it is said on page 22, and I quote:
Future increases provided for in contracts and agreements in force as of October 14, 1975 including cost-of-living adjustments, will be exempt from the guidelines. Where agreement has been reached by October 14, 1975 on compensation increases to be incorporated in new contracts, such increases will also be exempt from the guidelines. Special consideration will be given to those cases where contracts have expired and negotiations are underway, where the expired contract was signed prior to the beginning of 1974.
In the same white paper, on page 26, we can read, and I quote:
There will, therefore, be exceptions to the above guidelines. If an employer can demonstrate that he cannot attract or hold workers at existing wages and that an increase above the guidelines is necessary, the employer will not be regarded as having breached the guidelines.
There may also be other grounds for exceptions, such as increases necessary to maintain long-established historical relationships between wages in closely related groups and other special cases of equity. Employers may also grant increases in compensation above the guidelines if such increases result from taking measures to improve the health or safety of the employees while at work, to eliminate restrictive work practices, to offset experience deficiencies in pension funds, or to eliminate sex discrimination in pay practices.
October 20, 1975

Thus I wish all the regulations and all the powers of the Anti-Inflation Board will indeed allow those in regions of low economic growth to catch up where wages are, by far, under the national average; at the same time, of course, the Department of Regional Economic Expansion must not be the one affected by cuts in government expenditures, in order to give employers in disadvantaged regions the means to close the gap.
I have no reason for not voicing full confidence in the Minister of Finance (Mr. Macdonald) who, in his speech last Friday in this House, clearly indicated that he really intended to protect those I just defended.
The important point is to convince the obstinate circles that the war against inflation will not be waged on the backs of the low-income earners and to be prepared to amend the wording of the act or of its regulations, if need be, in order that there remain no doubt about it.
If this confidence can be won, everything will be all right and the fight against inflation will prove effective as people will not hesitate to unite and cooperate, in spite of the sacrifices this means within the framework of an act which is fair byt has teeth. Surely there will always be protesters, be they reactionaries, party followers or fru-stated people but their negative, selfish and antisocial response will not deter sensible Canadians, namely the majority of the people who expect their government to take a decisive and fair action in the present circumstances, thereby providing genuine and timely leadership.


Mr. Claude Wagner (Saint-Hyacinthe):: Madam Speaker, I am pleased to follow at this point the hon. member for Drummond (Mr. Pinard) who just sounded the alarm with barely obscured words and just indicated to the government the dangers facing the Canadian society with that program put forward by the Liberal administration. I am quite pleased that the hon. member for Drummond pointed out its gaps and expressed wishes. He even suggested the possibility of amendments.
Madam Speaker, we are in full economic crisis. We have been in it for already too long. And I assure you that I do not intend to treat you with a dissertation.
I imagine that those who are used to looking at the debates of this House, specially those gentlemen of the press, have seen all sorts of them. We witnessed sometimes dramatic sometimes absolutely ridiculous performances. I imagine that today we might have surpassed everything seen before. Observers are looking at a government team which from the first to the back benches must feel extremely embarrassed to bring in today a program they condemned so much not too long ago, to embrace today what they disowned not too long ago. And the color appearing on their faces, Madam Speaker, is simply not the color of their political party-


Mr. Guay (St. Boniface):: He dreams in pink.


Claude Wagner: It is an indication of what they feel down deep inside.
It is certain that we are determined to overcome the scourge of inflation that is eating at the very heart of society. We who have been in the official opposition for already a long time are fighting to bring this government to introduce steps that can lick inflation. We know what
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impact the cost of living can have on small businesses, the weak, underprivileged workers, contractors left to fend for themselves, people who are not unionized, particularly families.


Joseph-Phillippe Guay: He speaks like a bishop. I would ask the hon. member not to forget Cardinal Leger.


Claude Wagner: I hear the whip of the party opposite saying, do not forget Cardinal Leger. Not even Cardinal Leger! I am not forgetting particularly families which are affected by the high cost of living, and I point out, Madam Speaker, that at no time during his palaver of some 20 minutes on television the other night did the Prime Minister dare mention the word "family". Nevertheless it is the very cell of our economic community.
Therefore, we also want to fight. We hope that Canadians in all provinces will co-operate so that the proposed measures will somewhat control the excessive cost of living. On the other hand, we have no right to remain silent. We have to expose the ridiculous contrast between the Prime Minister's performance who for a year and a half has allowed the economy of the country to drift as a result of his spinelessness, his helplessness to tackle the real causes. And suddenly at the last minute, perhaps as the result of some divine inspiration, he comes forth with what he believes to be a proof of leadership.
Madam Speaker, it is rather difficult to excuse the government policy of inaction in recent years. It is rather difficult to tell them today: You have done very well at the last moment and you were quite outstanding before! I know that before such a performance, such a cynical, Machiavellian and hypocritical reversal of policy, Canadians in every region of the country will be disgusted, and if they are prepared to follow suit and comply with the proposed guidelines, it is not through affection for the government. It is not because they have any faith in this government. On the contrary, its credibility is deteriorating from day to day. One cannot help it if people are sometimes cynical when they are faced with public men and governments such as they have today who take such an attitude.
I say to you, Madam Speaker, that I still recall statements made in this House at the time of the May 1974 budget when the Prime Minister spoke on the famous Turner budget, and I quote:
This budget does not take the easy way. We want, not the easy way that the doctrinaire NDP or the controllers of wages on the Tory side want, but one which will keep the economy operating as the number one economy in the world.
The same Prime Minister on the same date, May 7, 1974, stated in this House and I quote:
It is true that our attack on inflation is not a simple one. It is a complex one. It is a complex solution to a complex problem. We certainly reject the simple, and perhaps simple-minded, approach that has been brought to bear by the opposition on this question. These Tory controls would control the wages of the workingman. Prices have already risen very high, and controls will not bring them down. If you freeze high prices, there are still high prices; but if you freeze wages, there are still low wages.
And during the electoral campaign that followed, Madam Speaker, this Prime Minister's colleagues repeated the series of statements that will now pass on the political history of our country as being the most irresponsible and
29 669 -4 6Vi

October 20, 1975
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the most hypocritical statements ever formulated in Canada.
On June 11, 1974, there was a big meeting in the riding of Saint-Hyacinthe. It was held in Marieville and 60 people were assembled in the yard, in the hall of the Marieville school to listen to the former Minister of Communications. Most of them were election organizers and returning officers in Marieville. They heard the Minister of Communications say:
Inflation is essentially an international problem and-
His words must still echo in their minds-
-and nothing can be done about the price of oranges and bananas.
Madam Speaker, there was a banana peel waiting for the minister's successor in the riding of Hochelaga. That was realized last Tuesday. I cannot resist pointing out the grand statement from the godfather of federal Liberals in Quebec, the Minister of National Health and Welfare (Mr. Lalonde), because he also has been slapped in the face in Hochelaga, and I am not referring to the scolding he received from his colleagues in the caucus. His colleagues were quite surprised to realize that the leader of the Liberal members from Quebec had spent all his time in New Brunswick and forgotten the Hochelaga riding. But that is a different story.
Well, he was saying: "The Progressive Conservative Party which wants to hurt the weak, the wage-earners, the farmers, the small businessmen is irresponsible when it suggests limiting government expenses. Yes, these are huge expenses, but they are necessary, and limiting them is out of the question."
Madam Speaker, if I am saying these thing to you, it is because men have short memories. Women's memories are not so short. And because men's memories are short, we must remind our hon. friends opposite about these previous statements. What is more, they must explain to us how they came to this complete about-face which is absolutely unique in political history.
Something is clear. In 1974, Liberal parti candidates sought a mandate from the Canadian people. They asked them for their votes to form a majority government, on the assurance that they were against any form of control.
Subsequently, here in this House, those same backers were quick to tell the Leader of the Opposition (Mr. Stanfield) and my colleagues that the people of Canada had rejected our party and had rejected controls.
Well, Madam Speaker, today I am telling the government that prior to undertaking a promotional campaign which will cost millions of dollars to convince Canadians that they should accept the measures that are now advocated and had been rejected earlier, that before doing that, the government should in all fairness and honesty confess to the people that they were wrong, that they made a mistake, that they lied to them, that they sought from them a mandate under false representations, and that today they feel the obligation of returning before them.
The government has no other alternative, and I challenge them to return before the people of this country whom they have misled. They should go and ask the
(Mr. Wagner.]
population for a true mandate; they should tell them the truth once and for all instead of behaving like cynical and machiavellian politicians. Let them have the courage to call an election and in less than a month they will either come back with an explicit mandate to impose such controls or not come back at all because voters will have put them in their place.


The Acting Speaker (Mrs. Morin):: Order, please. I regret to interrupt the hon. member, but he certainly knows that he must address himself to the Chair and not to government members.


Claude Wagner: Thank you, Madam Speaker, I even wonder how I could have forgotten you-


An hon. Member:: I apologize!


Claude Wagner: I apologize. So, since an election may be called tonight, I ought perhaps to shorten my speech, but, Madam Speaker, I hear them laugh. They will cling to power for another three years. They will continue to deceive Canadians, and stay in power under false representations. They will wallow in that ridiculous performance which the people have recognized as such; under the circumstances, as there is no hope for them, I shall continue to speak to them anyway. Madam Speaker, I should like-


The Acting Speaker (Mrs. Morin):: Order. The hon. member has alluded to power under false representations. I am sure the hon. member used words which exceed his thoughts, that he did not mean what he said.


Claude Wagner: No, Madam Speaker. I merely wished to point out that when a political party seeks a mandate from the people it should do so honestly. If it changes its mind along the way, it should also have enough integrity to go again to the people.

Madam Speaker, it becomes increasingly clear that as time progresses, this government has made ad hockery into a veritable philosophy of government. These economic measures which have now found their way into Bill C-73 indicate, as I was mentioning a few moments ago, that what was unacceptable last year, last month and last week, is the only answer today, at least if one is to take the present policy of this government seriously. I think that much of the effectiveness of this program depends upon the will of Canadians to make it work, and that in turn depends upon the credibility of the program and the credibility of the government that brought it forward.
I was referring a few moments ago to the fantastic about-turn that this government has made in its economic policies. I am looking now at the seat occupied by the hon. member for Ottawa-Carleton (Mr. Turner) and asking myself whether he declined to maintain his ministerial rank through a respect for principle or as a result of his inability to admit a fundamental error. Either way, the government is worse off for not having him as part of their economic pain.
The question is, are the people of Canada prepared to be part of this government's economic pain? In many respects, there are so many injustices and so many inequi-
October 20, 1975

ties in the program that this government has now put forward that many Canadians might not be blamed if they were to prefer sitting on the bench for a while before joining the team. These inequities are now becoming very clear. While it is possible for business enterprises to seek increases in prices through cost justification, it appears somehow impossible for the average citizen to do the same. The average citizen's increases are fixed, frozen and immovable. The hon. member for Drummond (Mr. Pinard) was alluding to these things a few moments ago.
Surely, one would not be too specious to ask why it would not be in some way more just if this program had some place in its operation for recognition in rising individual costs. Surely, if business enterprises can make their case within the context of this program, it will appear unjust if citizens cannot do the same. My leader has said that this program will involve rough justice if it is to survive. I say that there are so many weaknesses in this program that to suggest it will bring about any form of justice is simply to do so on the basis of faith rather than fact.
There is no question that my colleagues and I-who had the courage, by the way, to level with the country a year ago-will seek to support the principle and purposes of this legislation, but it is fair for us to warn the government this afternoon that if they are not prepared to seek meaningful amendment and modification so as to more properly assure just legislation and implementation of this program, this party will be prepared to clearly state its opposition when the opportunity arises.
The open handed nature of this bill which, by the way, runs beyond the normal traditional mandate of the government surely leads to some serious speculation. Has the government lost all faith in the ability of the market and the economy to respond to certain restraints and secure its own levels? Is there justification for those in the business community who fear that the price justification mechanisms in the bill are not even three years temporary, but are really a new permanent fixture of the government's economic management?
There is very little in these measures for the working men and women of Canada. I recall a campaign commercial in 1974, which ended with the following line:
The working men and women of Canada don't want their wages frozen. Vote Liberal!
In 1974 this party put forward a program that would have kept the cost of the working man down temporarily, restrained income increases, but a program that would have only asked the working man to carry the burden for 90 days. We asked the working men and women of Canada to accept the responsibility that we were prepared to enforce for all sectors of the economy, including the government. But we told the working men and women of this country that within 90 days they could seek increases within moderation, and that they could continue building security.
To limit the working men and women of Canada at the bottom of the wage earning scale to a $600 increase in income is absolutely heartless. It is not a situation that
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men and women of good conscience can be party to in this House for very long.
The scope of this bill, the length of its provisions, and the cynicism and misrepresentation by the government can no longer be viewed with equanimity. The future of this bill and its effectiveness are not threatened by its own provisions but by the insincerity of the government that has brought it forward. That insincerity re-commenced on July 9, 1974, and cannot be expected to evaporate from the mind of the average citizen. Indeed, I think it was that very insincerity that was very much on the minds of the working men and women of the riding of Hochelaga in my own province of Quebec.
A year ago a political party in this country said, "The working men and women of Canada don't want their wages frozen". Madam Speaker, with this government in power and with this party in power, the same party in power, the working men and women of Canada face the possibility of having their futures frozen. That, Madam Speaker, my colleagues and I will never accept.


Mr. Jean-Robert Gauthier (Parliamentary Secretary to Minister of State for Urban Affairs):: Madam Speaker, it is a pleasure for me to take part in the debate on Bill C-73, at the second reading stage. Before starting to talk about the bill, I believe there are a few observations made by the hon. member for Saint-Hyacinthe (Mr. Wagner) which perhaps deserve being answered. I think that the hon. member for Saint-Hyacinthe preaches in French a theory which, in my opinion, is entirely false. He said the government had initiated a price freeze policy, which is entirely false. The government has not established any price freeze policy.


An hon. Member:: He does not know the difference!


Jean-Robert Gauthier: During the last electoral campaign his party proposed a price freeze for 90 days, with nothing after that period of time. It is the "nothing after", as the hon. member knows quite well, that has contributed most to the defeat of this party. Canadians were rightly skeptical about the policy hap hazardly set forth by his party. Above all, they were skeptical. They were afraid of the 90-day freeze with nothing afterwards.
This bill, Madam Speaker, does not provide a freeze policy, but restrictive measures which will be extended on a three-year period. Canadians will know-they already know today-what this program is all about. The official opposition and the one on my right, the New Democrats, advocated a selective freeze, they being socialists, with a possibility of justification, of increase, under a procedure badly explained.
And here again we hear hon. members on the other side saying on the one hand "Freeze" and on the other "Not entirely". We cannot even tell what the opposition wants from the government and the Canadian people understand even less what the hon. members opposite are trying to say. Because since ... If the hon. member for Grenville-Carleton (Mr. Baker) wishes to speak, let him walk in, otherwise he should keep quiet.
I have trouble understanding the New Democrats who claim: "We are going to freeze but selectively" and the

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Progressive-Conservatives who declare: "We are going to freeze everything" But for how long? For 90 days? Our aim is not to freeze anything but to cut down some profits, to curb the expectations which for over a year have made the situation in this country more and more difficult.
To come back to the hon. member from Saint-Hyacinthe (Mr. Wagner), he is credited with saying; "What's new?". He knows fully well what is new. What is new is the kind of inflation we have today which is very much unlike last year's. Today's inflation, as the hon. member for Saint-Hyacinthe knows full well, today's inflation is home grown.


Claude Wagner: You don't say.


Mr. Muir:: It is 100 per cent worse.


Jean-Robert Gauthier: It is not 100 per cent worse and you know it. Last year's inflation was for the most part imported, because oil prices increased 400 per cent, because of world wide and global problems, bad crops in some countries, as hon. members know very well. Whether you admit it or not, Canadians know it. They found that out in their constituencies-


An hon. Member:: In Hochelaga!


Jean-Robert Gauthier: -they found that out everywhere. And, as you just said, they may have found that out in Hochelaga too.


The Deputy Speaker (Mrs. Morin):: Order, please. I must remind the hon. member that he too must address the Chair and not members directly.


Jean-Robert Gauthier: I apologize, madam Speaker. I followed the example set by the hon. member for Saint-Hyacinthe (Mr. Wagner).


An hon. Member:: A bad example indeed.


Jean-Robert Gauthier: I agree, that was a bad example to follow. In any case, Madam Speaker, I feel that of all the problems that now besiege Canadians, inflation is no doubt the most intolerable and perhaps the most insidious. It is intolerable because it affects us all, because it compounds social and economic problems, and especially because it undermines the purchasing power of our Canadian dollar. It can easily be seen that if the value of our dollar declines constantly, so does our purchasing power, and the small wage earners as people in higher income brackets will be facing an unacceptable and indeed very disquieting situation if it is not controlled, as the minister told us the other day. That is why this government came forward with Bill C-73, which proposes measures to deal with runaway inflation.

All Canadians in all walks of life must ask questions about this policy and how it will affect their lives and work. The benefits of restraint are long term, and the economic effects of non-restraint complicated. Therefore
(Mr. Gauthier (Ottawa-Vanier).]
all members of parliament, government supporters and opposition members, must tell the people in their ridings that they must join together in fighting the present most disquieting inflationary trend.
This afternoon I heard an NDP member say that he told people in his riding to defy the government and not support the program. I find his position difficult to understand. Surely it is not acceptable for a member of parliament to encourage open defiance of the government. I will say no more, except that he ought to have twisted his tongue before saying what he did.
Inflation is created by many converging forces, some at home and some originating outside this country. We are manipulated by forces which are sometimes beyond our control. No government can manipulate people by decree. Personally, I do not think any government can succeed in winning support for an anti-inflation program, or any other program, unless it manages to educate people about the forces which confront us and what the solutions are to our problems. We need comprehension. Sometimes these proposed solutions are hard to understand.
Economics is not an easy subject to understand and I do not pretend to be well versed in the field. Perhaps my weakest subject is economics. For that reason I thank the hon. member for Thunder Bay (Mr. Penner) for what he pointed out to me. This past summer he read much the same material as I read. The hon. member referred to the question of housing. That is an important issue. Also, like the hon. member, I had occasion during the summer to read the C.D. Howe Research Institute publication on housing. It was interesting and enlightening.
As parliamentary secretary to the Minister of State for Urban Affairs, I hope to take an active role in reorienting or restructuring programs, so that we may deal more aggressively with our existing problems. If any mistake has been made, it has been made in the area of demand. There is no demand problem in Canada, at least not in my area. There is a supply problem, to which the government will address itself. The government deals with the problem of housing in its pamphlet "Attack on Inflation." The problem deserves our attention. I hope, confidently, that the government will come forward soon with measures to encourage supply.
I hope that land for construction can be made available to our people and that contractors and entrepreneurs will support the government's programs so that we can surmount the crisis which has been developing in the housing field. Bearing that in mind, I am most pleased to be able to participate with the minister in this work.

Madam Speaker, I do not want to take up too much time. I believe that the matter of a freeze-


Some hon. Members:: Oh, oh!


Jean-Robert Gauthier: -not of a freeze but of the anti-inflation program, the word inflation comes back to me now-It was a slip of the tongue-I was thinking about you.
The anti-inflation program of the government is a program which must be sold, which must be understood and which may require a lot of energy on the part of the hon.
October 20,1975

members and perhaps even a lot of hot air. Anyway, we shall see. National problems are of such magnitude that I believe that we can count on the good will of everyone to try to get out of this hole, if I may use this expression, to get out of this very critical situation. If both sides would show a bit of good will-I know that the hon. member for St-Hyacinthe (Mr. Wagner) will show a lot of good will and that his party particularly might help us-to sell the program, to make the people realize that it is not a freeze program but a voluntary control program directed mainly and particularly at those the government has been trying for a year to convince to restrain their demands. You will recall that the minister of Finance often said: Yes, I am in consultation with business people, large companies, corporations, trade unions, bigwigs. However, since they did not react positively during the last year, this may be partly why the government had to introduce legislation to finaly apply income and prices policies which might save us from the inevitable disaster which is a regressive, inflationary and unproductive economy.
The same "big guns", the same big corporations which said no are now compelled by law to follow certain guidelines. This is not everybody, I admit it. I think we will win the fight if we have the guts to tell them we are serious, that we want to implement positive measures, and then we will soon have far better conditions to live in.


Mr.   C.-A. Gauthier@Roberval: Madam Speaker, on October 16, 1975, the Minister of Finance (Mr. Macdonald) tabled in this House Bill C-73 to provide for the restraint of profit margins, prices, dividends and compensation in Canada. That was indeed the purpose of the bill.
Offhand, Madam Speaker, we conclude that it is simply the price and wage freeze contained in the 1974 Tory election platform but the minister hastens to say that it is not the price and wage freeze but that the bill has aimed at restraining profit margins, prices and salaries. Either I do not understand English, or the minister is dancing on the tight rope. He says, it is not a freeze but something that looks like a freeze, not a concrete step but a phychological manoeuver. I do not think it is a freeze according to his explanations but a gel. It is indeed representatives of this government.
What is in the end the attack on inflation of the Prime Minister (Mr. Trudeau) and the Minister of Finance? All are asking the same questions in this House while the minister seems to rely on the board headed by two illus-trous political figures with fat salaries to give the population the explanations they dare give now.
And to prove that we are not the only ones, Madam Speaker, trying to discover what is hidden, under this troubling headline in today's Le Devoir of Montreal we read:


ATTACK ON INFLATION-EVEN EXPERTS ARE LOST
[Stage Direction]
Imagine! And we were just told that the bill is clear. I quote:
Anti-Inflation Act

[Stage Direction]
The least one can say about the anti-inflation program proposed a week ago by Prime Minister Trudeau is that it brought out the seriousness of the economic situation in Canada and polarized the attention of people on the problem.
The program is not very well understood even by those experts who elaborated it.
Imagine! It is not understood even by those experts who put the program together.
-On the general terms there is agreement, and that is to say that wage earners cannot expect an increase of over 10 per cent during the 12 next months and companies cannot raise their prices beyond the increase in their basic costs.
It is broader; what is the basic cost? The question must be asked.
But where specific points are concerned, it is not that clear, since even the ministers do not agree as to the impact of the measures they ask Parliament to pass.
The Postmaster General, Mr. Bryce Mackasey, said that the postal workers who are demanding a 71 per cent wage increase, will not be subjected to the controls. But Mr. Donald Macdonald, the Minister of Finance, said that the decision would be left to the Anti-Inflation Board.
Mr. Richard O'Hagan, who is in charge of the promotional campaign in connection with the anti-inflation measures, says that it will not be possible to give anything but broad answers to people asking for explanations until all the details of the program are set out in black and white.
As concerns the details of the program, apparently it will be up to the anti-inflation board to lay them down. The article reads on:
"We cannot foresee how the text of the legislation will be interpreted ..."
The lawyers have worked on the legislation, but in the final analysis, it is the Board that will decide upon the text of the legislation. And it reads further:
Inquiries are pouring into his office. "There is a tremendous interest in this program ..."
It is obvious that many people are looking for loopholes. The controls apply to the 9.6 million people who make up the working force. But all the other workers are presumed to be good citizens who are willing to comply with the guidelines.
There are many exceptions. Wage increases that come with promotions are not subject to control. An employer can also grant increases above the prescribed limits if he can prove that he cannot attract or keep personnel for less.
The guidelines apply to all kinds of income: social benefits, bonuses, shares, etc.
Anti-Inflation Board Chairman Jean-Luc Pepin said: "If people want that bill to be a failure, they will find 111 means of evading it".
Last night, the Minister of Finance (Mr. Macdonald), said on TV that the situation of Canada would become critical if unions refused to abide by the guidelines.
He mentioned that economic prospects for the winter are dull and it will take Canada longer than expected to recover.
In Toronto, Mr. Stephen Lewis, the leader of the NDP, accused the government of Ontario of ignoring its responsibilities-
And so on and so forth; I shall quote no further. Madam Speaker, I think opposition parties are not the only ones that do not understand this bill. I think most serious people who are not tied by the leg wonder where it will take us. How do you expect workers not to be apprehensive after such statements! Yesterday, before I was off on my way back, I met a very important group of workers now on strike because they did not manage to come to a reasonable agreement after months of bargaining. They
[Stage Direction]
October 20, 1975
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have been at it since spring, but to no avail. Sometimes you are almost tempted to believe companies had been forewarned about this bill, Madam Speaker.
Besides being denied their vested rights, such as marginal benefits which, according to the answer of the minister to a question of mine during the question period, will be included in the famous 8 per cent determined in the bill, workers will shortly be the first really affected by that bill. In fact, this is what the minister tells them, as reported on page 8307 of Hansard. Anyone who is not convinced about the intentions of the minister will find them displayed in his statement on page 8307 of Hansard. Although he does it with all possible caution to lessen the shock, he is bluntly saying to workers that in a short delay it must "control wages".
Madam Speaker, I want to point out that it is six o'clock.
The Acting Speaker (Mrs. Morin):: 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.
Charles-Arthur Gauthier: Mr. Speaker, before the recess I was stating that the minister had cautiously tried to lessen the shock when introducing Bill C-73. I merely read this evening the interview he gave at the CTV station when he said that it would be much more difficult in Canada for the workers to accept the bill as they did in Britain, because the British unions are much closer to the government that the Canadian unions. I think that the real reason, Mr. Speaker, has nothing to do with unions, but that it is rather a matter of priority.
In this bill, we note that the minister gives priority to a wage freeze, to unions and workers, while priorities should above all be given to incomes. I referred to the workers before the recess. Let us now turn to income. The minister seems to side with large companies and he simply says to the workers: The percentage will be established by law. To the companies, he says, and I quote:
-there will need to be adjustments as time goes on.
-On the income side. These are his own words as reported on page 8307 of Hansard, third paragraph. "It is not a freeze" . .. said the minister", but a control". However, this control is very hard on the workers. The minister should stop turning around in a circle and tell the truth to the people, namely that from October 14, there will be a freeze on wages but not on prices and incomes, as everyone wants. All the workers want is merely to be put on the same footing as the large producing or financial companies. If one is freezed, the other should be also. If one is tolerated, let the other one be also.
What, in my opinion, is more fantastic yet, Mr. Speaker, is the fact that all through his long speech, the minister did not refer to today's inadmissibly high rates of interest. The true inflation spiralling started when this government removed the chartered banks interest ceiling.

I said so the day after that decision and I said here that Canada would experience its worst years of inflation ever. The first serious step should have been to freeze the Bank of Canada's discount rate at 4 per cent. Thus, commercial banks would not have had the high cost of money as a false excuse if the prime rate had been frozen at 4 per cent, and I think that would have been more successful. The Bank of Canada belongs to us, the government is its master. Why is the government not interfering? What keeps it from freezing those interests first? We shall see after. We shall see the effect on commercial banks. In fact, we all remember that when the prime rates of the Bank of Canada fluctuated between 3 and 3.5 per cent,-over a period of 40 years, the commercial banks' rates barely exceeded 6 or 7 per cent. But when the Bank of Canada had to raise its prime rate as high as 8%%, how could commercial banks lend at 9 per cent? That was impossible. The problem exists. Besides, the government is well aware that the problem does exist, but it cannot talk about it because high finance is watching. I do not understand yet how a people-elected government, although financed by higher finance, dare take away all control over interests and ask workers not to demand wage increases. I wonder whether now our people will finally understand.
Following this voluntary and maybe imposed oversight, the minister states that he intends in the long run to come to grip with the incomes of the larger companies and ask them to kindly explain the reason for their increased benefits. The minister stated: "We shall have in the long run to consider also a readjustment". What a nice way to deal with larger companies, when we know that they have the best lawyers, the most capable accountants and the most clever concealment artists! Multinationals and other financial institutions have nothing to fear from the government. The same cannot be said of small businesses, particularly those which are not into favour with the party, or with an authorized representative.
Every day, Mr. Speaker, we can see what is going on with regard to income tax, for example, as well as to every other area. Home investigators are breaking at any time into small dealers, small businessmen's place, getting at people who are too weak to defend themselves against that horde of government's sharks. And after that, the minister even dare speak again about justice and equity.
What is of concern to us, in the Social Credit Party of Canada, is the fact that the small wage earners' rights are still encroached upon with regard to salary increase claims, since those who get only the minimum salary will be entitled to an authorized maximum increase of $600 only, that is $1,800 after three years, whereas those who get $24,000 or more will be entitled to an increase of $2,400, that is $7,200 after three years.
Except for the guidelines, the minister does not seem to have any specific answer as to the interpretation of this bill. He keeps referring to the famous board of which as yet we only know the chairman and the vice-chairman, and an administrator who is supposed to be responsible for overseeing the agency. It will probably be as usual a board among others in charge of overseeing the whole thing in order to create as many jobs as possible.
October 20, 1975

I wonder if the Prime Minister will find enough defeated political candidates among his friends to fill the gaps. Of course, this bill will be referred to the standing committee of the House for further study. We want it to be amended according to the priorities which we, of the Social Credit Party of Canada, have mentioned in the House. For if the bill is sent back to the House for third reading without amendment, be assured that I for one will vote against it. I shall not take part in such discrimination against the low income groups in our province and our country.


Mr. Hal Herbert (Vaudreuil):: Mr. Speaker, of all the ills afflicting our Canadian society, inflation is doubtless at the present time the most intolerable, the most insidious. The most intolerable because, more so than any other, it exacerbates social injustices because it strikes first and foremost the weakest and most helpless citizens. The most insidious, because we tend to consider inflation as a fatality against which we can do nothing but save our skin at the expense of the neighbour. Until very recently, that feeling of helplessness and fatality was all the more stronger as inflation came from foreign countries over which we had but little control.
That holds true of the OPEC countries which, in 1973, increased fourfold within a few months the price of their oil, totally disrupting the western economy. It also holds true of our trade partners who were more severely affected by the energy crisis than we were and who had no qualms about exporting their inflation to us with their cars, their television sets and their good products.
Carried away by the tide which engulfed the whole western economy, we could do nothing but cushion the impact of too sharp an increase in prices and do our best to protect our more helpless fellow-citizens against an inflation which came mainly from abroad.
It is in this light that the steps taken by the federal government in recent years should be seen. But the time when inflation came almost exclusively from abroad is over. For some months, through our own lack of discipline, our problems have considerably worsened. And now the fires of inflation are being blithely stoked up from within.
Nobody wants to acknowledge the fact that the oil crisis has really brought about a redistribution of wealth in the world and that we cannot live as if the OPEC countries had not wrenched some $112 billion from industrialized countries like ours in the year 1973-74 only.
While the Canadian economy has registered in 1974 a growth rate of 2.8 per cent and is likely to be lower in 1975, labour agreements gave wage increases of about 18 per cent. Many companies took the advantage not only to unload on their customers the rise in their production cost but also to unduly increase profit margins.
All that has strongly contributed to make us less competitive on the international market. Hence a decline in our economic activity and the chance to see our unemployment rate rise once again.
Before this situation, the federal government attempted, in a first move, to bring all partners of the Canadian economy to set for themselves, on a voluntary basis, certain restrictions necessary for the recovery of the economic health of the country.
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Our efforts, one has to admit, have been unsuccessful. That is why the Prime Minister (Mr. Trudeau) and the new Minister of Finance (Mr. Macdonald) decided to be much more directive today.
Having learned from last year's experience, the government has just put forward a certain number of rules and guidelines which are intended to check rising prices and salaries.
Starting Monday night, October 13, at midnight, these guidelines have the force of law for the federal government and all its civil servants, Crown corporations, private firms employing over 500 personnel and all companies in the building industry with over 20 staff. All other businesses and workers will have to follow suit voluntarily if we wish to draw the maximum benefit from this anti-inflation program.
We are living in a country where we take freedom for granted, one of the richest countries in the world with resources to solve every problem but one, namely, inflation; and inflation really is not one problem but a complex of problems summed up in one: how to control the energy of freedom before there is no freedom left to control.
A free society functions on a belief in equality and justice, on support of law and order, and on a willingness to put the public interest first. Last, but far from least, it functions on the faith that it will function. Today the system is being wracked by extremes of violence and apathy, spawning cynicism, illegality, disorder, self-interest, and doubt.
The causes are rooted deep in society's material goals, in the consequent decline of values and the decay of social disciplines now turning the long-term trend to equality into a drive for short-term rights. We sold our way of life with rhetoric about equality, and today the young, and the not so young, want everything going and want it now. Equality is replacing religion as the opiate of the people at a time when the trend to bigness, big business, big labour, and big government, is alienating the leaders and the led.
Society is in ferment. Everyone wants more rights. This translates in almost every case into demands on governments, demands by students to decide how they should be educated; demands by consumer groups to restrict the power of corporations; demands by environmentalists, minorities, and women's groups; demands for subsidies, loans, tax concessions, and welfare of all kinds; legitimate demands, but they all add up to more money at a time when the economy is giving us less. Everyone knows this; every group knows that to take more means less for others, yet everyone acts as though restraint should be practised by someone else.
Our freedom depends on restraint; its energy needs to be checked, as all machines have limits and when they are exceeded they self-destruct. Freedom and restraint are opposite sides of the same coin, but lately freedom seems like a coin with one badly worn side. Bit by bit our restraints are wearing away.
Inflation is a symptom of the lack of restraint, a symptom of the underlying illness. But it is more than a symp-

October 20, 1975
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tom, it is like a cancer where the cells flout the rules that govern the health of the organism. It begins as a symptom but it ends as a cause.
Inflation has always been with us; a mild infection accompanying growth. I am sure that few of us can remember a time when some prices have not been rising. Inflation embitters and corrupts. It embitters some by unfairly taking away the wealth they have earned. It corrupts some by giving them wealth they have not earned. The ethic of giving to society is destroyed by the action of taking, and we think less of society and ourselves.
The worst demoralization is among the middle-class, the silent salaried majority who make our institutions work. They see their savings melting away and their stocks and bonds losing value. They fear a collapse of currency that will shrink the worth of their property. They are worried about depression, unemployment, and their pensions. Inflation makes us all self-concerned.
Inflation spreads resentment. People see a steady transfer of wealth from the weak to the strong with no regard for merit, effort, or economic contribution. It makes them see the economic system as unfair, and it makes the political system seem inept. All leadership is discredited. We begin to think there is no answer. We lose faith in the system and then we lose faith in its currency. Money grows cheaper by the month, the week and, finally, by the day, as it did before the collapse of Egypt, the fall of Rome, and the rise of Hitler.
This is not going to be the scenario for Canada. It is the job of the government to see that justice is done, to provide law and order, and to free citizens of fear; we cannot do this unless we can stabilize prices and unless we restore public confidence in money. We live in the shadow of a world wide currency breakdown. We live with the spectre of depression.
Last fall we held recession off with tax cuts and deficits, but now we are paying for it with higher prices. Indeed, already production is falling while the cost of living is going up. Indeed, it is clear that falling production is due in large measure to rising prices and to the inability of many people to pay them.
There is no longer any question of where we should place our priority. Inflation is now public enemy No. 1. It threatens not only the economy but democracy and our freedom. It must be brought under control; it must be restrained.
No government wants to interfere with the cherished rights and privileges of its most powerful constituents; its only certain reward is unpopularity. We knew that some power blocs would say restraint will not work because it limits their power. We knew that some would say it will not work because it limits their personal gain. We knew that others are sincere in their doubt and that many, too many, still want to believe that things will work out by themselves.
We also knew that the nation was crying for leadership on a course that will pull us together, and that, although business and labour would not give us a consensus, the nation as a whole is now demanding it. We do not pretend that this course will be smooth. We know there are plenty

of potholes and we do not pretend to have the perfect solution.
The sacrifices we are called on to make are slight compared to the gains. All we are really being asked to do is live within our income and to give up some short-term loot for our long-term benefit. We are just being asked to consent to our own survival.
For the businessman this means reassessing his operating creed. Is he responsible solely to his shareholders or is he also responsible to his customers and to society? The question has been around for a while, and most businessmen have answered it, in principle at least, with a clear cut yes.
For the labour leader it means cooling the adversary system, with less need for fiery speeches condemning management and less need for extravagant posturing at the bargaining table. It means lessened use of the power that trades more pay for layoff notices, that strains the movement's unity, devalues the money gained, shrinks pension funds, and ends with the power to win nothing.
The fundamental fact is that we are all in the same boat. Our identity of interest is even stronger than our conflicts. No one has more to gain if we end inflation than the businessman, and no one has more to lose if we do not than the unionist. I am betting on them both. I am betting on us all. I still have faith in human adaptability. [Translation]
If only yesterday inflation was beyond our control because it came for a large part from abroad, today we are more able to overcome it. We only have to stop feeding it through our indiscipline. And the government will set the example by putting a ceiling for all practical purposes on the number of employees and compressing its own expenditures as much as possible.
If we refuse to yield to the inflation psychosis, if we accept to submit willingly to the rules set out by the government without playing the game of cynicals who suggest that the small always end up paying for the big, in short, if we all decide individually and collectively to stop living beyond our means, then we will have made an enormous step in the right direction. And Canada will be back on the road to economic health and social peace both based on a fairer participation of all in the national wealth of this country.


A. Daniel McKenzie: Mr. Speaker, I should like to state the position of the Progressive Conservative Party on Bill C-73 this evening. I also wish to point out that it was the Progressive Conservative Party, and especially its national leader who consistently showed leadership in drawing attention to the serious even fundamental damage to our country's national fabric by continuing double digit inflation, and in calling for strong and direct government action to deal with the problem.
Our position on that score has not changed. Right off the bat may I say that is a major difference between the Progressive Conservative Party and the Liberal government which now has had to swallow the cynical and misleading position it kept putting before the Canadian
October 20, 1975

people, not only during the 1974 election campaign but ever since, up to and including the budget of the former finance minister on June 23. I should like to make further comments on the cynical misleading information he gave the Canadian people.
I can recall during a Liberal broadcast on the radio station in Winnipeg when the Prime Minister (Mr. Trudeau) came on in a mysterious and dramatic voice, stating that the Conservatives "would freeze your wages." This did not fool the people of Manitoba because they know that inflation cannot be cured by the freezing of someone's wages. They knew it was a combination of wage and price controls. I will never forget the words of the radio announcer who, following the Liberal broadcast and the Prime Minister's voice, came on and said, "That is a bloody lie". Even the radio station people did not fall for the phony Liberal ads.
We remain convinced of the urgent necessity for strong and effective national action and leadership on this issue. Indeed, if anything the 15 months of ineffective action and non-leadership shown by the Liberal government since the 1974 election make the need for effective action all that more necessary, as they have made the problem just that much more difficult to deal with now.
It is for this reason, as expressed by the Leader of the Official Opposition (Mr. Stanfield) last Tuesday, we are prepared to support the intent of the government's program and, therefore, not to oppose the bill on second reading. At the same time, however, we wish to make it abundantly clear that Bill C-73 with its accompanying policies, as announced by the Prime Minister and his ministers, is not our program. We advocated an incomes policy during the 1974 campaign. There are important, if not fundamental differences between the program we advocated and that which the Liberals now have announced, both in terms of the broader context and the details of the legislation itself.
A very basic difference is that the Progressive Conservatives never presented their proposals for an incomes policy as any answer by itself to the inflationary problem. Fundamental to our approach-and the record makes this abundantly clear-was the need to accompany a shortterm controls program, designed essentially to break inflationary expectations, with other, equally important measures to deal with the more root causes of the problem.
In that context we placed and continue to place major emphasis on the need for more appropriate fiscal and monetary policies to be introduced by the federal government. Leadership by example-and that is the only kind of leadership people will understand and accept in the long run-is not simply holding federal civil servants within wage guidelines, or postponing new furniture purchases. If the call is for the nation to live within its means, so must the government abide by the same edict.
The record of the Liberal government in this respect is virtually the opposite of what is required. On the monetary front the Bank of Canada, with the government's approval, has consistently permitted increases in the money supply well in excess of any increase in real or even inflated economic growth. During the past 12 months that increase has amounted to more than 15 per cent. Indeed, if one wants to look for sources of fuel for this
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year's inflation, it is difficult to find a better starting place than the more than $3 billion which the bank pumped into circulation during the last quarter of 1974 alone, in a rather cynical exercise to ensure the success of the former finance minister's massive Canada Savings Bond program of that period.
We do not advocate a so-called tight money policy, and never have. But we have said time and time again that, if inflation is to be brought under any meaningful control, increases in the money supply must bear closer resemblance to rates of growth of the economy itself. Similarly, the Liberal government's own spending record has been a model of living beyond one's means and making unrealistic demands upon the economy. Under this government spending has increased by 192.8 per cent in seven years. This year alone, according to the June 23 budget, expenditures are forecast to rise on a year-to-year basis by 11.2 per cent.
According to spending patterns during the first four months of the current fiscal year, the former minister of finance's June forecast of a $3.1 billion budgetary deficit appears to be low by 50 per cent or more. In short, the government's appetite for spending has been boundless, an appetite fed both by ever-rising tax takes from Canadians and by continually heavy demands upon capital markets of the country.
Again our position on government fiscal responsibility has been both clear and consistent. We realize that, given the relatively high degree of inflexibility in government spending patterns resulting from statutory and other commitments, it is not feasible to talk of reducing government spending in absolute terms. But we have continually urged the need for government to show restraint in its own demands upon the economy and, more specifically, to limit increases in its spending to rates of real growth in the economy itself. One might compare that with the weasel-worded undertaking of the government white paper that "the trend of total spending by all governments in Canada should not rise more quickly than the trend of the gross national product", whatever that means, if anything.
There are a number of other basic differences between our approach, as set forth during the 1974 campaign, and the government's program, at least two of which stand out. First is the time period during which any controls program could hope to function without setting off serious new distortions within the economy. Because we realized that an incomes policy was designed essentially to break inflationary expectations and create a breathing space for other more fundamental anti-inflation policies to be brought to bear, our undertaking was for a program of no more than 18 to 24 months. The Liberal government, in Bill C-73, seeks approval for a program of more than three years' duration, until December 31, 1978, with further provision for extensions even beyond that. That simply is not acceptable to us in the Progressive Conservative Party.
As already noted, controls can have a distorting effect on the economy, and the longer the regimen is in effect, the sharper and deeper the distortions are likely to become. But even beyond that our party is not prepared to grant on an open ended basis to the federal government, particularly this federal government, with the kind of sweeping centralized powers represented by Bill C-73. The

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exercise of these kinds of powers over such a long period of time raises questions well beyond that of economic distortion, reaching to the issue of fundamental changes in the balance of the decision making power within our free market system.
A second significant difference between the two approaches lies in the way in which one could and should lead into such a program. As you will recall, the Conservative Party advocated as an initial step an across the board freeze period of up to 90 days in order to have a pause period during which our government could sit down with the major interest groups involved and work out the host of questions which will inevitably arise with regard to any incomes policy.
Without the freeze, government is left to try to sort out the ground rules, while groups and individuals scamper to assert their special interests within the program. In less than a week we already have seen ample evidence of the kind of confusion and exaggerated inequities that result from the government's lack of any orderly introductory period.
Here are some basic concerns about Bill C-73. Beyond these over-all differences of approach, and with even the limited amount of detailed information available to us from the government to this point, we can identify several important aspects of Bill C-73 which concern us and on which we probably will be seeking amendments as the legislation progresses through committee.
Mention already has been made of the time period during which such sweeping powers should be in effect. We cannot support those clauses of the bill, especially clause 46, in their present form. At the very least we shall be demanding that the government return to parliament after a much shorter time period, justify its need for any extension, and obtain formal parliamentary approval to carry on the program for a further period.
Beyond this question of an effective time period there is also the issue of parliamentary accountability during the period the program is in effect. While Bill C-73 requires that certain, but not all, of the actions taken by the established agencies such as the Anti-Inflation Review Board and the administrator be tabled in parliament, there is no provision for any kind of comprehensive reporting to parliament on the over-all record of the program and no built in opportunity for parliament, through one of its committees, to receive and scrutinize regular reports from the agencies established by the bill. Given the massive powers involved, we believe some process of accountability is essential.
The bill empowers, indeed requires, the Anti-Inflation Review Board to keep confidential virtually all of the information it collects in making a judgment on issues coming before it. The bill does not require the board to offer publicly any detailed reasons or explanations for its decisions.
While we recognize and respect the need to keep confidential any information of a personal nature or which could jeopardize a company's competitive position, we feel strongly, as we have said continually, that an incomes policy can only function if people see that justice is being done and understand clearly how and why decisions are

being made. The bill should seek to foster the fullest possible public understanding by ensuring that agencies administering this program provide Canadians with the maximum possible information on the basis for their decisions and actions.
Any process such as this, placing in the hands of administrative agencies massive discretionary power, obviously requires comprehensive appeals procedures in order to guard against the abuse of such powers. But in Bill C-73, clauses 30 through 38 propose such an elaborate and complicated procedure, such as carrying actions of the board and of the administrator through an appeals tribunal, the cabinet, and eventually the courts, that decisions may well be tied up for months in one appeal procedure after another. Justice delayed is indeed justice denied.
There are many other points in the bill, for example the penalty provisions and powers for police raids, that undoubtedly we will want to question in the days ahead. And, of course, there is the whole question of the guidelines themselves which are not in the bill but are to be regulated by the government.
We are making no promises beyond second reading. As already noted, we have agreed not to oppose the bill on second reading because we accept the broad intent of an incomes program and because, for now at least, we are taking the government at its word in terms of being willing seriously to consider amendments to this legislation. Beyond that, however, we make no promises or commitments of support for Bill C-73. Indeed, our view at this point is that, without important changes being made in some of the areas identified above, we cannot give our approval to this legislation on third reading.
We are also concerned about how the bill is to be handled following second reading. Given its tremendous importance to the people of Canada, it seems fundamental to us that at least the major interest groups be given an opportunity to express their views on the legislation itself before a Commons committee. The white paper at several points promises "extensive consultation" with the major groups involved, including the provinces, industry, and organized labour, and it strikes us that there being little indication at this point of any meaningful consultation with any one, a proper place for such consultation is before parliament itself so that members on all sides of the House can have the fullest possible understanding of the attitudes and concerns of Canadians before making any final judgment on Bill C-73.


Mr. Hugh A. Anderson (Comox-Alberni):: Mr. Speaker, it is an honour to join the debate on Bill C-73. More than that, it is an honour to put forward specific proposals in two areas to ensure that Bill C-73 will work to the benefit of all Canadians.
I believe that members of all parties agree that the results of increased inflation have caused, and will cause if unchecked, a rent in our national fabric that will be a long time in the mending. On the one hand we have inflation, and with the consensus program a failure we, as the government, looked at the alternative of mandatory price and wage guidelines. I would like to emphasize "guidelines" to make sure that in no one's mind is there confusion with the guidelines in a certain program of
October 20, 1975

freezes proposed in 1974 by the Conservative Party. Those people who equate guidelines with price and wage freezes are suffering from self-induced hallucinations because one has no relationship to the other, either by blood line or by name.
Although personally I believe in a free market operating on the supply and demand principle, I would like to agree with the Prime Minister (Mr. Trudeau) and the Minister of National Revenue (Mr. Cullen) that, faced with the prospect of either self-generating inflation or guidelines, guidelines are the lesser of two evils. There is no perfect system and it is recognized by all on our side that guidelines are a rough form of justice, but justice, rough or not, is preferable to economic anarchy. Imperfect though these guidelines are, so is this House and so are the members of whom this House is composed, but surely no one would suggest that the House should be abolished because of its imperfections, nor should Bill C-73 be abolished.
Initially in my opening remarks I stated that I would propose two concrete suggestions to assist in the chances of survival of Bill C-73 in the months to come in order that it may be implemented to benefit all Canadians. The first proposal deals with the obvious bureaucratic nightmare of policing retail prices in the market place.
As a member of parliament I sought a method of assisting the Anti-Inflation Board in my area. If I may I should like to read a release circulated to my riding of Comox-Alberni, dated October 20, 1975, which is as follows:
The guidelines set down in parliament regarding price control are very specific. Prices may not increase unless there is a corresponding increase to the producer or manufacturers' cost. Fishermen and farmers are exempt. In other words, unless the cost of production increases there can be no increase to the consumer. There is, however, one fly in the ointment and that is monitoring the literally millions of products available to the Canadian consumer. For this reason I am proposing the setting up of a constituency review board composed of volunteers who will be unpaid and who will monitor prices in the Comox-Alberni federal riding. Since I have already established two constituency offices the headquarters will be in these offices located at Port Alberni and Campbell River. I would ask all interested parties who would like to participate on a constituency review board to contact either office and leave your name, address and telephone number-
The purpose of the constituency review board will be to monitor retail prices in all sectors of the retail economy in order to ensure that price guidelines are being followed. I envisage that price lists will be scrutinized by the constituency review board and their findings passed on through my office to the appropriate minister and anti-inflation board. Also if it is deemed appropriate findings will be made available to the public through the media. In this way both the general public and the anti-inflation board will be kept up to date on the price changes in the Comox-Alberni federal riding.
The first proposal deals with the obvious. If I may, I should like to list the advantages of such a system.
First, there would be a reduction in the amount of government moneys needed to monitor retail prices in the Comox-Alberni riding.
Second, outlets will become aware of a price monitoring review and this will create a further restraint.
Third, price lists will be public knowledge, thus keeping the consumer informed of price changes.
Fourth, by being plugged into the constituency price review board I will be able to alert the anti-inflation board of abrupt increases.
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Fifth, through community participation the individual fight against inflation will become meaningful and not merely a slogan to be abandoned in the political trash can.
I would request that all members of the House consider this proposal and how it can be implemented in his or her own constituency so that they may contribute personally to the fight against inflation at no cost to the public. The public deserves leadership not only from the government but from each individual member of parliament. Let us provide that leadership in the war against inflation. If we do so, I believe the people of Canada will not begrudge us the recent increase in pay but will realize that their hard-earned money is being well spent. I trust that members on the other side who have commented on this will take a closer look at it, because this is the way they can play a meaningul role in the fight against inflation rather than merely discussing it in the House, which will not help the fight at all.
I would also propose to the House that in the area of housing all mortgage interest in excess of 6 per cent be classified as an income tax exemption for an amount not in excess of $1,800 a year, the mortgage maximum to be computed on mortgages up to but not exceeding $30,000. For those renting accommodation, whether it be an apartment or a house, I would recommend a maximum exemption of $900 if married, and $450 per year if single.
The benefits would be twofold. First, new housing starts would be encouraged, and the plan would make housing a reality not only for those with high incomes but for those who only dream of a house with no chance of turning their dream into reality. Secondly, it would free funds for those already carrying a mortgage. These funds could be put into an economy that is going through recession pangs, as are all countries in the world today.
Housing must have a new infusion of imaginative proposals. Tax exemptions do not spend public funds- exemptions cause governments to rely on less public funds because taxation revenue is decreased. With the annual revenue reduced by $1 billion the government would have to adjust its budget. This can be done by this government-this has been done by this government. I submit these two proposals to the House tonight, Mr. Speaker, and hope that they will find favour on all sides.


Mr. Joe Clark (Rocky Mountain):: Mr. Speaker, the remarks of the hon. member who just returned to his seat make me think that with the ascension of the hon. member for Rosedale (Mr. Macdonald) to the portfolio of finance, anyone thinks he can give a budget speech and introduce a budget policy here. I assume that is the significance of the address to the electors of Comox-Alberni that we have just heard.
In my view, Mr. Speaker, there are two immediate features about the legislation presented for debate today, both of which are alarming and familiar. The first feature is that this legislation, like so much that has come from the government, reflects a cynicism and an attempt to fool Canadians about the seriousness of the response of the government to major and disquieting economic problems. The second feature is that there is here, as there has been in so much of the legislation introduced by members of the government, a determination to gather excessive power to

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the bosom of the government without an opportunity for controls by parliament over the exercise of this power.
I want to deal now with the question of timing, Mr. Speaker. The Government of Canada which won its last election by caricaturing this proposal is now swallowing what it said, and is introducing a program that only 14 months ago it vigorously condemned from coast to coast.
The Minister defends the timing of this turnabout by saying that public support now exists for some kind of program of controls. What he means is that the Liberal party and their Liberal flacks have stopped their campaign, have stopped their deliberate attempt to create fears about the way governments might deal with the serious problems of inflation. They have stopped trying to alarm Canadians about actions that must be taken. Consequently, because they have stopped inciting fear, there is now in the minister's view some greater measure of public support for programs which in essence they condemned 14 months ago.
There are arguments about the kinds of controls that were proposed then and are proposed now, and of course there are differences in the programs. We on this side of the House are pleased to have these differences recognized. The proposal which was introduced by my leader, and supported by members of this party in the election campaign, was less lasting than this, which means by implication it was less dangerous than the matter we are considering tonight.
The fact remains, and it is testimony to the cynicism of the Liberal party, that in the election campaign of 14 months ago-the election campaign which gave the government its mandate-the Liberal party opposed with all the energy it could muster, the essence of the program announced the other night on television. It opposed it in a way which was not only simplistic but which was as near to dishonest as one can remember in any national election campaign. We see the spectre of this cynical government embracing what it condemned on the way to victory in an election. But ministers are still not open enough with the people of Canada to admit that last time they were engaging in election tactics, and that the problems of inflation are so serious that they require now, as they required then, some approach of this nature.
The other matter to which I referred earlier is the extraordinary nature of the powers which the government seeks to gather unto itself by these proposals. There is to be a capacity here to step in and seize records, a capacity which reminds me and other of my colleagues of some powers which were included in the petroleum administration bill which, coincidentally or otherwise, was guided through this parliament earlier by the minister who is now Minister of Finance. There is the explicit provision, explicitly referred to with pride by the minister in his remarks, to the effect that the guidelines for implementing this legislation are to be established by order in council, are to be set down by the cabinet without reference to parliament. In other words, as it now stands, the teeth, the nature of this legislation, will be established in Cabinet regardless, perhaps, of the impact on Canadians.

There is written into the bill the power for the cabinet to reverse the administrator, to say that his decision is wrong. That may be necessary, but it certainly creates the capacity for abuse. It tends to concentrate all power with regard to this measure in the hands of cabinet. Most alarming of all, there is in this bill the capacity to prolong the life of the system of controls beyond the time that is already longer than many Canadians are comfortable with now.
Clearly, when a bill of that kind is presented to the House, a bill which includes provisions for excessive power to be gathered into the centre, there is an obligation upon members of this House to examine the legislation in detail, to scrutinize each specific proposal and to take the time that is necessary in the standing committee not only to seek information, which we must do, but also to introduce amendments which will make the bill a less dangerous example of power concentrated at the centre, a power which might be exercised arbitrarily in a way which would seriously and permanently distort the economy of the country. That is particularly important with regard to this bill, because it was introduced by a government which has been in the habit, since its first election, of gathering control to the centre, of aggrandizing its own power, of weakening the power and capacity to create of other elements of Canadian society and the Canadian economy.
This government has a dangerous record of centralizing power. That is why we must be particularly concerned about what it is to do with this bill which allows it, as it stands, so much latitude. It must be emphasized that we are not dealing here with a temporary measure. This measure will last for three years at least, and may last longer than that.
Many of us, since the early boom in the publication of Maclean's magazine as a news magazine, have received in our offices free copies of Maclean's magazine. The most recent edition which arrived in most of our offices the other day contained an interview by the editor of Maclean's, Mr. Peter Newman, with the Prime Minister of Canada (Mr. Trudeau). That interview assumes some association with the legislation which has been introduced in this House. The interview, according to the preface, took place on September 30, which is 20 days ago. I want to quote what the Prime Minister said 20 days ago about the measure before us tonight, a measure which can have serious and permanent effects on the Canadian economy.
Here is how Maclean's reports what the Prime Minister said 20 days ago about controls. Replying to a question, the Prime Minister said:
But I think every experience I know of-most recently the United States and the British experiences-is to the effect that when you take controls off you begin more or less where you were before.
Maclean's asked, "The economy just catches up," and the Prime Minister replied:
Exactly. People say, "Okay, we've been held down, or we've been controlled for a year. Now let's hurry up and get those wage increases, those salary increases and those price increases that we've been prevented from getting by the intervention of the state."
That was the philosophy of the Prime Minister 20 days ago. Twenty days ago he said that when you impose a system of controls you are only building up problems. One would deduce from that statement, made before the emergency announcement on television on the eve of two by-
October 20, 1975

elections, that the Prime Minister opposed controls because he was worried about what happens when they come off.
Those who are worried about the timetable set out in the bill and who know that this government has introduced this legislation, must ask themselves when the controls are going to come off if the Prime Minister of Canada says that the program is not effective if the controls come off. In other words, you must consider what he has been saying in the light of events which have occurred since the publication of the interview. The logic of what he is saying is this: the controls program does not work if it ever comes off.
We do not know how long this period of controls will be. We are told that it will last between three and three and a half years. That, in the view of many on my side, is an alarmingly long time. We know it is all too simple for the majority party in this parliament simply, by its own vote, to extend that period, to extend the capacity of this overly powerful centralist government to continue the program of controls for a longer period. That matter will need to be changed at the committee stage.
Of course the Maclean's article raises other questions about the long-range planning of the Government of Canada. Perhaps on September 30 there was no intention at all to bring in this kind of program. Perhaps something occurred between September 30, when the Maclean's interview was given, and the night when it was felt necessary to influence voters in Hochelaga and Restigouche by going on national television and announcing an emergency program. Perhaps something happened to change the government's mind.
It is singularly curious that on September 30, 13 days before the Prime Minister's announcement and 20 days before today, the Prime Minister was expressing severe reservations about any program of controls. Yet, 13 days later, he introduced those controls. I shall return to this theme later, because I think there is a serious reason to believe that what we have here is a jerry-built program which was put together overnight without adequate consideration of the consequences, distortions, and disruptions it can cause in the Canadian economy.
My point is that a bill which provides this kind of latitude for a government is dangerous in the hands of any sponsor, but particularly dangerous in the hands of a government which has spent its successive mandates in adding powers unto itself and in limiting the power and creative capacity of other sectors of the Canadian economy. It would be useful, particularly in light of the Prime Minister's statements of September 30, to trace the genesis of these measures, of this legislation.
The Prime Minister, in some unusually eloquent language at a press conference announcing his new ministry, made reference to what he called the law and order kick. That was by way of introducing the nature of the measures that he and his government intended to bring before the session of parliament which re-commenced last week. He said, and I quote:
-the rate of growth of the Canadian economy is no longer as great as it used to be and therefore people are realizing that something is changing. And this uncertainty they have translates itself in socially neurotic behavior. ... This will mean government approach to the
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whole problem of peace and security, by looking at the criminal code, by looking at such things as gun control, capital punishment, the whole works.
My interpretation of what the Prime Minister was doing at that time is that he was caught between two events. On the one hand, he and his colleagues had planned to bring in no economic legislation to the parliament that began meeting again last week. They intended again a melange of domestic legislation aimed at social problems; gun control and that kind of thing.
Suddenly the former minister of finance resigned. There was an outcry responding to that resignation. It brought focus to the great Canadian anger and concern about economic conditions. The Prime Minister is at least alert enough to recognize an issue when it stares him in the face. He knew that inflation was the issue. His program was prepared to deal with other problems. His solution was, as he said at the press conference, and I confess to putting words in his mouth, to fight inflation with gun controls. That was the plan. It was undone by the resignation of the former minister of finance, which was apparently unexpected. By the emphasis of the response, the Prime Minister knew the public was angered about inflation.
I do not believe the reason this legislation was brought in was because there has been a profound change in the recognition by the Government of Canada of the seriousness of our economic matters. Instead, I think it was brought in because it had suddenly become an issue at a time when a divisive issue was dangerous to the government.
The most effective and prominent English Canadian minister of the government walked out for reasons he still has not been frank enough to tell us. He had nonetheless quit. He raised concern about the economic situation in Canada. The Prime Minister knew the Liberal party would have a convention later this fall which involves a mechanism for a leadership review. What he did was whomp up an economic program, not designed to meet the economic needs of the country, but to meet the immediate pressing political requirements of the Liberal party.
If I am correct and what we are dealing with tonight and in the days to come is a jerry-built program, a program thrown together at the last minute for reasons generally unrelated to the economic problems of the country, we are in a very serious situation.
This program was thrown together so quickly that the government did not even have time to find a third commissioner. If there had been any planning, surely it would have been able to find the third wheel of the troika.


An hon. Member:: They didn't find the second.


Charles Joseph Clark: My colleague suggests they did not find the second. There was some question as to whether they are sure they have found any. Clearly they were so rushed in their planning that they were not even able to find a third person prepared to sit on a board with Mrs. Plumptre and Mr. Pepin. Perhaps that is understandable. It is at least remarkable. It is an indication of the rush with which they proceeded on this front.
It is probably inappropriate to suggest that the results in Hochelaga have left the government with a gentleman to whom a certain debt is owed, a man who has had some

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experience on national commissions involved with controls. Perhaps they were anticipating that result when they left open the third chair on the tribunal.
If this is a program put together at the last minute, it involves two very real dangers. First, we have before us legislation with a very substantial capacity for abuse. This legislation could cause serious harm to individuals, and serious distortions in the economy. It may not have been well thought out. It is one thing to have arbitrary powers that were deliberately planned; it is another to have arbitrary powers that are open ended simply because you have not taken time to stake them out or nail them down.
If this program is jerry-built, thrown together at the last minute, and there is evidence to suggest it has been, we are in a situation where the government is asking the parliament of Canada to approve powers that are open ended, not because they need be, but because the Government of Canada did not take time to close them or tighten them up. It would be absolutely irresponsible of this parliament to allow that kind of proposal, if that was its genesis, to move unscathed and unamended through committee and be approved at final reading in this House.
The second danger with proceeding flippantly and without seriousness with the measures announced on commandeered national television the other night is that the government cannot again fail in dealing with inflation. The problems of inflation in Canada, and the effects it has on individual citizens from one coast to another, are simply too severe to go unresolved and unattended.
If the government is engaged in another public relations gesture and it fails, it will undermine not only its capacity to mobilize Canadians to try to deal with problems, it will undermine the capacities of parliament and governments to come. That can be particularly serious in a country like Canada.
I, like many of us, have watched with considerable interest, and one could use other language, the progress of the Prime Minister in office. I think the reality is clear to all of us that during his time of leadership in the country he has not given much priority to economic problems. We know he came to federal politics for reasons that were, by and large unrelated to economic problems. They were legitimate reasons in their own right. They had to do with the nature of participation in the federal public service and federal government by Francophones. That was an important motive to bring a man or men to Ottawa. There may be disagreement from time to time about other programs which that motive has led him to introduce, but I think it is recognized that that is why he came. I think it is also recognized that because of his preoccupation with that question other important questions, notably economic, have suffered from inattention.
We have not seen under his guidance a national economic policy designed to integrate the various components which together make up the economic fabric of Canada. This fault was compounded by the fact that until not long ago economic matters were presided over by a minister of finance whose only interest in his portfolio was to survive it. He was concerned that if he did his job as minister of finance it would prevent him having any chance of doing a

job as prime minister. And he preferred his ambition to his responsibilities. Whatever the causes, we were left for seven years without any co-ordinated economic policy.
I have to say to the present Minister of Finance that there was some hope when he was given the portfolio. Few of us on this side of the House, least of all myself, coming as I do from Alberta, have much reason to be endeared to the Minister of Finance. But all of us, I think, have recognized his ability. All of us have recognized his strength. I, personally, was impressed by the report that he apparently wished to leave politics and had to be persuaded to come back to take on his present portfolio.


The Acting Speaker (Mrs. Morin):: Order. I wonder whether the hon. member is not straying from the subject. Bill C-73 is an act to provide for the restraint of profit margins, prices, dividends and compensation in Canada. Perhaps the hon. member would direct his remarks to the bill.


Charles Joseph Clark: Thank you, Madam Speaker. I apologize if I appeared to be straying. I was seeking to indicate that we are dealing here with a piece of legislation which has a particular origin, and that it is important for us to understand why it has been brought forward and what its consequences might be. The point I was making is this: there has never been throughout the history of the government a commitment on economic issues such as would lead naturally to the kind of program we are considering here tonight. If any praise of the present Minister of Finance will result in my being accused of straying from the topic, I shall not praise him again. But I still say there had been some hope that his ability and his acknowledged strength would bring a change, and would at least pull together the strands of national economic policy. However, we must say, further in that regard that his performance in the debate on this bill has been disappointing because it confirmed some of our worst suspicions about him.


Donald Stovel Macdonald: I feel a lot better now!


Charles Joseph Clark: No program of controls will work in the absence of some degree of consensus, and it is certainly the responsibility of the Minister of Finance to seek such a consensus. Instead, the minister in his remarks engaged in personal attacks on the Leader of the Opposition (Mr. Stanfield), the leader of the New Democratic Party (Mr. Broadbent), and others in the House. Once again he revealed his penchant to divide. He is, unfortunately, a divider by nature. But, by duty, he must be a unifier, and what causes concern to those of us who want to see this program work is the early evidence that his nature is appearing to triumph over this duty.


Donald Stovel Macdonald: Come on, you are laughing yourself, Joe!


Charles Joseph Clark: No, it is not a laughing matter. It is a serious matter, because legislation of this kind can only become effective if there is a feeling of respect among the various elements in the economy, and it is a primary responsibility of the Minister of Finance to seek to achieve such a consensus and not to attack and divide, as the minister did in his opening address.
October 20, 1975

I suggest that two elements are essential if this program is to be taken seriously. First, the government must demonstrate leadership. It must try to unite people, including political parties, on this question. The Prime Minister must be involved, not on some television circuit arranged by Dick O'Hagan, but here in the House of Commons, bringing his own capacity for leadership into the issue. Second, there has to be a firm demonstration that further action is to follow-that the measure before us is not presented in a vacuum. An assurance must be forthcoming that this program of controls, which some of us suspect were thrown together at the last moment, will be accompanied by other serious measures. We expect the government to show much more determination about cutting down its own expenditures, thus giving the kind of leadership which is so important if a program of control and restraint is to be effective.
Unfortunately, the government has been playing a con game, concealing the real growth in its expenditures and in the role of the administration. Before the last election ministers claimed there had been an increase of only 11 per cent in the growth of government expenditures during the past fiscal year. Then, after election day, they brought in supplementary estimates which boosted that increase to 30 per cent. That is an indication of the attitude with which the government approaches its responsibility in the area of economic leadership. It is the kind of hocus pocus we must steer away from.
What is required if this program is to be effective is early and firm evidence that it is part of a package, that it is not the only hard piece in a set designed by Dick O'Hagan; there has to be an indication that the government is serious about moving on other economic fronts and that it is serious about cutting back some of its expenditures.
There has been too much ad hocery on the part of the government. Ministers have been making gestures toward the important problems of the day, but it is not enough in a time of industrial unrest to say simply that a committee is looking into the situation and that hopefully something will emerge, as the minister did the other day. It is not enough, when confronting the issue of the effect of power groups on the economy, for instance, simply to order an investigation-not because it is a continuing problem but because an embarrassing particular problem has been raised by the aspirations of Power Corporation; the government was looking for a way to avoid it, and that is how we got into the Bryce Commission. As I say, too much use is made of the ad hoc approach. This is very much in the nature of the former minister of finance who is very big on cosmetics but who did not undertake to provide Canada with the leadership it needed in dealing with various economic issues.
All of us who have talked to Canadians during the recess have become aware of the seriousness with which individual Canadians are viewing inflation. Small businessmen are wondering about their capacity to keep their businesses going. The problem is very deep, and the sense of despair about the government's recognition of the problem is very deep.
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Somebody asked me the other day: "Do any of you guys in Ottawa realize how serious things are?" I think that question is being posed at one level or another, in one way or another, by people all across the country, because people believe the problem is a serious one, one that requires response.
We on this side have indicated for a long time now that we are prepared to support any serious initiative that is taken, provided that there is a demonstration that the situation is crucial, providing there is a demonstration that, along with the controls and the excessive power which is given to the Minister of Finance, there will be action on other fronts and leadership of some other kind. I repeat what others on this side of the House have said. We are prepared to support in principle the measure that has been introduced so long as we receive demonstrations that the government is serious about this program, so long as we receive the kind of information that we will require in the standing committee and the government is responsive to some of the amendments we will be introducing to limit excessive powers which appear, on the face of the bill, to be granted this government.


William Arnold Peters: Madam Speaker, I have been very interested in the debate today and in the fact that on occasion the Chair has had to call members to order for not talking about the bill. I think the comments which have been made show how difficult it is to follow this piece of legislation.
The backbenchers in the Conservative party have been defending the idea of controls so long as they are removed after a short period of time. Somebody says after 90 days. We have just heard the backbenchers in the Liberal party make a great about-switch; I get the impression that this bill does not really matter to them at all. The principle is not involved. There has been little discussion of the principle of this bill.
The Conservatives have developed their policy over a period of time, but it is a policy with which I disagree. They know what their policy is and so do I, and I disagree with it. On the other hand the backbenchers in the Liberal party do not know what this is all about. They do not understand it. They are for the bill now because the Minister of Finance (Mr. Macdonald) has had to come up with a program in a very short period of time. So the members on that side are now for the bill. They were against it before, but perhaps they were mistaken. In any event, the climate has now changed, and as we are a long way from an election they say perhaps it is a good idea since the minister says it is just that.
That raises another interesting question. I should like to know why the former minister of finance quit his portfolio. Did he want stronger controls or less controls? Did he learn something in the international arena about the finances of Canada in relation to the finances of other countries that we know nothing about? Or did he just happen to decide to leave the ship? The new Minister of Finance was about to leave the ship as well and go back to greener pastures, but he decided to stay on and put through this piece of legislation. A large number of senior civil servants also left during the last year. Were they in

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favour of these controls while the government was not, or were they not in favour and some government members were in favour of them?
Members are being called to order for not talking about the bill, but let me tell you, Madam Speaker, that I have been here for a long time and I have read a lot of bills. I have not understood all of them but I did at least have a pretty good idea of what would be their effect. I was absent when the white paper was published and I had about the same opportunity that the general public had; I heard the Prime Minister (Mr. Trudeau) address the public on television, like Churchill but not nearly as well or as effectively. I do not think he put the message across in a way that is going to get much support, because the public have less faith in him and his ability to solve this problem these days. I listened to his pitch on television and I did not understand it. I talked to my constituents, and they said that they could not understand it either.
I have now read the bill but have not been able to get anything from it. If you are able to tell hon. members, Madam Speaker, that they are out of order because their remarks do not relate to the bill, then congratulations. There is really nothing in the bill that is definitive in any way, shape or form. The only date in the bill is the date it comes into effect, which is the date of the television program. The bill has no proclamation period, and there are no regulations or guidelines. The bill merely indicates that there will be wage and salary controls.
If hon. members want to know anything about this legislation they will have to read the white paper, which I presume is the guidelines. However, it really depends which publication you have. The last one I received was considered to be the minister's speech, the "Program for National Action". The first publication was the highlights, and the "Program for National Action" is the same information but under a different cover.
If this legislation is going to be effective it must have the support of the Canadian public. The Canadian public must recognize that there is a problem to be faced and they must be willing to make sacrifices. They must be sure that the situation is the same for all and that that is the way the problem will be solved. If that is the program the government is trying to sell, I suggest it scrap the program outlined in its "Attack on Inflation". Anyone reading that will be aware that this legislation has absolutely nothing to do with prices as they affect the individual. There is no indication of legislation there.
The board that is going to be set up will involve the employment of between 200 to 500 people. What is a woman to do if the price of baby food, or a package of cereal, or a piece of meat, or a can of vegetables goes up 10, 15 or 20 per cent? Her husband's wages are frozen. Is she to write to her member of parliament or to all members of parliament? I suggest she would have to mimeograph her letter and run off 700 to 800 copies, which she would send to all members of parliament, Senators, and members of the Anti-Inflation Board; she will be wasting her time but it will probably make her feel better.
There is no machinery in this bill to control prices. If the housewife, the worker, or indeed anybody is to believe in this program, it must work fairly and equally for everyone. Wages are very easy to control. If I had been asked to

come up with a program and I had been told by senior civil servants that this legislation is what I require I should have left out the part of the bill dealing with wage and salary controls, and instead controlled prices, because if you control prices, wages do not need to go up.
Many people forget that the figures being bandied around in relation to wage increases are 45 per cent and 50 per cent, but are related to long-term contracts, probably over three years, covering the year that has gone by and two years in the future. Everyone knows the cost of living has gone up 12 per cent, so you project the 12 per cent over the three-year contract and you arrive at 36 per cent. The workers want an increase over that of perhaps only 5 per cent, and that does not seem to be unreasonable, but it gives you another 15 per cent over the three year period and you wind up with the 50 per cent increase. All they are asking for is enough to stay even and maintain the standard of living to which they have become accustomed. This obviously is not an inflationary factor.
There are many things which are inflationary that are not mentioned. It is easy to control wages and salaries. That is relatively simple because there is usually a third party involved who is only too happy to control them. When you attempt to control the price of commodities then you run into great difficulties. Except during the war we in this country have never been able to control commodity prices in any way, shape, or form. During the war we accomplished this at the expense of one very large segment of our economy, namely, the agricultural segment. We appealed to those in the agricultural industry more than to anyone else to hold the line and keep down prices as their war effort. They did an admirable job, but they have been paying for it over the years since, as they have never really been able to get their prices up to the necessary level. It is easy to control wages, but it is impossible to control prices under our system.
I have looked at these proposals as they relate to the people in my area, and people in all parts of Canada, who belong to unions and who have been out on strike for some period of time. They now want to make a settlement but they do not intend to accept 8 per cent plus 2 per cent.
There are to be some exceptions, but how one obtains an exception no one seems to know. Maybe Jean-Luc can make an exception if he wants, or maybe Mrs. Plumptre can exempt someone.


An hon. Member:: How about the minister?


William Arnold Peters: I am not sure that we would want to ask the minister, nor am I sure that that should be his job. I am sure it is not going to be the little guy in National Revenue in Sudbury who will make that decision. When I asked him about the subject he said he had sent all that information to me yesterday by telex. I think he assumed I was in the department for which he was working. This was not an inquiry as far as he was concerned. He thought I wanted his name again, and he had already sent that in by telex the day before. These people are not going to be in a position to make exceptions.
Many exceptions will be made and, as soon as one is made, then as far as the average individual is concerned
October 20, 1975

there is no equality. It is a little bit like 50-50; that is, one horse and one rabbit, and most of the workers I know are going to fall in the rabbit category. This procedure of allowing exemptions will, in my opinion, create a nightmare that will be impossible to handle.
Inflation is a very complex thing. I was never too worried about inflation, and I guess most Liberals were not worried about it until very recently. They believed they could handle inflation in a relatively simple way. Many of us have not been particularly concerned as long as our productivity kept up with the inflationary rate. There did not seem to be anything too much wrong as long as that was the case, except you had to have a bigger wallet and carry more money, and the bills got bigger, but then again the amount you were receiving was larger so nothing really had changed. Instead of paying $1 for something you pay $2. But as long as you are getting twice as much it does not make any difference.
The difficulty results from the fact that inflation is now running at about 12 per cent per year. It is interesting to note the predictions which are being made as a result of this anti-inflationary legislation on which the government is going to stake its very existence.
What is this legislation going to mean as far as the financial institutions are concerned? They gave an indication in a survey carried out by about 10 of their corporations. They predict that the growth in national product will continue in 1976 at a rate between a low of 1 or 2 per cent to 5.8 per cent. This group of ten includes the Toron-to-Dominion Bank, the Royal Bank of Canada, the Bank of Montreal, the Bank of Nova Scotia; in other words, all our banks.
These corporations indicate that the consumer price index is going to increase next year with fully implemented controls in the range of about 9.5 per cent to 12 per cent. There is a low of 8 per cent predicted by the Dominion Securities Corporation.
What do these corporations consider the unemployment rate will be with full controls? The Royal Bank says the unemployment rate for next year will be between 7 per cent and IV2 per cent. The Toronto-Dominion Bank says the unemployment rate will be 7.3 per cent. Wood Gundy says the unemployment rate will be 7.9 per cent. The Bank of Montreal says it will be 7.6 per cent and, the Bank of Nova Scotia predicts 7.8 per cent. So most of these financial institutions feel the unemployment rate is not going to change, because these predictions fall within the range of unemployment at this time.
What do these institutions say about the growth of corporate profits? They indicate the growth will continue in 1976 in the range of from 8 per cent to 15 per cent. It is interesting to note that the Royal Bank considers the growth rate will be 12 per cent, the Toronto-Dominion Bank says 8 per cent, the Bank of Montreal says 13 per cent, the Canadian National Bank says 8 per cent, and the Imperial Bank of Commerce predicts it will be 10 per cent.
It does not appear to me that the government has accepted the advice or the predictions of the heads of some of these financial institutions, yet the minister must discuss the situation with some of these experts on the economy.
Anti-Inflation Act
Let me refer to predictions in respect of housing starts with these full controls. It is in this field that you can influence the social climate because there is a great need for housing in Canada. You can also influence the unemployment rate by building more houses. The Royal Bank predicts 200,000 housing starts for next year. The Toronto-Dominion Bank predicts 225,000. The Bank of Montreal says we can expect 210,000 and the Bank of Nova Scotia says there will be 215,000 housing starts.
The prime interest rate with controls in 1976 is projected to run from a high of 12 per cent to a low of 9.5 per cent. Most of the banks are predicting interest rates of 1014 per cent to 10'A per cent. Let me just read several comments made by the banks regarding the effects of controls.
Greenshields Inc. says in respect of the effects of the control program in 1976 that the government has to create credibility and acceptance, but there will be slow progress toward price improvement. The Royal Bank of Canada says that controls mean little since prior anticipation has reduced their effects on forecasts. The Toronto-Dominion Bank predicts a slightly lower rate of growth with increased unemployment as the price of controls.


An hon. Member:: We are going to roll back prices.


William Arnold Peters: You are going to roll them back, but that is not going to be done by this piece of legislation. I am not saying this myself, but rather I am quoting what some of the banks have indicated will be the effect of controls. The Bank of Montreal expects little impact during 1976 but some possible negative effect on growth in 1977 and 1978. The Bank of Nova Scotia says that controls may lower the growth rate to about 4 per cent in 1976 but may be beneficial in the long term. The Banque Canadienne Nationale predicts that the controls will have little effect on inflation but will have a more retarding effect on growth, and will lower consumption and savings.
If one looks at all the predictions made by our financial institutions it will be seen that they really do not say this program will have any beneficial effect on the economy, but rather, according to most of the predictions, that it will have a detrimental effect on employment. In my opinion there is no machinery that will have any effect on the cost of consumer goods.
It is very easy to do what most people do; they blame labour for their problems. It is a very interesting psychology. I had an opportunity to speak to some workers on a picket line. They had been on strike for a matter of seven or eight weeks. They were interested in talking to me, but rather than speak about their problems or their strike they were interested in talking to me about the terrible state of affairs that would develop if the postal workers went on strike.
One can see that it all depends on where one is sitting, and whether one is having some difficulty. Most of these people who were on strike were not in difficulty but were assuming there would be a difficulty if someone else went on strike. So, it is easy to focus attention on the labour movement and say that everything will be solved if there are cut-backs. It would be very difficult for most uinons to get any benefits out of the COLA clauses, which are the

October 20, 1975
Anti-Inflation Act
cost of living clauses contained in some contracts, if the cost of living were not increasing so rapidly.
This reminds me of the time when the national director of the steel workers' union spoke at a conference which I attended. He raised the roof about the COLA-type clauses in the contracts because he found that the workers ran down to the post office and got the increase from the post office rather than through union negotiations. The higher the cost of living went the more money these people received, and they seemed to believe this was an acceptable situation. The national director of the union at that time said that the two things should stand on their own. He said that the workers should bargain for their increases and that any increase in the cost of living should be handled in a separate way rather than through a COLA contract. We are and have been for some time faced with the problem of workers trying to catch up.
I should like to ask the backbenchers of the Liberal Party, particularly the members from British Columbia, a question about the situation in that province. In the province of British Columbia there have been many strikes, and the cost of living and the cost of welfare are very high. The myth has been built up concerning the beautiful weather on the west coast, a land of milk and honey. The young people who are growing up do not celebrate by getting drunk but rather by going to British Columbia, where they end up spending six or seven months enjoying British Columbia hospitality. They have added to the problems of British Columbia.
The cost of living there is exceedingly high. Labour demands are exceedingly high, and there have been a large number of strikes. I should like to ask the members on the government side from British Columbia how they justify what I imagine they would consider to be a reasonable situation if, when after a period of time the labour disputes had not been settled in that province, the province of British Columbia took rather strong measures and said that everybody had to go back to work, that the contracts had to be settled, and then the federal government came along with this kind of control program which has no relationship to the negotiations which had taken place and which has no relationship really to the proposals of either the companies or the workers.
A number of things are different in that province. Much of the difficulty in the lumber and pulp and paper industry was caused by the desire of the industry to unload inventory and to obtain an increase in the price of its products on the international market, both of which would provide more money for a company. Of course the company was not unrealistic in its belief that this probably would mean an increase for the workers in that industry as well. However, I should like to know what the answer will be to this problem now. Will the British Columbia government go to the people in the case of British Columbia versus the federal government again, as has been the case in respect of the provinces? Is that really what this is set up for Madam Speaker? If this is the situation, then it would seem to me that the program is rather divisive and in the long run really will not produce the desired results.

I believe that if this program is to be realistic, and we just set about doing something inside Canada without taking into consideration international markets, international sales and international exports, we will have to develop a very strong national purpose. It seems to me that that national purpose should be spelled out very clearly, and that equality under that national purpose must be guaranteed. From my reading of this bill I suggest there is anything but a guarantee that it will have the effect of equality between the amount of money the workers and the salary earners in this country need and the amount of money that is necessary for the other segments of the economy. It is wage control; it is not, in any shape or form, price control. May I call it ten o'clock, Madam Speaker?



PROCEEDINGS ON ADJOURNMENT MOTION

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

A. Daniel McKenzie: Madam Speaker, I wish to discuss the placing of a new national revenue tax data centre in a CAE aircraft building at 570 Ferry Road in Winnipeg. The official announcement was made in Winnipeg in September.
I placed a question on the order paper in regard to the costs of renting and renovations which would be required to this CAE building. In the answer I received, the federal government stated that it would be renting the building for three years and the federal Department of Public Works would be spending $1,760,000 on renovations. Why is the government paying for the renovations? I understand that the government is paying CAE approximately $4 per square foot for rent when the going rate for this type of building is approximately $2.50 per square foot.
It appears to me that we have the makings of a monstrous blunder and one that will cost the Canadian taxpayer untold millions. Why didn't the Department of Public Works call for tenders for a new building to be built which could handle the department's needs for years to come? As the government has stated, a permanent home for the tax data centre will be built at an established cost of $15 million within four years. It is quite apparent that there has been no long range planning.
When you take into consideration the interest to be paid on the $1,700,000 for renovations, the moving costs that are involved, and the added inconvenience of moving, an entire new building could be erected for the amount that will have to be spent.
In my research into this transaction I contacted experts in the construction industry who informed me that if you were to add up the interest charges on $1,700,000, the rent at approximately $4 per square foot, and the operating costs-in a leased building the owner pays all the operating costs-for the three years it will cost the government
October 20, 1975

approximately $15 per square foot. However, if the government were to erect a new building, the cost would be approximately $8 a square foot, or $611,000 less in rent and interest charges per year.
In short, it is costing the government double in rent and interest charges to take the CAE building rather than leasing a new building in which case allowances could have been made for future expansion, saving millions of dollars over the years. Four other tax data centres are being planned for across Canada, and all I can hope is that the building negotiations are not being handled in the same way.
I would like to raise another two points. The construction of a new building would have been completed in a shorter period of time than it is taking to renovate the CAE building. The renovations are nowhere near completion, and I cannot foresee the government meeting its deadline of January 1, 1976, to start its decentralization program.
Is this another costly blunder similar to the move made by the federal government and Air Canada in having CAE overhaul the obsolete Viscounts which are still not airworthy, in an effort to appease Manitobans at a cost of millions? These Viscounts are now just rotting at the Winnipeg airport.
Perhaps the Minister of National Defence (Mr. Richardson) can throw some light on this tax data centre deal with the CAE. Did he by any chance pressure the government to place the data centre in the CAE building so that he could say that he had obtained another contract for CAE and western Canada? If he did do this, this is not the type of under the table deals that Canadians want.
In an answer to my question on the order paper it was stated that the Metropolitan Estates Properties Corporation had submitted a tender to construct a new building but the government had turned down their offer. I hope that tonight the parliamentary secretary can inform the House what was in the Metropolitan Estates Properties Corporation submission, and also provide the Canadian public with a complete explanation of this whole transaction.
In closing, I would say that at least $4 million to $5 million of taxpayers' money could have been saved if a new leased building had been obtained in place of the temporary renting of the CAE building.


Mr. Alexandre Cyr (Parliamentary Secretary to Minister of Public Works):: Madam Speaker, I carefully listened to the statement of the hon. member for Winnipeg South Centre (Mr. McKenzie) and I congratulate him as well as the hon. member for St. Boniface for their interest in the government project for greater Winnipeg. The Parliamentary Secrtary to the President of the Privy Council (Mr. Blais) has already replied to the hon. member and I am advised that the Department of Public Works has no further information to give at the present time.
Adjournment Debate


NATIONAL DEFENCE-EFFECT OF ANTI-INFLATION PROGRAM ON CHOICE OF LONG RANGE PATROL AIRCRAFT
Mr. Allan B. McKinnon (Victoria):: Madam Speaker, I rise because of the unsatisfactory answer given to a question of mine last week, on October 16, when I inquired once again about the government's plans for purchasing long range patrol aircraft. At that time the Minister of National Defence (Mr. Richardson) said:
Mr. Speaker, major decisions on procurement are before the cabinet at present in the form of the forces structure review and when the decisions have been reached they will be announced in the usual way.
This is the same kind of answer we have been getting for several years.
If one does not buy any clothes for years, then one's entire wardrobe needs replacing. This is the situation with Canada's armed forces. Since the Prime Minister (Mr. Trudeau) came to power, no equipment replacement program has been initiated and brought to fruition. Now everything needs to be replaced-tanks, planes, and ships. The false economy of postponing expenditures is exemplified in the long range patrol aircraft replacement fiasco.
On March 17, 1969, Mr. Cadieux, then minister of national defence, said that a replacement for the Argus was "under active consideration". In the six years plus since then the pages of Hansard and the minutes of the Committee on External Affairs and National Defence are dotted with promises and assurances that progress was being made. This glacier-like progress eventually resulted in the present Minister of National Defence announcing that the choice was down to four companies, then in 1973 down to two.
This led to a "contract definition phase" in which, curiously enough, Canada was to pay Boeing and Lockheed something over $11 million to make sales pitches to us for their product. The proposals were to include performance capabilities, technical specifications, production schedules, and costs of the aircraft, as well as the employment opportunities and industrial benefits which would accrue to Canada. In November of 1974 the minister stated unequivocally that the decision would be taken in April, May, or June 1975. The prices in the submissions would hold, provided the contract was signed by August 2, 1975.
It looked as if the government had finally been backed into a corner where a decision would have to be made, but one should never underestimate this government's ability to procrastinate, particularly in defence purchases. The questioning continued through the winter, and last spring we were assured that everything was going according to plan. Then, on July 25, the Department of National Defence issued a very short press release which repeated that the proposals had been narrowed down to two, and then stated that "as the decision cannot be made separately from the government's plan to restructure the Canadian air frame industry, the decision on the long range patrol aircraft has been deferred until later this year."
This is how $11 million was wasted-to give the government two years to procrastinate. If any further evidence were needed to testify to the extinction of the contract definition plan, it was supplied by the minister's statement last week that Canada was now considering pur-

October 20, 1975
Adjournment Debate
chase of the Orion P-3C "off the shelf". Gone was the necessity for a Canadian involvement in construction. Gone was the necessity for Canadian manufacture of the necessary electronic and surveillance systems. And gone also was $11 million.
Last month I attended the North Atlantic Assembly meeting as leader of the Canadian delegation to the military committee of that august body. On the first morning of the meeting the rapporteur of the military committee, whose job it is to prepare a general report on the security of the alliance, came to see me about what I agreed was a matter of some urgency. It had been suggested to him that the following statement should be included in his general report on the security of the alliance as a new paragraph 9(a). It reads as follows:
The situation regarding Canadian military forces is far from satisfactory; the strength of their active forces has been reduced and no decisions have been made to replace major items of equipment for the land and air forces which have now become obsolete. A review of Canadian forces this year is likely to substantiate even more strongly the picture of Canada as a country determined to participate actively in, and influence the political councils of NATO, anxious to maintain her economic links with Europe, but unwilling to make a contribution to alliance defence which is commensurate either with these aspirations or her economic strength.
I was able to convince the rapporteur not to include that as it was too embarrassing for an all-party delegation to NATO, as it was the fault of only one party in this parliament-mainly a very selective group of the Prime Minister and the Minister of National Defence.
When we tracked back to see where the idea to include this paragraph originated we discovered it came from a person holding rank at the assistant secretary-general level in NATO, one can only assume this is the true opinion that NATO has of Canada as an ally.
I regret to say that both the Prime Minister and the Minister of National Defence frequently return from NATO and tell us that all is well, when such is not the case. When I receive an answer such as I did the other day to a legitimate question about the LRPA replacement, that is not good enough for this parliament, not good enough for the people of Canada and most particularly not good enough for the men and women of our armed forces who have been so misled, misinformed, and deceived by the Minister of National Defence and the Prime Minister.


Mr. Maurice A. Dionne (Parliamentary Secretary to Minister of National Defence):: Madam Speaker, from the language used by the hon. member it seems rather obvious that he is more interested in debate than an answer.
With regard to the question, it is pretty much a reiteration of the question he posed to the minister last week. As he himself has stated tonight, in response to his question on the procurement of new aircraft, specifically long range patrol aircraft, I can only repeat what the minister has said. The program is currently before cabinet in the form of the forces structure review, and when decisions on the matter have been taken, they will be announced.
The hon. member is also aware, although his words tonight did not indicate his awareness, that Canada has every intention of maintaining its level of contribution to

the NATO alliance. The form in which this contribution will be made is also being considered as part of the defence structure review.
I,	personally, spent a week at NATO headquarters last spring and certainly did not note the kind of atmosphere to which the hon. member referred this evening. I found the morale of the people there very high and all our allies, including the Secretary General of NATO, showed a high appreciation for the part Canada plays in NATO.


PENITENTIARIES-PROPOSED INSTITUTION AT MORNA, NEW BRUNSWICK-GOVERNMENT POSITION IN VIEW OF OBJECTIONS
Mr. Fred McCain (Carleton-Charlotte):: Madam Speaker, under date of May 23 the Solicitor General (Mr. All-mand) advised me by letter of plans to construct a new medium security institution in that part of the city of Saint John which is part of the constituency of Carleton-Charlotte.
Upon receipt of the letter on May 29 I phoned the minister's office and requested a map to show the exact location proposed for the institution. Despite repeated requests by telephone to the minister's office and in person to the minister, no map was supplied. On July 9 I wrote to the minister, repeating my request for the map. It was my intention to send a letter to all boxholders in the area concerned, to determine what their wishes might be in respect of the location of a penal institution in their neighbourhood. Without such information I would not be a reliable source of information for the minister. It would be meaningless to submit a questionnaire without knowing the exact location of the proposed site.
On July 28 I eventually mailed the questionnaires to the residents of the west Saint John area of the Carleton-Charlotte constituency. On the same day we learned that there might be another possible location for the institution and additional questionnaires were sent to the Lepreau-Maces Bay area of the constituency.
Under date of July 29 the map arrived at my office. Although the questionnaires had been mailed, the map was forwarded to the Saint John daily paper and published. This was helpful for those who answered the questionnaire.
In response to the 1,600 questionnaires, 450 people expressed their wishes. In the result, 94 per cent said they did not want the institution built in the area, 1 per cent were undecided, and 5 per cent favoured the west Saint John location. Such a number of replies and the resounding no makes it absolutely binding upon me to ask the minister to choose another location.
Since the first suggestion that a medium security institution should be built in the Saint John area, the public has protested bitterly. A petition against its location bore 1,400 names and was presented to the Common Council of the city of Saint John. This was supported by letters to the editor and an editorial in the Saint John Telegraph Journal of August 6, 1975. I quote the editorial in part, to reflect the feeling of the editor, as he, in turn, reflected the sentiments of the residents concerned. Referring to the map, the editor said:
October 20, 1975

It shows, with somewhat shocking clarity, just how close the proposed new federal prison would be to built-up residential areas of Saint John.
I made the first appeal, on behalf of my constituents, in question form to the minister; on July 9, 1975, I asked him to change the location, as recorded in Hansard, page 7390. On September 19, in response to the overwhelming opposition expressed in answer to my questionnaire, I wrote to the minister, saying that, "You may adjust your plans in accordance with the citizens' wishes." On September 30 I had a phone call from a reliable source-I am sure the minister agrees that the source is reliable-saying that the minister never received any letter of protest from me. This took place 11 days after the letter was sent by hand to the minister's office. The letter was acknowledged by a member of his staff on September 24, 1975. The minister is reputed to have said that since he did not read the Saint John papers, he was not aware of the protests. The message had been delivered, but the mail did not reach his desk apparently.
Again on Thursday last I asked the minister if he would reconsider, as reported in Hansard at page 8260, and again the answer was no.
On behalf of those who live near the proposed site, I say the minister must build elsewhere. Dorchester needs and wants increased employment. I ask the minister to read the Globe and Mail of August 25, 1975, and to ask the Minister of State (Fisheries) (Mr. LeBlanc), the representative of that area.
The Blue Mountain minimum security site is still in the hands of the government. Some of the facilities at least are in place. I believe that the hon. member for Northumber-land-Miramichi (Mr. Dionne) has invited the minister to build there. In view of these options, one writer said "This seems completely absurd."
The minister asked for my opinion and my support. I cannot give my support for the location in the west Saint John area. I must ask in the firmest manner that he not authorize the construction in west Saint John, Mace's Bay or Lepreau, unless of course he would be as politically unwise as the advice of Mr. Therien, the federal penitentiary commissioner, would have him be. I ask the minister to look at the October 14,	1975, issue of the
Telegraph-Journal.
The institutions are wanted and needed in some areas. Accept the invitations. Do not thrust your unwanted presence onto the people of west Saint John.


Mr. Hugh Poulin (Parliamentary Secretary to Solicitor General):: Madam Speaker, may I first assure the hon. member for Carleton-Charlotte (Mr. McCain) that it is the intention of the minister and the department to give every consideration to public opinion in that area. In fact there has been ongoing consultation between all levels of government with respect to this matter.
This matter was raised in the House of Commons during the oral question period on Thursday, October 16. In answer, the Solicitor General (Mr. Allmand) indicated that he had not abandoned plans for the construction of a
Adjournment Debate
penal institution in the Morna neighbourhood in the city of Saint John, New Brunswick, at this point because the government had received approval in principle from the New Brunswick provincial government and from certain persons associated with the government of the city of Saint John. He also indicated that a further meeting of the council of the city of Saint John was to be held shortly and that he would await the decision that would follow that meeting. In fact a meeting of the council of the city of Saint John is to be held in the near future at which our application to purchase property in the Saint John area will be presented.
The five year construction plan of the penitentiary service in the Atlantic provinces provides for the construction of a new maximum security institution in Dorchester, New Brunswick, some medical facilities in Nova Scotia, and the construction of a medium security institution in close proximity to the city of Saint John, New Brunswick.
The penitentiary service believes that there is a need for an institution at close proximity to the city of Saint John as a number of inmates are native to the area and would like to re-establish themselves there upon release. As a result, it is planned to construct a small institution to house approximately 180 inmates in a medium security setting. The inmates who will be incarcerated there will be classified as not dangerous, and with the improved security perimeter system and dynamic security program, the risk of escape will be appreciably reduced. The penitentiary service's experience shows that such an institution does not have a depressing effect on the morale of a community and does not inhibit the normal pursuits and activities of its citizens. The site at present under consideration appears to be suitable for that purpose.
The City of Saint John is being consulted on all aspects of the location and development of the proposed institution. I wish to assure the hon. member that any decision on whether or not to proceed will take into full consideration the outcome of the consultations between the penitentiary service, the federal Department of Public Works, and the Council of the City of Saint John, as well as the outcome of surveys of community opinion. As stated by the Solicitor General in his answer to the question I referred to earlier, if there is overwhelming objection to the site, consideration will be given to abandoning this plan.
I,	as a member for this area, the city of Ottawa, have no trouble whatever in obtaining from the council any plans that I need with respect to specific locations, and I suggest to the hon. member that he could obtain the information he needs through a similar channel. I realize that throughout the summer months it is not as easy to obtain information as when the House is in full swing-


The Acting Speaker (Mrs. Morin):: Order. I regret to interrupt the hon. gentleman but the time allotted to him has now expired.
Motion agreed to and the House adjourned at 10.24 p.m.

Tuesday, October 21, 1975