1976-11-04

ROUTINE PROCEEDINGS


Mr. Ron Huntington (Capilano):: Mr. Speaker, 1 rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43 to ask the unanimous consent of the House. Whereas the Hon. President of the Treasury Board (Mr. Andras) stated, in answer to a question by the hon. member for York-Simcoe (Mr. Stevens) that the financing for the Les Terrasses project was voted and approved by Treasury Board and that the proceedings would "stand examination", I move, seconded by the hon. member for York-Simcoe:
That this House instruct the President of the Treasury Board to table all minutes of the proceedings and meetings by Treasury Board touching this matter.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Such a motion pursuant to Standing Order 43 can only be presented with the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


FINANCE
Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, I rise on a matter of urgent and pressing necessity, affecting the financial stability of this country. Press reports and press releases have indicated that the Minister of Finance (Mr. Macdonald) was in Manila just over a month ago discussing the international financial situation, with particular reference to currency flows, with IMF and World Bank officials. Noting that discussions in which the minister participated may have substantial consequences for the future stability of the Canadian dollar in the event of international currency difficulties, and that Bill
C-5 the Currency and Exchange Act Amendments that are proposed will affect the manner in which losses in exchange transactions are accounted, I move, seconded by the hon. member for Capilano (Mr. Huntington):
That this House instruct the Minister of Finance to prepare a report on his activities in Manila detailing the nature of substantial discussions and/or commitments made on behalf of Canada, and that this report be tabled before Bill C-5 is called for second reading.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


HUMAN RIGHTS
Mr. Jake Epp (Provencher):: Mr. Speaker, pursuant to the terms of Standing Order 43, I request unanimous consent of the House to present a motion dealing with a matter of urgent and pressing necessity.
In view of the fact that Christians and other religious believers in the Soviet Union are being persecuted simply because they desire to worship God according to the dictates of their conscience and the precepts of their faith rather than according to the dictates of the state; and in view of the fact that a symbol of the denial of basic human rights by the Soviet Union is the imprisonment for five years at hard labour of Georgi Vins, Secretary for the Council for the Evangelical Christians and Baptists, for the alleged crime of administering to the congregation that elected him as their pastor, and the continuing persecution of the Vins family, which for three generations has suffered imprisonment and death, I move, seconded by the hon. member for Selkirk (Mr. Whiteway):
That members of this House urge the Prime Minister to make representation to the government of the U.S.S.R. that Georgi Vins be released from imprisonment and that the government of the Soviet Union allow him and all other religious believers within its borders to worship God freely according to their own consciences, as the Soviet Union is committed to do by the provisions of its constitution and by the provisions of the United Nations Covenant on Civil and Political Rights which the Soviet Union has ratified.


Some hon. Members:: Hear, hear!


Mr. Speaker:: The presentation of such a motion pursuant to Standing Order 43 can only be done with the consent of the House. Is there unanimous consent?


Oral Questions


Some hon. Members:: Agreed.


Some hon. Members:: No.



EXTERNAL AFFAIRS


Mr. Perrin Beatty (Wellington-Grey-Dufferin-Waterloo):: Mr. Speaker, I rise on a matter of urgent and pressing necessity to seek leave to move a motion under the provisions of Standing Order 43. In view of the fact that the Helsinki agreement requires that all signatories deal with the reunification of families "in a positive and expeditious spirit" and in view of the Russian government's refusal to respond favourably to the representations by the Secretary of State for External Affairs (Mr. Jamieson) on behalf of Nailya Bibersh-tein and some 300 other families which are split between Canada and Russia, I would move, seconded by the hon. member for Hastings (Mr. Ellis):
That this House unanimously regrets the refusal of the Russian government to expedite the reunification of families according to the terms of the Helsinki agreement and this House accordingly instructs the Secretary of State for External Affairs to inform the ambassador of the U.S.S.R. of the Canadian people's desire for early compliance with the terms of the Helsinki agreement as they relate to the reunification of families.


Mr. Speaker:: Such a motion pursuant to Standing Order 43 can only be presented to the House with its unanimous consent. Is there unanimous consent?
Some hon Members: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Mr. James Gillies (Don Valley):: Mr. Speaker, my question is to the Minister of Energy, Mines and Resources. It arises out of a concern for a lack of coherent policy for energy, as demonstrated by the situation in connection with the oil sands. Given the fact that according to its recent strategy report, the government is counting on producing at least one out of every four barrels of crude oil in Canada by 1990 from the tar sands, what policy will the government put into effect in order to again start operation of the oil sands, which have now come to practically a total stop?
[Mr. Speaker.l
Hon. Alastair Gillespie (Minister of Energy, Mines and
Resources): Mr. Speaker, the hon. member will realize that is a very general question. I can tell him quite specifically that I met with the energy minister of Alberta very recently and also the energy minister of Saskatchewan to deal specifically with some of these very important questions. I am referring to the Athabasca tar sands, the Cold Lake deposit and of course the Lloydminster deposits as well. I put forward a proposal to the energy minister. He is now discussing it with his colleagues and I am awaiting his reply.


James McPhail Gillies: I thank the minister for that very general answer. Now that Shell has pulled out of its operations in oil sands, and since it looks as though there will be no new operations for at least five years, would the minister tell us specifically what he is doing to try to get that Shell project, or a project of similar dimensions, started right away?


Mr. Gillespie:: Very specifically, we are trying to work out a deal with Alberta.


Some hon. Members:: Hear, hear!


James McPhail Gillies: We need a new government from this side to get that done.


Some hon. Members:: Oh!


James McPhail Gillies: Would the minister tell us, then, specifically what the federal government has proposed to the Province of Alberta which will ensure that this project and other projects, for example in the Cold Lake area, for example, will get under
way?


Alastair William Gillespie: There were a number of elements in the proposal I put forward-I do not think this is the time to discuss them. They are under consideration by the government of Alberta and I very much hope to get a reply shortly. At the appropriate moment I would be glad to pursue this matter with hon. members.


GOVERNMENT MEASURES TO INCREASE EXPLORATION IN FRONTIER AREAS
Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, I, too, have a question for the Minister of Energy, Mines and Resources. 1 wish to ask him about what appears to be a conspicuous lack of success in moving toward his target of doubling Canadian frontier exploration in view of the fact that the government is skimming off $3 million a day from oil production revenues which is twice as much as it is putting back into the entire energy sector. Can the minister tell us whether he intends to enhance the financial environment of the industry so that more can be accomplished?


Alastair William Gillespie: The hon. member has tunnel vision if he is looking at oil revenues in those terms. He seems to have forgotten the substantial fiscal commitment the Government of Canada has


made through the compensation account, through investment in Syncrude and through investment in Panarctic and in Petro-Canada. I can understand why he would not want to focus on all those things; his party was against Petro-Canada.


A. Daniel McKenzie: If there is any tunnelling going on, it is being done by the government which is tunnelling these revenues into general revenue, and that is not the purpose of those revenues.


Some hon. Members:: Hear, hear!


A. Daniel McKenzie: Will the minister tell the House why completions in the north will be down by almost 50 per cent while in Alberta, where the provincial government has acted to provide incentive, work is proceeding at record rates?


Alastair William Gillespie: As the hon. member knows perfectly well, you just don't turn the tap on that quickly.


Mr. Fraser:: You turned it off quickly enough!


Some hon. Members:: Oh!


Alastair William Gillespie: Do you fellows want an answer or don't you? Maybe you should get your own leader to clear up his own position on Petro-Canada.


Some hon. Members:: Hear, hear!


Alastair William Gillespie: 1 understand he has not made up his mind whether to wind it up or wind it down. We on this side introduced a whole new set of fiscal incentives. We set, as a target, the doubling of exploration in the north. We have set forth a new set of proposals with respect to oil and gas regulations. 1 would expect that activity to start to build. As the hon. member knows, it is very costly and there is a very short season. 1 did not hear the hon. member or his party supporting us in our tough decision to drill in the Beaufort Sea.


CONFLICT OF INTEREST
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, it is always good to hear, if rarely, the government defending public enterprise. I should like to shift to another matter regarding which the official opposition is also in a little difficulty these days. Given the Leader of the Official Opposition's decision not to reveal any conflict of interest situation that he might discover in his own caucus-


Some hon. Members:: Shame.


John Edward Broadbent: -and given also the important right of the public to have access to such information, 1 should like to ask the Acting Prime Minister whether he would assure the House that the government will act as soon as possible to implement
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the recommendations of the House and Senate committees' reports, which the government has had for sometime, on this important subject, with the one important change, namely that the financial interests of members of parliament be made public in whatever action is taken, as is now the practice in the United Kingdom.


Hon. Allan J. MacEachen (Acting Prime Minister):: Mr. Speaker, I think it was made clear earlier in the week by the Prime Minister that at the present time the government has under consideration the reports of both the standing committee of the House and the Senate committee on the green paper on conflict of interest, which I had tabled in the House some years ago. I must say that the government is not encouraged by any speed that was shown by either chamber in dealing with this matter, but we intend to follow it through and, we hope, introduce a bill entitled "the Independence of Parliament Act" that will cover these important matters.


John Edward Broadbent: A supplementary question, Mr. Speaker. The Acting Prime Minister speaks of the need for speed. He knows that he has had the House's report for 15 months and that the government has not acted yet. Given the fact that neither the green paper nor the report of the House committee went as far as the system which is now in operation in Great Britain whereby financial interests disclosures are made available to the public in general, will the Acting Prime Minister assure the House when the government finally acts in this important area it will duplicate that very important and positive practice of the government of the United Kingdom?


Allan Joseph MacEachen: Mr. Speaker, 1 would be happy to look at the precedents in the United Kingdom but as the hon. member knows there are two ways recommended in the conflict of interest paper for dealing with the subject. One is full disclosure; the other is to set up a way by which the conflict itself is extinguished. One of these methods will be followed generally in the bill that will be brought forward.


John Edward Broadbent: A final supplementary question, Mr. Speaker. Just so that we do not have to wait another 15 months, would the Acting Prime Minister tell the House whether we will have legislation before Christmas on this important matter, or if legislation is not contemplated are other procedures going to be followed to act upon these committee reports, and will that action be taken before Christmas?


Allan Joseph MacEachen: Mr. Speaker, as I have indicated to the hon. member, at the present time we are considering as a matter of urgency the reports of both Houses. It is my intention to bring forward legislative measures as soon as possible. Whether that will occur before Christmas is something I cannot guarantee at this moment.


Oral Questions


MANPOWER
Mr.   C.-A. Gauthier@Roberval: Mr. Speaker, I wish to ask a question of the Minister of Manpower and Immigration.
Given the number of protests we have received concerning the selection of workers for LIP projects, it would appear that officials unilaterally prepare the list of those who are registered with manpower centres without any consideration for the needs of promoters and workers' qualifications. I think that project managers should be consulted, particularly when they back up those projects to the tune of 40 to 50 per cent. Can the minister tell the House if it is the new approach used this year and if he has issued directives to have this unilateral selection followed?


Hon. Jack Cullen (Minister of Manpower and Immigration):: No, Mr. Speaker, we have to look at the situation described by the hon. member.


Mr. Gauthier (Roberval):: I wish to ask a supplementary.
I thank the minister for his answer, and I would ask him, while dealing with the situation, to consider the anti-alcoholic program. Is it normal that people used to working with alcoholics were replaced by others who know precious little about that disease? What does the minister intend to do about that?


Jack Sydney George (Bud) Cullen: Mr. Speaker, we will have to make an expertise. We will make a thorough examination of that situation.


OIL-REQUEST FOR CLARIFICATION OF REGULATIONS GOVERNING EXPLORATION IN THE NORTH
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I have a question for the Minister of Energy, Mines and Resources in light of the answers he has given today. In view of the serious problems being caused to petroleum development in the north and offshore by the proposed right of Petro-Canada to acquire up to 25 per cent of existing undiscovered plays, will the minister take steps to assure those operators in the frontiers who have spent as much as $30 million on a single well will not have their equity diluted to the point where reasonable incentives no longer exist and they therefore cease to explore for the gas and oil so important to the economy?


Alastair William Gillespie: Mr. Speaker, I agree with the hon. member that this is important to Canada. I also believe it is in the self-interest of corporations to explore for oil in the north of Canada. It

is our policy to insure that the regime is such that the interest of the companies themselves will continue.


Eldon Mattison Woolliams: A supplementary question, Mr. Speaker. In light of the fact that the government vacillated and procrastinated on regulations and in light of the further delay in the promulgation of the new land regulations, will the minister expedite final resolution of the right of Petro-Canada to "back-into" prospects so that at the very least some regime may exist for those who must carry on business in the frontier, thus clearing up the matter, so that the companies know where they stand and Petro-Canada knows where it stands?


Alastair William Gillespie: Mr. Speaker, the hon. member will have plenty of opportunities to make his points when the bill goes to committee.


An hon. Member:: Oh come on.


Eldon Mattison Woolliams: A further supplementary, Mr. Speaker. 1 should like to ask the minister how long we have to wait. We have been waiting for three years and now he is putting us off saying that we will have it before the committee and we will be able to make submissions then. How long does the country have to wait? How long does the industry have to wait? How long does Petro-Canada have to wait?


SUGGESTED INCREASE IN FUNDS FOR RESEARCH ON ALTERNATIVE SOURCES
Mr. David MacDonald (Egmont):: Mr. Speaker, my question is also for the Minister of Energy, Mines and Resources. In the current fiscal year the United States government is spending roughly $290 million on renewable energy research and development which is equal to 12 per cent of their nuclear energy research and development budget. Given that the equivalent figure for Canada is a minuscule $4.7 million, is the minister prepared to reconsider his department's research priorities before we lose all initiative in this field? Is he perhaps prepared to view favourably the requests for innovative research funding such as recently made by the Premier of Prince Edward Island for funds for alternative energy for that province?


Alastair William Gillespie: Mr. Speaker, at the present time there is a paper before my Cabinet colleagues which deals with this question of government priorities, more specifically the question of incremental funds that may become available for energy research and development this year. I can assure the hon. member that in terms of incremental funds I give first priority to research and development in renewable energy resources.


FUNDY TIDAL POWER PROJECT-REQUEST FOR REPORT ON STATUS OF PROJECT
Mr. J. P. Nowlan (Annapolis Valley):: Mr. Speaker, I have a supplementary question for the Minister of Energy, Mines and Resources. I am glad to note the interest of the minister in


renewable resources. My question is: What is the present status of the reassessment of the review or report on Fundy tidal power which was tabled in this House in 1969?


Alastair William Gillespie: Mr. Speaker, if the hon. member had been following the events he would know that the first step of phase one has been completed and that a report has been made. Three or possibly four sites have been identified, from over some 30 sites, as being the best bet, which is I think all I can say at the present time. The work is now going on in respect of those four sites to establish the economic viability of those sites. As the hon. member knows the question is not so much a technical one but is far more an economic and environmental one.


John Patrick (Pat) Nowlan: Mr. Speaker, I am quite aware of the progress of this development since the tides of the Bay of Fundy wash twice a day against my constituency. I should like to ask if the minister is going to expedite or activate a decision in this regard since we have been waiting for seven years now in which time man has gone to the moon and the James Bay project is off the drawing board and almost in production. When can we expect the next stage? Is the minister doing anything to activate the situation in view of the very serious energy crisis in Atlantic Canada.


Alastair William Gillespie: Mr. Speaker, I regret that the hon. member did not listen to my last answer. If he had he would have heard that stage one of phase one has been completed and we have now moved on to the second stage which has to do with determining the economic viability of those four sites. That work should be completed I hope very early next year. That then becomes a second decision point. The decision will then be as to whether or not very much more substantial resources, in the tens of millions of dollars perhaps, will have to be spent on engineering work for a specific site.
[DOT] * *


EXTERNAL AFFAIRS
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, my question is directed to the Secretary of State for External Affairs. First, I want to say that 1 am enthusiastic in following him in his peregrinations since the assumption of the portfolio. I shall not be able to ask all the questions I would like to ask because it would take quite a while. I ask him first whether he will do that which was done under the administration of Mr. King, Mr. St. Laurent, Mr. Pearson and myself whereby a couple of days would be set aside by the government, not as opposition days but as days set aside by the government, for the discussion of external affairs because so far as members of this House are concerned they know absolutely nothing concerning what the government is doing in connection with the problems affecting the peace of the world.
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Hon. Donald C. Jamieson (Secretary of State for External Affairs):: Mr. Speaker, I suppose I could interpret that question as having been somewhat argumentative in tone. In so far as giving the House an opportunity I, of course, would be glad to do that.
It seems to me, however, that in the eras to which he referred of the former prime ministers, including himself, there were not in fact designated opposition days to the extent there are now. If the opposition so wishes they can put down that subject or there may be other forums. But let me assure the hon. member that I would be glad to answer whatever question he or other members might have.


SOVIET UNION-ALLEGED CRUELTY AGAINST PEOPLE OF UKRAINE-DISCUSSION BETWEEN MINISTER AND MR. GROMYKO
John George Diefenbaker: Mr. Speaker, my first question is, when he was in Moscow and met with Mr. Gromyko is it a fact that he raised the question of the diabolical cruelty being perpetrated by the U.S.S.R. against captive peoples in the Ukraine and also in the Baltic States. When he raised the question in general terms did Mr. Gromyko say to him, "Now, what is your next question".
Hon. Donald C. Jamieson (Secretary of State for External
Affairs): Mr. Speaker, I am sure the right hon. member would not expect me to reveal precisely the nature of these conversations. Perhaps I should answer him by saying, "What is your next question", but I will not do that.
I did not bring up, in reference to the first part of the Right Hon. member's question, the specific matter of the Ukraine, etc. I did talk about this matter in terms of the follow on to the Helinski Declaration and expressed the view that we hope these matters can be discussed thoroughly at the conference in Belgrade which is to take place in 1977. I do not think I left any doubt in the foreign minister's mind as to what the Canadian government's position is. On the precise aspect of the question, namely the reunification of families, I can assure the Right Hon. member and the House that I made the strongest possible representations in this connection to the best of my knowledge and capability in the language. I do not think I left any doubts as to our view that unification should take place and that it was deeply regrettable that the Soviet Union was not prepared to move, as we asked them to do repeatedly on this question. While not quoting exactly the response of the Soviet foreign minister, I can say that it came reasonably close to what was described by the Right Hon. member.


SOVIET UNION-DISCUSSION BETWEEN MINISTER AND MR. GROMYKO CONCERNING RELIGIOUS FREEDOM
John George Diefenbaker: I am glad to have that admission because it was widely rumoured around the world that Canada was simply shoved aside in the face of responsible questions and stands taken by the minister. Did the

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minister bring out with the representative of the U.S.S.R. the fact that in the Baltic states a policy is now being followed by the U.S.S.R. of destroying Christian churches, demolishing them and refusing permission to the people of those countries to have their own churches and to worship their God as they will?


Donald Campbell Jamieson: Mr. Speaker, I did not, I repeat, bring up these matters in precisely those terms. 1 am sure that the Right Hon. member will understand that 1 was not privy to his vernacular on the occasion. But I repeat that I have no problem in saying that I re-emphasize now our insistence that the meetings in Belgrade following the Helinski conference embrace all of these matters regarding both human rights and a greater and more free exchange of people, their objectives and their right to carry out their own lifestyle and their own wishes.


POSSIBILITY OF TREATY ENABLING CANADIAN PRISONERS IN MEXICO TO BE REPATRIATED TO SERVE SENTENCES IN CANADA
Hon. Robert Stanbury (York-Scarborough):: Mr. Speaker, I have a question for the Secretary of State for External Affairs. Is the government considering or will it consider negotiating, as, I understand, the United States is with the government of Mexico, a treaty which would have as its purpose the voluntary repatriation of prisoners from the jails of one country back to their own country to serve any sentence?


Donald Campbell Jamieson: Mr. Speaker, since coming to the House today I have been advised of a report that the United States-and, I believe, it was also suggested that Canada-was engaged in this kind of negotiation with Mexico. Personally, I am not aware of it. The principle sounds one that we could accept. We will make further inquiries and advise the hon. member in the House.


TRANSPORT
Mr. Les Benjamin (Regina-Lake Centre):: Mr. Speaker, I should like to direct a question to the Minister of Transport who is also in charge of the Canadian Wheat Board. In view of the fact that as of last weekend there was a shortage of some 4,800 box cars for grain movement in the Prairie provinces, 3,100 of them on CP tracks and most of them in Alberta, 900 short in Saskatchewan on CP tracks, and many country elevators congested, is the minister aware of this matter? Has he taken it up with the railways, and what action are they taking to increase the supply of cars for grain movement?


Hon. Otto E. Lang (Minister of Transport):: Mr. Speaker, in the report I had the falling behind of loading, which is temporary and not at all serious in the over-all program, the
(Mr. Diefcnbaker ]

indication was that particular track and bridge problems were the cause. Therefore, the situation can be remedied as soon as those problems are corrected.


Leslie Gordon Benjamin: As a consequence of this matter, since there are four ships loading in Vancouver, eight to arrive by the end of this week and six more the following week and not sufficient cars on hand-Thunder Bay does not have a sufficient number of cars on hand to warrant unloadings on the weekends and nothing is happening at Prince Rupert-in fact, there is available space for over 1 million bushels in Prince Rupert and no cars en route-can the minister tell the House whether or not he has requested the railways to arrange an increased supply of box cars and hopper cars for grain movement, supplied at the taxpayers expense, in order to meet what will likely be a difficult situation for grain loadings at those terminals?


Otto Emil Lang: Mr. Speaker, the hon. member obviously missed the point of the earlier answer. It is not a question of the shortage of cars; it is a question of the speed with which they are turned around, given the track and bridge condition.


An hon. Member:: What tracks, what bridges?


Otto Emil Lang: While the hon. member for Calgary North does not seem to know it, if bridges are out, cars do not move very quickly across them, and obviously they have a problem. I indicated that this matter is of concern, but essentially it is in hand. There is a high volume of stocks in Vancouver and, as the hon. member may know, there have been very few ships waiting for the last eight or ten months. As a result, we have not heard from him on the subject. With these developments, we are glad to hear from him again.


Leslie Gordon Benjamin: Mr. Speaker, the minister said there are some bridges out, but he did not say where the cars are. The bridges are not out on all lines. I would like to ask the minister what provisions have been made. There are adequate stocks in Vancouver for loading the ships arriving in the coming week, but there are not adequate stocks for six more ships arriving in the following week. What action is he taking to see that there are sufficient carloads of grain arriving to allow elevator terminals to put on ships on the weekend. Only three terminals will be working this weekend in Thunder Bay, for example, and nothing is happening in Prince Rupert. All the grain companies are complaining that they do not have enough cars on hand.


Otto Emil Lang: I can assure the hon. member that I have full confidence in the ability of the Canadian Wheat Board to handle the situation. I know that they are fully on top of the situation and will overcome the current temporary difficulties as they did when a much more serious problem arose with a bridge in New Westminster. If the Canadian Wheat Board feel they need my assistance, they will let me know it. They have not done so until this time, so I ask the hon. member to share my confidence in the Canadian Wheat Board.


GOVERNMENT POSITION ON NOVA SCOTIA'S PROPOSAL FOR AID WITH COST OF ELECTRICITY
Hon. Robert L. Stanfield (Halifax):: Mr. Speaker, I should like to direct a question to the Minister of Energy, Mines and Resources with respect to his policy toward the Atlantic provinces, not long-term solutions but rather whether he really intends to take any action with respect to the immediate problem facing the people there of a 65 per cent increase in rates. Is he deliberately pursuing a secretive and conspiratorial attitude toward this subject, or he is now prepared to tell me and the members of the House whether the government will come up with a decision with respect to the equally highly secret and conspiratorial proposition put before the minister and the government by the government of Nova Scotia?


Alastair William Gillespie: Mr. Speaker, 1 indicated the other day that we hope to make a decision before the end of the year. May I go on to say that there is nothing secret or conspiratorial about this matter, unless it be on your side of the House.


Some hon. Members:: Order.


Alastair William Gillespie: It is not at all clear to me where your leader stands on oil prices. 1 believe he would have been for higher prices. I can understand your anxieties in this respect-


Some hon. Members:: Oh, oh!


Robert Lorne Stanfield: I would like to ask the minister a very simple question. 1 would like to believe he is an honest man.


Some hon. Members:: Oh, oh!


An hon. Member:: Certainly he is simple.


Robert Lorne Stanfield: If there is nothing secret or conspiratorial about the proposal put forward by the government of Nova Scotia, which the minister insists that he and the government of Canada are considering and which, frankly, I do not believe they are seriously considering, why will the minister not say what it is that the government is pretending to consider?


Some hon. Members:: Hear, hear!


Alastair William Gillespie: I have said repeatedly that we are quite prepared to make it public if the premier of Nova Scotia agrees. It was his document. It was his proposal made to us. I ask the hon. member to be open and to reveal his secret conspiratorial position with respect to prices.


Some hon. Members:: Oh, oh!


Mr. Baker (Grenville-Carleton):: You arc a wind tunnel.


Robert Lorne Stanfield: I think we can all agree now that the suggestion I made about conspiracy and secretiveness was fully justified.
Ora! Questions


Some hon. Members:: Hear, hear!


Robert Lorne Stanfield: I would like to ask the minister whether he is prepared to use the last opportunity he has to be credible on this subject in the Atlantic provinces and in Canada by coming clean and dealing openly and honestly with this proposition.


Alastair William Gillespie: I put it to the hon. member that the letter was written to the government in confidence, and before the government releases that document, it should get the agreement of the person who wrote it. That is the position the government has taken. We have not been able to secure his agreement.


RESEARCH ON ALTERNATIVE SOURCES-GOVERNMENT ACTION
Mr. F. Oberle (Prince George-Peace River):: Mr. Speaker, my question is also to the Minister of Energy, Mines and Resources. It is now apparent that the government is not intending to implement the recommendations of its own task force of last year, nor does it have any intention of following up the commitment made in the throne speech to channel more money into research and development of exotic energy sources. Can the minister tell the House whether this government has any intention of going into partnership with the provinces and bringing on stream conversion plants for biomass and industrial wastes, things for which technology is already known, but for which some stimulation from the federal government is needed?


Alastair William Gillespie: Mr. Speaker, we are already involved in a number of shared-cost programs with the provinces, and it is quite incorrect for the hon. member to state that we are not interested in increasing our energy research and development expenditures. We have made it quite clear-and I think I have made it quite clear in answer to the first and second questions today- that we would be doing so.


Frank Oberle: Could the minister tell us how much money is in the budget this year for research and development? The information we have indicates that the government is not spending any money at all in this field, except for a few minor demonstration projects.


Mr. Speaker:: Order, please. That question might properly be asked in some other way. The hon. member for South Western Nova.


FISHERIES
Miss Coline Campbell (South Western Nova):: Mr. Speaker, my question is to the Minister of Fisheries and the Environment. In view of the minister's statement yesterday that at present he is considering fish plans for 1977, and in view of his


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action in the gulf, will he now consider establishing perhaps a 50-mile limit off the coast of Nova Scotia in which only boats under 100 feet could fish, since boats over 100 feet will be able to go further once we have established the 200-mile limit?


Hon. Romeo LeBlanc (Minister of State (Fisheries) and the Environment):: Mr. Speaker, 1 do not fully agree with the hon. member's association of the decision to remove large vessels from the gulf with the proposal she is making. This proposal has been made by some fishermen's organizations. The implications of it are really quite serious, and I would be very hesitant to substitute disagreements between the provinces and groups of fishermen for those we have started to sort out with the international community.


HARBOURS
Mr.  R. Gordon L. Fairweather@Fundy-Royal: Mr. Speaker, I have a question for the Minister of Transport. Has Michael Woodall been hired, effective November 1, to implement the new ports policy?


Otto Emil Lang: Mr. Speaker, 1 am not familiar with any such development. There were certain other people involved in the implementation of the ports policy the last time I looked, but I will check for the hon. member.


Mr. Fairweather:: Under what legislation have the various port authority chairmen been delegated authority by the National Harbours Board effective January 1, 1977? The minister will recall that such a delegation was ruled out by his ministry about two years ago.


Otto Emil Lang: Certain delegation of authority has taken place with regard to a number of ports in Canada over the last couple of years, notably Vancouver and Montreal, and this pattern with the same authority is being employed in other ports.


FISHERIES
Mr. Donald W. Munro (Esquimalt-Saanich):: 
AGRICULTURE
Mr. Arnold Malone (Battle River):: Mr. Speaker, my question is for the Minister of Agriculture. Does the minister have a contingency plan for the restriction of imports of offshore beef and veal for the period beyond January 1, 1977, and if so, what is the nature and duration of this plan?


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker,
I do not know if I would call it a contingency plan at all because it depends on negotiations between Australia and New Zealand and Canada and the United States, and it also depends on what the United States might do. However, we are prepared to act with a program of our own in case they may do one of many different things.


Arnold John Malone: In order that there might be some security put back into the beef market in Canada, I wonder if the minister can tell us if he has any plan to stabilize the market system of this country, and by that I do not mean supply-management.


Eugene Whelan: To put beef marketing into its proper perspective there has to be some supply-management, no matter whether it happens to be a Whelan plan or a President Ford plan or anything else.


An hon. Member:: You are both going the same way.


EXTERNAL AFFAIRS
Arthur Jacob (Jake) Epp: Mr. Speaker, I would like to direct my question to the Secretary of State for External Affairs, following my motion under Standing Order 43 today and the questions of the right hon. member for Prince Albert. I would like to ask the minister whether any specific representations were made by him or any other Canadian government officials during the visit to the U.S.S.R. that prisoners of conscience, especially prisoners such as Georgi Vins, about whom the minister received numerous representations might be released and allowed to practice their faith in freedom?


Donald Campbell Jamieson: Mr. Speaker, I would have to check precisely on the name the hon. member gave in order to know whether that name was included on a list. However, I can tell the hon. member that following my meetings in the Soviet Union the Canadian ambassador in Moscow was instructed by me to convey to Soviet officials specific representations, some of which had been received by me while I was in the Soviet Union and others which had come prior to my departure. I think I am safe in assuring the hon. member that if there were individual representations, these have been conveyed to officials of the Soviet government by now.


CANADIAN BROADCASTING CORPORATION
Mr. J. R. Holmes (Lambton-Kent):: Mr. Speaker, my question is for the Secretary of State, and it relates to a documentary on French culture in the village of Paincourt, which appeared on CBET Windsor, channel 9 during the early part of the evening on Monday, October 26. The major part of that documentary involved the showing of a hotel and a nude stripper.


Some hon. Members:: Oh, oh!


John Robert Holmes: Mr. Speaker, as a member of the village and resident of that particular township familiar with the culture and traditions of the village, I ask the minister if he will make a thorough investigation of that obviously unbalanced program which was an insult. Sir, to all the residents of that area. Will he insist upon a public apology being made to the citizens of Paincourt and the residents of the township.


Hon. John Roberts (Secretary of State):: Mr. Speaker, I congratulate the hon. member on living in such a splendid community. I regret to say that I was unaware of the documentary and thus did not have a chance to see it, but I shall be pleased to look into the matter with extremely perceptive attention.


GOVERNMENT ADMINISTRATION
Mr. Robert Muir (Cape Breton-The Sydneys):: Mr. Speaker, my question to the Acting Prime Minister concerns representations I made over a long period to the Minister of Industry, Trade and Commerce, when he was President of the Treasury Board, the Minister of Supply and Services and the previous Minister of National Revenue, in the form of letters, questions in the House and personal conversations with regard
Oral Questions
to decentralization. Is the Acting Prime Minister now in the position or will he be in the position shortly to announce what department of government will be transferred to Cape Breton Island, an area of chronic unemployment where, unfortunately, as the minister knows, the present unemployment rate is running at between 25 per cent and 30 per cent? May I ask the minister if he is still sending diplomatic notes to his colleague, the Minister of Industry, Trade and Commerce, on this subject?


Hon. Jean Chretien (Minister of Industry, Trade and Commerce):: Mr. Speaker, now he is in the position to send direct notes.


Mr. Clark:: But does he read them?


POSSIBILITY DEPARTMENT OF FISHERIES TRANSFERRED TO CAPE BRETON
Robert Muir: Mr. Speaker, I am surprised at the Acting Prime Minister's not being more interested. May I direct a supplementary question to the Minister of Fisheries and ask him if negotiations are going on at the moment, as was suggested yesterday or the day before by the Premier of Nova Scotia, for the possible transfer of the Department of Fisheries to Sydney, Cape Breton Island?


Roméo LeBlanc: Mr. Speaker, I have no quarrel at all with the choice of the site. As to the suggestion, I must confess it is a surprise to me.


THE MINISTRY
Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, I have been attempting to ask a question of our newest cabinet minister since his swearing in yesterday morning, but have not seen him in his seat for more than a couple of minutes. Mr. Speaker, my question is directed to the newly appointed Minister without Portfolio, the hon. member for St. Boniface.


Some hon. Members:: Hear, hear!


John Allen Fraser: You'll have to say more than no, Joe.


Allan Frederick Lawrence: I ask the minister, what special, extra responsibilities has he been given by the Prime Minister which would justify the extra burden his elevation to the cabinet imposes on the taxpayers of this country?


Hon. Joseph-Philippe Guay (Minister without Portfolio):: Mr. Speaker-


Some hon. Members:: Hear, hear!


John Allen Fraser: Say no, Joe.


Oral Questions


Robert Gordon Lee Fairweather: Speak up, Joe.


Joseph-Phillippe Guay: I should like to give the hon. member an appropriate answer by telling him, first, that one of my responsibilities will be to represent the people of Manitoba to the best of my ability.


Some hon. Members:: Hear, hear!


Joseph-Phillippe Guay: I look forward to doing that. In a lighter vein, I can tell the hon. member that I often have secret meetings with the chief Whip of the opposition. That is a military secret, and I will not tell him anything more about it.


Some hon. Members:: Hear, hear!


VETERANS AFFAIRS
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the Minister of Veterans Affairs? Since Remembrance Day is only a week away, will the minister consider, in honour of that day, the introduction of legislation to provide prorata pensions for widows of veterans where the veteran's pension was less than 48 per cent?


Hon. Daniel J. MacDonald (Minister of Veterans Affairs):: Mr. Speaker, it is under consideration by the government, as is other legislation.


Stanley Howard Knowles: A supplementary question, Mr. Speaker. Will the minister do his best to persuade the government to permit him to make a statement of policy on this matter before Remembrance Day?


Daniel Joseph MacDonald: Mr. Speaker, 1 will take that under consideration.


CANADIAN INTERNATIONAL DEVELOPMENT AGENCY
Charles Joseph Clark: Mr. Speaker, my question is directed to the Acting Prime Minister. The other day, as reported in Hansard, in the absence of the Acting Prime Minister and of the Secretary of State for External Affairs the Prime Minister indicated that the location of the responsibility for Cl DA was a matter for discussion between the Acting Prime Minister in his capacity as House leader and the Secretary of State for External Affairs. I wonder if the Acting Prime Minister can advise the House-


Some hon. Members:: Oh, oh!


Charles Joseph Clark: Mr. Speaker, I do not think the interjections from the other side will last long enough to get the minister beyond the question period. I ask the Acting Prime Minister whether he is now in a position to report upon the conclusion of the discussion between himself and the Secretary of State for External Affairs and whether he can tell us which minister will continue to be responsible for CIDA in this House. If the minister cannot tell us, perhaps he would like us to consult with the Clerk of the Privy Council.


Some hon. Members:: Oh, oh!


Allan Joseph MacEachen: Mr. Speaker, in reply to the question of the Leader of the Opposition, the situation has not changed since the question was answered by myself last week and on Monday of this week by the Prime Minister. The situation is as described by both of us. The Secretary of State for External Affairs and I have not had the chance to resume our discussions since his arrival back from his very successful trip to Europe.


Charles Joseph Clark: A supplementary question, Mr. Speaker. Can the Acting Prime Minister tell the House when he expects to be on speaking terms again with his colleague, the Secretary of State for External Affairs-


An hon. Member:: Cheap shot!


Some hon. Members:: Oh, oh!


Charles Joseph Clark: -and when the House and country may tell which minister is going to be responsible for reporting in this House on CIDA?


Allan Joseph MacEachen: Mr. Speaker, I am sorry; I did not hear the question of the Leader of the Opposition.


Some hon. Members:: Oh, oh!


An hon. Member:: Ask Schumacher.


Charles Joseph Clark: I apologize to the government House leader for the conduct of his caucus.


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. The difficulty is that I was unable, as well, to hear the Leader of the Opposition. Perhaps he would ask his question.


Charles Joseph Clark: Mr. Speaker, I would hope that the government House leader will be able to get his caucus under control fairly
soon.


Some hon. Members:: Oh, oh!


Charles Joseph Clark: May I ask when the Acting Prime Minister expects the House and country to be advised on who is going to be responsible for reporting to parliament on the activities of CIDA?


Allan Joseph MacEachen: Mr. Speaker, the Secretary of State for External Affairs is responsible for reporting to the House on C1DA. If and when that situation changes, the House will be notified.


Some hon. Members:: Hear, hear!



ROUTINE PROCEEDINGS


Walter David Baker: Mr. Speaker, I rise on a point of order. In prefacing my usual business question today, I wish to say that the official opposition is delighted with the announcement that the Acting Prime Minister made today with regard to the introduction of the Independence of Parliament Act, particularly in view of the fact that government members rejected a motion which would have allowed a study of this subject earlier in the week, the motion having been made by a member of the official opposition.
Dealing with the matter of the legislative program, I ask the House leader to inform the House of the business that he contemplates for the balance of this week and perhaps next week. Is the House leader prepared to make a statement today with regard to the arrangements concerning Remembrance Day, and with respect to Friday, November 12? There have been some discussions on that. In addition, will he designate on the order paper the opposition days which he and I have discussed and which I understand are in order, subject to certain caveats which he wishes to make.


Allan Joseph MacEachen: Mr. Speaker, I will be able to deal with all the points raised by the hon. member. On the first question with regard to the regular business of the House, we will continue with the borrowers and depositors act. If it is necessary to complete the business of a particular day, we will call the Currency and Exchange Act and the Canada Land Surveys Act. However, at the beginning of the next full day I will call the government expenditure restraint bill. On Tuesday next it is my intention to have an allotted day. For planning purposes, I wish to indicate to the House that the following are proposed as allotted days in addition to November 9: November 18, November 26, December 1 and December 9.
With regard to the sittings of the House next week, as hon. members know, Thursday of next week is Remembrance Day and is, accordingly, a day when members are in their constituencies. In order to make the proper arrangements for next week, it is my proposal that we not sit on the Friday following Remembrance Day and, in order to pick up some time, that we sit for an extra two hours on Tuesday, November 16. If these
Business of the House
arrangements are agreeable to hon. members I am ready to propose a motion that will put them into effect. I shall read the motion and then ask for consent. I propose to move:
That when the House adjourns on November 10, 1976, it shall stand adjourned to November 15, 1976; and that the House shall sit from 11 a.m. to 1 p.m. on November 16, 1976, for the purpose of considering government business.
If I have consent, I will move that motion.


Mr. Speaker:: The President of the Privy Council seeks the consent of the House to put the motion at the present time. Does he have unanimous consent?


Some hon. Members:: Agreed.


Mr. Speaker:: Mr. MacEachen, seconded by Mr. Macdonald (Rosedale), moves:
That when the House adjourns on November 10, 1976, it shall stand adjourned to November 15, 1976; and that the House shall sit from 11 a.m. to 1 p.m. on November 16, 1976, for the purpose of considering government business.
Is it the pleasure of the House to adopt the said motion?


[Stage Direction]
Motion agreed to.
Stanley Howard Knowles: Mr. Speaker, I rise on the same point of order. While we are discussing future business of the House, may I ask the House leader how soon we may expect the reintroduction of the human rights bill which was before us but not considered in the last session. Can he say when that bill will be introduced, and whether the provisions in it to provide equality between men and women will be improved?


Allan Joseph MacEachen: Mr. Speaker, I certainly hope to have first reading of that bill within the next week or two. I cannot give the hon. member specific information about the various provisions of the bill, but I believe he will find it an improved bill over the bill of last session.


Mr. Marshall:: Mr. Speaker, can the House leader advise when we will have the introduction and second reading of Bill C-ll, to amend the Pension Act? It is a very simple bill to create a deputy minister of the Pension Review Board.


Allan Joseph MacEachen: Mr. Speaker, I am ready to call that bill at any moment if we can get agreement on how to deal with it. We could interrupt the normal business which I have announced, at a particular time-after consultation with the Minister of Veterans Affairs (Mr. MacDonald)-to give it second reading.


Walter David Baker: Mr. Speaker, the minister did not mention the harbours and ports legislation among the list of priorities. Is he contemplating early action with regard to that? It is important in terms of arrangements that I must make.


Allan Joseph MacEachen: Yes, Mr. Speaker. If, for example, we succeed in concluding the bill presently before the House, the borrowers and depositors act, we could then proceed to the currency exchange, fishing and recreational harbours and land surveys bills. However, as I indicated, if we are beginning a

Criminal Law Amendment
full day with a new item tomorrow, the new item I would call would be the expenditure restraint bill.
[ Translation]


Mr. Speaker:: The hon. member for Richmond (Mr. Beaudoin) on a point of order.


Mr. Beaudoin:: Mr. Speaker, could the government leader tell the House when he is going to introduce a bill on the tax exemption under registered retirement savings plans, allowing a private company owner to claim a $3,500 deduction instead of $2,500.


Allan Joseph MacEachen: Mr. Speaker, we will be proceeding with the income tax bill flowing from the budget. However, I am not contemplating any new budgetary provisions beyond those that were announced by the Minister of Finance. It appears that the proposal put forward by the hon. member is a matter for announcement in the budget.


REGULATIONS AND OTHER STATUTORY INSTRUMENTS
[Stage Direction]
First report of the Standing Joint Committee on Regulations and Other Statutory Instruments-(Mr. McCleave).
[Editor's Note: For text of above report, see today's Votes and Proceedings.]

Mr. John Reynolds (Burnaby-Richmond-Delta) moved: for leave to introduce Bill C-377, to provide for a national plebiscite on the abolition of capital punishment.
He said: Mr. Speaker, the purpose of this bill is to give the people of Canada the chance to make their views known with regard to a decision taken in this House which was unacceptable to a majority of Canadians.


[Stage Direction]
Motion agreed to, bill read the first time and ordered to be printed.

John Douglas Reynolds: for leave to introduce Bill C-378, to amend the Criminal Code in relation to the reinstatement of capital punishment.


[Stage Direction]
Motion agreed to, bill read the first time and ordered to be printed.

Arthur Ronald Huntington: Mr. Speaker, pursuant to the provisions of Standing Order 67, I hereby present a petition relating to the circumstances surrounding and leading to the terms and conditions of the Terrasses de la Chaudiere project in the national capital region. The petitioners pray that this honourable House inquire into such matters and provide such remedy as this honourable House may determine.


Some hon. Members:: Hear, hear!


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Ralph E. Goodale (Parliamentary Secretary to President of the Privy Council):: Mr. Speaker, the following questions will be answered today: 38, 50, 115, 176, 370, 580, 611, 683, 712 and 813.


Mr. Cossitt: 1.	With reference to the answer to Question No. 5,339 of the First Session of the 30th Parliament, which stated in part that the Prime Minister travelled to and from Jamaica on his 1976 Easter vacation by commercial aircraft, does this represent a change in the previous policy of the Prime Minister to use government owned aircraft for pleasure and political trips and, if so (a) what are the reasons for this change (b) on what date was it decided (c) will the Prime Minister continue to use commercial aircraft for pleasure and political trips?
2.	Were air fares of persons accompanying the Prime Minister paid for by the taxpayer and, if so, what are their names and job designations?
3.	Did any person including the Prime Minister travel to and from Jamaica using a free pass on the Air Canada flight involved and, if so, what is the name and job designation of each person who was provided with free transportation?
4.	Did a member of the RCMP or any other government employee accompany the Prime Minister and, if so, what are their names and job designations and who paid their air fare?


Right Hon. P. E. Trudeau (Prime Minister):: 1. See line 44, part 4 of reply to Question 69, Hansard 237, page 10581, dated February 3, 1976.
2.	See reply to Question 5339, Hansard 294, page 13153, dated May 4, 1976.
3.	The Prime Minister and family (see replies to Questions 2315, Hansard 157, page 6918 of June 19, 1975 and 2315 (Supplementary), Hansard 174, page 7718 of July 18, 1975.
4.	A member of the RCMP-fare paid by the RCMP (see lines 21 to 24, part 4 of reply to Question 69).


Mr. Cossitt: 1.	On or about August 21 and 22, 1976, was there a second oil spill in the St. Lawrence River, west of Brockville, Ontario and, if so (a) what are the results of any investigations made by the Department of Transport (b) what is the identity of the vessel (c) what steps have or will be taken to deal with the owner of the vessel (d) what has been or what is the total estimated cost for cleaning up the spill by the Department of Transport?
2.	(a) What is the maximum penalty applicable for convictions of an offence of this kind (b) is the government giving consideration to raising the penalty and, if so, what penalty is being considered and on what date will action be taken?


Mr. Marcel Roy (Parliamentary Secretary to Minister of Transport):: 1. Yes (a) The United States Coast Guard conducted the investigation but could not identify the ship, (b) unknown; (c) the owner cannot be identified, (d) $32,500.
2.	(a) $100,000, (b) The government is not giving consideration to raising the penalty.


Mr. Forrestall: 1.	With reference to the answer to Question No. 5,503 of the First Session of the 30th Parliament, is there an allocation of cost for the takeover of quays and back-up land (excluding sheds) in the cost estimates for Jacques Cartier Terminal and, if not, for what reason?
2.	(a) What is the government's best estimate of the value of quays and back-up area (excluding sheds) incorporated in Jacques Cartier Terminal (b) how do these estimates compare with those for Rodney Terminal at St. John, N.B. (c) was the cost of existing quays and back-up area included in the St. John estimates?


Marcel-Claude Roy: The National Harbours Board advises as follows; 1. Cost estimates for budget purposes included direct construction costs only. Project costs included an allocation of cost for the takeover of quays and back-up land.
2. (a) Estimated value of pre-existing quays is $1,077,371. (b) The net book value of quays which were destroyed to permit construction of Rodney Terminal was $2.3 million. The estimated value of existing land and waterlot incorporated in the terminal was $3.1 million, (c) No, only construction costs were included in cost estimates used for budget purposes.


Mr. Reynolds: 1.	Who comprises the Selection Committee for the Art Bank that is sponsored by the Canada Council?
2.	Is there any other government agency that purchases art for the government and, if so, what is the name of the committee or committees and who serves on them?


John (Moody) Roberts: 1 am informed by the Canada Council as follows: 1. Since its inception, 144 persons, chosen mainly among artists but also including curators and critics have served on selection committees of the Art Bank and the list for 1975-76 was as follows: Kim Andrews (Toronto); Ted Bieler (Toronto); Zbigniew Blazege (Toronto);
Order Paper Questions
Ronald Bloore (Toronto, Ottawa, Oakville, Brampton, Claremont); George Bogardi (Ottawa); Daid Bolduc (Vancouver, Victoria, Ottawa); Jim Borcoman (Ottawa); Robert Bourdeau (Ottawa); John Boyle (Ottawa, Guelph, Georgetown, Stratford, Hamilton); Janice Campbell (Toronto); Robin Collyer (Toronto); Ulysse Comtois (Montreal); Greg Curnoe (Ottawa); Ihor Dmytruk (Edmonton); Paterson Ewen (Ottawa); Bill Ewing (Montreal, Ottawa); Joe Fafard (Ottawa); Bruce Ferguson (Ottawa); Brian Fisher (Ottawa); Robert Frank (Ottawa); Vera Frenkel (Toronto); Charles Gagnon (Montreal, Ottawa, Peterborough, Kingston, Tam-worth, Havelock, Glenburnie); Yves Gaucher (Montreal, Quebec); Pierre Gaudard (Ottawa, Montreal); Tom Gibson (Ottawa); Ted Godwin (Ottawa); John Greer (St-Jean, Sack-ville, Halifax, Charlottetown, Moncton, Saint-Jean, Fredericton); Donald Harvey (Victoria); Dave Heath (Ottawa); Terence Heath (Saskatoon); Jules Heller (Toronto); Jacques Hurtubise (Montreal); Gershon Iskowitz (Toronto); William Kirby (Winnipeg); Nobuo Kubota (Toronto); Ken Lochhead (Ottawa); Joan Lowndes (Vancouver, Victoria); Robin Mackenzie (Toronto); Jean McEwen (Montreal, Ottawa, St-Jean, Halifax, Sackville, Charlottetown, Moncton, Saint-Jean, Fredericton); Guido Molinari (Ottawa); Ron Moppett (Calgary); Michael Morris (Ottawa); Doug Morton (Toronto); Ken Morton (Vancouver); Robert Murray (New York); Ronald Nasgaard (Toronto); Jean Noel (Montreal); Bruce O'Neil (Banff); Chantal Pombriand (Montreal); David Rabinowitch (New York); Royden Rabinowitch (Ottawa); Pnina Rajinsky (Ottawa); Gordon Rayner (Toronto, London, St. Catharines, West Lome, St. Thomas, New York); Don Reichert (Winnipeg, Toronto, Oakville, Brampton, Claremont); Suzanne Rivard-Lemoyne (Ottawa); Henry Saxe (London, St. Catharines, West Lome, St. Thomas, Guelph, Georgetown, Stratford, Hamilton); Michael Schreier (Ottawa); Jack (Shadbolt (Vancouver)); Vincent Sharp (Ottawa); Gordon Smith (Ottawa, Vancouver); Gabor Szilazi (Ottawa); Takao Tanabe (Calgary); Sam Tata (Montreal); Eugene Tellez (Toronto); Normand Theriault (Montreal); Gilles Toupin (Ottawa, Montreal); Claude Tousignant (Montreal, Winnipeg, Saskatoon, Edmonton, Calgary, Banff); Serge Tousignant (Ottawa); Tony Urquhart (Ottawa); Roger Vilder (Montreal, Kingston, Peterborough, Tamworth, Havelock, Glenburnie, Ottawa); Irene Whittome (Montreal, Quebec, Ottawa); Shirley Wiitasalo (Toronto); Karen Wilkin (Edmonton); Dennis Young (Ottawa).
I am informed by the National Museums of Canada as follows: 2. The National Museums of Canada purchases art for the national collections of the Corporation. Acquisitions are made on the recommendation of the Director of the appropriate museum for the approval by the Board of Trustees of the Corporation and in special circumstances of the Minister and Treasury Board.


Order Paper Questions


Mr. Munro (Esquimalt-Saanich): 1.	(a) How many regional offices are maintained by the Ministry of Science and Technology (b) where is each located (c) for what area is each responsible?
2.	On what date was each established and with how many personnel?
3.	What is the present personnel strength of each office?
4.	In addition to regional offices, are district or other sub-offices maintained and, if so (a) in what locations (b) how many?
5.	Are the duties performed by those manning the regional and/or district offices line functions, in the chain of command from Ottawa to the operator in the field, or do they have other functions to perform and, if so, what are such functions?


Hon. James Hugh Faulkner (Minister of State for Science and Technology):: In so far as the Ministry of State for Science and Technology is concerned: Nil return.


Mr. McKinnon: What was the standing of the Canadian Forces Superannuation Account on (a) October 1, 1975 (b) October 1, 1976?


Hon. Barney Danson (Minister of National Defence):: (a)
and (b) The standing of the Canadian Forces Superannuation Account on October 1, 1975 and on October 1, 1976 follows:
Standing of the Canadian Forces Superannuation Account
	October 1, 1975	October 1, 1976
Current contributions Arrears of contributions Transfer from other funds Interest Government contributions Unclaimed accounts Undelivered cheques Repayments of annuity (Bill C-52)	781,620,196.69 48,237,174.76 9,501,653.28 1,026,676,988.18 1,412,648,692.70 457,234.92 147,394.33	835,395,102.26 49,393,988.50 10,988,738.63 1,113,678,502.86 1,512,995,374.42 467,751.64 151,513.72 287,514.88Sub Total	3,279,289,334.86	3,523,358,576.91Less:	Payments of Annuities and Annual Allowances Payments of Cash Termination Allowances and Returns of contributions Payments of Interest on Returns of Contributions Transfers to other Pension Funds Payments of Estate Tax and Succession Duties Sub Total Total	960,227,179.86 174,758,018.88 3,699,394.89 6,708.87 1,138,691,302.50 2,140,598,032.36	1,118,935,109.51 180,391,466.40 137,434.77 4,842,576.99 6,708.87 1,304,313,296.54 2,219,045,280.37Actuarial Account	Actuarial Liability Contributions Interest to date Total	3,296,919,000.00 889,207,115.63 4,186,126,115.63	3,310,399,000.00 1.059.180.622.29 4.369.579.622.29Grand Total	6,326,724,147.99	6,588,624,902.66


Mr. Marshall: 1.	Were applications received from Newfoundland under Parks Canada $4,000 Scholarships Programme to assist graduate students in the pursuit of studies related to the conservation, management and interpretation of the natural and historic resources of Canada?
2.	Were applications received from Newfoundland under the Scholarship Programme for undergraduates of Indian and Inuit origin to increase the opportunities for employment of native people in areas of environmental and historical conservation and interpretation, outdoor recreation and the natural sciences?


Mr. B. Keith Penner (Parliamentary Secretary to Minister of Indian Affairs and Northern Development):: 1. No applications were received from Newfoundland under the Parks Canada Graduate Scholarships Program for 1976-77.
2. No applications were received from Newfoundland under the Parks Canada undergraduate Scholarship Program 197677 for registered Indians and inuit. This was searched both by province of permanent residence and by university attended.


Mr. Knowles (Winnipeg North Centre): What are the names of the (a) acting ministers (b) second acting ministers of each department of the government?


Ralph Goodale: P.C. 1976-2303. Certified to be a true copy of a Minute of a Meeting of the Committee of the Privy Council, approved by His Excellency the Governor General on the September 20, 1976. The Committee of the Privy Council, on the recommendation of the Prime Minister, advise: 1. That in the absence from Ottawa of the Prime Minister or in the event of his being unable to perform the functions of his Office, the next Senior Minister who is in Ottawa, and is able to perform the functions of the Office of Prime Minister, be authorized to act for the Prime Minister;
2.	That in the absence from Ottawa of a Minister whose name is set out in Column II of an item of the Schedule to this Minute, or in the event of that Minister being unable to perform the functions of his Office, the Minister whose name is set out in Column III of the item be authorized to act for the Minister named in Column II in respect of the Office set out in Column I of the item;
3.	That in the absence from Ottawa of the Ministers named in Columns II and III of an item of the Schedule to this Minute, or in the event of both of those Ministers being unable to perform the functions of their Office, the Minister whose name is set out in Column IV of the item be authorized to act for the Minister named in Column II in respect of the Office set out in Column I of the item;
4.	That in the absence from Ottawa of the Ministers named in Columns II, III and IV of an item of the Schedule to this Minute, or in the event of all those Ministers being unable to perform the functions of their Office, the Prime Minister or, if the Prime Minister is absent from Ottawa or unable to per-



form the functions of his Office, the next Senior Minister who is in Ottawa be authorized to act for the Minister named in Column II in respect of the Office set out in Column I of the item;
5.	That where an Office set out in Column I of an item of the Schedule to this Minute is vacant, the Minister whose name is set out in Column III of that item be authorized to act in the Office of the Minister whose Office is set out in Column I of that item; and
Order Paper Questions
6.	That where an Office set out in Column I of an item of the Schedule to this Minute is vacant, in the absence from Ottawa of the Minister whose name is set out in Column III of that item, or in the event of that Minister being unable to perform the functions of the Office set out in Column I of that item, the Minister whose name is set out in Column IV of that item be authorized to act in the Office of the Minister whose Office is set out in Column I of that item.


[Stage Direction]
Column I	Column II	List of Acting Ministers Column III	Column IVOffice	Name	Acting Minister	Second acting1.	Agriculture	Mr. E. F. Whelan	Mr. D. J. MacDonald	Minister Mr. O. E. Lang2.	Communications	Mrs. J. Sauve	Mr. A. W. Gillespie	Mr. J. H Faulkner3.	Consumer and	Mr. A. C. Abbott	Mr. M. Lalonde	Miss M. Begin4.	Corporate Affairs Energy, Mines	Mr. A. W. Gillespie	Mr. D. S. Macdonald	Mr. D. C. Jamieson5.	and Resources External Affairs	Mr. D. C. Jamieson	Mr. A. J. MacEachen	Mr. D.S. Macdonald6.	Finance	Mr. D. S. Macdonald	Mr. O. E. Lang	Mr. A. C. Abbott7.	Fisheries and the	Mr. R. LeBlanc	Mr. M. Lessard	Mr. E. F. Whelan8.	Environment Indian Affairs	Mr. W. W. Allmand	Mr. J. J. Buchanan	Mr. J. Chretien9.	and Northern Development Industry, Trade	Mr. J. Chretien	Mr. L. S. Marchand	Mr. R. K. Andras10.	and Commerce Justice and	Mr. S. R. Basford	Mr. F. Fox	Mr. W. W. Allmand11.	Attorney General Labour	Mr. J. C. Munro	Mr. J. Roberts	Mr. J.-P. Goyer12.	Manpower and	Mr. J. S. G. Cullen	Mr. R. K. Andras	Mr. M. Lalonde13.	Immigration National	Mr. J. Richardson	Mr. B. J. Danson	Mr. A. J. MacEachen14.	Defence National Health	Mr. M. Lalonde	Mrs. I. Campagnolo	Mrs. J. Sauve15.	and Welfare National	Miss M. Begin	Mr. J. S. G. Cullen	Mr. J.-J. Blais16.	Revenue Post Office	Mr. J.-J. Blais	Mr. A. C. Abbott	Mr. J. C. Munro17.	Privy Council	Mr. A. J. MacEachen	Mr. J.-J. Blais	Mr. J. S. G. Cullen18.	Public Works	Mr. J. J. Buchanan	Mr. J.-P. Goyer	Mr. M. Lessard19.	Regional	Mr. M. Lessard	Mr. R. LeBlanc	Mr. D. J. MacDonald20.	Economic Expansion Science and	Mr. J. H. Faulkner	Mrs. J. Sauve	Mr. A. W. Gillespie21.	Technology Secretary of	Mr. J. Roberts	Mr. J. H. Faulkner	Mr. F. Fox22.	State Solicitor General	Mr. F. Fox	Mr. W. W. Allmand	Mr. S. R. Basford23.	Supply and	Mr. J.-P. Goyer	Mr. J. Richardson	Mr. B. J. Danson24.	Services Transport	Mr. O. E. Lang	Mr. S. R. Basford	Mr. R. LeBlanc25.	Treasury Board	Mr. R. K. Andras	Mr. J. Chretien	Mr. J. J. Buchanan26.	Urban Affairs	Mr. B. J. Danson	Miss M. Begin	Mr. J. Richardson27.	Veterans Affairs	Mr. D. J. MacDonald	Mr. E. F. Whelan	Mr. J. Roberts
P.C. 1976-2559. Certified to be a true copy of a Minute of a Meeting of the Committee of the Privy Council, approved by His Excellency the Governor General on the October 18, 1976. The Committee of the Privy Council, on the recommendation of the Prime Minister, advise that Order in Council P.C.
1976-2303 of September 20, 1976, which appointed Acting Ministers, be hereby amended by deleting items 23 and 26 from the Schedule thereto and substituting therefor the following:
[Stage Direction]

Order Paper Questions
Column I	Column II	Column Iff	Column IVOffice	Name	Acting Minister	Second Acting Minis"23.	Supply and Services	Mr. J.-P. Goyer	Mr. J. H. Faulkner	Mr. B. J. Danson""26.	Urban Affairs	Mr. B. J. Danson	Miss M. Begin	Mrs. I. Campagnolo"
Ralph Goodale: Mr. Speaker, if question No. 50 could be made an order for return, that return would be tabled immediately.


Walter David Baker: Mr. Speaker, I understand this is an answer to a question put by the hon. member for Leeds. Could the parliamentary secretary tell us the reason for this request?


Ralph Goodale: The document has just been sent to the table. It is voluminous. The reason for answering the question in this fashion is simply the length of the answer.


Walter David Baker: Agreed.


Mr. Cossitt: 1.	How many times since becoming a member of the Cabinet has the Minister of Transport personally made use of government aircraft and, in each case, what was the (a) purpose (b) point of departure and destination (c) type of aircraft used (d) cost to the taxpayer?
2.	What was the total cost to the taxpayer of all such trips?
3.	Which trips were for personal and political business?
Return tabled.



STARRED QUESTION


Mr. McKinnon: How much money has the government paid to Lockheed on the LRPA contract up to October 1, 1976, including the monies paid under the penalty clause of the first contract?


Ralph Goodale: On behalf of the Parliamentary Secretary to the Minister of National Defence, I should like to

provide an answer to this question. Up to October 1, 1976, $20,621,000 (U.S.) which amounts to $20,248,000 Canadian funds has been paid to Lockheed in connection with all phases of the Long Range Patrol Aircraft CP-140 Aurora program. No moneys were paid or are due as a result of the penalty clauses in the P-3 LRPA contract.


Mr. Speaker:: Shall the remaining questions be allowed to stand?


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Wednesday, November 3, consideration of the motion of Mr. Abbott that Bill C-16, to provide for the protection of borrowers and depositors, to regulate interest on judgment debts, to repeal the Interest Act, the Pawnbrokers Act and the Small Loans Act and to amend certain other statutes in consequence thereof, be read the second time and referred to the Standing Committee on Health, Welfare and Social Affairs.
A. Daniel McKenzie: Mr. Speaker, in continuing the debate on Bill C-16 let me say at once that since the bill was introduced a few days ago there has been considerable criticism of the poor manner in which this measure has been drafted. Consumers and lenders have listed complaints with regard to the proposals before us. They have drawn attention to inequities in those proposals. Once again we are being asked to deal with legislation which has been drafted in the absence of proper consultation with the borrowers and the lenders organizations.
The government would like us to hasten the debate on the various bills which are brought forward, but there is no way in which we in the opposition will agree merely to rubber-stamp pieces of legislation which have not been properly drafted and with respect to which the legitimate interests of those con-


cerned have not been taken into account. The Canadian Bankers Association considers it uncomplimentary to banks to have them and other legitimate financial institutions lumped together with loan sharks under the borrowers protection bill. This matter was mentioned yesterday.
Loan-sharking, Mr. Speaker, has nothing to do with the bill before us. Loan sharks form part of the criminal element and should be dealt with by the police. Mr. Frazee, who is the executive vice-president and chief general manager of the Royal Bank of Canada, feels the government, in seeking to achieve the commendable object of ensuring that the consumer is protected against unscrupulous lenders, has gone overboard in introducing legislation which covers all financial institutions. He also warned that if increased costs for legitimate lenders were involved in meeting the provisions of the bill, everybody, including consumers, would end up suffering.
Referring to the view of the government that because they have computers financial institutions should find no problem meeting the provisions of the bill, including the provision which specifies that interest shall be calculated and credited daily on deposit accounts, Mr. Frazee pointed out that all financial institutions are not fully computerized-the Royal Bank is not, for example-and that these provisions would mean employing increased personnel.
In addition, Mr. Frazee objects strongly to what he sees as an assertion in the bill that a lender is guilty until proved innocent. This is a reference to the unwarranted rate concept: the bill allows a borrower who believes he is being overcharged to stop payment on a loan or to apply to the court for a review of the credit charges. In case of such dispute, the onus would be on the lender to prove that the rate charged reflected only the normal cost of lending money and the risk presented by the borrower. Mr. Frazee suggested that this provision might allow some unscrupulous borrowers to take advantage of lenders. Another aspect of this bill to which Mr. Frazee objects is the one which prescribes that lenders must state a single effective credit charge for each loan. Included in that charge would be interest, insurance charges, brokerage fees and charges for appraisals, investigations and credit reports.
The views I have put on the record are examples of the criticisms which this poorly-prepared piece of legislation has been receiving. I can see we shall have our work cut out in committee before we are finished with the legislation. In all probability, the bill will have to be completely rewritten, and this would be just another useless and unnecessary delay in the operation of the House of Commons.


The Acting Speaker (Mr. Turner):: Order, please. The hon. member for Broadview (Mr. Gilbert) on a point of order.


Mr. Gilbert:: Mr. Speaker, yesterday during my speech on Bill C-16 I stated that to solve the problem of loan-sharking and excessive interest rates the minister was proposing to set a legal ceiling on interest rates. That legal ceiling would be seven times the present prime rate; in other words, the legal ceiling
Protection of Borrowers and Depositors that the minister intended to have would amount to between 70 and 75 per cent.
The minister challenged me on this, and I replied that I had read this information in press releases from the minister's office, that I had heard it said by the hon. member for Windsor West (Mr. Gray), by Conservative members and by one of my colleagues. The minister then rose on a point of order. I might say that when I said I had heard of it from one of my colleagues, the minister said that I had given a false impression. Therefore, I told the minister that after my speech 1 would check my notes to see where I had found the formula that the minister was proposing, and if I was mistaken and it was not in any of his releases, I would apologize to him.
I have checked my notes and the press releases, Mr. Speaker, and it certainly is not in the minister's press releases or in his speech. Therefore, I should like to apologize to the minister for making that statement. However, I should like to tell the House where I did get that statement and probably where Conservative members and the Liberal member for Windsor West (Mr. Gray) and my colleague from Timiskaming (Mr. Peters) got it. They got it from a letter that was sent to the minister by the Consumers' Association of Canada, dated October 20, 1976. 1 checked with the Consumers' Association of Canada who informed me they had obtained that information from a presentation contained in legislative proposals prepared by the minister's department for a convention in Ottawa of federal and provincial consumer and corporate affairs ministers. The proposal was used for discussion purposes on December 1, 1975.
Furthermore, Mr. Speaker, the CAC said they had an interview with the minister and his officials, and their letter of October 20 relates to those interviews. At that time the unwarranted rate was mentioned-in other words, the rate between 70 and 75 per cent, anything in excess of that being a criminal rate. They did discuss it with the minister and his officials and the minister did not deny it. As a result, the Consumers' Association of Canada wrote to the minister setting forth their views in that regard.
To further strengthen my contention in regard to the formula of seven times the basic rate, namely, between 70 and 75 per cent, and any interest charge over 75 per cent being a criminal rate, I checked with provincial ministers. I was advised that officials of the Department of Consumer and Corporate Affairs have advised officials in provincial departments of consumer and corporate affairs that this was the rate intended to be used by the minister with regard to the regulations he hopes to present to the committee.
In these circumstances, Mr. Speaker, although I have apologized to the minister for making a mistake by saying the information came from his press releases, I think he has been unfair not only to me but also to the hon. member for Windsor West, to Conservative members and certainly to my colleague for Timiskaming, and he owes it to the House to clarify the matter and to state categorically what the unwarranted rate and the criminal rate will be. It is not sufficient that he wait until we get to committee stage when he can present his


Protection of Borrowers and Depositors regulations. The least he can do is to be fair to members of the Elouse and tell them at this time. Otherwise, I think he has been unfair to me in challenging where I obtained that information.


The Acting Speaker (Mr. Turner):: Order. I would like to quote Standing Order 37(1):
No member may speak twice to a question except in explanation of a material part of his speech which may have been misquoted or misunderstood, but then he is not to introduce any new matter, and no debate shall be allowed upon such explanation.
The hon. member for Cape Breton-East Richmond (Mr. Hogan).


Mr. Andy Hogan (Cape Breton-East Richmond):: Mr. Speaker, before commencing my remarks I wish to congratulate the minister on his appointment from the backbenches. Being just two years in the House, he will realize that anything I say derogatory of the bill-because I really do not have much good to say about it-is nothing personal. 1 find it rather astounding, as one who still accepts the fact that there is a supernatural order and that there can still be miracles; but this is a new kind of miracle, that a minister can be appointed and within a month bring in legislation. It must have been churning through the bureaucracy. I get a great kick when I read legislation like this and realize that some are opposed to the decentralization policies of this government. For goodness sake, if this is the kind of efficiency that exists in the bureaucracy in Ottawa, it is no wonder the country is facing such terrible economic obstacles. I do not want to make a blanket condemnation, of course, because this would be quite unfair to many dedicated civil servants in various offices. Nevertheless, it seems to me obvious that one case of incredible inefficiency on the part of swollen bureaucracy in Ottawa is evidenced by the provisions of Bill C-16.
The minister says the bill is long overdue. That is one of the great understatements of this parliament. The minister has pointed out that under the British North America Act the subject of interest falls within federal jurisdiction, and he was frank enough to admit that existing legislation was hopelessly out of date. The fact that the Small Loans Act has not been amended for 20 years says a good deal about the way this country has been governed, and its economy managed, by recent Liberal governments.
The minister knows that since 1946 the total consumer debt of this country has increased from roughly $1 billion to more than $23 billion. As he noted, more than 65 per cent of that increase has occurred since 1967. In the period 1947 to 1975, non-mortgaged debt has increased three times as much as disposable income. Again I repeat that this says something for this and past Liberal administrations which have been so snail-like in attempting to make an honest commitment to protect borrowers from the inadequacies of present institutional arrangements between borrowers and lenders.
In light of spiralling increases in consumer debt in this country during the last 15 years, and the increasing publicity given to the maldistribution of income that exists, it is amazing
[Mr. Gilbert.) *
that we have taken so long to give adequate credit protection to the working and non-working poor, or at least to consider reforms in existing legislation. One would have thought that, given the fact that Great Britain, the United States and the most progressive European countries in the last 15 years introduced the type of legislation that is before us in this bill, this would long ago have spurred this government to come up with meaningful protection for low income borrowers, as they promised so fervently during the 1974 election campaign. It has taken them 2Vi years to get where we are now, Mr. Speaker. A lot of time will be spent in committee mending this legislation before I, for one-and, I think my party-will consider voting for it.
Since this legislation is designed, presumably, to protect those who are suffering from the persistent and continuing maldistribution of the national income, it might be well to remind ourselves of the seriousness of this disease which we seem to find so difficult to face. The widespread inequity in the distribution of the economic pie is suggested in a comparison of the figures issued by Statistics Canada for the period 1965 to 1974 which relate to the distribution of income by income groups. The percentage of total income received by family units-which is defined as including families and unattached individuals-between 1965 and 1974, for the bottom 20 per cent compared to the top 20 per cent, reveals the following: in 1965 the bottom 20 per cent received 4.4 per cent of the total economic pie, and in 1974 they received 4 per cent. While the top 20 per cent received 41.4 per cent in 1965, by 1974 they received 42.5 per cent. The sad part is that both in Canada and the United States the relative position of these groups has been the same since 1951, despite the increase in all the individual components that go to make up the welfare state in a mixed capitalistic system.
If we consider the distribution of income by income group and do not include family units which take in unattached individuals but only families, we find that the bottom 20 per cent earned less than $3,320 in 1965, and the top 20 per cent earned more than $8,944. In 1974 the bottom 20 per cent earned less than $7,480, while the top 20 per cent earned more than $20,174. The total income received by these families in 1965 was 6.2 per cent for the bottom 20 per cent, while in 1974 they received 6.3 per cent: In 1965 the top 20 per cent received 39 per cent, and in 1974 they received 38.8 per cent. According to Statistics Canada, in 1974 there were 5.5 million families in Canada and 93,500 families received less than $3,000 a year.
Some people claim that these statistics need to be qualified. It is pointed out, for instance, that the lowest income group who get such a teeny-weeny morsel of the economic pie are not a permanent group, but change from generation to generation. In the parlance of economists, they are a flow and not a stock. This takes nothing away from the argument that the lowest 20 per cent, made up largely of senior citizens and single women who are heads of households, suffer badly in our economic system. It is also pointed out that these figures make no


allowance for income "in kind", such as medicare and low-cost drugs for elderly citizens. But the very rich also receive the benefit of medicare, old age pensions, etc. Since we are talking about the relative positions of income groups, this fact has also to be considered. It is difficult for anybody to rationalize the curious and ugly symmetry which characterizes income distribution in Canada.
The report of the Senate committee on poverty which was published in 1971 showed that one of the major causes of low income, or poverty, was that regressive taxes such as sales, excise and property taxes, fall more heavily on these unfortunate groups. In other words, the effect of the income tax system which is progressive-that is, based on the ability to pay-is cancelled by the low income groups paying a proportionately higher share of these taxes that are not based on ability to pay. We all know that tax loopholes and shelters favour the high income groups in our society. We will be more specific on this matter later, Mr. Speaker.
In the debate on the Speech from the Throne, the leader of our party pointed out that under the registered retirement savings plan a tax shelter allowed those earning $25,000 or more to stash away $1,502 in 1974, while those in the $5,000 to $10,000 income bracket only saved an average of $34 under the same scheme. This party, in season and out of season, has stressed the unfairness of our total tax system.
In the 1972 election campaign we pointed out that the rich and the very large corporations were receiving income welfare payments and subsidies from the Liberal government through inequities in the tax system. We were told this was socialist propaganda. We pointed out that all kinds of hidden subsidies were being given to the large corporations and the upper income groups in our society. We were accused of pandering to the lazy by trying to correct some of these gross abuses through such things as a guaranteed income for the working poor and the non-working poor. It always struck us, and still does, as being somewhat paradoxical and odd that when the country gives such breaks to the large corporations and the wealthy, it is considered either a grant or an incentive to save; but when transfers are suggested for the lower income groups, we are criticized for pandering to the welfare bums.
Just yesterday the National Council of Welfare, scarcely a socialistic organization, brought additional conclusive evidence and confirmation of what we in this party have been claiming for a very long time. The council found that Canada's hidden welfare system allows the federal government to transfer billions of dollars to wealthy taxpayers through inequitable income tax deductions and exemptions. Some examples of existing inequities cited in the report are as follows. Someone earning $30,000 per year saves $62 in income tax for contributing $135 to the Canada Pension Plan, while someone earning $9,000 per year and contributing the same amount saves only $37. A woman earning $6,000 per year claims the $1,000 child-care deduction, thus reducing her taxable income for a tax saving of $257, while a woman earning $20,000 applies the same deduction, for a saving of $380. A person earning between $5,000 and $10,000 per year places $1,000 in
Protection of Borrowers and Depositors a registered home ownership savings plan and receives a grant or tax saving of $264.93, while the person earning between $15,000 and $20,000 saves $365.80 under the same plan.
The council, which is a government-financed advisory body for the Department of National Health and Welfare, maintains that average taxpayers, the middle and low income wage earners, are unaware of the mechanics of the Income Tax Act. It is also clear that it is they who bear the greatest burden of the costs I have mentioned, while it is the wealthy who reap the greatest benefits.
I have engaged in this preamble concerning income distribution and the inequalities of the tax system because I wanted the bill which we are debating on second reading to be put in the context of the political and economic realities of some of the major problems which face Canada today. It is unfortunate that the proposed legislation did not take these facts into account. Instead, Bill C-16 had its origin, as I noted before, during the 1974 election campaign. At that time, in an effort to obtain a majority government, the Liberals brought forward legislative proposals-but I note that most of these promises have not been kept after I'h years. The Liberals have never felt compelled to live up to their rhetorical flourishes on the campaign trail. F. R. Scott's closing couplet dedicated to Mackenzie King continues to apply to them: "Do nothing by halves which can be done by quarters". As Scott suggests, the Liberals do manage to bring forward bits of good legislation, however reluctantly.
One of the positive changes in this legislation, which has been noted by many speakers, includes standardization in respect of banks and financial institutions calculating interest rates on savings accounts. Presently, deposit institutions have a form of windfall profit because of their method of calculating interest. Interest charges will be figured on an annual basis and must be paid on the net principal sum, and will be calculated for savings purposes on the average, rather than the minimum amount in savings. The amount that the borrower will actually get in his pocket will be the basis of calculation, rather than the present system which includes administrative and other costs.
Third, we have the government's belated recognition that there is such a thing as a criminal rate of interest. Presently there arc no controls on the amount of interest some moneylenders can squeeze out of their desperate customers. As the minister noted in his speech, the loan shark racket has become, according to police sources, a $3 billion a year business in Canada. I, for one, have great reluctance in accepting that figure. I wish the minister would note, as he finds his way in his new ministry, that Statistics Canada should be pushed to come up with some reliable figures. Dependence upon police force figures in respect of loan-sharking seems to be an incredible, inefficient and questionable procedure. I very much doubt there is a business in illegal loan-sharking in Canada to the amount of $3 billion a year.
766


Protection of Borrowers and Depositors
Of course, if we include some of the loan-sharking which goes on in the finance companies we could easily come up with a figure of $3 billion. But in speaking of an underworld type of thing, as I believe is implied in the use of that figure, it strikes me that it is ridiculous. On this question, the minister also used statistics that were corrected by the hon. member for Windsor West (Mr. Gray) who mentioned that the minister had said that in the order of $296 million was lent in 1974 under the Small Loans Act with protection under the $1,500 loan level. As the hon. member for Windsor West pointed out, it is really more than $400 million that we are talking about.
In talking about this whole question of loan-sharking, whether legal or otherwise, the minister did not mention the measure of responsibility the government should accept for having allowed this situation to exist for so long. The fourth thing, in general, that is pretty good about this bill is that fixed rate mortgages will be brought into line with the present practice in respect of NHA mortgages. This measure is long overdue. It will allow up to 10 per cent of the outstanding principal to be paid on the first or second anniversary of the loan or on any payment after the third anniversary. All or part of the outstanding principal can be repaid, with the maximum penalty being three months' interest on the amount prepaid.
I thought it was kind of a joke, as I read some of the speeches, to find there were those who were so concerned that the "poor" trust companies and finance companies might lose in these transactions with the poor. The important thing is to help them become more competitive and to allow consumers to use the sovereignty that is supposed to be theirs under a competitive market system. Some members seem to be protesting against this, in favour of giving more protection to the lender instead of more freedom to the borrower, and therefore more competition among those who are lending.
That is what the private enterprise system is supposed to be all about. There must be controls on advertising, so that rates and conditions of credit will be prominent in the ads. There are some people among our party, and probably some among the backbenchers in all parties, who would like to see a total ban on credit advertising, but I think it has to be at least strongly regulated because one can often look in vain for the information aspects which are supposed to be the best part of advertising. So much of it is just waste.
We already know that one of the greatest weaknesses of the capitalist system, whether or not it is a mixed capital system, is the huge waste inherent in the economic institution called advertising, where we have in North America, I think, somewhere close to $30 billion a year now invested in that industry. It is very difficult, even for the most avid defender of that system, to say that most of that really contributes to the common good of the people in our countries. I know it is extremely difficult to regulate the informational component as compared to the other, but we must remember that the criticisms that are being made about the poor and low income people in respect of unemployment insurance, going after too much credit and all these types of things, relate to the values that are being created by the media which depend upon these

advertising revenues. They would ask the poor to turn themselves off and close their ears to this sort of thing because it is only geared to those who can afford it.
These are the cultural values and the cultural consequences of the system that is being defended here all the time by many spokesmen from the old-line parties. It is just like the criticisms that are made in respect of the poor blacks in the United States when they want cars or coloured television sets, and so on. Why should they not want these things, when they are being pushed by everything in that society to want them, and when the measure of value of the people in that society is so often the possession of material goods, money, and so on. What an insult to human beings! These represent either the cultural contradictions or the consequences of that system which must be faced. One is being hypercritical when one tries to blame the low income groups for so much that is society's own responsibility for what is really a cultural conditioning process. I do not say it is a deterministic one, but it is a cultural conditioning process which so many people in our society, including those who speak for the defenders of the capitalist system in the two major parties in this House, do not seem to want to recognize or take seriously.
To get back to the bill, Mr. Speaker, there are new disclosure rules in all credit transactions to standardize the formula for presenting such information so that it will be easily comparable. Of course, that is a step in the right direction. Finally, the administrator must enforce the act and advise the public of their rights under the act. In many ways, the success of the act will pivot on the terms of reference given to the administrator and, of course, the actual choice of the administrator. It is essential that an activist person, with legitimate and credible credentials, be chosen for this position. Let us hope that patronage will not play a predominent role in the choice of an administrator by a new minister who is trying to establish some credibility. The work which his department embraces is becoming a more and more important part of people's welfare in our society and it is desperately important that the right people are appointed at the top. This is what the bill proposes, and while I applaud many of the individual initiatives, the general thrust of the bill seems, to me, to leave much to be desired.
The first principle, establishing the fact that there is a criminal or usurious rate, is a breakthrough. Thomas Aquinas wrote about this, and I am glad hon. members on the other side have discovered this theologian who lived in the twelfth century. The Liberals have finally caught up with Aristotle and Aquinas, these men of history. But this principle must be coupled with other measures.
Any sincere effort to protect consumers from loan sharks and their criminal rates of interest must come to terms with the reasons people deal with loan sharks in the first place. Quite simply, financial institutions are unwilling to give some people loans because of the high risk they represent. The government should implement a comprehensive insurance


scheme for small consumer loans along the lines of the Canada student loan plan. When 1 was campaigning in 1974, I listened to the Liberal platform and sometimes said to myself that what they said was so good that it was too good to be true. In fact, now we find that it was so good that they did not even legislate it. Not only have they done this tremendous flip-flop on wage and price controls, as it is known in the country, but they did not even legislate the good things they were saying.
When they finally got around to legislating it 2'h years later, they neglected to put into legislation one of the principal things they offered to the Canadian people. That insurance idea was a tremendous selling point to the middle income group and low wage earners which, coupled with the promise not to freeze prices and wages, is in my opinion, largely responsible for the fact that the Liberal party is now in government. They promised this insurance scheme, and now they are not even offering it. Why is the government so scared of including an insurance scheme in this legislation along the lines, for example, of the Canada student loan plan? This would have a twofold effect. First, since banks and other financial institutions would be guaranteed payment-and we have nothing against that-interest rates charged to high-risk customers would no longer be justified. In reference to this point, I might add that the vast majority of high-risk loans, as has been repeated in the House several times, are repaid on schedule, thus creating no problem to the lending institutions. You can verify this by asking any credit union manager: he will confirm it. Thus you have the paradox of these institutions getting the highest return on loans to people who can least afford to pay it. Second, if these loans were guaranteed, the poor in many metropolitan areas-and the minister should recognize this better than someone like myself-would not be forced to turn to loan sharks, especially the illegal ones, but could deal with the legitimate lending institutions.
With this loan insurance scheme the criminal rate of interest could be set at a substantially lower rate than now envisaged, because the reason given for high interest rates by the legitimate store-front loan sharks-and they might not like to be called that, but in my experience even some of the respectable finance companies advertising in our media can be so called- is the risks involved. While it is true that there is a largely criminal element involved in loan-sharking, in my experience-and, I think, in the experience of many others-some of these finance companies can be rough on borrowers. Some hon. members seemed to be surprised at some of the things the hon. member for Timiskaming (Mr. Peters) mentioned about a certain individual who was forced to pay back his loan to a well known finance company. Coming from a mining town, I saw such things as furniture being removed from houses because people could not pay back their loans.
Of course, those finance companies have been engaging in a loud public relations campaign in recent years, saying that they have changed their methods and practices. Perhaps they have, but certainly they have left traumatic memories, aversion and resentment in those of us who saw some of their actions. So it seems to me no coincidence when we see in some
Protection of Borrowers and Depositors of the hard-hit, low income areas, such as the one I represent, the only new activity in the commercial centres of the various towns consisting of the opening of more and more finance companies. These companies may not be the sharks or barracudas mentioned by the hon. member for Nickel Belt (Mr. Rodriguez), but they sometimes remind me of vultures circling around a wounded animal, waiting to take advantage of the helpless victim. They advertise low monthly repayment schemes, but always play down the bottom line. The actual interest rate charged by the so-called good corporate citizens-only filling a need in society-often exceeds 24 per cent. It is vital that the government set clearly within this bill the maximum rate of interest that can legally be charged, rather than through regulation later. I was glad to hear my colleague, the hon. member for Broadview (Mr. Gilbert), making the point he did, and I think correctly, to the minister today. As a social democrat-


Mr. Paproski:: You are not a social democrat.


John Gilbert: I am a social democrat, a socialist and a New Democrat-certainly not a Liberal or a Conservative.


Mr. Nystrom:: Explain what a social democrat is.


Mr. Saltsman:: They wouldn't understand, anyway.


Andrew Hogan: It is vital that the government set the maximum rate of interest that can legally be charged clearly within this bill, rather than through regulations later. As a socialist, I would like to see the maximum interest rate allowable set at an extremely low level, but this cannot be done in isolation and, given the existing economic system, it is not possible. However, even given our present mixed capitalist economy, outlawing interest rates above 24 per cent would be feasible. The minister will be surprised at how many of his own backbenchers agree with that.
Now 1 would like to return to the matter of the role of the administrator in overseeing this legislation. His office has great potential, but his powers would have to be enlarged. As the legislation reads now, the borrower must initiate, through default, any action against the finance company. As the minister knows from experience-we come from different economic backgrounds, but surely he has had enough experience with low income people, or if he has not, surely the people who are advising him or some of his friends can tell him-these people will not take IAC or Household Finance to court. It is a clear misunderstanding of the way lower income people think, and ignorance which shows how scared they are of these institutions. My goodness, I run into people in my constituency who are scared of going inside a bank, let alone a courtroom.
The matter of going to a court was raised by the hon. member for Windsor West (Mr. Gray). The responsibility of taking corporations of large size to court strikes me as dreamy stuff. Most people do not want to be dragged into court by lending institutions, for any reason. In this regard the government is putting the cart before the horse. These people should
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Protection of Borrowers and Depositors
be able to appeal to an ombudsman. As the bill now stands, borrowers must renege on their loans and face court action to prove that the interest rates they have been charged are excessive. Does the government believe that people will use this type of mechanism to demonstrate that interest rates are excessive? If the minister thinks so, he is not in contact with the people that I am. I repeat, to most Canadians, being taken to court is a traumatic experience. There is a stigma attached to people who are taken to court. 1 do not foresee many hard working Canadians defaulting and then facing giant lending companies in courtrooms.
I suggest that borrowers should be able to turn to the office of the administrator-and I see his role as that of an ombudsman, which I would prefer him to be called. I think that is a Swedish term, and the Swedish people have made much more use of ombudsmen than we have. I think that is a good concept. Ombudsmen have a good image; administrators have not. Administrators are considered bureaucrats-and the AIB has not helped that, either. I see the administrator's role as that of an ombudsman who would have both the regional staff and the resolve to look into these matters.
The government has also decided to abolish the ceiling on interest rates on small loans under $1,500. The $1,500 level may be set too low, given the inflation we have been experiencing. This level should be raised to, perhaps, $3,500 or $4,000, but the ceiling on interest should not be removed. The minister should think about that and try to get some more advice on this matter. I just cannot understand some of the thinking of the people who prepared this legislation. The hon. member for Matane (Mr. De Bane) tried to defend this type of thing.


Mr. Abbott:: And did it very well.


Andrew Hogan: Nonsense.


John Gilbert: You cannot defend the indefensible.


Anthony Chisholm Abbott: It is very easy to defend, and he did it well.


Andrew Hogan: If the minister does not like what I am saying, he should read the speech of the hon. member for Windsor West. It may be argued by some that lenders will not make money available for small loans if a ceiling is placed on the interest rate. I am sure that is what the minister is talking about. This may well be true, but it seems to me that it can very easily be corrected by this government ordering lenders to make available a reasonable percentage of their lending capital to small loans. That does not seem to be an awfully difficult demand in order to help low income groups.
The government talks a lot about disclosure of all information relating to the true cost of loans, such as insurance, administration costs, et cetera. This is well and good, but the borrower should have all the information. The lender should have to tell his prospective customer his credit rating and how he arrived at the interest rate charged.
This bill tries to come to grips with the problem of the lack of consumer understanding of the credit system, but it falls short. The government should embark on an extensive adult
|Mr. Hogan.]
education program to make Canadians aware of their rights and responsibilities. Credit counselling could be done by setting up offices where they are needed. An important function would be to dissuade people from borrowing for things they cannot afford. That will be hard to do, considering that every day on television we are told to buy, buy, buy-and to buy on credit. People could be counselled to put off buying until they are in better financial shape. This education program could be handled by some non-governmental group such as the Consumers' Association of Canada. In addition, individual credit counselling could be carried out through local offices of the ombudsman and institutions delegated by him to perform this function. The ombudsman would thus oversee the legislation.
One of the things I like is the idea of data bank collection which is mentioned in this bill. I suggest to the minister that that will only give us more details about the use of consumer credit, but besides making this information generally available to business firms it could be an important source of information for government policy-making. Although this is not directly related to the bill, the hon. member for Vaudreuil (Mr. Herbert) issued a caveat about invasion of privacy. I think that is a good point. His notion is very sound and I think the Department of Finance should use the data as a tool of policy in order to make a better diagnosis of consumer intentions.


The Acting Speaker (Mr. Turner):: Order, please. I regret to inform the hon. member that his allotted time has expired. He may continue with unanimous consent. Does the hon. member have unanimous consent?


Some hon. Members:: Agreed.


Andrew Hogan: Bill C-16 was drawn up with the best intentions, but the substance is not there. I get the feeling that the people in the Department of Consumer and Corporate Affairs are completely out of touch with the people they are trying to help.
In his opening remarks, the minister said that Canadian banks are some of the largest and best run in the world, and that other lending institutions serve effectively and honestly the credit needs of Canadians. He neglected to add that they are also some of the most profitable. But for whom are they best run? Why is there a $1 billion to $3 billion per year loan shark racket? Why does that exist if lending institutions serve the public so well? The truth of the matter is that banks and other lending institutions have failed to provide the type of service Canadians have a right to expect.
In spite of the extravagant "Have you got a dream" advertising campaign of the Bank of Montreal and its assertion that it is there to help Canadians grow, the ultimate thing the Bank of Montreal, or any other bank, is interested in is the bottom line. With this in mind, if the government is serious about helping Canadians with their credit problems, careful and thorough regulation of these giant lending institutions is needed through this act and the upcoming changes in the Bank Act.



In summary, the government must face the fact that until a basic redistribution of income is achieved in Canadian society, all the tinkering of the Minister of Consumer and Corporate Affairs will come to naught. This bill could be a basis for Canadians to get a better deal from moneylenders and credit institutions, but only if the legislation is changed drastically in committee. First, the role of the administrator must be expanded to that of an ombudsman. He, or she,-not the courts-must have the power to rule on excessive interest rates charged to borrowers. That office must vigorously inform Canadians of their rights under this legislation. The rate of interest which would be classified as criminal must be set at a realistic level, somewhere between 24 per cent and 33 per cent per annum. The illegal loan sharks can be completely put out of business by proper licensing procedures. In committee, I hope the government will see the error of its ways and keep the ceiling for small loans.


Mr. Claude Lajoie (Parliamentary Secretary to Minister of Consumer and Corporate Affairs):: Mr. Speaker, 1 would first like to thank and congratulate all those who took part in the debate on Bill C-16, especially my colleagues on this side of the House. I offer my sincere congratulations to the Minister of Consumer and Corporate Affairs (Mr. Abbott) who had the courage to introduce this very sensible bill.
This bill is of great importance for Canadians, especially the less fortunate who are often victims of unscrupulous money lenders who are usually called loan sharks or underworld bosses. In my humble opinion, this is one of the most popular bills to be introduced; it had been expected and prepared for two years, and my colleague the Hon. Andre Ouellet, worked very hard on it when he was Minister of Consumer and Corporate Affairs. I would like to pay him tribute for the great work he did concerning this bill.
The Liberal party accepts members who do not necessarily share our opinions. The hon. member for Windsor West (Mr. Gray) proved this in his speech when he criticized and approved in principle the bill now before the House.
Mr. Speaker, I shall be brief. I shall make only a few comments so as not to delay passage of this bill. Therefore, if I may, I shall speak in general terms.

Mr. Speaker, I am full of enthusiasm about Bill C-16 now being debated in the House. The bill is, I believe, right and ripe, it having been introduced at the proper time when Canadians across the land have been asking for such protection. It is a bill with teeth, a bill with which everybody agrees in principle.

Why this bill? The federal government has the firm intention of protecting the Canadian consumer. Consumer credit has more than doubled since 1967 and has now reached over $24 billion, not including mortgages. Let me explain: The bill
Protection of Borrowers and Depositors also grants important rights to real estate owners who want to reduce their interests by prepaying their mortgages. Essentially, this is an improvement over traditional mortgage loans offered under the National Housing Act.
Other provisions will help consumers who take out a variable rate mortgage. The present legislation is outdated. The Small Loans Act was amended for the last time in 1956. This bill will rectify the situation. The complaints we are receiving show that, from a consumer's viewpoint, credit problems are among the most important. The government wants to make the rules of the game consistent and to simplify them as much as possible. The increase in loan shark activities calls for strong government action. Loan sharking has become organized crime's second main industry. According to police estimations, that racket is now getting over $3 billion in Canada.
What does the legislation in the way of protecting consumers? The bill will clarify credit rules by establishing uniform methods of computing interest, by forcing lenders to clearly disclose the terms of a loan, and by regulating credit advertising in every form. The bill will give increased protection to the borrowing consumer, by giving him more legal remedies, by allowing him to repay his debt at any time without penalty, except in the case of mortgages where penalties will be significantly reduced, by putting the burden on the lender to prove his case if things come to an end, and by limiting lender recourses for debt collection.
Any Canadian who has to risk his credit is entitled to a minimum of protection, just as the millions of people who try to lay their savings to advantage. This legislation will therefore provide and effective tool to fight loan sharking and establish a criminal rate beyond which any lender will face severe penalties ranging from $1,000 to $10,000 fines or up to years imprisonment, or both. The consumer will therefore get his money's worth. It is the federal government's duty to control unfair interest practices. We are determine to rid Canada of all loan sharking activities. There will be a legislation to help the consumer get a loan at a reasonable rate. Police forces will have legal means at their disposal to fight that terrible disease. Also, the onus of proof will rest with loan sharks and illegal lenders. Every lender will be forced to disclose the terms and conditions of the contract. Loans sharks who cash ahead of time family allowances cheques, social insurance or income tax cheques are profiteers who charge interest rates from 400 per cent to 1500 per cent to those poor victims. For loan sharks, it is the second biggest source of income. The first one being prostitution and the third, drug trafficking. This bill is aimed at eliminating intimidation and black mail.
This bill is not only concerned with lending transactions entered by trust or banking institutions. This government is also interested in the activities of every dealer, those who sell goods and services on credit, ranging from national or multinational enterprises to local car, clothes or furniture dealers.
The reign of the loan sharks is coming to an end. With the cooperation of the opposition parties we hope to see this bill through in the shortest time possible and we are ready to


Protection of Borrowers and Depositors
accept constructive suggestions. 1 have no doubt that the opposition will not demonstrate a mean and partisan attitude.


Mr. Eudore Allard (Rimouski):: Mr. Speaker, at the beginning of my few remarks on Bill C-16 1 should like to extend to the hon. member opposite my best wishes for success and a long life.


Some hon. Members:: Hear, hear!


Mr. Hnatyshyn:: A long life, anyway.


Eudore Allard: Mr. Speaker, there is no doubt that Bill C-16 that we are presently studying is extremely necessary for a very important number of Canadians who borrow or deposit money in the banks.
I agree with the minister when he says that the chartered banks are considered as the most important and better organized banks in the world and that, furthermore, some other credit institutions efficiently cater to the financial needs of all Canadians. But what 1 want to know is this: What is the rate of interest, what will be the costs to the borrower? It is quite clear that, pursuant to the British North America Act, the federal government has jurisdiction when it comes to interest rates and that any transaction made with an interest falls within the purview of the central government because when looking at the British North America Act, and especially at subsections (2), (3), (14), (15), (19) of clause 91, one can notice that the central government has all powers when it comes to trade and commerce, the raising of money by any mode or system of taxation, banks and the issue of paper money and, what we are particularly interested in, interest rates.
When he introduced the bill, the Minister of Consumer and Corporate Affairs declared, I quote:
The Interest Act was last amended in 1917. The Small Loans Act has not been amended for 20 years. In the last 30 years alone, total consumer debt-not including mortgage debt-has increased from less than $1 billion to more than $23 billion. More than 65 per cent of that increase has occurred since 1967. Today, excluding mortgages, consumer debt represents more than 22 per cent of our total disposable personal income. In the period from 1947 until 1975, non-mortgage debt has increased fully three times as quickly as income.
Mr. Speaker, when I read such figures, I cannot help thinking of unwarranted interest rates which are, in my opinion, the major cause of inflation in Canada and also of the prodigious escalation of Canadian consumer indebtedness as a whole. To correct this situation, the government has decided to introduce a very timely piece of legislation which, in its view, will help relieve market conditions and stimulate competition in such an important sector as consumer credit. I respectfully suggest, even though 1 support the bill, that if this government wishes to help the consumer, it should take the necessary steps to reduce interest rates and cut off incentives to loan sharks.
Mr. Speaker, consumers are going into debt to maintain, if not to increase, their standard of living and often to get out of

financial straits. To appreciate this, one only has to take a quick look at the last figures available, that is for June 30, 1976.
Canadian indebtedness represented the impressive amount of $20,263 million, an increase of 17.3 per cent over a year ago.
Curiously, one could read in the daily Le Soleil of September 24 last, and 1 quote:
It should be noted that chartered banks are the greatest credit dispensers with two thirds of the total. Personal loans as of July 30 last stood at $14,841 million, 23.7 per cent more than a year ago.
On the other hand, personal cash loans made by lending and finance companies represent a small percentage of the overall credit; they are even down slightly for the period under review. According to official statistics those loans stood at $1,773 million a year earlier.
As to credit extended by those same institutions to finance consumer purchases it accounted for a slightly higher volume at the same date, $1,143 million compared with $1,138 million a year ago.
That is not all, Mr. Speaker. Canadians are borrowing more than ever on life insurance policies. Up to the month of August 1976 loans on life insurance policies stood at $1,202 million, an increase of 6.8 per cent, and outstanding credit at $1,186 million exceeds by even $100 million the credit obtained in department stores. I sincerely think that the rise in interest levels that we witnessed in recent years and even today is simply due for a large part, of course, to our institutional structures because there is no doubt that our financial institutions exercise and have exercised considerable influence on rising interest rates.
In January 1924 at the general shareholders meeting of the Midland Bank of London, Mr. Reginald McKenna, president of that bank and also former British Chancellor of Exchequer, had this to say:
1 am afraid the average citizen would not like to be told that banks can
Note what he is saying.
-and that is what they do-create and destroy money (credit). The amount of money in existence varies only through the action of banks increasing or reducing their deposits or banking purchases. Any loan, overdraft or purchase by the bank creates a deposit; and any reimbursement of a loan, an overdraft or a sale destroys a deposit.
So this can be summed up this way, Mr. Speaker:
Every bank loan creates a deposit and every repayment of a bank loan destroys it. In addition, it is a well known fact that through the leverage given to them by Canadian legislation, the chartered banks manage to lend, while maintaining a low statutory margin, up to 16 times the amount of this margin, thus creating a new purchasing power. The same banks have acquired those privileges of creating credit out of nothing and of charging a penalty under the form of interest to the borrower, simply because they have every power to create the money required to achieve their aims.
Obviously, this enables us to compare such procedures with the honest behaviour of a citizen who buys government savings bonds available to chartered banks. It simply happens that the poor fellow who has worked hard to save a few pennies invests his few savings, while the banks secure a powerful financial control over the government thanks to the money created


through a manipulation of the banking system. Besides, among all sectors of society, the banks are the only ones which create their means of payment out of nothing. Therefore, it is fair to say that the methods used by the banks to get hold of our country and of the Canadian people are nothing but sheer fraud.
Mr. Speaker, 1 really think that high interest rates are inflationary since they result in higher costs for those who are able to obtain funds and follow the average increase in the cost of living index. In other words, interest rates adjust to inflation and, as a result, interest rates go up along with other costs, just as labour unions claim that wage increases do not preceed rising prices but rather simply proceed from them. As far as I am concerned, I think labour unions are justified in demanding wage increases in view of the ever rising cost of living.
So, I tend to believe that higher interest rates produce exactly the same effects. Frankly, it is easy to admit that everyone is in debt, that all governments, provincial, municipal and federal are hopelessly in debt, and that those debts, because of the millions of dollars paid in interest every year, can only add to inflationary pressures. As we know, that interest is paid by the taxpayers through their taxes. Taxpayers do not print money and so they have to ask for higher incomes and ever increasing salaries to meet cost requirements. All those taxes are finally included in prices because that is the only way producers can recoup higher costs.
The consumer, in an attempt to make up the taxes deducted from his paycheque, through pay deductions, and just like the producers, demand ever higher salaries and wages. One can therefore readily conclude that higher taxes, because of the interest governments at all levels have to pay, a.e reflected in consumer prices and, as a result, add to the growth of inflation.
Mr. Speaker, the statistics quoted previously prove that all Canadian taxpayers suffer from inflation, that worldwide plague, and increasingly higher interest rates. Add to this, of course, our governments. In this regard, former Bank of Canada governor Louis Rasminsky, in a brief presented on July 3, 1969 to the Standing Committee on Finance, Trade and Economic Affairs, said, as reported on page 2749 of Issue 55 of its Minutes and Proceedings, and I quote:
One of the casualties of a prolonged period of inflation is the market for long-term debt obligations. This is because investors become increasingly reluctant to commit their funds in such a form even at progressively higher interest rate levels. Private corporations who wish to raise long-term funds can try to combat this trend by offering equity participation, often in the form of convertible debentures, but this option is not open to governments-federal, provincial or municipal-or to home buyers or to publicly-owned utilities who must rely on debt financing to cover their borrowing requirements. It is social capital formation rather than private capital formation which must bear the brunt of the harm done to the long-term capital market by inflation.
Mr. Speaker, before closing this brief statement, I would like to draw your attention to the subject of credit cards.
Protection of Borrowers and Depositors
In the Journal de Montreal of November 3, 1976, there is on page 10 an article entitled as follows: "Explosive Danger". Here is what is says:
What would you say if an individual stole your pay every month and asserted in all seriousness that he was doing you a service? You would simply say: He is nothing but a thief. But it is true. Hundreds of thousands of Quebecers are so treated each month and they applaud. You know as well as I do no one is as shrewd as a banker to pocket his neighbour's money. But one day, one of those money men-I don t know who, unfortunately-had a strike of genius, the credit card. I give them a credit card that allows me to lend them money at a higher rate still and I bet ten to one that they will all applaud.
And our poor man was right. Who does not go around without his little plastic card? This genius of a banker had just sparked a revolution in the world of credit and consumer behaviour. In the imaginary museum of the consumer, this inventor should be put on a throne in the best room. The dream was limitless, except for the nightmare. Here is what does happen. You are idly walking around the stores with your little card in your pocket, and with no particular purpose in mind. All of a sudden, without any warning, you are overwhelmed with a tremendous desire for possession while standing in front of something which is useless more often than not, and lo and behold, you buy saying to yourself that you will arrange to have the payments made over 12 or 24 months.
You have just borrowed from the bank which issued your credit card, at a 18 percent interest rate. This is why bankers are terribly pleased when you refer to credit cards. If you have something important or essential to purchase and you do not have the cash for it, why not go to your credit union or your bank where interest rates fluctuate around 14 percent. This way, you are not using your credit card and you will be saving at least 4 percent interest.
Mr. Speaker, this is the plain truth, is it not? Bank credit is simply created by a mere stroke of the pen under a legislative authorization. At any rate, one may conclude that the government instead of being a servant of the people is forced to become their oppressor because of the pressure from financial institution. Admittedly, this kind of situation may tend to have serious consequences on the stability of our economy.
The government has just now realized that Canadians are relying on him to draw the abscess which has been actually undermining the economic health of our society for so long; whether you like it or not, the active forces in our society are increasingly becoming mere robots for the consumer public. As a matter of fact, beyond the limits set by a legislation which is no longer adequately protecting and defending the consumer and which is finally becoming obsolete there are open fields of activity in want of development.
Mr. Speaker, the same goes when it comes to buying, selling or financing new and second hand cars because, if my information is correct, there is hardly any control over this production and consumption sector which is spreading in the international market. Just think about pressure selling best exemplified by hawking which results in misrepresentations and breaches of trust, and God knows what else. One only needs to go to large stores to realize how easily credit is obtained through budget plans and credit cards. From all this one may conclude that publicity leads the dance and Satan calls the tune.
In my opinion, it is high time the government denounced the inadequacy and obsolescence of the legislation which is completely outdated because of the well-organized invasion of mass production which subjects the consumer to the law of the jungle. The government should promote the drafting of a fair, just and clear legislation based on the needs of today's consumers. I also believe it is high time the government saw to it


Protection of Borrowers and Depositors
to establish some protection and defence organizations for those consumers who are unfortunate enough to become the victims of loan sharking and exploitation. And what is more comical about the whole matter is that all this is sometimes legalized and consumption is encouraged through the creation of needs by artificial means most of the time. Moreover, a solution might be for the government to try and establish popular schools in order to convey to consumers of all ages, both indidually and collectively, some basic information as a first means of defence, thus giving the legislation a role of rehabilitation and prevention.


Ramon John Hnatyshyn: Mr. Speaker, I want to direct a few remarks to this bill primarily because I did not have the opportunity earlier to congratulate the new minister upon his appointment. I feel a certain kinship with the minister because of the fact that we were both elected in 1974, and because at some time in the past we each sat in the official gallery of the House as executive assistants. I understand some of the exasperation the hon. gentleman may feel, coming into parliament and trying to put into action some of the advice he has been giving over past years.
I wish to draw attention to a few points of interest to me with respect to this legislation. The bill before us has been promised for a considerable period of time, and 1 compliment the government for finally having brought forward the new piece of legislation designed to give borrowers some protection against excessive charges and interest rates. I have personally been interested for some time in updating federal law in this area, and on earlier occasions since 1 was elected I have urged the government to take action in this regard.
It is worth-while noting that the bill before us repeals the interest Act, an insignificant piece of legislation in some respect. I recall, shortly after I graduated from law school, my principal in the law office in which I articled talking to me about conveyancing and mortgages and calling to my attention one of the law's provisions which, I imagine, is very little known. Nevertheless, it is a provision which a lot of people who have mortgages on their homes might like to consider because the effect of it is that unless the mortgage states that the computation of interest is to be made either yearly or half-yearly, and not in advance, then the interest requirement is not enforceable.
I have never heard of anyone bringing an action to seek a declaration that interest payable under a mortgage loan might not be payable because the particular provision of the Interest Act to which I have referred was not complied with, but I wonder whether the minister has it in mind that, on the basis of the precedent established in the Interest Act, interest might not be payable should there be a breach of the legislation he is proposing.
Those who read Hansard might have an opportunity of reading their own mortgage documents and ascertaining whether the wording referred to in the Interest Act is actually contained in such documents. They may then look at the Interest Act and get in touch with their legal counsel with
[Mr. Allard.)
regard to the obligation to pay interest under their respective mortgages. That advice is my little service today to the individual who has a mortgage against his property-and it is something that very few people are aware of.
There are also some other aspects that might be considered in this kind of legislation. I do not know whether the minister would be receptive to specific suggestions for amendments, but one amendment I have in mind might be more drastic than he is contemplating. Coming from Saskatchewan, I can say that the history of the province is such that with it's boom and bust cycle after the great depression, there has been legislation passed which, in effect, puts limitations on remedies available to mortgagees and persons who lend money on the security of real or personal property, which leads me to think out loud, so to speak, that there is room for a similar kind of provision in legislation such as that presented to the House today.
Specifically, I am referring to the kind of provision existing in many provincial jurisdictions in regard to residences or homes, where there is a limitation placed on the remedy available to persons lending money on the security of a mortgage. In many provincial jurisdictions a person lending money on such security is limited to realizing the security itself. In other words, if I were selling a house for $50,000 and received a downpayment of $5,000, and the balance of $45,000 was in the form of a mortgage against the house, in the event of default, in many provinces a limitation is placed on the lender in that he can only realize on the security to the extent of the amount realized on the sale of the house under foreclosure proceedings, whether the sale realized the balance owing of $45,000 or not.
Since the federal government is deeply and heavily committed in the mortgage loan field, it seems not an unreasonable proposition, to me at least, that we consider the following. Wherever a mortgage is used as the basis of security on a home, we might give consideration to limiting the remedy of institutions under federal jurisdiction to the extent of their security under the mortgage as opposed to a right that involves a dual remedy that the mortgagor has to have a judicial sale and then to sue the borrower for any deficiency in amount after the house is sold and the proceeds applied to the balance of the mortgage.
If this legislation is to be regarded as social legislation, we should also consider federal responsibility in the house building and home ownership field. It seems to me that that principle might apply not only to the home itself but to the furnishings. Here, again, there could be a limitation on the remedy of a person who lends money on the security of, say a refrigerator, stove or furniture. Such remedy would be restricted to repossession and realization of that security.
I think there is a good deal to be said in support of the proposition that, aside from the interest rate provision and the attempt to limit the interest charges, consideration should also be given, in the case of institutions under federal jurisdiction, to some sort of limitation of the right of the lender and his


remedy vis-a-vis the home owner, the person buying a home. I think there would be great support for such provisions, not only because the government would then demonstrate its interest in the encouragement of home ownership, but also it would give many home owners some protection. 1 think the minister would agree it would include many young people, such as newly married people who need some sort of protection during the first years of life. I commend some of these ideas to the minister with a view to seeing whether or not the government is interested in extending the protection afforded borrowers and consumers in the two areas I have mentioned.
I also think the federal government is to be commended on coming forward with this legislation even at this late date. Quite frankly, I think the federal government has lagged behind many provinces in this field. Perhaps this is understandable, in view of the fact that the provinces have jurisdiction over property and civil rights and are more directly concerned with this kind of legislation. However, it seems to me that the federal government is now becoming greatly involved in the area of consumer borrowing. In addition, NHA has assumed dimensions of great importance in this country, and CMHC has grown from very modest proportions as originally introduced by the Liberal government in the fifties. Under the leadership of the right hon. member for Prince Albert (Mr. Diefenbaker) when prime minister, the National Housing Act came into its own and a substantial amount of money was made available for home building, which was given real impetus by the government of that day.
I said I would not take too much time, Mr. Speaker, but I do want to commend the government for bringing in legislation to deal with the growing and rather questionable businesses involved in making advances on income tax refunds and welfare cheques. I have written to the minister's predecessors in office regarding constituency complaints about this sort of thing which, quite frankly, feeds on the poor and on people not able to protect themselves. I would be the first to commend the minister on bringing forth this kind of provision and seeing that it is carried out. I do not want to be too negative or critical in my remarks on the bill, and this is one area in which I congratulate the minister and regarding which he will have my full support. This is an insidious practice that goes on in our larger cities, though in many medium-sized cities as well.
One other aspect of the bill on which I want to ask the minister a question, and on which he can possibly elaborate during the course of committee debate, has to do with the absence in the bill of any provision giving consumers access to their credit rating file and their concurrent right to correct any errors on it. We never really know what collection agencies or credit agencies are saying about us. As a friend of mine once said of me-almost anything you could say about me is probably true and I would not have any recourse. On the other hand I am sure my colleagues in this House, most of them being honourable gentlemen, share my concern that information picked up by collection agencies or credit agencies might have very serious consequences in respect of one's ability to obtain necessary financing. That seems to be a not unreason-
Protection of Borrowers and Depositors
able proposition and in accordance with at least the apparent undertaking for openness in government mentioned in the Speech from the Throne.


Walter David Baker: Do not dignify it by the word "undertaking".


Ramon John Hnatyshyn: My colleague, the hon. member for Grenville-Carleton (Mr. Baker) questions if it is an undertaking. We are a little apprehensive about the undertakings of this government, Mr. Speaker, but they did mention that they are changing their course and in future will be more open with the Canadian public. I agree with that. If they carry out this undertaking, they will receive their just reward.
In this legislation there is room for provision that any consumer who wishes would have the right to obtain copies of information on file with respect to him, and would have the concurrent right to correct any errors therein. The other aspect of the bill which concerns me is the prohibition on unwarranted interest rates. The bill does not specify any ceiling for interest rates. That will, presumably, be left to the discretion of the minister. This opens up another question that concerns me, because in my observation this government has a propensity for introducing legislation inevitably containing a provision that regulations can be brought forward by order in council to give effect to the act. I hope the minister will not succumb to this tendency to govern by regulation.
I have noticed in my time in this House that some of the most important legislation to be presented has come in the form of bills with perhaps 10, 20 or 30 clauses, the main one providing that the governor in council may make regulations to give effect to the legislation. An example is the Anti-Inflation Act. The only provision of any consequence in the bill gave the cabinet power to move by regulation as opposed to having the details of the governing law outlined in the statute. I abhor this tendency, Mr. Speaker and I am sorry to see that a similar provision exists in the legislation before us. It is appalling how often the government attempts to move by regulation rather than by legislation which is open to the scrutiny of parliament and the public. This should not continue, and it will not after 1978 when I am sure this party will form the government.


Some hon. Members:: Hear, hear!


Ramon John Hnatyshyn: The propensity of this government to operate almost exclusively by regulation and arbitrary measures is unfortunate, to say the least. Clause 31 of the bill gives power to the minister to make regulations for carrying out the purposes and provisions of this act as he deems appropriate. I think the people of Canada are interested in giving parliament a more important role and meaning as far as law-making is concerned.


An hon. Member:: I thought you said only five minutes.


Ramon John Hnatyshyn: Mr. Speaker, when the hon. member for Regina-Lake Centre (Mr. Benjamin) has to catch a plane, I
774


Protection of Borrowers and Depositors always want to accommodate him. 1 did not want to take very much time in this debate, and 1 have spoken briefly on some very important matters relating to this bill. I shall say nothing more at this time and will let the matter go back to the minister.


Some hon. Members:: Oh, oh!


The Acting Speaker (Mr. Ethier):: Order, please. Before I recognize the Minister of Consumer and Corporate Affairs (Mr. Abbott) it is my duty to inform hon. members that if 1 do recognize the minister, he will close the debate.


Anthony Chisholm Abbott: Mr. Speaker, I thank you and I thank hon. members for their very constructive interventions. Had time permitted, I should have liked to have answered some of the points that hon. members made in detail, but I know all hon. members are anxious to see this bill approved in principle so that it can move to committee.


Some hon. Members:: Question.


An hon. Member:: Five o'clock.
Loans Act and to amend certain other statutes in consequence thereof, be read the second time and referred to the Standing Committee on Health, Welfare and Social Affairs.


The Acting Speaker (Mr. Ethier):: Is the House ready for the question?


Some hon. Members:: Question.


The Acting Speaker (Mr. Ethier):: Is it the pleasure of the House to adopt the said motion? All those in favour will please
say yea.


Some hon. Members:: Yea.


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


Some hon. Members:: Nay.


The Acting Speaker (Mr. Ethier):: In my opinion, the nays have it.
And more than five members having risen:


The Acting Speaker (Mr. Ethier):: Call in the members.
The House divided on the motion, which was agreed to on the following division:



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Speaker:: Order, please. It is my duty, pursuant to Standing Order 43, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Winnipeg North Centre (Mr. Knowles)- Statutory holidays-Possibility of legislation establishing Heritage Day; the hon. member for Victoria (Mr. McKinnon)- National defence-Failure to reinstate William Biggs- Request for inquiry; the hon. member for Egmont (Mr. MacDonald)-Regional economic expansion-Reason for failure to make changes to incentives act.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Abbott that Bill C-16, to provide for the protection of borrowers and depositors, to regulate interest on judgment debts, to repeal the Interest Act, the Pawnbrokers Act and the Small

Abbott
Alexander
Allard
Anderson
Andras
(Port Arthur)
Andres
(Lincoln)
Baker
(Gander-Twillingate)
Baker
(Grenville-Carleton) Balfour Basford Beatty Beaudoin Bechard Begin (Miss)
Blais
Blaker
Brisco
Buchanan
Caccia
Cafik
Campagnolo (Mrs.) Campbell (Miss)
(South Western Nova) Campbell
(LaSalle-£mard-Cote
Saint-Paul)
Chretien
Clark
(Rocky Mountain) Clarke
(Vancouver Quadra)
(Division No. 6)
++YEAS
Messrs.
Clermont
Collenette
Corbin
Cote
Crosbie
Crouse
Cullen
Cyr
Danson
Darling
Daudlin
Demers
Dinsdale
Dionne
(Kamouraska)
Douglas
(Bruce-Grey)
Duclos
Dupras
Ellis
Elzinga
Epp
Ethier
Fairweather
Faulkner
Flynn
Fortin
Foster
Fox
Francis
Fraser
Friesen
Gauthier
(Roberval)
Gendron
Gillespie
Gillies
Goodale
Goyer
Grafftey
Gray
Guay
(St. Boniface) Guilbault Haidasz Halliday Hamilton
(Qu'Appelle-Moose
Mountain)
Hargrave
Harquail
Herbert
Hnatyshyn
Holmes
Holt (Mrs.)
Hopkins
Horner
Howie
Huntington
Isabelle
Kaplan
Knowles
(Norfolk-Haldimand)
Korchinski
Lajoie
Lalonde
Lambert
(Bellechasse)
Lambert
(Edmonton West)
[Stage Direction]

Currency and Exchange Act CURRENCY AND EXCHANGE ACT
Landers	Messrs. Martin	RitchieLang	Masniuk	RobertsLanglois	Mazankowski	RobinsonLaniel	McCain	RompkeyLa Salle	McCleave	RondeauLavoie	McGrath	RooneyLawrence	Mclsaac	RoyLeblanc	McKenzie	(Timmins)(Laurier)	McKinnon	RoyLeBlanc	McRae	(Laval)(Westmorland-Kent)	Milne	Sauv6 (Mrs.)Lee	Muir	SchellenbcrgerLefebvre	Munro	SchumacherLessard	(Esquimalt-Saanich)	SharpLoiselle	Munro	Smith(Chambly)	(Hamilton East)	(Churchill)Loiselle	Nielsen	Smith(Saint-Henri)	Oberle	(Saint-Jean)Lumley	Olivier	StanburyMacDonald	Paproski	Stevens(Cardigan)	Parent	StewartMacDonald	Patterson	(Marquette)(Egmont)	Pearsall	StolleryMacdonald	Pelletier	Tessier(Rosedale)	Penner	TowersMacEachen	Pigott (Mrs.)	TrudelMacFarlane	Portelance	TurnerMacGuigan	Poulin	WatsonMacquarrie	Railton	WhelanMalone	Raines	WoolliamsMarceau	Reid	YanakisMarshall	Reynolds	Young-169Brewin	NAYS Messrs. Gilbert	LeggattBroadbent	Hogan	NystromDouglas	Knowles	Peters(Nanaimo-Cowichan-	(Winnipeg	SaltsmanThe Islands)	North Centre)	Symes-11
Mr. Speaker:: I therefore declare the motion carried.
Bill read the second time and referred to the Standing Committee on Health, Welfare and Social Affairs.


Mr. Speaker:: It being five o'clock, the House will now proceed to the consideration of private members' business as listed on today's order paper-


Some hon. Members:: Six o'clock.


Mr. Speaker:: There seems to be some disposition to dispense with private members' hour and call it six o'clock. Is that agreed?


Some hon. Members:: Agreed.


Mr. Speaker:: It being six o'clock, I do now leave the chair until eight o'clock this evening.
At 5:45 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.

Hon. Donald S. Macdonald (Minister of Finance) moved: that Bill C-5, to amend the Currency and Exchange Act and to amend other acts in consequence thereof, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.


Mr. Robert Kaplan (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, this bill should be viewed as an accompanying bill to Bill C-18 which is "an act to ratify the Bretton Woods Agreements." Taking the two together there is, of course, a great deal to say about them. The Currency and Exchange Act, which is before us now, has the simpler background. I can tell the House that the minister will be piloting the Bretton Woods Agreements measure, Bill C-18, and will have considerably more to say about it.
The main purpose of Bill C-5 is to make Canadian legislation with respect to currencies and official international reserves consonant with the amended articles of agreement of the International Monetary Fund. At the same time we are taking advantage of the occasion to introduce a few other amendments of a technical nature.
The amendments before us will give legal sanction to the use of the special drawing right and similar composite units of account in Canadian contracts. It will also give authority to the governor in council to specify how values expressed in SDRs, gold, or foreign currencies are to be calculated in terms of Canadian dollars. This latter provision is intended to remove any legal ambiguity which might arise as a result of the changing role of gold and SDRs as units of account.
We are also proposing that the assets of the Exchange Fund Account, which are denominated in SDRs and foreign currencies, should be valued at current exchange rates so that their value in Canadian dollar terms is accurately reflected in the public accounts. At the same time, given the possibility of large but reversible movements in exchange rates, we do not wish to see large, offsetting charges and credits being made to the Consolidated Revenue Fund in consecutive years. Accordingly the amendments provide for a three year averaging period for these valuation changes.
The list of assets eligible for investment by the EFA is being expanded to include government securities in freely usable currencies with a maturity of not more than two years. The EFA would also be empowered to lend its gold holdings.
Finally, at the request of the Auditor General's office, the requirements for the Auditor General's report are being changed slightly to bring them into line with those contained in other legislation.
In sum these amendments are largely technical in nature and are designed primarily to reflect in Canadian law and practice the changes that are taking place in the international monetary system.
80001 -soy2


Currency and Exchange Act


Sinclair McKnight Stevens: Mr. Speaker, I hope the Minister of Finance (Mr. Macdonald), who I see is in the Chamber, will join in this debate before the evening ends. 1 am surprised he did not speak first himself instead of leaving that task to his parliamentary secretary.
I note that in the statement which the parliamentary secretary read the bill was described as a companion piece to the Bretton Woods Agreements bill which will be coming before us later. He said, further, that while there are certain matters of consequence in it, the bill contains a lot of technical features. Mr. Speaker, it is all very well for a parliamentary secretary to come in and read a page and say, in effect "Don't worry, let's get this passed", but I believe that all members, before deciding how they wish to vote, should get these proposals into perspective.
We are dealing here with billions of dollars and I suggest, Mr. Speaker, that if they read some of the technical features of the bill every member of the House would be alarmed by what the Minister of Finance is proposing. I shall be dealing with this aspect more fully later, but I would draw the attention of the House in particular to Clause 5. The parliamentary secretary did not even refer to Clause 5, though that clause contemplates taking away from parliament its right to have the Auditor General report directly to the House concerning transactions involving the exchange fund and covered by the act we are being asked to amend. One of the most fundamental rights this parliament has is to preserve the independent position of the Auditor General so he can report as he sees fit to this House.
I should like to take the House through the sequence of events leading up to the point where we are now being asked, in effect, to cut off one more right parliament has to scrutinize the spending and general financial activities of the government. I feel it is time the members of the House stood up and said that they have had enough of the government's tendency to whittle away the few remaining rights that parliament has over the government of the day.
Let me put it in perspective, Mr. Speaker. Perhaps there is no more volatile question in the world today than that of exchange. There is no more volatile financial or economic factor than the changing of world current account balances. For example, let me refer to the Bank of Canada Review which gives the highlights of the OECD's economic outlook in its monthly publication for August of this year. On page 13 of that Review, in table III, you will see the magnitude of current account balances or imbalances at the present time. These figures are truly staggering.
The total OECD deficits in 1976 are going to be $20 billion. I emphasize that 25 per cent of those current account balance deficits are in this country alone. We have the largest single deficit of any OECD nation listed in the Review to which I have referred. In total OECD anticipates a $20 billion deficit for 1976, and of that amount $5 billion is for Canada alone. The United States deficit is $3.5 billion, Japan has a surplus,

France has a deficit of $2.75 billion, Germany has a surplus, Italy has a $2 billion deficit, and the United Kingdom has a $2.5 billion deficit.
Just on that point, Mr. Speaker, how often are we quick to laugh almost at Great Britain's dilemma? But let us not forget that in the current year we are running a current account balance deficit twice the amount estimated by the OECD report. Let us not assume that this is some type of temporary situation. The fact is that the deficit to which I have referred is likely to continue. The Review shows that, based on an annual report, in the first quarter of 1977 the deficit for OECD countries will have risen to $23 billion.
What I am trying to show, Mr. Speaker, is that we are dealing with huge deficit figures in the world today in terms of current account balances. The OPEC countries, the petroleum exporting countries, have a huge surplus of $51 billion contemplated in 1976, and the non-oil producing countries have a deficit of $21 billion. Other countries have a deficit of $13 billion. The world total deficit will be $3 billion. In short, Mr. Speaker, we have a situation where two industrialized nations, Japan and Germany, are in surplus, the largest surplus is among the OPEC nations, and huge deficits are being piled up by all other nations. That is the framework within which we should consider this bill tonight.
Where does Canada fit into all of this? The fact is that Canada will be called upon, indeed, has been called upon, to share in the bailing out of some countries that have run up big deficits. As we know, Great Britain is in a rather serious predicament. The pound has fallen dramatically and Britain has asked the International Monetary Fund to bail her out immediately with a loan of $3.9 billion. After she receives this money, assuming it is granted, it is contemplated that they will ask world nations for a further bail out of $10 billion.
Rather than the Minister of Finance trying to slip this bill through the House tonight, I suggest that he owes the House a full explanation of what is the government's position in relation to bailing out such nations as Great Britain, Italy, or whoever it is who is looking for credit. Once again I point out, as we did earlier today, that the Minister of Finance went to Manila and entered into some private discussions with World Bank and International Monetary Fund officials, but has never come back to the House and made a statement on what he suggested, or negotiated, or given us any type of briefing on what transpired at Manila, and this in spite of the fact that tremendous amounts of money will be required to bail out various countries with currency problems.
Surely this House is entitled to know what the minister is commiting us to at some of these conferences at which he likes to turn up and puff around like a world figure. I have a copy of the speech that the minister made in Manila so let hon. members not simply take my word as to the size of the problem. In his speech the minister said:
-the liquidity of the Fund has dropped to a low level. I must say frankly that I am concerned about the financing of the Fund programs. There may well be difficulties for the Fund in meeting its commitments if more countries do not, as a matter of urgency, make their currencies freely usable for Fund transactions.


The entry into force of new quotas, the economic recovery and the provisions of the amended Articles will all have a beneficial impact on the liquidity of the Fund. But this will take time and will not solve the problem we are facing right now. I would consequently hope that member countries would make appropriate arrangements with the Fund for the free use of their currencies as soon as possible.
Earlier in his address the minister said this:
In the session of the Canadian Parliament which will commence as I return to Ottawa, I intend to introduce the necessary legislation to adopt the amended Articles.
That is, of the International Monetary Fund. In Manila the minister mentioned he was going to introduce legislation, and we have one of the bills before us tonight. Yet we are not even given the courtesy of having the minister stand up and explain, in introducing the first piece of this legislation, what it is he has in mind and what exactly were the commitments that he made on behalf of Canada when he was in Manila. In my view, Mr. Speaker, that is not what this parliament deserves from the Minister of Finance. If commitments are going to be made to help other nations, either through the International Monetary Fund or directly, then we should learn from the government exactly what conditions are going to be attached to such bail outs.
For example, are we going to continue, through the awarding of credit, to bail out, say, Great Britain without saying that we will help them financially only if they agree to pull in their belts and act more responsibly so far as spending is concerned?


Robert Phillip Kaplan: On a point of order, Mr. Speaker-


The Acting Speaker (Mr. Turner):: Order. The Parliamentary Secretary to the Minister of Finance (Mr. Kaplan) is rising on a point of order.


Robert Phillip Kaplan: Mr. Speaker, 1 think the hon. member knows perfectly well that if the minister were to stand up and make that kind of statement, he would be out of order because that issue has nothing to do with these amendments to the Currency and Exchange Act. If the minister would be out of order, the hon. member opposite is also out of order. He should stick to the bill and to the amendments.


Sinclair McKnight Stevens: Mr. Speaker, I can hardly believe it, but presumably the parliamentary secretary has not even read this bill. He does not seem to realize that we are dealing with the exchange fund. One of the principal assets of the exchange fund is its investment in the International Monetary Fund which in turn is being called upon to make certain credit advances to various nations of the world, including Great Britain.


Donald Stovel Macdonald: You have the wrong bill; the right speech but the wrong bill.


Sinclair McKnight Stevens: If it is not relevant to review the impact of the exchange provisions that 1 refer to, that is a very strange thing indeed.
Currency and Exchange Act


Walter David Baker: It is the parliamentary secretary; if he read it he did not understand it.


The Acting Speaker (Mr. Turner):: Order, please. The hon. member has the floor for the purpose of making a speech.


Sinclair McKnight Stevens: Mr. Speaker, to sum up, I simply feel that when the Minister of Finance is dealing with these interrelated subjects-and the two bills are interrelated, the one dealing with Bretton Woods, and this one-it is time he explained to the public and to this House the exact commitment he is entering into in some of these international forums. More and more we are being committed to bail out other countries. The time is fast approaching when we have to say to nations such as Great Britain that no further credit is available until they put their own house in order. Unfortunately under the labour government presently in power in Great Britain I do not believe that country intends to tighten its belt. In fact in The Times of October 29 a front page heading read "Chancellor Shuns More Spending Cuts". The article following explains that because of a power play among certain members of the Labour party it is likely that the spending spree in Great Britain will continue.
In short, Mr. Speaker, I think we have come to the point where the secrecy of this government and its cavalier attitude in regard to international monetary conditions and our involvement in them, have to come to a stop. The government must accept that parliament has a right to know.
This brings me back to Clause 5 of the bill to which I referred earlier, Mr. Speaker. I should like to draw the attention of hon. members to what is the proposed substitution for Section 18(2) of the Currency and Exchange Act. Clause 5 of the bill reads as follows:
(2) An annual audit of the Exchange Fund Account and of the transactions in connection therewith shall be made by the Auditor General of Canada in such manner as he thinks proper

I hope we underline those words, Mr. Speaker.
-and he shall report to the minister and the results thereof.
That is all that will happen, Mr. Speaker. We should compare what the minister wants us to accept now with what exists in the Currency and Exchange Act, Section 18(2). Incidentally, Mr. Speaker, this wording has been in the act since it came into force in July, 1935. The present act reads:
An annual audit of the Exchange Fund Account and of the transactions in connection therewith shall be made by the Auditor General of Canada in such manner as he thinks proper-
That is where the new wording ends. The existing clause states:
-with a view to ascertaining whether the transactions in connection with the account have been in accordance with this act and he shall certify to parliament-
Mr. Speaker, please note this-not to the Minister of Finance but to parliament.
-that, in his opinion, having regard to such examination, the transactions in connection with the account have or have not been in accordance with this Act, and that the records of the account do or do not show truly and clearly the state of the account.


Currency and Exchange Act
In short, Mr. Speaker, if this bill were to pass without amendment, parliament would have lost the right to have the Auditor General report directly to us concerning transactions in the exchange fund.


Some hon. Members:: Shame!


Sinclair McKnight Stevens: I think there is nothing more fundamental to this parliament than our right to scrutinize such a fund and the transactions that take place. In Clause 4 of the bill we find that the Auditor General reports to the Minister of Finance. Clause 4 reads as follows:
(2) The Minister shall include the financial statements of the account and the report of the Auditor General referred to in subsection 18(2) in the report to parliament referred to in subsection (1) of this section.
Instead of having the Auditor General report directly to us on the activities within the exchange fund, the minister has very cleverly short circuited parliament. Basically he is saying, "The Auditor General reports to me, and I in turn in my regular report under the act, will include that report." That is a very different situation from the present one, Mr. Speaker. I have pointed out that Auditors General have repeatedly included in their reports to the House of Commons a special report on the exchange fund.
In the report for the fiscal year ended March 31, 1975, the present Auditor General sets out at page 45 a statement of assets and liabilities for the Exchange Fund Account. I would draw this to the attention of the hon. minister. At page 46 the Auditor General makes a specific report to parliament. In short, Mr. Speaker, the present procedure is that the Auditor General makes a report not only to the Minister of Finance but also specifically a report to parliament. This is contained in his regular report to this House of Commons, a report to which we are entitled every year under the Financial Administration Act. The Auditor General acts under the provisions of the Financial Administration Act and his responsibilities are very clear. He has to report to the House of Commons concerning his findings.
In this connection, Mr. Speaker, I would point out that Section 18(1) of the Currency and Exchange Act shows the mischief this government is up to. That section reads:
The Financial Administration Act does not apply to the Exchange Fund Account or operations or transactions in connection therewith.
In short, Mr. Speaker, we have caught them taking advantage of the fact that under Section 18(1) the Financial Administration Act does not apply to the Currency and Exchange Act. As things now stand, Section 18(2) requires the Auditor General to report to parliament. If we pass Clause 5 of this bill, however, the Auditor General will no longer have the jurisdiction to report to this parliament because the Financial Administration Act, which he works under, does not apply to the Currency and Exchange Act. It is even questionable whether there will be any report to parliament through the public accounts, or the Auditor General's report at all. The only thing we will see will be a report presumably screened by the Minister of Finance and tabled by him in this House. We should consider the magnitude of this, Mr. Speaker. Members
[Mr. Stevens.)
of this parliament must be aroused before this bill is passed to demand an explanation of why we are asked to take away this right.
I would point out that in the Public Accounts of Canada 1976 the transactions, including the assets and liabilities of the exchange reserve accounts, are clearly set out. The exchange fund account is shown as having assets of $4 % billion. It is also set out that the foreign exchange reserve transactions in the year under review are something over $6 billion. Surely it is a very significant thing that those transactions should be properly reviewed, not merely by a screening by the Minister of Finance but by this parliament, and that we have the right to have the Auditor General continue to report to this parliament concerning his findings with regard to transactions of that magnitude.
One really should ask oneself exactly what the minister is after here. Is there something he hopes he can conceal, or does he anticipate that in the future there may be things he would just as soon not have to reveal which he would have to reveal through the reports of the Auditor General at the present time? It is very nice for the parliamentary secretary to stand up and explain that there is this provision with regard to credits and deficits over a three year period in the fund, but why should the government not be required to show the full deficit in the year in which it is incurred, or the full credit, if that is what the government is worried about. Most accounting is on the current basis. Why should there be this right to slough off the full losses we are having to live with now?
I believe there must be a serious question concerning why the bill proposes to take away from the Auditor General his responsibility which has existed since 1935 to report to this House and, second, why there is now this proposal to have this three year averaging kind of a provision. Wouldn't many businesses just love that; if there were mistakes or if they have write-offs wouldn't they love to be able to say that they do not have to report them in the immediate year but can drop them for three years!
The fact is that I believe the minister realizes we are in for a roller-coaster period and realizes he will take us more and more into the international scene where we will just have to hold on to our seats and watch the manipulations in the international monetary markets, with our commitments possibly being cut in half or to zero by countries which have to default on some of the obligations they may have to the external world. This is the reality. I believe there is no question but that we should demand that we receive full explanation and a full accounting through the Auditor General's reports right in this House and not screened through the Minister of Finance, which is what the government is cleverly trying to get through the House this evening.
The Currency and Exchange Act is an act with which most of us are quite familiar. Certainly the Bank of Canada has the immediate charge of investigating the assets of the account. I am not suggesting in any way that there is any faulty manage-


ment with regard to that account. It is well run. But I am saying that we should never at any time give up our right to have an independent Auditor General's report on those transactions in this Elouse.
In conclusion may I say it is particularly important to remember that the Auditor General in his reports over the years has been most helpful in pointing out some of the mistakes that have been made by this government. In dealing with the exchange fund the Auditor General has often pointed out that certain valuations have not been made clear and that deficits would be shown if those evaluations had been made. I refer, for example, to the report of the Auditor General for the fiscal year ended March 31, 1972, and his comments in respect to the foreign exchange reserve account. Under the foreign exchange reserve accounts the advances to the exchange fund account at March 31, 1972, amounted to $5,500,000,000, comprising cash advances from the Consolidated Revenue Account of $5,146,000,000 and special drawing rights of $370 odd million. The report states:
However, as the market value of the net investments from cash advances held by the Account at that date was only $4,928,540,000, there was a deficit of $217,460,000 which in our opinion should be written off with parliamentary approval as a cost of exchange management.
That is only one of the comments. I could read into the record several that have been made by the Auditor General from time to time concerning the activities within the exchange account. If we should pass this bill in its present form it would appear that no longer would the Auditor General be required to report back to us in parliament in respect to such transactions. I would also point out that if the Financial Administration Act is not applicable, which it is not, to the Currency and Exchange Act, this means that all the rights and privileges which exist under the Financial Administration Act will not apply to the Currency and Exchange Act.
I would recommend, before we are asked to vote on this legislation, that each member carefully review the provisions of this bill and ask himself the simple question: do we want to whittle away the right we have had to have the Auditor General specifically review the activities of this fund and report back to this parliament as an obligation? Do we want to lose that? I believe if there were an open vote in this House we would find that in no way would this bill be passed containing such a provision. I hope that before the evening runs out the minister will give an explanation concerning why he proposes to take away this right from parliament.
I would point out again that the suggestion that the Auditor General will report to the Minister of Finance and the minister of Finance will in turn include that report in his report on the fund to the House is not the answer. We have already had that provision. What I am stating is that there is no reason why we should give up the responsibility of the Auditor General to report back directly to this House in respect of the foreign exchange provisions provided under the Financial Administration Act and allow a full examination to take place in the public accounts committee of this House if it is required.
Currency and Exchange Act
I know there are other members who wish to speak on this bill. I hope to have an opportunity to speak on it more fully at a later time. I hope that members will not be lulled by the gentle little speech made by the parliamentary secretary. We have a very serious piece of legislation before us tonight and I think we are not acting as true parliamentarians if we let it slip through without getting some explanations.


Max Saltsman: Mr. Speaker, I think I should start off, initially at least, by expressing one piece of agreement with what the hon. member for York-Simcoe (Mr. Stevens) said, that it is a serious and important piece of legislation-and then we can start parting company.
I must admit that I have tremendous admiration for the self-confidence of the hon. member for York-Simcoe. Because the Canadian polls show that his party might be forming a government some time in the near future, he can hardly contain his enthusiasm and he feels he should govern Great Britain as well! I did not think that 1 would be engaging in a debate in which the shade of William Jennings Bryan and his "cross of gold" speech would be revived.
The hon. member for York-Simcoe, I think, is quite correct in his analysis when he says this is an important piece of legislation, but he might have added also that it is a very dangerous and uncertain piece of legislation, and yet the danger of acting otherwise is greater than the danger contained in this legislation.
What we are doing specifically-I suppose because it is the companion piece to the Bretton Wood's Agreement legislation-is to try to look at this bill as part of a total picture. It is an attempt on the part of the world to find some way of making sure that trade is maintained, and that countries which run into financial difficulty can be assisted without both loads of gold having to cross back and forth, or without waiting for a depression to sort things out. We have gone through that on a number of occasions. The world had bogged down completely because we were not able to devise an effective credit system in which we would help out even countries like Great Britain which had some difficulties, without suggesting that they tighten their belt before we give them any money, because what happens to Great Britain will have repercussions in this country. In the 1930's we went through the nonsense of trying to beggar our neighbour, and we destroyed each other in the process.
We have to recognize that what happens to somebody 5,000 10,000 or 15,000 miles away will ultimately affect us as well. It is a dangerous thing. There are not enough dollars around in some cases, there is not enough gold around, nor is there enough credit around. The special drawing rights have been designed as a kind of fill-in currency, perhaps some way of keeping the wheels turning and keeping things going on the basis of credit. I presume that we really do not know how well this will work out, and there is a fair amount of risk involved in dealing in this way. But 1 think this has to be done, and for that reason I am prepared to support legislation of this kind,


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although 1 want to raise some questions in committee and I feel that this bill should go to the committee so we can raise some questions on it there.
1 want to make a comment about Auditors General. We have had two different kinds. We have the present one, whom I admire greatly, and we have had one who seemed to be more politician than Auditor General. 1 am very curious about clause 5 of the bill. I have some reservations about the Auditor General reporting to the minister rather than to the House, but on looking at some of the preceding clauses I find that the difference between the Auditor General reporting directly to the House and reporting through the minister, who in turn reports to the House, including the financial statements of the account and the report of the Auditor General-it seems to me that basically the information the Auditor General is collecting will be made available to the House-is that there will not be any political comment in that report. By going through the minister, the Auditor General does not have to make any comment and perhaps he prefers not to make any comment on the state of the account and the values in that account because it is not really an accounting procedure that we are examining.
The minute we start dealing with such things as special drawing rights and foreign currencies and asking ourselves what valuation we place on them, it becomes a political decision and it should be dealt with as a political rather than an accounting decision, and if it is a political decision then the person to hold responsible is the Minister of Finance (Mr. Macdonald) rather than the Auditor General. I say this because it seems to me that this is the only reason that I can see at the moment why the government would want to change the accounting procedure from having the Auditor General report directly to the House to having him report to the minister and then have the minister report to the House. But that is something that I will want to question and find out more about when the bill is before the committee.
There is a great danger in a bill of this kind. I am sure every member of the House recognizes that when you are dealing with currencies that are fluctuating and currencies which are not really currencies, such as special drawing rights, there is a great opportunity for hiding the cost of foreign assistance or the cost of being an international good citizen, and it will be a great problem for legislators to find out to what extent we want to bail out other countries and to what extent it will be possible to find out whether in fact we are doing it and how it is being done.
I hope that when this bill gets to committee we will receive an explanation from the government on how it will proceed, and we hope the Auditor General will come before the committee. I would feel much better about letting this bill go through if we had certain assurances from the Minister of Finance, or from his parliamentary secretary, who I think is very capable-


Some hon. Members:: Hear, hear!


Max Saltsman: -because it does not bother me at all that he introduced the bill and spoke on it. I would accept assurances

from either one of them that we will have an opportunity of speaking directly to the Auditor General and asking him what his wishes would be in a case of this kind-would he prefer to report directly to the House, or would he prefer to report to the minister and have the minister report to the House? As I said, I am very impressed with the work that our present Auditor General is doing, and I would like to have an assurance from the minister that we could speak to him because the Auditor General is a servant of this House, not of the minister, and as a servant of this House we should have the right to put that question to him.
I will conclude on that note, Mr. Speaker, and say that 1 look forward to the examination of the important questions that bills of this kind raise when they go to committee.


Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, I would like to say a few words on this bill, and I hope the minister or his parliamentary secretary will be able to answer some of my questions in committee.
I notice that Clause 14(2) reads:
The minister may purchase or acquire or cause to be purchased or acquired with assets held by the minister or on his behalf for the Exchange Fund Account
(a)	special drawing rights issued by the International Monetary Fund, which
rights shall be deemed for the purposes of this Part to be securities;
1 raise this because 1 think it is most important at this time in the history of the world that we have some discussion about the role of the International Monetary Fund and about world currency. Serious questions are being raised around the world and in financial circles about the effectiveness of the International Monetary Fund and how it will function.
On October 21, as reported at page 298 of Hansard, I asked the minister about the policy of the sale of gold by the International Monetary Fund which seems to be depressing the price and which has the effect, at least in this part of the world, of reducing the value of our own reserves as well as causing unemployment in our gold centres. The minister reacted by saying that in Manila he had expressed reservations about the way the gold auctions were being conducted, but that in a general way he agreed with it.
There are those who have doubts as to the ability of the International Monetary Fund to continue in the future in the way it was anticipated to operate. Perhaps the demands upon it will be much too great. There are those who argue that removing gold as one of the main ingredients in the International Monetary Fund may have been a mistake.
In committee I hope the minister will give a complete explanation of what happened in Manila and how he sees the IMF performing in the future. We have a real interest in this because according to the general economic advisory committee of the Department of Industry, Trade and Commerce reporting on Canada's trade and balance of payments situation from 1971 to June of 1976, since 1971 Canada's current account balance has fallen from a surplus of $431 million to a deficit of nearly $5 billion in 1975. As recently as 1973 Canada had a


small current account surplus, so in fact in two years from a small surplus we have gone to a deficit of nearly $5 billion. In the first half of 1976 the deficit was slightly higher than the same period in 1975. Although it might improve as the year goes on, there are good reasons to wonder if it will improve. Grain sales are low and prices are low at this time.
Both the merchandise and non-merchandise accounts in our trade balance showed deficits. They moved from a peak of $2.7 billion in 1973 to a deficit of $639 million in 1975. There may be a small merchandise trade surplus for this year of $500 million, as forecast by the department. But what about our deficit on non-merchandise trade? It almost doubled between 1971 and 1975 from $2.1 billion to $4.3 billion. The deficit for the first half of 1976 was about $600 million higher than for the same period in 1975. The non-merchandise deficit for the year as a whole is expected to be in the neighbourhood of $5 billion.
1 think we have a significant interest in how the IMF will function. How did this problem come about? The greatest increase has been the increase in the deficit on interest and dividends from $1.1 billion in 1971 to $2 billion in 1975. The deficit on travel rose from $200 million in 1971 to $700 million in 1975.
These are some of the very important things to be discussed with regard to this bill. Two people who are not citizens of this country spoke on this subject. One was the Prime Minister of Jamaica, Mr. Manley, and the other was the American ambassador to Canada. They talked about the problem of international payments in relation to commodity prices. I suppose they reflected the two opposite interests of this world in that Mr. Manley represented the underdeveloped countries. He talked about tyranny of trade, 20 per cent unemployment, the price of manufactured goods from industrial countries rising rapidly and the price of commodities not rising and not being fixed. On the other hand, in a speech in Edmonton Mr. Enders, the American ambassador, pointed out the great problems we have with regard to commodity prices and how they will be set. I suggest that we in Canada have not talked about commodity prices that world nations, and particularly Third World countries, desire. We have not even begun to meet their demands or to discuss their demands, although I think the ambassador, as reported in the newspapers, initiated this.
If commodity prices in the Third World are raised to a high enough level to give them a sense of security and to give them what they consider their rightful market, Canada will face importing products at a much higher price than that to which we have been accustomed.
I will close my brief remarks by pointing out the important things which are facing the world at this time. The Third World countries have debts in the amount of $40 billion or $50 billion, and there seems little hope of their being able to pay them. A few minutes ago on television we saw an interview with Mr. Carter, the President-elect of the United States, with regard to what he would be able to do if the OPEC nations raised their price of oil by 20 per cent. His answer was that he did not hold out much hope that there would be very much
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which could be done. The United Kingdom is asking for $3.9 billion from the International Monetary Fund, and Mexico has just negotiated a loan of nearly $1 billion. It is now thought that the IMF does not have enough resources to cover even those loans, which are probably small compared with the demands which will be made on the IMF in the future.
In committee I hope we can get from the minister some idea of how he thinks the IMF will cope with the world situation and how he sees Canada's role in the IMF, which is a matter touched upon in this bill.
[ Translation]


Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, we are discussing this evening some amendments to a legislation, which according to the text can be entitled: The Currency and Exchange Act. On the other hand, what is suggested? Some amendments are proposed and according to the explanatory notes, I see in clause I that we will add to the currencies considered in Canadian contracts some units of account such as the special drawing rights issued by the International Monetary Fund.
Mr. Speaker, we have discussed at great length in previous years other bills dealing with the benefits of special drawing rights. However, I regret very much that this afternoon when the Minister made his statement on the bill, he refused to explain the benefits for Canada of those special drawing rights issued by the International Monetary Fund.
I have had some experience of what the Government of Canada had to contend with in the IMF. I am reminded of what happened in 1968, and what happened further back, in 1962, when I think of the problems Canada encountered in its participation in the IMF. 1 do not regret those experiences the Government of Canada underwent. I remember, in the name of international monetary sanity, and I underline sanity, the rebuke or, shall we say, the "Cry halt" which was imposed on the Government of Canada at that time. One must bear in mind the difficulties of interpreting certain statistical information and the fact that various countries, not always the same ones, behaved in a rather strange manner over the years.
I think of what happened to the Government of Canada of the 1962 epoch, when the right hon. gentleman from Prince Albert was Prime Minister, and what happened in 1968 when the Right Hon. Lester Pearson was Prime Minister. The latter had to cut short a holiday in Jamaica by reason of the most horrendous international financial bind Canada had ever known. I may say that in the spirit of the crisis then facing Canada-and it is well known that the Liberal administration of the time was defeated on the third reading of an income tax bill-the then Prime Minister who had to cut short his holiday in Jamaica asked the then leader of the opposition, the hon. member for Halifax (Mr. Stanfield), to give the government 24 hours' respite. And the hon. member for Halifax, with his intense loyalty to Canada, of which I know and which cannot


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be measured, agreed; because to him, and to me, were exposed the positions of the international financial account at the time.
We could have mounted an offensive to defeat the government; but it would have been a Pyrrhic victory. Many of those lusting for blood and many bloodsuckers, whether they were social scientists, newspaper columnists, or just plain Bob Stanfield haters, said that the hon. member for Halifax was too soft on that occasion. Mr. Speaker, I want to be on record as saying that Bob Stanfield at that time acted for Canada. There are no two ways about it. Sure, he could have carried on a guerrilla campaign within this House which might have had the support of the NDP and the Creditiste party, and particularly of the Creditiste party of that time, against a motion of general support for the government. But you know, Mr. Speaker, at that time Canada had reached the most perilous international financial status it had ever known.
To meet Canada's trade requirements and those of other countries as well, there was devised a system of international finance. Canada has no particular formula, nor particular pride of possession in this regard. Some trading partners with whom we are proud to deal run into difficulty from time to time. I am sure that all members of the House share with the Minister of Finance (Mr. Macdonald) the hope that somehow, over the years, we will so arrange our mutual affairs internationally as to avoid unnecessary international dislocations. This will not necessarily be done under this bill, in the case of Canada, or under another bill to amend the Bretton Woods Agreement.
Internationally we have had some rough passages in the past. We are going to have some really bumpy passages to negotiate in the next few years. In this regard I refer hon. members to a speech I made the other day on Bill C-15 with regard to the customs tariff. As I, and my colleague from York-Simcoe, and others in the House will show, in international trade this country is going to negotiate some really bumpy water. In his heart I think the minister agrees.
Having said that I say to the minister, and I am sure colleagues on my side of the House agree, that we will participate in any positive measure, if it is going to smooth the rough water ahead which Canadian trade must negotiate during the next few years. And when one speaks of Canadian trade one immediately says, "Yes, but the condition of our trade is reflected in the value of Canadian currency." Mr. Speaker, as I recall, a couple of years ago we went through the exercise of establishing special drawing rights. The minister is asking us to accept an amendment in Clause 1 of the bill, which is quite reasonable I think, to this effect: that in a contract, if there are to be certain, shall we say, equivalents expressed as between Canadian currency and a foreign currency, they may also be expressed in SDRs. I think that is perfectly legitimate. But there are other things which the minister must explain.
Within the general philosophy of this bill there is a greater concentration of ministerial interpretation which is for the

benefit of the government. Let us look at an example in the language of the bill. Clause 14(2) reads:
The Minister may purchase or acquire or cause to be purchased or acquired with assets held by the Minister or on his behalf for the Exchange Fund Account
I simply raise the question, why? A little further on there is a change in the language where it reads:
(b)	currency of the United States, deposits in currency of the United States held in the name of the Minister with the Bank of Canada or any bank designated by the Minister and securities of the United States;
When we look at the previous act again we say why?
(c)	such currencies as the Minister designates as freely usable currencies-
In the past it read:
(c) currencies of any country other than Canada or the United States that are freely convertible into gold or United States dollars;
Why is the designation of the minister introduced?
I then come to the point that was made by my colleague, the hon. member for York-Simcoe (Mr. Stevens). Notwithstanding my general disposition to amendments to the act to make it more administratively feasible, I cry halt. In Section 5 the Minister of Finance says that any examination of the Foreign Exchange Fund Account shall be submitted to him by the Auditor General. That is the point of no return. The Auditor General and his role have been the subject of a great deal of discussion in this House, in newspaper editorials and in academic circles. On this particular point I would defy any member on the government side of the House, from the minister down to the newest backbencher, to debate with me and my colleagues any reason why there should not be a straight, uncomplicated, and direct report on this account from the Auditor General to the Parliament of Canada.


Robert Phillip Kaplan: You're on.


Marcel Joseph Aimé Lambert: The parliamentary secretary says I am on. I will debate that with him until kingdom
come-


Mr. MacFarlane:: And it will.


Marcel Joseph Aimé Lambert: -and with the hon. deputy whip of the government, or even the chief whip on the government side. We will debate and we will keep this bill from passage in this House until we are given a satisfactory explanation as to why this particular report, which in essence comes down to the bottom line explanation of the Canadian account on international trade, is not made to all of the Parliament of Canada. 1 have heard it argued that Canada's international trade should be discussed on the basis of monthly accounts.


Coline M. Campbell: Oh!


Marcel Joseph Aimé Lambert: This is something that bothers the hon. member for South Western Nova (Miss Campbell). It is not in the realm of women. She snored in an unlikely manner.


Coline M. Campbell: I did not!


Marcel Joseph Aimé Lambert: I say to the hon. lady that there must be the strongest economic performance by Canada on all sides to meet the demands that come to us rather frequently from some of the less favoured parts of this country. Frankly we must listen to them. On the other hand, how can we respond in the appropriate manner if there is not economic strength in this country?
1 point out to some of the neophytes on the government side that in parts of the country there is good economic activity and that a dissent in these areas in the name of, shall we say, the public weal, is of no value to the country. It cannot be justified on demagogic reasons. We hear every day from the NDP that anybody who is going to make a dollar should have to sacrifice a dollar and a half in a so-called egalitarianism, even if the egalitarianism is made from the bottom of someone's trousers sitting on a bench, and not contributing one iota to the economic advancement, development, and support of this country. In other words you breathe, you demand, you get, and there is to be no differentiation in any part of the country or among individuals. That is their philosophy. I challenge the NDP to make it stick in my province, Alberta. They know how far they are getting in Alberta with that way of thinking. They know how far they will get in any part of the country-


Ralph Goodale: Is there a difference between them and red Tories?


Marcel Joseph Aimé Lambert: Oh! 1 heard somebody whisper something about red Tories. Somebody just woke up over there.


Mr. Duclos:: No wonder he was asleep!

But look, my dear friend, all that because you don't understand English. I can repeat my whole speech in French if you wish.
Well, then I shall start all over again for the benefit of some hon. members.


An hon. Member:: Your remarks are not pertinent!


Marcel Joseph Aimé Lambert: There, 1 ask you if you wish to take part in this debate?


The Acting Speaker (Mr. Ethier):: Order, please.


Marcel Joseph Aimé Lambert: Mr. Speaker . . .


The Acting Speaker (Mr. Ethier):: Order, please. Would hon. members allow the hon. member for Edmonton West to continue his remarks?


Marcel Joseph Aimé Lambert: 1 thank you, Mr. Speaker, to simply point out my rights and say that the participation of the hon. member does not bother me in the least.
Currency and Exchange Act
I ask the hon. member to listen to me. Through you, Mr. Speaker, 1 invite him to participate in this debate. I challenge him.


An hon. Member:: We participate.


Marcel Joseph Aimé Lambert: Now, Mr. Speaker, I want to invite the minister to take part in this debate, because the time which was allotted to me is nearly over.


An hon. Member:: Fine.


Marcel Joseph Aimé Lambert: Oh no! Not because of your participation, you know, because it is non existent. Listen, friend, come and pay us a visit.


An hon. Member:: People do. I did myself last summer.


Marcel Joseph Aimé Lambert: Yes, you paid us a visit, but you were not appreciated. Do come back, because your participation was so insignficant...


The Acting Speaker (Mr. Ethier):: Order. The Chair would appreciate it if the hon. member would return to the bill before us and if other hon. members would refrain from intervening.


Some hon. Members:: Hear, hear!


Marcel Joseph Aimé Lambert: I thank you, Mr. Speaker.
1 am not the least bothered by the interjections originating from my colleagues opposite, and 1 see that the new minister wants to have his say in this debate. 1 might ask a few appropriate questions while waiting for his thoughtful contribution to this debate with respect to voicing his feelings on behalf of the Parliament of Canada-and of course, 1 am thinking of the past. Now that he is a member of the Cabinet, does he share the view that the Auditor General should submit his report on the International Monetary Fund, not to this Parliament, but first to the Minister of Finance, who could then put it through ... how can I put it...

In English I would call it a fine wire sieve. I ask the Minister of State from Winnipeg (Mr. Guay) just where he thinks the Parliament of Canada would be with regard to the role of the Auditor General if we set this example, bearing in mind that there is presently on the Order Paper a bill defining, and even expanding, the role of Auditor General in relation to parliament.
We are members of parliament. 1 must bow to the hon. member for St. Boniface; he is now a member of the government. But the role of the Auditor General has always been defined in relation to parliament. To the satisfaction of members in all quarters of the House, from the hon. lady from South Western Nova all the way around this Chamber to the farthest benches, this role is being expanded. The bill before us now contains only one clause of significance. Outside of that clause it is a trashy piece of paper. I ask the hon. lady, the


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newly-appointed minister of state, and all hon. members right through to the Minister of Finance: what should be the reaction of the House to the proposal before us? I say no to this bill.


Donald Stovel Macdonald: Mr. Speaker, reference has been made this evening to the companion bill which also deals with this question of the International Monetary Fund. As the hon. member for Don Valley (Mr. Kaplan) has stated, I shall be speaking at some length on that bill which deals with some important aspects of international liquidity. The bill before us now deals only with the manner in which the exchange fund is accounted for within the context of our own institutions.
We have listened to an interesting discussion on international liquidity but unfortunately, as I said a while ago, the speech which the hon. member's research department had prepared for him was delivered on the wrong bill.
The essence of the argument made by the official opposition this evening with respect to Clause 5 is that this is an amendment motivated for the purpose of preventing parliament from better knowing the method in which the exchange fund is handled.


Some hon. Members:: Yes!


Donald Stovel Macdonald: Hon. members opposite say yes. If that is their only objection, I would point out to them that the provision which is the subject of the amendment I am proposing is, I am advised, the only place remaining in the statutes where that particular wording is used for reporting to parliament; the change is therefore being effected to make this bill consistent with all the other references within the statutes in which the Auditor General's report is called for. The critical question is: on whose motivation is this change being sought? It is alleged that the motivation is mine. May I point out to the hon. gentleman that it was the office of the Auditor General that suggested that this amendment be made.


Some hon. Members:: Oh, oh!


Donald Stovel Macdonald: Perhaps the Auditor General is wrong in doing that, although I think he is right in seeking consistency.
At this point may I refer to the remarks of the hon. member for Waterloo-Cambridge (Mr. Saltsman). I would be delighted if the committee would call the Auditor General so as to get his reflections on the proposals in the bill, and perhaps confirmation of what is the nature of the advice given me, namely, that it is at his initiative that this amendment is being made.


Ramon John Hnatyshyn: Now you are blaming the civil service. Don't you take responsibility for anything?


Donald Stovel Macdonald: That disposes of the substance of the hon. gentleman's arguments, and I should like to deal with a number of other points.


Sinclair McKnight Stevens: You are passing the buck.


Donald Stovel Macdonald: Well, Mr. Speaker, the hon. gentleman says that I am passing the buck. He has said that the Auditor General is a good and faithful servant of parliament, which he is. It is he who has recommended that this amendment be made. I, as minister, have taken that recommendation and acted upon it. It seems to me that he cannot accuse me of passing the buck or of failing to take my responsibility. I am taking that responsibility, and it can be confirmed in committee.


Ramon John Hnatyshyn: Are you now telling us where you get your advice? Is this a new precedent?


Donald Stovel Macdonald: I get advice on a great many questions from my officials. If the hon. member does not know that, then he does not know much about government.
The hon. member for York-Simcoe (Mr. Stevens) referred to that section of my Manila speech concerning the liquidity of the International Monetary Fund and the free use of currency. I point out that the reference there was to the fact that certain of the major states contributing to the International Monetary Fund, particularly members of OPEC, have not themselves freed their currencies for general use, as Canada has freed its currency. It was for that purpose that I made the comments I made in Manila.
The hon. Member for York-Simcoe raised an interesting question, which was enthusiastically concurred in by the hon. member for Edmonton Centre (Mr. Paproski), when he said that we have got to be tough with the British, that we have to make it tough for the British.


Steve Eugene Paproski: I did not say that.


Donald Stovel Macdonald: The hon. member for York-Simcoe said it and the hon. member for Edmonton Centre pounded his desk, as is his manner, and made his usual contribution to the House of "Hear, hear!" I think the hon. gentlemen would do well to refer back to the question asked by the right hon. member for Prince Albert (Mr. Diefenbaker) just two days ago, when he complained as a grievance that the International Monetary Fund was being too tough on the British. I would be interested to know what the stand of the official opposition is on this matter. Is the authoritative voice that of the hon. member for York-Simcoe or that of the hon. member for Prince Albert?


Sinclair McKnight Stevens: What is your stand?


Donald Stovel Macdonald: If the hon. member would refer to my answer the other day he would know what it is. He might do a little homework around here.
The final point I would make to the hon. members again is that the critical questions of liquidity and international transactions are covered in the other bill. I would refer finally to the opening clauses of this bill which make it possible, in terms of domestic transactions, ones under domestic law, to use the currency of special drawing rights. The remaining provisions


of the bill deal with the manner in which the public accounts for the exchange fund are kept and scrutinized. 1 would be glad to attend personally and also have the relevant officials attend-those responsible for managing Canada's international payments-in order to respond to the interests of the hon. gentleman in this respect.


The Acting Speaker (Mr. Ethier):: Is the House ready for the question?


Some hon. Members:: Question.


The Acting Speaker (Mr. Ethier):: All those in favour of the motion will please say yea.


Some hon. Members:: Yea.


The Acting Speaker (Mr. Ethier):: All those opposed will please way nay.


Some hon. Members:: Nay.


The Acting Speaker (Mr. Ethier):: In my opinion the yeas have it.
And more than five members having risen:


The Acting Speaker (Mr. Ethier):: Call in the members.
The House divided on the motion (Mr. Macdonald (Rose-dale)) which was agreed to on the following division:
(Division No. 7)
	YEAS	
	Messrs.	
Abbott	Douglas	LangAllmand	(Bruce-Grey)	LangloisAnderson	Duclos	LanielAndras	Dupras	Leblanc(Port Arthur)	Ethier	(Laurier)Andres	Faulkner	LeBlanc(Lincoln)	Flynn	(Westmorland-Baker	Foster	Lee(Gander-Twillingate)	Fox	LefebvreBasford	Francis	LeggattB6chard	Gauthier	LoiselleB6gin (Miss)	(Ottawa-Vanier)	(Chambly)Blais	Gendron	LoiselleBroadbent	Gillespie	(Saint-Henri)Caccia	Goodale	LumleyCafik	Goyer	MacDonaldCampbell (Miss)	Guay	(Cardigan)(South Western Nova)	(St. Boniface)	MacdonaldCampbell	Guilbault	(Rosedale)(LaSalle-femard-Cote	Haidasz	MacEachenSaint-Paul)	Harquail	MacFarlaneChretien	Herbert	MacGuiganClermont	Holt (Mrs.)	MarceauCollenette	Hopkins	MartinCorbin	Isabelle	McRaeCullen	Jamieson	MilneCyr	Kaplan	MunroDanson	Knowles	(Hamilton EastDaudlin	(Winnipeg	NystromDionne	North Centre)	Parent(Northumberland-	Lalonde	PearsallMiramichi)	Landers	
Adjournment Debate
Peters	Messrs. Roy	SymesPortelance	(Laval)	TessierRailton	Saltsman	TrudelRaines	Sauv6 (Mrs.)	TurnerReid	Smith	WatsonRoberts	(Saint-Jean)	WhelanRobinson	Stewart	YanakisRooney	(Cochrane)	Young-96.Alexander	NAYS Messrs. Friesen	MazankowskiAllard	Gauthier	McCainAndre	(Roberval)	McCleave(Calgary Centre)	Gillies	McKenzieBaker	Grafftey	McKinnon(Grenville-Carleton)	Halliday	MunroBaldwin	Hamilton	(Esquimalt-Saanich)Balfour	(Qu'Appelle-Moosc	MurtaBeatty	Mountain)	NielsenBeaudoin	Hnatyshyn	NowlanBrisco	Holmes	OberleClark	Horner	Paproski(Rocky Mountain)	Huntington	Pigott (Mrs.)Clarke	Knowles	Reynolds(Vancouver Quadra)	(Norfolk-Haldimand)	RitchieCrosbie	Korchinski	RondeauCrouse	Lambert	SchellenbergerDarling	(Edmonton West)	SchumacherDick	La Salle	SmithDinsdale	Lavoie	(Churchill)Ellis	Lawrence	StevensElzinga	MacDonald	StewartEpp	(Egmont)	(Marquette)Fairweather	Malone	TowersFortin	Marshall	Woolliams-64.Fraser	Masniuk


Mr. Speaker:: I therefore declare the motion carried.
Bill read the second time and referred to the Standing Committee of Finance, Trade and Economic Affairs.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Stanley Howard Knowles: Mr. Speaker, on Friday, October 22, as recorded in Hansard at page 368, I put a question to the Secretary of State (Mr. Roberts) regarding Heritage Day. In particular I asked him if the report of last session was true, namely, that at this session there would be a comprehensive holidays bill which the government would introduce and which would include Heritage Day in the month of February. The minister's answer to that question was a categorical yes. That answer was very satisfactory, and


Adjournment Debate
therefore the minister may wonder why I am raising the matter on a late show.
The reason, of course, is to be found in the answer he gave to my supplementary question. In my supplementary question I asked him whether action could be taken in time so that the first Heritage Day could be celebrated in February, 1977. His reply was to the effect that he hoped that would be the case, but he could not promise it.
The reason I am here tonight-and at this hour of the night those of us on the late show will have enough sense to shorten our questions-is to give the minister a chance to revise that answer. Surely if it has been decided by the government that Heritage Day is to be added to the list of holidays in Canada, there is no reason to delay it for another year.
Actually when Mr. Justice Emmett Hall dealt with a railway dispute well over two years ago, the possibility of Heritage Day becoming a holiday was then before us, and he gave the railway workers at that time reason to believe that the contract he was settling for them would include Heritage Day. They have missed two of them; surely they are not going to miss another.
1 believe the idea of a Heritage Day is a good one in terms of what it would recognize, and it is a good idea in this country to have a holiday in February. I was glad that the minister said the other day that the government agrees. I hope tonight he can make a short answer and say that the bill will be introduced in time so that we can celebrate the first Heritage Day in February, 1977.


Steve Eugene Paproski: We have a holiday on February 14, St. Valentine's Day.


John (Moody) Roberts: Mr. Speaker, the hon. member for Edmonton Centre (Mr. Paproski) recommends February 14 as a national holiday, which I would gladly support, not only because it is St. Valentine's Day but also because it is my wife's birthday.


Some hon. Members:: Hear, hear!


John (Moody) Roberts: I appreciate not only the brevity but the eloquence of my friend from the other side of the House. Considerable interest has been shown by members in all parties in this subject in the past. I could refer to the hon. member's bill which he has presented. Other bills have been presented, one proposing the creation of a flag day, one to establish discovery day, one from our distinguished colleague from Prince Edward Island who had the ambition to create a holidy to honour Sir John A. Macdonald, and one from my colleague, the hon. member for Windsor-Walkerville (Mr. MacGuigan) who has often spoken eloquently about the desirability of establishing Heritage Day some time in February.
It is true, as my answer to my hon. friend indicated, that we do plan to proceed with legislation so that hon. members may have the opportunity to make their views known to us about this matter and to vote on it in the House. I must confess that there have been members who have expressed to me the
[Mr. Knowles (Winnipeg North Centre).}
consideration that, in an era of restraint and at a time when all of us are extremely conscious of the necessity for belt-tightening not only in the government but in the private sector, it may not be the right moment for doing this extremely desirable thing. Those sentiments have not deterred the government nor have they deterred me from bringing a measure forward, but it is because there seems to be some indication that there may be some controversy or desire on the part of members of the House to discuss the matter, that I cannot give the assurance to the hon. gentleman that 1 would like to give him that some time in February he and I together will be able to celebrate this splendid occasion, a holiday in the midst of that grim month of February which seems to last almost into infinity in the middle of the long Canadian winter.
As I said to him, I want this to happen and I wish I were in a position to guarantee that it will happen, but in this matter I am at the disposition of members of the House. Some of them have expressed some reservations. I hope they can be overcome. Our plan is to bring the bill before hon. members as quickly as we can so that they can give us the benefit of their views. I hope they will agree with the hon. member and myself that this is something we should do quickly, but it would be a very brave minister indeed who felt that with such notice he could commit the intention of the House of Commons-


The Acting Speaker (Mr. Ethier):: Order, please.


Stanley Howard Knowles: Give us the chance.


NATIONAL DEFENCE-FAILURE TO REINSTATE WILLIAM BIGGS-REQUEST FOR INQUIRY
Mr. Allan B. McKinnon (Victoria):: Mr. Speaker, Mr. William Biggs, a retired army captain having served 25 years with the Canadian forces, was from 1970 to 1974 a civilian employed by Canadian Forces Europe, holding the position of manager of the automobile transaction office in Lahr, Germany. In November, 1974, Biggs without warning was locked out of his office and suspended. He was accused by the Canadian forces of, among other things, fraud, misappropriation of funds, and falsification of accounts. On December 20, 1974, he was fired.
On December 1 of that year while still under suspension Biggs wrote to the Commander, Canadian Forces Europe, requesting a military hearing and access to the ATO files in order to prove his innocence. From that time he has written numerous letters of grievance to his military superiors; to date none of them have been answered except by form acknowledgments of receipt. He was, however, told in February, 1975, by Major General Quinn, Commander of CFE, in answer to a point by point rebuttal written by Biggs, that Biggs' redress of grievance would be answered when the investigation was complete. Nothing further has been heard from General Quinn except that in a letter to Mrs. Biggs, in response to an appeal on her husband's behalf, General Quinn stated that he considered the matter closed.


Immediately after being suspended, a radio announcement was made on the Canadian radio station that the ATO office was closed temporarily due to the results of an audit showing certain discrepancies in its books. The entire community in Lahr was, and still is, under the impression that Mr. Biggs was caught with his hand in the till. In truth there was no audit made before that time. The special investigation unit of the Canadian forces investigated the charges against Mr. Biggs and turned their reports over to the German civil authorities. Mr. Biggs was prosecuted in a German court. On January 27, 1976, his case was heard in the Lahr county court. He was acquitted of all charges against him, and in addition the judge said:
In the course of the hearing the accused has proven himself to be a man of honour, whose seriousness and integrity are not doubted, the reproaches that were raised against him have proven to be absolutely unfounded.
Even the state prosecutor, after he had heard some of his own evidence, requested a dismissal of the charges. The evidence was taken and the case dismissed. Mr. Biggs, of course, expected to be reinstated if found innocent, but this has not happened, and he has instead been informed that the military consider the case closed.
The conduct of this case involves many disturbing and unjust procedures. At no time was he given a clear statement of the allegations against him. The letter of termination includes four paragraphs of charges; these paragraphs state that he did certain things either dishonestly or negligently, but they do not specify the exact transactions referred to and are extremely vague with respect to his exact offences. One of the reasons for this vagueness is undoubtedly that although the letter suggests he may have been dishonest, dishonesty is a ground for firing an employee in Biggs' position only if it is admitted or proven. As it was, neither of the allegations was framed as "unsatisfactory work performance."
Letter after letter from the military personnel stated that his grievance could not be dealt with until the Germans had completed their case against him. Yet no one from the Canadian forces was present at the German trial and, after its completion, no action was taken in response to Mr. Biggs' letter of grievance.
In conclusion, the letter of termination of December, 1974, indicates that Mr. Biggs was either dishonest-and he was entirely cleared of charges of dishonesty by a German county court-or grossly negligent. If in fact Mr. Biggs was incompetent, one would have thought that it might have been discovered some time in his 25 years of military service, or in his four years' service with the automobile transaction office, rather than in the middle of an investigation resulting in trumped up charges which were dismissed in court. In addition, the way in which Mr. Biggs was fired left a cloud hanging over his head. His reputation in the community in which he lives is now that of a dishonest man, and he has for the last two years been unable to find another job. The destruction of a man's reputation and of his ability to earn a livelihood surely requires that he have the opportunity at the
Adjournment Debate
very least to answer specific allegations and a chance to restore his good name.
Mr. Biggs has been tried and found innocent but, despite this, has been savagely punished. This is a travesty of basic Canadian justice and fair play.
I point out to the minister that the Canadian Bill of Rights
states, in Part I:
... no law of Canada shall be construed or applied so as to ... deprive a person of the right to a fair hearing in accordance with the principles of fundamental justice for the determination of his rights and obligations.
To illustrate how fundamental the justice is which is being denied to Mr. Biggs, I also point out that Magna Carta states:
No free man shall be seized . .. nor will we condemn him ... excepting by the legal judgment of his peers, or by the laws of the land.
The minister is new at this job, up until now I have always considered him a fair man. I am aware that there has been a "closing of the ranks" on this subject in his department where, of course, the only advice he can get is from the people who instituted or confirmed this outrageous course of action. I have made available to the minister a very brief summation of the facts, as obtained by an independent source. It is now up to him to show the stuff he is made of and to institute an independent inquiry into this very disturbing matter.


Mr. Maurice A. Dionne (Parliamentary Secretary to Minister of National Defence):: Mr. Speaker, the minister has asked me to thank the hon. member for his interest in the case. I wish to assure the hon. member that the minister is personally investigating the matter. I am sure the hon. member will appreciate that the minister has been in charge of the department only for a couple of days and obviously has not had chance to investigate all documents and facts pertinent to the case. The minister would also wish me to thank the hon. member for making available to him a summary of the facts, which he mentioned a few moments ago, facts which he will want to examine closely.
The hon. member himself used expressions such as "disturbing aspects", "trumped-up charges", savagely punished" and "travesty of justice". If such terms represent the feelings of the hon. member and of Mr. Biggs, then it is all the more important for the minister to look carefully at the case, if he is to make a fair and honest determination. The minister has authorized me to assure the hon. member that after he has had an opportunity of reviewing the entire case, he will report his findings to the hon. member personally.


REGIONAL ECONOMIC EXFANSION-REASON FOR FAILURE TO MAKE CHANGES TO INCENTIVES ACT
David Samuel Horne MacDonald: Mr. Speaker, on the second or third day of the present session of parliament I raised a question concerning possible amendments to the Regional Development Incentives Act. Numerous suggestions have been made by advisory bodies to the minister, by provincial governments, and other independent bodies with respect to this particular act.


Adjournment Debate
One would have expected to have seen in the recent Speech from the Throne an indication that the Department of Regional Economic Expansion had been dealing in specific terms with some of the improvements and modifications that many Canadians now feel will be necessary if the basic task of assisting and developing industry in regions of economic and social disparity is to be accomplished.
Frankly I was surprised in the first instance that there was no reference in the Speech from the Throne to this matter. 1 was even more surprised and disturbed when I raised the question in the Elouse on October 13 with the Minister of Regional Economic Expansion (Mr. Lessard). In his answer with regard to the lack of any indication in the Speech from the Throne and whether there was any recommendation to his cabinet colleagues on this matter and whether they had turned it down, the minister said, and I quote:
Mr. Speaker, no recommendations have actually been made to cabinet at this point by myself or my department because we are now considering as we have done in recent weeks several representations made by various Canadian organizations on the ways to amend the act. I do hope that in the months to come we will be able to reach a consensus in that respect. I would then be in a position to submit to my colleagues in cabinet the amendments that will prove appropriate to meet the needs.
I find this a disturbing answer from a minister who represents a department that claims to be specifically interested in and charged with the problems of economic and social disparity in the various regions of the country.
I realize that the Regional Development Incentives Act is not the major component in the expenditures of this department. It occupies only 20 per cent or less of the department's budget. Much of the money goes into the kind of infrastructure programs that are under the general development agreement and subsidiary agreements with the various provinces.
What is disturbing is that the recommendations that have been made for some time now have virtually been ignored to this date by the minister and his officials. Since 1973 the minister has had a draft report from the Atlantic Development Council. It was published this year. I quote from the report:
The evidence to date and the trends with respect to offers and applications suggest that unless significant changes in policy and its applications are made, the program as far as the Atlantic region is concerned will not achieve further momentum, but on the contrary, may significantly run down.
The minister has had that advice before him, presumably, for three years. It is not the only report that has been made available to the minister, first from his own advisory group and also from independent studies, some of which have been considered by the regional development committee of this House. The ADC report went on to say, and I quote:
As a result of RDIA in Atlantic Canada, 'an average of only one new project per year had entered commercial production in the region that possibly would have located elsewhere'.
In addition, major concern has been expressed by independent studies and members on both sides of this House with regard to the amount of ministerial discretion and latitude that exists concerning the approval of project applications.
As far back as June 20, 1972, the hon. member for Kenora-Rainy River (Mr. Reid) asked for the expedition of grants and
(Mr. MacDonald (Egmont).]
demanded less completed work before making payment. Indeed the Liberal party policy convention in 1975 called for the elimination of DREE red tape. There are a number of points that have been made. There is not time this evening to quote all of them.
On December 5, 1975, the hon. member for Halifax (Mr. Stanfield) suggested RDIA should not use uniform standards across the country. The Canadian Council on Rural Development, an advisory body to the minister, in 1969, as well as the Atlantic Development Council in its report published this year, called for more industrial intelligence and post-incentive assistance.
Of greater importance, however, are suggestions that have been made not only by advisory bodies but by provincial governments with regard to the universal coverage of RDIA. Concern has been expressed from the outset.
I recall being a member of the regional development committee in 1969 reviewing the initial legislation and being concerned about the application of this act to service industries. Representations have certainly been made by provincial governments and, in one instance, by the four ministers of tourism in the Atlantic provinces with respect to the importance of RDIA amendments in relation to the tourist industry. In addition, the former minister of regional economic expansion, now Secretary of State for External Affairs (Mr. Jamieson), indicated there might well be three or four amendments dealing with bridge financing, a matter of great importance in the establishment of new industries in economically deprived areas.
I suppose that in the short time available to me I should draw attention to what is a major concern of those of us who have been studying the effects of this act, that is, the difficulty of defining an effective goal and strategy with respect to the federal program of industrial assistance. The Atlantic Council, in a recent report, has stated that from the outset there has never been a clearly defined industrial strategy to which the RDIA would apply. This view was expressed also in a number of independent studies. After seven years it is far too late for the minister to tell us that the government has just begun to study recommendations which have been well-known for years. It is high time some action was taken and it is my hope that the government will act to bring about long overdue amendments to the Regional Development Incentives Act.


Mr. Ed Lumley (Parliamentary Secretary to Minister of Regional Economic Expansion):: Mr. Speaker, 1 was pleased to note from the question asked during the queston period on October 13 by the hon. member for Egmont (Mr. MacDonald) that he recognizes the importance of the Regional Development Incentives Act as a tool for implementing regional development policy. This is a view which I personally share with him and one which is held by many other groups as well, including provincial governments and the Atlantic Development Council.


In his question the other day the hon. member referred to recommendations made by the Atlantic Development Council as an advisory body to the Minister of Regional Economic Expansion (Mr. Lessard). I assume he is referring specifically to the recommendations contained in a study published by the Council in May, 1976, which relates to activity under the program during the period from 1969 to 1972.
That study did indeed make recommendations for improving the effectiveness of the regional development incentives program. There are, however, two important points that I would like to make in this regard.
First, the council noted that-and 1 quote from the report:
"The incentives program in the Atlantic region has been a useful source of financial assistance for industry and has brought a welcome contribution to the growth of employment".
Therefore, even on the basis of early and limited experience with the program, the council study revealed that the program was proving effective.
Second, and perhaps more important, the Council recognized in its report that its recommendations had been "taken into account in the formulation of a number of changes in departmental administration and in the operation of the RD1A program itself." In other words, the council recognized that the department had, on its own initiative, undertaken a policy review of the regional development incentives program and had adopted many of the changes proposed by other bodies including provincial governments and the Atlantic Development Council itself. The decentralization of decision-making and the introduction of standard formulae for certain types of incentives projects are two examples of the recommendations made by the council which were adopted by the department.
Adjournment Debate
Although this major review of the incentives program was undertaken in 1972 and 1973 and changes were initiated in 1974, this is not to say that we are now content with the program and will make no further changes to improve its effectiveness. In fact, as my minister said the other day in response to the question from the hon. Member for Egmont, we are constantly reviewing the on-going operation of the incentives program and continually considering ways and means by which it can be made a better tool for fostering economic expansion and social adjustment in disadvantaged regions of the country.
In this regard, it will be remembered that only last year parliament approved an extension to the act from 1976 to 1981. That extension permits the continued provision of incentives to industry of all sizes, including small businesses where increased emphasis was made possible as a result of the program changes in 1974. It will also provide an opportunity to consider the representations of various Canadian groups and to determine how the government's and the department's objectives can best be met and what, if any, amendments to the Regional Development Incentives Act will be required during that period.
I hope these remarks will help to clarify for all concerned the actions taken recently by our department in relation to the incentives program and our intentions with regard to this program in the future.


The Acting Speaker (Mr. Ethier):: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 11 a.m.
Motion agreed to and the House adjourned at 11.47 p.m.

Friday, November 5, 1976