1976-11-30

ROUTINE PROCEEDINGS


Mr. Steven E. Paproski (Edmonton Centre):: Mr. Speaker, 1 rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43. In view of the lack of consultation with the city of Edmonton with regard to the economic impact and the relocation costs of the Canadian airborne regiment, which will entail 1,200 worthy Edmonton families being moved to Petawawa, I should like to move, seconded by the hon. member for Victoria (Mr. McKinnon):
That this House direct the Minister of National Defence to reverse his decision.


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


Some hon. Members:: No.


POLYSAR
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I rise under this provision of Standing Order 43. Yesterday in the House the Minister of Finance informed the House, with reference to the peculiar financial activities that a Crown corporation was involved in with Swiss bank accounts, that the auditing firm of Peat, Marwick and Mitchell had advised the Canada Development Corporation that "there was no illegality involved" while Mr. Gordon Cowperthwaite, a senior partner in the same firm said yesterday that it is not up to them to say whether there was tax evasion or not-whether the transaction is intended to result in tax evasion or foreign exchange control evasion is not the responsibility of the auditor as such.
I move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That the Minister of Finance make a statement on motions explaining why he informed the House yesterday that the auditing firm of Peat, Marwick and
Mitchell had informed the Canada Development Corporation that there was no illegality involved in the peculiar transaction when in fact the senior official of the firm stated publicly that they made no such statement.


Mr. Speaker:: Order, please. 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:: No.


PUBLIC SERVICE
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, the proposals in the motion I am about to move will greatly relieve the minds of many public servants, especially in Ottawa. That is why I seek to move it under Standing Order 43. 1 move, seconded by the hon. member for Nanaimo-Cowi-chan-The Islands (Mr. Douglas):
That this House urges the government, in connection with its policy of the decentralization of certain government departments, to increase the opportunities for public servants who need or prefer to remain in Ottawa and transfer to other departments by reconsidering the bilingual requirements in such cases, and also to facilitate early retirement by lessening or removing the penalty factor so far as superannuation is concerned in the case of public servants who choose to retire because their departments have been transferred.


Mr. Speaker:: Order, please. Such 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.


SUGGESTED DEVELOPMENT OF COAL MINES IN ATLANTIC PROVINCES-MOTION UNDER S.O. 43
Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I rise on a matter of urgent and pressing necessity pursuant to the provisions of Standing Order 43. In view of the accelerating devaluation of the Canadian dollar on the one hand and threatened price increases by OPEC nations on the other for petroleum products, which conditions will greatly contribute to the cost of subsidizing off-shore oil imports and place additional burdens on the economy of Atlantic Canada, I move,
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November 30, 1976
Oral Questions
seconded by the hon. member for St. John's West (Mr. Crosbie):
That the Minister of Energy, Mines and Resources again consider and act upon the suggestion 1 made over three years ago in this House, as reported on page 7615 of Hansard, that emergency measures be taken to develop the coal mining industry in eastern Canada to lessen the burden of imported petroleum products, which would at the same time strengthen the local economies by the utilization of labour intensive industry which has enjoyed past successes in this region of Canada.


Mr. Speaker:: Order, please. Such 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.


EXTERNAL AFFAIRS
Mr. Andrew Brewin (Greenwood):: Mr. Speaker, I, too, wish to move a motion under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. Jane Phakothi and Joyce Seroke, the president and national secretary of the world affiliated YWCA of South Africa, have been detained without charge in that country, solely, apparently, because they are Christian leaders who have opposed the government's apartheid policy. 1 therefore move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That in accordance with often expressed Canadian abhorrence of apartheid this House requests the Secretary of State for External Affairs to protest to South Africa's ambassador to Canada this breach of fundamental human rights.


Mr. Speaker:: Order, please. The provisions of Standing Order 43 require the unanimous consent of the House for the presentation of such motion. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, my question is for the Minister of Finance. In view of the unplanned drop of our dollar which fell below 96 cents this morning in relation to the United States dollar, a five cent drop in a week, would the minister indicate if news reports in New York are correct when they state that the Bank of
[Mr. MacKay.J
Canada has used substantial amounts of our United States dollar reserves to support the Canadian dollar within the last three or four days, to prevent the Canadian dollar from falling to still lower levels? If so, would the minister indicate to what extent reserves have been so used?


Hon. Donald S. Macdonald (Minister of Finance):: Mr. Speaker, it is the policy of the Bank of Canada to intervene from time to time with price movements of the dollar, in order to maintain an orderly market. The state of the foreign exchange fund is reported on after the end of each month and the current state will be reported on at the end of this month. It has also not been the policy to disclose on a day to day basis the particular amount of intervention. For that reason I would prefer not to comment to the House at this point, although this information will be available within the month.


DROP IN VALUE OF CANADIAN DOLLAR INSTRUCTIONS TO BANK OF CANADA REGARDING SUPPORT
Sinclair McKnight Stevens: A supplementary question, Mr. Speaker. Since the minister indicated that the Bank of Canada has been intervening in the dollar market, would he indicate what current instructions he has given the Bank of Canada which acts as the agent with respect to the foreign exchange account, with particular emphasis on the current activity in the Canadian dollar.


Donald Stovel Macdonald: Mr. Speaker, the instructions of long standing, as I just indicated, are that the bank should act for the purpose of maintaining an orderly market, a smooth change in the market, but that of course we would accept to let the Canadian currency go to whatever level international trading would take it. In other words, we would not seek to peg it at any particular level but would rely on the float.


Sinclair McKnight Stevens: Mr. Speaker, I have a supplementary question for the Minister of Finance. As I believe it will be Thursday when the month's figure will be published revealing to what extent our reserves have been used, would the minister indicate whether he is prepared now to appear before the Standing Committee on Finance, Trade and Economic Affairs with respect to Bill C-5, a bill proposing amendments to the Currency and Exchange Act and, if so, when may we expect him to appear before the committee to make a statement concerning this very important question and to answer questions, or would he prefer to make a statement on motions in the House at the earliest possible opportunity?


Donald Stovel Macdonald: Mr. Speaker, I think it has been the long standing position of ministers of finance not to make statements on the change in value of the Canadian dollar on the exchange markets, and I think it would be unwise under the circumstances to depart from that policy.
November 30, 1976


DROP IN VALUE OF CANADIAN DOLLAR- EFFECT ON INVESTMENT
Hon. Robert L. Stanfield (Halifax):: Mr. Speaker, my question is for the Minister of Finance. Is the minister not concerned that the reduced confidence in the Canadian dollar would reflect itself also in reduced confidence among investors in Canada, both international and Canadian investors, with deep economic consequences for Canada resulting from a reduction in the rate of investment including an increase in unemployment?


Donald Stovel Macdonald: Several possible conclusions can be drawn from the drop in value of the Canadian dollar. It has been anticipated, both at home and abroad, for some time that there would a readjustment downward in the Canadian dollar when the heavy calendar of borrowings, particularly by provincial institutions, was finished this year. To the extent that there has been the expected readjustment downward, I think one might expect that foreign investors, seeing an expected stability in the dollar rate, might not be deterred from investing in Canada. On the other hand, of course, I think we must be concerned about the possible impact of political events in Canada, and indeed about the rate of inflation on the continued confidence that foreign investors will have in this country. I will be conscious of that in any policy I put forward.


DROP IN VALUE OF CANADIAN DOLLAR-MEASURES TO RESTORE CONFIDENCE
Robert Lorne Stanfield: In view of the sharp decline of the dollar-and I hope the minister is right in suggesting, as he seemed to be suggesting, that this will be brought about quite quickly, although there is no reason that we can see here to believe that at the moment-does the minister intend to take any new initiatives, in the light of this display of lack of confidence in the Canadian economy, to restore confidence in the economy and indeed in the integrity of Canada-and by "initiatives" I assure you I am not implying the suggestion that Ed Schreyer and I should be invited to join the government-or whether he intends to stand pat, as he indicated he was going to do when he last made a statement in the House a week or so ago?


Donald Stovel Macdonald: It is not
evident to me that any initiatives that might be taken-for example, by stimulating the domestic economy and stimulating the domestic demand-would necessarily produce a more favourable reception of the Canadian dollar or Canadian investments abroad. It seems to me that probably the most effective policy to be pursued is that to which the government has given priority, that is to reduce the rate of inflation. That continues to be the policy.
Oral Questions


POLYSAR
John Edward Broadbent: Mr. Speaker, I have a question for the Prime Minister. In a letter dated March 27, 1973, tabled in the House on Friday, certain financial transactions of a nefarious nature practised by Poly-sar involving Swiss bank accounts were described by the Prime Minister as being either embarrassing or potentially illegal. Since, as we have learned over the weekend, the activities he was describing in that letter are still continuing I should like to ask the Prime Minister whether it is his view and the view of the government that these activities should continue.


Right Hon. P. E. Trudeau (Prime Minister):: If the hon. member is referring to practices which are acceptable legally and acceptable from an accounting point of view, I understand this is what will be discussed before the Public Accounts Committee. I see no way of suggesting that these practices cannot and will not continue unless the House and the government want to take a position contrary to that of the former auditor general, Mr. Henderson, who said that of course if Crown corporations are going to do business it is natural they should proceed in this way. The House might want to address itself to the question whether we want the Crown corporations to continue to be involved in business or whether they should all be privatized, a course which I imagine would be contrary to that of the Socialist party opposite.


John Edward Broadbent: Since the senior partner in the auditing firm involved in looking at the books of the corporation under discussion categorically denied any claim that the firm had said there was no illegality involved and went on to say that from the point of view of his company whether or not the transaction was intended to involve tax evasion or foreign exchange control evasion is not the responsibility of the auditor as such, I should like to ask the Prime Minister, since there is every assurance by every rational observer in the world that the only purpose of transactions of this kind could be tax evasion of some kind or some other illegal or immoral activity, whether he does not think it is the government's responsibility, particularly as it pertains to the Crown corporations, to put an end to this kind of practice?


Pierre Elliott Trudeau: The hon. member is asking for an opinion which I believe I gave in my first answer to him this afternoon. Insofar as what the senior partner of an accounting firm has said, I do not know what he said. I understand the hon. member is reading from a newspaper. It does seem contrary to the advice the Minister of Finance received and contrary to the opinions I received, too, that Peat, Marwick had indeed been consulted and felt that from an accounting point of view these were customary accounting practices and, of course, from a legal point of view, these are perfectly legal. This is based on a great deal of hearsay on my part and on the hon. member's
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November 30, 1976
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part and that is why the government is very willing to see this matter discussed with the witnesses themselves before the Public Accounts Committee. I think it would be better to pursue that route than to quote hearsay from a newspaper.


Some hon. Members:: Hear, hear!


John Edward Broadbent: The report was not only in the newspaper. It was on the air waves as well.


Some hon. Members:: Oh, oh!


John Edward Broadbent: He categorically denied the claim made to the House by the Minister of Finance yesterday-the Prime Minister was out on that little ruse, but I will be back on that tomorrow. Since other companies in West Germany and the United States competing on world markets have said they do not practice the kind of behaviour which has now been documented and attributed to Polysar, does the government of Canada think that we as a country should be setting the lowest possible standards for international trade?


Pierre Elliott Trudeau: I kind of resent the hon. member suggesting that I am looking for an "out" through a ruse. Surely, it is good common sense to suggest that instead of arguing from material in a newspaper or over the air waves, we should hear directly from the people involved. Surely, that is not said in order to evade the question. It is obvious that the hon. member is receiving information contrary to that I personally received, to the effect that Peat, Marwick found nothing wrong with this accounting practice.
As for what happens in Germany or points east of that, I have no knowledge either but my opinion has been given to the House in the answer to the first question. If it is legal and acceptable business practice, then we have to make up our minds whether we want Crown corporations to exist which have corporate and commercial enterprise as their object. If we want to depart from what are acceptable business, accounting and legal practices in the name of some ethical standard which we may well want to apply, I suggest that we should get out of the business of having Crown corporations. I must make the point on illegality very clear. If there is anything illegal, indeed if there is any form of bribery, the government would take very strong objection to it and would see that it did not happen.


John Edward Broadbent: Including tax evasion?


Pierre Elliott Trudeau: I said that if there was any illegality the government would want to know.

[ Translation]


CANADIAN NATIONAL RAILWAYS
Mr. Eudore Allard (Rimouski):: Mr. Speaker, my question is directed to the President of the Treasury Board.

Is the minister in a position to say whether he has received correspondence from the brotherhood of the CN employees asking for reopening of pension plan file No. 59? If so, when will he give his approval and sign that document?


Mr.   Jacques-L. Trudel@Parliamentary Secretary to President of the Treasury Board: Mr. Speaker, I do not think there is such correspondence in the department, but I will inquire and if it has been received I will advise the hon. member.


GOVERNMENT ADMINISTRATION
Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, I have a question for the Prime Minister.


Some hon. Members:: Hear, hear!


George Harris Hees: The natives again seem to be restless, Mr. Speaker. They seem to sense that the lion is poised for the fray. My very straightforward question is this. Is it the policy of the government, which requires Canadian companies to operate strictly within the laws of this country, to allow Canadian Crown corporations to issue false invoices to companies in other countries so that these companies can avoid paying legal taxes to their government and thus break the laws of their country? If the Prime Minister believes that that is satisfactory practice, does the Prime Minister consider it satisfactory practice for Canadian companies to try to obtain false invoices from abroad so that they can avoid paying legal taxes in this country?


Pierre Elliott Trudeau: Well, Mr. Speaker, I must earnestly point out that the premises of the question are completely false, including the premise that the lion has teeth which are as strong as his roar.


George Harris Hees: Mr. Speaker, my supplementary question is this. Once again, as so often happens, the Prime Minister seems to lack the courage and integrity to answer a simple question.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Order, please. I would be very pleased to hear the supplementary question of the hon. member for Prince Edward-Hastings.


George Harris Hees: Does the Prime Minister consider that the example that he is setting for business morality in this country, urging that it is perfectly satisfactory to obtain false invoices and thus avoid taxes, is a good kind of business morality to set forth for the country to follow?
November 30, 1976


Mr. Speaker:: Order, please. That is essentially a repetition of the previous question.


George Harris Hees: 1 never got an answer.



FINANCE


Mr. Gordon Towers (Red Deer):: Mr. Speaker, my question is for the government House leader in the absence of the President of the Treasury Board. In view of the investigation being conducted by Mr. Gerald Stoner, Deputy Minister of Industry, Trade and Commerce, into a matter relating to the Canadian Imperial Bank of Commerce which could have serious consequences, while at the same time Mr. Stoner, as a member of the Royal Commission on Financial Control and Accountability, works under the chairmanship of Mr. Allen Lambert, President and Director of the Toronto Dominion Bank, has consideration been given to the possible unfair treatment to which the former bank could be subjected?


Hon. Allan J. MacEachen (President of the Privy Council):: Mr. Speaker, that question is much too complicated for me.


Some hon. Members:: Oh, oh!


Thomas Gordon Towers: Mr. Speaker, my supplementary question is directed to the same minister. Due to the complex situation in which both the Canadian Imperial Bank of Commerce and Mr. Stoner are placed, would the government take another look at the membership of the royal commission?


Allan Joseph MacEachen: Mr. Speaker, I will take notice of this and the earlier question and, through the acting minister or his parliamentary secretary, I will provide any appropriate information that may be produceable.



SUPPLY AND SERVICES


Mr. Allan B. McKinnon (Victoria):: Mr. Speaker, my question is for the Minister of Supply and Services who has crossed over to our side of the House.


An hon. Member:: Oh, no!


Allan Bruce McKinnon: Now that he has gone back, 1 have a question for the minister arising out of his reply to me on October 29 concerning payments made to the Northrop Corporation. The minister maintained that only about $6 million had been handed over to Northrop, and that this was money
Oral Questions
which had been previously withheld. The minutes of settlement of the case which are filed with the Federal Court show that the government agreed to pay some $9 million to Northrop, and this amount, less withholding tax, was actually paid. Will the minister explain the discrepancy between his answer and the minutes of settlement?
[Translation}


Hon. Jean-Pierre Goyer (Minister of Supply and Services):: Mr. Speaker, it is quite simple. I think my answer was clear. Those were funds we had held until the case was settled by the court. Finally, in consultation with Northrop, we found a common ground for agreement and we released the money that was being held, plus an additional sum we paid Northrop in recognition of its services.



SETTLEMENT WITH NORTHROP-REASON FOR FAILURE TO FOLLOW DIRECTIONS OF JUDGE

Allan Bruce McKinnon: Mr. Speaker, in this case the government sought a judgment of the court for the payment to Northrop of about $2 million, representing the difference between the money which had been withheld and the sum which had been agreed upon in the minutes of settlement. Since the associate Chief Justice of the Federal Court dismissed the government's motion on the grounds that this would circumvent parliamentary control of expenditures, will the minister tell the House why the government did not follow the direction indicated by the learned judge?
[ Translation]


Jean-Pierre Goyer: Mr. Speaker, after preliminary proceedings, we found that it was possible to reach an agreement with Northrop. I had initially refused to accept a settlement without going to court because officials of the Department of Justice advised us not to do so, and also because we would probably have been criticized for not taking the legal way. So we went to court and finally reached an agreement. We asked the court to approve the payment. The judge refused to do so, feeling it was not his prerogative. He was free to take that position. The Department of Justice was of a different opinion. In any case, everything was done legally and the judge did not have to make a judgment since the proceedings had not reached that stage.



SETTLEMENT WITH NORTHROP-REASON FOR CANADAIR'S CONTRIBUTION TO SETTLEMENT

Allan Bruce McKinnon: Mr. Speaker, perhaps the Minister of Supply and Services with the assistance of the Minister of Industry, Trade and Commerce could clear up a final point in this regard. Could they tell the House why Canadair paid $85,000 toward the government's over-all settlement of $9 million paid to Northrop in view of the fact that Canadair was not a party to the litigation, and, indeed, had

November 30, 1976
Oral Questions
been promised two-thirds of any money which the government collected as a result of its counterclaim against Northrop?
[ Translation]


Jean-Pierre Goyer: Mr. Speaker, perhaps I could answer for the minister.



EXTERNAL AFFAIRS


Mrs. Ursula Appolloni (York South):: Mr. Speaker, my question is for the Prime Minister. Will the government consider setting aside a day for a debate on foreign policy relating particularly to implementation of the "Third Basket" area of the Helsinki agreement under which the signatory countries had agreed to the protection of vital humanitarian rights such as family reunification and freedom of religion?


Pierre Elliott Trudeau: Mr. Speaker, 1 did not hear part of the question but I think I have the gist of it. In view of the Helsinki conference to be held sometime in the coming months in Yugoslavia, I believe, we will at that time certainly not fail to pursue the substance of the "Third Basket" which, as the hon. member knows, was something that was put into the Helsinki agreement at the insistence of the Canadian government. We are very much concerned with making the content of that basket a reality in all dealings with countries of the Soviet bloc.



DOCUMENTATION OF FAILURE OF SOVIET UNION TO ADHERE TO HELSINKI AGREEMENT-POSSIBILITY OF BILATERAL NEGOTIATIONS

Hon. Martin O'Connell (Scarborough East):: Mr. Speaker, my supplementary question is addressed to the Secretary of State for External Affairs. Will the minister prepare a dossier to present to the Belgrade conference scheduled for June, 1977, reviewing the implementation of the Helsinki agreement setting out the failure of the Soviet Union, so far as Canada is concerned, to live up to the human contacts section of the agreement which provides for favourable response to applications for travel visas to permit visits among members of families, and further will he consider a bilateral negotiation with the Soviet Union, as provided for in the agreement, to establish mechanisms to overcome the present barriers to such family visits between Canada and the U.S.S.R.?


Hon. Donald C. Jamieson (Secretary of State for External Affairs):: Mr. Speaker, a good deal of work is already underway with regard to the preparation of all forms of documentation leading up to the Belgrade conference next year, so I think that satisfies the first part of the hon. member's question. In so far as bilateral talks with the Soviet Union are concerned, here once again I can answer in the affirmative because these talks are continuing and, indeed, as I indicated to the House some-

time ago, we have been making representations pretty steadily over the last several months. Whether or not any new negotiation on a bilateral basis with the Soviet Union would be fruitful in advance of the Belgrade conference is a matter which I certainly will be glad to consider. In the interim, as I have indicated to the House repeatedly, the Soviet Union is well aware of our attitude with regard to reunification of families and related questions, and we do not miss an opportunity to continue making that case to the Soviet Union.



POLYSAR


Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, in the Prime Minister's letter dated March 27, 1973 to the President of the Treasury Board he proposed that a meeting be held with Mr. John Turner, who was then Minister of Finance, with the Minister of Supply and Services, now the Solicitor General and with the Secretary of State for External Affairs, now the hon. member for Eglington. According to press reports, all three of these gentlemen have been interviewed and said they could not recall having been invited to any such meeting to discuss this matter.
Mr. Speaker, I want to ask the Prime Minister if he has ascertained from the hon. member for Westmount, who was then the President of the Treasury Board, whether or not such a meeting was held and if not why it was not held in view of the fact that the Prime Minister specifically asked that such a meeting be held to see whether or not Polymer should modify its practice of paying rebates into numbered Swiss bank accounts.


Pierre Elliott Trudeau: Mr. Speaker, with respect I believe the hon. member is somewhat inaccurate in his reference to the letter I tabled, I think on Friday. I did not request that that be done. I suggested that it might be one way to proceed. I said perhaps that might be the right way to proceed. If the hon. member reads the letter further on he will see 1 suggested an alternate course that perhaps the responsible minister should take further steps. Mr. Drury so far as I know did not hold the meetings. He preferred to follow the second course I suggested, again in the form of perhaps representations to the Crown corporation in question.


Thomas Clement (Tommy) Douglas: Mr. Speaker, the fact is that the Prime Minister said in his letter this would be the best course to follow.


Pierre Elliott Trudeau: Perhaps.


Thomas Clement (Tommy) Douglas: Also in the note which was attached by the President of the Treasury Board he said he would get written justification from the
November 30, 1976

President of the Canada Development Corporation. I do not think any of these have been received.
I want to ask the Prime Minister, in view of his answer to the hon. member for Oshawa-Whitby to the effect that the former auditor general had concurred in the idea that this idea of rebates being paid was common practice, if he would take a look at the letters he received from Mr. Henderson in which the latter pointed out that this was a common practice but that it was because he had serious questions about it that he directed it to the attention of the Prime Minister. In view of the fact that no one is questioning the idea of paying rebates on volume discounts but that what is called in question is the paying of money into numbered bank accounts which could result in tax evasion or fraud, I want to ask the Prime Minister if the government condones this type of practice and whether or not he is prepared to ask the Canada Development Corporation to discontinue this practice because of the impropriety which undoubtedly is apparent to anyone who takes the trouble to look into it.


Mr. Speaker:: Order, please. With regret, although that was a very long and full explanation it is in fact a repetition of a question which was previously asked this very day.
The hon. member for Saskatoon-Biggar.



FINANCE


Mr. Ray Hnatyshyn (Saskatoon-Biggar):: Mr. Speaker, I have a question for the Minister of Finance. Having regard to the statements of officials within his department that there is communication between OECD officials and officials of the Department of Finance during the preparatory stages of the report on the Canadian economy, is it the understanding of the minister that OECD based their forecasts which indicate a mini-recession for our country on the same economic data available to the minister.


Donald Stovel Macdonald: Mr. Speaker, I am advised that at no time did the OECD officials use the term "mini-recession." The process of preparing the OECD report was discussed at some length in the Finance Committee. The hon. member might like to look at the transcript of that meeting.


Ramon John Hnatyshyn: Mr. Speaker, the minister has not addressed himself at least to the processes of the OECD report. When the final OECD report is published, and if in fact its forecasts differ substantially from the forecasts the minister has made, will he undertake to make a statement explaining why he thinks his forecasts are right and the forecasts of the OECD are wrong.
Oral Questions


Donald Stovel Macdonald: In due course I will be glad to comment. I am not sure whether a statement has to be made in this House on every occasion when the OECD or any other international agency makes comments on Canada.



TRANSPORT


Mr. David MacDonald (Egmont):: Mr. Speaker, I have a question for the Minister of Transport. In light of the vastly increased exports of New Brunswick and Prince Edward Island potatoes through maritime ports, principally Halifax and Saint John after the freeze-up, and the very serious decline in the availability of refrigerated cars, which has declined by half in the last six years, which are available totally from the United States and leased by Canadian railroads, has the minister determined whether there will be an adequate supply available during the peak shipping months this winter or whether as some predict we will be faced with a crisis shortage in terms of transporting this vital product?


Hon. Otto E. Lang (Minister of Transport):: Mr. Speaker, that question has been studied carefully by the Canadian National Railways and the potato marketing board. The basic view is there should be adequate equipment and the Canadian National is looking to see if that is the case. There are some foreseeable problems in other years certainly as potato volumes increase.


David Samuel Horne MacDonald: Mr. Speaker, in light of the serious situation the minister indicates may well develop in the near future, has the minister had consultation with the Minister of Agriculture in terms of a presentation he will make to cabinet on the purchase of a fleet of refrigerated cars to meet this specific need and is he in substantial agreement with the proposal.


Otto Emil Lang: Mr. Speaker, I did discuss this matter with the premier and the minister of agriculture for Prince Edward Island as well as the potato marketing board. I do not think I have any further comment to make at this time.


David Samuel Horne MacDonald: Mr. Speaker, since the Minister of Agriculture, his own colleague, has made a public statement in respect of his own representations, I am wondering whether or not he has had consultations with him and whether he is in substantial agreement with the proposals he is making to the cabinet.


Otto Emil Lang: Mr. Speaker, I do not want to draw any conclusions at this point because I will want to look more thoroughly at the total intermodal study that is going on because I think it is not just a question of acquiring the proper equipment but being sure of the decision for the future concerning what kind of equipment that should be. Therefore, the mode of transpor-

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Oral Questions
tation which should be used need not necessarily be refrigerated cars.



AMOUNT OF LOSS ON SALE OF NUCLEAR REACTOR TO ARGENTINA

Mr. James Gillies (Don Valley):: Mr. Speaker, in the absence of the Minister of Energy, Mines and Resources I should like to direct my question to the Prime Minister. It arises out of a report that an exact accounting has now been arrived at by the Governments of Canada and Argentina as to the exact loss on the reactor sale. I should like to ask the Prime Minister if he could now tell the House and the country how much it has cost the people of Canada to supply a nuclear reactor to the Argentine.


Mr. Maurice Dupras (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, I will take the question as notice.



TRANSPORT


Mr. J. M. Forrestall (Dartmouth-Halifax East):: Mr. Speaker, I have a question for the Minister of Transport. In light of the minister's press release of November 3 detailing the change in the federal subsidy to improve shipping service along the B.C. coast in which it is stated River Tow had agreed to hold the tariff rate while experience is gained in the operation and did not foresee any major increases in respect of tariff, and in light of the fact that River Tow's rates for passenger and automobile traffic on that part of the coast have now increased some 150 per cent, can the minister indicate the reasons for such an enormous increase, particularly inasmuch as it is away in excess of any AIB guidelines and flies in the face of the assurance which apparently was left with the minister that there would not be any substantial change.


Otto Emil Lang: Mr. Speaker, 1 gather the hon. member is counting as his source the same newspaper report I have seen. Obviously, I will want better information than that on the total picture. However, even in that report one particular item was singled out as the example and I wonder, too, whether that was a distortion and not indeed therefore the real picture.



SUGGESTED MONITORING OF BRITISH COLUMBIA COASTAL SHIPPING RATES

J. Michael Forrestall: Mr. Speaker, I share the concern about that and wonder if I might ask the minister, inasmuch as he undertook in his press release

to institute a system of monitoring these costs so that the disastrous effects on those living up on the shallows would not be extended, what procedure he will follow to monitor and whether in fact any monitoring procedures are already in place. If not, will he institute them immediately and report back to the House.


Otto Emil Lang: Yes, Mr. Speaker. Both the officials and 1 will be watching the situation very closely and, of course, in addition we will be hearing directly from members of parliament from that area.



REGIONAL ECONOMIC EXPANSION


Mr. Roch La Salle (Joliette):: Mr. Speaker, I have a question for the Minister of Regional Economic Expansion.
Last July the federal government signed an agreement with Quebec minister Gerard-D. Levesque for the establishment of an industrial park at Mirabel. Yesterday the Quebec Minister of Industry and Commerce deplored the fact that nothing had been done to allocate funds and get the project under way. Since the project is important-the minister is well aware of it-and considering that in the meantime Quebec must finance the whole undertaking, would the minister be prepared to recommend that part of the funds available under this agreement be paid as soon as possible to carry out this project?


Hon. Marcel Lessard (Minister of Regional Economic Expansion):: Mr. Speaker, I would like to clarify a point made by the hon. member and which is reported in the newspapers. In all our programs of auxiliary agreement with the provinces, it is provided that the province pays the expenses because it is responsible for the administration and the development of the agreement as concluded. Then it gives us the bill. We pay back as agreed.
In the case of the agreement to which the hon. member referred, it was indeed signed at the very beginning of the summer, during which we developed the administrative machinery. The provincial government will have to decide whether it must pay the money, make it available to an agency called SPICAM, a corporation created by the provincial government and which we are part of to a certain extent. This corporation is responsible for the development of the industrial park and will start working at any time.


Roch La Salle: Mr. Speaker, may I ask a supplementary question?
Since some people seem very concerned about the willingness and co-operation of the federal government, a matter I have no doubt about, would the minister tell us whether he is prepared to work for the achievement of this important project?
November 30, 1976


Marcel Lessard: Certainly, Mr. Speaker. I did sign this agreement and indeed in recent weeks we held several meetings with government officials to ensure that the development of this industrial park is progressing on schedule.


Roch La Salle: Thank you. That is a good answer.



NATIONAL DEFENCE


Hon. Mitchell Sharp (Eglinton):: Mr. Speaker, I would like to address a question to the Minister of National Defence. Yesterday he announced the closing of a base in the constituency of Eglinton, the Avenue Road site of the Canadian forces base, and I would like to ask him whether he can assure the House and the people in my constituency that before deciding on the use to which that site will be put he will consult with authorities in Toronto and local citizens groups.


Hon. Barney Danson (Minister of National Defence):: Yes, Mr. Speaker, I can certainly give that assurance. Indeed, my colleague, the Minister of State for Urban Affairs, and I have already indicated to the municipal officials that we will discuss with them the best use of that property, as will be the case in Edmonton.



FACTORS CONSIDERED IN MOVEMENT OF AIRBORNE REGIMENT FROM EDMONTON

Steve Eugene Paproski: Mr. Speaker, I have a supplementary question.


Some hon. Members:: Oh, oh!


Ramon John Hnatyshyn: The west will rise again.


Steve Eugene Paproski: My question is for the Minister of National Defence. Would the minister please advise this chamber whether operational effectiveness, the morale of troops, training problems, relocation costs and the economic impact on the city of Edmonton were taken into consideration when the decision was made to move the Canadian Airborne Regiment from Edmonton to Petawawa?


Barnett Jerome Danson: Yes, Mr. Speaker, every one of those items was taken into consideration.


An hon. Member:: And ignored.


Barnett Jerome Danson: Discussions will be taking place with officials. I have already spoken to the minister for urban affairs in Alberta and Mayor Cavanaugh of Edmonton, and discussions will take place as to the best use for the benefit of those great citizens of Edmonton Centre.
Oral Questions


Steve Eugene Paproski: Mr. Speaker, I hate to disagree with the minister, but what he is really saying is that all this is political patronage. That is the criterion the minister has used.


Some hon. Members:: Oh, oh!


Steve Eugene Paproski: You are not welcome in Edmonton from now on.


Barnett Jerome Danson: Mr. Speaker-


Some hon. Members:: Oh, oh!


George Harris Hees: Don't go west of Saskatchewan, Barney.


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



GOVERNMENT ADMINISTRATION


Mr. Derek Blackburn (Brant):: Mr. Speaker, my question is addressed to the Prime Minister. I presume he has been given notice by the government House leader.
Since the Prime Minister stated that he could not implement the proposal of the Auditor General for a comptroller general because of the ramifications of this new position which, and 1 quote, "would have to be studied in detail, and it is this problem which led us to the point of royal commissions," and since the chairman of the Royal Commission, Mr. Allen Lambert, has recommended implementation of the post of comptroller general, will the Prime Minister now accept Mr. Macdonell's and Mr. Lambert's advice and implement this post?


Pierre Elliott Trudeau: Mr. Speaker, I am not sure if the hon. member has quoted accurately the chairman of the Royal Commission, but I do know that for some time now the former president of the treasury board and the present President of the Treasury Board have been seeking some way of accommodating the objective of Mr. Macdonell, and indeed, the deputy secretary of the Treasury Board, who was appointed in 1974, I believe, was given considerable assistance some time last spring in pursuing the task which the Auditor General and the government feel should be pursued, that of ensuring greater financial responsibility. I know those discussions are going on. It is possible that there will be some change made to the present position of the deputy secretary of the Treasury Board.
1506

November 30, 1976
Oral Questions MANPOWER



LOCAL INITIATIVES PROGRAM-METHOD OF ALLOCATING FUNDS AND SELECTING PROJECTS

Mr. Jack Marshall (Humber-St. George's-St. Barbe):: Mr. Speaker, my question is for the Minister of Manpower and Immigration. In view of the anxieties expressed-and interest brought about by the doubling of LIP-by many sponsors who have had their projects turned down, I wonder if the minister would indicate what process is going to take place; for example, when will the allocation of funds be made by district, who will be responsible for the selection of the projects, will the projects be taken on the basis of the priorities of Constituency Advisory Groups, and will members of parliament be consulted in this selection?


Hon. Jack Cullen (Minister of Manpower and Immigration):: Mr. Speaker, thanks in large measure to my colleagues who felt that the principles underlying this program should be directed to areas of high unemployment, the hon. member should have little concern about that. With respect to the groups, we expect to use the projects which are already in the hopper, as it were, under the priorities given to them by the CAG groups. I am not sure I have answered all the questions put by the hon. member. I expect some time this week we will be able to announce the allocations on a constituency basis.



INDUSTRY


Mr. Perrin Beatty (Wellington-Grey-Dufferin-Waterloo):: Mr. Speaker, my question is for the Minister of Industry, Trade and Commerce. On November 18 the minister indicated to the hon. member for York-Simcoe that the government was giving consideration to the implementation of quotas on footwear imported from abroad in order to save Canadian jobs in the footwear industry. In view of the fact that yesterday the minister announced quotas to protect workers in the textile industry, is the government now prepared to introduce similar quotas to protect the jobs of those in the footwear industry?


Hon. Jean Chretien (Minister of Industry, Trade and Commerce):: Mr. Speaker, we have this problem under study but unfortunately I cannot give more indications to the hon. member.
If I may, since I have the floor, I would like, as the acting minister for the President of the Treasury Board, to tell the hon. member for Red Deer (Mr. Towers) that the government has full confidence in Mr. Stoner who has been appointed to the commission, and that in my opinion the insinuations made by the opposition in the House are-


Some hon. Members:: Motions.


Mr. Speaker:: Order, please.



FOOTWEAR-CLOSING OF PLANTS IN MOUNT FOREST AND MARKDALE, ONTARIO-RESULTS OF INVESTIGATION

Henry Perrin Beatty: On November 9 the minister assured me that he would personally investigate the closings of two shoe plants in my constituency, one in Mount Forest and one in Markdale, by Kinney Shoes. Has the minister made that investigation, and if so, what action does he propose to take to save the jobs of the 300 workers involved?


Joseph Jacques Jean Chrétien: Mr. Speaker, I am not yet able to report to the House. I have the problem under study. Yesterday we took harsh steps with regard to the textile industry, but I do not know for the moment if we will have to do the same regarding the footwear industry.



NATIONAL DEFENCE


Mr. Peter Elzinga (Pembina):: Mr. Speaker, my question is supplementary to the one put by the hon. member for Edmonton Centre to the Minister of National Defence. Since the Canadian Airborne Regiment is being removed from Edmonton, could the minister explain to the House why the perimeter lines for acceptable noise levels are being extended at Namao air base?


Barnett Jerome Danson: Mr. Speaker, I wonder if the hon. member would repeat the last part of that question.


Peter Elzinga: Can the minister explain why the perimeter lines for acceptable noise levels are being extended at the Namao airbase?


Barnett Jerome Danson: No, Mr. Speaker, I could not tell that. At this time I do not have the answer to that but it is probably trying to protect the people of Edmonton Centre.


Mr. Speaker:: The hon. member for Oshawa-Whitby (Mr. Broadbent) on a question of privilege.



PRIVILEGE


John Edward Broadbent: Mr. Speaker, 1 am rising on a question of privilege about which I gave the Chair notice yesterday. Since it concerns the Prime Minister (Mr. Trudeau), I deferred raising it until today so he would be
November 30, 1976

in the House. One of the essential arguments for a legitimate question of privilege is that it pertains to an act which impinges upon our capacities or rights as members of parliament to do our job. I think that is the essential case that has to be made.
One of our essential rights or obligations as members of parliament is the monitoring of spending by the government or by agencies inextricably connected to the government over which the government has responsibility and authority. That, Mr. Speaker, is the issue that I think is involved or that I will argue is involved in my question of privilege.
The former auditor general, Mr. Henderson, wrote a letter to the Prime Minister Vh years ago in which he outlined some very questionable financial practices of Polysar Corporation. He did so instead of doing what, in my opinion, he ought to have done, which was to have brought the matter to the attention of this House. He is an officer of this House, and his obligation is to report such activities to the House of Commons and not to the Prime Minister. That was not done and he exercised that judgment at that time.
In a letter dated March 27, 1973, the Prime Minister, in writing to the former president of the Treasury Board, agreed that such practices raised at least the possibility of embarrassment and also intimated that they were possibly illegal. In the letter to the former president of the Treasury Board he suggested that the minister at that time should "organize a discussion on the question" with three other specified ministers of the Crown. The Prime Minister concluded his letter with the specific request that this matter be "given immediate consideration", and urged the minister to report back to him with his conclusions or suggested course of action, presumably.
My question of privilege is that we, as members of parliament, would not have learned of this very serious possibility of financial wrongdoing or possibly illegal financial wrongdoing-and not simply moral wrongdoing-had not the former auditor general brought this matter out into the open, into the public, last week. The question of privilege I raise is twofold in nature: the first aspect is that the Prime Minister ought to have acted immediately to have the situation described to him by the former auditor general thoroughly investigated. Then he ought to have ensured that such inappropriate activity as he thought was possible-and turned out to be the case-was stopped or, if the activity that he requested be investigated turned out to be illegal, that ought to have been stopped as well.
In fact, instead of ensuring that such action was completed, the Prime Minister simply sent a letter VA years ago and did nothing else in the interim. We would not be discussing it here in the House of Commons under a question of privilege today had it not been for the former auditor general deciding last week that he had to raise the matter, not in a letter to the House of Commons or to any minister of the Crown or the Prime Minister but that he had to release it to the press.


An hon. Member:: Irresponsible!
Privilege-Mr. Broadbent


John Edward Broadbent: A Liberal member says that was irresponsible of the former auditor general. That is some standard of morality I say, Mr. Speaker, and I have said it already. There is that aspect of it, Mr. Speaker; the Prime Minister did not act. He did not follow through with the required course of action to see that such behaviour described by an auditor general at the time as being wrong in nature was investigated and halted. That was not done.
The second aspect of my question of privilege, Mr. Speaker, is that in my view the Prime Minister, as a member of this House and as the head of the cabinet which derives its authority from having support in this House of Commons, had an obligation not only to investigate and correct such financial wrongdoing, if it existed, but had a further obligation to report back either at the time or after it was cleared up to all members of the House of Commons so that we would know about it. This, too, was not done.
That, Mr. Speaker, is my question of privilege. If you should rule that I have a prima facie case, I am prepared to move that this matter be referred to the Standing Committee on Privileges and Elections and that the Prime Minister and the former auditor general be asked to appear as witnesses.


Mr. Speaker:: Order, please. The hon. member for Oshawa-Whitby (Mr. Broadbent) has given notice of the question of privilege. It has always been the habit of the Chair to hear both sides on a question of privilege, and I am prepared to do so if the House wishes. In fairness, and to make sure the contributions are equalized, however, I am prepared to hear other representatives.
I must confess I have the greatest difficulty in a matter which relates to a Crown corporation and particularly founded upon the hon. member's remarks that it was in the first place the duty of the Auditor General to report the matter to parliament if he thought it should be reported to parliament. Therefore, since it was connected with a Crown corporation and, in the hon. member's own words, if it was to be reported to this House it ought to have been the Auditor General who did so. I have serious difficulty with other remarks with regard to any other obligations upon the Prime Minister. That is not the question for the Chair. The question is whether it constitutes a question of privilege in any definition, and I have great difficulty with that.
It has been the practice in the past to hear both sides, and I am now prepared to hear the Prime Minister (Mr. Trudeau) if he wishes to comment.


Pierre Elliott Trudeau: Mr. Speaker, you have almost ruled that there is no question of privilege. I would be reluctant to intervene in the debate if I thought the matter would end with your ruling, but I think experience has shown that this matter will not end with your ruling and that we are likely to hear of it again in one form or other. With your indulgence, therefore, I should like to make one point so that the case contrary to that made by the leader of the New Democratic Party (Mr. Broadbent) would be heard.
80005-281/2

November 30, 1976
Privilege-Mr. Broadbent
It seems to me the only new element in his question of privilege is the fact that I would allegedly have done nothing in the intervening 3'/2 years after I took immediate action upon receipt of Mr. Henderson's letter. I think the point to be made there is that I took no further action because, in the opinion of the then auditor general, presumably no further action was required.


An hon. Member:: That is why he wrote you?


Pierre Elliott Trudeau: Let me qualify that: no further action was required for 3xh years. I base that statement on the fact that when this matter was raised with the auditors of Polysar, they had their auditors, Peat, Marwick and Mitchell look into the matter. They then reported, as I am told they reported, again over the weekend in words which are very clear-


Ramon John Hnatyshyn: Read the Globe and Mail.


Pierre Elliott Trudeau: -to the effect that, and I quote:
No bribes, kickbacks or illegal payments were involved. The transactions were audited by us in accordance with generally accepted auditing standards and accounted for in accordance with generally accepted principles.
In our opinion, no contingent liability arose from these rebates, and so on, Mr. Speaker. This was the opinion of the qualified professionals in that case. Having got that opinion from Peat, Marwick and Mitchell the then officials of the Crown corporation made that answer known to the minister who was acting on my behalf, the hon. member for Westmount (Mr. Drury). The opinion was made known to Mr. Henderson; and the point is, Mr. Speaker, that he did not act for 3lA years.


Ramon John Hnatyshyn: He has not been the auditor general.


Pierre Elliott Trudeau: The hon. member opposite said that he has not been the auditor general. The point is that when he wrote to me, when these facts were known to him, he was the auditor general.


Ramon John Hnatyshyn: And he waited for the reply.


Pierre Elliott Trudeau: If he had not been satisfied by the answer of Peat, Marwick and Mitchell and by the answer of the lawyers, he could then, as I suggest it would have been his duty to do if he thought there was anything wrong, have said in his annual report to parliament, "I wrote to the Prime Minister. He acted; we got answers, but I still do not agree with those answers and therefore I am reporting to parliament." He did none of this. He was satisfied with the answers made at the time, as Mr. Drury was satisfied and as I was satisfied. I would have been satisfied had I been acquainted with the details of the report.
I return to the question of privilege. In no way have the rights of members of parliament been infringed upon in their ability to do their job because, in the opinion of the then servant of parliament-the former auditor general-it was not necessary, in his report which succeeded his letter to me, that he should raise the matter.
I conclude that the government is perfectly right in suggesting that this matter should be aired before the public accounts committee. I suggest, and hope, that the reference to the public accounts committee will be on the point of whether there was any bribery which, after all, is the allegation which appeared in the newspaper and for which the then auditor general was quoted. That is the central point. If there are any peripheral points, I hope they will also be heard; but I am still concerned about allegations of bribery which are denied by the auditors and denied by the lawyers.


George Harris Hees: It was just sharp business practice, then.


Mr. James A. McGrath (St. John's East):: Mr. Speaker, there are a number of important points which should be brought out-even though Your Honour has indicated you are ready to rule on the question of privilege-and which go to the heart of parliament, namely, the ability of this House to control spending and the accountability of the Auditor General, as an officer of this House, to this House.
It should be borne in mind that when the auditor general in his letter of March 22 reported to the Prime Minister (Mr. Trudeau), it was virtually his last official act as the auditor general of Canada. At that time he was exercising the only option open to him, reporting to the government under the act setting up the office of the Auditor General, that he had discovered a serious matter with respect to the books of the Crown corporation. There is provision under the Auditor General's Act for the Auditor General to so report to the government in between times when he reports to parliament. The act provides that the Auditor General shall report to parliament at the end of each calendar year. Sir, this letter was written to the Prime Minister-


Pierre Elliott Trudeau: When was his report made?


James Aloysius McGrath: On March 22, virtually when the former auditor general was about to retire from office. Presumably, he was reporting to the government in order to bring this matter to the attention of parliament. The point is, the matter was never brought to the attention of this House, which is the crux of the question of privilege raised by the leader of the NDP (Mr. Broadbent) in this House.
The problem is further complicated and exaggerated by the fact that my colleague, the chairman of the public accounts committee, has been thwarted in his efforts to have the terms of reference of the committee broadened so that the matter can properly come before the public accounts committee in the course of its examination of the Auditor General's report. I submit, through you, sir, to the government House leader, that the matter could be quickly disposed of if the government House leader would agree to stand in his place and broaden the terms of reference of the Auditor General's-


Mr. Speaker:: Order, please. With respect to that particular point, which is a little far afield of the question of privilege now raised, the President of the Privy Council (Mr. Mac-Eachen) stood in his place yesterday and made that commit-

November 30, 1976

ment; at least, it seemed clear on the record. He indicated that if the terms of reference were not broad enough, they ought to be.


Ramon John Hnatyshyn: The minister is nodding his head in the affirmative.


James Aloysius McGrath: My point is, he has not done so. The public accounts committee has already met and commenced its examination of the Auditor General's report. It has satisfied itself that it does not have the authority to raise this matter, namely, the report of the former auditor general to the government. That is the crux of the matter, Mr. Speaker. Consequently, we have no way of examining the former auditor general in the public accounts committee. We have no way of examining the circumstances surrounding the letter sent to the Prime Minister on March 22 and the subsequent follow-up, or lack of follow-up, by the Prime Minister when he received that letter from the auditor general in March of 1973.
I submit, Mr. Speaker, that in the narrow procedural terms in which you view the question of privilege, there may not be a prima facie question of privilege. Nevertheless, this question of privilege was prompted by the frustration of members of the House in getting at this matter in a meaningful way. The House can only satisfy itself if the government House leader broadens the terms of reference so that the public accounts committee can get at this matter.


Thomas Clement (Tommy) Douglas: Mr. Speaker, the Prime Minister (Mr. Trudeau) has sought to deal with this question of privilege by saying that while the committee of ministers which he recommended did not meet, nevertheless the then President of the Treasury Board at that time was satisfied. The fact remains that last Friday the Prime Minister himself said in the House that he had not heard anything for Vh years and did not know what action had been taken with respect to the letter which he sent to the hon. member for Westmount (Mr. Drury) on March 27, 1973. The Prime Minister said today that the former auditor general did not do any more about it. 1 think he should be reminded that the letter was written in March and the former auditor general left office a few months after that letter was written: he had no opportunity at all to follow-up. The letter which the former auditor general wrote to the Prime Minister on March 22 said, in part:
The extent to which Polymer and its subsidiary may be contingently liable for aiding and abetting such transactions largely depends, of course, on whether the customers concerned are apprehended by their respective national authorities. The officials of Polymer and Polysar believe there is little danger of this because the practices followed arc not uncommon; in fact they are fairly prevalent today in the operations of multinational corporations in many parts of the world.


Ramon John Hnatyshyn: There are lots of robberies, as well.


Thomas Clement (Tommy) Douglas: I continue quoting:
Nevertheless I consider it my duly to draw your attention to this contingent liability because these corporations are handling public moneys and are owned by the government of Canada. While it may indeed be possible to defend any claims made against Polymer and Polysar from a corporate standpoint, the fact
Privilege-Mr. Broadbent
remains that the publicity attendant on the charges which could be made against a Canadian Crown Corporation and/or Canada Development Corporation could have serious and undesirable consequences.
Finally, he said:
The reason why, as the auditor of Polymer, I have not insisted on disclosure of the existence of this contingent liability is that to have done so would in my view have been contrary to the best interests of Polymer as a multinational corporation trading in world markets in a highly competitive field. However, I would be remiss in my duty if I did not draw the seriousness of this situation to your attention.
That is far from the auditor general having been satisfied. With reference to the auditors of Polysar, I would be interested to know the date of the report which the Prime Minister read and which the Minister of Finance (Mr. Macdonald) passed over to him, because the press reports quote Mr. Cowpcrthwaite, senior Canadian representative, as being very specific. He said:
It's not up to us to say whether there was tax evasion or not . . . Whether or not the transaction is intended to result in tax evasion or foreign exchange control evasion is not the responsibility of the auditor as such.
He went on to add the phrase: "Anglo-Saxon ethics don't apply". 1 do not know what type of ethics do apply, but there is an attempt to say that the auditor general was satisfied and did not follow up the matter when he left office only a few months after writing the letter, and to suggest the auditors of the company were satisfied merely because they said there were no proven bribes. What they did not explain was not their duty to explain. It is the duty of the minister to explain why rebates which should have properly been sent to the head offices of the company in question were sent to numbered Swiss bank accounts. The only purpose of putting money into numbered Swiss bank accounts was either to evade tax payments in the countries of the customer companies or in order to make payments that were improper so that they could not be traced either for kickbacks or for bribery. Surely that is the matter which the government should have investigated, rather than giving us this flim-flam. 1 am little tired of getting the story: There is nobody here but us chickens.


Mr. Speaker:: Order, please. There are two other members who 1 see want to participate in this discussion, and I am prepared to hear them. However, I am not getting much help on whether or not we have a question of privilege. It may be an interesting subject for discussion, but if hon. members wish to call into play the decisions that were taken and the steps that were either taken or not taken at that time, there are other methods of doing so within our rules. The only question for the Chair at present is whether this matter should take precedence over other business by way of question of privilege so as to pre-empt other business, and whether to put the question for sending it to the committee. That is not the subject that is being discussed. It seems to me that we are into a debate as though we were, in fact, discussing the question of privilege. What I really need is guidance from hon. members as to whether or not the classic definition of privilege applies to the situation.

November 30, 1976
Privilege-Mr. Broadbent
1 am prepared to hear the Minister of Finance and the hon. member for Winnipeg North Centre (Mr. Knowles) if they have anything to contribute to that decision.


Donald Stovel Macdonald: Mr. Speaker, 1 rose because the hon. member for Nanaimo-Cowi-chan-The Islands (Mr. Douglas) put on the record what has been contradicted by those who have the legal responsibility for examining the transactions. I will repeat what the Prime Minister (Mr. Trudeau) said a minute ago, that the auditors, Peat, Marwick and Mitchell, said in the statement prepared last weekend for the company which they were auditing.


John Edward Broadbent: What happened 3 '/2 years ago?


Pierre Elliott Trudeau: You are quoting from this morning's paper, you kook.


Some hon. Members:: Hear, hear!


Donald Stovel Macdonald: 1 am trying to explain to the hon. member for Oshawa-Whitby (Mr. Broadbent) that the company is, one can say, falsely accused of having engaged in illegal practices. The company has, most appropriately, sought advice of the tax advisers and auditors after the false accusations of last week as to the transactions about which it was falsely accused. Those auditors prepared the following statement which 1 think should be read in extenso into the record so that we will not have a repetition by members, such as the hon. member for Nanaimo-Cowichan-The Islands, of statements that are false.


Some hon. Members:: Hear, hear!


Donald Stovel Macdonald: This is a statement from Peat, Marwick and Mitchell which was made public on November 29, 1976, at 10.23 a.m., eastern standard time, and has been carried on Canadian Dow Jones. Mr. Rush, the president of Polysar quotes the following Peat, Marwick and Mitchell statement:
We, Peat, Marwick and Mitchell, were joint auditors with the auditor in 1972. We also signed the audit report which gave a clean opinion on the financial statements of the company . ..
The transactions in question were rebates to bona fide customers which were fully disclosed to us by the company during the course of the audit.
I repeat, Mr. Speaker, what the Prime Minister read a few minutes ago. It goes on to read:
No bribes, kickbacks or illegal payments were involved.
I address that specifically to the hon. member for Nanaimo-Cowichan-The Islands who repeated the false allegations. It goes on to read:
The transactions were audited by us in accordance with generally accepted auditing standards and accounted for in accordance with generally accepted accounting principles.
In our opinion no contingent liability arose from these rebates.
Because of the significance of the amounts involved, the matter was raised by the auditors and discussed fully at an audit committee meeting of the board of directors on February 22, 1973. That was in order to ensure that the directors understood the practice and at the request of the auditors a legal opinion was obtained from the company's international lax and legal counsel confirming the
(Mr. Speaker.]
legality of the rebates and the fact that there would be no adverse consequences to the company.
We are now the sole auditors to know that the practice of rebates continues and through our normal audit verifications we are satisfied that the rebates are accounted for properly in the company and that no contingent liabilities exist.


Some hon. Members:: Hear, hear!


George Harris Hees: All you did was condone slippery business practice.


An hon. Member:: No business morality.


Donald Stovel Macdonald: The hon. member-


George Harris Hees: -for Prince Edward-Hastings.


Donald Stovel Macdonald: The hon. member for Prince Edward-Hastings (Mr. Hees) said that we condoned a slippery practice.


George Harris Hees: Sure, you did.


Donald Stovel Macdonald: I would point out that what I read was a statement by an internationally and nationally known firm of auditors, confirmed by legal counsel, confirming the fact that, contrary to the allegations made on the other side of the House, there was absolutely no illegality.


Some hon. Members:: Oh, oh!
An. hon. Member: Keep quiet.


George Harris Hees: 1 will not keep quiet.


Mr. Speaker:: Order, please. We are getting rather far afield from the basic question of privilege and into a debate on actions taken at the time. If that is going to be pursued, it will have to be done under another motion. I should like to hear only whether or not a question of privilege exists.


Donald Stovel Macdonald: The hon. member for Oshawa-Whitby gave no indication as to what privilege of the House is involved in this case. Certainly, from the facts as set out by the Prime Minister and by myself, the complaint raised by the former auditor general was referred immediately to the company in question and fully investigated. In other words, the matter was fully explored and the propriety of the transactions was confirmed. To suggest that the privileges of any hon. member have been breached in any way is completely without foundation, 1 suggest. The government acted as quickly as it received the complaint of the former auditor general.


John Edward Broadbent: Three and a half years ago?


George Harris Hees: You offend our sense of honour.


Donald Stovel Macdonald: It acted as quickly as it received the complaint, and confirmation came from independent advisers as to the propriety of the transactions.


Some hon. Members:: Oh, oh!
November 30, 1976


Stanley Howard Knowles: Mr. Speaker, I should like to get into the argument as well, but I shall heed your plea that any further contributions relate to the basic issue as to whether or not there is a question of privilege. But perhaps you might permit me to say that it is important, in relation to the words which have just been read from Peat, Marwick and Mitchell, to note again the words of Mr. Gordon Cowperthwaite, senior Canadian partner of the firm, who said yesterday:
It's not up to us to say if there was tax evasion or not. Whether or not the transaction is intended to result in tax evasion or foreign exchange control evasion is not the responsibility of the auditor as such.
I would also point out that the Prime Minister (Mr. Trudeau) to say that Mr. Henderson did nothing more after he wrote his letter to the Prime Minister on March 22, 1973, and was therefore satisfied, overlooks the fact that Mr. Henry Alan Lawless wrote back to Mr. Henderson on March 26 a letter of acknowledgment in which it was said that the matter would be drawn to the Prime Minister's attention without delay. That put Mr. Henderson off. Then in a postscript to the Prime Minister's letter to the hon. member for Westmount (Mr. Drury) he said: "1 have not made any reply to Mr. Henderson's letter other than the acknowledgment of Mr. Lawless, a copy of which is herewith. It seems to me that any further reply, if there is to be one, ought to be directed to the acting auditor general or the new Auditor General as the case may be." In other words, the government had no intention of dealing any further with Mr. Henderson.


An hon. Member:: And you can see why.


Stanley Howard Knowles: Let me come to the issue which faces the Chair: Is there a question of privilege? Usually, a question of privilege is raised because someone has done something wrong. It is a little easier, then, to see it. The question of privilege raised by my leader, the hon. member for Oshawa-Whitby (Mr. Broadbent) relates to the fact that something was not done, and the something which was not done was an act of omission on the part of two persons: first, Mr. Maxwell Henderson in his failure to report to parliament things he had discovered and about which he wrote to the Prime Minister; and, second, the Prime Minister in his failure to let the House know what Mr. Henderson had told him.
The point of our having read all this correspondence over and over again is to establish the fact that Mr. Henderson knew what was wrong and wrote about it to the Prime Minister, who then knew it too. He said in the paragraph quoted by my hon. friend from Nanaimo-Cowichan-The Islands (Mr. Douglas) that he was not reporting it to parliament, for certain reasons which we question. At any rate, there were two persons-Mr. Henderson, who was responsible to parliament, and the Prime Minister, who was also responsible to parliament. Both knew certain facts about which parliament should have been told, and their failure to tell parliament what was going on interfered with our right and our capacity to do
Privilege-Mr. Broadbent
our job. That is my point: the failure to do certain things interfered with our right and capacity to do our job.
1 believe the hon. member for Oshawa-Whitby not only has a question of privilege but has been extremely responsible in suggesting that the two persons who have wronged this House should appear before the committee, namely, Mr. Maxwell Henderson and the Prime Minister.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Order, please. First, I feel it is important we should separate the two questions. There is one question which was raised by the hon. member for St. John's East (Mr. McGrath) and one which was just referred to by the hon. member for Winnipeg North Centre (Mr. Knowles), that is, the ability of the Standing Committee on Public Accounts to look into this matter. This seems to me to be a totally separate question from the question of privilege raised by the hon. member for Oshawa-Whitby (Mr. Broadbent), and if the effort is to establish that the hon. member's question of privilege has validity because the Standing Committee on Public Accounts cannot investigate this matter, that is certainly not the argument of the hon. member for Oshawa-Whitby or of the hon. member for St. John's East. A reference to it was just made by the hon. member for Winnipeg North Centre. At any rate, the hon. member for Winnipeg North Centre concluded his remarks by saying that the two people who wronged parliament should be brought before the standing committee: that is my recollection.


Stanley Howard Knowles: The Standing Committee on Privileges and Elections, to which it is proposed to refer the matter.


Mr. Speaker:: The standing committee. The fact is that there is one question here, and that is the ability of the Standing Committee on Public Accounts-and one standing committee is as good as another, in my view, in this respect-to carry out an investigation. One standing committee seeks to investigate this matter, and there is some question outstanding at the present time as to whether or not its terms of reference are broad enough to enable it to do so. If not, there has been a clear commitment, in my opinion, and unequivocal commitment by the President of the Privy Council (Mr. MacEachen), that the terms of reference ought to be broadened permit that investigation. Therefore that question appears to me to be entirely separate from the question of privilege.
This leaves on its own the question of privilege which was raised, and raised very seriously, by the hon. member for Oshawa-Whitby. The question is, it seems to me, that the Auditor General brought something to the attention of the Prime Minister of the day, about 3'A years ago, rather than bringing it to the attention of parliament. Certainly, had he wished to bring it to the attention of parliament he was sufficiently experienced at that time to have done so; I do not think there is any doubt about that. He, having brought it to the attention of the Prime Minister, and the matter having relationship to a Crown corporation as opposed to a govern-

November 30, 1976
Privilege-Mr. Broadbent
ment department, is it possible that failure on his part to bring that to the attention of parliament could then place upon the Prime Minister of the day not only an obligation to do so but such an obligation that his failure to do so would offend the privileges of this House as we know them to be under the classic definition of privilege?
I can only conclude by saying that for me to begin to broaden the classic definition of parliamentary privilege to that extent would be out of all keeping with the definition as we have always understood it. Again, this is not to suggest for one minute that the matter is not serious. It is obviously serious. The Prime Minister himself said-and he is certainly, I think, making an accurate prediction-that this is not going to be the end of the matter.
I must say 1 am guided to some extent by the commitment made that if the public accounts committee is not able to look into this, it certainly ought to be able to, and that if its terms of reference are not broad enough to look into it, they ought to be attended to. This being the case, it would be difficult for me to attempt to extend the umbrella of privilege to cover this matter, one which obviously has been taken into account by the House, the House having demonstrated its will to do so in some way, shape or form. Therefore, I cannot entertain this as a question of privilege.


Allan Joseph MacEachen: I rise on a point of order, to tell Your Honour and hon. members, through you, that with consent 1 am quite prepared to make a motion that the subject matter of the letter from the auditor general of Canada to the Prime Minister, dated March 22, 1973, and tabled on November 26, 1976, be referred to the Standing Committee on Public Accounts.


Some hon. Members:: Hear, hear!


John Edward Broadbent: There are two letters.


Mr. Baker (Grenville-Carleton):: I take it the House leader means that not only should the motion cover the letter from the auditor general but all those matters which flow from it, including the reply.


Allan Joseph MacEachen: The subject matter.


Walter David Baker: That is the understanding.
I am prepared to accept the acknowledgment that this is the understanding of the government House leader.


Allan Joseph MacEachen: The words have been carefully chosen. The expression is "the subject matter of the letter" and the subject matter, as hon. members know, is quite wide.


Mr. Speaker:: With the consent of the House, the President of the Privy Council, (M. MacEachen) seeks leave to present a motion as described by him. Such a motion can only be presented at this time by unanimous consent.


Some hon. Members:: Agreed.


Allan Joseph MacEachen: That the subject matter of the letter from the auditor general of Canada to the Prime Minister of Canada, dated March 22, 1973, tabled November 26, 1976, be referred to the Standing Committee on Public Accounts.


Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, I understand the motion is debatable. I do not rise to oppose the motion, but I am in a somewhat embarrassing situation. The subject matter of this letter, together with the revelations made public last Friday, came at a time when the steering committee of the public accounts committee did not have an opportunity to discuss the matter. So what I say now, I say as an individual member of the House and of the public accounts committee.
I point out, Mr. Speaker, that we are getting into a rather extraordinary field of investigation for a standing committee of the House, one quite foreign to the usual activities of a standing committee, specifically the public accounts committee. We would not now be dealing with a subject matter that is within the control of the government, within the control even of this House, indeed within the control of a Crown corporation. We will be dealing, hopefully, with the production of witnesses and the production of documents which would entail the releasing of those matters to the committee by a commercial organization that has been removed even one further sphere away than the rather insular attitude of Crown corporations of this government.
I can see absolutely nothing wrong with the actual terms of reference, but my purpose in standing before you today, sir, is to plead for a situation that may well come about in the future. I refer to the fact that if, for instance, a foreign-based corporation which now has very nebulous ties with this government and this parliament refuses to give the committee the full access which I am sure the committee will demand, then we will have to come back to this House to have the terms of reference perhaps even further widened in order to give us subpoena powers to produce documents.


James Aloysius McGrath: We already have those.


Allan Frederick Lawrence: Yes, that is right. My hope had been that because we are dealing with a brand new, wider sphere than the committee has, so far as I know, dealt with in the past, the subpoena powers regarding documents of that nature might have been included in the terms of reference presented to the House today. They are not. Nevertheless, I hope that if we do run into difficulty there will be no problem at all in further widening the terms of reference so as to compel the attendance of witnesses and the production of documents. Obviously, we do not have that power now.


John Edward Broadbent: On the same point of order, Mr. Speaker, Standing Order-
November 30, 1976


Mr. Speaker:: Order, please. The hon. member was not on a point of order. He has made his speech in the debate on the motion.


John Edward Broadbent: Then speaking to the motion, Mr. Speaker, as the government House leader knows, Standing Order 65(8) reads as follows:
Standing committees shall be severally empowered to examine and enquire into all such matters as may be referred to them by the House, and, to report from time to time, and, except when the House otherwise orders, to send for persons, papers and records, to sit while the House is sitting, to sit during periods when the House stands adjourned-
And so on. The point I want to make in discussing the motion is that we accept the phrase offered by the government House leader as being of sufficiently broad scope to cover the subject. However, what we would like from the government House leader is the assurance that the majority members on the committee, the government members, will in fact support the proposal that witnesses be called, that they will support the view that whatever needs to be done thoroughly to investigate the matter will in fact be permitted to be done.


Mr. Speaker:: Order, please. The House has heard the terms of the motion. Is the House ready for the question?


Some hon. Members:: Question.
Motion (Mr. MacEachen) agreed to.


Mr. Mazankowski:: Mr. Speaker, I rise on a point of order. Yesterday I directed a question to the Minister of Supply and Services regarding the payment of some $500,000 termed as marketing services involving the sale of some 20 CF-5 aircraft by Canadair. At that time the parliamentary secretary indicated to the House that the minister would be in the chamber later in the afternoon and that the information was available. I am wondering whether I might prevail upon the House to ask the Minister of Supply and Services either to give that information to the House now, or table it, as was agreed to yesterday.


Mr. Speaker:: Order, please. It is correct that the hon. member for Vegreville and the hon. member for Victoria both had questions to put to the Minister of Supply and Services and that his parliamentary secretary did say yesterday that the minister would be in later with the information. However, all that notwithstanding, if the minister is to be permitted to give that information to the House, either orally or by tabling it, this would have to be done with the consent of the House.


Some hon. Members:: Agreed.
[ Translation]


Jean-Pierre Goyer: Mr. Speaker, we are not being asked to go back three and half years this time but some five years for a transaction which was reported by the Auditor General, not on the point raised by the hon. member, but on the one which was thoroughly discussed before the parliamentary committee on public accounts. The committee did not see fit to report to the House on that matter which meant that they accepted the transaction. In any event, I have revised the record and, to the
Order Paper Questions
best of my knowledge, representatives of the Canadian Commercial Corporation did follow the policy in force at that time. This practice concerned commissions paid to agents or sale representatives abroad for services rendered. Criteria were as follow: that the commission be reasonable, that it be justified, that the agent be qualified, that he be recognized as bona fide and that he refrain from resorting to any dishonest mean.



ROUTINE PROCEEDINGS


Mr. Joe Clark (Leader of the Opposition) moved: for leave to introduce Bill No. C-381, to amend the Broadcasting Act.


Some hon. Members:: Explain.


Charles Joseph Clark: Mr. Speaker, the purpose of this bill is to improve the procedures whereby the Prime Minister of Canada is able to requisition time on our national broadcast networks and opportunity is provided to opposition leaders for comment. Among its specific provisions, this bill would transfer responsibility for supervision of this whole process to the Canadian Radio-Television Commission and require that the Prime Minister first make any such statement to this House before broadcasting it to the country as a whole, if the House of Commons is sitting at the relevant time. I would hope, Mr. Speaker, that in light of recent events this bill would recommend itself to fair-minded members on all sides of the House.


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

Mr. Ralph E. Goodale (Parliamentary Secretary to President of the Privy Council):: Mr. Speaker, the following questions will be answered today: 140, 442, 444, 445, 446, 493, 511,604, 709 and 735.


Mr. Orlikow: 1.	For the fiscal year 1975-1976, what contracts for professional services were let (a) for studies, surveys and analyses into present or future policies, programs or information analysis, and their efficiency and effectiveness (b) into the examination of the administration or internal operation of the Department of National Defence?
2.	How much was committed on each contract and to whom?
3.	What were the comparable figures for the fiscal year 1973-1974?

November 30, 1976
Order Paper Questions


Barnett Jerome Danson: 1 and
2.
Studies, Survey or Analysis	Amount Committed	Name of Consultant or Firm(i)	Development of academic policies and procedures at Military Colleges and development of B & B facilities and programs at Royal Military College	$ 9,000	Dr. R. Cousineau(ii)	Study of Human Factor Analysis services in support of the new Terminal Radar Systems at CF airfields	$37,785	Digital Methods Ltd., Ottawa(iii)	Study of computer hardware engineering considerations to meet air traffic control equipment requirements at CF airfields	$31,000	ADGA Ltd., Ottawa(iv)	The Diplomatic Utility of Canada's Naval Forces	$21,621	Acadia University, Dr. Nicholas Tracy(v)	East Asian Studies Concerning Sino-Soviet Relations and the Strategic Significance of the Malacca Strait	$ 3,000	Prof. R. G. Boyd, Halifax(vi)	The Parliamentary and Policy Aspects of Political Consultation Within NATO-Part II	$ 3,000	Mr. R. J. Hill, Ottawa(vii)	Study of Recent Changes in NATO	$ 5,000	Mr. R. J. Hill, Ottawa(viii)	To provide consultant assistance as part of a DND team developing	$40,000	Systems Approach Ltd., Ottawa
analytical models for the Defence Services Program MK V
3.	Details concerning Department of National Defence studies, surveys and analyses asked by Parts 1 and 2 of this question for fiscal year 1973/74 are all contained in Public Accounts of Canada Vol. II Section 31 pages 35-40.


Mr. Hnatyshyn: For the years 1970 to 1975, what was the number of (a) full-time (b) part-time classification officers at Stony Mountain Institution and, in each case, what were their (i) educational qualifications (ii) previous work experiences in Canada (iii) individual salaries?


Mr. Art Lee (Parliamentary Secretary to Solicitor General):: (a) 1970 and 1971: Two classification Officers, (i) MA. (ii) School teacher-Provincial Case Worker, (iii) S10,143-$11,525. (i) MA. (ii) Provincial Social Worker, (iii) $10,143-$11,525. 1972: Five Classification Officers, (i) BA. (ii) Transfer from National Parole Service, (iii) $7,447-$9,801. (i) Grade 12. (ii) From Stony Mountain, transfer to Classification. (iii) $7,447-$9,801. (i) BA. (ii) From University direct to Classification, (iii) $9,326-$ 11,107. (i) BA Honours, (ii) School Teacher, Manitoba, (iii) $1 1,236-$ 12,764. (i) MA. (ii) Provincial Social Worker, Manitoba, (iii) $12,416-$14,108.

1973: Nine Classification Officers, (i) BA. (ii) Transfer from National Parole Service, (iii) $12,416-$ 14,108. (i) BA. (ii) Transfer within Stony Mountain Institution, (iii) $10,035-$12,273. (i) BA. (ii) Transfer within Stony Mountain Institution. (iii) $10,035-$ 12,273. (i) MA. (ii) Social Worker, Province of Manitoba, (iii) $12,416-$14,108. (i) BA. (ii) From University direct to classification, (iii) $10,035-$12,273. (i) BA. (ii) Supervisor, Provincial Retarded Centre, (iii) $12,416-$14,108. (i) BA. (ii) Sales Clerk, and University graduation, (iii) $8,229-$ 10,830. (i) BA Honours, (ii) Teacher, Human Relations. National Defence Research Assistant, (iii) $10,035-$12,273. (i) MA. (ii) Teacher and Case Worker, (iii) $12,416-$14,108. 1974: Ten Classification Officers, (i) BA. (ii) Transfer from National Parole Service, (iii) $12,416-$14,108. (i) BA. (ii) Transfer within Stony Mountain Institution, (iii) $11,336-$ 13,500. (i) Grade 12. (ii) Transfer within Stony Mountain Institution, (iii) $11,336-$ 13,500. (i) MA. (ii) Social Worker, Province of Manitoba, (iii) $13,658-$15,519.
(i)	BA. (ii) From University direct to classification, (iii) $11,336-$ 13,500. (i) BA. (ii) Supervisor, Provincial Retarded Centre, (iii) $13,658-$ 15,519. (i) BA. (ii) Sales Clerk, and University graduation, (iii) $1 1,336-$ 13,500. (i) BA Honours.
(ii)	Teacher, Human Relations, National Defence Research Assistant, (iii) $11,336-$ 13,500. (i) MA. (ii) Teacher and Case Worker, (iii) $13,658-$ 15,519. (i) BSW. (ii) Provincial Case Worker, (iii) $11,336-$13,500. 1975: Ten Classification Officers, (i) BA. (ii) Retail Sales Officer, (iii) $ 13,658-$ 15,519. (i) MA. (ii) Teacher and Case Worker, Manitoba, (iii) $13,658-$15,519. (i) BA Honours, (ii) Human Relations Teacher, National Defence Research Assistant, (iii) $13,658-$15,519. (i) BSW. (ii) Provincial Social Worker, (iii) $13,658-$15,519. (i) BSW. (ii) Case Worker, City of Winnipeg, (iii) $15,886-$ 18,052. (i) BA. (ii) Supervisor, Retail Centre, (iii) $13,658-$15,519. (i) BSW. (ii) Case Worker, Province of Manitoba, (iii) $1 1,336-$]3,500. (i) BSW. (ii) Provincial Social Worker, Manitoba, (iii) $13,658-$ 15,519. (i) BSW. (ii) Social Worker, Manitoba, (iii) $13,658-$ 15,519. (i) MA. (ii) Provincial Social Work, Manitoba, (iii) $13,658-$ 15,519. (b) None.


Mr. Hnatyshyn: For the years 1970 to 1975, what was the number of (a) full-time (b) part-time classification officers at Beaver Creek Correctional Camp and, in each case, what were their (i) educational qualifications (ii) previous work experiences in Canada (iii) individual salaries?


Arthur John (Art) Lee: (a) 1970 and 1971: One Classification Officer, (i) BA; (ii) Social Worker; (iii) 1970, $10,143-$l 1,525. 1971, $10,701-$12,159. 1972 and 1973: One Classification Officer, (i) BA, BTh; (ii) Minister, Anglican Church; (iii) 1972, $11,236-$ 12,767. 1973, $12,416-$14,108. 1974 and 1975: Two Classification Officers, (i) BA; (ii) Post graduate studies, Moncton University, Moncton, N.B.; (iii) 1974 and 1975, $ 13,658-$ 15,-
November 30, 1976

519. (i) BA; (ii) Direct entry from Trent University, Peterborough, Ontario; (iii) 1974 and 1975, $13,658-$15,519.(b None.


[Stage Direction]
Question No.445-Mr. Hnatyshyn:
For the years 1970 to 1975, what was the number of (a) full-time (b) part-time classification officers at Pittsburgh Institution and, in each case, what were their (i) educational qualifications (ii) previous work experiences in Canada (iii) individual salaries?
Arthur John (Art) Lee: (a) 1970, 1971, 1972 and 1973: One Classification Officer. (i) BA; (ii) Teacher, several Ontario schools; (iii) 1970, $10,143-SI 1,525. 1971, $10,701-512,159. 1972, $11,236-512,-767. 1973, $12,416-514,108. 1974 and 1975: Two Classification Officers, (i) BA; (ii) Joined Service at Collins Bay Institution. Transferred to Pittsburgh, 1974; (iii) $13,658-$15,519. (i) MCA; (ii) Joined Service at Bath Institution, Transferred to Pittsburgh, 1974; (iii) $13,658-515,519. (b) None.


Mr. Hnatyshyn: For the years 1970 to 1975, what was the number of (a) full-time (b) part-time classification officers at Quebec Federal Training Centre and, in each case, what were their (i) educational qualifications (ii) previous work experiences in Canada (iii) individual salaries?


Arthur John (Art) Lee: (a) 1970: Three Classification Officers, (i) BA, BSS, MA Sociology, (ii) Provincial Government-Social Worker, (iii) Salary range $11,799-$ 13,408. (i) Grade 11. (ii) CX at Federal Training Centre, (iii) Salary range $10,143-$ 1 1,525. (i) Grade 12. (ii) Assistant bookkeeper and secretary, (iii) Salary range $10,143-511,525. 1971: Three Classification Officers,
(i)	BA, BSS, MA Sociology, (ii) Provincial Government-Social Worker, (iii) Salary range $13,448-514,145. (i) Grade 11. (ii) CX at Federal Training Centre, (iii) Salary range $10,701-$12,159. (i) Grade 12. (ii) Assistant bookkeeper and secretary, (iii) Salary range $10,701-512,159. 1972: Four Classification Officers, (i) BA, BSS, MA Sociology, (ii) Provincial Government-Social Worker, (iii) Salary range $13,070-514,852. (i) Grade 11. (ii) CX at Federal Training Centre, (iii) Salary range $11,236-512,767. (i) Grade 12. (ii) Assistant bookkeeper and secretary, (iii) Salary range $11,236-512,767. (i) BA Psychology, BSc Psychology, (ii) Bookkeeper-Solicitor General, St. Vincent de Paul, (iii) Salary range $11,236-512,767. 1973: Seven Classification Officers, (i) BA, BSS, MA Sociology, (ii) Provincial Government-Social Worker, (iii) Salary range $14,442-516,411. (i) Grade 11. (ii) CX at Federal Training Centre, (iii) Salary range $12,416-514,108. (i) Grade 12. (ii) Assistant bookkeeper and secretary, (iii) Salary range $12,416-514,108. (i) BA Psychology, BSc Psychology, (ii) Bookkeeper-Solicitor General, St. Vincent de Paul, (iii) Salary range $12,416-514,108. (i) BA. (ii) Metropolitan Life Insurance Officer, Montreal.
Order Paper Questions
(iii)	Salary range $12,416-514,108. (i) BA. (ii) Direct graduate entry 1969, University of Montreal, (iii) Salary range $12,416-514,108. (i) BA. (ii) Transfer from Leclerc on promotion, Teacher, Laval School Board, (iii) Salary range $12,416-$14,108. 1974: Eight Classification Officers, (i) BA, BSS, MA Sociology, (ii) Provincial Government-Social Worker, (iii) Salary range $15,886-518,052. (i) Grade 11. (ii) CX at Federal Training Centre, (iii) Salary range $13,658-515,519. (i) Grade 12. (ii) Assistant bookkeeper and secretary, (iii) Salary range $13,658-515,519. (i) BA Psychology, BSc Psychology.
(ii)	Bookkeeper-Solicitor General, St. Vincent de Paul, (iii) Salary range $13,658-515,519. 1974 (i) BA. (ii) Metropolitan Life Insurance Officer, Montreal, (iii) Salary range $13,658-$15,519. (i) BA. (ii) Direct graduate entry 1969, University of Montreal, (iii) Salary range $13,658-$ 15,519. (i) BA. (ii) Transfer from Leclerc on promotion, Teacher, Laval School Board, (iii) Salary range $13,658-515,519. (i) BA Criminology. (ii) Direct entry from Sir George Williams University, Montreal, (iii) Salary range $11,336-513,500. 1975: Nine Classification Officers, (i) BA, BSS, MA Sociology, (ii) Provincial Government-Social Worker, (iii) Salary range $15,886-518,052. (i) Grade 11. (ii) CX at Federal Training Centre, (iii) Salary range $13,658-515,519. (i) Grade 12. (ii) Assistant bookkeeper and secretary, (iii) Salary range $13,658-$ 15,519. (i) BA, MA, M Ed. (ii) Professor, Concordia University, Montreal, (iii) Salary range $ 13,658-$ 15,519. (i) BA Criminology, (ii) Transfer from Leclerc Institution on promotion, Teacher, Laval School Board, Laval, P.Q.
(iii)	Salary range $11,336-513,500. (i) Bachelor of Law. (ii) Graduate from Laval, Direct entry to CPS. (iii) Salary range $8,940-513,440. (i) Grade 12. (ii) Warehouse man and Librarian at Federal Training Centre, (iii) Salary range $13,658-515,519. (i) BA Sociology, MA Sociology and Psychology. (ii) National Parole Service, (iii) Salary range $13,658-515,519. (i) Grade 12. Teacher's Certificate, (ii) Vocational teacher, Montreal Schools, (iii) Salary range $8,940-513,440. (b) None.


Mr. Orlikow: 1.	(a) Who is the General Counsel of the Anti-Inflation Board (b) what is the (i) classification (ii) salary or salary range of the position?
2.	(a) What previous position in the Public Service did he or she hold (b) what was the (i) classification (ii) salary or salary range of the position?


Mr. Bob Kaplan (Parliamentary Secretary to Minister of Finance):: 1.	(a) Mr. A. Garon.	(b)	(i)	LA3.	(ii)


[Stage Direction]
2.	(a)	Department of Justice,	(b)	(i)	LA3.	(ii)
Mr. Baker (Grenville-Carleton): 1.	What are the present regulations concerning the raising and lowering of water levels on the Rideau Canal at the beginning and ending of the navigation season?

November 30, 1976
Order Paper Questions
2.	Have there been any recent changes in the regulations and, if so, for what reason?
3.	Do the regulations apply to all sections of the Rideau Canal?
4.	(a) Is there presently any water level control practised during the winter months on the section of the Rideau Canal between the locks at Burritts Rapids and Long Island and, if not, for what reason (b) would such a policy increase operating costs and, if so, to what estimated extent?
5.	(a) On what date was the last general dredging done on the section of the Rideau Canal between Burritts Rapids locks and Long Island locks (b) is any dredging contemplated within the next year (c) has Parks Canada received complaints concerning the condition of the Rideau Canal in this section due to deterioration of the channel (d) have complaints been received concerning high water levels on this section of the Rideau Canal prior to or during the navigation season and, if so, are changes contemplated?
6.	Was any survey undertaken to determine the drainage flow into the Rideau River and the canal system from the Rideau watershed and (a) if so, on what date (b) if not, is one proposed and on what date?


Mr. B. Keith Penner (Parliamentary Secretary to Minister of Indian Affairs and Northern Development):: 1. There are some 22 major reaches on the Rideau Canal. On most reaches the level is lowered during the non-navigation season for environmental, water control, safety, power generation, agricultural, operational and economic reasons. The dates of lowering the reaches as well as the amount of draw down are often varied to facilitate construction work, to accede to requests and to minimize flooding.
2.	There have been no recent major changes, however, variations as indicated in 1 above have been carried out since the establishment of the waterway.
3.	See 1 above.
4.	(a) Yes. (b) Not applicable.
5.	(a) The last dredging in this section of the Canal was carried out in 1968 to improve navigation for vessels, (b) No. (c) The Department has no record of complaints relative to conditions of navigation channel. Complaints due to flooding have been received. The main reason for flooding in this area is due to natural configuration of Rideau River bed upstream from Long Island which acts as an obstruction in periods of high flows, (d) Yes. A study is presently underway to ascertain if it would be beneficial to draw this reach down before winter freeze-up instead of before freshet as is the present practice. It is also proposed in the period from the end of freshet to June 1st to maintain reach one foot below normal summer level.
6.	(a) Yes. Surveys are conducted prior to freshet each year. The most recent survey was February/March 1976. (b) Not applicable.


Mr. Munro (Esquimalt-Saanich): 1.	(a) How many regional offices are maintained by the Department of Manpower and Immigration (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?


Jack Sydney George (Bud) Cullen: In so far as the Manpower Division is concerned: 1. (a) Five, (b) Halifax, Montreal, Toronto, Winnipeg, Vancouver, (c) Halifax (Atlantic Region) Nova Scotia, New Brunswick, Prince Edward Island, Newfoundland; Montreal (Quebec Region) Quebec, Toronto (Ontario Region) Ontario; Winnipeg (Prairie Region) Manitoba, Saskatchewan, Alberta, North West Territories; Vancouver (Pacific Region) British Columbia, Yukon.
Region	Date Established	Number of PersonnelAtlantic	September 1966	48Quebec	September 1966	82Ontario	September 1966	88Prairie	September 1966	61Pacific	September 1966	46Region	Present Number of PersonnelAtlantic	205Quebec	249Ontario	251Prairie	213Pacific	1774.	Yes. (a) Halifax, N.S.; Fredericton, N.B.; St. John's Nfld.; Charlottetown, P.E.I.; Montreal, Que.; Rimouski, Que; Quebec, Que.; Drummondville, Que.; Ste. Therese, Que.; Toronto, Ont.; Hamilton, Ont.; Vanier, Ont.; Thunder Bay North, Ont.; Barrie, Ont.; London, Ont.; Winnipeg, Man.; Regina, Sask.; Edmonton, Alta.; Yellowknife, N.W.T.; Vancouver, B.C. (b) 20.5.	A number of the senior positions within the regional and/or district offices are line functions and are in the chain of command from Ottawa to the operator in the field, the remainder of the regional and/or district personnel perform staff functions in support of the line such as regional personnel, administration and financial administration.
In so far as the Immigration Division is concerned: 1. (a) Six. (b) Halifax, Montreal, Toronto, Winnipeg, Vancouver and Ottawa, (c) Halifax (Atlantic Region) Nova Scotia, New Brunswick, Prince Edward Island, Newfoundland; Montreal (Quebec Region) Quebec; Toronto (Ontario Region) Ontario; Winnipeg (Prairie Region) Manitoba, Saskatchewan, Alberta, North West Territories; Vancouver (Pacific Region) British Columbia, Yukon; Ottawa (Foreign Service Region) Immigration Offices outside Canada.
November 30, 1976

			Number of
2.	Region	Date Established	PersonnelAtlantic	September 1966	2Quebec	September 1966	7Ontario	September 1966	6Prairie	September 1966	3Pacific Foreign	September 1966	4Service	September 1966	27Present Number3.	Region	of PersonnelAtlantic	22Quebec	93Ontario	45Prairie	13Pacific	19Foreign Service	984.	Yes. (a) Moncton, N.B.; Montreal, Que.; Mirabel International Airport, Que.; Quebec, Que.; Toronto, Ont.; Mississauga, Ont.; Hamilton, Ont.; London, Ont.; Ottawa, Ont.; Sault Ste. Marie, Ont.; Winnipeg, Man.; Edmonton, Alta, (b) 12.5.	The duties performed by those manning the regional and/or district offices are line functions, in the chain of command from Ottawa to the operator in the field.


Mr. Neil: Have any letters been received by the Census Branch from the Province of Saskatchewan questioning the accuracy of the population count taken during the 1976 Census and, if so (a) how many (b) what steps have been taken to verify the accuracy of the count?


Mr. Hugh Poulin (Parliamentary Secretary to Minister of Industry, Trade and Commerce):: Statistics Canada reports the following: (a) Yes. Census Field of Statistics Canada received letters from 99 municipalities, villages and towns in Saskatchewan about the 1976 Census Preliminary Population Counts during the months of July and August. The figures sent to mayors or reeves were preliminary and still must go through a series of adjustments before final counts are published. The mayors were specifically invited by Statistics Canada to comment before the final figures were issued, (b) The 1976 Census preliminary population counts are the result of basic arithmetic calculations from field documents. To verify these preliminary figures further field documents are tabulated and compared with the original documents used. Not only are population figures checked, but dwelling counts, maps and in many cases the source of alternative figure, if provided by a municipality. A municipality is informed of the results of this research as soon as it is available. It must be noted that the 1976 Census final population counts will be available next Spring. The major operation to be carried out on all counts is a relocation of "temporary residents" (those persons away from their usual place of residence on Census Day) who were not
Order Paper Questions
included in the preliminary count, to the location of their permanent residence. Due to the large number of farmers maintaining two residences, Saskatchewan had the highest percentage of temporary residents in the country on Census Day. The final count for the province should therefore, reflect a marked difference from the preliminary counts.


Mr. Muir: At the opening of the Visitor Centre at the Fortress of Louisbourg on August 15, 1976, was a reception held for the guests and, if so (a) who tendered the reception (b) who was invited (c) what was the cost (d) were alcoholic beverages served?


B. Keith Penner: Yes. (a) The Louisbourg United Church Women, (b) All of those who attended the opening ceremony-both formally invited guests and the general public, approximately 500 people, (c) $500. (d) No.


Ralph Goodale: Mr. Speaker, if questions Nos. 197, 443 and 600 could be made orders for returns, these returns would be tabled immediately. If any explanation or reasons are required, I would be glad to present them at this time.


Mr. Speaker:: Is it the pleasure of the House that the three questions enumerated by the parliamentary secretary be deemed to have been made orders for returns and that the returns be tabled forthwith?


Ramon John Hnatyshyn: Mr. Speaker, as one of these questions is mine, I wonder whether the parliamentary secretary would be good enough to indicate the reason he is asking that it be made an order for return.


Ralph Goodale: Yes, Mr. Speaker. In accordance with the suggestion which you made to me some time ago, I think it might be a useful practice if an explanation were given automatically in each case. In connection with question No. 197, the answer involves a lengthy set of statistics regarding forest fire losses presented in the form of a rather complicated chart. That is the reason this question is being answered in this way. In connection with the other two questions, Nos. 443 and 600, the answer includes lengthy details, in one case, about classification officers, and in the other case about the organization of regional offices. Again, the details are rather lenghty, and that is the essential reason the answers are given in this way.

November 30, 1976
Order Paper Questions


Mr. Speaker:: Is it the pleasure of the House that the three questions shall be deemed to have been made orders for returns, with the returns being tabled forthwith?


Some hon. Members:: Agreed.


Mr. Marshall: 1.	What statistics, if any, are available concerning losses due to forest fires in the Province of Newfoundland?
2.	What are the comparable figures for each of the other provinces and territories?
Return tabled.


Mr. Hnatyshyn: For the years 1970 to 1975, what was the number of (a) full-time (b) part-time classification officers at Joyceville Institution and, in each case, what were their (i) educational qualifications (ii) previous work experiences in Canada (iii) individual salaries?
Return tabled.


Mr. Munro (Esquimalt-Saanich): 1.	(a) How many regional offices are maintained by the Department of Indian Affairs and Northern Development (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
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?
Return tabled.


Ralph Goodale: Mr. Speaker, I would ask that the remaining questions be allowed to stand.
{Mr. Goodale.]



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Monday, November 29, consideration of the motion of Mr. Andras that Bill C-19, to amend or repeal certain statutes to enable restraint of government expenditures, be read the second time and referred to the Standing Committee on Miscellaneous Estimates; and the amendment thereto of Mr. Holmes (p. 1393).
Mr. G. H. Whittaker (Okanagan Boundary):: Mr. Speaker, I would like to take this opportunity to continue my remarks on Bill C-19, the restraint of government spending, and the amendment by a member of this party which, in effect, suggests that the bill should be read the second time six months hence. It is my belief that this amendment is very timely in that it will give the government six months in which to bring in a more comprehensive bill. I would urge hon. members to consider it seriously and vote in favour of it. Perhaps the government does not require six months. I think it could manage to do this much faster than that. In the many excellent speeches we have heard during the debate, particularly those of my colleagues, many areas that were not covered have been pointed out. It has become quite clear that the bill as it now stands is quite cosmetic and deals mainly with the transfer of payments and the indexing of family allowances. It is only a one-shot deal, mainly window-dressing.
There is, in fact, a great deal of inefficiency and empirebuilding in this government. This bill should really go to the fundamental cutting of government expenditures, indicating clearly what this government intends to do in the future. The taxpayers of this country want the fat trimmed from government spending. The taxpayers are aware of the large increase in government spending over the past few years, and they know that this has been almost out of control since 1971. The people want to activate the conscience of this government and its cabinet ministers. They realize the Minister of Transport (Mr. Lang) really does not have a conscience, but they wonder if this is true of the rest of the cabinet. The Minister of Transport is not here today, but he is one who likes to fly around in his Jetstar, spending money and arrogantly trying to defend such expenditure.
The transportation system of this country requires a lot of upgrading and overhaul. The Minister of Transport has flown into my riding and told the people engaged in the fruit industry there that if it is cheaper to send their fruit to eastern Canada via United States railways, that is what they should do. That is not the kind of action that will alleviate the unemployment problem in Canada. The Minister of Transport knows full well that those engaged in the fruit industry have contracted for piggyback cars with the railway companies and must utilize those cars to the fullest extent if they are to live
November 30, 1976

up to the contracts. This has boxed them in with Canadian railways to a great extent.
The minister is also aware of the fact that the Canadian railways, I suppose as a result of his running around talking about the concept of user-pay, intend to increase their freight rates on British Columbia apples by 17 per cent. This will put the growers in the position of paying 2 cents a pound, or SI a box more than via U.S. railways. We have to utilize the Canadian railways, and that is as it should be, but when representations are made to the minister he says he cannot do anything about the 17 per cent increase. When representations are made to the Anti-Inflation Board we are told it can do nothing about the situation, and when representations are made to the Canadian Transport Commission we are told it can do nothing-yet 17 per cent is higher than that allowed labourers, and higher than set out in the Anti-Inflation Board guidelines. This form of transportation is being allowed this kind of a percentage increase, while the Minister of Transport flies around the country spending money with great abandon, doing very little about transportation problems in Canada. This is the kind of thing the people want cut back, and this is the area where the fat can be trimmed. Such action would indicate that the government is sincere about restraint in government spending.
We know, as should this government, that small businesses form the backbone of this country. We also know we have an unemployment problem. This problem could be alleviated by making small businesses stronger so that they, in turn, could put people to work. To accomplish this we must have reductions in income taxes paid by small businesses. We must put our resources into those areas where we can put the people to work. This will be done only if the government comes to its senses and realizes it must restrain government spending.
We know very well that this government takes far too great a percentage of the gross national product. This means that the government's spending is out of line. The government spends much more, and much more quickly, than it should. This is the reason I fully support the amendment that the bill be read six months hence, to give the government an opportunity to take a real look at government spending and bring forward something that is comprehensive and meaningful in respect of stopping the government spending that is going on in Canada today.


Mr. Arnold Malone (Battle River):: Mr. Speaker, the issue before the Elouse is restraint in government spending. I think it is important at the outset of my comments to point out that we on this side of the House would support any serious intent by this government to restrain the amount of spending. Bill C-19, however, does not meet this objective. Moreover, it causes most significant harm to the Canadian society. It is with that perspective in mind that I am pleased to speak again on the amendment that has been put forward by the hon. member for Lambton-Kent (Mr. Holmes) to the effect that this bill not be read at the present time but that it be read six months hence.
Restraint of Government Expenditures
We are now in a situation where the government of Canada spends $42 billion. If we look at some of the clauses of Bill C-19 we see things such as the indexing of family allowances. This will mean, in effect, that those in the higher income brackets will not receive family allowances-which does not bother me-but it will also mean that by the indexing, the burden will be borne by families with lower incomes. In my remarks I intend to demonstrate clearly that this government has numerous options by which effectively to practice restraint without even bringing such legislation before the House.
I think the fact that it has brought in Bill C-19 shows lack of imagination and lack of ability on the part of the government to face up to the fact that it has so grossly overspent in many areas that no bill is necessary in order to bring about restraint. The bill is intended to repeal certain statutes to enable restraint of government expenditures. The hypocrisy of the bill is that the restraint fails to meet the test of significance. While the government may be claiming a $1.5 billion restraint program by Bill C-19, the fact is that by the time one has finished reading the bill and doing the mathematical calculations in respect of what the bill actually does, one finds that, in effect, it does not save $1.5 billion but probably saves a few million. What happens is that the rest of it is a shift in cost, as I will demonstrate later in my speech. As an example, some ports will be closed because of the "at and east" policy which the government is talking about retracting. People will be laid off jobs. That is no saving. The saving that takes place there will be merely shifted to unemployment insurance or to a job-creation charge at the other end of the spectrum. So in reality we cannot talk about this bill saving anywhere near $1.5 billion: at least half of that amount will be a shifting of the cost from one pocket to another pocket of the government.
I have the privilege to speak on the amendment in respect of a six-month hoist, but I would rather speak in favour of a lifetime burial of Bill C-19. No one will deny the need for the government of the day to practice restraint, but the government does not need a bill enshrined in parliament to achieve that objective. If the government of the day were sincere about restraint, we might ask why it did not listen to and act in concert with the Auditor General in respect of his recommendations. If the government were truly interested in restraint, it would have taken action by this date clearly to enunciate its intention to establish a comptroller general. That, of course, has not been the practice of the government. That act in itself would have restrained far more money than would Bill C-19 or any similar measure.
We could also ask, if this government truly intends to restrain its fiscal spending, why it has not brought down a new budget which truly talks about restraint and has truth built within it. If the government really wanted to do something about restraint, it could talk about replacing the Minister of Transport (Mr. Lang) with a person who practices the concept of user-pay. Also, if the government were really interested in restraint it could drop the delaying tactics of appointing a royal commission on federal fiscal accountability.

November 30, 1976
Restraint of Government Expenditures
It seems to me that nothing could underscore more the hypocrisy of the government than the fact that it has received, in succession, two auditor generals' reports that condemn the government for its lack of fiscal management-and then, after receiving those reports from two different auditors general, the government says, in effect, that all it will do is appoint a royal commission. I should like to read into the record two short paragraphs from an editorial in the Edmonton Journal of Wednesday, November 24, 1976, which quite accurately expresses my opinion of what is really the purpose in calling for a royal commission. The editorial states:
Announcing a royal commission-in this case, to study the criticized uncontrolled spending-is one of the oldest political tricks. It buys time and permits inaction, under the excuse that a report on the subject is being prepared.
But this time, if the opposition and the people of Canada buy this old line, they will do themselves and the nation a very great disservice. The situation, as Auditor General J. J. Macdonell said, is "critically serious," and after deteriorating for the past 15 years remedies are needed quickly.
Mr. Speaker, if the government is sincere in any attempt at restraint, we will have very quickly to see rise up from the opposite side of the House some action which will indicate that there is something in the Auditor General's report which requires attention and consideration. If we look at another way in which government spending could be restrained, then I think it is time to tell the Prime Minister's private advisers to get off the disguised welfare system and get on with doing a job. They should get on with the job of doing something which is different than that being done for which we already have advisers in the various departments.
We could give the same message to the multitude of private consultants who hang like albatrosses around the necks of each and every department of government. The fact of the matter is that a department of government is established to give counsel to the minister, and I think it is foolishness that the Canadian taxpayers should have to pay, at the rate they do, the exorbitant costs involving private consultations both with the PMO and the various departments of government.
If we sincerely want to trim the $42 billion the government spends of our gross national product, we should bring about significant measures. We should bring about measures which would cause a reduction of taxes and would increase productivity in big and small businesses in this country. As long as we are talking about measures dealing with only millions of dollars-and I do not want to underestimate the importance of the word "millions"-we are not talking about real restraint, and we will not be until this government can demonstrate that it is restraining in terms of billions of dollars, because that is the kind of budget it has laid before the people of Canada.
The word "hoist" implies raising up, but this bill should be buried. I would like to consign Bill C-19 to its final resting place with the following arguments: first, there has been no demonstrative effort to control federal government expenditures. We might ask what might have been done to ensure some restraint. Let us consider some of the anomalies which occur within this bill in an effort to demonstrate that it fails in
terms of significance, that it contains a measure of harm, and that it is discriminatory of what I consider the two outer regions of this country.
The removal of the "at and east" rate is another case of removing a support system from the economies of the prairies and the Atlantic regions. The removal of those rates would cause farmers in the west to sing the song, "Oh, where have all the flour mills gone?" Only two decades ago my constituency was dotted with flour mills. Because of transport policies and this attempt to remove the "at and east" support system, the flour industry is being centralized more and more away from where products are grown. This government wonders why the country appears to be on shaky ground and why some regions have difficulty talking about a unified and solid Canada. There seems to be a direct plan by the government to cause stresses which are unnecessary by favouring a centralization policy, not only in terms of power in Ottawa but in terms of controlling where economic centres and secondary industries are developed.
Virtually all the flour mills on the prairies are extinct. Every industrialized country which has a flour-milling industry has a subsidy for that industry. For government members to talk about removing the "at and east" subsidies is to be unaware of the facts and to be discriminatory of the Atlantic provinces, particularly the ports of Saint John and Halifax. It is definitely discriminatory of the grain producing districts in the western provinces. The government wishes to remove the "at and east" subsidy in the name of restraint, but this bill not only fails to restrain in a significant way but also hampers the movement of grain products from one part of the country to another.
This is another case of padding for central Canada. The removal of the "at and east" subsidy will likely destroy the grain handling aspect of the Saint John and Halifax ports but will have almost no effect on the port of Montreal. Is that a saving? If we take jobs away from one area under the mask of restraint, will there not be more cost by way of increases in unemployment insurance, and will there not be a loss of human dignity and manpower in terms of people being employed in meaningful work? What about the psychological depression which is bound to take place as a result of some of the offshoots and spinoffs of this bill? If unamended, it would cause a higher rate of unemployment in certain regions.
The government talks about restraint and expropriates
88,000	acres for a federal airport called Mirabel. The estimated loss for next year is $46 million. It is hypocrisy to bring in a bill like Bill C-19 when we do not have a new budget and when we do not have a government which is really restraining itself in terms of billions of dollars.
The staff of the Post Office has increased 50 per cent in one decade. When we consider the growth of government spending, we wonder if hon. members opposite can even spell the word "restraint". The government terminated Information Canada with restraint in mind, only to find that expenditures by all other departments rose 16.5 per cent, for a total additional cost of $14,786,000. When we consider that, we can see the

November 30, 1976

implications of Bill C-19. Just a year ago the government said it would do away with Information Canada and there would be a big saving. Then we found that the information costs in all departments increased in excess of $14 million. That is exactly what will happen with regard to other aspects of Bill C-19.
Hon. members of this side of the House are 100 per cent in favour of a sincere restraint program. It is hypocrisy to bring in a bill in an attempt to appeal to the Canadian people with regard to restraint when the fact of the matter is that in every way this bill simply shifts money from one pocket to another and there is no serious intention to restrain government spending. There is no serious effort to cut back personal income tax, which is now at its highest rate in history, and there is no serious intention to stimulate small, middle-sized and big business.
In recent budget debate speeches the word "restraint" has been echoed in nearly every paragraph. But how does the government practice restraint? It does so by increasing capital construction costs by $85 million for the years 1976 and 1977. That is some restraint! Capital expenditures will grow from $546 million to $800 million in the years 1976 and 1977. What is the sense of having a restraint bill when the government practices absolutely the opposite? To a Liberal, doubling costs is considered restraint, if hon. members are serious about restraint, they should be asking themselves such questions as this: have the personnel in the Post Office doubled in the last eight years from 39,180 people to 60,524 people and, if so, why does the Post Office provide only half the service it once did?
Mr. Speaker, I should like to bring to the attention of the House the fact that in 1895 Van Horne moved a division of troops from Ottawa to Winnipeg in ten days when three sections of the railway were still not completed. Just yesterday a constituent wrote me and wanted to know why it took 29 days for a first-class letter to come from Ontario to Alberta- and that follows a doubling of the staff of the Post Office over the last eight years. Yet the government has the audacity to say there is going to be some kind of restraint as a result of Bill C-19.
If there is to be restraint, let us have a budget that shows restraint and cutbacks in a way that is best for the Canadian people. We could send those letters from Ontario to Alberta better by horse and buggy, and I mean that literally. The service of the Post Office, which cost $263 million eight years ago, now costs $850 million in salaries alone. Time and time again members of parliament get letters complaining about the very slow and inadequate service. In the short time that I have been here, I know that the number of people who are dissatisfied with this postal service is growing. We have twice the staff and half the service.
The Unemployment Insurance Commission doubled its staff in the past eight years, and while that created more jobs for the commission, unemployment rose from 400,000 to 850,-000-again, a doubling of staff with half the result. It is important to underscore that if the federal government is truly
Restraint of Government Expenditures intent on a program of restraint, it behooves it either to act immediately upon the recommendations of the Auditor General or to introduce a budget forthwith that would have in it restraint that would be significant to the Canadian taxpayer. Without such stimulus we simply carry on with the same rituals.
That can be clearly demonstrated by analysing what has happened over the years in the Department of Indian Affairs and Northern Development. While I have a good deal of sympathy for the plight of our native people, and I believe it is the role and responsibility of government to show concern and interest in them, the fact is that the bureaucracy of the department has grown to such an extent that if we were to allocate to the Indian families the money it costs to run the department, every family would receive $17,135. I do not suggest that we should give every Indian family $17,000 and do away with the department, Mr. Speaker, but that is what the bureaucracy costs. I think we should reverse this kind of thinking.
Bill C-19 provides that the family allowance will be frozen, but the allowance is taxed anyway-yet the government claims it is practising restraint. Restraint practised on the backs of the people on low income in this country is something that should be challenged not only by members of this House but by all Canadians. I think nothing could more clearly demonstrate that Bill C-19 is improperly before the House than the statement of the Auditor General at page 3 of the Conspectus, where he said:
In the majority of the Crown corporations audited by the Auditor General, financial management and control is weak and ineffective. Moreover, co-ordination and guidance by central government agencies of financial management and control practices in these Crown corporations are virtually non-existent.
If this government really wants to save money and to increase the saving from the millions to billions, then let it be done in one fell swoop. Let us do away with Petro-Can and save $5.5 billion, and not waste our time with an insincere bill that does not restrain, that is not a stimulus to the economy and that will have the effect of creating more activity in the small business community but will not reduce personal income tax. This is simply a shadow-mask with the intention of making the people believe that the government is doing something about restraint. The truth of the matter is that in almost any department no restraint is taking place. The Auditor General underscored that when he said, again, at page 3 of the Conspectus:
I am deeply concerned that, on the evidence of the two-year examination carried out by the audit office, parliament-and indeed the government-has lost or is close to losing effective control of the public purse.
We do not need Bill C-19 in order to gain control of the public purse, yet that is probably one of the most devastating comments that could be made in a thorough study of the financial operation of a government in the history of Canada. To claim that Bill C-19 is in some way going to bring about a restraint and financial improvement aspect is simply reducing the Canadian mentality to its lowest common denominator. I think the government has to recognize that Canadians are more intelligent than that. They know what the government is

November 30, 1976
Restraint of Government Expenditures about, and they know it has an obligation to bring out a budget and to follow the Auditor General's recommendations in such a way that there will be a "felt" restraint program. By "felt", I mean that the Canadian people will see a difference in how the economy is operated and there will be a stimulus for business throughout all sectors of the economy.
Crown corporations have been mentioned, Mr. Speaker. I would recommend that all members of the government make an effort to study Crown corporations with a view to removing as many of them as possible. As the Auditor General points out at page 4:
Based on the study of the systems of departments, agencies and Crown corporations audited by the Auditor General, financial management and control in the government of Canada is grossly inadequate. Furthermore, it is likely to remain so until the government takes strong, appropriate and effective measures to rectify this critically serious situation.
Little can be said about Bill C-19 other than it is a mask held before the Canadian people in an effort to try to disguise the issues of the day. It is a mask held up to try to pretend the government is doing something about restraint. It is a mask for the claim that they are removing $1.5 billion from federal spending. In almost every instance this is either detrimental to the poor people of this country or the poor regions of this country. Sometimes it just shifts the cost from one department to another.
The "at and east" rates and subsidies would be removed by Bill C-19. If this is carried out, it will undoubtedly cause high employment in the ports of Saint John and Halifax, so it is no saving at all. It merely represents a shift of dollars from a subsidy on grain movement to unemployment insurance and to larger manpower staffs which will be needed to deal with the discontent of those in the regions who are alienated from the present centralist government.
It is time to come to grips with the real issue confronting us, the lack of control over this country's financial management. You cannot bring our finances under control simply by restraining expenditures in a few areas, such as family allowances, the "at and east" subsidies and those aspects with which Bill C-19 seeks to deal. If the government is truly serious about restraint, it can show it only if it introduces a new budget. That budget should go to the heart of government spending by freezing the hiring of more employees for the federal government.
The government should commit itself to restricting its own growth until such time as its fiscal policies are in order. Until that is done, this government has no business putting forward Bill C-19. Therefore, I feel privileged in asking the House to adopt the amendment requesting a six months' hoist with respect to second reading of Bill C-19. I hope that during that six-month period the government will take genuine action in terms of analysing its fiscal policies, will look into Crown corporations which are operating in such a terribly inefficient way, and introduce a budget that will significantly reduce the proportion of the gross national product which the government appropriates.

Hon. members will recall that less than a decade and a half ago the two senior levels of government took about 29 per cent of the gross national product for government expenditures. Today, that figure has risen to 42 per cent of the gross national product for the two senior levels of government. Obviously, if one looks at the converse side of the question, the more governments take for their own expenditures, the less remains available for the private sector of society. One must therefore ask government supporters if they, as Liberal members of parliament, believe in the free enterprise system and if they concur in the practice whereby the government takes an ever larger proportion of the gross national product. If they concur in that practice, then obviously they deny the proposition that there should be freedom of thought and of practice for all individuals in society, for they think that the government should be in charge of the economy and not the people, not the grass-roots of the country.
A second danger arises from the government's appropriating an ever larger share of the gross national product. The present government practice suggests that it is in favour of weaker provinces and a stronger federal government, a practice which threatens the fabric of confederation by alienating the far-flung regions of this country-the regions far removed, geographically, from the centre. It should be noted that in the outer regions of Canada there is far greater discontent over bread and butter issues and less confidence in the federal government than was demonstrated even in the November 15 election in the province of Quebec.
If the government shows no sense of fair play and equity, if it persists in bringing before this House bill after bill jeopardizing transportation policies affecting the prairies and the Atlantic regions, in due course the hair on the back of the necks of the people in those regions will rise and you will see demonstrations and actions which will be far more significant than those simply based on differences of language and culture. People live by bread and butter and react when their livelihood is threatened. People in the regions do not look kindly on the present government's practice of taking an ever larger share of the gross national product, of pulling money in from the regions and dumping it in the central area known as the Golden Triangle.
I hope all hon. members will recognize that by recommending the six-month hoist we are not saying that we do not intend to restrain government expenditure. Rather, it is a request for the government to act seriously, to use the period of the six-month hoist for preparing a new budget which will adopt the recommendations of the Auditor General and show Canadians clearly and demonstrably that not only does the government want to cut back spending by a few million dollars, but that it wants to give a considerably higher percentage of the gross national product back to the private sector in order to return incentives for initiative to the people of Canada. They must feel they have their part to play in developing this country. Mr. Speaker, this government governs a ribbon of country 5,000 miles long in which 80 per cent of the population live within 60 miles of the United States border.
November 30, 1976

If ever a country needed to have a less strong centralist government and stronger provincial governments, certainly that country is Canada.
I hope my arguments have convinced hon. members of the foolishness of this bill, of its lack of significance and of the lack of will on the part of the government to do anything concrete with respect to restraint. I hope they will vote in favour of the six-month hoist. If the amendment is adopted, 1 hope the government will do what is necessary to show that it is serious about putting in order the economy and its control over spending.


Mr. Leonard C. Jones (Moncton):: Mr. Speaker, I wish to speak on Bill C-19, the bill for restraint of government expenditures. Hon. members will realize that I have a miserable cold, but I insist on making my speech, come hell or high water, because I think we are debating a miserable bill.


Steve Eugene Paproski: Hear, hear!


Leonard C. Jones: 1 was pleased to see the government finally admit the necessity for restraint, after many years of no restraint. Therefore, I do not criticize the end the government alleges it wishes to achieve by this bill, but I do question some of the means it is using to obtain it. As a member of parliament from the maritime provinces, I am desperately concerned about the effects of the repeal of section 272 of the Railway Act. That section provides the statutory requirement that railways shall maintain certain rates on export grain and flour from specified points on the Great Lakes and the St. Lawrence Seaway ports to maritime ports.
Hon. members have commented on the "at and east" subsidies. The transport committee of the greater Moncton chamber of commerce completed a significant study of the effects of repealing section 272 of the Railway Act. Other hon. members, particularly those from maritime provinces, have already mentioned the effects of such repeal. They are of the utmost importance and I shall list 11 of them this afternoon: first, the increased cost of Canadian flour in foreign markets; second, the loss of foreign markets; third, the loss of foreign currency generated by the flour trade; fourth, the loss of traffic to Canadian ports and Canadian transportation agencies and carriers; fifth, the loss of income to western grain growers; sixth, the loss of employment in the flour milling industry; seventh, the loss of employment in Canadian ports, particularly maritime ports; eighth, the higher railway costs since there will be less traffic to cover overhead; ninth, the loss of employment for Canadian railway workers; tenth, the flour mill at Halifax depends on export markets for a considerable volume of its business. It participates in cargo lots made up by other Canadian mills and exported by Halifax and Saint John. If the Halifax mill must ship its flour back to Montreal or Quebec, it will not be competitive and jobs will be lost in Halifax and Saint John. Eleventh, if the Halifax mill closes, mill feeds produced by the Halifax mill will be unavailable in the maritime area, with an increase in cost affecting the livestock and poultry industries.
Restraint of Government Expenditures
How can a government consciously support the repeal of a section of an act which has such far-reaching consequences to the country as a whole? Is it merely choosing at random the program or bill to be cut or repealed? Is this what other members of the House have been referring to as window-dressing? Certainly, this cannot be the work of responsible legislators, or even of responsible bureaucrats-if there are any.
The Moncton chamber of commerce study which I mentioned earlier recommends that the federal government withdraw that portion of the bill which pertains to section 272 of the Railway Act. I fully agree with their suggestion and strongly urge the government to review their handling of this situation. The Minister of Transport (Mr. Lang)-and recently I have heard him referred to by some nicknames which I will not repeat today-has attempted to compensate for the government's indiscriminate actions by suggesting that other means of transportation be employed to convey the flour and grain from one point to another. May I remind the hon. minister that although this might increase the trucking business, it will result in massive lay-offs in the railway business.
As the member for Moncton, the hub of the maritimes, the transportation centre, it is not difficult for me to recognize the seriousness of this entire matter. This will cause a devastating situation within the constituency of Moncton and the surrounding area. Even the proposed relocation of the branch of the Department of Supply and Services in my area will not begin to make up for the unemployment which will result from the repeal of section 272 of the Railwayy Act. Surely to goodness the Atlantic provinces are as important as other regions in Canada and should be treated as such! The repeal of section 272 is discriminatory, and the burden will weigh heavily on the entire Atlantic economy. The Atlantic provinces will not stand by and let this be done.
The Parliamentary Secretary to the Minister of Regional Economic Expansion (Mr. Lumley) has stated that those who oppose this bill speak with a forked tongue. I wish to exclude myself from this category: those who make such remarks usually speak with a forked tongue. Although there are some harsh measures in the bill, we must realize that this is a time of economic restraint in this country. If certain programs must be done away with, it is the less important and less necessary ones that should be eliminated. There is little doubt that Opportunities for Youth and agencies known as Information Canada and the Company of Young Canadians fall into this category. They should never have been set up in the first place. That was an irresponsible act of the government, to start with. The repeal of section 272 of the Railway Act is not a feasible solution because of the ill effects of such action.
There are many government departments that could follow much more stringent economic practices. The expensive government project known as "Save 10" which falls under the Department of Energy, Mines and Resources, is ample proof of the waste inherent in government offices. There are other many well-publicized government programs which could well benefit from stringent cutbacks. I am thinking specifically of

November 30, 1976
Restraint of Government Expenditures the bilingualism program and the Anti-Inflation Board and its regulations. The government has spent millions of dollars on its language training program, and now it finally admits that it would have been more beneficial had it been started in the schools. Again, a government in a hurry to get nowhere. Does this mean that they have misallocated their resources? I, for one, find this especially confusing, since I had been proclaiming for years the advantages of implementing this program in the schools, in a national, uniform, integrated, non-separate educational system costing much less.
The Anti-Inflation Board is another excellent example of the government spending millions to save thousands. Certainly this is not good economics or business sense, but it is typical government arithmetic. This demonstrates, most definitely, the lack of management qualities on the part of the government. The member for Restigouche (Mr. Harquail) has accused the provincial government of New Brunswick of spending federal moneys poorly. I cannot dispute this statement and might add that this particular money was probably used to pay for the steering-wheel of a Bricklin. My only hope is that the federal government is not trying to compete with the New Brunswick government to see who can spend most money most frivolously.
Possibly it would help if the government were to take a constructive look at the departments which require a good deal of house-cleaning. For example, let us consider the Department of Manpower and Immigration. I wonder if hon. members on the government side have any idea what happens when a person attempts to apply for employment with the Manpower department. I will give you an example. One unemployed young person entered an Ottawa Canada Manpower office and had practically to force the employee to register him as unemployed. This could be one reason why the employment statistics are only a facade to cloak the distasteful facts which would not show the government in good stead. At this point the constituent consulted another person to see if the Manpower office would inform him if a position was available. The reply, of course, was "not likely", and the applicant would have to return to the office each day to see if any positions were vacant. Approximately one month later the constituent received a form asking whether he was employed. The office of Manpower had provided no assistance to the person, although there were enough employees in the office to go in groups knocking on the doors of employers.
Is this any way to operate an employment agency? Is that restraint? May I remind the government that before one can provide employment, one must destroy the irregularities and inefficiencies of the employment agency. We have another excellent case here of too many people in an office providing too few services. This is not the fault of the employee but of the system; a system for which the government is responsible. In the government of Canada publication, "The Way Ahead: A Framework for Discussion"-which, again, was probably published at great cost to the taxpayer-the government has stated that in formulating their fiscal policies they intend to "seek the advice and views of all Canadians." It is amusing to

note the sincerity of the government in print, but on the floor of the House of Commons they have done nothing but criticize the constructive opinions of those hon. members kind enough to list alternative ideas for the betterment of the country.
It seems that if the government employed a little business sense and the advice of their counterparts in the House, we would have a significantly more efficient civil service and, hence, a more profitable and productive government. For this reason, I feel that the government should take a closer look at the restraint measures inherent in Bill C-19. Since the repeal of section 272 of the Railway Act has received much unfavourable consideration in the House over the past few days, I would suggest that the members on the government side consider amending this proposed legislation, instead of merely employing their majority status to pass legislation which obviously is not to the advantage of Canada as a whole.
This bill on government restraint does not go far enough in cutting out government waste, duplication and inefficiency. It does nothing to increase productivity. It goes too far in repealing section 272 of the Railway Act. If the Minister of Transport would withdraw that particular clause, I sincerely believe the bill might go through smoothly. As things are, it seems he is desirous of having the House continue to waste time. The government should cut down its expenditures and give us honest administration and good government. This is not the way to do it.


Mr. William Skoreyko (Edmonton East):: Mr. Speaker, I thank you for giving me the opportunity to speak on Bill C-19. I did not have the opportunity to make any remarks during the debate on the Speech from the Throne, but after I had an opportunity to examine Bill C-19 I thought, "I now have my opportunity."
I have listened carefully to what has been said in the last few days in the discussion pertaining to Bill C-19. It never ceases to amaze me that some of the members who sit across the way are so concerned when we attempt to deal with the problems the government is facing in terms of restraint. One would think they would be happy to hear about the situation as we see it and the solutions which we believe to be necessary. A bill such as the one before us concerns all phases of government-the entire spectrum of government. The only way in which it can be meaningfully discussed is by covering every area in which restraint programs have been or could be introduced. What this bill needs is not a six months' hoist; it needs to be replaced by another bill which might be called, for example, an expenditure control bill.
Looking at this measure, we find it is an act to amend or repeal certain statutes to enable restraint of certain government expenditures. What expenditures? The ones we are primarily concerned about as an opposition have not been mentioned. The government wants to deal with adult occupational training. Well, I think that if they were to scrap the whole bill it would not amount to a saving of much more than "Air Lang" which has cost the Canadian people a great deal
November 30, 1976

of money. The best thing about this bill is the proposal to scrap the Company of Young Canadians. While they were at it, I do not know why the government did not deal similarly with the OFY and LIP programs, too. I have some sympathy with LIP, though. I have suggested on more than one occasion that the government would do me a favour if they took my LIP program and gave it to areas where it was really needed.
Another part of the bill concerns family allowances. I shall have more to say about that in a moment. I can never understand why money is paid under this act to people who really do not need it, and recovered by way of income tax so that it can be redistributed. Then we come to the limitation placed upon industrial development incentives cutting out applications as of December 1, 1976. I really do not know whether in the end this will result in meaningful savings. The legislation setting up Information Canada is to be repealed. Why this organization was set up in the first place is beyond me. I do not know what was wrong with the earlier set-up under Statistics Canada. Other clauses in the bill have to do with the western grains stabilization act. Then there is a proposal to repeal section 272 of the Railway Act. This, as one hon. member has pointed out, will serve to benefit Montreal at the expense of the Maritimes.
What is the bill likely to achieve in terms of restraint? The best way for the government to achieve its target and stay within its guidelines is seriously to consider appointing a comptroller of the treasury, someone who would approve expenditures, someone who would give final approval to expenditures prepared for payment by the respective departments and take responsibility for them. In certain respects, cutbacks in departmental expenditure, though a long-established practice, discriminate unfairly against taxpayers in certain regions. For instance, this year's budgetary restraints imposed upon the Post Office Department can hardly be termed reasonable in light of recent increases in postal rates. In any case, they have serious consequences to people at the constituency level.
This is why restraints or cutbacks are unfair to certain groups of taxpayers. In any city, new housing developments are under way. Construction is commenced at different times, so completion time-frames will vary. As a rule, approval is granted for the development of projects adjacent to areas which are already developed. As these are started, further development permits are granted affecting new areas which are adjacent to areas already developed or to areas in the advanced development stage.


The Acting Speaker (Mr. Turner):: Order, please.
Department of Justice Act



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Turner):: It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised at the time of the adjournment are as follows: the hon. member for Vancouver South (Mr. Fraser)-Airports- Vancouver International; the hon. member for Cape Breton-East Richmond (Mr. Hogan)-Cape Breton Development Corporation; the hon. member for Halifax-East Hants (Mr. McCleave)-Urban Affairs-Sackville, Nova Scotia.
It being five o'clock, the House will now proceed to the consideration of private members' business as listed on today's order paper, namely, public bills.



PRIVATE MEMBERS' PUBLIC BILLS


Mr. Andre Fortin (Lotbiniere) moved: that Bill C-201, an Act to amend the Department of Justice Act (annual report), be read the second time and referred to the Standing Committee on Justice and Legal Affairs.
He said: Mr. Speaker, I welcome this opportunity to speak once more on Bill C-201. Since a copy of the bill was made available to hon. members and I have been putting forward this legislation during a number of legislatures, I sincerely hope it will meet with unanimous support in this House. It does not aim at a parliamentary revolution, but simply proposes to solve an anomaly within the federal government.
To explain the matter briefly, the federal Department of Justice is the only federal department that does not table its yearly activity report in this House. For this reason, Parliament has no control on the operations and financial administration of the department. Of course the department's estimates are referred to the standing committee as any other department's. But as I said, it is the only department that does not table an annual report. Therefore, as stated in the explanatory notes:



EXPLANATORY NOTES

[Stage Direction]
The Department of Justice is the only department which does not submit a report to Parliament. The purpose of this amendment is to correct this anomaly, to insure a better parliamentary control of the Department...
-by members of this House, and above alland to improve its efficiency.
[Stage Direction]
November 30, 1976
Department of Justice Act
Mr. Speaker, the amendment reads in part:
... on or before the 30th of September next following, or, if Parliament is not then sitting, on any first five days next thereafter that Parliament is sitting, submit to Parliament a report showing the operations of the Department of Justice for that fiscal year."
To me, it is not so much the date suggested in the said clause which is important, but rather the rule requiring that the department should file his annual report as the others do.
Now, Mr. Speaker, if for administrative reasons, the date above were enough to entail disregard of the rule and thus break the unanimity of hon. members, I would accept an amendment to the bill to make it acceptable to all members of the House since the main thing is to enable hon. members to get acquainted with the internal administration of that most important department.
1 have nothing more to add, Mr. Speaker, because I would like some of my colleagues to voice their views and more especially to have that important bill passed today.
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I want to congratulate the leader of the Social Credit Party, the hon. member for Lotbiniere (Mr. Fortin), for bringing in this bill. I feel there should be a report from the Department of Justice, as one who has been actively engaged in matters affecting the administration of justice for a number of years in this House. It is one of the most important departments of government. Without the administration of justice and the proper administration of justice, without the real freedom that flows from the rule of law which is the very basis of our parliamentary and democratic process, everything else, of course, fails.
I am interested in this bill and I give it my whole support. I am not going to talk for too long, but I want to mention a few of my concerns about why there should be a report. There has, of late, been a very serious situation in the administration of justice across the country with reference to the various attorneys general's departments of the provinces. I refer to the question of privacy.
Last session we were severely criticized for opposing Bill C-83. If Bill C-83 had gone through, it would have allowed electronic devices to wiretap people's telephones all across the country so as to enable others to listen in on private conversations, receive private information, industrial, corporate and individual data and private conversations generally. No doubt, as we have seen in the famous case under the Nixon administration in the United States, wiretapping would even enter the political arena.
Bill C-83 removed the necessity for giving notice to an individual whose telephone was to be wiretapped by an electronic device. I opposed that removal, not only on second reading but strenuously in the Standing Committee on Justice and Legal Affairs. The best we could squeeze out of the Minister of Justice (Mr. Basford) and the former solicitor general was that notice would have to be given within a period

of five years. Well, Mr. Speaker, Five years is a long time and most people whose telephones were being wiretapped would have left the country, or at least left the community and moved on somewhere else.
I contend that the provision in the Criminal Code that notice must be given within 90 days must remain in the Code. Both I and my party are in favour of providing that an extension at this time could easily be sanctioned by a judge if the necessity arose, for example when investigating syndicated crime. Secondly, there has been a long-established principle in the administration of justice that in order to protect the liberty of the individual a conversation between a person and his solicitor or counsel is privileged and confidential. Even a conversation between a patient and a doctor is not privileged in court, whereas a conversation between a solicitor and his client is confidential.
The reason for this practice, which has grown up in our common law over many centuries, is that the individual must be protected against the all-powerful state. But what has been taking place in this country, not only in the province of Ontario but in other provinces? Even the province of Alberta is now wiretapping conversations between lawyers and their clients. One might almost suggest that now we will have to remove telephones from law offices.
I have had one example of this brought to my attention, Mr. Speaker. I have no proof that it has happened, but I have certainly had letters to this effect. I agree it is an extreme case, but it does deal with the question of privacy. If a lawyer visits a client while he is incarcerated, having been charged with the commission of a crime that calls for him to remain in jail, the little rooms where you interview your client have been electronically wiretapped. This is an erosion of the fundamental principle of privacy and a breach of the most fundamental principle of civil rights.
A third matter that I think might bear some reporting is this: there has been a long-standing principle that anyone charged with an offence, no matter how heinous the offence may be, has the right to remain silent. Not too many people realize that this principle exists. When a person charged with an offence is on trial before a judge and jury, or before a judge without a jury, he need say nothing. The onus is on the Crown to prove the case beyond reasonable doubt. When I use the term "beyond reasonable doubt", I mean the kind of doubt that any reasonable man might have in his business affairs, or in dealing with his family matters, or that a woman might have when dealing with her family or business matters.
A practice is now developing across the country whereby the police are able to do what the courts cannot do. A judge cannot ask a prisoner in the dock, "Were you there? Tell me what happened". The rules relating to voluntary statements are being usurped. I cannot go into the details because there is a case right on this point, but in some types of murder there may be a question of the prisoner's insanity and he is sent to a mental hospital to undergo psychiatric treatment by psychiatrists and psychologists and other scientific and technical personnel skilled in medical and psychological experimenta-
November 30, 1976

tion. That information is then given to the police or to the Crown. Surely an interview by a psychiatrist who asks questions about the background of an individual, his childhood environment, his problems at school and with his parents, perhaps a division in the home, problems in the community, business arrangements and reaction to certain circumstances, could not be admitted unless it was given voluntarily as a statement to the police. This is an attempt to get in the back door what cannot be got in the front door.
I know of a case involving an individual confined to a mental hospital following the most serious charge of murder. He was taken out of the mental hospital for a remand in court some five hours before he was needed. He was interrogated for at least 2Vi hours. How could such a statement be voluntary? The fundamental rules of jurisprudence which we follow establish as a test whether the statement is true or false, and how could you decide that when it was made by a person confined to a mental institution? If that does not cause frustration among defence lawyers across this country, and does not represent an erosion of civil rights, then there is no frustration and no erosion of any kind.
I could continue to talk on this matter for quite some time, but I do not wish to delay this measure. It is an excellent bill and it will receive my support. These matters should be reported to parliament, because in this way the representatives of the people of Canada would have this information which too often is denied by the executives of governments today.


Mr. Mike Landers (Parliamentary Secretary to Minister of Justice):: Mr. Speaker, as I rise to speak on the matter presently before this House, may I first take this opportunity to congratulate the hon. member for Lotbiniere (Mr. Fortin) on his recent election as leader of the Social Credit Party. If the hon. member is able to lead with the same wisdom and insight as his predecessor did, Canada will be well served.


Some hon. Members:: Hear, hear!


Mike Landers: As this House already knows, Bill C-201 as proposed by the hon. member for Lotbiniere would amend the Department of Justice Act, Revised Statutes of Canada 1970, chapter J-2, to provide that the Minister of Justice shall submit an annual report to parliament on the operations of the department. The report would be submitted after the termination of each fiscal year, or on or before September 30 next following or, if parliament is not then sitting, on any first five days next thereafter that parliament is sitting.
The Department of Justice has not been required to submit an annual report in the past because its primary responsibility or function has been to provide legal services to other departments and agencies of the government. There has existed, and still exists, a solicitor-client relationship between the Department of Justice and the other departments and agencies it represents. However, in recent years the department has expanded its role by becoming involved in new programs
Department of Justice Act
relating to legal research and law reform and other programs such as cost-sharing of legal aid services in Canada.
In view of these new activities, it is perhaps time that an annual report such as proposed by the hon. member should be considered. A report of this nature might provide the public with more and better information than is now available concerning the activities of the department. Members of this House may be interested to know that the departmental counterpart in the United States submits an annual report which is very informative and interesting.
There is one minor objection we have to the bill, and it is that the bill does not provide for a sufficient period within which to file the annual report. In this regard it should be noted that chapter 24, R.S.C. 1970, provides that the Minister of Communications has until January 31 next following the end of any fiscal year within which he or she shall submit an annual report on the operations of the Department of Communications. Similar statutory provisions exist in respect of other departments such as the Department of Consumer and Corporate Affairs and the Department of Energy, Mines and Resources. In recent years this date has been found to be more practical or useful in terms of available information and the ability of the departments to produce it.
In view of the foregoing, Mr. Speaker, we have no objection to the bill, provided that it is amended so as to delete the phrase "30th of September" and substitutes therefor "31st day of January". I am pleased to learn that the mover of this bill is agreeable to the proposed amendment.
The Minister of Justice, the Department of Justice and the Parliamentary Secretary to the Minister of Justice welcome this opportunity to continue with our long-established policy of responsiveness and openness in our ongoing efforts to ensure justice for all Canadians. This private member's bill gives us the opportunity to display, once again, our flexibility; to show, through action, that the Minister of Justice is both receptive to and appreciative of ideas from members of the House of Commons without regard to where they may sit in this chamber.


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Question.


The Acting Speaker (Mr. Turner):: Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Justice and Legal Affairs.
Steve Eugene Paproski: Six o'clock.


Stanley Howard Knowles: After that we might as well call it six o'clock.

November 30, 1976
Restraint of Government Expenditures


The Acting Speaker (Mr. Turner):: Is it agreed that we call it six o'clock?


Some hon. Members:: Agreed.


The Acting Speaker (Mr. Turner):: It being six o'clock, I do now leave the chair until eight o'clock p.m. this day.
At 5.20 the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.


[Stage Direction]
The House resumed consideration of the motion of Mr. Andras that Bill C-19, to amend or repeal certain statutes to enable restraint of government expenditures, be read the second time and referred to the Standing Committee on Miscellaneous Estimates, and the amendment thereto of Mr. Holmes (p. 1393).
William Skoreyko: Mr. Speaker, at five o'clock I was talking about the voluntary restraints that were implemented by the Post Office Department and what I thought was the unreasonable position in which that placed many people in this country. I was talking about developments in the cities and what happens when there is a restraint program arbitrarily agreed to within a department which affects areas where development takes place after the imposition of the controls.
The point I was trying to make was that the injury resulted when one project or one district had been completed and mail delivery service had been instituted in that area, but because of the imposition of a restraint program a few months or a few weeks later, an adjacent area which had taken longer to develop and become a fully residential area was denied the same service simply because it was caught in the middle of the program. This kind of program is unfair and unwarranted. A cut-back in any department should be of such a nature that it does not discriminate, and it must have the same impact on all.
In the last decade even though the Post Office Department has experienced a 50 per cent increase in staff and a 50 per cent increase in the cost of operation, together with a recent increase in the price of postage, it is strange that the service has deteriorated to an intolerable level. There is no question in my mind that some form of action on the part of the government is long overdue.

Bill C-19 is an attempt to plug a leak in the dike. I want to talk for a few minutes about the Company of Young Canadians that was brought into being by the late Lester B. Pearson. The tale is told in a book entitled "The Big Rip-off," written by a lady by the name of Erna Koffman. It clearly illustrates the fumbling, bumbling, mismanagement, deceit, and distortion which took place not only within the confines of the political offices responsible for the program but also within the sanctions of the public servants responsible for its administration. In retrospect one would think that the players in this CYC game outside the realm of politics were selected on the basis of their incompetence to perform within the intent of the legislation, with unexcelled competence to milk the system.
No one was more pleased than I to see the Company of Young Canadians go down the pipe, regrettably too late, after the program had cost the people of Canada millions of dollars. What did Erna Koffman say about the program and some of its activities? How did the program work? For the record I should like to read one paragraph from the book "The Big Rip-off' which I think deals very clearly with how responsible were the administrators of that program. This is what she had to say:
Theoretically, any community in Canada that wanted to embark on a self-help programme could request the services of a 'volunteer' of the CYC. However, since shortly after its inception, the CYC has run into flak, and criticism has poured into Ottawa from many parts of the country where the CYC has been operating, accusing the Company of stirring up trouble or encouraging troublesome elements in Communities. The Premier of one Western Province ordered the Company out of his province. It seems that wherever there are civic disturbances, CYC workers seem to be around.
We talk about restraint, yet this government put millions of dollars into a program which was responsible for this kind of activity.
I wonder if the government still thinks that a comptroller general, a chief financial officer, could not have prevented this kind of waste of public funds relative to this program. Does the government not now feel that this most significant recommendation of the Auditor General should be acted upon immediately, pending findings of the commission set up to investigate government spending? We do not need a royal commission to tell us that a program is wrong in principle, that it is mismanaged and far too expensive. According to Bill C-19, the CYC program would now be cancelled as part of the restraint program. That is like locking the barn door after the horse has been stolen.
What did the program achieve? It served to inform the taxpayers of this country that, in the face of growing unemployment, stop-gap programs were not the answer. It served to inform the Canadian public that a sound economic policy was lacking. The program told us that stop-gap programs were not workable when-in the absence of sound economic policy and good sense taxes were rising, welfare programs were strained and the cost of living was rising-the government poured millions of dollars into programs which only aggravated the unemployment situation. What we expected to see in Bill C-19 was not the cancellation of a program which should never have
November 30, 1976

begun, but positive steps to demonstrate to this House that the government is serious in its announced desire to curtail spending, and particularly irresponsible spending.
Every member of this House is concerned about the statement made by the Auditor General that he fears parliament and, indeed, the government have lost control over spending. What has been a matter of concern to members of parliament for a number of years has been forcibly brought to the fore by none other than the man who audits government accounts. Committee recommendations and pleas by members of parliament have been ignored, and I ask if the government is now going to ignore the warnings of J. J. Macdonell.
What did Mr. Macdonell say in his warning to the government? I wish to quote from an article written by Michael Van Dusen of the Financial Times services and printed in the Edmonton Journal of November 23. It is an article entitled "Crown Corporations Spend Without Control". I will only put a paragraph of this on the record. This is what Mr. Van Dusen said:
Underlining the inadequacy of the controls the federal government budgetary expenditures were $34 billion in 1976 but only 34 man-years were devoted to financial administration policy and evaluation-about one man year per billion dollars.
Is this a proper ratio by which to effect controls? I suggest it is not.
What are some examples of what the Auditor General was talking about? Mr. Van Dusen talks about $4 million and other considerations valued at $702,000 plus an annual rent of $241,000, paid by the Department of the Environment for 55 acres of waterfront property in Vancouver. The property was rented by the former tenant for $48,180 per year. It was from this tenant that the government had originally acquired the leasehold.
The second point about which the Auditor General is concerned, and which is dealt with in this article, is the $828,000 which was spent by the Canadian International Development Agency for the purchase and modification of a boat which was destined never to sail, and a fivefold over-expenditure of $559,000 by the Public Service Commission staff training and development fund for which the commission asked a compensating appropriation of $747,000 in the next budget year, $200,000 more than they really needed.
I want for a moment to talk about government office space waste which is equal to 139 football fields. I am referring to an article written by Don Sellar which was printed in the Edmonton Journal, and my constituents are very much concerned. This article refers to the Auditor General and says:
Applying the government's own guildelines for office requirements, he concluded that the bureaucracy occupies more than 30 per cent more space than it ought to.
What the auditor-general doesn't say in his annual repdrt, tabled Monday in Parliament, is that this situation is likely to worsen in the years ahead.
I can understand why this cabinet occupies 30 per cent more office space than it needs. This cabinet is fat and complacent and not willing to govern. I can understand why it occupies more space, but why does the bureaucracy occupy more space
Restraint of Government Expenditures than necessary? The Auditor General pressed for information with respect to these leases and with respect to the projected requirements of this excess space, and that information was denied. Mr. Sellar went on as follows:
After looking into the process by which eight federal departments and two agencies determine their additional space requirements, he finds there is an "absence of sufficient documentation to justify requests for space."
Even worse, there is no procedure whereby the Department of Public Works can reclaim surplus offices for reallocation to other departments or agencies.
The way the government accommodation game is played, it seems that once a department manages to wangle some office space, there is virtually no way DPW can get it back, even if the rooms are vacant or "under-utilized."
I simply ask, who in government has the responsibility in this regard? The article goes on:
"In 13 cases... documentation was insufficient for our purposes or was unavailable," the auditor-general says, more in sorrow than in anger. "In the other five, examination of the reported figures revealed that space use exceeded the relevant guidelines by more than 30 per cent in three cases."
One departmental horror story uncovered by the special inquiry occurred 15 months ago when an organizational unit moved into 103,000 square feet of new office space, including 18,000 square feet reserved for two new activities which should be getting under way now.
They may not get under way in the next 18 months. I do not need to bring to the attention of the House any more of the warnings of the Auditor General to parliament or what the Auditor General wants us to do, but I am saying that there are people in the cabinet who must be responsible for this phase of government, and it is incumbent upon them to act.
With regard to the Family Allowances Act which is dealt with in Bill C-19, for years some of us in this House have advocated the removal of the universal aspect of this legislation. Many millions of dollars could be saved simply by changing the fund so that it pays only on application. The family allowance serves a useful purpose, but its usefulness becomes questionable when universality is applied. Rather than take the course the government has taken, namely, to freeze at the 1975 level the rates at which amounts are paid to residents of provinces specifying rates for family allowance, the universal aspect should be reviewed immediately.
The government could also save money on administrative costs by not pushing out cheques to people who do not want or do not need them, and if the Income Tax Department refused to take back money that was paid to taxpayers by way of family allowance only to redistribute it again in the next year. The government should act as quickly as possible to set the upper limits of qualification for family allowance by statute, and forget the freeze. It seems to me that would be a more equitable distribution of the taxpayer's dollar.
Information Canada has been scrapped. I do not know what the Prime Minister (Mr. Trudeau) intended when he put this little entity together. What was wrong with the Dominion Bureau of Statistics-except the name "Dominion"? All I can say is that Information Canada is good for the government if the government is good, but it is bad for the government if the government is bad. I suggest to you that is why Information Canada is now something in the past.
1530

November 30, 1976
Restraint of Government Expenditures
Let me go back for a moment to something that happened in this House a few weeks ago. I want to speak now about restraints in the bilingual program. Nothing could be further from the truth, Mr. Speaker, as millions of dollars were spent on an all out crash program to immerse senior civil servants in French language programs. The result was that very few used the language, and most did not use it at all after the immersion and the heavy cost to the Treasury.


An hon. Member:: Whose fault is that?


William Skoreyko: Somebody asks what is wrong with that.


An hon. Member:: I said whose fault?


William Skoreyko: The Liberal government's fault. A duplication of complete staff is not necessary in order to provide bilingual service to the people of Canada. A proper approach would have been to adopt the recommendations made by some members of parliament in speeches in this House in 1969 when they advocated a policy of national education in both official languages.


An hon. Member:: Nonsense.


William Skoreyko: That is what the government has announced in the Speech from the Throne. If that is nonsense-


The Acting Speaker (Mr. Turner):: Order, please. Would the hon. member get back to Bill C-19?


William Skoreyko: Mr. Speaker-


The Acting Speaker (Mr. Turner):: 1 would suggest that he get back to the bill and cut out the crossfire.


William Skoreyko: Mr. Speaker, I am amazed that I should be reprimanded when I have to respond to the jackals across the way.


The Acting Speaker (Mr. Turner):: Order, please. I said all members should get back to Bill C-19.


William Skoreyko: Mr. Speaker, I was on Bill C-19 when this jackal indicated to me that the Speech from the Throne was nonsense. I had to respond and tell them that I thought the government was serious.


Stanley Howard Knowles: Call them hon. jackals.


William Skoreyko: Hon. jackals. I have just been corrected by the hon. member for Winnipeg North Centre (Mr. Knowles).


An hon. Member:: It takes one to know one.


William Skoreyko: Let me make it clear that within an acceptable time frame certain positions in the civil service could have been declared bilingual and then filled by way of promotion. Then it would not have been necessary to immerse senior civil servants at 55, 56 or 57 years of age.

A program designed to educate the children of Canada in both official languages-French in the rest of Canada and English in Quebec-commencing at grade 1, would have allowed an orderly transition from primarily a country with two official languages but separated by regions, those regions not being able to communicate with each other in the language of their choice. In a decade or two the problem would have looked after itself simply by implementing the education of children in the other language at the grade school level. In the context of a restraint program all of this would have had a noticeable effect in the intervening years.
A federal-provincial conference could have been held to determine on what basis the provincial governments wanted to approach the program. I suggest a per capita grant could have been offered by the federal government to every province that wanted to participate. Would this not have been the better solution in 1969 than to go on to a crash program and try to immerse 55 year old civil servants in a French program, and then retire them two weeks after they graduate? I will say no more about this program, Mr. Speaker, except that some of us who advocated this as far back as the day it was thought of are now vindicated because in the Speech from the Throne the government announced this course of action.
There is one final statement I want to make about something that was raised in the House earlier this afternoon by the hon. member for Edmonton Centre (Mr. Paproski) and the hon. member for Pembina (Mr. Elzinga). They raised the question of restraint as it concerns the Department of National Defence. I think this is the worst possible example of restraint I have ever heard of, and I refer to the removal of the airborne regiment from Edmonton to Petawawa. The Department of National Defence knows as I do and as a great many members of the House do, that the regiment is based in Edmonton primarily because of that city's proximity to the gateway to the north in terms of commerce, aircraft usage, and search and rescue.


An hon. Member:: It is the last place to be.


William Skoreyko: In terms of response to search and rescue requirements the extra time required will undoubtedly cause unnecessary suffering and indeed death, particularly in the winter months. Weather in the north poses serious hazards to both aircraft and victims in incidents requiring search and rescue. Where does this restraint fit into the transfer plans? As I understand it, aircraft maintenance will remain at Namao as will the storage facility. The hon. member for Edmonton Centre has indicated to me that $60 million or $70 million was spent to build underground storage facilities. If they had to be built somewhere else today they could cost $120 million to $125 million, so where is the economy in moving the regiment out of Edmonton? Is the truth of the matter the fact that the government intends to turn that base over to Strategic Air Command of the United States for operation?


Some hon. Members:: Oh, oh!
November 30, 1976


William Skoreyko: They were there before. The hon. member seems to know all there is to know about Namao. They had been there for years and were ordered out about ten years ago. Now they are back. I wonder what the hon. member would do with Namao-if he knows where Namao is. 1 do not think he does.


Some hon. Members:: Oh, oh!


The Acting Speaker (Mr. Turner):: Order, please. The hon. member for Edmonton East (Mr. Skoreyko) has the floor. I suggest we listen.


Some hon. Members:: Hear, hear!


William Skoreyko: Thank you, Mr. Speaker. I have always regarded you as a fair man and I thank you for the intervention.
If the Department of National Defence does not intend to maintain the air base in Edmonton, what will it do with it? We want to know. If they are going to close it, will they dispose of the land? If so, to whom will it be made available? Will it go to the city of Edmonton, or the province of Alberta? Also what will they do about the 1,200 homes being vacated in the Namao air base? Perhaps they will move the army into Namao and then use a minimal air force backing complement. If that is the intention, think of the many millions of dollars which will be involved in that development, in that particular region. And for what will the money be spent-to put light infantry in, supported by half a dozen aircraft? Is that the reason?
Why does the government not want to tell the inquirers, the people who are concerned in the region, people like the mayor, the business community, and other people in Alberta who are seriously concerned about the economic effects on the region and over the months consistently have asked, as have members of parliament, what the department intends to do in this regard? Mr. Speaker, the response has consistently been subtle: "We don't know what is happening." What they did not tell us was that they would not make up their minds as to what was to happen in Namao until the situation in London had been resolved. One can see the picture emerging. Since they decided to maintain the London operation, Namao had to go, had to be vacated.
As a politician I suppose I could go back to my people and say, "Ladies and gentlemen, if you had elected Hu Harries, and you did not because he was not a good member of parliament, he might have wielded some influence." I do not think there was any hope for a Liberal to be elected in Alberta; the people would not have returned a Liberal member even if the entire Department of National Defence had moved to Calgary. But, because they took the air borne regiment out of the region they have guaranteed that until at least the year
2,000	not one Liberal candidate in the province will have a chance of succeeding.
Restraint of Government Expenditures


Steve Eugene Paproski: Even the children of Liberals will vote Conservative.


William Skoreyko: There is no point in mentioning our concern with regard to Namao to this unresponsive government.
In my limited time I wish to touch on several more points. Let me talk for a moment about unemployment insurance. It was so easy for many years to get unemployment insurance that abuse was invited; yes, the scheme was taken advantage of. Then, when the minister realized that the operation was a couple of million dollars in the hole, he decided to make unemployment insurance so difficult to obtain that it is almost impossible to qualify for it.
And what has the government done in the field of medical research? Medical people consistently come to parliament on their hands and knees asking for assistance, and almost as common as the common cold are announcements in newspapers that someone has died of cancer, of heart disease or kidney disease. Mr. Speaker, medical people are interested in obtaining research money. If you want to know where the government has practised restraint, I will tell you-in medical research in this country. This wasteful government cannot afford to give money for medical research but can embark on some of the wildest schemes you can think of, without batting an eyelash.
While we are speaking of restraint let us touch for a moment on the Department of Transport. The government had no money to invest in medical research but it could afford money to build that monstrous airport at Mirabel, which few wanted and few want to use. It cost the taxpayers of this country in excess of $1 billion. I am told that the loss in two years amounted to $66 million. 1 think I am correct. Think how much medical research could have been undertaken with that $66 million. That money might have been instrumental in bringing about cures for ailments one sees in this country. It seems to me the government has its priorities mixed. I wonder if the minister will not agree in retrospect that it would have been better if the government had chosen to place the new international airport in the Ottawa Valley or the Ottawa region instead of at Mirabel.


An hon. Member:: Deal with Joe Guay's salary.


William Skoreyko: I have not come to that yet. Why did the government decide to put the second international airport at Mirabel, at Ste. Scholastique. What was wrong with Dorval? In my view Dorval is a much better airport, and certainly a much more usable airport than the one at Toronto. In my estimation Dorval was never used to capacity. It could have been expanded to accommodate more international flights. If another international airport was really needed, and 1 am relating my remarks to restraint proposed under Bill C-19, why could the government not have picked an appropriate site in the Ottawa region, to accommodate Toronto, Ottawa, and Montreal? Why did it build the billion dollar airport at Mirabel? It should have built perhaps an even bigger airport in the Ottawa region.
80005-291/,

November 30, 1976
Restraint of Government Expenditures
We did not need Mirabel, or Pickering; I say this because one has merely to look at government policy in relation to air traffic. It seems strange that only in the last six or eight months have I been able to take a direct flight from Edmonton to Ottawa. What was wrong with government policy? It thought the international airport at Toronto was congested and said, "We must build Pickering; we have to spend more of the taxpayers' money". Mr. Speaker, governments must not find excuses for spending taxpayers' money. They are elected to spend the taxpayers' money responsibly, and as wisely and efficiently as possible.
The government should have spoken to the management of Air Canada and Canadian Pacific Airlines and said, "Sirs, we need direct service from Vancouver to Montreal, Vancouver to Toronto and Vancouver to Ottawa, and direct service from other cities in western Canada to cities in eastern and central Canada." Perhaps that way the expansion at Toronto international airport would not have been so urgently needed. Perhaps the Minister of Transport (Mr. Lang) can tell me why I had to take a DC-8 flight from Edmonton to Toronto, and at Toronto catch another flight from Calgary or some other point in Canada which continued on to Ottawa.
It was said that there was not enough business to justify direct service. I do not know about that. It was not introduced for many years, even though we had advocated it in the House of Commons. Now it is being provided and all of a sudden you find that Air Canada has put a Boeing 727 on the route and it is full most of the time. You sit on the flight and you find yourself squeezed in between-


An hon. Member:: Otto Lang.


William Skoreyko: Well, they are pretty big fellows. I had to get off that Air Canada flight, for which allegedly there was no business. That was no excuse or justification for not providing a direct flight. As I said, I had to get off that flight-


The Acting Speaker (Mr. Turner):: Order, please. I regret I must interrupt the hon. member whose allotted time has expired. He may continue with the unanimous consent of the House. Does the hon. member have unanimous consent?


An hon. Member:: No.


Mr. Benno Friesen (Surrey-White Rock):: I think that the members on the government benches will be sorry they did not let the hon. member for Edmonton East (Mr. Skoreyko) finish his speech. He was winding up his remarks. I always appreciate the hush which comes over the House when I rise to speak, the hush of anticipation.


An hon. Member:: Of utter shock.


Mr. Buchanan:: A deadening silence.


Benno Friesen: When the hon. member for Edmonton East was talking about the movement of the airborne division from Edmonton to camp Petawawa in Ontario it reminded me of

the election campaign of 1965 when the then prime minister, Mr. Pearson, was going around the country saying, "Please give us a stable government". I remember hearing the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), who was leader of the NDP at that time, speaking in the Vancouver Forum saying, "The prime minister says that the Canadian people should give us a stable government. Well, we have a stable government. It is so stable it smells like a stable." Those were the days when they had horses on the payroll at Petawawa.


The Acting Speaker (Mr. Turner):: Order, please. I suggest to the hon. member that he get back to the terms of Bill C-19.


Some hon. Members:: Hear, hear!


Benno Friesen: Well, Mr. Speaker, I was just leading into that because I thought that little anecdote, which comes from the annals of the Liberal party, was a pretty good introduction to the title of this bill, because the days when they had horses on the payroll in Petawawa have their counterpart in the way the government operates today. Today we are debating Bill C-19, "An Act to Amend or Repeal Certain Statutes to Enable Restraint of Government Expenditures." It is a very welcome title-it almost makes your heart skip a beat. One is encouraged because one believes that finally the government is serious about restraint. But then you read through the bill and your encouragement changes to discouragement. You realize that the bill is another example of a public relations job and that the government is not talking about restraint, it is talking about petty cash. It spills more than it is trying to save in this bill.
I do not think we ever want to turn down an opportunity to save the taxpayers' money, but this bill is rather like a leper going to a clinic saying, "I do not want the cure. All I want is something to cover the gangrene."
I should like to deal with just three of the aspects of this bill and draw the attention of hon. members to what I think is a piece of sham which the government is perpetrating on members of the House, and certainly trying to perpetrate on members of the public. When we turn to clause 3 of the bill we find that under this clause the Company of Young Canadians shall be deemed to have ceased to exist on April 1. Then I look at the budget of the Company of Young Canadians and I find that in 1973-74 its expenditures amounted to $2.8 million, and in 1974-75 to $3,722 million. The forecast for 1975-76 is $5.5 million. As I have mentioned, the Company of Young Canadians was deemed to have ceased to exist on April 1, 1976. Then I turn to the Auditor General's report at page 24, where I find that, immediately before the dissolution of the company, severance payments totalling $185,500 were made to volunteer members. Whoever heard of volunteer members getting severance pay?
I thought that if you volunteered to work for an organization, you were a volunteer. Yet we have the ludicrous situation of people supposedly being so caught up with the ideal that the government presented to them in the Company of Young
November 30, 1976

Canadians that they volunteer their services to the Canadian people for the betterment of Canada, and now they are being given severance pay. As a cute addendum to that I notice that the government did not even have the authority to make that kind of severance pay to the CYC. That is the kind of thing we are facing in this bill. We are dealing with something that no longer exists. We are dealing with one of the smallest budget appropriations that we have in the budget estimates, and we are dealing with the case of the government taking upon itself an authorization to which it had no right.
Meanwhile, back at the ranch, we have Quick Draw McGraw and Baba Louie. To represent those characters you can pick any two of the ministers in the front row. For convenience's sake we can take the Minister of Energy, Mines and Resources (Mr. Gillespie), and his sidekick, the Minister of Finance (Mr. Macdonald). Here we have a discussion of $5 million to be saved by the dissolution of the Company of Young Canadians, while these two gentlemen are saying, "What do you know, we would like to sell some atomic reactors to foreign countries. Let us look around for good salesmen. What is their commission? We won't bother about that. We will come to that two years later when people start asking questions. But if the commission comes to $20 million, as it has now, what is the difference? It is only $20 million".
Then we have the Prime Minister's (Mr. Trudeau) casuistry today when in effect he said, "Sure, the former auditor general wrote to me three and a half years ago and I passed the letter on to the then president of the treasury board. I asked him to look into it, but I heard no more, so what could I do about it? I mean, my hands were tied because they did not answer my note." Maybe that is a good indication of why the country is in trouble. We are faced today with the effrontery of the Prime Minister telling us that, since he heard no more with regard to the memo, he is no longer responsible. I would like to refer to the letter of March 27, 1973. Notice the casual tone that the Prime Minister used when he discussed this with the then president of the treasury board and said:
... I wonder if the best course might not be for you to organize a discussion of the question with Messrs. Turner, Goyer and Sharp.
He organizes a discussion about $20 million. Mr. Speaker, that was no time to organize a discussion. What we needed was an investigation, and three and a half years later the Prime Minister has the effrontery to say in the House that he tried but it did not work, that since it was a Crown corporation he cannot be held responsible for the $20 million. Today we are debating a $5 million appropriation to the Company of Young Canadians. It is just a sleight of hand trick. Get their attention, listen to what they are saying, but meanwhile watch closely what they are doing.
One of the clauses in the bill deals with the disbanding of Information Canada. I do not mind Information Canada being disbanded. Nobody will complain about that. It means the saving of another $10 million expropriation for an organization whose responsibility it was to make the government look good.
Restraint of Government Expenditures Now, as the hon. member for Edmonton East has said, it has outlived its usefulness and can be disbanded. This makes it look as though the government is really interested in saving public funds.
I turn now to another aspect of the bill and it concerns personnel rather than budgetary considerations. I have mentioned before in this House an occasion when, together with other members of the special parliamentary committee, I was moving across Canada to listen to what the Canadian people has to say on the subject of immigration. We came to Edmonton and, as was the case in so many cities, there were demonstrations against these so-called Fascist perpetrators who had come from the House of Commons and were talking about that racist green paper. The special feature of the demonstrations in Edmonton was the fact that the demonstrators were Maoists. Their signs said they were Maoists. They had a bulletin which they shared with anyone who cared to read it in which they advised that their next meeting would be held in the office of the Company of Young Canadians in Edmonton.
The saving of millions of dollars by disbanding the Company of Young Canadians is one thing. We are always glad to save public money. But for all those years it attracted people who were not interested in the welfare of Canada as we had known it. They were interested in using the finances and the mechanism of government to tear down Canada and its institutions. They were being funded by the government to bring about, to the extent they were able, the demise of Canada. This is another reason-and it is even more important than financial considerations-why the Company of Young Canadians should be disbanded.
To a lesser degree, the same is true of Information Canada. I am not by any means suggesting that Information Canada was a hotbed of revolutionaries or Maoists. But 1 am saying it was a superfluous organization. We have done without it for six months now, and I have not noticed that anybody has missed it. So there has been an appropriation of $10 million every year for very little purpose.
I suppose the government had the idea, when it was formed, that there would no longer be any necessity to maintain individual information centres within the departments, and so on. But what really happened? We found that each of the ministries still maintained its own publications office.
We ran into the same thing today when discussing the budget of the National Film Board whose branches include an agency for the processing and development of films for all the departments within the government. The budget runs to something like $1.3 million and it is supposed to service all the agencies of the federal government in Ottawa. One of the problems is that the government agencies in Ottawa are not using these services. They are still developing their own films, producing their own pictures, doing their own PR work, even though the Film Board has evidently-and we take their word for it-one of the finest labs in the country.
The same thing happened in the case of Information Canada, so I believe it is a good thing that the government has finally seen fit to disband that organization. Nevertheless, we

November 30, 1976
Restraint of Government Expenditures must look carefully at what is going on elsewhere. This represents a $10 million cut, but consider what is happening at Statistics Canada. One could go on to recite the endless litany of inequities there. One such case came to notice in the Ottawa Citizen of November 4. A respected columnist, a former member of this House, wrote:
With thousands of Canadian graduates unemployed or under-employed, the wife was given educational leave worth $13,000 to complete her BA. Chretien might be curious about why the wife was given her position at the agency if she didn't have the educational qualifications or why she was given a freebee to complete her education if her qualifications were considered adequate to hire her.
A lot of questions have to be answered about the hiring policies of Statistics Canada. I wonder how many millions of dollars are involved there.
We have often heard Mirabel mentioned in the course of this debate. We might adopt an American revolutionary slogan and talk about millions for Mirabel but not one cent for the farmers on whose land it was built. I recall that a year and a half ago there was a demonstration of farmers on the Hill. They burned bales of hay. These farmers owned the land upon which Mirabel was built. The land had been expropriated seven years ago but it had still not been paid for. Their property was taken away to make room for a multi-million dollar structure which is still partly vacant. We realize now that we never really needed it. We talk about saving $10 million on Information Canada. How many millions are involved in Mirabel? Four hundred million dollars?
The we move on to another chorus in the litany-Campeau Corporation. The Canadian people will be asked to pay an extra $300 million because of a deal the government arranged with regard to a long term lease which could have been obtained much more cheaply had it been done in another way. And so it goes on. While we talk about restraint in one area of government we waste money by the bucketful in others.
I should like to move on to clause 10, the clause which deals with industrial research and development. The act is to be amended to allow researchers to finish current projects. That is commendable. There are many good projects which would have otherwise been completely wasted. The legislation will eventually bring about the cessation of all research under this program. Being just a farm boy, I must say that a measure of this kind reminds me of a farmer who had a cow which milked very well but which ate voraciously. The farmer did not want to pay for the food the cow was consuming so gradually, day by day, he gave it less and less. "Finally," he said, "you know I almost had that critter to the point at which it did not eat at all, and then the crazy thing died on me."
On one hand the government talks about increasing productivity, increasing the gross national product. The Minister of Labour (Mr. Munro) is encouraging the unions to increase productivity. On the other hand the government is saying: no more research under our auspices.
I remember just about a year ago one of the members from eastern Ontario arranging for a group of members to take a tour of the National Research Council facilities in Ottawa.
This was a good gesture on his part and it certainly was a good experience for us. We could see exactly what the government was investing in research. It was an interesting trip. As we got off the bus, what did we find? There were about 50 or a hundred scientists walking around in hard hats picketing members of parliament because their research funds had been cut off.
Historically, Mr. Speaker, research scientists have not been picketers. We may not always agree with their projects, but believe me these scientists are not at home on the picket line. They are at home with a test tube, a Bunsen burner, a microscope, and all kinds of laboratory equipment. Theirs is the quiet world of the laboratory, not the picket line. But they were desperate. They saw years of experiments were going to go down the tube. They saw all their investment, ingenuity, creativity and time would now be wasted because the government was cutting off their funds.
It strikes me that Canada of all countries already has a record of being one of the most niggardly in the area of industrial research. I note that Mr. John Shepherd, executive director of the Science Council of Canada, has had this to say:
The spectacle of R & D budgets being cut, basic research being eroded, and federal stimulant programs under painful review has worked to make the climate for industrial innovation decidedly bleak.
Then I think hon. members will be interested in this comment:
However, Canada's performance in transforming ideas into products ranked with Portugal in a 1972 study. Canada and Portugal were the two countries in the western world where industry spends the least on industrial R & D as a percentage of total R & D spending.
Industry in Canada is not a good spender on research and I think needs to be jacked up in that regard. Nevertheless, the government has to complement what industry does. Right now it is doing this; industry is doing almost nothing and the government is doing almost nothing. But my point is that although industry is doing nothing, the government ought to be doing something.
It is also well known that multinationals in Canada are not continuing to do research. Why should they, Mr. Speaker? They do most of their research at their home base, which I think is not the way it ought to be. The government continually says that we should make our companies more Canadian, that we should Canadianize our industry.
Just yesterday the President of the Treasury Board (Mr. Andras) announced quotas for the textile industry because he wants to protect Canadian industry. How in the world can we Canadianize our industry if we cut off all research to Canadian industry? How will our research scientists live if the world of ideas is cut off from them? I think Mr. Shepherd put it very well when he said that Canada's performance in transforming ideas into products ranked with Portugal in a 1972 study. Transforming ideas into products is what research is all about. Yet government wants to cut off research funds, which I think is almost unforgivable.

November 30, 1976

Actually, Mr. Speaker, industry fares very well. Under this bill a researcher is at least allowed to finish his project. He can apply for a grant, sufficient not to waste his project. But with medical research there is not even the day of grace by which they must finish their projects. Certainly the Medical Research Council has not done as well as industry. 1 know a research scientist in Vancouver, Dr. Tze, who is doing research in diabetics, something that Canada is known around the world for pioneering. A year ago he was half way through a research project involving rats. Then the announcement came that his grants were going to be cut off, which meant that not only was his year's work done but that two or three years' work was done. The control group had no problem but the experimental group was killed off half way through the project. In order to start up again he would have to get another set and begin all over once more.
It so happened, Mr. Speaker, that someone got wind of this tragedy-perhaps I should call it travesty-and brought it to the attention of a television hotliner in Vancouver who had him on his show. After hearing his story he then said, "Well, what do you folks think? Do you think this ought to happen?" Then the lines were opened and the money came in to the tune of $26,000 so that he could finish his project.
The government is saying that private groups and charitable organizations should take up the slack and kick into the kitty so that research can be carried on. We have a heart fund, a fund for cystic fibrosis, and a fund for rheumatism. But as someone put it to me today, we do not have an organization for every organ of the body; you just cannot collect money this way. I am all in favour of having charitable donations to enable research to be carried on. Indeed, I think the cancer society ought to be commended for the work it is doing. But it cannot do all the work; surely the government has some responsibility in this area.
The government says that private agencies ought to help, and I agree. But in saying that, the government ought also to be consistent. I do not see the government saying that in terms of the economy. We do not see the government saying that private agencies ought to carry all the segments of the economy. No, Mr. Speaker, its arguments point the other way. The government wants to get involved and to mess around in the free enterprise system. I do not hear the government saying we should let more private enterprise become involved in Petro-Can or Syncrude; quite the opposite. If the government wants to encourage more private interest in medical research, at the same time it should also encourage private interest in the economy. All we are saying is that the government should be consistent.
The shameful aspect of all this, Mr. Speaker, is that even up to two years ago the United States was investing six times as much as Canada in medical research. What is the implication of this? It simply means that we face the awful prospect of riding piggyback on the good will of the Americans who are so often castigated by members of this government. So often members talk of the ugly Americans, but by George we sure want to ride them when it comes to taking advantage of their
Restraint of Government Expenditures medical research. We do not turn down their Salk vaccine; that is mighty welcome. I notice we do not mind importing their swine flu vaccine; that is also welcome. We let the Americans do all the research; we just take advantage of it.
Certain kinds of research have implications for industry. There are some pharmaceutical companies which carry on their own research because ultimately it has implications for their industry. After all, if their own researchers make a new discovery or develop a new medicine, the companies will produce that medicine and this will provide dividends.
There are other kinds of research that do not have these kinds of industrial implications. I have in mind medical research that will bring about new techniques in brain surgery, for example, or as has been the case in Canada where Canadians have contributed significantly to the development of better pacers and better techniques for implanting them and for implanting arteries in the heart. This is a significant contribution on the part of Canadian medical research, but that is not the kind of research that produces results for industry. This simply produces benefits for those who suffer from these diseases. There is no industry in the world that is going to contribute to that kind of research. On the contrary, it depends on the good will of the government to help in those areas where there are no industrial benefits, simply human benefits.
A series of cutbacks in medical research has one final implication I should like to point out, and that is in respect of medical training facilities. Hon. members of the House will acknowledge the fact that a good medical training staff in a university is totally dependent upon a good research facility in that university. We cannot simply have a professor of medicine in a medical school reciting like a tape recorder the information he has gleaned from textbooks year after year. A good medical instructor is one who is also active in the lab keeping current with medical research. He is involved in the world of ideas, asking questions, not simply repeating information. This is the kind of atmosphere in which good instructors and professors as well as doctors are produced.
One must ask what is going to happen to the quality of medicine in our country if we continue over the year with the kind of pattern the government is establishing at this time. What will be the quality of medicine in our country if our doctors have to go abroad to get up-to-date and adequate medical training? One might ask how many of the competent and world renowned research scientists, some who have received the Nobel peace prize, are no longer here in Canada because Canada was too niggardly and profligate in other areas to contribute in the field of medical research?
I suggest we will come to the day when we will curse ourselves for allowing the government to waste millions upon millions of dollars in areas that bear no fruit, while at the same time cutting back on grants that would provide us with a better standard of living and a more healthy Canadian population.

November 30, 1976
Restraint of Government Expenditures
These are the things I feel are shameful about the bill, obviously not the fact that we are going to save money. That is something in respect of which I pay tribute to the government. The fact is we must come back to that old question, "what are these among so many"? Millions of dollars could be saved, yet we are talking about petty cash or the amount the government spills in its negligence.
I trust the government will take another look at this matter, and it is for that reason I support the amendment that there be a six months hoist. Perhaps in this way we can shake up the government so that it will re-evaluate its priorities and realize it is ignoring the most important things in life.


Mr. Frank Hamilton (Swift Current-Maple Creek):: Mr. Speaker, it may be just coincidence that we are dealing with a bill to amend or repeal certain statutes to enable restraint of government expenditures at a time when newspapers from one end of this country to the other are carrying headlines to the effect that government spending is out of control.
It is common knowledge in this country that we have one standard for the government and another standard for the citizens. We see ministers abusing the trust placed in them, we hear talk about kickbacks and shady deals, and suggestions that the government is guilty of sins of omission or commission. I am reminded that there was a company by the name of Lockheed which was never really guilty of any offence, but a lot of people went to jail because of what that company did.
We are dealing here with another so-called omnibus bill. It deals with adult occupational training, the Company of Young Canadians, the Family Allowances Act, industrial research, Information Canada, the Western Grain Stabilization Act, and the Railway Act. It is difficult to find and deal with one principle in this collection.
Having regard to the Railway Act, the bill simply states that Section 272 of the Railway Act is repealed. We may not be dealing with a large amount of money, but in this short sentence we are dealing with a very large principle. In fact we are breaking an agreement that has lasted for 109 years. Surely if this is what we are intending to do it should be dealt with by a specific statute. If the government can get away with this then it is sure that it would be just as simple to change, amend, or destroy the Crowsnest Pass rates we have in western Canada under the Railway Act. To lump these railway proposals with the Company of Young Canadians takes some nerve and cynicism.
The term "at and east" has been used a great deal during the debate on Bill C-19, but I doubt if there are many hon. members who understand the background of this term. For years Canadian grain and flour were moved through the United States city of Buffalo east to tidewater for export. This naturally caused great concern to the Canadian grain trade and our maritime ports.
In 1960 the Canadian railroads were asked to set up rates that would be competitive with United States rail rates through Buffalo and east to tidewater. This meant that for all points from Georgian Bay on Lake Huron the railway rate was

to be competitive with the United States rail rate prevailing at Buffalo and east. The "at" refers to "at Buffalo." Canadian grain used to move from Buffalo through the Erie Canal out to export positions from there. The Canadian National Railways even had an elevator at Portland, Maine.
If the government can take away this protection under the Railway Act it could do the same thing in western Canada in respect of Crowsnest Pass rates. If it did the same thing the situation would probably be that western Canadian grain would move on U.S. rails to export and we would find ourselves in the same situation on the west coast of Canada as the Atlantic ports found themselves in before Section 272 of the Railway Act was effected. That is why we are taking such a stand on this particular section.
Bill C-19 has much to do with agriculture. At my meetings with various producer groups across this country several concerns have come through from all quarters. First there is the feeling that Canadian agriculture is being downgraded and traded off in international bargaining for industry. The second point is that the influence of the Minister of Agriculture (Mr. Whelan) has also been downgraded and he does not have the support of his Cabinet colleagues any longer.
The third great concern is that the government is not committed to supporting a viable Canadian agriculture and that food brokers will be allowed to pick up agricultural products anywhere in the world where they are cheapest. I can give as examples, cheese, tomatoes, mushrooms, beef, tender fruits and so on. If it is to be the decision of the government that the great retail stores are to feed Canadians, and if we follow this to its logical conclusion, then in Canada we will become a nation of agricultural consumers with no produce to sell and eventually no money to buy so-called cheap produce from overseas. We must make a decision concerning whether or not we want Loblaws, Safeway, and other chains to feed Canadians, or whether we want the Canadian farmers to do that job.
Then we have the matter of cheese imports into this country to the extent of 100 million pounds. Surely the Canadian Dairy Commission should be the first receiver rather than the brokers. We can produce 90 per cent of the specialty cheese in Canada. We have the importation of Taiwan tomatoes when Canada does not even recognize Taiwan. We have no trading agreements with that country.
Clause 15 of this bill, which would repeal the so-called "at and east" rates will directly effect the export of western grain and flour. This will be another heavy blow for those industries. Our exports are 20 million bushels less than they were last year at this time. At present our balance of payments is in a very grave situation.
The U.S. News and World Report of November 29 states that in Canada the forest industries are pricing themselves out of the market, that eastern Canada newsprint has almost doubled in price from $147 a ton in 1970 to $285 today, and will soon be $305 a ton. The share of Canadian newsprint in
November 30, 1976

the United States market was 80 per cent in 1950, 72 per cent in 1960, and 60 per cent in 1975. An executive of Canada's Abitibi Paper explains why United States mills moved in- lower transportation costs, lower wage costs, and lower wood costs.
Wages in Canada's forest industries in a decade have swung from 7 per cent under the U.S. level to 18 per cent to 20 per cent above it. Home grown wood delivered to United States mills is at least 40 per cent cheaper than the Canadian product.
At a time when we should be trying to increase our exports, this coming year, 1977, export grain will bring in $1 billion less in foreign exchange than in 1975 or 1976. Any stoppages and interferences in respect of the export of grain tend to make the Canadian dollar devaluate overnight. It is interesting that some six months ago the Canadian Wheat Board knew the government was going to scrap the "at and east" rates so it encouraged the grain industry to construct additional storage on the west coast of Canada at farmer's expense.
The way out of our present economic difficulties can be summed up in one word, productivity. In our country it used to be thought that work was the way to wealth. Now it seems popular to think that wealth is here and it just has to be redistributed. Most of the successes of our way of life have been due to the initiative, resourcefulness, and hard work of our individual citizens. Canada was not built on a 36-hour week with all the fringe benefits. For too long now we have concentrated far too much on how to spend our wealth and not nearly enough effort on how to create it. I see nothing in this bill that will increase productivity.
The legislation in clause 8 dealing with adult training lends itself to almost any interpretation. If this country is to grow and prosper and if productivity is to increase enough to catch up with inflation, our system has to offer incentives to the individual to participate and put forth his best effort.
As I said earlier, our great agricultural industry, which this bill directly affects, does not have confidence that the Government of Canada is prepared to support a viable agriculture. Producers hesitate to put investment into land and equipment that is necessary. They see the federal government cutting back basic research. They see the flood of imported agricultural food which makes them think, and rightly so, that the government is more concerned about the well being of foreign farmers than of our own.
Clause 14 deals with the Western Grain Stabilization Plan and defers federal government payments to the plan. We have one month to go in the present calendar year in which producers can opt out of the plan. Right now 39,000 western grain farmers have opted out, or 25 per cent. The government is trying to entice them in by extending the opting-in date another month until the end of December. We have over 25 per cent who have opted out now. All the landlords are automatically excluded as are all sales over $25,000. So I doubt that half of the western grain industry will be covered by this plan. Surely better use can be found for the tax dollars than such an expensive stabilization scheme which will cost the
Restraint of Government Expenditures taxpayers of Canada something in the order of $100 million a
year.
Rules and regulations flow from government departments almost extemporaneously, without proper thought. The increasing number of reports and forms required by government puts a great deal of hardship on small business and on individuals because, unlike large organizations, they cannot afford to hire a staff of experts to cope with such harassment. Over-regulation is slowing our productivity at a time when increased productivity across our nation is the best antidote for inflation.
I can give as an example Canadian Wheat Board "Instruction to the Trade" which starts out, "Notwithstanding anything in the Canadian Grain Act," and goes on to suspend storage ticket rights of grain producers who wish to deliver to the domestic off-board feed grain market. I think the Board overstepped their authority in this case, and I intend to raise the matter in the House.
A report of the School of Business Administration at the University of Western Ontario, London, states that estimates by six large industrial firms of the cost of complying with the controls program ranged from $200,000 to $1 million per company, with thousands of firms covered by AIB controls. It is easy to see with respect to firms covered by AIB controls what the incredible cost of the program is to the Canadian economy.
Our high minimum wages have priced many students, the unskilled and older workers out of the market, and their potential is lost. What the government should be doing, Mr. Speaker, is to abolish the capital gains tax for family agricultural enterprises, and for small businesses after they have been in business for ten years, by ten per cent a year. This tax generates something less than one third of one per cent. These small businesses contribute flexibility to the economy. They work long hours and they get the work done when necessary. Canadian farmers with the help of their families have established a record of productivity per person that is hard to beat, and they do not draw unemployment pay when times are slack.
Our Minister of Agriculture is certainly consistent. He keeps bulling ahead with his supply management theories. I am looking at a report in the Vancouver Province headlined, "Whelan Wants to Oversee All Food Output". The article states:
The scope of the federal department of agriculture will be increased and strengthened before the spring budget, Agriculture Minister Eugene Whelan said Monday.
He implied that he wants a cabinet position that would give him responsibility for all food production, but said: "We have been working on a program and how would you say, probably it won't go as far as 1 want it to go."
He said his department is probalbly "the most disseminated of any department of agriculture that 1 have visited." Whelan has complained several times in the past two years that he is not responsible for all facets of agriculture.
Whelan said he wants control over all grain production-the Canadian Wheat Board is now under Transport Minister Otto Lang-and would favour the inclusion of several other agriculture programs now overseen by the department
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November 30, 1976
Restraint of Government Expenditures
of industry, trade and commerce and the department of regional economic expansion.
Whelan said that if he gets responsibility for grain production, he would put Vancouver's five grain terminals under one management authority.
He said Vancouver's grain handling problems stem from a combination of different policies by the elevator firms, and union-management squabbles.
I think western producers would want to take a long, hard look at that proposition. EIow can the minister run supply management operations when he cannot control what is coming in from overseas? The export-import laws he operates under require that producers suffer before any action is taken.
Only the federal government is responsible for international trade regulations. Support prices for any commodity cannot be divorced from international trade. Certainly no provincial government has power to set quotas or tariffs on foreign food imports, so it is only natural that producers look to Ottawa to keep their provincial programs from being eroded or erased by a flood of cheap imports. The current international controversy over offshore beef imports is a prime example and a very painful one for our beef producers. Once again I refer to the Vancouver Province of November 9, 1976. Under the headline "Marketing Boards Only Way to Protect Growers-Whelan" part of the article reads as follows:
Whelan talked to more than 130 leaders of Canada's $700 million-a-year horticultural industry for more than two hours, but his audience didn't like what it heard.
The delegates at the two-day meeting on national marketing schemes wanted a definitive statement from Whelan that Ottawa would maintain a fruit and vegetable industry and abandon a cheap, consumer-oriented food policy which relies on increasing imports from the U.S.
"We came here expecting some answers and all we got was a glowing report about different federal programs," said Nigel Taylor, a Kelowna-area orchardist and president of the Canadian Horticultural Council.
"He said nothing about our real problems and the answers we want from government," said Taylor.
Said a senior member of Whelan's department: "It was embarrassing. Whelan had to know they wanted assurances but he ducked the issue."
As I said before, the repeal of the so-called "at and east" rates will adversely affect Canada's share of world wheat exports and certainly our share of flour exports. It will probably be great for St. Lawrence ports, but it will be murder for the Maritime ports. With regard to the commission dealing with the cost of moving grain by rail, the Minister of Transport has a copy of the Snavely report, but we do not have access to it. There is no surer way to undercut a commission than to go about it as the Minister of Transport did in western Canada when he tampered with the rates on rapeseed products and as he is doing now in removing this section from the Railway Act.
We are presently facing a situation where Canada's share of world wheat exports is shrinking steadily, and there is little evidence to support an early reversal of the trend. In the ten years from 1965 to 1975 Canadian wheat exports as a percentage of total world wheat exports dropped to 14 per cent from 24 per cent. In contrast, the United States increased its share of world wheat exports to 41 per cent from 38 per cent. The situation in our flour exports was even worse. At a time when

we should be doing everything to increase exports, this bill would adversely affect grain and flour exports.
We can well ask, if farmers are expected to pay the full cost of transportation as users, why should the same rule not apply to consumers in Canada? During the past two years Canadian consumers have been subsidized for bread and pasta products to the tune of $280 million. Farmers were required to put up $64 million of that amount. The federal government turned over $216 million to the Canadian Wheat Board as partial compensation for wheat sold to Canadian millers at a floor price set by the federal government. The $64 million difference was a deduction from producers' income.
We have just seen an extraordinary marketing deal arranged by the Canadian Wheat Board. Some four million tons of wheat were turned over to the international traders. The Wheat Board, not having overseas customers for this grain, took the international trading route. Farmers are expected to pay the interest on the money which has to be used to buy the grain, and they are expected to pay for the storage. This grain can be picked up any time until next August. The carrying charges would be some 35 cents per bushel. I suspect that the Wheat Board was pressured into this extraordinary move because it cannot sell below the guaranteed initial price, which is $3. The price now at Thunder Bay is $3.25, so they are right on the line. Surely this is a most speculative deal, and one of the main reasons for setting up the Wheat Board was to stay away from these speculative operations.
We should be talking about the lack of moisture reserves across the western prairies and across the grain growing areas of the United States. It seems to me that at this stage the Government of Canada announced to the world that, given even normal precipitation next year, Canada will be hard pressed to produce an average crop. Therefore we should consider taking 100 million bushels out of our stocks and holding it, just in case, for next year. It seems to me we have too many high sounding words from the government and too few actions to correspond with them.
I commend the report of the Auditor General to this government. I suggest it fits into this bill very well. For that reason and others I am pleased to support the amendment of my colleague, the hon. member for Lambton-Kent (Mr. Holmes), which is that Bill C-19 be given a six months hoist.
I hope the government will also take into account the falling value of the Canadian dollar, which will certainly undo the work of the Anti-Inflation Board.
The Auditor General has asked that a comptroller general, a chief financial officer, be appointed to ride herd on departmental expenditures. I urge the government to appoint such an officer before asking us to pass Bill C-19.


Mr. J. Robert Howie (York-Sunbury):: Mr. Speaker, at this important time in Canada's history the credibility of the government is of paramount importance to every Canadian and every member of this House. It is important to give Canadians the confidence that the restraint we ask of others is practised by ourselves, confidence that all are treated fairly,
November 30, 1976

and confidence that all Canadians get full value for their tax dollar.
When the Auditor General tells us of millions of dollars paid to agents to arrange the sale of nuclear power plants to Argentina and South Korea-two countries which, in my opinion, should not have potential nuclear capability under any circumstances-the restraint practised by the government compared with that asked of the Canadian people appears as a farce.
I am going to criticize specifically clause 15 of this bill as it affects the Maritimes, and suggest an alternative approach to the government. As an alternative 1 think the time has come to examine the large, sprawling empire of government departments and agencies to determine whether the existing structure is the most efficient vehicle for serving the Canadian people, and to identify the changes required to perfect the system. I suggest we should start at square one and ask ourselves what role government should play in our society and whether we have exceeded that function, perhaps to the detriment of higher priorities.
While I have the greatest respect for every committee of this House which deals with the estimates of government, I believe the time has come to take a giant step forward in examining the total impact of government expenditures, and new systems and methods which can streamline our operation and lighten the burden on Canadian taxpayers. As a corollary to this, I believe we should examine the impact of government spending on the Canadian economy and its relationship to the inflationary spiral.
Since the Royal Commission on Government Organization, commonly called the Glassco Commission, reported in 1962, the $6'/2 billion expenditure of that year has more than tripled in the interval as shown in the main estimates before us today. In the 14 years since the Glassco Commission reported, some outstanding social legislation has been enacted, and federal government assistance to disabled and disadvantaged Canadians has improved immeasurably, both in its quality and amount. Indeed in respect of disabled people, particularly the blind, and in respect of our senior citizens I find it easy to support the proposals of my colleagues in this House for even more generous treatment. At the same time I believe we can make some real progress in identifying areas within each department of government which can and should provide a service for other departments of government, and avoid costly duplication, the tremendous expense of hiring outside professional and other services, and consulting with experts outside departments of government.
The total budgeted cost of outside consultants in all departments disclosed in the estimates is more than the total expenditures of any of the maritime provinces. I believe also that the total structure of our government has become so complex and so unwieldy that the lines of authority from the minister to those in the lower echelons are strained to the utmost.
Restraint of Government Expenditures
The ability of all departments of government to focus on any one problem in our economy, like that of regional disparity, leaves much to be desired. For example, the Department of Regional Economic Expansion has expended millions of dollars in Atlantic Canada with some degree of success in building the economy of that area. As DREE takes one step forward in establishing new industries, the lack of a cohesive and progressive transportation policy erodes its effect. Clause 15 of the bill before us, repealing section 272 of the Railway Act and sentencing hundreds of maritimers to the unemployment lines, is a case in point. This case was well documented earlier in this debate by my colleagues, the hon. member for Carleton-Charlotte (Mr. McCain) and the hon. member for Fundy-Royal (Mr. Fairweather). It is not my intention to repeat their remarks.
The total amount spent by DREE on incentive grants since its inception is considerably less than the amount projected for the Mirabel airport alone. The Auditor General's report should not be a once a year embarrassment to government. The function of this office should be a continuing service of remedial action.
In department after department of government, estimates of expenditures climb. It is imperative that every one of these expenditures receive the closest possible scrutiny, but the time allocated to our House committees to perform this function and the research facilities needed to dig into them are not sufficient to do the best possible job for the Canadian people. I feel that with the tremendous increase in the complexity of government organization since the Glassco Commission of 14 years ago, we need to examine our administrative process in the light of the vast improvements and changes that have taken place in business, accounting, policy auditing and computerization, thus ensuring that the total delivery system of government best serves the challenge the Canadian people have given us.
We know that at this time there is much evidence that the government proceeds like a whole series of separate empires. These empires often compete with each other. Sometimes they even conflict with each other. The user-pay concept for transportation suggested by clause 15 is in conflict with the use of transportation as a development tool envisaged by DREE. What a discouragement this must be for the minister of DREE! I hope he will not support this clause.
These are all reasons why it is timely to consider a new look through a new appropriately guided royal commission. What are some of the things at which we could look? I suggest the following: first, we could look at the cost of particular operations in relation to the cost of similar functions in the private sector.
Second, we could look at new approaches to accountability. The Glassco Commission tried to establish some in both the financial and personnel management fields, but the ways in which these have been adopted certainly are not working perfectly, and the demands are greater today. The Auditor General has made excellent recommendations.
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November 30, 1976
Restraint of Government Expenditures
Third, we should look at some important aspects of personnel function. There is a good deal of evidence that labour relations in the public service are bad.
Fourth, we need to identify obsolete and outdated functions. Unless we look at something like the government every so often, things go on forever even if the need for them disappears.
Fifth, we need to identify functions which could be done as well or better in the private sector. The Glassco Commission tried to identify some of these, but not very much action resulted. It is worth another try.
Sixth, we need to look at the whole organization from the standpoint of the function it is supposed to perform and its performance in fact.
With so much change in growth in the public service, and so much change in the role of government and the character of the world around the government-the external environment-there are bound to be inadequacies and things which deserve another look so that we can feel our taxes are well spent.
If the government wants to restore credibility, to restore confidence, to really do something about restraint, regional disparities and national unity, then it should review its performance in the administration of our national affairs.
The restraint provisions in the bill before us affect every poor Canadian, and the poorest regions of Canada are hit the hardest. At the same time in another bill the banks are given extended powers to make more money through interest rates charged to Canadians who have to borrow to make ends meet. This makes the 1970's the most expensive decade in our history. The rich get richer and the poor get poorer, and the government's restraint program bites hardest in the maritimes where regional inequities are frozen in place by the operation of the Anti-Inflation Board.


Some hon. Members:: Hear, hear!


Mr. Ken Hurlburt (Lethbridge):: Mr. Speaker, I am happy to participate in the debate on Bill C-19, an act to amend or repeal certain statutes to enable restraint of government expenditures.
In the recent Speech from the Throne national unity was given top billing. The whole section on national unity, however, had to do only with the promotion of better understanding between French-speaking and English-speaking Canadians, and the official languages policy. I will not go into the subject of bilingualism or the Official Languages Act except to say that the policy of bilingualism will only work if it is perceived to be an equitable policy by all Canadians. To achieve national unity requires more than resolving the question of bilingualism. There is a feeling of alienation building up in western Canada. Westerners are concerned about the disparity in freight rates. They are concerned about Canada's energy policy.
I think it is important to understand that for many years people on the prairies were dependent primarily on agriculture.

The finding of oil and gas in Alberta, and later in Saskatchewan and Manitoba, gave rise to hopes of limited industrialization to complement our agricultural economy, which is full of uncertainties at the best of times. Finishing of beef and processing of our agricultural products at home on a large scale have not been possible because of our freight rate structure, and neither has the development of a viable agricultural implement industry. For example, it is cheaper, or just as cheap, to ship a carload of steel from Hamilton to Vancouver, as it is from Hamilton to Regina. Yet Regina is 1,200 miles closer to Hamilton.
I would like to quote from Kenneth McDonald's article which appeared in the October issue of Executive magazine:
The freight rates that penalize the west to stimulate eastern Canada's manufacturers are unchanged long after their purpose was served. The national oil policy which secured the Ontario market for western oil failed to secure the Quebec market, which would have made the whole country self-sufficient-for the specious reason that Quebec refused to yield the 1 per cent gallon advantage it derived from imported oil.
The federal politicians whose tax policies halted the western mineral exploration which would benefit all Canadians were careful not to interfere with the James Bay development which will benefit only Quebecers, and at a cost already surpassing $16 billion, when the development of Alberta's tar sands is dismissed as too costly at one fifth of that figure. In the meantime Hydro Quebec exports power to New York, tax free, at a rate of profit undreamed of by the beleagured oil companies. The provinces whose stewardship produces Quebec's annual subsidies see the money squandered on projects ranging from a superfluous airport to palatial government buildings to an Olympic site surrounded by raw sewage.
Oil and gas in the west are a non-renewable resource and will be used up by the end of this century-another 25 years. When this resource is gone, if we do not have another industrial base we could end up as have-not provinces. This is one reason why the Premier of Alberta has indicated concern about an amending formula to the British North America Act. He is concerned that changes could result in the erosion of a province's right to control its resources. I mention these problems, Mr. Speaker, first to indicate that there are problems other than bilingualism affecting national unity and, second, to give you a better understanding of some of the problems in the west.
Inflation is weakening us. The Liberal voices in government today are blaming businessmen, unions, and even the buying public, for not practising thrift and economy in their shopping habits, while they, the government, go on spending money as if it were going out of style. As the previous secretary of agriculture of the United States, Ezra Taft Benson, pointed out two or three months ago to a gathering at Cardston, Alberta and I quote:
The blame for inflation must be laid directly at the door of the federal government itself. Inflation is an increase in the nation's money supply ... an increase in the supply of money and credit.
He went on to say:
Inflation is not caused by rising prices and wages. To the contrary, rising prices and wages, as any solid economist knows, are the direct result of inflation.
It stands to reason that when the money supply is increased, all money automatically becomes less valuable. This includes our savings.
November 30, 1976

When our dollars shrink in value, businessmen naturally raise their price tags. Then their employees demand higher wages.
In a free society such as ours, only the federal government can cause inflation. And the reason it puts more money into circulation is to finance its disastrous policies of deficit spending.
As the federal government promotes more and more costly and unnecessary programs, it spends far more than it receives. So to keep in business, the government has to borrow . . . Thus, new money is created. The money supply is increased ... and ... the value of all money is reduced.
It is well to remember that continued government deficits cause inflation. Inflation is used as an excuse for ineffective price controls. Price controls lead to shortages. Artificial shortages inevitably are used as an excuse to implement rationing. When will we learn these basic economic principles?
I think we would do well to heed those remarks made in Cardston two or three months ago. I continue quoting. He suggests that Canadians could halt inflation today by-
-demanding that their government stop increasing the supply of money. It is not that the government does not know how to do it... It doesn't want to do it. Their excuse is if they stop printing money, they will plunge the nation into a recession ... or worse ... a depression precipitating an unacceptable percentage of unemployment. But the longer we delay sound action, the more it will cost our nation and its people.
My impression, Mr. Speaker, prior to coming to Ottawa as a member of parliament, was that members from all regions of Canada would meet and express their ideas in committee and would then decide on not only what is best for their constituents but what is best for the majority of Canadians. Believe me, I found out in a hurry that consensus of opinion does not prevail when we have a Minister of Agriculture (Mr. Whelan) who is committed to an over-all program of supply management as well as conducting an all-out effort to have all agricultural commodities come under the jurisdiction of federally controlled marketing boards.
I must admit I was optimistic when the present Minister of Agriculture was appointed to the agricultural portfolio. I thought to myself, at least here is a man who is agriculture-oriented. Lo and behold my assumption was not correct. The agriculture minister actually spends very little time farming. Most of his time has been spent setting up marketing boards. It is not surprising, is it, that he is not attuned to the problems facing the producer? Not only is the minister oblivious to the problems facing the producer, he must also implement government policy, which partly explains why the programs are in such a shambles. This is precisely the situation we encountered with the previous minister of agriculture, the Hon. Bud Olson of Medicine Hat. We thank the good Lord that we had such strong representation from western Canada in the House to fight so vigorously against Bill C-176. May 1 call it ten o'clock, Mr. Speaker?


BUSINESS OF THE HOUSE
Walter David Baker: Mr. Speaker, I rise on a point of order. I understand that the government intends not to proceed with the debate on Bill C-19 on Thursday of this week. I wonder if anyone on the government side can confirm that the business of the House on Thursday will not be Bill
Adjournment Debate
C-19 but will be Bill C-22, or perhaps some other bill which the government has in mind. I wonder if that could be confirmed.


Mr. Guay (St. Boniface):: Mr. Speaker, to the best of my knowledge we will carry on with Bill C-19 on Thursday. Tomorrow is to be an opposition day, and Friday also is to be an opposition day.


Walter David Baker: I thank the chief government whip for that information. Can he confirm what he said or if he should be wrong will he correct his statement tomorrow and let me know?


Joseph-Phillippe Guay: Mr. Speaker, I am not in a position to confirm, but I will advise the hon. member accordingly.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. John A. Fraser (Vancouver South):: Mr. Speaker, it is a pleasure to rise again in the adjournment debate to discuss a matter which has been discussed extensively in this House. I refer to the so-called third or new runway at Vancouver International Airport.


Walter David Baker: Is it needed for Otto Lang's aircraft?


John Allen Fraser: This runway was not necessary previously. Actually many people wonder why the Ministry of Transport decided to build a new runway. The reason was a secret very well kept by members on the government side and members of the department. Recent news stories which show how often the Minister of Transport (Mr. Lang) used a government aircraft to reinforce the position of his own party in western Canada indicate that the minister obviously needed a special runway for that aircraft. As a consequence, now the secret is out. We know why the Minister of Transport is going ahead with the runway. But there are some conflicting statements which have been made by the Minister of Transport, and I am not referring to other conflicting statements he made but rather to the conflicting statements he made in connection with this proposed runway.

November 30, 1976
Adjournment Debate
On October 25, as reported in Hansard at page 402, I asked the minister at what stage were the plans for the so-called new runway or third runway at Vancouver International Airport. The minister replied that certain environmental studies were seen to be necessary before any final decision was taken. He went on to say:
In the meantime, a certain amount of regular fill that is available without impact upon the waters nearby is being obtained and arranged for pre-loading in the runway area.
I put to the House that that is a clear indication that a certain amount of material, to use the minister's word "fill", was being obtained which would and could be used ultimately for construction of the runway if the decision were made to go ahead with it.
Some weeks later we discovered that a tender had been offered through the Vancouver papers on November 5 to dredge sand from the north arm of the Fraser river. I asked the Minister of Transport on November 18, as reported in Hansard at page 1,129, whether this sand was going to be used for the runway construction of which apparently, according to the Minister of the Environment (Mr. LeBlanc), had not been decided as yet. The minister said:
Mr. Speaker, it is sand which might be useful for that purpose if a decision to build that runway goes ahead. There is a time interval between the time the sand can be obtained and the time the necessary dredging takes place and we are therefore acquiring the sand.
Later he went on to say:
... I am told that the dredging going on and which is contemplated is required in any case. We are saving the sand in case we need it. It may be that the hon. member would be able to ask me what we will do with the sand if we do not need it for that purpose.
I submit that "that purpose" which the minister referred to was the runway. I suggested that if the construction of the runway was not decided upon, perhaps the minister could put the sand back in the river, but he did not seem to see the humour of that. However, the minister, having twice said that this sand could or would be used for the runway if it was to go ahead, is in the awkward position now of being contradicted by his officials in the city of Vancouver. I should like to quote from the Vancouver Sun of November 19 as follows:
H. A. Stevenson, regional manager of the Canadian Air Transport Administration, said Thursday that the 700,000 cubic yards to be dredged will be used for general purposes only.
He went on to say:
The area is not being dredged for a runway. We are replenishing our stock piles for general construction purposes.
The question is direct and simple, and it is time it was answered without any equivocation. The minister has said twice now that this sand would be used for a new runway, but his own officials in Vancouver have completely and utterly denied that. I want to know tonight whether the parliamentary secretary would please advise us exactly what the situation is and why his minister on two occasions would make a statement in the House which was completely contradicted by one of his own officials in Vancouver.


Mr. Marcel Roy (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, with the hon. member's permission, I will start off with a sentence in French. Am I the grain of sand which allows the train to climb up the Rocky Mountains? I think that is exactly the role performed by the Hon. Otto Lang in the Department of Transport.

I might mention that every time the minister used the airport it was to ascertain exactly what the problems were and to discuss them with the people there.
In reply to the hon. member for Vancouver South (Mr. Fraser) with regard to the possibility that the sand dredged from the Fraser River is contemplated for use on a new or third runway at Vancouver International Airport, I would like to say that it was on March 11, 1976, that we received program approval from Treasury Board for the acquisition of sand to be used for further construction purposes at Vancouver International Airport; and also approval in principle on the calling of tenders.
As the minister said before in reply to a question the hon. member raised in the House at that time, this sand might be useful for that purpose if a decision to build that runway goes ahead.
I would also like to add, Mr. Speaker, that for the past several years this sand has been obtained, under arrangement with relevant federal and local authorities, by dredging from the adjacent Fraser River. This is the most economical means of supply. As the supply is limited, it must be reserved and, in the past, has largely been made available on the basis of dredging programs to provide the material and to ensure the navigability of river channels.
Tenders for the dredging work closed November 25 and the three tenders received are to be reviewed December 10 by an interdepartmental committee as requested by Treasury Board.


CAPE BRETON DEVELOPMENT CORPORATION-PAYMENTS DUE PRE-RETIRED MINERS-GOVERNMENT ACTION
Mr. Andy Hogan (Cape Breton-East Richmond):: Mr. Speaker, the pre-retirement leave plan, PRL, was put into effect by the Cape Breton Development Corporation following the federal government's take-over of the coal mines in Cape Breton in 1968. The thought then was that Cape Breton coal was on its way out as the private owners decided to pull out. The escalated price of oil after the formation of the OPEC oil monopoly has, of course, changed all that.
One humane, if inadequate, way of meeting the problems presented in the mid-1960's, was to pre-retire voluntarily the miners at the age of 55. Some 78 per cent accepted the offer. There was also a compulsory retirement feature for those 60 years of age. The pre-retirement benefits were to be $250 a month for married men and $200 for single men.
A major difficulty arose because ordinarily a man agreeing to the PRL plan could expect the PRL benefit plus one year of

November 30, 1976

unemployment insurance claims. The men pre-retired between 1969 and 1971, numbering some 1,500, received their unemployment insurance benefits not as a separate sum to which they were entitled but as part of their total PRL benefit. Mr. Maclnnis, who was then the member for Cape Breton-East Richmond, claimed that this was illegal and that the men were legally entitled to full PRL benefit plus UIC benefit.
When Mr. Kent became head of Devco in 1971, he separated the UIC benefit from the PRL benefit so that those who were pre-retired after 1971 received the total PRL benefit plus unemployment insurance. A group of miners representing men pre-retired between 1969 and 1971 formed a committee under the leadership of Mr. Maclnnis, which became known as the working committee for this group. This committee has, in the past, appeared before the Standing Committee on Regional Economic Expansion to present its case. Mr. Maclnnis and the hon. member for Cape Breton-The Sydneys (Mr. Muir) fought their case long and hard, both in the House and in the standing committee. The Justice and Legal Affairs Committee has also studied the matter and concluded there should be a voluntary agreement between Devco and these PRL men, or else the case should be decided by the courts. The committee decided to take the Cape Breton Development Corporation to the Supreme Court of Nova Scotia-and lost the legal case. To be fair to Devco, the company offered arbitration to the men prior to the court case.
In this parliament, the hon. member for Cape Breton-The Sydneys and I have been arguing that if these men have no legal right to payment, as the Supreme Court of Nova Scotia decided, then they are morally entitled to an ex gratia payment, bonus, stipend, or whatever you wish to call it, especially in view of the increased benefits which have been granted to the PRL group by Devco since then. For example, since May 1, 1976, the PRL group through a tie-in with the Consumer Price Index are receiving the following payments: married men with a dependant, $398.51 monthly, and single men, $328.82 monthly. The hon. member for Cape Breton-The Sydneys and 1 have been arguing that these men are entitled to a minimum of $500 for the loss of their UIC benefit-I am speaking of the men pre-retired between 1969 and 1971. This comes to a total of some $900,000.
In the past few years we had numerous meetings with the Secretary of State for External Affairs (Mr. Jamieson) and Mr. Kent. Mr. Kent has appeared in all the mining towns and addressed the PRL men who belong to the pensioners union. They have agreed in writing that the hon. member for Cape Breton-The Sydneys (Mr. Muir) and myself would be left to come to a compromise with the minister in charge of DREE and the head of the Cape Breton Development Corporation, Mr. Kent, on this issue. Mr. Kent, at a meeting with the men, accepted the moral obligation argument of these miners, as did the former minister of DREE. I was under the impression that the present minister also held this view.
Adjournment Debate
When Mr. Kent appeared before the committee last May 13, 1976, I questioned him and I quote from the record:
Mr. Kent, I just want to be clear about this and have it on the record. It seems to me that in the statement you have made today about the issue of the men who were pre-retired between 1969 and 1971, that you have committed the corporation to meeting the moral obligation in the form of some ex gratia payment to a larger extent than you ever did publicly before. You may disagree with me but when you appeared before the pensioned miners in Glace Bay, the pre-retirement people, and in New Waterford, after having explained the increases that they had gotten in the PRL and how you had set a basis of a decent non-contributory pension scheme that would be added, you said there were some options, such as increasing the widows' allowances, increasing the numbers of years of people who had worked in the pit and so on, as well as the option of giving some kind of payment to these men who were pre-retired between 1969 and 1971.
Do I understand from what you are saying today that these options, based upon the knowledge that has at least come from the groups in my constituency, Glace Bay and New Waterford, represent the highest priority for you in terms of helping the pre-retired people?
Mr. Kent replied as follows:
Yes, 1 think that is fair. In order that there be no danger of misunderstanding, perhaps you would allow me to restate it carefully.
What I did last fall was to describe the program as we had planned it, discussed it, and were carrying it out, with the major next step then due this July 1. I pointed out how expensive that was going to be, what had been done, what was in process of being done and, therefore, I could not say when we would be able to make any further improvements. But I committed myself very clearly to the view that further improvements are desirable when we can make them. At that time I listed the kinds of improvements that were possible and I said that as far as I was concerned I would be very much influenced by the response from the people affected as to what they felt were the priorities among those possible improvements. What I am doing today is saying that although there were some actually formal votes by some of the pensioners' clubs on the matter. .. Certainly the response that has come back, quite apart from formal votes, really has been a reaffirmation that, quite apart from this legal argument which has been such a difficult one and I think an unfortunate one for everybody, in terms of a sense of moral claim, this issue is the one which is given the highest priority by the people concerned as a whole, whether or not they are personally affected.
I recognize that and I have said that in the light of that, then certainly we would agree in giving it the highest priority among the possible improvements that we certainly hope to make as soon as possible.
On November 17, 1976, in the House of Commons, in reply to a question of mine concerning the PRL miners, the Minister of Regional Economic Expansion (Mr. Lessard) replied as follows:
I am well aware of the situation of Cape Breton miners who had an early retirement around 1967, and I also know about the regulations which were made at that time. The hon. member also knows that the situation of those retired people has been highly improved since then, but under the circumstances my representations to the President of the Treasury Board are rather to obtain additional funds for Devco so that conditions in the mines keep on improving for the workers. Unfortunately, I am not now in a position to answer positively to the hon. member's representations. I do hope that eventually we can perhaps do so, but unfortunately the circumstances are not appropriate now.
This is, Mr. Speaker, to say the least, a highly unsatisfactory answer. One gets the impression that the minister is hoping that the lingering moral obligation will just go off into thin air. I would hate to think that the minister and the Treasury Board are punishing these people for having made a well-intentioned but tactical mistake in the past in bringing the corporation before the court.


Mr. Deputy Speaker:: Order, please. I regret that the time allotted to the hon. member has now expired.

November 30, 1976
Adjournment Debate


Mr.   Ed. Lumley@Parliamentary Secretary to Minister of Regional Economic Expansion: Mr. Speaker, in acknowledging the sincere representations of the hon. member for Cape Breton-East Richmond (Mr. Hogan), as well as other colleagues on both sides of the House, I should like to assure the House that the department truly understands the viewpoint of the Cape Breton miners who went on early retirement in the period 1969 to 1971. I must, however, point out that in recent years there has been a very great improvement in the benefits paid to these men and to other retired employees of the Cape Breton Development Corporation. When the pre-retirement plan was started in 1969 the benefit was $250 a month. Now it is $398.50 per month.
That, however, is only a minor part of the improvement in the position of these men. At the time they were pre-retired they had nothing to look forward to in the way of a company pension plan when they reached the normal retirement age of 65. The small pension plan that there had been was being phased out as pensions under the Canada Pension Plan came into operation. This has been completely changed.
All Devco employees now receive from age 65 a non-contributory pension which, after they have had 25 years in the industry, is $133.50 a month. This pension plan is applicable in full to all those already retired as well as to those who retire in the future. More of the men who were pre-retired in the 1969-71 period are now beneficiaries of the improvement in the age 65 pension, and the others will become so. I may add that widows get the pension in the full amount.
The grievance raised by the hon. member is that when the PRL plan began it was a supplement to unemployment insurance and not a separate benefit. The result was that the men affected in 1969-71 received net payments of an average of about $500 less than they would have if the PRL amount had been paid irrespective of a man's entitlement to UIC benefits.
We all recognize the importance of $500 to these men, but I must point out that the improvement in pension benefits has already meant a great deal more in dollars than the one-time $500. That is true for all the men affected. The pension benefits, of course, also apply to people who retired early and who would otherwise in many cases have less to live on than the men affected by PRL. That is why Devco gave priority to the universal improvement in its pensions. The improvements are currently costing the corporation about $6 million a year.
Nevertheless, the corporation has made it plain that when it generates more revenue and can operate in the black it will be prepared to make further improvements and, if it is the wish of the pensioners themselves, to include in that a special recognition of the situation of the men who went on PRL in 1969-71.
However, the corporation is not yet operating in the black. It requires treasury assistance for its operations, wages, and the present level of pensions. Therefore what the hon. member is asking is a special payment from the taxpayers of a kind that I am sure we would all like for many hard-pressed people but for which it is not easy to establish a special case in times of great financial stringency.


URBAN AFFAIRS-SACKVILLE, NOVA SCOTIA-ALLEGED CHANGE IN DEVELOPMENT PLAN BY NOVA SCOTIA HOUSING COMMISSION
Mr. Robert McCleave (Halifax-East Hants):: Mr. Speaker, some 19 years ago when I came to parliament as a rooky the concept of planning on a very large scale for municipal development was but a very small concept in the minds of those who sat in this Chamber. Since that time this rooky member has become one with 17 years' experience, with planning entering more and more into our lives, particularly government planning at the municipal level.
When I talk tonight about a municipal plan it is a plan that could only have got off the ground with the federal government providing money in the millions through CMHC. This it has done. The provincial government has provided money through the Nova Scotia Housing Commission.
Some 17 years ago when I first campaigned in the district of Sackville there were a few thousand people leaving there. Today there are more than 35,000, and this has in fact become the second or the third largest community in the province of Nova Scotia.
What brings me here this evening is the fact that I feel that when the government gets into planning surely the government has an obligation to be honest in that planning with the people. I have no fault with CMHC or its honesty and intentions. I think the answer the parliamentary secretary will give me when he replies to my complaint will be as good as the answer I received the other day from the Minister of State for Urban Affairs (Mr. Ouellet). We are all on the same wave length, but I regret to suggest that the provincial body I refer to tonight is not on that same wave length. The Nova Scotia Housing Commission has shown a deplorable lack of good faith in respect of the people of the Quaker Street area of lower Sackville.
I have here a plan that is not exactly small by anyone's standards; it must be about four feet by six feet, perhaps. It is signed by the Nova Scotia Housing Commission and is given to each person who buys a particular lot in the area I am talking about. This plan shows that the land is proposed to be divided into churches, schools, parkland, and commercial areas. In short it is a modern plan. I believe the people who put this plan together did a very fine job.
You and I, Mr. Speaker, being fathers, if we moved into a new community perhaps would look first of all for the amenities which would allow our children to attend school and our -wives to shop, and our families to go to church on a Sunday morning or enjoy the other amenities such as parks. This is all set forth on the plan provided to each of the homeowners in the Quaker Crescent area. What happened was that this has all been subverted. A substantial amount of what was supposed to be used for church, school and institutional purposes has been subverted to a proposed shopping centre.
I make the argument this evening that Central Mortgage and Housing Corporation, in good faith, put in millions of
November 30, 1976

dollars of the money of our Canadian taxpayers into the building of homes in this area. This was money of the taxpayers in Canada from Buena Vista to Vancouver Island. Then somebody, the Nova Scotia Housing Commission, but more particularly-I will place the blame right where it goes-Mr. Regan, the Premier of Nova Scotia, and the provincial Minister of Housing, Mr. Fitzgerald, allowed that noble purpose to be prostituted by changing what in effect were guarantees in this plan. This is the way it happened.
When I raised the issue initially it made a small headline in the Mail-Star of Thursday, November 25, 1976. If we look down on page two we will find that somebody from the Nova Scotia Housing Commission, Mr. Austin-not Mr. Fitzgerald, the Minister of Housing who is only good when he is tackling federal members of parliament and not expecting them to reply back; he certainly stayed out of this fight, but he will be in it before I am through with him-the executive director of the Nova Scotia Housing Commission had this to say:
It was commission policy, Mr. Austin said, to give people purchasing lots some idea of what might be developed down the street from them-but the plans were not definitive, they were only conceptual.
It is called a legend here, Mr. Speaker. Perhaps that is what he means by it being conceptual, but in any event it certainly is as specific as anything I have ever seen. The article continues:
When Sackville Town Development Company Ltd. approached the commission with a proposal to develop the site commercially, he said, the commission was delighted, and an option was signed.
Did you ever hear anything as corrupt in all your life, Mr. Speaker? The Nova Scotia Housing Commission, a body set up by the provincial government of Nova Scotia, set forth a plan for development of a city of 30,000 or 40,000 people, and then somebody comes along and suggests that maybe instead of having a park and a school and some nice fine residential streets we could turn this into a shopping centre, and the Nova Scotia Housing Commission says "hip-hip-hooray" and tears up its guarantee to the people in that area.
I will speak until my time runs out, Mr. Speaker, so do not be afraid to set me down on the time element. I will come back on this again, and again and again. The Nova Scotia Housing Minister, Mr. Fitzgerald, is corrupt for having allowed this deal to take place, and the premier of the province is corrupt for having allowed it to take place. I hope the warden of Halifax County and the council will refuse to countenance an absolute and gross breach of faith with the people by the hundreds who bought in that community thinking they would get one kind of a deal guaranteed with their deeds, and now are being presented with something else at the whim of somebody who approached the commission with a proposal to develop the site commercially. If we allow that sort of thing to go on, God help us all.
Adjournment Debate


Mr. Jean-Robert Gauthier (Parliamentary Secretary to Minister of State for Urban Affairs):: Mr. Speaker, first I would like to state to the hon. member for Halifax-East Hants (Mr. McCleave) that I feel very sympathetic, and I feel he has brought this problem to us tonight in a very correct and appropriate manner.
I think it would be proper for us to review first the background of the Lower Sackville land assembly. It was the first land assembly done by the Nova Scotia Housing Commission, and since 1967 the commission has acquired approximately 1,800 acres of land in the Lower Sackville area.
The First small parcels acquired were used as sites for low cost housing, sponsored by co-operatives which required lower priced land than was available on the market in the Halifax area. By 1970 the province had begun to prepare an over-all plan for the land assembly area, but this plan has been revised many times since then. To date between 400 and 500 acres of the assembly have been developed, mostly for residential purposes.
The province elected to acquire all the land on its own account, although federal assistance could have been obtained under the National Housing Act. However, the province has received financial assistance in the form of loans under section 42 of the NHA for the design and servicing of specific parcels of land. To date these loans total $5.4 million and relate to the design and servicing of approximately 400 acres. The block of land in question is not included in this acreage but is adjacent to it.
An early preliminary plan of a section of the assembly shows this particular block as a proposed site for a school, church, shopping centre, and medium density housing. At that time it was intended that the zoning for this block be general, which would permit those uses. CMHC's records do not indicate whether the province and the city proceeded on this basis, although it is known that an alternative site for the school was subsequently selected.
In view of the several circumstances referred to, CMHC is not in a position to question the development plans of the city and province. CMHC does not know the terms and conditions under which the residential lots were sold but would expect the province, as the owner, to comply with zoning requirements and to live up to its commitments to purchasers of lots in or near this block of land. Apparently the province is satisfied that it is doing so. If the nearby residents hold evidence to the contrary, then it would seem that they should take up the matter directly with the Nova Scotia Housing Commission.


Mr. Deputy Speaker:: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until two o'clock tomorrow afternoon.
Motion agreed to and the House adjourned at 10.30 p.m.

Wednesday, December 1, 1976