1976-11-02

ROUTINE PROCEEDINGS


Mr. Paul Yewchuk (Athabasca):: Mr. Speaker, I rise under the provisions of Standing Order 43 to move a motion of urgent and pressing necessity. In view of the fact that in response to a question I put to him on October 28 as recorded in Hansard at page 540, the Prime Minister told this House that during his visit to Japan he had conducted no negotiations with the Japanese concerning possible Japanese investment in the Athabasca tar sands; and in view of the fact that the very next day in response to another question as recorded in Hansard at page 549, the Prime Minister told the House that he had tried to interest the Japanese in the "continuing development of the tar sands" I move, seconded by the hon. member for Burnaby-Richmond-Delta (Mr. Reynolds):
That the right hon. gentleman explain to the satisfaction of this House, on motions, the discrepancy between his two remarks.


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:: Agreed.


Some hon. Members:: No.



PUBLIC WORKS


Mr. Ron Huntington (Capilano):: Mr. Speaker, 1 rise to move a motion under Standing Order 43 on a matter of urgent and pressing necessity. In view of the statement of the former minister of public works in the House on July 13, 1976, that no agreement had been entered into with Campeau Corporation on the Les Terrasses de la Chaudiere project, and whereas the Campeau Corporation had under date of June 28, 1976 an information circular outlining in detail the arrangements made with the government based on an agreement dated November
18, 1975, which was signed on behalf of the Deputy Minister of Public Works, I move, seconded by the hon. member for Central Nova (Mr. MacKay):
That this House instruct the Minister of Public Works to make a statement at the earliest opportunity on motions that will clarify this matter and remove any suspicion that the former minister misled this House intentionally or otherwise.


Mr. Speaker:: Order, please. Pursuant to Standing Order 43 such a motion can be presented to the House only with its unanimous consent. Is there unanimous consent?


Some hon. Members:: No.



CONFLICT OF INTEREST


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I rise to ask leave of the House to present a motion under Standing Order 43 which relates to the matter which was under discussion for some time yesterday as a result of a question of privilege raised by the hon. member for Calgary South (Mr. Bawden). I have tried to draft a motion that is specific in its terms of reference but which does not pass judgment: in other words, it leaves the matter to the appropriate committee I have shown copies of my proposed motion to a representative of each of the other parties and also to Your Honour. I, therefore, ask leave to move seconded by the hon. member for Oshawa-Whitby (Mr. Broadbent):
That the sale in 1975 by Emden Limited to the Royal Canadian Mounted Police of an aircraft and certain parts and the sale in 1973 to the Ministry of Transport by Peter Bawden Drilling Services Limited of an aircraft, including the involvement of the hon. member for Calgary South in these transactions, be referred to the Standing Committee on Privileges and Elections for consideration of the said transactions in relation to the conflict of interest provisions of the Senate and House of Commons Act, that the said committee also consider reports of discussions on these transactions purported to have taken place between the hon. member and Mr. Speaker, and that the said committee report its deliberations and conclusions to the House not later than December 10, 1976.


Mr. Speaker:: Order, please. Pursuant to Standing Order 43 such motion can be presented to the House only with its unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: Order, please. There is not unanimous consent.

November 2, 1976
BBC News FINANCE



PROPOSED INQUIRY INTO FINANCING OF LES TERRASSES DE LA CHAUDIERE PROJECT-MOTION UNDER S O. 43

Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, I rise under the provisions of Standing Order 43 to ask the unanimous consent of the House to deal with a matter of urgent and pressing necessity. As it appears that certain Canadian financial institutions will be advancing $50 million to Campeau Corporation on December 1, as set out in a confidential memorandum dated June 28, 1976, with respect to Les Terras-ses de la Chaudiere property to be rented to the Government of Canada; as it has been revealed that there is considerable question as to the circumstances surrounding this transaction, including the need for the property itself; and in view of certain financing techniques which it appears will cost the Government of Canada tens of millions of dollars, I move, seconded by the hon. member for Elgin (Mr. Wise):
That this House direct the Minister of Finance to immediately inquire into this project and the financing thereof with a view to determining if the project and its financing is necessary in this period of restraint, and to report back to this House upon his findings within the week.


Mr. Speaker:: Order, please. Pursuant to Standing Order 43 such motion can be presented to the House only with its unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



CANADIAN BROADCASTING CORPORATION


Mr. Bill Clarke (Vancouver Quadra):: Mr. Speaker, I rise under the provisions of Standing Order 43 to raise a matter of urgent and pressing necessity. Effective yesterday, without prior notification, the CBC ceased to carry the BBC news direct from London, after over 30 years of daily presentation. I do not wish to quarrel with the reasoning that the Canadian network is adequately staffed to provide extensive foreign coverage without having to depend on outsiders; but the BBC presents the world news with a non-Canadian slant, which is an advantage to all who take their news seriously.


Some hon. Members:: Hear, hear!


William Hillary (Bill) Clarke: I therefore move, seconded by the hon. member for Esquimalt-Saanich (Mr. Munro):
That the Secretary of State be asked to approach CBC officials, with a view to restoring the BBC news to the daily schedule of the CBC.


Mr. Speaker:: Order, please. Such motion can be presented to the House only with its unanimous consent. Is there unanimous consent?
[Mr. Speaker.!


Some hon. Members:: Agreed.


Some hon. Members:: No.



INDUSTRY


Mr. Hal Herbert (Vaudreuil):: Mr. Speaker, under the provisions of Standing Order 43, I move, seconded by the hon. member for Montreal-Bourassa (Mr. Trudel):
That the government recognize the outflow of investment capital from Canada and that the adoption of compulsory licenses coupled with unrealistically low royalty awards has had a depressing effect on industry without providing related benefits to the economy; and that it has had the effect on the drug industry of increasing imports, reducing Canadian production, reducing the growth of pharmaceutical research and removing the incentive to manufacture in Canada.


Mr. Speaker:: Order, please. Such motion can be presented to the House only with its unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Arthur Ronald Huntington: Mr. Speaker, I have a question for the Minister of Public Works. In his absence I shall direct it to the acting minister. As the minister knows, I have been exploring the question of Les Terrasses de la Chaudiere deal made by the government with the Campeau Corporation for some time-by way of order paper questions, Standing Order 43, oral questions in the House and in private discussions with the minister. The answers to these efforts have caused me increasing concern. Can the minister now report to the House, after having spoken to his departmental officials and called for a report regarding the Les Terrasses deal, if the project is really necessary and if it is the most economical and satisfactory way of providing office facilities for federal government needs in the national capital region?


Hon. Marcel Lessard (Acting Minister of Public Works):: Mr. Speaker, answering on behalf of my colleague who is not in the House today, I should like to say that I am well aware, as the House is also aware, of the interest of the hon. member in the question. The minister is also aware and is taking the
November 2, 1976

necessary steps to provide answers to the questions put by the hon. member.


Arthur Ronald Huntington: Mr. Speaker, we have been waiting many weeks now for the report that the minister promised the House. Can the minister advise why the government agreed to the additional $54 million option to purchase Les Terrasses de la Chaudiere, given the fact that the $16.7 million annual rent it will be paying over 35 years will amortize the complete project including the shopping plaza, the hotel and the parking lot?


Marcel Lessard: Mr. Speaker, I suspect that my colleague is also aware of what the hon. member is saying. In any event, 1 will ensure that he is aware of the point the hon. member is making. He probably will be in the House and will be in a position to answer the full question of the hon. member.


LES TERRASSES DE LA CHAUDIERE PROJECT-POSSIBILITY OF CANCELLING CONTRACT
Arthur Ronald Huntington: The same minister has expressed his concern in the House that the agreement entered into with the Campeau Corporation is "a confirmed and binding contract". Given the fact that the agreement is unsatisfactory for the people of Canada, can the minister advise if he is considering a method to cancel the contract, thereby saving the Canadian taxpayers hundreds of millions of dollars, even if it has to pay what appears to be a standard Liberal penalty similar to the $16 million Orion penalty?


Some hon. Members:: Hear, hear!


Marcel Lessard: Mr. Speaker, I will make sure my colleague is aware of the question raised by the hon. gentleman.
LES TERRASSES DE LA CHAUDlfiRE PROJECT-SUGGESTION DEVELOPER PAY IN ADVANCE FOR LEASE OF PART OF COMPLEX


Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I also have some questions for the acting Minister of Public Works. Is he aware that the cost of the Les Terrasses de la Chaudiere project will be underwritten from the revenues of the lease from the government, leaving the income from the rest of this vast project as gravy for the developer, and further that if the government does elect to exercise the option to purchase the development after 35 years, the developer, in addition to the $54 million that it receives at that time, will also have the right to lease the parking lot, the shopping plaza and the hotel areas of the complex for $1 each per year? Perhaps the minister ought, as a symbolic gesture, to insist that the $75 payable for the 25 year period be paid in advance.


Some hon. Members:: Hear, hear!
Oral Questions


THE CANADIAN ECONOMY
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I have a question for the Minister of Manpower and Immigration. Given the fact that Canada is losing about $18 million in the production of goods and services every day as the result of current employment levels, can the minister tell us if he has received the as yet unpublished forecast by the University of Toronto Institute for Public Policy that unemployment will rise even higher in 1977 reaching 8 per cent, and if so, does he intend to act on their recommendation that the most effective immediate step to deal with that unemployment is to bring forward some tax cuts?


Hon. Jack Cullen (Minister of Manpower and Immigration):: Mr. Speaker, having checked into some of the statistics quoted before by the leader of the New Democratic Party, I will want to take a second look. I notice that he always takes the highest possible statistics, never the lowest, when talking about unemployment. I am not satisfied that the tax cuts suggested by the hon. member would be the appropriate approach in view of the fact he is not talking in amounts. He is not saying to what extent we would have to increase the deficit or to what extent we would have to go to the market to borrow which would push up interest rates and hurt the very people he proposes to help.


John Edward Broadbent: The minister may not think my questions are improving with time. I can assure him that his answers are getting worse.


Some hon. Members:: Hear, hear!


John Edward Broadbent: I did a politeness to the minister. 1 could have quoted published forecasts that reach as high as 8.1 and 8.5 per cent. I picked a low one for the minister today. I now want to shift to the Prime Minister. Given the fact that unemployment in Canada has increased by more than 9,000 for every month since the July 1974 election for a total increase during that period of time of more than a quarter of a million people unemployed, and considering the fact that Professor Wilson of the Institute for Public Policy was recently a personal economic adviser to the Prime Minister, will the Prime Minister tell the House if, unlike one of his ministers and given the serious level of unemployment, the government will consider bringing forward a tax cut and do so soon?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, the suggestion of the hon. member will be taken into account along with many others when we prepare the budget.


John Edward Broadbent: The Prime Minister clearly takes a different attitude from his minister. He said he will consider that in the preparation of the budget. In the meantime, nothing of substance is going to be done in terms of the government's announcement in the throne speech and the appropriate minister's speech contribution during that debate, until April 1977.

November 2, 1976
Oral Questions
I should like to ask the Prime Minister whether he can assure the House that something will be done to deal with the serious situation likely to arise in the coming winter, one which, it is anticipated, will see the highest rate of unemployment since the great depression of the 'thirties.


Pierre Elliott Trudeau: Any announcement to be made will be made in the House in the normal course of events.


UNEMPLOYMENT INSURANCE
Mr. Armand Caouette (Villeneuve):: Mr. Speaker, my question is directed to the Minister of Manpower and Immigration.
Could the minister tell this House whether he agrees with his predecessor who proposed to amend the four-week rule in the Unemployment Insurance Act which demonstrated, to his predecessor, that this experience did in fact discourage the recipients from going back to work.
[ English ]


Jack Sydney George (Bud) Cullen: I am not sure I heard the translation correctly, but if the hon. member was referring to the move from eight to 12 weeks, there has been no change in that intention.


Armand Caouette: Mr. Speaker, I should like to repeat my question because it has been misinterpreted.
Does the minister still agree with his predecessor who proposed to take the four-week rule out of the Unemployment Insurance Act and does he want to have this act amended? At the present time, a recipient who finds employment during the extension period of four weeks or more automatically loses all his rights if a company goes bankrupt and if he is forced to turn back to unemployment insurance.


Jack Sydney George (Bud) Cullen: There will be some changes which will make provision for the problem the hon. member is suggesting may occur.


FINANCE
Sinclair McKnight Stevens: Mr. Speaker, my question is directed to the Minister of Finance and it has to do with the Campeau Corporation's scheme to construct and lease property known as Les Terrasses de la Chaudiere to the government. Would the minister tell us whether he is familiar

with a pending $148,500,000 finance arrangement for that corporation and, if so, would he inform the House whether he is aware that these funds are being raised by Campeau for a period of 15 years against Canada's covenant at an effective interest rate of 11 'A per cent per annum, which is to be paid indirectly by Canadian taxpayers and which is approximately \'A per cent above the going interest rate for comparable Canadian financing, representing a net additional cost to the treasury of almost $2 million a year?


Hon. Donald S. Macdonald (Minister of Finance):: I have not been directly involved in this transaction, one which is primarily the responsibility of my colleague.


Sinclair McKnight Stevens: As certain major financial institutions in Canada, supervised under the minister's direction, have declined to participate in this Campeau financing arrangement and have expressed apprehension in respect of the transaction, would the hon. gentleman state whether he has been contacted by one or more officials of these institutions, including some whose head offices are in his riding? Have they conveyed their anxiety to him and, if so, would he indicate the nature of their objections and of his reply?


Donald Stovel Macdonald: I, personally, have not been so contacted.


Sinclair McKnight Stevens: A final supplementary. Would the minister assure the House that he will object to any similar deals being signed in the future by the Department of Public Works or others in the government since it appears such deals are in blatant circumvention of restraint guidelines, resulting in a huge and unnecessary cost to the people of Canada.


Donald Stovel Macdonald: I do not know how well founded the hon. gentleman's allegations are-


Sinclair McKnight Stevens: Very well founded.


Donald Stovel Macdonald: -but I would say to him that under our system of government Treasury Board has the responsibility for scrutinizing all government expenditures of this kind. An expenditure of this kind would in due course have to receive Treasury Board approval.


STATISTICS CANADA
Mr. Ray Hnatyshyn (Saskatoon-Biggar):: Mr. Speaker, may I direct my question to the Minister of Industry, Trade and Commerce and it is in respect of the matters I raised yesterday relating to StatCan. Having regard to the Canada Gazette publication respecting public servants conflict of interest guidelines, I wonder whether the minister would indicate if the chief statistician called for all senior executives to file statements on conflict of interest in June, 1974 and, if so, whether
November 2, 1976

or not the assistant chief statistician and his senior advisor made statements and got clarification of their position with respect to any conflict that might arise by virtue of their working outside of their employment?


Hon. Jean Chr6tien (Minister of Industry, Trade and Commerce):: Mr. Speaker, it is impossible for me today to answer the detailed question of the hon. member. I hope to be able to do so tomorrow. By the way, I would like to tell to the hon. member for Central Nova that tomorrow morning, when the orders of the day will be called, I will table the answers to the 23 or 24 questions he asked about Statistics Canada.


TYPE OF PRIVATE BUSINESS CONDUCTED BY CERTAIN EMPLOYEES
Ramon John Hnatyshyn: A supplementary question, Mr. Speaker. This matter has, of course, been before the minister and I wanted to ask him today whether or not he is in a position to let us know if there is in his possession or in the possession of the department any advertising brochure or prospectus put out by this firm, and whether the assistant chief statistician and his senior adviser were in partnership or carried on the business of giving professional services to private firms.


Hon. Jean Chretien (Minister of Industry, Trade and Commerce):: Mr. Speaker, I would like the hon. member to clarify. There is the assistant chief statistician and then there is the Jeffery Associates. I should like to know to which he is referring.


Ramon John Hnatyshyn: A final supplementary, Mr. Speaker. I am referring specifically to the assistant chief statistician, Mr. Fellegi, and to Mr. Sunter, a senior research adviser. These are the two people in question. This question was raised yesterday with the minister at some length.


Joseph Jacques Jean Chrétien: Mr. Speaker, I would ask the hon. member to put all these questions into writing. The hon. member for Central Nova did this last week. Then, I will be in a position to reply. This is all very technical, involving dates and so on, so I think it would be proper to give a written reply.
 * *


NATIONAL CAPITAL COMMISSION
Mr. Walter Baker (Grenville-Carleton):: Mr. Speaker, following along this matter I should like to ask a question of the Minister of State for Urban Affairs. Yesterday, as reported at page 617 of Hansard, I put this question to the minister:
-I wonder if the minister who since the news reports came out must have taken the time to examine Edgar Gallant can report to the House exactly what Mr. Oral Questions
Gallant said-assuming that such an investigation took place. Also, is the minister in the position today-and if he is not in the position today will he put himself in the position-to table the correspondence which passed between the then chairman of the National Capital Commission, Mr. Gallant, and Mr. Gordon Robertson.
To that inquiry the minister said he would undertake to have the information available to answer "tomorrow", as he said then. It is now Tuesday. Is the minister in a position to answer this question and would he do so now?


Hon. Barney Danson (Minister of State for Urban Affairs):: Yes, Mr. Speaker, seeing that it is Tuesday I am now in a position to do so. I find that the correspondence to which the hon. member referred took place in 1944, on February 22.


Some hon. Members:: Oh, oh!


Mr. Fraser:: So we are referring to Mackenzie King, are we?


Barnett Jerome Danson: Of course, 1 mean 1974, before I assumed this portfolio. Nevertheless, 1 find that Mr. Gallant acted in an exemplary manner. When he found a situation which he thought was not totally correct, he did the quite appropriate thing, as the gifted public servant that he is, and made contact with Mr. Gordon Robertson, secretary to the cabinet. Things were taken on from there, as was appropriate to Mr. Robertson.
[DOT] (M30)


Walter David Baker: Mr. Speaker, I want to thank the minister for his answer as far as it went. Was the contact that he was talking about a letter in accordance with the reports? If so, would the minister table that letter today? If it was not a letter, would the minister make a statement in the House now in answer to the questions which he undertook to answer, namely, what was the purport of the conversation between Mr. Gallant and Mr. Robertson, what circumstances was the distinguished public servant, Mr. Edward Gallant, complaining about when he either spoke or wrote to Mr. Robertson, and what is the detail with respect thereto?


Barnett Jerome Danson: Mr. Speaker, Mr. Gallant was acting as he should, as I indicated. It was a written report, a report which was confidential between him and Mr. Robertson. It is the sort of report that I think even the hon. member opposite, who might have some concern for allegations made with relation to specific public servants, would not want made public. I think that is appropriate. If further action is taken and there is need for disclosure at that time, disclosure should be made. On this particular document, the situation might bear investigation. I would prefer not to table that at this time because it mentions individuals by name. What happened in the subsequent investigation, I am unable to report.


Walter David Baker: Mr. Speaker, I think the minister must have read page 617 of Hansard and the question I put to him as recorded there. The minister knows that it was prefaced by the remark that public servants generally must have their reputations protected, and 1 think he recognizes that concern of mine. I suggest that part of that protection is the
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November 2, 1976
Oral Questions
complete and full disclosure, and I would like the minister to reconsider his answer to me just now, particularly in view or his specific and unequivocal undertaking that he would have the information available to answer questions in the House tomorrow, that being today.


Barnett Jerome Danson: Mr. Speaker, I am answering to the extent that I am able and prepared to do so. As the hon. member knows, the investigation was continued. There are specific questions on the order paper in this regard, and 1 believe my colleague, the Minister of Industry, Trade and Commerce, is dealing with those.


LABOUR RELATIONS
Mr. Jacques Lavoie (Hochelaga):: Mr. Speaker, my question is directed to the Minister of Labour.
The longshoremen issue has always been of deep concern to me because 250 of these people live in my riding. On June 26, 1975, the minister appointed Mr. Roland Tremblay, Q.C. as mediator in the interpretation and application of some provisions of the Montreal longshoremen's collective agreement. Since then, over a year has passed. I wonder if the minister now has a copy of the Tremblay report?


Hon. John C. Munro (Minister of Labour):: Yes, Mr. Speaker, 1 do have such a copy.


Jacques Lavoie: Mr. Speaker, I wish to ask a supplementary question.
Since the minister read the report, could he tell the House what are the main recommendations?


John Carr Munro: They are very detailed indeed. Rather than go into them all-and I think it would only mislead hon. members to go into them in such detail-I would be more than happy to send a copy to the hon. member, and then he can ask further questions if he so wishes.


INDUSTRY
Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, my question is directed to the Minister of Energy, Mines and Resources. As Canadair is now owned by the taxpayers of Canada and as the board of directors has a majority of senior civil servants presumably representing the taxpayers' interests,

will the minister table the document whereby the government authorizes the loan guarantee so that the taxpayers of this country can see what kind of deal the government is getting them into?


Joseph Jacques Jean Chrétien: Mr. Speaker, last Friday in Montreal 1 held a press conference on this matter during which I gave all the information. We guarantee a loan of $50 million, the government of Quebec a loan of $20 million and the balance of the program will be financed through two Canadian banks. Until now the Learstar program is extremely interesting. Fifty-three orders have already been obtained by Canadair's sale committee. I think we must all be pleased that Canadair landed such an interesting program.


A. Daniel McKenzie: Will the minister table the documents which show that Canada has firm orders for 53 Learstars and has extracted deposits from customers for this number of aircraft, who are these customers, and at what price has Canada promised to deliver these aircraft?


Joseph Jacques Jean Chrétien: Mr. Speaker, I cannot table those documents because I think it is extremely important that Canadair do business as any other corporation. In my opinion, the government has the duty to help both these companies, Canadair and de Havilland, create as many jobs as possible in Canada and I was very happy to be associated with such a beneficial undertaking as that launched by Canadair under this program.


ANTI-INFLATION BOARD LEGALITY OF PLACING BRITISH COLUMBIA TEACHERS RETROACTIVELY UNDER BOARD-REQUEST FOR REPORT
Mr. Howard Johnston (Okanagan-Kootenay):: Mr. Speaker, my question is directed to the Minister of Finance. Could the minister report on the situation in British Columbia where the legality of the retroactive placing of last year's arbitrated and legally binding teachers' salary agreements under the authority of the Anti-Inflation Board is being questioned, now that the board has completed the process of rolling back all these settlements?


Donald Stovel Macdonald: Mr. Speaker, I cannot report today but I would be glad to seek a more detailed report and give it to the hon. member.
November 2, 1976


SWINE INFLUENZA-TIME LAPSE FROM VACCINATION TO IMMUNITY-AVAILABILITY OF CERTAIN VACCINES
Mr. P. B. Rynard (Simcoe North):: Mr. Speaker, one of the advantages of sitting in the wings is that you have to participate in Participaction that the minister advocates. My question to the Minister of National Health and Welfare has to do with swine 'flu. In view of the many conflicting reports regarding the time lapse from vaccination to peak immunity and the length of the immunity conferred, and taking due account of variations in people, is the minister able to state what the time lapse and the period of immunity are, and if there are other vaccines available combining the Hong Kong, Port Chalmers and Scotland varieties that have been used on a yearly basis?


Hon. Marc Lalonde (Minister of National Health and Welfare):: Mr. Speaker, in answer to the first part of the question may I say how much I regret certain statements on this very important question made by some CBC reporters which seem to have been made without checking with us. The shelf life of the influenza vaccine from laboratory tests has been estimated to be about 12 months. Based on experience in the United States with type A influenza strains, it is believed that immunity after vaccination could last up to three years in a significant portion of the population, provided there were no changes in the antigenic makeup of the virus.
With regard to various other strains of vaccine such as the Hong Kong 'flu vaccine, a Canadian manufacturer is engaged in the production of bivalent A/Victoria and B/Hong Kong vaccine. Deliveries have not yet been received. It is hoped that the vaccine will be available for the coming 'flu season. In so far as A/Port Chalmers and A/Scotland influenza are concerned, no vaccine is available in Canada at present for either virus.
An. hon. Member: What about the Lalonde 'flu?


Philip Bernard Rynard: Mr. Speaker, in view of the fact that three years have passed now and of our knowledge of the fact that swine 'flu or any of the varieties of 'flu have a habit of repeating themselves in two or three years, is anything being done now to study this possibility and arrange for the manufacture of the vaccine if necessary?


Marc Lalonde: I missed the latter part of the hon. member's question. What possibility did he refer to?


Philip Bernard Rynard: The possibility of having preparations made in case the swine 'flu repeats itself as it did in 1917, 1918 and 1919.


Marc Lalonde: I will certainly take the suggestion of the hon. member under consideration and discuss it with my officials.
Oral Questions


SWINE INFLUENZA-DECISION OF SOME PROVINCES NOT TO VACCINATE-GOVERNMENT ACTION
Paul Yewchuk: Mr. Speaker, my question also relates to the swine 'flu program. In view of the late delivery of the vaccine to the provinces and perhaps a failure to ensure supply in keeping with the demand, some of the provinces have decided not to participate in the monovalent vaccination program. Can the minister say whether he has any plans which will counteract the action by the provinces not to vaccinate so that the Canadian people indeed will have the kind of protection he wants them to have.


Marc Lalonde: Mr. Speaker, first I should like to reassure the hon. member that the decision by some provinces not to vaccinate everybody has nothing to do with the delays which might have occurred to vaccine deliveries. Seemingly, these decisions were made for other motives. As to the availability of the vaccine for all Canadians, I tabled in the House last week a report by a committee of distinguished scientists in this field, the best immunologists in Canada. This paper recommends general vaccination, and I sent the report to all my colleagues encouraging them to follow the recommendations by that committee of experts, as the federal government will do. Unfortunately, I do not think I can do better; for I cannot impose a solution to the provinces.


Paul Yewchuk: Mr. Speaker, I wonder whether the minister can further elaborate. Can he confirm reports that the imports of Bivalent vaccine will be in approximately 40 per cent shortfall supply.


Marc Lalonde: No, Mr. Speaker, such is not my information. The information I got is that we will have available for all Canadian citizens enough Bivalent vaccine to meet the demand. But if my hon. colleague has any specific information in that regard, I would be interested in looking further into that question.


REASON FOR FAILURE TO SUBSIDIZE COST OF ELECTRICITY IN ATLANTIC REGION
Mr. Andy Hogan (Cape Breton-East Richmond):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources. Can the minister confirm to this House whether the total revenue of the oil export tax and the special 10-cent a gallon excise tax which the Minister of Finance indicated would be used for the eastern oil import subsidy is now running in the 12 months ending September, 1976 at a profit of close to $100 million. If so, can the minister indicate why
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November 2, 1976
Oral Questions
the Government of Canada refuses to provide special assistance to Atlantic Canada and particularly Nova Scotia which is facing oil generated electric power rate increases of up to 65 per cent?


Hon. Alastair Gillespie (Minister of Energy, Mines and Resources):: Mr. Speaker, I am not in a position to confirm the point raised by the hon. member. I would point out to him that the government's budgeting is done on a fiscal year basis and that we may well be faced with a substantial increase on January 1 of this year if we are to believe what we read in the newspapers or what our embassies report from abroad in respect of the actions of the OPEC nations. So we have to look at the whole question or our balance in terms of a longer period than the period to which the hon. gentleman referred.
As to the second part of his question, I have pointed out on a number of occasions that as a result of the equalization arrangement entered into by the federal government and the province a substantial, by far the greatest, proportion of the increase in the cost of oil-fired generation which was made necessary by the oil price increase of the federal government will be taken care of by an automatic increase in equalization this year.


Andrew Hogan: Mr. Speaker, the minister talks nonsense when he talks about equalization grants being controlled by the federal government. Since the minister cannot confirm the confidential internal revenue figures I have received from sources within his department, will he report back to the House tomorrow providing us with his information and at the same time will he explain why the Government of Canada is profiting from funds intended to assist in the reduction of the high energy prices in Atlantic Canada? If he is taking a longer period than just this year and looking forward to prospective price increases which might come, will he guarantee that the surplus will be used to help Atlantic Canada and especially Nova Scotia?


Alastair William Gillespie: Mr. Speaker, for the reasons I have already given I am not in a position to confirm that number. It is quite clearly a situation which has to be looked at over a longer period. I would ask the hon. member to look at the record and look at the figures. By the end of this year the federal government will have provided very close to $1 billion in support to Atlantic Canada and in that regard probably very close to the highest per capita assistance has been given to the citizens of his province.


SEARCH AND RESCUE
Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, my question is an attempt to clarify an answer given yesterday by the Acting Minister of National Defence to my colleague from Hastings respecting air facilities for search and

rescue missions as of 1976. As a member for a Lake Ontario constituency where we have had problems in the past regarding the adequacy of facilities for search and rescue operations in the Great Lakes basin, I should like to ask the minister whether the movement of helicopters to Newfoundland in any way would downgrade the facilities for search and rescue anywhere else, specifically in the Great Lakes Basin and the rest of the area.


Barnett Jerome Danson: Actually, Mr. Speaker, I do not think they will be downgraded. They will be reorientated in this feasibility study. Indeed, I think it in some ways would upgrade them. The helicopters being moved from Trenton are being replaced by others from Petawawa which are in back-up position and can serve a much broader area as I see it, and also by the Chinook helicopters which are located here in Ottawa. So there is a reorientation. Indeed, this is the purpose of the feasibility study which is to see where they can operate from at the very best. Indeed, one helicopter at this moment cannot land in St. John's because of weather conditions there. If it were posted there and there was an emergency it might not take off from there. These are the things we are trying to work out at this time.


Allan Frederick Lawrence: Mr. Speaker, the minister uses the word "upgrade". We have already drawn to his attention this afternoon a press release issued at five o'clock last evening after he gave his erroneous impression in this House yesterday afternoon. Perhaps I might quote one short paragraph from this press release. It states:
Although the deployment of SAR Labrador helicopters will provide an improved posture in the Newfoundland area, the overall search and rescue capability for the maritimes and central Great Lakes areas will be degraded during this period.
How does he reconcile the fact that he claims there is an upgrading and the Department of National Defence claims there is going to be a degrading of the facilities in the rest of the country, especially in these two crucial areas right now.


Barnett Jerome Danson: Well, I think, Mr. Speaker, likely a public relations officer may be degraded.


FINANCE
William Hillary (Bill) Clarke: Mr. Speaker, I should like to direct a question to the Minister of Finance. It is supplementary to a question that I asked the Acting Prime Minister last Wednesday. I apologize to the Minister of Finance for the delay in presenting the supplementary, but in light of certain measures on my part during the last two or three months I find that my recognition factor is still quite low. In response to a question about a report from a task force that was investigating European methods of foreign exchange
November 2, 1976

control the Acting Prime Minister said he had not received any such report. I should like to ask the Minister of Finance if he could tell the House when the task force will be reporting and also what preparations the government has made to impose controls which would stop the outflow of Canadian capital to tax havens and other jurisdictions.


Donald Stovel Macdonald: Mr. Speaker, my advice is that there has been no such task force nor is there any now in existence. Since I have been in this office I have given no consideration whatsoever to foreign exchange control.


Mr. Speaker:: The hon. member for St. John's West.


Some hon. Members:: Hear, hear!


POSSIBILITY OF RE-ACTIVATION OF REFINERY AT COME-BY-CHANCE-GOVERNMENT POSITION
Mr. John C. Crosbie (St. John's West):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources. I would like to ask the minister whether any group has approached the Canadian government to ask for assistance in connection with the re-activation of the oil refinery at Come-By-Chance, which has been closed since the end of 1975. What assistance, if any, is the Canadian government prepared to give by way of grant or loan for the purpose of re-activating that oil refinery?
In addition, could the minister tell the House whether he has received a report from Petro-Canada, which was supposed to be investigating the feasibility of its doing anything in connection with that oil refinery?


Alastair William Gillespie: Mr. Speaker, may I take this opportunity to welcome the hon. member to the House-


Some hon. Members:: Hear, hear!


Alastair William Gillespie: -and to congratulate him on a very impressive win. I have enjoyed the opportunity in the past of discussing mutual interests in the energy field with the hon. member, and I look forward to doing so in the future.
As to the question of whether a group has approached us for assistance in the restoration of the refinery at Come-by-Chance, I have heard rumours, but quite frankly 1 myself have received no propositions or proposals. On the question of Petro-Canada, yes, Petro-Canada did have a survey, analysis and study completed for it with respect to the Come-by-Chance refinery. I cannot say more than that at this time.
Oral Questions PETRO-CANADA


POSSIBILITY OF DISPOSING OF COMPANY TO PRIVATE ENTERPRISE
Mr. Gordon Towers (Red Deer):: Mr. Speaker, my question is to the Minister of Industry, Trade and Commerce. A former deputy minister of industry, trade and commerce questioned the political reasoning behind creating Petro-Canada, and he was reported to have said, and I quote: "It is a political mentality turned loose on the oil and gas business, with no rudder, no compass and no anchor; all wind and sail". Does the government have any intention of disposing of this national calamity?


Joseph Jacques Jean Chrétien: Mr. Speaker, I am not responsible for Petro-Canada. 1 will ask my colleague to give an answer, but I do not think he has any intention of disposing of the corporation.


Thomas Gordon Towers: Mr. Speaker, my supplementary question is to the Prime Minister. In view of the fact that the throne speech referred to the possibility of Crown corporations being returned to private industry, would Petro-Canada fall within that category?


Pierre Elliott Trudeau: Mr. Speaker, if the hon. member will return to the throne speech, he will see that the words he uses are not there.


AIR CANADA
Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, I have a question for the Minister of Transport. In view of the minister's statement and policy that transportation should be paid for by users, will the minister be lowering the 75 per cent mandatory share of transcontinental air passenger traffic which Air Canada now enjoys in preference to other air carriers, which should increase competition and make for more efficiency and better passenger service?


Hon. Otto E. Lang (Minister of Transport):: Mr. Speaker, first let me say that the hon. member inaccurately summarizes a much more complicated statement about the appropriate way to get proper transportation services in Canada.


An hon. Member:: All your statements are complicated.


Otto Emil Lang: I see no connection whatever between that statement, in any case-or any part of it-and the following part of his statement.


William Gordon Ritchie: Is the minister considering lowering this mandatory proportion of transcontinental air passenger service which Air Canada enjoys?

November 2, 1976
Oral Questions


Otto Emil Lang: The whole relationship of Air Canada to particular services being offered is a matter being reviewed with a view to maintaining the most effective air service in Canada at the least cost to passengers.


CANADIAN NATIONAL RAILWAYS
Mr. G. H. Whittaker (Okanagan Boundary):: Mr. Speaker, my question is directed to the Minister of Transport and concerns the 200 workers of Chapman Transport in British Columbia. That company is a subsidiary of CNR. The workers who are on strike there are seeking only the same settlement awarded to other transport companies in B.C., which has been approved by the Anti-Inflation Board. Can the minister confirm whether the CNR is intending to close down Chapman Transport, and if not, can he tell us why the CNR is not bargaining in good faith?


Otto Emil Lang: Mr. Speaker, 1 certainly cannot confirm that. I have only seen press reports on the matter. As far as negotiations are concerned, I would not want to comment, and any such question would have to be looked at from a labour point of view.


PUBLIC SERVICE
Mr. Erik Nielsen (Yukon):: Mr Speaker, my question is to the President of the Treasury Board. It is with respect to questions I asked him last Friday which appear on page 580 of Hansard. I wonder if the minister has a reply to those questions now.


Hon. Robert K. Andras (President of the Treasury Board):: Yes, Mr. Speaker. I promised an answer yesterday and tried to seek the floor, as the hon. member knows.
There have been a number of negotiations between the parties, and approximately two thirds of the articles of agreement have been signed off. The negotiations are still in progress. They are with regard to penitentiary personnel and the PSAC. There is tentatively a meeting scheduled for the week of November 8. As the hon. member knows, people in this service in the main are designated and therefore would not be able to participate in a work stoppage and be acting legally. However, that designation is still a matter of discussion with the PSAC and is somewhat in doubt. We have contingency plans ready, but I hope and feel that they will not need to be implemented, in view of the fact that we feel that the negotiations will be successful.


PENITENTIARIES
Erik Nielsen: Mr. Speaker, my supplementary is directed to the Solicitor General arising out of reports of a speech he made in Vancouver describing the correctional service in Canada as a total failure. He is also reported to have said that management and staff at all levels in the correctional system, as well as prisoners and some representatives from the private sector have spent the last year studying the system and that the results of such a study would be released. I wonder if the minister could make available the results of those studies today to the special subcommittee of the Standing Committee on Justice and Legal Affairs, which is looking into the penitentiary system, so that members of that subcommittee might have the benefit of the studies conducted to date in the work they have to have completed for parliament by the end of February.


Hon. Francis Fox (Solicitor General):: Mr. Speaker, I am ready to make copies of my speech available to him and to other hon. members of the House so that they can understand fully the context of the quotation the hon. member took out of my speech.
As for the work of the task force on the role of federal corrections, we are presently assessing the studies which have been made, and we hope to make the document on the role of federal corrections public early in the new year.
 * *


ADMINISTRATION OF JUSTICE
Mr. Stuart Leggatt (New Westminster):: Mr. Speaker, my question is directed to the Minister of Justice, if someone would attract his attention. My question concerns the case of Dr. Henry Morgentaler in Montreal. This individual has now been acquitted on three separate occasions of charges laid against him in Montreal, and he has served ten months in jail even though acquitted of the particular offence. I am wondering if the Minister of Justice can advise the House whether he has interceded. I realize he does not have jurisdiction, but has he interceded with the minister of justice of Quebec with regard to what appears to the Canadian people to be harassment of this individual?


Hon. Ron Basford (Minister of Justice):: No, Mr. Speaker, I have not. Whether people are prosecuted under the Criminal Code is a matter within the sole and exclusive jurisdiction, and responsibility, of provincial authorities, and any intervention by me would be contrary to the relationships and responsibilities which exist under the Criminal Code and would be improper, as would have been any intervention by the province of Quebec with regard to the exercise of my jurisdiction in the matter in ordering a new trial.
November 2, 1976


Stuart Malcolm Leggatt: A supplementary question, Mr. Speaker. In view of the importance of this matter and the widespread concern there is in the country I wonder if the Minister of Justice could advise the House whether in his view the actions taken by the provincial Minister of Justice are correct in terms of his perspective of the proper and appropriate way to go about laying charges where they all come about in one day and they are now being laid separately one at a time against this individual? Is his objective-


Mr. Speaker:: Order, please.



ROUTINE PROCEEDINGS


Donald Stovel Macdonald: Mr. Speaker, I should like to table notice of a ways and means motion with respect to the Income Tax Act.


FISHERIES
Hon. Rom6o LeBlanc (Minister of State (Fisheries) and the Environment):: Mr. Speaker, under the provisions of Standing Order 41(2), I wish to table copies of a notice published in the Canada Gazette on November 1, 1976, respecting an order in council that the government proposes to promulgate the extension of the fisheries limits of Canada to 200 miles, together with diagrams illustrating the proposed new fishing zones.


Some hon. Members:: Hear, hear!


EXCISE TAX ACT AND INCOME TAX ACT
Donald Stovel Macdonald: Mr. Speaker, pursuant to Standing Order 60(2), I should like to designate orders of the day for consideration of notices of ways and means on the Excise Tax Act and the Income Tax Act for tomorrow.
Order Paper Questions


CONSUMER PRODUCT WARRANTIES ACT
A. Daniel McKenzie: for leave to introduce Bill C-376, to amend the Combines Investigation Act to provide for the standardization of warranties and to define the minimum provisions thereof.


Some hon. Members:: Explain.


A. Daniel McKenzie: This is a bill to amend the Combines Investigation Act to provide for the standardization of warranties and to define the minimum provisions thereof. All too often the consumer purchases an automobile, refrigerator, or any one of hundreds of products covered by warranty, only to have the product break down. When the consumer reads the warranty's fine print, he discovers that the document is so full of exceptions and qualifications that it is almost useless. This bill will correct these anomalies.


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

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Ralph E. Goodale (Parliamentary Secretary to President of Privy Council):: Mr. Speaker, the following questions will be answered today: 33, 77, 164, 342, 574 and 769.
I ask, Mr. Speaker, that the remaining questions be allowed to stand.


Mr. Cossitt: With reference to the answer to Question No. 4,109 of the First Session of the 30th Parliament, referring in part to efforts to establish a National Terminology Bank by the Secretary of State in conjunction with the University of Montreal, what (a) is a description of this proposed facility and its purpose (b) is the estimated cost (c) are the reasons for its creation (d) are the number of public service personnel to be involved and their estimated annual salaries?


Hon. John Roberts (Secretary of State):: (a) The terminology bank will involve the computerized collection of terminology in use or likely to be used by government services. Each term in the bank will be defined or used in context, and access to the terms will be provided by various parameters or combinations of parameters (e.g.: area of usage, source, reliability, geographic origin), in each language for which the term exists. The terminology will be multilingual to the extent that the government requires terms in non-official languages. The bank will be instrumental in centralizing available terminological information, particularly for the purposes of translation within government departments, and invaluable in meeting the requirements of language standardization in the Public Ser-

November 2, 1976
Order Paper Questions
vice, especially that of providing work instruments in both languages, (b) According to estimates, the terminology bank will cost $953,500 in 1977-78 and $1,717,500 in 1978-79 (in 1975 constant dollars), (c) The Translation Bureau must be provided with the necessary means to verify terminological data and standardize vocabulary, in accordance with the mandate, conferred upon it by the Cabinet, to verify and standardize the terminology used in both official languages within the Public Service. A terminology bank is the most effective means of keeping up with rapid developments in technical and administrative language and preventing duplication of terminological research, the proliferation of terms and wasted research efforts. It will also be instrumental in meeting the increasing need for terminology when texts are drafted in both official languages, official documents translated, specialized and bilingual personnel trained, uniform work instruments created and statutes or regulations drafted. It will be used to meet the requirement of communication with the public, specialists, units working in French and international organizations involved in standardization and technical or scientific research, (d) According to estimates, 52 persons earning an average salary of $10,663 (in 1975 constant dollars) will be assigned to bank operations in 1977-78, and 77 persons earning an average salary of $11,396, in 1978-79.


Mr. Cossitt: 1.	On or about Wednesday, June 23, 1976, were Anglophone language students at the Carson Road Language Training Centre subjected to a lecture in the French language dealing with the subjects of reincarnation and hypnosis and, if so (a) how many language students were required to attend the lecture (b) what is the name and address of the person who gave the lecture (c) what was the fee paid to the lecturer (d) was it announced that one of his qualifications was that he had at one time "studied electronics" (e) what is the name and job designation of the highest ranking person authorizing the lecture (f) what are the reasons justifying such a performance and how is this consistent with the school's stated objective of teaching the French language and French culture to Anglophones?
2.	Who owned the electronic equipment, including TV equipment etc., that was used to cover the lecture (a) who were the cameramen and any others on duty who operated such equipment (b) who paid their salaries and if they were paid by the government what was the amount involved?


John (Moody) Roberts: I am informed by the Public Service Commission as follows: 1. Students at the Carson Road Language Training Centre were given the opportunity June 23, 1976, to attend a lecture in French, dealing with reincarnation and hypnosis, (a) About 150 students in the second level of language training attended the lecture voluntarily. Attendance was not compulsory, (b) The lecture was given by Mr. Jean Roussier, president de la Societe de Metempsychologie du Quebec. His address is: 1042, rue Echo, Ancienne-Lorette, G2E 1K2. (c) The fee was $300 inclusive of all expenses, (d) In response to questions by students concerning his previous activities, Mr. Roussier noted in part that he had studied electronics, (e) The lecture was authorized by Bertrand Desbiens, Director of Pedagogical Services, Language Bureau, (f) This lecture was a part of the activities which are organized to help students to improve their oral

expression and auditive comprehension of the second language. The subjects of such conferences are chosen to encourage the greatest possible participation of the students. As such, the subjects must be of a general nature, and interesting to the majority of the students. A number of subjects are identified by the students, and the most popular of these are selected as themes for conferences. To augment discussion, the students are asked to prepare questions in advance of each conference with the help of their teachers.
2. The electronic equipment used to cover the conference is owned by the Staff Development Branch of the Public Service Commission, (a) The cameramen and others on duty are employed in the media services unit of the branch, (b) These employees being full time public servants, the amount involved is included in their salary.


PSC COMPETITIONS IN ATLANTIC CANADA
Mr. Forrestall: 1.	Has the government given any consideration to studying whether the Public Service Commission, by its own volition or by legislative restraint, operates competitions in Atlantic Canada which cannot be entered by members of the Canadian Armed Forces who, while posted elsewhere, formerly resided in Atlantic Canada and wish to return to employment in the Public Service in Atlantic Canada and, if not, for what reason?
2.	What is the government's considered view of the effect such a policy might have on Atlantic Canada's efforts to prevent the permanent exodus of talented individuals?


John (Moody) Roberts: I am informed by the Public Service Commission as follows: 1. The answer to this question is negative because of the following: The Public Service Commission is restrained by legislation in determining who is eligible to compete in competitions. When selection is to be made from among persons employed in the Public Service, the candidates' eligibility for appointment, known as the area of competition, is determined by the positions in which they are employed. When selection is to be made from among applicants from outside the Public Service, eligibility for appointment is defined in terms of the area in which candidates must reside. The Public Service Commission has however, established a policy that recognizes the special circumstances confronting retiring members of the Canadian Armed Forces seeking employment in the Public Service. The policy provides, that, where the area of competition includes residency requirements, members of the Canadian Armed Forces may claim entitlement to compete on the basis either of the locality where they are stationed or where their immediate families reside. In its opinion, the Commission can offer no greater flexibility in its policies for the determination of area of competition without both exceeding the provisions of the Public Service Employment Act and being discriminatory in favour of the Canadian Armed Forces.
2. Having no data on the incidence of the return of members of the Armed Forces to Atlantic Canada upon leaving the Forces, the Commission can express no views in response to this question.
November 2, 1976


Mr. McCleave: 1.	Is posted mail sent to particular locations for sorting and, if so, what mail is sorted in Montreal from areas other than the Province of Quebec?
2.	Has any mail, sent for sorting in Montreal, been redirected to Saint John, New Brunswick and, if so, in what quantities and for what reasons?


Hon.   J.-J. Blais@Postmaster General: 1. Mail is first sorted at the office at which it is posted. The practice is to send mail matter directly from the office of origin to the office of address. Where, because of lack of volume for a particular office of address, this is not possible, mail is sent to an intermediate office for further sorting. The intermediate office most used by post offices in Canada for the province of Quebec is Montreal, and therefore mail originating all across Canada is sent to Montreal to be forwarded to its final destination in the province of Quebec. In addition to this, Montreal is one of the main terminating points for air mail from overseas destinations, and mail addressed to many points in Canada is sent to Montreal by foreign administrations for transmission to points in Canada.
2. No, except that mail originating in Quebec province addressed to smaller places in New Brunswick, which had been sent to Montreal by smaller post offices in the province of Quebec because there was not enough to make a direct despatch, may have been sent to Saint John for transmission to points in New Brunswick.


Mr. Reynolds: Can all government cheques be processed through the automatic mailing machines in post offices?


Hon.   J.-J. Blais@Postmaster General: All government cheques which bear a valid postal code can be processed through the equipment, provided the envelope and its enclosures meet Canada Postal Standards.


Mr. Cossitt: 1.	Did Mr. Dave McIntosh of the National Capital Commission appear on CBC National Television News on September 2, 1976 and refer to certain statements made by the Honourable Member for Leeds on the subject of the Prime Minister's summer residence at Harrington Lake with the words: "That's a lot of crap" and, if so, is the government aware that the CBC script for the National Television News of that date quotes Mr. McIntosh as using such words?
2.	Is it the policy of the government to permit public servants to refer to statements made by elected representatives of the people as "crap" and (a) if so, on what date was this policy instituted and by whom (b) if not, what steps are being taken to see that public servants use proper language when making statements of any kind to members of the news media?
3.	Who instructed or authorized Mr. McIntosh to give interviews to various news media on the date in question and what is their job designation?
Protection of Borrowers and Depositors Hon. Barney Danson (Minister of State for Urban Affairs):
In so far as the National Capital Commission is concerned: 1. Yes.
2.	No. (a) not applicable (b) In this particular case a more proper word might have been "rubbish".
3.	No one.


Mr. Speaker:: Shall the remaining questions stand?


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Monday, November 1, consideration of the motion of Mr. Abbott that Bill C-16, to provide for the protection of borrowers and depositors, to regulate interest on judgment debts, to repeal the Interest Act, the Pawnbrokers Act and the Small Loans Act and to amend certain other statutes in consequence thereof, be read the second time and referred to the Standing Committee on Health, Welfare and Social Affairs.
Mr. Pierre De Bane (Matane):: Mr. Speaker, as I said last night on this bill, we rejoice in its presentation though I regret, naturally, that the government as a federal institution, should have waited so long before bringing forward this very important piece of legislation.
I also said that, Canadian personal debts having increased considerably in the last ten years, to the extent of now representing almost 22 per cent of their disposable income, it is that much more imperative for the government to present those amendments today. What makes this bill interesting is the fact that, once again, its scope is extremely vast. It encompasses all transactions that can concern Canadians individually, and small businesses in the field of borrowing, as well as all Canadians with regard to managing their savings.
In addition, it increases the quality and quantity of credit information; it eliminates useless complications in the field of credit, it reduces to a large extent the possibility of excessively high rates of interest on credit, for we are introducing here the concept of unwarranted interest rates by making it incumbent upon the lender to prove that the interest he charges the borrower is in fact a just rate considering the risks involved and the cost of the capital. We are also introducing the concept of a criminal rate in that when the lender's rates clearly exceed justifiable ones, the guilty is liable not only to a fine but also to imprisonment.
678

November 2, 1976
Protection of Borrowers and Depositors
Through this bill, we are also able to rationalize the federal legislation and to establish a strict and uniform legislation regarding consumer credit regulations. Yesterday I expressed some doubts about the constitutional character of this bill and I asked the minister to dispel the fears expressed on this matter by some hon. members, particularly by the hon. member for Edmonton West (Mr. Lambert). I think a good way to understand the significance and timeliness of this bill would be to give examples of some conditions we have today in Canada and against which there is absolutely no legal protection. For example, most depositors are not really paid interest on their deposits as the computation of interest on deposits is made half-yearly on the lowest balance in their accounts. Consequently, tens and tens of millions of dollars are thus lost because that procedure is precisely opposite to that used by lenders when they compute the rate of interest for borrowers.
Another example. If we think that our solvency will allow us to get lower monthly interest rate levied on our loan, we are no doubt deluding ourselves. Yesterday, 1 referred to the same individual who applies to the same institution but does not use the same system to borrow money, either a bank credit card, a negotiated loan or a term loan. He will be granted a loan with different interest rates.
It is the same for advertising. The various financial institutions are allowed to announce a certain interest rate on savings when in fact the interest rate is much lower. For example, it is quite possible to announce that an interest rate of 8 per cent will be paid on deposits when indeed it will be 5 or 5.2 per cent while this reference to 8 per cent in an advertisement is legal. At the same time, interest charged to borrowers is often greater than the interest rate announced. This is another area that will be settled through this bill. As I said yesterday, this legislation will provide us with the necessary means to pursue lenders who charge usurious rates: 300, 400, 500, and sometimes as much as 2,000 per cent. I recalled yesterday that according to the best information we have, police forces feel that loans at usurious rates now constitute the second financing source of organized crime, of the underworld, the mafia.
This piece of legislation will also provide police force with a toot to dry up this very important source of financing organized crime in Canada. These are but a few aspects of this bill and I hope that through committee deliberations all hon. members of this House will entertain the same spirit to improve the bill where they think certain aspects deserve to be improved. I would like some explanations on the possibility of calculating interest rates on a daily basis. I would like to know to what extent this responsibility will be feasible under this bill for small lending companies. Would not calculation on a monthly basis be more realistic? It is up to the minister to supply us with figures. The responsibility should not be too costly for lending companies or, conversely, it would frustrate borrowers of very important sums. But, on first approach, it seems to me that generally, for relatively small loans, calculation on a monthly rather than on a daily basis would be adequate.

Mr. Speaker, I am glad this bill has been introduced and I hope it will not be the object of a filibuster similar to that which marred the introduction of the first bill on competition. I think that Canadians generally agree that we have not really done much up to now to protect them in this area. In my opinion that is why this bill, which meets a pressing need on the part of Canadian consumers, arrives in the nick of time.


Arthur Ronald Huntington: Mr. Speaker, 1 rise to participate in the debate on Bill C-16, the borrowers and depositors protection act. I acknowledge that this is an important bill and wonder, with respect to a bill of this magnitude, of such far-reaching effect on the social scene and to the financial community of Canada, why the opposition was given only 120 hours between first reading and second reading to prepare itself for debate. We are left in this position: as debate proceeds, research papers 60 and 70 pages thick are arriving. We are supposed to know the contents of those papers to make sure the people of Canada are getting improved legislation in this area. I ask, what is the rush with this bill? It is important legislation.
I am greatly concerned because the bill relies heavily on regulation. Throughout the bill there are references to regulations, which indicates to me that the homework done by its drafters was somewhat inadequate. I noticed that in his introductory remarks the minister complimented his staff. I congratulate him for acknowledging the hard work they have done and the extensive communications his departmental people entered into with other departments of government. But having read the bill two or three times, together with some of the available research material, I am led to conclude that there has been little consultation with the business community on some of the spin-off effects of the bill in the private sector. I ask, why would a new, ambitious, obviously smart, somewhat brilliant and youthful minister rush in-


An hon. Member:: Don't get carried away.


Arthur Ronald Huntington: He is a pretty bright guy. Why would this minister rush into a portfolio from which a wise, respected old owl saw fit to rush out? In my opinion, the Department of Consumer and Corporate Affairs has not brought forward much successful legislation, its legislative record is not good. Nor has it been able properly to enforce existing consumer legislation. Perhaps I can say that the only reason I am in the House today is my astonishment with a former minister of that department who was unable to understand that there can be two points of view.
I am deeply concerned about some aspects of this bill, and completely sympathetic to others. I wonder why the bill was not given the benefit of further consultation with other interested parties affected by it, so that we could look beyond the purview of political opportunism and not get caught in the fly-paper, which is what I feel will happen. The political anxiety to serve the consumer will create secondary effects
November 2, 1976

which, with more preparation and more listening to a wider audience, could have been prevented.
Let me now list those parts of the bill of which I fully approve. I compliment the government on requiring full and complete disclosure of all loan costs. 1 think this step is past due. Also, credit charges are to be calculated on a net principal sum, which means the net money the borrower actually receives. This, too, is a step in the right direction. The bill deals with control of advertising, which 1 agree is important. We agree with some provisions of the bill which apply to some lenders. The bill contains provisions with respect to the prepayment of fixed rate mortgages. I agree with the implementation of this aspect of the bill in a market of rising interest rates. However, I do not think provisions concerning variable mortgage rates have been well thought out by drafters of the bill and I shall deal with that point as I proceed with my remarks.
I believe that the maintenance of requisite records is necessary if the bill is to be meaningful, but wonder how many man-years of employment will be created in any new bureaucracy set up to deal with such matters. As the minister said in his press release, the bill places great emphasis on the curtailment of loan-sharking. 1 agree that coercive acts, threats or certain misrepresentations in this regard on the part of lenders should be brought under the Criminal Code. There is not any member on my side of the House who does not recognize that these are important aspects of the bill, and I hope that other parts of the bill can be improved as we study it. We hope that eventually good legislation will be placed in the statute books. However, I would not want to see the very positive aspects of the bill disrupted or discouraged, with unforeseen hazards and damaging repercussions to the business sector of this country. One thing that has happened to this country since 1972 and that we are paying for today is disruption of the decision-making base. We have a tendency to legislate in order to curb and correct abuses. This is good. However, let us make sure that we do not add more confusion to the productive sector of the economy which is having great trouble today.
I have said before in this House that one of the problems we are having in the west with this type of legislation and legislation that relies extensively on regulation is that we do not trust the federal scene anymore. That is why I have offered some comments about my concern as to why this bill is being rushed into the House and why it is being put before the health and welfare committee instead of the finance committee. 1 repeat my regret that I have not had an opportunity to become fully researched and aware of all the implications of this legislation.
Having seen how some of the committees have been manipulated and handled in the past, 1 have to wonder how extensive a hearing the bill will receive in committee, and to what kind of manipulation it will be subjected by the steering committee and the standing committee it goes before. Will the banks, trust companies, mortgage companies and financial institutions in this country be encouraged to present briefs so that we
Protection of Borrowers and Depositors can minimize the spin-off, detrimental effects that some of these measures might have within the country? Like some of my colleagues, I have very real concern about the effectiveness of the committee system as it is presently being managed by some ministers.
In the research leading to this bill there have been extensive briefs from consumer organizations. As far as my files are concerned, there is an absolute dirth with regard to briefs from the industry which have been the subject of this legislation; this is a void of which industries, if they read Hansard, should be aware. When the bill comes back into this House at report stage, 1 hope that suddenly many aspects of the Canadian community do not only then wake up to the fact that very serious legislation is being imposed upon them. I would like to see full input at the committee stage of this bill. I hope the minister will encourage that type of activity in the steering committee proceedings and in the committee proceedings.
There are some spin-offs that will be quite serious in the Canadian community in the attempts to bring about legislation that will protect the low income borrower. I hope these spinoffs can be prevented and the bill can be kept within its original intent and principle. 1 wonder if the authors of the bill and the minister are fully aware of the changes that will be forced upon the community.
In the time allowed me to participate in this debate I will try to bring out one or two areas of real concern. Is the bill going to dry up funds and aggravate, rather than alleviate, the situation for the marginal borrower? I hope that in committee there will be full exploration of that aspect and that there will be incentives left or placed within the industry to serve the needs of the low income borrower. To what extent will the bill centralize the lending power of the industry into federal hands? Do the provinces really agree with this centralization? Has the minister had full discourse with his counterparts on the provincial scene? According to a paper that I was able to have typed up just yesterday, there are extensive legal debates ahead for this piece of legislation as it is presently drafted. I have been talking to people in two provincial departments. I find that they are going to resist any centralization of these powers or interference with powers that they are already enjoying in legislation that they implemented well in advance of this bill being presented to the House of Commons.
Is the minister fully aware of who will be the real beneficiaries as a result of this legislation? The reason 1 ask a question of that nature is that we jumped into the situation where we could offer the Canadian taxpayer tax relief through registered retirement savings plans. We now find our mailboxes filled with letters from people cashing in their registered retirement savings plans for the annuities that are allowed. These annuities are going into the insurance companies of Canada. All the holders of RRSPs are getting back is a rate of interest return on their principal which is less than the interest rate the government will be paying on the Les Terrasses de la Chaudiere project. The principal remains for the benefit of the issuer of the annuity. That is a secondary effect respecting which we will have to offer corrective legislation. I trust that in
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Protection of Borrowers and Depositors our committee deliberations we will not fall into that kind of situation with this bill.
There is another matter that causes concern. I ask this question in all sincerity. What will be the extent of the abuses leading to some chaos within the industry if borrowers arbitrarily stop payments? If this risk exists, who will lend money under that kind of program? What worries me is a newspaper report which appeared in the Globe and Mail. You get this kind of implication on this aspect of the bill, "If you think your loan rate is too high, you can simply stop making payments and force the lender to take you to court. The lender must then convince the court that the rate is not too high." If there is one problem we have in this country, it is that our judicial system is not working. It is overloaded; it is abused. Yet here we are creating a situation where if an individual feels an interest rate is too high, he can stop payment and force the lender to take him to court, further adding to the burden on the justice system and choking it.
I should like to examine the clause dealing with variable rate mortgages. It was reported almost two years ago that trust companies in Canada encountered serious liquidity problems on a break-up basis. I wonder whether the minister has considered this aspect of the legislation and the effect it will have on the industry. At the present time the industry is working within five-year term mortgages. Lending institutions borrow on five-year guaranteed income certificates and lend their money on five-year term mortgages. It is considered sound practice that the certificates be back-to-back against mortgage lending, and the mortgage companies will probably want deposits to match their obligations.
What will happen to companies which have committed themselves to five-year certificates at, say, the present rate of 1OV2 per cent, when the government comes along and changes the rules? As you know, Mr. Speaker, the government has a record of creating confusion by changing the rules in midstream, and I am afraid this is what is being done now. It has changed the rules by allowing prepayment without penalty after 36 months. What this means is that three-year term mortgages, not five-year mortgages, will be the mode of the day.
It is my belief that in the government's anxiety to get this bill before the House it has failed to consider the disruption the legislation will cause in the country. Has the minister really considered all the consequences of what he is proposing to do? For instance, how can a new family formation commit itself to a mortgage for a long-term need on the basis of three-year term renewals? Is this fair to the borrower? What assurance is there that he can afford the renewal?
We find ourselves approaching the definition of the demand term of money. It is likely that many borrowers would not have the opportunity to obligate themselves with respect to a long-term financial need when the rules of the game covering their commitment get narrower and narrower. Today, in Canada, our prime lending rate is about 4 per cent higher than

the prime lending rate in the United States-IOV2 per cent as compared to 6V2 per cent. Perhaps this country will return to sanity. Perhaps interest rates will go down and the right to own private property will be within the grasp of the rank and file of the emerging generation in Canada.
Maybe we shall accomplish a decrease in the cost of living and increase the purchasing value of the wage dollar. Maybe after the next election a measure of sanity will return to the Canadian scene and the gap between interest rates here and in the United States will narrow. Should these things happen, mortgage rates would fall and there would be a rush of prepayments on the thirty-sixth month anniversary. What happens then to the company which has covered these funds with five-year guaranteed income certificates at 1OI/2 per cent?
I ask the minister this question, also: Where does this legislation offer an incentive to drop interest rates? There is nothing here which would encourage an adjustment in the rate on the part of the lender. I suggest that this prepayment clause is likely to have serious secondary effects and would lead to three-year mortgages which offer no protection to the borrower with a long-term need. Short terms for long-term borrowing purposes represents a definite change in our system. It is my belief that even variable rate mortgages should provide for five-year fixed payments if the real interest on the unsophisticated low income borrower is to be served.
I would be the first to agree that some trust and life insurance companies have been most unfair in enforcing penalty clauses on borrowers in a rising interest market. Such greed and stupidity deserve corrective legislation. I have no argument with that idea at all. When a man managing the affairs of a corporation wants more from the community than he should clearly be asking, we have no choice but to legislate against such excessively self-interested behaviour. However, I should like to see such corrective legislation take into account all the spin-off reactions. The problem which would face the community as a result of the variable rate mortgage provisions is one of them.
In light of possible risks to the liquidity of trust companies in consequence of this legislation-and I pointed out earlier that the companies have already encountered serious liquidity problems-I wonder whether the government should not increase insurance requirements on deposits from the present $20,000 limit up to, say, $50,000 or even $100,000. I make this suggestion bearing in mind that the deposit-taking institutions are being exposed to new risks, and in these circumstances an increase in deposit insurance should be considered parallel to the present bill becoming law.
To return to the subject of the variable rate mortgage for a few moments, one of my concerns is this: what will be done with the principal amount if there is a fixed payment for a term and a variable is interjected? There is a difference here which must be considered. This brings us to the question: Under this legislation, is the review period now to be three years? How, and where, is the difference to be applied? Will it be applied to the principal outstanding, or to the interest on the transaction, or to the term of the transaction? It would
November 2, 1976

appear that a fixed term is needed for the sake of the borrower. I have already stated my view that three years is too short and that we should be looking at a five-year term as a minimum. If a borrower has not paid in enough money, he will be short at the end of the term. The little person, the unsophisticated borrower we are trying to protect, will not know how much he is short, or over. If he is sucked into a mortgage in a low interest period, perhaps he will be outside the guidelines under which he qualified for the mortgage in the first place.
For example, a man raises a $40,000 mortgage, a high ratio mortgage under which 95 per cent is advanced against it. He has a $40,000 need, and he borrows $38,000. Being a low income borrower, he will need insurance, so let us add another $400. He has now borrowed $38,400 against a $40,000 need. The mortgage is now at 96 per cent; the ratio has increased. Assume there is a 1 per cent interest change three years down the road. This will mean that this low income borrower will have a shortfall of $1,000. In this case the mortgage could be worth more than the house cost. If the market is not up, or if the house is in bad repair and the lender does not want to renew the mortgage, what is this low income borrower going to do?
One question which I do not find answered in the legislation is this. Is any provision made for a renewal clause for the protection of the borrower who finds himself in circumstances such as I have described? Or are we getting borrowers into long-term debt with a short-term demand, and is there any stability in such a situation for them? If existing mortgages can be prepaid, I submit that trust companies are opened to a new exposure which heretofore has not existed. This is why we need to know what will be the new regulations that are continually referred to throughout the bill. I think many of the unknown factors that have created the kinds of concerns I have described will become more serious as we conduct research and discuss matters with the institutions affected.
Another situation that I do not see covered by the bill is that of a company which owns its own mortgage company. A company in that position could put a loss leader on the mortgage and make an excessive profit on the price. What is the low income borrower going to do in that kind of situation when he has a short-term renewal on the mortgage? I have to ask, how far does the government want to go in protecting the unsophisticated borrower? Perhaps the answer lies in a very carefully designed educational program and in giving more assistance to our primary, secondary and tertiary educational institutions to teach the public these very simple facts of life.
Although I have not had a chance, as I have said, to hear from the various institutions affected by this bill, Mr. Speaker, I hope their concerns will be made known to us before the bill gets to committee. I have not had a chance to prepare myself in a technical way for this debate, but I have taken the opportunity to describe one or two aspects of the bill which are of concern to me.
Protection of Borrowers and Depositors
I think this bill is major departure from past statutory schemes, and we will have to be very careful in our deliberations to become fully aware of the legal debate that we are creating between provincial and federal jurisdiction. The provinces really do not want provincial responsibilities interfered with, and this bill, along with the Bank Act, is of concern to certain provinces. I am sure that others will also participate, on this aspect in the coming debate.
The minister goes far beyond his press releases when he submits to the people of Canada that this bill is designed to protect consumers from loan-sharking. The bill has many ramifications for the social scene, some of them very beneficial. I believe all of us have a real challenge ahead in committee to try to create out of this bill a piece of legislation that will be of benefit to the Canadian community as a whole.
There is one other small point that I overlooked, Mr. Speaker. The Post Office says that mail is the property of the receiver at the time of the postmark. The bill implies that lending institutions have an obligation to debits and credits on the date of the postmark. I do not have to remind all members of the House of the chaotic state of the postal service in this country today. We do not give the lender a fair chance to adjust to the ever-lengthening time that it takes to deliver mail or to the mail load that arrives on a Monday. Where in the legislation is it provided that the lender cannot throw away the postmark, and how are we ever going to get ourselves into a situation where we can administer a statute which provides that the postmark applies when dating debits and credits in an account? These are matters that I should like to see cleared up.
I also note that we are talking of a prime times seven factor as being a criminal rate of interest. I do not know where that came from, and some time during this debate I should like to hear the reasoning behind and the rational for a 73.5 per cent rate as being anywhere within the ball-park of a borrower's needs in Canada. I believe my time is up, Mr. Speaker, and that is about the limit of the meaningful comments that I can offer to the minister and his staff on this bill at this point in the debate.


Harold Thomas Herbert: Mr. Speaker, I was somewhat amused by the remarks of the last speaker when he said he had not had a chance to prepare himself for these discussions or to confer with the institutions involved. 1 find it amusing that the official critic for the opposition was critical of the time it had taken to produce this bill. Most of us have known that the bill has been in the works for a considerable period of time, and those of us who had a genuine interest took the trouble to contact the institutions and other persons interested in the bill in order to find out their opinions so as to try to provide that input.
The borrowers and depositors protection bill which we are debating today is consumer-oriented legislation which should meet with general approval. The objectives of protecting Canadian borrowers against loan-sharking and excessive interest charges, and of providing the public with more and better information for all credit deposits and transactions, should be

November 2, 1976
Protection of Borrowers and Depositors accepted by everyone. However, the intention to define strict and uniform rules to protect all borrowers and depositors could result in some disagreement as to the degree and extent to which these rules should apply. Canadians have the right to demand a high minimum standard of protection in their consumer credit ratings. The new bill requires savings institutions to disclose fully such information as the effective annual rate of interest offered and the true amount of service charges, and to credit interest to depositors' accounts at least monthly so that savers can earn the best possible return on their savings dollar. It is this point to which I shall refer later.
For the first time, all borrowers will have the unlimited right to pay off any mortgage loan at any time without penalty charges. This unlimited right of free payment will enable the borrower to retire a higher interest rate loan and to change, without penalty, to the lowest cost loan available to him or her. Under the new bill, mortgage lenders will be required to disclose fully all costs and terms of a loan at each stage of a credit transaction. Their advertising will have to spell out the rates and all the other conditions under which credit is given. Their collection methods will be regulated and subjected to criminal prosecution for harassment, threats and other coercive practices.
The BNA Act gives the federal government exclusive jurisdiction over interest, and all transactions where interest is involved must therefore be considered to be within federal jurisdiction. Banking institutions grant a major part of consumer credit and they fall exclusively within federal jurisdiction. May I add that a mortgage borrower should be fully protected at the time of a mortgage transfer. It must be made obligatory that an institution or individual selling a mortgage to another must advise at that time of any difference in the principal amount outstanding from the sum which the borrower would have normally believed to be outstanding under the principal repayment terms contained in the original agreement.
The bill is also aimed specifically at loan-sharking which is now big business in Canada, exceeding $3 billion annually and still growing. Police investigations show that real rates of interest charged by loan sharks can range as high as 1,500 per cent. However, nearly two-thirds of consumer credit is granted by institutions falling exclusively under federal jurisdiction, such as chartered banks.
I have some misgivings that certain provisions in this bill would better not be considered with the upcoming revisions to the Bank Act. I fully support the establishment of a national data bank on the extent and use of consumer credit. It is of prime importance to set up a national data bank to determine and monitor the extent and uses of consumer credit. Lenders will have to keep records and submit reports their lending activities. The data obtained will be very useful when the time comes to formulate new policies on consumer credit at both the federal and provincial levels. I assume that committee
[Mr. Herbert.)
discussion will adequately reassure those who are concerned about any invasion or loss of privacy in this particular section.
Now I would refer briefly to another of my concerns. It is always difficult when we discuss a good bill such as this not to appear to be against the bill if we criticize certain provisions. Nevertheless, the bill will be thoroughly discussed in committee, and presumably the minister is noting my comments. It was reported that the assistant deputy minister of consumer affairs said that the new consumer credit bill would encourage deposit-taking institutions to move gradually toward the daily calculation of interest payments. According to the Montreal Gazette, it was stated that a person with $200 in an account at the beginning of the month and who saves $50 a week would receive $2.31 interest that month, based on daily calculations at 8 per cent. Calculated on the monthly minimum balance basis now used at most banks, the interest payment is $1.33, a difference of about $1.00.
I know that the provisions of the bill have been changed somewhat from the documents that were originally given to us, in that now the daily balances are added so that there will be one monthly computation. Nevertheless, the effect, so far as the borrower is concerned, on his interest payments will remain the same. The previous minister of consumer and corporate affairs wrote to me as follows:
The present banking system of computing interest on the smallest balance in a six-month period permits the banks to use the full total of deposits at their disposal for that period, which they loan out at the highest attainable lending interest rate, and for which they pay the lowest possible deposit interest rate. This proposed legislation is intended to correct that imbalance.
Then he went on to say:
-there is no requirement for banks to pay any interest on any type of deposit. They do this only as an inducement to obtain funds which they can then lend at a profit.
Computing interest costs about 20 cents per calculation and entry to the account costs another 20 cents. Thus, there is a cost involved. I want to emphasize that point and I will be coming back to it. The banks have paid interest on minimum balances to keep the costs of administration down, not to reduce the cost of funds. The banks also make available a range of certificates of deposit of varying maturities from 30 days to five years on which interest is paid at rates higher than the true savings deposit rate.
Any regulation has a cost, and that cost must be paid by the consumer. So we must examine who will benefit and who will pay, and from that assess the advisability of the regulation. The banks many years ago changed their system to attempt to eliminate the fluctuating overdraft account. In its place the borrower, by demand note, stabilized his borrowings. This system, whilst costly to the heavily fluctuating account, had little or no effect on the longer term borrower. Undoubtedly, the consumer ultimately pays for all costs resulting from government regulation. I should interject here that this is not an argument against government regulation; it is just recognition of this fact before we proceed any further.
The daily addition for interest will, obviously, involve a charge that will be passed on to the customer, presumably in
November 2, 1976

the form of reduced interest rates. Such a reduction will be applicable to everyone having money on deposit at the bank. It will thus impose a penalty on those who will receive no increase in revenue from the revised method of calculation. Those who have fluctuating sums on deposit will be encouraged to delay payments. They are the least preferable accounts for the banks, yet are the only ones that may obtain some very slight benefit from the new system.
The three points that I have raised are not, under any circumstances, of such import that 1 would consider protesting to the minister about this particular bill, but they are points which I think are worth raising at this time for committee investigation. Let me reiterate those three points. Forcing the bank to compute interest on a certain basis without being able to determine what the interest rates will be, or whether, for that matter, the banks should pay any interest at all, seems to me an exercise in futility.
I also raised the subject of mortgage transfers. I did that because of my very serious concern about the manner in which mortgages have been transferred or sold between one financial institution and another to the point that the householder may not be advised, because there is nothing in the legislation to ensure that he is advised, that there could possibly have been an error in calculation, or possibly all kinds of trouble, and at the end of the period of the mortgage, whether it is 20 years or 25 years, at which time he expects he will have finished paying off the mortgage, he finds there is a principal sum outstanding. Instead of 20 years, it is now 21 or 22 years, or instead of 25 years it is 26 or 27 years. He might be too far down the road before he realizes there could have been an error of which he was not aware because there is no regulation which requires he be brought up to date.
My third point concerns privacy. The data bank is an excellent idea. I assume many people will be concerned that the information gained by this bank could become too readily available. At the present time there is no doubt that credit information is passed between groups without the knowledge of the individual involved. Although this perhaps applies more when we consider the revisions to the Bank Act, nevertheless it is also applicable to this bill. There is at the present time the practice where a borrower does not have the freedom to go from bank to bank to try to obtain the best deal. In fact, if a person should go to another bank it is almost certain that an inquiry will be made of the banker with whom the person has previously borrowed money. The borrower is likely to be told "I am sorry: we cannot lend you the money you wish". The reason, simply, is that there is co-operation-I will use that very general term-between the banks, which means there is not the same freedom for a person to shop for a loan from a bank as there is when shopping to buy a suit or, for that matter, when one goes to various stores to establish a credit account.
Perhaps it is not in the consideration of this bill that this particular point should be raised, but 1 hope that in committee
Protection of Borrowers and Depositors this matter will be explored. I have already said that my three concerns are not major concerns, but nevertheless I thought them to be of sufficient importance that they should be brought to the attention of the minister on second reading.


Mr. Arnold Peters (Timiskaming):: Mr. Speaker, as the previous speaker mentioned, it appears that the minister has taken a first step in the right direction. I think most of us will agree there are clauses in this bill which are worth while, but the more one reads it and the more one listens to the speeches made, the more one wonders how much good it will do in the direction in which it is going.
I listened to the two previous speakers. The argument was made that they did not have too much time to talk about the details or to examine details. But they did a heck of a good job on behalf of the finance and trust companies of this country. They have talked to them, and it appears to me that they have forgotten about the people who will be involved in these loans.


Mr. Abbott:: Who says so?


William Arnold Peters: I say so, because I am one of them. I speak from experience. I have had many contracts with Household Finance and one or two other finance companies, and I know how they work.


John Allen Fraser: You know about a bad loan?


William Arnold Peters: Yes. I would be happy to tell you about my experience concerning what they considered to be a bad loan. These finance and trust companies are not the great heroes they are made out to be. They receive a parasitic benefit from their financial structure which should not make anyone proud to defend them, because they operate upon the misery of those who need to obtain goods and services and who can obtain those goods and services only by borrowing money at great expense.
The hon. member asked whether I have had any experience with bad loans. This is something the member perhaps should think about. I can remember when I was a miner in Timmins having a loan, as did many members of the union, with Household Finance. I remember that I owed them $300. I was maybe a little more practical than some of the other miners, because I had $300 in the bank. However, being one of the union lads, and since no one else could make their payments to the finance companies, I would not make my payments either.
When I travelled around the country raising money for the strike at that particular time, it was not unusual for me to find a representative of Household Finance waiting for me at my hotel room at 11 o'clock at night. He would harass me. He wanted me to give him $1 on account. This would not pay for the bother of harassing me, but he harassed me every night. He wanted to know who was paying for the hotel room. He wanted to get his finger on one dollar. I refused to give him one dollar, because if none of the other miners could pay one dollar, why should I pay him?
When I went to Windsor, the same thing happened. Another man was at the hotel and there was more harassment. It was

November 2, 1976
Protection of Borrowers and Depositors
interesting talking to these people. They could not understand why I would not make a payment when I had the money in the bank. They did not see the principle that was involved in my not paying them. It is also interesting that when I went to pay them after the strike, I paid them off in full and they did not charge me any interest for the period during which I had made no payment: there was no penalty.
This talk about penalties and assessments is a lot of hog-wash. It depends on the circumstances. This is not really where the problem lies. The minister has considered floating the interest rate on loan companies. I was here, as I believe were some other members. When we last changed the Bank Act. This minister should be fairly familiar with some of the changes which have taken place in the Bank Act, since he comes from a family which had something to do with some of the changes in days gone by. What statement was made when we changed the interest rate from a fixed rate of 6 per cent? We were given a great deal of hogwash from the financial institutions. Everybody went around and saw them. They were well prepared. We were told that if the ceiling was taken off interest rates, they would go down. So I presumed that instead of having a 6 per cent interest rate we would have a rate of 2 per cent or 3 per cent. That did not happen.
When interest rates are not controlled, they go up and up. What really shocks me is that the minister has not talked to anybody who wants to borrow money. He has not talked to any workingmen or poor people who are going to borrow money. They do not care how it is listed; they want money and they want to know how much they will have to repay. They really do not even care how much it will cost, because if they are told it costs less over 36 months as opposed to 24 months, most of them will choose the longer period, and the difference is quite substantial. They will not go to a finance company and ask about interest rates. They are not interested in financial statements, last year's report or how much money these institutions make. They are not interested in how much they have lent, or how secure they are. These people go to finance companies and say that they want to buy a car or a trailer, that they want to take a summer vacation or buy a new stove, that they want to go on to the consumer market or, if they have sick children, to get medicine.
Working people will go into a credit office asking for a loan, and all they are concerned about is whether they are able to give a good enough story in order to get a loan. Very few of them go to a bank, and the reason is that the bank will send them immediately to see the manager. The manager will give them a big song and dance and they will not get the money they want. I once went to a finance company. The reason 1 went was that that company advertised on the radio, "Come down and see your friendly Household Finance dealer; he has money to lend you." When I needed the money, like everybody else I had that ad in the back of my mind. I went in, and I wanted the money right then. I wanted to spend the money right away. That is why I wanted to borrow it. If I had wanted to think about it for six months, I wouldn't have needed to

borrow it; I would have lost interest in whatever it was I was going to buy.
A finance company credit officer will ask where you work, how many children you have, whether you are married and how long you have been at your job, and then he will give you the money.


John Allen Fraser: Only if he finds that you are an MP.


William Arnold Peters: When I came here, members of parliament were the last people who would have any success at a financial institution. I would think they had the worst credit rating in the city of Ottawa, and probably across the country. However, years have gone by and, hopefully, our credit rating is better. It would not have mattered even if a member of parliament went to Household Finance. They probably would not have got a loan from a bank, but if they had gone to Household Finance, even they might have been able to borrow.
Interest rates were never a problem. That did not matter, and it does not matter now. The only thing that matters is whether a loan can be made and how many months it will take to pay it back. Why do interest rates not matter? I have not gone to a finance company for many years, but interest rates do not matter because people assume that the government has fixed an interest rate limit for finance companies. If people borrow more money, we get into the mortgage field and there is a different rate, but the government is going to take care of that.
What will happen under the proposal of the minister? I wonder if he ever really thought about it. A worker will go to a finance company and he will be asked whether he is married. If the answer is yes, the credit officer will write down a couple of figures. The worker will then be asked whether he has any children, and another figure will go down. He will then be asked whether he owns his own house and whether it is mortgaged, and a few more figures will be put down. He will be asked whether he has a car and how long he has been at his job, and a few more figures will go down. Then the worker will be told that he is not a good risk and that his rate will be, for example, 24 per cent.
Another fellow might come in with a different set of answers, and taking the minister's "x", "y" and "z" factors into account, his rate might be 17 per cent. So there is another price to pay for this latter applicant. Everyone who goes into a finance company and has a different set of "x", "y" and "z" factors will have a different rate, from the criminal rate right down to a rate at which even the finance company cannot borrow from the bank. The only thing the finance company will have to do is periodically declare its costs, which will have already been negotiated. It is true that a person might be able to go down the street and get a better deal, and that will mean that people might shop around. That might be a good thing. But it seems to me that we are not talking about downtown Montreal, Vancouver or Toronto. In many cases we are talking about places where there is only one financial institution. In those cases, a person may find that he is paying a different rate from his friend, and his friend is paying a different rate
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from another friend. Everybody who goes there will have a personalized rate.
The minister will make darned sure that the risk will not be higher than the return, and for this reason, as 1 see it, he will allow all kinds of rates if people want to negotiate their rates on the basis of these many factors. I think that would be a disaster. The less capable a person is of understanding the rate he is to pay, the more financial institutions will be able to charge him, and he will be charged a high rate. Those who are astute with regard to business practices will not go to finance companies in the first place. They will go to a bank. However, if people are not astute, they are poorly equipped to deal with the information the minister says he is going to provide and they will pay more. Is it not possible for us to go back to a fixed rate?
Hon. members have talked about a criminal rate. When we talk about 73 per cent, we are talking about downtown Toronto, Vancouver or Montreal where the mafia will put a person into a pair of cement shoes if they do not make their payments. That is loan-sharking. Let us not confuse loansharking with what happens in the normal course of events. The loan-sharking the minister talks about might be totally different from my understanding of that term, but to me loan-sharking is an unconscionable transaction brought about because a person cannot borrow from anywhere else and he has to pay whatever the situation demands. If necessary, he may have to sign over his life. When the general public reads about loan-sharking, they read about people who pay with their lives.


Anthony Chisholm Abbott: Oh, come on; that isn't true at all.


William Arnold Peters: That is what the general public thinks loansharking is.


Anthony Chisholm Abbott: No, it is not.


William Arnold Peters: Over the past year I have been reading about investigations in the city of Montreal into the loan-sharking practices which have been taking place there. What is loansharking in the city of Toronto? In Toronto that activity takes place on skid row and people pay with their lives or at interest rates which are sometimes 100 per cent per day. Today a person might borrow $100, and tomorrow he will have to repay $200. When you are borrowing for an emergency, payments of that kind are sometimes warranted. Companies do not borrow this way when they are a little short of cash for a contract and they need a few dollars. That is not loan-sharking as we know it, unless they are dealing with the mafia or the underworld.
I am sure the minister is not prepared to say the legislation will stop that. He has not even taken the precaution of making it mandatory that everyone who enters into any kind of loan arrangement should be licensed. These arrangements that the general public understand as loan-sharking occur in pool rooms and such places. The minister is a lawyer, and I presume he has handled not only corporation law but has acted
Protection of Borrowers and Depositors as defence counsel. If he has, he will know the kind of people the general public consider to be in the loan-sharking business and will no doubt have defended some of their victims. But maybe he has a new definition of loan-sharking, Mr. Speaker, just as he has a new definition of "reasonable interest," meaning whatever can be charged, taking the risk into consideration.
The committee should look carefully at the general problem of interest rates. I consider, as I think anyone with a protestant work ethic background would, that a 10 per cent interest rate is usury.


Ralph Goodale: That is an anti-Catholic remark.


William Arnold Peters: As a young person I was exposed to the Protestant ethic. The Roman Catholic philosophy probably has the same kind of ethic and believes that more than 10 per cent interest is thievery. Yet today there are very few house mortgages-and a house is a necessity, not a luxury-where the interest rate is not in excess of 10 per cent.
To get away from dogma, Mr. Speaker, I suppose we could think back to biblical times when Christ threw the moneylenders out of the temple. I used the Protestant ethic as an example because that is the one I was raised under; but I suppose moneylending goes back a long way. Lending money as a result of somebody else's misfortune has never been an honourable profession, but if there is to be any justification for it, then it seems to me the minister has to do a number of things. In the last election campaign the Liberals promised that moneylenders would be licensed in order to control chequebuying and loan-sharking. I suppose loan-sharking, in common terminology, extends to that dangerous level of the criminal element of our society where people go for money they cannot get elsewhere. If I were to put an interest rate on loan-sharking, I would certainly put 10 per cent in that category; but apparently the minister does not. In the last election campaign the Liberals also indicated that by the end of 1974 they would increase the number of consumer storefront offices to 20. I do not know whether they have done that, but I doubt it very much.
Perhaps we could learn something from the election campaign in the United States. Even in that great, free enterprise empire they are talking about trying to pay their way. Mr. Carter has said it should be mandatory that government expenditures be justified for programs included in the budget.


Ralph Goodale: What do you think we are doing?


William Arnold Peters: We are not doing it in this bill. We do not even indicate to people that it may be worth their while to pay for things out of the money they have, rather than the money they may earn tomorrow. The Minister of State for Urban Affairs (Mr. Danson) advanced a very good idea, as a private member, that many of us supported, for a card called "Cashex". He suggested that if you took this card to a store when you made a purchase, you should get a premium for paying cash. Unfortunately, in these days many stores are not equipped to deal with cash and only have credit card facilities.

November 2, 1976
Protection of Borrowers and Depositors
I think the Minister of Consumer and Corporate Affairs (Mr. Abbott) has an obligation to set up an agency that will inform the people of the advantages of paying cash and will advise individuals how to handle their income in the best way possible. Through advertising the consumer is encouraged to go out and buy, buy, buy. The agency would be able to advise people of the cost of borrowing, and in some cases might even be able to talk them out of making purchases.
I spoke earlier about the role of the banks, Mr. Speaker. When you apply to a bank for a loan, first of all the accountant asks if you have any money in the bank. 1 can never understand why you would borrow money if you already have some in the bank. At one time I wanted to buy a new car. I had a $5,000 bond in the bank, so I cashed it. I did not spend all of it on the car. Later I found that it cost me $1,500 or $2,000 to cash that bond, whereas if I had borrowed the money I would have come out ahead; the interest rate would have offset the income tax, but nobody explained that to me. A consumer credit advisory bureau would explain to people the best way of handling their money. I do not think the average person has this knowledge.
If the minister is honestly interested in this problem, he should spend a few days talking to the working poor of the country and to the middle income people who are earning good salaries. I think the very poor should not be allowed to borrow money under any circumstances: we should be giving them money instead of asking them to borrow it at interest rates which are unconscionable. If someone is living on welfare or drawing an allowance under one of the federal or provincial programs, it is not always their fault if they have to borrow money from a finance company; it is ours. In my opinion they should not be allowed to borrow. If they can establish the need, there should be an agency to advise them.
To be fair, some agencies and family services in Ontario will help with roof repairs and heating repairs. If someone living on welfare needs money for this sort of thing, it is made available in addition to welfare. That is how it should be handled. You should not ask a person to go to IAC, Household Finance or the friendly finance company for money at high interest, because such borrowing acts like a snowball; pretty soon such people are deeper and deeper in trouble until they must use the bankruptcy structure which this government recently provided.
Incidentally, I heard a story about a young chap who borrowed money from a finance company to go into bankruptcy. He went to a finance company and said, "Lend me $300 to enable me to go bankrupt." The question is, why should a finance company lend him money if he intends to go bankrupt a couple of days later? But the company did lend it. I will tell you why: the guy borrowing the money said, "I will pay you back." This story highlights something very interesting. In the high income brackets of this country you will find cheats of all kinds, those who cheat on a huge scale, those who cheat on income tax, etc. The little guy at the bottom of the scale who works in the mine or factory does not cheat on anything. He

has no expense account; he cannot write anything off against income tax. That does not apply to people in the higher income brackets who can even write off their meals. You see them all over Ottawa, eating in restaurants and writing their meals off against income tax. But you and I, Mr. Speaker, as members of parliament are not quite in that position. We are more like the wage earner; we pay for our meals and do not write them off.


An hon. Member:: But the price is right.


William Arnold Peters: Not even the minister has that privilege, I think.


Mr. Beatty:: Pretty soon people will be feeling sorry for us.


William Arnold Peters: Not really. The point is that in so many ways this country's poor and those living on salaries are in much the same position: they do not cheat because the system does not allow it. I suppose they might cheat if it were possible. Members of parliament are almost in that category unless they happen to own a business or are involved in some outside interest. They can only claim exemptions for their wives, children, etc.: they claim the normal deductions.


Mr. Gilbert:: Unless they sell aircraft.


William Arnold Peters: Some, with businesses, are in a somewhat different position. It seems to me that the banks have looked after themselves very well. A few years ago the banks claimed that the 6 per cent interest rate was too low, but in the last four or five years their profits have been so large that their stocks have probably been the most attractive investments available. Where did the banks acquire this extra money? They got it from borrowers. As interest rates rose, they lent money at between 14 per cent and 18 per cent and did very well.
The finance companies did well, too. Banks own, directly, four or five finance companies and lend them money at 10 per cent or 11 per cent interest, money which the finance companies will, in turn, lend at up to 28 per cent interest per annum. I am told that such rates are comparatively low; sometimes money is lent at greater rates. I have heard people talk of finance companies lending at between 11 per cent and 24 per cent. Frankly, I do not think any finance company in this country lends money at such low rates. Most of them borrow money from banks at about 9 per cent or whatever the prime rate is. The record of the financial transactions of some companies is so bad that they can only borrow money at 11 per cent or 12 per cent interest. That matter was not taken into consideration in this bill.
It seems to me that if the minister is saying that interest rates should be in keeping with the risk, he should look at the other side of the coin. Should not the rate bear some relation to how cheaply trust companies, finance companies and other lending institutions get their money? If they borrow cheaply, why can they not lend cheaply? I suppose the minister says that the lender has the right to a fair return. But if he gets his money cheaply, he will make more than a fair return even if one uses the minister's criteria. It is well known that the
November 2, 1976

repayment record of the poor and the low wage earners of this country is good. The man who borrowed $300 in order to go bankrupt repaid the loan although he was under no legal obligation.
An. hon. Member: What about the other guy?


William Arnold Peters: To heck with the other guy; the man went into bankruptcy to get away from him. If you push a guy to the wall, he will go into bankruptcy.


An hon. Member:: It is dishonest.


William Arnold Peters: Not at all. How many of the hon. member's friends in business have gone bankrupt two or three times and made $1 million?


Mr. Parent:: My friends?


William Arnold Peters: I assume that some hon. members of this House are on the side of the financial institutions. If a person cannot make it, so to speak he has recourse to bankruptcy. On the other hand, the little guy who borrowed $300 repaid his loan with interest. It has been suggested that we should act in this field as we acted with respect to farm credit, small business loans, student loans and other areas coming under federal legislation. In other words, we ought to guarantee the risk by insurance. The cost of the scheme could be borne by the borrower, who might pay an extra 1 per cent. I believe that for farm credit the borrower pays an additional 1 per cent for supervision and insurance. Under other legislation interest is calculated in much the same manner. It seems to me that with regard to loans under $5,000 we could add an additional 1 per cent to the going interest charged of, say, 17 per cent for administration, and guarantee such loans.
There would be little risk and little expense, since the record shows that there has been default in only 1.5 per cent of all loans made to low income people by finance and trust companies. By doing this we could make more money available. If hon. members believe in the free enterprise market system and in money circulating, by adopting the scheme suggested they could make money circulate. What is more, money would be available at the lowest possible cost to borrowers. Money really has no value except in what it does. It provides a service, as my friend told me a few minutes ago. It does not grow; you cannot plant it. It provides a service, and that is all. It seems to me that people who live off lending money are really not providing a service. They are living off the misery of others.
If the government really wants to help those with very low incomes, they should bring in an insurance program with a fixed interest rate. This would be fair to both the borrower and the lender, and at the same time it would be as fair as possible to those in the most unfortunate position in our economic structure, namely, the poor. I am sure this kind of interest rate has been initiated by the finance companies. They have risk insurance. All I ask is that the interest rate reflect the ability of the finance companies to recover. In order that we will know
Protection of Borrowers and Depositors what that recovery will be, we should set an insurance rate for a certain loan level and make that available to the general public.
I next want to deal with the matter of taking a finance company to court. Big deal! A person is not going to hire a lawyer so that he can sue a finance company because he feels the interest is too high. He would have to borrow from another finance company in order to do that. It may cost him $1,000. The person, already having indicated that he has bad judgment, will probably end up with a bum lawyer. The minister says that rather than go that route, he can let the finance company sue him. Such a person may not have steady employment. Because he does not have much training, he may have a hard time getting a job in the first place. What would happen to his credit rating if he were sued by a finance company? He would never again be able to get credit, so he likely would not follow that route either. If we are going to protect people against money lenders, why ask someone else to do the protecting? Why ask someone to go through the courts? Such a person probably does not have enough money to get a divorce, let alone sue a finance company. We are talking about people the minister does not know anything about. We are talking about half the people of this nation who were not born with a silver spoon in their mouth.


John Allen Fraser: He probably did not have enough money to get married in the first place.


William Arnold Peters: The hon. member is correct. In Ontario now it does not matter whether you are married or unmarried; it does not make any difference.
Guaranteed insurance could be provided at a reasonable price. If necessary, the government could carry it. If a loan is insured, the borrower will repay it and interest rates will be kept at a fixed level. There has been talk about small business loans. Why were they not successful? Because the banks would not get involved in them. That may happen with this program if interest rates are too low. I have one other point I wish to make. It is with regard to people cashing cheques at a discount. If there is a postal strike, the government either holds up cheques or sends them out early.


The Acting Speaker (Mr. Ethier):: Order, please. I regret having to interrupt the hon. member, but his time has expired. He may continue only with unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


William Arnold Peters: The government may send out early family allowance cheques, DVA allowances or DVA pensions. A person may be totally dependent on the cheque for his existence. It is only enough for him to get by without any luxuries for a month. If such a person is allowed to cash his cheque early, the next month will be impossible; he will have no money.
I strongly urge the minister to not legalize that practice even if he believes it will eliminate abuses that have occurred in the
November 2, 1976

Protection of Borrowers and Depositors
past. Maintenance cheques should cover only one month. If they happen to arrive a little early one month, they should not be able to be cashed early, so that people will have the maintenance in the month for which it was intended. I strongly urge the minister not to proceed with that particular clause.
I thank hon. members of the House for the extra few minutes I have been permitted.


John Allen Fraser: Mr. Speaker, it is a pleasure to take part in this debate. I want to say, as have other speakers of my party, that we support the principles of this bill and will co-operate with the minister in moving it through the House of Commons and into committee. We will, of course, have a number of questions to ask when it gets into committee. Hopefully, with the co-operation of other members, we will be able to make some improvements.
Having listened to all the speeches so far in this debate, I think it is important that we remember-and it is obvious from looking at it-that this bill was not brought into the House just to go after so-called loan sharks or the hard-core criminal element which deals in lending money to certain people who as some hon. members said, must pay back at 100 per cent or more interest or, in extreme cases, be killed or, in less extreme cases, be beaten up. It is in fairness to the vast majority of honest people in the financial institutions of this country that we say that now.
It is very easy, especially if you listen to what some hon. members have said and what sometimes appears in the media, to come to the conclusion that this bill is designed to wipe out all criminal activity in this country. Clearly, it is not designed to do that. As my friend, the hon. member for Timiskaming (Mr. Peters), said a few minutes ago, it will not do that. Of course it will not.
What is this bill trying to do? No one can expect it to wipe out the hard-core criminal element. It may be helpful in at least making it more difficult for the quasi-criminal loan outlet which is using laundered money to operate rapaciously or unfairly. However, what it is really aimed at is establishing a more reasonable environment within which people in lower income levels or in need of large loans can borrow money with more certainty, knowing the deal they are entering into. That is what this bill is all about.
Some hon. members have pointed out in quite a compelling way that there are problems when unsophisticated borrowers go to finance companies. They have referred to problems when people are in desperate straits through no fault of their own and have to get money very quickly. It is no good telling them they are in no position to borrow. They are in no position to do anything but borrow, unless they steal. That is the dilemma they are in. These people will need money from time to time. There will always be people to whom the wisest advice you' could give would be, "Don't borrow any money." They are often the people who desperately need money, and they have to know what the deal is.

Some speakers before me, including the last speaker, suggested that the bill should include a vast counselling service so that everybody who contemplates taking out a loan could receive advice on whether they should be taking such a step and, if so, what would be the best kind of loan to take out. It would be nice if we had the resources in this country to give that kind of counselling to everyone who is likely to borrow. But there are practical difficulties as well as philosophic ones in the way of such a proposal.
The practical difficulties are extraordinary when one considers that in 1950 the amount of consumer credit outstanding was $1.2 billion, representing 10.2 per cent of total personal expenditure in that year, and that by the end of 1974 the figure had risen to $20.6 billion, representing 25.8 per cent of the year's consumer spending. To seriously consider that the bill before us can make provision for a counselling service for the benefit of anybody and everybody who wants to get a loan in this country is, in my view, being unrealistic. I am not at all sure that from a philosophical point of view it is wise to take the attitude that people cannot make their own decisions about their affairs. Moreover, I am not at all sure the people concerned would thank us one bit if we set up an expensive bureaucracy to advise them how to manage their personal financial transactions.
I want to emphasize that the bill is designed to create an atmosphere of fairness and certainty in connection with legitimate dealings within the financial market. It is not designed to wipe out the hard-core criminal or even to wipe out the quasi-criminal. It is important to remember that many people who borrow money do not borrow it from financial institutions. They borrow it from each other. A newly-married couple borrows money from parents-in-law or from relatives. Young people borrow from older friends, and friends borrow from each other.
A large number of people who may in the course of a lifetime make only one or two loans are, nonetheless, within the contemplation of the bill before us. I bring this to the attention of the House so that we might avoid the danger of slipping into the assumption that anybody who makes a loan is in the position of being a powerful financial institution knowing exactly what the ground rules are.
I am glad to see the minister in the House, as he has been throughout most of the debate. I say to him, through you, Mr. Speaker, that the measure is a complex one. We understand the reason for its complexity; it deals with a complex subject. But as I was saying, it will govern lenders who are by no means in the position of being powerful financial institutions in receipt of expert advice. It applies to loans made between families or friends, which form part of the financial arrangements made by a great many people in this country. This being the case, we must look carefully at the details of these provisions to ensure that in seeking to create a climate of greater fairness and certainty we do not impose burdens on innocent lenders or upon innocent borrowers which we did not intend to impose.
November 2, 1976

I would ask the minister, therefore, to make a note that in committee we ought to look carefully to make sure that the penalty clauses will not rebound against people who, when making loans to their sons-in-law or to their nephews, say, fail to set out all the terms of the loan as required under the legislation. Having been a lawyer myself, and knowing that lawyers have never been the most popular people in the community-we have always come just after that most unpopular person, the moneylender-


An hon. Member:: Or politician.


An hon. Member:: Speak for yourself.


John Allen Fraser: I would point out to some of my colleagues that they would find themselves in considerable difficulty if they were unable to find any money to borrow when they needed it.


Some hon. Members:: Five o'clock.



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
[ Translation]

The Acting Speaker (Mr. Ethier):: Order, please. It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Winnipeg North Centre (Mr. Knowles)-Statutory Holidays-Possibility of legislation establishing Heritage Day; the hon. member for Vancouver South (Mr. Fraser)-Airports-Vancouver International- Suggested environmental studies in connection with proposed third runway-Government position; the hon. member for Humber-St.-George's-St. Barbe (Mr. Marshall)-Canadian National Railways-Reduction of staff and service in Newfoundland-Request for investigation.



PRIVATE MEMBERS' PUBLIC BILLS


Mr. John Reynolds (Burnaby-Richmond-Delta) moved: that Bill C-204, to amend the Canada Elections Act (permanent voters' list), be read the second time and referred to the Standing Committee on Privileges and Elections.
He said: Mr. Speaker, it is a pleasure to be here this afternoon speaking on this problem. I am somewhat out of breath: we were sitting in the committee on justice this after-
Permanent Voters' List
noon and I was still questioning Mr. Terry at five minutes to five. I shall be very quick. I have notes for a short speech about the benefits which, hopefully, would flow from this bill and I trust hon. members opposite will agree to let it go to committee.
The preparation of a voters' list is one of the most important stages in a general election. The fair and comprehensive compilation of such a list is one aspect of electoral reform to which a great deal of time has been devoted, yet this remains an area of differing opinions. To adequately answer the question as to which system has the least drawbacks and most advantages, we should look at this problem within the framework of some criteria. The first and foremost criterion is the inclusion of the greatest number of names of eligible voters and, conversely, of the least possible number of eneligible voters. The second criterion is the relative cost of preparing the list of voters.
My bill, Mr. Speaker, calls for a continuous, permanent list in which the initiative for registration should lie with the individual. This is not to say that the Crown should not exercise some influence. As is the experience in many American states, unless there is some degree of compulsion or scheme of intensive publicity campaigns, reliance on voter initiative is unlikely to produce a very complete list. What we would have is a combination of systems placing the primary responsibility on the voters to register themselves, and also introducing a considerable measure of follow-up action and publicity by election officials to ensure that the greatest possible number of voters do in fact exercise their right. Two examples of this system would be New Zealand and Great Britain.
It is my feeling that Canadian election campaigns are unduly prolonged, not so much to allow the campaign strategists to exercise their talents but more to allow for an election list to be compiled as accurately as possible in a given time. Surely, Mr. Speaker, a permanent, continuous list would alleviate some of the cumbersome and time-consuming qualities our system now exhibits. A permanent, continuous list would indeed be fair for all parties and allow campaign organizers to have a copy of a list of voters at any given time and allow more time for workers and supporters to canvass prospective voters.
In a study in 1968, the Canadian representation commissioner found that:
The system of continuous electoral rolls currently in use in the Commonwealth of Australia, including the method of compulsory registration on the part of the electors, can be adapted for use in federal elections in Canada to reduce the time required for the holding of elections and to provide improved facilities for voting by electors-
There have been arguments, Mr. Speaker, that to effectively and adequately institute a continuous, permanent voters' list involves the outlay of a sufficient amount of money. Firstly, this conclusion has been arrived at not out of practice but out of guesswork. Not since 1935, by way of the Dominion Franchise Act of 1934, have we tried a permanent list. By the chief

November 2, 1976
Permanent Voters' List
electoral officer's own words, the permanent list was not that disfunctional. Many feel that in order to set up a continuous, permanent voters' list an electoral office must be set up in each constituency. I do not think this is necessary, and in order to cut down the expenses one central office could surely handle compilation of a list that effectively puts the onus on the voter to register himself. Naturally, an annual update of the list would have to occur and then review officers could be sent out to the constituencies to update the list, making deletions and noting changes.
One way, Mr. Speaker, of facilitating the actual registration voters could be by way of incorporating a section on our personal income tax forms. The names and related documentation could easily be handled by the revenue department's computer with considerable ease, thus alleviating some of the paperwork, added confusion and extra expenditures. I am told the cost of conducting the enumeration in the last federal election in 1974 cost $29 million. 1 think one can question not only the cost but the accuracy of the enumeration and the number of individuals disenfranchised in each election because of haphazard enumeration. A permanent list with yearly updates by way of constituency reviews can surely incorporate the greatest number of eligible voters at any given time. Surely this is what we should be striving for in electoral reform, Mr. Speaker.
Not since 1938, under the Dominion Elections Act, has the process of registering voters changed. I am not saying the permanent list is the answer to all the problems, but 1 do think this bill should be referred to committee for study. Perhaps there we can carefully and accurately ascertain which system best suits our needs. I do not think it is fair to dismiss the permanent voters' list as expensive. It does hold some redeeming value in the enumerating process, and I think with a carefully constructed combination of primary responsibility on the voter, and exact follow-up action on a yearly basis, we can have a system that will be envied.
In conclusion, Mr. Speaker, I would like to make reference to a comparison of the percentage of the total voting age populations which were registered on official voters' lists. The most recent figures I could obtain are from the 1966 census, but I think they will nonetheless explain my point. At that time the voting age was 21 years. The number of voting age population, according to the 1966 census, was 11,260,202. The number of electors on voters' lists for that time was 10,274,904, a difference of 985,298, all of whom were disenfranchised. I am well aware that those institutionalized or those classified as transients sometimes lose their vote, but a figure close to one million causes me some concern. I have to ask myself how thoroughly our present enumeration is being carried out, and for that reason alone I think this bill should be referred to committee.
Finally, I should just like to say this, Mr. Speaker. In getting the bill into committee, one aspect we will have to examine, and one of the matters we have talked about in the privileges and elections committee last session, is the length of time of elections. We are managing to knock a few days off at
[Mr. Reynolds.)
times, but the election now going on in the province of Quebec is going to last 28 days. I think that should be the maximum time. A month is more time than we need for an election in the electoral process of this country.
The cost of keeping a permanent voters' list may be more than an enumeration every two, three or four years whenever an election is called. The cost saved to the public purse in cutting down the length of an election would, however, be tremendous. It would also mean that parliament would not have to be in recess for such a long time. Therefore, I hope hon. members on the other side will see fit to send this bill to committee. We did not come up with a final answer last session, but if the bill does go back to committee we may be able to come up with a solution this time which will save the voters of this country another long election, whenever it may be.


Gilbert Parent: Mr. Speaker, I agree with the criteria set out by the hon. member for Burnaby-Richmond-Delta (Mr. Reynolds). We should evaluate the various systems of preparing electoral rolls in existence in Canada. The two criteria which should be used to evaluate the systems, or which could be used in the registration procedures, would be as follows. The first criterion is the inclusion of the greatest number of names eligible, and the least possible number of ineligible names. The second criterion, of course, is the relative cost of preparing the list of voters.
Always keep in mind, Mr. Speaker, that even with the most perfect list of voters that we could have, it still would not guarantee a good voter turnout. This is the experience in the United States today, where they estimate they might get 50 per cent of the voters out. I am told they do have obligatory and continual permanent voting, if you will, in many of the states, if not all of them, though I do not know whether that is the federal fact. I think we should surely take this into consideration in our discussion of a permanent voters' list and its place in Canadian society.

Now, Mr. Speaker, let us first examine the features of the different voter registration systems. Voter registration has been accepted in western democratic countries as a protection against fraud. It makes possible advance identification of such voters who are really entitled to cast their ballots so that we may be sure that only they will exercise their rights to vote. With this in mind, democratic countries have enacted various legislation providing for voter registration.

Voter registration systems were gradually adopted in most countries in the latter half of the nineteenth century and arose out of a general need to bring administrative order to the election process. Some countries created systems that placed responsibility for registration on individual voters, but Canada made public authority, not the individual, legally responsible for the burden of voter registration. This distiction between government initiated systems and those which depend on the
November 2, 1976

personal initiative of voters is a fundamental dimension that can be used to characterize voter registration systems.
Let us consider two kinds of government-initiated registration systems. In countries where there is a register of internal migration, a list of eligible voters is generated from information recorded in a general population register. In West Germany, for example, the state maintains a continuous record of important demographic events for each citizen. This record includes birth, death, marriage, divorce and migration. It is the recording of this last event, migration, that makes possible the compilation of an extremely accurate electoral register. Each German citizen must register changes of residence with the local authorities. There is a fine for non-compliance. If the move is between cities, the citizen must notify the officials in both places. All of this information is recorded in a central municipal office. An electoral official examines each new registration to see that that registrant is qualified to vote. If so, the name and credentials are placed in a special file of qualified voters. At the time of an election, the file is used to print lists of qualified voters. Similar systems of automatic registration are used in Sweden and in Switzerland.
I do not know if the Canadian people as a whole would readily accept this kind of documentation of their citizens travelling between cities. I would remind my colleagues that in Canada you can go from coast to coast without registering, so long as you are a citizen, and even if you are not, no one will bother you. 1 do not know if it is in the nature of a Canadian citizen to accept this kind of documentation with the purpose of finding out where you are and where you are going, ail in the name of voter registration, in the name of controlling the movement of citizens. Perhaps it is acceptable in Europe, but I suggest that it would not be totally acceptable to those of us who live in Canada.
[ Translation]
The second registration formula initiated by the government is a kind of census carried out by a government agency. This is the case in England and in Canada where there is no mandatory registration and no internal migration. In England a fresh list of electors is drawn every year for each Federal constituency. The municipal clerk sends application forms through the mail to each household in the constituency. The head of the household has the responsibility under the law to list all qualified voters residing with him and mail back the list to the municipal clerk.

If the response to this direct mail canvass is not satisfactory, the clerk sends door-to-door canvassers to those areas with low response rates. The list developed through the canvass is used for any and all elections held during the year following the end of the canvass and the official closing of the next list on February 15 of the following year. In Canada, a new list of qualified voters is developed prior to each federal election. A complete door-to-door canvass is made in urban areas, which are defined by law as cities of 5,000 or more. In rural areas the
Permanent Voters' List
lists are made up by registration officials through a door-to-door canvass or other inquiries.
Government-initiated registration systems can be further distinguished by their effectiveness in registering the eligible electorate. I note that the hon. member in his remarks to us in the House referred to the success of a permanent list. I think he should be made aware of the results of the permanent lists which are used in England. Systems of automatic registration obviously are most effective, depending only on the accuracy of the population register. In countries with a compulsory registration system, the electoral list should be virtually a complete accounting of the potential by qualified electorate, minus people in transit at the time of an election. The canvassing techniques used in Canada and England also produce lists which accurately mirror the potential electorate. The Chief Electoral Officer of Canada, who supervises the conduct of federal elections, estimates that for the 1972 election approximately 90 per cent of all eligible voters were registered.
What about the British lists? These are permanent voters' lists. How do they compare with the system currently in use in Canada? We should look at the two so as to compare them. First of all, the British lists are a little less accurate, depending on when an election is held. In Canada, registration is conducted only before each election and the lists are no more than Vh weeks old by election day. In Britain, registration is done annually and the lists are closed on February 15 of each year. No new registrations are added after the closing date, but people who move after the close of the lists may vote from their former residence in parliamentary elections. This means that elections held toward the end of the 12-month period in which the electoral register is in effect will be conducted under old, and thus more inaccurate, list. An election held in December, for example, would be conducted with a list 9lA months old. Nonetheless, the electoral register still accurately lists approximately 85 per cent of the people living in a constituency even at the end of its one-year life. I suggest that this is nowhere near the 98 per cent which we have currently in Canada.
A study of the accuracy of the 1966 register in England produced the following findings. On the qualifying date, October 10, 1965, they were able to list 96 per cent of all the people who were eligible to vote, not 98 per cent but 96 per cent to begin with. When the register came into force on February 16, 1966, the list was down to an accuracy of 93 per cent. Halfway through the life of the register in August, 1966, it was down to 89 per cent and, as I mentioned before, at the end of the life of the register on February 15, 1967, it was down to 85 per cent. I suggest that this is not acceptable when we can get more up-to-date lists.
Registration systems in which the burden for initiating registration lies with the individual citizen appear to be limited to the United States, as I mentioned earlier, to the province of British Columbia where the hon. member for Burnaby-Rich-mond-Delta comes from, to France, and to a few Latin American countries.

November 2, 1976
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Who is to be entrusted with the gathering of all this information, always keeping in mind that here in Canada at least we have government-initiated programs where the government is the authority which gets this information, not the individual? We know that the returning officers appoint two enumerators in each urban polling division. These enumerators are chosen from lists supplied by the two candidates who have received the highest number of votes in the preceding election. This bipartisan feature is intended to serve as a check against attempts to falsify the registration lists. The enumerators are paid a flat fee of $35, plus an addition of ten cents for each name added to the list. Most enumerators earn between $50 and $60.
As to the method of gathering information, the enumerators must visit each dwelling place in the polling division. If there is no one at home on their first visit, they must leave a card stating the date and time they will call again. If there are two visits, one must occur between 9 a.m. and 6 p.m. and the other between 7 p.m. and 10 p.m. For each person enumerated they must leave a form notifying the individual that he or she will be included on the list of eligible voters.
So here we have a counter check by which to make sure that the people who are directly involved in the voting process will know not only that they are eligible but that they are on the list, so that on election day they will be able to take part in the democratic process. In Canada the information obtained by the enumerators includes only name, address and occupation, I would point out, again, that at least to me this information about internal migration in our country is just not acceptable. No signature is obtained from the elector, nor can enumerators demand identification such as a driver's licence, birth certificate and the like.
It is possible for aliens such as United States citizens or citizens from any other country living in Canada to appear on the enumerator's list. They are not required to obtain information directly from each eligible voter but many obtain it from other sources such as members of the family. The printed list sent to candidates and voters serves a number of purposes. It is primarily a device for ensuring accuracy. People listed incorrectly can have corrections made at a later revising period. At the same time, those voters such as resident aliens listed improperly may be challenged, and those left off the list may be added.
Since the list is so widely available and a common object of public knowledge, it is believed there is little opportunity for fraudulent registrations. The printed lists also serve an important information function, noting the times and locations for revising the lists, procedures for challenges and corrections, information about advance polling and the location of polling places. The hon. member for Burnaby-Richmond-Delta mentioned that in Canada a new list is prepared for each federal election. Indeed it is. The lists are used for that election only and then discarded. This system has been in use since 1920

with the exception of the 1935 general election when permanent lists were used.
This was repealed in 1938, allegedly because of the excessive cost and the inaccuracy of the voters' lists obtained. I refer to the criteria, once again, which the hon. member has raised. Let us evaluate the various systems for preparing electoral rolls in existence in Canada. Two criteria, as was mentioned, would be used to evaluate the registration procedures. The first criterion is the inclusion of the greatest number of names of eligible voters, and the least possible number of the ineligible.
The second criterion is the relative cost of preparing the list of voters. From the first criterion, which is that of the quantity of names of eligible votes included, and the accuracy of the list, it seems a system of continuous lists with compulsory registration by voters is the best system. Yet the only continuous list in existence in Canada, which is the British Columbia system, does not require compulsory registration. Experience in many American states indicates that unless there is some degree of compulsion, or a scheme of intensive publicity campaigns, reliance on voter initiative is unlikely to produce a very complete list.
Now I should like to quote from the same source as the hon. member. In his report on Methods of Registration of Electors and Absentee Voting (1968), the representation commissioner of Canada commented on the problems of a system employing voluntary registration as the sole method of updating the rolls. He said:
Because of the general apathy with which electors view registration, few avail themselves of the opportunity to register or correct existing registration either by personal attendance before, or by mailing the prescribed forms to, a registrar, in the period between elections.
When a general election is imminent and during the short period of time between the date an election is called and polling day, there is an impetus for some electors to register. However, such a last minute rush tends to cause the system to break down under its own weight. It is impossible to deal adequately with a large number of new registrations at a date so close to polling day.
It is too soon to make a judgment on the system of a permanent list drawn up by enumeration established by Quebec and Prince Edward Island. Generally speaking, the free election enumeration procedure in effect in Canada and in most provinces has been satisfactory. This system produces what is surely the most up-to-date list of voters possible. The main source of error on the list is not so much the omission of the eligible as the inclusion of the ineligible, especially the non-citizens.
With regard to the second criterion, which is that of the cost of making the lists, it is the temporary list system that is the least costly. If I may quote the figures of the hon. member, he said that the cost in 1974 was $29 million. 1 ask myself and I ask you, Mr. Speaker, and other members of this House what would be the cost of permanent, ongoing lists if they were more than the $29 million which has been quoted?


The Acting Speaker (Mr. Ethier):: I regret to interrupt the hon. member, but the time allotted to him has expired. He may continue if there is unanimous consent.


Some hon. Members:: Agreed.
November 2, 1976


Gilbert Parent: The cost of the continuous list system with compulsory registration has been assessed by the representation commissioner in his report as being very high. He concludes:
However, it is my belief that the adoption of such a system would prove to be very costly. The setting up of a permanent office in each electoral district, the recruitment of a great many permanent and casual employees, and an annual house to house canvass by review officers in order to purge and up date the existing lists of electors would be the major items of expense.
Likewise, the system of an annual enumeration in Quebec is very costly. The cost in Quebec is estimated to be $3 million a year. I must hasten to point out that lists of electors in Quebec are placed at the disposal of school boards and municipalities for electoral purposes throughout the province. This reduces the cost of elections for these institutions. The list is also used for drawing up jury lists. In conclusion, I ask what the cost will be and, indeed, how much more effective, if at all, permanent voters' lists will be.


Stanley Howard Knowles: Mr. Speaker, in spite of the attempt of the hon. member for St. Catharines (Mr. Parent) to demolish this bill, I still rise to support it. Indeed, as I was listening to the hon. member, I was wondering what he would do with that speech if the government he supports were to turn around and bring in a permanent voters' list.


Gilbert Parent: I'd revise it.


Some hon. Members:: Hear, hear!


Stanley Howard Knowles: That is one of the most honest interjections 1 have ever heard from the government side of the House.


Gilbert Parent: I didn't say how; I just said I would.


Stanley Howard Knowles: He is right. He would either have to revise it, or the words he would have to eat would give him indigestion from head to toe!
I commend the hon. member for Burnaby-Richmond-Delta (Mr. Reynolds) for bringing in this bill and also for addressing himself to what 1 think is the only serious question which applies to it, namely, the question of cost. 1 do not think there is any doubt that it would be a costly proposition to have a permanent voters' list, although as the hon. member pointed out, if it could result in election campaigns being much shorter than they are now, then the amount of money we could save, not just from the public purse but across the board, would be tremendous.
Let me get back to the hon. member for St. Catharines. He is a young member and a young man, but he is a debater of the old school. The thing I enjoyed was the way he took the simple request of the hon. member for Burnaby-Richmond-Delta that there be a permanent voters' list and developed it into almost a Nazi type of registration of people with respect to everything they are going to do. He had my friend's permanent voters' list completely wiping out freedom of movement and all the other
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freedoms we enjoy in Canada. It was really tremendous. As a debating effort it would sound tremendous in any high school debate on this subject.


Some hon. Members:: Hear, hear!


Ralph Goodale: That is what the Tories did to Bill C-83.


Stanley Howard Knowles: However, we are not talking about a system of limiting people's movement from one part of the country to the other. We are not talking about a registration of everything which goes on in the private lives of our citizens. We are talking about one thing only, a permanent voters' list, so that it can be more correct than the lists which are made up during election periods and so that an election campaign can be conducted in a much shorter period than is now the case.
I think the arguments are all in favour of it, and if one examines the studies of the matter which have been made it will be found that in principle those studies come down on the side of a permanent voters' list, the only problem being cost. There are many things in this country which are costly, but we decide that we want them and that they are worth the cost. I think it would be worth a few extra dollars to have a permanent voters' list, and I hope, despite the tradition around here as to what happens to private members' bills, that the subject matter of this one might yet get to the committee. Toward that end I hereby abbreviate my remarks and indicate my support for the bill.


Some hon. Members:: Hear, hear!


Jacques Lavoie: Mr. Speaker, first of all I would like to make a remark before going any further in this speech since the hon. member for St. Catharines (Mr. Parent) mentioned that it would cost too much. I would simply like to point out to him that this government is spending astronomical amounts every day to deport large numbers of immigrants whom we do not want to keep here. So when talking about the cost, one should perhaps check all departments.
Coming back to the permanent voters list, Mr. Speaker, may I first say that 1 am doubly happy to support my colleague because in 1974 1 had indeed prepared a rather comprehensive paper advocating the establishment of such a list. First it would allow a lot of people to vote, particularly when an election takes place during the summer-for example, on July 8, 1974. How many people were deprived of their right to vote simply because they were away on holiday when all of a sudden the election was called.
The enumeration and the revision take place, and people are deprived of their basic right. It is not a matter of telling someone that he has to go and vote; but for the one who wants to vote and has his right taken away from him in that manner there comes a time when we have to make up our minds to find the necessary means to allow those people to go cast their ballot. There are many other things in such system that could result in other people being able to vote in their place.

November 2, 1976
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In any case, Mr. Speaker, I do not want to dwell on the subject. I hope the House can at least allow this bill to go to the appropriate committee. 1 want to assure my colleagues on both sides of the House if they want I will send them all the documentation to know how a permanent voters' list could be put together in this country. I have it in both official languages. I will be pleased to have copies made of it and distributed.
I remember the case of a lady of almost 90 years of age;- not at the time of the 1975 by-elections because at that time those things did not happen-she cried because her name had been left out in the list when the enumerator had gone around. When the list was revised and the error was noticed, it was too late to do anything about it. There again, there have been many cases of injustice.
There is a form bearing No. 7 and entitled "Enumerators' Notice to Elector". A candidate never knows how many of those forms are in the possession of the returning officer. The social insurance number is not even indicated on those forms. How can there be any control? Not that I want to cast any doubt on the integrity of the returning officers, but the fact remains that there are always a few dishonest people who manage to get those documents and make counterfeits. I can assure you that there are many ways to get votes and win an election dishonestly.
A permanent voters' list would, finally and once and for all, enable us to have honest elections in Canada. And, 1 am convinced of it, when my colleagues read the document I will send them, they will see that the truth exists and that facts prove it.
Of course, when we talk about a permanent list, in my opinion and according to the working paper that I have here, it is out of the question to have a yearly registration. It is also out of the question to change everything completely. Certain people do not want to register because they do not want to be checked upon, like the hon. member for St. Catharines (Mr. Parent) said so well. Of course, they are not being checked upon. If you move and go from one province to another, your health insurance card and other proofs of identity follow you.
I think that we must eliminate this fear factor. These papers could easily include a voter card. I have heard people talk for many years. I have heard so-called experts talk about voter cards and permanent lists, but no sincere person ever dared submit something concrete. I am not saying that it is perfect. I am not saying that it is 100 per cent. But if it can help my colleagues, we should at least accept that this bill be referred to the appropriate authority, and then, in the light of suggestions from all sides of the House and of this working paper, Parliament would be able to decide whether we should adopt a permanent voters list in Canada and how it should be done. It is important to know this. But for the moment, it is important to know whether the House will at least accept to study the bill submitted by my colleague. I shall come back to this point at a later date if the bill reaches second reading, and I hope it will.


Mr. Jack Pearsall (Coast Chilcotin):: Mr. Speaker, I have listened with mixed feelings to the speeches this evening on a subject in which I have been involved for many, many years and I should like to comment on some of the remarks that have been made. I hope that I can straighten out a few facts as well.
It is ten years since I was first summoned to Ottawa and during my time here parliament appointed me returning officer for the riding I now represent.


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


Albert John (Jack) Pearsall: Between 1966 and 1972 I participated in two federal elections as returning officer for that riding. During my training course one of the questions I put to the Chief Electoral Officer was on whether there had been any discussion about a permanent voters' list. He replied that it had been raised many times that a number of private bills had been introduced, and died on the order paper. I have been given to understand that the hon. member for Winnipeg North Centre (Mr. Knowles) asked the same question on his first day in the House and perhaps he could confirm that.


Stanley Howard Knowles: I did a long time ago, but that was not my first question. My first question was about unemployment.


Albert John (Jack) Pearsall: Perhaps the two countries which best illustrate the use of the permanent voters' list are Australia and New Zealand. There is also West Germany. In Australia, however, there is the additional factor of a penalty for those who fail to vote. I think hon. members will recall that through many elections in Australia, as in Canada, one party stays in for very long periods of time. Indeed before the last Australian general election the Governor General saw fit to remove the prime minister from office. He then dissolved parliament and called another election.
In Australia the permanent voters' list is revised at a specific time-it is like bringing in your car to be tuned; voters get tuned at certain times of the year. In the instance I have cited the election came six months too soon and, as a result, many Australians were disfranchised. This points out the weakness of the system, Mr. Speaker; to be effective it should be kept up almost on a monthly basis.
One of the most ideal countries in the world for the operation of a permanent voters' list would be the United States. It is ironic that we should be discussing this today when they are in the throes of an election. Every four years in the United States there is a presidential election. Even if a president should die during his term, or be removed from office, the vice president carries on until the term expires. It happens quite frequently in that country that the elected President and the Senate and House of Representatives are of the opposite parties. I think
November 2, 1976

the last time the president was of the same party as the house was during President Johnson's term. The United States is one of the few countries in the world that could use a permanent voters' list on a federal basis. Some hon. members have stated that there is a permanent voters' list in the United States, but I would point out that it does not apply to all states; there are two or three states with no such system.
It has been mentioned already that Canada tried this system in July, 1934. But in the 1935 election very few people came out to vote, using the normal procedures. In the end many of the members who were elected on that occasion had to go out and find the people and get them registered because there was no proper system. As the hon. member for St. Catharines (Mr. Parent) pointed out, the arrangement had to be abandoned.
Some hon. members have touched on the question of costs. The hon. member for St. Catharines hedged on the costs of the 1974 election and the possible cost of the next one. But, Mr. Speaker, I do not mind putting a figure on it. It will be anywhere from $30 million to $32 million. As the hon. member for Burnaby-Richmond-Delta (Mr. Reynolds) suggested, by reducing the election period from 60 days to 47 days, $2 million could be saved. But here we are playing around with $4 million to $6 million for a permanent voters list.
It is also likely that an additional 1,200 to 1,300 civil servants would be required to keep a permanent voters list up to date. If we want to hold costs down we must think of these things.
The hon. member for Hochelaga (Mr. Lavoie) referred to the problem of people being missed by enumerators. A permanent voters list would correct that problem.
I would like to ask the hon. member for Burnaby-Richmond-Delta and the hon. member for Winnipeg North Centre to join with me in trying to find a way to take care of the absentee vote which is something we do not have in the present Federal Elections Act. The matter of the proxy vote was brought up some years ago by a former member for Coast Chilcotin, Mr. Paul St. Pierre. I do not mind saying that I assisted him as a returning officer and helped him to prepare the proposal. It was milked down considerably in committee. When the matter came before the House of Commons for a vote, it was not in the form I had anticipated. The proxy vote has its weaknesses. It has been abused in two elections. I came across a number of abuses in the 1972 election, and I know there were abuses in the 1974 election.
Hon. members should know that any permanent voters' list would involve high expenses. We ought to be most concerned about those who must be away from home, who are travelling or on holiday and, under the present Canada Elections Act, are denied the privilege of voting, and not so greatly concerned about a permanent voters list.
Let me touch on something else. We spoke of enumerators, but now I raise the matter of participation. We all know what it means, especially when we run political campaigns. Instead
Permanent Voters' List
of being concerned about a permanent voters' list, it would be better if people would take a greater interest in the political process. I would hope that as many Canadians as possible would participate in any general election, would think highly of those who are elected, and take a great interest in individual candidates.
It is possible that if you do away with enumeration and the enumeration system you will take many hundreds of people out of circulation. The hon. member for Hochelaga touched on various subjects and talked about voters' lists. During my six years as a returning officer I knew of no instance of any returning officer anywhere in Canada being involved in underhand dealings involving voters' lists and wrongfully giving out information pertinent to the electoral process. I want to make that point clear because it is possible that allegations of bad dealing have been made by some who could not back up their statements.
As a former electoral officer I have great respect for my former chief, the Chief Electoral Officer, and for all my other colleagues who worked with me during that period.


Some hon. Members:: Hear, hear!


Albert John (Jack) Pearsall: I have been touching areas I had not expected to touch on, Mr. Speaker. I should like to wind up my comments by bringing forward a fact or two. If we introduce any permanent voters list we should need to use some sort of computer system; I do not know if one would be handy or if we could borrow one from some department of government. I have visions of the Chief Electoral Officer being forced to double, even triple his staff here in Ottawa alone if there is to be installed a computer system which will handle everything necessary for making up a permanent voters' list. Frankly I do not think the people of Canada want this. The load put on the Chief Electoral Officer would be enormous, so great that almost a brand new office would be created in the process.
What worries me most is that if we are to establish a permanent voters list-and I have heard few suggestions as to how this is to be done-the Canada Elections Act would become a thing of the past. Mr. Speaker, many years of hard work have gone into the formulation of the act. Members of this House have contributed to it. Hon. members have suggested amendments which are now included in the act and govern the way we conduct our elections.
I can tell hon. members that in the eyes of other countries, Canada's electoral system, based on our present system of enumerating in federal elections, is one of the finest in the world. Other countries look up to us for the way in which we do these things. We are in constant touch with the elector and are involving Canadians in the job they have to do.
I have spoken much too long, Mr. Speaker.


An hon. Member:: Please continue.


Albert John (Jack) Pearsall: I will, if hon. members wish me to continue. I wish to touch on some other points which I think should be brought forward.

November 2, 1976
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An hon. Member:: Brisco wants to speak for a couple of minutes.


Albert John (Jack) Pearsall: I know of the hon. member.


Mr. Brisco:: Then why don't you sit down and let me have a crack at speaking?


Albert John (Jack) Pearsall: Mr. Speaker, this afternoon's discussion does not involve just one side of the House. I have before me, in printed form, the comments of hon. members opposite, of all three parties; they participated in discussions on this subject before the privileges and elections committee during the previous session of parliament. It is most interesting to read some of those comments. One hon. member learned a number of years ago, when touring with the committee, just how good the Canadian electoral system is. He was told in Puerto Rico that, "We respect the Canadian system for the holding of elections." This story was told by an NDP member; 1 do not think the hon. member for Winnipeg North Centre will object if I reveal that the hon. member for Regina-Lake Centre (Mr. Benjamin) mentioned this in committee. He has always been an active member of the committee.


Stanley Howard Knowles: Question.


Albert John (Jack) Pearsall: I am coming to the final part of my remarks. I emphasize, as has been said, that at election time we deal with people. It is all very well to have a permanent voters' list. You can have 21 million or X number on your voters' list; but that is not what counts. What counts is the people who turn out to vote. It does not matter how many are on the list; what matters is how many people become involved in the actual election. That is why our system is so good. The enumerator reminds people they have a job to do, that they must come forward and play their part in the election. Let us not forget that the ballot in Canada is still secret. We are very fortunate in being able to step forward and cast our vote in secret. It is a privilege. I particularly wanted to make that point.
Let me deal with another point which may not have been mentioned. Statistics for the years 1965 to 1971 show that 50 per cent of the people of Canada tend to change their residences within a certain period. We are somewhat nomadic. I understand the figure recently rose to 70 per cent, and the most recent figure may even approach 75 per cent. Our people are not just confinned to Canada, Mr. Speaker; we are to be found all over the world. We are travelling, as never before-


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


Albert John (Jack) Pearsall: Mr. Speaker, I was hoping to finish my sentence-


The Acting Speaker (Mr. Ethier):: Order, please. [Translation]
It being six o'clock, the hour appointed for consideration of private members' business has expired. 1 do now leave the chair until 8 p.m.
At six o'clock the House took recess.
(Mr. Pearsall.]


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.


[Stage Direction]
The House resumed consideration of the motion of Mr. Abbott that Bill C-16, to provide for the protection of borrowers and depositors, to regulate interest on judgment debts, to repeal the Interest Act, the Pawnbrokers Act and the Small Loans Act and to amend certain other statutes in consequence thereof, be read the second time and referred to the Standing Committee on Health, Welfare and Social Affairs.
John Allen Fraser: Mr. Speaker, before the dinner adjournment, as a result of a moment of enthusiasm on the part of some of my colleagues, I was interrupted. One of the consequences of that is that it compels hon. members to hear again what I was saying at the end of my remarks before private members' hour began.
In response to what some hon. members have said throughout the debate so far, keeping in mind that sometimes, perhaps out of thoughtlessness, the thrust of the remarks has almost been an attack on all those who are in lending institutions in this country, and in the financial part of our commercial world, I was pointing out that, next to lawyers, money lenders over the centuries, as literature shows us, have been most unpopular.


An hon. Member:: Just speak for yourself.


John Allen Fraser: That remark was made before the dinner hour. You will have to come up with some new ones now.
The point I am making in all seriousness is that in the commercial world in which we live, and in the economic system which we have, there are legitimate lenders and there are legitimate borrowers. Our particular economic system would probably be in severe difficulty if we reverted to the narrow concepts of the Middle Ages and referred to all those who are in lending institutions or who loan money, whether it be privately in terms of their private friendships or family relationships, or in the commercial world, as a group within the community that are worthy to be the subject of vituperation and attack by either the media, members of parliament, other politicians, or frustrated or antagonistic members of the public. I want to emphasize that almost all of us at one time or another have to borrow money.
1 want to re-emphasize the point that I made before the dinner hour. It is my view that this bill, despite a great deal of talk about loan-sharking and some talk about the criminal element in the country, is not likely to do very much to cure
November 2, 1976

crime in Canada. The real purpose of the bill, as I see it, is to bring about an environment of certainty so that those who do borrow and those who lend clearly understand the arrangement and the deal.
I have a great deal of sympathy, especially with those in a low income position, who often do not have the business experience or sophistication in commercial matters to be able to judge competently when and under what circumstances they should enter into a particular loan transaction.
I said before the dinner hour that one of the suggestions made during the debate was that we should establish, at public expense, agencies which would advise all those who borrowed so that they would not make mistakes. This is probably impracticable because of the amount of borrowing which takes place in this country. I also pointed out that one must consider the philosophic implications of such a course, one which might involve the protection of the public to such an extent that it was difficult for them to exercise any free choice at all; I doubt very much whether the public would thank us for setting up a bureaucracy which, in the end, might be an important factor in determining not only where people could best borrow but whether, in the circumstances, they ought to borrow at all.
It very often happens, in my experience, that when they have no choice but to borrow, people in receipt of low incomes have the determination and capacity to pay back their loans over a long period of time. It is essential though that the environment in which arrangements are made are such that those who borrow know precisely what they are borrowing and what the cost will be.
In his speech, as I also mentioned, the minister commented on the nature of the sanctions imposed against those who offend against the provisions of the bill. These are severe. If I remember correctly, the fine goes up to $10,000, and imprisonment to five years. During yesterday's debate there was some discussion among certain hon. members in the course of which it was suggested that there might not be a jail in the country now which could keep anybody for five years. I know this is not the concern of the minister who is in charge of this bill but it is certainly a matter of concern to some of his colleagues, and to the general public. In any event I did point out that in considering these criminal sanctions we have to bear in mind that there are many people who are not part of any powerful financial institution, and who are not lending as a business, but who occasionally make loans to friends and relatives. These people too will have to pay attention to the law and bear in mind the complexity of its provisions, a situation which could lead to some obvious injustices, and results which no hon. member would desire. In this regard I would draw attention to clause 37 of the bill in which offences are dealt with.
We ought to be very careful when we introduce what amounts to criminal legislation in statutes which are outside the Criminal Code. One of the cardinal rules of British criminal justice is that before a person can be found guilty of a criminal offence there must have been intent, or, in the words
Protection of Borrowers and Depositors of the Latin scholars, mens rea. In other words, the person concerned must have had the intention of acting contrary to the law. Well, clause 37(1) reads as follows:
Any person who (a) stipulates for, demands, exacts or collects from a borrower a credit charge in respect of a lending transaction at a credit charge rate that exceeds the rate prescribed by the regulations for the purposes of this paragraph that was in effect on the day the transaction was entered into... is guilty of an offence and liable .. .
-liable to a fine or to imprisonment, or to both. I would point out there is nothing in this clause which requires intent to do wrong.
The minister is again with us this evening and I say to him once again that this aspect of the legislation should be considered seriously because many people who may make one loan in their whole lifetime to a son-in-law, niece or daughter, or to some other relative, will be caught by the provisions of the act and they could easily stumble into the most innocent mistakes having regard to the complexity of the measure. I believe all of us should be deeply concerned that we do not frame the sanctions in such a way as to bring fines and impose penalties for an innocent mistake on the part of someone who did not knowingly commit any offence, penalties which are not really related to any crime at all. I note, in this regard, that in the offences section, 37(b), the draftsman has gone back to the concept of fault because he says: "Any person who for the purpose of avoiding compliance with this act or the regulations . .." and so on. Here we are looking at something in the proper criminal sense and, of course, 1 have no objection to that.
On the question of the criminal aspects of the bill I would say there are about 44 clauses in it, and in about 20 of them the law will not be clear until we see the regulations which the minister proposes to promulgate at some future time. It does not take much imagination or understanding to realize that when we get into a bill which has criminal overtones and, in some cases, substantive criminal provisions, it is extremely dangerous to be passing criminal legislation in a measure which is outside the Code and where delineation of offences depends upon regulations to be passed at some future date, regulations which might well have to be changed from time to time depending upon circumstances. I raise this point not as an attack upon the bill per se but as one it would be appropriate to consider when we get into committee.


Anthony Chisholm Abbott: I should like to ask the hon. member a question. When he refers to 20 instances in which regulations would have to be passed he is surely not suggesting that there are 20 occasions on which offences would be prescribed?


John Allen Fraser: No, Mr. Speaker, I said that out of 44 clauses there are 20 which would require regulations and that some of those regulations will establish a situation which requires those affected by them to act in a certain way, breach of which would result in the commission of criminal offences under the act. From a question the minister was asked it does appear he is quite aware of the problem, and I am sure we will have his sympathy in committee.

November 2, 1976
Protection of Borrowers and Depositors
I notice that in an early burst of honesty in his speech yesterday the minister said this legislation is long overdue. That, of course, is no argument for passing this bill in its present form. However, it is a reminder to all hon. members that the government party has been in power since 1963 and that for some reason legislation along these lines has not been introduced until now.
Before the dinner adjournment I gave some statistics showing the changing amount of credit in the commercial world in Canada. The minister made reference to another reason for bringing in the bill, and that was that the criminal or near criminal elements have, in the minister's opinion, been taking advantage of the law as it is now and as it will remain unless this bill changes it. I think it is very important that during committee hearings we have the widest ranging evidence possible on this particular aspect that the minister claims is of concern to him, as I am sure it is, as well as other matters.
The bill reaches into what is essentially a very complex part of the economic community and will have effects that probably will not become clear, in some cases, unless the people intimately connected with the day to day workings of the commercial, financial, and lending world are brought before the committee. It is my hope that the committee, with the minister's concurrence, will be generous in the matter of bringing before it the witnesses that are required. I see that the minister is nodding to indicate what seems to be, at least at this moment, general approval.
The minister and others on the government side, in the speeches which have been made so far, have said quite a lot by way of reinforcing their assumption that this bill is completely constitutional and lies entirely within the ambit of federal jurisdiction under the British North America Act. It may, Mr. Speaker, but then again it may not. Speakers for the government have emphasized that it is, Mr. Speaker, but 1 would draw to the minister's attention the fact that clause 8 of the bill seems, at least on the surface, to be in conflict with section 2 of the Ontario legislation, which is the unconscionable transactions relief act. If I remember correctly, there has been litigation on that particular statute but it has been found to be valid provincial legislation. While it is one thing to say that this bill deals with interest-although there are new words for that in the bill-and that it is clearly within federal jurisdiction, I point out the bill also deals with contracts and with the question of property and civil rights, so I put forward the caveat that this bill require some careful consideration in committee.
Clause 8 of the bill deals with the method by which the court, upon application by a borrower, determines whether or not a particular lending transaction is one for which the credit charge is warranted. In the drafting of this particular provision the court is directed to look at five particular considerations in determining whether or not the credit charge rate is warranted. This kind of legislation is unusual for what amounts to establishing what can be a criminal offence. It does not go

unnoticed that they are closed categories in that the court cannot look beyond them to something else.
I bring to the minister's attention the fact that in an ordinary real estate transaction in which there is the transfer of a deed to real property and a mortgage back, especially from a private vendor to a private purchaser, often the interest rate and terms of repayment are a factor of price. I would also say to the minister that such is the case with agreements for sale of land in some provinces, certainly in the province of British Columbia. I would ask the minister to consider that question as it will be raised in committee. Our concern here, of course, is that we must be careful not to draft legislation that restricts the court from considering every aspect that should be taken into consideration in establishing what is proper and fair.
In his speech yesterday the minister said that the object of this whole exercise, among other things was:
-to require a full, uniform and comprehensible disclosure system so that the consumer, before he enters into a deposit or borrowing transaction, will know all his rights and the obligations he will have to bear.
I think that, more than anything else, is the thrust of this legislation. However, I point out to the minister that out of 44 clauses we seem to have 20 cases that will require regulation in order to clarify the meaning of the legislation. I hope that during committee hearings the minister will agree with us that some of what he plans to place in the regulations would be appropriate to place in sections of the statute.
In his speech yesterday the minister also illustrated the effect of different interest rates on loans which apparently have the same face value. The minister took a number of examples. On a $4,000 loan with a declared rate of 12 per cent per annum, depending on deductions from the loan for various charges and other things, you could end up, Mr. Speaker, with a different interest rate. This illustration appears at page 635 of Hansard.
As his first example the minister took a loan of $4,000 with no deductions. At the end of three years the borrower would pay $4,782.96, an effective interest rate of 12.68 per cent per annum. Then the minister illustrated higher deductions from the borrowed amount. In one case there was a deduction of $50 for insurance and registration. In other case it was $250 for registration, insurance and legal fees. In yet another case it was $650 for life insurance, registration, legal fees, finder's fee and bonus.
Keeping away entirely from the aspect of provincial registration fees and other things over which a particular lender has no control, the fact of the matter is that when you get items which are deducted, such as the cost of life insurance and other things, those are of clear advantage to the borrower and it makes the example which the minister put forward a little dubious because, after all, if somebody is using part of the borrowed money to take an advantage, then of course it is going to change the interest rate on the balance outstanding after the advantage deducted has worked to the benefit of the
November 2, 1976

borrower. That is something that should be taken into consideration just so as to keep everything here in perspective.
The minister said the following in his speech yesterday, as reported at page 636 of Hansard'.
Following passage of this bill, it will be our intention to mount a comprehensive program to assist low income borrowers in the marketplace.
I do not know quite what the minister has in mind, and I think that while that does not seem to be an aspect of the provisions of the bill, it seems to be a statement of intention on the part of the minister relating to what will be government policy in his own department.
I think that before the debate is over it would be appropriate if speakers on behalf of the government enlarged a little on the bill at second reading to let us know what the government has in mind because those words can be innocuous enough until we start to find out, as we may well do, that the comprehensive program to assist low income borrowers in the market place may indeed be the structure of a whole new bureaucracy. We have no idea what this involves, and while I think that many of us have some understanding of some of the problems that the minister is concerned about in this bill, we have considerable sympathy for trying as much as is reasonable and possible to educate people not to make foolish mistakes in entering into long obligations. Nonetheless it is important that we know exactly what the minister has in mind. It may well be-I can only say this in speculation-that his department already has decided that if this bill becomes law it will be necessary to have a very extensive and quite possibly expensive counselling service across the country so that people can cope with the bill. If that indeed is the result that the minister foresees, then the bill will have to be looked at most carefully, and I invite the minister to consult with some of his colleagues and let us know before this debate is over just exactly what he has in mind.
1 want to emphasize again that this party supports this bill in principle. I think that in the remarks which all hon. members have heard from members on this side of the House concern has been expressed that the bill be efficient, effective, fair and that it works. In this spirit may I say that I hope that some of the comments that I have made tonight will be considered by my colleagues on all sides of the House, and I look forward to working with all our colleagues in committee as this bill is given more careful and appropriate examination.


Mr. F. A. Philbrook (Halton):: Mr. Speaker, 1 would like to thank the previous speaker, the hon. member for Vancouver South (Mr. Fraser), for his usual fair and intelligent if somewhat lengthy approach to this particular subject.


John Allen Fraser: It takes time to make sense.


Frank A. Philbrook: Even more so I wish to congratulate the present Minister of Consumer and Corporate Affairs (Mr. Abbott), as well as his two predecessors, for a highly successful effort in drafting a piece of legislation which offers such comprehensive protection to the Canadian consumer in search of financial assistance. It has been some time now since this legislation was first proposed to us, but I think the end result.
Protection of Borrowers and Depositors has fully justified the wait. It is clear that no effort was spared to obtain the views and assistance of experts in this field- from police authorities, to lending institutions, to the borrowers themselves. Under this legislation the borrower will be provided with the best possible protection, but at the same time without any interference in normal, legitimate financing practices.
It has been noted already in this debate that outstanding consumer credit went from $835 million in 1948 to $8.6 billion in 1967, and amounted to almost $24 billion in 1974. As this has been going on there has also been a concomitant rise in interest rates. This is as it should be; the laws of supply and demand call for it. This legislation is very timely, therefore, because as more and more people borrow money they must have an assurance that the laws of supply and demand work with them rather than against them.
Borrowers are usually very vulnerable people and are easily taken advantage of by unscrupulous lenders. The normal relationships between supply and demand can tend to be distorted therefore when a borrower needs a lender more than the lender needs the borrower. Thus every precaution must be taken to help maintain an equitable balance between these two parties. The borrowers and depositors protection bill does just that.
On the one hand this legislation provides straightforward legal sanctions against usurers and loansharks who prey on people who are often desperately short of money. On the other hand it enables the consumer to protect himself, by providing greater access to information regarding any such financial transaction. Together these dual roles will maintain the crucial balance which permits the relationship between supply and demand to work most efficiently and equitably.
I believe these two functions are of equal importance to the effectiveness of the legislation. I shall leave it to others to expand on the merits of the latter, concerning increased availability of information to the borrower. Instead I wish to focus my discussion on the specific means proposed to do away with one of the most despicable practices of our society.
This legislation is intended to replace the present concept of fixed ceilings on interest rates with three distinct rate categories: normal or "legitimate" rates; "unwarranted" rates; and "criminal" rates.
Presently the vicious business of loan sharking is, in a sense, indistinguishable from the more subtle practices of "expensive" lending firms or the entirely legitimate terms of a reputable financial institution. All are equally legal under today's inadequate usury laws-at least in so far as their monetary transactions are concerned. While the Small Loans Act, for example, sets a maximum interest rate of 24 per cent per year on loans of less than $1,500, the lender can charge any interest he wants, no matter how exorbitant, on loans above $1,500. Moreover, even when violators of the Small Loans Act are caught, the fines are too small-compared to the usual yield of the loans themselves-to provide any kind of deterrent.

November 2, 1976
Protection of Borrowers and Depositors
The borrowers and depositors protection bill rectifies this incongruous situation through its differential rate structure. By establishing an "unwarranted" rate category, this legislation draws a clear distinction between legitimate interest rates on personal loans as determined in a competitive market and rates which are unnecessarily high. As the minister has explained, the "unwarranted" rate enables the borrower to take recourse against credit terms which cannot be justified by the nature of the risk involved-as in the case of especially low-risk loans-or by prevailing market conditions.
The "criminal" rate category, meanwhile, is directed specifically at loansharks and userers who run clandestine operations and who charge far more exorbitant rates than even those in the unwarranted category. Conviction for this type of offence would incur a realistically stiff penalty of up to $10,000, and two years in jail under the proposed legislation.
It has been the contention of some members of the opposition that, even with a criminal rate, the borrower is still not given adequate protection because the rate shall be set too high. To make such a claim is to ignore the need for flexibility in setting interest rates according to appropriate criteria, such as risk and duration, and to display a serious misunderstanding of the intention of the legislation as a whole. It is not a set of artificially conceived interest rates divorced from the realities of the market place, but a comprehensive, integrated program designed to bring social and economic priorities into balance. Caution must be taken not to let the criminal rate interfere with legitimately high rates. The range of legitimate rates will be made evident from the combined factors of full disclosure at the time a loan is made, the unwarranted rate range, and the new provisions for penalty-free prepayment on outstanding debts.
May I dwell for a moment, Mr. Speaker, on this last factor, the prepayment of loans? Quite simply, this provision will allow a borrower to repay any non-mortgage loan, in part or in full, before the allotted time has expired, without having to pay a penalty. This means that the borrower will only have to pay for funds for as long as he borrowed them. Here again the internal logic of the market place is reinforced as the borrower is released from unrealistic constraints and is allowed to move freely from one lender to another whenever and wherever more favourable rates can be found. This will have the inevitable effect of making the cost of borrowed money more elastic and will force lenders to police themselves so that they may keep rates down to competitive levels.
There is yet another major innovation provided in this bill which is designed to bolster the borrower's bargaining position and, thereby, provide him with more effective means to protect himself. This is the reversal of the present principle that the burden of proof rests with the borrower in loan disputes. Instead this bill would place the onus on the lender to prove that his interest charges were not unreasonable. In this fashion we can expect borrowers, who until now have had to fear
[Mr. Philbrook.J
reprisals and legal fees, to stand up and expose the usurers at whose mercy they have been for too long.
Once again, the net results can be none other than increased self-control by the lender and more reasonable rates for the borrower. With an estimated annual return of about $3 billion, loansharking has become the second largest source of income for organized crime after drug trafficking. Because the loan shark tends to prey on the poor, however, few of us realize just how big a big business it really is.
Let us look at some more startling statistics. According to revelations made at the Quebec inquiry into organized crime, 1,496 counts of shylocking were made under provincial laws and the small business loans regulations in 1973. This amounted to $3.5 million in loans and, according to inquiry officials, approximately $35 million in profits. Most startling of all, this amount was accumulated by only the 29 people who happened to be brought to justice, representing somewhere between 1 per cent and 5 per cent of the estimated total number of loan sharks operating within the Montreal area alone. This is not a very good conviction rate.
Perhaps even more dangerous to society as a whole than loansharking itself is the fact that it fosters and provokes many other forms of crime. People victimized by loan sharks can themselves be driven into criminal activity. When a borrower is terrorized with violence for defaulting on payments, he or she often chooses to push drugs, or counterfeit money, rob, or turn to prostitution; anything becomes preferable to dismemberment or death.
Along the same lines, loan sharks are a common source of funds needed for illicit purposes, such as the purchase of stolen or illegal goods, which a reputable lender would never provide. It is quite evident therefore that the effects of loansharking go well beyond the crimes perpetrated by the loan shark himself.
Just this morning on the front page of the Globe and Mail I noticed an article which speculates about the growth of yet another crime syndicate, this one in the Toronto-Hamilton area-my area where I am aware of certain concerns. What is one of their main activities? Loansharking. What are some of the consequences reported? Three deaths, an OHIP swindle amounting to about $150,000 and, most frightening of all, some curious connections with officials of the Ontario government.
If this bill does not pass with its strongly anti-loansharking provisions intact, police authorities will continue to be frustrated in their attempts to break a most vicious cycle of crime which is fueled by such activity. The loan shark will continue to prey on the most disadvantaged and those who are least capable of getting out of debt. He will continue to discount UIC cheques and welfare payments at a fraction of their cost from those who can least afford to lose them. In a more general sense, he will continue to terrorize all of us as organized crime grows into a bigger and bigger big business.
If this legislation is passed, however, we shall witness some much needed changes in the nature of borrower-lender relationships in this country. When artificial rate ceilings are
November 2, 1976

removed and the equity of competitive rates reinstated, we will have reduced much of the need for borrowers to turn to, and support, socially undesirable sources. Let me emphasize once again therefore how this bill can be expected to have far-reaching effects, not only in bringing the usurers to justice, but in reducing related crimes in other areas as well.
Neither I nor the government wish to discourage borrowing. It is an accepted way of life in the modern age, and it is generally regarded as a good and proper means of maintaining growth. Of late, however, we seem to have reached a peak in borrrowing. With interest rates steadily on the rise and the uncertainties about the furture brought on by inflation, consumer borrowing has actually begun to diminish slightly since the summer of 1975. I believe it is the responsibility of this House to assure the consumer that he can borrow money for legitimate purposes from ligitimate sources without having to worry about hidden fees, disguised costs, and perpetual indebtedness. The consumer should be allowed to borrow intelligently, so that he may feel confident to spend whenever the need arises.
Consumer spending would help the recovery this year by promising retail business and, consequently, industrial production. Consumer borrowing would contribute immensely to the recovery process as long as it is channelled properly, according to the dictates of the open market, into proper investments under equitable terms. This bill should do just that.
In closing I should like once again to congratulate the new Minister of Consumer and Corporate Affairs and wish him well in his new career.


Mr.   C.-A. Gauthier@Roberval: Mr. Speaker, allow me first of all to say how pleased I was to hear the minister introduce Bill C-16 whose object is to give some measure of protection to borrowers and depositors. This bill is an act to, and I quote:
provide for the protection of borrowers and depositors, to regulate interest on judgment debts, to repeal the Interest Act, the Pawnbrokers Act and the Small Loans Act to amend certain other statutes in consequence thereof.
Mr. Speaker, I did say "some measure of protection" because, on reading the bill, 1 find that the government avoided attacking the root of the problem, namely excessive interest rates which are the major cause of the inflation we know today.
In introducing his bill, the minister is disconcertingly timid when he says and I quote:
I would not wish to leave the impression that Canadians are ill-served by the overwhelming majority of their lending institutions. Our banks are rightly acknowledged as some of the largest and best run in the world.
He could at least have added that they are also among the most favoured and protected in the world by their governments. If the minister is really convinced of that, why then did he ask his civil servants to think out and draft such a bill? The fact that the act has not been revised in 20 years does not necessarily make it obsolete, as the minister claims.
Protection of Borrowers and Depositors
If it has become obsolete, it is because of the tolerance and "laissez-faire" attitude of succeeding governments in an effort to serve, first of all, big finance. Also, the taxpayers were left completely at the mercy of loan sharks whose pecuniary appetites are never satiated. Today the government discovers that consumers are too much in debt. That discovery comes at least 20 years too late since, from 1947 to 1975, personal debts increased three times faster than personal incomes.
How can we hope, with a timid piece of legislation such as this one, to keep afloat consumers as a whole who are sumerged under this nountain eh debts? I say this bill is only a gleam of hope, which might be the last one, with which we lure the Canadian people to enable them to avoid being in the most complete deficit situation.
Let us talk a little about the interest paid on deposits and about the way to figure out this interest. 1 think not a single bank gives the same interest rate on deposits in savings accounts and the way they pay this interest is still worse. To do justice to depositors the interest should be calculated each month so that if a depositor withdraws money occasionally, this is not reflected on the interest for the other months. We must keep in mind, and the people as a whole should be well informed in this regard, that these savings accounts of the workers build up the reserves of chartered banks. According to the Bank Act, the banks have the power to increase the value of these savings five times and to lend the total at an 11 and even 12 per cent interest rate.
In brief, if the bank agrees to open a savings account for a depositor, every $100 deposit he makes allows the bank to lend $1,500 at 10 or 11 per cent, and even at a higher rate sometimes, to a potential lender. In other words, the bank will pay the depositor $8 in interest while on that same $100 it will be able to get up to $160 in interest. So every $8 spent in interest by the chartered banks brings in $160. And then the banks tell us that money is expensive for them. Worse still, these same banks try by every possible means to reduce the depositor's interest. Therefore, I say that in addition to proposing a uniform interest formula, this bill should also provide that interest in the accounts-being in fact the bank's legal reserve-be paid each month.
Let us come back now to the lenders who have been given free way over the last few years. What else could be expected when the example came from the top? Everybody remembers that when the Bank Act was last amended the Liberal government removed the interest ceiling for chartered banks. Chartered banks-the most important institutions in Canada-are now allowed to ask any interest rate they want simply because the government has suppressed the interest rate ceiling. And after such an aberration, we wonder about the inflation rate.
Mr. Speaker, I said it time and again in this House that inflation started when the government removed all restraints to banking operations. You know very well, Mr. Speaker, that when a bank is permitted to charge rates of 10 and even 12 per cent, no lending institution will likely operate below that level. I do not say that I agree with excessive rates practiced by some private lenders but I suggest that we should start from the
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November 2, 1976
Protection of Borrowers and Depositors beginning. Let us take the bull by the horns instead of trying to hold it back by the tail.
This is why I was saying at the outset that this government was afraid of coming to grips with this problem. It is constantly trying to evade the issue, making people believe that one day-not today and not tomorrow either-the government is going to be logical and tackle the real problems facing the workers. Meanwhile, through Bill C-16 it will try to cool off the small lenders who, as we all know, are taking unfair advantage of the consumers.
Bill C-16, dealing with prepayments, has a clause according to which a borrower who wants to make a prepayment is not liable to any penalty when he comes to pay the total amount outstanding under the transaction. For example, say a finance company makes a loan repayable over 36 months, and the borrower finds a way to pay back within 10 or 12 months. Why should the borrower have to pay interest for 36 months or even for 5 or 6 months more only because he wants to get rid of his debt? We should not forget, Mr. Speaker, that when the lending institution gets full prepayment from the borrower, it can lend this very amount on the following day and for months get double interest on the same loan. And the government was well aware of these legal thefts. Why did it tolerate them? The other governments were also aware of them. Why have they tolerated them during the last twenty years?
Another sad situation, like the minister indicated, is the widespread practice in Canada of lending money on welfare cheques or tax refunds. This practice is quite widespread in areas of high unemployment and welfare. It is very natural for a family man who has four or five children to feed and who has to wait for his unemployment cheque for one and maybe two or three months to try to find some money somewhere. This is quite natural. He must find money to feed his family. When a man who is unemployed comes to see me and I read on his benefit card "Case under study", I know that the situation is serious, Mr. Speaker. For weeks and weeks it is written on top of his card "Case under study". I wonder if the minister, who gives overly strict orders to his officials when he demands lengthy investigations like those that are still being carried out for forest workers, is well aware of the damage that he is doing to these family men.
I have just learned that in a case which has come up in the last few days, a delay of eight to ten weeks in the payment of benefits was caused by the fact that the official must enquire personally from each forestry employer to ensure that the beneficiary is really entitled to the stamps. Mr. Speaker, nothing could be more ridiculous. We shall soon need an army to go through forestry sites to check if such or such a forestry worker is entitled to unemployment insurance. This is shocking! That is why forestry workers must go to pawnbrokers to whom they will sometimes give up to one third of their benefits to feed their family. Who must we blame, Mr. Speaker, in such circumstances?
Before putting the blame on lenders, I must put the blame on the minister because of his restrictive laws whose impact is amplified by regulations which are even more restrictive. Thus,
[Mr. Gauthier (Roberval).J
we can wonder if the Unemployment Insurance Act was not made in the first place for civil servants so that the greatest number of people could work in the civil service. Sometimes you feel that the unemployed is considered a criminal because he cannot find a job. His family will be left to vegetate and his children will be in danger of getting ill. I could give similar examples about welfare recipients who are obliged to call upon such lenders as are mentioned in Bill C-16. In the case of income tax refunds, the situation is also quite bad. Some people are waiting for their income tax refund cheque and must borrow money to pay their debts.
Mr. Speaker, I cannot understand why a responsible government cannot take the necessary measures so that everything could be done in time. However, we feel that the number of employees is quite sufficient. To my mind, they are so numerous that they create a state of confusion and quite often the cheques are lost because we have too many civil servants.
To sum up, I would say that all these cases are due to bad management by the departments concerned. These lenders could not survive if the government could better understand the social problems and if it were more conscious of its responsibilities. Finally, I would like to come back to the subject of mortgage loans. I wonder why the minister makes a difference between ordinary loans and mortgage loans when it comes to prepayments. I cannot understand why insurance companies or other lending institutions that grant mortgage loans would punish a borrower who wants to repay his loan.
Maybe somebody will tell me that it is because the lending company had to make a contract or raise mortgages, but we should not forget that it is the borrower who pays, it is not the company, all the costs are to the borrower. I could understand the situation if the lending insurance company had to respect the original interest rate. But, every five years, the companies have the right to increase their interest rates so that a loan granted at a rate of 6 or 7 per cent a few years ago can reach an interest rate of 10 to 12 per cent according to the whims of the lending companies.
And this is done with the blessings of our governments. The ony apology the minister gives us for his apathy is that, because of the particular nature of mortgages and of the mortgage market, he can do nothing but accept the present situation. Did anybody take into consideration the excessive profits of insurance companies? Did anybody wonder where these companies took the money to build their huge skyscrapers? From the pockets of those who will be all their lives the victims of those companies.
Those lending companies cling to their customers as leeches cling to their victims. They set insurance premiums, the amounts of municipal rates, school, taxes and all through the year they collect them and hand them over at the very end of the year and often two months late. What do they do with the money they collect each month? They lend it for 12 months and draw the interests and thus all those interests are added to the interests levied on mortgages. The government does not want to legislate in those fields. Is it an accomplice or does it merely ignore what is going on?
November 2, 1976

Mr. Speaker, we approve Bill C-16 and hope it will be referred to the committee of the whole to make the necessary amendments and make it more acceptable and more effective for all Canadians.


Hon. Herb Gray (Windsor West):: Mr. Speaker, this Bill helps carry out, with certain important exceptions which I shall mention shortly, the key plank in the election platform on which the Liberal party fought and won the election of July, 1974. The fact that the bill came some 2Vi years after that election makes it no less welcome. It represents a long overdue and greatly needed reform and updating of federal law dealing with consumer credit.
I am pleased to see the bill since the carrying out of such a reform and updating of federal consumer law was an initiative I announced as minister before the 1974 election, and work on this was under way as the campaign began.
The bill has many desirable features. For example, two were stated in the 1974 election platform in these terms: "Legislation requiring disclosure of the effective rate of interest in all interest-bearing transactions" and, "Legislation allowing the buyer to pay off residential mortgages during the first five years of the agreement without excessive penalties." However, the many desirable features of the bill were outlined by the minister is his speech opening the debate on second reading, as well as in the material he released at the time the bill was first tabled in the House a few days ago. Therefore I do not intend to state them all again at this time. However, I do want to make some comments and raise some questions about some of the things that are in the bill and, more important, about some of the things that are not.
My purpose is a constructive one. My aim is to help ensure that by the time it is adopted the bill is the best one possible and, therefore, the kind of legislation that Canadian consumers are entitled to get from their federal government. In spite of all the good features of the legislation I do not think a case has been sufficiently made as yet that it is already at this level of achievement.
It is good to know that the bill will require a lender to inform a consumer of the true total cost of a loan and that the lender must include it in the total credit charge. However, the question remains as to whether the bill deals in the best way with the problem of excessive credit charges, of excessive interest rates. The bill proposes the repeal of the Small Loans Act with its ceiling on interest rates charged on loans of less than $1,500. In its place it proposes that there be what in effect is a maximum permissible ceiling set by regulation-the criminal rate of interest-and that any rate below this is acceptable unless a court rules it is unwarranted. The minister has not yet said what this criminal rate will be. I gather it is intended to be very high. I understand that a rate of at least 70 per cent per annum is being contemplated.
Protection of Borrowers and Depositors


An hon. Member:: Shame!


Herbert Eser (Herb) Gray: All this means that the only recourse a consumer will have if he is charged a rate which is high but below the very high criminal rate is to ask a court to rule that it is unwarranted, or not to pay it and wait until he is sued, at which time the lender will have to prove that the rate is not unwarranted.
The act also says that the borrower can pay off the loan at any time, assuming of course that he is able to find the necessary funds at a lower rate. However, this latter opportunity also has its limitations and problems which I will refer to in a moment. Frankly I do not think that it is totally realistic to expect the average consumer-borrower who does not like the rate he is being charged for a transaction to have recourse to the courts as his basic form of relief. We are talking about people who, in many cases, are of low income, of limited education, and who are hesitant and unsure of themselves when it comes to dealing with large organizations, whether they be business or government. They find, as do most Canadians, our court system to be forbidding and unknown territory which is difficult and costly to enter or to leave. The bill does nothing to remove these legitimate kinds of concerns.
The borrower can apply to a court to review the transaction and to ask that the credit charge be declared unwarranted. But to what court can he apply? According to the bill it will not be to a small claims court with its relative lack of paper work, formality and cost. Instead he will have to apply to a county court or some other superior court, with all this means in terms of red tape, formality and expense, including the practical necessity of having a lawyer.
The borrower can cease his payments and wait until he is sued for payment, hoping that the court will say the lender has not discharged the onus the bill will put on him to prove the rate is unwarranted. However, the borrower will them have the often frightening experience of being served legal papers and going into the unfamiliar environment of the court system, with the cost of legal representation and so on.
The burden of proof, the onus, may be on the lender to prove the rate is warranted. However, this does not mean that the burden can never be discharged by the lender and that the court will always, or even generally, find in favour of the borrower and will declare the rate to be unwarranted and, therefore, not payable. The proceedings in question will be civil and not criminal in nature. This means the lender will not have to prove his case beyond a reasonable doubt, as he would in a criminal case if the onus of proof were on his shoulders. The benefit of any doubt will not, therefore, have to be given to the borrower, as has to be done for the defendant in a criminal case. All the lender has to do is to prove his case, as the bill says, "to the satisfaction of the court," which I presume means discharging the burden of proof in civil cases, proving his point on a balance of the probabilities and in the light of the factors set out in the bill in this regard.
It may well be that the judges will not find it difficult in many cases to do this after looking at such factors as "the cost
80001 -451/2

November 2, 1976
Protection of Borrowers and Depositors of funds to the lender at and about the time the lending transaction was entered into;" "other costs to the lender of doing business that are reasonable having regard to the nature and scale of business of the lender;" and, "the degree of risk assumed by the lender having regard to the nature and value of any security provided, and the age, business capacity, financial position and mental and physical health of the borrower", and they will find the lender has proved his point.
The protection the bill promises the unwarranted charge concept will bring may well prove to be an illusion for many borrowers once it becomes law, especially those who now benefit from the maximum ceiling rates under the Small Loans Act for loans under $1,500. The minister in the speech in which he opened this debate talked about the limited protection now given by the Small Loans Act, pointing out that it does not apply to loans over $1,500. He pointed out as well that the total amount of loans made under the ceiling has been steadily declining in recent years. This may well be generally true. However, there are still very substantial numbers of people obtaining loans under the $1,500 ceiling and therefore benefiting from the approach of the existing Small Loans Act.
The latest report of the Superintendent of Insurance on the operations of small loans companies and money lenders licensed under the Small Loans Act is for the year ending December 31, 1974. The report states that in 1974 there were $412,204,415 in loans made under the $1,500 ceiling involving a total of 647,739 accounts. The minister said in his speech that only $296 million was lent in 1974 under the Small Loans Act ceiling. This does not appear correct from my reading of the 1974 report. Perhaps he will explain this discrepancy when he winds up the debate.
What will happen to the more than half a million people who apparently have been benefiting from the step rate and ceilings approach of the Small Loans Act, if this bill is passed in its present form? They will be left to what may turn out to be the illusory protection of the unwarranted rate concept with which the government proposes to replace what presently exists. We have had something like the unwarranted rate concept in the unconscionable transactions relief acts that have been in place for many years in most if not all of the provinces. The fact is, however, that they have been rarely used by consumer borrowers and, when used, rarely found beneficial by them. Also, what is to prevent a lender or a group of lenders from having an informal black list of people who have gone to court to complain that a credit charge is unwarranted? Will someone who asks a court to declare a credit charge unwarranted ever be able to get a loan again from the lender in question, or any lender? The bill does not deal with this particular problem that could be created by the unwarranted rate concept it proposes.
I think it is somewhat unreal and impractical to expect most borrowers faced with excessive credit charges to go on their own to the courts in order to take advantage of the new provisions in the bill, supposedly for their greater protection. In the bill the government is not proposing any mechanism of

its own to initiate and present applications for relief on behalf of borrowers, not is the government proposing to help pay the cost of such court action where a borrower goes to court on his own. Also the government is not proposing any mechanism of its own to defend the borrower or help the borrower bear the cost of defence where the borrower is taken to court for refusing to pay unwarranted credit charges.
To be meaningful, the unwarranted rate concept must require the administrator appointed under the act and his staff to act on behalf, at the very least, of low-income borrowers, to bring action on their behalf before the courts or to defend actions for the purpose of having the court rule the credit charge in question unwarranted. In any event, the minister has not in my view as yet sufficiently made the case for the total abandonment of the step rate ceiling approach of the present Small Loans Act. The fact that the $1,500 ceiling and the rates set out in the act may be out-of-date does not mean the concept as a whole should be totally abandoned. Instead this is simply an argument for raising the ceiling and providing a new formula for setting acceptable interest rates.
The Royal Commission on Banking and Finance, the Porter Commission, did not propose removing the ceiling. The special joint committee of the Senate and House on Consumer Credit-The Croll-Basford Committee-did not recommend removing the ceiling. Instead after careful study they both recommended raising it to a more appropriate level-which at the time of their reports they said should be $5,000 rather than $1,500-and also modifying the allowable rates of interest.
One co-chairman of that special committee is now our distinguished and capable Minister of Justice (Mr. Basford) in this government which has presented the bill we are now debating. It seems to me that the point of view of his famous report on consumer credit, on the desirability of the ceiling system for small loans, still has validity today.
Also let us look at the Liberal election platform of 1974. This platform did not propose removing that ceiling. The Consumers Association of Canada now has urged that the maximum rate and ceiling concept of the Small Loans Act be maintained. Proposals in this bill to eliminate that approach must be carefully examined to see if they will, in fact, achieve the objectives claimed for them of providing greater access to credit at more reasonable rates for borrowers, while providing them with easy access for relief if they accept unwarranted rates.
However, this bill does nothing to ensure that the low income borrower who has in the past found it difficult to obtain credit from legitimate institutions, will not continue to be forced into the hands of loan sharks rather than getting that credit from legitimate lenders. The bill does nothing to ensure that the borrower, who found it difficult in the past to get credit except from companies licensed under the Small Loans Act, will, when this bill is passed, get credit on terms as favourable as those now provided for loans under the act, either from small loan companies or other credit granting
November 2, 1976

institutions. The minister in his speech on second reading said at one point:
That is why we propose the repeal of the Small Loans Act. Instead we are proposing a strong and comprehensive set of protective devices applicable to all forms and levels of consumer credit so that consumers will be assured of access to loans bearing fair and reasonable credit charges.
At another point in that same speech he said:
-I would remind the House of the prepayment privilege and the unwarranted rate provision. A low income borrower who is a good risk-and many of them are-is entitled to get a rate that takes that fact into account. His credit rating may be as good and perhaps better than that of higher income people, but because he is ill-informed, timid, or a person alarmed by forms, he will tend to avoid institutions which will gladly deal with him. Now this borrower can go freely to any institution, obtain a loan at rates commensurate with his true credit risk, and prepay the higher rate loan he is carrying.
However, in spite of the impression conveyed by these words, if the bill simply is passed in its present form, no lender will be obliged to make any loan he is not obliged to make now, and lenders have never been obliged to make loans. No borrower will have any greater right to obtain credit, to obtain a loan, after the bill is passed than he has at present.
The bill adds nothing by way of any absolute assurance that individual consumer borrowers, who consider themselves sufficiently credit worthy to obtain loans at reasonable rates, will ever get them. In fact totally absent from the bill is a pledge made quite explicitly in the 1974 Liberal election platform which said:
The Liberal policy includes .. . plan for a low-income insurance plan to help establish credit for low-income, steadily employed wage earners.
We need explanations as to why the program promised in the 1974 election platform is not in the bill right now. We should have the government's commitment, before the bill finally becomes law, to the early creation of such a program. If this program comes in the form of federal government guarantees against loss for loans made by financial institutions to low-income, steadily employed borrowers, there would be no valid argument that such a program would be too costly to the public treasury. However, such a program would help fill a need the bill really does not deal with adequately.
The minister's second reading speech said:
In placing this bill before the House, I would not wish to leave the impression that Canadians are ill-served by the overwhelming majority of their lending institutions.
I suppose it is generally correct that these institutions are of good quality in comparison to much of the rest of the world and that they do provide adequately for the needs of many Canadians. But having said this, the question remains, if it is true as the minister says in his speech that the "police estimate that loan sharking has become a $3 billion a year business in Canada" why should this be the case? Why should a business of this size have developed? If our lending institutions are doing as good a job as the minister says, why do so many Canadians feel that they must turn to loan sharks in order to fill their needs for credit? Why do so many apparently feel that loan sharks are more accessible than our much vaunted financial institutions? Neither the bill nor the minister's speech gives us any real answer to these key questions.
Protection of Borrowers and Depositors
However, the high degree of recourse by consumer-borrowers to loan sharks as described by the minister leads to the conclusions, in my view at least, that there is something necessary in the field of consumer credit that our legitimate financial institutions are not doing. There is a gap they are not filling. To fill this gap calls for early co-operative action both by financial institutions and the government, with the government showing leadership in filling the need of low-income borrowers. This involves not only a special lending program of the type outlined in the election platform but also a new, wide-ranging program for consumer education on the wise use and choice of credit. Such a program has not yet been proposed either in the bill or in the minister's speech on behalf of the government.
An aim of the bill is to enable strong action to be taken against loan sharks. The criminal rate concept, the requirements for record keeping, prohibition against oppressive treatment and harassment of borrowers will all be helpful for this purpose. However, something is missing from the bill which is very important when it comes to dealing with loan sharks. It is something which is also very important for dealing with lenders who do not exactly fall in the loan shark category but whose practices can be described as questionable if not as being downright unscrupulous.
What is missing from the bill is the concept of licensing. The 1974 Liberal election platform promised:
-legislation requiring federal registration of all money lenders not already registered who lend to individuals.
Not only has this promise not been carried out in the bill but the bill actually proposes the elimination of those requirements already in our law for the licensing of small loans companies and money lenders as defined in the Small Loans Act. No explanation has been given, not only for the seeming abandonment of that 1974 election pledge, but also of the licensing provisions we already have. Licensing procedures can be an effective way of ensuring that those subject to them meet the standards of the law with regard to acceptable conduct in the market place. They can be used to remove from the market place entirely those who have shown through their past conduct that they do not deserve to be there at all. A licensing system provides a basis for cease and desist proceedings and voluntary compliance proceedings that can be quicker and more effective in many instances than having recourse solely to prosecutions which often result only in monetary penalties against the lender with no meaningful direct redress for borrowers.
The bill before us would not prevent anyone from continuing to make loans using questionable or unscrupulous techniques, no matter how many times such a lender were to be convicted under the act or how many times the court ruled the credit charges extracted by that lender to be unwarranted. As long as the lender could find enough unwary customers, it could stay in business.

November 2, 1976
Protection of Borrowers and Depositors
A licensing procedure authorizing a tribunal to order the removal of the licence after a fair hearing and with rights of appeal could deal effectively with this kind of bad actor in the market place. The proposed law will not only allow them to continue operating, it even removes from the sanction and scrutiny of a licensing procedure those firms now obliged to subject themselves to it under the present Small Loans Act. The lack of a licensing procedure should at the very least, be explained and justified by the government during the course of consideration of this bill.
A simple approach would be to require the licensing, the registration, of all moneylenders not subject to be licensed under other federal or provincial laws. One can agree that duplication of licensing is not necessary. But why remove even the requirement for licensing from those now subject to it under the existing law? Whatever may be said for the authority to be given to the new administrator under the act, that authority is not to exercise a licensing jurisdiction.
The bill gives those harmed through infractions of it the right to sue for civil damages. This is a step in the right direction, but its value is limited. There is the whole problem of access to the courts as discussed earlier. Also, the cost of going to court may not be worth while, even though the interest as a percentage of the loan is very high, if the loan itself is small. The bill provides no right, as it should, for borrowers similarly harmed by a lender or group of lenders to band together through a class action to achieve relief through the courts, something which might not be worth while for them to do alone. The bill also makes no provision for the administrator to take action for damages even on behalf of individual low income borrowers.
In looking at the unwarranted rate concept, it should be noted that a decision by a court that a rate is unwarranted applies only to the case which is brought before it-to the one transaction for which a review is sought. Certainly the same judge, or another, may use such a ruling as a precedent when considering another case. However, a decision that a rate is unwarranted will not be binding on lenders with respect to any other transaction even though such other transaction may contain identical terms. Further individual court actions would have to be undertaken.
Therefore it could well be that the fear of having their credit charges challenged in court as being unwarranted might not have the salutary and self-policing effect hoped for by the government and expressed in the minister's speech. Instead, some lenders might rely on their understanding of the law of averages, expecting that while some of their loans might be challenged as unwarranted, most would not be challenged, for the reasons I have already outlined. Some lenders might well decide to take their chances in the expectation that while a few of their loans and credit charges would be struck down by the courts, any loss involved would be more than made up by excessive and unjustified gains from charging rates which might be unwarranted but which would never be looked at by any court, no matter what the bill in its present form may say.

Finally, Mr. Speaker, much of the effectiveness of the act will come not from what is said in the bill itself but rather in regulations, the contents of which have not yet been disclosed to us. There are more than 20 places in the bill where matters are left to be defined and made meaningful by regulation.
I would also point out that the bill would allow even those beneficial features it contains to be made meaningless-to be withdrawn-since, according to clause 31 (l)(a) the government may make regulations "exempting any class of lending transactions from the application of this act or of any provision or provisions of this act". In some cases regulations can be made excluding whole classes of institutions from the provisions of the bill. I recognize that delegation to the government by parliament of the right to make and change definitions and details of the application of a law by regulation helps keep that law relevant in the light of changing practices in the market place, but it can also mean that this bill, after it is debated and voted upon, may later turn out to be far different both in form and application from what it is now, before the regulations are finally issued.
The bill does say that before any regulations made under it may be proclaimed in force there must be a reasonable time left to comment on them. That is, no doubt, worth while for groups and individuals in the private sector. But as far as parliament is concerned it cannot be a substitute for knowing the government's exact intentions on the important matters the bill proposes be left to be spelled out in regulations.


Some hon. Members:: Hear, hear!


Herbert Eser (Herb) Gray: I am referring, for example, to the level of the rate of the criminal rate of interest to which sanctions will apply, to the institutions and transactions to be exempt from the act, and the kind of information to be spelled out in advertizing in which credit is mentioned. I say that the government must table a complete set of draft regulations before the committee studying the bill at the outset of its hearings. There can be no meaningful parliamentary debate nor can there be meaningful public input as to the cohtent of the bill without these regulations being before us at the earliest date possible, which I say should not be later than the beginning of the committee hearings.


Some hon. Members:: Hear, hear!


Herbert Eser (Herb) Gray: The material distributed with the bill said it would permit the creation of a national base of data on consumer credit, but the minister in his speech made no reference to this aspect, nor does the measure before us explicitly deal with it. We should hear more about the government's intentions in this regard. How will this data base be created and operated? What does the government intend to do to ensure the right of privacy of borrowers and prevent anyone having access to information about a particular individual without that individual's consent? What will the government do to ensure that any individual can ascertain what information may exist in the data base about him and that any errors
November 2, 1976

will be quickly and fully corrected? More information on this is required.
My comments and questions have been raised in a constructive way with the aim of securing the best possible legislation for Canadian consumers. This is extremely important since, as has been pointed out, consumer debt has increased from $1 billion in 1947 to $23 billion at the present time and has come to represent 22 per cent of the total disposable income of Canadians. The importance of consumer credit is so great that, to use the words of the Prime Minister (Mr. Trudeau) when he announced the consumer credit plank in the 1974 Liberal election platform, "We feel it is vital to provide the utmost in protection and equity in the field of consumer credit." I believe the bill deserves support on second reading, but in allowing it to pass through the balance of the parliamentary process we must make sure that it does, in fact, provide "the utmost in protection and equity in the field of consumer credit".
Finally, Mr. Speaker, however much, in the words of Edward Fitzgerald in his "Rubaiyat of Omar Khayyam", one would like to "take the cash and let the credit go", the economy we have now, and which we are likely to have in the foreseeable future, does not make this possibility at all likely. Our duty, therefore, is to ensure that credit goes with, and not against, the best interests of all Canadians.


Some hon. Members:: Hear, hear!


William Hillary (Bill) Clarke: Mr. Speaker, as I rise to make my comments on Bill C-16 1 might be excused for feeling a little pity for the minister. It seems that in his new post he has not had a chance to get agreement from all members of his party over there. It is not often that I have to wait when 1 get up for applause for a member on the government side to die down.
I find it very strange, Mr. Speaker, in fact incredible, that a government that has allowed such high inflation as we have been experiencing in past years should be so worried, as it is now, about high interest rates. While being concerned with high interest rates we find that it has removed the ceiling on interest rates and replaced those ceilings with some unknown rates, to be included in some regulation to be promulgated at some unknown time.
1 listened to the minister telling us about his consultations. It is true that there were consultations, Mr. Speaker, but consultation to be meaningful has to be two way. 1 should like to refer to a letter from the Consumers Association of Canada in which they make reference to discussions with the minister held by several representatives from their association. I think it is significant that this letter is dated October 20, exactly one week before this bill was introduced by the minister in this House.
In their letter the Consumers Association of Canada make reference to several proposals that they want the minister to consider in drafting the legislation. The first matter they refer to is the ceilings. They favour retention of a graduated ceiling
Protection of Borrowers and Depositors on the cost of loans up to $7,500. They are also concerned that ceilings should be set at levels that realistically reflect the cost of lending money. With reference to the unwarranted rate, the Consumers Association has this to say:
We do not believe that the proposed provision involving an unwarranted rate concept and a seven times prime rate ceiling are adequate substitutes for explicit regulation of small loan rates.
Small loan rates have not been mentioned in any way in any of the material put out or in the ministers own remarks in this House. Apparently, judging from this letter, there was a discussion with the CAC and the minister about a rate, and presumably a seven times prime rate ceiling was mentioned by one side or the other. The prime rate in Canada today is 1114 per cent, so if we are to have an unwarranted rate seven times that, it does not take very long to calculate that this comes to 77 and some odd per cent interest, or nearly 80 per cent, as one hon. member has already mentioned tonight.
That may sound like a very high figure and the minister has not given us any idea what he plans to do in connection with the ceiling. It might be worth reflecting that the Small Loans Act, which will be repealed if this bill is passed, provided for a nominal rate of 24 per cent per annum. This act was last amended 20 years ago, in 1956, and I suspect that 24 per cent per annum in 1956 was roughly six times the likely prime rate at that time of approximately 4 per cent.
The Consumers Association goes on to suggest that the unwarranted rate system depends ultimately on the ability and willingness of those most likely to need protection to go to court. I will be saying something more about that in a few minuter, Mr. Speaker.
Another concern of the Consumers Association is disadvantaged borrowers. They express concern about the loan sharking problem and therefore favour inclusion of an absolute ceiling for legal interest rates. There is reference somewhere in the material to a criminal rate, but I have not been able to find the term "criminal rate" in the bill and certainly it does not seem to be defined there.
In discussing disadvantaged borrowers the Consumers Association says this:
In any case, the widespread vulnerability of low-income populations to credit difficulties is by now well known, and should therefore be made a priority target of government policy and program development.
The CAC also favours retention of licensing requirements for regulated lenders, subject to exemption of lenders already governed by existing or future federal or provincial licensing requirements. As we have heard from others in this debate, Mr. Speaker, the licensing requirements will have disappeared with the passage of this legislation.
Some of the other concerns mentioned by the CAC in its letter to the minister are civil sanctions; the definition of "credit transaction", which has not been clarified, Mr. Speaker; non-purchase money mortgages, to which they would like to see attached the right of prepayment without penalty; and finally in the field of federal provincial relations they recommend regular consultation between federal and provincial governments.	.

November 2, 1976
Protection of Borrowers and Depositors
What makes this letter all the more incredible, Mr. Speaker, is its final sentence to the minister, as follows:
I trust that you will be giving close attention to our views before introducing the new bill to parliament.
We know that hardly was the letter received by the minister that the bill was presented to parliament. One can only guess that the reason for the sudden introduction of this bill was the government's failure to have anything else of any meaning on the docket of this House.
To underline the disappointment of the Consumers Association of Canada at the ignoring of their recommendations, 1 should like to refer to their bulletin which is dated the day after the bill was introduced into this House. They have this to say:
It is clear that comprehensive credit legislation to deal with all types of credit transactions is long overdue ... And we warmly welcome those elements of the new bill which will help to provide greater protection to consumers who borrow and lend money.
They then express some severe reservations, such as the government's proposal to eliminate the limits on interest rates on small loans. They hope that these features will be amended when the bill is debated in parliament. They also consider that the bill allows consumers only limited means to obtain restitution for losses incurred as a result of illicit lending practices. They also make reference to the fact that this is a long and complicated bill.
This important group, the Consumers Association of Canada, is funded by this government in order to bring some ground level reports forward from the consumers of this country, who are the very people that the minister is proposing to help. There is no evidence that he has received any support from the very people at whom he has aimed this legislation.
As speakers on this side of the House have already said, we are in general agreement with the stated aims of this bill. In particular, the minister said that he wanted to protect Canadian borrowers. We could not agree with anything more. Secondly, the minister says he wants to provide more and better information on credit, which is another commendable and long overdue aim with which we totally agree. Further, he wants to eliminate unnecessary complexities and confusion in credit dealings, again extremely commendable, Mr. Speaker. He also wants to define uniform rules to protect borrowers and depositors. That also is fine. We have four important principles with which we are in total agreement.
These aims are given priority in the bill because consumer borrowing has increased at such a high rate, even considering the rates of inflation that have had to be overcome. For example, in 1950 the consumer credit figure given is SI.2 billion, or 10 per cent of personal expenditures. By 1974 consumer credit had reached $20.6 billion and amounted to 26 per cent of personal expenditures in that year. That did not include money borrowed on mortgages on individual houses and condominiums, which money was actually used not for the purchase of the real property but for the purchase of consumer goods. But frequently to borrow on a mortgage on a house is a cheaper way of borrowing than by the conventional financing
[Mr. Clarke (Vancouver Quadra).J
methods. On average, statistics show that every employed member of the labour force owed $2,250 in 1974.
Despite this dramatic change the Small Loans Act and the Interest Act have not been altered significantly, since 1956 in the case of the Small Loans Act and since 1917 in the case of the Interest Act. These bills remained substantially the same in spite of the Porter Commission of 1964 and the report on consumer credit in 1967 which showed the need for change. In 1975, just about one year ago, the then minister of consumer and corporate affairs said in a speech that there has been serious need for change for a long time.
There has obviously been a lot of thought in the past and it is nice to see that the government is taking steps to make some corrections. One could wonder whom one could blame for all this delay. It is interesting to note that since I was two years old we have had less than six years of non-Liberal government in this country. In other words, for 35 of the last 41 years we have had Liberal governments.


Some hon. Members:: Hear, hear!


Stanley Howard Knowles: You were born too late.


William Hillary (Bill) Clarke: I should add that it is likely to change very soon. I do not see how hon. members opposite can sit there and applaud the performance of this government.
1 want to deal with some of the complaints of a general nature which we might have in connection with this bill. First of all we find that the borrower is defined as a person or a closely held corporation with fewer than 15 shareholders. However, when we come to the mortgage clauses of this act, namely clauses 14 and 15, the definition of "borrower" is changed to exclude a closely held corporation. Many individuals band together to form corporations, for business dealings or whatever, and sometimes individuals have corporations and the home is owned by a corporation. These individuals will now be denied the rights given to individual borrowers.
The minister has made a big point about the right to pay-eff by individual borrowers, but all he has done under the new rules is to allow a complete pay-off of a mortgage after three years instead of five years. The individual borrower always had the right to pay off his loan in full after five years. There has been no change in the penalty payment required in paying off an individual's mortgage-it is still three months.
Another specific type of complaint is found in Clause 31 and it covers the regulations. It is stated that the governor in council may make regulations. We have heard about how many different times the regulations have been referred to in the bill, and 1 will not try to detail them all, but there are some glaring examples-about six here, I think-in clause 6, with regard to the form prescribed by the regulation, that the information must be filed in a form to be prescribed by the regulations, and the contents must be such information as is
November 2, 1976

prescribed by the regulations. That has regard to the relevant credit charge.
Clause 7 requires that the lender shall, in a manner and form prescribed, disclose to the borrower such information as is prescribed by the regulations. Here we are again asked to approve a bill which does not tell us the form or how the information should be filed, and it does not say what information is required to be filed. We wonder how one can comply with a statute that does not contain these details and how we can be asked to pass such a bill. In clause 18 we are told of the manner of providing statements to borrowers and that the fee prescribed is to be determined by regulation.
Clause 20 refers to the content of advertisements for deposit taking institutions which is to be set out by regulation. Clause 21 refers to regulations for a class of institution excepted from the bill, and the calculations must be in the manner prescribed by the regulations as well as the intervals which are to be prescribed by the regulations. Finally under clause 31 we find that the governor in council may exempt any class of lending transactions from the act.
There are so many holes there that one really does not know what kind of thing we are asked to pass. We have a bill with unspecified maximums and an unspecified criminal rate of interest. We find that the borrower has to take after-the-fact action which is really quite ineffective, too indefinite, and nobody knows where he stands on various transactions.
The hon. member for Windsor West (Mr. Gray) commented on the problems a borrower might find if he has to go to court. The bill is absolutely silent on legal costs, and I imagine there would be very few borrowers who would be willing to take a chance in a court on further burdening themselves with high legal costs as well as interest rates they have been called upon to pay. I think the hon. member for Windsor West made the problem quite clear with regard to the average small borrower and his dealings with the courts. When we had the small loans provisions, the 24 per cent was spelled out in the act and it worked well for the few years it had before it was finally repealed. Even then the ceiling was $1,500, and all that did was to encourage the people who were unwilling to get involved with the small loans regulations to increase the amount of their loans to over $1,500. The figure often seen was $1,525. May I call it ten o'clock, Mr. Speaker?


BUSINESS OF THE HOUSE
Mr. Paproski:: Mr. Speaker, I rise on a point of order. I wonder if I might ask the acting government House leader or the deputy House leader for the House business tomorrow and for the balance of the week.


Ralph Goodale: Mr. Speaker, we intend to continue with Bill C-16 until the debate is completed. 1 gather from the number of hon. members who still wish to speak on the subject on both sides that we are not likely to finish that subject tomorrow, although we might. If we do, we would then move on to
Adjournment Debate
government order No. 5, the legislation relating to currency and exchange. After we have concluded that, we would likely take a look at government order No. 4 relating to land surveys, and following that to government order No. 7 relating to fishing and recreational harbours. Our primary intention will be to continue with Bill C-16 until second reading stage is completed.



PROCEEDINGS ON ADJOURNMENT MOTION

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

John Allen Fraser: Mr. Speaker, in the few minutes that 1 have available I want to remind all hon. members that early in 1973 questions were raised in the House by members of this party, myself included, concerning a proposed expansion of Vancouver Airport which consisted primarily of the building of a new runway which would be closer by a considerable distance to the heavily built up portion of Vancouver and which would extend into the estuary part of the Fraser River, which is an important salmon resting area for young fish having come down the Fraser River and before going into the Pacific Ocean. The two immediate problems were pollution, first of the water, and the second of noise for those people affected by the new runway. There are the other problems of how this would affect the entire area.
Eventually the government of the day agreed to establish an airport planning committee to study this entire issue. That was established early in 1973 and the report came down in March, 1976. The result of the deliberations of that planning committee, which included members of the Vancouver regional government, interested people in the aviation industry, the Department of Public Works, the Department of Transport, the Department of the Environment, the Department of Urban Affairs, The Community Forum, the City of Vancouver and the greater Vancouver regional district, was that there was a split decision, but the majority was for not proceeding with the airport expansion because a case had not been made for it by the Ministry of Transport. The issue was whether or not a long runway, which would extend into the estuary, should be built.
Subsequent to the report of the airport planning committee the then minister of the environment said that perhaps we could have a shorter runway which would not extend into the estuary. On March 7, 1976, the Minister of Transport (Mr. Lang) issued a press release in which he said:
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November 2, 1976
Adjournment Debate
A federal government decision is expected to be made within the next few months and all interested parties are asked to present their views to the minister as soon as possible.
In the press release the minister did not set out what kind of a proposal was now being looked at, but it became very clear that the minister had decided to take the decision making from the airport planning committee and make his own decision in the secrecy of his own office as to whether or not, first of all, there ought to be any new runway, and second, what kind of runway it ought to be. Subsequently in the House the minister was asked on several occasions in recent weeks just what was going on.
On October 25, as reported at page 402 of Hansard I asked the minister if he would advise the House at what stage were the deliberations concerning the so-called third runway at Vancouver International Airport. The minister replied that some further studies of an environmental nature were seen as necessary before any final decision was taken. Then the minister went on to say a most extraordinary thing. He said that 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 asked the minister if this meant that the decision had in fact been made to go ahead with the new runway and he said no, that it did not mean that. Then on November 1 I asked the minister again if he could tell us what was happening with regard to the situation, especially in view of the fact that an environmental panel had been selected in July this year but had apparently been disbanded. The minister did not know what the reference to that environment panel was and said:
My view is that the panel that is to be, is still to be and there will be an announcement on that in due course.
It is extraordinary that on September 18 a member of his department spoke to the citizens' group in Vancouver and answered certain questions. He was asked whether an environmental panel had been established and was asked the date and formation of the original panel. He answered that that was in July of this year. He was asked this question:
Was there actually a specified membership of persons on the panel?
He answered:
Yes there was a list drawn up and a panel meeting actually was held, as a first go-around to inform the panel members what it was all about.
He then went on to say that the panel was disbanded and has no longer any standing.
There are certain questions which arise out of this. The events are well known in the city of Vancouver, British Columbia, and there are certain questions which demand answers. First, why has the minister circumvented the planning and review process established three years ago under the airport planning committee which involved the federal government, the local government, the greater Vancouver regional district, the city of Vancouver, and the citizens of the affected area? The second question is what happened to the representations, if any, which the minister invited from the public in his press release of March 12, 1976? Are we ever going to see them?
The third question is just how could anyone comment on a proposal when no details of the proposal-or proposals-have ever been given to anyone? In other words, we have no details as to what it is the minister is in fact studying. The fourth question is why did the minister say in his press release of March 12, that, and I quote, "a decision would be made in the next few months"? It is now eight months later, and all is confusion.
The next question is why has the minister refused, since March, 1976, up to now to tell us what proposal is being considered? Is it a long runway into the estuary or only a short runway within the dyke? Sixth, will the minister refer the proposals under consideration, whatever they are, back to the airport planning committee if the proposals he is considering are different from those already studied by that committee? Presumably there must be some difference, or the minister would not be talking about further studies or comments. The next point is that if no decision has yet been made-


Mr. Deputy Speaker:: Order, please. I have to stop the hon. member because his seven minutes have expired.


Mr. Marcel Roy (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, in reply to the hon. member for Vancouver South (Mr. Fraser) I think it is necessary, in order to understand fully what is now taking place with regard to a third runway at Vancouver International Airport, to review some of the recent history of the project.
In 1973 the Ministry of Transport came to the conclusion that a runway parallel to the existing east-west runway was needed at Vancouver International Airport. Terms of reference for an airport planning committee were established, and the first meeting was held in April, 1973. The terms of reference were "to ensure that the proposed development of Vancouver International Airport was compatible with the planning of the various levels of government and the concerns of the public in the communities involved".
Several planning studies were carried out under the supervision of various subcommittees of the airport planning committee. The studies resulted in ten reports, all of which were completed and printed at various times in 1975. During the course of the planning and environmental studies, alternative concepts for a parallel runway were considered, all of which involved extensions past the dyke and into the estuary.
The report of the airport planning committee was printed and made available to the public in March of this year, and the airport planning committee was dissolved. At about this point in time we arrived at the conclusion that instead of implementing one of the concepts involving extension into the estuary we should construct a shorter runway-of approximately 10,000 feet-which could be located entirely within the dyke and which would involve no protrusion into the estuary. We have taken the position that this third runway should not be started before 1978 and that this project is subject to the environmental assessment and review process of the federal government.
[Mr. Fraser.)
November 2, 1976

We have asked that officials of Environment Canada establish an environment assessment panel to review the third runway project. These officials now are considering our request, and we expect a response in the near future.
Adjournment Debate


Mr. Deputy Speaker:: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 2 p.m.
At 10.12 p.m. the House adjourned, without question put, pursuant to Standing Order.
80001-461/2

Wednesday, November 3, 1976