1977-05-20

ROUTINE PROCEEDINGS


Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, I rise under Standing Order 43 on a matter of urgent and pressing necessity. With the Montreal International Airport at Mirabel losing over $56 million per year and with airports such as Logan at Boston actively advertising in Canadian journals their convenient service in contrast to Mirabel, and in view of the fact that in the Toronto area the government has tied up
18,000	acres of prime farm land at Pickering in anticipation of constructing a further white elephant while aircraft movements at Malton have increased only 2 per cent in the last five years, I move, seconded by the hon. member for High Park-Humber Valley (Mr. Jelinek):
That the government make a suitable reference to the Standing Committee on Transport and Communications to investigate and make recommendations on the operation of Mirabel airport at Montreal and the proposed Pickering airport at Toronto.


Mr. Speaker:: Presentation of such a motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


IMMIGRATION
Mr. Stuart Leggatt (New Westminster):: Mr. Speaker, I rise under the provisions of the same order. In view of the fact that Mr. Pedro Denegri has exhausted all avenues of appeal against deportation to Chile, and in view of the evidence that Mr. Denegri has been tortured in Chile previously by the military junta and could face execution if he is returned to that country because of his involvement with the previous Chilean regime, I move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House directs the Minister of Manpower and Immigration to permit Mr. Denegri to remain in Canada on humanitarian grounds.


Mr. Speaker:: Presentation of such a motion pursuant to Standing Order 43 requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


CRIMINAL CODE
Mr. Dean Whiteway (Selkirk):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. In light of the advertisement appearing in the Ottawa Journal of May 9, 1977 which reads in part as follows: "Legal abortions on demand. Near Ottawa .. . same day ... on demand (same day by certified gynecologists)", and in recognition that this is clearly in violation of section 251 of the Criminal Code, I move, seconded by the hon. member for Winnipeg South Centre (Mr. McKenzie):
That this House direct the Minister of Justice to contact immediately all provincial Attorneys General in order to co-ordinate legal action against such flagrant violations and misrepresentations of the Criminal Code.


Mr. Speaker:: Presentation of such a motion pursuant to Standing Order 43 requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.

[DOT] (mo)


ENVIRONMENTAL AFFAIRS
Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43. In light of reports that the move of 15,000 civil servants to the city of Hull will generate
30,000	more flushes per day of raw sewage into the Ottawa River, and since it is reported that Hull does not have secondary sewage treatment plants, I move, seconded by the hon. member for Ottawa-Carleton (Mrs. Pigott):

That this House instruct the Minister of the Environment to determine whether or not Hull has the proper sewage treatment facilities and if not to order a study to determine the environmental impact on the Ottawa River of 30,000 more flushes per day of raw sewage.


Mr. Speaker:: Presentation of such a motion can be done only with the unanimous consent of the House under the terms of Standing Order 43. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



LABOUR CONDITIONS


Mr. Otto Jelinek (High Park-Humber Valley):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity dealing with the unfair practice within the present work-sharing programs of certain unions. Contrary to the statement of the Minister of Labour regarding this work-sharing program, it has come to my attention that a great number of unions, including the UAW, are indeed making it obligatory for their membership to work beyond the number of prescribed hours in a working week, thereby curtailing considerably potential work opportunities for tens of thousands of unemployed, many of whom already have had extensive experience in their respective fields. Therefore, for the sake of an equitable and fair work-sharing program, I move, seconded by the hon. member for Hamilton West (Mr. Alexander):
That this House instruct the Minister of Labour to acquaint himself forthwith with this unfair practice and take any necessary action in order to rectify the work-sharing problem now being faced by a great number of unemployed.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



METROPOLITAN AREA GROWTH INVESTMENTS


Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I rise on a matter of urgent and pressing necessity pursuant to the provisions of Standing Order 43. In view of the unsatisfactory and even ludicrous efforts put forth by Metropolitan Area Growth Investments, that hybrid Crown corporation founded five years ago and funded by the federal government and the province of Nova Scotia with $20 million of taxpayers' money,

May 20, 1977
I move, seconded by the hon. member for York-Simcoe (Mr. Stevens):
That the Minister of Regional Economic Expansion take whatever steps necessary to investigate thoroughly and report back to the House of Commons before June 30 on the role of the junior partner in this arrangement, the government of Nova Scotia, with respect to the undue delay occasioned by the insistence of Premier Regan on using appointments to the agency as a pork barrel, and the incompetence demonstrated to date by Mr. Scott MacNutt and other executives in, among other things, purchasing for several million dollars a second-hand cruise ship registered offshore to promote the best interests of Nova Scotia.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



REQUEST FOR STATEMENT BY MINISTER ON POSSIBILITY OF SWINE FLU VACCINATION PROGRAM-MOTION UNDER S.O. 43

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 reported probable swine flu death two days ago in South Carolina, and in view of the fact there is plenty of vaccine left over from last year, I move, seconded by the hon. member for Brandon-Souris (Mr. Dinsdale):
That the Minister of National Health and Welfare state on motions whether it is his intention to have another national swine flu vaccination program this year.


Mr. Speaker:: For the presentation of such a motion for debate, Standing Order 43 requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, again my question is for the Acting Prime Minister. He will remember yesterday I brought up the matter of the media revelations respecting one Jose Ben Gelbard, an ex-minister in the government of Argentina, who is alleged to have been the prime recipient of Canadian taxpayer's money in respect of an AECL Argentine CANDU reactor pay-off.

May 20, 1977

Almost unbelievably, and I say that most advisedly, the Acting Prime Minister and his cabinet colleagues who were in the House indicated that they knew nothing of that report yesterday. He indicated as well that he would take up the matter immediately and I presume call for immediate reports from his colleague, the Minister of Energy, Mines and Resources, the Department of External Affairs and the Department of the Solicitor General in regard to the RCMP investigation into this matter. That is what the Acting Prime Minister undertook yesterday in the House. I ask him to fulfil his commitment now. What has been done, what does he know about it, and can he verify these reports?


Hon. Allan J. MacEachen (Acting Prime Minister):: Mr. Speaker, in reply to the hon. gentleman, may I say 1 have asked for further information on the question. The Department of External Affairs has put into place an investigation in an effort to verify these allegations. On the surface, there appear to be considerable discrepancies in the reports, but I am not in a position to go into any detail. With respect to the Department of the Solicitor General, I understand that the RCM Police are still investigating these matters. I have no further comment to make. The Minister of Energy, Mines and Resources is in the chamber and he may wish to add to or subtract from that answer.


Allan Frederick Lawrence: Mr. Speaker, my supplementary has to be to the Acting Prime Minister again in view of the obvious apathy that his ministerial colleague is showing in not rising in his place in this House. Obviously, the government believes or hopes that if there is no further reference to this matter, it will quietly disappear from the scene. I can assure them it is not going to disappear from the scene. Twenty-four hours ago the minister made a commitment to this House that he would indicate what he and the government are doing about this matter and to verify or comment further on these reports. That report has been available to the minister and the government for at least four days. The Financial Post is published on Monday or Tuesday of each week. It has been available here in Ottawa. It has been on the wire services. The continued evasion of the government in this matter is something that is abhorrent to us all.


Mr. Speaker:: Order, please.


Allan Frederick Lawrence: My further question to the minister is simply this. Is he going to make any further comment other than the piddling remarks he has made on this matter today in the House?


Allan Joseph MacEachen: No, Mr. Speaker, not in reply to the rather intemperate outburst of the hon. member.


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


SALE OF CANDU REACTOR TO KOREA-ALLEGEDLY MISLEADING STATEMENTS ON SERVICES PERFORMED BY MR. EISENBERG
Elmer MacIntosh MacKay: Mr. Speaker, my question is to the Minister of Energy, Mines and Resources. In view of the seriousness of the possible misuse of millions of dollars of taxpayers' money related to sales of CANDU reactors and with regard to the Korean situation, is the minister now sufficiently well briefed to acknowledge that he has misled members of this House on different occasions by saying that Korean officials who disputed the statements that Mr. Eisenberg and his company did not appear to have performed any tangible services as agents were not, to use his words, there at the time. Now that he has had some time to think it over, does he wish to change his answer?


An hon. Member:: Come, on, tell him!


Hon. Alastair Gillespie (Minister of Energy, Mines and Resources):: Mr. Speaker, we apparently have somebody else who is prepared to answer the question.


Some hon. Members:: Oh, oh!


Elmer MacIntosh MacKay: Mr. Speaker, this is an important question. In view of reports from responsible people in the Korean Atomic Research Agency and the Korean Electric Company that there does not appear to be any tangible evidence that Mr. Eisenberg could justify the millions of dollars received, not having hired one Korean national or done anything to justify the moneys which apparently have been transferred to him, will the minister stop evading this important matter, pick up the telephone and call the liaison office of the Korean Electric Company at 282-9680 in Montreal so that he can, at least, satisfy himself how little he knows of what he has been saying in the House?


Some hon. Members:: Hear, hear!


Alastair William Gillespie: Mr. Speaker, I think it might be worth making just one comment. There seems to be an effort on the part of members opposite to try to make a major political issue out of the investigation.


Some hon. Members:: Oh, oh!


Alastair William Gillespie: I suggest to them they would serve the people of Canada better if they were to look at the evidence and to deal with the people who are in a position to give detailed answers, the people who are appearing before the Public Accounts committee; that is what the Public Accounts committee is for. Second, it seems strange that a former attorney general of the province of Ontario should suggest to us, at a time when there is an RCMP investigation going on, that we should in some way or another interfere with or intervene in that investigation. He knows perfectly well that the investigation is under way, and until the RCMP has something to report we have nothing to report either.
5838

May 20, 1977
Oral Questions


Elmer MacIntosh MacKay: Mr. Speaker, the minister should note that so far this House has received nothing more than the third-hand information of a former chairman of the Korean Electric Company upon which all these high sounding statements are based, and without interfering or doing anything to impede the RCMP investigation will the minister not take the most rudimentary interest in what is going on and tell this House some of the facts which we are entitled to know?


Mr. Speaker:: The hon. member for New Westminster.


ENVIRONMENTAL AFFAIRS
Stuart Malcolm Leggatt: Mr. Speaker, my question is directed to the government House leader in the absence of the Minister of the Environment. The United States announced this week that it is going to delay the sale of any leases in the Beaufort Sea until 1979. Would the minister advise the House whether he and the cabinet are aware of the factors which led to the delay in terms of U.S. leases in the Beaufort Sea? If he is not aware of what they were, will the cabinet be aware of them before the decision to redrill under our own program is made? Will the House be made aware of the factors which led the United States to delay its decision on Beaufort Sea leases?


Allan Joseph MacEachen: Mr. Speaker, 1 think the hon. member is making a reasonable request, and I will attempt to see that it is fulfilled.


DRILLING IN BEAUFORT SEA-NEGOTIATIONS WITH UNITED STATES FOR COMPENSATION IN EVENT OF OIL SPILL
Stuart Malcolm Leggatt: Mr. Speaker, the United States has expressed concern to the Canadian government about the potential for damage in its own Beaufort Sea area as a result of prospective drilling by Canada. Can the minister now bring the House up to date as to the state of the negotiations or what agreements there are with the United States in terms of compensation to the United States in the event of spills in the Beaufort Sea as a result of our drilling program?


Allan Joseph MacEachen: Mr. Speaker, I know that prior to the first authorization for drilling there was considerable consultation with the United States in an effort to deal with whatever concerns that government had on environmental questions. These were very much in our minds and were taken into account in the circumstances which surrounded the drilling. With respect to the question of compensation, I would have to seek some information on that.


DRILLING IN BEAUFORT SEA-PROPOSED CONFERENCE OF CIRCUMPOLAR NATIONS ON ENVIRONMENTAL EFFECTS
Stuart Malcolm Leggatt: Mr. Speaker, one of the recommendations which was made in the Berger report dealing with the Beaufort drilling program was that Canada call together the circumpolar nations in an international conference. Before we destroy the Arctic we should at least talk to some people about how we can go about cleaning it up. 1 am wondering if the minister can advise the House whether that particular recommendation in the Berger report is now before cabinet and when we will receive a decision from the government in terms of that specific recommendation, that is, the calling of a circumpolar conference of all the polar nations around the Arctic so that we can make sure we do not do anything to the climate of this planet with oil spills in that sensitive area.


Allan Joseph MacEachen: Mr. Speaker, I have already stated on behalf of the government that we have taken and are taking the Berger report very seriously indeed. All aspects of it are under consideration at the present time, but in general we will not be making decisions on the recommendations of the Berger report until further information is available to us, including the report of the National Energy Board, the report of Dean Lysyk, which is expected on August 1, and the findings of the environmental panel. That is the general situation. I have had no indication that the Minister of the Environment has decided to call, in advance of those general decisions, a conference of the circumpolar nations, although it is obviously a matter of interest to the government and may very well be a proposal which can be acted upon.


ROYAL CANADIAN MOUNTED POLICE
Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, my question is directed to the Solicitor General.
During the first mandate of the Bourassa government in Quebec, the then Minister of Justice, Mr. Choquette, made representations to the federal government with a view to obtaining compensatory payments from the central government in lieu of the services given by the RCMP in the other provinces. Now, with the advent of the new government in Quebec and in view of the news that Quebec intends to have its own service, to be known as the Surete Nationale can the minister tell the House whether he has had talks with the Quebec Minister of Justice with regard to that RCMP file, and also tell the House what progress has been made in that connection?


Hon. Francis Fox (Solicitor General):: Mr. Speaker, since the dates mentioned by the hon. member and in the last few months I have had occasion to answer that question as put by
May 20, 1977

some of the colleagues of the hon. member, and 1 must say there have been no changes in the federal government policy since then. In answer to the specific question as to whether I have had talks with the Minister of Justice on the matter, the reply is no, Mr. Speaker. 1 should like to point out to the hon. member that a federal-provincial conference of justice ministers and ministers responsible for the penal sector will be held in Ottawa starting on June 27 next. Of course, at that time I intend to meet the Quebec Minister of Justice and discuss a whole series of problems.


Joseph Adrien Henri Lambert: Mr. Speaker, on a supplementary.
As, according to what he says, the minister intends to bring up the matter again at that conference, can he tell the House whether he will have specific proposals to put to the Quebec government in order to solve that matter so that the two parties, Quebec and Ottawa, can be relieved of that burden?


Francis Fox: Mr. Speaker, I decidedly must have expressed myself poorly in my answer to the hon. member. A federal-provincial conference will be held starting on June 27 next. The matter he mentions is not on the agenda. It has already been taken up at the provincial and federal solicitors general level. No agreement was reached and, later on, the matter was entrusted to the first ministers at their conference. Moreover, the position of the federal government on the matter has been expressed definitively by the Prime Minister of Canada.


EFFECT OF PROGRAM IN PRINCE EDWARD ISLAND TO REDUCE COST OF ELECTRICITY
Mr. David MacDonald (Egmont):: Mr. Speaker, my question is directed to the Minister of Energy, Mines and Resources. The minister may recall that when he appeared before the Standing Committee on National Resources and Public Works on March 8 he indicated that he has been trying to cushion the consumers of Prince Edward Island against high energy costs. 1 think he is well aware of the very great cost differential between Prince Edward Island and say, his hometown of Toronto-something like 300 per cent. Can the minister indicate the extent to which the program introduced around Christmas last year has had any impact in terms of reducing the cost, particularly on those most directly affected on the production side such as in agriculture, especially dairying, where there has been a high demand for electricity? As the minister well knows there is no direct relationship between the electricity costs factor and the insulation program that he announced earlier.


Alastair William Gillespie: Mr. Speaker, it is too early to give the hon. member a quantitative response to his question but I can say
Oral Questions
that inquiries I made as recently as a week ago indicated that the program was an outstanding success.


David Samuel Horne MacDonald: A supplementary question. I hope the minister will be able to back up his self-congratulatory adjective of "outstanding" with some real statistics, particularly in the area of the cost disadvantage of our major industries. Here again I am thinking of agriculture where there is a very real burden in terms of high electrical costs. I wonder if the minister has conferred with the Minister of Regional Economic Expansion to learn in particular of any firms that have been unable to locate in Prince Edward Island specifically as a result of prohibitive electrical costs in that province?


Alastair William Gillespie: Mr. Speaker, I would be very pleased to take the hon. member's suggestion and talk to my colleague about the inhibiting effects of high electrical cost on industry in Prince Edward Island. Going back to my earlier answer, when I said it was an outstanding success I think any program which has a response of better than 25 per cent of households within six weeks of its initiation has to be regarded as a very successful program.


RELATIONSHIP BETWEEN LOW PERCENTAGE OF HOMES IN PRINCE EDWARD ISLAND USING ELECTRICAL HEATING AND INSULATION PROGRAM
David Samuel Horne MacDonald: A final supplementary question, Mr. Speaker. I am afraid that the minister is engaging in his old apples and oranges exercise. Could he clarify for the House soon, if he cannot do it today, the actual impact of those insulation programs on use of electricity inasmuch as few, perhaps less than 5 per cent, of all homes on Prince Edward Island use electricity for heating purposes? Can he indicate how those two figures can relate to one another? The relationship certainly is not apparent to those who are directly affected by the highest electrical costs in the country, in Prince Edward Island.


Alastair William Gillespie: Mr. Speaker, 1 am sure the hon. member is aware that the government looked at the energy costs of the household and at the best way of cushioning those additional energy costs which are associated with the high cost of electrical generation, and came down in favour of an insulation program, a program which I understand the hon. member supports.


STUDY OF INTEGRATION OF ELECTRICAL GENERATING
Hon. Robert L. Stanfield (Halifax):: Mr. Speaker, I direct a supplementary question to the Minister of Energy, Mines and Resources. My question concerns what he proposed some time ago, namely, that there should be a total revamping of the electrical generation system of the Maritime provinces and particularly that there should be integration and a resorting to large units. How is the minister coming along with this study?
80016-29/4

May 20, 1977
Oral Questions
Where is it? When are we going to get answers from the minister as to what is going on, or are we to talk another year about more studies?


Alastair William Gillespie: Mr. Speaker, 1 think a great deal of progress has been made. As the hon. member knows, the three Maritime provinces joined with the federal government in announcing the principles underlying the Maritime energy corporation. The work being done now is with respect to refining the nature of the role of such a corporation.


Robert Lorne Stanfield: A supplementary question, Mr. Speaker. Work on refining the role of such a corporation will not do much to reduce electric power rates in the Maritime provinces. 1 ask the minister, when are we to see something tangible, something concrete? When will we see some decisions taken, decisions along the lines the minister suggested should be taken? Can the minister stop talking in general terms about all this progress he sees being made? If it is not appropriate to make a statement during the question period, could he at some other time make a statement on a matter of such vital importance to the economy of the Maritime region? Where are we at? Where is the minister at? Where are the provinces at- quite apart from all this big talk about progress?


Alastair William Gillespie: Mr. Speaker, we are at present trying to establish a Maritime energy corporation which will bring significant future benefits to the people of the Maritimes precisely because those who were formerly in positions of power in the Maritimes, provincial premiers in particular, were not long-sighted enough to see the problem which would confront us.


Mr. Alexander:: Oh, come on!


Robert Lorne Stanfield: A final supplementary question, Mr. Speaker. The minister is showing how little he knows about these problems.


An hon. Member:: Right on.


Robert Lorne Stanfield: The integration took place as recommended by the federal government and agreed to by the provinces. Will the minister tell me, frankly, whether agreement has been reached about a further stage of integration, or will the minister try to keep taking us down this long garden path he has been on for the last year?


Alastair William Gillespie: Mr. Speaker, if those who were in the position some years ago to form such a corporation thought it was such a good idea, why was the corporation not formed? Clearly it has taken a good deal of time to gain the support of the three Maritime premiers for the formation of such a corporation, and to convince them that such a corporation is important for the future of their area. We have tried to do this in the last year. Clearly, when one deals with three Maritime premiers, each of whom has a slightly different view of what is important, it takes time to work out the details. We have done
[Mr. Stanfield.)
more in the last six months with respect to this question than was done, I think, during the last 15 years.


FUNDY TIDAL POWER PROJECT-ALLEGATION FEDERAL GOVERNMENT DELAYING PROGRESS-MINISTER'S POSITION
Mr. Robert C. Coates (Cumberland-Colchester North):: Mr. Speaker, my supplementary question to the Minister of Energy, Mines and Resources relates to the energy resources of the Maritime area and the strong attack made in the Nova Scotia Legislature on Monday on the minister and the assistant deputy minister who is the chairman of the Fundy Tidal Power Review Committee. The premier accused the assistant deputy minister of delaying significantly the progress which he desired in that area. What is the minister's reaction to that? I ask this in view of the comments he has made about the degree of co-operation being developed with the three Maritime premiers.


Mr. Muir:: The minister has not been talking to Regan.


Alastair William Gillespie: Mr. Speaker, the hon. member knows that I do not speak for the Premier of Nova Scotia. The Premier of Nova Scotia of course has his own views which are peculiar to himself. I do not happen to agree with him one little bit on that particular view.


CANADIAN BROADCASTING CORPORATION
Mr. Eymard Corbin (Madawaska-Victoria):: Mr. Speaker, my question is directed to the Secretary of State.
Since approval and authorization have been granted by the CRTC to the CBC to buy CJBR-TV stations in Rimouski and Edmunston, New Brunswick, and the CRTC decision has been made public three weeks ago, would the minister tell us why the government has not yet approved this decision and when the citizens of the republic of Madawaska will have the first French quality service in television broadcasting throughout the territory, which also allow for the simultaneous inauguration of the intraprovincialization of the French service in New Brunswick?


Hon. John Roberts (Secretary of State):: Mr. Speaker, as the hon. member knows, because he arranged the meeting, 1 have met with constituents of his area and cannot help being aware of the considerable desire of people in his area to have these services confirmed and extended. 1 am sympathetic to that view and would like to do everything I can to make it possible. This whole complex question is under study and 1 hope to be able to give some indication soon as to what the result will be. I share the hon. member's concern but cannot give him a specific assurance at this time.
May 20, 1977


FINANCE
Sinclair McKnight Stevens: Mr. Speaker, my question is for the Minister of Finance. As President Carter's economic adviser, Mr. Charles Schultze, has set for the United States a target of a budgetary surplus between $25 million and $30 million to be reached by 1981, the attainment of which target Mr. Schultze states could lead to reduced taxes, would the Minister of Finance say when he expects this country to reach the position of a balanced budget, bearing in mind that our current budgetary deficit is some $7.2 billion?


Hon. Donald S. Macdonald (Minister of Finance):: Mr. Speaker, we have debated in this House and in committee the wisdom of setting long-term goals of that kind since, inevitably, events both external to this country and internal can make them difficult to reach. I would have to say that 1 would not anticipate being able to bring the budget on a national accounts basis into balance for the next several years. I certainly would not attempt to make any prediction that by a specific year this would come about. It seems to me that the uncertainties involved in the international economy are such that I admire Mr. Schultze's courage in that regard, but perhaps question his judgment in being so precise.


DATE WHEN THERE WILL BE A REDUCTION IN LEVEL OF UNEMPLOYMENT
Sinclair McKnight Stevens: Again to the Minister of Finance. I hope that in reply to this question he will be more precise. As Mr. Schultze anticipates that employment in the United States will fall to 4% per cent by 1981 from its present level of 7 per cent in that country, would the minister tell us whether he foresees a similar fall in our own unemployment level, presently 8.3 per cent?


Donald Stovel Macdonald: I anticipate there would be a gradual reduction over the next several years, but obviously the principles governing my previous answer would apply to this question as well.


OBJECTIVE WITH REGARD TO JOB CREATION
Sinclair McKnight Stevens: The United States administration has accepted the challenge which, I take it, was thrown out at the London economic conference, and has established job creation as being the number one priority, indicating it would try to create ten million jobs, mainly in the private sector, by 1981. Would the minister indicate the objective of the Canadian government with respect to job creation? Is there a target with respect to the number of jobs to be created by 1981 ?


Donald Stovel Macdonald: The hon. fnember would do well to read both my previous answers.
Oral Questions HEALTH


PROSTHETIC SERVICES FOR VETERANS-GOVERNMENT ACTION TO IMPROVE
Mr. Jack Marshall (Humber-St. George's-St. Barbe):: Mr. Speaker, my question is for the Minister of National Health and Welfare. In view of the fact that veteran amputees have expressed the opinion that the quality of prosthetic services in the Department of National Health and Welfare has fallen behind that of private industry in the field of technical advances and new hardware, and since the veteran sometimes finds that the prosthetic device most suitable to his needs is unavailable to him, would the hon. gentleman tell us what assurances he can give to veterans of Canada that improvements will be made?


Hon. Marc Lalonde (Minister of National Health and Welfare):: For some time now, the Minister of Veterans Affairs and myself have not been very satisfied with the prosthetic services provided by my department in this regard. Discussions have been held with officers of the War Amputees of Canada on this subject. The result of these discussions was a recommendation to cabinet which has been approved whereby the federal government will limit its role mainly to one of co-ordination and consultation; the operational responsibilities will be transferred to other agencies, private or public. Consultations with the provincial authorities will continue regarding health services and workmen's compensation boards. I would be happy to ask my officials to give further details on this subject to the hon. member at his convenience.


URBAN AFFAIRS
Mr. F. Oberle (Prince George-Peace River):: Mr. Speaker, my question is to the Minister of Justice. I should like to ask him under what authority he has recently announced the expenditure of $6 million on public works projects for the City of Vancouver and by what authority he has taken it upon himself to allow the hon. member for Vancouver-Kingsway and the hon. member for Vancouver East to make further announcements of public works projects in respect of which we cannot seem to be able to find anything within the estimates of any department now before the various estimates committees.


Hon. Ron Basford (Minister of Justice):: The announcements to which the hon. member has referred concerning projects which will be of immense benefit to the citizens of Vancouver-


An hon. Member:: And to you!


Stanley Ronald Basford: I am interested to hear the comments of hon. members opposite who do not seem to like to hear about improvement in Vancouver. Anyway, they were announced on

May 20, 1977
Oral Questions
behalf of the minister responsible, the Minister of State for Urban Affairs, on the authority of the Treasury Board.


Frank Oberle: In the light of the fact that the projects commissioned by the minister from Vancouver have been subjected to the scrutiny of the ratepayers of the city of Vancouver recently and have not been approved by them, I ask the minister by what authority other cities can apply to the Treasury Board for projects such as fish markets and swimming pools? Does the minister not agree with me that this is a smelly situation and the worst kind of political patronage ever perpetrated on this country?


Stanley Ronald Basford: I answered the first question because it was directed to me and had to do with the authority on which the announcements were made. I answered on behalf of my colleague. I think the rest of the question properly relates to the administrative responsibility of the Minister of State for Urban Affairs, and he should answer it. Obviously, neither I nor the government can accept the premise of the hon. member's question.


TRANSPORT
Mr. Bill Jarvis (Perth-Wilmot):: Mr. Speaker, my question is addressed to the Minister of Transport to whom I put certain questions last Wednesday inquiring what information, statistical and otherwise, he has available to him concerning the risk of oil spills, having regard to increased tanker traffic both to existing ports and to proposed new ports on both coasts. The minister replied that he was that day tabling an emergency plan and a report. Mr. Speaker, if the hon. gentleman has no statistical information indicating the risk factors from spills resulting from increased oil tanker traffic to existing ports and to proposed ports such as Kitimat, how can he judge the value of those reports?


Hon. Otto E. Lang (Minister of Transport):: The hon. member persists in relating the answer to the second part of this question to the first part. I was saying that the information we had was, by and large, of an internal working nature. The hon. member asked whether it was suitable for tabling. I am not at all sure that it is. We are developing positions in anticipation of an international conference on the conditions which might be imposed across the world in relation to tankers. An analysis of risks and costs would obviously be involved in that exercise. But I do not for the moment have this information in a form which can be tabled.


William Herbert Jarvis: About two weeks ago the Minister of the Environment made available to us a report which his environmental officials said was the best information available on oil blow-out risks, even though this was a complex and technical subject. Is the minister telling us now that the internal documents to which he referred are so complicated and so far

beyond the possibility of comprehension by the public and by members of this House that he is not making them available for that reason?


Otto Emil Lang: Not at all. As soon as the material can be made available in a form which represents the conclusion of work rather than the middle of work, it will be made available.


INCOME TAX
Mrs. Jean E. Pigott (Ottawa-Carleton):: Mr. Speaker, I have a question for the Minister of National Revenue. It concerns her recent announcement of an agreement between federal and Quebec authorities to reduce tax deductions from federal employees residing in Ontario but working in Quebec. What form did this agreement take, and will the minister table this document?


DISCUSSIONS WITH UNITED STATES ON INTERNATIONAL WHEAT AGREEMENT-POSSIBILITY OF AGREEMENT ON PRICE
Mr. Jack Murta (Lisgar):: Mr. Speaker, I would direct my question to the minister responsible for the Wheat Board since the Minister of Agriculture is not here today. It concerns an international wheat agreement which the U.S. Secretary of Agriculture was discussing with the minister in Ottawa. I should like to ask the hon. gentleman whether the two governments have reached any agreement or conclusion with regard to the minimum price they would like to see for world wheat stocks. If they have not come to a conclusion as far as price is concerned, what is holding them back and when will further negotiations and discussions take place?


Otto Emil Lang: Questions about price are not being discussed now but they will be discussed at meetings of the International Wheat Council to commence on June 27 at which importers as well as exporters will be represented. Discussions among the exporters have been mainly related to the techniques which could be used to ensure that any agreement achieved internationally could be
May 20, 1977

maintained and supported in a way which was not possible under the old agreement.


INTERNATIONAL WHEAT AGREEMENT-METHOD OF AVOIDING DEPRESSING EFFECT ON PRICES OF STOCKPILING
Jack Burnett Murta: One of the most important aspects of this whole question from the point of view of wheat producers is the way in which the various governments administer a stockpile so that supplies will not become a burden and have a depressing effect on world wheat prices. Can the minister enlighten the House as to how the various countries, and specifically the Canadian Wheat Board, view this situation, and what do they hope to use in place of a large stockpile, which would certainly have a depressing effect on western grain prices?


Otto Emil Lang: Mr. Speaker, it is my position that the importers must recognize the value to them of security of supply and also must not want an agreement which leads to the exporters paying for that security by lower prices because of that very reserve. This will argue either for payments by importers of part of the carrying costs of the reserve and devices to ensure that it does not affect the market when the market is otherwise relatively weak, or it will lead to such price structures which take into account the carrying of the reserve by the exporting nations. Those are the two basic alternatives. If it is the latter, that obviously also complements the fact that we will likely have to have an understanding about the relative reserves to be carried by the various exporting countries in order that we know how that affects the market share to which each is entitled.


COMMUNICATIONS
Mr. F. A. Philbrook (Halton):: Mr. Speaker, my question is addressed to the Minister of Communications. In view of the recent decision by Bell Canada to forbid its operators to leave messages to return collect calls, and in view of the need for constituents to have easy access to their MP's, have any alternate arrangements been considered to assure these crucial telephone links between our Ottawa offices and our constituents?

Particularly, does the government intend to make an agreement with Bell Canada to allow calls to members of parliament or to make zenith calls from our constituencies possible?


Hon. Jeanne Sauv6 (Minister of Communications):: Mr. Speaker, I was informed of that problem and I have already called a meeting between Bell Canada and the government telecommunications agency and the other transCanadian tele-
Oral Questions
phone systems. The meeting will be held this afternoon and I hope we will find arrangements which will meet the needs of members of parliament.


LABOUR CONDITIONS
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, my question is for the Minister of Labour and it is based on the promise in the Speech from the Throne last October that an industrial safety and health centre would be established to assist companies and workers in their efforts to identify and remove health and occupational hazards. In light of a study released two or three days ago which shows that nickel workers in Port Colborne, Ontario, have abnormally high rates of nose and lung cancer, which underlines the need for this centre which was promised last October, can the minister say what progress his department is making in implementing his promise?


Hon. John C. Munro (Minister of Labour):: Yes, Mr. Speaker. We have had many discussions with the provinces since that announcement last October. Generally the provinces welcome the initiative and we have worked out arrangements with them. Many of the provinces are going to utilize the services of the institute.
So far as the business and labour communities are concerned, we have had several discussions with them also. Labour would appear to be now ready, as a result of those discussions, to participate, along with business and government in some type of tripartite arrangement, in the general supervision of this institute, the feeling being that it would not be workable or effective unless all these elements-business, labour and government-got together and in a sense the institute operated under that aegis. In order to achieve several of the things they want to do the co-operation and involvement of these essential elements would be required.


PUBLIC SERVICE
Mr. Walter Baker (Grenville-Carleton):: Mr. Speaker, may I direct my question to the Minister of Public Works. In his statement on May 17 with respect to the movement of departments of the Public Service to Hull he expressed some sentiments concerning small shop and restaurant owners, indicating that negotiations were underway with their association. I wonder whether the minister could tell us what negotiations are underway, what proposals are being made to the business and property owners association in the area, and what studies, if any, were carried out, prior to making the announcement,

May 20, 1977
Oral Questions
which he could table in the House as to the effect of this massive move on the small owners of shops and restaurants in the area?


Hon. Judd Buchanan (Minister of Public Works):: Mr. Speaker, basically what I have indicated to the Building Owners and Managers Association is that I should like to try to arrange, after the leases have expired-that is what we are talking about; we are not terminating leases-to keep partial occupancy in the buildings so there continues to exist a clientele for restaurants, small shops, and so on. That is our desire.


TRANSPORTATION ARRANGEMENTS FOLLOWING MOVEMENT OF EMPLOYEES TO HULL
Walter David Baker: A supplementary question, Mr. Speaker. That is an interesting comment on the restraint program. In the course of his statement the minister mentioned arrangements in regard to interchange of transportation in an area which is already chaotic and inadequately serviced in terms of bridges, roads and other things. What specific arrangements is the minister prepared to make in order to ensure that there is reasonable passage of both private vehicles and public transportation vehicles to and from the city of Hull? Is it the position of the minister that there is no finality in this respect? Are there to be additional bridges built and, if so, when? Are there to be additional transportation facilities provided? If so, when, at what cost and by whom? Can the minister also indicate whether there has been any advance planning with respect to this matter, apart from political input?


J. Judd Buchanan: Mr. Speaker, that is a question I have discussed with my colleague the Minister of State for Urban Affairs; obviously it relates to his jurisdiction and to his responsibility for the NCC.

[ Translation]


MANPOWER
Mr. C. A. Gauthier (Roberval):: Mr. Speaker, my question is for the Minister of Manpower and Immigration and relates to promoters of Canada Works and Young Canada Works projects. All those whose projects are accepted receive confirmation, but for those whose projects are rejected, could the minister ask his officials to give the reason for the postponement or refusal of a project, or at least inform those people that their projects are rejected and to thank them for the efforts they put into submitting them?


Hon. Bud Cullen (Minister of Manpower and Immigration):: Mr. Speaker, the point the hon. member makes is a good one. It is a question of numbers and degree in regard to our

resources. Since these are done on a constituency by constituency basis, we do make very definite efforts to publicize those projects which have in fact been accepted. Sometimes there is further negotiation with a member of parliament or with a project officer himself, and that causes some delay. With regard to the point that the hon. member makes about those projects which are not accepted, we are grateful and we hope the applicants will look at the programs which have been accepted in order to see how they might improve theirs so they are accepted in the second phase and can put to work the people they want. I think that is an excellent representation and I will certainly look at it.


IMMIGRATION
Mr.  R. Gordon L. Fairweather@Fundy-Royal: Mr. Speaker, I have a question for the Minister of Manpower and Immigration. How has the minister responded to the request for his intervention in the case of Pedro Denegri against deportation to Chile?


Jack Sydney George (Bud) Cullen: Mr. Speaker, in this particular case the first public representations I received were in my own riding from the Coalition for Change group of London. I subsequently met with them again in London, together with Amnesty International representatives. I then met with a reporter from the Globe and Mail who had some additional information which he thought was appropriate and made a specific plea that I meet with Mr. Denegri's lawyer. I met Mr. Denegri's lawyer yesterday. I might say his lawyer put forward an excellent brief. She has obviously done a tremendous amount of work on this. I would like some time to consider that brief, and I would expect to come up with some response next week.


ALLEGED EXTENSION OF CLINICS TO PROVIDE ABORTION ON DEMAND-MINISTER'S POSITION
Mr. S. J. Korchinski (Mackenzie):: Mr. Speaker, 1 have a question for the Minister of National Health and Welfare. Because of the large number of protests being received, has the Minister of National Health and Welfare reconsidered his position as a result of his announcement of March 4 in which he proposed the further extension of abortion clinics which would provide abortion on demand, or does he still intend to actively pursue his original course and perhaps qualify for the dubious honour of "murderer of the year"?


Marc Lalonde: Mr. Speaker, 1 will send the hon. member another
May 20, 1977

Order Paper Questions



ROUTINE PROCEEDINGS

[Stage Direction]
copy of my press release. It does not seem to me he knows how to read.
['Agreed.\nExcise Tax']
Mr. Speaker:: Order, please. The hon. member for Selkirk.



Dean Waldon Whiteway: Mr. Speaker, my question is for the Minister of Justice and has to do with an ad which appeared in the May 9, 1977 Ottawa Journal, a copy of which I have sent to the minister. It is advertising "Legal Abortions on Demand". I had my office check it out and it in no way involves a therapeutic abortion board. The abortions are done in Montreal at a cost of $250. There are no questions asked. It is done on the same day. It takes ten hours. You are delivered, the abortion is performed, and you are brought back home. That is clearly in violation of the Criminal Code. My question is: what is the Minister of Justice going to do about it?


Stanley Ronald Basford: Mr. Speaker, I would like to point out that the hon. member has added to the ad and given it more publicity by referring to it today. It is unclear from the ad whether the abortions are proposed to be performed in Ontario or Quebec or in one of the states of the United States of America.
This matter was raised some time ago by the hon. member for Calgary North at which point I corresponded with provincial attorneys general about advertising abortions to be performed within their jurisdiction. If the hon. member's information is correct, that the abortions are in fact advertised as performed in the province of Quebec, the advertisement will be referred to the Quebec minister of justice.


David Samuel Horne MacDonald: Mr. Speaker, a week ago today I asked the Acting Prime Minister, with respect to the ninth United Nations conference on sugar, whether the government was taking a position directly contrary to its earlier one on the tin commodity agreement. I also asked a question with respect to the composition of the delegation. It is of importance now because the conference will end shortly in Geneva.
Over the past week the minister has not provided this information either to myself or to the House. It is important for Canadians to have a full account of it, and I am sure the minister would agree with that. I wonder if he can indicate when that information will be available, particularly so that we can have it before the conference is concluded.


Allan Joseph MacEachen: Mr. Speaker, I sincerely apologize to the hon. member for not making the information available. I will try to get it to him today.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Maurice A. Dionne (Parliamentary Secretary to Minister of National Defence):: Mr. Speaker, the following questions will be answered today: 1,608, 1,692, 1,852, 1,928, 2,398, 2,400, 2,425 and 2,478.


Mr. Howie: Is the government currently undertaking any studies with regard to the economic, cultural and political effects the secession of the Province of Quebec would have on the rest of Canada in general, and the Atlantic Provinces in particular and, if so, what are they and what are their terms of reference?


Right Hon. P. E. Trudeau (Prime Minister):: No.


Mr. Howie: Is the government giving any assistance to groups in Quebec whose main purpose is to promote federalism and, if so (a) what are their names (b) what type of assistance?


Pierre Elliott Trudeau: No.


Mr. Herbert: For each of the past ten years, what was the amount of imported argicultura! chemicals as a percentage of total domestic consumption?


Mr. Hugh Poulin (Parliamentary Secretary to Minister of Industry, Trade and Commerce):: Statistics Canada reports the following:
Note: Due to the nature of the available data, the information requested has been presented in two parts-one on fertilizer chemicals and a second on agricultural pest control chemicals.
Table I
	Domestic		
Consumption	Imports of	Importsof Fertilizer	Fertilizer Chemicals	Expressed atMaterials and	Materials and	a PercentageMixed Fertilizers	Mixed Fertilizers	of DomesticYear	in Short Tons	in Short Tons	Consumption(2 as a1	2	percentage of I)(Short tons)	1975	2,950,243	285,425	9.71974	2,875,518	380,747	13.21973	2,492,084	287,627	11.51972	2,173,892	321,403	14.81971	2,110,978	236,354	11.21970	1,867,522	140,147	7.51969	1,897,622	181,097	9.51968	2,292,123	250,725	10.91967	2,183,406	319,973	14.71966	1,917,864	309,624	16.1
5846

May 20, 1977
Order Paper Questions
1.	The fertilizer year is defined as ending June 30. Imports are presented on a consistent basis.
2.	In order to capture the importation of chemicals intended for agricultural application only, Trade of Canada data could not be utilized for most chemicals. Rather, a separate import series on fertilizer chemicals is collected and published annually in Fertilizer Trade (catalogue number 46-207). Although some small importers may be missed, i.e., individual farmers, we do not judge the error factor to be significant. Data on muriate and sulphate of potash were, however, extracted from Trade of Canada.
3.	The data presented represent short tons.
4.	Imports of phosphate rock are excluded.
Table II
	Domestic		
Consumption	Imports of	Importsof Pest Control	Formulated Pest	ExpressedChemicals in	Control Chemicals	PercentageThousands of	in Thousands	DomesticYear	Dollars	of Dollars	Consumption(2 as a1	2	percentage of 1)($000's)	1975	170,024	87,887	51.71974	108,572	65,501	60.31973	77,458	45,230	58.41972	53,065	30,772	58.01971	42,172	23,732	56.31970	40,455	17,345	42.91969	46,665	43,262	69.11968	54,392	28,793	52.91967	46,072	20,703	44.91966	40,656	15,352	37.81.	Data are presented in thousands of dollars.2.	Domestic consumption data are based on a year end of September 30th.3.	Import data are based on calendar year.4.	Domestic consumption data may include a small amount of exports which were not possible to net out of figures.5.	Import data includes forestry sprays and home and garden chemicals which cannot be separately identified in the Trade of Canada data.6.	Data are presented for formulated pesticides, herbicides, fungicides only.


Mr. Hnatyshyn: Is the government aware of reports that exterior concrete construction surfaces treated with anti-spalling compounds will last up to ten years longer and, in some cases, ten times longer than those surfaces not treated and, if so, is the government giving consideration to including the use of anti-spalling compounds as a protection in all construction contracts in Canada and especially those entered into by the Department of Public Works and, if not, for what reason?


Mr. Alexandre Cyr (Parliamentary Secretary to Minister of Public Works):: The Department of Public Works is not aware of any reports by established research or testing organizations on exterior concrete construction surfaces treated with anti-spalling compounds. In normal environments good quality concrete, with scientifically designed ingredients and properly installed, will last indefinitely. It would, therefore, be a waste to treat all exterior concrete with alleged anti-spalling compounds in all construction contracts in Canada. In particularly corrosive environments special precautions are usually taken, but such situations are a small percentage of the overall.


Mr. Hnatyshyn: Is the government aware of reports that shrubs of the Euphorbia strain produce a hydrocarbon substance very much like gasoline and estimates are that the plants might be capable of producing between 10 and 50 barrels of oil per acre per year which is practically free of sulphur and other contaminants at an estimated cost of between $3 and $10 per barrel and, if so, what research is the government presently undertaking in this regard?


Hon. E. F. Whelan (Minister of Agriculture):: Agriculture Canada is aware of the reports and is continually keeping watch on all possible renewable resources of oil. The department is not conducting any research into this program. Feasibility studies are being conducted in California and will be reviewed by the Department when they become available.


Mr. Hnatyshyn: Is the government aware of reports that coffee substitutes can be produced from wheat, bran and soyabeans, which are readily available in Canada at approximately half the price of pure coffee and, if so, what steps is the government taking to assist research in this area?


Eugene Whelan: Yes, Agriculture Canada is aware of research and development on coffee substitutes. However, since the food industry is conducting research on a beverage resembling coffee, the department sees no need for research at this time.


Mr. Marshall: 1. What additional staff was hired and what was the cost to operate the Student Summer Employment Programme (a) Fisheries and Marine Service (b)
May 20, 1977

Environmental Protection Service (c) Environmental Management Service under the Department of the Environment?
2. Are any other programmes available for students under the Department?


Mr. Jim Fleming (Parliamentary Secretary to Minister of Fisheries and the Environment):: 1.
Service	Students	Costs(a) Fisheries and Marine	526	$1,580,886(b) Environmental Protection	49	145,011(c) Environmental Management	327	986,965
2. The Summer Job Corps (SJC) Program is also available for students. This is a new program implemented in 1977 and sponsored by the Department of Manpower and Immigration.
DFE has been allocated $471,704 distribution is as follows:	to create	213 jobs. TheService	Students	Costs(a) Fisheries and Marine	46	$ 113,223(b) Environmental Protection	30	59,275(c) Environmental Management	137	299,206


Mr. Cossitt: 1.	Is Mr. Joe Mullally, former Special Assistant to the Honourable Member for St. Boniface, employed under contract to, or in any other way working with the government and, if so, what are the details of his work, position and monies received?
2.	Has Mr. Mullally been in any of these categories since he left the Minister's office on March 15, 1977 up to the date the answer to this question is prepared and, if so, what are the complete details of work performed, job designation, salary, etc?


Mr. Ralph E. Goodale (Parliamentary Secretary to President of the Privy Council):: 1. No.
2. No.


Maurice Adrian Dionne: Mr. Speaker, I ask that the remaining questions be allowed to stand.


Mr. Speaker:: The questions enumerated by the hon. parliamentary secretary have been answered. Shall the remaining questions be allowed to stand?


Some hon. Members:: Agreed.
Excise Tax



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Tuesday, May 17, consideration of the motion of Mr. Macdonald (Rosedale) that Bill C-54, to amend the Excise Tax Act (No. 2), be read the second time and referred to committee of the whole.
Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, on May 17 the minister made his opening statement with regard to second reading of this bill and outlined in part those matters which are to be handled in the bill this afternoon. I would like to talk about the air travel tax to which there is now an extension so that it becomes all-encompassing. I suppose there is a case that can be made for the imposition of an air travel tax within certain limits in Canada. When the matter first came up, there was tremendous objection across the country to the formula that was proposed, which was on a percentage basis. The formula would have hit particularly people who lived long distances from central Canada.
The formula was going to be based upon the value of the ticket, and it included, at that time, frontier areas; there were no exemptions at all. That just did not wash. Even though I moved a motion at that time which substituted a dollar value which would have yielded the same amount of money, I recall the Chair ruled my amendment out of order. With the greatest respect, I think the Chair was totally wrong. The Speaker indicated that he was not going to introduce any innovations, and in any event he was going to rule against the motion I made.
Be that as it may, we have now had this air travel tax for a couple of years. It is on a fixed dollar basis and is a user-pay tax. This concept of user-pay is dearly loved by the Minister of Transport (Mr. Lang). That is now being abandoned in a number of sectors, principally on the west coast ferries.
The tax is being applied with equal vigour across the country except in the frontier areas. What is being given back to the travelling passenger who is paying the shot is a long way from even. For instance, in Toronto there are customs preclearance facilities to go to the United States. If you try to get them in Edmonton and Calgary, you are told by the minister and his representatives that the airlines have to put up the facilities; the airlines have to charge the passengers, and therefore Edmonton and Calgary traffic has to pay an extra charge for facilities which are provided for under the $5 tax in Toronto. Is that an even hand in the handling of passengers across the country? Every international airport handling traffic to and from the United States should have preclearance facilities such as Halifax, Montreal, Toronto, Ottawa, Winnipeg, Edmonton, Calgary and Vancouver.
The Minister of Transport can smile. However, if he has been listening he knows that passengers outside of Toronto-I will not speak about the mess in Montreal-are getting the
80016-30/4

May 20, 1977
Excise Tax
short end of the stick. They should have negotiated and arranged for preclearance facilities long ago. The absence of preclearance facilities in Canada gives the American lines an advantage over Canadian lines on competitive routes.
Talk about dragging their feet in Transport! Preclearance facilities in Edmonton and Calgary have been under discussion for years. The latest answer I have from the Minister of Transport is that when western Canada's "Mirabel" comes into operation in Calgary in September of this year, the facilities will exist for preclearance. For Edmonton, which has an equal demand for preclearance, it may be the fall of 1978, after the Commonwealth Games. That does not bother the minister one bit. The traffic flow into Edmonton will be somewhat less than Calgary as a result. They say that, because Calgary has more traffic than Edmonton, it should be treated differently. That is a lot of poppycock. The dice are loaded. In so far as the utilization of this air travel tax is concerned, the Department of Transport is applying it with an uneven hand.
I have been asking about the facilities in Gander from a revenue and an immigration point of view. Frankly, the minister is content to handle passengers who are flying through on a sort of cattle-pen basis. There are very inadequate temporary facilities. In so far as getting on with the job and putting in permanent facilities, Transport Canada are dragging their feet. All this is done within the comfort of headquarters in Ottawa. It does not much matter to the people who make the decision whether there is delay. If the increase is in building costs, they would not have to pay the shot. Therefore, it is an easy decision to defer. However, from the taxpayers' point of view it is a stupid decision. It costs the taxpayers from 20 to 25 per cent more, and they get less service.
I see the Minister of Transport is leaving the chamber. I just want to say to him that in this particular area there is a justifiable complaint. I hope he will take part in this debate and tell us what he proposes to do about the even application of the airport travel tax which is chargeable to all passengers in Canada. Some will get a dime's service in return and others will get their $5 worth every time they travel. The travelling public in Canada is entitled to a much better break than that.
We sometimes wonder why it is so difficult to have regional contact in Canada. We must contemplate the fact that to travel within Canada, for example from Ottawa or Toronto to Calgary or Edmonton, it costs more than flying to Europe on charter. In winter, the bulk of the Canadian population have greater access to European ski resorts than to the Rockies. Why? Canadians are being stuck, really having it rammed home, with regard to travel within their own country. There is something wrong. This problem must be worked out. This is why there is a sense of bitterness and frustration at times. The ministers should get involved and talk to those who are affected in this way.
The same principle is applied in another area. I cannot condemn it enough. The minister is now trying to even-up the situation with regard to buying tickets in Canada or buying them outside Canada. That part of it is fine. However, 1 want the Minister of Finance (Mr. Macdonald) to understand that

in utilizing these funds the Minister of Transport has to be much fairer. The changes being made in the sales tax are not all subject to criticism. The minister has taken one very salutary step. It has taken some time to get there, but I-and, I am sure, members on all sides of the House-thank the minister. I refer to the so-called small business limit which so severely affected philanthropic organizations, rehab centres and individuals partially incapacitated who produced a small volume of goods of one variety or another: they could be handicrafts, or all sorts of other things.
I do not know when the $3,000 limit was put on. One might almost say that the new $10,000 limit has merely taken care of inflation. At least it is a step in the right direction. To that extent, the minister is to be congratulated for his compassion with regard to these people and public service organizations. We hope the minister's officials will keep their minds open to further relaxation in order to get ahead of just the impact of inflation and to encourage these people to do something on their own. It is far better for an individual who has a small business to produce $15,000 or $20,000 worth of goods from which he will not derive that much income, if he can sell them without an impost of sales tax. What is the alternative? Welfare, some form of social assistance. Where does the social assistance come from? It comes from the pockets of hon. members and the taxpaying public. It is ridiculous. There is a wrong social implication to it. It is far better to encourage individuals to go out and wrestle for themselves. As a result, they would have a sense of dignity.
I have had a good deal to do with people in the social services' field in my home city. I have always found it absolutely inconceivable that the so-called principles of equity of taxation have borne down as hard on these people as they have on others. Yet there we were, trying to encourage them to some degree of self-sufficiency through rehabilitation centres to get them back on their feet. After all, one has only to engage in correspondence with the disability section of the Canada Pension Plan to see the rules which are applied there as to whether a person is disabled. It is almost a matter of, if people can breathe or stand up, they are not disabled. That section feels that if people can do some form of work-and it cannot say what form-that is the responsibility of those people, so they are denied benefits under the Canada Pension Plan for which they and their employer have paid. The government pays nothing into the Canada Pension Plan, not one blessed red cent, and the alternative for these people is to seek welfare.
The government is quite prepared to pay 50 per cent under the Canada welfare plan for the support of people who, with a little bit of initiative and some sense of personal worth, are prepared to do something. But no, we have to tax them. I think this is a strong and very compelling case which provides equity to taxpayers generally and to citizens generally. This proposal would not only maintain this type of level of exemption to take care of inflation, but it also would have an incentive, and I suggest to the minister in all sincerity that he should look at
May 20, 1977

that to see if we cannot in some way restore an incentive for partially disabled persons. I refer to blind persons and others in the same category. However, let us consider those who may suffer from heart trouble and who cannot carry on their normal work, but who can engage in some type of small production alone or in conjunction with others. I referred only to heart trouble, but it might be some other crippling disease which handicaps people, such as arthritis. There are all kinds of handicapped people. From a social point of view, I think we could use our tax system to encourage those people and to improve social benefits so they will not just be recipients of welfare, which is so soul-deadening for so many in this country.
There are many points in this legislation which my colleagues will want to talk about. I know they wish to talk about points dealing with gasoline and diesel fuel, but there is one I would like to talk about at this stage. I am sorry I did not have the correspondence I now have at the time we were discussing Bill C-55. I have here an exchange of correspondence with the minister's colleague, the Minister of National Revenue (Miss Begin). The reply she gave me was quite right, that the way the Customs Tariff is now worded, it would require a minor amendment to let this particular type of equipment through free of customs duty and sales tax. I am referring to spray markers. We have to be very, shall we say, simple here. It is a small matter, but very important.
I am referring to markers for agricultural aerial sprayers. Hon. members might wonder what on earth those are. Well, we have to understand what is done by aerial sprayers and what it means to western agriculture to spray pesticides or fertilizers. It is remarkable how many pilots of these aircraft there are. They have to use markers on the ground in the same way anyone here would when marking out his garden. There is one way of doing this, and that is, of course, to have a couple of persons on the ground walking along the edges of the field and marking out the lines for spraying or for fertilizing. Some people have been killed because, let us remember, these aircraft fly very low. Others, unfortunately, have been sprayed by pesticides, and they continue to be sprayed. The alternative is to use very light, brightly coloured markers.
In outlining the case to the Minister of National Revenue on March 31,1 referred to an entry at the port of Red Deer. An Alberta firm was endeavouring to bring in these markers from the United States through the port of Red Deer, but it was charged a considerable sum in customs duty and sales tax. In my letter to the Minister of National Revenue I wrote the following:
These markers are made of a special form of tissue paper and actually represent a necessary substitute for a human flagman, hitherto used and exposed to vapour spray, etc. In addition, there have been persons killed by being struck by the wheels of the low flying aircraft and there have been many near misses ... the American firm called North American Industries Incorporated of Walla Walla, Washington have been able to obtain the necessary kind of paper and put these markers on the market.
Canadian paper mills have all been canvassed, but none of them has been prepared to manufacture a similar type of paper in the rather limited quantity which is needed to supply
Excise Tax
the Canadian market. The market may grow as time goes on, but at the present time there is just no one who is prepared to manufacture this type of tissue paper. However, combining the American requirements and the Canadian requirements makes it a viable operation. Unfortunately, under the Customs Tariff classification there is duty and tax. It seems to me that since this commodity is not manufactured in Canada, and since there is little likelihood it will be because of the limited market, Canadian agriculture again has to take it in the neck.
The costs are higher for Canadian producers. The hon. member for Red Deer (Mr. Towers) and hon. members from other areas where large-scale agriculture is the order of the day will readily support me when I say that I think there is a case here for submission to the Minister of Finance for relief from the customs duty on this item. After all, we went through the Customs Tariff the other day and there are some items which are really sophisticated. I think a better case can be made for these aerial markers than for the free importation of frogs legs, for example, and there are a number of other things which are rather sophisticated in the Customs Tariff.
Therefore, a matter of this kind is worthy of consideration, and I submit it to the minister for relief from customs duties. If that is done, then we can make a case for relief from sales tax. That is what is relevant today. They would of course, both be relevant to customs and sales tax. So many commodities in agriculture, because they go into the production of food, are relieved from customs and sales tax, and I think this is a particularly good case.
Mr. Speaker, I think I have spoken long enough. This afternoon other hon. members will be raising various points. We will be able to deal with these matters later in committee of the whole. For those things which have not been done, then, of course, second reading procedure provides the opportunity for remarks or exhortations to the minister. I hope my colleagues will make some good suggestions.
This is not a subject that has the greatest sex appeal as far as hon. members and the public are concerned. They do not realize that often in debates of this kind their pocketbooks are either being relieved of money or, through the representations of hon. members, relieved of an unnecessary impost of taxes. I think this is one of the purposes of discussion of a tax bill. I hope we can carry on and by the end of the afternoon finish with this bill.


Sinclair McKnight Stevens: Mr. Speaker, the bill before us, Bill C-54, is often regarded as a rather routine piece of legislation. It is true that with the exception of the air transportation tax, its provisions are more or less technical rather than of a substantive nature. That does not mean that this bill is unimportant or that it will have little impact on the average Canadian. In that connection, I think it is important that we get on the record the amount of money that we are actually referring to as far as revenue is concerned at the federal level as a result of the taxes that are imposed within the act that we are proposing to amend today.

May 20, 1977
Excise Tax
Today I refer hon. members to the publication entitled "Public Accounts of Canada, 1976, Volume 1, Summary Review of Financial Statements." At page 5-3 it is pointed out that under excise taxes the sales tax alone yielded $3,365 million, or 11.5 per cent of the total federal government revenue, in the fiscal year ended March 31, 1976. The next item which comes in the same general category is oil export charges, which amount to $1,062,900,000, or 3.6 per cent of the total federal government revenue. Other taxes that come under the general heading of excise tax amount to $437.7 million, or 1.5 per cent of the total federal government revenue. Special excise tax on gasoline, which most of us are very sensitive to, amounted to $425.1 million, or 1.5 per cent of the total federal government revenue.
Hon. members might be interested in page 5-6 of the same report. We find there that not only is there sales tax of roughly $3.3 billion, but the other excise taxes on such things as cigarettes, tobacco and cigars, yield $369 million; on jewelry, watches and ornaments, $32.5 million; matches and lighters, $2.8 million; wines, $12 million; and sundry items, about $19 million.
I mention those figures because I think it is important in dealing with this bill today that we realize the magnitude of the revenue that comes out of the legislation we are now proposing to question. Even in this bill of only 12 pages and 20 clauses, the government demonstrates a remarkable knack for convoluting reason and for adopting policies that are in many ways almost 180 degrees off dead centre.
In the case of the air transportation tax to which the hon. member for Edmonton West (Mr. Lambert) referred, the government has managed to take a regressive step, when bold initiatives are needed. It has somehow managed to devise a tax on tourism at a time when our need for the tourist dollar has never been greater. In this bill the minister is proposing that we siphon an additional $15 million to $17 million from air travellers this year. It is perhaps an understandable, or at least a predictable measure, with Mirabel having lost $56 million in its first year of operation and being projected to lose another $56 million this year.
It is perhaps predictable that the government gets on to this user-pay concept when we realize they have tied up $110 million in federal funds in the still-born Pickering airport project in the Toronto area. In short, it is not surprising that the government would rather covet this form of additional revenue. In its present form, the tax, we understand, generated about $61 million between April, 1976, and February, 1977. This year it is expected that the tax will raise something like $66 million. Perhaps at committee of the whole the minister will be able to give us more precise figures on how much he anticipates in revenue from this tax alone.
Before the proposal becomes law by passage of this bill, I think we have to consider whether it is right to be extending this tax to travellers who purchase tickets outside of Canada. Surely we should be asking that question. Of the 2.3 million passengers the minister says will come under this new tax, more than 2 million are foreign visitors to Canada. That is the
[Mr. Stevens.)
number of visitors to Canada who arrived by air last year, according to Statistics Canada. To put it plainly and simply, this tax is a levy on tourism, despite the minister's rather oblique reference to "travellers who use Canadian airports."
That the minister should propose such a tax when our national travel account is in a deficit is myopic indeed. Surely hon. members do not have to be reminded that last year the over-all travel account in Canada registered a deficit of $1.2 billion, 63 per cent greater than in 1975 despite the major attraction of the Montreal Olympics.
It is a dismal record and one which should command the government's concerted efforts to rectify it. Since 1971, our over-all travel deficit has widened five-fold; that is, our travel deficit in 1976 was more than 500 per cent greater than that of 1971. Anyone wishing to confirm for himself this drift from a deficit of $202 million in 1971 to $1.2 billion in 1976 should look no further than table 25 on page 61 of the minister's own "Economic Review" that was tabled recently in this House. I strongly urge the minister to read that report which his department prepared for him and to reconsider his proposal to tax foreign visitors who use our airports. To tax tourism- however marginally-in the face of deficits like these is shortsighted and insensitive. Let there be no mistake about that.
We are not suggesting that the bill will be a direct deterrent to air travellers coming to Canada. At $8 or less per person, this tax, especially when compared to international air fares from Europe and beyond, will however be one further deterrent to such tourism being expanded as far as Canada is concerned. If the bill does little to discourage tourism, it does nothing to encourage it. It is a further deterrent to tourists visiting this country; it does nothing to encourage tourism and will not help us to overcome our deficit in tourism. The bill represents another lost chance to take imaginative, positive action for remedying our critical deficits. In this context, Bill C-54 and the air transportation tax should be viewed as an incomprehensibly regressive measure. We see, here, a small, mean little step backward, whereas vision was required or leaving well enough alone would have been sufficient.
It is interesting to review the government's justification for the airport tax. In the budget brought in on June 23, 1975, former minister of finance John Turner proposed to extend the air transport tax which had originally been imposed in 1974. He said:
The increases, to be effective August 1 this year-
Meaning, 1975.
-are essential to reflect the general policy that those who benefit most directly from facilities provided by the government help to pay for them.
In other budgetary presentations, the Minister of Finance (Mr. Macdonald) has adopted the user-pay concept with respect to airports. Perhaps it is fair to ask users to pay, but that stops short of the real question, which is this: Has the government been prudent in operating our airports? Has it controlled airport expenditures? In short, if users or others are required to pay, must they pay for the expenditures which
May 20, 1977

have been incurred? I raise this question because I think one should be aware of some interesting figures. For example, I note that in the 1970 fiscal year our airports actually made money. On the other hand, during the last seven years, owing largely to the Department of Transport's inept, incompetent approach to airports, our airports ran up a staggering deficit which the government now asks users to make good.
If the government had shown more foresight, a little more restraint, a little less bureaucratic proclivity to indulge in the building of white elephants like Mirabel and the still-born Pickering project near Toronto, users would not have to pay a nickel and our airports would be breaking even or making a profit. Let me put some figures on record.
After paying almost $20 million in construction costs in 1970, our airports showed a deficit of $2 million. In short, they made about $18 million or more in profits from their operations in 1970. For example, Montreal's international airport, Dorval, after spending $482,000 on construction and acquisitions in that year, actually made a profit of $9 million from operations. Malton, near Toronto, made over $2 million, even after spending $6.3 million on construction and acquisitions. In short, our airports made money from operations in 1970.
Owing to this government's sheer incompetence and mismanagement, that picture changed. According to current estimates, or estimates relating to the 1978 fiscal year, it is estimated that our airports will lose $133 million. That is a colossal turnaround. In seven or eight years our airports, instead of making modest profits from operations have managed to run up enormous losses. As I said, the anticipated loss in the 1978 fiscal year will be $133 million. Therefore, is it not fair to ask if the user-pay concept is justified? Should users be asked to pay for expenditures the prudence of which is open to question? Let me emphasize that much of the $133 million anticipated loss is attributable to operational losses incurred by misadventures in airports like Mirabel.
It is anticipated that in the fiscal year previously alluded to, Mirabel is expected to lose some $56 million, but Dorval is expected to make $1.1 million. Malton makes money on its operations but loses money on construction. This year, Malton will incur a net loss of about $16 million, after having made a profit of $19 million from operations and spending about $36 million on construction. The Pickering project, of course, is a big loser, running up losses of $17 million. In short, people are not being asked to pay the $8 tax to cover the basic cost of running our airports; they are asked to pay the tax in order to make up the deficits which have been incurred by the Mirabel and Pickering developments-and that is the truth.
In our consideration of this bill we should ask this question: Is it fair to make people using Edmonton airport, Halifax airport or, say, Thunder Bay airport pay the airport tax, without making it clear to them that the tax will cover the deficit run up by Mirabel and developments like Pickering? Because that is the purpose of this bill, and let us not forget it.
We suggest the minister should consider suspending the tax in Canada at least during the tourist season, instead of extending it to foreign visitors as is now intended. I suggest such a
Excise Tax
measure might mitigate somewhat regional disparities in our air fares and encourage Canadians to take vacations in their own country, offsetting that classic rationalization for travel abroad, namely, that it is cheaper to fly to Florida from central Canada than to Newfoundland or British Columbia.
If we choose not to impose the tax, I suggest we could gain a competitive edge, slight though it may be, over those countries which impose such taxes. This factor is especially important when we consider the balance of our travel account vis-a-vis the United States whose citizens are coming to Canada in declining numbers for the third consecutive year. Last year alone the number of United States visitors decreased by two million: fewer visitors came to this country again this year, and please bear in mind that this year we do not have the attraction of the 1976 Olympics.
There are many reasons for this decline. An important one, I suggest, is rising prices in this country. Our travel account with the United States having turned around from a surplus of $132 million in 1974 to a deficit of $610 million last year, it is time for the government to direct its energies to making travel in Canada more attractive and less expensive. We should be pursuing incentives for tourism, not taxes on tourism.
Recently I was talking with some tourist-oriented businessmen in Niagara Falls. Frankly, I was astonished at the difference they were able to show me between taxation on the United States side of the Niagara Falls district and taxation on the Canadian side. They were able to show me why their meals on the Canadian side cost between 20 per cent and 30 per cent more than comparable meals on the American side. It is this type of thing which is causing tourism to fall off. I feel the $8 extension of the airport tax will only heighten this trend.
To those who have read the budgetary papers, it must be apparent that the average Canadian pays substantially more in the form of sales tax, excise tax and what-have-you than does the average American. In the discussion paper which was issued with the June 23 budget of 1975 there is a table showing the relative position with regard to taxes on goods and services in the United States and Canada. Table 3 at page 14 of the discussion paper which lists the incidence of these taxes in the two countries rates Canada in 1972, for example, as having a level of 25.2 per cent. The level in the United States in the same year was 16.2 per cent. This shows, to the extent that the sales tax and the excise tax are regressive, to the extent that they hit the poor person as opposed to the person with relatively higher income, that our tax system is considerably more regressive than that of the United States. The difference is that 16.2 per cent of the revenue of the United States comes from this form of taxation, whereas in Canada it is 25.2 per cent.
Mr. Speaker, sound taxation policies can accomplish two distinct aims. On the one hand, the imposition of a tax can inhibit or control activity. On the other, the removal of taxes can encourage a desired activity. Both of these factors come

May 20, 1977
Excise Tax
into play with the air transportation tax. Unfortunately, this government has always been too quick to deter and regulate activity through new taxes, while it is slow to encourage positive action through the removal of old taxes. This is true, of course, with the air tax, and it also true of the sales and excise tax on automobiles. Here, again, the government seems to be 180 degrees off base.
The government, we were told in the last debate on excise tax, has initiated a weight tax and levy on air conditioners as a measure to encourage energy efficient vehicles. However, when we checked, we found that weight alone is not a concise measurement of energy usage as some models, though heavier, get better fuel economy than other lighter, but more wasteful models. The weight tax, as it is set up, would not accomplish its stated aim-to reduce energy consumption-but, rather, would only serve to add yet another source of revenue to the growing excise receipts. These receipts totalled, last year, some $5 billion if customs duty and excise and sales taxes are taken together.
We urged the government to change its tax criteria to fall in line with fuel efficiency rather than mere weight. We also suggested that the sales tax on lighter cars be dropped both as a spur to the economy and as a real incentive for the purchase of energy conscious vehicles. To date, of course, nothing has happened with either of these proposals and the government has once again chosen to pass up an opportunity for positive action in favor of the more regressive use of taxation. The 12 per cent sales tax on automobiles strikes hardest at those least able to afford it. Its removal would give a tax break to those most likely to benefit from it while providing a more direct approach to this nation's energy goals. I repeat, not only would it be in the interest of energy conservation but it would be a spur to employment in this country in that our automotive industry is oriented toward the production of smaller cars, more efficient cars, rather than to the heavier models.
We look forward to discussing this matter again with the minister when this bill moves into committee of the whole. On average today, Canadian automobiles cost between $500 and $1,000 more than their American counterparts. The lion's share of the difference lies in the taxes, and the taxes piled on taxes, extracted by governments. It is worth while to note, for example, that the Americans dropped their excise tax on automobiles in 1971 in order to stimulate the economy. They did this despite the fact that in some states-Michigan, for example-the revenue from the excise tax was greater than that produced by income taxes.
The average sales tax on Canadian automobiles is probably the largest single factor contributing to the higher cost of cars here. It is Ottawa which is the largest beneficiary of the production of automobiles. By this, I mean that if you break down the cost of an automobile, you find it is Ottawa which makes more money with respect to its purchase than anybody else: more than the car manufacturer, be it Ford or General Motors; more than the wholesaler; more than the dealer; more than any provincial government. In short, it makes between $300 and $1,000 on the purchase of every automobile in this

country, and then has the nerve to say it would like, somehow, to discourage inflation. Well, Mr. Speaker, one way in which the government could get less inflation is by reducing the excise tax on smaller cars, making them cheaper for the average man who needs them to commute to work.
May I call it one o'clock, Mr. Speaker?
At one o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.
Mr. Deputy Speaker:: Order. When the House rose at one o'clock, the hon. member for York-Simcoe (Mr. Stevens) had the floor on Bill C-54.


Sinclair McKnight Stevens: Thank you, Mr. Speaker. Before the lunch break I was indicating that we felt consideration should be given by the minister to the elimination or reduction of the federal sales tax on energy-efficient cars. I was pointing out that perhaps the largest single factor contributing to the higher cost of cars in Canada compared with the United States is that Ottawa maintains its excise tax, the United States tax having been removed in 1971. To put the matter in perspective, let me take, for example, a $3,200, four-cylinder Chevette. How many of us realize that the manufacturer makes about $75 on that car, the retailer makes about $100, yet the net take in sales tax alone which accrues to the federal government is $320. In other words, 10 per cent of the final retail price of that automobile actually goes to the federal government.
I suggest that that is not only inflationary in the sense that it causes people to pay that additional amount for a car, but it puts a hardship on the very people who should get relief in this country, namely, the average working person who needs a car to commute to work. Thirdly, it is a disincentive to people to buy a relatively small car, not only the Chevette to which I have referred but other similar types of automobiles.
Another item we will take up in committee of the whole is the excise tax on gasoline. Originally, the government declared that another gasoline tax amounting to 10 cents a gallon was necessary to support oil prices in Canada below the international market price. This tax was to be used, and has been used, to finance compensation payments to offset the cost of imported oil. As has been noted in the House, the 10 cents a gallon excise tax and the export tax levy currently produce revenue which exceeds the compensation payments by something like $300 million. As the domestic price of oil reaches the international market level, the need for this tax disappears, yet the revenues produced by it will increase. Here again, this windfall profit appears to be dropping into the hands of a government which, from its past record, has been irresponsible in the handling of such funds, certainly so far as their own restraint in expenditure is concerned.
In closing, let me add that we on this side of the House welcome the sales tax exemption for businesses with an annual
May 20, 1977

turnover of S10,000 or less. These will now be exempt from the sales tax provisions. This is something for which we on this side of the House have been asking for some time and we are pleased that the government has at last acceded to this request on our part. Incidentally, this provision removes an important obstacle to the small, independent Canadian craftsman and is long overdue.
Your Honour will recall that in the budget address of March 31, when dealing with other tax changes the minister stated:
Finally, I want to refer to the discussion paper on federal sales and excise taxation. The issue here is whether the tax should be shifted from the manufacturer's level to the wholesale level. The matter requires further consideration. The report of the commodity tax review group will be tabled shortly in the House. I have asked the President of the Privy Council to refer the report to an appropriate standing committee of the House for its assessment.
I am pleased that the minister has not forgotten that discussion paper and that he intends to table it shortly. This will enable us to have a debate and to review the matter in the House. I am not pleased with the fact that there seems to be prolonged study, study and study, with so little activity. As we review the discussion paper and subsequent comments concerning the possibility of having the sales tax changed from the manufacturing level to the wholesale level, there seems to be almost a predetermined government decision. If we refer to the discussion paper the minister referred to in his March 31 budget, we find stated under item 11 on page 7: "Consequently the government proposes to move the application of the federal sales tax from the manufacturers' level to the wholesale level." They have said that and they propose to do it.
[DOT] (UlO)
The minister made a very brief comment in his budget speech concerning the possibility of a wholesale tax. In the budget document there are almost two pages dealing with commodity taxes. We also find that while the government admits they have received 200 major submissions with respect to their proposals to change the sales tax from the manufacturers' level to the wholesale level, they go through the pros and the cons. They seem to end up in the budget document back to the point where they were in 1975, stating that most of the objections are admitted. They think it was a good idea, in spite of the objections. Surely it is a rather strange thing to have discussion papers issued, invite submissions, acknowledge objections and then turn around and say that in any event it should be put into effect.
If we reach committee of the whole before four o'clock, I hope the minister will make some comments later today. We may accept this coming into the House for further debate, but surely now is the time the minister should be bringing us up to date as to what his current thinking is on this important subject. I know certain of my colleagues wish to speak on this bill. I will conclude, but I do intend to ask questions at the committee of the whole stage on this important bill.


Mr. Bill Clarke (Vancouver Quadra):: Mr. Speaker, it was less than four months ago that I rose to debate a bill to amend the Excise Tax Act. That was not Bill C-54; it was Bill C-21.
Excise Tax
It is interesting to note there has been no change in principle in the amendments which are proposed by this bill. Four months ago, in January, I was complaining about the nature of this tax. I said then, and I would like to say again, that it is an unfair kind of tax because the people in Canada who are paying the tax are not properly informed of it.
Unless one has particular knowledge of law, or particular knowledge of business, one does not have this tax brought to his attention and yet he carries on paying it all the time. Taxes are necessary. Everyone knows that. But it is the duty of the government to be honest and tell people when they are levying a tax and to clearly let them know a tax is being levied. A further inequitable part of this tax is that it, itself, is taxed by nine out of the ten provinces in Canada. Thus, this tax is increased by the percentage charged in retail sales taxes by those provinces.
We have heard a lot of talk about equity and simplicity in tax systems. That should not be only applied to income taxes. There is no reason why it could not apply to this tax. The constant changes the government feels compelled to introduce continually illustrate there is no equity and no simplicity in this tax as well as many others.
I would like to refer to the minister's budget speech at page 16 where he made reference to the discussion paper on federal sales and excise taxation. That paper was introduced by the former minister of finance, Mr. Turner, in June of 1975, approximately two years ago. The present minister, in his budget speech on March 31, 1977, said that the issue is whether the tax should be shifted from the manufacturers' level to the wholesale level and that the matter requires further consideration. At the time that discussion paper was issued there were thousands of representations made from all across Canada about whether the system should be changed to shift the burden from the manufacturers' level to the wholesale level, or not.
With the lapse of two years, with these thousands of submissions which have been received by the government, the government should have been able to come up with some kind of policy. The minister said that the matter requires further study and he went on to say that the report of the commodity tax review group will be tabled shortly in the House. We know what "shortly" means in this House: it means we will be lucky to see it this fall. In his budget speech he went on to say:
I have asked the President of the Privy Council to refer the report to an appropriate standing committee of the House for its assessment.
That is another delay, Mr. Speaker. A standing committee on something like that is going to take further prolonged time. Goodness knows when we will ever see the results of the discussion paper on federal sales and excise taxation. I suspect it is a change that is not really wanted.
I should like to look at some of the provisions of the bill now before us. I notice the minister proposes to make some changes to sales tax exemptions for small manufacturers. He is going to increase that exemption from $3,000 to $10,000. Knowing the last time that exemption was changed, I am quite sure the increase to $10,000 does no more than keep up with the rate of

May 20, 1977
Excise Tax
inflation on manufactured goods. The complaint has been made often enough that the minister should be aware of it by now. This is a tax which is also applied to offices which do a little in-house printing with copying machines, or whatever, if they are above the exemption.
Even the small individual businesses in manufacturing cannot get by without manufacturing more than $10,000 a year worth of goods. When they exceed that and have to start paying the excise tax, in addition to all the rest of their taxes, they have a very difficult time indeed. Further consideration is still warranted on that provision. It is commendable that certain producers of craft products, which are significant to Canadian culture and heritage, are going to be helped out, too, although that does not seem to be spelled out too well.
We can commend the fact that some additional energy-conserving items will be excepted. I notice there has been no specific reference by the goverment to help recycling industries. One or two of them will come in under this exemption because recycled newsprint is now being used in the manufacture of insulation. That will be considered as an energy-conserving item. Other items were mentioned in the supplementary budget papers. I am referring to page 25, aides to the disabled. The minister is certainly to be commended for extending the exemption to wheelchair lifts and allowing power to the governor in council to prescribe by regulation. Although we on this side have often said that government by regulation is bad and should not be encouraged, in the circumstances we can at least say that the motive is good.
With regard to the exemption being extended to vehicles which are designed to carry 12 or more passengers, the minister should again be commended-and I do not like doing that too much, in having discovered a loophole whereby some of these vehicles were being used as individual, private recreation vehicles. That certainly was not the intent. I submit that if the government had been doing its job properly in the first place, the present correction would not be necessary.
The minister said that the aim of the air transport tax is that an equitable contribution will be made toward the upkeep of facilities. More work is needed in this area as abuses are still possible. The hon. member for York-Simcoe (Mr. Stevens) mentioned the problem of airport funding, in particular where some of this money was going to go and the hardship this tax would impose on the tourist business. It is possible to circumvent this $8 ticket tax by simply buying a single ticket which covers, say, six return trips.
Every couple of weeks or so I fly to my constituency. I pay an $8 tax on a return ticket. However, the system in no way prevents me from buying a single ticket for six return trips and paying only one $8 tax. The minister will probably suggest that there are very few people who will do that. His predecessor said that to me on many occasions, for example, with regard to the Registered Home Ownership Savings Plan. However, whether there are numerous people who will do certain things or not is not the point. The point is that the
(Mr. Clarke.]
government should make its regulations to ensure that they are equitable and applied equally.
This ties in with another abuse that is open-the matter of stopovers. When you buy a ticket and travel from one place to another in Canada, you may stop over as many times as you wish. You will only pay one $8 airport tax. The minister says it is for the upkeep of the facilities in the airports. The stopover passenger uses the facilities just as much as a passenger coming from outside the country, or any other passenger. The use is equal in all cases, but the demand is not. It would be a very simple matter for the government to correct this situation.
I will give an example. The airlines, including the government-owned Air Canada, charge sector fares when there are stopovers during a longer trip. Even though they are able to increase their revenue by charging sector fares, the government has ignored the possibility of collecting this extra tax which the minister says they need in order that travellers who use the facilities pay for them on an equal basis.
Many of my colleagues have commented on the gasoline tax. I will make only one or two comments. I understand that it is to be adjusted, but I am not clear on the purpose of the adjustment. This is a good time to ask ourselves why the government continues to levy the ten-cent per gallon tax which penalizes Canadians who must drive. I am not referring to those who are entitled to a refund, but those who must drive and do not get a refund. Considering the size of Canada, the lack of public transit and the fact that the government allows the price of oil to rise toward world levels, those who need to move about for business and other purposes are penalized by this tax.
Comment has been made on the concessions for smaller cars. The hon. member for York-Simcoe referred to the contrast in prices of automobiles between Canada and the United States and how the content of prices in Canada is largely made up of the extra sales tax that Canadians must pay.
Although it has been suggested a number of times, the government has not yet given any consideration to concessions with regard to the length of time a vehicle might last. The considerations of the government are strictly with regard to fuel economy. While one cannot argue with that, we should keep in mind the energy consumption required for the production of motor vehicles. Consideration should be given to encouraging Canadians to make their cars last longer.
One place where it could make a start would be in the capital city of Canada, right here in Ottawa. We have a very expensive commission-the National Capital Commission- that seems to be in control of things in Ottawa. Enormous amounts of salt are put on the streets in winter. It is not as though this were the only place in Canada that has a lot of snow. Many places on the prairies have a lot of snow and cold weather, but they get along without extensive use of salt. Obviously, the automobiles last a lot longer. In my city of Vancouver, the use of salt is almost unheard of. Cars last a very long time.
May 20, 1977

I wish to make some final comments on the remarks of the hon. member for York-Simcoe. He stated that this is a regressive tax, that further exemptions are needed to give relief to low-income Canadians. I certainly support that. I have called for this before. There should be exemptions for all food, housing costs, clothing and other necessities. It is clear that a wheelchair, which is exempt, is no more of a necessity to a crippled person than the other basic needs of a society.
While 1 find much to agree with in this bill, I think the government has again failed to give the needed deep consideration to the major changes of principle that are needed in the application of this legislation.


Mr. Stan Schumacher (Palliser):: Mr. Speaker, I wish to follow the lead of the hon. member for Edmonton West (Mr. Lambert) in his complaints about the application of the airport tax as it is being handled by the Ministry of Transport. The Minister of Transport (Mr. Lang) is not with us this afternoon. Perhaps the message will get through to him, although I have to admit it is difficult to get any kind of message across to that minister.
I feel that I have a grievance, along with several thousand other people who are required to use the terminal facilities at Toronto international airport. People seem to be getting used to terminal 2 which is there. It was a badly designed and misconceived building. Nevertheless, it is there. In order to make the whole complex a little more workable, several million dollars were spent to connect terminal 1 with terminal 2 by means of an underground tunnel.
This would be a useful thing if it could be used, but I find that it is difficult to use unless you happen to be travelling without any form of luggage, because if you check your luggage through in order to get a reasonable connection, you cannot expect to find your luggage when you arrive at your destination beyond Toronto. If a reasonable arrangement could be worked out for the use of that tunnel, whereby a person could carry his luggage with him through it, then we might be getting something for this added excise tax on travel.
It is bad enough to have to wait for the luggage to come off, but what makes it impossible is the fact that people have to run upstairs and wait for that little bus to carry them across to terminal two with their suitcases. 1 think that machine comes around about every 15 minutes, and if a person misses it, as is normal, he has to wait half an hour. By that time it is too late to catch the connection over to the other terminal. We have a facility which cost several million dollars, and it has not been useful on any occasion on which I have used it. When I have left my luggage behind, I have found nobody in the facility, and it has been something like a mausoleum.
It is high time the government became a little more efficient with the taxes it handles, and in this connection we are dealing with amendments to tax legislation which raise about 25 per cent of the total revenue of the government. Many taxes are hidden and people do not realize they are actually paying
Excise Tax
them. Nevertheless, they do account for a tremendous source of revenue for the government. The government should account for the way it handles that money because at the present time it is just not handling it properly.
The hon. member for Vancouver Quadra (Mr. Clarke) and the hon. member for York-Simcoe (Mr. Stevens) mentioned the discussion paper which was issued by the previous minister of finance two years ago. I wish some headway could be made in this area. Speaking for myself, I am little discouraged to find that the government and its advisers are moving toward shifting taxation from the manufacturing level to the wholesale level. As a matter of principle, I think the government should be more accountable for its taxation policies. I think there should be a shift to the retail sales level. If that were done, the amount the government is taking would be out in the open. If we keep it at the manufacturing or the wholesale level, it is a hidden tax and in many cases adds to the apparent cost of everything. Retailers generally fix their mark-up on the basis of the wholesale cost, and then take a percentage on the amount of sales and excise tax they have to pay to the federal government.
This may not be a politically easy move to make, but I think an effort to make governments more accountable is necessary. It should be harder for governments to raise money and this source of revenue should be moved out into the open. Then there would be more accountability on the part of the government.
I agree with what my hon. friends have said about delay. An improvement should certainly be made in the form of taxation, and I urge this government to move past the wholesale level to the retail level. This would probably be fairly difficult in the province of Alberta, a part of which I represent. At the present time in Alberta there is no direct sales tax. My proposal would mean the imposition of a sales tax, and if I were on the government side I probably would not want this. However, as a matter of principle, these things should be out in the open.
I join in congratulating the Department of Finance for increasing the exemption with regard to small manufacturers. I believe this measure is aimed toward benefiting people involved in voluntary social activities. I believe it is unfortunate that the government has got into so many areas of social welfare. People are beginning to expect everything to be done by the government in that area and volunteer activities are falling by the wayside. That is much to the detriment of the basic nature and fabric of our society. This is a small step to encourage voluntary movements, and I hope the government will not let it lie here but that it will take other steps to encourage people to help themselves and others through voluntary activities, rather than having massive government programs to solve everybody's problems-which the government has not been very adept in doing, in any event.
I wanted to make another point with regard to the Toronto airport and the cost of living. The fare for that little bus to which I referred used to be 10 cents. It took people from one terminal to another. Now it costs 25 cents. That is quite an increase, percentagewise; and there is no fee at all for the use

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of that multi-million dollar tunnel. It seems strange to me that we cannot better utilize facilities which have already been installed and, therefore, make us a little more efficient.


William Hillary (Bill) Clarke: In Vancouver, the bus is free.


Stanley Stanford Schumacher: It will not be for long, if we have the Minister of Transport and his user-pay concept around here much longer.
I would like also to comment on the business of car taxes. I am astounded that this government persists, in this area of high taxation, to increase those taxes. I can see some point in using taxation to encourage the use of energy-efficient automobiles, but the government's approach seems to be to increase taxes on large cars, which are already too high, and to leave the tax on smaller cars at the same level. I would rather see the government do something to reduce its total taxation "take" by removing, or reducing, taxes on energy-efficient models; and if a tax must remain on the other ones, they should be left at their present level.
Reference has also been made to the excise tax on gasoline. I agree with the government's state policy of increasing the price of petroleum to world levels, but the government should practice what it preaches and reduce the excise tax in the same proportion as applies to the price of oil, from which gasoline is extracted, because the stated objective is to reduce imports, and as that gap narrows the stated reason for the tax narrows. The government has an obligation to the people of Canada to refuse a tax that no longer has a reason for being.
In summary, Mr. Speaker, I feel that the government is asking us to amend legislation that accounts for a major source of its income. Numerous examples have been given to indicate they are not using this income properly. Because of that, I feel, as a general principle, they should be made more accountable and the public should be made more aware of this type of taxation. It should be out in the open. This would force the government to be more efficient with the money they take from taxpayers in this country.


Stanley Howard Knowles: Mr. Speaker, I should like to take just a few minutes of the time of the House to present to the Minister of Finance (Mr. Macdonald) an appeal which I readily admit has been made to me by only two persons. I suspect, however, that their view represents that of many others, and I hope the minister will give it consideration or at least ask some of his experts to look at it. The two persons who wrote me in this vein are from different parts of the country and I see no reason to think they were acting in concert. In each case the person is about to become an old age pensioner and retire. To use the language in one of the letters, this man and his wife have looked forward to their retirement for a long time.


William Hillary (Bill) Clarke: We look forward to yours.


Stanley Howard Knowles: My hon. friend says that he and some of his friends are looking forward to my retirement. They will have to look forward to it from somewhere else, because they will be gone from this place long before I am.
This man and his wife had planned their retirement for a long time, he writes, and would like to see Canada. They have a car and a small trailer and had planned to make a trip and see Canada in the first year of their retirement. But he says that the tremendous increase in the price of gasoline has just about put that plan out of the picture.
The argument he makes to me is that he did not know 5, 10 or 20 years ago what was going to happen. Surely some concession might be made to such persons. I am not standing here making an appeal that all persons aged 65 and over should not have to pay the gasoline excise tax. After all, that would include me-and I am in a position to pay it, being a member of parliament. I put it to the minister, however, that as there are already some exceptions-farmers, certain invalids, and so on-in terms of the excise tax on gasoline, I wonder if a way could not be found to assist senior citizens, especially those who are not employed, who do not have other income and who might have to meet any other conditions the minister or his officials would work out. I am not trying to give the details. I am honoured that there are eight or ten of the minister's top officials in the gallery, so I am sure they could work out the details.
As I said, this appeal has been made to me by only two persons but I make no apology for taking the time of the House in regard to it. It is a reasonable, human appeal and I hope the minister and his officials will take a good look at it.


Mr. Ron Huntington (Capilano):: Mr. Speaker, 1 will take this opportunity to offer a few comments and express a few concerns I have about the air transport tax proposed in Bill C-54. There are some conflicts in what is happening in Canada today that bring me to my feet to offer these remarks. Canada is at a low ebb in its economy and its ability to employ its people, but here we are moving in with another obstacle toward creating some energy within the travel market in the country. This air transport tax is a double taxation when considered with the tax in the United States. If you purchase a ticket in New York to go to Montreal and return, you are subject to a S3 U.S. tax-which, by the way, is sent into a trust fund that the federal aviation authority operates for expenditures on airways and airports. Then you have to pay another $8 tax to Canada.
The Canadian tax apparently goes to the administration of air transportation or the airport revolving fund, which in 1976 received $29.7 million in air transport tax-a substantial increase over the $5.7 million received in 1975. It is not practical to collect this tax at the other end.
The Minister of Transport (Mr. Lang) and his staff are aware how the system works in Europe. There, half of all tickets are sold by interline airlines, one-quarter by travel agents and one-quarter by the carrying airlines. How could the
May 20, 1977

collection of this tax be co-ordinated in a market like Europe when we are trying to attract some of their tourist dollars to this country? What we seem to be doing is imposing bad attitudes on tourists; on the one hand we welcome them, and on the other hand we send them off with a scowl.
In order to collect this $8 tax from foreign tourists we will have to accost them as they leave Canada and it will have to be done by the airline. In the United States, if a visitor refuses to pay his $3 tax the airline has the passenger sign a slip which the airline turns over to the government, which then has the responsibility of collecting. Where the tax is only S3, it is unlikely that the government will try to collect it.
Let us take the case of a family of four departing from Montreal. First, there is the bus ride from downtown to the airport-four times $5, making $20. If the airport tax was not collected at the European end of the trip-which is most unlikely-it has to be collected by the clerk at the airline counter. So four times $8 is $32. What a farewell for a family that has come to enjoy Canada. Of course, they could refuse to pay, which would give rise to all kinds of problems. It would hold up business at the counter and queues would lengthen.
Then there is the problem of handling the cash involved in this transaction. Most tickets are prepaid or purchased by credit card, so the visitor might have to join another queue in order to pay this tax that the airline is asked to collect on behalf of the government. What a way to build a travel industry! Why do we risk people leaving the country with a sour attitude?
It was suggested that the tax be collected through the customs and excise officials at the airport, but they pointed out that it would involve them in union problems. What will happen with the airlines if they are landed with this problem on top of their already onerous duties? I say this because, at this time in our history airlines can only cut costs and balance revenues with expenditures by cutting down on personnel. I suggest we are applying unnecessary pressure.
Consider what would happen to a person visiting Canada who bought his ticket in Europe. Since the carrier has brought the passenger only one way, from Europe to this country, the contract of carriage has only been half fulfilled. Let us suppose that the passenger will not pay the tax. What could happen? The airline could choose to break the contract of carriage, could choose not to collect the tax and be liable to penalties under the act and, perhaps, in the process, be responsible for that passenger missing his departure flight. The airline would then face the prospect of paying for the overnight accommodation. As you can see, Mr. Speaker, this position would add burdens to the industry already severely burdened with problems.
Largely because we insist on passing measures like Bill C-58, other countries are retaliating against us. The United States government will not allow U.S. citizens attending conventions in Canada to deduct their convention expenses for purposes of income tax. So in the United Kingdom there has
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arisen the question of retaliation with respect to security costs against Canadian airlines, because United Kingdom airlines are forced to pay security charges in Canada, whereas such services are provided in England by the British equivalent to our Department of Transport. This kind of retaliation is starting to build up against us-and we do not need it, especially at this time.
No doubt the government will claim that the collection of the transport tax in other countries is a step in the right direction. They say it is an equitable step, for, if Canadians must pay, why should not others? I suggest that if we welcome others to this country we should not involve them in the sort of hassles which could be in prospect for them. Really, this awkward tax which could create unnecessary problems would not have been necessary if the government had paid more attention to the management of the revolving fund set up to finance the construction of airports and airport facilities. I suggest the Taj Mahal syndrome, to quote the Minister of Transport, has made this tax, or this source of revenue, necessary.
In 1969 we set up the revolving fund for operating the two eastern airports. Then the Vancouver airport was included. According to what I learned in the public accounts committee, the revolving fund seemed to be working well and was actually generating a surplus. What happens under this government? The revolving fund was working well, apparently, the idea underlying it conforming to the user-pay policy of the Minister of Transport, when, without warning, the government absolutely ruined it, decimated it. It used the revolving fund as the burying ground for a whole series of unnecessary costs. First, it buried the some $500 million cost of Mirabel in that revolving fund. These days, when you ask how much Mirabel cost, it is difficult to obtain a truthful answer. The government will not say how much Mirabel cost it.


William Hillary (Bill) Clarke: It doesn't know.


Arthur Ronald Huntington: It does not know, and there is no way for it to find out. The government has used DREE for these purposes, the airport revolving fund, the Department of Public Works-it has used every little basket, so to speak, available to it to hide the cost of that airport. As well, the cost of the bridge from Vancouver to Sea Island has been hidden in that revolving fund. The government put the $130 million for the Calgary airport under the revolving fund, as well as the Pickering land purchase. Mr. Speaker, by so doing it is destroying the user-pay concept. By so using this revolving fund, that concept will be shattered. The government has really turned the fund into a coffin for its extravagance.
I have been a principal supporter of the user-pay policy which was put forward by the previous minister of transport and continued by the present occupant of that portfolio. But as I note the waste and extravagance of the government, and the unnecessary burden it is forcing our revenue-generators to bear, I cannot continue to support the user-pay concept. Our revenues in this regard should be solidly based, and sound. I think the opportunity to persuade people to accept the user-

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pay concept in this country has been destroyed by this kind of abuse of government structures.
I have not much more to say, except that this tax is being rammed through the House without justification. The Minister of Transport and his staff are aware of the points I have made, but they are not listening to the industry. You would think that the minister, after his experience in withdrawing the northland subsidy on the west coast, would stop persisting in being arrogant and begin listening to suggestions which could have a positive effect in Canada. To me, this airport user-pay tax is contrary to the spirit of the user-pay policy the government has tried to promote in this country.


Mr. Bruce Halliday (Oxford):: Mr. Speaker, 1 rise to bring to the attention of the minister a problem not new to him, since the Minister of National Revenue (Miss Begin) drew it to his attention about a month ago. The question relates to the excise tax on potting soils and mixtures which has suddenly been resurrected. The question was brought to my attention by a constituent, Hillview Farms Limited, who 10 or 12 years ago realized there was a market in Canada for potting soil and potting soil mixtures. The company had to choose between two types of product, a mixture of various inert materials which, by themselves, could not support vegetable life, or a mixture composed partly of soil and partly of inert materials.
It learned from federal authorities that if it used a mixture of soil and inert materials it would not need to pay the manufacturer's sales tax, but if it mixed a number of these inert materials mechanically, in an admixture, sales tax could be charged. On the basis of that information the company consulted an agricultural expert who said that if the company wished to do a service to the Canadian horticultural industry it would opt for the second alternative, a mixture of true soil and certain inert ingredients which would foster the growth of plants. Having the best interests of the consumer and the country at heart, that company started a small operation in which it employed one or two people part-time. It has now grown, employing some 18 or 20 people full-time, and extra help in the summer.
Lo and behold, they were informed this winter, about two or three months ago, by the income tax officials that the income tax people had apparently just woken up from some kind of lethargy or sleep and had just discovered that some ten or twelve years ago legislation had been provided under the Excise Tax Act which called for a manufacturing sales tax on these products. This was news to them, of course, because they had been advised otherwise, and they consulted us about it. We, in turn, informed the Minister of National Revenue. The hon. lady took the matter under consideration and decided that something should be done about it. No concessions could be allowed in this area and I was so informed by her.
At the same time, the minister brought the matter to the attention of her colleague, the Minister of Finance (Mr. Macdonald), who I see is in his place today. We are pleased he is here and are interested to note that he has at least a dozen
of his experts sitting in the gallery. I am sure the hon. gentleman will be able to give us an answer later today or next week, because from such a large batch of experts I am sure he will be able to obtain a good explanation of this problem.
One wonders why the income tax people suddenly found this section of the act when it had been completely ignored for so many years. One wonders whether it was a case that somebody just woke up and realized it was there. On the other hand, it may constitute evidence that there is in Canada a fairly large corporation, a subsidiary of an American corporation, which happens to import into Canada these inert products which are then sold on the market. Because they do not contain any soil they therefore, in accordance with the act, incur tax, and this is as it should be. If this is the case, they may be having difficulty competing with our own Canadian companies which produce a superior product. Perhaps the minister can confirm that pressure has been brought to bear, if not on his department then certainly on the Department of National Revenue, with a view to taxing this particular product, which is now available in Canada, in order to give a better chance to the American corporation with its Canadian subsidiary.
One wonders on what basis the Minister of Finance determines when a tax will apply on products such as soils and soil mixtures. It appears to have something to do with the term "manufacture". I have experienced difficulty in finding out what the ministry means when referring to manufacturing as it applies to soil mixtures and potting soils. These mixtures are nothing but mechanical mixtures. Soil is put with some of these inert materials and they are mixed together. No chemical reaction takes place. Any of the products used in the mixture remains unchanged, and yet for some reason the interpretation placed on the product by the Department of Finance is that the material has undergone a manufacturing process. On the other hand, if ordinary soil is taken and is treated with radiation or some other treatment which changes the soil, removes the bacteria from the soil, or may change it in some other way from its original condition, we then find that no tax applies. It is not considered, in that case, to be manufacturing. Therefore it is very difficult to know precisely what definition is used to arrive at the term "manufacturing".
A fundamental premise also exists, I understand, in the philosophy of the Department of Finance when they are trying to categorise products such as this. If you have a naturally occurring product in bulk and package it for use by the consumer in a smaller, more acceptable form, tax is not incurred. This makes sense, and when ordinary soil is packaged in this way no tax is incurred. But try to do the same with a bulk quantity of soil and add a few inert materials to it. For some strange reason tax is incurred when this mixture is repackaged.
This is not a minor matter, Mr. Speaker. It is one of major significance to many firms across Canada because it is my understanding that not only is Hillview Farms Ltd. concerned about it but that increasing concern is being expressed by the industry as a whole. Organizations such as Flowers Canada, Landscape Ontario, and Landscape Canada are most con-

May 20, 1977

cerned about this sudden imposition or re-incarnation of a tax which has been on the books for years but which had never been implemented. This may signify the efficiency of the government when it has taxes on the books for years but fails to implement them.
There are a number of inconsistencies, anomalies, inequities, and absurdities which relate to this problem, one which itself is something of an absurdity. First of all, it is interesting to note that these materials which are now about to be taxed in Canada can be imported tax free from, say, the United States if they come in containers with a plant or a flower in them. It is an odd situation. One can deduce that a person in Canada who needs potting soil has only to import it from the United States in containers.
There is a second inequity here. We are, in fact, faced with a hidden tax on food. I do not think the Minister of Finance really believes food should be taxed. But this is the situation. If you want to grow some tomatoes yourself, or if you want to grow some cabbage plants or some cauliflower plants, anything like that, for food for yourself you will be obliged, from now on, to pay a tax on the potting soil mixture you will need. It will be an added cost to be considered by all who grow food for themselves.
A third point which should be mentioned concerns discrimination. As we debate this tax bill, meetings are going on in one of our standing committees in relation to discrimination in relation to human rights legislation. Here we have a government which is trying to get away from discrimination in the field of human rights now reintroducing discrimination in another form. In Canada at the present time we have roughly 250 companies manufacturing potting soils of one kind or another. To the best of my knowledge, of those 250 companies the income tax officials have decided to nail only three of them. This is discrimination. They have said, in effect, that these three companies, presumably because they are a little more successful than the others, will be the guinea pigs and will have this reincarnated tax tried out on them. Instead of being fair to all the industries and agencies manufacturing potting soils or soil mixtures, we find the tax department has picked on three and is demanding the tax from them.
To illustrate how ridiculous the situation is and to show how inconsiderate the government is being in the way it has handled this matter, we will, for the sake of argument, concede that the tax is a proper one. We do not believe it is, of course, but let us just concede that for the moment. We have a situation where, in January or February of the year, in midwinter, the income tax people challenge the manufacturer of potting soils and say, "Starting now, you must pay 12 per cent manufacturing sales tax." They do not seem to realize the problems faced by these manufacturers. They do not seem to recognize that they issue catalogues, and plan for months in advance. All their prices are already catalogued, their invoicing and billing are done by computerized systems, and it takes at least three months to change them and costs about $8,000. Some of these companies deliver their soil well in advance, and often do not require payment until many months later. There
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are many complications, all of which the Department of Revenue has decided to ignore.
One further anomaly which I did touch on earlier refers to the fact that you can take ordinary soil and sterilize it, or subject it to radiation, but that does not seem to incur any tax; that does not seem to be interpreted as manufacturing. Take, for example, medical equipment. That is prepackaged, like soil, and does not incur any tax. But if you take ordinary soil and put a little bit of peat moss or vermiculite or fertilizer or other ingredient into it, you end up with what is called a manufactured product, and for some reason you then have to pay tax.
There is also what is known as spent soil. Nurserymen, market gardeners, and mushroom growers use a type of soil which, after a certain amount of use, becomes known as spent soil. For some reason spent soils are not taxable. I have before me a letter from the Minister of National Revenue under date of April, 1977, in reply to a question I put to her, and she has this to say in regard to soils:
Soils in their natural state are not taxable, even when packaged. In the same vein, spent or surplus soils sold by nurserymen, market gardeners, and mushroom producers are also not taxable. These soils have not been processed nor have new characteristics or qualities been added to them prior to their sale-at least to the extent that they could be regarded as being manufactured or produced.
There seems to be something of a caveat there, but who would believe, Mr. Speaker, that a nurseryman, a mushroom grower or market gardener using these special soils had not added something to them? They may have added fertilizer or peat moss or vermiculite, yet according to the way the minister interprets the Excise Tax Act this soil is not manufactured. If a constituent of mine takes the natural products and puts them together, for some reason the end product is called manufactured. I do not know how the minister can explain that anomaly but possibly we will hear from him on the matter later today or sometime next week.
Having described these half dozen anomalies in the interpretation of the Excise Tax Act I should like, in conclusion, to put three questions to the minister to see whether I can bring the matter to a head and obtain some explanation from him. First of all, I presume it will not be the responsibility of the minister, but someone will have to monitor this beastly tax which has been uncovered. It is pretty difficult to decide just what is in soil, dirt. If there is vermiculite or perlite in it, that will be easy to identify, but I challenge anyone to say that soil with a little bit of peat moss or fertilizer or manure in it is different from soil you get out of the ground which has not been so-called manufactured, as the minister says it is.
In other words, how is the minister going to tell when soil has actually been mechanically mixed by some process compared with when it has been taken from the ground and bagged and is thus not taxable? I think the minister, or perhaps his colleague, has opened up a real bag of worms here, which is an appropriate metaphor. I suggest the department will have difficulty deciding whether a given soil mixture was

May 20, 1977
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taken naturally from the ground or mixed together by some mechanical means.
Secondly, supposing a manufacturer of these soil mixtures, instead of combining them together as they are currently in a manner which is helpful to the consumer-obviously this service has been popular in view of the growth from two employees to 20-decides to package each ingredient in his soil mixtures separately so as not to incur tax, or puts all these little packages into one big package, presumably it still would not incur tax. 1 suggest it is ludicrous to think a manufacturer would have to do that in order to avoid this rather absurd and inane tax.
My final question to the minister is this: would he study the question of potting soil and potting soil mixtures from the point of view of all the inequities and anomalies to which I have referred? A very small amount of money is going to be raised from this resurrected tax and difficulty will be caused many businesses in Canada, and undeservedly so. I ask the minister to give consideration to including a clause in the bill to exempt from sales tax potting soil mixtures, top soil, top dressings and other similar products.


Mr. Howard Johnston (Okanagan-Kootenay):: Mr. Speaker, I am happy to have this opportunity to enter the debate on excise taxation. It strikes me that the Departments of Revenue and Finance are still a little too imbued with some of the philosophy which appeared in the Carter commission report some years ago. There is a little too much tendency to say a buck is a buck is a buck, and for the federal government to demand money by way of taxation, as the hon. member for York-Simcoe (Mr. Stevens) suggested was the case with the airline tax, rather than look at ways in which to restrict federal spending, in which case the need to be quite so rapacious in taxation would not be there.
I also hope that in the next budget there will be a thoroughgoing review of federal excise tax, which has been promised us. I hope it will include a move to make the federal share of sales tax a visible, open tax, which the public could recognize each time it makes a purchase. I realize that the Constitution is clear on this point and that the federal government has the right to impose a hidden tax, whereas the provincial governments have not and must, if necessary, impose visible sales taxes. Nevertheless, the practice is detrimental not only to national unity but to the economy of the country.
While this tax review is ongoing I trust that coincident with it an attempt will be made to reconcile the whole sales tax picture with the provinces. Nothing is more detrimental to national unity than varying levels of sales tax imposed, and necessarily imposed, by provincial governments across the country. This problem is particularly acute in British Columbia where the sales tax has risen to 7 per cent, with no sales tax existing in our neighbouring province. The hon. member for Palliser (Mr. Schumacher) made reference to this in his speech. I know the long standing opposition of that province to the imposition of any sales tax, but the distortions which are brought into the economy of the province of British Columbia on its eastern border are so great, and the damage
[Mr. Halliday.)
to business so serious, that a conference between the national government and the provinces should be convened to try to even out sales taxes applied across the country. The federal share of it should be made visible so that the provincial government would not stand out the way it does now when the federal government can escape without the general, daily, every purpose recognition of the sales tax.
I hope the minister, in conjunction with his colleague in the Revenue Department, will instigate a thorough review of the role of the revenue office in retailing within Canada. This is particularly so when it is possible to use zenith numbers to phone, without charge, south of the border to order goods which may well be purchased at a discount price not available to a normal importer who is expected to pay the fair market price. To have those goods landed in a town in the interior of British Columbia and then hand them out on collection of the 121/2 per cent excise tax, but with no collection of the 7 per cent provincial tax, would be an automatic bargain. That may be an additional bargain in lieu of the original purchase price. The competition from the United States to small business in a province with a large provincial sales tax is very, very real. When you have a province that has two undefended borders in terms of the retailing community, it leaves a great deal of discontent amongst those people.
I suspect the Revenue Department is in many ways a long way behind the times in assessing the type and extent of excise tax which should be collected, when it seems quite possible that a manufacturer in the United States can control the wholesaler and can control the retailer and may well own the discount house as well. Thus they are able to discount their own product by dumping it abroad into Canada, which the Anti-Dumping Act does not take into consideration at the present time.
The other area I am concerned about is the area which shows up in regard to crafts. I have had a considerable amount of mail over the last year from people interested in crafts. Certainly the areas I represent in British Columbia tend to have a fairly long tradition of hand made and hand crafted articles which rise to the level of art as well. I am very much concerned about the proposed changes.
I would like to illustrate this with an example that was given to me by a constituent who creates highly original articles which are hand crafted, one of a kind, and which he calls sculpture. I notice he is not alone. 1 have here a copy of the Architectural Digest for May-June, 1977. It is the international magazine of fine interior design. I see an advertisement in that magazine for functional sculpture, signed originals by Gary Gutterman, and sold through a company called Axius in New York City. I do not know how the American excise tax department would categorize functional sculpture, but it certainly exists beyond the mind of the constituent who approached me.
An officer from the Revenue Department approached him at one of the craft shows in my constituency and informed him
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that he was a manufacturer and hence not an artist. He was also informed that he should be paying the federal government sales tax on his items. He objected to that because he felt it was sculpture. Thus, an appeal was made to the customs division of the department with respect to tariff item No. 69515-1.
The Dominion customs appraiser advised my constituent that had these articles been imported they would not have been classified as sculptures under tariff item 69515-1. That misses the point a little because they were not being imported. They were being hand crafted, individually made, one of a kind, and created inside Canada, if you want to use the artistic expression. Why they should automatically fall under any definition for articles being brought in from elsewhere, I do not quite know. They are made within the country, so there is no question of duty. Why this particular suggestion was made about the treatment they would receive at the border if they had been made somewhere else, I do not know.
There is suggestion that some relief is on the way. That suggestion is contained in the statement that was made in the ways and means motion on March 31 of this year. I have the communique from Revenue Canada which sets out two provisions. It somewhat bothers me because it is ambiguous and I am sure the craft industry has not been reassured by what is here.
Before these matters are unchangeable and beyond anyone's power to revoke, I hope the minister will hold the most careful consultation with the people involved in the craft and art industry of Canada. The communique reads as follows:
The Minister of National Revenue, the Honourable Monique Begin, announced today that the regulations prescribing "Small Manufacturers" under the Excise Tax Act, will be amended to increase the annual sales value to $10,000 from the present $3,000. Persons who manufacture goods for sale or for their own use, valued at $10,000 or less annually will no longer have to be licensed or have to account for sales tax.
It continues as follows:
The minister also announced her intention to classify as small manufacturers, craftsmen who personally manufacture or produce by hand various kinds of handicrafts that reflect an aspect of Canadian culture or heritage. There will be no restriction as to annual sales volume for this group.
"Small Manufacturers" as a class are exempt from paying sales tax on the sale price of their finished products, however tax remains applicable to raw materials and components.
I suggest to the hon. minister and his hon. colleague that they will both be in endless trouble if they have two categories of small manufacturers, one being treated more generously than the other but considered a class. That makes no sense at all. It seems to me they need to change the category for small manufacturers, or they will need to introduce a third one which will deal with the artist who creates a sculpture or whatever it is which falls into the category of art. It should not be difficult to set up a board which would be able to distinguish that. It certainly would not be advisable to select the board which has approved some of the recent purchases for the National Gallery because there are some very utilitarian objects on the top floor of the gallery which have been raised to the category of art.
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I would suggest the Finance Minister and the Revenue Minister should have very close consultation with the Secretary of State (Mr. Roberts) in this regard, because their views of what constitutes art are far more stringent than the views which have been held to by the purchasing board for the National Gallery.
I suggest that the second paragraph in this category of small manufacturers-no capitals and no punctuation marks-is going to be unacceptable to the people who regard themselves as true artists or even craftsmen. To find themselves listed as a simple manufacturer does utter violence to the work in which they are engaged.
There should be some consideration of what these people are trying to do. They are trying to fulfil themselves as artists who work with the art that they have chosen as their means of expression. At the same time most of them would like to work exclusively at the art they have chosen. They do not like to be something else such as college lecturers, school teachers, service station attendants or whatever they have to be in today's inflationary society to stay afloat.
These people would like to devote their life to art. If they are lumped as manufacturers the threat will always be there that the change could very quickly be made. Given the government's need for ever-increasing sums of money, it would be very simple to change the regulations with regard to excise tax. Manufacturers would not argue the question at all as to whether it was taken off or not.
I feel that both ministries should be prepared to accept the challenge of defining what can be categorized as a living, earned, true artistic production. Whether it be pottery, sculpture or functional sculpture, there should be room for this. Otherwise these people are forced into the job market, forced to compete at a time of high unemployment, and what looks to be a period of high unemployment for some time in the future.
These people do not want to compete. They do not want to take a job that does not interest them. They do not want a job that deprives them of the opportunity of working in their chosen field. However, sheer financial necessity forces them to do that.
The $10,000 annual sales value is of utterly no help to them. If there is any question here of the amount, it should have something to do with what it costs to live in this country today, because nothing can be made from nothing. All of these people must purchase materials in order to start their creations. Their costs will continue to rise. Very likely they will have overhead costs. Fuel is needed to fire the kilns, and electricity is needed to operate the polishers.
If they sold directly, they might have a hope of making a little. However, if they have to work through a gallery or dealer and pay a percentage, the hope of the craftsman or artist receiving a large share of the $10,000 is virtually nonexistent. It is not easy to live on $10,000. If it were all profit, that would be one thing, but it is not profit. It is sales to the value of $10,000.

May 20, 1977
Excise Tax
By this measure we are forcing virtually every craftsman and artist well below the poverty line, yet taxing them on it. There is some hope in the second paragraph, but it will have to be redefined. Customs officials will be endlessly confused as to what is a small manufacturer and what is not. If a category is capital letters and quotation marks, there is not much criteria there on which they can make their decision. It will end up as in the example I quoted.
The customs officers will apply to the Revenue Department for a definition to determine what they should do with it as it crosses the border. The decision will not have anything to do with the appreciation of the craft and certainly nothing to do with the artistic merit or judgment as to the individuality of the true worth of the art as a contribution to Canada.
There is further hazard with various kinds of handicrafts being exempted if they reflect an aspect of Canadian culture or heritage. 1 am amazed to see that from this government which, for some time, has had the policy or slogan that this is a great multicultural country. Any attempt to define Canadian culture or heritage will be almost impossible. I suspect there will be a different deal for the native Indians of North America or the Inuit people than for anybody else. To define something as having a Canadian cultural or heritage aspect will be very difficult indeed.
These are my concerns about this bill. I urge the minister to have most careful consultation with his colleague, the Minister of National Revenue (Miss Begin). There should be a thorough study of the wishes, concerns and opinions of the people involved in arts and crafts, particularly those involved in creating original objects that have to be looked at individually. There must be room for appeal for the artist who is unique, rare, and individual. In Japan, artists of that nature are classified as national treasures. However, in Canada we seem to have a policy of hoping that our artists will contribute to the national treasure, and there is a world of difference between those two approaches.


The Acting Speaker (Mr. Ethier):: Order, please. Pursuant to Standing Order 37(3), I must advise hon. members that if the minister speaks now he will close the debate.


Donald Stovel Macdonald: Mr. Speaker, we have had a wide ranging debate during the day on a number of issues. Some of them ran not only beyond the bill but beyond the responsibility of this particular department, such as the questions of airport administration, the energy conservation program, and the oil import compensation program. Interesting and important as they are, I do not propose to deal with them this afternoon because, as I say, they run beyond the bill.
The hon. member for Edmonton West (Mr. Lambert) raised a number of points. I appreciate his comments with regard to the increase in the small manufacturers' exemption. The point was made by him and several other members with regard to the level to which it should be raised. I should advise the House that while it has the support on one side for the notion that the level of the exemption should be increased, I and my

department have received considerable representation on the other side of the issue.
There have been objections from other small manufacturers whose volume may be above that of the groups we are talking about here. They regard it as unfair that someone who may, to a degree, be in competition, is exempt from this particular administration. That, of course, is the inevitable problem of trying to line up between what is a reasonable area of operation and what is an undue exemption in this regard. I think we can agree on the fact that at the $10,000 level we are exempting from this kind of administration a very small annual product, one which should not have to bear these costs of administration.
On the question of disability, an important and vexing question, I listened with care to what the hon. member for Edmonton West said. This matter was raised with regard to the Canada Pension Plan. It was raised in relation to the provincial administration, to which the federal government contributes through the Canada Assistance Plan. The question of disability is difficult, and disability is very painful to define with any clarity. However, I take note of the comments of the hon. member, as I took note of the comment he made with regard to marker papers for agricultural aerial sprayers. That question, perhaps, should be considered, as the hon. member mentioned, in connection with the customs tariff. I undertake that it will receive that consideration.
With regard to the air transport tax, there were a number of hon. members who made comments on the tax and on the question as to whether the imposition of this tax or a further extension of it to people who buy their tickets out of Canada and who may be engaged in a flight which causes them to deplane and to depart again from Canada, is going to operate against tourism and against the impact of more travel to Canada.
In general terms one can say that when a person is contemplating a trip by air, which is obviously going to cost several hundreds of dollars, the additional potential maximum of $8 added to the cost of that trip is obviously not going to be a disincentive. If one compares the experience with the first application of the air travel tax in 1975, after the tax was implemented in December of 1974, trans-border air travel by Canadians, which was taxable under the new tax, increased by 11.7 per cent, and other international travel by Canadians increased 9.4 per cent, so obviously questions regarding personal taste, the state of the economy, and other questions will have quite an impact on tourism, but the air tax in itself will not have that impact.
One problem which was very validly raised and which should be a matter of concern is the fact that there is a tax, for example, by the United States government on trans-border travel, and there might be an element of double taxation involved. We recognize that problem and the necessity to try to come to terms with it. Indeed, my officials have arranged
May 20, 1977

with United States officials to discuss this particular question in the very near future.
I think the problem is recognized on the United States side, and there is some hope that we might be able to achieve some kind of compromise between the two tax systems which will be of a beneficial nature.
I would like to put one other interesting statistic on the record in connection with United States visitors travelling to Canada. While there may have been a decline in the number of visitors to Canada in the recent past, that has not been so in the case of air visitors from the United States. For example, in the first quarter of 1977 the number of air visitors from the United States to Canada increased by 3.9 per cent. That indicates that use of this particular mode of travel has been on the increase, although there may have been a plateau of the increase in other areas.
On the broader questions of the Excise Tax Act, of the sales tax and of commodity taxation, there was some reference to the statement in the budget that we proposed to have a discussion in the committee of the commodity tax review which was tabled by my predecessor in his second last budget and which has been the subject of much representation by members of the public.
The hon. member for Vancouver Quadra (Mr. Clarke) stated, as his position and his party's opinion, that they were against too much administrative discretion and administrative action in the course of the application of tax laws in Canada. That is just exactly the problem to which the proposal to shift the sales tax from the manufacturing level to the wholesale level was directed. The proposal is an attempt to try to move to a different level of the productive process which would enable the administration to.be carried forward with less administrative discretion. I wish to point out to the hon. gentleman the difficulty we have had with the public response which came back. The greater proportion of it was an objection to going to the wholesale level rather than directing ourselves to the problem, which we and other hon. members have mentioned over the years, of the necessity for administrative discretion at the manufacturing level. Therefore we hope to have the follow on documents from that commodity study available for tabling by about the middle of next month. It is obviously not a question which will or even needs to be resolved in the immediate future, but it is the kind of important question as to the administrative application of our laws and fair taxation upon which I am sure the finance committee would like to dwell.
I would like to deal for a moment with an argument which was repeated at several points, and that is with regard to the desirability of moving the sales tax right through to the retail sales tax level so that the public would know what it was paying in relation to that particular taxation. The first comment to be made is that it would be difficult in general terms to meet the objective of having all taxes hanging out there so the public would know what is involved. For example, corporate income tax, employer contributions to UIC, Canada Pension Plan or Quebec Pension Plan, property taxes and so on
Excise Tax
are wrapped up in the price of products, and I suppose one would have to wonder why it is necessary to have this particular commodity tax identified. What is so desirable about that when many of the other taxes are going to be hidden in the price of products?
There is in addition a practical difficulty in moving to the retail level. At the present time there are 58,000 licensed taxpayers under the manufacturers level excise tax. Going to the retail level would, it is estimated, increase the number of licensed taxpayers to about 250,000. In other words, it would involve a very substantial increase in the administrative burden which would be involved in carrying out that particular task.
That is a question about which I am sure hon. members will want to think, and I am sure we will have an opportunity to discuss it further when the commodity tax review goes to the committee.
The hon. member for Oxford (Mr. Halliday) raised a question with regard to potting soil. I can inform him that that subject is, as he requested, now under review. I will look at his contribution to this debate again and bring it to the attention of my officials to see if it might be possible to bring about some relief, for the problem which the hon. member has raised, which would be equitable and fair on all sides.
I think that covers many of the principal questions involved. There were a number of specific points raised, such as the point raised by the hon. member for Winnipeg North Centre (Mr. Knowles). I interpreted his remarks as being representations to consider rather than as invoking a specific response at this time, but I can undertake that that will occur.


@Acting Speaker: Is it the pleasure of the House to adopt the motion?


Some hon. Members:: Agreed.


Sinclair McKnight Stevens: On division.


[Stage Direction]
Motion agreed to, bill read the second time and the House went into committee thereon, Mr. Ethier in the chair.
On Clause 1.
Mr. McCain:: Mr. Chairman, on previous occasions when this type of bill was presented to the House, I made requests that there should be some consideration given to certain agricultural requirements which are not considered to be production costs. For instance, the requirements of ventilation and heating, and temperature and humidity control have not been considered as farm equipment. Since this is a very vital part of the farming operation and is essential to sending good produce to the market, what consideration has the minister given to this matter? Has he agreed that it should be characterized as agricultural machinery, or is it still in the category where it is taxable and dutiable but subject to refund after considerable difficulty?


Donald Stovel Macdonald: Mr. Chairman, I would have to seek guidance. I do not know whether I should respond to that

May 20, 1977
Excise Tax
now. Clause 1 deals substantially with the air transportation tax so I wonder whether, in the context of relevancy, I can go on and talk about the other commodities that may be dealt with in the Excise Tax Act.


The Assistant Deputy Chairman:: I think the hon. minister has a valid point and we should address our questions to Clause 1.


Fred Alward McCain: Mr. Chairman, you are ruling, then, that the subject matter is not excise tax but is the specific areas of excise tax with which the clause deals. According to the title of the bill I thought the subject matter was excise tax, but you are disallowing any question on any subject which is not specifically mentioned within the confines of this clause?


Charles Robert Turner: In committee all questions should be relevant to the clause we are addressing. We are on Clause 1 so I do not think there should be questions that would apply to other clauses of the bill.


Sinclair McKnight Stevens: Mr. Chairman, I am rather surprised at the narrow interpretation the minister has chosen to insist on as far as my hon. colleague's question is concerned. Certainly when the customs tariff bill was before us a fairly wide ranging group of questions was answered by the minister, and with our co-operation the minister got the bill through that day. For some reason he seems to have turned quite technical.
I should like to ask the minister what the tax on air travel actually produces. Could he give us some up-to-date figures on what the tax will produce in revenue? I should also like an estimate of what this additional extension will mean in revenue for the federal government.


Donald Stovel Macdonald: Mr. Chairman, for the year 1975-76 the revenue was $53.7 million; for 1976-77 the estimated revenue is $66 million, and the estimated revenue resulting from the amendments would be, on a full year basis, $15 million.


Sinclair McKnight Stevens: During my general remarks on second reading I pointed out that while this is being presented to us on a user-pay basis is something that should be required from those using the airports, were it not for the fact that there has been an increase in expenditures on airports, particularly Mirabel and to a lesser extent the Toronto area airports, this tax would not be needed. Unfortunately, it is somewhat of a deterrent to tourists who want to come to the country.
Could the minister indicate what steps he has taken in his deliberations in cabinet to try to ensure that airport expenditures be restrained so that whatever revenue is produced by taxes such as this will not simply be eaten up?


Donald Stovel Macdonald: Mr. Chairman, it has been the function of Treasury Board in particular to review proposed expenditures by the Department of Transport in the area of airport administration. On the broader question, such as the acquisition of capital properties for further expansion, individual matters will be brought up for cabinet consider-

ation. The scrutiny of expenditures is a Treasury Board process.


Sinclair McKnight Stevens: In suggesting that we accept this tax I wonder if the minister could indicate what comparable taxes there are in the countries that give us our main tourist business such as the United States, the United Kingdom, and European countries, where this tax is presumably to be inflicted upon people using the airports?


Donald Stovel Macdonald: The most relevant country would be the United States where there is a $3 specific tax plus an 8 per cent ad valorem tax without an upper limit. With regard to the EEC countries, there is a whole range of airport taxes imposed at the point of departure, so it is difficult to make a general statement.


Sinclair McKnight Stevens: In the case of the United States could the minister indicate what the proceeds of the $3 tax plus the percentage are used for? Does it go to the federal government and, if so, what do they use the money for?
I am sorry, Mr. Chairman, I missed the minister's reply.


Donald Stovel Macdonald: They are used for airport assistance programs.


Charles Robert Turner: Shall Clause 1 carry?


Some hon. Members:: On division.


[Stage Direction]
Clause agreed to.
Charles Robert Turner: Shall Clause 2 carry?


Some hon. Members:: On division.


[Stage Direction]
Clause agreed to.
Charles Robert Turner: Shall Clause 3 carry?


Some hon. Members:: On division.


[Stage Direction]
Clause agreed to.
Charles Robert Turner: Shall Clause 4 carry?


Some hon. Members:: On division.


[Stage Direction]
Clause agreed to.
Charles Robert Turner: Shall Clause 5 carry?


Some hon. Members:: On division.


[Stage Direction]
Clause agreed to.
Charles Robert Turner: Shall Clause 6 carry?


Some hon. Members:: On division.


[Stage Direction]
Clause agreed to.
Clause 7 to 16 inclusive agreed to.
On Clause 17.
Sinclair McKnight Stevens: Mr. Chairman, it is a little difficult to be sure that the questions I want to put are exactly relevant within the
May 20, 1977

precise limitations the minister has indicated. I should like to get the minister's response to the suggestion that has been put by this party several times that consideration be given to the reduction or elimination of sales tax on energy efficient cars as an inducement and a conservation measure, in the hope that such a reduction would speed production of these cars which are mainly used in Canada. It would be a very welcome thing for people who use them for commuting to work and who like the much cheaper cars.


Donald Stovel Macdonald: Mr. Chairman, we dealt with this previously. The view we have taken is that the purchaser of an automobile should bear some of the cost of government through a sales tax. That is why we feel this is the kind of commodity which should be expected to bear some sales tax. The question is whether we should favour the small car owner by exempting a family who perhaps require two small cars from some kind of tax, or put a penalty on those with an extra large car. We take the view that it is the extra large vehicle which is the problem so we put a penalty on them. We have been interested to note that the United States administration is following our example.


Sinclair McKnight Stevens: I wonder if the minister could indicate what evidence his department has that this is a deterrent. I have had several examples cited to me where people are willing to buy relatively big cars and could not care less about the extra tax. If they want the car they buy it. On the other hand a $300 difference on a relatively small car means a lot to a man on low income.


Donald Stovel Macdonald: Of course with the affluence in our society there are some people to whom the extra $300 is not important. For this reason we put forward this proposal which is now being discussed about an increasing severity of scale against automobiles that are not energy efficient. For reasons I mentioned earlier this year, this question is now being discussed with the manufacturing industry. We expect at some time to put in place an additional deterrent which will be a not negligible factor in the acquisition of energy-using cars.


Charles Robert Turner: It being four o'clock-


Mr. Kaplan:: Mr. Chairman, I rise on a point of order. I suggest that we may consider during private members' hour a motion standing in my name and I would be prepared, if the committee agrees, to postpone consideration of my motion for a few minutes, if that would help the committee to complete its consideration of this bill and perhaps secure its passage on third reading.


Charles Robert Turner: Is it agreed that we shall not see the clock and continue in committee of the whole?


Some hon. Members:: Agreed.
Excise Tax


Sinclair McKnight Stevens: Mr. Chairman, could the minister give the committee figures for the aggregate revenues produced by the automobile sales tax in Canada?


Donald Stovel Macdonald: Mr. Chairman, the sales tax on automobiles runs at between $475 million and $500 million.


Charles Robert Turner: Shall Clause 17 carry?


Some hon. Members:: Agreed.
Clause 17 agreed to.
On Clause 18.


Sinclair McKnight Stevens: Mr. Chairman, could the minister furnish an explanation with respect to subclause (4) on page 10 of the bill; I refer to language reading:
.. . Coin of any metal, of authorized weight and design, issued for use as currency under the authority of the government of any country.


Donald Stovel Macdonald: Mr. Chairman, prior to 1975, Revenue Canada extended these provisions to classify all foreign coins free of duty and sales tax exempt. In 1975 Revenue Canada ruled that foreign coins, other than gold coins, were dutiable and subject to sales tax.
Under the International Monetary Fund articles of agreement, the government has undertaken not to impose restrictions on transfers for current international transactions. Duty and tax on imports of coins in current circulation would seem to constitute such a restriction and could be considered a disguised exchange control. As a result, in December, 1976, order in council P.C. 1976-3019 was passed which remits duty and sales tax on foreign coins. The purpose of this amendment is to deal with this sales tax relief in a more formal manner.


Charles Robert Turner: Shall Clause 18 carry?


Some hon. Members:: Agreed.
Clause 18 agreed to.
On Clause 19.


Sinclair McKnight Stevens: Could the minister say, Mr. Chairman, if the effects of the changes set out in Clause 19 will be to add to or subtract from revenue, or does the government think that the changes as set out in Clause 19 will preserve revenues accruing to the government under the gasoline excise tax?


Donald Stovel Macdonald: Mr. Chairman, the tax levels will be left exactly as they were when they were imposed in March, 1977; therefore these figures should have no effect at all on revenues.


Sinclair McKnight Stevens: Mr. Chairman, may I ask a related question about the ten cents a gallon gasoline tax, which is governed by the Excise Tax Act but is not being changed? Can the minister say what is the total this tax generates, and how much must be spent? In other words, what is the current revenue accruing to the government under this tax, what is the total expenditure made under it, and what is the surplus or deficit, as the case may be?

May 20, 1977
Excise Tax


Donald Stovel Macdonald: Mr. Chairman, in the 1975-76 fiscal year, the net total of refunds was $425.1 million. Of course the total expenditure cannot be categorized if the funds are paid into the Consolidated Revenue Fund. They contribute both to the oil import compensation fund and to the financing of the various energy development projects which the federal government has undertaken.


Sinclair McKnight Stevens: Mr. Chairman, could the minister indicate what is the refund portion of the expenditure which has been claimed by Canadians?


Donald Stovel Macdonald: Mr. Chairman, I am sorry, I do not have that figure available today.


Charles Robert Turner: Shall clause 19 carry?


Some hon. Members:: Agreed.
Clause 19 agreed to.
Clause 20 agreed to.


[Stage Direction]
Title agreed to.
Bill reported.
The Acting Speaker (Mr. Ethier):: When shall the bill be read the third time?


Stanley Howard Knowles: By leave, now.


Donald Stovel Macdonald: that the bill be read the third time and do pass.


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


Mr. Paproski:: On division.
Motion agreed to and bill read the third time and passed.


Donald Stovel Macdonald: Mr. Speaker, I rise on a point of order. I understand, from discussions held earlier today, that there might be some disposition to allow me to make my second reading remarks on the Bretton Woods Agreement Act. I believe my colleague, the hon. member for York Centre (Mr. Kaplan), would be agreeable to that. Am I mistaken?


Mr. Fairweather:: You have done pretty well today.


Steve Eugene Paproski: Have a good weekend.


The Acting Speaker (Mr. Ethier):: It being four o'clock, the House will now proceed to private members' business as listed on today's order paper, namely, notices of motions, public bills, private bills.


PRIVATE MEMBERS' MOTIONS
Steve Eugene Paproski: Mr. Speaker, I rise on a point of order. I believe there is a disposition to consider motion No. 29, in the name of the hon. member for York Centre (Mr. Kaplan), and allow the other preceding motions to stand at the request of the government.


The Acting Speaker (Mr. Ethier):: Is this agreed?


Some hon. Members:: Agreed.


The Acting Speaker (Mr. Ethier):: It is so ordered.


EXTERNAL AFFAIRS
Robert Phillip Kaplan: That the Helsinki Agreement be referred to the Standing Committee on External Affairs and National Defence to obtain evidence of the extent to which States signatory thereto have observed their obligations contained in basket 3 (human freedoms) and that the Commission have power to travel from place to place within Canada to hold public meetings on this matter.
He said: Mr. Speaker, in August, 1975, an historic agreement made by European and North American powers was signed at Helsinki, Finland, settling some questions of security and co-operation. A number of political issues were resolved at Helsinki dealing with questions which remain highly contentious so far as some Canadians are concerned. Some states were not represented by governments of their peoples, or by what we, in our democratic country, consider as governments.
I did not place this motion on the order paper in order to discuss the validity of the Helsinki agreement on those grounds. Actually I am not rising to object to the Helsinki Agreement. On the contrary, I shall address my attention this afternoon to the implementation of the Helsinki Agreement.
In signing the Helsinki Agreement, the Government of Canada has often stressed how important it considers assurances given by other countries of their co-operation in humanitarian and other fields. The undertakings with respect to such co-operation are often referred to as the Basket III provisions of the Helsinki Agreement. In a moment I shall examine some of the issues relating to Basket III to the Helsinki Agreement. Before I do that, let me remind the House of the importance of the issues I intend to raise. Their importance is this: on June 15, 1977, a conference is to be convened in Belgrade, Yugoslavia, to deal with the implementation of the issues I intend to raise. Their importance is this: on June 15, 1977, a conference is to be convened in Belgrade, Yugoslavia, to deal with the implementation of the Helsinki Agreement. I have a copy of the agreement with me and will note and refer in detail to specific undertakings given by states signatory to the Helsinki Agreement as to follow-up. They agreed, on June 15, to
May 20, 1977

declare their resolve, in the period following the conference, to pay due regard to and implement the provisions of the Final Act of the conference unilaterally, in all cases which lend themselves to such action; bilaterally, in all cases which lend themselves to such action; bilaterally, by negotiations with other participating states, and multilaterally. I want to emphasize the agreement which was made that beginning in August, 1975, the members would unilaterally, where they could, implement the undertakings contained in the Helsinki Agreement.
Less than a month from now there will be a meeting in Belgrade, as called for in this document, to review, among other things, the extent to which states have unilaterally implemented the measures and the promises they solemnly made in Helsinki in 1975.
The resolution I tabled last November called for the external affairs committee to travel across Canada receiving briefs from witnesses who would give evidence about the extent to which these undertakings had been observed. If my resolution had been accepted, these hearings would have taken place and the ground work would have been well prepared, but at this point, with less than a month to go, it is hard to imagine that even with the support of the House for the resolution the external affairs committee could carry out such a mandate. Nevertheless, I wish to defend this resolution because 1 assert that if it had been passed in time, and if that tour had taken place, we would be in a much better position at Belgrade in June to deal with the question of the extent to which member states had implemented their undertakings. I wish to refer particularly to the countries of the Soviet Union and the extent to which they have honoured their obligation to carry out unilaterally the promises they formally, solemnly, and in writing agreed upon in Helsinki.
Canada is a country made up of immigrants. I understand that since the Second World War one tenth of all the immigrants who have come to this country have been refugees, often leaving their families. It is typical of immigrants to Canada that they leave members of their families in other parts of the world. So it is proper, totally to be expected, and very Canadian, that this parliament should be concerned about the important question of the reunification of families. In the limited time which I have, I propose to deal with only one small provision in the third basket, the undertaking of the Soviet Union to promote the unification of families, and its agreement that it would unilaterally implement such an undertaking.
If we had inquired across the country we would have learned a great deal. We would have been able to go to Belgrade with many, many cases of both compliance and non-compliance with its undertakings on the part of the Soviet Union. I have many cases before me, partly because I have the honour to represent a very large number of landed immigrants who have come to these shores from the Soviet Union, many of them in the last five or six years. A large number of these have families
Human Freedoms
still living in the Soviet Union and they are asking for the benefit of the Helsinki Agreement.
What is the specific provision to which I should like to draw attention? It is the provision which envisages contacts and regular meetings on the basis of family ties. There are two parts to this. One is an agreement about visiting-family members visiting each other across boundaries. The second has to do with settlement-the right of families to be unified. Let me deal with that briefly.
The Helsinki Agreement provides that in order to promote the further development of contacts on the basis of family ties, participating states will favourably consider applications for travel for the purpose of allowing persons to enter or leave their territory temporarily, and or on a regular basis if desired, in order to visit members of their families. Then there is a reference to the reunification of families where families wish to be reunited permanently. The provision is that the participating states shall deal in a positive and humanitarian spirit with the applications of persons who wish to be reunited with members of their families, with special attention being given to requests of an urgent character.
Dealing with these matters in a positive and humanitarian spirit might, indeed, result in reunification in particular cases. But even with good faith being shown by a government, reunification might not be able to take place. However, the language used there-"dealing in a positive and humanitarian spirit" is quite different from the language used in the case of travel. The participating states say they will favourably consider applications to travel for the purpose of temporary visits.
Let me, then, confine myself to the undertaking of the Soviet Union to consider favourably applications to travel for the purpose of family reunification. In my office alone-and I am only one member of parliament-I have notes of more than a dozen cases of elderly relatives in the Soviet Union who have applied to visit temporarily their relatives in Canada and who have been turned down, in spite of the fact that the Soviet Union was prepared to undertake solemnly that it would favourably consider applications to travel.
I should like to tell the House about just one case, the case of Freda Schafirovich who lives in the Ukraine. She is a widow, 70 years old. She lives alone. Her husband was a war veteran who died defending the Soviet Union against fascist invaders in the Second World War. Not only was her late husband a veteran who served actively and with distinction, but she herself was a war veteran who was wounded in the defence of her city and was honoured for her valiant participation. Perhaps I should say, parenthetically, that the Schafiro-viches were Jewish. When they were defending their country against the fascist invaders they knew what they were defending it against. Perhaps there was never a moment in history when Canadians, Americans, and all free people around the world felt a closer bond than in those terrible days when the Schafiroviches and hundreds and thousands, even millions, of Soviet citizens were rebelling and helping defeat the forces of fascism.

May 20, 1977
Human Freedoms
Mrs. Schafirovich, 70 years old this year, has been trying unsuccessfully for five years to visit her children who live in my constituency in the city of Toronto. Five years ago she received a visa from the Canadian government giving her permission to come to Canada as a temporary visitor, which was all she was asking. She intends to return to the Soviet Union. She applied under the normal procedure for permission from the Soviet authorities to leave that country temporarily. She did not receive a written reply or have anything she could show her son. She was called in and told to forget it, that she would not be allowed to be reunited with her son in Canada.
I have seen Mr. Schafirovich a number of times. I saw him before 1 went to the Soviet Union. When I went to the Soviet Union I had the opportunity of meeting with Chairman Pod-gorny, Chairman of the Supreme Soviet in the Soviet Union. I asked him about Mrs. Frida Shafirovich and when she was going to be allowed to come and visit her son who is living in my constituency, and said she had applied for a temporary visa. He said he would look into it. I understand that Mrs. Schafirovich was called in again. This 70 year old woman, a widow and wounded war veteran, was told to forget it, that she would not be able to visit her son.
Recently a friendly delegation of Soviet parliamentarians came to this country. The son, Arkady Schafirovich, came up to Ottawa and I took him to the Speaker's dining room and introduced him to three or four members of that delegation. They spoke together in Russian and he asked them to see what they could do to get permission for his mother to visit him temporarily in Canada. They took down the details and said they would look into it. They returned home, called in this 70 year old woman and, I understand, told her that she was not going to get to visit Canada to see her son.
I am not a supporter of communism; members of the House know that. But I do know there are many supporters of communism in the world, particularly in the Soviet Union. I should like to know, what does it do for the cause of communism, for socialism as they see it, for the kind of society that they want to establish, to tell a 70 year old Jewish lady, a veteran who fought in the Second World War, that she cannot make a temporary visit to her son?
Since the Schafirovich incident began, a meeting was held at Helsinki. 1 have referred to this one case but there are hundreds, maybe thousands, of Canadians who look to the Helsinki accord for assistance. They do not like the politics of it or the idea of boundaries being drawn around people who were not being democratically represented at the bargaining table when this agreement at Helsinki was settled, but nevertheless, they know about Basket III and they know that the Soviet Union put its signature to an agreement providing that the Soviet Union would favourably consider applications for travel for the purpose of allowing persons to enter or leave their territory temporarily and on a regular basis, at the option of the citizen, in order to visit members of families.
I have told hon. members about the Schafiroviches. I could have told them about a dozen elderly people in the Soviet
(Mr. Kaplan.]
Union who are seeking permission to visit their children in my constituency. There are others who wish to visit their children in other parts of this country, and still others who want to come and settle here, as is also provided for in this agreement. I do not know what the communists are trying to prove. I do not know what possible credit it does to the great revolution which they see themselves as leading when elderly people are now not allowed to be reunited with their children.
1 suppose the most noble and powerful concept I have heard of is the notion of the family of man. We are one family on this planet. We have a responsibility to each other. I believe that the notion of the family of man, this dynamo in the world of ideas, calls upon us to condemn actions like this. I will not be satisfied if the Canadian government goes to Belgrade and fails to bring forward the dozens, indeed hundreds of cases of people who want to visit this country to see their children. I will be very disappointed if the Canadian government goes to that conference and fails to raise the Schafirovich case, as well as the hundreds of other cases where individuals are asking the Soviet Union for permission to visit relatives.
Let us forget about the declaration of human rights, Mr. Speaker-an impressive document, but perhaps it is too stale for the Soviet Union these days. Let us just talk about the Helsinki Agreement and the simple black and white undertakings made at that time to recognize the nature of the family of man.
I cannot say that I will be disappointed if the government prevents this resolution which 1 have proposed today from coming to a vote. I understand the difficulties it would entail at this late date to launch a parliamentary committee across the country to hear from all the Schafiroviches, not just the ones in my riding but those right across the country. I wish the government had of its own initiative, when this idea was first raised, organized that kind of participation by the Canadian people. But I am not going to criticize the government for that decision because I want to wait and see what it does at Belgrade when the Helsinki Agreement is reconsidered. I want to see what kind of evidence is put forward of the extent to which the signatory states to the Helsinki Agreement have observed their undertakings. I see my time has expired, Mr. Speaker.


Mr.  R. Gordon L. Fairweather@Fundy-Royal: Mr. Speaker, I was glad to be asked to speak for my party on this motion. It says something about parliamentary time, as the hon. member for York Centre (Mr. Kaplan) has said, that events have caught up with the purport of his motion. However, 1 am not quite as discouraged as he seems to be about the Department of External Affairs and the list within that department of people who have been brought to the department's attention by members of parliament, and by families from one end of the country to the other. As a matter of fact the department gave a most extraordinarily frank statement to the external affairs committee on Basket III and the monitoring system that has been set up as a result of the Helsinki Agreement.
The particularly moving story that our colleague has reported concerning the mother of a constituent of his and his
May 20, 1977

question about why the might of the Soviet Union should be brought to bear on a 70 year old widow seems to me a matter that we must continue to raise. We can all cite examples of this sort of thing.
The Soviet Union and its government is frightened by the concept of freedom. It is frightened by the concept that mothers can visit their sons in other parts of the world. It is frightened by the concept that a journalist can go to and fro within that country. Its satellite countries are busily locking up journalists, including Canadian journalists, who dare report on the move toward freedom. We cheer, as freedom lovers all over the world cheer, when we learn about the catalogue of heroes coming forth to speak out against totalitarian regimes. This is the antithesis of the Soviet system, that huge country known as the super power. It has, as senior officials of its government, parliamentarians who are the sycophants of that government. They are elected from a list and know no dissent. That group is unable to cope with the simple act of family reunification. I do not mean to be self-righteous, and God knows we have our difficulties, but it would not take a group of members of this House to see to it that sons can visit mothers and mothers visit sons, or families have an opportunity to get together.
I feel rather hopeful about Helsinki, if we keep the truth in front of the world. I think the human rights basket was made a condition of the eastern bloc being able to institutionalize the boundaries of the Second World War.
Members of parliament and agencies of government have to keep on monitoring occasions when undertakings in Basket III are not fulfilled by the signatories to this treaty. I am sad to think there will be many such occasions. Our hon. friend has given us an example and he has said there are many others. Parliamentarians from all parties have raised this from time to time. We should have the opportunity to think beyond the boundaries of our country occasionally. This is an illustration that we can do this once in a while.
We think of names like Valentyn Moroz, a man who is being held now because the Soviet Union cannot stand having a Christian preaching the gospel. Imagine the whole engine of the state of the Soviet Union quivering, and putting a man in jail because he professes his belief. I am somewhat optimistic about Basket III. We do not need, in espousing the cause of human rights, to overstate the case. The case is well stated in hundreds of precedents through the United Nations and other times in history when men have espoused the cause of human rights.
The Belgrade meeting next month is embarrassed by Basket III. The Soviet bloc do not want to discuss the things which our colleague has been discussing today. They would rather forget the people within their boundaries who cannot see their sons, and forget the people they have put in jail because of their beliefs. I am anxious for us not to get into the language of the Cold War, which was a particularly trying time for freedom lovers. I know we all have the perspective of looking back, but it seems to me some things were done in the western
Human Freedoms
world which echoed the intolerance of the Soviets. It was not echoed in totality, but they did echo some of the statements and techniques which are now being used in the Soviet Union and its satellites. We should keep telling the truth.
Our hon. friend has introduced sections of the Helsinki Agreement into this debate. There are examples of human beings who have suffered because the agreement was not lived up to by others. We cannot continue stating the case without trying to roll back communism and going to the brink, and some people are prepared to go to the brink. We should not use the outlandish phrases of the fifties. The brink I am referring to is not only in intellectual terms but the brink of their thinking. Perhaps I have not put that too well. What I am trying to say is that we have the case on our side in the sense that the document is there. If the document is not fulfilled, we should tell the world so.
When the departmental officials and the minister go to Belgrade, they should take the entire Helsinki Agreement with them. We should never consider going to Belgrade without it. We cannot be selective in the western world and agree to look at parts of that agreement. We have to look at the complete agreement.
Despite Berlin walls, despite all the boundaries, and despite the suspicion of the eastern bloc, mankind's ingenuity in technological terms is soon going to surmount this in freedom of information. Whether the Soviet Union likes it or not, we are on the threshold of developing a system of receiving information via satellites. That is going to confound boundaries and confound suspicious people who head totalitarian regimes. Although families may not be reunited, in the future there will be information about the west-how the west lives, and how we care very deeply about the thousands of cases which are caught under the basket of the human rights provisions. People who want to find out the truth can get the truth in technological terms. We are in a curious situation because some technology seems to be the antithesis of humanity. However, humanity is well served in this case because all people do inhabit a global home, and technology is going to make this known to all the inhabitants of the earth. The inhabitants of the earth are going to know when a super power is unable to let a 70 year old woman visit her son.


Mr. Fernand E. Leblanc (Parliamentary Secretary to Secretary of State for External Affairs):: Mr. Speaker, hon. members will probably recall that the Final Act of Helsinki was signed on August 1, 1975. It is a unique document in many respects. It is the result of a process which, from the outset, the Soviet Union only meant to be a simple effort to obtain international recognition of the status quo in post-war Europe, but which led to a conference dealing with much broader problems: the Conference on Security and Cooperation in Europe. Not only did that conference reiterate established principles which acknowledged the possibility of changes in inter-state relations, but it also gave a humani-
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tarian scope to those relations. It considered human rights and each state's treatment of its own citizens as issues which are not only negotiable, but also likely to influence international relations.
In the first basket of the final agreement, principle VII of the "Declaration on Principles Guiding Relations between Participating States" is particularly enlightening in that regard. I quote:
The participating states recognize the universal significance of human rights and fundamental freedoms, respect for which is an essential factor for the peace, justice and well-being necessary to ensure the development of friendly relations and co-operation among themselves as among all states.
This principle was agreed upon thanks to the perseverance of the western nations, as well as the provisions contained in the third basket on "Co-operation in humanitarian and other fields", which deal with some specific aspects of human rights, as for example the free circulation of persons and the free diffusion of information. Hon. members will undoubtedly recall that the Canadian delegation in Geneva put forward the proposition which is the basis for the provision contained in the third basket about the reunification of families. One must not wonder why Canada is interested.
I wish to draw hon. members' attention on the content of the third basket, which is the subject of the motion before us. It does not contain the basic declaration of the final act, respecting human rights, which is to be found rather in principle VII of the first basket, as I already said.
As for the third basket, it deals with certain points which I enumerate in detail to avoid any confusion with the provisions of a more general nature contained in the first basket as far as human rights are concerned:
1.	Human contacts namely:
(a)	contacts and regular meetings on the basis of family ties;
(b)	reunification of families;
(c)	marriage between citizens of different states;
(d)	travel for personal or professional reasons;
(e)	improvement of conditions for tourism on an individual or collective basis;
(0 meetings among young people; and
(g) sport.
2.	Information, namely:
(a)	improvement of the circulation of, access to, and exchange of information
(not only oral but also printed, filmed and broadcast information);
(b)	co-operation in the field of information; and
(c)	improvement of working conditions for journalists.
3.	Culture, i.e. contacts and exchanges in the fields of cinema, theatre, music, opera, ballet, plastic and graphic arts, books, copyrights, translation, etc.
4.	Education, i.e. fields of activity like science, foreign languages and civilizations, and teaching methods.
In view of the large interest those aspects of the final act have for the Canadian public, it is important to know what are its views on them. In fact, it is essential that the Canadian delegation to the meeting subsequent to the CSCE, to be held in Belgrade later this year, be fully aware of the Canadian public's position with regard to the CSCE and the third basket, and have all the factual information which can be provided to them by individuals as well as organizations.

The government has been receiving mail on that matter for quite some time already. Almost every letter relates to the way countries of Eastern Europe are behaving. In some cases, they do not provide for any precise information and they even go as far as accusing some countries of violating sections of the final act of Helsinki which do not even exist. What the Canadian delegation needs is precise, accurate and well documented information.
During a meeting with leaders of the allophone communities in Toronto held February last, the Secretary of State for External Affairs (Mr. Jamieson) invited them to express their points of view and to meet senior officials in his department. Some verbal statements and written briefs have already been presented not only to high officials but to the minister himself. We are expecting some more.
The views of the allophone communities represent, of course, only a part of a larger group and the Department of External Affairs is open to any kinds of contributions. Incidentally, he has recently invited some representatives of the university community in Ottawa in order to hear their views on the application of the final act of Belgrade.
The department also receives on a regular basis some information on the compliance with the final act by other countries from other Canadian departments, from its missions abroad and from all those, including high officials, who took part in what is in fact a continuous process of consultations between the signatories to the CSCE and the final act. One can say in that regard that process was initiated right after Helsinki and was followed up since then on a continuous basis.
Right in our department, a small section was established a few years ago to get ready for the CSCE and co-ordinate the activities of various governmental services in that area. It also dealt with the way Canada is itself complying with the provisions of the Final Act.

In view of the extensive activity already being carried out by the government, there is some question whether there might not be a certain duplication of effort in having the standing committee take on a similar activity, especially at this time.
The motion under consideration should be considered in the context of the present heavy workload of parliamentary committees and the responsibilities they are already called upon to discharge before the end of the current session. I have been informed that at least 12 bills must be considered by six or seven committees in the next month. With such a load on hon. members' time and committee resources, a thorough and useful investigation by the standing committee would be difficult to hold in Ottawa, and next to impossible to hold in all parts of the country. I feel that the aims of the motion are laudable, but pragmatic questions of logistics must be considered.
Preparatory meetings begin in Belgrade in less than one month, on June 15, and the main meeting is scheduled for October of this year. We are dealing with very serious issues here. There is a real danger that committee hearings at this
May 20, 1977

time, and within these time constraints, would be hasty, incomplete, and superficial.
The preparatory organization of the committee's work, the actual hearings, the verification of information, the follow-up work, and the necessary co-ordination with the Department of External Affairs-all these essentials steps make it doubtful that hearings envisaged under the motion could make the practical, positive contribution to our representations at Belgrade at which we should be aiming.
There is another very important point which I have not yet touched on, and that is the limited scope of the motion. I fully appreciate the reason why attention has been focused on Basket III, but it should be borne in mind that there are many subjects covered by the Final Act, and just as Canadians may be interested in only certain aspects of the document, others will be interested in different parts. We cannot afford to ignore those other parts. All the principles have to be read in conjunction with each other, and the three substantive baskets of the Final Act have to be read together, particularly as the commitment of the Canadian government is to the whole Final Act and not just to Basket III.
Hearings which concentrated only on Basket III would fail to come to grips will all the problems which will have to be faced at Belgrade. At the same time, if the standing committee were to do a proper job on the whole Final Act, the task it would have to take on would be an enormous one to try to accomplish within the time frame allowed. I put these thoughts forward for the consideration of the House.


Stanley Howard Knowles: Mr. Speaker, I shall take only a moment so that the hon. member for Scarborough East (Mr. O'Connell) can still make his contribution. I should simply like to say that even though events since last November may have overtaken the precise suggestions contained in the motion put down by the hon. member for York Centre (Mr. Kaplan), I want to join in congratulating him for having presented this motion and making possible the discussion which has taken place this afternoon.
Human rights everywhere in the world are of deep concern to all of us. It is a subject about which we must speak out when those rights are violated, and on behalf of my party I support very strongly the spirit and the intention which led the hon. member to put this motion down for debate today.


Hon. Martin O'Connell (Scarborough East):: Mr. Speaker, I shall be equally brief, and I thank the hon. member for allowing me to have a few moments. I see that the hon. member for Trinity (Miss Nicholson) would also like to speak.
I want to congratulate the hon. member for York Centre (Mr. Kaplan) for bringing forward this motion. I regret that time has telescoped on us so much, but this Belgrade conference was only one of what surely must be many, and I think the idea that a reference be made to that committee is a sound one. I think too that we ought to state in this House that the Secretary of State for External Affairs (Mr. Jamieson) should
Human Freedoms
include in the delegation going to Belgrade some representatives of the House of Commons so that we at the political level will know what is going on there, and so that we can assess the progress of our own efforts to pressure for progress in that respect. I think too that we should have representatives at Belgrade from non-governmental organizations, and that they in turn should include Canadian citizens who have come from those countries which are denying family reunifications and visits: the U.S.S.R., Czechoslovakia, Poland and others.
We are having our noses rubbed into the Helsinki Agreement, principally by the U.S.S.R. but not just by it. Why can we say that? Well, our government signed the agreement. That agreement included pledges that Canadian citizens would receive visits from their relatives behind the Iron Curtain and that those visits would be facilitated. I too have dozens of such cases in my office. I have not had one success as a result of my representations. We are having our noses rubbed into the agreement which we signed. We were party to it, and therefore I think it is in our interest to negotiate criteria at Belgrade which would ensure that we can respond to citizens. Therefore, I think we ought to be represented at Belgrade.
Mr. Speaker, I will yield to the hon. member for Trinity.


Miss Aideen Nicholson (Trinity):: Mr. Speaker, since there are only a few minutes left before the time for this debate ends, I just want to say very briefly that I support the intent of the motion of the hon. member for York Centre (Mr. Kaplan). Because the inclusion of Basket III in the Helsinki Final Act was a Canadian initiative, we have a particular responsibility to monitor it. Like other hon. members who have spoken, I hear daily from my constituents of countless examples of people who cannot come here for a simple family visit, about elderly and sick people who cannot be reunited, although that was a specific recommendation in the Final Act and about unconscionable interference with the mails, with gifts and with these simple matters which help families to keep in touch.
The hon. member for Fundy-Royal (Mr. Fairweather) in his usual thoughtful way reminded us of the importance of conducting our negotiations at Belgrade in a way which is not counterproductive, which does not involve unnecessary confrontation, and which keeps the emphasis on the whole agreement, not just on Basket III. I think his point is well taken, but I also think Canadians know a lot about how to make a point firmly but politely. We can keep the door open for negotiation, but we must also state very clearly the cases and examples of blatant interference with the rights of people in their own countries which we know.
Some of the worst abuses of human rights now are perpetrated by governments against their own nationals, and while we cannot interfere with the internal matters of other countries, in the Helsinki Final Act some 35 governments have voluntarily taken a position and made a commitment. With this important agreement we can continue to expect governments to be accountable for that to which they have committed themselves.
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May 20, 1977
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Another important factor is the continuing involvement of parliamentarians, and I would like also to support the recommendation of the hon. member for Scarborough East (Mr. O'Connell) that members of parliament be closely involved with all the negotiations.


The Acting Speaker (Mr. Ethier):: Order, please. The time allotted for the consideration of private members' business has expired.


Mr. MacGuigan:: Mr. Speaker, I rise on a point of order. I believe there would be unanimous agreement to revert to "Reports from Standing and Special Committees."


Some hon. Members:: Agreed.



ROUTINE PROCEEDINGS


[Stage Direction]
Fifth report of the Standing Committee on Justice and Legal Affairs-Mr. MacGuigan.
[Editor's Note: For text of above report, see today's Votes and Proceedings.]
The Acting Speaker (Mr. Ethier):: Order, please. It being five o'clock, this House stands adjourned until Tuesday next at 2 p.m., pursuant to Standing Order 2(3).
At 5 p.m. the House adjourned, without question put, pursuant to Standing Order.

Tuesday, May 24, 1977