1977-03-31

ROUTINE PROCEEDINGS


Mr. Waiter Baker (Grenville-Carleton):: Mr. Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43. In view of the now obvious shortcomings of the government's bilingualism program, which has been documented by successive reports of the Commissioner of Official Languages, I move, seconded by the hon. member for Edmonton-Strathcona (Mr. Roche):
That a select committee of this House be struck to investigate the administration of the bilingualism program and report back to this House its findings and conclusions by the end of 1977.


Mr. Speaker:: Pursuant to Standing Order 43, the 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. Cyril Symes (Sault Ste. Marie):: Mr. Speaker, I rise to move a motion under the provisions of Standing Order 43. In view of the recent decision by the Minister of Manpower and Immigration (Mr. Cullen) to grant political asylum to a Rumanian canoeist who defected at the recent Olympics, and in view of his department's decision to deport a Chilean refugee Mr. Pedro Denegri a former Chilean government official who faces immediate arrest and persecution by the fascist regime in Chile if he is deported, I move, seconded by the hon. member for Nickel Belt (Mr. Rodriguez):
That this House urge the minister to review the deportation decision on humanitarian grounds with the view to allowing this political refugee landed immigrant status in Canada.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


CONFEDERATION
Mr. Lionel Beaudoin (Richmond):: Mr. Speaker, under the provisions of Standing Order 43, I ask for the unanimous consent of the House to move a motion dealing with a matter of pressing necessity.
Considering that all hon. members receive a great many letters from Canadians who wish to take part in the process of renewing our confederative alliance; considering that inconsistent information from governments or organizations reaches us every day in exchanges about the profitability of federalism; and considering that this is a basic matter and that we are now witnessing a polarization of opinions based on conflicting aspects, I move, seconded by the hon. member for Abitibi (Mr. Laprise):
That the House take the lead in this matter of Canada's future by suggesting to all provincial or territorial governments the establishment of an independent non-political committee made up of one or several representatives of each party involved to consider seriously and realistically the future of Canada, the profitability of our federalism and the true desires of all partners in Canada today.


Mr. Speaker:: Order. The House has heard the motion of the hon. member. Under the provisions of Standing Order 43, this motion requires the unanimous consent of the House. Is there such consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.

March 31, 1977
Post Office


VETERANS' LAND ACT
Mr. Jack Marshall (Humber-St. George's-St. Barbe):: Mr. Speaker, I too, wish to move a motion under the provisions of Standing Order 43. Today, March 31, marks the final phasing out of the Veterans' Land Act, an act which has provided for the establishment of 143 veterans since its inception. I move, seconded by the hon. member for Portage (Mr. Masniuk):
That this House orders the record to show that as a result of the extension of the act through the efforts of the opposition, 1,291 new small holdings, 13 new farm establishments, 591 new homes and 3,105 additional loans were approved for some 5,000 veterans at no extra cost to the public.


Mr. Speaker:: Order. The'hon. member for Selkirk.


SUGGESTION THAT DISTRIBUTION OF PUBLICATION &quot;SEX EDUCATION&quot; BE STOPPED-MOTION UNDER S O. 43
Mr. Dean Whiteway (Selkirk):: Mr. Speaker, I too, rise under Standing Order 43 on a matter of urgent and pressing necessity. In the light of a statement contained in booklet No. 4 of a packaged series entitled "Sex Education" that abortion is an acceptable form of birth control in Canada, and in view of the fact that this is clearly contrary to the Criminal Code, I move, seconded by the hon. member for St. John's East (Mr. McGrath):
That this House direct the Minister of National Health and Welfare to immediately stop the printing and distribution of the series called "Sex Education".


Mr. Speaker:: Such a motion under the provisions of Standing Order 43 can only be presented by unanimous consent. Is there such consent?


Some hon. Members:: No.


POST OFFICE
Mr. John Rodriguez (Nickel Belt):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. In view of the fact that the Postmaster General has recently announced to Canadians that another strike in the Post Office would result in the complete dissolution of federal postal services; in view of the fact that recent internal studies of post office middle management indicate that the bulk of the problems in the Post Office originate there, and in view of the fact that even now management in local Post Offices is violating the spirit, if not the

letter, of the collective agreement with Canadian Union of Postal Workers as evidenced by recent strikes in St. John's, Newfoundland, I move, seconded by the hon. member for Sault Ste. Marie (Mr. Symes):
That the Postmaster General immediately undertake to clear up the confusion existing in top and middle management in the Post Office, establish clear lines of authority and instruct management at all levels in the Post Office to abide by the collective agreement between the Post Office and the CUPW.


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


Some hon. Members:: No.



ORAL QUESTION PERIOD


Walter David Baker: Mr. Speaker, my question is directed to the Prime Minister and it relates to the report tabled yesterday by the Commissioner of Official Languages in which the commissioner appears to conclude that while the body of bilingualism is healthy, the soul of the program is ill. In the light of Mr. Spicer's statement yesterday which, in the commissioner's own words, "Lays the alienation from the language question in western Canada squarely at the government's doorstep", will the Prime Minister tell the House what steps he intends to take to correct the government's divisive handling of the bilingualism policy?


Right Hon. P. E. Trudeau (Prime Minister):: I regret not having read that report. I am sure it is an excellent one. I can only comment on the basis of the question I was asked. If the commissioner singled out western Canada as an area in which we have failed to explain this policy, I think it is simply because of the fact that there are more Conservatives than Liberals out there.


Some hon. Members:: Oh, oh!


Walter David Baker: The Prime Minister is right when he hesitates and says the program is a failure. In his report, Mr. Spicer stated that one of the most significant reasons for the failures which have compromised the program was the conspicuous lack of constant high level direction. Will the right hon. gentleman tell the House whether he agrees with this assessment and, if so, what steps he is taking to change the nature of the insensitive administration which has plagued both the program and the country?


Pierre Elliott Trudeau: Mr. Speaker, that sounds more like an argument than a question.


Mr. Paproski:: Are you the Speaker, too?
March 31, 1977


OFFICIAL LANGUAGES ACT
Walter David Baker: A supplementary question, Mr. Speaker. That was a question and the Prime Minister knows it was a question. In this report the Commissioner of Official Languages proposes a number of changes to the Official Languages Act. Would the Prime Minister indicate whether he is contemplating changes in the act? In addition, would he tell the House when we can expect to see them introduced? It is too bad that the Prime Minister has not read the report, but would he consider sending it to a select committee of the House of Commons, since it is obvious that this government needs some help from somewhere, and perhaps there is some talent in this House that can help this government?


Pierre Elliott Trudeau: Mr. Speaker, I regret once again that I did not read the report which was tabled yesterday. If it is obvious that the government needs some help in selling its language policy to the country, I hope we will have help from the opposition for a change.


Walter David Baker: A final supplementary question, Mr. Speaker. I point out to the Prime Minister by way of preamble that help is available in this country if the Prime Minister would only ask, and help is available in this parliament. If the Prime Minister insists on going his own way, the country will suffer for it. Would the Prime Minister consider recommending the establishment of a select committee of this House, or a joint committee of the House and the Senate if that is the case, to deal with this official languages program and the problems which have been presented to parliament by the commissioner in report after report, so that this program and its implementation procedures can be brought into line with the aspirations of most Canadians?


Pierre Elliott Trudeau: Mr. Speaker, the hon. member seems to forget that we initiated this program, that we are the authors of it.


Mr. Hnatyshyn:: And it is a failure.


Pierre Elliott Trudeau: We take some responsibility, of course, if there have been errors and mistakes in application, but surely we do not need enjoinders from the hon. member telling us it has to be sold to the country and be better understood. The hon. member suggests that we should set up a parliamentary committee. That is fine. If he wants to have a resolution before the House to go back and renew our pledge to the Official Languages Act-


Some hon. Members:: Oh, oh!


Steve Eugene Paproski: Don't give us that again.


Pierre Elliott Trudeau: Well, Mr. Speaker, how do I set up a committee except by moving a motion and referring to it terms of reference? If the opposition want to co-operate with us, I am
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sure we can all spend a day saying the same thing, that we should sell the official languages policy to the country and apply it as best we can.


CONFEDERATION
Mr. Douglas Roche (Edmonton-Strathcona):: Mr. Speaker, my supplementary question is directed to the government House leader. Because national unity comprises economic and social questions across the country as well as linguistic and cultural questions, I want to return to the answer given me yesterday by the House leader, who said that he hoped that he would be able to put before the House proposals concerning the national unity question following the Easter break. Since members will be in their constituencies for the Easter break getting the views of their constituents, can the House leader indicate now whether he is thinking of a resolution and the scope of such a resolution, or some other legislative action, or even a special committee, so that members will know how to plan for and participate in what the House leader himself has termed this crucial question?


Hon. Allan J. MacEachen (President of the Privy Council):: Mr. Speaker, when I referred yesterday to proposals, I had in mind proposals that might make it possible for the House of Commons to spend a greater time on current issues, including the question of national unity. I hope to be able to make some proposals that will clear the way for more relevant debate in the House.


An hon. Member:: Backtracking again.


Douglas Roche: Mr. Speaker, my supplementary is directed to the government House leader. Returning to the question of the Prime Minister suggesting help from the members of the House, may I ask the government House leader if, in proposing the action he will bring into the House, he will fully consult with representatives of all the parties who are willing to help the government form a national debate on the question of national unity?


Allan Joseph MacEachen: Mr. Speaker, I have held the view that has been expressed by others that the House ought to be given an opportunity to deal, by way of debate and possibly through other instruments of the House, with the question of national unity and to engage itself with this immediate question. I have to take into account the over-all volume of business before the House and the competing demands of other questions. In order to deal adequately with the question of national unity, we will have to give some considerably greater attention to the management of our own affairs in the House.


Steve Eugene Paproski: You have got no other business. It is all monkey business.

March 31, 1977
Oral Questions TRANSPORT


PROPOSED SUBSIDY TO FAMILIES TRAVELLING TO QUEBEC FOR LANGUAGE TRAINING-GOVERNMENT POSITION
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I have a question for the Minister of Transport. Given the government's commitment in the Throne Speech last fall to improve language training facilities and opportunities for all Canadians, and given that the Official Languages Commissioner in his most recent report has described the government's efforts toward youth language training in particular as being "inexcusably fragmentary", I would like to ask the Minister of Transport a specific question. Will he, in terms of his responsibilities, take steps to encourage travel both to and from the province of Quebec for families by offering direct subsidies for rail travel to Canadian families making such trips?


Hon. Otto E. Lang (Minister of Transport):: Mr. Speaker, we all recognize the value of that and, on the other hand, the problem of the finances involved in it. The first and very important step along those lines was taken only about a week ago in the announcement by the Secretary of State of the program of interchange of young people.


John Edward Broadbent: Mr. Speaker, the minister knows that the program to which he has just referred does not go nearly as far in this direction as would a very significant subsidy to all families who are involving themselves in that course of action to travel by rail.


BILINGUALISM
John Edward Broadbent: Mr. Speaker, 1 would like to direct my second question either to the Prime Minister or to the Secretary of State and ask will the government consider providing, either through a tax concession of some sort or some other method, a financial incentive to Canadians who have to take second language training for occupational purposes, that is, Canadians who will be working outside the public sector and need a second language?


Hon. John Roberts (Secretary of State):: Mr. Speaker, at least the preamble to the question was directed toward me. If the hon. member will refer to the remarks I made in the House last Thursday, March 24, and particularly the responses I made to questions from the hon. member for York-Scarbor-ough, he will see that indeed the program announced last Thursday is a very extensive one which will involve, at the departure point, the exchange of 30,000 young people. The question of including families in that exchange arrangement was something, as I indicated to the hon. member for York-Scarborough, that we would certainly consider as the program developed over the years to come. It is a program which is very extensive in its impact. I think if he checks back and looks at

the details that I announced at that time that he will agree with me.


REQUEST FOR IMPROVED TRANSLATION SERVICES FOR MEMBERS
John Edward Broadbent: Mr. Speaker, my final supplementary will go to the Prime Minister. As a preface to it, I would like to point out to the minister who just answered that the program he referred to does not pertain to travel to and from the province of Quebec which is certainly essential in terms of the problems with which we are dealing. The question I have for the Prime Minister is that given the lack of facilities for members of parliament in terms of translation services, whereby it takes anywhere from three to five days for a member to get a letter translated from English to French or French to English, will the Prime Minister take steps to ensure that the facilities for members of parliament are significantly improved so that we can get translation of correspondence more rapidly than is possible today?


Mr. Speaker:: Order, please. Regrettably, that jurisdiction is mine, not the Prime Minister's.

[ Translation]


THE CONSTITUTION
Léonel Beaudoin: Mr. Speaker, I wish to direct a question to the right hon. Prime Minister.
Could the right hon. gentleman advise the House whether he feels Canada should go ahead and set up a committee of all the provinces and the Canadian government to examine the possibility of ridding the current constitutional debate of partisan politics and submit recommendations?


Pierre Elliott Trudeau: Mr. Speaker, on previous occasions the hon. member already suggested holding federal-provincial conferences to discuss this. He mentioned the federal and provincial governments: a number of constitutional conferences have already taken place and I should like to remind him that as recently as two and a half months ago I wrote to all provincial premiers to propose to them what the hon. member has just suggested, namely holding a conference or at least exchanging correspondence on the constitutional issues. So far only two of the ten provinces have replied to me.


Léonel Beaudoin: Mr. Speaker, on a supplementary.
As the Prime Minister has just said, and I thank him for it, there does not seem to have been much action taken with regard to the idea he expressed on television while I was away
March 31, 1977

from the House because of illness; however, can he tell us whether he can suggest practical and concrete solutions to that politicization so that the man in the street can know what is true and what is false and also have the means to find out where we are going with all the contradictory statements we hear at the present time about the viability of the constitution?


Pierre Elliott Trudeau: Mr. Speaker, with regard to the proposals the federal government has made to the provinces for nine years now, a whole series was put forward at federal-provincial conferences between 1968 and 1971. In addition, another series was put to them in letters I wrote to the provincial premiers in the spring of 1975: those letters were tabled in the House. The last stage in the discussion, I say it again, took place in January when I wrote to the premiers suggesting a number of constitutional changes. That letter was also tabled in the House. May I repeat that to date only two provincial premiers have been able to reply to the federal proposals.


BILINGUALISM
Mr. Joe Clark (Leader of the Opposition):: Mr. Speaker, I have a question for the Prime Minister supplementary to that asked by the House leader of the Official Opposition. I have to say that I think the Prime Minister's approach was dangerously near the irresponsible in his answer.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: I should like to ask the Prime Minister or repeat the question to him-will he give the House an undertaking now that he will refer the latest annual report of the Commissioner of Official Languages to a committee of this House in order that such committee may work to improve the administration of the official languages program with particular references to the problems pointed out in the report of the commissioner?


Pierre Elliott Trudeau: Mr. Speaker, I regret that the hon. member found there was some measure of irresponsibility in my answers. It seems to me I attempted to answer some questions which were not precisely lacking in hostility to the government from the House leader.


Some hon. Members:: Hear, hear!


Walter David Baker: The government deserves the hostility.


Pierre Elliott Trudeau: The House leader says the government deserves the hostility. I admit we have not been perfect in the application of the official languages program-


Some hon. Members:: Oh, oh!
Oral Questions


Pierre Elliott Trudeau: -but it seems to me that it is no more irresponsible to answer in the same tone than it is to ask the question. In so far as the proposal of the Leader of the Opposition is concerned, I would have to read the report. He suggests proposed reforms which, if I understood him correctly, apply specially to the provinces.


Charles Joseph Clark: No.


Pierre Elliott Trudeau: Perhaps I will have to read Hansard to see if he did not say it.


Charles Joseph Clark: I wish the Prime Minister would begin by reading the report-


Some hon. Members:: Oh, oh!


Charles Joseph Clark: -then he might come to the question.


Some hon. Members:: Oh, oh!


Steve Eugene Paproski: In French.


Charles Joseph Clark: I think it is important that the House know that any hostility, any criticism of the government that arose from this side was criticism based upon observations made by the Commissioner of Official Languages. I would like the Prime Minister to indicate now-


Some hon. Members:: Oh, oh!


Charles Joseph Clark: -whether the right hon. gentleman can assure the House that perhaps after he has had the opportunity to read Mr. Spicer's report he will be prepared, before Easter, to give specific indications on the possibility of referring this report to a committee of the House of Commons?


Pierre Elliott Trudeau: Mr. Speaker, as I have indicated to the House leader, this idea is not necessarily a bad one. We are very happy to see that hon. members of the Official Opposition would like to discuss this matter again. In the past, we have let this matter stand on the order paper; we were told that this was a divisive matter and that it should not be raised, and so on. Therefore I am delighted that the opposition wants it to be the subject of a discussion. First let me read the report; then I shall be able to answer the question.


GOVERNMENT ADMINISTRATION
Mr. Don Mazankowski (Vegreville):: Mr. Speaker, my question is directed to the President of the Treasury Board. It arises from an answer that was given to me, as reported at page 4378 of Hansard, in which the President of the Treasury Board indicated that the government is giving due and serious consideration to the Auditor General's recommendation to

March 31, 1977
Oral Questions
raise the status of the deputy secretary in charge of the financial administration branch. May I ask the minister whether we can assume from that statement that the government has now decided to accept the Auditor General's recommendation to establish the office of the comptroller general, and given the fact that this would require a fundamental restructuring of the Treasury Board secretariat, can we assume that that is being considered. Can we assume as well that this would take place before the Lambert Commission brings in its first report to the House of Commons?


Hon. Robert K. Andras (President of the Treasury Board):: Mr. Speaker, the considerations and consultations are still continuing.


TERMS OF REFERENCE OF LAMBERT COMMISSION
Donald Frank Mazankowski: In view of the fact that the government is now actively considering the recommendations of the Auditor General and that the terms of reference of the Lambert Commission cover some of the important points which were made in the Auditor General's report, may I ask the minister if in fact the commission will be reviewing the control mechanism of the government that is in existence at this time, or will it be reviewing a form of restructured arrangement as a result of the negotiations that are presently going on?


Robert Knight Andras: The terms of reference of the royal commission are available to all hon. members to review, and I think they would indicate to the hon. member that its mandate could be inclusive of examining such restructuring. It has a much broader mandate than that relating to financial management and control of departments of government, agencies of government and Crown corporations, and also the very serious and complex matter of accountability related to such moves or changes.


Donald Frank Mazankowski: Can the minister tell the House when we may expect an announcement with respect to the appointment of a comptroller general?


Robert Knight Andras: No, Mr. Speaker.


EXTERNAL AFFAIRS
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, my question is directed to the Secretary of State for External Affairs. As members of the House of Commons have no knowledge whatever of what the government is doing in connection with matters of international importance-everything is kept in the cold storage of government secrecy because parliament does not have the opportunity, which it used to have under previous prime ministers, of a couple of days

discussion from time to time on a motion of the government in respect of international affairs-and is therefore having to depend on the media-I ask the minister what was the nature of the stand taken by Canada in the Security Council within the last couple of days in connection with South Africa?


Hon. Donald C. Jamieson (Secretary of State for External Affairs):: Mr. Speaker, on the preamble of the question, I should remind hon. members-in case the right hon. member did not know this-that the House leader mentioned yesterday his intention and his plans to provide just such a forum after Easter.


Ramon John Hnatyshyn: On national unity, not international unity.


Donald Campbell Jamieson: If the hon. member would like to have the answer, I happen to have it in front of me and was looking at it as he rose to speak. It should please him, I think. In plain language, Canada made a devastating attack Wednesday on South Africa's racial policy of apartheid that won praise from the African National Congress as well as western and African countries.


Some hon. Members:: Hear, hear!


John George Diefenbaker: Yes, I can read the papers, too. But we get none of that information in parliament. Indeed, the minister was so unaware of what was done that he had to read the statement in order to answer the question.


Some hon. Members:: Oh, oh!


John George Diefenbaker: I must ask the minister whether the government would give consideration to a request that I made some weeks ago that an opportunity be provided in Parliament for discussion of this whole question of international affairs. I also ask him, in view of this terrific attack-what was the word?


Some hon. Members:: Devastating attack.


John George Diefenbaker: -in view of the devastating attack, is it not time there was a devastating attack made by Canada on Amin and his administration and on Cuba mobilizing Communists against nations in Africa?


Some hon. Members:: Hear, hear!


Donald Campbell Jamieson: Mr. Speaker, I deeply regret that the questions came before the appropriate time on the order of business for me to do what I intended to do so that the hon. member might realize that I did not just read it from the papers. I have here a text of the speech in French and in English which I intended to table at the appropriate time.


Some hon. Members:: Go ahead.


Donald Campbell Jamieson: May I do it now?


John George Diefenbaker: Why do we not have the opportunity to discuss this matter?


Some hon. Members:: Hear, hear!
March 31, 1977


Donald Campbell Jamieson: I realize, of course, that in view of the right hon. member's exalted and very special position he does not have to come to committee meetings, but I have spent six hours before the committee on exactly these subjects in the last three weeks.


Some hon. Members:: Hear, hear!


Donald Campbell Jamieson: My specific answer to the right hon. member's question is as follows: I think he must know that on both the issues he has raised-I will be glad to deliver the chronology to him personally-we have done everything that is possible for us to do, first, with regard to the Ugandan situation. I am not sure what the hon. member's reaction will be except that I tell him that the wording I used is the strongest that I know, and if there is any one better than 1 in the House, then I expect it is he. Why does he not write it himself and I will be glad to say it his way?


Some hon. Members:: Hear, hear!


John George Diefenbaker: Why is there no resolution condemnatory of this conduct? Apparently the minister has talked, but he has been as effective as wind in the air. Why does Canada not take a strong stand in the Security Council rather than using the muted tones of the hon. gentleman?


Donald Campbell Jamieson: Mr. Speaker, it is clear that 1 am more effective than wind in the air because if I could not stand up to the wind coming from the side opposite, I would be back in the back row.


Some hon. Members:: Hear, hear!


An hon. Member:: That is not possible.


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. We seem to have drifted somewhat from the question period. Perhaps we ought to go on to another question. The hon. member for Parkdale.


GATT NEGOTIATIONS-REQUEST THAT CANADA NOT TAKE POSITION ENDANGERING EMPLOYMENT
Hon. Stanley Haidasz (Parkdale):: Mr. Speaker, I wou]d like to ask the Minister of Industry, Trade and Commerce whether he could assure this House that the Canadian negotiating team at GATT will not take any position which would endanger the jobs of Canadians, especially in the automotive parts industry.


Hon. Jean Chretien (Minister of Industry, Trade and Commerce):: Mr. Speaker, I am pleased to assure the hon. member that we are following the negotiations very closely and that, as
Oral Questions
far as the auto agreement is concerned, the relations between Canada and the United States are rather bilateral compared to other countries. In any event the hon. member knows very well that we are aware of the employment situation in the automotive industry and that we intend to improve it.


NATIONAL DEFENCE
Mr. Paul Dick (Lanark-Renfrew-Carleton):: Mr. Speaker, I would like to put a question to the Minister of National Defence. I do not think there will be any supplementary questions. In view of the fact that the government was planning what might be called a youth corps and subsequently announced its intention in the throne speech six months ago, thus leaving the government plenty of time to prepare an announcement and time to finalize the program, and knowing that youth unemployment and under-employment is at its highest level in history, making up 50 per cent of today's unemployment problem, can the minister tell us whether he will finally announce this multimillion dollar youth corps program in the House today by way of a statement on motions, or will he follow the example of some of his cabinet colleagues by arrogantly bypassing parliament and making an announcement by means of a statement or press release outside the House of Commons? If so, when will the announcement be made, and if not in the House, why not?


Hon. Barney Danson (Minister of National Defence):: Mr. Speaker, as I indicated to the hon. member in the last couple of weeks I would be making announcements by the end of the month. In order to do that and to have everything ready I will be issuing a release, regrettably, later this afternoon because I want to keep my commitment to the hon. gentleman, and because of my absence from the country, I have not had an opportunity to prepare a statement on motions, but I would be happy to answer any questions the hon. gentleman might have.


Paul Wyatt Dick: Privilege at three o'clock.


EXTERNAL AFFAIRS
Ramon John Hnatyshyn: Mr. Speaker, my question is directed to the Secretary of State for External Affairs. A few days ago a question was raised with respect to the use by the minister's parliamentary secretary of letterheads for the purpose of solicitation of funds for political purposes. The minister undertook to look into this matter and to report to the House. I wonder if he is now in a position to do so.

March 31, 1977
Oral Questions


Donald Campbell Jamieson: Mr. Speaker, as far as my own department and parliamentary secretary are concerned, I of course can answer in that regard, and the answer is that I do not feel that that was an appropriate use of the stationery of the department. I am sure that it was done inadvertently, but nevertheless so far as my own department is concerned I will certainly ensure that that action is not taken again. So far as general policy is concerned, that is, of course, not my responsibility.


CANADIAN MINT
Mr. Bill Clarke (Vancouver Quadra):: Mr. Speaker, my question is for the Minister of Supply and Services. It relates to a recent announcement by the Department of Supply and Services that the Royal Canadian Mint has been awarded contracts to supply 650 million coins to Israel, Panama and several other countries. Why has the government found it desirable to be in the business of producing coins for sale in competition with private sector minting companies, and have adequate safeguards been taken to ensure that Canadian taxpayers will not be subsidizing coinage in other countries?


Hon. Jean-Pierre Goyer (Minister of Supply and Services):: Mr. Speaker, there is no reason why the Royal Mint would not make maximum profits out of its operations, and in doing so it does not compete with the private sector. In fact it competes on the international market with minting plants operating in England, in France, in the Federal Republic of Germany and even in Japan. Its operations are quire successful on the international market and I am proud of it.


POSSIBLE USE OF AGENT IN OBTAINING ORDERS FROM FOREIGN COUNTRIES
William Hillary (Bill) Clarke: Mr. Speaker, did the government use the services of Shaul Eisenberg or any other commercial agent in obtaining these contracts?


Jean-Pierre Goyer: Mr. Speaker, the question does not sound very serious.


EXTERNAL AFFAIRS
Mr. Stuart Leggatt (New Westminster):: Mr. Speaker, I had intended to direct my question to the Secretary of State for External Affairs, but he seems to have left the building.


Ramon John Hnatyshyn: I blew him out with my last question.


Stuart Malcolm Leggatt: Perhaps I could direct my question- to the Prime Minister. It relates to the unilateral decision by Kenya to cancel a contract with Hawker Siddeley of Cape Breton to build some 900 freight cars for $60 million. There now seems to be ample evidence that this unilateral cancellation was a subterfuge to replace the contract of the low bidder with that of another contractor. In view of the fact that Canada will spend some $88 million in aid to Kenya over the next few years, is the government now reconsidering its aid program with regard to Kenya in view of this very high-handed action on the part of the Government of Kenya of depriving Canadian workers in Cape Breton of suitable employment?


Pierre Elliott Trudeau: Mr. Speaker, I would have to take note of the question. I was not aware of the situation. I will refer it to the appropriate minister.


Stuart Malcolm Leggatt: Mr. Speaker, my supplementary question is to the government House leader because of his responsibility with respect to CIDA. My question relates to the matter of the cancellation of the Hawker Siddeley contract in Cape Breton by the Government of Kenya for the supply of $60 million worth of freight cars. Can the government House leader advise whether the aid program with regard to Kenya over the next few years in the amount of some $88 million will now be reconsidered in view of the very high-handed action taken by that government, and would the minister also advise if he would be willing to table the protests, if any, of the Canadian government in the House so that we can examine what action this government has taken in response to that action of the government of Kenya?
[ Translation]


Joseph Jacques Jean Chrétien: Mr. Speaker, I am aware of the case. We have filed protests with the government of Kenya on that matter and I do not believe this news should be linked to our assistance program.


TRANSPORT
Hon. Robert L. Stanfield (Halifax):: Mr. Speaker, I have a question for the Minister of Transport relating to the various cargo services between the mainland and Newfoundland. As the minister knows, there is a service from Cape Breton to Newfoundland as part of the railway, two subsidized services from Montreal to Newfoundland and an unsubsidized service from Halifax to Newfoundland. What is the policy of the minister's department with regard to these services? Is it intended to favour services between Newfoundland and certain points on the mainland, or is the intention to treat the various points on the mainland with an even and equal hand?
March 31, 1977


Otto Emil Lang: Mr. Speaker, it is our policy to attempt to treat different points of departure with an equal hand. The general policy is to examine those services which are able to offer services at a lower cost than other existing services, and where subsidized rates leave them uncompetitive, to attempt to offset that difference.


CANADIAN NATIONAL RAILWAYS
Mr. Lloyd R. Crouse (South Shore):: Mr. Speaker, my question is a supplementary question, and it is related to the problems we have in Nova Scotia. For example, the CNR has announced that it is closing down early in June its car loading facilities at Bridgewater, Nova Scotia and moving them to Halifax. In view of the inconvenience and further loss of jobs this action will cause to our railroad workers and to our newspaper exporters at Liverpool, to our Christmas tree exporters at Bridgewater, to our Fish and fishmeal exporters at Lunenberg and to our Michelin Tire exporters at Bridgewater-
Some hou. Members: Order.


Lloyd Roseville Crouse: -will the minister take steps immediately to investigate this move in the hope that steps will be taken to alter what will be very detrimental to Canada's export business in this area?


Otto Emil Lang: Mr. Speaker, I will bring that representation to the attention of the Canadian National, if the hon. member has not already done so, and attempt to obtain the information for the hon. member.


MANPOWER
Mr. Robert Muir (Cape Breton-The Sydneys):: Mr. Speaker, my question is for the Minister of Manpower and Immigration. The deputy minister of education in the province of Nova Scotia has stated that funding has been cut for the adult vocational training program; labour minister Fitzgerald of the province states that the funding has remained the same; and the federal minister's regional information officer states that funding for the training program has increased. In view of these statements, would the minister clarify the situation? What has the department done?


Hon. Bud Cullen (Minister of Manpower and Immigration):: Mr. Speaker, the funding has been increased but, because of
Oral Questions
additional costs, the increased funding did not cover increases in training. Actually, there may be a cutback. The funds made available were increased, but the amount for training has been decreased owing to increased costs.


Robert Muir: A supplementary question, Mr. Speaker. I thank the minister for his reply. Did the minister of education of Nova Scotia make strong representations for further funding to the minister, in the recent meeting they held? Has there been correspondence on that subject? If so, in view of the serious unemployment and economic position of the province, can the minister advise the House if more money will be made available to Nova Scotia, to continue present training and, indeed, expand it? I ask this particularly since Carman Moir, deputy minister of education, stated again on Monday of this week that 45 instructors will lose their jobs as a result of reduced funding by the federal government. Who is right?


Jack Sydney George (Bud) Cullen: Mr. Speaker, this is one of those unhappy and happy circumstances in which I guess both are right. As I said, the funding had been increased, but so had costs. Therefore, the amount of training available had to be reduced. But we made available an additional $340,000 in training funds. I met with the minister when I was in Halifax, attending the recent convention. He made strong representations, and I indicated to him at that time that if I could get my UI bill through the House, some additional funding under it might be available for training. We were looking at all sources, in the interest of helping that region particularly.


ADMINISTRATION OF JUSTICE
Mr. F. A. Philbrook (Halton):: Mr. Speaker, my question for the Minister of Justice is on the subject of marijuana legislation. On March 18, one of those local newspapers which are the backbone of our nation, the Oakville Journal Record, conducted a survey of local lawyers, all of whom favoured changes to the existing law, to eliminate the log-jam effect on our court system.


Ramon John Hnatyshyn: They were "potheads."


Frank A. Philbrook: They supported the placing of marijuana under the Food and Drugs Act, instead of the Narcotic Control Act. Is the minister aware of any such official position on the part of the Canadian legal profession, put forward perhaps through the Canadian Bar Association.


Hon. Ron Basford (Minister of Justice):: Mr. Speaker, the Oakville Journal Record is not on my regular reading list.


Some hon. Members:: Hear, hear!


Stanley Ronald Basford: I appreciate the hon. member bringing this matter to my attention. Answering his question, let me say I
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March 31, 1977
Oral Questions
am aware that one group of lawyers have formed an association urging the legalization of marijuana. They are not speaking, however, for the Canadian Bar Association. I am not aware that the Canadian Bar Association has expressed an opinion on the matter. Certainly, it may have done so in the past, but I am not aware of any such recent expressions of opinion. When I received their formal annual presentation of resolutions last year, this subject was not included among them.


PUBLIC WORKS
Mr. G. H. Whittaker (Okanagan Boundary):: Mr. Speaker, my question is for the Minister of Public Works. In view of the past record of the Department of Public Works in disposing of abandoned post office sites in my riding, against the wishes of most of the people, I ask the minister when he is going to answer my letter of February 7 concerning the disposition of the abandoned post office site in the city of Grand Forks?


Hon. Judd Buchanan (Minister of Public Works):: Mr. Speaker, I will check the hon. member's correspondence and reply to him.


FISHERIES
Mr. Janies A. McGrath (St. John's East):: Mr. Speaker, in the absence of the Secretary of State for External Affairs may I direct my question to the Minister of Fisheries and the Environment? In view of the resolution which the United States Senate passed today, a resolution based on false and misleading information and which, in my view, represents a deliberate and unfortunate intrusion into Canada's domestic affairs, what steps does the minister intend to take, either on his own behalf, through his own department, or through the Department of External Affairs, to correct the false and misleading information which has been spread in the United States as a result of the resolution both houses of Congress passed?


Hon. Rom6o LeBlanc (Minister of Fisheries and the Environment):: Mr. Speaker, I know that the Department of External Affairs has been in touch with those in the United States who have expressed views on this issue. I will also communicate full information to the representatives who raised this issue in the House of Representatives, and also to the senators involved. I hope that the preface to this resolution will be better informed than the one which was adopted in the House of Representatives.
[Mr. Basford.J


SEAL HUNT-POSSIBILITY OF MAKING REPRESENTATIONS TO UNITED STATES CONGRESSMEN AND SENATORS
Jack Marshall: Mr. Speaker, a supplementary question. The Secretary of State for External Affairs indicated he would make representations to the Senate. I wonder if the minister can confirm that. Did the minister obtain an answer? Would he also consider the suggestion of some of his colleagues, that Newfoundland members might make a trip, to teach the unknowledgeable souls who sit in the Senate and the House of Representatives of what is going on in the seal hunt?


Mr. Alexander:: 
Some hon. Members:: Hear, hear!


NATIONAL DEFENCE
Mr. David MacDonald (Egmont):: Mr. Speaker, my question is for the Minister of National Defence. It is with respect to the disturbing news of a few moments ago that a tragic crash and collision of an Argus aircraft has occurred at CFB Summerside today. Can the minister give a brief report on the fate of the crew, and whether at this time there are any indications relating to the cause of this crash?


Barnett Jerome Danson: Mr. Speaker, I thank the hon. gentleman for asking the question. I am able to report that 15 of the 16 crew members survived the crash. At least seven are seriously injured and the rest injured. There was one known fatality. At this time there is no indication of the cause of the crash. The aircraft was on a patrol mission, actually a rescue mission, and was forced to return to base at Summerside. It lost one engine, and, on the approach, veered off the runway, or was close to the runway, and crashed into another aircraft which was parked beside the runway. There were no passengers in the other aircraft. That was the latest report I had just before the beginning of the question period.


CONNAUGHT LABORATORIES-POSSIBILITY OF LEASING BIOLOGICAL PRODUCTS DIVISION-GOVERNMENT POSITION
Mr. P. B. Rynard (Simcoe North):: Mr. Speaker, my question is for the Minister of National Health and Welfare. Have negotiations been undertaken with the province of Ontario and
March 31, 1977

the University of Toronto, to lease all the division of Connaught Laboratories which manufactures biological products and which has been a headache from the point of view of production and finance?


Hon. Marc Lalonde (Minister of National Health and Welfare):: Mr. Speaker, as the hon. member knows, Connaught Laboratories are owned by the Connaught Development Corporation which reports to the Minister of Finance. I must draw this matter to the attention of the Minister of Finance and ask if he has received information to that effect. Personally, I have not received such information.


PRIVILEGE
John George Diefenbaker: Mr. Speaker, I rise on a question of privilege which arises from a question asked a few moments ago by the hon. member for Saskatoon-Biggar (Mr. Hnatyshyn) in connection with matters which came before the House on March 17 as reported at page 4067 of Hansard. 1 do not want to read in extenso, but 1
shall read a portion of the proceedings of that day in order that my question of privilege may be understood. The hon. member for Laurier (Mr. Leblanc) had presented a document, in fact, a letter under the letterhead of the parliamentary secretary which translated reads as follows, as reported in Hansard:
As you know the federal government favours a participation more direct of the citizens and the men of affairs-that is businessmen-in the financing of the Liberal party.
The hon. member goes on to discuss contributions and how they can be deductible. Then he says:
Be assured that your contribution will be greatly appreciated.
Liberally yours,
Fernand E. Leblanc.
This matter was raised by the hon. member for Brome-Mis-sisquoi (Mr. Grafftey). As reported at page 4068 of Hansard the parliamentary secretary raised a question of privilege. He said that the minister knew nothing about it. There is no question about that. The minister did not. He made that clear today. He then said, and I quote:
I must free the Secretary of State for External Affairs (Mr. Jamieson) of all responsibility in that matter, for he was not even aware of my subscription campaign in the constituency and I did not see fit to discuss it with him because it is with the leader of Quebec, the Minister of National Health and Welfare (Mr. Lalonde), that I discuss those things.


Lincoln MacCauley Alexander: Go ahead and get him, chief.


Some hon. Members:: Hear, hear!


John George Diefenbaker: The minister is apparently the key Pooh-Bah for the Liberal party in Quebec. The next sentence reads:
Privilege-Mr. Diefenbaker
Moreover, Mr. Speaker, nothing in what I did violates the election legislation passed by this House nor runs counter to the normal use of our stationery.
I challenge that statement. Then he said:
If I am not mistaken, yourself, Mr. Speaker, three weeks or a month ago, when the question was put to you and we discussed it, said that someone had asked you if that practice was acceptable, and if I remember well you told me that a minister may use his stationery in those circumstances, just like his parliamentary secretary, and anybody else may use the House of Commons stationery, if being a member is their only title.
I am not going to ask Your Honour if you said that. I do not believe you ever did. That statement would indicate the approval of Your Honour of a practice that is totally reprehensible and inexcusable.


Some hon. Members:: Hear, hear!


John George Diefenbaker: It should be cleared up once and for all that this kind of thing cannot go on. No minister, parliamentary secretary or other member can use the stationery of the House of Commons, of a minister or parliamentary secretary and say, "Be assured that your contribution will be greatly appreciated. Liberally yours". If this practice were permitted there would be no limit to the number of letters that might go out from those so minded. It would be dangerous to democracy, and in contempt of parliament.


Some hon. Members:: Hear, hear!


Ramon John Hnatyshyn: Mr. Speaker, in the course of the question period today I raised a question in order to obtain from the minister a response and a report as to his investigation into the wrongful use by his parliamentary secretary of departmental letterheads for the purpose of soliciting funds for the Liberal party. I wish to address myself to the response given to me by the minister in the question period.
I do not think the minister went far enough. This matter affects the rights and privileges of every member of this House. As the right hon. member for Prince Albert (Mr. Diefenbaker) said, it is a matter of very serious consequence. Your Honour can imagine an ordinary citizen receiving a letter from the office of the Secretary of State for External Affairs soliciting funds for the government party. Imagine the effect it might have on the ordinary citizen. The practice is not only wrong but it is reprehensible.


Walter David Baker: How about National Revenue stationery?


Ramon John Hnatyshyn: I know not of National Revenue stationery, as suggested by the hon. member, but I know that in this particular case it was External Affairs. However, one can imagine the consequences if a National Revenue parliamentary secretary utilized that letterhead for the purpose of soliciting funds. What effect would that have on the average citizen of this country? The point that should have been reported on by the minister at this juncture was not only a pure and simple statement by him that it was wrong, but what remedial action he intended. It is not enough simply to say he
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March 31, 1977
Privilege-Mr. Diefenbaker
did not think it was appropriate; there should be something further.
Is there to be a letter going out to the people who received this correspondence stating that is was a wrongful act? The minister should write to each and every person who received that letter, pointing out that the letter was not sent under the jurisdiction of the department or under the aegis of the government, but was wrongfully sent out by the hon. member in question. That should be the minimum sanction by the minister in this case.
I know Your Honour will want to consider the unfortunate reference made by the hon. member and referred to by the right hon. member. However, the minister has something to answer for if he does not indicate that he is prepared to remedy the situation far more appropriately than he has.


Mr. Erik Nielsen (Yukon):: I will be very brief, Mr. Speaker. The conduct of the parliamentary secretary concerned is something that has not yet been touched on. A parliamentary secretary is not an ordinary member of parliament: he is in a position of high responsibility, being the No. 1 assistant to the minister. I am sorry the parliamentary secretary is not here to hear this, or the minister. The conduct of the parliamentary secretary is in question. Had it been a minister who had conducted himself in that fashion, he would either have resigned or his job would have been taken from him. I suggest a similar sanction is a compelling requirement as a result of the dreadful wrongdoing of the parliamentary secretary in this instance. If he did not know it was wrong, he should have known it was wrong.


Mr. Speaker:: The question of privilege raised is a very important one. There was no warning that the matter would be raised today. I think it appropriate that an opportunity be given hon. members to participate in the discussion. There is no urgency in respect of resolving this question on a moment to moment basis, and I would like some time to reflect on the problem.
Initially there are two difficulties which the Chair faces in this situation. First, it is the right of every member of the House of Commons to have the privacy of his own stationery. It is not the function of the Chair, or the administration of the House, to open the mail of a member to determine whether the frank or stationery is being used in a manner that is appropriate or in keeping with any kind of standard guidelines.
This differs, of course, from publications or communications that go out by members at public expense. I refer to the obvious difference with respect to householder mailing where there is regulation because it is being paid for by parliament. However, with regard to a private letter sent out by a member the Chair has no more authority to open that mail, any more than a private individual, whether a member or not.
The difficulty is with respect to the special designations of ministers, parliamentary secretaries or other special offices. That is not a function of the Chair. It is a function of special status which really does not come under the purview directly

of the presiding officer of the House. Therefore, there is an additional difficulty.
In both of these cases it has been accepted that the censure that takes place is precisely the one that is being proposed here. It is not the censure of the Chair, but the censure of the House. Indeed, that is what has been raised. Questions have been raised and questions have been put to the minister. The minister has responded to questions and indicated today that he did not approve of the action. With regard to some pressure for further sanction, I will take some time to reflect on it, but the sanction will be the sanction of the House and not the sanction of the Chair.
In a preliminary way, I do not see the Chair having the authority of interfering with the private mail of any member. Again, I am open to further discussion and to reflect upon it. I think, therefore, the matter ought for a few days to stand over for consideration.


MR. DICK-ANSWERS BY MINISTERS OUTSIDE HOUSE
Paul Wyatt Dick: Mr. Speaker, I rise on a question of privilege having to do with the answer I received from the Minister of National Defence (Mr. Danson) indicating his intention to make an announcement of a certain program, not inside the House of Commons but outside by means of a press release.
This practice has been objected to on a number of occasions. In the case to which I am addressing myself, for over six months the department has been working to create a youth corps. Such a program was announced in the Speech from the Throne only 12 days short of six months ago. On February 3 a question was put to the Minister of National Defence on the subject, and he replied, "When I am in a position to make an announcement, I will make an announcement." On February 11 a further question on the subject of the youth corps was put to him, and again on February 24, as reported in Hansard under the heading, "Proposed youth corps-Request for details". The minister replied, "I hope to be able to say something within the next couple of weeks." On March 8, in reply to a further question, he stated in part, "I hope to be able to make an announcement along those lines in the near future", and on March 17 he stated, "I hope to make an announcement and answer all the questions by the end of the month."
Mr. Speaker, this is the last day of the month. We were told by the minister on all those occasions that he would be making an announcement. An announcement, in the normal context, is usually an oral communication. I believe the statement which is contemplated is one outlining government plans for expenditures. My information is that an expenditure on the part of the government amounting to between $5 million and $7 million in the initial stages is related to this particular program.
It is my submission that a statement with regard to it ought first be made before parliament because, under the rules, we have the right to question statements on motions, something
March 31, 1977

which is not possible if they are made outside the House to members of the press. I say we are being denied our privileges, we are being denied the right to hear an announcement of this program in the chamber so that we may question the minister with regard to it, and he and his colleagues are denigrating parliament by treating us in this manner. I therefore move, seconded by the hon. member for Wellington-Grey-Dufferin-Waterloo (Mr. Beatty):
That the subject matter of cabinet ministers making statements concerning policy or expenditure outside of the House of Commons, thus avoiding the scrutiny and questions of duly elected members, be referred to the Standing Committee on Privileges and Elections.


Barnett Jerome Danson: Mr. Speaker, I have listened to the hon. member's remarks with great interest. As I indicated in the answer I gave during the question period, I actually hurried this announcement because of my commitment to make an announcement before the end of this month. I welcomed his questions on the program.
It was not possible, between now and the time I got final authority, and certainly having regard to the time I have been away, to provide a statement on motions. In any case, there is no obligation to do so. That matter was canvassed in the course of a discussion reported in Hansard on November 23, 1976, and I draw attention to Your Honour's remarks on that occasion and to other statements on the same subject matter both before and subsequent to that date. There is certainly no disposition on my part to avoid scrutiny of this program or, indeed, of any other of my programs. I want to point out, however, that in this case the hon. member will have the release on his desk this afternoon, when he will see that this is not a program of the Department of National Defence; it is a program to which the federal government is contributing but it is operated by a private corporation outside the public service and the bureaucracy.
Tomorrow morning I shall be quite prepared to answer any questions the hon. member may wish to ask in the House. I feel I have met my commitment that an announcement would be made on the date promised. No information is being kept from the hon. member. As I say, if he wishes to ask questions, he can do so: he can ask all he wishes tomorrow and on subsequent days.


Mr. Perrin Beatty (Wellington-Grey-Dufferin-Waterloo):: On this question of privilege, Mr. Speaker, may I simply say that I concur with all the comments made by my hon. friend from Lanark-Renfrew-Carleton (Mr. Dick). There is one central point at issue here, and it is the right of parliament to hear announcements of policy within parliament. As Your Honour is aware, there is an increasing tendency on the part of members of the government to bypass, to downgrade parliament and make announcements outside reflecting government policies and expenditures. The argument which was put forward by the minister is specious. There could be no more cynical condemnation of the ministerial attitude toward parliament.


Mr. Blais:: Read the rules.
Privilege-Mr. Dick


Henry Perrin Beatty: The minister has had enough time to draw up the news release and to have it distributed, enough time to make briefings available to people outside parliament. But he had neither time nor inclination to make a statement on motions within parliament where it could be questioned. His action shows that the government is not concerned about following precedents, it is not concerned about allowing parliament the opportunity to scrutinize its decisions, and it is deliberately attempting to downgrade this institution by making statements outside the House.


Barnett Jerome Danson: Mr. Speaker, the hon. member has indicated that I have briefed people outside parliament. That is not the case. I do not know where he got that information. I am quite prepared to do so from here on in, but that has not been done up until now.


Walter David Baker: Let me say, Mr. Speaker, that I am aware of the precedents in this matter and I am by no means suggesting that the Minister of National Defence (Mr. Danson) is in any way discourteous to the hon. member for Lanark-Renfrew-Carleton (Mr. Dick). In fact, he has been extremely courteous to the hon. member, as he has been to all other members here on a personal basis.


Steve Eugene Paproski: Not to me.


Walter David Baker: But that is not the essence of the matter. I share the feelings expressed by the last hon. member who spoke. A lot of work was done by the committee on procedure and organization with respect to the rules. The whole of our procedure was changed in order that ministers could make statements of significance on what the government might be doing in particular areas. It is obvious from the preparations the minister has described that he regards the statement he proposes to make as being at least of some significance. It is, therefore, the kind of statement which ought to have been made in the House for the sake of parliamentary courtesy if for no other reason. He says there is a newness about the scope of this program. It does not come under the Department of National Defence, but involves public funds and private corporations. This is a case where parliamentary courtesy, as opposed to personal courtesy, has been ignored.
We have raised this matter before, but we have not raised it idly. We raised it because we thought the rule was important. I hope that the minister in future would consider this type of conduct, what it does to this place and what fuel it adds to those who are so irreverent about parliament and who say it is becoming irrelevant. Let him consider it from the point of view of the institution itself. I say that without in any way backing away from the strong feeling which was expressed today by the hon. member for Wellington-Grey-Dufferin-Waterloo (Mr. Beatty). It is an important practice and, as I say, we have not raised the matter idly. I am sorry that the Minister of National Defence has transgressed, but I think he owes us parliamentary courtesy at this time.

March 31, 1977
Privilege-Mr. Dick


James Aloysius McGrath: Mr. Speaker, I rise very briefly in support of the question of privilege put forward by the hon. member for Lanark-Renfrew-Carleton (Mr. Dick). It is becoming a dangerous and growing practice for ministers to exercise the option, which I grant you they have under Standing Order 15(3), to make statements outside the House while the House is sitting. The minister concerned, the Minister of National Defence (Mr. Danson), has twice this session transgressed in this particular area. This is the second time he has gone outside the House while the House is sitting to make a major statement of policy. The last such incident was when he left the House to fly to Gander en route overseas to make a major statement of policy regarding search and rescue.
I think, Mr. Speaker, that the problem is essentially this, and I realize the dilemma that it poses for Your Honour. The government House leader obviously does not want ministers to interfere with his legislative timetable. Consequently, if it is not in the interests of the government House leader to have a statement made, he will tell his ministers there will be no statements today. As a result, they are made outside the House.
Your Honour will say, and rightly so, that obviously this is an anomaly or a deficiency in our rules, that it is something that should be dealt with by the Standing Committee on Procedure and Organization. Even this rule poses a problem because we have had on the order paper since February 10, under government orders, a notice by the government House leader for such a reference to the Standing Committee on Procedure and Organization. It is obvious that the government House leader has no intention of calling that motion, so it just sits on the order paper. Ministers are able to transgress the rule and, if not the rules, certainly the traditions of the House by contemptuously going outside the House and making major statements of policy when it is not in the government House leader's interests to take up the time of the House.
There are exceptions, I am pleased to say. The Minister of National Defence should follow the example of his colleague, the Secretary of State. He made a major policy statement on the subject of youth in the House a few days ago. Members of the House had an opportunity to respond and, indeed, to ask questions. If the minister had any respect for the parliamentary tradition, he would stand in his place today, under Standing Order 15(3), make a statement and give us the opportunity to respond, as did his colleague the Secretary of State.


Allan Joseph MacEachen: Mr. Speaker, there are just one or two comments that I want to make on this particular point of privilege. Of course, the Minister of National Defence (Mr. Danson) is perfectly within his right to choose to make a statement in the House or to choose to make it elsewhere. The rule, which has been referred to frequently, stipulates that a minister may, if he chooses, make a statement, and then it outlines the procedure which is to follow. Hon. members opposite are attempting to set up by their argument the proposition that there is a firm obligation

on the part of a minister to make such a statement. There is no obligation.


James Aloysius McGrath: It is the tradition of the House.


Allan Joseph MacEachen: Hon. members opposite can make that argument, but the tradition or practice has varied. In some cases a statement is made, in other cases it is not.
The hon. member for St. John's East (Mr. McGrath) raised a very pertinent point. He said that every time a minister makes a statement there is a round of comment from hon. members opposite. No one complains about that. Then there is usually a series of questions, and no one complains about that. However, the hon. member is quite right in pointing out that this does take up a considerable amount of time. The hon. member for Don Valley rose in the House and complained about the irrevelance of certain items, and had not been seated more than three minutes when the hon. member for Grenville-Carleton (Mr. Baker) launched the House on a debate of almost two hours on the most tedious question that could possibly have been raised, namely, a point of order on $1 items.


Some hon. Members:: Oh, oh!


Mr. Munro (Esquimalt-Saanich):: And the Speaker ruled you out of order.


Allan Joseph MacEachen: It was a most tedious point of order which was laboured by many speakers on the other side of the House demonstrating the validity of the point which had been made a few moments earlier by the hon. member for Don Valley. Nobody complains about the hon. member for Grenville-Carleton having raised that point of order. He was perfectly entitled to do so. But he could have done it in seven minutes instead of taking an hour and 45 minutes.
The hon. member for St. John's East talks about the rules. He says there is a motion on the order paper which, if it were called and passed, would send the question of the rules to the Standing Committee on Procedure and Organization. I want to tell the hon. member for St. John's East that I asked for the co-operation of his leader to deal with this matter quickly so that the standing committee could do something about the bottle-neck or the impasse he is complaining about. What answer did I get, Mr. Speaker? "It would take several days of debate on the motion of referral itself". I am fed up with the unctuous lectures of. the hon. member for Grenville-Carleton. He ought to clean up his own act and get something done on his side of the House.


Some hon. Members:: Hear, hear!


Donald W. Munro: Mr. Speaker, I do not think we need any lectures on unctuosity. This parliament, according to my definition of "Parliament", is in session to comment on government policy. Government policy is announced outside parliament, as we noticed last week, by the Minister of Transport (Mr. Lang). We now hear from the House leader on the government side that our side ought to
March 31, 1977

clean up its act. It is for the government side to do that. We had before the House draft changes to the rules of procedure of the House, but his party refused to accept them. There is no point in the world in our trying to clean up our act in this regard when the draft regulations that were put forward were held up by the government side of the House.


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I shall not delay your desire to rule on this point, but there are a couple of things I should like to say. First, I was a little surprised that my hon. friend, the government House leader could get so worked up about something that was irrelevant to the point that has been raised today, namely, a point of order raised some days ago by the hon. member for Grenville-Carle-ton (Mr. Baker). I should like to point out to the government House leader that Your Honour declared it to be an important point of order.


Some hon. Members:: Hear, hear!


Ramon John Hnatyshyn: It was not convenient to the government, though.


Stanley Howard Knowles: I should also like to point out to him that if an hour and 45 minutes is the time that was taken on that debate, as I believe it was, it was not all taken by the hon. member for Grenville-Carleton. There were a number of members, who contributed to it. I should also like to point out that Standing Order 12(1) reads:
In deciding a point of order or practice, he-
That is, Mr. Speaker.
-shall state the Standing Order or other authority applicable to the case. No debate shall be permitted on any such decision, and no such decision shall be subject to an appeal to the House.
What I am alleging, may be a bit indirect, but I submit that the government House leader's action today in commenting on that point of order is pretty close to a reflection on the decision made by the Chair.


An hon. Member:: Disgraceful! It is intimidation!


Stanley Howard Knowles: My friend, the Parliamentary Secretary to President of the Privy Council (Mr. Goodale), is feeling pretty good today because the right hon. member for Prince Albert (Mr. Diefenbaker), I believe it was, said that parliamentary secretaries are very high on the totem pole.


An hon. Member:: It was not he. It was the hon. member for Yukon (Mr. Nielsen).


Stanley Howard Knowles: I am sorry, it was the hon. member for Yukon. The right hon. member for Prince Albert knows better.
On the point of making statements outside instead of inside the House, we have had this raised often enough, and Your Honour and your predecessors have ruled often enough, so we all know what the ruling is going to be. You are not in the
Business of the House
position, on the basis of any rules or precedents, to require that a minister make such statements in the House.
Some of my friends said to the hon. member for St. John's East (Mr. McGrath), "Admit that it was not as much a matter of rule as a matter of tradition and practice." I give credit to the hon. member for Timiskaming (Mr. Peters) who put these words in my ear-this is the substance of it and I say it to the government-"Do not stand behind the rules". Of course, the Minister of National Defence (Mr. Danson) has the right to make the statement outside. Any minister can say anything outside the House. But, sir, these are the members of this House, the cabinet ministers in particular, who make speeches about parliament being bypassed, about parliament becoming irrelevant. I submit, sir, that there is no better way to make parliament irrelevant than for the government to go outside the House on radio and television and deal with things out there instead of in here.


Some hon. Members:: Hear, hear!


John R. Rodriguez: Bad manners.


Stanley Howard Knowles: If parliament is as important as some of us believe it is, and if it is as important as the government wants it to be, then they should be making more of these statements in the House. I do not rise to say that you have to rule that they must do it, but I plead with the government that if it wants parliament to be important, then treat it as important.


Walter David Baker: Hear, hear!


Mr. Speaker:: The matter seems to have been canvassed rather thoroughly, again. The precedents indicate that the application of the Standing Order which governs this matter, which is now Standing Order 15(3)-the precedents have been made clear in the past and the language of the Standing Order remains clear that a minister may make a statement in the House on motions. Clearly, it is optional. So long as that Standing Order remains unchanged, the precedents remain applicable. There is no possibility of the Chair finding on a question of privilege. It would run directly counter to the interpretation of the Standing Order that has been upheld several times in the precedents and, therefore, I cannot give the hon. member's proposed motion the special status of a question of privilege.


BUSINESS OF THE HOUSE
Walter David Baker: Mr. Speaker, now that my hon. friend, the government House leader, has bandied with us, he is probably feeling much better today and I wonder if I could ask him about the business for today. I know, of course, about the budget this evening, but I am particularly interested in the business for tomorrow and next week. I wonder if he

March 31, 1977
Business of the House
could tell us what he has in mind for the beginning of the week.


Allan Joseph MacEachen: Mr. Speaker, in reply to the question raised by my esteemed friend from Grenville-Carleton-


Stanley Howard Knowles: It is not a tedious question.


Allan Joseph MacEachen: I am so carried away with my compliment to the hon. member for Grenville-Carleton that I have forgotten my important lines.


Walter David Baker: You have forgotten what you were going to say.


Allan Joseph MacEachen: As hon. members know, we will proceed with the unemployment insurance bill, and following that bill I would like to call the item in the name of the Prime Minister and make one or two comments on that item with respect to the reappointment of the Commissioner for Official Languages.
The budget message will be given tonight. Tomorrow I would like to call Bill C-2, the advance payments legislation, followed by Bill C-26 and Bill C-ll. I guarantee that we will not run out of business tomorrow and create great disappointment among my hon. friends. On Monday we will begin the budget debate. On Tuesday there will be the first vote on the budget debate. I should advise hon. members that I would like to deal with the adjournment motion tomorrow so that hon. members, if the motion is passed, will be certain as to when the House will conclude its business at the close on Wednesday next.


Mr. Speaker:: Further on the same point of order, the hon. member for Grenville-Carleton.


Walter David Baker: Mr. Speaker, the House leader has indicated the order of business as bills C-2, C-26 and C-ll. Is there anything sacrosanct about that order, in his mind?


Allan Joseph MacEachen: Mr. Speaker, if possible I would like to get the third reading of C-2 completed, and variations could be made in the remainder if C-2 were carried.


Mr. Speaker:: On the same point of order, the hon. member for Winnipeg North Centre. (Mr. Knowles).


Stanley Howard Knowles: Mr. Speaker, since this may be the last Thursday before the Easter break, I wonder if I may ask my hon. friend a question about a government bill concerning which I have questioned him many times. I have in mind that he might think about this during the Easter recess. As I understand it, one of the reasons that the minister has not been willing to call the bill about Heritage Day is because he thinks there is too much opposition from the Conservative party. Part of that opposition is based on the belief that the Conservatives do not like the change of the name of "Dominion Day" to "Canada Day". Now that two
lMr. Baker (Grenville-Carleton).]
Conservative members have put down a bill to make that very change, will the minister canvass the situation in the hope that it might be possible to bring this bill on some time after Easter so that we can know well in advance that next February Heritage Day will be in effect?


Walter David Baker: Good idea.


Allan Joseph MacEachen: Mr. Speaker, I am glad there has been an evolution in thinking on this subject. I hope it will result in an early passage and quick passage of the bill after the Easter break.


Mr. Speaker:: Further, on the same point of order, the hon. member for Esquimalt-Saanich.


Donald W. Munro: Mr. Speaker, on the same point of order, I should like to ask the government House leader if the debate on the motion to extend the tenure of the language commissioner is not terminated this evening, would it be continued tomorrow, or when?


Allan Joseph MacEachen: Mr. Speaker, as the hon. member knows, the purpose of this motion is to extend the tenure of the present commissioner for a number of months. It will be the intention of the government, before the conclusion of this session, to bring in a motion appointing a replacement commissioner. There will be an opportunity for hon. members to debate that motion and to debate issues in connection with it. In this particular case, because it is an extension for a few months I would hope that we could deal with it rather quickly. If not today, tomorrow. I would want to reconsider the situation following the fate of this motion later in the afternoon.



ROUTINE PROCEEDINGS


Mr. Speaker:: I have the honour to lay upon the table an extract from the minutes of a meeting of the commissioners of internal economy, held on March 30, 1977, concerning salary revisions of the staff of the House of Commons.


EXTERNAL AFFAIRS
Mr. Speaker:: I believe the Secretary of State for External Affairs wishes to table a document referred to by the minister during question period today.
March 31, 1977


Jack Sydney George (Bud) Cullen: That is correct, Mr. Speaker, pursuant to Standing Order 41(2).


Mr. Speaker:: The right hon. Prime Minister, pursuant to Standing Order 21(2). This notice of motion is transferred to and ordered for consideration under government orders later this day or at the next sitting of this House.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Ralph E. Goodale (Parliamentary Secretary to President of the Privy Council):: Mr. Speaker, the following questions will be answered today: 150, 582, 1,472, 1,853, 1,873, 2,030 and 2146.


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


Hon. Alastair Gillespie (Minister of Energy, Mines and Resources):: The Department of Energy, Mines and Resources reports as follows:
Fiscal Year 1975-76
1. Contract	2. Amount	Contractor(a) Study of the Dynamics of Energy Policy Planning and the Economic Growth in Canada. (Joint contract: EMR 2/3-DOE 1/3)	$34,858	Laval University, Quebec City, Quebec.Forecasts or analyses of major economic events to provide an integrated view of trends in the Canadian economy and their interaction to the department at minimum cost.	4,750	Informetrica Limited, Ottawa, Ontario.A'study assessing availability of commodities and providing an overview of the prospective economic environment of major nations to the year 2000 with a particular industrial view of the world situation as it affects minerals availability.	12,000	Stanford Research Institute, Menlo Park, California.Production statistics and cost data report for copper, lead and zinc, and nickel mines for 1972, 1973 and 1974.	65,000	Rio Tinto-Zinc Services, London, England.
Order Paper Questions
Fiscal Year 1975-76
Contract	2. Amount	ContractorProvide a consulting service on Surveys and Mapping Branch matters.	15,195	L. J. Harris, Ottawa, Ontario.Special Strategic Studies for the Canada Centre for Remote Sensing.	33,300	Systems Engineering Assoc. Ltd., Baden, Ontario.Specific consulting and monitoring services in support of the Working Group on Sensors, also participation in the Canadian Advisory Committee on Remote Sensing.	17,538	P. A. Lapp Limited, Toronto, Ontario.Specific scientific and technical consulting services in the Geoscience Application of Remote Sensing.	21,214	Gregory Geoscience Ltd., Ottawa, Ontario.Development of Operational Performance Measurement System Proxy Level I and 11 for Surveys and Mapping Branch.	24,500	Quasor Systems Ltd., Ottawa, Ontario.Study on the Cost Recovery Units (Map Sales) of the Surveys and Mapping Branch with view to improvements in the system.	7,500	Price Waterhouse & Associates, Ottawa, Ontario.Review of the systems of financial administration as related to the Canada Centre for Remote Sensing.	35,000	Audit Bureau of the Department of Supply and Services, Ottawa, Ontario.3.	Fiscal Year 1973-74 (a) $119,328; (b) Nil.


Mr. Stevens: 1.	Does the Post Office Department have a contract with Philatelic Consultants Ltd., of Providence Rhode Island, for the distribution of Canadian stamps in the United States and, if so (a) on what date was it signed (b) what are its terms (c) on what date does it terminate (d) was a general tender called before letting the contract or was Philatelic Consultants Ltd. the only agent considered?
2.	Is the contract with Philatelic Consultants Ltd. a sole distributorship or are there other agents selling Canadian stamps in the United States and, if there are others, what are their names?
3.	Do the terms of the contract provide for payment of a commission of up to 30 per cent on any sales and, if not, what is the discount or commission arrangement with Philatelic Consultants Ltd. and any other agents?
4.	What (a) is the face value of stamps sold (b) commission or payment has been paid to Philatelic Consultants Ltd., to date?


Hon.   J.-J. Blais@Postmaster General: 1. Yes. (a) April 2, 1975. (b) The main terms are that Philatelic Consultants Ltd.: (i) shall sell Canadian stamps at face value, (ii) shall not sell new issue stamps before their official first day of sale; (iii) shall provide to the Post Office Department a guaranteed irrevocable letter of credit against the inventory of Canadian stamps and related products received from the department; (iv) shall submit inventory and sales reports and make pay-
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March 31, 1977
Order Paper Questions
ments to the Post Office Department on a quarterly basis, (v) shall be responsible for any loss or theft of or damage to any consigned Canadian stamps and postal related products, (c) March 31, 1978. (d) Although a general tender was not called, other agents were considered.
2.	The contract with Philatelic Consultants Ltd. is a sole distributorship.
3.	The terms of the contract provide for payment of a commission on sales on a yearly basis as follows: (a) 10 per cent on sales up to $50,000 per year; (b) 15 per cent on sales exceeding $50,000 but not exceeding $100,000 per year; (c) 20 per cent on sales exceeding $100,000 but not exceeding $200,000 per year; (d) 25 per cent on sales exceeding $200,000 but not exceeding $500,000 per year; and (e) 35 per cent on sales exceeding $500,000 per year.
4.	(a) $195,870.92; (b) $31,674.18.


Mr. Howie: 1.	What is the total cost of the federal swine flu vaccination program?
2.	As of January 1, 1977 how many persons had been vaccinated?
3.	How many persons were eligible for vaccination?
4.	How much surplus vaccine has been disposed of or is to be disposed of?


Marc Lalonde: 1. Total costs of the swine flu vaccination programme have not yet been determined since the provinces have not yet decided whether this vaccination programme will be re-instituted or curtailed. Costs of the vaccine and costs of administering the vaccine are a provincial responsibility, except for vaccine administered by the various federal agencies which have responsibility for particular clientele such as the native populations, the armed forces and patients in veterans' hospitals. Cost to the Laboratory Centre for Disease Control for influenza surveillance and for meetings of the National Advisory Committee on Immunizing Agents approximate $80,000.
2.	Firm figures are not available from all provinces. However, based on estimates of 30 per cent utilization of distributed vaccine, approximately 1.5 million doses have been given, predominantly bivalent vaccine.
3.	It has been calculated that three million persons were eligible for bivalent (A/New Jersey and A/Victoria) influenza vaccine and a further nine million for the monovalent (A/New Jersey) vaccine. 4
4.	The Department of National Health and Welfare is not aware of the disposal or plans for disposal of any surplus vaccine by the provincial authorities. A number of provinces have indicated their intention to stockpile unused vaccine.
IMr. Blais ]


Mr. Herbert: 1.	For what reason is an effective 15% discretionary import tariff on agricultural chemicals not exercised?
2.	What is the tariff on agricultural chemicals exported by Canada into the United States?


Hon. Donald S. Macdonald (Minister of Finance):: 1. Basic agricultural chemicals used in the formulation of pesticides are allowed to enter Canada duty-free although under the General Agreement on Tariffs and Trade (GATT) the duty could be increased up to 15 per cent. It has been the general policy of successive Canadian governments to provide duty free entry for most agricultural inputs. To this end, formulated pesticide products are bound at free under the GATT. The agricultural chemicals used to make these pesticides are, therefore, also provided with free entry.
2. The duty on agricultural chemicals of the kind described above imported into the United States is generally 1.7 cent per pound plus 12'/2 per cent


Mr. Baker: 1.	Will the new Public Health Building house the facilities for research into communicable diseases?
2.	Will the facilities include washing facilities for animal cages and, if so, at what cost?
3.	Are the washing facilities in the present Building being walled up and, if so, for what reason?


Marc Lalonde: 1. No.
2.	Yes, at an estimated cost of $90,000. (At present, the contractor is able to provide only a lump sum figure that includes eight sterilizers).
3.	The cage washers in the Laboratory Centre for Disease Control Building are being walled up temporarily since the cost of relocation, $ 160,000, is considered prohibitive.


Mr. Herbert: 1.	As a share of all energy used in Canada today, what percentage is (a) oil (b) natural gas (c) coal (d) hydroelectric (e) nuclear?
2.	What are the estimated percentages for the year (a) 1990 (b) 2000?


Alastair William Gillespie: The Department of Energy, Mines and Resources reports as follows: 1. Preliminary estimates of Canadian primary energy consumption in 1976 yield the following shares for each energy commodity: (a) oil 45.4 percent (b) natural gas 18.1 percent (c) coal 8.4 percent (d) hydroelectric 26.1 percent and (e) nuclear 2.0 percent.
2. There are many possible energy scenarios for the years 1990 and 2000 but one case, which closely approximates the
March 31, 1977

high energy prices/low economic growth scenario described in "An Energy Strategy for Canada", yields the following shares:
	(a)	(b)
	1990	2000
oil	39.7	35.8natural gas	20.3	20.9coal	8.5	7.5hydroelectric	23.6	22.9nuclear	7.9	12.9
NOTE: Hydroelectric and nuclear are valued at their fossil fuel equivalent (lKwh = 10,000 BTU'S).


Mr. Howie: 1.	In 1976, were written complaints received by CRTC about violence or immoral conduct on programmes aired by Canadian television stations and, if so, how many?
2.	How many investigations were undertaken in response to such complaints?
3.	How many investigations resulted in action being taken by CRTC against the offending station and, in each case (a) what was the action taken (b) against whom was action taken (c) what was the specific offence acted against?


Hon. Jeanne Sauve (Minister of Communications):: The
Canadian Radio-television and Telecommunications Commission (CRTC) has submitted the following: 1. Yes, 174 complaints from September 1, 1976 to March 14, 1977.
2.	No investigations were undertaken in response to such complaints. Matters of violence or alleged immoral conduct are an aspect of programming. Under the Broadcasting Act "all persons licensed to carry on broadcasting undertakings have a responsibility for programmes they broadcast...". As a consequence, complaints from the listening or viewing public which the Commission receives are sent to the licensee by the Commission, requesting that the licensee respond to the writer setting forth how he, the licensee, sees his responsibilities in connection with programming of this nature. The commission is not a censor. It expects the licensee to be responsible for the programming broadcast and it is regular commission practice to examine each licensee at public hearings for the renewal of a licence, in connection with the programmes they broadcast. Direct intervention in the programming of Canadian television licensees by the commission is not authorized under the Broadcasting Act. Such intervention to prohibit or control violent or immoral scenes could only be accomplished through new legislative action by Parliament.
3.	Not applicable.


Ralph Goodale: Mr. Speaker, if questions Nos. 1,201 and 1,466 could be made orders for returns, these returns would be tabled immediately.
Order Paper Questions


Mr. Schumacher: 1.	In each year 1970 to date, what amount has been spent by the Post Office Department in each province and, in each case, what was the purpose of such expenditure?
2.	In the Province of Alberta, how many post offices and sub-post offices have been (a) closed (b) opened each year since 1970, and where did each such closure or opening take place?
3.	In the City of Calgary each year since 1970 to date, what improvements have been made in the (a) North West (b) North East (c) South West (d) South East (e) central sections and what was the (i) nature of each improvement (ii) cost involved in each case?
4.	In the City of Calgary at the present time, are there any householders within the city limits who do not receive door-to-door mail delivery and, if so (a) how many (b) for what reasons (c) what alternative arrangements has the Department made in each case (d) on what date does the Department plan to extend door-to-door mail service to them?
Return tabled.


Mr. Lambert (Bellechasse): 1.	During the fiscal year 1975-76, did the government subsidize the transport of feed grain and corn in (a) Quebec (b) the Maritimes (c) Ontario and, if so, in each case, by what amount?
2.	In Quebec, to which corporations, cooperatives and others were those subsidies granted and what was their amount in each case?
3.	During that same period and for the various regions of Quebec, what were, per bushel, hundredweight or ton the (a) transport charges of those commodities (b) amount of the subsidies granted by the government?
4.	During the same period, how many bushels, hundredweight or tons of (a) feed grains (b) corn were transported in Quebec?
5.	In the case of corn, for what quantity of (a) Canadian (b) American corn did the government grant subsidies?
Return tabled.


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


Some hon. Members:: Agreed.


Mr. Speaker:: I have the honour to inform the House that a message has been received from the Senate informing this House that the Senate have passed without amendment Bill C-37, an Act to provide for the making of certain fiscal payments and of established programs financing contributions to provinces, to provide for payments in respect of certain provincial taxes and fees, and to make consequential and related amendments.
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March 31, 1977
Employment and Immigration



THE ROYAL ASSENT

Mr. Speaker:: I have the duty to inform the House that a communication has been received which is as follows:
March 31, 1977 Sir,
I have the honour to inform you that the Honourable R. G. B. Dickson, LL.D., D.C.L., Puisne Judge of the Supreme Court of Canada, in his capacity as Deputy to the Governor General, will proceed to the Senate Chamber today, the 31st day of March, at 5.45 p.m., for the purpose of giving Royal Assent to a Bill.
I have the honour to be,
Sir,
Your obedient servant.
Edmond Joly de Lotbinidre Administrative Secretary to the Governor General



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Wednesday, March 30, consideration of the motion of Mr. Cullen that Bill C-27, to establish the department of employment and immigration, the Canada employment and immigration advisory council, to amend the Unemployment Insurance Act, 1971, and to amend certain other statutes in consequence thereof, be read the second time and referred to the Standing Committee on Labour, Manpower and Immigration.
Mr. Robert C. Coates (Cumberland-Colchester North):: Mr. Speaker, in the few remarks I was able to make yesterday afternoon I mentioned the speech delivered by the hon. member for South Western Nova (Miss Campbell). I intend to make some further comments on that speech, but prior to doing so I should like to make some general remarks about the legislation in question as well as the new responsibilities that will be assumed by the Minister of Manpower and Immigration (Mr. Cullen) who will become minister of employment under the legislation.
First of all, I should like to say to the minister that I support the objectives contained in the legislation from the point of view that I believe it is a realistic proposition once again to unite the manpower operations of the government with the unemployment operations of the government as it has existed for many years. From that point of view, I think it is only fair to say to the minister that in a personal way I have found a tremendous burden has been placed upon members of the

Manpower operation and the Unemployment Insurance Commission since the time the legislation that we are now amending was passed.
I think my experience is not unique. It is no different from that faced by many members across the country through the tremendous increase in the workload of our offices as a result of the amended act. This has happened for a number of reasons, the first being that the former unemployment insurance legislation was in place for a very long time and therefore the work force understood it. Suddenly there was new legislation that carried with it many aspects which were not clearly understood by the work force and, as a result, there were many problems. I think these problems were tremendously worsened by the fact that the UIC was computerized at about the same time and there were many breakdowns and things of that nature.
I think the minister and his employees should know that we appreciate the tremendous amount of hard work done by people in the Unemployment Insurance Commission. They have done everything they can to eliminate the many problems which have developed. There is no doubt that workers were not used to computer cards when completing their claims and many problems were created in that way, and also from a public relations point of view. The staff of the Unemployment Insurance Commission, with some exceptions, did a tremendous job in reacting to the problems faced by unemployed workers. For this they deserve a pat on the back, rather than a kick in the pants as we are so often inclined to give them, because this or that particular situation makes people upset.
Through my office I am in daily contact with the Unemployment Insurance Commission, and I find that if there is any way they can shorten the route to the resolution of a problem, they will use it. I believe they deserve credit and they should be told by the minister, on behalf of members of this House, that we appreciate the co-operation they give our staffs in trying to solve problems. I think we are very fortunate to have this minister at the present time.


Some hon. Members:: Hear, hear!


Robert Carman Coates: From the point of view that whether as a backbencher, a parliamentary secretary or whatever, I have always found him co-operative.


Some hon. Members:: Hear, hear!


Robert Carman Coates: I think the government could not have been more unkind to him however, than in trying to put this legislation through the House at this time. A year ago I anticipated that the government would move in this direction because it was obvious that the Unemployment Insurance Commission was getting well beyond an insurance scheme and was becoming more of a welfare scheme. It was obvious that something had to be done to get control of the situation and put in place a scheme that was more insurance than welfare. The Canada Assistance Plan is available to look after the welfare needs of our society which are very much a burden on many people who want to work today and cannot find jobs.
March 31, 1977

From that point of view I asked my constituents whether they believed the period for qualification should be extended. A considerable number of them indicated that they believed, as we believed when the original legislation was before the House, that there should be a longer qualification period. So it would not be reasonable for me now to say to the minister that I do not believe in the concept of extending from 8 to 12 weeks the period for qualification, but I do think it is very difficult for any member of the House, in view of the fact that close to one million people are unemployed in this country, to try to take any type of action that may result in the disqualification of people who are now qualified to receive benefits, or to put an individual in a more difficult position when there are not sufficient jobs available to secure a job.
I understand there are some 13 members in the minister's own party who have expressed deep concern over the extension of the qualification period from 8 to 12 weeks. I have heard the minister say that he is concerned about that, that he is flexible. I do not know how flexible he is. The minister has been informed by our party that we intend to move some amendments in committee which will reflect the concern that all members have about this matter, and I hope that serious consideration will be given to this situation because I believe that what the minister is endeavouring to do is right. But I also believe we must give serious thought to the heavy unemployment situation in our country at this time. We should be able to find a compromise at least for a period of time until we overcome the problem. So it pleases me to know that the minister is at least giving serious consideration to this problem and is not so determined or intransigent to just give us this legislation and say, "You can take it or lump it, whatever you want".
One of the things that, unfortunately, is associated with Standing Order 75C is the fact that the type of legislation it encompasses poisons the air and eliminates some willingness, on the part of some hon. members at least, to be as co-operative as they might otherwise be. I understand that there are timetables to be met and things of that nature. I am just sorry that a closure motion has to be imposed on this piece of legislation, because to a degree it eliminates the spirit of co-operation that would exist otherwise.
One of the things that has concerned me about the debate- and it is an understandable problem-is the fact that we are debating, in respect of this piece of legislation, an insurance scheme. We are not really debating problems associated with the malaise that is in the economy at present. I hope that when the Minister of Finance (Mr. Macdonald) brings in his budget tonight, that malaise will be eliminated at least to a degree and, there will be a softening of the hard attitude of the government with regard to the unemployment situation. But while I appreciate it is hard to separate the two, what we have to look at is the fact that we are indirectly taxing the Canadian nation an excessive amount because the scheme, in its present form-which will be changed with this legislation-is not capable of paying the bills. We have to work out, if we are
Employment and Immigration
going to eliminate some of the pull that we have on the money markets, some of the problem areas that exist in the Unemployment Insurance Act because of the extent of unemployment.
The minister has always been a very helpful supporter of the scheme to harness Fundy tidal power. Throughout the period of time that he has been in the House he has endeavoured to associate himself with the Atlantic provinces as often as he could. I am sure he appreciates the extent of unemployment and the terrible problems we are facing throughout the area. For instance, in my constituency the town of Truro has always had one of the healthiest economic bases of any town in the maritime provinces. But now it is in grave difficulty. It has an unemployment rate of close to 20 per cent. It is hard to believe, because it has so many industries and there is so much diversification of industry there.
My home town of Amherst usually reflects the economy of the area, but Truro has always been an area with a very low unemployment rate. However, that is not the case at present. I am only saying that to impress upon the minister, as the minister of manpower or as the minister of employment, as he will become, that he should put some extra push behind a project like the Fundy tidal project in the days ahead, because I know he realizes the potential of that project, he realizes what it will do for employment in the maritime provinces and that it is the kind of project that will revitalize the economy of the area as well as partly solve the difficult energy problem we face there. So I hope the minister will do his level best to see that that project is given an increased impetus in the days ahead in the hope that we can get it on the rails and provide the jobs that the people require.
While I am anxious to bring to the minister's attention the good work that his officials do so far as I am concerned in my daily discussions with them, situations occur from time to time which, I believe, merit special consideration. I have a constituent by the name of Lloyd D. Gilroy who has been disqualified from unemployment benefits. The situation has now reached the point where he has had to hire a lawyer. That lawyer made a request to have the case submitted to an umpire. I received a letter from the lawyer, Larry A. McKim, Mr. Gilroy's solicitor, who informs me of this fact. 1 am pointing this out because I think it is important that the minister's officials think very carefully, especially at a time of high unemployment, before making certain decisions which may result in a disqualification by deceiving the individual whom they are interviewing, whether they are doing this intentionally or because they feel the person is not making a real effort to secure employment for himself or herself.
In his letter, Mr. McKim wrote the following:
Two things about this case bother me a lot, I guess because both seem contrary to natural justice. One is the trickery of "getting" one to refuse a job which doesn't exist (alleged labourer's job in Springhill) and the other dealing with the UIC's not adequately, if at all, stressing to the claimant the principle as set forth in the letter from George Lambert, departmental assistant, to you dated March 5, 1977, "... That if a claimant is still unemployed after a reasonable

March 31, 1977
Employment and Immigration
period of time has passed, it is expected that he should broaden the area of his search for work and relax the restrictions on the type of job he would accept. If he does not do so, he cannot be considered fully available for work and benefits are suspended". As to this principle, it seems to be sacred unto the UIC people, who apparently do all the interpreting of the phrases ''reasonable time", "broaden the area of his search", and "relax the restrictions". The trick is to let the claimant delimit himself for a while, within the so-called principles, and then inject some new principles into the game, something like coming up with a ground-rule double after a hitter has run all the way from home to third.
From time to time I encounter these situations, and usually after discussion with the claimant so that he fully understands his responsibilities with respect to seeking employment and after talking with the insurance officer, the problem is solved. I have talked to the gentleman involved in this particular case on a number of occasions, and it upsets me that an insurance officer will take a position which makes it impossible for a person to be able to seek employment in the area in which he feels he should be seeking it. For instance, in this particular case the gentleman in question had just purchased a new home in the area where he had been working. It was suggested that he go a distance from one area of close to 70 miles and from another area of close to 50 miles to work. That person just happened to purchase a home, and it was impossible for him to do that. When insurance officers enlarge the scope, they sometimes can create inequities or, as Mr. McKim puts it, they can eliminate natural justice with respect to what insurance officers know people can do.
I put this particular case before the minister because I think the individual was treated unfairly. I do not think the minister or the UIC want anyone to be treated unfairly. The objective is to see that people who are receiving unemployment insurance benefits are entitled to them. In the past six or eight months there has been a tremendous difference in the operations of the UIC with respect to eliminating people who formerly took advantage of the fund and secured benefits to which they were really not entitled.
I feel that the work force has displayed a different attitude. As long as a person knows his chum is getting benefits to which he is not entitled, he almost feels he is entitled to the same thing. However, when he discovers that his chum is suspended from receiving benefits or is prosecuted and faces severe penalties by way of the elimination of benefits and the paying back of substantial portions of what was received illegally-although I do not think people ever interpret that as illegal-he conducts himself differently. As long as we have a system under which one fellow can get away with receiving benefits improperly, other people will wonder why they should work when they can draw unemployment insurance benefits and con themselves into thinking they are entitled to them.
I feel that the officials of the Unemployment Insurance Commission are to be congratulated for being as alert as they were after the department indicated it wanted much stricter enforcement of the rules of the game. The rules of the game are now better because more justice is applied and more protection is available.
I should like the minister to give consideration to the fact that there are still a great many people who contribute to the unemployment insurance fund but who never draw any ben-

efits. There are a number of people who, because they have spent a large portion of their lives paying into this fund and have never received anything from it, want to draw benefits. They think that if they do not get something soon they will never get anything because they will soon be too old to qualify. It may take some work on the part of the minister's officials, but there should be a method worked out whereby a great many people could be provided an incentive so that they will not be tempted to draw benefits. If they knew there was something available in dollar terms at the end of their working life because they had not dipped into the fund, they might not be tempted to draw benefits for short periods of time.
The minister should undertake an examination of some type of incentive scheme which would provide special benefits to people who contribute to the fund year after year with no hope of ever drawing benefits. Their only satisfaction is the knowledge that they are helping their fellow workers who are involved in different types of work and find themselves unemployed from time to time.
Yesterday I made some comments about the hon. member for South Western Nova (Miss Campbell). I do not want to be unfair to the lady, but I find her approach to this legislation and to our area very negative. She indicated to this parliament and to the people of our province that our way of life is committed to unemployment insurance. I think there is a much more positive way to approach the unemployment problem in our area, and it is not by itemizing, as the hon. member did, the loss to the Atlantic provinces which will result from this legislation. At page 4497 of Hansard the hon. member said the following:
In terms of the loss of funds to the Atlantic provinces, if it is assumed that their loss is in proportion to the number of beneficiaries with 8 to 11 weeks in 1977- 11,496-then the loss would be between $63 million and $76 million in 1977.
In other words, the hon. member was saying to the people of Nova Scotia that because we are going to make the unemployment insurance fund an insurance fund rather than a welfare scheme, the government is going to take $63 million to $76 million out of the pockets of the people. I do not want to think that the people in my constituency have to look forward to unemployment insurance as their lifeline to security, three meals a day, and so forth.
I think the hon. member would be much better advised to propose schemes to the minister which would provide employment to those who would otherwise be unemployed between 7 and 11 weeks. But I say such employment should not be provided through Canada Works, LIP or similar programs. It can only be provided by allowing private enterprise to underpin our economy, by allowing it to work effectively. The government should not suck dollars out of the economy and spend them on public works projects. As it is, tax dollars are being taken out of the economy and used to provide jobs which taxes have eliminated.
I will not quote much more. The hon. member was crying the blues about her part of the country. She mentioned, as
March 31, 1977

reported on page 4497 of Hansard, that her area will lose $57,616 per week if this bill goes into effect. Then she said that if you multiply that figure by 52, there being 52 weeks in the year-a most profound observation-the result is $2,996,032. That much will be lost to her area. That may or may not be correct. I say that if the government puts in place proper programs to employ the unemployed, there will not be so many claimants drawing on the fund. And if they are forced to draw on the fund because they will have been employed for a long enough period they will qualify for benefits under the new scheme. The members of my area must try to make constructive proposals for eliminating unemployment. We should not encourage what I call the welfare syndrome; we should not encourage our people to rely on unemployment insurance benefits, welfare or any other benefits of that kind. I hope the hon. member will revise her philosophy on this bill and show some concern for people of her area. If she does, perhaps constructive steps will be taken in her area in the days ahead.
In conclusion, let me say that I hope the minister will be flexible in implementing the new proposals contained in this legislation. I say this bearing in mind present-day conditions, not because I oppose the objectives of the bill. The government, by having the Minister introduce the bill at this time, has not done anyone any favour. I only hope we shall be able to devise a scheme which will be workable in the long run, self-sustaining and help to eliminate some of the difficulties we have faced in the past.


Jack Sydney George (Bud) Cullen: Mr. Speaker, will the hon. member permit a question? I may have misunderstood the hon. member's comments but it seems to me he was somewhat inconsistent. I understood the hon. member to say that the unemployment insurance bill is departing from insurance principles. Then, near the end of his remarks, he suggested that we should depart even further from insurance principles by saying to those who would collect unemployment insurance, "If you do not collect unemployment insurance, we will set up a little fund for you." I wonder if the hon. member's suggestion would not involve an even further departure from the insurance principle.


Robert Carman Coates: Mr. Speaker, with respect, no, I do not think so. Perhaps the hon. member did not understand me. I think that if we provide incentives for not drawing unemployment insurance, people who may be unemployed for a short period will not draw on the fund. Perhaps as an inducement we could provide a small payment. But in the end the government will save money since fewer people will try to collect from the fund. I suggest we could give the people who never draw money from the fund a little bonus as a reward.
Let me illustrate what I mean. The hon. member for Qu'Ap-pelle-Moose Mountain (Mr. Hamilton) told me of a school board in Saskatchewan which had tremendous difficulties with employees taking extensive sick leave. Every time a teacher stayed off sick, the board had to hire a substitute teacher, and this cost much money. In the end the board said to its employees, "If you do not take sick leave for a certain period,
Employment and Immigration
we will pay you a bonus." The scheme worked. Because of that incentive, the problem of sick leave was almost entirely eliminated. As it is now, many employees say from time to time, "Well, I have worked so many weeks now; it is time to draw a little benefit to get back some of the money paid in." That is the feeling of many who pay insurance premiums. I think the minister's officials should consider this idea. I think Dr. Clark, who prepared a report for the department several years ago, made a similar suggestion. Perhaps it is possible to conceive a scheme which will make people think twice before they avail themselves of benefits from the unemployment insurance fund. At present they do not think twice. Perhaps the minister may not think what I have said is a satisfactory explanation, but it is a suggestion.


Mr. William Rompkey (Grand Falls-White Bay-Labrador):: Mr. Speaker, I shall keep my comments brief since I know a number of my colleagues wish to speak. First, I echo the sentiments of the hon. member who preceded me. I agree with what he said about the minister. I have the highest respect for the minister. I think he has made an honest attempt to design legislation in the best interests of all the people of this country.
I rise to speak on this bill with mixed feelings. Let me deal, first, with some of the good aspects of the legislation.


Ramon John Hnatyshyn: That shouldn't take long.


Bill Rompkey: I say this because, contrary to what some people have charged, not all parts of this legislation are completely bad.


Ramon John Hnatyshyn: Which parts?


Bill Rompkey: I say to the hon. member, "Take it easy." First let me say that the joining together of the two branches of the department is a good idea. I remember that I had the privilege in 1973 of spending two weeks in West Germany with other parliamentarians looking at the national employment service of that country. Without question, a one-stop shopping centre, so to speak, is a good idea and I agree with that aspect of the bill. I repeat, as I said before, that if the minister decentralizes the work of his office, once that union is complete he will make his organization more effective. I think smaller, regional offices under the new union will be a step forward. Another good aspect of the bill is the improvement in maternity benefits. I welcome another provision of the bill which will affect my riding. I am referring to that part of the bill which will allow one not to terminate a claim after working four weeks. Right now, if people claim work four weeks or more they must put in a new claim. That has caused a lot of hardship to people, particularly in the rural areas of my riding. Those people are often short-term claimants. This aspect of the bill will be good news to them. Nor can I disagree with the need to tighten the system across the country. There are parts of this country where the system needs to be tightened and where there is a great lobby to have the unemployment insurance system, as it obtains at the present time, considerably tightened.

March 31, 1977
Employment and Immigration
The controversial parts of this bill are the increase in the qualifying period from 8 to 12 weeks and the changes in the extending period. I realize there is a strong lobby for these things in many parts of the country. Many people are concerned with what they consider to be a rip-off of unemployment insurance. There is no doubt that in certain areas and in certain cases a rip-off is occurring. We must use all means within our power to ensure that does not happen.
I want to represent today, as is my responsibility and privilege to do in this House, a group of people who may be a minority in this country. They will be adversely affected by changes in this legislation. These people live in the rural parts of my constituency, particularly along the northeast coast of Newfoundland where there are not job alternatives. In certain parts of the country where there are job alternatives there is no question at all but that the act should be tightened along these lines. I want to put on record the feelings of these people. They may be a minority, but this party has always attempted, and attempted very well, to represent the feelings and positions of the minority groups in this country.
Much as this government has done to create jobs, and it has done more than any other government in the history of this country, much as we have put money into DREE and equalization grants across the country, LIP and Canada Works, there are still people in this country who cannot find alternative jobs. When this legislation comes into effect there will still be people in that position. They may be in a minority, but we have to think about and make provision for them. Where can we provide jobs for the people in the Atlantic area? They will jump at them. It is a myth that people are not prepared to work and would rather exist on unemployment insurance. All we have to do for evidence is look at the number of applications that come in for LIP and Canada Works. There are five or six times as many applications from my constituency as there is money that can be funded. People are looking for work in their own area. The work ethic is strong in Newfoundland and Labrador and, indeed, throughout the maritime area. People are looking for legitimate jobs. They will take them wherever they can find them. Look at the number leaving the Atlantic area, going to other parts of Canada, the continent and the world in search of jobs.
I have heard of people from the Atlantic area going to Ontario for a while, staying eight weeks, drawing unemployment insurance and going back home again. In the city of Toronto there are hundreds of thousands of Newfoundlanders who have gone there, stayed there, raised their families there and obtained permanent jobs there because they could not find them at home. It is not true that these people are taking advantage of the system. There are Newfoundlanders who have gone to Toronto, Hamilton, Galt, and many other areas seeking jobs because there are no jobs at home.
There are structural weaknesses in the economy of the Atlantic area. I realize that job creation is much better than just providing unemployment insurance. However, we are putting the cart before the horse. By creating jobs we will take

people off unemployment insurance automatically. Until such time as we can correct those structural weaknesses and create those jobs, let us not take away the only support that these people have at the present time. Let us not take away their integrity and self-respect. Let us not force them to accept welfare and for some people that would be the only alternative.
Must we have a rigid system in this country? Must we have a system that applies in the same way in every part of the country? This government recognizes regional differences in DREE, the provision of equalization grants and in the allocation of moneys under LIP and Canada Works. Can we not recognize these regional differences in applying these unemployment regulations? I want to put before hon. members the Greek figure of Procrustes, a man associated with Greek hostelry. He had a bed of one size. Every guest who came to the hostel had to fit the bed, no matter how big or how small he might be. If a man was too long, he chopped off his legs to fit the bed. If a man was too short, he elongated him to make him fit the bed. Up until the present time this Liberal government has not had a Procrustean philosophy. This government has had a policy which has recognized regional differences.
I make a strong plea that in this legislation we again recognize that there are regional differences in this country which have to be accounted for and for which provision must be made. If we are to have a strong country, we must allow for these regional differences. There is a debate now going on in this country. That debate concerns not only linguistic and cultural differences, but social and economic differences as well. I hope we can allow for those in this legislation.
Let me say again that the people in the Atlantic area would much prefer jobs to unemployment insurance. The evidence is there. However, let's not put the cart before the horse. There are areas in this country where the increase in the qualifying period from 8 to 12 weeks will be welcomed. There are other areas where it will hurt the minority groups and little people which this party has always attempted to defend.
It may be difficult to be liberal in this day and age when much of society is swinging to the right, but I say again that we have always tried to provide for the minorities in this country and have tried to give them a voice. I hope we can consider their plight at this time. I hope we can have an assurance from the minister that job creation will be in those areas most affected, or that the system will be flexible enough to accommodate the needs of various areas in this country, particularly the Atlantic area.
I want to put on record a telegram I received today from a member of the House of Assembly in my constituency. It expresses the feelings of many people in my constituency:
It is with regret that I feel compelled to convey to you my strong objections to your proposed changes in UIC regulations especially those that would increase the qualifying period for benefits from eight to 12 weeks. I am convinced that this increase in the qualifying period will bring undue hardship and economic suffering to many thousands of my fellow Newfoundlanders.
I will not read the whole telegram. There are areas of. the country that will be affected by this legislation. I hope we can
March 31, 1977

come up with a system that will make provision for people who have no alternative at the present time.


Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, as everyone knows, Bill C-27 is intended to amend the Unemployment Insurance Act, 1971. Unfortunately, this bill contains very few suggestions to provide the unemployed and those looking for jobs with a glimmer of hope to improve their situation. Members of parliament have received background papers and letters from different organizations with regard to the problems of unemployment insurance. Many have prepared excellent background papers. I wish to refer to one in particular, that of the Canadian Manufacturers' Association. It contains some very interesting points. I quote:
In the face of such substantially and demonstrably higher payroll costs one might ask, "Where would you locate a new plant to serve the North American market?" Even more to the point, for purposes of this discussion, "How long can we realistically expect to maintain existing jobs, let alone create new ones, when our costs are higher than the Americans?"
Now let's look at a specific social security program-unemployment insurance. Last year (1976) the total (state and federal) cost of U.S. unemployment insurance benefits was $15 billion. It caused an uproar in Congress because previously the annual cost in the U.S. (with ten times the Canadian population) had been between $3 and $4 billion!
In 1976 Canada's unemployment insurance cost almost $3.4 billion!!!
Despite higher unemployment rates in the U.S. throughout 1976, the cost of the U.S. program was approximately one-half that of the Canadian program whether viewed from the standpoint of dollars per person employed or as a percentage of GNP.
These are startling figures. When the United States can operate its program at half the cost, it shows there is something radically wrong in this country.
In light of the foregoing CMA intends to tell the house committee reviewing Bill C-27 that parliament, in the name of responsible government, has no alternative but to take steps to bring some of these comparative figures into line before even more jobs are driven out of Canada.
In this connection we propose to use charts to demonstrate those aspects of our unemployment insurance program which are badly out of line with the U.S.
One aspect of the Canadian program which cannot be quantified accurately is the rate of labour turnover. Studies by the U.I. Commission as well as an independent study by Simon Fraser University arrived at different estimates as to the percentage of unemployment which is induced by the disincentive features of our existing program. The important point is that, whatever the percentage, the studies agree that the existing program does induce unemployment and high labour turnover. Turnover rates of 200 to 300 per cent are reported by CMA members offering the highest wages in their communities and add to what economists refer to as "frictional" unemployment. The aggregate hiring costs and the extent to which this turnover inflates our unemployment rate cannot be measured by CMA and we will therefore not have charts to demonstrate these points.
They go on to say:
We shall, however, offer charts to the House committee on those points which are measurable. As an example we will point out that the average qualifying period in the U.S. is 25 weeks and that nowhere in the U.S. do they have a qualifying period as low as eight weeks, or even our proposed 14 weeks!
So when we suggest we are introducing a 12 week qualifying period we are certainly not being out of line or unjust in this country.
At the same time we will note that maximum benefits in Canada are $133 per week (with an automatic annual inflator), compared with an average maximum
Employment and Immigration
of $96 per week in the U.S. In some states benefits go as high as $130 but they also go as low as $60.
Of course that is one of the general complaints in Canada- that our benefits are far too generous. They are certainly not inducing people to look for work.
Similarly invidious comparisons appear when we examine benefit levels and duration of benefits.
Faced with this reality is it any wonder that U.S. interests are repatriating investment capital-and the jobs that go with it-to the U.S.? Is it a wonder that Canadian investment capital, and jobs, are going in the same direction?
It isn't easy for a politician to tell it like it is when, in fact, the truth hurts. But can responsible politicians do less than tell Canadians the truth in terms of the costs and effect of our current unemployment insurance program? Do they owe Canada anything less than these simple truths if we are to reverse the flight of jobs?
I should like to point out that we in the Conservative party called, in the last federal election, for a complete and independent review of the unemployment insurance scheme which is now costing us about one tenth of our whole budget. The size of the commission staff keeps increasing and there is every indication that this is not one of our better run corporations or government departments. It is certainly time that a complete overhaul was embarked upon and an independent inquiry conducted.
I should like to mention an incident which came to my attention in downtown Ottawa. A couple of weeks ago I was driving by the premises of a plumbing firm. There was a large outdoor sign near it, stating in huge letters "Full-time truck driver wanted". I cannot understand why any firm would need to put up a big billboard indicating they wanted a full-time truck driver. It would certainly suggest to me that the UIC was not doing its job properly, inasmuch as it would seem to have failed to find a truck driver for a plumbing firm in Ottawa.
A few days ago we received some propaganda from the Minister of Manpower and Immigration (Mr. Cullen). He sent members of parliament a note letting us know what Senator Humphrey had been doing in the United States. The note said:
Dear Colleague:
Senator Hubert H. Humphrey, Vice-Chairman of the Joint Economic Committee of the Congress of the United States, has recently written to me concerning youth employment programs in our respective countries.
Last January, Senator Humphrey introduced a comprehensive youth employment act in the United States Congress, and in February he used a great deal of information on Canadian programs as supportive evidence.
Well, Mr. Speaker, if the United States are going to rely on Canadian programs to cure their unemployment, their approach will certainly need to be changed. The Minister of Manpower and Immigration included with this letter a copy of the Congressional Record containing extracts from a speech by Senator Humphrey under the heading "How Canada attacks the youth unemployment problem." Well, Mr. Speaker, the minister and his colleagues may be attacking it, but they are certainly not knocking it down.
With regard to youth unemployment, the time has come for the government to place a special emphasis on the whole problem presented by young people who are unemployed.

March 31, 1977
Employment and Immigration
Young Canadians are the people hardest hit by the heartless economic policies of the Liberal regime.
How long can this country sustain a jobless rate among the young that in some areas amounts to 25 per cent or even more? Unemployment at any age is never pleasant but most people with a few years' experience have acquired some saleable skills. The perennial complaint is, and a legitimate one at that, employers want people with experience-but how can young people get it without finding that first job?
Young Canadians are caught in a long range pattern of diminishing career-orientated jobs. At the same time automation is slowly but surely eliminating employment.
In the 1960's governments told young people to stay in school and they would get jobs. They didn't! Now they are telling them to learn skills and they will get a good job. Another piece of Liberal propaganda.
Many young people who are employed are disenchanted and apathetic about their work. A negative attitude toward youth on the part of employers and older workers is one of the main reasons. Youthful disenchantment toward jobs can be traced to breakdown between expectation and reality.
Studies have indicated that young unemployed have tended to stay out of work longer than older people. Such figures are a clear indication that the government is shirking its responsibility to deal with this situation.
I should like to make a few comments on the need for a national apprenticeship system. I suggest the government should seriously consider this proposal. I notice that in today's Ottawa Journal a story appears in which the minister is interviewed. It is headed: "Tough-Talking Bud Cullen Finds Commons Irrelevant". Well, I think most Canadians, as well as members of the opposition, find his department most irrelevant when it comes to locating jobs for young Canadians. He also says that members of the opposition do not come up with many constructive proposals. I might point out to him that I come up with many constructive ideas in my speeches; I do not just stand here making negative speeches time and time again. The party to which I belong has always produced constructive proposals at election time. Indeed, my hon. friends have made a great many constructive speeches.
I intend to suggest that something should be established along the lines of a national apprenticeship system, so I shall certainly be proposing something constructive. Such a plan would provide the young with at least a chance in a working environment. The basic elements would be as follows: a qualifying period with a maximum of two years for those between the ages, say, of 19 and 25; no restriction to be placed on a field of work; pay to be better than UIC benefits, and tax incentives to be offered to participating employers.
I would also be in favour of a national work draft which would, by use of a lottery, absorb at least 10 per cent of the young people entering the job market for the first time. They could be employed in several ways, all of course productive and creative. The draft, by the way, would not be compulsory but rather one people could register with. These are, of course,

only suggestions meant to stimulate discussion, but the fact of the matter remains that thousands of young Canadians are out of work.
The Progressive Conservative party has been taking a serious look at the entire issue of student summer employment. All indications are that this summer will find more students out of work than during any previous summer. The facts also reveal that the dire situation facing students is largely the result of government indifference and the Liberals' lack of priority in this area. The facts are clear. Recent reports from Statistics Canada indicate that Canada has the highest rate of unemployment among young people ever recorded.
This government is breaking every record that it is possible to break in the world. I can give a number of other examples of records being broken, Mr. Speaker. Canada is now running the largest foreign debt in the western world. Our average wages in manufacturing are now the highest in the world, and our exports are dropping. We hold the world's record for hours lost per thousand workers due to labour disputes and strikes, losing five times as many man-days per thousand workers as Britain. Average wages in Canada last year increased by 14 per cent, nearly double the rate in the United States. Since 1972 our labour cost per unit of output has increased more than 50 per cent, compared to only 20 per cent in the United States, and our productivity also suffers in comparison. Our trade deficit on manufacturing last year was $10 billion. Our money supply, a chief cause of inflation, was up 22.8 per cent of the annual rate last month. No wonder we have high unemployment in Canada, Mr. Speaker, with a record like this.
In 1976 findings indicated that because of the general lack of jobs available to students, post-secondary students had to take jobs usually taken by graduating high school students. Therefore, as a result of this development, student unemployment rates increased. An even more alarming indication of the government's inability to grapple with or understand this problem is that Manpower's own participation survey-


Mr. Deputy Speaker:: Order, please. I am sorry to interrupt the hon. member but it being 4.44 o'clock p.m. it is my duty at this time to interrupt the proceedings pursuant to the order made Tuesday, March 29, 1977, and to put forthwith every question necessary to dispose of the second reading of the bill now before the House.
The question is the following one.

Mr. Cullen, seconded by Mr. MacEachen, moved that Bill C-27, to establish the department of employment and immigration, the Canada employment and immigration commission and the Canada employment and immigration advisory council, to amend the Unemployment Insurance Act, 1971, and to amend certain other statutes in consequence thereof, be read the second time and referred to the Standing Committee on Labour, Manpower and Immigration.
Is it the pleasure of the House to adopt the said motion?
March 31, 1977



All those in favour of the motion will please say yea.


Some hon. Members:: Yea.


Mr. Deputy Speaker:: All those opposed will please say nay.


Some hon. Members:: Nay.


Mr. Deputy Speaker:: In my opinion the yeas have it. And more than five members having risen:


Mr. Deputy Speaker:: Call in the members.


Mr. Speaker:: I therefore declare the motion carried.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Labour, Manpower and Immigration.
Mr. Speaker:: It being five o'clock, the House will now proceed to the consideration of private members' business as listed on today's order paper, namely, notices of motions (papers), private bills, public bills.


PRIVATE MEMBERS' MOTIONS FOR PAPERS
Mr. Speaker:: I understand that motions Nos. 1 and 11, both of which stand in the name of the hon. member for Humber-St. George's-St. Barbe (Mr. Marshall), have been under discussion and there is agreement to stand the intervening order and to deal today with notice of motion No. 11.


TRANSFER OF QUEEN MARY HOSPITAL
Jack Marshall: That an humble address be presented to His Excellency praying that he will cause to be laid before this House copies of all correspondence, minutes of meetings, telegrams, contracts and/or agreements between the government and the province of Quebec having to do with the transfer of Queen Mary Hospital in Montreal.
He said: Mr. Speaker, I do not know why everybody is leaving.


Some hon. Members:: Order!

March 31, 1977
Veterans Affairs


Jack Marshall: This is the second notice of motion for the production of papers on the transfer of hospitals that I bring before the House requesting all pertinent material in the negotiations between the federal government and the provincial government concerned in the transfer of the Queen Mary Hospital veterans' wing in the province of Quebec.
My other motion on December 2 1976, had to do with the transfer of Westminster Hospital in London, Ontario. While anything I have to say on the hospital transfer would be repetitive-


The Acting Speaker (Mr. Ethier):: Order, please. 1 ask members of the House to take their seats, please. I do not know whom to recognize as about a dozen members are standing.


Some hon. Members:: Order!


Jack Marshall: Some of us should be put into veterans' hospitals. As I was saying, anything that I might have to say on hospital transfers would be repetitive. The main point I want to make is that it is ridiculous for the government to refuse to produce the papers, which only makes one suspicious of its intentions and of its sincerity. There is absolutely no need to refuse to produce the documents requested because, through some poking around in the department, through questions put to the minister in the House, through various telephone calls, and with the co-operation of departmental officials, I was able to gather together most of the information.
On March 28 I asked the minister about the status of the negotiations with regard to Queen Mary and St. Anne's hospitals. In his reply he said that negotiations are going on with the province of Quebec in accordance with government policy and that there is constant contact with veterans' organizations. He also said in his reply that he can give an assurance that veterans are cared for and that employees are protected.
This is the point of my motion. Why is it that the House of Commons, members of the Standing Committee on Veterans' Affairs, and indeed any member who has a veterans' hospital in his district, are denied the opportunity to perform their duty by offering advice and transmitting the assurance given by the minister to veterans and hospital staffs? All we hear from the minister is that everybody agrees, and yet about two weeks ago the chairman of the Hong Kong Veterans' Association, Mr. Charles Brady, wired the Prime Minister (Mr. Trudeau) and the Minister of Veterans' Affairs (Mr. MacDonald), and sent copies of the wires to all members. I think I should read them into the record. The wire to the Prime Minister refers to his letter of January 17, 1973, regarding hospital transfers. It reads:
-today while at Queen Mary Veterans' Hospital Montreal was advised provincial government will make it a chronic care hospital after transfer. Veterans' rights for bed space will be denied which will be a first in DVA transfers. It is tragic that the government will not honour its federal policy to veterans. Veterans need more care now. We have to find out exactly what is going on. Confirm RSVP.
He also sent a wire to the minister which reads:
Your letter December 22, 1976, re hospital transfers, page 2. Re St. Anne's reads federal policy to guarantee no diminution of level of facilities for use of veterans. Was in touch with Queen Mary hospital today. Was advised provincial government will make it a chronic care hospital. Veterans' rights for bed space will be denied. This will be a first in DVA transfers. It is disturbing that the government will not honour and maintain its federal policy. Confirm details re Queen Mary transfer RSVP.
He also sent another wire which reads:
Today contacted Queen Mary Veterans' Hospital, which can be transferred to provincial government any day now. Was advised it would become a chronic care hospital means loss of jobs. More important this will be the first time in DVA transfers that veterans' rights for bed space will be denied. St. Anne's could follow the same course in 12 months, if we don't do something now. Veterans cannot permit these tragic developments to pass. Time for action is now. Recommend veterans' groups make joint representation before the Standing Committee on Veterans' Affairs and Minister MacDonald ... RSVP Hong Kong Veterans' Association of Canada.
Every time we ask the minister, as I said before, we are told that everything is fine, and yet before a hospital is transferred everyone else but the minister receives letters and telegrams of protest. As I said before, I ask in my motion why we are denied this information which we can receive anyway, to allow everyone here to assure veterans that the care which was promised will be given them? This was the commitment made by the Department of Veterans Affairs for many years.
The minister has made a number of visits to the Royal Jubilee Hospital. He has visited the veterans' pavilion there and heard concerned citizens and veterans' rights organizations express widespread dissatisfaction with regard to veterans, their dependants, and the wives of those who are supposed to be getting proper care in the veterans' pavilion at the Royal Jubilee. I have said many times that no one quarrels with the concept of transferring hospitals to non-departmental agencies due primarily to the trend indicating a need for more extended care rather than acute care, and due to the difficulty in keeping medical staff, for obvious reasons. However, I have also said that when the decision was made by the cabinet in 1963 to transfer veterans' hospitals, there was a lack of projection of the number of beds which should be provided. It has now been proved that we were right.
A report dated November, 1976, was given to me. It is a report by the treatment services division which shows the waiting period in hospitals already transferred to be up to 15 months. It also shows that in a hospital not yet transferred the waiting time is up to 18 months.
This has to do with a hospital which has not yet been transferred, Deer Lodge Hospital in Winnipeg. At Ste. Anne's hospital in the province of Quebec, which will eventually be under negotiation, there is a waiting period of up to 12 months, and the number on the waiting list totals 225. The lack of projection is emphasized by the example at the Royal Jubilee because of an increasing veteran population in Vancouver, which I will discuss later.


Mr. Boulanger:: Mr. Speaker, I rise on a point of order. The hon. member for Humber-St. George's-St. Barbe (Mr. Mar-

March 31, 1977

shall) is giving figures, but I do not know where he gets this information.


Jack Marshall: For the information of the hon. member the figures come from the treatment services division. The assistant deputy minister is Dr. A. F. Jones, and the Figures come from a report on the various hospitals. This is an example of hon. members not knowing what is going on with regard to transfers. Through no fault of his own the chairman of the Standing Committee on Veterans Affairs is not getting this information. It could be received by everybody if this information were tabled. I will give the hon. member the correct information.
Another thing which is obvious is that the Department of Veterans Affairs is committed to ensuring the care of our aged veterans. I admit that the treatment services section and the hospital staffs are completely dedicated to veterans, but this dedication is lost in many cases as a result of transfers to non-departmental agencies. The non-departmental agencies have a different attitude. They are involved with civilian hospitals, if I can use that term, and the dedication is not the same because those agencies do not understand what is required for veterans. They cannot be expected to show the same feeling for veterans, but there is an obligation on the Department of Veterans Affairs to ensure care.
Let us look at what the paper on the hospital transfer program says. I want to quote from one of the paragraphs which indicates the following:
Where the transfer of a hospital from DVA to provincial authority has taken place, DVA reimburses the province for the care of pensionable disability cases, and pays premiums where required on behalf of veterans who are eligible for war veterans allowance. However, the treatment of all veterans (other than those requiring treatment for a pensionable disability) is now taken care of by the provincial hospital service in provincial hospitals; veterans do not receive priority.
An exception was made for the treatment of pensionable disability cases. In a directive on 9 December, 1963, Cabinet affirmed its intention that in any transfer, there should be a guarantee of unconditional priority use of beds for the treatment of veterans with service incurred disabilities, either in the transferred hospital or in some other hospital.
This is not happening, and that has proved to be the case after every transfer. This is shown in the list put out by the treatment services division of the Department of Veterans Affairs, which has all the facts and figures.
The Canadian Legion represents most of the 500,000 veterans of Canada, but there are many other veterans' organizations which are also concerned about hospitals, and they are not included in the consultations which take place. They find out after decisions are made and after mistakes, if any, are made.
At Ste. Anne's Hospital proper care is provided, and the number of beds which is needed is there. The purpose of this motion, past motions, and future motions is to focus attention on the fact that we as members of the Standing Committee on Veterans Affairs or any member of parliament should be able to find out what is going on and to have an input.
The following is what one national veterans' organization had to say:
Veterans Affairs
Veterans across Canada appear to be completely confused regarding the future of veterans' hospitals and the attendant matters of treatment and domiciliary care.
When the government's intention to transfer DVA hospitals to the control of other jurisdictions was announced in 1965, the matter seemed simple enough. Veterans were told that suitable arrangements would be made for treatment for pensioned conditions and that others who were entitled to treatment (e.g. war veterans recipients) would be looked after. A promise was made, as well, that there would be sufficient bed space for domiciliary care.
At that time, DVA officials gave the impression that these transfers would be carried out with despatch and the veteran would know precisely where he stood in regard to availability, to him, of medical facilities. We all know that this just did not happen-
I might add that this does not happen in every case, but it does happen in some.
-and some ten years later veterans in many areas do not know, from day-today, what provisions will be made for their medical treatment.
It is now 12 years later. This organization also had this to
say:
This situation is deplorable-
I would not use that strong a term, but the situation is doubtful.
-the government should clarify its policies regarding the transfer of DVA hospitals. We realize that, in many instances, the terms regarding such transfers are often being dictated by sources not under control of the Canadian government. This may cause undue delay. Notwithstanding, veterans are entitled to know what is happening to the institutions which were originally built for the purpose of providing medical care for them.
In accordance with the original announcement of 1965, veterans were to be consulted in regard to any transfer. The experience has been, in most instances, that the arrangements are in the last stages of completion and then the veterans' organizations are informed. It may be that the commitment to consult the veterans' organizations in advance is one which the government finds difficult to maintain-for the reason that negotiations regarding takeovers must usually be held in confidence. In any event, this hardly contributes to a feeling of security on the part of the veteran regarding treatment facilities.
It is our view that the entire matter of transfer of DVA hospitals should be reviewed by a committee comprised of officials of the Department of Veterans Affairs and the national veterans' organizations.
I would like to add to that the members of the Standing Committee on Veterans Affairs.
The terms of reference of such committee should be:
(1)	To determine what additional DVA hospital facilities should be transferred, if any; and
(2)	To arrive at a reasonable conclusion as to the number of domiciliary
care beds which should be available in each of the DVA districts.
We have reached a conclusion . .. that there is possibly some merit in further transfers.
I go along with that.
This would be clear, however, only if veterans' organizations could be made privy to essential information.
Our main concern is not with active treatment. We are aware that, in most areas, this will be available regardless of whether the treatment is given through a departmental institution or one under jurisdiction of some other agency.
It is the government's obligation to the aging veteran which seems to be the important question. We are aware that domiciliary care is looked upon by the department as a privilege rather than a right-and is dependent upon the availability of bed space. It is for this reason that it is essential that no further transfers be made-

March 31, 1977
Veterans Affairs
And this was the point of a number of motions I moved under Standing Order 43, which were not accepted. I continue quoting:
-unless there are guarantees that sufficient domiciliary care bed space will be retained; and, in fact, it may well be necessary for the government to do some 'back tracking' in certain areas where transfers have been made, and sufficient domiciliary care facilities have not been retained ...
There seems to be an attitude, on the part of some departmental officials, that veterans requiring domiciliary care are, in some respects, a community responsibility. Our organization contests this theory. The federal government has a responsibility to provide domiciliary care for the aging veteran. This is not a matter of right, at the moment, but it should be enshrined in the veterans charter, so that those veterans who prefer to spend their remaining years among their former comrades-in-arms in a good domiciliary care institution which can provide not only minimum medical care, blit also social and recreational amenities, can do so.
That is an important point. I say that many aging veterans, and some have reached the age of 104 I would have you know, want to spend the remaining years of their lives in their own environment. I think Canada owes them this, and I say this without wanting to sound dramatic or overly compassionate.
The helpful attitude which has been the hallmark of the doctors, nurses, and other staff of our better run DVA domiciliary care units in Canada represents something which cannot be found in most private facilities. It exists only in those veterans' institutions and it would be a sad reflection indeed if, because of shortsightedness at this stage, Canada were to fail to make sufficient provision in future for the domiciliary care facilities we know will be needed.
In order to give others an opportunity to speak I will refrain from making further comments but will reaffirm that we agree, for the reasons I have mentioned, with the concept of transfer of hospitals. It is difficult to get medical specialists to look after chronic, extended and domiciliary care cases. But there is that commitment. I think those who are concerned about veterans and have served for a number of years on the Veterans Affairs Committee should be allowed to provide some input. The parliamentary secretary opposite is one of the members of that committee. He is a learned, expert, and compassionate doctor. Nobody wants to oppose what the minister is trying to do. However, judging from the number of requests we have received, there is reason and justification enough for producing the papers requested and acceding to this request, made in the best interests of the veterans of Canada. It ought to be supported by members of this House and all those in Canada who are concerned about veterans.


Mr. S. Victor Railton (Parliamentary Secretary to Minister of Veterans Affairs):: Mr. Speaker, I shall try to answer some of the points made by the hon. member for Humber-St. George's-St. Barbe (Mr. Marshall). The hon. member requests the tabling of all correspondence, minutes of meetings, telegrams, contracts and agreements between the government and the province of Quebec having to do with the transfer of Queen Mary Hospital. Mr. Speaker, the minister cannot do this because our officials are still negotiating agreements with the provincial authorities. No definitive positions of accord

have been reached between the representatives of the provincial government and the Department of Veterans Affairs. There may be a little blue sky on the horizon. There are specific requirements which must be met in a number of important areas, and these requirements are presently under negotiation.
I think that it is misleading to talk about waiting lists. Mr. Speaker, no acutely ill person can wait one year for a hospital bed. Therefore I think the hon. member was referring to someone who needs a domiciliary or chronic care bed. These cases do not necessarily involve veterans who have been wounded or require treatment for their pensionable disability. Actually this question is of concern to the entire veterans' organization. We have at least 900,000 veterans in Canada.
The question has arisen whether the government promised domiciliary care to all veterans. Mr. Speaker, I do not think such a promise was ever made. Hospitals were never really designed to look after domiciliary care veterans. The hospitals we are transferring are excellent, acute treatment hospitals and should not be used for domiciliary care. They should be used by the sick people of the general population, which includes veterans. You may be sure that we shall look after the needs of veterans, but we must also make provision for the employees of hospitals and make sure they do not lose their employment.
That the government recognizes its moral responsibility is very evident. It is supposed to provide the best possible medical care for veterans who have a pensionable disability. Sometimes people do not agree with the way we are going about doing this, but we have a responsibility in this regard. I have met veterans all across Canada and can say, personally, that the great majority of veterans' organizations feel we are doing everything we should to look after veterans properly. Some people, of course, are always dissatisfied, no matter what we do.
It is now more than 30 years since World War II ended. We looked after our veterans awfully well when they returned. There were 40 veterans hospitals; we had to build special hospitals because there were not enough civilian hospitals to look after the men who needed specialized care. Lots of these men were severely wounded. The hospitals were filled with them. I had the opportunity to look after the men shortly after they were wounded, and know all about them. We looked after them devotedly and actively. They were given specialized care by doctors, and were often treated in specialized hospitals as well. However, over the years the number of veterans requiring active and acute care has decreased steadily. As beds became empty, they were made available to war veterans allowance recipients. Then, slowly but surely, the profile of the veteran patient changed.
May I ask how much time we have left, Mr. Speaker?


Steve Eugene Paproski: You can go on until you hear the knock on the door.


The Acting Speaker (Mr. Ethier):: Order, please. There are about 15 minutes left.
March 31, 1977


Samuel Victor Railton: The big question is, how are we to staff these hospitals? On this point I do not agree with the previous speaker. I do not think domiciliary care hospitals can be regarded in the same light as ordinary veterans hospitals which have looked after so many of the ill.
What does all this mean to veterans who will need hospitalization in the future? We hope that it will mean that the veteran will have available to him a range of services which will meet completely his needs at any given time. As a client who is an integral part of a modern community medical and hospital complex, a patient can call on all the resources of that complex.
I think I should defer to other hon. members who wish to speak. I could make a longer speech, to explain the situation, but am certain that other hon. members who wish to speak can do this very well.


Mr. William Knowles (Norfolk-Haldimand):: Mr. Speaker, I rise to participate briefly in this debate. It is going to be brief because of a similar situation which is taking place in London, Ontario, where the transfer of the Westminster Hospital is in the negotiating stage with the province of Ontario. I understand that negotiations there are at a standstill because of some disagreements between the two parties. It would be helpful to all, veterans organizations in particular, if we knew precisely the nature of the difficulties and were provided with detailed information about the transfer terms. Veterans in all areas of Ontariq, particularly western Ontario, would then be in a better position to judge the rightness of the action being taken.
I agree with what has been said by my colleague, the hon. member for Humber-St. George's-St. Barbe (Mr. Marshall), that we are primarily concerned about the chronic and domiciliary care of those patients who are aging and are in acute need of this care. It is all very well to say that the care and special treatment provided in veterans hospitals has been adequate. It certainly has been. No one can find fault with that. However, we are now getting into another phase of care for veterans, that of chronic and domiciliary care. It is not too much to ask the minister and the department to take a good look at the need for providing this care which is perhaps just as great as the treatment care given in earlier years.
The Royal Canadian Legion has gone along with the policy of the department to transfer to other authorities. However, there are now some second thoughts, perhaps not by the Dominion Command but by Legion branches across the country. This is why it is essential that we should be privy to all information regarding the transfer of hospitals.
The Federation of British-Canadian Veterans of Canada requested that the federal government retain parts of Westminster Hospital. They are very specific about it, specifying that part south of Commissioners Road and that part east of Wellington Road. They want it retained as a memorial to those Canadians who have given their lives in defence of their
Veterans Affairs
country in order to provide the care about which I have been talking.
There are rumours that a company is interested in developing housing in the city of London. It is anxious to purchase some of the spacious grounds that surround Westminster, which is the pearl among all treatment hospitals in this country. To have this land used for such a purpose is completely wrong. We should know a little about that aspect of it as well.
Basic to the whole question we are talking about today, we need some guarantee that there will be priority for domiciliary care for our veterans. That has not been properly taken into account when the department has been negotiating. Officials have forecast a certain amount of bed space, but in every case they have fallen short. As a result, we have waiting lists of veterans wanting this type of care. They just cannot get it.
We need more information provided to members of parliament, particularly members of the Standing Committee on Veterans Affairs, in order to be in a better position to judge the correctness of representations now being made by Legion branches across the country which do not go along with the position taken by the Dominion Command.


Mr. Joe Flynn (Kitchener):: Mr. Speaker, I willingly join in this debate on the motion of the hon. member for Humber-St. George's-St. Barbe (Mr. Marshall) to discuss this very important issue. We should actually talk about the condition which presents this issue, the problem of geriatrics, which we are getting into more than anything else. As all of us who belong to veterans organizations know we are a dwindling group. We are suddenly down to 900,000. We are now getting into a lot of problems, most of which evolve around age.
As former speakers have said, the veterans' organization has been well taken are of by the Department of Veterans Affairs and this government.
There are very specific conditions and guarantees written into these contracts. While the details might vary from province to province, the broad over-riding principles remain the same. In each hospital transfer, a specific number of beds must be guaranteed for pensioners for the treatment of their pensioned disabilities.
There must be assurances of adequate hospital accommodation for WVA recipients. At the same time the protection of employment for the existing DVA hospital staff must be negotiated. The veterans' organizations in each province are consulted because their input is very important to the success of the whole operation.
I am sure you can see from the things I have talked about that the government's position on striving for the best hospital care for disabled veterans is an on-going position, a continuing concern. We know that our disability pensioners are getting older, that they need primarily facilities for treatment of a chronic care nature. This is really the geriatric problem. It is a problem that is being very carefully discussed in Health and Welfare.

March 31, 1977
Veterans Affairs
One hon. member correctly asked the Minister of National Health and Welfare (Mr. Lalonde) how we are going to train staff and medical people to look after the geriatric problem? That is really the key to the issue of the transfers of these veterans' hospitals. We know that in the years ahead we will not be able to attract the staff to give them this modern, specialized care in existing veterans' hospitals. Therefore we have to get into the very involved and growing problem of training medical people in particular to look after not only the 55 years old as I am, but the older veterans, some of whom are sitting in this Chamber. There will be a real problem in getting medical staff to look after them, encouraging young doctors to become interested in the geriatric problem.
There are really two problems. Our Department of National Health and Welfare has a problem of providing for care, staff, and maintenance of these older people. It is unthinkable that we should allow these hospitals to deteriorate into second class institutions. We would not want that to happen. We have very carefully tried to avoid any consequence of that nature. We would like them to be suitable not only for the care of the aged but for any current condition that may arise.
All of the factors that went into the equation of establishing special hospitals for veterans have changed. Therefore a new equation must be worked out. We feel that the policy of transferring our hospitals to provincial jurisdiction, integrating them into the total community medical care complex, with built-in safeguards for the veterans who are our responsibility, and for our staff, is the best possible solution to the problem.
Let me take a moment to thank the staff who have worked so diligently over these 32 years. Some of them have been in veterans' hospitals for a long time. We should thank them for carefully ensuring that all those within the hospitals are mentally prepared for this transfer and are able to cope with it. Our staffs have always been careful to ensure that the patients know full well what is expected of them. This really comes up in the total community of health networks which I spoke about before, with the equation for establishing special hospitals having changed.
We feel the policy of transferring veterans' hospitals to provincial jurisdiction is completely justified. Let me elaborate on this, if I may. Veterans now have the option of going to the hospital of their choice and to the doctor of their choice. A veteran who needs medical attention no longer has to travel 50 miles from home to be looked after in a veterans' hospital. Now we have a policy under which veterans can go to their own family doctors, which makes it a lot easier for those who are not located near veterans' hospitals. Or, if he is not satisfied with his doctor, a veteran can choose another. He has the full range of modern laboratory facilities and specialized equipment at his command.
I am sure hon. members appreciate that the transfer of these hospitals is in no sense an abrogation of responsibility on the part of the government. Quite the reverse is true. The right of disabled veterans to the best hospital and medical care avail-

able is the principle on which all these agreements are negotiated. Every agreement provides that a guaranteed number of priority beds should be available for pensioned veterans; every agreement assures that the hospitalization needs of those veterans who are entitled to them are fully provided for. Every agreement assures that priority beds are provided for in hospitals approved by the department.
In addition, the rights of employees at the time of transfer are safeguarded. I suggest that a policy of transferring veterans' hospitals to provincial jurisdiction, integrating federal health care into a total community health context, is a responsible and progressive step forward. We owe a great debt of gratitude to the staff for facilitating the transfer to provincial authority. They are in a position to appreciate the ramifications of this policy. They will ensure the continuity of health care and services in this field. The Department of Veterans Affairs provides medical, dental and auxiliary care-


Mr. Speaker:: Order.



THE ROYAL ASSENT

[Stage Direction]
The Sergeant at Arms having acquainted Mr. Speaker that a message was to be delivered from the Deputy Governor General:
Mr. Speaker:: Admit the messenger!


Stanley Howard Knowles: No!


Some hon. Members:: Oh!
A message was delivered by the Gentleman Usher of the Black Rod as follows:
Mr. Speaker, the Honourable the Deputy Governor General desires the immediate attendance of this honourable House in the chamber of the honourable the Senate.
Accordingly, Mr. Speaker with the House went up to the Senate chamber.

And being returned:
Mr. Speaker informed the House that the Deputy Governor General had been pleased to give, in Her Majesty's name, the Royal Assent to the following bill:
Bill C-37, an Act to provide for the making of certain fiscal payments and of established programs financing contributions to provinces, to provide for payments in respect of certain provincial taxes and fees, and to make consequential and related amendments.-Chapter 10.

The hour provided for the consideration of private members' business has now expired. I do now leave the chair until eight o'clock p.m., at which time, may I remind hon. members, that the House will consider a ways and means motion moved by the Minister of Finance.
At six o'clock the House took recess.
March 31, 1977



COMMONS DEBATES AFTER RECESS

[Stage Direction]
The House resumed at 8 p.m.


Donald Stovel Macdonald: That this House approves in general the budgetary policy of the government.
He said: Mr. Speaker, over the past 18 months the government has directed much of its effort in economic policy to countering inflation. Canada has come a long way on the road to recovery from that inflation which first engulfed us in 1973. The rise of costs and prices disrupted many aspects of our economic life, and continues to do so. We must persist with our efforts to control it. The next section of the road back is beset with a number of hazards. The essential policy of this budget is to set forth a fiscal program to help guide the economy through these hazards.
One of the worst effects of inflation from which we continue to suffer is high unemployment. There never was any doubt that inflation would bring this result in its train. Our concern that inflation would produce worsening unemployment was a principal reason why the government embarked upon its strong anti-inflation policy.
Nor was there any doubt that the after-effects of inflation would be prolonged. We must not forget that fact now. Apart from all its adverse social results, inflation weakens the ability of our producers to compete at home and abroad. It also erodes the confidence so essential to the conduct of business and to investment in business capital. Without the restoration of confidence we will not generate the jobs we need. The task is the more difficult because our unemployment has been worsened by the failure of other economies to recover as rapidly as we had hoped.
One hazard of all this is that we will over-react and administer a shock of stimulus that is too strong to be absorbed without regenerating inflationary forces. What is required is stimulus of a degree that can be safely absorbed.
Another hazard is that we will succumb to the temptation to become more protectionist in the face of our impaired competitive position.That would surely be the wrong policy for a people so heavily dependent upon foreign trade. We are prepared to act, and have done so, in particular cases where domestic producers face serious injury. Such emergency action is consistent with our international commitments. But the government is convinced that the right policy over the longer term is to regain our competitive position by ensuring that our inflation is brought under control and to seek removal of barriers against our exports.
The Budget-Hon. Donald S. Macdonald
The decline in the value of the Canadian dollar that has occurred can be of benefit to our exporters and to those who compete with imports in our domestic markets. It is of crucial importance, however, that we do not erode this advantage by a resurgence of income increases that add to our costs. If we avoid that and press on to improve our relative cost position, then we shall benefit in our general standard of living from the freer world trading environment it is our policy to seek.
A third hazard is that the renewed price pressures coming from particular quarters will weaken our collective resolve to maintain the anti-inflation fight. Rates of increase of food prices declined sharply from mid-1975 to the end of 1976. But a combination of developments in the world has induced a new rise in food prices which is likely to continue for some time. World energy prices also continue to rise. We cannot shield ourselves from this hard fact. Canadians, like everyone else in the world, will have to accept still higher energy prices. In addition, the decline in the external value of the Canadian dollar is increasing the cost of our imports and pushing up domestic prices.
What is required is that we accept the inevitable impacts of these price increases upon our living standards, turn to substitutes where we can and reduce our demands for the higher-priced goods to the extent possible. Above all, we must avoid a renewed, self-defeating scramble for higher money incomes.
The prices and incomes program has served us well. We must continue to support it as long as necessary. We must press on with our consultations as to how responsibility can best be exercised in the determination of prices and incomes in the post-control period.
In developing a budget under these circumstances, two important constraints have had to be observed. The restraint of growth in the government's spending has been an integral part of our anti-inflation policies. The government believes such restraint is as important today as it was at the beginning of the program. By the control of existing expenditures, we are providing room for increases in spending that are most appropriate in the present circumstances. High priority has been attached to spending of the kind that will provide jobs for people.
The second constraint is the limit upon our ability to reduce taxes that is imposed by the need to restrict our demands upon the capital markets. The excess of our outlays over our receipts has to be financed. If it is financed by monetary expansion beyond that which is prudent, it defeats our purpose in containing inflation. If such an excess of outlays results in higher interest costs, the stimulus that we can impart to the economy is offset. Within this constraint we have found it possible to provide for further tax reductions in this budget.


THE ECONOMIC SETTING
[Stage Direction]
Mr. Speaker, over the past four years, all the major economies of the industrial world have been confronted with infla-
[Stage Direction]
March 31, 1977
The Budget-Hon. Donald S. Macdonald tion, recession and massive changes in international payments. Collectively they have made some progress in dealing with these difficult and stubborn problems. But persistent efforts will be needed over a long period of time.
In Canada, as I have said, the underlying momentum of inflation is slowing. With wage settlements coming down in line with the anti-inflation program, our unit labour costs- they key to our competitive position as a trading nation-are being brought under better control. At the same time, the real income of working Canadians has risen strongly.
Output in Canada grew rapidly early in 1976, but then the pace slackened here as elsewhere in the industrial world. As a result the number of new jobs created-209,000-was less than anticipated.
The most disturbing element in our performance has been the recent increase in unemployment. I am particularly troubled by the unemployment among the young people of this country. While the rate among adult men has remained well below 5 per cent, and is 7 per cent among adult women, it is above 14 per cent for young people. Moreover, the burden of unemployment has fallen much more heavily in the Atlantic Provinces and Quebec than elsewhere. The unemployment situation clearly requires not only some general measures of economic stimulus, but also specific initiatives directed at these structural problems.
[Stage Direction]
Slack demand in 1976 led to a significant fall in profit margins. Many firms faced inadequate liquidity and rising debt-equity ratios. The low level of share prices made it difficult to raise additional funds in this form. All these factors contributed to the problem of financing the rapidly increasing costs of new investment projects.
Economic growth in 1976 was led by consumer demand and housing construction while government expenditure on goods and services grew more slowly. Real business investment actually declined despite strength in the energy field. We need renewed growth of business investment and a continuing improvement in exports to create jobs and lay the basis for sustained growth in the future.
The deficit in our balance of payments has increased in recent years, partly as a result of the deeper recession in other countries, partly from our rising bill for interest, dividends_and foreign travel, and from our shrinking energy surplus. But it is also the result of the difficulties our own inflation has created for Canadian producers in competing at home and abroad.
The recent decline in the Canadian dollar reflects lower interest rates in Canada, but it also reflects a sense of uncertainty about Canada's future among foreign investors. The decline will help to offset the higher costs incurred by Canadian firms. It will provide them with new opportunities to compete. These benefits are ours to seize, but only if we keep our domestic costs and prices firmly in check. The immediate impact of a lower dollar is to increase the prices of goods and services to Canadian consumers. If this leads Canadians to demand higher money incomes, the opportunity for a lasting

improvement will be lost. Further depreciation would then be needed to offset still higher costs. We must avoid this downward spiral.

[Stage Direction]
Our goals are clear.
Our first objective must be to maintain the underlying trend to lower inflation.
Our second objective must be to encourage a steady and non-inflationary growth in the economy, in order to provide jobs and reduce unemployment.
I want to emphasize that the federal government recognizes and accepts its responsibility for action to help achieve these goals. But responsibility for the economy rests on others as well. Both political and economic power are widely dispersed in this country, reflecting Canada's diversities and protecting our fundamental liberties. All those who share power also share the responsibility that goes with it for the attainment of our economic goals.
This is well illustrated in the recent record of economic and fiscal cooperation between the federal and provincial governments. That record provides reassuring evidence of the continuity and flexibility of our Confederation while contributing directly to the solution of our economic problems.
Responsibility also rests with our business leaders. It is private firms which employ most of our workers, make most of the investment decisions in our economy, and develop the markets and the new technologies that enhance our standard of living.
An important responsibility also rests with the leadership of the labour movement at every level in this country, for jobs are at stake. Indeed, all Canadians share the responsibility for setting prices, wages and other incomes so as not to impair our opportunities for employment.
We set out in the discussion paper entitled The Way Ahead our views on how responsibility will have to be shared in the post-control society. We will realize the full economic potential of this country only if we develop a greater understanding of what we can realistically hope to achieve.
Mr. Speaker, I want to refer to five areas of public policy at this time, before I outline the specific measures proposed in this budget.

[Stage Direction]
First, Mr. Speaker, energy. We no longer have ready and assured access to cheap energy supplies at home or abroad. In these new circumstances our objectives must be to increase our domestic supplies and to cut our energy demands. Restraint on the price of domestic oil and subsidies on imported oil can provide only temporary assistance to consumers, to provide time to adjust to the new realities. This spring, we will have to set the amount of the next price increase. Our challenge will
March 31, 1977
[Stage Direction]
be to achieve a balance between longer-term energy objectives and the capacity of the economy to absorb further price increases at a time when we are facing unemployment, inflation, and severe international competition.
We will press on with our policy of developing energy supplies. But we must all develop better conservation practices. Canadians must face up to the prospect of higher prices. While it would be unwise to pay more than others do for oil and gas, it would be imprudent to expect that for long we can pay less. The best way for Canadian consumers to protect themselves against higher energy prices is to use less energy.

[Stage Direction]
A second major policy area concerns the controls over prices and incomes. They have helped to bring down the rate of inflation, but their job is not yet done.
If controls were suddenly removed now, there is a danger that rates of cost and price increase would begin to escalate again. This would put in jeopardy the sustainable growth of output and employment. The federal government is not prepared to let that happen.
Mandatory controls over prices and incomes, however, cannot become a permanent feature of the economic life of this country. We need to create the conditions in which controls can be phased out without interrupting progress towards our economic goals.
We have advanced a number of options for decontrol and they have been widely discussed. The government believes that the best approach would be the phased approach based upon the timing of pay agreements and fiscal years. This is generally favoured by the provincial governments. It will be described in full in a discussion paper to be issued in the near future. The paper will also make proposals for a post-control monitoring agency, and suggest structural improvements in the economy. Included here will be a discussion of labour-management relations and public sector compensation policy. The paper will outline proposals for consultation between the government and the provinces, and business, labour and other interest groups. The objective will be to reach the broadest possible understanding of action needed to keep inflation coming down during the process of decontrol and in the post-control period.
Within this framework, there will be a particular need to consider a possible date for beginning the decontrol process. On the basis of all the factors at work, the government believes that a starting date prior to the second anniversary of the program on October 14, 1977 would not be feasible or desirable. A recent initiative on the part of business and labour groups, however, has raised the prospect of sufficient support emerging for a program of voluntary restraint as to warrant consideration of a somewhat earlier date. That could affect the question of timing. This prospect will be fully explored in the further round of consultations intended to follow the publication of the discussion paper. In the meantime, I advise all parties to proceed with wage and price determination in the
The Budget-Hon. Donald S. Macdonald expectation that controls will continue in effect for some time unless replaced by firm understandings which produce similar results. There is no room for any expectation that a time is coming when inflationary claims upon the national income can once again be made.

[Stage Direction]
A third important policy area is job creation.
We have given high priority to direct job creation programs, especially for young people and in regions of highest unemployment.
The employment strategy featuring the major new programs of Canada Works and Young Canada Works has already been launched. Their impact will build up rapidly through the summer and into next winter. We have had a good response from the first call for proposals from public and private groups. This means that jobs will be created quickly. I wish to announce a $100 million expansion of our job-creating programs to boost employment further, where it is most needed. This expanded $458 million commitment for 1977-78 will create 600,000 man-months of employment. It will have significant impact in reducing the number of unemployed. My colleague, the Minister of Manpower and Immigration (Mr. Cullen), will be announcing details in the budget debate.

[Stage Direction]
The fourth policy area is the goverment's continuing program of expenditure control.
We are now seeing the solid results of our commitment two years ago to get government expenditure growth below the growth rate of GNP. Our expenditures for the fiscal year just concluding are estimated at some $750 million less than the forecast contained in the budget of last May.
Our target for outlays in 1977-78 is $44,450 million, or $650 million less than the expenditure plan announced last month by the President of the Treasury Board. Part of this $650 million saving is a reduction in the reserves for Supplementary Estimates to make room for the tax reductions I am announcing tonight. Part is due to general success of the restraint policy, which is bearing down on every department of government.
On a fully comparable basis, expenditures in 1977-78 will be about 9.8 per cent higher than in the year just ending. That rate is lower than the expected growth of GNP and lower than the 11 per cent increase predicted in the last budget. This means, of course, that many useful and desirable programs are having to be delayed or curtailed.

[Stage Direction]
Finally, Mr. Speaker, a fifth broad area of government action is monetary and fiscal policy.
[Stage Direction]
March 31, 1977
The Budget-Hon. Donald S. Macdonald
The essential task of both monetary and fiscal policy in present circumstances is to encourage a growth of demand consistent with the expansion of employment and the winding down of inflation. In the case of monetary policy, it is the strategy of the Bank of Canada progressively to moderate the growth of the money supply. While the overall fiscal strategy has not been formulated in terms of a numerical guideline, here too the advantages of avoiding wide swings in the stance of policy are recognized. For some time, our policy has entailed a sizeable deficit. As the slack in the economy is taken up, the deficit will be reduced. However, to attempt to cut deficits too soon would threaten the recovery. Indeed, with present levels of unemployment, further stimulus is required.
In considering the extent of this further stimulus I have kept in mind the interrelated objectives we have set for ourselves. We cannot pursue rapid growth at the expense of more inflation and a worse balance of payments situation.
I have also been anxious to avoid placing too much pressure on the capital markets. This is to be avoided when we are seeking to encourage new private investment, and when other borrowers may be looking to the domestic capital market for an increasing portion of their financing needs.
In considering the type of fiscal stimulus to be provided, my starting point has been the commitment to expenditure restraint. Within this restraint we have been able to allocate further resources to creation of new jobs. Beyond that, we have turned to the reduction of taxes.

[Stage Direction]
The measures proposed in this budget will create employment, encourage investment and foster regional growth. They will improve the equity market and improve the cash flow of business as sources of funds for expansion. They will give more help to small business and venture enterprises. They will help sustain consumer spending and provide further tax relief, particularly to Canadians with modest incomes. All of these measures will lead to more jobs.

[Stage Direction]
I wish to announce a series of measures with respect to capital investment and regional growth.
Since 1975 the 5 per cent investment tax credit has proved to be an important incentive supporting our manufacturing and resource industries. I propose that the credit, due to expire June 30, be extended for an additional three years. Also the credit will be expanded in two important ways.
First, recognizing the importance of maintaining a vigorous research effort in Canada, I propose that capital and operating expenditures on scientific research and development be eligible for the credit.
Second, the credit will be increased in slower-growth regions designated under the Regional Development Incentives Act. In
£Mr. Macdonald (Rosedale).]
Saskatchewan, Manitoba, Northern Ontario and all designated regions in Quebec other than the Gaspe the rate of the credit will be raised to 7 Vi per cent. In the Atlantic Provinces and the Gaspe region the rate will be raised to 10 per cent.
In addition, the budget contains tax incentives directed toward increased exploration for oil and gas in frontier areas and toward improvements in rail transport facilities, particularly for the movement of grain and coal in Western Canada.

[Stage Direction]
I am proposing further action to assist the financing of business investment. One of my particular concerns is the financing of investment through new equity issues. The market for such issues has not been very receptive in recent years. Moreover the equity base of many corporations has been reduced to a level which does not permit the further borrowing needed for business expansion.
I would like to propose therefore a major increase in the dividend tax credit. Starting January 1, 1978, dividends received from taxable Canadian corporations will be grossed-up by one half, as opposed to one third currently, and taxpayers will be allowed to claim against their tax a credit equal to this higher amount.
This will provide benefits in a progressive manner and make it more attractive for investors in all income brackets to participate in the equity market.
The increase in the dividend tax credit, and the maturing of the capital gains tax introduced in 1972, make it possible to abandon many of the complex rules designed to prevent surplus stripping, that is, the avoidance of tax on tjie distribution of corporate surplus. The present rules very often hamper constructive business reorganization and expansion. The rules will be eliminated or greatly simplified. Efficiency of business operation should be improved through the removal of artificial impediments to decision-making. It will be particularly beneficial to small business.
Other measures designed to improve the equity and financial markets will double the amount of capital losses which a taxpayer can set off against other income, and include capital gains in the present $1,000 exemption for interest and dividends. As well, stock dividends received from publicly listed corporations will not be taxed until disposed of, and then only at capital gains rates. Finally, the exemption from non-resident withholding tax for interest on government and long-term corporate bonds will be extended to the end of 1982.
Many concerns have been expressed about the effects of inflation in distorting the measurement of income reported on financial statements. We are co-operating with a number of groups in a search for a comprehensive inflation accounting system. Consideration of any comprehensive tax measures in this area should await the results of this work. However, the liquidity problems facing business are urgent and require an immediate response.
March 31, 1977
[Stage Direction]
I am proposing at this time a deduction in calculating business income each year of 3 per cent of the opening value of qualifying inventories. The adjustment will be allowed for fiscal periods which commence after December 31, 1976, and will be available to both incorporated and unincorporated business.
This measure will provide tax relief of $300 million a year and enhance the flow of internally generated funds available for business expansion. It will be simple to use and require no fundamental change in accounting practices.
[ Translation]

[Stage Direction]
Mr. Speaker, the government attaches great importance to the contribution small business makes to the Canadian economy. The venture capital review I announced in the last budget was devoted in part to the search for solutions to the financing problems of small business. This analysis revealed that no single tax measure could resolve them. Indeed, many of the problems of the small businessman are a part of the larger problem to which the measures announced earlier are directed. Substantial benefits will flow to small business from the proposals for the extension and increase of the investment tax credit, the increase in the dividend tax credit, the inventory adjustment and the other measures directed towards investment. But we can do more.
A particular problem for small business is the difficulty of matching higher salaries offered by larger enterprises. I propose to introduce a special tax treatment for stock option plans established for employees of Canadian-controlled private companies. The difference between the option price paid for the shares and their sale proceeds will be taxed as a capital gain and then only when the shares are disposed of. This will permit a company to reimburse its employees in a way that does not impair its working capital.
A serious impediment to venture capital investment is tax uncertainty. Certain investors face the possibility that their gains will be taxed fully as ordinary income rather than as a capital gain. Provision will be made for ordinary taxpayers to protect themselves from this risk.
A question which has been much discussed in past budget debates has been the handling of capital gains, particularly with respect to farm and small business properties.
When a commercial business is sold in the course of a move from the centre of a city, or when a farmer sells his farm and buys another, any capital gain is now subject to tax, even if the funds received are used to purchase similar assets in the same business. Tax will be deferred on any capital gain that arises from such voluntary sales after tonight to the extent that the proceeds are reinvested in similar assets.
Other measures of interest to the small businessman will include a relaxation of rules dealing with taxation of intercor-
The Budget-Hon. Donald S. Macdonald porate dividends, and measures relating to conversion to the metric system.

[Stage Direction]
Turning to personal income taxes, a series of steps in recent months has improved the disposable income of Canadians. These have included the reduction in personal income taxes as a result of indexation and the reduction of unemployment insurance contribution rates, I believe we need further action to sustain personal expenditure and to provide some relief to Canadians who are particularly affected by higher prices of necessities.

[Stage Direction]
First, I propose to enrich the existing credit against federal tax. The rate of the credit was recently changed from 8 per cent to 9 per cent as a result of the new fiscal arrangements with the provinces. The maximum credit is $500 per taxpayer and the minimum of $200 ensures that the greater benefit from the credit goes to taxpayers of modest incomes.
For the 1977 and subsequent tax years, taxpayers will be allowed to claim an additional credit of up to $50 for each dependent child under 18 years of age resident in Canada.
For example, a taxpayer with two children, whose current tax credit is $350, will be able to claim a full additional credit of $100. The limit of $500 will continue to apply, so that most of the benefit will be reserved for taxpayers with larger families and modest incomes. This measure is estimated to save taxpayers $275 million for the 1977 taxation year.
[ Translation]

[Stage Direction]
A further major income tax reduction will benefit millions of working Canadians. The employment expense allowance is now established at 3 per cent of wage and salary income with a maximum deduction of $150. The limit will be increased to $250 effective for 1977 and subsequent years. This measure is estimated to reduce federal taxes by $ 115 million this year.
The combined effect of these two measures will be to eliminate completely the federal tax on married taxpayers with two children and earnings of less than $7,360. The comparable income level for a family with four children is $8,295.
These measures will make a tangible contribution to the personal disposable incomes of many Canadians.
[Stage Direction]
RHOSPs
More than 400,000 Canadians have established Registered Home Ownership Savings Plans. These plans help taxpayers accumulate savings for the purchase of a home. However, the rules have been criticized for allowing families to contribute to a RHOSP as it is commonly called, even though they currently own a home or have no intention of acquiring one. I propose
[Stage Direction]
March 31, 1977
The Budget-Hon. Donald S. Macdonald changes to prevent misuse of the plan. A taxpayer will not be permitted to make a contribution to a RHOSP if the spouse with whom the taxpayer is living already owns a home. Home furnishings will be excluded after this year from property eligible for RHOSP funds. Several relieving changes will be introduced to deal with particular problems that taxpayers have experienced with RHOSPs.

[Stage Direction]
A number of other changes deal with structural problems in the income tax and the sales tax. In order to close a loophole in the income tax, there will be a change in the rules relating to Registered Retirement Savings Plans established for a spouse. There will be important changes in the taxation of life insurance companies and policyholders. Also, starting January 1, 1978 the rate of interest applied to refunds and late payments of tax will be increased.
In the sales tax the exemption for small manufacturers will be increased from $3,000 to $10,000. It is also our intention to exempt certain producers of craft products which are of significance to Canadian culture and heritage. Consultation with the crafts industry will be necessary before determining which groups will be exempted. Also, some additional energy conserving items will be exempted.
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.

[Stage Direction]
I come now to tariffs. I am proposing to extend for another year most of the current temporary reductions on a wide range of consumer products. The reductions were first made in 1973 in order to moderate upward pressures on prices and they were scheduled to expire on June 30.
I am also proposing to implement certain tariff concessions for imports from developing countries. These result from discussions held in Geneva during the multilateral trade negotiations. The purpose was to see if something could be done for products of special interest to developing countries in advance of the completion of the negotiations.
I would like to mention two other tariff changes.
First, I propose that the 2'h per cent British Preferential rate be withdrawn on certain machinery and related equipment imported from Britain and Ireland. This action is necessary because of serious difficulties facing Canadian manufacturers. These goods will become subject to the 15 per cent Most-Favoured-Nation rate immediately. Second, I am proposing to restrict the free entry accorded goods imported by Canadians returning from extended periods of residence

abroad. In order to prevent abuse, free entry in future will be limited to articles valued individually at $7,500 or less.
I also intend to ask the Tariff Board to study the coverage of two tariff matters upon which I have received many representations. The first is the item which provides duty-free entry for a wide range of goods imported by or for public hospitals and religious, educational and scientific institutions. The second reference relates to the treatment accorded to hobby equipment, antiques and other collectors' items.
Finally, in principle, I favour allowing recognized ethno-cultural groups to import traditional costumes free of duty. However, we need more time to consider the precise scope of any provision and we will be consulting with interested parties.
Some hon. Members:: Oh, oh!


Donald Stovel Macdonald: As the President of the Privy Council (Mr. MacEachen) points out, if we import kilts, he will be the first person to be consulted on this question.


ECONOMIC AND FISCAL OUTLOOK
[Stage Direction]
Mr. Speaker, I am confident that the measures contained in this budget will help to quicken the pace of our economic recovery. Consumer spending will be sustained and investment stimulated. With renewed growth in the economies of our trading partners, we can expect a further improvement in our trade balance and a reduction in our current account deficit. Output in Canada will begin to rise again at the annual rate of 5 per cent or more needed to bring down the rate of unemployment. Given the time lags involved, this may not happen at once, but the rate of growth is expected to pick up during the course of the year.
For 1977 as a whole, the gross national product is likely to be about 4 per cent or more higher in volume and 11 per cent higher in value than in 1976. Employment is expected to be about 150,000 higher on average this year than last, but the increase between late 1976 and late 1977 could be as high as
250,000	jobs.
The proposals in this budget will reduce the federal taxes of Canadian individuals and corporations by $1.17 billion in the fiscal year 1977-78. This comes on top of the reduction of $900 million in federal personal income tax resulting from indexation and the quarter of a billion reduction in unemployment insurance premiums.
I now estimate that our financial requirements excluding foreign exchange will amount to $5.4 billion in 1976-77. They are forecast to increase to $6.4 billion in 1977-78. The deficit on the National Accounts basis is expected to rise from $4.5 billion to $5.7 billion.
Mr. Speaker, I would like to table the usual supplementary tables on the government's accounts and ask that they be appended to today's Hansard.
Mr. Speaker:: Is this agreed?
March 31, 1977


Some hon. Members:: Agreed.


Mr. Speaker:: It is so ordered.
[Editor's Note: For tables referred to above see Appendix A.]


Donald Stovel Macdonald: I would also like to table the Ways and Means Motions, which set out all of the statutory changes in taxes and tariffs I am proposing, and ask that they be appended to Votes and Proceedings.


Mr. Speaker:: Is this agreed?


Some hon. Members:: Agreed.


Mr. Speaker:: It is so ordered.
[Editor's Note: For notices of ways and means motions, see today's Votes and Proceedings.]


Donald Stovel Macdonald: Further information on some of the proposed changes in the income tax, the sales tax and the Customs Tariff is provided in the supplementary information. I am also making available a document which contains an elaboration of the analysis and policies of the budget.


CONCLUSION
[Stage Direction]
To sum up. We in Canada are not alone in struggling with the difficult task of bringing down the rate of inflation, restoring high levels of output and employment, and improving our balance of payments. From an international perspective, the performance of the Canadian economy, though far from satisfactory, has remained among the top three or four of the world's industrial nations. The incomes of Canadians have continued to grow, in real terms, faster than almost any other country. The program launched in October, 1975, is succeeding in bringing down the rate of inflation and checking the erosion of our competitive position. But recovery from the excesses of inflation is unavoidably slow, because the damage wrought continues to emerge well after inflation has begun to recede.
We have been fortunate that the majority of Canadians, deeply worried by inflation, have supported and co-operated with the government in its general anti-inflation policies. The controls program in particular has continued to command their support, despite the objections raised against it. But the months ahead will be a severe test, as unavoidable increases in prices of food and energy and the impacts of the decline in the exchange rate make themselves felt. These impacts cannot help but slow the gains in average real incomes. It will be crucially important for us all to accept this hard reality, continue to moderate our income demands, and persevere in the effort to beat inflation.
At the same time the pause in the economic recovery and the rise in unemployment has posed a severe problem. Clearly the economy needs stimulus. The budget seeks to provide it in the form and in the degree that will do the most good. Measures are proposed to increase the total demand for goods
The Budget-Mr. Stevens
and services, expand direct job creation, encourage investment and risk-taking on a national basis, and strengthen regional growth.
We have arrived at a stage in the evolution of our program when the temptation to seek quick and easy solutions will be great. We will be urged to spend our way out of our problems, to provide even greater stimulus, to provide protection against the realities of international competition and to withdraw controls before their job is done. These temptations must be resisted if we are to restore the confidence of Canadians and others in the future of our economy and achieve our economic and social goals.
Some hon. Members:: Hear, hear!


Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, the Minister of Finance (Mr. Macdonald) has spoken and we have this shocking document before us. Before the Minister of Finance spoke, the Prime Minister (Mr. Trudeau) spoke. Ten days ago the Prime Minister told some startled university students that if they were dissatisfied with job opportunities in Canada they should go to another country.


Some hon. Members:: Shame!


Sinclair McKnight Stevens: Clearly the Minister of Finance got the message, judging from his budget tonight. The budget in effect proposes one million unemployed in Canada this year and next year.


Some hon. Members:: Shame!


Sinclair McKnight Stevens: This Minister of Finance apparently has given up full employment budgeting and has substituted one million unemployed budgeting in its place. To those Canadians who say they do not like that kind of budgeting, to use the Prime Minister's words, find another country.
The budget says 150,000 jobs will be created this year, but the labour force is going to go up by 225,000. There will be
225.000	more people looking for work this year. Clearly the budget anticipates 75,000 more people being added to the
932.000	people now out of work.


Some hon. Members:: Shame!


Sinclair McKnight Stevens: In last year's budget the administration said it was relying on foreign countries, the United States in particular, to provide our growth. This year the administration is going one better. Not only are they relying on friendly countries to provide our growth but the Prime Minister suggests that those same friendly neighbours should provide homes for our jobless. It would appear that the administration is virtually giving up.
At one time we were told by the government that growth was slow here because it was slow in other countries. Now it is suggested we should go to those same other countries to seek out jobs. What a pathetic attitude. Given the privilege of governing the people, this administration tells the people to go

March 31, 1977
The Budget-Mr. Stevens
to other countries to get work. It is incapable of providing an economic climate which would ensure jobs for our people, and the budget will do nothing of a meaningful nature to rectify this situation.
In that respect they talk of creating 600,000 man months of work. I wonder why they did not figure it out: how many man minutes of work would that be? Let us not be too confused. In effect they have said they feel the job creation program might produce 50,000 jobs this year. Confidence has been shattered by the Prime Minister's musings in the past. It has been shattered by a cabinet which does not have the intent, the will, or the knowledge necessary to restore a vital economy. They, the supposed servants of the people, have one answer to those who are unemployed: if you don't like it, get out of the country. To be more explicit, as the Prime Minister told an audience in Toronto, "My heart does not bleed for you." That is great news for the unemployed fishermen in the maritimes or on the Pacific coast, or for the miner looking for work in northern Canada. It is a brilliant solution for the 32,000 university graduates who cannot find work, or for the 200 lawyers who recently graduated in Ontario and have no jobs.


Some hon. Members:: Oh, oh!


Sinclair McKnight Stevens: In our five eastern provinces, which are burdened with 45 per cent of our unemployment and where 80 per cent of the increase in unemployment has occurred in the last year, imagine how the jobless feel when they hear about this budget. Imagine the audacity of the Prime Minister, who holds himself out as the person best qualified to unite this country.
There is little in the budget for those who are looking for reasonably priced housing. There is virtually nothing in it to promote conservation. Granted, the minister is allowing wood stoves to be exempted from sales tax. But no effort has been made to remove double taxation of oil and gas producers. They are still expected to pay income tax on income not received but paid as royalties to provinces.
That is not all. Where are the meaningful tax cuts for the average family? Where is there recognition that under this government the tax load upon Canadian families has increased from 12.9 per cent to 18.6 per cent of their total income? Where is there recognition of the fact that Canadians, for the first time in history, now pay more in personal income tax than on any other item-more than they spend on housing or on food, and seven times more than they pay for medical care?


An hon. Member:: Because we are paying for that!


Sinclair McKnight Stevens: In the budget we have before us, the take of the government in Ottawa from individual taxpayers goes up by another 16 per cent if it is expressed on a basis consistent with last year.
Then there is the question of inflation. We are told the government is following a program of gradualism. Try to put gradualism in the bank. Explain to the housewife, as she watches prices jump month by month, that she should not worry, because gradualism, to use the government's term, is

working. Judging from this budget gradualism will continue, but it is certain prices will rise.
The government gives $650 million to stimulate business. But I can assure you, Mr. Speaker, that other measures in the budget, including the determination of ministers opposite to leave the controls in position, will more than counteract any stimulative effect they feel they may get from the money they are giving to business.
Where is the restraint of which we have heard so much? We recall the Prime Minister's quip that we are all living beyond our means. But who are living more beyond their means than the government? Since 1971 the total take from the GNP by governments in Canada has risen from 38 per cent to 43 per cent, and of that increase 80 per cent is at the federal government level.
The Prime Minister has said we are living too high off the hog. Let me assure him that nobody is living better than he is. He is getting the prize cuts!


Some hon. Members:: Oh!


Sinclair McKnight Stevens: Based on the spending figures in this budget, if the administration had abided by its own spending guidelines in the past two years, federal spending would be less by $1.3 billion. That amounts to more than $100 per taxpayer in Canada. And they have resulted in the administration needing $6.3 billion this year to cover its cash requirements. Mr. Speaker, that $100 is, in effect, the amount of which the government has cheated the average taxpayer by its spending plans this year.
The answer given by the government to those who seek jobs is very simple: leave the country. When asked about inflation, they say it is caused by the weather or by some foreigner. When government restraint is requested, it is clear they prefer to leave that to the provinces. As for tax cuts, they shout: "Who needs them-we are living beyond our means anyway." The government's answer to the loss of export sales is: who cares-who needs to sell abroad if you can borrow abroad?


Some hon. Members:: Oh, oh!


Sinclair McKnight Stevens: And as to business, this government cannot make up their mind whether it is better to continue attacking business or to ignore it. In the meantime they believe there should be controls. In the meantime they are confident more regulation of all of us is necessary, and some day they will squeeze an increase through for those favourite senior civil servants who the Prime Minister feels are underpaid at $66,000 per year and need $70,000. But, Mr. Speaker, more about all this later.
I move, seconded by the hon. member for Halifax (Mr. Stanfield):
That the debate be now adjourned.


Mr. Speaker:: Is it the pleasure of the House to adopt the said motion?
March 31, 1977


Some hon. Members:: Agreed.
On motion of Mr. Stevens the debate was adjourned.


Allan Joseph MacEachen: Mr. Speaker, the House needs immediate relief from the comments made by the hon. member. Accordingly I should like to move:
That this House do now adjourn.
The Budget-Mr. Stevens Motion agreed to.


Mr. Speaker:: Accordingly, this House stands adjourned until tomorrow at 11 o'clock.
On motion of Mr. MacEachen the House adjourned at 9.15 p.m.
4542

March 31, 1977


APPENDIX &quot;A&quot;
[Stage Direction]
Table 1
Government of Canada Summary Statement of Transactions Public Accounts Presentation
	1975-76 Actual	1976-77 Estimate*! [DOT]	1977-78 Forecast**)
		($ millions)	
Budgetary Transactions
[Stage Direction]
Revenues
[Stage Direction]
. . 29,956
[Stage Direction]
32,595
[Stage Direction]
34,740
[Stage Direction]
Expenditures*2)
[Stage Direction]
. . -33,979
[Stage Direction]
-39,200
[Stage Direction]
-41,900
[Stage Direction]
Surplus or Deficit (- )
[Stage Direction]
. . -4,023
[Stage Direction]
-6,605
[Stage Direction]
-7,160
[Stage Direction]
Non-Budgetary Transactions
[Stage Direction]
Loans, Investments and Advances*2!
[Stage Direction]
. . -3,305
[Stage Direction]
-2,200
[Stage Direction]
-2,550
[Stage Direction]
Annuity, Insurance and Pension Accounts
[Stage Direction]
.. 1,021
[Stage Direction]
2,310
[Stage Direction]
1,850
[Stage Direction]
Other Transactions
[Stage Direction]
. . 1,712
[Stage Direction]
1,145
[Stage Direction]
1,460
[Stage Direction]
Net Source or Requirement (-)
[Stage Direction]
.. -572
[Stage Direction]
1,255
[Stage Direction]
760
[Stage Direction]
Financial Requirements
[Stage Direction]
(Excluding Foreign Exchange Transactions)
[Stage Direction]
Foreign Exchange Transactions
[Stage Direction]
Total Financial Requirements
[Stage Direction]
. . -4,595 . . -190 . . -4,785
[Stage Direction]
-5,350 610*3) -4,740
[Stage Direction]
-6,400
[Stage Direction]
*1! Numbers in these columns should be interpreted as mid-points of
[Stage Direction]
ranges of estimates.
[Stage Direction]
No forecast is
[Stage Direction]
made of the cash
[Stage Direction]
requirements of the Exchange Fund Account.
(2)	Total outlays are composed of budgetary expenditures plus loans, investments and advances.
(3)	This figure reflects transactions to the end of February.
Note: Direct market borrowing, of $40 million in 1975-76 and $390 million in 1976-77, by agent corporations, specifically Petro-Canada and the Export Development Corporation, which have been authorized to borrow under their respective statutes, are not included in Government of Canada financial requirements.
March 31, 1977
[Stage Direction]
Table 2
Government of Canada Public Accounts Budgetary Revenues
	1975-76 Actual	1976-77 Estimate*1 >
1977-78 Forecast*1 >
($ millions)
[Stage Direction]
Personal Income Tax
[Stage Direction]
12,709
[Stage Direction]
14,885
[Stage Direction]
15,620
[Stage Direction]
Corporation Income Tax
[Stage Direction]
5,748
[Stage Direction]
5,210
[Stage Direction]
5,760
[Stage Direction]
Non-Resident Tax
[Stage Direction]
481
[Stage Direction]
450
[Stage Direction]
500
[Stage Direction]
Customs Duties
[Stage Direction]
1,887
[Stage Direction]
2,045
[Stage Direction]
2,350
[Stage Direction]
Sales Tax
[Stage Direction]
3,515
[Stage Direction]
3,975
[Stage Direction]
4,440
[Stage Direction]
Other Duties and Taxes
[Stage Direction]
2,753
[Stage Direction]
2,620
[Stage Direction]
2,460
[Stage Direction]
Total Tax Revenues
[Stage Direction]
27,093
[Stage Direction]
29,185
[Stage Direction]
31,130
[Stage Direction]
Non-Tax Revenues
[Stage Direction]
2,863
[Stage Direction]
3,410
[Stage Direction]
3,610
[Stage Direction]
Total Budgetary Revenues
[Stage Direction]
29,956
[Stage Direction]
32,595
[Stage Direction]
34,740
[Stage Direction]
*1 1 Numbers in these columns should be interpreted as mid points of ranges of estimates.
80012-9V2
[Stage Direction]
March 31, 1977
Table 3
Government of Canada Summary, Extended National Accounts Presentation
[Stage Direction]
1975-76
[Stage Direction]
1976-77
[Stage Direction]
1977-78
[Stage Direction]
Actual
[Stage Direction]
Estimate*1)
[Stage Direction]
Forecast*2*
[Stage Direction]
($ millions)
Current Transactions
[Stage Direction]
A. Revenues
[Stage Direction]
32,326
[Stage Direction]
36,185
[Stage Direction]
38,400
[Stage Direction]
B. Expenditures
[Stage Direction]
-36,312
[Stage Direction]
-40,660
[Stage Direction]
-44,100
[Stage Direction]
Surplus or Deficit (-)
[Stage Direction]
-3,986
[Stage Direction]
-4,475
[Stage Direction]
-5,700
[Stage Direction]
Loans and Other Transactions
[Stage Direction]
A. Loans, Investments and Advances
[Stage Direction]
2,836
[Stage Direction]
-2,022
[Stage Direction]
-2,245
[Stage Direction]
B. Cash vs Accruals
[Stage Direction]
2,068
[Stage Direction]
795
[Stage Direction]
1,319
[Stage Direction]
C. Other Transactions
[Stage Direction]
159
[Stage Direction]
352
[Stage Direction]
226
[Stage Direction]
Net Source or Requirement (-)
[Stage Direction]
-609
[Stage Direction]
-875
[Stage Direction]
-700
[Stage Direction]
Total Financial Requirements (Excluding Foreign Exchange Transactions)
[Stage Direction]
-4,595
[Stage Direction]
-5,350
[Stage Direction]
-6,400
[Stage Direction]
Foreign Exchange Transactions
[Stage Direction]
-190
[Stage Direction]
610*3*
[Stage Direction]
Total Financial Requirements
[Stage Direction]
-4,785
[Stage Direction]
-4,740
[Stage Direction]
*1 * Estimates for Current Transactions items in this column are based on the official national accounts statistics, issued by Statistics Canada, for the first three quarters of the fiscal year, and on Department of Finance estimates for the final quarter.
*2* Numbers in this column should be interpreted as mid points of ranges of estimates. No forecast is made of the cash requirements of the Exchange Fund Account.
*3) This figure reflects transactions to the end of February.
[Stage Direction]


March 31, 1977
[Stage Direction]
Table 4
Government of Canada Revenues and Expenditures National Accounts Basis
	1975 76 Actual	1976-77 Estimated >
1977-78 Forecast*2*
		($ millions)	
Revenues
[Stage Direction]
Direct Taxes, Persons
[Stage Direction]
15,974
[Stage Direction]
18,865
[Stage Direction]
19,475
[Stage Direction]
Direct Taxes, Corporations
[Stage Direction]
5,145
[Stage Direction]
5,080
[Stage Direction]
5,600
[Stage Direction]
Direct Taxes, Non-Residents
[Stage Direction]
484
[Stage Direction]
520
[Stage Direction]
575
[Stage Direction]
Indirect Taxes
[Stage Direction]
8,045
[Stage Direction]
8,560
[Stage Direction]
9,190
[Stage Direction]
Other Current Transfers from Persons
[Stage Direction]
7
[Stage Direction]
10
[Stage Direction]
10
[Stage Direction]
Investment Income
[Stage Direction]
2,229
[Stage Direction]
2,650
[Stage Direction]
3,000
[Stage Direction]
Capital Consumption Allowances
[Stage Direction]
442
[Stage Direction]
500
[Stage Direction]
550
[Stage Direction]
Total Revenues
[Stage Direction]
32,326
[Stage Direction]
36,185
[Stage Direction]
38,400
[Stage Direction]
Expenditures
[Stage Direction]
Current Goods and Services
[Stage Direction]
8,841
[Stage Direction]
9,950
[Stage Direction]
11,050
[Stage Direction]
Transfer Payments to Persons
[Stage Direction]
11,011
[Stage Direction]
12,075
[Stage Direction]
13,725
[Stage Direction]
Subsidies
[Stage Direction]
3,013
[Stage Direction]
2,375
[Stage Direction]
2,525
[Stage Direction]
Capital Assistance
[Stage Direction]
287
[Stage Direction]
310
[Stage Direction]
325
[Stage Direction]
Current Transfers to Non-Residents
[Stage Direction]
562
[Stage Direction]
575
[Stage Direction]
625
[Stage Direction]
Interest on the Public Debt
[Stage Direction]
3,725
[Stage Direction]
4,650
[Stage Direction]
5,350
[Stage Direction]
Transfers to Provinces
[Stage Direction]
7,480
[Stage Direction]
9,295
[Stage Direction]
8,900
[Stage Direction]
Transfers to Local Governments
[Stage Direction]
147
[Stage Direction]
180
[Stage Direction]
225
[Stage Direction]
Gross Capital Formation
[Stage Direction]
1,246
[Stage Direction]
1,250
[Stage Direction]
1,375
[Stage Direction]
Total Expenditures
[Stage Direction]
36,312
[Stage Direction]
40,660
[Stage Direction]
44,100
[Stage Direction]
Surplus or Deficit (-)
[Stage Direction]
-3,986
[Stage Direction]
-4,475
[Stage Direction]
-5,700
[Stage Direction]
(1)
[Stage Direction]
Numbers in this column are based on the official national accounts statistics, issued by Statistics Canada, for the first three quarters of the fiscal year, and on Department of Finance estimates for the final quarter.
[Stage Direction]
(2)
[Stage Direction]
Numbers in this column should be interpreted as mid-points of ranges of estimates.
[Stage Direction]
March 31, 1977
Tables
Government of Canada Revenues, Public Accounts and National Accounts Reconciliation
	1975-76 Actual	1976-77 Estimate*1 *	1977-78 ' Forecast*1*
		($ millions)	
Budgetary Revenues - Public Accounts 		. . . 29,956	32,595	34,740
Deduct
[Stage Direction]
Post Office Revenues and Deficit
[Stage Direction]
-913
[Stage Direction]
-1,120
[Stage Direction]
-1,237
[Stage Direction]
Deficit of Government Business Enterprises*2*
[Stage Direction]
. . . . -158
[Stage Direction]
-175
[Stage Direction]
-190
[Stage Direction]
Excess of Accruals over Collections
[Stage Direction]
Corporate Income Tax
[Stage Direction]
-938
[Stage Direction]
-58
[Stage Direction]
-88
[Stage Direction]
Oil Export Charge
[Stage Direction]
... -127
[Stage Direction]
-10
[Stage Direction]
-25
[Stage Direction]
Add
[Stage Direction]
Government Pension and Social Security Receipts*3*
[Stage Direction]
. . . . 4,094
[Stage Direction]
4,887
[Stage Direction]
5,228
[Stage Direction]
Capital Consumption Allowance
[Stage Direction]
. . . . 442
[Stage Direction]
500
[Stage Direction]
550
[Stage Direction]
Miscellaneous Adjustments*4*
[Stage Direction]
-30
[Stage Direction]
-434
[Stage Direction]
-578
[Stage Direction]
Total Revenues - National Accounts
[Stage Direction]
32,326
[Stage Direction]
36,185
[Stage Direction]
38,400
[Stage Direction]
(1)
[Stage Direction]
Numbers in these columns should be interpreted as mid-points of ranges of estimates.
[Stage Direction]
(2)
[Stage Direction]
in the Public Accounts, deficits of government business enterprises are a charge to budgetary expenditures whereas in the National Accounts, these deficits are deducted from remitted profits of other government business enterprises.
[Stage Direction]
(3)
[Stage Direction]
|n the Public Accounts, the government pension and social security receipts and disbursements are treated as non-budgetary transactions whereas in the National Accounts, these transactions are included in government revenue and expenditure.
[Stage Direction]
(4)
[Stage Direction]
These miscellaneous adjustments arise as a result of conceptual differences between the two forms of presentation. These items represent, for example, the proceeds from the sales of existing capital assets; budgetary revenue items offset against budgetary expenditures; imputed items; and, an adjustment for the treatment of revenue in the supplementary period.
[Stage Direction]
March 31, 1977
[Stage Direction]
Table 6
Government of Canada Expenditures, Public Accounts and National Accounts Reconciliation
	1975-76 Actual	1976-77 Estimate*1	1977-78 * Forecast*1*
		($ millions)	
Budgetary Expenditures - Public Accounts 		. * 33,979	39,200	41,900
Deduct
[Stage Direction]
Transfers to Funds and Agencies*2*
[Stage Direction]
. . -1,938
[Stage Direction]
-3,000
[Stage Direction]
-2,850
[Stage Direction]
Post Office Expenditures
[Stage Direction]
. . -913
[Stage Direction]
-1,120
[Stage Direction]
-1,237
[Stage Direction]
Deficit of Government Business Enterprises*3*
[Stage Direction]
.. -158
[Stage Direction]
-175
[Stage Direction]
-190
[Stage Direction]
Add
[Stage Direction]
Expenditures of Funds and Agencies*2*
[Stage Direction]
. . 1,375
[Stage Direction]
1,394
[Stage Direction]
1,537
[Stage Direction]
Government Pension and Social Security Disbursements*4* .
[Stage Direction]
. . 4,036
[Stage Direction]
4,343
[Stage Direction]
4,872
[Stage Direction]
Capital Consumption Allowance
[Stage Direction]
. . 442
[Stage Direction]
500
[Stage Direction]
550
[Stage Direction]
Miscellaneous Adjustments*5*
[Stage Direction]
.. -511
[Stage Direction]
-482
[Stage Direction]
-482
[Stage Direction]
Total Expenditures - National Accounts
[Stage Direction]
. . 36,312
[Stage Direction]
40,660
[Stage Direction]
44,100
[Stage Direction]
*1) Numbers in these columns should be interpreted as mid-points of ranges of estimates.
(2)	|n the National Accounts, budgetary appropriations to various funds and agencies are replaced by the expenditure actually made by the funds and agencies.
(3)	In the Public Accounts, deficits of government business enterprises are a charge to budgetary expenditures whereas in the National Accounts, these deficits are deducted from remitted profits of other government business enterprises.
(4)	|n the Public Accounts, the government pension and social security receipts and disbursements are treated as non-budgetary transactions whereas in the National Accounts, these transactions are included in government revenue and expenditure.
(5)	As in the case of revenues, the miscellaneous adjustments arise as a result of conceptal differences between the two forms of presentation. These items represent, for example, reserves and write-offs; purchase of existing capital assets, budgetary revenue items offset against budgetary expenditure; expenditures of reserve accounts and revolving funds; imputed items; and, an adjustment for the treatment of expenditures in the supplementary period.
[Stage Direction]
March 31, 1977
Table 7
Government of Canada Non-Budgetary, Public Accounts and Extended National Accounts Reconciliation
	1975-76 Actual	1976-77 Estimated)	1977-78 Forecast!1)
		($ millions)	
Non-Budgetary Transactions - Public Accounts 		. . 572	-1,255	-760
Deduct
[Stage Direction]
Loans and Advances to Funds and Agencies
[Stage Direction]
. . -469
[Stage Direction]
-178
[Stage Direction]
-305
[Stage Direction]
Government Pensions and Social Security Accounts
[Stage Direction]
. . 955
[Stage Direction]
2,249
[Stage Direction]
1,780
[Stage Direction]
Excess of Accruals over Collections
[Stage Direction]
Corporate Income Tax
[Stage Direction]
. . -938
[Stage Direction]
-58
[Stage Direction]
-88
[Stage Direction]
Oil Export Charge
[Stage Direction]
.. -127
[Stage Direction]
-10
[Stage Direction]
-25
[Stage Direction]
Miscellaneous Adjustments!?)
[Stage Direction]
. . 616
[Stage Direction]
127
[Stage Direction]
98
[Stage Direction]
Loans and Other Transactions - Extended National Accounts . .
[Stage Direction]
. . 609
[Stage Direction]
875
[Stage Direction]
700
[Stage Direction]
D) Numbers in these columns should be interpreted as mid points of ranges of estimates.
12) As in the case of revenues and expenditures, the miscellaneous adjustments arise as a result of conceptual differences between the two forms of presentation. These items represent, for example, the adjustments for the treatment of revenues and expenditures in the supplementary period; the change in the reserves and revolving funds; and the adjustment required to bring financial requirements of entities included in the national accounts government sector in line with the requirements of these entities which are met through the Consolidated Revenue Fund.
[Stage Direction]
Friday, April 1, 1977