1977-06-13

Hon. Otto E. Lang (Minister of Transport) moved: that Bill C-46, to amend the Aeronautics Act and the National Transportation Act, as reported (with an amendment) from the Standing Committee on Transport and Communications, be concurred in.


[Stage Direction]
Motion agreed to.
Mr. Speaker:: When shall the bill be read the third time? By leave, now?


Some hon. Members:: Now.


Otto Emil Lang: that the bill be read the third time and do
pass.


Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, we have no intention of delaying this bill any further. However, I wish to comment that it is another regulatory piece of legislation that is not required. We feel that the CTC has enough authority to handle these matters in regard to the provinces dealing with airlines, but we are prepared to let the bill go through on division.


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


Some hon. Members:: Question.


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


Some hon. Members:: Agreed.
Motion agreed to and bill read the third time and passed.


AMENDMENTS RESPECTING CHARGES FOR USE OF AIRPORTS, ETC.
Otto Emil Lang: that Bill C-40, to amend the Aeronautics Act, be read the second time and referred to the Standing Committee on Transport and Communications.
He said: Mr. Speaker, 1 thank hon. members for co-operating in moving forward this legislation. There may be agreement to amend the second reading motion, to provide for this bill to be considered in committee of the whole. When I finish my remarks I shall propose such a change in the second reading motion.
Bill C-40, to amend the Aeronautics Act, deals with several important matters, the first and most important of which is the introduction of more effective zoning provisions under federal jurisdiction. Our airports are important facilities and, obviously, the manner in which land surrounding them is used is important to their future use, and to people who may want to use the land. Sometimes after an airport is built it has been difficult to expand it, because houses have been built there and other activities engaged in. Since airports represent a large public investment it is important for land to be so zoned as not to endanger future development of an airport. We want to avoid such difficulties.
We think you can most effectively zone land through the action of municipalities and provinces which ordinarily concern themselves in the many issues which arise from time to time in communities. Bill C-40, which will allow for the additional exercise of federal jurisdiction, shows clearly that we intend ordinarily to rely on municipalities and provinces to do the appropriate zoning of our airports in order to protect the land. Ordinarily, they will do this after we discuss these questions with them. Sometimes, however, there may not be provincial legislation in existence, or a province may be unwilling to act in a certain way, and we therefore feel that there must be provision for federal jurisdiction under which zoning in such cases can be done. Alberta, after a good deal of discussion, enacted comprehensive zoning legislation which will be fully effective in allowing us to do what we need in the way of zoning around airports.
We have included compensation provisions in this bill which essentially follow compensation patterns provinces ordinarily use in their own zoning. We did not want to set different standards, even though in our judgment sometimes a different scale of compensation would be appropriate. It seems only logical to retain the provincial approach to compensation, since we want provincial governments and municipalities ordinarily to do the zoning. It would not do to have a different standard of compensation, depending on the nature of the jurisdiction, its location, and so on.
These provisions therefore will allow us to work with the provinces. We shall ordinarily enter into discussions with them, and use our zoning provisions when it is either impossible or difficult for a province to do this.
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A number of other changes in the bill are highly technical and deal with questions which have arisen in practice, in the course of our administering safety and licensing aspects of legislation. One clause deals with the collection of fees and the imposition of interest charges on obligations carriers have not paid. This is particularly intended to deal with foreign carriers which have resisted the payment of appropriate fees for the use of our services and airports. The prospect of interest charges will give them an incentive to pay early and promptly, instead of delaying payment and so forcing our collection agencies to seek payment.
That, essentially, is the heart of the bill. I commend it to hon. members.
I now ask if hon. members would be willing to change the second reading motion, to provide for the bill to be referred to committee of the whole, so that it may proceed through all stages. There have been certain discussions and I understand there may be agreement to do this. If I am right, and I would appreciate if it could be determined, I will so move.


Mr. Don Mazankowski (Vegreville):: extent this has taken place. A proper place for this to be considered will be in committee.
Some of the users who have been involved in this sort of thing should appear before the committee. We would like to know how much money has been involved. Why have we been lax in the past, if there have been losses as a result of our inability to collect? Or is this overkill? If not, why have we waited so long? Why is it necessary to force this issue at this time? Is part of the problem that some of the costs are inordinately high and sometimes unjustified? 1 heard the minister say there were some 40 carriers.


Otto Emil Lang: Four.


Donald Frank Mazankowski: Four carriers. We should know who the carriers are and why there has been disagreement over the application of costs.
Clause 3 provides that owners and operators will be required to carry liability insurance. We do not find any disagreement with that. If you are compelled to carry liability insurance for a passenger car, surely no less should be required of an operator of an aircraft. Therefore, I see no problem in that regard.
Clause 4 deals with the maintenance, design or manufacture of aircraft or aeronautical products. That too seems to be a rather natural and logical requirement. However, in most cases these individuals are already licensed. I am not sure whether a duplication of licensing is being proposed here. This bothers me, as do many other pieces of legislation of this nature. It is nothing more than multiplying the bureaucracy.
We have a tremendous boon here to the bureaucratic development of the government. Frankly, I do not see why we need double licensing. Perhaps there is a legitimate reason. If so, this should be brought out and dealt with in committee.
Proposed subsection (5) provides that owners and operators involved in accidents or incidents must report them. It would seem that this is more or less a general understanding. Anyone involved in an accident must report that. In terms of reporting incidents, this might cause some concern, particularly for those involved in the training of pilots, such as the flying clubs across Canada.
In the process of carrying out flying lessons, I am sure that there are many incidents. If every incident must be reported, much will depend upon the definition of an incident. This may involve a tremendous amount of reporting and bureaucratic red tape which may or may not be necessary. I hope that this will be clarified.
It would only be natural that those engaged in the training of pilots in flying clubs be brought before the committee so that we can hear their version of this provision. Perhaps they can assist the committee in putting together an amendment to clarify the provision in that clause. With the sweeping powers the minister has under regulations and the penalties that could be provided, it could be rather intimidating and frightening if this provision got out of hand. I hope this will be looked at as well.
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Clause 4:6.(1) primarily deals with zoning regulations. I understand the organizations known as People Over Planes has some serious misgivings about that particular problem. I would like to quote from a document presented by that organization, which reads as follows:
Land use planning and property rights are clearly a provincial responsibility under our constitution. This act has far-ranging powers. By publication of the intent to impose a zoning restriction and by passing an order in council the federal government can restrict land use anywhere-"adjacent to or in the vicinity" of an airport. Thousands of acres can be affected. The purpose is to keep owners from building houses on properties they already own.
The act allows no hearing of necessity-presumably a draftsman in the Ministry of Transport will determine whose properties are affected. There is no appeal procedure or no consultation required with the affected owners or municipalities. A federal bureaucracy will determine detailed land use in Ontario communities near airports.
Without going into too much detail, there are some questions which have to be clarified. We must understand how far we are going under that particular section. It is urgent and very important that we undertake to have this bill presented to committee in order that witnesses may appear and give evidence of their concerns.
Turning to clause 5.8(1), it deals with boards of inquiry and reads as follows:
The minister may
(a) establish a board of inquiry to inquire into the circumstances of (i) any accident or incident involving an aircraft...
In this connection it is unfortunate the government has not seen fit to adopt the very sensible private member's bill which is now before the House, Bill C-220, which was introduced by the hon. member for Dartmouth-Halifax East. This bill was debated in the House on April 1. The hon. member has campaigned long, hard, and diligently for this legislation. The purpose of this particular bill would be to establish a permanent and impartial commission of inquiry to investigate transport accidents within federal jurisdiction. Under the present law, many of these transport accidents are investigated by the federal body responsible for making and enforcing the rules under which transport operated when the accident occurred. Many of these accidents involve the loss of lives.
The hon. member for Dartmouth-Halifax East has always contended there is a conflict of interest and it should be mandatory that we establish an independent board of inquiry which would sit, independent of the Department of Transport and all other federal regulation agencies, so that there could be an in-depth, impartial, and objective inquiry into all accidents or incidents, particularly in the case where there is a loss of life.
This particular measure was promised in the throne speech of 1974. While there has been a lot of talk about changes in the transportation policy, amendments to the National Transportation Act and various amendments to the Aeronautics Act, the government has not acted very quickly in this particular area. The hon. member for Dartmouth-Halifax East introduced a measure of similar substance back in October, 1970. It was known as Bill C-66 at that time. It was reintroduced as
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Bill C-85, Bill C-33, Bill C-109, Bill C-226, and now it is Bill C-220.


Mr. Baker (Grenville-Carleton):: History moves on.


Donald Frank Mazankowski: Surely in an area as important as safety and the concern of getting to the bottom of accidents which take lives of individuals, a step in this direction is long overdue. Surely it is high time the government took the initiative and enacted this very important principle. I am sure the hon. member for Dartmouth-Halifax East would not mind if the government stole his idea and brought it forth in the form of government legislation. He would be happy if the government would accept his particular bill and enshrine it into law. It is a good bill which has a broad base of support, not only in the industry but in many of the regulatory agencies as well.
There is no branch of the Department of Transport or any other federal agency which has over-all responsibility for ensuring that a systematic, comprehensive, and high standard of investigation is under way. It is important to ensure that safety is practised at all times and, when there is an error, that we get to the bottom of it so that we can avoid future catastrophes.
At page 9 of the bill, Clause 6 sets out to impose terms and conditions on a licence which is already issued. There is some concern here, because unilaterally the commission can change the licence by imposing restrictions, and new terms and conditions on licences which come up for renewal. While there may be some degree of necessity in this regard, it is important to ensure that there is proper access to appeals for those who have licences and find their licences restricted or almost withdrawn, as a result of the restrictions and the regulations added thereto.
At page 10, Clause 7 deals with the licensing of commercial air service. The thing which bothers us on this side of the House is the fact that we have no third level air carrier policy in this country and we have no clearly stated regional air policy. In June, 1975, the former minister of transport said that a regional and third level carrier policy would be forthcoming soon. There has been no mention of this fact ever since. We are asking the Canadian Transport Commission to deal on an ad hoc basis without any set government policy in terms of a third level air carrier policy. When you tie that in with the thrust of Bill C-33, under which the minister is emasculating and abrogating many of the powers in the hands of the CTC, probably the consequene will be that the licensing of these air carriers will be done more on the basis of political considerations, rather than the realities of economics, geography, and need. We should be pressing for a clear definition and statement of regional and third level carrier policy so that it can be meshed into the regulations which are enshrined within this piece of legislation.
It is clear the bill requires a great deal of clarification. It is important that it go to committee and that witnesses be heard. Amendments to some clauses will probably be required with a

view to clarifying the major thrusts of the intended legislation. I hope we can count upon the minister to ensure that there will be an opportunity to deal with witnesses and carry out a thorough, full-scale hearing into the many facets of the bill. In effect, we have been asked to deal with omnibus legislation and we should look at it in that light.


Mr. Arnold Peters (Timiskaming):: I do not want to take very long, Mr. Speaker, but I am interested in some of the comments the previous speaker made, particularly those concerning the new powers being sought by the minister as they would likely affect regional carriers. The suggestion was made that the minister would, in effect, be taking over the powers of the CTC.
I have been watching with some interest applications which have been made to the CTC by these second-line carriers-I use that term to distinguish them from CPA and Air Canada which might be considered first-line carriers. Some time ago I attended hearings which were held in Sudbury concerning an application by Nordair, which had offered a return flight daily from Montreal to Winnipeg via Sudbury and Thunder Bay. I was interested at that time to find that the minister of the day involved himself in those hearings, though in absentia, by sending a letter indicating that no matter what was decided he would not allow the Nordair aircraft to land at some of the airports scheduled because they were not capable of handling the Boeing 737. Apparently it was O.K. for a DC-9 to land there, though everyone knows there is only a difference of a few hundred pounds between the Boeing 737 and the DC-9.
I mentioned to the chairman of the CTC, who had been a colleague of mine in this House for a number of years, that there really wasn't any point in continuing the hearing, the minister having made a decision that the aircraft would not be allowed to land. What would be the sense of discussing whether Nordair should be given the opportunity to service the area or not? The whole exercise seemed foolish. I twitted the chairman of the commission about the matter. The intervention was clumsy, it seemed to me, because those responsible did not even bother to clear it with the district offices. The manager at Sudbury telephoned the district office in Toronto responsible for the safety and conditions of the runways in Sudbury, and the officials there informed him that the Sudbury runway could, of course, carry the Boeing 737. There had been no structural damage and it was not anticipated there would be.
It is interesting to remember, of course, that Air Canada was the operator intervening in that case. However, Air Canada only operated the flights for two months; it has since dropped the service, so the people of Montreal, Sudbury, Thunder Bay and Winnipeg are not able to take advantage of that run. The route is now directed through Toronto rather than through the northern part of the province, passing through Ottawa.
This tells me that if the minister cares to use the power he possesses over the licensing of airports it is he, really, who is able to control the entire operations of the air industry. He
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would be able to decide who was going to fly, where they were to fly from, and where they would go.
There are other aspects of the bill which interest me. One of them is the provision the minister is seeking in connection with the zoning of areas surrounding airports. I am, of course, aware of the need to maintain air clearance in such areas, but 1 have always been of the opinion that this could largely be ensured by agreement and consultation. When a community asks for an airport it is obviously ready to bear these considerations in mind. It is in favour of the project. Otherwise, it is not likely to be particularly successful. For instance, when a new airport was built in Japan the public in the area surrounding it were violently against it; riots at the approaches to the airport have already resulted in a number of serious injuries. Protestors built a high tower to express their feelings. It was torn down, but only after a great furor.
Canada, it seems to me, is large enough to enable airports to be put in locations about which there is agreement. To begin by contemplating buying up land around the approaches to an airport under the Expropriation Act indicates that the government intends to go ahead and make these decisions whether there is agreement or not. I suppose this particular proposal relates to Pickering. I suppose it means that the minister still has in the back of his mind, being the type of person he is, the intention to build Pickering whether the people around there want it or not. If he gets the power sought in this bill he would have no need to ask for any co-operation from the surrounding municipalities. All he needs to do is use the expropriation powers given in this bill and he would be able to make decisions as to the height of buildings surrounding an airport or do anything else he may wish to do.
I imagine that much of this bill arises from the fact that Mirabel has been such a disaster. For us to lose $43 million-


Mr. B6chard:: It is not a disaster.


William Arnold Peters: The hon. member says it is not a disaster.


Albert Béchard: You will see in ten years.


William Arnold Peters: The hon. member comes from that area and he says we shall see in ten years. It seems to me we should not have to wait ten years. Why should we pay $430 million over the next ten years? If we extend the $43 million we are losing this year that would be the cost. Why should we make that kind of contribution when we could probably solve the problem?
We either have to shut down Dorval and operate Mirabel or shut down Mirabel and operate Dorval. No matter how we cut it, there are fewer landings now than there were two years ago. That being the case, we should close one of them and operate out of the other one. The people of Quebec are going to find themselves in a very odd position if no international carriers land in that mess and go to Toronto instead. That would create another disaster in Toronto because that airport is overloaded now.
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We do not want to transfer all international traffic to Toronto, but we had better do something about the Montreal situation because it is a disaster. To reach Mirabel, in Montreal a person gets on a bus and travels around the city for a long time. The time varies according to the traffic, but it is not very easy to get from Dorval to Mirabel or back. It is very expensive. If you go by taxi it costs a lot of money to transfer from one airport to the other.
I personally have not encountered any difficulty at Mirabel. It is a totally different concept, and I have not had any difficulty with the airport itself. It may very well be that we can use Mirabel to its full capacity, but if we do, we cannot operate those two airports so close together. The minister should know about this because it happened in New York, Chicago, and everywhere a second airport has been built. The only ones which are operating efficiently are the small ones, like the ones in Calgary and Edmonton were some carriers operate only out of the municipal airports and move all the local traffic. The local air carriers do not use the international airports. At one of those cities the international airport is about 12 miles out and therefore cannot handle short-run traffic because ground traffic would have to be used for a longer period of time than the air traffic.
We have not been able to operate Mirabel satisfactorily, and we are not doing anything to solve the problem. The minister can say he has this in hand. He can be as callous about it as he wants to be, but it is costing a lot of money. This makes many people unhappy, and we are no closer to a solution than we were the day we opened that airport. I think some hon. members from that area would like to see some of the long-range problems which are developing solved.
There will be a difficulty because international traffic will be going into Toronto where it cannot be handled. I do not think the answer is to build another airport at Pickering, or at Camp Borden, for international traffic. If we did that, we would have the same problem, and we probably would not be any better at solving it. If we move people from Barrie to Toronto or from Pickering to Toronto, we will have the same situation we now have with Mirabel and Dorval, because the minister has no expertise in handling ground transportation. We do not have any rapid ground transportation in this country. We do not seem to be able to buy it from anybody who will operate it in this country satisfactorily.
Let us hope that this bill does not allow the minister to go back into Pickering. If he had the power to eliminate municipal objections which might arise, if he could expropriate, and if we are talking about supersonic aircraft, the minister could get control of a radius of 20 miles or 30 miles around that proposed airport. If we plan to land Concorde aircraft, airports have to be away from large population centres. This legislation provides a considerable amount of control. Before the minister gets that kind of control, I think he has a responsibility to say what he is going to do about the problem he now has which is not being solved.
It really would not be advantageous to limit the CTC's control, as limited as it may already be. I remember what the

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department did in Sudbury. The municipal airport there was under the direct control of the Minister of Transport (Mr. Lang), through regulation. Sudbury was not putting any money into this airport, it was not controlling it or operating it, but because of safety regulations the department said the airport could not handle Nordair aircraft. Therefore it was decided that Air Canada would use that airport. Air Canada got the route, and what happened in that regard is interesting. It operated for several months during a disadvantageous period of time. There was no traffic on the route, and Air Canada was able to drop it within a matter of four or five months. Perhaps Nordair would have had to drop it as well. I am not expert on the financial structure of that route and on how it would operate at a better time. However, Montreal, Ottawa, Sudbury, Thunder Bay and Winnipeg do not have the benefit of that service now because a second line carrier was not able to get the licence because its aircraft would not be permitted to land at the Sudbury airport.
There are a number of other factors which have been mentioned by previous speakers. I think all of us are interested in them. How can there be an accident in which the CTC is involved but which is investigated by the department? There is no question that the government was involved in that famous inquiry into a disaster which happened very recently in the Northwest Territories. The government was involved in compensation as well. There was obviously a conflict of interest, and I do not think we will ever know the truth about that accident because I do not think the inquiry was impartial.
I agree with those who say that there should be full and impartial inquiries into accidents, and that people involved in non-fatal accidents and people dealing with the estates of those involved in fatal accidents should be totally informed and convinced that inquiries are impartial. All the facts should be made available. 1 think that is not the case at the present time, and there are many people who agree.
Another clause in this bill which surprised me has to do with overflights. If everyone making an overflight had to make a deposit, that would mean Russia would have to deposit with Canada a large sum of money. These deposits would be for flights into Canadian territory, whether by helicopters operating off Russian ships in our coastal waters-


Mr. Ellis:: Spy planes.


William Arnold Peters: -or by aircraft which land in the Arctic to do supervision there because we do not have that capability. The Russians are in that area to quite an extent, and so are the Americans. Do we get a deposit from them, or what are we talking about? Are we talking about John Blow who has a $5,000 aircraft and who will have to pay these $100 landing fees at airports? Will he be the guy who will have to put up a bond, or will we get one from the U.S.S.R. or the United States for their overflights? If we think so, then we are dreaming.


John Raymond Ellis: The U-2.


William Arnold Peters: Yes, I was thinking of the U-2 flight. It would have been interesting. If Turkey had a deposit, they would have been able to charge Cuba, and Cuba would have been able to collect on their U-2 because they shot it down. The Americans say it never flew over and that there was no such plane. In talking to the Cuban officials-and that was some time ago-they told us that they still had the body which they kept in deep freeze, and any time the relatives of the deceased want to have the body back, they would be happy to send it back, but the Americans will have to admit there was a plane. They would have been able to collect on the bond on delivery of the body from the aircraft, but they will not collect from the U.S. because the U.S. would not agree to such a bond, nor will Canada collect from the U.S., nor will Russia.
Even the minister is smart enough to know that if he were going to collect that kind of levy for overflights he would need an international agreement. The Secretary of State for External Affairs (Mr. Jamieson) would have to negotiate such an agreement in a proper way because it would be difficult to get agreement from countries which have sovereignty as well. They are not supposed to be flying over another country without permission. That is the way things are.
The other section, which is connected with this, deals with the other services for which we will now be able to charge. I suppose this has something to do with the minister's cockeyed idea about user-pay. It is true that the weather reports cost money and that they are used mainly by the flying public, but they are used for a number of other purposes as well. Aircraft in this country provide a service. If we eliminated all the aircraft, we would slow down our country considerably. For aircraft to fly, some services are needed, regardless of whether or not they land at a certain airport. Even if they have a private landing strip of their own somewhere, they need to have the services that are provided at the airports. They need weather reports, radio beams, radar control, and all the other services provided at a modern airport.
You may remember that a former minister of transport not long ago proposed that landing fees be paid at airports. That would have eliminated all training schools in the country. There was talk about a landing fee being paid every time a plane touched down. If a plane made several circuits and bumps on landing, it would have to pay a landing fee for each one. A training pilot has to make 50 or 60 landings, and each landing would cost some money.
We are helping in the financing of pilot training through other programs, and I think rightly so. I think that a country the size of Canada needs to train as many pilots as possible. A person in training to become a pilot today is making quite a contribution to the industry, as well as eventually to the country. He has to learn something about navigation, about the operation of airports, as well as about the operation of the industry in general. He may become a commercial pilot or someone involved in the field of aeronautics, in design, testing and research, and that will be of advantage to Canada.
We should know whether the minister is really talking about the licensing of airports in accordance with the user-pay
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concept, because there are many airports in this country and training schools are attached to airports and they bring no real income to them. Airports at training schools could be used as emergency landing fields, a sort of auxiliary field to a major airport, but they are used mainly by the training schools.
You might remember that during the war there were hundreds and hundreds of small airfields across the country which were maintained solely for the purpose of emergencies. Nobody landed on some of them for years, but they were maintained, the grass was cut, and a certain amount of gas was kept for emergency purposes. Many of these small fields were later developed into training fields, and I think this is advantageous. I believe it would be a very bad idea if we were to charge them for the use of radar and for the wages of the guy who operates the radar, because they cannot use it; it is of no value to them. In some cases we would not be able to charge them for the use of radio because they are not properly equipped, and certainly they would not be able to use the sophisticated landing devices for which other aircraft have to pay.
I suggest we should be very careful in the way we implement the user-pay concept at airports. This is particularly true with regard to the small non-government operated airports. It appears to me that the minister wishes to obtain control over those as well.
The minister is asking for powers that are not justifiable and are certainly not needed, nor is it in the best interests of the industry and of the people who are using the facilities for the minister to have such powers. While it is close to the end of the session and most hon. members want to go on holidays-


Some hon. Members:: No.


William Arnold Peters: Well, the attendance here today indicates that I am more correct than those who say no.


Mr. Goodale:: Only members of the NDP have that in mind.


Mr. Knowles (Winnipeg North Centre):: We are here.


William Arnold Peters: There are only a couple of airports in my riding, and one of them is a fairly good sized airport. 1 am sure there are other members of the House who have municipal airports in their ridings. I am sure there are a few in whose ridings there are pilot training schools. I am sure they have been shocked by the way we have conducted the inquiry into the accident that occurred in the Arctic, and by the way we have conducted the inquiry into the accident that occurred between James Bay and Timmins not long ago in which nine people were killed. I am sure that many people are shocked at the services, or lack of them, at airports.
I am sure members are well aware of the problems in their areas. I am suggesting that they are willing to give the Minister of Transport anything he wants, for two reasons. One is that there is not much they can do about it, because he will take these powers anyway. He is the most dictatorial Minister of Transport we have ever had. The other is that they want to go on their holidays and they are not greatly interested in
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speaking on this subject. If I am wrong, I am sure I will hear denials from a number of members who have more at stake in this bill than I have, and who represent people who are directly concerned with this piece of legislation. I am sure that they will have something to say, so I shall sit down and let them speak.


John Raymond Ellis: Mr. Speaker, my interjection in this debate will be relatively brief. I intend to look at some of the clauses of the bill before I spend time on the two main portions that I am basically concerned with, one regarding investigation of accidents and one regarding licensing of proposed scheduled airports.
The hon. member for Vegreville (Mr. Mazankowski) went into a couple of matters in considerable detail. He spent some time talking about the liability insurance clause. I have no objection to the fact that aircraft owners should have liability insurance. As an owner of many years standing I have always felt it absolutely essential, and I think anyone who does not carry it is being irresponsible. But I am concerned that the department is getting involved in this and not the CTC which would seem to be the regulatory body that should be involved.
I am also curious about the level of insurance that individuals will have to carry. It seems to me that if this is to be set arbitrarily by the department, this House should have some idea of the level before the legislation is passed.
The hon. member of Vegreville also dealt with the licensing of persons engaged in the design, manufacture, or maintenance of aircraft. In the past two decades there has been an increase in the number of home-built aircraft. These are built by very dedicated people who use their tremendous skills as machinists, carpenters, or as other types of tradesmen. They are usually built in basements, garages, backyards, or sometimes in a spare building at a small airport. These people have traditionally built very fine aircraft for their own recreation. Are they each to be separately licensed as a manufacturer under this legislation? This is something we want to find out. The same question comes up about licensing the premises on which an aircraft is manufactured. Does the department want to license the basement of a home because someone is building an airplane there? I agree that the legislation should go to committee for long and thorough examination.
A particularly interesting portion of the bill concerns the licensing of airports. The hon. member for Timiskaming (Mr. Peters) mentioned that there are not many airports in his area, but he was concerned about the user-pay principle. There are only a few airports in my area but there are other places where planes land. The Flying Farmers frequently come in on a grass strip owned by one of their group. Perhaps on a Sunday afternoon a farmer invites eight or ten others in the area to land on his field; they have a barbecue, and then fly off again. Is there to be an inspection of this type of field as well as of major airports?

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And what about the fixed base operators? They perform a useful service in the small airports across the country. Are they to be affected by these regulations?
One of the things that I have encountered as a pilot, and which has been brought to my attention by other pilots, is that the Department of Transport seems to practise a policy of frustration or an adversary way of doing things. Whenever a private pilot wants a change in his licence, a change in the medical designation, it would appear that he is in an adversary situation with the department. The first answer to his request is always no, and then he must prove his case.
Not long ago I had an encounter with the department over my medical designation. It has since been changed, but the first notice I had was when my licence came through with an entirely different grade on it. I did not receive any indication that they were concerned about my medical adequacy for flying, before the licence came. There was no chance to provide further medical evidence, no chance to get a second medical opinion, just the licence with the new grade. I have not done much flying over the past 15 or 20 years so this was not a critical matter, but if I were flying for a living my livelihood would be affected. I get the same complaint from other pilots.
Then there is the matter of zoning regulations, which I think are worthwhile. I think the amount of building that has taken place around Malton Airport should have been curtailed, and I know I am supported by many people when I say there is no need for an airport at Pickering. The twinning of the north-south strip at Malton would provide all the service we need in the next two or three decades. As a private pilot I do not use Malton very much, but when I do I can get in and out without difficulty. It is not as busy as O'Hare or Kennedy, or some of the other large airports in the United States.
Zoning regulations vary from province to province. It is fine for the federal government to encourage universal zoning, which might be accepted as the National Building Code has been accepted, but I do not think it is necessary.
The hon. member for Vegreville also mentioned the People Over Planes Group. I do not have a great deal of sympathy for some of the leaders of that group who espouse politics rather different from mine, and who turn up in all parts of the country as troublemakers at various hearings. Nevertheless, they have a point. Presumably a draftsman from the Department of Transport would draw a line around an airport and determine which properties are affected. As I understand the legislation, there is no provision for appeal, and there is no consultation with the affected owners or municipalities. The federal bureaucracy will determine the detailed land use in any province near an airport. From the way the compensation clauses are written it would appear that the federal government could weasel out of paying compensation.
1 shall speak mainly on two topics, the first being the licensing of a proposed, scheduled commercial air service. I think the Department of Transport could do much more to promote third level services. A few years ago we used Twin
[Mr. Ellis.)
Otters in an experimental air service between Ottawa and Montreal. There was so much wrong with the service that I have not time to enumerate all the complaints. If the department is interested in such air services it might consider using the new Dash-7 on a scheduled, hourly commuter service in the Montreal-Ottawa-Toronto corridor, with a stop-over at Trenton as well. Colleagues from western Ontario may wish the service to extend as far as London, to which I would not object. But we should provide a service for the cities named in the corridor, which are strung out at between 125 and 150 miles intervals. I think the Dash-7 is the right aircraft to use.
The Twin Otter is a delightful aircraft but not suitable for commercial use. It is not comfortable, has fixed landing gears, and is not equipped properly for use as a commercial aircraft. The Twin Otter service between Montreal and Ottawa was an experiment, but not too successful. If that kind of service is to succeed it must operate from top notch airports. The Twin Otter service was grounded so often because of bad weather and other factors that it could hardly be called reliable.
The Dash-7 service could operate from Dorval, in Montreal, Ottawa International Airport CFB Trenton, and Toronto International Airport, all of which are equipped with the finest air navigation and landing devices in North America. I suggest Trenton as a stop-over, because it is half way between Ottawa and Toronto, and would serve a growing community of about 350,000 people in the Kingston-Cobourg corridor who want the service. Industrialists in the area sometimes complain to me that their means of access to Montreal and Toronto is inadequate. True, they can use the train, but the Via CN train service is not yet operational. The people of the area need an air service to link them with major air services departing for overseas points from Dorval or Toronto international. At present businessmen must either drive a car, or take a train. An industrialist in Belleville told me recently that when he returned from his trip overseas, his parking charge was approximately $38. Surely that $38 could have bought him a seat on an aircraft going from Trenton to Toronto or Montreal.
I do not make my suggestion lightly, for I intend to urge the department, with all the strength at my command, to begin such a service. I want to see a regular, commuter airline service serving the points I mentioned. At CFB Trenton we already have one of the finest airports and facilities in all Canada. There is a magnificent landing instrument system in place so that the service should not cost a great deal to install. We would need some facilities on the south side of the main base for civilian use. Some security measures will need to be taken, but there is lots of space. Although I have not had a chance recently to discuss this question with the people at the national headquarters, or with the base commander, I know from my experience in the past that there would be general agreement for such a service. Knowing how anxious the members of our forces are to do what is good for all Canada, not just for the military establishment, I am sure we can get their agreement.

That brings me to my last point, which the hon. member for Vegreville perhaps did not cover in sufficient depth. We did not know this bill was to come forward so soon and he and 1 have spoken off the cuff, without benefit of the research which would enable us to scrutinize more narrowly and perhaps attack some parts of the bill.
I am concerned about aircraft incidents, and their reporting.
I am thinking of accidents. 1 was intrigued to find that a little document on aviation safety had this to say some time ago:
Transport Canada has set up an interim aircraft accident review board pending the establishment of an independent transportation accident investigation board which was approved in principle by cabinet in April 1975 .. .
If the cabinet approved the establishment in 1975 of an independent review board, what business has the department in setting up its own board? 1 disagree with this entirely, and I do not think the department should be setting up its own review board. I am not proud to remember that once I flew an aircraft upside down into a pasture; I walked away from the crash, relatively unhurt. At least, here I stand.


Mr. Fraser:: But not unaffected!


John Raymond Ellis: 1 am sure damage was done, but I walked away. The investigation was cursory. 1 reported the accident to the nearest airport, answered a few questions, and that seemed to be the end of it. Perhaps that was a relatively minor accident which happened many years ago. However, in the accident with which the hon. member for Timiskaming dealt, there was an obvious and definite conflict, in the sense that you can hardly have an impartial review when the body which is going to look into the accident and lay charges arising from it is also involved in the making of regulations.
I point out that in 1974 the hon. member for Dartmouth-Halifax East (Mr. Forrestall) introduced a private member's bill for establishing a permanent and impartial commission whose job would be to look into and investigate transport accidents. The cabinet approved in 1975 the setting up of an independent investigation board. Why did it not act on the hon. member's recommendation?
Although I have not discussed the point with my colleagues,
I am sure they will agree to fight long and hard over this bill, as the minister well knows. I realize we are approaching the summer recess. I am aware the government is most anxious to be out of here by the first week of July so that certain alterations can be made to this Chamber. I have no objection one way or the other. My constituency is close. I travel back and forth every week. I can be here on Mondays and Fridays when the House is a little thin, so 1 am not worried if we stay here all summer. I want to go on record as saying that I intend to debate this bill for a good long time.
We want to induce the minister to take cognizance of the very worth-while bill introduced by the hon. member for Dartmouth-Halifax East. We would like to see that legislation accepted, or a government bill put in place to do that job.
There is a conflict here that has to be resolved. The way to resolve it is obvious; sometimes it is not obvious in other pieces
Aeronautics Act
of legislation. I am prepared to spend as much time as necessary to try to convince the minister that this step should be taken.
I see my time is almost up. I close by saying that I have always had a very strong concern with regard to the area of regulation. Canada is a free country. By and large, Canadians are a free people. However, we seem to be faced with more and more restrictive regulations that are very difficult to justify. A number of regulations contained in this bill are difficult to justify. I look forward to dealing with some of them in committee and to receiving a reply from the minister as to whether this area that is so basic and important can be handled in an entirely different way, either the way suggested by the hon. member for Dartmouth-Halifax East or something akin to it, so that we might have a proper review court.


John Allen Fraser: Mr. Speaker, I wish to carry on this debate from where my colleague, the hon. member for Hastings (Mr. Ellis), left off, and to reinforce his plea that all members of this House pay attention to the necessity of establishing an independent board for the examination of accidents involving aircraft in Canada.
In the bill before us. Bill C-40, Section 8 of the Aeronautics Act is amended. It provides authority for the minister to establish a board of inquiry to investigate the circumstances of an accident. It is completely permissive. It does not carry with it the mandatory provision to establish an investigatory board which would be completely independent of the department or the divisions within it.
The hon. member for Dartmouth-Halifax East (Mr. Forrestall) has repeatedly been advocating in this House, commencing in the year 1970, that an independent review board be established. It is a matter of considerable regret to all members of my party that the hon. member, not knowing that Bill C-40 was coming forward today, is unable to be here today to speak on it.
The hon. member for Dartmouth-Halifax East first introduced a private member's bill calling for an independent board to investigate accidents on October 20, 1970, Bill C-66. The substance of that bill has been in front of the House ever since, once as Bill C-85, subsequent to that as Bill C-333, Bill C-109, and Bill C-226. It was debated in the House on April 1, 1977 as Bill C-220. The opening of that debate is reported in Hansard for April 1, 1977, at page 4581.
If you look at the debate which the hon. member for Dartmouth-Halifax East led on April 1, 1977, you will see that the arguments in favour of an independent board are overwhelming. The arguments were so well stated at that time by the hon. member that, in the reply on behalf of the government by the Parliamentary Secretary to the Minister of State for Urban Affairs (Mr. Gauthier), the following was said, and I shall quote his reply. Under the circumstances I think this should again be placed on the record for hon. members on the government side. This is the spokesman for the government putting forward the government's view of the hon. member's private bill calling for an independent tribunal. I ask all hon. members to pay attention to this, especially members on the government side.

June 13, 1977
Aeronautics Act
The parliamentary secretary said, and 1 quote:
At the outset I wish to thank the hon. member for Dartmouth-Halifax East (Mr. Forrestall) for his patience and co-operation with us in dealing with this bill concerning the creation of an organization for impartial investigation of transport accidents. He must be setting a parliamentary record of sorts as this is, I believe, the sixth time the bill has been considered at private members' hour. However, unlike many other bills that are presented, the objective of this bill does command broad support from all parties, and we wish it to receive further consideration.
I emphasize that because the government is now on record as supporting in principle the substance of the bill which the hon. member for Dartmouth-Elalifax East submitted to this House, as the parliamentary secretary pointed out, six times.
We have before us Bill C-40 which, as the hon. member for Vegreville (Mr. Mazankowski) said, is a multifaceted bill. There was no reason why the substance of the private bill to which we have been referring could not have formed part of this bill. There is no excuse in the world, especially now that the government has indicated it supports the substance of that bill in principle.
I do not have to tell anyone in this House how often the media and the public laugh at the whole situation of the private members' hour. However, when a private member, no matter from which side of the House, brings in a bill six times, and the substance of it meets with the approval of the government, it seems incredible, when there is an opportunity to put the substance of that bill into a bill put in front of the entire Chamber, that it is ignored. No doubt somebody from the government will say it is still being considered. The question is whether it is being considered sincerely, whether the government's words that it supports it in principle are sincere. 1 notice the Minister of Transport (Mr. Lang) is indicating by nodding his head that they are considering it sincerely.


Otto Emil Lang: Would the hon. member permit a question? I appreciate his reference to the investigation review board and to the government's commitment to it. I wonder if he recalls, first of all, the announcement of the interim board, which was clearly a step pending the development of the legislation to provide for an over-all, independent investigation review board. In his reference to the possibility of including a provision here, would he not agree that it is desirable to broaden the scope of the application to cover aspects other than air and that this would be a good reason to come forward-an early date, I agree-with a bill rather than an amendment to the Aeronautics Act?


John Allen Fraser: I thank the minister for his intervention. It might well be that what he suggests is appropriate. I am just reminding him and members of the government that this has now been under consideration since 1971-there are many references to it in the record. If the minister's remarks are to be taken as an indication of his own concern, and the concern of the government, I welcome them and thank him for his intervention. But so that neither he nor any other member of the government may forget when this debate is over the assurances which have been given, let me remind them they

are on record as supporting the principle of the bill put forward by my hon. friend from Dartmouth-Halifax East.
Let me recall that in the Speech from the Throne of September 30, 1974, reference was made to the intention to establish an independent accident investigation board. Then, in May, 1975, the minister of transport of that day assured the House that his department was "exercising pressure on the government House leader to bring in legislation as soon as possible". In October of 1975 the present Minister of Transport said in response to a question in the House that work on the legislation was "going forward". Later, on December 2, 1976, the matter was raised again at a meeting of the standing committee when questions were directed to the deputy minister, who said that the matter of an independent accident investigation board was still under consideration in the department. He added that a memorandum to the cabinet should be ready in six to eight weeks, in other words, by the end of January, 1977.
I take it from what the Minister of Transport has just said that the government is finally taking this matter seriously. It is my plea to the minister, and to all hon. members, to maintain reasonable pressure on the government to bring forward this legislation, or take immediate steps to consult with members on this side and, perhaps, with members on the government side who support the principle, with a view to bringing about any necessary fine point adjustments in the private bill standing in the name of the hon. member for Dartmouth-Halifax East. That bill could then be sent to committee, and brought back to the House for passage.
It has been a privilege to take part in this debate. This in an issue in connection with which the hon. member for Dartmouth-Halifax East has worked diligently and with great concern over a number of years. It would appear from the minister's remarks that this long and diligent service in a necessary cause may at last come to fruition, and I am sure hon. members generally will join with me in applauding the efforts of my hon. friend in this regard.


Mr. William Knowles (Norfolk-Haldimand):: Mr. Speaker, I rise to take part in this debate in order to supplement representations I have made to the minister by way of correspondence in relation to the topic I have in mind-I refer to the Mount Hope airport which serves the area I represent.
Bill C-40 gives me an opportunity to do this because it would provide the minister with extended authority in connection with planning development around airports and certain of the facilities required in connection with the expansion of airports. Almost a year ago the minister appointed an ad hoc committee, composed of representatives of various municipalities surrounding Mount Hope, to consider whether a new site should be allocated to serve Hamilton and my area, or whether the facilities at Mount Hope should be extended. The minister has had the report in his hands for some time, and everyone in my area is wondering why no decision has yet been announced.
The report says that Mount Hope could be expanded. We are wondering why he has given no indication as to what he
June 13, 1977

intends to do. This is a matter of particular significance to the municipalities which I have the honour to represent because should the minister, for some unknown reason, decide to select a new site, he will be upsetting the regional plan for the Norfolk-Haldimand region which I represent. Officials and municipal representatives have been working for almost a year to bring out this plan and, as I say, it would be totally upset were the minister to decide of another location for the airport. The mayor of the Township of Haldimand, Mr. Dave Pearson, spoke to me some time ago asking me to do all in my power to persuade the minister to make ^n early decision, hopefully, to expand the airport at Mount Hope.
The need is urgent since more sophisticated electronic equipment for instrument landing is badly needed at Mount Hope. Many a time I have stood at the airport there waiting for a plane to come from Windsor or Pittsburgh, or Ottawa or Montreal, only to see the airplane make a pass at the airport, find the fog too dense to land, and fly on to Ottawa or Malton where suitable installations were in place to enable a landing to be made. This caused personal inconvenience, but I was only one of many who were unable to get aboard.
Expansion of the facilities is necessary to serve not only the great industrial city of Hamilton, and the Niagara area, but also to meet the needs of the new industrial complex which is taking shape in Nanticoke in the midst of my riding. There, Hydro has built the largest thermo-generating plant in North America; Stelco is installing a rolling mill and a totally new steel-making process which will come into operation very shortly. In addition, Texaco Canada is building the largest oil refinery in North America on this site. All these new facilities are looking to be served from the nearest airport, which is at Mount Hope. This being the case, it is surely incumbent upon the minister to get on with the job and let us know when Mount Hope is to be expanded. As I said at the beginning of my remarks, I have written to the minister on this matter. I think I wrote him as long ago as February but have not yet received a reply. We are wondering why a decision has not been announced.
Let us not leave the municipalities hanging in limbo and in uncertainty. Let us say we are going to expand Mount Hope. I have talked to residents living in the little village of Mount Hope, and they tell me they have become accustomed to aircraft landing and taking off. Many of them live there and do not even notice it is happening. In addition to that, there are new homes which have been built in that village with full knowledge that the airport was there. Therefore the argument cannot logically be made that it is going to do any great harm to the local residents in the immediate area of Mount Hope. This is where the ad hoc committee is going to recommend to the minister that the least resistance is coming from in that particular area, so let us get on with Mount Hope.


Mr. Bill Kempling (Halton-Wentworth):: Mr. Speaker, I have a few things I want to say on Bill C-40. Let me say at the outset that one of the difficulties and dangers we are facing in
Aeronautics Act
Canada is the continuous build-up of bureaucratic boards and tribunals, and the build-up of power in the hands of the minister or the governor in council to regulate or change regulations, without reference to parliament and without provisions for appeal. The regulations have the force of statute and remove from parliament much of its power and authority. There is no reason, in my mind, why regulations cannot be attached to legislation, debated, and be examined by a committee before the legislation proceeds to its final stages. In Bill C-40 we see a move away from this direction once again.
I want to read into the record a letter I received from a constituent, on the contents of Bill C-40. This gentleman is an aviation consultant, and his letter to me covered the bill so completely that I think it is proper to read it into the record in its entirety. The letter is dated May 3, and it reads as follows:
Dear Mr. Kempling:


BILL C-40, AN ACT TO AMEND THE AERONAUTICS ACT
[Stage Direction]
On March 9th, 1977, Bill C-40 was given first reading in the House of Commons in an effort by the government to effect certain amendments to the Aeronautics Act that would result in the provision to the Minister of Transport powers that would have far-reaching consequences for the aviation community. 1 have read this bill carefully and I have grave concerns over its content and the ultimate effects to the Canadian people should it become law.
For several years, Transport Canada has been attempting to implement a full cost-recovery program with respect to the utilization of airport and aviation facilities in Canada, and on page 1, paragraph 2, you will find legislation proposed that would empower the minister to impose charges for airport facilities and services. If the existing Aeronautics Act is not appropriate for these purposes, then one must ask about the minister's authority to levy the current charges. It may well be that Transport Canada would find it easier to implement its own charges under this proposed legislation without involving Treasury Board, and this may be the case. If so, then this amendment would not be in the best interests of Canadians or the government that represents them. A minister should not be allowed to set up his own charging schemes without opportunity for scrutiny by the House and Treasury Board. In recent years, we have become increasingly concerned over the high cost of administrative activities within Transport Canada that seems to drain the minister's resources, not to mention the operational cost and debt that is attached to Montreal's Mirabel airport, and this new attempt by the minister to establish his own authority for the setting up of user charges cannot be allowed to take place.
Further, in this section 5, you will find the following subsections which, I believe, encroach upon the rights of all Canadians:
Subsection 2 provides that owners and operators of aircraft may be required to deposit security with the minister to ensure full payment of charges to be imposed upon such owners and operators in the next following year.
Since all pilots, duly licensed, are, in fact, operators when they are at the controls of an aircraft, this legislation would mean that the minister could force every pilot in Canada to place a bond or cash on deposit with his office before re-issue of the pilot's flying licence could take place each year or every six months, depending upon the type of certificate held, even if there was no planned intent by that pilot of requiring use of those airports and/or facilities which might attract payment for services. What about the thousands of pilots who fly for recreation and personal transportation and never use DOT facilities? What about the thousands of Flying Farmers whose aircraft are operated solely from private aerodromes and often are not even equipped with the avionic equipment necessary for operating into and out of DOT airports? Should these Canadians be forced to deposit $100 or $500 each year as a security bond? That would be ludicrous!
In these regards, what has happened to the accepted manner of doing business of paying for goods or services rendered when those goods or services have been provided to the satisfaction of the customer? Just because one might consider buying a certain commodity, should that person be required by legislation to place on deposit a security bond for the, as yet, unpurchased commodity? Will the minister's wishes be granted and he be allowed to force every pilot to place a
[Stage Direction]
June 13, 1977
Food and Agricultural Policy
deposit with him, and if so, wilt not the income tax department be next? We all know for-
I have to read the writing here.
An hon. Member:: You had better start writing your own stuff.


William James Kempling: No. This is an excellent letter which gets to the heart of this matter. It continues:
We all know for almost certainty that we will have to pay personal income tax next year. Would it not be nice if the income tax department could force us al! to remit in advance rather than as we earn the income as is the present practice? One can, of course come up with all kinds of silly examples in these regards, but the plain, simple fact is that this proposed legislation is stupid.
May I call it one o'clock?


The Acting Speaker (Mr. Turner):: Order, please. It being one o'clock, I do now leave the chair until two o'clock p.m.
At one o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.


Mr. Jack Murta (Lisgar):: Mr. Speaker, I rise under Standing Order 43 on a matter of urgent and pressing necessity, namely, the meaningless food strategy for Canada statement presented to the House of Commons on Friday, June 10, by the Minister of Agriculture and the Minister of Consumer and Corporate Affairs. Because of the importance to Canada of a well thought-out food and agricultural policy, and because the government, through its policy statement, has clearly shown it does not have such a policy, I move, seconded by the hon. member for Central Nova (Mr. MacKay):
That a special House of Commons committee be formed to study and report back to parliament their findings on a national food strategy for Canada.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


GOVERNMENT ADMINISTRATION
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a motion of urgent and pressing necessity. It is based on a study done by Douglas Nixon on order in council appointments made by this government since 1968. He found that at least 200 of the order in council appointments since 1968 have gone to former Liberal candidates in federal and provincial elections, or their spouses. The study did not include the big plum of the Senate appointments or appointments to the prime minister's staff or cabinet ministers' offices. Therefore, I move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That the subject matter of the Douglas Nixon study be referred to the Standing Committee on Privileges and Elections.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


SOCIAL SECURITY
Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, under the provisions of Standing Order 43, I ask for the unanimous consent of the House to move a motion dealing with an important matter of pressing necessity.
In view of the fact that the number of unemployed is constantly increasing and that minumum wages which vary from one province to another are unlikely to solve that serious problem, I move, seconded by the hon. member for Abitibi (Mr. Laprise):
That the House urge the Minister of National Health and Welfare (Mr. Lalonde) to introduce immediately a bill for the establishment of an annual guaranteed income to give decent living conditions to every Canadian citizen and enable those who can do so to work without being penalized as is the case in the social legislation now in effect.


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 unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.
June 13, 1977


CANADIAN BROADCASTING CORPORATION
Mr. Donald W. Munro (Esquimalt-Saanich):: Mr. Speaker,
I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. In light of the failure of the Canadian Broadcasting Corporation to provide live coverage of the jubilee celebrations for Her Majesty, the Queen of Canada, which other North American networks managed to do, and of its failure, once it began to carry the program, to do so without a breakdown-a technical shortcoming that other networks, whether in Canada or the United States, did not experience-and in view, further, of the attitude of many of the CBC announcers and program directors, epitomized, perhaps, in the needlessly disrespectful program on Sunday morning satirizing the entire jubilee festivities, I move, seconded by the hon. member for Moose Jaw (Mr. Neil):
That an investigation be ordered into the CBC's technical and program activities related to these incidents to determine where responsibility lies for thus downgrading and otherwise undermining one of Canada's most revered and honourable institutions.


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


ROYAL CANADIAN MOUNTED POLICE
Mr. Stuart Leggatt (New Westminster):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter that I believe is becoming more urgent every day. In view of the continuing concern over the role of the RCMP in the following matters, the illegal break-in at L'Agence de Presse Libre in Montreal, allegations surrounding the Praxis break-in in Toronto, allegations of illegal bugging given at the inquiry in Edmonton, the conviction of RCMP officer Samson in Montreal, the inquiry into RCMP activities, in New Brunswick, and in view of the information revealed by the CBC last night of the growing influence of organized crime in Canada, 1 move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House recommends a royal commission to be commenced into the question of political control over the RCMP. either in camera or otherwise as may be appropriate, and further that the specific role of the RCMP as previously referred to in the motion be included in the subject of the inquiry.
Oral Questions


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Mr. Joe Clark (Leader of the Opposition):: Mr. Speaker, my question to the Acting Prime Minister relates to the research study published this morning which states that since 1968 some 200 ex-Liberal candidates or their spouses have been appointed to a variety of positions within the Canadian judiciary, regulatory agencies and the public service. No one pretends that this is a complete list. I should like to ask the Acting Prime Minister whether he and the government condone this type of massive patronage, and whether this administration plans to continue a patronage policy which in effect will allow loyalty to the Liberal party to be such a primary qualification for appointment to public positions?


Hon. Allan J. MacEachen (Acting Prime Minister):: Mr. Speaker, I do not regard the facts the hon. member refers to as constituting massive patronage.


Some hon. Members:: Oh, oh!


An hon. Member:: What would you call it?


Allan Joseph MacEachen: Since 1968, I understand that on average the governor in council has made 600-plus such appointments per year.


An hon. Member:: Give us the whole list, then.


Allan Joseph MacEachen: When you look at the list of persons, whom I regard as highly qualified, the result shows considerable restraint.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Mr. Speaker, I presume the Acting Prime Minister is saying that one or two former Liberal candidates might have been overlooked. I am sure he will consult their qualifications and find some useful reward for them. This, clearly, is a government that relies upon the practice of patronage, to the detriment of the public service. One of the aspects which concerns us very much is the effect of these political appointments to regulatory bodies and appeal agencies that are presumed to be and can be respected only if they are independent of the political party that is in office.

June 13, 1977
Oral Questions
I ask the Acting Prime Minister, who has now defended this practice of patronage and indicates that it is intended to continue it as usual, to tell the House how the people of Canada can be guaranteed that regulatory and appeal agencies will be able to function free of suspicion and bias when so many members of those regulatory and appeal agencies are affiliated with the political party which forms the government whose actions are being regulated or appealed?


Allan Joseph MacEachen: Mr. Speaker, the Leader of the Opposition has a good point when he raises the question of the competence of individuals who may be appointed. I have never thought that participation in the public life of Canada should constitute a bar to appointments in various aspects of the public service. I have no hesitation in saying that I believe, experience gained in public life often constitutes a useful "plus" in the filling of these appointments. If you examine the list of persons enumerated in this morning's newspaper, you will find a collection of talented people who may have served in the Liberal party. They may have been ministers or candidates. At the same time, they should not be barred from public service. Among the persons on the list to which the hon. member referred are appointees to the courts. I do not think the hon. member would suggest that persons appointed to the courts by either party would demonstrate, or in the past have demonstrated, any bias in their work,
I believe the same judgment applies to those who may be appointed to regulatory agencies. Perhaps I have a little longer memory than the hon. member has, because I was in the House when the right hon. member for Prince Albert used to appoint eminent gentlemen of the Conservative party to such bodies.


Charles Joseph Clark: Mr. Speaker, may I ask another supplementary question? I cannot dispute the length of the memory of the Acting Prime Minister. Indeed, the length of that memory has probably contributed to the appointment of a number of the people whose qualifications we have some cause to question.


Some hon. Members:: Oh, oh!


An hon. Member:: Name one.


Walter David Baker: You are really feeling the heat on the government side.


Some hon. Members:: Oh, oh!


Charles Joseph Clark: Mr. Speaker, nobody would dispute that participation in public life should not be a bar to those kinds of appointments. The question is whether participation in public life during that intensive two-month training period which people go through as candidates in the losing cause of the Liberal party should in itself be regarded as the only qualification for appointment to the public service. I notice the Acting Prime Minister avoided, or tried to put aside, the question of the reputation of freedom from bias of regulatory agencies and appeal bodies. I should like him to address his mind to the response to this question: How are we going to guarantee that

the reputation or independence, so essential for regulatory agencies and appeal bodies, will be safeguarded when so many members of those bodies have been appointed for reasons which, on the face of it, appear to relate strongly-too strongly-to political loyalty to the party whose decisions as a government are being appealed or regulated? How are we to have that safeguarding of the reputation of bodies which, unless known by the public of Canada to be functioning independently, are not able to do their jobs?


Allan Joseph MacEachen: Mr. Speaker, I believe the strongest guarantee against such evidence of bias is the integrity of the persons appointed. I do not think there is any other guarantee.


Walter David Baker: That is the point.


Allan Joseph MacEachen: I have already referred to appointments to the judiciary. I think it is the experience of all of us that when you select persons of integrity, as we attempt to do, for that work and for other regulatory bodies, they shed their bias and do their job in the public interest. If the hon. member has any evidence to the contrary, I am sure he will bring it to the attention of the government.


Charles Joseph Clark: What is of concern to us is not so much the integrity of the individuals appointed as the integrity of the government appointing them.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: We on this side of the House question that. Another aspect on which I would like to allow the Acting Prime Minister to try his hand, if he will, is the matter of Crown corporations. The list this morning indicates-again make it clear that it was not a complete list-that that has been a guiding factor, to say the least, in the appointment of members to the boards of directors of Crown corporations in this country. In recent months there has been much concern about the efficiency and the regularity, in some cases, of the operation of Canadian Crown corporations. Can the Acting Prime Minister in his eloquent, long-minded, long-memoried, defence of patronage tell this House and the people of Canada so that they can have a guarantee that Canadian money will not be wasted and that Canadian policy will not be made badly by boards of directors of Crown corporations when they are appointed, not because of their knowledge of the subject matter with which that Crown corporation deals but because of their loyalty to the Liberal party of Canada.


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: Mr. Speaker, I think the Leader of the Opposition and I disagree on that point. I believe these persons are selected on the basis of the contribution they make to the work of the public service. I must say that when I looked at the list this morning I was quite impressed with the quality of persons who were available for this kind of service in Canada. The hon. member should keep this in perspective by recalling
June 13, 1977

the fact which I mentioned earlier, namely, that on the average about 600 such appointments are made per year. If the list is complete-and the hon. member would know that better than I-then it constitutes a relatively small portion of the total number of appointments.


GOVERNMENT POLICY RESPECTING APPOINTMENTS TO PUBLIC SERVICE
Jack Burnett Murta: Mr. Speaker, 1 have a supplementary question for the Acting Prime Minister. Undoubtedly, this morning's newspaper report also missed the rolls of Liberal campaign managers, bagmen, PR men and party hacks of various descriptions. My question to the Acting Prime Minister is simply whether it is government policy to create a partisan public service. If not, will he at the earliest opportunity be bringing under the Public Service Commission the bulk of order in council appointments to prevent this from happening?


Mr. Speaker:: Order, please. The hon. member for New Westminster.


Jack Burnett Murta: A supplementary, Mr. Speaker.


Mr. Speaker:: By the most basic definition of supplementary questions, they must arise out of the response to the original question.


ADMINISTRATION OF JUSTICE
Stuart Malcolm Leggatt: Mr. Speaker, my question is directed to the Solicitor General. Yesterday's CBC program on organized crime revealed that the major chemical drug capital of the world world-1 think those were the words used-was Toronto. In view of the responsibility of the RCMP in terms of narcotic control, will the Solicitor General advise whether any charges have been laid in the past with regard to the operation which the CBC seemed to be able to get inside of and take pictures? If no charges have been laid, can he explain why no such action has been taken in the Toronto area?


Hon. Francis Fox (Solicitor General):: As the hon. member knows, the RCMP is widely engaged in the fight against organized crime not only in Toronto but throughout Canada. The RCMP takes part in the fight against organized crime particularly through joint force operations which includes the joint use of all personnel and equipment against selected targets. This type of operation has led to charges being laid against numerous people believed to be involved in organized crime throughout the country. As far as the drug trade in particular is concerned, one of the main objectives of the RCMP is the fight against the importation of narcotics, particularly heavy drugs, and I think that just by day to day reading of their newspapers hon. members know the extent to
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which this type of work is carried on by the force. There are a number of ongoing investigations by the RCMP into the drug trade in all provinces but I am sure the hon. member does not wish me to divulge the type of investigations which are going on at the moment.


Stuart Malcolm Leggatt: I should like the Solicitor General to zero in on the question which was asked. He has given us a non-responsive answer. I asked him about one specific operation. Apparently the U.S. food and drug administration knew so much about it they were able to provide slides to their operatives showing the way in which Toronto was supplying illicit drugs to the world. The question I asked was this: Have any charges been laid by the Ontario authorities or by the RCMP with regard to that specific operation, or would the minister at least contact the CBC, without wire-tap help or any other help we know except their own investigative ability as to how they were able to receive so much information while no charges appear to have been laid by our own police force?


Francis Fox: I suppose the hon. member's question is also a plea in favour of the amendments presently before the House in Bill C-51 which seeks to provide to police forces of this country additional help in their investigations of this particular type of crime.


Some hon. Members:: Oh, oh!


Francis Fox: The hon. member referred to information which was provided to the CBC apparently by drug enforcement officials in the United States. We are continuously in touch with these people. As to the question of the laying of specific charges, I would want to check the present state of the affair before giving a specific answer.


Stuart Malcolm Leggatt: The Solicitor General refers to bugging powers. The police have this power, it was granted by this House in 1973. They had all the bugging powers they needed with regard to that operation. I am still interested in the question as to why no charges seem to have been developed, and the Solicitor General has not been responsive to that inquiry. Therefore, we had better ask ourselves whether additional powers are needed, considering we have already granted them. On June 9 the Solicitor General revealed-this deals with bugging by the RCMP-that he was filing an affidavit at the hearing in Edmonton before Mr. Justice Laycraft to prevent relevant evidence going before that inquiry on the grounds of national security, under section 41(2). Is the Solicitor General now willing to give an absolute commitment to the House that the affidavit did not relate in any way to bugging, illicit or otherwise, in relation to people involved in that inquiry?


Francis Fox: As to the first part of the question, the hon. member obviously feels it would be my job to determine why, when and at what stage the RCMP ought to lay charges in a case. It has not been my practice to interfere with the day to day operations of the RCMP but, rather, to let the RCMP develop the case, as a police force ought to do in a democratic

June 13, 1977
Oral Questions
society, and to lay charges when the relevant evidence has been brought forward. The hon. member, coming as he does from British Columbia, ought to know the extent to which wire-tapping is necessary in completing inquiries, particularly into the importation of hard drugs, into the province and the high rate of success the force has had in dealing with the problem as a result of these investigational aids. As to the question concerning the affidavit 1 filed in the Alberta inquiry, I filed one affidavit under section 41(2), having read the document myself, and it in no way relates to the inquiry presently being undertaken in that province.
I have signed a second affidavit, under section 41(1) of the Federal Court Act, which brings to the attention of the inquiry certain documents and leaves it up to the discretion of the court to decide whether or not those documents ought to be made public.

[ Translation]


SOCIAL SECURITY
Joseph Adrien Henri Lambert: Mr. Speaker, I would like to direct a question to the Minister of National Health and Welfare. He guessed it, because he is resuming his seat.


Hon. Marc Lalonde (Minister of National Health and Welfare):: I always guess.


Joseph Adrien Henri Lambert: The minister says that he always guesses. Here is my question: Since the Department of National Health and Welfare as well as the provincial ministers and health officials have been considering for a few years the possibility of establishing a guaranteed annual income plan-many documents have been sent to us on the matter- would the minister be in a position to tell the House whether all these studies and discussions which have taken place with the provinces will come to a head soon; will the minister introduce a bill to this effect in the near future?


Marc Lalonde: Mr. Speaker, a great many studies have been conducted with the provinces. During the last federal-provincial conference, all provinces approved this plan, except one, Ontario, which opposed the suggested formula. Since then, we have been examining various other possibilities for the development of a form of guaranteed income, especially for underprivileged workers.
These studies of other alternatives are not yet concluded; but 1 hope they will be this year. I am not in a position at this very moment to give the hon. member an assurance that a bill will be introduced in the House in the very near future.


Joseph Adrien Henri Lambert: I wish to ask a supplementary question, Mr. Speaker.

In view of the answer he just gave, could the minister indicate if a divided bill could be presented and adopted by the House concerning particularly the underprivileged workers, notwithstanding other sectors upon which the governments are disagreeing?


Marc Lalonde: Yes, Mr. Speaker, this is in fact one of the alternatives now being considered, that is the possibility to initiate a program concerning underprivileged workers.
Once again, I must say to the hon. member that he must not expect such a bill to be submitted in the coming months. I hope to table in the House, next week or even this week the new legislation on social services. This is the first priority that we will submit to the House, that is to say a great improvement of the cost sharing formula for social services in Canada. This legislation is a major step in the revision of social security and once again, I hope to be able to table it this week.


Joseph Adrien Henri Lambert: Mr. Speaker, I should like to put a supplementary. In view of the answer of the minister with regard to the lack of agreement on the part of the province of Ontario, can he tell the House whether there is agreement with the province of Quebec? If on the contrary there are difficulties what are they?


Marc Lalonde: Mr. Speaker, there was agreement with the Quebec government on the basic formula proposed in June of last year. Since then, 1 have not been advised to the contrary, I therefore presume that it still agrees with that formula. [English]


Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker,
I have one supplementary question in order to clarify the minister's timetable. Did I understand him to say, in terms of priority, that the social services legislation would be introduced next week? I would bring to the minister's attention that I am under the impression from the chairman of the Standing Committee on Health, Welfare and Social Affairs that amendments to the Canada Pension Plan will be introduced at committee stage on Wednesday, June 15. Can the minister clarify this position for me, so that we can be prepared? [Translation]


Marc Lalonde: With pleasure, Mr. Speaker. The amendments to the Canada Pension Plan will be studied by the standing committee this coming Wednesday, 1 believe, and we hope they will be passed by the House in the near future. As for the act on social services, it will be brought in for first reading this week, 1 hope.


ADMINISTRATION OF JUSTICE
[Stage Direction]
ALLEGATIONS MADE IN CBC DOCUMENTARY "CONNECTIONS" Miss Flora MacDonald (Kingston and the Islands): Mr. Speaker, my question is for the Minister of Justice. Given the startling revelations and allegations made in the CBC docu-
June 13, 1977
[Stage Direction]
mentary "Connections" last night, can the minister say when we can expect a statement by him as to the extent of organized crime in Canada? Could I ask him if he saw the program and, as a result, did he meet with his officials this morning to discuss what new initiatives might be taken to control these criminal abuses against Canadian society?
Hon. Ron Basford (Minister of Justice):: Mr. Speaker, I watched the program with a great deal of interest and would generally like to commend the CBC for bringing the matters of organized crime in this country to the attention of the public.


Some hon. Members:: Hear, hear!


Mr. Fairweather:: Is someone applauding the CBC? We had better have another inquiry.


Stanley Ronald Basford: However, a great deal of the program, as far as 1 could see, was taken from testimony obtained by wire-tap evidence in the Quebec crime inquiry. It is for that specific reason that attorneys general have been recommending for three years that the wire-tap laws of this country be changed so that they can deal more effectively with organized crime. With regard to the passage of the provisions of Bill C-51-


Some hon. Members:: Oh, oh!


Stanley Ronald Basford: -the most important initiative this parliament could take would be to pass those initiatives as quickly as possible.


John Allen Fraser: That is a cheap shot.


Walter David Baker: It does not wash.


John Allen Fraser: You do not know what you are talking about.


Stanley Ronald Basford: The hon. member for Vancouver South says that I do not know what I am talking about.


Walter David Baker: There is nothing wrong with your hearing.


Stanley Ronald Basford: I am quoting the annual reports from the ten provincial attorneys general, all of whom have recommended these kinds of provisions.


John Allen Fraser: When did you ever defend in a criminal court?


Miss MacDonald:: Mr. Speaker, I might say the minister's response is more by way of an excuse rather than to give an explanation as to what the federal government is doing at this time.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Donald Stovel Macdonald: Could 1 ask the minister to respond to the question I put to him originally, as to when we can expect* a statement from him about the extent of organized crime in
Oral Questions
Canada, or will he just depend on what is told him by provincial attorneys general?


Stanley Ronald Basford: Mr. Speaker, it would seem to me to be more useful, in dealing with organized crime, that we have legislation rather than statements.


Mr. W. C. Scott (Victoria-Haliburton):: Mr. Speaker, my supplementary question to the Solicitor General is this. Would he make recommendations to his colleague to view the second half of the program which will be shown tonight?


Stanley Ronald Basford: Mr. Speaker, I am not sure to whom that question was directed.


Charles Joseph Clark: Duck it anyway, Ron.


Stanley Ronald Basford: I certainly intend to watch the second version, and I would ask members of the House to do so, particularly members of the Standing Committee on Justice and Legal Affairs.


CONFLICT OF INTEREST
Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, my question is for the Minister of Agriculture. I should like to ask the hon. gentleman if he is now in a position to convey to the House any of the information requested by my colleague, the hon. member for Saskatoon-Biggar, with regard to the connections and activities of Senator Keith Davey or his company, York Sporting Investments, vis-a-vis Blue Water Racing Associates Ltd., incorporated on April 16, 1975, with the chief place of business in London, Ontario.


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, not a complete report, but I am sure one will be completed in a day or so. I know from the preliminary report that the so-called raceway operated, I believe, one year and lost $70,000.


Elmer MacIntosh MacKay: Mr. Speaker, the raceway is behaving like the government in this respect.


Some hon. Members:: Hear, hear!


Elmer MacIntosh MacKay: Mr. Speaker, since the Acting Prime Minister referred in his answer last Friday to the green paper in connection with conflict of interest problems in this matter, I should like to ask if he can indicate whether Senator Davey has been content with the perks of the Senate in so far as his dealings with the government of Canada are concerned, or whether the senator or any of his companies are involved in any business enterprises which are also deriving revenues from doing business with the government of Canada.

June 13, 1977
Oral Questions


Allan Joseph MacEachen: Mr. Speaker, I have no information on that subject.


ADMINISTRATION OF JUSTICE
Walter David Baker: Mr. Speaker, my question is for the Solicitor General of Canada. Is the Solicitor General aware that Ian Keith Carruthers of CMHC, one of the public servants who is alleged to have been named in the infamous letter by his paranoiac predecessor, has now issued a writ in the courts suing the present Solicitor General for libel and for negligence, and also joining in that suit the minister's predecessor, the Minister of Supply and Services? Is he aware of that, and has that writ been served upon him as yet? Furthermore, would he make himself available for service?


Francis Fox: Mr. Speaker, no writ has been served on me in connection with that. A few hon. members have been nice enough to forewarn me that that seems to be in process.


CRIMINAL CODE-POSSIBLE OBSTRUCTION OF JUSTICE BY GOVERNMENT MEMBERS OR EMPLOYEES RESPECTING BREAK-INS, ETC.
Mr. G. W. Baldwin (Peace River):: Mr. Speaker, I have a supplementary question for the Minister of Justice. Has the minister examined the provisions of the Criminal Code dealing with obstruction of justice and the jurisprudence under that section in order to see if members of the government at any level, or anyone with knowledge of such offences as break-ins, have done nothing and have not revealed the facts which were brought to their attention, in order to see if criminal charges could be brought against them? Has the minister examined that section, and if not, does he intend to do so?


Stanley Ronald Basford: Mr. Speaker, that section and its application have been examined with reference to the various instances in which a number of Crown officers either federal or provincial have been involved.


LABOUR CONDITIONS
Mr. Andy Hogan (Cape Breton-East Richmond):: Mr. Speaker, my question is directed to the Acting Prime Minister. The Sydney Steel Corporation has announced that it will close down its plant for five weeks commencing July 1. In view of the fact that unemployment in the area of the plant is running near 25 per cent, and in view of the fact that many of the

steelworkers will go two weeks without vacation pay or UIC benefits, will the cabinet instruct the CNR to buy and stockpile rails so that this shutdown does not have to occur?


Allan Joseph MacEachen: Mr. Speaker, the hon. member's question is in the nature of a representation, which we will consider.


CNR ACTION TO ALLEVIATE EMPLOYMENT SITUATION-DISCUSSIONS WITH SYSCO
Andrew Hogan: Mr. Speaker, my supplementary question is to the Minister of Transport. Since even steelworkers with 25 and 30 years' seniority at the plant will be affected because the company scheduled vacations earlier in the year so that too many vacations would not occur at the same time, will the Minister of Transport advise the House if he has requested the CNR to give special consideration to SYSCO to avert this situation?


Otto Emil Lang: Mr. Speaker, I have drawn the problems of SYSCO to the attention of Canadian National and I believe some discussions have been held. In addition, more discussions will be held to see what can be done. The Canadian National management is extremely sympathetic to the problem.


ADMINISTRATION OF JUSTICE
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker-


Some hon. Members:: Hear, hear!


John George Diefenbaker: I wish to direct a question either to the Solicitor General or to the Minister of Justice. I have listened to the various questions and answers in connection with the revelations last night, and I must say that I am perturbed by the indifference shown by both ministers.


Some hon. Members:: Shame.


John George Diefenbaker: Only recently it was said that Canada was a happy hunting-ground for international thugs. Having regard to recommendations made some years ago by Judge Macdonald and his commission in Windsor, and also having regard to the crime commission meetings in the province of Quebec which did a magnificent job, it is apparent that the problem has become overwhelmingly difficult for the government of Canada, and apparently for the ministers. Under the circumstances, and in order to clarify the whole situation, will the government appoint a royal commission, as recommended eight years ago and also as suggested by the Quebec commission, so that Canada will cease to be, among the western nations of the world, a country in which international wrong-
June 13, 1977

doers and criminals can carry on with a higher degree of impunity than they can in any other part of the world?


Stanley Ronald Basford: Mr. Speaker, I do not accept the right hon. gentleman's suggestion about indifference. We in this government have been concerned about organized crime for some time. We co-operated fully with the crime inquiry in the province of Quebec. The last round of Criminal Code amendments indicated that we were prepared to give statutory form to provincial crime inquiries, but as a result of the decision of the Supreme Court of Canada such amendments were unnecessary. It has been generally felt by law enforcement officials and others that such an inquiry is most effectively conducted by provincial attorneys general who have within their hands the administration and enforcement of the Criminal Code. The Quebec inquiry is an example of the type of action which is suggested. Contrary to indifference, no one on this side has made the kind of statement we heard on television last night. The hon. member for Northumberland-Durham has said that there is no organized crime in Ontario.


An hon. Member:: Don't be such a cheap politician.


An hon. Member:: That was five years ago.


Stanley Ronald Basford: It is as a result of the recommendations of and the consultations with the ten provincial attorneys general representing all parties in Canada that we proposed in this House changes in the wire-tap law. Law enforcement agencies across this country have said that they are hampered in dealing with the organizers of organized crime. Rather than looking for parliamentary pyrotechnics, I hope the right hon. gentleman will see that that legislation is passed.


Some hon. Members:: Hear, hear!


John George Diefenbaker: We have not listened to an example of pyrotechnics on the part of the minister; we have listened to the usual alibi that he adopts. Let us face the fact that international crime covers all of Canada and that the attorneys general have jurisdiction only within their provinces. I come back to this simple question: Will the minister follow the recommendations of two commissions and set up a royal commission so that wherever the wrongdoers are, they will not be concealed either directly or indirectly?


Mr. Speaker:: Order, please. The hon. member for York-Simcoe.


Walter David Baker: No answer.


John George Diefenbaker: The question should be faced.


Some hon. Members:: Oh, oh!


Stanley Ronald Basford: Mr. Speaker-


Charles Joseph Clark: You flushed him out.


Stanley Ronald Basford: The right hon. gentleman did not ask a question; he simply repeated a previous comment. I answered
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previously by saying that it is the advice of law enforcement officers that such an inquiry is best conducted at the provincial level by provincial attorneys general. I will be meeting with provincial attorneys general shortly. If they should make such recommendations, I will consider them. In the meantime, I am saying to the right hon. gentleman that it seems to be preferable to accept the advice of every law enforcement agency in this country and amend the Criminal Code in the way suggested by this government, so that the law enforcement agencies of Canada can more effectively deal with organized crime.


John George Diefenbaker: Is the minister covering up?


Some hon. Members:: Oh, oh!


An hon. Member:: Go back to London.


CBC TELEVISION PROGRAM ON ORGANIZED CRIME-GOVERNMENT REACTION
Mr.  R. Gordon L. Fairweather@Fundy-Royal: Mr. Speaker, would the Minister of Justice address himself to the fact that several aspects of last night's film dealt with areas which are clearly of federal responsibility-loan-sharking, the whole aspect of narcotics control, and so on-and that the wire-tapping provisions the minister so highly recommends to us have been found unacceptable in the United States, and yet in the United States they have been able to deal with these issues more forthrightly than this government?


Stanley Ronald Basford: Mr. Speaker, it appears that part of the hon. gentleman's question is correct. On the basis of various reports, including that of the Quebec crime inquiry and the work of CLEU in British Columbia, it seems that loan-sharking is increasingly becoming a front-end operation of organized crime. It is for that reason that sections 3 and 20 of the Small Loans Act are included in the wire-tap amendments which are now before parliament.


Walter David Baker: Your only answer is wire-tapping.


FINANCE
Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, my question is for the Minister of Finance. With the United States reporting last week its lowest unemployment in 30 months, while Canada has its highest in 37 years, and with inflation continuing to be higher here than in the United States, is the minister in a position today to confirm the finding in OECD material to be released later this month in Paris indicating that worse is in store for Canada, with real growth expected to be below 4 per cent and with high inflation and deficits persisting well into 1978?

June 13, 1977
Oral Questions


Donald Stovel Macdonald: Mr. Speaker, as the story from which the hon. gentleman has quoted indicated, that material will not be released to us until later this month.


John Allen Fraser: That's pretty good.


Sinclair McKnight Stevens: Mr. Speaker, as the OECD figures indicate that a further 75,000 Canadians will be added to the one million out of work already during this year and next, maintaining our lead as the number one OECD major country for unemployment, would the minister indicate if this project is enough to cause him to change his budgetary stance and allow a personal income tax cut in this country which could be afforded if there was more government restraint?


Donald Stovel Macdonald: Mr. Speaker, as I pointed out to the hon. gentleman, the figures that that reporter has referred to have not yet been made public. Considering the past performance of that particular reporter, I caution all hon. members to consider with care any of his reports in this regard. I will be participating at the OECD meeting and we will be glad to pursue with OECD officials the analysis, not only for Canada but also for the other OECD member countries.
With respect to the concept of the tax cut, 1 find the hon. gentleman's representation a little hard to understand, since he voted against one just a few weeks ago.


GOVERNMENT BOND ISSUE-EFFECT ON INFLATION
Sinclair McKnight Stevens: Mr. Speaker, another question to the Minister of Finance. In view of the data released today regarding the $1 billion fresh bond issue put out by the government of Canada, would the minister indicate if he feels it is inflationary or not that the Bank of Canada, which institution is responsible to him, has purchased a net $178 million of that issue which would appear to be monetizing the debt still further?


Donald Stovel Macdonald: The hon. gentleman really plays both sides of the river. At one point he is critical of the government for not taking reflationary steps, for example by running a higher deficit, and the next minute he is insisting we should cut it down. I wish he would get his stories straight one way or the other.


Sinclair McKnight Stevens: You will not get away with that, Donald.


NEWFOUNDLAND-HYDROELECTRIC POWER-GOVERNMENT POLICY
Mr. John C. Crosbie (St. John's West):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources.
(Mr. Stevens.)
The Secretary of State for External Affairs last Monday made a speech in St. John's, Newfoundland, in which he said that the federal government had presented to Newfoundland a "comprehensive package" to develop the hydro power potential of Labrador as a "number one priority" in helping to solve Canada's energy crisis. I ask the minister whether such a comprehensive package has been presented to the government of Newfoundland, and what are the elements of that package? Does it include financing of transmission lines and hydro site work, loans or grants for payment of equity, and does the minister agree that this is a number one priority of the government of Canada?


Hon. Alastair Gillespie (Minister of Energy, Mines and Resources):: The principles of the package of benefits and development of generation and transmission of power with respect to Gull Island and with respect to the hydro resources in Newfoundland and Labrador were discussed with the premier and his delegation. At that time it was agreed he would have work done which would be presented to us so that we could take the particular discussion a step further.


John Carnell Crosbie: The statement of the Secretary of State for External Affairs, a senior cabinet minister, is that a comprehensive package to develop the hydro power of Labrador has been presented to the government of Newfoundland. The minister of mines and energy of Newfoundland has said that no comprehensive package for the development of Labrador hydroelectric power has been presented to the province by Ottawa. Does the hon. gentleman agree that the Newfoundland minister is correct, that no comprehensive package has been developed, and that his colleague the Secretary of State for External Affairs has misled the public of Newfoundland by the statement he made?


Mr. Speaker:: Order, please.


INQUIRY OF THE MINISTRY
John Allen Fraser: Mr. Speaker, I have a question for the Acting Prime Minister. Can the Acting Prime Minister advise the House of the approximate date of the return of the Minister of Supply and Services, keeping in mind that there are a number of questions which hon. members would no doubt wish to ask that minister? We would not want to be left in the position of thinking that perhaps the minister's visit to another continent would last beyond the expiration of this session.


Allan Joseph MacEachen: I am
sure the Minister of Supply and Services will appreciate the hon. member's desire to have him back in Ottawa. I think he will be back at the end of the week.
June 13, 1977


ENVIRONMENTAL AFFAIRS
Mr. Bob Brisco (Kootenay West):: My question is for the Minister of Fisheries and the Environment, to whom I have given notice. In view of the fact that the inland water directorate of the ministry of the environment bears certain responsibilities for the proper conduct of the Columbia River treaty, is the minister aware of the seemingly irresponsible actions of B.C. Hydro in its control of the lake levels on the upper Arrow Lake which have destroyed the beaches of Nakusp, ruined its tourist industry and created massive mud flats which have now, with the prevailing winds, become enormous dust bowls?


Hon. Romeo LeBlanc (Minister of Fisheries and the Environment):: I thank the hon. member for his courtesy in advising me of his intention to ask this question. The question requires an answer in two parts: first, the responsibility of this department and, second, why the upper Arrow Lake is so low. With regard to the first part of the question, under the 1964 Columbia River treaty, B.C. Hydro has been designated as the Canadian entity for the operation of the resource reservoirs in Canada. The Columbia River treaty permanent engineering board is responsible for ensuring that B.C. Hydro's operations are consistent with Canada's international responsibility under the treaty. The inland water directorate of this department provides technical and engineering support to the engineering board.
On the second question regarding the low levels on the upper Arrow Lake, this is due to the very low run-off in southern British Columbia this year because of low winter snow-packs and early spring drought conditions which extended from western Ontario across the prairies to southern B.C. The upper Arrow Lake is a little higher at this time of the year than the low level experienced in 1973, but the situation is still serious.


Robert Hylton Brisco: I thank the minister for his response. I am aware that the snow-packs are unusually low this year, but this has not been reflected in the levels of Kootenay Lake, controlled by 1JC. Therefore, 1 would ask the minister if he is prepared to take action with reference to the interpretation of the Columbia River treaty, and whether perhaps he is considering, or would consider, the possible reopening of the Columbia River treaty to better protect Canadian interests in this regard.


Roméo LeBlanc: Mr. Speaker, I will certainly endeavour to take whatever action we have legal authority to take. As for the suggestion of the hon. member, that is not the sort of thing I would answer "a brule-pour-point", as we say in French. I would want to take a look at all the facts.
Oral Questions INDUSTRY


TRANSFER OF WESTINGHOUSE, U.S.A., TO WHITE INDUSTRIES
Mr. Max Saltsman (Waterloo-Cambridge):: Mr. Speaker, 1 should like to direct my question to the Minister of Industry, Trade and Commerce. It relates to the decision by Westing-house, U.S.A. to transfer the rights to its name to White Industries rather than CAMCO industries. In view of the fact that the government has been concerned with establishing more Canadian production facilities and a greater rationalization of the appliance industry, and for that purpose has been encouraging the new company, CAMCO, may 1 ask the minister whether he intends to intervene in this trademark decision or, alternatively, because of the importance of trademarks in regard to Canadian ownership, does he intend to empower FIRA to deal with this critical issue which impedes transfers from foreign to Canadian operations?


Hon. Jean Chretien (Minister of Industry, Trade and Commerce):: Mr. Speaker, we are dealing here with an extremely complex problem, the trade marks issue, and unfortunately it does not look as if I have the power to take any action at this point, since it is considered as a perfectly legal transaction under the present law that Westinghouse sells the right to its name to White Industries. However, we are considering the situation to see whether it might be appropriate to amend our legislation to avoid such a situation in the future.


Max Saltsman: Mr. Speaker, as an indication of the seriousness of this matter, and since the minister has indicated that he is going to study some amendments, may I ask when he will be in a position to announce those amendments or inform the House in this regard?


Joseph Jacques Jean Chrétien: Mr. Speaker, I do not know when we will be able to make an announcement about these amendments, if there is going to be any. I can only tell the House how concerned I am about this kind of problem which is somewhat changing the trade practice and tradition in Canada.


TRANSPORT
Mr. James A. McGrath (St. John's East):: Mr. Speaker, I have a question for the Minister of Transport which arises out of the very serious charges made by the Parliamentary Secretary to the Minister of National Revenue regarding the sinking of the CN ship the William Carson, whereby the hon. gentleman claimed that the present deployment of icebreakers is scandalous and that the sinking of the William Carson is an

June 13, 1977
Oral Questions
example of this deficiency. That is a serious charge, made over a week ago, so I ask the minister if it is his intention to order a judicial inquiry into the circumstances surrounding this sinking.


Otto Emil Lang: Mr. Speaker, I need not say that 1 do not agree with the words quoted by the hon. member, however much I respect their source and his conveying them. I will say, however, that it is our intention to proceed with the recommendation for a judicial inquiry.


SINKING OF &quot;WILLIAM CARSON&quot;-COMPENSATION TO PASSENGERS AND CREW
James Aloysius McGrath: A supplementary question. Is the minister prepared, on behalf of Canadian National, to tell the House if a decision has been made by the company with regard to compensation to the passengers and crew for the belongings they lost through that sinking?


Otto Emil Lang: Mr. Speaker, unfortunately it is not possible to make a complete statement of the situation at this time. I understand the Canadian National is attempting to deal with individual passengers in relation to their personal belongings, but that some rather more complex questions arise in relation to freight and general cargo that involve legal claims and insurance liability. It may take a while to sort out these matters.


Mr. Speaker:: Order, please. The hon. member for Davenport rises on a question of privilege.


PRIVILEGE
Mr.   Chas. L. Caccia@Davenport: Mr. Speaker, last night, in a program entitled "Connections", reference was made to representations made by me on behalf of a young constituent of mine, an inmate of Millhaven penitentiary. This morning I went through my file on this young man. I have with me copies of letters I have written to the Solicitor General about this case since 1973. I am seeking, now, the permission of this House to have this correspondence printed and appended to today's Hansard. Mr. Speaker, I believe that by making these letters public, the record would be set straight.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Order, please. As much as the hon. member's suggestion is most worthy in support of the proposition he puts forward and in support of his quite legitimate representations on the matter, it is entirely a departure from our practice to extend to members, even with the consent of the House, the authority to table or append documents to Hansard. That authority rests with ministers, although not always even with them unless the matter falls within their administrative competence.
With respect, I very much fear that despite the very legitimate reasons for this particular request there would be a very

grave danger if-even with the consent of the House-a member was entitled to table or append documents to Hansard. Requests to do so would, naturally, increase considerably. I have to take this decision myself. Rather than putting that responsibility, which is a difficult one, upon the House, for I am sure in this particular circumstance no hon. member would want to withhold consent, and rather than putting that extension of our practice upon the House on this occasion, which would invite similar extensions to other members in the future, it seems to me I should, rather, invite the hon. member to make available copies of his correspondence which I am sure explains and supports his position.
We would be happy to arrange for distribution of these through the distribution system of the House of Commons as he desires, and to the press gallery and members of the press including, of course, the CBC which is involved. We will put at his disposal, as we would with any member, whatever services we have to make this distribution effective and immediate. I do not think, however, that I ought to put to the House the choice of extending our practices by appending this correspondence to Hansard or printing in Hansard as if it has been read.


MR. LAWRENCE-CBC PROGRAM ON ORGANIZED CRIME
Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, I rise, regretfully, on a question of privilege arising out of the very worth-while and well-intentioned CBC television expose of internationally organized crime in Canada. I do so at this time mainly because of the reference to this matter by the Minister of Justice (Mr. Basford) and to certain purported remarks of mine as broadcast on that program. I rise regretfully because, as I have informed you, Mr. Speaker,
I have attempted and am still attempting to get certain information from the Canadian Broadcasting Corporation respecting the transcript or the full screening of the old interview they showed last night. I may say I think it is a question of privilege because to my mind it certainly damaged me personally and damaged my effectiveness in this House as a member of parliament. I therefore believe it is a matter of privilege for the House.
First of all, may I say that for all my adult political life I have attempted to fight and expose this human scum, this element in Canada of internationally organized crime, as much as if not more than most other hon. members, because in another jurisdiction I have had the opportunity to attempt to do exactly that.


Some hon. Members:: Hear, hear!


Allan Frederick Lawrence: I believe the minister's impression of what he heard last night is shared not only by members of the House but also by many people in this country. I am sure he believes he heard me say that there was no internationally organized crime in this country, in this province or indeed, in metropolitan Toronto. Of course, that is exactly opposite to the impression I attempted to give in the statement I made which was filmed in early 1972 by the CBC and other media in this
June 13, 1977

country. It was exactly the opposite because at that time, prior to the death of Magaddino in Buffalo, and certainly long after the New York family had well established itself in Montreal and had been extending its control and jurisdiction into the French-speaking areas of the province of Ontario, 1 was attempting to use that office at that time to impress upon the law enforcement agencies, the government of which I was a member, other governments and the people of this country and especially southern Ontario, that many elements of crime were already under United States influence, internationally organized crime.
That film clip that you saw last night on the CBC was a very small segment of a larger statement that I made at that time. The longer statement was to the effect that internationally organized crime was well established in Canada and in Ontario at that time. I also indicated, in that statement, certain moves, certain procedures and certain governmental organization at both the federal and provincial levels that 1 thought should be taken to cure this sickness that we had then, and still have, in this country.
1 feel that even though 1 have asked the CBC to screen the whole of that statement or at least to give me the transcript of that statement-and so far they have not been able to do that-nevertheless, that small film clip last night was taken far out of context and damaged me to the extent that if they do not provide me with that full statement I may have to take the matter up outside the jurisdiction of this House by proceeding on other grounds. I shall obtain legal advice in that respect. 1 feel that program damaged my reputation so much that it affects my capabilities in this House. 1 would, therefore, like to move, if 1 may, that the matter of the reference in that CBC program last night as it pertained to me be referred to the Standing Committee on Privileges and Elections so that 1 may have an opportunity of clearing what I think is the very great stigma that attaches to my reputation and to my name.


Some hon. Members:: Hear, hear!


Stanley Ronald Basford: Mr. Speaker, 1 rise on the same question of privilege. The hon. member, in raising the matter of the CBC, made reference to my use of the CBC clip. Obviously, that was the only information before me and before the others. He has in this House given a full explanation of his position on that matter, which I accept unreservedly.


Mr. Speaker:: Order, please. The questions of privilege raised by the hon. member for Davenport (Mr. Caccia) and the hon. member for Northumberland-Durham (Mr. Lawrence) raise, again, the question of the relationship between membership in the House of Commons and the press, and a further, more complex and additional relationship, that of a question of privilege respecting the proceedings of the House and the right of members in regard to the special relationship among members of the House and the freedom of the press
Electoral Boundaries
generally. We have now in abeyance, under my considered study, two other questions relating to the same problem. In respect of both I will, as I will in respect of this matter, attempt to render a decision tomorrow afternoon.



ROUTINE PROCEEDINGS


Donald Stovel Macdonald: Mr. Speaker, in accordance with Standing Order 60, I wish to table two notices of ways and means motions and also request that you designate the requisite order of the day for the purposes of considering those motions at the next sitting of the House.


ELECTORAL BOUNDARIES READJUSTMENT ACT
Mr. J. Larry Condon (Middlesex-London-Lambton) moved: for leave to introduce Bill C-422, respecting the Electoral Boundaries Readjustment Act.


An hon. Member:: Explain.


Joseph Lawrence (Larry) Condon: Mr. Speaker, I present this bill to the House because of certain changes to be made to the new riding and representations for changing its boundaries. These would change the riding from one which is partially rural in make-up to one which encompasses a large part of the city of London. For that reason I bring this bill forward in the House.


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

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Ralph Goodale: Mr. Speaker, the following questions will be answered today: Nos. 1,974, 2,076, 2,175, 2,382 and 2,469.

June 13, 1977
Order Paper Questions


Mr. Allard: 1.	(a) What are the names of the members of the Unemployement Insurance Commission Arbitration Board who, since 1970, have held office in Rimouski as
(i)	president (ii) representative of the employer (iii) representative of the employees (b) what was the duration of their terms of office (c) what were their qualifications (d) how were they appointed to the various offices (e) how much was each one paid for each session of the Arbitration Board (f) in all, how much did each one receive during his term of office in salary and other compensations?
2.	(a) Since 1970, how many people lodged an appeal before the Arbitration Board and, of these, how many were (i) women (ii) men (b) how many hearings were in (i) French (ii) English (c) what number were (i) represented (ii) not represented (d) how many such persons personally appeared (e) as a percentage, how many of these did the Unemployment Insurance Commission offer to be represented (f) in how many cases did the claimants win (g) in how many cases was the decision (i) unanimous (ii) other (h) among all the cases heard by the Rimouski Arbitration Board, how many persons availed themselves of their right to appeal before the Judge Arbitrator (i) how many requests were made to the President of the Arbitration Board for authorization to appeal to the Judge Arbitrator, when the decision of the Commission's employee was maintained by the Arbitration Board by a (i) unanimous (ii) divided decision (j) how many of such requests to appeal before the Judge Arbitrator were approved (k) as a percentage, how many requests of appeal to the Judge Arbitrator were decided in favour of the appealing party (1) what were the litigious questions most often referred to the (i) Arbitration Board (ii) Judge Arbitrator (m) on which sections of the Unemployment Insurance Act and Regulations was the disqualification of claimants generally based (n) were requests submitted to the effect that the hearings of the Arbitration Board and the Judge Arbitrator should be recorded (o) what is the average duration of a hearing before the (i) Arbitration Board
(ii)	Judge Arbitrator?
3.	(a) What was the average level of education of the appellants (b) as a percentage, how many appellants were (i) 60 to 65 (ii) 55 to 59 (iii) 50 to 54 (iv) 45 to 49 (v) 40 to 44 (vi) 35 to 39 (vii) 30 to 34 (viii) 25 to 29 (ix) 20 to 24 (x) less than 20 years of age?


Hon. Bud Cullen (Minister of Manpower and Immigration):: 1.	(a) (i) M. Tessier; R. Berube; C. Gareau; A. Roy Dube; G. Hamilton, (ii) C. Gauthier; E. Paradis; H. Labrie; C. Chevalier. (iii) A. Bestraze; B. Lepage; J. Caron; M. Parent; J. Levesque, (b) Chairmen: M. Tessier-August, 1970 to August, 1976; R. Berube-March, 1973 to July, 1973; C. Gareau-December, 1973 to the present time; A. Roy Dube- July, 1976 to the present time; G. Hamilton-October, 1976 to the present time. Employer representatives: C. Gauthier- March, 1974 to the present time; E. Paradis-July, 1973 to the present time; H. Labrie-December, 1969 to the present time; C. Chevalier-December, 1973 to October, 1975. Employee representatives: A. Bestraze-October, 1963 to the present time; B. Lepage-October, 1963 to the present time; J. Caron-March, 1972 to November, 1976; M. Parent-February, 1974 to January, 1977; J. Levesque-March, 1974 to the present time, (c) The Chairmen and members of boards of referees must meet the criteria established by the commission, i.e. demonstrated ability (work experience and qualificiations) to evaluate evidence, control and direct the board's operations, dictate and write decisions and understand and interpret the Unemployment Insurance Act and Regulations. They must thus occupy a certain social position within the community and be reasonably well-known and respected. In addition, the chairman must have a good knowledge of hiring techniques and the labour market situation while remaining unbiased in his decisions, (d) Chairmen of boards of referees are appointed

by the Governor in Council. The commission draws up lists of employers and their representatives as well as of insured persons and their representatives. Members of boards of referees are selected in the manner prescribed from these lists and appointed by the commission.
	Chairman	Members
1970	1 day $70 Vi day 40	1 day $50 Vi day 301972	1 day $85 Vi day 50	1 day $65 Vi day 401974	1 day $100 'h day 60	1 day $80 'h day 501976	1 day $110 Vi day 60	1 day $90 Vi day 50(f) In all, the amounts paid to Boards of Referee members were: 1970-$5,645.40 (April, 1970-March, 1971); 1971 - $2,440.00 (April-December, 1971); 1972-$5,111.14; 1973- $11,670.00;	1974-$8,728.50; 1975-$7,548.50;	1976-


[Stage Direction]
2.	(a) 1970, 259; 1971, 220; 1972, 214; 1973, 609; 1974, 383; 1975, 247; 1976, 324. (i), (ii) not available, (b), (c), (d) and (e)-not available, (f) 1970, 66; 1971, 50; 1972, 43; 1973, 129; 1974, 50; 1975, 49; 1976, 53. (g), (h), (j), (k), (1), (m), (n) and (o)-not available.
3.	Not available.
Mr. Howie: 1.	Have government studies been published regarding the effects of propellant gasses used in aerosol sprays and, if so, what was the finding in each case?
2.	Have measures been taken to control, limit or prohibit the sale of products using propellant gasses and, if so, what are they?


Ralph Goodale: In so far as the Department of the Environment is concerned: 1. Yes. The report by the Atmospheric Environment Service Advisory Committee on Stratospheric Pollution, dealing with the effect of chlorofluorocarbons on the ozone layer, was tabled in the House of Commons in December 1976. The report concludes that "the scientific evidence is sufficiently strong to warrant the government making a decision on regulation of chlorofluorocarbons" and that "if scientific evidence were the only copsideration, the committee would recommend immediate regulations to achieve a significant reduction in fluorocarbon release rates".
2. The minister announced in December that the government will move immediately to phase down the use of fluorocarbons F 11 and 12 in Canada. Industry has begun voluntarily to reduce by one half the consumption of F 11 and 12 in the aerosol industry. Regulations will be developed which would prohibit non-essential uses of F 11 and 12 in aerosol products in 1978.
June 13, 1977

Order Paper Questions
In so far as the Department of National Health and Welfare is concerned: 1. Results of a study carried out for the Health Protection Branch by a consulting laboratory indicated no adverse effects to housewives using a large number of aerosol products for a period of six weeks. These results were published in the Canadian Medical Association Journal in July 1974.
2. An interdepartmental ad hoc group of experts is studying all facets of aerosol products containing F 11 and F 12 fluorocarbons. Industry has agreed to decrease by one-half their usage of such materials during 1977, and all but essential uses of fluorocarbons as aerosol propellants will be phased out by December 1978.


Mr. Stevens: As of December 31 (a) 1968 (b) 1976, what was the number of federal employees engaged to inspect coal mines?


Ralph Goodale: In so far as the Department of Indian Affairs and Northern Development is concerned: (a) Nil. (b) 3.
In so far as the Department of Labour is concerned: (a) Mine inspections were carried out for Labour Canada under contract with department of mines of Nova Scotia, (b) Four federal government employees were engaged in inspection of coal mines of Cape Breton Development Corporation. In addition, there were: one chief inspector, one laboratory technician and two support employees. Notwithstanding the above reply, most mining activities in Canada are within provincial jurisdiction.


Mr. Fortin: Did Mr. Gabriel Beland, Director General of the Department of Manpower and Immigration, in the Quebec area, tell some close associates that he had to1 get rid of the UIC workers' union president for the Quebec Chapter, Mr. Robert Goyette, because the latter was a dangerous revolutionary?


Jack Sydney George (Bud) Cullen: No.


Mr. Caccia: How many immigrants, whose last or second last country of residence was Angola, have arrived in Canada since 1974?


Jack Sydney George (Bud) Cullen: One thousand ninety five immigrants, whose country of last permanent residence was Angola, have arrived in Canada since 1974. Statistics are not kept on the second last country of residence of immigrants.


Ralph Goodale: Mr. Speaker, if question No. 2481 could be made an order for return, this return would be tabled immediately.


Mr. Gauthier (Roberval): 1.	Since November 15, 1976, have any companies moved their head office out of Quebec and, if so (a) how many (b) to which locations (c) what are (i) the names of the companies (ii) their assets (d) how many Quebec residents did they employ (e) on what date were they established in Quebec?
2.	Since November 15, 1976, have any companies moved to Quebec and, if so (a) how many (b) what are (i) the names of the companies (ii) their assets (c) how many employees do they have (d) from which locations?
Return tabled.


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


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


Some hon. Members:: Agreed.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Speaker:: Order, please. I almost overlooked announcing the questions to be raised during this evening's adjournment debate. Pursuant to the revised procedure for the month of June, I wish to inform the House that the questions to be raised at six o'clock p.m. are as follows: the hon. member for Halton (Mr. Philbrook)-Transport-Date of decision on provision of funds for urban transit projects; the hon. member for Lambton-Kent (Mr. Holmes)-Northern Affairs-Northwest Territories-Involvement of local government in programs to develop political awareness of natives-Government position; the hon. member for Marquette (Mr. Stewart)- Transport-Rail line abandonment recommended by Hall commission-Inquiry as to form of appeal available.
6588

June 13, 1977
Aeronautics Act



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Lang that Bill C-40, to amend the Aeronautics Act, be read the second time and referred to the Standing Committee on Transport and Communications.
William James Kempling: Mr. Speaker, when the House rose at one o'clock I had been quoting an excellent letter written by a constituent, an aviation consultant. So excellent was the letter and so much on point that I felt impelled to read it into the record. I shall continue reading, as follows:
Subsection 3 would provide that all charges imposed upon the owners or operators (pilots) of aircraft would constitute a lien upon the aircraft in respect of which charges have been incurred and may be collected by the seizure and sale of the aircraft under a warrant or order of the federal court.
I am pleased to see that the minister finally has realized that this country still has courts of law. Notwithstanding, legislation incorporating this proposed amendment would give Transport Canada horrendous power. During the past several years, the number of erroneously-charged landing fee charges which many pilots have received is appalling, many of which have been due to incorrect registrations being recorded. What protection does the owner/operator/pilot have in such cases? Absolutely none. There isn't even stipulated processes for appeal. No, you can just see it coming: an owner/operator/pilot fails to pay his $1.50 landing fee, the RCMP seize the aircraft concerned and in the process damage it, an experience which many complain of today with the problems caused by legislated faulty ELT's, and place the aircraft up for auction. The owner attempts to rectify the situation when it turns out that the charge was wrongly made, but his only recourse at that point is through the courts, at his own expense. Our convicted criminals seem to enjoy more rights than that.
At the present time, there are due processes of law concerning the establishment of liens against chattels to which all Canadian citizens and corporations must adhere. I suggest that the government may not be allowed to set itself up as a law unto itself. Rather, this subsection 3 should not be permitted.
Subsection 4 would allow for the automatic attraction of interest at the rate of one and one-half per cent per month, calculated from the day that is one month after the date on which the charges were imposed.
Notwithstanding the automatic contractual obligations to which owners/oper-ators/pilots would be subscribing to under this proposed legislation should they make use of any DOT facilities for which a user-charge is associated-the legality of which may have to be contested in the courts-what happens to all of the securities deposited with the minister as set out in subsection 2? Is the minister prepared to pay each owner/operator/pilot monthly interest at the same rate on the deposit? And what about the administrative requirements to handle these matters? What is the additional cost that will ultimately be passed along as another user-charge to establish offices across the country to keep track of every deposit, every user-charge, every lien, the cancellation of each lien as the accounts are settled, and the processing of seizure and sale of the hundreds of aircraft? One more excuse to further the government's self-indulgence and self-justification.
Next we come, on page 2, to section 5.2 which would permit the establishment of regulations that would require private aircraft owners and operators (pilots)

to subscribe for and carry liability insurance. I certainly agree that third party liability insurance is a very important and common-sense thing for owners/oper-ators/pilots to have, but I would be very interested in the numbers of such owners/operators/pilots who do not now have such coverage. I suggest that it would be an extremely small percentage of persons, and therefore, Transport Canada should be required, firstly, to substantiate this proposed legislation with factual evidence, including full details about accidents and insurance statistics that might support the minister's claim. And, what kind of level of insurance would we be talking about here? Enough to cover the claims if an accident occurred between a private aircraft and a 747?
You know, on our navigable waterways, lakes and rivers, you see kids and irresponsible adults-a vast majority of whom have never had any instruction in small boat handling-playing the fool with high-powered single and twin-engine inboards and outboards. Most of them do not even know and do not care about the rules of the road. What about their liability? Federal jurisdiction prevails there, too, but you do not have to bother answering that question because we all know what the answer would be. The small boat manufacturers and operators is such a large group of voters which the government doesn't want to lose, just like the case two years ago with the then new 10 per cent excise tax. Hit the aircraft owners, but exempt the boats because the latter's lobby is too strong. Heck, it's the private aircraft which can and is providing the alternative viable form of fast and economical transportation, not the small boats.
Further, on page 2, under paragraph 4, reference is made to the proposed licensing of persons engaged in the design of aircraft and the premises in which that design takes place. Every community college and university in this country with an approved engineering technology or undergraduate or graduate course might well be considered to come under such legislation. What about the innovative inventor? Before he even starts to "design" from his ideas, must he apply for a licence first? Of course not, but some over-reactive official is sure to come along one day and then what? Later in this section, you will also find reference to proposed licensing requirements for premises used in the maintenance of aeronautical products for the purpose of determining the airworthiness of such products. The law already prescribes for the licensing standards of maintenance/engineering personnel, but is it now going to be that a farmer must license his barn in which he hangars his Piper J-3 in order that routine maintenance work may be carried out on his aircraft on his premises by an already-licensed engineer? A little absurd, perhaps, but that is what might well take place under proposed amendment.
Despite the obvious new restrictions and legislative controls that these proposed amendments would put into effect, it is amazing that nowhere does the Bill C-40 provide for a route of appeal. If a citizen does not like a decision or action which may have been taken against him arbitrarily, to whom does he appeal? The current sad situation with respect to medicals is a prime example. Do we always have to resort to the Federal Court of Appeal Act under section 28 with all of its associated expense? If so, then rest assured, the aviation community is sick and tired of having new and more expensive legislations rammed down its throat, and the moment that we can find just cause under any implied contract which may be deemed to exist if this Bill goes through, we will consider every possible recourse of action, including the initiation of class action suits.
On pages 5 through 9, you will find amendments proposed in respect of the jurisdiction over protection of areas adjacent to airports. Some of these articles may be considered worthwhile, and although I have not sufficient background that allows me to comment vis-a-vis the provincial and municipal jurisdictions in these matters, this part should be examined carefully because finally, we may get some common sense zoning regulations for lands and buildings located around airports.
Following these matters, on page 9, we find the long-awaited reference to the board of inquiry! Regrettably, despite the grammatical change, there is really no change. When are we going to get an independent and proper board of inquiry for aircraft accidents that will not be tied to the apronstrings of the Ministry of Transport, oftentimes susceptible to Transport Canada influence? This is long overdue, and the proposed amendment here accomplishes nothing but a little housecleaning.
Mr. Kempling, this proposed legislation under Bill C-40 has too many items in it of contentious issue, items that would provide Transport Canada with increased, autonomous powers that may not be used to further and promote the growth of aviation in this country. I request that you, as my representative in Ottawa, do everything to see that it is defeated.
Thank you for consideration of these matters.
June 13, 1977

I thank the House for its indulgence in allowing me to read that letter into the record. If hon. members have an opportunity to reread it tomorrow, they will see that many of the points contained in the letter are valid and should be considered. We want this bill referred to a committee. We want witnesses called to deal with the areas of concern about which many members have spoken. Those in the aviation industry who wish to present briefs and make representations should be permitted to appear before the committee.
I understand that difficulties have been experienced with four air carriers with regard to the collection of fees for services. The minister's solution to this seems to be to require all pilots and owners of aircraft to fall under the umbrella of these charges even though the difficulty was only experienced with four air carriers. That is most regrettable. It is a further example of overkill and will have an extremely detrimental effect on aviation in Canada.
There are other members who wish to speak on this bill and bring forward other points of interest. I will yield the floor to them at this time. I just want to state that when this matter comes before the committee, as I am sure it will, we will be adamant with regard to having witnesses and briefs presented from those in the aviation industry who will be affected by this bill. We will endeavour to amend it and change it in such a way that it will not be detrimental to the Canadian aviation industry. If left in its present form, I am afraid it will have a rough passage.
[ Translation]


Mr. Alexandre Cyr (Parliamentary Secretary to Minister of Public Works):: Mr. Speaker, 1 welcome this opportunity to speak on second reading of Bill C-40, a bill which gives to the minister and his officials much greater powers to improve regional air services, such as Montreal-Mirabel, but 1 must say that very few clauses in this bill promote the establishment of airports in remote areas like the Gaspe peninsula, northern Ontario and Quebec.
Mr. Speaker, the proposed amendments contained in this bill give much more power to the minister and his officials to give a negative answer to realistic projects that may come from some municipalities. The current situation of runways in the Gaspe peninsula does not allow for an adequate service. The length of runways and the lack of sufficient navigation aids result in many delays and flight cancellations in Gaspe and Sainte-Anne-des-Monts as well. The regional air carrier for Gaspe, Quebecair, had to cancel 12 per cent of its flights in 1976 because of bad weather conditions.
Since 1974, Department of Transport officials and even ministers have been stating that the federal government will provide for the financing of the 6,000-foot extension of the runway in Gaspe and that this runway will be provided with facilities and with better navigational aids. In 1977, the same officials of the Department of Transport say that according to the existing regulations, the present site does not meet the security standards for navigation and that after having invested $1.5 million for building an airport and an air terminal we should try to find another site.
Aeronautics Act
Mr. Speaker, I believe that the Department of Transport is perhaps the only one among all departments here in Ottawa which is so independent that it can see to its own operations without consulting people or experts from outside. The department submits regulations, has them passed by Parliament, applies these regulations and no independent body has in any way the right to interfere in their files. In one word, as the scouts said before, this department is taboo.
The Chamber of Commerce of Gaspe, in a brief presented on April 1977, states this, and I shall quote a few parts from it:
Following the representations which have been made for the last six years for a 6,000-foot extension to the runway in Gaspe airport, it appears to us necessary to inform the Minister of Transport of the results of some research and to formulate once again our requests.
We will give you first some data on the previous studies on the establishment of an airport in Gaspe. We will then give you the results of the test flights which have been made to check the conditions of air navigation in the immediate vicinity of the present runway. Finally we will formulate our requests for the immediate future.
In its previous studies, the Gaspe Chamber of Commerce states that the plans were accepted in 1952. Other plans were also developed and signed by the department; the land survey took place in 1965. Moreover, an expropriation plan and a development plan were set up in 1965 and 1969 respectively.
The brief states further:
What is to be inferred from these works?
We cannot resign ourselves to admitting that federal Department of Transport engineers approved these development and construction plans for an airport without making use of the proper site.
If such were the case, the people of the Gaspe area should not be penalized because of these actions.
The land surveys, as well as the development, expropriation and construction plans to which we have referred indicate that the current site of the landing strip, without being ideal, is quite adequate and improvable.
Mr. Speaker, I could talk for hours about our air services in Gaspe, but I find it rather disappointing, and the population too, to see all those conflicting reports which have been submitted for 10 years, and while the competence of department officials cannot be questioned, I submit, Mr. Speaker, that before making a consistent decision on all those files the minister should seek advice and ask for some assessments by independent consultants.
Gaspe is over 500 miles away from large centres like Montreal, and we have been waiting for years for the federal government to take action and give a better service to our people. How is it possible that people still trust a department which has been submitting conflicting reports for 10 years now? 1 leel it is incumbent on the minister, with the powers he will derive from this new bill, Bill C-40 now under study, that from time to time he seek consultants' advice to assess whether regulations or regulations enforcement are consistent with reality. We doubt whether some officials could have been overzealous to the point that they have shelved certain projects which our people had called for many years. On this, Mr. Speaker, I will conclude.
soois-isyz

June 13, 1977
Aeronautics Act


Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, I should like to say a few words on this bill. It is one which I believe to be considerably more important than one might think at first blush. If there is any form of transport which is regulated or overregulated, it must be air transport. There seem to be commissions and regulatory bodies extending throughout its operations, and the bill before us further increases the scope and power of those who make decisions. Above all, it increases the power of the minister to intervene.
I think the measure should certainly go to committee in order to give us an opportunity to hear further explanations of the way in which it will operate and also, in particular, to hear representations from the people likely to be affected. I should like to comment on the clause which has to do with zoning, having run into these circumstances in a small way in connection with one of the airports in my riding. The present method of zoning leaves much to be desired. Little guidance is offered to those directly concerned. Numerous restrictions may be imposed, sometimes without explanation it would seem, and those upon whom the rules are imposed often find them onerous and difficult to understand. It would appear that if this bill passes, the owner of any type of airplane, even if he keeps it in his own garage, will have to hold a permit and that he may, if he files a flight plan, be liable to pay certain fees. This is on the ground that he is using government services and therefore a charge should be made.
In my area a considerable number of people are flying- so-called flying farmers-who use their flying machines for pleasure and for business purposes. The problem of crop spraying has become important. This seems to be a dangerous type of flying. There always seem to be a few pilots killed every year. One was killed just last week in the interlake country of Manitoba when he was crop-spraying. There is also the problem of the incompetence of flyers in dealing with pesticides and herbicides which are used by them. This is being regulated partly at the provincial level. There is a statute at that level which will soon be promulgated, and no one will be able to fly while crop-spraying without having attended a provincial course on the use of pesticides and herbicides. This is a step in the right direction in that the business of herbicides is very important.
I would like to turn to the bill at page 10 under clause 7 where it mentions the rule of the Canadian Transport Commission on licensing for proposed scheduled commercial air service and also for proposed commercial air service without a schedule. This is important and is coming to the fore at this time, because we are finding a good deal of competition between our airlines in Canada. There is widespread unrest among our airlines and a feeling that Air Canada, having 75 per cent of the cross-country passengers by regulation, is not working in the interests of air travel in this country. This is being particularly voiced in western Canada. This rule that 75
(Mr. Cyr.]
per cent of all passengers across the country must go by Air Canada is working against the best interests of the competing airlines and is not all that successful for Air Canada because it is in the red, as well. One of the important comments which was reported on the CBC not so long ago is as follows:
In a vignette offered on Air Canada recently by the CBC radio program, the Royal Canadian Air Force, in a sturdy voice declaimed, "When you hear nasty things which put down our national airline, then stand up straight and tall and proud and demand in a loud, clear voice so all can hear: Do you know where my luggage is?"
This is indicative of our feelings on the service Air Canada has given. Air Canada has often been, seemingly, in charge of the negotiations of the Department of Transport. This was evident some time ago when the transporter routes were allocated between Canada and the United States. The allocation of those transporter routes, wherein Air Canada received all but one, has certainly made other airlines very bitter. Their feeling is that an airline with a government-supported monopoly and charged to the Department of Transport is not the best thing. In my province of Manitoba, Transair president Arthur Mauro said:
"It seems pretty well it's what Air Canada wants that determines what the cabinet decides."
Mauro said that shutting out Winnipeg-based Transair from the hope for trans-border routes-which went to American carriers has resulted in "the most tragic lack of Canadian carrier participation in the central Canadian-U.S. traffic".
Transair wanted to serve Denver, Chicago, Minneapolis, and Milwaukee but the government "did not even have the courtesy of placing our request before the Americans", he added.
At the other end of the country, Mr. Robert Chartland, the public affairs director of Quebecair, said:
We're really disappointed-maybe we'll have our turn one of these days.
This details some of the problems we have with many regulatory bodies in Canada. We have an airline which we protect through the government and we are restricting privately-owned airlines which give competition to that airline. I would hope we would have this bill in committee and have important and knowledgeable briefs from people who know what this means. I would like to make sure we do not in any way impede or curtail private airlines and small private operators which have contributed so much to the development of aviation in this country.


Donald W. Munro: Mr. Speaker, it is with some regret that I rise once again to express my views about the absence of radar at Victoria international airport. I seem to be getting nowhere with a problem which has been bothering me since the beginning of this year. I should refer to the first clause of this bill which grants the power to construct and maintain all government aerodromes and airports, including all plant machinery and buildings necessary for their efficient equipment and upkeep. I am referring to the plant required for the efficient equipment and upkeep of an international airport.
As long ago as January of this year I raised this question. Actually, I raised it in September of 1976, so it has been standing almost a year now. I had a special cause to raise it
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again in January because of an incident which occurred when 1 was aboard an aircraft leaving Victoria international airport bound for Vancouver. On a number of occasions since then I have asked what is required to trigger an inquiry into an incident-I put "incident" here in quotation marks-affecting two aircraft in the area.
Perhaps there should be some automatic triggering mechanism which would cause an inquiry to be made. I would have thought that when either a controller or a pilot of an aircraft involved in an incident-and I am sure they all make reports of these incidents which occur during their flights-uses the words "collision", "near collision", "possible collision" or "near miss" in his report, and when that report reaches the superintendent of air safety, that would cause an inquiry into that particular incident to be made. I would have thought this inquiry would bring together the visual records and the accounts from the taped flight-deck electronic equipment to determine whether there were means of avoiding a recurrence of incidents of that kind.
Mr. Speaker, you were not with us when we approached Victoria international airport at the end of May. A group of parliamentarians from this House and the other place were on board a service aircraft. As we reached my riding, I felt it would be courteous for me to rise and welcome my colleagues to my riding. I informed them that they did not have to worry, that they would soon be within binocular range of the airport and that we would be brought down safely. There was no problem at all; it was a clear day. However, as soon as I used the word "binocular" in connection with the landing of that aircraft, a prominent member on the government side asked, "Are you suggesting that there is no radar at Victoria international airport? That upset me deeply because there has been correspondence, questions in this House and bills relating to air navigation. I have spoken on the "late show" and I have endeavoured by every conceivable means to bring this lack to the attention of the minister and to have him rectify a situation which I think is inexcusable.
I think it is worth mentioning to the minister, since he is here this afternoon, that there have been other incidents since. If I remember correctly, one occurred during the stay of a Canada-U.S. interparliamentary group in Victoria. The incident occurred over Active Pass. The incident involved a scheduled flight of a float-plane from Victoria harbour to Vancouver harbour. It was a very near miss. I am not suggesting that these flights be directed from the ground. That is not the point of my reiterating this plea. The point is that the pilots who are in the air should be informed of what else is in the air so that they may know what is above them, below them, to one side, crossing their path or otherwise in the general area of their flight.
This particular incident took place when the Canada-U.S. interparliamentary group was meeting in Victoria during the last weekend in May. I understand that the separation was something in the order of 100 feet, which is very close. It is
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much too close for comfort. Those who were on board the aircraft were distressed to learn that there was no radar which could have informed the pilot of the aircraft that there was another aircraft in the area. I am informed that the area between Active Pass and Victoria is within the control area of the control tower at Victoria international airport.
It is asking quite a lot to ask the controllers in that tower to cover the 360 degrees around the tower to the depth that is required for the distance from the tower to Active Pass and to identify all aircraft flying in that area in order to notify other aircraft that are approaching or transiting. This is one other matter which is neglected by the minister. I see that he has left the House. Perhaps his officials will make a record of some of these comments. I hope they bring them to the attention of the minister and to the safety committee.
It is not just traffic in and out of Victoria international airport which concerns me. Traffic transiting through the air space above and around that control area, perhaps on its way from Portland or Seattle to Alaska, concerns me as well. I agree that that traffic is generally very high, but incidents could occur which could cause those aircraft to descend into the paths of aircraft which are doing normal scheduled flights, practice flights or sport flights in and out of the Victoria international airport.
Therefore, I appeal once again on the ground of absolute traffic requirements that surveillance radar be placed in Victoria international airport to cover the contingencies which could arise because of transiting traffic in that general area. I am not talking about IFR, I am talking about VFR, and I am aware that it is up to the pilots to avoid problems. It is not up to the controllers to cause separation, under VFR; I know that. That is not the point. However, the pilot should know what else is in the air. He should be informed that there might be an aircraft which has a capacity to fly at a certain rate, travelling on a certain course, at a certain height, and which is likely to be very near the path of another aircraft. These two facts can be taken into account by the pilots, and can avoid collision.
Let us not forget that sometimes our commercial pilots who after long flights are just landing at the Victoria international airport are fatigued, and their reaction might not be as hasty as it should be. I thank them for their speed of reaction on January 21, 1977, when a collision was avoided, and again I ask, if the word "collision" appears in the report-and I can swear that it did-why was there not an inquiry into that incident?
I am not attempting to have IVR control taken over from Vancouver-they do it very effectively-but the fact remains that IVR control in Victoria has had to proceed with the same number of personnel, despite the near doubling of traffic in and out of that airport. I suggest that a surveillance radar, properly positioned and feeding into a screen in the control tower, would provide the missing security link which is needed to give absolute assurance to the controllers and the crews of the aircraft, and of course to the passengers, that is so essential

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for a security record of which Canada can be proud. We must maintain it.
One other comment is that we must get this bill quickly to committee where we could have witnesses to inquire into matters such as I am raising here today, and also into other much more mundane matters affecting the territory of airports. I refer to the security fence. It is almost a dead issue. It was built half way around the airport and, despite a good many objections that were raised locally, it does nothing to increase the security of the airport in cases of hijacking because it is only half way around. I thought the whole thing had been forgotten, but then I learned last week end that one of the fields granted by the Department of Transport and the airport manager to a community group as a soccer field has now been divided down the middle by that useless fence.
I secured the permission of the minister and of the manager of the airport to have that soccer field left free so that the children of the community could have a place where they could gather on lovely days such as we have today, or even on wet days, to play soccer. Now I find that the only large area available to them for that purpose has been virtually destroyed by the building of a fence right down the middle of it.
When the bill goes to committee I will have some evidence brought forward respecting these two matters, and the power that the minister is exercising, or ought not to exercise except after he has taken into account the needs and requirements of the users of the airport.


Mr. Cecil Smith (Churchill):: Mr. Speaker, I believe that the last time I spoke when you were in the chair we were also talking about aircraft, only it was the transportation of parrots to Yugoslavia. However, I find that the air regulations in Canada, especially northern Manitoba, are about as obsolete and out of date as they are in Yugoslavia.
Coming from northern and central Manitoba I must point out that airports are our lifelines because we do not have road systems in the north and we depend entirely on aircraft for transportation of people to the large centres, transportation of children attending school, and transportation of food supplies to the various communities. Over the last 20 years we have seen an increase in air travel throughout northern and central Manitoba to the extent that we now have approximately ten different airlines flying in the area, some of them serving the smaller communities and others serving the larger communities such as The Pas, Flin Flon, Thompson, Churchill, and Gillam. Those are larger communities that had airports prior to 20 years ago.
However, in 1966 the then premier of Manitoba, Duff Roblin, said that on Manitoba's centennial, which was in 1970, every community of over 100 people would have an emergency airport. This would consist of a landing strip which would measure some 2,000 feet long, be approximately 350 feet wide, and would be classed as an emergency airstrip. This emergency airstrip program got under way and was nearly completed by 1970. There was an emergency airstrip in each community.

We found that we had revolutionized travel in northern and central Manitoba to the extent that wheel equipped aircraft were circulating these airstrips before they were completed. Prior to the landing strips being built, aircraft only equipped with floats could land on the lakes, and aircraft equipped with skis in the winter could land on frozen lakes. They were the only means of transportation. This resulted in long periods in the spring, called break up in the north-this is the breaking up of ice-and in the fall, when aircraft could not land. In many instances the medical requirements of these communities were not available. Of course in later years helicopters were used to transport patients out to nearby hospitals. However, the airstrips in northern Manitoba have been brought up to a standard so that even the Department of Transport recognizes some of them.
The biggest problem that we are experiencing right now is that, of the 25 airports in Manitoba, the federal government will only recognize five or six. The remaining airports operate under the restrictions of the Department of Transport with regard to the size of aircraft that can use these airports, the type of licences given to these particular airports, and so on. This brings me to the point where I really feel I must speak on Bill C-40, and once it is in committee we hope there will be sufficient witnesses to bring us up to date on exactly what is happening in air transport with regard to isolated and inland areas of Canada.
Some months ago Transair sold out to Pacific Western Airlines and a portion of their company, called Midwest Aviation, was sold, or is in the process of being sold, to Perimeter Aviation of Winnipeg. What took place is a real mystery so far as other operators in Manitoba are concerned because we have people like Taylor Airways operating out of a place called Gods Lake Narrows, who have serviced that community for 15 years, not always with wheel equipped aircraft but, prior to that, with ski equipped aircraft in winter and float equipped aircraft in summer, to fly people out during emergencies, to fly trappers out to their trap lines and fishermen out to the various lakes where they fish commercially in the summer time, and also to transport their fish to the market. What has happened is that now that the Midwest portion of Transair has been sold to Perimeter Aviation there is some agreement between Perimeter Aviation, Midwest and CTC that seems to dictate that if they buy Midwest they will want all the flying rights to the northeastern portion of Manitoba which is presently being serviced not only by Taylor Airways out of Gods Lake Narrows but by St. Andrews Airways out of Island Lake. Incidentally, St. Andrews fly approximately 3,000 passengers a year out of Island Lake, St. Theresa, Wasaganac and Red Sucker. The total population of those four small communities is approximately 2,500 people.
The problem arises when one aircraft company wants to take over a particular area of northern and central Manitoba. The company we are talking about that is planning to do this is Winnipeg Airlines. It is based in Winnipeg, whereas Taylor Aircraft is based in the community of Gods Lake Narrows,
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and St. Andrews Airways Ltd. is based 25 miles outside Winnipeg, St. Andrews Airways Ltd. applied to the CTC for permission to operate out of Winnipeg International Airport and was turned down. This is an inconvenience to the people who fly into Island Lake and St. Theresa Point. This is approximately 300 miles, and then of course they have to pay additional costs to get out to the St. Andrews airstrip. This poses problems for the aircraft company as it means they cannot be competitive with other companies that operate out of the Winnipeg International Airport. After the application was refused by the CTC, St. Andrews Airways Ltd. received a cease and desist order which limited them to operating out of St. Andrews.
The ironic thing is that the St. Andrews airport is of limited size, and St. Andrews Airways Ltd. is using aircraft that are the maximum allowable size for operating in that area. I feel that heavy duty aircraft are not safe to operate there with loads of passengers. The company has given excellent service to the people of Island Lake over the years, and it should be remembered that these people have no other means of transportation. I cannot see the rationale behind refusing St. Andrews Airways Ltd. permission to fly out of Winnipeg International Airport. There seems to be a move afoot to eliminate all the small operators in northern and central Manitoba and to give the business to one big company.
Taylor Airways have four aircraft that operate entirely out of Gods Lake Narrows. They employ local people, and money is spent in the community. This is the kind of operation we should have in the north, and we are not satisfied with only the larger companies operating our transport system.
Air Canada is a good example of a large company running at a deficit. I can see the same thing happening if we turn all the business over to other larger companies. We should keep some of the small operators who provide excellent service to the community.
Cross Lake Airways operates out of Wabowden, Manitoba, and provides excellent service to Cross Lake and Norway House. These little airways that operate in the north do not fight with each other; each has its own base of operation and they all provide good service, so I think we should leave them alone. They are subject to the same regulations as anyone else; their aircraft have to be up to standard and they have to meet the regulations. I am sure a larger company would have difficulty meeting their standard of service. The fact that an aircraft is sitting in the community day and night, and is there in the event of a serious accident, means that the people do not have to call out on the two-way radio to Winnipeg for an aircraft. In a lot of cases an aircraft might not arrive from Winnipeg until the next morning, but when there is one in the community an emergency is taken care of immediately. The bush pilots know the terrain and how to operate under conditions peculiar to the north.
Aero Trades operates out of Oxford House with a small aircraft, and Calm Air Ltd. operates out of Lynn Lake and Thompson into other small communities. I do not think it is
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sensible to replace these small operators with a larger air carrier.
Judging by the regulations imposed by the Department of Transport over the last few years, it would almost seem as if the department is jealous of the fact that in 1966 Manitoba built airstrips in remote communities that were not serviced by other means. A good example of the strict regulations imposed by the department is found at the Oxford House airstrip. Five others were closed, but Oxford House was left. The departmental engineers went up there for 24 hours and then issued a report saying that the airstrip was not suitable for particular types of aircraft. Mr. Speaker, I am interested in safety, but we must realize that all airstrips in the north cannot be equipped with radar. When we talk about IFR in the north we joke that it means "I follow the railway" or "I follow the river" because the isolated communities just do not have the modern IFR systems.
After 1967 the Oxford House airstrip was hampered by regulations. Apparently only one type of aircraft could operate there. The province of Manitoba was responsible for doing the work on the airstrip required by the report from the Department of Transport-the building had to be moved, the airstrip lengthened and widened, a certain type of aggregate put on it, and many other things that could not be done in one year because the heavy equipment required was not available.
There were two years when the community could not be served on a regular basis by a certain classification of air carrier. Then out of the blue, some four months ago, the Oxford House airstrip received a clean bill of health from the inspectors. It may be that the inspectors had changed and finally there was somebody who could relate to the north and the development taking place there. Now the community is serviced with a regular schedule. There are three flights a week into the community and the people do not have to charter a plane every time they want to leave.
Why should the community of Oxford House have gone without regular air service for two years? The buildings were not first moved in accordance with the stipulation of the inspector visiting the area, and to my recollection the airstrip was not extended. A bit of gravel was put on it, which would be helpful on a wet day. But most airstrips in that part of the country are frozen solid seven months out of 12, and some are located in regions of permafrost. This community suffered two years because it was said its airstrip did not meet Department of Transport standards. Then, out of the clear blue sky, the community got a clean bill of health and was told its airstrip was adequate for bigger aircraft.
We must watch air transport developments in the north closely. We do not want large operators shoving our smaller operators aside and taking all their business, for we need small operators in many remote communities which can only be serviced adequately by small operators operating a few small aircraft. People want to be reassured they can fly their sick children to hospital. Many small communities are served by

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small nursing stations, but their staff is not qualified to handle major emergencies.
When the bill is in committee I hope witnesses will appear to say what is happening in the field of air traffic in northern Manitoba, indeed, all across the north. It seems that the Department of Transport people look jealously on Manitoba's program these past few years to develop airstrips in remote places. That this has happened at all is owing to the forward thinking of Duff Roblin in 1966 who said every remote community of 100 or more should be equipped with an emergency airstrip. We have grown, and the department should keep up to date with developments in the north. It should know how important small aircraft companies operating several aircraft are to remote communities, and how they provide those communities with services they need.


Mr. Doug Neil (Moose Jaw):: Mr. Speaker, I want to speak briefly on Bill C-40. A previous speaker read into the record a letter an aircraft consultant sent him, a letter which said many of the things I want to say.
In my particular part of the country we have many small aircraft owners and many flying farmers. They own and fly small aircraft sometimes for pleasure; often they use them for crop spraying, or for going to a larger centre to pick up repair parts for farm machinery. Most of their flying is done from an airstrip on the farm, or from a small airport not operated by DOT. From time to time they occasionnally use Department of Transport facilities.
I am particularly concerned about clause 2 of the bill which gives the minister authority to impose charges on the owners and operators of aircraft. It says the governor in council may imposes charges with respect to "any facility or service provided by the minister or on his behalf for or in respect of any aircraft during flight.. That is a broad section and needs clarifying. Does it mean that if a pilot of a small aircraft calls a DOT aerodrome for a weather report, he will be charged for that service; or if he calls the control tower for a bearing, to check his position in relation to the airport, he will be charged for that service?
Perhaps there is nothing wrong with the user-pay concept in general but, for owners of small aircraft, I wonder.
Reading Clause 2, I note that the owner or operator of an aircraft will need to deposit each year with the minister "security in the form of a bond or letter of credit..." Further, all charges imposed upon the owners or operators of aircraft constitute a lien upon the aircraft. This means that if the charge is not paid, the aircraft could be seized and sold for payment of the charge.
Many private pilots and flying farmers use Department of Transport facilities perhaps only once or twice a year. I don't know what the charge will be-perhaps it will vary from $1.50 to $3. Every time one of these small aircraft pilots uses the service, it will have been recorded. The Department will need to set up an administration to do this, either at some central location in the west, or down east. Each time a pilot uses a service, it will be recorded. The question is, how much will it

cost to administer the system for recording every instance a small aircraft pilot uses a DOT facility-when he may run up a bill of, say, $5? In addition the pilot will need to file a bond or letter of credit each year. I assume someone will have to check out those letters of credit to make sure they are valid. In cases where no security is filed, the department will need to institute some follow-up procedure. I visualize a burgeoning bureaucracy for recording such charges and collecting fees from pilots and operators, and it seems to me that the administration costs will exceed greatly any revenue the Department of Transport may collect for these services.
The minister should reconsider those provisions applying to private owners or flying farmers and make an exemption in their case. Granted, the language of the bill does not go into great detail. I therefore hope, when the minister or his officials appear before the committee, we shall see some clarification of various clauses.
Another clause which gives me some concern is the one which requires the licensing of facilities where aircraft are being serviced or repaired. This might be necessary in cases where a commercial operation is being carried on. However, on the face of this clause, it appears as though an individual who has repair work carried out in his own hangar on his farm would be required to have his facilities licensed.
I can think of one particular individual who lives in the vicinity of Moose Jaw, a flying farmer who refurbishes antique aircraft. He is a qualified engineer. All the work is done on his own farm by himself. Does he need to have the building in which this work is carried out licensed? That would be a ridiculous situation. I can understand the requirement for licensing aero engineers or air-frame engineers. However, to require the licensing of a particular building where the work is carried out is rather ridiculous.
Clause 3 also gives me some concern. It requires owners or operators of aircraft to carry liability insurance. Most owners and operators of private aircraft do in fact carry liability insurance. I do not know the reason for this clause. It may be to ensure that those operators who are the exception to the rule have insurance coverage. Surely the bill should state the extent of the coverage required. This will be done by regulation, however.
This bill is typical of most legislation that comes before the House. It is in general terms. The meat of the legislation, what you need to know, will be put into law by regulations that do not come before the House. Members will not have the opportunity to discuss, debate, and receive feedback from their constituents. This is one of the faults of this bill, as with many other bills that come before this House.
I look forward to seeing this bill in committee. Hopefully when the minister appears he will give a detailed explanation of the various clauses or, alternatively, the members of his department will do that. This bill should remain in committee long enough so that interested pilots, operators, and groups will have an opportunity to make representations, whether
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verbal or by way of written brief, to the committee. I repeat, I look forward to seeing this bill being discussed in committee in the near future.
Mir. Sinclair Stevens (York-Simcoe): Mr. Speaker, in rising to speak on Bill C-40 1 do so with two distinct interests. The first is with regard to Clause 2 which appears on page one of this bill. It refers to the misnomer "user pay" which the government uses so often. I suggest it is a misnomer because the government very carefully never defines what the user is going to be expected to pay with regard to the so-called government service being supplied.
Speaking about user pay, I must recall for hon. members what happened over the last week or so. The minister sponsoring this bill chose to fly to the Hamilton area aboard Nordair, a free flight. On arrival, he explained to those in Hamilton why he felt user pay was a good concept.
I rise to speak with regard to the user pay reference in this bill, the extension of authority in that connection which the minister is asking for, and the extended authority the minister is asking for with regard to the zoning of lands involved in airport development. The reason is that we have witnessed the federal government running our airports in an unsatisfactory way. For several years they have been in a deficit position. It is time that the government be called on to state why our airports continue to lose money while those of the United States, of comparable size and activity, are making money.
In my remarks today I want to cite certain examples in the United States where local airport authorities find the operation of airports one of the most profitable things they are doing. Because of this obsession with centralization in Ottawa, our airports, especially the larger ones, are now starting to go heavily into deficit.
I suggest that local authorities be established not only for the administration of airports in an area such as Toronto, but that the local authorities be given authority over commuter transit as far as the railways are concerned and, in the case of Toronto, authority over the local harbour facilities. In short, it should be a transportation authority that the federal and provincial governments should be working towards, as opposed to this outdated concept that, frankly, is a hangover from the depression when airports were accepted as a responsibility of the federal government. 1 say that because the evidence is clear. This government is not competent to run a local airport efficiently. Certainly in the case of Montreal, Toronto or Vancouver that goes without question.
When we are asked to consider a bill such as C-40, we must ask some questions. Is the time not right to turn away from this centralist approach with regard to Canadian airports and accept the local transportation authority concept for the running of facilities in such urban areas such as Montreal, Toronto or Vancouver? In advancing that, and I relate it to Clause 2 which speaks about user pay, I do so because the average Canadian has no objection to paying for whatever services he feels he is using.
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However, I feel that the average Canadian takes great exception to paying for so-called costs that are needless. Frankly, that is now the case with our airports in Canada. It is not only the Post Office that is running up huge deficits, but airport activities.
If we go back in the history of the operation of the transportation department we find that the government at one time set up what was called a revolving fund in connection with Toronto, Montreal and Vancouver airports, a fund which was to be self-sustaining. And for a time it seemed to work. There was roughly sufficient income coming in to cover the expense of running these airports. But in the year just passed, that is, the fiscal year 1977, the expenditure in the three cities to which I have referred is expected to total $227.6 million and the revenue amounts to $121.5 million, leaving a deficit on the operation of airport facilities in those three cities of $106.1 million.
Let us get it straight. When the minister, in this bill, says the user should pay, what he is saying is that users should be required to pay for such deficits as these incurred in the operation of airports in Canada. It is as simple as that. So I think it behooves every member here to ask the critical question: has the government been prudent in running this show in a manner which has resulted in a $106 million deficit?
The deficit is broken down as follows: in Mirabel expenditures will amount to approximately $78 million and revenues will be about $22 million. There you have a loss of something like $56 million in the operation of Mirabel alone. Dorval made a small profit-about $5 million in the year to which I have referred. Toronto No. 1 at Malton, which used to make money, is now losing money to the extent of about $22 million under the guidance of the present minister and his predecessors. Pickering, that aborted white elephant which the government intended to place northeast of Toronto, is losing $18 million, according to the figures to which I have referred, and Vancouver shows a loss of approximately $14 million.
In short, in each of our cities, every one is losing money. For example, Toronto is the ninth busiest airport in North America; Montreal is the tenth busiest. Is it not unbelievable that these should be the only two airports on the entire continent of comparable size which are losing money? Surely the federal government and the minister who sits here today must accept some of the responsibility for this sad state of affairs.
In Chicago, Midway and O'Hare airports, for example, handle more passengers than the entire industry in the Dominion of Canada. O'Hare handles 54 million passengers and it is making money. In fact Chicago claims that this is one of its most profitable municipal ventures. I should like to point out that O'Hare is operated by a city department and is entirely a municipal responsibility. I would also point out that the Chicago airports are not funded even by the municipality. They are entirely self-supporting. This brings me to a point which hon. members should bear in mind.
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In the United States they do not propose to expand airports or build new airports until sufficient revenue is guaranteed by the carriers wishing to use those airports to pay all the interest charges, all the depreciation, and to retire the bonds which would be required to finance the undertaking. In short, each airport has to be self-sufficient and capable of standing on its own feet, or it is simply not built.
In this connection, at the time the government was pressing so hard to build Pickering in the Toronto area, we on this side consulted with the Commissioner of Aviation in Chicago. Bearing in mind that at that time his airport was carrying seven times the number of passengers who were going through Malton I asked him whether any consideration had been given to the building of a new airport. He told me the matter had been considered but the decision had been taken in the negative, partly for environmental reasons, partly because it was felt that any need for a new airport would not surface before 1990. Moreover, the Chicago Commissioner for Aviation told me-and I felt this was most interesting, "Frankly, we could not afford a new airport such as you are contemplating at Pickering, or such as you have built at Mirabel."
Why should we in Canada assume that we can afford to do these things because a department of transport here in Ottawa says we should build an airport? Why should we assume we can afford an airport in circumstances in which, as the minister now tells us, the users will be required to pay? The fact is that if we wish to win tourists from other countries, particularly from the United States, we ought to be providing cheap transportation facilities. We ought not to start building white elephants such as Mirabel or the one proposed at Pickering.
Let us go back to the Chicago situation. In Chicago the airport authority is completely self-funding. The principal airport in Chicago, O'Hare, is the busiest in the world, as far as I know. From its conception it has been funded by floating revenue bonds, as they are called, and was the first airport to finance expenditures entirely out of income revenue. Those bonds are backed entirely by the ability of the airport to generate revenue. To this end, the bonding agreement requires O'Hare to break even each year; revenue always equal expenditures, and any surplus as it is called, is immediately distributed to the bond holders as interest.
To ensure that revenues are always sufficient to cover expenditures, landing fees are adjusted twice yearly. This system has proved so successful that the bonds, which were initially to be due in 1990, will probably be paid off in ten years-some have said they will be paid off even earlier, leading city officials to expect that the airport facilities in Chicago will become a significant source of income for the city itself.
What a contrast when we look to Canada, Mr. Speaker! In Chicago they regard their airport as a potential source of significant income. Yet we have a government which, acting through the present minister, is so incompetent that it is telling us that new powers are now needed to impose charges on a user-pay basis in connection with airports which should properly be running at a surplus, not a deficit. The phenomenal
growth at O'Hare has seen traffic expand from roughly 10 million passengers-approximately the level at Mirabel at the present time-to some 44 million passengers in 1976. Approximately 700,000 operations are handled annually at that airport, or on an average about two a minute. There is an airport that is handling approximately two aircraft movements or operations per minute-700,000 in a full year-and they do not feel the need a new airport. They say they cannot afford it. Yet Toronto, which has a fifth of that volume, is said to be in such a state that they must have further development and the building of a second airport in the Toronto area.
I should mention two other airports in Chicago-Midway and Mieggs Field-which are both operating at a slight profit. In Chicago they have demonstrated they can operate their airports at a substantial profit, and not at a deficit such as this government is experiencing. If I had more time I would continue and tell you about the situation in Los Angeles, which is essentially the same as I have indicated. They are making money. Atlanta is making money and Boston is making money.
The New York Port Authority has published its 1976 annual report entitled "The Port Authority" and I recommend to the Minister of Transport (Mr. Lang) that he read it. Presumably he has not read it to date. That report spells out the activities in the three main airports in the New York area-Kennedy, LaGuardia and Newark. Two of those airports have activities larger than those handled at Malton, and one is smaller. Newark is smaller in that it handled 6,753,000 last year. LaGuardia handled 14 million passengers, and of course is bigger. Kennedy handled 21 million, roughly half domestic, half overseas, in 1976. All three airports make money. How come we in Canada, in comparison to those three airports I have mentioned, are losing money? I am referring to Montreal, Toronto and Vancouver. They are losing money, yet airports which are being handled by the Port Authority in New York and New Jersey are actually making money.
Over-all the balance sheet of the New York Port Authority is very, very impressive. In 1976, for example, they had operating revenues of almost $500 million. On that amount their income from operations was $95 million. They made almost 20 per cent on their total operation in that year, and that is after $90 million was charged against depreciation. After paying various items, such as the interest on their bonds of $78 million and interest on bank loans of $9 million, the Port Authority ended up with a net income of $37 million.
There would be no need in Canada for the so-called user-pay concept if the government ran our airports efficiently, or returned those airports to local authorities where they could be integrated with the general commuter activities which are presently needed in areas such as Montreal, Toronto, Vancouver and certain other large centres.


Some hon. Members:: Hear, hear!

June 13, 1977


Sinclair McKnight Stevens: At committee stage I hope the minister and his staff will be prepared to justify why they are losing the money to which I have referred. Before we bindly give him the power to charge higher fees on a user-pay concept, we must find out why they are running up the deficits to which I have referred,
1 should like to touch on the second item in this bill which disturbs me greatly. I refer hon. members to page 5 which deals with this extension of federal power into the zoning of lands adjacent to or involved with airports in Canada. As the bill points out this is a new provision, and it is stated that this amendment would authorize regulations respecting federal land use control in relation to airports or airport sites. I should like to refer to the proposed two sections which concern me. The first is found at page 5, section 6(2), which reads as follows:
Subject to the approval of the governor in council, the minister may, by regulations, designate lands adjacent to or in the vicinity of an airport or airport site as a protection area to prevent the use or development of such lands or any part thereof in a manner that is, in the opinion of the minister, incompatible with the operation of an airport where ...
And certain circumstances are then set out. I would also like to direct hon. members' attention to subsection (4) at page 6 which reads:
Any owner or lessee of lands forming all or part of lands designated as a protection area by a zoning regulation who was in occupation of those lands immediately before the zoning regulation became applicable thereto and who, at that time and in the course of such occupation, was making use of those lands or any buildings, structures or objects thereon in a manner that is incompatible with the uses prescribed therefor by the zoning regulation, and any successor or assignee of any such owner or lessee, may continue to do so unless such use by such owner or lessee is specifically restricted or prohibited by the zoning regulation.
I should like to summarize those two subsections, as I understand them. The minister, in effect, is requesting newfound powers to zone lands arbitrarily which are appurtenant or in the vicinity of an airport or an airport site. In subsection (4) he makes it clear that you can carry on your use, provided it is not prohibited under the new regulations which the minister is hoping to have the power to make.
When we look at page 8, subsection (10), we are told that the user of that land, if he has been prohibited under the minister's new regulations, is entitled to compensation in the amount by which his interest in those lands, buildings, structures or objects was decreased in value by the application of the regulation, minus an amount equal to any increase in the value of that interest that occurred after the claimant became the owner thereof and that is attributable to the airport or airport site. The minister is asking for new powers to affect the zoning and the land use appurtenant to airports or airport sites. He makes it clear you may not use your property in the future, if he designates a prohibition against it.
The compensation is a rather odd formula. First of all you have to show the extent to which you feel it has been depreciated, as a result of the government's move, but you must also add in any appreciation which may have followed from the airport being situated adjacent to you. Thus, it is a minus and a plus type of concept which the minister has proposed.
Aeronautics Act
I should point out under subsection (11) that you must make your claim within two years. That is an arbitrarily short time because if they are going to put an airport in beside you, it takes time to build these airports and to see exactly what the traffic pattern will be after the airport becomes operational. That time should be longer than two years. A person will be in a position to lose his rights because the arbitrary time limit will have elapsed and he will not know, up to that time, the full impact of the airport activity which the government has placed in the area adjacent to him.
In subsection (12) the minister goes on to make it very clear that, except as set out in subsection (10) which is the compensation subsection, you are not entitled to any damages with respect to the airport development the minister has in mind.
The reason I want to dwell on these zoning provisions is that we have had a sad experience with this type of thing in my riding. Pickering is adjacent to the York-Simcoe riding, and in particular adjacent to towns such as Whitchurch-Stouffville, Markham, and other such towns. When the government wished to put Pickering into that area, it bought about 18,000 acres. That was very unfortunate. However, it also requested the provincial government to freeze about another 60,000 acres in the area on the ground that that could be a noise area. The government wished to have further development frozen.
The Ontario government went along with the request of the federal government at that time. Happily, most of that land has been released since the ultimatum was first given by the federal authorities. However, it was a very uncomfortable and unsatisfactory experience for all concerned. People who had farms were uncertain as to what extent they could continue to farm them. Businessmen and housewives were greatly upset with the arbitrary move made by the federal government with respect to that 80,000 acres which were to be included in Pickering and the surrounding area. Clearly the minister wants greater powers, presumably to mistreat local residents even more than they were mistreated in the Pickering area.
I feel that hon. members in this House have every right to demand from the minister before this bill is passed to know why he wants these unusual powers and rights. Surely people who live on property have the right to have the protection which has been guaranteed them by the British North America Act with respect to the use of their property? Up to the present time property and related rights have generally been considered purely provincial matters. Certainly town planning and zoning have been left to provincial jurisdiction. I think it is a very serious step backward when a federal government, especially the federal government through a department which is as irresponsible as the Department of Transport, now asks to be given the power to invade that property right which has been rarely invaded up until now.
The people in my area will be very concerned if this type of clause passes because unfortunately Pickering is not completely dead. We sense that the bureaucracy which burbles underneath this minister still wants to build one further white
80018-16V4

June 13, 1977
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elephant in Canada. I do not know why. Perhaps white elephants come in twins. However, the fact is that Pickering is not necessarily dead. If the government, heaven forbid, were ever re-elected and it felt it could get away with it, it might try to build that Pickering monstrosity. If that is so, I think we in this House should be most reluctant to give any minister, particularly this minister, the power to mistreat property owners. That could happen if this provision to which I have referred is passed, namely, Clause 6 of Bill C-40.
I know others may want to speak further on this bill, if not in this House, certainly in the committee. However, I would like to make two points in summary concerning Bill C-40. The first is that we would not need a user pay concept if the government would simply run its airports more efficiently. Second, we do not need to give any minister, particularly this minister, the power to walk over local land owners with respect to airport activities or even worse airport site activities. It must be resisted and I hope hon. members both in committee and in this House will resist this extension of power for a minister who is as irresponsible as the minister who has brought in this bill.


Mr. Deputy Speaker:: Is the House ready for the question?


Some hon. Members:: Question.


Mr. Deputy Speaker:: Is it the pleasure of the House to adopt the motion?


Some hon. Members:: Agreed.


An hon. Member:: On division.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Transport and Communications.

[Stage Direction]
The House proceeded to the consideration of Bill C-48, to amend the Farm Improvement Loans Act, the Small Businesses Loans Act and the Fisheries Improvement Loans Act, as reported (without amendment) from the Standing Committee on Finance, Trade and Economic Affairs.
Mr. Otto Jelinek (High Park-Humber Valley):: Mr. Speaker, before we move to third reading of this bill, I would like to ask for unanimous consent to move an amendment. There were discussions regarding this bill at the committee stage just last Friday, and the principle of this amendment was agreed to by the Minister of State (Small Business) (Mr. Marchand). It was indicated that an amendment in this form could be brought forward at report stage. However, because this bill came to this House at such a fast pace, we did not have 24 hours to give notice of this amendment. I therefore ask hon. members for unanimous consent to move this amendment at this time.


Mr. Marchand:: Mr. Speaker, we agree with this. We have had discussions, and in the spirit of co-operation we want to allow this amendment to be proposed so that the hon. member can be given some time to discuss it.


Stanley Howard Knowles: Mr. Speaker, we are happy to join in making it unanimous that the hon. member have the right to introduce his amendment at the report stage, even though he did not give notice on Friday.


Joseph Adrien Henri Lambert: Mr. Speaker, given the tactfulness with which the hon. member informed us of his problems, we thus agreed unanimously that he may move his amendment.


Mr. Deputy Speaker:: Representatives from each party have indicated consent, but I should also ask the House generally if there is unanimous consent to allow the hon. member to present his motion without the normal notice of 24 hours.


Some hon. Members:: Agreed.


Otto John Jelinek: That Bill C-48 be amended in Clause 4 by striking out lines 23 to 33 inclusive at page 2 thereof and substituting the following therefor:
"small business enterprise" means a business enterprise
(a)	the estimated gross revenue of which as stated in an application for a business improvement loan did not, for the fiscal period of the business enterprise in which the application was made, or, in the case of a business enterprise about to be carried on, will not for its first fiscal period that is of not less than fifty-two weeks' duration exceed $1,500,000; and
(b)	the business is not part of an association comprised of itself and one or more other businesses in the said fiscal period in which the estimated gross revenue of the association of businesses exceeds $1,500,000."
and that Clause 4 be further amended by adding thereto:
"4.1 The said Act is amended in section 2 thereof, by adding thereto:
" "association" means an arrangement of businesses whereby the separate existence of those businesses is not solely for the purpose of carrying out the business of those businesses in the most effective manner and one of the main reasons for such separate existence is to reduce the estimated gross revenue, within the meaning of this Act." "


Stanley Howard Knowles: Mr. Speaker, 1 wonder if I may ask if copies of this amendment are available and, if so, could they be distributed to those who are here?


Mr. Deputy Speaker:: We will see how soon we can fulfil this request. That is why I read the full amendment. We have copies available to leaders of parties, or hon. members can ask for them. Perhaps hon. members will allow us an extra minute to make them available to all members.


Otto John Jelinek: First, Mr. Speaker, I want to thank hon. members for giving unanimous consent to allow me to present the amendment at this time. Secondly, let me say that I have passed along copies of these amendments to the various House leaders and we are now in the process of distributing further copies to other hon. members who are interested.
June 13, 1977

The amendment may sound complicated but in fact it is very simple. The intent of Bill C-48 is to allow corporations with annual sales of less than SI.5 million to take advantage of the Small Businesses Loans Act, the Farm Improvements Act and the Fisheries Act. However, because of the lack of a general definition put forward by the government-something that we on this side of the House have been requesting for months if not years-confusion arises as to the definition of small business in this bill.
The definition of small business in this bill is one which has gross sales of $1.5 million a year or less. That definition was used in the act prior to this legislation. As a matter of fact, a major amendment in the bill before us is to increase that figure from $1 million to $1.5 million, something that we agree with because it spreads the eligibility to a greater number of small businesses. The problem is simply this, that there exists in Canada a number of corporations which may on their own have annual sales of less than $1.5 million, but which in fact are subsidiaries of large corporations, either Canadian or foreign owned, of multinational corporations more often than not, either in the United States, in Japan or elsewhere. I would like to give you a few examples.
There is a Canadian company in Toronto by the name of Toronto Iron Works whose gross sales in 1975 were $73,000. Therefore this made it eligible under this act. However, upon looking further into the matter one notes that Toronto Iron Works is in fact a subsidiary of Warnock-Hersey International which in that same year, 1975, had sales of $96 million. That is a Canadian owned company.
The second example is that of Nordex Explosives Ltd., of Montreal. In 1975 the gross sales of Nordex were $430,000. Once again, Nordex would be eligible under this act, and in fact under a majority of government programs which specifically define small business by its sales rather than giving a definition of small business. But Nordex Explosives Ltd. is a subsidiary of Dow Chemicals whose gross revenue exceeded $5.6 billion last year. This is certainly not a foreign owned company that should have the right to take advantage of Canadian government programs.
My amendment simply eliminates the right of subsidiary companies whose parent companies, whether they be Canadian or foreign owned, have sales of more than $1.5 million a year. It is a very simply amendment. The minister has indicated privately to me, as well as in committee, that he agrees with the spirit of such an amendment. In fact he said the following last Friday in committee:
I am happy to indicate to the hon. member that the Minister of Finance and I agree with the spirit of this recommendation and it would be our intention through the Department of Finance and the Department of Justice, and our own small business secretariat, to examine this question very carefully and see if an appropriate amendment could not be put at the report stage.
He went on to say:
We will make an undertaking that we will contact the hon. member also about the wording of possible amendments and keep him advised as we go along.
That was last Friday. Let me say, in fairness to the minister, that he did call me this morning. Neither he nor his officials
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had sufficient time to word their amendment. Therefore I sincerely hope that hon. members will take into serious consideration my proposed amendment to eliminate from this bill sudsidiary companies whose parent companies have sales of more than $1.5 million a year.
I see the minister is anxious to support this amendment, so let me just say briefly that this is another example of the lack of a definition of small business in Canada, especially when we can compare ourselves with other industrialized nations, whether it be the small business administration in the United States, the small enterprise agency in Japan, the small business sector in West Germany. All these industrialized nations, with a far healthier economy than ours, have a general definition of small business. The definition of a small business in the United States is as follows: "an owned or managed enterprise not dominant in its field".
Our recommendation from this side of the House-and certainly the recommendation of the Canadian Federation of Independent Business-is that the government adopt either a similar general definition of small business or the one that I put forward. The minister stated on a number of occasions that he listens very carefully if not to the opposition, to the federation. The federation has been making this recommendation, and I hope for the sake of clarifying problems like this and others related to small business that the minister would take the general definition into consideration. In the meantime I hope he will consider this amendment and include it in Bill C-48.


Some hon. Members:: Hear, hear!


Len Marchand: Mr. Speaker, as I indicated when we allowed unanimous consent for this amendment to be put, it was so that the hon. member would have an opportunity to get it on the record and have it discussed. At this time, however, I am not willing to accept the amendment in its present form but I want to reiterate the commitment I gave in committee that the Minister of Finance (Mr. Macdonald) and I agree with the spirit of the amendment. Regretfully we were not able to get an appropriate wording for the amendment over the weekend. Drafters in the Department of Finance and the Department of Justice had considerable difficulty with the spirit of the amendment.
In his amendment the hon. member referred to an association which he says means "an arrangement of businesses whereby the separate existence of those businesses is not solely for . .I made a commitment to the hon. member on the telephone this morning that we would like to see this bill go through all stages and bring back an appropriate amendment, probably this fall. I think the hon. member agreed to this. As you know, Mr. Speaker, the act expires at the end of June if this bill does not pass. I hope, with the co-operation and understanding of hon. members, we can give speedy passage to report stage and third reading of the bill.

June 13, 1977
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Mr. Deputy Speaker:: Is the hon. member for High Park-Humber Valley (Mr. Jelinek) rising on a point of order?


Otto John Jelinek: Yes, Mr. Speaker. Perhaps if the minister can assure us that he will bring the bill back in the fall with an amendment intended to do the same thing that I recommended before the end of the calendar year 1977, we would be willing to have the bill go ahead with a few words on third reading. Could the minister give his undertaking that the bill with an amendment will be brought before the House before the end of the calendar year?


Len Marchand: Mr. Speaker, I think the record will indicate my intention.


Mr. Stan Darling (Parry Sound-Muskoka):: Mr. Speaker, I am pleased to say a few words on Bill C-48. I listened with interest to the amendment submitted by my colleague, the hon. member for High Park-Humber Valley (Mr. Jelinek), and was delighted to hear the Minister of State (Small Business) (Mr. Marchand) say that the amendment will be brought in for consideration in the fall. I certainly think it merits the approval of this House because a small business loan is supposed to do just what it states-to help small business. The present legislation is supposed to help small corporations, but as 1 understand it, at present multinational corporations or even multi-Canadian corporations could qualify for the preferred business rates. Those particular companies would have no problem getting the necessary funds from their parent companies or banks, however.
There are certain clauses we approve of in the bill and others that we do not agree with entirely. The minister is to be commended for increasing the amount of the loan from $50,000 to $75,000 which, with inflation as it is, probably just means it is holding its own. The other increase is that a company can qualify if it has sales of up to $1.5 million. The total funds available are $600 million, which is an increase over the previous $300 million, but although it may sound like a lot of money, when it is spread over the many small businesses in the country it will be all taken up in a short period of time.
As we are all aware, over 50 per cent of the labour force in Canada is employed by small business, and 90 per cent of Canadian business enterprises employ 100 persons or less, so this certainly covers the great majority of business.
One thing that frustrates small businesses is the amount of government red tape they have to cope with, and it also costs them a lot of money. I hope the minister will allow a tax writeoff in certain cases so that they will not have so many problems. In the past the government granted substantial amounts of money to various departments to conduct research, but most of it has gone to big business and multinational corporations where sometimes grants of $300,000 have been made. If that were spread over small business establishments it would help a great many to improve their operating and production methods.

The Federal Business Development Bank provides large sums of money, and according to the Minister of National Revenue (Miss Begin), it has committed $1.5 billion at the present time. She also pointed out that the average loan had decreased to $46,000. This shows that small business finds the Federal Business Development Bank a great help.
When we talk about taxes, reliable figures show that Canadians pay 42 per cent of the gross national product in some form of taxes collected by the three levels of government, federal, provincial and municipal. The future outlook is ominous. That 42 per cent figure will not remain stationary; it could climb to 45 per cent. Some pessimists think it could rise to 47 per cent. I hope not. I hope governments will restrain their spending.
Interests rates under Bill C-48 will generally be set by order in council. We hope they will be set at a reasonable level, a level acceptable to the many small businesses which will want to avail themselves of this provision. The Small Businesses Loans Act was first introduced, I believe, in 1960. It all sounded wonderful: businessmen were to get government guaranteed loans from chartered banks. Unfortunately, the chartered banks did not put up neon signs to advertise these loans; there were no newspaper headlines. Consequently, even now many small businesses do not know they are eligible for small business loans. The original intention was good; it just did not work out. Of course, with all due respect to the banks, the fixed interest rate sometimes was lower than the prime lending rate; so why should the banks lend money on that basis?
I had the privilege last Friday to question the minister in committee about these interest rates, and said in no uncertain terms that many small businesses in crying need of money have a difficult time getting money at any rate. They are turned down by the banks. I said the government should step in and make it easier for small business establishments to borrow money and speed up the process. I know of some tourist-oriented, seasonal businesses in my riding of Parry Sound-Muskoka which have a difficult time making ends meet between December and the beginning of the the tourist boom, usually in May or June, and they would willingly pay almost any rate for money. Some of them finally resort to finance companies, which charge much more interest than the banks do; but the banks will not lend these businesses money. If it were not for the finance companies some of these small businesses could be in dire financial trouble or even go bankrupt. Some people think of finance companies as gougers, as charging exorbitant rates, and so on, but forget the vital role they play in the life of small business. When speaking in committee on small business loans, I have spoken of small businessmen who want to borrow as little as $500, which the banks will not lend them. They borrow money from the finance company at 2 per cent per month, or 24 per cent per annum. It sounds as if the finance companies make a lot of money; actually on loans that small they lose money, and when I tell people this they just laugh.
June 13, 1977

Our forthcoming conversion to the metric system will also entail expenditures for many small businessmen. Judging from what colleagues on both sides of the House have said on metric conversion, the costs will be staggering, and small businesses will need to borrow under the Small Businesses Loans Act.
Small business depends to a great degree on the Post Office.
I am sorry not to see the Postmaster General (Mr. Blais) here; he was here earlier this afternoon. The Post Office is the lifeline of many small businesses, and if it is not working well, small business suffers. We have it on reasonably good authority that the Post Office is not working well, that it is not firing on all 16 cylinders, so to speak, perhaps only firing on two or three. One hears rumours of impending strikes. How will they affect small businesses? Many of them will seek additional funds.
I know small businesses must be viable and that the government cannot throw money down the drain. Earlier today 1 discussed with the minister the difficulties of a certain businessman about to go under. The minister agreed to look into the case. The man in the tourist business is carrying a huge mortgage at 14 per cent. Perhaps through the federal business development bank or some other agency some solution can be worked out to keep his business afloat.
Our small business establishments are the very lifeline and backbone of our communities. By their very nature they provide a high degree of diversity, which contributes greatly to the stability of our towns and villages, indeed of our country. Yet little by little they are being forced out of business. Many of these people established their businesses over the years without receiving billions of dollars of government assistance in various forms. They built their businesses with hard work over long hours, faith in their communities, faith in themselves and faith in Canada. But no segment of the economy is more vulnerable than small business to the red tape of bureaucracy. They are defenceless in the jungle of conflicting requirements unless they hire corporate lawyers, tax consultants and government relations men, and people of that calibre are usually in the pay of large companies. Many regulations can put even prosperous companies in financial trouble, even bankruptcy.
Mention was made of the importance our neighbour to the south placed on small business. A report concerning small business says this:
1.	The existence of a large number of small, independent businesses helps to preserve competition, thus ensuring increased efficiency and high quality and reasonable prices for consumers.
2.	A large number of small independent businesses decreases the likelihood of excessive economic and political control.
3.	Small business offers an opportunity for the expression and growth of personal initiative and individual judgment.
4.	Small business is frequently the source of new products and new methods.
5.	Small business constitutes a large and diversified source of employment opportunities.
6.	Certain services essential to the economy can be performed best by small business.
It goes on to say:
In the United States, a national small business program has existed for almost three decades. Because of the Small Busi-
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ness Act, one third of federal spending for goods and services goes to small business. Since the United States has a program to benefit small business, we can hardly object to a similar Canadian program. Imagine what a larger small business sector could mean to Canada: more jobs, less need to import, retention of profits in Canada, and accumulation of valuable technological know-how. There's really no question. Canada must pass legislation committing the federal government to building domestic enterprises using the same wording and definitions as the U.S. Small Business Act. It seems to us that it's time Canada adopted something from the U.S. that makes sense for a change.
I am aware that there has been some assistance for the small businessman.


An hon. Member:: A mere pittance.


Stan Darling: Yes, but we are going to press for more. I am aware that many members opposite think the same way. I quote:
In the United States, it's different. The U.S. Congress has passed laws requiring that, wherever possible, small businesses should be involved in public purchases, whether aerospace projects or office supplies. On very large, expensive projects, the main contractor is expected to sub-contract much of the work to small firms. Last year, this policy resulted in one-third of the federal government's total spending of $54 billion being directed to small business.
I hope this government will follow their example. We have often been told that big is wonderful. However, we should start to realize with regard to small business that small is beautiful and efficient and we should give the small businessman the opportunity to compete and become bigger.


Mr. Deputy Speaker:: Is the House ready for the question?


Some hon. Members:: Question.


Mr. Deputy Speaker:: Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Deputy Speaker:: All those in favour 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 nays have it.


Some hon. Members:: On division.


Mr. Deputy Speaker:: I declare the motion lost on division.
Motion (Mr. Jelinek) negatived.


Len Marchand: that Bill C-48, to amend the Farm Improvement Loans Act,

June 13, 1977
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the Small Businesses Loans Act and the Fisheries Improvement Loans Act, as reported (without amendment) from the Standing Committee on Finance, Trade and Economic Affairs, be concurred in.


[Stage Direction]
Motion agreed to.
Mr. Deputy Speaker:: When shall the bill be read a third time?


Stanley Howard Knowles: By leave now.


Mr. Deputy Speaker:: Is it agreed?


Some hon. Members:: Agreed.


Len Marchand: that the bill be read the third time and do pass.


Mr. Deputy Speaker:: The hon. member for High Park-Humber Valley (Mr. Jelinek).


Some hon. Members:: Hear, hear!


Otto John Jelinek: Mr. Speaker, I am happy to see that finally even the government members are giving me recognition and applause. I will be very brief. I do not want to rehash what was said on second reading as well as the committee stage.
Bill C-48, as hon. members know, is before us only for the purpose of extending the act which would have expired at the end of this month. As the hon. member for Parry Sound-Mus-koka (Mr. Darling) stated, the eligibility level is being raised as well as the amount at which loans will be guaranteed which, by the way, merely keeps up with inflation. Therefore, there is no further assistance to the small community.
I have touched on the subject of definition which is a matter of great importance for the future. This was covered previously in my amendment. Interest rates is another matter which concerns me greatly. This was discussed at second reading and in the committee stage.
What concerns me most is that not only the minister responsible for small business but his officials and those involved in small business matters are not with it, if I can use that term. For example, they were asked in committee about the breakdown of the number of businesses between small business, farming and fishing as dealt with by this bill. They did not have the answer. They did not know who applied for the loans and was turned down. They did not know what the criteria was based on for raising the eligibility level to $1.5 million. They did not have reasons for the criteria raising the loans from $50,000 to $75,000. They did not have answers to anything pertinent to the small business community.
Not one of these officials dealing with this bill or other matters relating to small business was ever a small businessman himself. They had no knowledge of the small business community in their provinces or the potential solutions emanating from these debates or from interested groups in past months.
I said I would be brief and I will be. I only have one other matter that I ask for on behalf of the small businessman. It has been said in the past, I say it again and will continue to say it in the future. The government cannot deal with the problems of small business until it has an overall policy that deals with all problems relating to small business.
We know some of the problems, such as the excessive amount of paperwork, government intervention, regulation and control as well as restrictions placed on small businessmen. We know the small problems. We even have some potential solutions to those problems. What we do not have in this country and what other countries do have is a general overall policy, as we suggested in an opposition day debate a week or two ago, under a small business act. That is the only way we will catch up to other industrialized nations in dealing with the problems of small business.
The minister has been in this portfolio for nine months. A woman can have a child in that amount of time, but the government cannot have a policy. We have heard no suggestion of a policy. Bill C-48 is simply an extension of the act. Nothing has been done for the small business community of this country. That is one of the underlying reasons for the continuing problems in our economy, both in the case of secondary manufacturing and productivity as well as our current level of unemployment.
In closing, I cannot state often enough that it is of great importance for the minister and the government seriously to consider initiating at the earliest possible date a small business policy, possibly under a small business act.


Mr. Deputy Speaker:: Is the House ready for the question?


Some hon. Members:: Question.


Mr. Deputy Speaker:: Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.
Motion agreed to and bill read the third time and passed.


Stanley Howard Knowles: Mr. Speaker, I rise on a point of order. Since we seem to have moved along fairly well, and since it is a little late to start a new bill in the field of agriculture before six o'clock, I wonder whether we should not proceed to the adjournment debate. I see that the first two members on the program are here.


Ralph Goodale: That proposal makes sense, Mr. Speaker, but it might expedite our business at eight o'clock if we could have the motion formally on record; that is, item 34, which is the next order of business.


Stanley Howard Knowles: It is a motion for second reading. You won't gain anything by doing that.

June 13, 1977


Ralph Goodale: It would simply save time at eight o'clock, if members were in agreement. I do not suggest we should begin the debate.


Stanley Howard Knowles: It doesn't save any time, and the minister is not here.


Mr. Deputy Speaker:: I would point out to the parliamentary secretary since the minister is not here that if the government wishes to introduce the motion another minister would need to move it on his behalf, and the floor would likely go immediately to the opposition because if I put the motion now an hon. member would take the floor and call it six o'clock, which would entitle him to the privilege of speaking at eight o'clock. So the hon. member's suggestion is not as satisfactory as perhaps he thought it was.
Is it agreed we should call it six o'clock?


Some hon. Members:: Agreed.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. F. A. Philbrook (Halton):: Mr. Speaker, I wish to pursue a matter which has been of concern to me and to many of my colleagues for some time and which I raised again recently with the Minister of Transport (Mr. Lang) during the question period.
On June 2 I asked the minister whether a decision had been reached concerning the provision of promised federal financial assistance to provincial and municipal authorities in improving commuter transit facilities in metropolitan areas. This decision, which relates to an announcement made in 1974 that the federal government intended to spend $290 million on transit aid, $100 million of this on commuter aid, has already been deferred on several occasions.
For example, the Ontario minister of transport, the Hon. James Snow, who lives in my own constituency, sent 4 telegram to the federal Minister of Transport on February 24, 1977. I should like to quote from his telegram:
At our meeting of Nov. 30, 1976, wherein we discussed such matters as the Toronto transportation terminal redevelopment, federal participation in the acquisition of bi-level commuter rail equipment and the proposed federal urban transit assistance program, you agreed to respond to our queries and concerns by Dec. 1976. I confirmed the position of the province on these matters in my letter of Dec. 7, which to date has not been answered. Subsequently, through discussion at our executive level, we were advised that the federal position would be made known to us by late Jan., 1977.
Adjournment Debate
The text of this telegram was published in the Oakville Journal-Record and elsewhere on March 7. The Ontario minister goes on to say:
1 would stress the urgent need for a clear statement of the federal government's intention so that we can proceed with or cancel planned projects on a rational basis.
I would therefore request that you advise me at the earliest opportunity of the federal government's position on the Toronto transportation terminal, the acquisition of commuter rail equipment and finally the urban transit assistance program.
In his reply to me, the minister indicated that a decision still had not been reached on the matter. In addition, he stated that the province of Ontario had yet to avail itself of the substantial assistance provided through existing programs. Mr. Speaker, I must consider the hon. gentleman's reply as both ambiguous and inadequate. What assistance? What programs? Incidentally, we are not asking the government to spend more money but to rearrange its spending. I raise the matter again at this time because I believe it is imperative that a decision be made, and made soon.
It would, of course, be preferable, for reasons I have outlined on numerous occasions both in this chamber and elsewhere, if the final decision was rendered in favour of the proposed aid. At this stage of the game, however, I think it is most important that a decision be announced one way or the other so that those who must budget according to this decision can proceed apace with their efforts to upgrade public transit systems on a rational basis. With respect to the Toronto area in particular, projects such as the expansion of Union Station, the removal of the bottleneck at Bathurst and the extension of commuter service to Milton have been placed on a back burner by the Ontario government as they await a commitment from Ottawa to help out.
Meanwhile, funds which might be put to good use on smaller projects elsewhere are tied up until a decision is made. For the sake of clarity, I would point out that the existing programs to which the minister referred in his reply to me constitute only a partial fulfilment of the original announcement. The five-year $ 100 million capital assistance program to commuter services, which apparently came into effect on April 1, 1977, would be particularly welcome. However, in the absence of an announcement we have no idea where we stand with regard to this aid. Also, it represents only about one-third of the sum originally set down, and is woefully inadequate.
For example, the deficit of the Toronto Transit Commission alone amounted to about $50 million in 1976. Here in Ottawa, the transit deficit for 1976 was about $14.8 million and the projected deficit for this year is $15.4 million. Admittedly, the federal plan was not designed to cover operating costs, but these deficits indicate the gravity of the problem. The fact that no money has yet been requested by the Ontario government under this capital assistance program may indicate that it does not wish to tie itself into one program while the possibility remains that more money may be available later under a separate, more generous scheme. Separate programs involving grade separation and railway relocation represent separate promises and should not be confused with this issue.

June 13, 1977
Adjournment Debate
For these reasons, I repeat my request that the Minister of Transport move expeditiously to reach a decision on this pressing matter with the aid of the Minister of Finance (Mr. Macdonald), so that the business of providing efficient public transit may proceed smoothly. Again, I ask: When can we expect a decision to be announced on federal financial assistance to public transit?
[ Translation]


Mr. Marcel Roy (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, first of all, I should like to congratulate the hon. member for having brought up, once again, that important matter concerning urban transit systems. 1 am sure several hon. members-and I notice the hon. member for Laprairie (Mr. Watson) is here this evening-would also like to hear a statement on the participation of the federal government in the financing of urban transit systems. For lack of time, it is impossible for me to outline all the steps which have been taken to help the provinces, and indirectly the municipalities through the provinces, with the urban transit program. 1 therefore refer the hon. member to the statement I made on March 8 last on the official policy of the Department of Transport on urban transit.

In response to a question raised on June 2, 1977, the Minister of Transport (Mr. Lang) stated that no further decision had yet been reached on the question of federal government assistance for urban transit projects. The province of Ontario has taken the position that the project for the expansion and improvement of Union Station in Toronto, otherwise known as the Toronto transportation terminal project, should be funded in part by the federal government. Of the estimated $58 million cost of the project, the provincial government has determined to its satisfaction that it should contribute only $26 million while the federal government should provide the remainder.
Federal ministers have met with the premier of Ontario and appropriate provincial ministers to discuss the Toronto transportation terminal project and federal officials have participated in the work of a committee which has responsibility to examine, plan and ultimately implement a number of measures which would permit the capacity of Union Station to be increased in order to provide for the growth of commuter services-that is, GO transit-over the next few years. The position taken by the federal government to date has been that it agrees in principle with the need for some improvement to Union Station, the trackage in its vicinity, and that it is prepared to consider participation to the extent that existing federal government programs may be applicable. There has not been any agreement to a particular proportion of the costs nor to any particular figure.
The GO transit services in the Toronto area provide effective transportation to the residents of those communities which they serve. The province of Ontario has done and is doing good work in the development of these services, which have an

excellent reputation throughout North America. I must stress, however, that expansion at Union Station is required because of the expansion of these commuter services, which are the responsibility of the provincial government. At this time the details of the commuter program implementation have not been finalized by the government, as it wishes to consider how this program should relate to its role in the general area of urban transportation assistance and to its priorities in the light of fiscal restraint.
The question raised by the hon. member also applies to Montreal, Vancouver and all across this nation, and I hope we will deal with this important matter in the future.


NORTHERN AFFAIRS-NORTHWEST TERRITORIES-   INVOLVEMENT OF LOCAL GOVERNMENT IN PROGRAMS TO DEVELOP POLITICAL AWARENESS OF NATIVES-GOVERNMENT POSITION
Mr. J. R. Holmes (Lambton-Kent):: Mr. Speaker, on Thursday, April 28 of this year, at page 5062 of Hansard, I raised the very important issue of local government in the Northwest Territories. I have no intention of repeating the questions and responses on that particular date. However, it is quite obvious that the minister's response was self-explanatory and explained his lack of understanding regarding the issue of local government in the Northwest Territories.
Perhaps I could put the importance of that issue in its proper context by reading a Telex from the president of the Inuit Tapirisat of Canada, Michel Amarook, which was sent on March 30, 1977 to the Minister of Indian Affairs and Northern Development (Mr. Allmand). The Telex reads as follows:
The cancellation of this week's local government training workshop in Baker Lake points up once again the colonial mentality that dominates the government of the Northwest Territories.
It also reveals the territorial bureaucrats as the bumbling incompetents that they are.
We demand that the Commissioner of the Northwest Territories make public the documents and background information concerning the mandate of the territorial government to help develop political awareness among native people.
We would appreciate also a clear statement of policy from you on the rights of native people to self-determination. From the events over the weekend and during this week in Yellowknife, we can only conclude that the territorial executive is determined to hinder political development.
A statement by the settlement council of Baker Lake suggests that future responsibility for political development and local government training in Nunavut territory should be assumed by Inuit Tapirisat of Canada. If the funds can be made available to us, we will be only too glad to take on this responsibility.
We fully support the public statements that have been made by the settlement council of Baker Lake and by John Amagoalik, the director of land claims for Inuit Tapirisat.
This is just one simple, isolated incident of several with respect to the issue of local government in the Northwest Territories. I want to emphasize that there is a department of local government in the Northwest Territories. Let me quote from the employees' handbook some of the objectives of that department as follows:
To develop political and social awareness and administrative capability at the community level.
June 13, 1977

Under the heading "Programs" the handbook says the following:
The Department of Local Government is responsible for political development at the local level;-
Further on this manual, which is for the employees of the Northwest Territories, and related specifically to the issue of local government, states:
Encourages the development of political and social awareness and administrative capability enabling the people of the N.W.T. to achieve local self-government.
I want to emphasize that that policy is in existence, and that was the issue I was raising in the House on that particular day when questioning the Minister of Indian Affairs and Northern Development (Mr. Allmand).
Following a recent visit to the north it is my impression that the department of local governmemt has not fulfilled its mandate and that there is a growing alienation and suspicion directed toward the central government regarding this issue. 1 readily admit that in theory the department of local government has developed a philosophy which should accelerate the development of local autonomy but for the most part it has been counterproductive where it has been implemented. In effect, the government pays lip service to local political development and in many ways works against it. I have considerable correspondence which would substantiate that observation. There is a general absence of local fiscal responsibility, which works against the development of local autonomy in the north. Surely it must be apparent that local government will evolve into a northern form of local government, but it must suit the needs of the people in those northern communities.
Finally, the evolution of local autonomy implies the development of a proper balance of decision making capability between all levels of government, and that balance does not exist in the north at the present time. If we are to see a positive impact on the life of the local population, local government is needed. It must be there to meet the needs of the people at the grassroots level, and it is absolutely essential in this context.


Marcel-Claude Roy: Mr. Speaker, the development of local government in the Northwest Territories has long been recognized as a valuable objective within the general context of northern development.
In January, 1965, the commissioner issued a policy statement outlining the educational, political and administrative importance of local government. Essentially the policy called for the decentralization of government activity so that wherever possible local community services could be supplied by democratically elected community institutions. This was reinforced by the report of the Advisory Commission on the Development of Government in the Northwest Territories issued in 1966, which recommended a continuing and intensified program for the development of local government as crucial to the economic, social and political development of the north.
Adjournment Debate
When the seat of government for the Northwest Territories was moved from Ottawa to Yellowknife in 1967, a department of local government was established and a new, simplified method of local incorporation was provided under the hamlet ordinance. In addition, settlement councils were formed in virtually all unincorporated NWT communities so that direct participation by residents in local matters became possible. It is encouraging to note that indigenous natives now constitute the overwhelming majority of local council membership. The approximate figure is 75 per cent over-all and 90 per cent if one eliminates several of the larger population centres.
In its initial phase the territorial government's development program concentrated on raising the level of political awareness at the community level. The rapid increase in the number of local councils, however, created an urgent need for programs to be developed which would better prepare local people for an effective role in their councils. This resulted in a change in emphasis in the development program from political awareness to legal and administrative functions and the practical mechanics of local government. This change in emphasis was not accepted by a group in the department of local government, who resigned their positions when the territorial government's policy was reaffirmed to them.
I would like to comment briefly on what I understand were the objectives and concerns of that group, since they are the key to the basic issue. The members felt they had a responsibility to work with communities to bring about self-determination in the form of new structures and mechanisms of government. This implied a rejection of the existing constitutional forms of government, both territorial and local.
Neither the government of the Northwest Territories nor the federal government would deny the rights of any segment of the population to work towards objectives which they believe desirable, and that would include those seeking basic constitutional development.


TRANSPORT-RAIL LINE ABANDONMENT RECOMMENDED BY HALL COMMISSION-INQUIRY AS TO FORM OF APPEAL AVAILABLE
Mr. Craig Stewart (Marquette):: Mr. Speaker, as reported in Hansard of June 2, at page 6212, I asked the following question concerning the Hall Commission report:
Mr. Speaker, my question is for the Minister of Transport. Since certain areas of western Canada will be severely affected by the Hall Commission's proposals for rail abandonment, particularly region 4 area of western Manitoba, and since it is proposed to close some of those lines as early as December 31, 1977, can the minister say what form of appeal is available to those communities which feel the report deals unfairly with their areas?
In his reply, the Minister of Transport (Mr. Lang) stated that he was surprised that I would ask such a question. He said he understood from other members of his party that the Official Opposition gave practically unanimous support to the recommendations of the Hall Commission. He then went on to say that the usual channels of appeal were open to these communities through the Canadian Transport Commission.

June 13, 1977
Adjournment Debate
First of all, I think we should set the record straight. All parties here in Ottawa agree in principle with the Hall Commission report. However, there are some areas of this report that we and many people question. The Hall Commission report, which was recently tabled in the House, is 555 pages long. With a report of this size, there will be areas of disagreement with some of the proposals, particularly those dealing with the closure of branch lines.
I am sure that members of the Hall Commission never felt that their report would be accepted word for word. That is why I ask what line of appeal or recourse there will be for those areas that feel they have been treated unfairly. This has certainly been the case in region 4 area where the large majority of the trackage involved is located in the federal constituency of Marquette. This area loses far more lines than most other regions in western Canada.
I might add that the people in this area of Manitoba are so concerned that they have written the Minister of Transport asking him to attend a public meeting there this month. The reason they invited the minister is not to abuse him but to find out from him at first hand what way they should turn. They hope the minister will attend. Many communities are affected, communities such as Rapid City, Oak River, Cardale, Isabella, and all communities on that line as well as many others too numerous to mention.
There are several proposals in region 4 area which I question and to which, I feel, there could be sensible alternatives. In the time allotted to me today it is impossible for me to mention all aspects of the report as it affects region 4. There are several points I want to make, though.
The fact that the commission has recommended the closure of all branch lines between the CN mainline and the CP Winnipeg-Edmonton line has come as a shock to residents of this area. Already the farmers of this area have held meetings and are preparing petitions as they feel they have a legitimate complaint. They feel that through the years the railways have deserted them as far as service is concerned and now they feel their elevator companies are letting them down.
They also feel, and I have been contacted in this regard by many farmers from the area affected, that the figures presented to the Hall Commission as to the potential movement of grain on some lines to be closed are not accurate figures. As some of these lines are recommended for closure by December 31 of this year, they naturally ask where they can appeal this decision.
Another part of the report for region 4 that concerns me is the recommendation that the CN line from Neepawa-Ross-burn-Russell be transferred to the prairie rail authority. This suggestion gives me grave concern as I feel strongly that this line should be part of the basic network guaranteed to January 1 of the year 2000. By placing this line under the prairie rail authority the grain companies will then say that as there is no long-term guarantee on this line there is no need to give proper service or to upgrade elevators. Then several years down the road, when further reviews are made on this line, the grain

companies will say that, because of the condition of the facilities, it is no longer a viable operation.
Much the same has been done on the Hallboro-Beulah line that is now recommended for closure this year. These are just a few reasons why I feel there should be appeals on some of the recommendations in the report.
I cannot accept the minister's answer, and neither will the farmers of western Manitoba, that they can appeal these closures through the Canadian Transport Commission. This line of appeal has always been available to farmers ever since the CTC was formed. Not only can this be very costly to the communities involved, but they have not much faith in the CTC. The majority know that the chairman of the CTC is the Hon. Edgar Benson, a former minister of finance. They still remember Mr. Benson's white paper on taxation and they are still feeling the effects of his implementation of the capital gains tax and also the tax on recaptured depreciation on farm machinery. Most producers feel that the suggestion that they go to Mr. Benson and the CTC with their appeals is like sending them to the devil.
I am sure that if the Minister of Transport looks again at the Hall Commission report, and particularly the map showing the closures of lines in region 4, he will agree they have been far too harsh in their proposals for that area. Again I ask the minister and the government to announce a proper line of appeal and recourse for areas that sincerely feel they have a legitimate complaint in this initial report. Because of the time element involved, I would hope the minister would do this at an early date.


Ralph Goodale: Mr. Speaker, at the outset I think I should stress three points about the Hall Commission report.
First, it is apparent that the Hall Commission has done a thorough, conscientious and widely respected job. Mr. Justice Emmett Hall and his co-commissioners have established for themselves a very broad and solid base of support across the prairies and credibility for their thorough work.
Second, I think it is important to note the almost unanimous chorus of support for the Hall Commission report from farmers, farm organizations, grain companies, co-operatives, municipalities, railways, provincial governments, editorial writers, western observers and commentators. In fact, I think you could look over the history of western Canada and not find a subject where there has been the degree of unanimity that there is about this report.
Third, it is important to remember the calls for swift and positive government action in response to the Hall Commission report coming from all the groups, organizations and individuals I have mentioned. The government of Canada has clearly demonstrated its intention to respond accordingly.
The hon. member makes reference to the Hall Commission recommendations for prairie rail line revitalization, and in particular to proposals which relate to region 4 of the Hall study. The Hall Commission indeed recognized the unique
June 13, 1977

nature of region 4 and commented specifically in the report as follows:
There is no area in western Canada which is overbuilt with railways to as great an extent as the area to the north-west of Brandon bounded by the Carberry Canadian National Railways line to the north. In a space of 50 miles, the area is traversed in an east-west direction by eight railway subdivisions. There has been no rail abandonment in this area since construction. Although there has been some rationalization of the grain handling system, it has been relatively slow to occur. In the face of rapidly escalating costs of grain elevator operation, it is evident that many of the fully depreciated, physically sound facilities will be rendered uneconomical in the very near future.
Grain company managers informed the commission that in 1970 a fully depreciated elevator was economically viable if it had an annual handle of 150,000 bushels. By 1975 a handle of 250,000 bushels was required and it is estimated that by 1980, any older elevator handling less than 500,000 bushels, and any new elevator handling less than one million bushels, will be non-viable. Even drastic alterations to handling tariffs will not overcome the difficulties because larger scales and new driveways will be required for the older houses along with new longer car spots.
Just as elevators with low handlings will not be rendered viable even with altered tariffs, many rail lines with low density traffic will not be rendered compensatory even if new rates were established which would permit railways to receive higher revenues for grain haulage.
Under these circumstances, it is evident that a drastic reduction in the number of grain delivery points will occur over the next few years. This reduction in handling facilities is inevitable and in the interests of economy and improved service should be accompanied by a reduction in railway mileage.
The report went on to conclude:
In this area where alternate hauling distances are short to main and secondary main lines and where the majority of the elevators are either not viable or marginally viable, fairly drastic alterations are warranted.
With respect to the question of appeal, the point is covered by the Railway Act, sections 252 to 254. I shall be pleased to send the hon. member copies of those sections.


Mr. Deputy Speaker:: Order, please. The motion to adjourn is now deemed to have been withdrawn.
Motion withdrawn.


Mr. Deputy Speaker:: It being 6.30 o'clock, I do now leave the chair until eight o'clock p.m.
At 6.30 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.


Hon.   Otto. E. Lang@Minister of Transport: that Bill C-34, to amend the Canadian Wheat Board Act respecting the
Canadian Wheat Board Act
establishment of marketing plans and to amend the Western Grain Stabilization Act in consequence thereof, be read the second time and referred to the Standing Committee on Agriculture.
He said: Mr. Speaker, I believe it may be found on this occasion that when we come to the conclusion of second reading debate there may indeed be a disposition to proceed with this bill in the Committee of the Whole. However, that can be determined at that point in time.
Bill C-34 arises out of some issues relating to marketing of grains on the prairies, particularly out of questions surrounding the marketing of rapeseed. This has been the subject of a plebiscite in the prairies. It seems apparent that some of the producers who liked the opportunity of private marketing of rapeseed nonetheless would appreciate the opportunity to obtain an average price for their product by a pooling arrangement. In this way they would not have to attempt to play the market and determine for themselves when the time was right to market their grain, particularly their rapeseed.
For a larger producer wanting that particular arrangement, this was always possible by arranging his deliveries over a regular period of time, marketing his product at different points in time. For smaller producers, that was hardly possible. The difficulty for a producer or farmer, when he happened to sell at a low part of the market and his neighbour sold at a high part, was one of those obvious human considerations which concern many of us.
What this bill does is to make it possible for voluntary pooling arrangements to be created. It is essentially voluntary in two ways. The pooling arrangements will depend upon the willingness of participants in the rapeseed market to come forward and develop them and obtain the participation of farmers in them. This then depends upon the companies normally marketing grain-the pools, the other individual companies or groups of them-to put together a voluntary pooling arrangement.
It is then voluntary for the individual producer, who may choose to market on his own at his own time and at his own judgment of the market, to enter into a pooling arrangement so that when he has finished his year he will obtain the average which his particular pool market would have been able to obtain for the selling of rapeseed.
There is an interesting aspect here. It may be possible for several pooling arrangements to exist side by side. A bit of competitive spirit would certainly then exist. The result at the end of the year in terms of the total returns from one pool compared to others will no doubt have an impact on the willingness of farmers to deliver to a particular pool and, indeed, to enter into a pooling arrangement at all.
We are asking parliament to add a couple of features so that voluntary pools may be more effective than in the past. First, the bill permits the pooling arrangements to become part of the permit book procedure so that it is more certain that those who enter into a voluntary arrangement will remain in it. This

June 13, 1977
Canadian Wheat Board Act
is a contractual measure to which people ordinarily commit themselves in any case, but there are many pressures upon persons who join a pool, as hon. members know, especially if price changes make non-pool prices more attractive. By the use of the permit book, involving basic control over the delivery system which has, for good reason, been associated with the Wheat Board throughout its existence, we may be able to make the pooling arrangements more effective.
Second, in order to offer an advantage which is essential to both the pools and to any major holding operations we propose to allow for the setting of additional prices which will carry the same kind of guarantee from the treasury as exists in the case of the Wheat Board initial price today. This is an important provision, one which may at various times cost the treasury money, but it is designed to encourage producers who might be under pressure of some kind not to dispose of their grain outside the pool. It is another change which makes the voluntary pooling system more viable.
That is the nature of the law. It is a voluntary arrangement. No farmer is bound to enter into a pooling arrangement if he does not wish to. Many farmers who like pooling arrangements believe that the Wheat Board might well set up one in relation to rapeseed, too. Single selling is part of the Board's operation but it is not intended to create a monopoly, or monopoly selling.
The other thing to note is the reaction of the companies or others who may be interested in promoting pooling arrangements. The bill is an enabling vehicle which allows these pools to be created. It provides for an initial price and a permit book to assist in making the arrangement more effective, but the assistance of particular companies, and a good reaction from them, are necessary for its complete fulfilment. I very much hope that the wheat pools on the prairies and other companies, either together or singly, will take advantage of these provisions and move to set up pools for rapeseed so that farmers who want the average price and find it difficult to arrange their own selling without this assistance may have such opportunity.
I commend the bill to the House in the hope we may pass it here and send it to the other place for consideration so that the planning may begin and voluntary pools may be created at a relatively early date.


Hon. Alvin Hamilton (Qu'Appelle-Moose Mountain):: Mr. Speaker, I think I can put the mind of the minister at ease at the outset by saying there is absolutely no disagreement on the part of the Official Opposition as to the principles of this bill. I would commend the minister also on his manner of presentation. If he does not mind my saying this, sometimes he irritates us by the self-assurance with which he presents legislation. But tonight he was groping, as all honest men must grope when dealing with circumstances of this kind.
The history of these pools, either voluntary or compulsory, goes back 50 years in western Canadian history. I shall not bore the House tonight with all of that history but it is

necessary to understand a little of it in order to fully comprehend what the minister is trying to do.
In the early stages of marketing in western Canada wheat prices would always be high as the crop was growing. As soon as the crop started coming off the price seemed to drop to the bottom, at the very time the farmer desperately needed money which to pay taxes, pay for the operation of his farm, set enough money aside to keep him and his family during the winter months and still leave some over to pay for seeding in the spring. When most of these farmers had sold their grain the price always seemed to rise. But then they had no more left to sell.
This desperate human problem encouraged the development of the pools in the early twenties. The pools fell into trouble in 1929, 1930 and 1931. As recently as six months ago a book was published in Winnipeg giving the history of this period more authentically than any book has done before or since. The author did not finish his book-it was completed by others after his decease-but throughout this whole period he was in a unique position to understand what was taking place both as an adviser to the grain business and as adviser to governments. His name was Clive Davidson. He worked under the governments of both Mackenzie King and R. B. Bennett. This man has been forgotten by many but he has shown the dimension of the human problem and what was done in response to it by the governments of that day. What the minister was talking about when he raised the question of the voluntary pools was this. In the thirties when the pools went broke and could not pay for the initial payment, they had to borrow money from the provinces of Manitoba, Saskatchewan and Alberta. When those three provinces could no longer support the financial strain the federal government backed up the loans. As a result of this survival procedure, which was carried on from 1930 to 1932, there was general agreement to support the concept of what was eventually known as the Canadian Wheat Board. In the original bill of 1934 and again in the bill which went through the House partially in 1935, pooling was compulsory. This was fought vigorously, even viciously, if I may use that expression. This was taking away the freedom of the farmer to sell when he pleased. In spite of that, the bill got to the second reading stage, and under tremendous pressure from the opposition, the government amended the bill to make a choice. You could sell to the pool or on the market. That was the system that lasted from 1935 until 1939.
In 1939 part of the history of this parliament, which is forgotten, is that it passed four bills to get rid of the Wheat Board. Those four bills that were passed by this House to get rid of the Canadian Wheat Board were never proclaimed, because the war came along and the government of the day realized that the Canadian Wheat Board was perfect machinery to impose a system of price controls over the farmer. The Canadian Wheat Board was used as a device from 1939 and 1940 to well after the war as a system of controlling the farmers' income-the price of their grain.
June 13, 1977

Not many members of the House will remember the British wheat agreement of 1946 in which for four years we were locked into an established price based on the false assumption that there was too much grain in the world. The price was so poor that at the end of those four years parliament felt constrained to vote a sum of money in compensation to the farmers for part of the money they had lost.
This utilization of the Canadian Wheat Board as a restrictive weapon was not in the original philosophy of the Wheat Board at all. The original philosophy of the Wheat Board was simply that of a pooling device, primarily for a farmer to get an average price regardless of where he sold his grain and regardless of where he lived and the delivery took place. It was averaged out grade by grade.
Since 1949 we have had a constant debate in western Canada over the merits of the compulsory pool versus the voluntary pool. Generally speaking there will be no argument from any western member here when I say the great majority of farmers in western Canada still hold to the belief that wheat, their main crop, should remain under the 100 per cent compulsory pool. That does not mean they are 100 per cent happy with the operation of the Canadian Wheat Board. It means, on their main product, they are content to take this discipline of the pool as being better than going back to the ups and downs of the market mechanisms around the world.
The price is supposed to be set, as far as Canadian wheat, Australian wheat and Argentinian wheat are concerned, by their respective wheat boards. They are supposed to calculate the amount of grain on supply around the world. They are supposed to calculate what the demand is going to be. They then try to set a price which they think will give the best price to the farmer over the whole crop year of selling. Occasionally they make mistakes, and I suspect they made a mistake last September. Only time will tell. That is how the Wheat Board operates. It does not actually sell wheat. It is simply a price setting mechanism to meet the farmers' main demand-that they get an average or pool price.
Turning to this question of voluntary pools, a good many farmers in western Canada maintain honestly and sincerely that all grains produced in western Canada should be under the compulsory pooling of the Canadian Wheat Board. Their arguments are well known. Since we have accepted this principle for wheat, likewise why not accept it for all grains to be absolutely fair to everyone? However, in view of the plebiscite, the minister knows that the great majority of farmers, even though they accept the compulsory pooling of the wheat, are reluctant to go into compulsory pooling of the other cash crops-oats, barley, feed wheat, rapeseed, flaxseed and so on.


An hon. Member:: What do you mean by "oats" and "barley"?


Francis Alvin George Hamilton: Oats, barley, feed wheat and so on are their cash crops. The decision of the minister in this bill is not only sound politically but it has a rationale of economics behind it. The rationale of economics on rapeseed is that there is such a difference between the price
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you get in some years when you sell eastward and the price you get when you sell westward. I do not have a list of comparative figures for each year, but one year, for example, the difference was almost 90 cents, if you were in that part of the west where you could ship your grain westward as opposed to eastward. Each year the difference can vary a great deal. Some of the difference is caused by the freight rate structure, but mostly it is because of where the market is. Therefore, there is an economic argument that those producers who produce rapeseed feel that justice demands, if you are in Alberta or Manitoba, that you should get the same price for an equal product. That is a good argument for equity and fairness; there should be a pooling.
The other argument which the minister mentions is sound and fits in with those who want an average price over the year, as opposed to taking their chances on the day to day quotations on the value of that grain. Even though I have said the great majority of the farmers do no want all grains on a compulsory pooling, a good proportion will go for the voluntary pools, because they feel there is still going to be some competition in the voluntary pools under this bill.
We have several companies which sell rapeseed. Some are privately owned and deserve credit, because they are the ones which went out and developed the markets. Approximately 20 years ago rapeseed was a minor grain from western Canada. Due to the research done by the National Research Council here in Ottawa-the work was actually done in Saskatoon- the difficulties we had in selling our rapeseed have been overcome. It is now suitable to make margarine or a vegetable oil for which there is an insatiable and increasing demand around the world.
There are also private companies and co-operatives, and even if they got together, as the minister has suggested, there would be competition in selling. The price will still be set by supply and demand because the people who set supply and demand prices do so primarily on statistical evidence of past records, potential demands and supposed supply. But they have made serious blunders. The information is computerized and is disseminated worldwide. As I have pointed out many times across the country, the Chicago exchange, with all its boasting, can go so far wrong that it did not even know in 1971 and 1972 that the world was out of wheat. The wheat price sank to about $1.60 for our top grades. A year later Canada and the United States were out of wheat, and the price went up to $5 and more.
The point I am making is that the ordinary farmer, who has little or no time to worry about world supply and demand or to read all those sheets of information he gets, which half the time are wrong, would rather take an average price over a series of years so that he can concentrate his time and effort on farming and not on trying to market. On the other hand, there are other farmers who want all the cash they can get at the time they need it. Some seem to have a sixth sense when they sell. These people would probably want to take their chances

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on selling on the cash price basis. So this legislation meets the demand of those who believe that compulsory pooling is sound. It also meets the demand of the farmer who would like to have a little freedom to make his own decisions on when he buys and sells. This voluntary pooling allows for that.
I think the minister is quite right when he says that there has to be some discipline in the pool. In the first place the great danger with pooling is that you pay that initial price, and if the world price drops below that initial price for a good part of the crop marketing year, there could be tremendous losses. Therefore, there has to be some form of financial responsibility for that initial price, and this the government has assumed in this legislation, as I understand the minister.
That is why I said at the beginning that Her Majesty's Official Opposition approves of the principle. This plan would not work without that financial guarantee. Second, the permit book means that a contract is made and that the farmer knows that for that year he is in the pool. He cannot keep changing his mind every six weeks. That will cause a little bit of static because every so often the price is going to go soaring up. At that time he will want to be on the free market so that he can get the advantage of those soaring prices. However, once he signs with the pool and has his permit book, he is locked in for that year.
With those two points of discipline and the new features, as the minister calls them, I think these voluntary pools have a fairly good chance of working. I asked, because I did not know the answer, what about the financial responsibility beyond? As I read the legislation, the minister and the governor in council have to be assured that the plan proposed by the private company, the co-operative, by a group of them or by a new company, is soundly worked out so that they will be able to do the things that the pooling operation demands-pay their costs, pay the interest costs and all the rest of it-and then pay the amount which is left over on a fair basis to each of the members of that pool. Those who are not in the pool will take their chances. They will sell and take the price which is paid on the day they sell, so they will feel fairly satisfied.
There are a couple of other little points, but I think they are important. The development of rapeseed as a cash crop in western Canada has not only served the northern districts of our provinces well by providing them with a type of crop which does well in northern climates, where there is higher productivity but great risk because of the shortness of the season, but it has also met a great need all over the world. As I look over the various products which can be produced in the world, I do not find one of them which has a better future than oilseed crops, whether produced in Canada or any other place. As a matter of fact, I keep looking at the clay belt of northwestern Quebec and northeastern Ontario and wonder why all that good land lies idle when the world so desperately needs what that land can produce in the form of oilseeds. I look at other places in Canada and visualize the possibilities we have not only with rapeseed production but also with the other crops to produce the things Canada and the world need. This is not a

time for a long series of remarks on that. These items may be small today, but they are going to be big in the future.
I think I speak for my whole party when I say that the principles of this bill are good. We cannot say for sure that it will work perfectly because I can foresee the difficulties which are going to arise. I think the way the act is set up is sound. It meets the main difficulties. If we go into Committee of the Whole, I hope the minister will be able to respond to some of our doubts and questions about some of the clauses. All they can be at the present time are doubts and questions because we really do not know until the legislation has been tried.
I think this parliament would serve the country well by allowing this amendment to the Canadian Wheat Board Act to go forward, looking on it as a broadening of the activities of the Canadian Wheat Board, in keeping with a principle which I think is current with the majority of the farmers of western Canada. They want wheat kept as a compulsory pool, but on the other products they are of divided mind. I think this meets the demands of both sides of that argument. The argument is sincere and well discussed. It is not a question of something strange. Western producers know the arguments on both sides, and I think this is a pretty good effort to meet what the people want for this particular product, rapeseed.


Lorne Edmund Nystrom: Mr. Speaker, the bill before us today, Bill C-34, is one which urban members might think is rather boring, but I want to start off by saying to them that if it were not for the oilseed industry and the grain industry in Canada, this country would be a net importer of food. If we took away the proceeds from oilseeds and grain, last year we would have had a deficit of some $1.9 billion in food products, which is really quite startling for a country with the acreage and the small population we have. So one of the important industries we have is the oilseed and grain industry.
Bill C-34 amends the Canadian Wheat Board Act provisions dealing with oilseeds, particularly rapeseed. How that commodity is marketed is important to rapeseed producers. There have been many discussions and arguments for many years about rapeseed and how we should be marketing it. Voluntary pooling, which has not played a significant part in the prairie farm marketing system since 1931, may take on a major role in rapeseed markets under the proposed legislation we are talking about today.
On January 28, 1977 the minister responsible for the Canadian Wheat Board introduced Bill C-34 to provide for voluntary pooling of rapeseed and other non-board grains. The bill proposes changes to the Canadian Wheat Board Act to allow associations or firms of producers, processors or traders to set up voluntary pools approved by the minister and to receive federal government guarantees for 90 per cent of the initial payments against pool proceeds.
Other provisions in the bill amend the Western Grain Stabilization Act to bring commodities marketed through approved voluntary pools under that act. Although Bill C-34 allows for the implementation of voluntary pools for other non-board grains, government spokesmen have concentrated
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primarily on the question of rapeseed and their proposals for the rapeseed industry. Spokesmen for major grain traders and the government are agreed that it is extremely unlikely that pools will be set up for other non-board grains. Therefore, we should be directing most of our comments toward rapeseed itself.
Other grains such as rye, flaxseed and buckwheat are not produced in large enough quantities to make a pool practical. There are few major buyers. In the case of buckwheat, my understanding is that there about three major buyers in this country, and much of the crop is forward contracted. A voluntary pool is now operated for sunflower seeds by the CSP plant in Altona, Manitoba, which is the major buyer of this commodity. Other companies, notably the company the hon. member for Regina-Lake Centre (Mr. Benjamin) talks about a lot, Cargill Grain, make occasional purchases, usually at the top of the market.
This proposed legislation would enable the implementation of voluntary pools for domestic feed grains-feed wheat, oats and barley-which are now part of the Wheat Board's compulsory export pools.
Since Bill C-34 deals mainly with the question of rapeseed, I think I should turn to rapeseed for a few moments. The demand for compulsory pooling in rapeseed has grown up to a point where a vote was held some three or four years ago which showed that 46 per cent of rapeseed producers wanted rapeseed marketing through the jurisdiction of the Canadian Wheat Board. I suspect that in my constituency, which is a representative area of rapeseed growers, the percentage has increased since the vote was taken some time ago.
Rapeseed was first grown in Canada in 1943. It dies out after the war, but reappeared again in 1955. In 1971 the crop hit a record 95 million bushels in Canada-a spectacular rise. Rapeseed now accounts for 7 per cent to 10 per cent of the Canadian farm income from field crops. However, the production remains very volatile. Even now in the 1970s annual production figures have risen or fallen by 20 million bushels four times since 1970. The returns to the producers have also fluctuated with the rise and fall in the production of rapeseed in our country. For example, if you go back to 1971 you will Find that the smallest production of rapeseed was in the crop year 1974-75 when some 41,217,000 bushels of rapeseed were produced. Meanwhile, in 1971-72, 69,838,000 bushels of rape-seed were produced in Canada.
The price of rapeseed to producers also fluctuated almost as widely as the production of rapeseed itself. In 1971-72 it was $2.16 a bushel to the farmer. Four years later it was $7.06 to the farmer. A year later, in 1975-76, it was $5.10 to the farmer-a great fluctuation in the price the farmer was receiving. In the August and November period, for example, preceding the rapeseed poll in December 1973 which I referred to where 46 per cent of producers wanted rapeseed marketed through the Canadian Wheat Board, Winnipeg prices showed a spread of $2.64 a bushel, ranging from a high of $6.80 on
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August 14 to $4.16 on October 2. So you can see that there is a great fluctuation in the price that rapeseed producers get for their commodity, making it difficult for many of them to plan their production, in terms of their incomes and their expenditures, for the operations they are trying to run.
Canada's export position in rapeseed is quite unlike that in wheat. This country controls between 17 per cent and 25 per cent of the world's wheat export crop. The only major competitor that wheat has in world food markets is rice, the annual production of which is usually about the same as wheat. This gives the Canadian Wheat Board appreciable leverage in world markets and makes it easier for them to compete in world markets and to plan ahead.
On the other hand, Canadian rapeseed faces stiff competition from soybeans, peanuts, cottonseed, sunflowers and palm oil in world markets and at home. Processors are relatively willing and able to switch from oilseed to another if price differentials arise, and they make that switch quickly.
Rapeseed accounts for only about 6 per cent of world oilseed production, which is a small percentage. The market is keyed to soybeans; soybeans make up half the world's oilseed supply and 80 per cent of international trade. The market for soybeans, to make things worse, is notoriously volatile.
Canada's position as the world's leading exporter of rape-seed-a 70 per cent share in four of the last five years-is neatly checked by Japan's position as the leading importer, and their share has grown to 70 per cent over the last Five years. When the rapeseed debate was going on, both sides in that plebiscite, campaign or debate, cited Japanese opposition to compulsory pooling as an argument for their side. The Rapeseed Producers' Association of Canada argued that producers could not afford to alienate their best customers; the three pools argued that the Japanese position proved that pooling would increase producers' bargaining power.
The pools were outraged when the Minister in charge of the Canadian Wheat Board (Mr. Lang) proposed the operation of a voluntary pool during the plebiscite campaign, when the people voting thought they had a clear choice as to what they wanted to do in terms of marketing their commodity. But part way through the campaign the minister changed the rules of the game. The co-ops felt that the promise convinced some of the wavering producers to stick with the open market in order to try to reap the benefits of both systems. It is like what my friend the hon. member for Regina Lake Centre (Mr. Benjamin) would say, that they wanted to be half pregnant; they wanted to benefit from both the systems. That is one of the reasons why it was voted down.
Whether or not the minister's timely announcement affected the result of the voting is unsure, but it had an impact. Producers did reject compulsory pooling. Only 46 per cent of them voted to market their product through the Wheat Board. Now, more than three years later, the minister is finally making good on his promise to bring about voluntary pooling.
The bill itself allows for the implementation of two types of voluntary pools. In the case of street price averaging, pro-

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ducers could opt to have a portion of their street price retained by a pool and averaged for a final payment. There is some controversy over whether this is really a pooling proposal. Price averaging can now be done by timing deliveries through the crop year or to forward contracting. This proposal does not seem to add much to the marketing system or hold any benefits that producers cannot already realize in other ways. In the case of full pooling, which is the other type of pool, proceeds from contracted deliveries would be pooled and producers would receive initial and, theoretically, final payments.
The possible benefits of voluntary pooling for rapeseed should be examined when we are debating the bill before us today. Since pools would bear at least part of the marketing risks normally handled by the futures market, the amount of hedging on this underspeculated market would drop. This could improve the market's performance and end chronic inversions.
The formation of producer groups might bring pressure on the Wheat Board to give higher priority to rapeseed in the allocation of quota and grain cars and so improve the handling of rapeseed. However, the board now attempts to match deliveries to sales, and further concessions to rapeseed producers could lead to a backlash from other commodity groups. The formation of pools by associations of producers who are not currently marketing rapeseed could lead to a growth in the quantity and quality of marketing information and expertise in the trade.
The effect of voluntary pools on market development would depend on their size. Small pools would do little or nothing to develop new markets; the best development work could be done by a single large pool that could afford the associated costs. That is why I argue that we should have rapeseed marketing under the authority of the Canadian Wheat Board. The difficulty of predicting annual patronage would work against long term marketing plans of these small pools.
However, if pool periods are set at, for example, three to five years, the pools could engage in longer term forward contracting with major customers. But the past history of bootlegging-this was a real problem for many years in the prairies- and the likelihood of it reoccurring, make long term sales contracts a risky proposition. I am referring, of course, to the bootlegging of grain.
One of the main features of Bill C-34 is the imposition of stricter delivery enforcement measures. Bootleggers would face conviction under the Canadian Wheat Board Act rather than civil suits if they were caught, and inspectors would be designated to check that producers whose permit books were endorsed for a voluntary pool delivered to that pool.
This provision sounds more meaningful than it is, however. The government's intention now is to appoint a couple of inspectors, probably part time, for the whole prairie region. We all know how large the prairies are. It would be a difficult task for a small army of inspectors to prove beyond a reasonable doubt that bootleggers' yields had not indeed varied between pool and open market acreage. Even when producers

are suspected, the establishment of their guilt in criminal court would be, if anything, more difficult than in a civil suit.
Voluntary pools would remove seasonal fluctuations from producer prices. They would be relatively unable to stabilize rapeseed markets unless a single pool or a few large pools were able to exert market pressure. Given the nature of the international oilseeds market, this effect would be marginal at best unless most or all of the Canadian crop was jointly marketed. However, additional expertise and effort in marketing would in theory have a positive effect on producer prices.
Producers would benefit if organizations competed to maximize returns to members; elevator companies might cross-sub-sidize voluntary pools to attract patrons, although that seems highly unlikely from their current attitude. However, these benefits would be temporary and would place pools without the resources of the elevator companies at a serious competitive disadvantage.
Pooling would definitely give producers increased bargaining power with domestic crushers and could raise returns from that sector. But this could force marginal processors-already facing substantial transportation disadvantages to compete even in eastern Canada-out of business.
On the other hand, Bill C-34 gives processors the right to create voluntary pools. Processors will probably be the first to set them up, either in self-defence or to gain a competitive edge over their rivals. The possibility of conflicts of interest if crushers operate pools and continue to buy on the open market is real. Some of the new crushing plants are in desperate financial straits and may try to use voluntary pools to lower their seed-buying costs.
Similarly, elevator companies would face conflicts in assigning sales to pools or their own stocks. The temptation would be to assign high-priced sales to company stocks and low-priced sales to the pool. This creates another problem for this House and members of the Standing Committee on Agriculture which should be looked at very seriously before legislation is passed to establish voluntary pools.
However, firms operating pools could require a producer board to make all marketing decisions or could pro-rate all sales between pool and open market stocks. These devices would reduce the possibility of conflicts. The costs of operating voluntary rapeseed pools are not yet known. I do not think the government or the minister could hazard a good guess as to what the costs will actually be. To my knowledge, government officials have not attempted to cost voluntary pool operation. It is clear, however, that the larger the pool the smaller the per-bushel operating costs will be. Logically, a single pool operated by the Wheat Board-that is the argument this party has made for many years-which already has the necessary accounting systems in place, would show the smallest operating charges and would make the most sense for the country and for the producers.
The most important aspect of the bill is the provision for federal government guarantees of 90 per cent of initial payments. This could bring stability to the rapeseed market and
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encourage production. However, if history repeats itself, the pools will be marketing residual deliveries and will stabilize prices at lower levels than they could theoretically realize.
Initial price setting in the complex oilseeds market will be a difficult task; it will be more difficult if pools do not have the market power-that is, size-to be able to withstand pressure to sell below initial prices. Large well-funded pools could wait out low prices; small ones would have to take their losses or face bankruptcy from mounting storage and carrying charges.
The complexity of the international and domestic market is a key consideration. The additional flexibility that voluntary pooling would add to the system is accompanied by a great deal of additional complexity. The benefits of voluntary pools must be more than theoretical to justify this added complexity.
Bill C-34 adds complexity not only to the rapeseed market but to the non-board grain markets as well. Although current conditions make the operation of voluntary pools in domestic feed grains unlikely, conditions will change and pools would be set up if opportunities for profit existed. If opportunities for profit are not there, I am sure the pools will not be set up by crushers or Cargill or anybody else who wants to make money from the hard labour of the farmers.
This raises the possibility of the federal government guaranteeing 90 per cent of the losses of a privately-operated pool competing with a government agency. Here we have a privately owned pool established by the government to compete with the agency of the government, the Canadian Wheat Board. That does not make sense. Again it is more unnecessary complexity at an unthought of benefit-or cost-to producers. We should be looking after the producers and not creating fatter bank accounts for the crushers or Cargill.
Voluntary pooling will introduce additional complexity and potential conflicts of interest into the prairie farm marketing system and return unproven but at best marginal benefits to producers. The greatest benefits may indeed go to producers who continue to use the futures market.
Perhaps this is one of the reasons behind the bill. Does the minister hope more and more producers will go to the futures market, weaken the authority of the Canadian Wheat Board, weaken orderly marketing and then one day we will all wake up and he will be able to say that very few people are interested in the Canadian Wheat Board and orderly marketing so perhaps the board should cease to exist? I am sure the minister or his advisers have that in mind as an objective when they introduce a bill such as this.
Returns for pool patrons would be maximized and most development benefits realized by a single pool marketing all or most of the crop and with the market power to overcome rapeseed's relative insignificance in the oilseeds trade. However, when producers voted against marketing their crop through the Canadian Wheat Board they essentially rejected the single-agency approach.
Bill C-34 attempts to solve the problems that have led to historical failures in voluntary pooling. However, while it changes the rules, it does not change the game; the basic
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causes of past failures remain. When the government introduced the bill I think they forgot some of the lessons of history I went over in my remarks this evening that made voluntary pooling a failure in the past. The attempt by government officials to reach a compromise is the creation of a beast, and 1 think is worse than either of the two options open to the farmers. Bootlegging could only be controlled by a compulsory board. The readiness of producers to deliver to outside pools to maximize returns will not magically evaporate.
Rapeseed producers had 40 years of Canadian Wheat Board experience to examine when they voted in the 1973 plebiscite. At least some of them wanted the best of both systems-I think that is what the minister is trying to provide tonight- and that is one of the leading causes of voluntary pooling failure. Voluntary pools, if they are implemented under Bill C-34, are likely to fail again as they have failed before.
For these reasons I oppose the bill, Mr. Speaker. I urge the minister to consider very seriously the changes we have argued for in this House in the past, namely that all prairie grains be marketed through the Canadian Wheat Board and all prairie farmers share the risks and share the profits from marketing their crops. A society develops through working together in this way. When we examine the record we find that voluntary pooling has been a failure in this country; it is not likely to succeed for rapeseed when it has failed in the past for other commodities. I therefore look forward to asking the minister questions in committee and, on behalf of this country's rape-seed growers, hearing him clarify some portions of the bill.


William Gordon Ritchie: Mr. Speaker, let me say at the beginning that I support the minister on this bill. Perhaps it is not the solution everybody wants, and it may please few, but at least it is an attempt to satisfy those who, in the rapeseed plebiscite, showed some interest in pooling rapeseed production. They want to set up some mechanism for pooling. Representatives of grain handling companies told me in private conversation they would be willing to look favourably on a pooling system and, if enough people are interested, it could succeed.
We have only four or five large grain handling companies in western Canada, the three pools, UGG, Cargills, a private company, Pattersons, and a couple more. Farmers through their organizations control between 75 per cent and 80 per cent of all grain handled in the west. Since farmers control so much of grain grown, I see no reason why they should not if they wish set up a voluntary pool system. I cannot say how effective it will be, since if the farmers were to use only one pooling system or the Wheat Board to sell their rapeseed, production would drop off, as would sales.
Rapeseed is fairly widely grown in the west and sold on the open market. Despite the disadvantages of the open market, some farmers prefer to sell on it, including those who have the Wheat Board market their wheat, barley and oats. They recognize, as the hon. member for Yorkton-Melville (Mr. Nystrom) said, that rapeseed forms only a small part of total

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world oilseed production. Most vegetable oil comes from soybeans, and the price of rapeseed oil bears some relation to the price of soybean oil. Both soybeans and rapeseed contain meal and oil. Sometimes oil prices are high; sometimes meal prices are high. Sometimes the prices of rapeseed and soybeans appear out of line; but this happens when the price of soybeans fluctuates for oil and meal, or vice versa. Some tropical countries, including Malaysia, produce coconut oil and palm oil. Perhaps these oils will be serious competitors for rapeseed and soybean oils. Most of these palm oil plantations have been financed with American money and American farmers are asking why their money is being used to produce a product which competes with soybean oil. Vast acreages in Brazil are being cultivated for soybean crops. Clearly, rapeseed by itself does not command a market. On the other hand, demand for our wheat is strong.
Hon. members have related what happens to wheat prices when wheat is in over-supply. The United States and Canada control about 70 per cent of total wheat exports; therefore on the face of it it should be easy to draw up some commodity agreement. But past experience shows that commodity agreements do not work. For instance, the last time the Wheat Board held an umbrella over our wheat market, in 1968 or 1969, I think, our competitors quoted two or three cents a bushell less and took all our orders.
No one mentioned, I think, how we establish market price, or how the price discovery mechanism works. At present prices are determined on the Winnipeg Commodity Exchange, but those prices bear a close relation to the soybean market in the United States. As I said, rapeseed and soybean prices are not interchangeable or necessarily comparable, because one may sell for its oil and the other for its meal. I understand that only on the Winnipeg Commodity Exchange is there a futures market for rapeseed. If trading in the commodity should end because not enough is traded, I suggest the market price of rapeseed could go down.
In addition, we should have no price discovery mechanism. The Canadian Wheat Board uses the Chicago grain futures and futures posted in Kansas City and Minneapolis for its price discovery mechanism. The board phones Chicago about every ten minutes to see if wheat has gone up or down, and posts its prices accordingly. Canada has an excellent reputation for selling wheat of high quality. Although world wheat marketing has changed, people prefer to buy some of our premium wheat over American redspring and Australian wheat. Our wheat is among the best in its class, and has high protein content.
What sort of people grow rapeseed? From my experience, the rapeseed grower is usually interested in trying a new crop and selling it himself. Many farmers are content to grow wheat, haul it to the elevator, let the Wheat Board sell it, and go back to the land to grow some more. Rapeseed growers seem more interested in raising a special crop, harvesting it and selling it themselves. Rapeseed needs more husbanding than the wheat or coarse grains we grow on the prairies. You must harvest it more carefully, be more careful when using

herbicides, and careful when determining selling time. Many successful farmers of my area who grow rapeseed and flax feel they can do better with those crops than with wheat or coarse grains whose price the Wheat Board sets.
Since wheat tends to be grown on land used for summer fallow, it follows that wheat should give the farmer a higher return than oilseeds which tend to be grown as a second crop and not marketed through the Wheat Board. Theoretically, oilseeds should bring the farmer a smaller return. But those who follow these matters have discovered that, generally speaking, the oilseed grower realizes somewhat more than if he sold wheat, barley and oats. This is significant. It indicates that, as far as oilseeds are concerned, the open market provides returns in line with what the Wheat Board can do with wheat. The return is comparable to growing wheat, at least in the area that I represent.
Considerable difficulties will arise with the voluntary system. A grower who selects a pool may be quite happy at the beginning of the year when he receives his initial payment. What happens as the year goes on and the price goes higher than he expects to receive from pooling? It does not matter to him that he may have sold quickly and was guaranteed an initial price. It does not matter that he took advantage of that. When the price goes up, he will be unhappy that he did not hold off joining the voluntary pool and instead sell on the open market. Human nature being what it is, you always expect to get the highest return possible. Those who sold their grain or rapeseed early in the crop year may realize a reasonable price. It may have been low, but they have received their money for it. Those who hold their crop take a chance as to whether they are going to receive more later in the year.
The problems raised by the hon. member for Yorkton-Mel-ville (Mr. Nystrom) with regard to bootlegging are quite real. They are also real in the Wheat Board's handling of wheat, oats and barley when there is an oversupply.
As for the previous situation with regard to barley, a parliamentary committee was set up to study whether barley was being bootlegged, being sold from farm to farm at lower than the elevator price. The answer was that there was an oversupply of barley. Farmers were glad to get rid of it at any price. There is no point having a high price for a particular grain unless you can sell it.
There will be this problem of so-called bootlegging. It may be that two farmers will set up a scheme whereby one will join the pool and the other will not. They can take advantage of the situation, selling whichever way is the most advantageous, either through the pool or selling non-pool.
There is also the question of advancement of initial payment. From reading the bill, I assume the government will be involved in some sort of underwriting of an initial payment. I do not see how the pool would be able to guarantee a high initial price without running some risk. In a highly volatile oilseed market, there could, on occasion be disastrous results if the initial payment is set too high. On the other hand, if the
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payment is not set high enough, there will be no one interested in joining the voluntary pools.
I believe these problems could be worked out. There could be a modus vivendi whereby those who want to pool will have an opportunity to do so. Perhaps with time and experience the problems that arise could be worked out and the scheme made to work. 1 know that many oilseed and rapeseed producers prefer the open market. The plebiscite showed that. I am not averse to having this pooling.
This bill is not the perfect solution. It is experimental and possibly visionary. At least it is an attempt to come to grips with the problem of 200,000 or so permit holders with different ideas as to how their grain and oilseeds should be marketed.


Mr. Les Benjamin (Regina-Lake Centre):: Mr. Speaker, after listening to the minister and the two speakers from the official opposition, I have reluctantly to conclude that there are still people around who do not learn from history. They do not profit from experience whatsoever.
1 listened to the spokesmen from the government and official opposition expound the beauty and advantages of the open market ad nauseam. When the majority of the grain producers vote for the open free market, who are the first ones to run into this House saying they want a 90 percent guarantee of the initial payments of the voluntary pools? My free and open market friends. Where is the free and open market they say is so good?
How come that great commodity exchange and the great free open market for rapeseed and flax and other grains is so beneficial to the farmer? Why is it necessary to have voluntary pools which will sell that rapeseed on the open free market which, according to the government and the official opposition, is so beautiful? Both of them feel it should have a 90 per cent guarantee of initial payments against pool proceeds.
I thought this free and open market that the majority of rapeseed producers fought for was the be all and end all. That is what I thought from listening to the Liberals and Conservatives. In this legislation we have nothing more than the government, supported by the official opposition, shoring up commodity exchanges and oilseed speculators. It has little or nothing to do with the protection of the incomes of grain producers. It cannot succeed in light of the history of voluntary pools.
If the government were genuinely sincere about their support for the Canadian Wheat Board and the free and orderly market, they would quit trying to have it both ways. The government and the official opposition like to run on both sides of the street at once. They talk out of both sides of their mouths at once. They want wheat, oats and barley under the Wheat Board, and flax, rye and rapeseed on the free market. They want to have it both ways. The government will put up a guarantee in order to shore up their friends on the commodity exchanges. I question their motive and sincerity. I certainly question their logic.
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I am disappointed in the failure of the government to study the history of voluntary and contractual pools in western Canada since 1921. Voluntary pools are marketing pools in which membership is not compulsory as it is under the Canadian Wheat Board. They will be required to deliver all or part of their production by means of contracts. In this case I presume it will be signatures and permit books. I thought it was to be a voluntary pool. If it is a voluntary pool that the government and the official opposition want, why do they bring in that old bogeyman and make it compulsory? If you can volunteer in, why can't you volunteer out? Again they want to have it both ways. They want to talk out of both sides of their mouths. They are all for orderly marketing; rape boards are a great thing. They want voluntary pools with government guarantees to shore up the free and open market system.
Voluntary quotas assume the existence of some contractual delivery obligation on the patrons of that pool and Bill C-34 would oblige. Where is the "voluntary"? The bill obliges producers to deliver to their voluntary pool once they have joined. If you can volunteer in-I ask the question again-why can you not volunteer out?
Volunteer pools have risen and fallen before on the prairies. The most spectacular rise and fall was that of the wheat pool in 1923 to 1931. The voluntary pool was established then in the hope that it could recapture for the producers some of the benefits they had enjoyed under selling agencies during and right after the first world war. Then they had compulsory orderly marketing and it was felt that by having voluntary pools, starting in 1923, they could get the same benefits.
Well, what happened? The Canadian Wheat Board had removed seasonal fluctuations in prices to producers by pooling returns for the whole crop and making initial and final payments. Initial payments had also reduced the farmers' dependence on banks for operating capital. In 1921, a year after the Wheat Board was abolished and futures marketing had been reinstated, the average price to producers was down by 85 cents a bushel, a drop of 34 per cent from the previous year.
Producers in those days were more than even convinced that speculators were robbing them and the then premier of Saskatchewan, W. A. Martin, asked former Wheat Board chairmen James Stewart and F. W. Ridell to report on the prospects of voluntary or contract pooling. Their report cautioned that no voluntary or contract pooling would benefit producers as much as one compulsory pool such as they had experienced under the Canadian Wheat Board during the first world war. The report said voluntary pools could reduce seasonal fluctuations in producer prices and were worth a try. They pointed out that three-quarters of the prairie wheat corridor crop was marketed in one quarter of the year when prices were chronically depressed, and that more orderly marketing would increase the price to producers. Consumers would benefit as well, they said, because flour prices were tied to wheat prices. Consumers were buying flour made from low-priced wheat at

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high-priced wheat rates later in the year. I submit the same thing could and would occur with rapeseed products.
Both Stewart and Ridell proposed voluntary pools as opposed to contract pools operating alongside the open market. They said contract pools would be too difficult to implement because farmers would not want to sign up for an untried system. Well, they were wrong about that. Contract pools were implemented in 1923-24, when the price of wheat was down $1.43 from its Wheat Board high. The pools merged and eventually claimed 140,000 members selling half the western wheat crop to a central selling agency. Prices bounced up 65 cents a bushel in 1924-25 and remained 20 to 30 cents a bushel higher than the free pool open market prices until the record crop year of 1928 was marketed for just a little less than the 1922 crop. With the onset of the depression and falling grain prices, the pools ran into insurmountable difficulties. They were unable to realize sufficient returns to make initial payments without borrowing from the government. This saddled the three farmer-owned co-operatives with debts they were unable to pay off until 15 years after that voluntary pool system went broke.
Under this pressure the pool was forced to lower initial payments and it became clear that patronage for new pool periods was sure to decline. Producers reneged on delivery contracts in massive numbers. Bootlegging was not new, Mr. Speaker. In 1926 when Saskpool officials estimated they had 80 per cent of the province's wheat acreage under contract, they received 56 per cent of the deliveries. And that was a so-called voluntary pool, Mr. Speaker.
Some members delivered to the open market when they felt returns there were better. That reduced the pool's ability to maximize returns for all pool members. Although the pool did not survive, it did contribute to economic growth and development in those years, 1923-28. It certainly removed seasonal fluctuation from prices paid to patrons and it appears to have raised prices to producers substantially over what they might have expected from the open market during that five-year period. As a result of that experience, pressure from grain producers was certainly increased-politically, that is-for compulsory pooling and the return of the Wheat Board by educating farmers in the advantages of single desk selling and of collectively extending their risk-taking further into the marketing system to reduce those risks and maximize their return.
The pool of the 1920s, Mr. Speaker, pioneered in the field of market development as a central selling agency. It bypassed the Winnipeg Grain Exchange. It sent agents overseas to promote direct sales to major customers. It contributed to the development of co-operatively-owned storage systems to reduce handling margins paid by producers. The number of country elevators owned by the three provincial wheat pools increased from 119 in 1925 to 1,650 in 1931. That was when the co-operatives controlled one-third of the country's terminal capacity. Those figures represent a substantial part of the 1,667 country elevators added to the system during the life of that pool during the 1920s.

Let me turn now to a little more recent history. Those provincial pools tried again to return to voluntary pooling in 1959 when they were looking for a tool to encourage rapeseed production. The various voluntary pools achieved an initial 40 per cent sign-up, but four years later patronage had fallen to 18 per cent and the pools were dissolved when the Winnipeg Exchange opened trading on Vancouver rapeseed futures.
Again there were serious problems of bootlegging to the open market where prices were higher. Bootlegging was done through whom, Mr. Speaker? I wonder whether the Minister in charge of the Wheat Board (Mr. Lang) or the hon. member for Qu'Appelle-Moose Mountain (Mr. Hamilton), were he the minister, would implement the provisions of this bill in the knowledge that bootlegging will again be done as it was in 1959. How? Well, through members of the same family; through neighbours; through friends. I can see the Minister in charge of the Wheat Board ordering his inspectors to press criminal charges against members of a rapeseed grower's family or his neighbour or friends. I wonder whether the hon. member for Qu'Appelle-Moose Mountain will gallop around the prairies with him insisting that criminal charges be laid when these people want to volunteer out of a pool they volunteered into.
Some producers contracted only part of their crop to the pool and then claimed that yields had been higher in fields planted for the open market. Little has been written about rapeseed pools but spokesmen from the farmer co-ops say the pools were both unable and unwilling to force patrons to honour delivery contracts. Litigation would have been timeconsuming and expensive. It would also have alienated producers who delivered other commodities to co-operative elevators. The pools have been regarded as a development tool. Whether or not they continued to increase production or not is, of course, questionable. In their first year of operation the value of rapeseed rose 60 per cent to just over $2 a bushel and in the following year production tripled. But prices had been higher in pre-pool days and production in the last two years of the pool operations dropped back to the same level they were in the 1956-57 crop years. That experience has soured the farmer-owned co-operatives against voluntary pools.
The Alberta Wheat Pool vice president, Mr. Alan MacPher-son, has said that their co-operative has had other bad experiences with voluntary pooling for porridge seeds. In some years the co-operative offered only pool buying, and others operated a pool and bought outright as well. In either case the result was the same-the open market got high price seed and the pool got low price seed. These pools will not be offered again by the co-operative owned elevator companies.
Another example is the CSP voluntary pool for sunflower seeds, which continues to operate at the Altona crushing plant.
I hope the minister does not try to hold it up as a great example. Mr. Sarsons said that this system is not really a pool. Since the Altona mill is the only crusher, the operation is really a forward contracting operation with price averaging.
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The Altona operation does exhibit a common characteristic of voluntary pools. Outside buyers make one time buys at the top of the market, and that reverberates throughout the system and leaves the pool buying the residual. Mr. Sarsons states that the CSP pool "does not work very well" and would be a poor model for rapeseed marketing. The cost of operating the pool is not allocated or reported back to producers but is part of the overhead of that plant seed buying program.
Some 50 years later, after Mr. Stewart and Mr. Riddell reported, the rapeseed marketing commission remained convinced that voluntary pools could operate alongside the open market. The commission reported that despite the history of voluntary pools, voluntary pooling for rapeseed would benefit producers by reducing marketing risks and possibly raising prices by strengthening producers' bargaining powers with the domestic crushers and upgrading marketing skills. At the same time, the commission warned that the only practical possibility for large volume pooling is a prairiewide pool. They gave as reasons the difficulty in showing results comparable to the open market and the necessity to subsidize pools to meet competitive levels. The committee felt that elevator companies which could operate pools would not do so, because they feared getting into price wars with competing pools. That would force them to cross-subsidize and enforce delivery under contract.
Besides this single agency voluntary pool, the commission evaluated a compulsory pooling through the Wheat Board and found it would not suffer from the problems of enforcement. Mr. Speaker, two years later the pressure for such a compulsory pool resulted in the pool producer marketing referendum. As if the deck was not stacked well enough in the beginning of that referendum, and as the hon. member for Yorkton-Mel-ville (Mr. Nystrom) said, at the height of that campaign on the referendum for rapeseed marketing the Minister in charge of the Wheat Board announced that, if producers would not vote for a compulsory pool, he would bring in enabling legislation for voluntary pools. If that is not influence peddling of the first order, I have never seen any. If that is not a direct intervention by a spokesman for the government, in what was supposed to be an open and democratic vote, I have never seen one. If that was not an attempt to influence the vote, I have never seen one.
The evidence and the history is irrefutable. The size of rapeseed production in Canada related to the total world production of oilseeds is so small that unless you have one single pooling you cannot amount to very much in the world market for oilseeds. It makes more sense to have rapeseed under the Canadian Wheat Board with a pooling arrangement being compulsory, the same as it is for wheat, oats and barley. In that kind of a situation it would make more sense, considering our position in competition with other oilseeds. It would make more sense to have rapeseed under a single pool under the Canadian Wheat Board than it would to have wheat, oats and barley.
The logic and the reasoning of the minister and the hon. member for Qu'Appelle-Moose Mountain (Mr. Hamilton) escapes me completely. I can understand the whole philosophy
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behind this bill, but my philosophy is the opposite of theirs. The philosophy behind this bill is to do nothing more than shore up the so-called free enterprise open market system. If that free enterprise open market system is so good, I do not understand why the official opposition would even ask for a 90 per cent guarantee of initial payments against the pool-proceeds. They have been telling us for years that the open and free market system is the best and cannot be beaten. They have been telling us it will work best for the farmer and it will save him. Then they turn around with the other hand out, like a typical free enterpriser-the greatest welfare bums in the country-wanting a 90 per cent guarantee from the government on that free enterprise open market voluntary pool. If that is not trying to have it both ways, I have never seen it.
If the minister attempts to legislate compulsion into a voluntary pool, then he is in for a lot of trouble and so are his friends in the official opposition who support him in this legislation. If the minister thinks he can use the Canadian Wheat Board, which does not believe it can operate a voluntary rapeseed pool under this legislation, I will bet you a dollar to a hole in a doughnut that they will not operate a voluntary rapeseed pool unless the minister interferes with the operations of the board and makes them do it.
For the minister in this legislation to use the Canadian Wheat Board, its accounting and its permit books as a weapon over farmers who volunteer into the pool and as a method of making it compulsory for them to stay in the pool, surely smacks of some kind of hypocrisy, even from a free enterpriser.
I do not believe a voluntary pool can work with the provisions in this bill. The history of voluntary pools has been so sad and so painful both to grain producers and to governments over the last 50 years that one would have thought the hon. minister and the hon. member for Qu'Appelle-Moose Mountain would have learned a lesson from history for a change. Yet they still blindly, insensitively and ignorantly try to continue down a path which has been proven to be bad and proven to be the wrong road to take. Surely the Official Opposition will join us in saying, "Look, leave our rapeseed producers alone in the free and open market, which the majority of them voted for, or put the whole thing under the jurisdiction of the Canadian Wheat Board and quit trying to horse around with half measures". They should quit trying to have it both ways. It will not work. It can only harm the whole principle of orderly marketing. This is nothing more than another attempt to bring orderly marketing into disrepute, to weaken the Canadian Wheat Board and to lessen its strength in the marketplace of the world on behalf of our Canadian grain producers.
I am appalled that hon. members in the Official Opposition can get to their feet and blithely and blandly agree to this legislation, saying they will support it and commending the minister for it. I did not think they would ever commend the minister for anything, but when it comes to something like so-called free enterprise and an open and free market, by golly, and those chickens of a feather flock together. They are holding hands with each other. I am sure the boys in the open

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market in Winnipeg are very pleased with them. No doubt the commodity fellows in Vancouver, Chicago and in a few other places will be very happy with them.


Lorne Edmund Nystrom: "Alvin and Otto".


Leslie Gordon Benjamin: They are the great twins in what 1 consider a betrayal of the whole principle of orderly marketing and the strengthening of Canadian grain producers in the face of the competition we get from the rest of the world. This is a sham. It will not work. The rapeseed growers' own elevator companies and their organizations say they are not interested in voluntary pools. They have been twice bitten and they are four times shy. I hope those farmer-owned grain companies will stick to their guns. I hope this legislation will prove be completely ineffectual. I hope it will be shown up for what it is-nothing more than window dressing in terms of what it will do for rapeseed producers.
This legislation is a shoring up or a strengthening of the so-called open and free market system. If the Progressive Conservative Party is sincere in its advocacy of private enterprise, it will denounce this interference with rapeseed producers who want to pool their grain voluntarily but who are compelled to stay in the pool. I would have thought that the hon. member for Qu'Appelle-Moose Mountain would have been thundering away like a 40-mile an hour chinook; but no, he was like soft winds over still waters, supinely and docilely agreeing with the Minister in charge of the Canadian Wheat Board. I never thought I would live to see the day. It was bad enough and sad enough when the hon. member for Dauphin (Mr. Ritchie) did the same thing. He is quite a nice fellow. But I never thought I would live to see the day when the hon. member for Qu'Appelle-Moose Mountain would lie down so quietly and so obediently in the face of the history of both voluntary and contractual pools during the 1920's and again in 1959 and accept the minister's proposals. I always thought the Conservatives abhorred and hated the word "compulsory" or "compel".
However, the hon. member agrees that the minister should compel, through the use of an orderly marketing system and through the use of Canadian Wheat Board permit books, rapeseed producers to stay inside the pool even if the bottom drops out of the rapeseed market. They cannot volunteer out of something they volunteered into. That is inconsistent. They can volunteer in, but they cannot volunteer out. The free and open market is best, but there have to be 90 per cent government guarantees! That is inconsistent too. It does not surprise me, coming from the minister, but I would have thought that the official opposition would at least have made some passing attempt to be consistent with what is supposed to be its philosophy.
I have spoken to officials of the three wheat pools. I have spoken to rapeseed producers and grain producers generally over the past months. None of them voiced any confidence whatsoever in a volunteer pool. None of my mail has been in favour of volunteer pools. Farmers who have been in the grain growing business for decades have learned their lesson from

history and profited from bitter experience. The prairie wheat pools profited from the bitter experience of 1959. Where is the Progressive Conservative Party, or the Liberal Party for that matter, when it comes to learning some lessons from history? It has to be one or the other; it is either the free and open market period, or it is orderly marketing under the Canadian Wheat Board.


Lorne Edmund Nystrom: You can't be half pregnant.


Leslie Gordon Benjamin: To try to use the Canadian Wheat Board orderly marketing system and wheat board permit books to shore up the free enterprise system and to make the open market work better at the expense of grain producers is some kind of political and economic chicanery. These great believers in the free and open market do not have the courage to see if that free and open market will stand the test. They know that it has not stood the test since the late 1800's. Grain producers have lost out. Elevator companies owned by grain producers have lost out time after time, whether it was under volunteer pools, contractual pools or whatever. They know from bitter experience.
I hope the official opposition will re-think its position on this particular item. I hope for a change hon. members to my right will talk out of just one side of their mouths and say that since the majority of rapeseed producers do not want the free and open market for the marketing of rapeseed, the Conservative Party does not want it either. Since hon. members to my right are always complaining about people running around with their hands out trying to get government help, they should be the last ones to want to have a 90 per cent government guarantee of initial payments against pool proceeds which are operating on the free and open market.
It must be an insult to a genuine free and open marketer to have to ask the government to give a guarantee. If the free and open market is so good, it should be able to stand on its own feet. According to the free and open marketers, it will be of great benefit to the rapeseed producer. After all, when rape-seed prices can fluctuate from $1.50 to $2 in five or six weeks, all the rapeseed producer can say is that he has been fluctuated again.
It will be interesting to see how the minister continues to try to justify this legislation. There is not one bit of legitimate justification. Prior to voting on the rapeseed plebescite, the minister gave the commitment that, if the producers did not vote for a compulsory pool, he would bring in enabling legislation for a voluntary pool; so at least in that sense the man is being honest. However, I am surprised that the official opposition is supporting him.


Mr. Deputy Speaker:: Order, please. I regret to interrupt the hon. member, but his time has expired. Unless he gets unanimous consent to continue, I will have to recognize another hon. member.


Some hon. Members:: Carry on.
June 13, 1977


Mr. Deputy Speaker:: Is the hon. member requesting unanimous consent?


Leslie Gordon Benjamin: Yes, Mr. Speaker, since everybody is dying to hear more.


Some hon. Members:: Agreed.


Leslie Gordon Benjamin: Since there has been an overwhelming request that I continue, I shall, and I thank my hon. colleagues for their kindness.
I want to discuss some information which has been provided to me. It is interesting to note that there is a fight brewing over the definitions in the bill. There is a debate as to whether the bill allows the Wheat Board to operate a voluntary rapeseed pool. I understand that the Wheat Board does not think voluntary pooling will work, and it says that this bill will not allow it to offer one anyway. The minister's advisers say they framed the bill specifically to allow the Wheat Board to form a voluntary pool. I am looking for an explanation from the minister.
I would also like to get an explanation with regard to the establishing of marketing plans. Clause 35.11(1) of the bill reads as follows:
Any association representing a significant number of producers engaged in the production of grain or any association or firm engaged in the processing or marketing of grain in interprovincial or export trade may submit to the Minister for his review and recommendation to the Governor in Council a written proposal for the establishment of a marketing plan.
That will be the voluntary pool. I would like to know why there is nothing in the bill which defines an association. What is an association? What is "a significant number"? I do not see how, without any explanation from the minister, anybody can accept this bill. I do not see how it can work. It is just left purely and simply to the whims of the minister. He can pick and choose any association rapeseed producers want. He can say: "This one is significant, so therefore I will allow it; this one is not, therefore I will not allow it". I know that is something the official opposition wants to see. If that is the Wheat Board's unofficial and off-the-record reaction, it is typical of comments made by people in the grain trade on the whole matter of voluntary pools.
The line elevator companies were unanimous that they will heartily resist the setting up of voluntary pools and their hope is that everyone else will, too. That is not the Alberta, Manitoba or Saskatchewan wheat pools. It is M. M. Patterson and Sons, the Pioneer Grain Company, the Cargill Grain Company, and any other private elevator companies. They are resisting it heartily. Government officials took some delight in giving credit to Cargill Grain Company for encouraging the Minister of Transport to set up voluntary pools. That is not the way I heard it. The way I heard it, the company's executive vice president, Mr. Dick Dawson, said:
I think we'd be the last to set one up. I frankly doubt we'll see them even in rapeseed.
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The possible benefits for pooling rapeseed should be examined. Since the pools would bear at least part of the marketing risks normally handled by the futures market, the amount of hedging on this underspeculated market would drop. This could improve the market's performance and end chronic inversions. The formation of producer groups might bring pressure on the Wheat Board to give higher priority to rape-seed in the allocation of quota and grain cars and so improve the handling of rapeseed. However, the board now attempts to match deliveries to sales and further concessions to rapeseed producers could lead to a backlash from other community groups. You could have wheat growers, barley raisers and flax and rye producers on your neck really fast if you started giving preferential treatment to rapeseed producers for any period of time.
The formation of pools by associations of producers who are not currently marketing rapeseed could lead to a growth in the quantity and quality of marketing information and expertise in the trade. The effect of voluntary pools on market development would depend on their size. Small pools would do little or nothing to develop new markets; the best development work could be done by a single large pool which could afford the associated costs.
The difficulty of predicting annual patronage would work against long term marketing plans by one or more small voluntary pools. Surely it is obvious and patently plain that the only sensible policy which would bring maximum benefits to producers of rapeseed is to put that grain under the jurisdiction of the Canadian Wheat Board, which can operate pools for rapeseed just as it does for wheat, oats and barley. That is not socialist dogma; it is not ideology put out by the NDP. That is an idea that has been fought for by grain producers since the 1880s. It has been worked for, fought for and paid for by grain producers in the three prairie provinces ever since then.
The principle of orderly marketing has been supported by people of all political stripes. This legislation is nothing more than an attempt to leave loopholes so that the so-called free and open market can be strengthened. Any time this parliament or this government or any other government wants me to vote in favour of providing a 90 per cent guarantee for the so-called open and free market, I want nothing to do with it. I urge the House to defeat this legislation and to call on the Minister in charge of the Canadian Wheat Board and on the government to bring rapeseed under the jurisdiction of the Canadian Wheat Board, to provide a pooling system for rapeseed as they do for other grains so that grain producers in western Canada would be better off and would be forever grateful.


Mr. Deputy Speaker:: Is the House ready for the question?


Some hon. Members:: Question.


Otto Emil Lang: Mr. Speaker, I rise on a point of order. I believe there is consent in the House that the bill be considered in Committee of the Whole instead of referred to the Standing
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Committee on Agriculture and that the motion be read accordingly.


Francis Alvin George Hamilton: I support that, Mr. Speaker.


Stanley Howard Knowles: Yes, Mr. Speaker, we have already given our agreement for the bill to be considered in Committee of the Whole. That does not mean we are for second reading of the bill; we are not.


Mr. Deputy Speaker:: Is it agreed that the motion be modified so that the bill be referred to Committee of the Whole instead of the Standing Committee on Agriculture?


Some hon. Members:: Agreed.


Mr. Deputy Speaker:: Is there agreement to the motion?


Stanley Howard Knowles: On division.


[Stage Direction]
Motion agreed to, bill read the second time and the House went into committee thereon, Mr. Laniel in the Chair.
On Clause I.
Francis Alvin George Hamilton: Mr. Chairman, clause 1 could probably be dealt with in more detail, but to expedite matters, may I put a question to the minister. I am a little concerned about the precise details of the relationship between the Canadian Wheat Board and the various voluntary pools. Could the minister explain that hypothetical relationship so we could have a picture of what he envisages in setting up these pools?


Otto Emil Lang: The only relationship between a pool and the Wheat Board is the relationship between the pool and the Wheat Board Act. The permit book may be endorsed with the notation that the producer is a member of a pool and therefore may deliver his grain only to that pool That is because he will have contracted with the pool along those lines. There is no other necessary connection between the pool administrators as such and the Wheat Board. It would be the government that would have to take responsibility for approving the financial stability and the adequacy of the plan which the particular proponent of the pool is putting forward, and also to ensure and guarantee the initial price. The Wheat Board need have no connection with any of that proceeding.


Francis Alvin George Hamilton: That means that if, for instance, the Saskatchewan Wheat Pool offers to its members a plan and gets approval from the minister, he will guarantee 90 per cent of the initial payment, and the Saskatchewan Wheat Pool is responsible for the selling of that grain on any market without any influence by the Wheat Board.


Otto Emil Lang: That is correct, Mr. Chairman.


Francis Alvin George Hamilton: One final question, Mr. Chairman. Suppose five voluntary pools were set

up in western Canada. Does the minister visualize that they would be competing for markets as opposed to a single pool with no compulsion to compete?


Otto Emil Lang: Yes, Mr. Chairman, that would be very much the case. I think they would be competing very vigorously because the final payment at the end of the year would be quite a revelation in terms of their over-all performance during the year. Obviously the department would have to distinguish between good luck and good judgment in the selling process but there would be vigorous competition between the pools if there were several.


Lorne Edmund Nystrom: I understand there is a debate going on about whether the Wheat Board itself could participate in or establish a voluntary pool. If my information is correct, some advisers of the Wheat Board believe they cannot. I should like to know whether the minister thinks they can.


Otto Emil Lang: Mr. Chairman, I believe the question whether they can would depend upon the interpretation of the Canadian Wheat Board Act. I have not asked that question of my legal advisers because I had not thought it very likely that the Wheat Board would be apt to do so in any case. I see some difficulties in their doing so in terms of financial backing and the relationship between such a pool and their other operations. I do not know of any intention on their part to enter into such activity, so I have considered that question rather theoretically, as one not needing an answer. Therefore I have not asked for an answer.


Lorne Edmund Nystrom: I wonder if the minister would look into that, because things may change a few years ahead. Does the minister at this time envisage any other grain producers setting up voluntary pools? I understand the act allows for producers of oilseed commodities other than rapeseed to establish pools as well.


Otto Emil Lang: Not at this time, Mr. Chairman. I know of no significantly expressed interest at this point. I think if the pooling development worked well in relation to rapeseed demands, other grains could follow. Where there is a sufficient volume of grain I would see no difficulty responding to that demand.


Lorne Edmund Nystrom: Could the minister tell us at this time who he expects to participate in the pools? I think the hon. member for Regina-Lake Centre said the wheat pools at this stage are not interested in doing so, and I have heard some others say the same thing about the private companies as well. I wonder if the minister has received any indication in his office of what groups or associations might be considering pools.


Otto Emil Lang: I have had some conversations which lead me to believe there will be an interest in a pool. These were discussions of a preliminary nature so we will have to see how they are followed up once the legislation is in place. I hope the pools will look at the possibility themselves because a good number of pool members would appreciate the opportunity of pooling in relation to rapeseed and the pools might not want to lose
June 13, 1977

those members to competitors if an alternative pool were set up.


Lorne Edmund Nystrom: I wonder if the minister could answer precisely, Mr. Chairman; that was only a guess. Has he done any serious thinking about the cost of operating the pools because of the government guarantee? I know the minister cannot answer precisely because we do not know how they will be operating at this stage, but is there any ball park figure?


Otto Emil Lang: No, Mr. Chairman, but the experience with the guarantee to the Canadian Wheat Board is an indication of the modest cost that is likely to be involved. Under the pattern of the act, initial prices are really meant to be set at a level which is likely to be safe in any case. The call upon the guarantee is only likely to occur in very drastically changing circumstances. In the case of wheat, barley and oats this has seldom occurred. One occasion when it did occur was when the government knew fairly well that it was inviting the risk of that occurring and therefore in a sense using the initial price slightly differently from its original intention. I would not see that happening very often in this case.


Lorne Edmund Nystrom: Mr. Chairman, may I ask a final question, then cede the floor to other questioners. A number of rapeseed producers have told me about their concerns with regard to bootlegging. Is the legislation drafted so as to penalize bootleggers or to discourage bootlegging? How strictly will the regulations be enforced? Further, will the minister make sure that those regulations are enforced?


Otto Emil Lang: Mr. Chairman, we certainly want to see them enforced. The person participating in the pool would be under a contractual obligation, legally binding. We are adding a penal provision to strengthen that obligation. There will be law to enforce it, since if someone is under a contractual obligation to a pool and withdraws, it is most unfair to the others. In practical and moral terms it is like a theft. It is not exactly like a theft under the Criminal Code, but it deserves the added enforcement and penalty provisions in the bill.


William Gordon Ritchie: Mr. Chairman, may I ask the minister how the initial payment will be set? Will it be done after consultations, assuming there is more than one pool? What will be the minister's influence on the process? Will a formula be worked out? Further, will the initial price be the same for all pools?


Otto Emil Lang: Mr. Chairman, I expect the pools will tend to adopt the highest available initial price, because they will want farmers to supply them with rapeseed. The initial price in the end will be determined by the federal government's guarantee. This process is followed in relation to the initial price paid by
the Canadian Wheat Board as well. No doubt pool administrators will request or suggest an initial price We, as the government responsible for the guarantee, will need to determine if that price is safe to pay, in accordance with traditional factors governing initial price.


William Gordon Ritchie: Mr. Chairman, I suggest that the pools will be substantially different in their workings from the Canadian
Canadian Wheat Board Act
Wheat Board. I am thinking of the way the initial price will be set. Possibly different prices could be set for different pools. Would the government guarantee all of those initial prices? If one pool were asking a higher initial price than another, would the government guarantee that higher initial price?


Otto Emil Lang: No, Mr. Chairman. The government would be prepared to guarantee such initial price as is available for all other pools legitimately established. If the hon. member is asking, is it possible in theory for a pool to set a lower price than that which the government guarantees, the answer in theory is yes; but in practice I do not think it will arise.


William Gordon Ritchie: Mr. Chairman, say the government sets a price of $5, but some pools feel they can charge an initial price of $5.50. Will they be on their own so far as the extra 50 cents is concerned? If the pool lost 50 cents, say, as a result of this, would that organization be responsible for the loss?


Otto Emil Lang: Mr. Chairman, yes, they would. They would be on their own for the extra amount.


William Gordon Ritchie: Mr. Chairman, may I ask one last question on the definition of "producer"? Will producers be those who traditionally hold Wheat Board permits? It is my impression that the definition of a producer in this bill is somewhat different from the definition of a producer who deals with the Wheat Board. Perhaps the minister could elaborate.


Otto Emil Lang: The definition is almost the same, Mr. Chairman. I forget exactly in which way the definitions differ. I will look through the relevant parts of the bill to see if I can discover the small technical difference which may exist; however, by and large, the definitions are similar.


Douglas Charles Neil: Mr. Chairman, with regard to a producer who belongs to the pool, the bill provides that he can cease to participate in accordance with the plan. Does the minister visualize that each plan will have a different contract with the producers, or is it his intention that the provisions for opting out will be the same for all plans?


Otto Emil Lang: Mr. Chairman, I see some scope for flexibility here. I would not want to project what may turn out to be an acceptable proposal. The various proponents of a plan may come up with a variety of differences. Looking at the definition of actual producers, the key difference is that provision has been made for participation in such a plan of the landlord or non-actual producer who may be the owner of the rapeseed. That is the main difference here.


Ralph Goodale: Mr. Chairman, I am interested in the federal government's financial commitment to the kinds of schemes that may be authorized by the bill before us this evening. Can the minister say if the guarantee of a certain level of initial payment is in fact the only monetary or financial obligation which the federal treasury will be assuming through this legislation, or is there in the bill some broader obligation upon
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the government to compensate certain pools if they run into adverse conditions and suffer losses above and beyond the level of initial payment which may be guaranteed or beyond any obligation with respect to administration costs?


Otto Emil Lang: Mr. Chairman, the guarantee of initial payment is the only federal obligation or cost contemplated, apart from the rather regular governmental-type costs which may be involved in the administration of inspection services and, therefore, administration of the law as such.
[ Translation]


Joseph Adrien Henri Lambert: Mr. Chairman, can the minister tell the House what advantages could encourage the producers to participate or not participate in that type of marketing? Can he also tell us what the freedom of association, or not, rests on? And finally, can grain marketing entail certain advantages for those who are part of it, or those who are not? [English]


Otto Emil Lang: Mr. Chairman, the price of rapeseed may go up or down rapidly or quite significantly over any period of time. There are many farmers who are producers of rapeseed who simply want to be in the farming business. They do not want to become experts in judging when the market is going to be good or when it is going to be bad. They would prefer to have the average price for the year for their product rather than risk taking a low price or gambling on a high one or hoping they will be getting a high one. It is meant to allow them to get an average price without their trying to guess the market during that particular year.


Joseph Adrien Henri Lambert: Mr. Chairman, will that way of doing things not be a source of difficulties for the new act, which could prevent it from being really efficient, and from giving really efficient marketing services to those who truly want a marketing organization, because in other fields, for instance, in the egg marketing business, which Parliament knows very well, the situation is not quite the same: everything must be marketed globally to get results. Are things different in the field of cereals, of rapeseed; and are the producers willing to see the bill passed as proposed, or is it being imposed upon them?


Otto Emil Lang: The key answer is that the creation of a pool simply gives the farmer an additional option. He may choose to market the way he now markets and decide his own time for selling and try to guess the best price or he may join the pool. But, of course, if he joins he brings in all his rapeseed to that pool. The choice is that of the farmer.


Leslie Gordon Benjamin: Suppose a farmer has 80 acres of rapeseed in one place and 80 acres a few miles away. I take it he cannot volunteer one lot of 80 acres to be delivered to the pool and the other to be kept for placing on the open market at his convenience. All of it has to be sent to the pool or nothing?


Otto Emil Lang: That is so.


Leslie Gordon Benjamin: Can the minister tell us who would do the enforcing in order to prevent bootlegging or attempts to evade a contract? Would it be the association with which the contract is made or the Wheat Board? Because the person concerned has put himself under an obligation according to his permit book. Or would it be done by the minister from his office?


Otto Emil Lang: The act merely provides for the designation of persons as inspectors. We would certainly not see this as meaning the participants or agents of the pool as such in an ordinary case. If the Wheat Board inspectors or the Grain Commission inspectors, or other inspectors who would be available in any case, could add this to their duties, that solution might be considered, or special inspectors would be designated. I would look forward to using inspectors who are presently engaged in grain-related duties in the region.


Leslie Gordon Benjamin: In other words, the inspectors would be the employees of an agency of the government and they would be carrying out inspections having to do with contractual arrangements with a voluntary pool which had nothing to do with the Wheat Board. That is, they would be federal employees carrying out duties on behalf of an association.


Otto Emil Lang: That is the way I would see it. I see it, really, as being a regular part of law enforcement.


Leslie Gordon Benjamin: If violations were discovered would the inspector from the Wheat Board or the Grain Commission lay criminal charges, or would that be up to the association?


Otto Emil Lang: The charge might not technically be a criminal charge but it would be laid with the advice of the attorney general, as are charges laid under various other statutes.


Leslie Gordon Benjamin: What does the minister envisage by "an association representing a significant number of producers engaged in the production of grain" and so forth-the words appearing on page three? Can he tell us what he would consider would constitute such a number? I presume this means rapeseed producers. What percentage of producers would need to be involved? Would they come from the whole province or from part of a province? It seems to me this is a clause which is far too vague.


Otto Emil Lang: Mr. Chairman, it suffers from some vagueness, without any doubt. It may be difficult to have a judgment in advance as to what would in the end be the answer to the hypothetical question whether a certain number of producers was sufficient. It is designed to give some flexibility to the clause, which would have otherwise restricted the move toward these pools to firms actually engaged in the marketing of grain. It seemed desirable to have an open door for some others. The financial security, the guarantee of the initial price and so on gives us the additional flexibility to make some judgment here. That clause can work notwithstanding, as the hon. member says, that it is vague in its technical sense.
June 13, 1977


Leslie Gordon Benjamin: Mr. Chairman, I would take it from the minister's reply that he would envisage recognizing only bona fide grain companies or people who are in the grain handling business, whatever the nature of the company is, whether it is a private company, a wheat pool, an agency in the Winnipeg Commodity Exchange or a broker in Vancouver who can get contracts from 20,000 rapeseed producers. In the minister's view, it would be someone who is already in the grain business.
I do not mean this in a derogatory sense, but suppose the Palliser wheat growers wanted to sign up 10,000 or 20,000 rapeseed producers, would that be considered an appropriate association? Would the minister prefer to stick to one that is already in the grain or rapeseed handling business?


Otto Emil Lang: Mr. Chairman, I would see that association as eligible, as I would the Rapeseed Growers Association and the National Farmers' Union. Just as long as we do not try to press that analogy too far, I do not mind giving that offhand account.


[Stage Direction]
Clause agreed to.
On clause 2:
Francis Alvin George Hamilton: Mr. Chairman, it is on this clause that I would like to ask the minister if he can explain to the committee how he envisages the financial responsibility of a marketing plan under the bill before he will accept it. He must have in his mind some criteria as to how these voluntary pools can satisfy the minister. They have the capacity to administer successfully up to a point. If there is inability to sell the grain they have contracted for, will they have the Finances to meet storage costs and interest costs?


Otto Emil Lang: Mr. Chairman, under this clause the proposers of a plan will have to satisfy the governor in council of their Financial ability to carry the plan forward with the necessary bonds, insurance or other security to cover their potential indebtedness within the plans they are establishing. I can see that meaning a certain assurance of viability would allow the undertaking of a certain number of contracts for a certain volume of rapeseed. If the proposers of a plan wanted to go beyond that, they would have to extend or add to their financial viability. We will want the assuredness that the financial viability is there, quite apart from the guarantee we may give at the initial price.


Francis Alvin George Hamilton: Mr. Chairman, I realize the minister has great difficulty in saying that he is sure, because we do not know what will be the case. To follow that up, can the minister visualize a situation where one of these pools, fearful of the financial responsibilities above the initial payment, will restrict the number of contracts they are willing to accept?


Otto Emil Lang: Mr. Chairman, I can see that as being possible if the pool in question was a small organization. Some of the organizations we have contemplated, such as the large wheat pools on the prairies, would not likely have that problem. I could see eligible administrators having that difficulty.
Canadian Wheat Board Act


Lorne Edmund Nystrom: Mr. Chairman, I have just one short question. From reading the bill, I take it there is no definite time frame as to how long the pool should last, whether it is a year, two years or five years?


Otto Emil Lang: That is correct. There is flexibility there for the proposers. I think ordinarily we are thinking in terms of one year periods, and I doubt that anyone would propose a longer period; but there may be some advantage seen in shorter periods so that any rapid market fluctuations may be moved out of the pool.


[Stage Direction]
Clause agreed to.
On Clause 3.
Lorne Edmund Nystrom: Mr. Chairman, it appears to me that the number of people participating in a pool is left wide open. Is there any minimum size or maximum size, or is it just a wide open affair?


Otto Emil Lang: That is not spelled out. In that sense it is wide open. A certain number would have to be sought for administrative viability, so the proposers no doubt will have that in mind. The maximum number would result from the Financial security which has to be posted.


Douglas Charles Neil: Mr. Chairman, page 3 of the bill deals with the establishment of marketing plans. Reference is made to an association representing a signiFicant number of producers. Then later on it refers to making an order if there are a sufFicient number of producers. I am wondering what is the difference between "a significant number" and "a sufFicient number" and why the same words are not used. There must be some distinction.


Otto Emil Lang: Mr. Chairman, would the hon. member please draw my attention to the word "sufficient"?


Douglas Charles Neil: On page 3, clause 35.11(1) says: "Any association representing a signiFicant number of producers engaged in the production of grain ..." Clause 35.12 makes reference to a sufFicient number. Then on page 4 the bill refers to a signiFicant number again.


Otto Emil Lang: A significant number would be a judgment on the part of the association as to whether it has that kind of support, when it is an association and not a company which is proposing a plan. A sufficient number again would be a judgment. It may not be different from a signiFicant number, but I think it would be many fewer. It may be those who are actually participating, willing to participate, and therefore sufFicient to make a plan worthwhile. It is that non-minimum which is, however, meant to be judged by the governor in council as being enough.


Leslie Gordon Benjamin: Mr. Chairman, further to the minister's reply to the hon. member for Moose Jaw, I take it that in the first instance there must be what appears to be a significant number and an appropriate association, in the view of the

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Canadian Wheat Board Act
minister, to go into a voluntary plan, on the one hand; and then in the course of a sign-up it would be a matter of judgment for the minister as to whether, even though the association represents a significant number, there is a sufficient number to make the plan work, and that this lies in the hands of the minister.


Otto Emil Lang: That is correct.


Joseph Adrien Henri Lambert: I am still referring to clause 35.12 and to the explanation just given by the minister concerning a sufficient number of producers. Will the regulations determine in greater detail the meaning of producers? What will influence the minister's decision: the volume of grain or the number of producers?


Otto Emil Lang: We are really looking here at the number of producers. I do not see a practical problem because the administrators of a plan would not want to go forward with it unless they had a fairly large volume of grain and producers. Therefore, we would not have much difficulty with making a judgment.


[Stage Direction]
Clause agreed to.
Clauses 4 to 11 inclusive agreed to.
Title agreed to.
Bill reported.
Mr. Deputy Speaker:: When shall the bill be read the third time? By leave, now?


Some hon. Members:: Agreed.


Leslie Gordon Benjamin: No, Mr. Speaker, I do not give consent to giving the bill third reading now.


Mr. Deputy Speaker:: There is nothing in the order which says it cannot be given third reading now, except the time. The Chair cannot read the minds of hon. members; they must indicate whether or not they wish to carry on. The bill has been reported. Does the hon. member wish me to put the question and give him the floor for third reading?


Leslie Gordon Benjamin: I would like to call it 10.30 p.m., Mr. Speaker.


BUSINESS OF THE HOUSE
Mr. Paproski:: Mr. Speaker, I rise on a point of order. I would like to know what business we have on hand for tomorrow, if the House leader would be so kind as to tell us what he has on the platter.


Allan Joseph MacEachen: Mr. Speaker, we will continue with the bill presently under consideration. Then we will consider Bill C-4. Following that we will have consultations tomorrow morning.


Stanley Howard Knowles: Mr. Speaker, what about Bill C-30?


Mr. Deputy Speaker:: It being 10.30 p.m., this House stands adjourned until Tuesday at 11 o'clock a.m., pursuant to order passed on Monday, May 30, 1977.
At 10.35 p.m. the House adjourned, without question put, pursuant to special order.


Tuesday, June 14, 1977