1977-04-05

ROUTINE PROCEEDINGS


Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I rise on a matter of urgent and pressing necessity pursuant to the provisions of Standing Order 43. In view of legal arguments advanced in an Ottawa court by Mr. David Scott, Counsellor for Senator Marchand, invoking the concept of executive privilege, with reference to testimony by the senator, and in view of the undoubted desire of the government of Canada to assist in every way the judicial process in order to get at the truth, I move, seconded by the hon. member for Peace River (Mr. Baldwin):
That the Minister of Justice take immediate steps to clarify the concept of executive privilege as it pertains to privy councillors and other government officials vis-a-vis their testimony.


Mr. Speaker:: Presentation under Standing Order 43 for debate of such a motion can only be made with unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


AGRICULTURE
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I rise under the provisions of Standing Order 43 to present a motion of urgent and pressing necessity. In the House yesterday the Minister of Agriculture said he had submitted a proposal to the federal cabinet calling for a national school milk program. I move, therefore, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House urge the government to implement the proposal, namely, a national school milk program in time for the 1977-78 school year.


Mr. Speaker:: 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.


FINANCE
Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43. With share prices on Canadian stock exchanges having fallen following last Thursday's budget and as the dollar has also declined while interest rates have risen, all reflecting a general lack of confidence in the budgetary measures on the part of business, while labour is also disgruntled, and as it has been some time since we have had a budget which proposes an economic approach that will lead to full employment with little inflation, I move, seconded by the hon. member for Vancouver Quadra (Mr. Clarke):
That this House instruct the Minister of Finance to prepare and bring in such a budget without delay.


Mr. Speaker:: Once again I reiterate that since the argument on the budget is the subject matter of debate for today, it is difficult to ask the House to set aside that order in order to debate the budget.


EXTERNAL AFFAIRS
Mr. Gilbert Rondeau (Shefford):: 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.
Considering that Cuban troops, supported by Russian and Chinese troops are now in Mozambique, as they recently were in Angola, and that those troops intend to create troubles in Rhodesia and South Africa, overthrowing the governments of those two countries to develop and control better their great mining resources thus giving to the U.S.S.R. the exclusive control over the Cape in South Africa which is the sole passage

April 5, 1977
Energy
to the Indian Ocean and would enable them to exercise exclusive control over imports and exports, I move, seconded by the hon. member for Villeneuve (Mr. Caouette):
That a committee of the House reassess the foreign assistance of Canada to Mozambique since we have recently undertaken to provide $60 million to Mozambique while that country has fallen under the control of international communist troops.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


INCOME TAX
Mr. Stuart Leggatt (New Westminster):: Mr. Speaker, I, too, rise on a matter of urgent and pressing necessity pursuant to Standing Order 43.
Having regard to the announcement last Friday that Canada's largest forest product firm has disbursed some $3 million abroad in what are called questionable payments, $1,773,000 of which was probably used to subvert local tax or foreign exchange laws, and in view of the fact that these items are tax deductible under Canadian tax law, I would move, seconded by the hon. member for Nickel Belt (Mr. Rodriguez):
That this House direct the Minister of National Revenue to amend our own tax laws to discourage this iniquitous practice and, further, that this subject be referred to the Standing Committee on Finance, Trade and Economic Affairs for investigation since the committee is conducting on going studies into similar practices by Crown corporations.


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


Some hon. Members:: No!


PROPOSAL THAT INCREASE IN PRICE OF OIL BE ACCOMPANIED BY DECREASE IN TAX-MOTION UNDER SO. 43
Mr.   Jean-R. Roy@Timmins: Mr. Speaker, under the provisions of rule 43 of the Standing Orders, because of the injustice that the rumoured increase in the price of oil would perpetrate on citizens of small or fixed income in connection with home heating and transportation, I would move, seconded by the hon. member for Vaudreuil (Mr. Herbert):

That this House seek an assurance from the government that any such negotiated price increase will be accompanied by a corresponding decrease in government taxes on gasoline and heating oil.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Presentation of such a motion pursuant to Standing Order 43 can be done only with the unanimous consent of the House. Is it agreed?


Some hon. Members:: No!



ORAL QUESTION PERIOD

['Mr. Speaker, I have not had an opportunity of seeing the document. I will look into it so that I will know more about it.\n4646\nPetro-Canada']
Mr. Speaker:: The hon. member for Perth-Wilmot.


Mr. Bill Jarvis (Perth-Wilmot):: Mr. Speaker, despite my having given notice to the Minister of the Environment that questions would be directed to him today, the minister has not yet condescended to join us. Perhaps you will recognize me later.



Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, my question is addressed to the Minister of Energy, Mines and Ressources. It relates to a report of the International Joint Commission in which the commission states: "Radioactivity in the Great Lakes is a major threat to public health". This assertion certainly seems to refute some of the statements given out by Atomic Energy of Canada Limited. In view of the obvious buck-passing by AECL, Eldorado Nuclear and the AECB on this issue, would the hon. gentleman tell the house when he expects to present regulations on refined radioactivity objectives?
Hon. Alastair Gillespie (Minister of Energy, Mines and
Resources): It seems to me the hon. member is drawing a long bow if he is trying to associate a hearing of the International Joint Commission with respect to water quality on the Great Lakes with a new set of regulations with respect to refining uranium in Port Hope. I shall be pleased to discuss the first part of the question with my colleague, the Minister of the Environment and Fisheries. As to the second part, perhaps he would be more precise.


Allan Frederick Lawrence: I must say I am appalled that the minister in charge of the regulatory bodies in the field of radioactivity does not realize that the International Joint Commission has made a startling recommendation to him and to the government in connection with this matter. I repeat; the commission
April 5, 1977

considers radioactivity a major threat to public health. If I may read that part of the report; it is very short. "The commission considers radioactivity a major potential concern to public health-


Some hon. Members:: Order!


Allan Frederick Lawrence: "The governments are urged to complete their consideration of refined radioactivity-"


Mr. Speaker:: Order, please. 1 do not think it is fair by way of a preamble to permit the reading of the whole recommendation.


Allan Frederick Lawrence: That is it, Sir. That is the preamble. Like a lot of other things the minister has obviously not even heard of it before. Since the minister is in charge of AECB-and the government for that matter-when is it intended to do something about the radioactive deposits in the Great Lakes and in the St. Lawrence Seaway?


Mr. Gillespie:: Mr. Speaker, I would be very pleased to take up this matter with the Atomic Energy Control Board, but 1 point out to the hon, member that it is far from clear to me that the AECB has any responsibility for radioactive levels in the Great Lakes. There is no licensing authority with respect to the Great Lakes themselves. It seems to me this is rather a wider environmental matter involving the governments and agencies of the provinces, the adjoining states and the two countries.


Allan Frederick Lawrence: As I understand it, only this government refines radioactive materials in this country. Only this minister is in charge of any cleanup or radioactive materials in this country. What other regulatory body is charged with the responsibility of cleaning up this junk in the Great Lakes if it is not the minister?


Alastair William Gillespie: Mr. Speaker, if the hon. member were familiar with the Act he would know that the AECB has responsibility where it has licensed a particular activity which is producing radioactive waste. If there is a facility which is producing radioactive waste which has not previously been licensed by the board-perhaps on the other side of the border-there is no responsibility on the part of AECB for that activity.
Second, the hon. member should know that the source of radioactivity in this country is not necessarily always manmade. I think we have been made very aware of this with respect to the houses which were built on the natural outcroppings of rock in the Elliot Lake area, and there is no authority under law which gives the AECB the responsibility on that one. In fact, we have worked with the province involved and with other federal government agencies to effect a cleanup. Where radioactivity occurs naturally, the AECB does not have prime responsibility.


Allan Frederick Lawrence: Who has to clean it up if it is not you?
Oral Questions HEALTH


POSSIBILITY OF STUDIES TO DETERMINE EFFECTS OF ORGANIC AND INORGANIC POLLUTANTS
Mr. Paul Yewchuk (Athabasca):: Mr. Speaker, my supplementary question is for the Minister of National Health and Welfare. It also arises out of the report of the International Joint Commission on water quality in the Great Lakes. In view of the lack of available information about the adverse effects of various pollutants, both organic and inorganic, in view of the lack of information on the effect these pollutants might have on public health and in view of the fact that when information is available there are differing opinions amongst the various jurisdictions as to the seriousness of these effects, can the minister say whether he has initiated or whether he intends to initiate any special studies to determine exactly what effects these pollutants do have on public health?
Hon. Marc Lalonde (Minister of National Health and
Welfare): Mr. Speaker, I have not had an opportunity to get acquainted with the press article to which the hon. member has referred. I will read it and I will be very happy to comment on it.


ENVIRONMENT AL AFFAIRS
Paul Yewchuk: Mr. Speaker, my supplementary question deals with another report on pollution in the St. Lawrence River which has been handed to the Minister of the Environment and which suggests that there is an immediate threat to the health of people living along the St. Lawrence, particularly from bacterial contamination. I want to know whether the minister plans to take any immediate action to remove this health hazard which is rather urgent at this time.


Hon. Romeo LeBlanc (Minister of the Environment):: Mr. Speaker, the hon. member is obviously referring to a preliminary report of the Canada-Quebec study group. It is a federal-provincial group which is studying the St. Lawrence from Cornwall to Montmagny. The group detected some problems which needed more immediate attention than the five-year program of study which they had undertaken. They did discover two main problems, one of heavy metals-mercury, etc.- and one which was biological, pollution from municipal waste. This group has suggested that both levels of government should carry out immediate testing and checking, and then the health authorities could be brought in.
4638
Oral Questions ENERGY

April 5, 1977


OIL-JUSTIFICATION FOR PRICE INCREASE-EFFECT ON UNEMPLOYMENT
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I have a question for the Minister of Energy, Mines and Resources. Unbelievably it has been reported that the federal government will propose to the provinces tomorrow a $2 per barrel increase in the price of oil. Considering that such an increase will cause on a national basis the loss of approximately 80,000 new jobs-I say this on the basis of a study that was done by the Ontario government two years ago at the time of the last major decision for a price increase-and considering that this comes at a time when we already have more than a million unemployed in Canada, can the minister provide the House with whatever conceivable justification he can give for such an increase at this time?


Alastair William Gillespie: I think I have made very clear in the past the reasons for moving the Canadian price up to the international price. At present the Canadian price is the lowest price anywhere in the world. We have been criticized-and I think the hon. member has not been reluctant to add his own criticism-for our conservation measures not being what they might be. The main reason our conservation measures have been criticized by the international energy agency is that our price is so much lower than the prices in the rest of the world.
1 have also made it very clear that in addition to conservation reasons there are other reasons connected with bringing in new supplies. There is a cash flow problem and there is equally a problem with respect to the kinds of resources for which we are looking. They are a long way off and more difficult to find than they were in the past. If the hon. member is still not satisfied with that, perhaps he would like to examine the case in law and the case in politics of the producing provinces. It seems to me they have a case to make, and I am sure they will make it.


John Edward Broadbent: The minister knows full well that other conservation measures would be more appropriate. I will preface my question. Considering that, with the present price of oil, increases of significant proportion in exploration have already taken place in Canada during the past year which would nullify the need for an increase in price to get more exploration, is the minister in agreement that this absurd proposal coming from the federal government will cost us 80,000 new jobs and, if so, what does he plan to do about it?


Alastair William Gillespie: In my view it will not have that kind of price tag at all.


OIL-EFFECT OF PRICE INCREASE ON CONSUMER PRICE INDEX
John Edward Broadbent: I should like to ask him a question on another aspect of the same issue. Considering that an increase of this magnitude will result in an

average increase of 8 cents per gallon for fuel either to run a car or to heat homes and, according to responsible authorities, will lead to an approximate one per cent increase in the consumer price index, has the government considered the impact of the decision to increase the price of oil, that is the impact on the cost of living about which ostensibly the budget we heard the other night was so much concerned?


Alastair William Gillespie: Yes, Mr. Speaker, very much so. As the Minister of Finance has made clear on other occasions, and I have too, the federal government's policy is to move the price of oil toward world prices, but we have moved it rather more slowly than many have suggested we should precisely because we have tried to cushion Canadians against the increasing impact of rising prices. That in itself has been an expensive program. At present I think something like $4 billion have been provided by way of subsidies to cushion the Canadian price and at the same time to maintain a downward pressure on the price index. So we have been trying to move forward but to move in slow and measured steps.

[ Translation]


INQUIRY OF THE MINISTRY
Mr. Rene Matte (Champlain):: Mr. Speaker, my question is directed to the Prime Minister.
Even if on December 3 last I was speaking ironically with a sarcastic after-taste when congratulating the right hon. Prime Minister for having instigated the present constitutional crisis in Canada, some revelations I heard urge me to ask him to answer the following questions:
Would the right hon. Prime Minister tell the House whether he has already been a militant, or more specifically, whether he has been or still is a member of a secret association which recommends a conciliatory attitude towards independence in Quebec?


Some hon. Members:: Shame!


Mr. Hnatyshyn:: The Prime Minister nodded yes.


An hon. Member:: Come clean, Pierre.


ENVIRONMENTAL AFFAIRS
William Herbert Jarvis: Mr. Speaker, my question is directed to the Minister of Fisheries and the Environment. It relates to two recent alarming reports, the first on the Great Lakes, prepared by the International Joint Commission and dealing with water quality levels, the second being the report
April 5, 1977


William Herbert Jarvis: Mr. Speaker, a supplementary question. In view of the statement by Dr. Brydon, Director of the Contaminants Control Branch that they were not really sure what the mercury problem is, will the minister tell the House when his research program will have these vital answers? Will he be in a position to table the regulations that he just spoke of under that new Act and by what date? Will it be this calendar year or not?


Roméo LeBlanc: Mr. Speaker, I am not familiar with what Dr. Brydon said. 1 am sure he explained that in the case of mercury, some is from industrial wastes and some is in the natural state. It is certainly the case in certain areas of northern Canada where there are heavy concentrations of natural mercury which are very difficult to deal with. As for the schedule of the regulations which the hon. member raised, obviously, I am willing to make them public as soon as they are devised and put forward but I will have to look at the exact date.


TARGET DATES FOR CLEANING UP THE GREAT LAKES
William Herbert Jarvis: 
AGRICULTURE
Mr. Roch La Salle (Joliette):: The Minister of Agriculture being absent, Mr. Speaker, I shall direct my question to his parliamentary secretary.
Since there is something positively untrue in the announcement the minister made yesterday on the new dairy policy, in that the target returns level of SI 1.86 will be reduced by the in-quota levy of $1.20, thereby ensuring net returns of $10.66. Therefore, in order to correct this evident mistake in the announcement, would the Parliamentary Secretary to the Minister of Agriculture agree to recommend to the minister that the federal government assume the total costs associated with the export of surplus skim milk powder?


Mr. Irenee Pelletier (Parliamentary Secretary to Minister of Agriculture):: Mr. Speaker, the dairy policy which the Minister of Agriculture announced yesterday has been worked out in consultation with the nine provinces represented on the supply management committee, and I doubt very much that the minister would now be willing to consider any change- this being an agreement at the national level-to the policy announced yesterday.


POSSIBILITY OF REDUCING CHEESE IMPORTS TO INCREASE DOMESTIC PRODUCTION
Roch La Salle: Mr. Speaker, on a supplementary.
In view of the importance of increasing Canadian production as related to Canadian consumption, can the parliamentary secretary tell the House whether his government intends to reduce cheese imports to favour the expansion needed by the dairy industry in this country?


Irénée Pelletier: Mr. Speaker, for three years now the Canadian government has limited cheese imports to 50 million pounds
8001 2-1 5'/2

April 5, 1977
Oral Questions
a year. Since Canadian consumption has gone up and imports have been kept at 50 million pounds, it goes without saying that overall, Canadian producers have benefitted from the situation. Of course, some cheeses will always be imported: about 200 of them come from abroad but there are still 63 kinds being made here in Canada. Some Canadian cheese producers might be well advised to start producing some of the cheeses now being imported.


EXTERNAL AFFAIRS
Miss Flora MacDonald (Kingston and the Islands):: Mr. Speaker, my question to the Secretary of State for External Affairs follows earlier questions regarding current negotiations on nuclear safeguards with European Economic Community countries. Could we have a precise response from the minister on whether the bilateral safeguards being negotiated with West Germany, Italy and Great Britain will prohibit those countries from exporting nuclear fuels to an EEC country which has not signed the non-proliferation treaty? If so, has the minister sought a legal opinion on whether these safeguards would take precedence over those provisions of the Euratom treaty and the treaty of Rome which allow for the unrestricted flow of nuclear materials between EEC countries. In other words, would these safeguards now being negotiated be legally binding?


Mr. Fraser:: Yes or no.


Hon. Donald C. Jamieson (Secretary of State for External Affairs):: Yes, Mr. Speaker. I think that covers it all. Unless the agreements bilaterally are of the nature which prevents the transfer to other member countries within the European community, we will not sign that agreement and those supplies will be held up.


POSSIBILITY OF TRANSSHIPMENT OF CANADIAN URANIUM TO SOVIET UNION VIA WEST GERMANY
Flora Isabel MacDonald: A supplementary question, Mr. Speaker. May I ask the minister if what he said applies specifically to France? Will these safeguards prohibit the export of nuclear fuels or technologies from EEC countries to France, which has not signed the NPT? I ask the minister as well about a matter referred to in the Globe and Mail of February 16. Speaking of West Germany's need for uranium, the article from which I wish to quote says in part:
The only EEC country in a bind so far as a result of Canada's uranium embargo is West Germany, which needs the uranium to ship to the Soviet Union to fulfil an enrichment contract.

I ask if Canadian uranium has been or will be transshipped to the Soviet Union via West Germany, with the approval of the Canadian government?


Donald Campbell Jamieson: Mr. Speaker, there is a great deal of questioning in that lengthy inquiry. I will do my best to reply. So far as the relationship with France is concerned, I said previously "all the members of the European community." Obviously, France is a member. Certain elements of the safeguards proposal are not applicable to nuclear weapon states, but this does not change the answer I gave the hon. lady earlier.
Answering the second part of the question, I would have to inquire about the newspaper story. It has not been drawn to my attention and I really do not know if it is factual. I will have to get additional information and respond as soon as I can.


FINANCE
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, my question is for the Minister of Finance. In view of the statement the minister made during his "Question Period" appearance on Sunday to the effect that the $50 per child tax credit is directed primarily at those with middle and lower incomes, to assist them to meet the rising costs of food and other necessities of life, and since there are about one million families in Canada, or more, which are at the borderline breaking point, at the $7,000 level, and who because they pay no income tax will therefore get no tax credit, what steps will the minister take, to assist those people, those million families, to meetjtheir rising living costs?


Hon. Donald S. Macdonald (Minister of Finance):: Mr. Speaker, the measures were proposed for the purpose of lifting the taxation load. The hon. gentleman is suggesting an additional expenditure program and, as he knows, the government has set a maximum for itself in terms of its over-all expenditures. While there have been discussions with the provinces, under the jurisdiction of my colleague the Minister of National Health and Welfare, we do not at the moment have an additional transfer payment program for individuals to announce.


SOCIAL SECURITY
Stanley Howard Knowles: Mr. Speaker, may I direct a supplementary question to the Minister of National Health and Welfare. In view of the admission of the Minister of Finance that families in the $7,000 to $11,000
April 5, 1977

income bracket need the $50 per child credit right now to meet rising living costs, and in view of the reference the Minister of Finance made to the Minister of National Flealth and Welfare, what will that minister do to assist those people who are in particular need?


Hon. Marc Lalonde (Minister of National Health and Welfare):: Mr. Speaker, at present we do not have the resources to provide additional benefits to that particular income group but are working on proposals of income support and income supplementation which have the support of several provinces. I hope we can put those forward in due course.


Stanley Howard Knowles: Mr. Speaker, may I ask a final supplementary question. Will one of those two ministers explain why the government uses its resources to give more wealth to the wealthy and then says it cannot do anything for the poor?


INDUSTRY
Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, my question is for the Minister of Industry, Trade and Commerce. Since this country's $10 billion a year deficit in manufactured goods is the main reason for Canada's present record unemployment, is the government planning to require those who ship primary products from this country in their raw state to process a far higher proportion of those raw materials in this country to their finished state, thus providing much needed jobs for Canadians rather than for those living in the countries to which our raw materials are shipped?
[ Translation]


Hon. Jean Chretien (Minister of Industry, Trade and Commerce):: Mr. Speaker, that is exactly the policy the government is following. When this is feasible, we always insist that Canadian natural resources be processed as much as possible here in Canada, but that is not always practical.


George Harris Hees: A supplementary question, Mr. Speaker. Since this government's so-called policy has not resulted in an increased proportion of our raw materials being processed in this country to their finished state, is it any wonder, with the government taking this attitude and doing nothing, that we have record unemployment today and it looks as if we will have it for a long time.


Joseph Jacques Jean Chrétien: Mr. Speaker, 1 want to answer that question because the hon. member is sometimes seen here to ask his questions, but when we are in committee to discuss problems in depth, we never see him there.
Oral Questions


SMALL BUSINESS
Mr. F. Oberle (Prince George-Peace River):: Mr. Speaker, my question is directed to the minister of state responsible for small business and has to do with the repeated reports which have emanated from British Columbia in recent months about the incredible number of small business failures in the province. A newspaper in the minister's home town, in his constituency, has listed a full page of business failures. I realize, of course, that that is not directly connected with the minister's appointment, nor with his portfolio. Can he tell the House whether there is any special program which the government has in store and which was not reflected in the budget in order to offer a solution to this most critical program, particularly in British Columbia?


Hon. Len Marchand (Minister of State (Small Businesses)):: Mr. Speaker, we have no particular program-


Some hon. Members:: Hear, hear!


Len Marchand: -that is looking at business failures. Business failures have always been a part of the private enterprise process. We must have private entrepreneurs who are willing to get out and take risks. Some of them fail, some of them do not. I am, however, looking at policies that will generally create a better over-all economic climate for small business. That has certainly been the aim of the recent budget.


Some hon. Members:: Hear, hear!


Frank Oberle: Mr. Speaker, if it is the minister's intention to eventually develop a program which will address itself to the very special problems small business in this country experiences, will he also address himself to the fact that the Small Businesses Loans Act, which is one of the programs that would have offered a partial solution to these problems, could be activated? Will he, together with the Minister of Finance, attempt to convince the banks to make these small loans in spite of the fact there is not the kind of profit normally experienced with a conventional loan? Has there been an approach to the banks to encourage them to make these loans?


Len Marchand: Mr. Speaker, the answer to all of the questions is yes. Amendments to the Small Businesses Loans Act were introduced yesterday.


Some hon. Members:: Hear, hear!


Len Marchand: I think the amendments are very significant for the small business community. I have talked to the Canadian Bankers Association and a number of individual bankers. As a result of the amendments we introduced yesterday and perhaps some others changes in the regulation, especially the interest rate, the banks will be very active in making these

April 5, 1977
Oral Questions
small businesses loans. This is something that will be very useful for small business.


REMOVAL OF CAPITAL GAINS TAX FROM TRANSFER OF BUSINESS FROM ONE FAMILY MEMBER TO ANOTHER- GOVERNMENT ACTION
Mr. Otto Jelinek (High Park-Humber Valley):: Mr. Speaker, I have a question for the same minister. Further to my questions of last week based on certain small business issues advocated by this party and consequently by the minister himself-and unfortunately excluded from the budget-will the minister advise in what way and through what forum he intends to introduce such promises he has been making as removing the capital gains tax on transfers of a business from one family member to another? When can we expect these issues to be brought before parliament?


Len Marchand: Mr. Speaker, in the paper that 1 expect to present to cabinet later in the year, 1 will be addressing the whole question of the financial environment for the small business community. Tax measures, of course, will have to be announced by the Minister of Finance in the normal way.


POSSIBILITY OF MORATORIUM ON FORECLOSURES- GOVERNMENT POSITION
Mr. W. C. Scott (Victoria-Haliburton):: Mr. Speaker, I have a question for the minister in charge of small businesses. In view of the fact that a number of departments are foreclosing on overdue mortgages as a result of the slackness in the economy, what measures does the minister consider appropriate to deal with these foreclosures in the hope there will be some improvement in the economy this summer whereby these businesses can restore their standing with the departments?
Mr. Speaker, my question is for the minister in charge of small business. In view of the foreclosures some of his departments are now making on small businesses due to the slackness in the economy which we have been experiencing over the past year, will the minister grant a moratorium so that they can try to improve their financial standing during the summer months when it is hoped the economy will pick up?


Len Marchand: Mr. Speaker, I do not know what we can do in terms of loans made through chartered banks or other financial institutions. If the hon. member is talking about certain loans under the Small Businesses Loans Act or from the Federal Business Development Bank, I will be happy to have a look at the problem to see what can be done. The Federal Business Development Bank is certainly concerned about small business. They want to be as helpful as possible in ensuring that small businesses survive and indeed thrive in this country.


ADMINISTRATION OF JUSTICE
Mr. Pierre Bussieres (Portneuf):: Mr. Speaker, I have a question for the Solicitor General.
Recently, Quebec Minister of Social Affairs Dr. Denis Lazure criticized the federal bill on young offenders and suggested that the age of responsibility for young people should be 15 or 16. I would like to know if the Solicitor General and the officials of his department have considered setting the age of responsibility at 15 or 16?


Hon. Francis Fox (Solicitor General):: Mr. Speaker, the whole matter of the young offenders bill was the subject of in-depth consultations between the federal and the provincial governments. In fact, the initial position of the federal government was to set the age of criminal responsibility at 14. It is only following meetings and consultations with the provinces and at the request of the great majority of provinces, except Quebec, that we suggested a minimum age of 12. This matter was recently the subject of a federal-provincial conference of deputy ministers including the Quebec Deputy Minister of Justice. For our part, Mr. Speaker, if the Quebec Minister of Social Affairs wishes to consult his colleague the Quebec Attorney General, he will probably be told that the province of Quebec, through its Attorney General, has all the freedom required to continue to lodge complaints under the Youth Protection Act rather than under the Juvenile Delinquents Act. This shows the great flexibility that we have injected in the bill on young offenders.


PROPOSED EXAMINATION OF CONCEPT OF EXECUTIVE PRIVILEGE-GOVERNMENT POSITION ON POSSIBILITY OF CHANGE
Elmer MacIntosh MacKay: Mr. Speaker, I have a question for the Minister of Justice. Will the minister examine the legal merits of the so-called executive privilege concept and ascertain whether it was in fact if not extinguished, substantially reduced, by the Bill of Rights in 1688 in England? Will the minister examine the decision in the United States Supreme Court in the case of the United States versus Nixon to ascertain whether the claim of executive privilege there denied was based on similar jurisprudence that could be applicable in this country?


Hon. Ron Basford (Minister of Justice):: Yes, Mr. Speaker, but the privilege claimed on very rare occasions in this country is either the privilege that relates to the oath of office of Privy Councillors or the provisions in the Federal Court Act.


Elmer MacIntosh MacKay: Is the minister prepared to change or soften existing government policy which restricts the type of testimony that is available to members in parliamentary committees, such as recently happened in the Ontario Municipal Board and
April 5, 1977

before that on different occasions in the National Energy Board?


Stanley Ronald Basford: Mr. Speaker, contrary to press reports, there was no privilege claimed in the Ontario Municipal Board by any member of the federal civil service or of the National Capital Commission. With regard to appearances before a parliamentary committee, 1 would think that is a matter for the rules department.


MANPOWER
Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker, my question is to the Minister of Manpower and Immigration who has tabled the promised statistics on job vacancies registered at Canada Manpower Centres at the end of each month. Is the minister now prepared to admit that he provided the House with false and misleading information when on March 21 and again on March 23 he claimed, and I quote, "At the end of any given month some 100,000 vacant jobs are available just through Canada Manpower Centres"? In fact the figure at the end of January 1977 was less than half that. Even if the casuals of 8,413 are added, only 52,176 job vacancies could be registered at that particular time.


Hon. Bud Cullen (Minister of Manpower and Immigration):: Mr. Speaker, the answer to my good friend is no.


Lincoln MacCauley Alexander: A supplementary question, Mr. Speaker. It seems to me that the minister has not learned the difference between stock and flow statistics. Will the minister now tell the House how he expects success from his department's so-called active job search program which forces unemployment insurance claimants to register at Canada Manpower Centres, when using the minister's figures there are 18 times as many claimants as job openings at these centres?


Jack Sydney George (Bud) Cullen: Mr. Speaker, different people have different skills which they wish to register. Apparently they have more confidence in the CMC than does the hon. member. We placed something in excess of one million people last year, which seems to me not a bad record.


ADMINISTRATION OF JUSTICE
Mr. G. W. Baldwin (Peace River):: Mr. Speaker, I have a supplementary question for the Minister of Justice following that asked by the hon. member for Central Nova. Pending the
Oral Questions
introduction of legislation concerning information which, even to the government's friends in Toronto, seems to have had an inordinately long gestation period, 1 should like to ask the hon. gentleman if he is prepared to follow the practice established in the Nixon case, referred to by my friend, and in the case of the Crosland diaries in the United Kingdom by the Lord Chief Justice, and lay down a doctrine to provide that the courts will have the right to examine material and documents to determine if they are in fact cabinet documents or simply an attempt to cover up embarrassing or politically damaging material?


Stanley Ronald Basford: Mr. Speaker, without in any way accepting the inflammatory words in the hon. member's question which have no foundation, it would seem to me that the members of the administration are governed by the Federal Court Act and both the rights and responsibilities set out therein.


EXTERNAL AFFAIRS
Mr. Bob Wenman (Fraser Valley West):: Mr. Speaker, my question is for the Secretary of State for External Affairs. Is the United States state department exploring with Canada the possibility of fresh water exports this year to help alleviate shortages in the Pacific northwest?


Donald Campbell Jamieson: Mr. Speaker, I have no personal knowledge of any such negotiations. I will make inquiries and respond later.


Robert Lloyd Wenman: A supplementary question, Mr. Speaker. Does the minister support in principle the concept of the export of Canadian fresh water supplies to the United States?


Donald Campbell Jamieson: Mr. Speaker, when I find out what is being done, if anything is being done, I will then decide whether or not I am in agreement with it.


UNEMPLOYMENT INSURANCE
Mr. John Rodriguez (Nickel Belt):: Mr. Speaker, my question is directed to the minister responsible for unemployment. In view of the fact that 18,000 people were unjustly disentitled from unemployment insurance benefits because they were over the age of 65 when Bill C-69 came into effect, and in view of the fact that the minister told this House on February 10 that he was satisfied with information from the Department of Justice that it would not be necessary to amend the Unemployment Insurance Act in order for these people to be paid the

April 5, 1977
Oral Questions
money owing to them, could the minister tell the House why his department is now refusing to make those payments?


Jack Sydney George (Bud) Cullen: Mr. Speaker, as I have indicated, given the numbers to which the hon. member has referred it did seem appropriate to take, as we did take, the necessary step of contacting the individuals personally to see whether they do in fact qualify. Justice indicated that we had the authority, but so that there will be no doubt we propose to suggest an amendment at the committee stage of the bill.


John R. Rodriguez: A supplementary question, Mr. Speaker. In view of the fact that when these people do go to their local office and apply for benefits they are being told by officers of the minister's department that an amendment must be made to the Unemployment Insurance Act, would the minister promise the House that he will inform the minions in the local offices that they are to process the applications of these people so they can obtain their benefits?

[ Translation]


AGRICULTURE
Mr. C. A. Gauthier (Roberval):: Mr. Speaker, in the absence of the Minister of Agriculture I would direct my question to his parliamentary secretary.
Since the minister established at 10,560 million pounds the industrial milk total market share for Canada, could the parliamentary secretary state whether the increase in quotas will be alloted free to producers who had their quotas reduced, or whether they will have to pay for this surplus?


Irénée Pelletier: Mr. Speaker, it is specified in the policy announced yesterday that producers remaining within the dairy policy guidelines will of course receive subsidies as announced. Of course, in the cases where a province exceeded their quotas, there may be a penalty as indicated in the dairy policy.


Charles-Arthur Gauthier: Mr. Speaker, I have a
supplementary.
Mr. Speaker, I would like to rephrase my question. I am asking the parliamentary secretary whether producers will get those extra quotas without having to pay, free in other words, or whether they will have to pay for them? That is the answer I would like to receive.


Irénée Pelletier: Mr. Speaker, offhand I do not have that information. I will inquire and report to the hon. member as soon as possible.


ANTI-INFLATION PROGRAM NAMES OF UNIONS DISCUSSING POST-CONTROL RESTRAINT- POSSIBILITY OF BYPASSING CANADIAN LABOUR CONGRESS
John Allen Fraser: Mr. Speaker, my question is for the Minister of Labour. The policy of the government until now seems to have been to talk directly with the officers of the CLC regarding post-control restraint. However, the Minister of Finance said, as reported in Saturday's Globe and Mail, that the voluntary commitment to wage restraint would have to come from major unions rather than just the CLC. Yesterday the Minister of Finance said that the Minister of Labour-to quote him-"has been meeting with a number of unions in addition to the Canadian Labour Congress". Can the minister tell the House which unions he has been meeting with, when these meetings took place, and whether these unions are affiliated with the CLC?


Hon. John C. Munro (Minister of Labour):: Mr. Speaker, I do not see anything inconsistent in what the Minister of Finance said. Most of the major unions are members of the CFC. Indeed, their principal officers sit on the executive of the CLC. There are unions, and influential ones at that, however, not part of the CLC. Certainly the CSN would have to be rated as one of those, and I have been meeting with that particular union.


John Allen Fraser: A supplementary question, Mr. Speaker. As it is now apparent that the government has no commitment to restraint from the CLC leaders, despite the statement of the Minister of Finance last week that there was a commitment on the part of representatives of the CLC to speak out in favour of restraint, is the government now trying to obtain commitments to restraint directly from certain unions in major industries? In other words, is the government now prepared to go around the senior officials of the CLC?


John Carr Munro: No, Mr. Speaker.
 * *


HARBOURS
Mr. Cecil Smith (Churchill):: Mr. Speaker, my question is for the Minister of Transport. On February 17 the minister announced that Mr. Donald Figurski of Winnipeg had been appointed interim manager for the port of Churchill from the end of April until the early part of November. I would ask the minister why this appointment did not take place.


Hon. Otto E. Lang (Minister of Transport):: Mr. Speaker, I would have to check back on the present state of the matter and will report to the hon. member later.


Cecil Morris Smith: A supplementary question, Mr. Speaker. It was just one year ago this April that we had a
April 5, 1977

problem at Churchill with port managers. I should like to ask the minister whether we can expect the same sort of treatment again this year.


Otto Emil Lang: Mr. Speaker, 1 would remind the hon. member that the only problem with port managers which we had was his constant expressions of concern, later followed by his appreciation that a very good manager had been appointed. We had a superb year and set an all-time record.


COMBINES
Mr. Jake Epp (Provencher):: Mr. Speaker, I would like to direct my question to the Minister of Consumer and Corporate Affairs. On March 10, as recorded at page 3840 of Hansard, I asked the minister, in view of the fact that Canadian manufactured fertilizer was selling in the United States at an average of $25 per ton less than in Canada, if he would bring the representations to the attention of the director of the combines investigation branch and he responded that he would. 1 would like to ask the minister if the director has undertaken an investigation of fertilizer pricing in Canada, and if so, when can Canadian farmers expect the results of that investigation?


Hon. A. C. Abbott (Minister of Consumer and Corporate Affairs):: Mr. Speaker, as indicated in my reply, I have brought this question to the attention of the director of the combines investigation branch. As the hon. member may be aware, charges were laid in Calgary against a series of fertilizer companies in western Canada on January 16, 1976 relating to possible violations of section 32(1)(c) of the Combines Investigation Act. The preliminary trial is still in process.


Arthur Jacob (Jake) Epp: I would like to ask the minister in view of the fact that those charges were laid a year ago and that there are pricing policies of the same type going on for this next crop year, whether in fact there has been a comprehensive investigation by his department and when we could expect those results.


Anthony Chisholm Abbott: Because an action had been brought, I was assuming that there had been a comprehensive inquiry. 1 will have to make further inquiries along the lines the hon. member suggests.


FINANCE
Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, I have a question for the Minister of Finance. In view of an opinion
Oral Questions
expressed by a high official in Quebec Hydro that only borrowers of such size as Quebec Hydro should dip into the United States capital market at this time, does the minister subscribe to the view that only selective borrowers, such as Quebec Hydro, should go into the U.S. market this year in view of the limitations developing in that market?


Donald Stovel Macdonald: No Mr. Speaker, we are not suggesting any limitation on access, either to the American or the other foreign markets.


Mr. David MacDonald (Egmont):: Mr. Speaker, I rise on a point of order. It relates to a question in the adjournment debate I raised last night with respect to the provision of new rail cars for the shipment of potatoes from eastern Canada. There is a minor point I wish to make. There are two inaccuracies in Hansard; at page 4632, line 11, it should read: "800 to 1,000 reefers be provided" and at line 52 it should read "exporting numbers of jobs in Prince Edward Island." These are minor points. What is major, however,-and it verges on a question of privilege-is in the answer from the parliamentary secretary with respect to the current status of the government's position on provision of new railroad cars. The parliamentary secretary referred to reports with recommendations that have been made from the Department of Agriculture and the Department of Transport. Subsequently a meeting of officials was to take place on April 12.
Under the provisions of the rules there is no opportunity to ask for the tabling of important reports like this or making them available to interested parties. The Minister of Transport (Mr. Lang) or his parliamentary secretary should have indicated last night whether or not this document will be tabled in the House and would be made available to members generally. Now that the Minister of Transport is here, 1 am wondering whether this particular document will be tabled. Without the document the repeated questions that I and other hon. members have put over the past four to six months become a bit of a mockery to the House and its service to the Canadian people. I would hope the minister would take the opportunity to table this important report which has apparently been made by officials with respect to future provision of railroad cars to eastern potato to producers.


Mr. Speaker:: Order, please.


David Samuel Horne MacDonald: Mr. Speaker, does this mean the Minister of Transport is not going to make available to the House the particular document referred to by his parliamentary secretary last night? This is the essence of a series of questions asked by myself, the hon. member for Madawaska-Victoria (Mr. Corbin), the hon. member for Carleton-Char-lotte (Mr. McCain) and others. Without that document being publicly available, it is very difficult for the government and for those specifically involved in the potato industry to come to an effective decision on this matter.


Otto Emil Lang: Mr. Speaker, I have not had an opportunity of seeing the document. I will look into it so that I will know more about it.
4646
Petro-Canada



ROUTINE PROCEEDINGS

[Stage Direction]
April 5, 1977

Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, under the provisions of Standing Order 41(2), I wish to table in both official languages a copy of an order in council requiring that writs of election be issued for six electoral districts and that the vote be held on Tuesday, May 24, 1977.
* *
*


TABLING OF 1976 ANNUAL REPORT OF PETRO-CANADA
Alastair William Gillespie: Mr. Speaker, pursuant to Standing Order 41(2), I should like to table, in both official languages, copies of the 1976 annual report of Petro-Canada.


Mr. Ren6 Matte (Champlain):: Mr. Speaker, I wish to raise the question of privilege in relation to the fact that a moment ago, while recognizing your high ability, I realized that perhaps you had too hastily prevented the right hon. Prime Minister (Mr. Trudeau) from answering a question which you may have prejudged. Therefore, I wish to point out that that matter, far from being foolish, was so important that it involved the very plight of this country and in part the future of our nation.


An hon. Member:: Sit down!


René Matte: If, Mr. Speaker, we can prove beyond any doubt that the right hon. Prime Minister of Canada has taken or is still taking part in a movement which secretly advocates Quebec independence, the people of this country must know precisely with whom they are dealing whenever somebody is standing as the champion of the opposite solution, that is a Canadian federalism. Consequently, I intend-and it is my privilege to do so-to prove to the House that this was a serious matter since I can bring some evidence before the House. Therefore, and this is the subject matter of my question of privilege, the right hon. Prime Minister should be given an opportunity to answer my question though it may seem at first sight-


An hon. Member:: Weird.


René Matte: -weird, as he himself might say. In my supplementary, I intended to give more specific information-


An hon. Member:: Order.


René Matte: -which would have surely compelled the right hon. Prime Minister to answer since I wanted to ask him

whether he had received a lengthy epistle from one of his Montreal friends who had stated those very things I am dealing with today.


An hon. Member:: Resign!


René Matte: Therefore, Mr. Speaker, I think you may have somehow prejudged my question so that-


Mr. Speaker:: Order, please. As I recall, I did not make any decision concerning the question of the hon. member for Champlain (Mr. Matte).
Ministers are not required to answer hon. members' questions. They may or may not answer a question put by an hon. member. Moreover, it is never incumbent on the Chair to intervene. If, after reconsidering the hon. member's question, the Chair believes it is in order, the hon. member will have the opportunity to put it again tomorrow.


TRANSPORT
Otto Emil Lang: Mr. Speaker, I ask the consent of the House to revert to motions at 5.30 this afternoon for the purpose of tabling, under Standing Order 41(2), copies of an agreement with the province of British Columbia respecting certain rail line matters. The time was chosen to coincide with a similar tabling of documents in British Columbia.


Mr. Speaker:: I understand the minister is seeking agreement for an order of the House that the document may be tabled at 5.30 this afternoon. Is that agreed?


Some hon. Members:: Agreed.


Mr. Speaker:: Agreed, and so ordered.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Ralph E. Goodale (Parliamentary Secretary to President of the Privy Council):: Mr. Speaker, the following questions will be answered today: Nos. 25, 1,489, 1,509, 1,609, 1,644, 1,954, 2,019, 2,070 and 2,079.
April 5, 1977


Mr. Cossitt: 1.	What is an up-to-date list of the names, job designations and annual salaries of all persons employed by, on loan to, attached to, under contract with, or in any other way associated with the office of the Prime Minister as of the date the answer to this question is prepared?
2.	On what date was the answer to this question prepared?


Pierre Elliott Trudeau: 1. See reply to Question 23 answered this day.
2.	The government takes responsibility for the answers it provides to questions on the Order Paper and for the process involved in replying to such questions. It is not appropriate therefore to provide information such as asked in this question about internal administrative workings.
Order Paper Questions


Ralph Goodale: In so far as the Department of Indian Affairs and Northern Development is concerned: 1. Funds provided up to December 31, 1976 totalled $1,700,500 as follows: Native Associations: Indian Brotherhood of the N.W.T., $566,500; Committee for Original Peoples Entitlement, $421,250; Council for Yukon Indians, $129,600; Inuit Tapirisat of Canada, $38,650; Total, $1,156,000. In addition to funding native organizations, the Mackenzie Valley Pipeline inquiry provided funds to the following participants from April, 1974 to December 31, 1976: Northern Assessment Group, $421,500; N.W.T. Association of Municipalities, $95,000; N.W.T. Chamber of Commerce, $25,000; N.W.T. Mental Health Association, $3,000; Total, $544,500. Grand Total, $1,700,500.
2. In so far as Agriculture Canada and Environment Canada are concerned: nil.


Mr. Rynard: 1.	What was the total cost for land acquisition for the new government building in Barrie, Ontario?
2.	What was the (a) estimated (b) final cost of construction of the building?
3.	What is the total amount of office floor space available?
4.	What government departments are to be located in the building?
5.	What was the estimated cost of the original addition which was considered to the existing federal building located on Collier Street, Barrie, Ontario?


Mr. Alexandre Cyr (Parliamentary Secretary to Minister of Public Works):: 1. $324,608.
2.
(a) Estimated
(b) final cost
Consultants
Construction
Miscellaneous
$	91,500
1,605,000 61,000
$	85,000
1,412,104 54,246
Total
$1,757,500	$1,551,350
3.	37,000 square feet-rentable; 33,400 square feet usable.
4.	Canada Manpower Centre, Unemployment Insurance Commission.
5.	Estimated total project cost, $1,206,433 for 23,400 square feet usable area.


Mr. Herbert: How many branch post offices are there in the Constituency of Vaudreuil and where are they located?


Hon.   J.-J. Blais@Postmaster General: There are 31 postal outlets in the constituency of Vaudreuil: St. Lazare; lie Perrot South, 2265 Perrot Boulevard; Les Cedres, 62 Principale Street; Ste. Justine de Newton; St. Polycarpe, 82 Elie Auclair Street; Dorion-Vaudreuil, 35 St. Clares Street; Hudson Heights, Oakland Avenue; Dalhousie Station; Ste. Marthe, 618 Principale Street; Rigaud, 33 St. Viateur Street; Hudson, 99 Cameron Street; Riviere Beaudette, 267 Principale Street; Dorion-Vaudreuil Sub 7, 18 St. Michel Street; St. Zotique, 1165 Principale Street; St. Telesphore, 1401 Route 340; Dorion-Vaudreuil Sub 3, corner of 5th Avenue and Cardinal Street; Pointe Fortune, 698 des Outaouais Boulevard; Coteau-du-Lac, Chemin de la Reine; Coteau-Landing, 180 Principale Avenue; St. Clet, 234 Principale Street; Coteau-Station, 106 Lippe Street; Pointe-des-Cascades, 121 du Fleuve Road; Rox-boro Sub 12, 17055 Ste. Marie Kirkland Road; Ste. Anne-de-Bellevue Sub 4, 90 Morgan Road, Baie d'Urfe; Ste. Anne-de-Bellevue, 49 Ste. Anne Street; Pierrefonds Postal Station Roxboro; Ste. Anne-de-Bellevue Sub 2, 50 St. Clares Road; Ste. Anne-de-Bellevue Sub 1, 450 Beaconfield Boulevard; Ste. Anne-de-Bellevue Sub Macdonald, College 3, Macdonald College; Gardenvale, 1 Pacific, Ste-Anne-de-Bellevue; Ste. Anne-de-Bellevue Postal Station, 186 Sutton Place, Beaconfield.


Mr. Mazankowski: 1.	What was the total amount, up to December 31, 1976, that the government granted to various native peoples, groups, corporations and environmental associations to study the environmental and social impact of the proposed Mackenzie Valley Gas Pipeline?
2.	What was the total amount that the government granted to various agricultural protection associations, corporations and environmental associations to study the environmental and social impact of the proposed, and recently postponed $2 billion Round Hill-Dodds Power Project in Alberta?


Mr. Marshall: What are the considered priority objectives in a period of restraint in funding Fitness and Amateur Sport projects (a) Aerobic demands of badminton relative to skill level ($1,300) (b) Canadian Synchronized Swimmer Project (CANSYN) ($4,800) (c) Exercise management recruitment and retention project ($5,000) (d) Implementation of a lifestyle modification program and initiation of a functional fitness ($2,825) (e) Biomechanical analysis of the jumping skills in volleyball ($22,500) (0 Hypothermia: Energy cost of cross-country skiing in mountain areas in relation to clothing, food intake, terrain and physical condi-
80012 - 161/2

April 5, 1977
Order Paper Questions
tioning ($22,090) (g) the development of a system of analysis of coach-athlete interaction ($8,329) (h) Physiology of ice hockey performance: Mechanisms and management of fatigue ($27,196) (/) Evaluation of swimming performance at the muscle level ($2,218) (j) An investigation of the energy cost of cross-country skiing among elite competitors ($3,443) (k) Morphometric measurements of mitochondrial volume and density in human skeletal following heavy resistance training ($2,070) (1) Autogenic training techniques for controlling arousal levels ($4,500) (m) A test of perception as an element of skill in volleyball ($7,500) (n) Synchronized swimming-determination of cardiorespiratory profile of elite performers ($7,220) (o) Assessment of the physiological demands of figure skating ($9,440) (p) An investigation of relationship among level of physical fitness, pace of living, selected personality characteristics and stress ($18,750) (q) The upgrading of SIRLS (an information retrieval system for the sociology and social psychology of leisure and sport) to an interactive national information resource ($9,480) (r) Leisure studies data bank: bilingualism project ($20,920)?


Hon. Iona Campagnolo (Minister of State (Fitness and Amateur Sports)):: The program objectives of the Fitness and Amateur Sport Branch of the Department of National Health and Welfare are listed below in order or priority: 1. To increase the appreciation for and understanding of fitness, physical recreation and amateur sport. 2. To improve the Canadian delivery systems of fitness, physical recreation and amateur sport. 3. To improve the quality of participation in physical recreation and amateur sport. Within this overall program, a relatively small amount of funds, $400,000, has been allocated for research studies in support of these program objectives. The research areas of priority in fiscal year 1976-77 and the revised listing for 1977-78 follows. These research priorities originate from external sources including national conferences, that is, National Conference on Health and Fitness, National Conference on Employee Physical Fitness, special task forces, that is, Task Force on Sport for Canadians, Sports Governing Bodies, the National Advisory Council on Fitness and Amateur Sport and others. Each research proposal submitted to its degree of relevancy to the branch's statement of research priorities for that fiscal year. If found to be sufficiently relevant, the proposal is then reviewed for significance in terms of whether the project has the potential for contributing new knowledge to the field and whether it is likely to yield findings of practical value in the solution of existing problems. A Final review is then conducted to assess the specific and technical validity of the methodology to be employed.
F.A.S. Research Support Program, Research Needs 197677: 1. The investigation of the role of physical activity, exercise, sport and other forms, in health promotion. Areas of particular interest are: Strategies for improving compliance to physical activity regimens. Socio-cultural influences of physical activity programs. The role of physical activity within a comprehensive lifestyle modification program. The mental health benefits of participation in physical activity. 2. The economics of fitness, physical recreation and sport. An area of particular interest is: The impact of physical fitness on work productivity and health care costs. 3. The identification of elements and skills that are specific to a sport; the development of tests to measure these elements and skills; the establishment of norms for male and female athletes for these elements and skills; and the development of training concepts and methods related to the training of athletes in these elements and skills.

F.A.S. Research Support Program Research Needs 197778: The development of acceptable safety standards for both equipment and facilities designed to protect participants in sport and play. The development of creative programs and methodologies for the teaching of sport skills to children. The factors influencing adults to become volunteers in sport and recreation associations. The effects of the school and the community in socializing youngsters into sport. The development of techniques and programs for modifying the behaviour of the adult population towards involvement in physical activity. The role of physical activity within a comprehensive lifestyle modification program. The development of strategies for improving compliance of healthy individuals to physical activity regimens. The influence of socio-cultural factors upon involvement in physical activity at various stages in the life cycle. The impact of physical activity programs on work productivity, absenteeism, employee morale, occupational stress and other parameters. The needs and problems of special groups including the poor, elderly, handicapped and immigrant groups with respect to their involvement in fitness, recreation and sport. The economics of recreation and sport. The identification of elements and skills that are specific to a sport. The development of tests to measure elements and skills that are specific to a sport. The establishment of norms for male and female athletes for elements and skills that are specific to a sport. The development of training concepts and methods related to the training of athletes in elements and skills that are specific to a sport.


Mr. Herbert: 1.	Is it the government's intention to construct a post office in St. Justine de Newton, Quebec and, if so, what is the location, size and cost of the land purchased?
2.	Have plans been prepared and have architects and engineers been selected?
3.	What is the anticipated date for the start of construction and by what date would the post office be operational?


Alexandre Cyr: 1. Yes. A parcel of land with a 70 foot front and 150 foot depth situated on rue Principale has been purchased at a cost of $5,000.
2.	Plans and specifications have been completed by architects and engineers of the Department of Public Works.
3.	Construction was started on February 28, 1977 and the post office is scheduled to be operational in July, 1977.


Mr. Knowles (Winnipeg North Centre): 1. How many retired Armed Forces personnel are receiving pensions, including their basic pensions and any supplement or supplements added thereto, of amounts within each of the following brackets (a) less than $20.00 per month (b) $20.00 to $29.99 per month (c) $30.00 to $39.99 per month (d) $40.00 to $49.99 per month (e) $50.00 to $59.99 per month (f) $60.00 to $69.99 per month (g) $70.00 to $79.99 per month (h) $80.00 to $89.99 per month (/)
April 5, 1977

$90.00 to $99.99 per month (j) $100.00 to $149.99 per month (k) $150.00 to $199.99 per month (1) $200.00 to $249.99 per month (m) $250.00 to $299.99 per month (n) $300.00 to $399.99 per month (o) $400.00 per month and over?
2.	How many widows of Armed Forces personnel or of retired Armed Forces personnel are receiving pensions, including their basic pensions and any supplement or supplements added thereto, of amounts within each of the brackets indicated in the above question?
3.	What is the total number of retired Armed Forces personnel and also the number of widows of Armed Forces personnel or of retired Armed Forces personnel presently residing in each province?
4.	In respect of how many orphans of Armed Forces personnel are pensions being paid and what is the average amount thereof?


Hon. Barney Danson (Minister of National Defence):: 1. As
of February 28, 1977, the number of retired armed forces personnel receiving monthly pensions totaled 50,020 within the following monthly brackets: (a) less than $20,00, 39; (b) $20.00 to $29,99, 55; (c) $30,00 to $39,99, 130; (d) $40,00 to $49.99, 246; (e) $50.00 to $59.99, 238; (f) $60.00 to $69.99, 184; (g) $70.00 to $79.99, 237; (h) $80.00 to $89.99, 391; (i) $90.00 to $99.99, 458; (j) $100.00 to $149.99, 2,207; (k) $150.00 to $199.99, 5,111; (1) $200.00 to $249.00, 7,426; (m) $250.00 to $299.99, 6,785; (n) $300.00 to $399.99, 9,773; (o) $400.00 and over, 16,740;
2.	The number of widows receiving monthly pensions totaled 5,243 as follows: (a) less than $20.00, 33; (b) $20.00 to $29.99, 40; (c) $30.00 to $39.99, 45; (d) $40.00 to $49.99, 34; (e) $50.00 to $59.99, 41; (f) $60.00 to $69.99, 58; (g) $70.00 to $79.99, 95; (h) $80.00 to $89.99, 106; (i) $90.00 to $99.99, 166; (j) $100.00 to $149.99, 1,057; (k) $150.00 to $199.99, 1,135; (1) $200.00 to $249.99, 876; (m) $250.00 to $299.99, 615; (n) $300.00 to $399.99, 529; (o) $400.00 and over, 413.
3.	The number of retired armed forces personnel and widows of armed forces personnel presently residing in each province is as follows:
Provinces	Personnel	WidowsNewfoundland	235	18Prince Edward Island	454	53Nova Scotia	5,011	473New Brunswick	1,925	185Quebec	4,195	555Ontario	19,151	2,199Manitoba	2,136	233Saskatchewan	730	90Alberta	4,496	367British Columbia	10,422	898Territories	85	6Outside Canada	1,180	16650,020	5,2434. Number of Orphans,	176. Average monthly	amount,


Mr. Marshall: Are any patients, other than veterans, occupying beds in departmental hospitals and, if so, what is their occupation?
Order Paper Questions


Hon. Daniel J. MacDonald (Minister of Veterans Affairs):: The number of civilian patients treated in departmental institutions in January 1977 encompassing emergency admissions, Workmen's Compensation Board and the Canadian Paraplegic Association patients totals 68. These patients are admitted under authority of Section 24 of the Veterans Treatment Regulations.


Mr. Howie: What is the total cost for (a) educational aids (b) advertising with regard to the 1976 Individual Income Tax Return (i) on television (ii) on radio (iii) in printed publications (iv) by other means (specify)?


Hon. Monique Begin (Minister of National Revenue):: (a)
$31,000; (b) $750,000; (i) $301,000; (ii) $256,000; (iii) $193,000; (iv) Nil.


Ralph Goodale: Mr. Speaker, if questions Nos. 23, 781 and 1,704 could be made orders for return, these returns would be tabled immediately.


Mr. Cossitt: 1.	What was the total amount of salaries paid to the staff of the Prime Minister's Office during the last Fiscal year and what is the total estimated cost for the current Fiscal year?
2.	How many persons have left the employ of the Prime Minister's OfFice since September 30, 1975 and what are their names, job designations and annual salaries?
3.	How many persons have been added to the staff or in any way associated with the Prime Minister's OfFice since September 30, 1975 and what are their names, job designations and annual salaries?
Return tabled.


Mr. Howie: 1.	From January 1, 1976 to October 1, 1976, did the Department of Regional Economic Expansion hire consultants and, if so (a) how many (b) in each case, what was (i) their terms of reference (ii) the time and length of their work assignments (iii) the amount paid to each?
2.	Which, if any, of the consultants' reports are conFidential?
Return tabled.

April 5, 1977
Order Paper Questions LIP-UNEMPLOYMENT IN BRITISH COLUMBIA 
Question No. 1,704-Mr. McKinnon:
By constituency, in the Province of British Columbia under LIP, what was the (a) percentage rate of unemployment used in determining the allocation (b) initial amount allocated to each constituency (c) amount of each secondary allocation?
Return tabled.


Ralph Goodale: 1 ask, Mr. Speaker, that the remaining questions be allowed to stand.


Mr. McKinnon:: Mr. Speaker, I am raising this point with the parliamentary secretary for the second time. I put question No. 1,040 on the order paper on November 10. It is a question about payments that are being made to Lockheed with regard to the long-range aircraft contract. It appears to me that if anyone is watching the cash register, the answer should be simple. Have payments been made, or have they not? We deserve an answer from whoever is making these payments.


Ralph Goodale: I would simply draw to the attention of the hon. member that there are well over 2,000 questions on the order paper and the government tries to give all the answers quick and conscientious attention, and indeed will continue to do that. However, I will take special note of the point the hon. member has just made, to see if I can expedite this particular answer.


Mr. Huntington:: Mr. Speaker, I rise to take exception to the statement of the parliamentary secretary as to the precise, quick and natural way in which the government gives answers to order paper questions. I would draw his attention to question No. 1,860 which has been on the order paper since February 16. Reporters from CBC news staff tell me that the answer has been ready in the department for some weeks now. The answer was given to them, and I have still not received it. Why is it given to outsiders rather than directly to the member asking the question?


Ralph Goodale: I have no knowledge of that matter. I suggest that if the hon. member is interested in the answer to his question, he should ask the minister or the parliamentary secretary involved, and not rely for his information upon outside news sources.


Mr. Munro (Esquimalt-Saanich):: He did ask the minister.


Ralph Goodale: And I am trying to give him his answer.


Mr. Symes:: Mr. Speaker, in a spirit of co-operation I would draw to the attention of the parliamentary secretary my question No. 1,395 placed on the order paper on December 17, 1976. I would very much appreciate it if he would take note of that question and try to expedite the answer.


Mr. McGrath:: Mr. Speaker, I rise on a point of order. Speaking of dispatch in the handling of order paper questions, I would like to draw to the attention of the parliamentary secretary my question No. 812 which has been on the order

paper since October 27 last. It merely asks for details of what is and should be a matter of public record.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration, from Monday, April 4, of the motion of Mr. Macdonald (Rosedale) that this House approves in general the budgetary policy of the government, the amendment thereto of Mr. Stevens and the subamendment of Mr. Saltsman.
Mr. Paul E. McRae (Parliamentary Secretary to Minister of National Health and Welfare):: Mr. Speaker, last evening before ten o'clock 1 was developing the thesis that simply applying a large sum of money to improve consumer demand would not really solve the unemployment problem in this country. I indicated that there had been larger sums on the demand side this year than were included in the budget. They total some $2.4 billion. I put on the record at the end of my speech last night the unemployment figures for the two extremes, namely, Alberta and Newfoundland. I think we should look first at Alberta, the province where there is a boom in business. The unemployment rate in February for males 25 years of age and over stood at 2.9 per cent.
If one considers the largesse of the unemployment insurance funds, the number of Canadians who change addresses each year, which is 700,000, and a series of other factors which relate to the lifestyle of people in this country, one finds that 2.9 per cent is probably below the zero point in terms of actual unemployment. Probably 3 per cent to 3.5 per cent might be taken as the zero point when one considers these factors. Looking at the province of Alberta, we see in the age group 15 to 24 inclusive a rate of 9.1 per cent, a little over three times the rate for males over 25. I suggest that given another set of factors which deal with the lifestyle of young people today, and even the lifestyle of young people in my day, there would always be a substantially higher number of unemployed among this group at any given time than there would be among the male group in the age bracket from 25 up. So one can see that there is very little basic unemployment in Alberta among this age group, perhaps two or three percentage points in all.
Let us look at the other extreme, the province of Newfoundland. There we see, in contrast to 2.9 per cent for males over 25, an unemployment rate of 12 per cent, or a factor of over four. For the group of young people 15 to 24 years old, inclusive, we see 28 per cent, a factor of 2.3. We can go on for the average rates in these provinces. The average rate of unemployed of all ages in Alberta is 4.6 per cent, and the average in Newfoundland is 17 per cent. Again, this is a factor of three to four.
April 5, 1977

The point I want to make is that given these extremes, and given some other extremes that are close to them-I am thinking of the Gaspe and of all the Atlantic provinces, of northeastern Ontario, and so on-I do not think that an infusion of another $2 billion on the consumer demand side would have much effect on these situations. These are structural situations. There is a particularly bad situation in the Atlantic area. We have a bad situation among young people in many parts of the country, but particularly in the Atlantic area.
I want to deal with some suggested solutions later in my speech, but at this point the thesis I want to develop is that the problem is complex, that it is structural, and that it will not be solved by taking simple means such as the broad stroke of infusing $2 billion or $3 billion into the economy. That will not appreciably solve the problem in the Atlantic provinces. 1 reject, in particular, the simplistic claims of the NDP that we should inject more money, which was the basic thrust of their argument. 1 hope that more thought will be given to the structural nature of this problem and specifically to its regional nature with corresponding solutions.
The other point that the NDP makes in many forms is that we should be processing more of our own raw materials, something with which all Canadians would agree. Yet the NDP strongly objects to the notion that we should put more money into business and especially manufacturing or processing our raw materials. They object to allowing the business community more tax concessions, yet business investment is probably the softest spot in our whole economy. In 1973 business investment increased by 14.8 per cent, in 1974 by 7.7 per cent, in 1975 by only 5 per cent, and last year business investment actually declined by 2.9 per cent. Funds have to be made available for investment in the kind of activity the leader of the New Democratic Party talks about.
The opposition of the Tory party is a little more difficult to pin down; it is somewhat harder to define. Perhaps it is not as simplistic. There is certainly a good deal of support for many of the measures taken to further the business community. These measures amount to a little over $1.1 billion, as 1 understand it, and let us not forget that we still have the $2.4 billion going to the demand side. There was some support from the Tories for stimulating consumer demand, and 1 think there has been substantial improvement in that picture, but there seems to be the view that one way or another all this has to be done and yet the government has to cut back its budget.
All the problems we have today are a result of the government spending too much money, according to the Tories. Flow can we do all the things we are asked to do, and at the same time cut back? We did some cutting back, although not as much as the hon. member for York-Simcoe (Mr. Stevens) indicated we should. He suggested we should cut back $1 billion. We cut back in the area of $650 million. 1 suppose what is bothering me about the Tory approach is their concern about our competitive position with the United States. That is
The Budget-Mr. McRae
a legitimate concern, but the Tories seem to insist that at this time, or a short time from now, controls should be removed and that that will in some way improve our competitive position. In this regard I think the Tory party and the NDP find themselves in the same camp.
I would like to discuss controls and to look at what has happened in terms of comparative cost positions. I would like to discuss our competitiveness, specifically in terms of unit labour costs. On the average per year between 1964 and 1974, Canadian unit labour costs rose 3.6 per cent, and over the same period in the United States they rose 2.7 per cent. In 1974-75, in Canada, there was a 13.8 per cent rise, and in the United States the increase was 12.1 per cent. In 1975-76, in Canada, unit labour costs rose 9 per cent in Canada and 4 per cent in the United States. In 1976-77, Canadian unit labour costs rose 7.5 per cent, and in the United States they rose 5 per cent. In Canada, unit labour costs have risen steadily, but they have consistently risen faster than they have in the United States. This has created some very serious problems for our government and our economy.
I feel that the controls should stay for some period of time. On the price side, in 1975 Canada was seventh on the list of 24 OECD countries, and by the fall of 1976 we were in fourth position in terms of reducing or keeping prices down. The countries which were ahead of us were Switzerland, which was number one, Germany, which was number two, and the United States, which was third. That was in October of 1976, and those are the latest figures I have.
Labour's share of net income will give us an idea of what gains have been made. In 1975, labour's share of our net income was 73 per cent. In 1976, it rose to 74.3 per cent. The profits of corporations initially took 14.8 per cent of our net income, but that figure decreased to 13 per cent. 1 think there is some justification for our concern about the business community, and in terms of labour getting its share I think we should keep the controls.
I would like to wrap up my remarks by indicating that I am concerned because the debate in this House has been of a simplistic nature. We are not looking carefully enough at the ingredients which make up our economy; we are not analysing them. In the two or three minutes which are left, I would like to make some suggestions. I feel an effort was begun in this budget-and I think we have to extend that effort-to regionalize the federal government. I was very pleased by the relatively small-but significant in terms of our future- change in fiscal policy. We have said that the 5 per cent investment tax credit will be extended to the whole country, but that in areas of northern Ontario, Manitoba and Saskatchewan it will rise to 7.5 per cent, and in the Atlantic provinces, where problems really exist, this credit will rise to 10 per cent. That is a beginning. I believe it is a first. It certainly is a first as far as my memory is concerned. It is the very beginning of a fiscal policy which has a regional base. It is an extremely important start. I think that following up that start cannot be left just to DREE. DREE is doing a Fine job, but it cannot do the job alone.

April 5, 1977
The Budget-Mr. Clark
I think our efforts must be multidepartmental. I suggest that perhaps there should be more fiscal measures. I suggest that perhaps more should be put into direct job creation. Our transportation system is very much involved in our development.
Mr. Speaker, 1 just need one more minute.


The Acting Speaker (Mr. Ethier):: The hon. parliamentary secretary can continue with unanimous consent. Does he have unanimous consent?


Some hon. Members:: Agreed.


Paul Edmund McRae: I suggest that transportation will play an important role in developing our regions. There are many other departments which could become involved. For instance, some months back we were talking about the "Orion." About $500 million worth of work was to be created in Canada, but at that time nobody thought about creating that work outside the centres of the two cities involved, and creating it in regions where problems exist. In everything we do we should be conscious of the fact that these regions, which might be called undernourished, must be taken care of.
I suggest that we might also look at the possibility of separate monetary policies for some of these regions. This is very tricky and is something that one has to look at carefully, but it is a possibility. 1 am suggesting over-all that we not turn the country back to the provinces but, rather, that we learn how to develop regional economies under the federal system.
In conclusion, Mr. Speaker, I should like to state that I hope the debate will deal more basically with the problems rather than taking the broad stroke; that there will be more imagination, particularly when we are thinking of regionalization, and that there will be a kind of getting away from the "we", "they" position that we have where "we" on the labour side say "they" should not have it, or "we" on the corporate side say "they"-labour-should not have it. At this crucial point, when problems are so interdependent and so complex, there is a much greater need for understanding among all sectors of Canadian society.


Mr. Joe Clark (Leader of the Opposition):: Mr. Speaker, last Thursday night, in the budget speech, the government missed its last chance. We now know that this government is unable to provide the country with the leadership it needs and that it rallies politicians who can give stage performances in Washington but cannot govern Canada. Even at this late stage, the budget could have met three objectives. It could have created jobs for the thousands of Canadians who are looking for one, particularly among young people and in the eastern provinces.
It could have put money into the pockets of low-income Canadians to lighten their tax burden and stimulate the demand for Canadian products. Finally it could have restored an atmosphere of confidence in the Canadian economy, par-

ticularly among investors. But since last Thursday night, we are even a little farther from those objectives. The opportunity went by. Nobody grabbed it.

Mr. Speaker, this government opposite, which has been running the affairs of this nation for the last nine years, has very much to answer for. Its most dramatic failure has been its failure to bring Canadians together-


Some hon. Members:: Hear, hear!


Charles Joseph Clark: -its failure to unite Canada. This government came to office in the year of Expo, the year of centennial when the spirit of unity in this country was never higher. Now, it has never been lower after nine years of the government's administration. At least in this area of attempting to unite the country the government had an approach; it had a policy; it seemed to know what it wanted to do, but in the area of economics there has been no pattern, no policy, no consistent objectives.


John Allen Fraser: No leadership.


Charles Joseph Clark: There have been no results except the results that are felt by the more than one million Canadians who are out of work now. In making policy, we have endured under this government a decade of drift. There was an opportunity for the minister to change that and to bring some direction to economic policy in this country on budget night last week. The government refused absolutely to respond to the challenge of bringing leadership to Canada.
Mr. Speaker, one of the most outstanding features of this government is the energy it devotes to spreading the blame to others and fixing on others blame for its own failures.


An hon. Member:: It is always somebody else.


Charles Joseph Clark: It is always somebody else, as one of my colleagues says. This budget is very much in the tradition of blame-fixing; it is a blame-fixing budget; it is an attempt to find scapegoats. The Minister of Finance (Mr. Macdonald) attributes the decline in activity in equity investment markets to "such unsettling factors as the world recession, oil price increases, inflation and poor corporate earnings." When we look for unsettling factors, we need look no further than across the floor of this House of Commons.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: The main unsettling factor in the economy of Canada is this indecisive, drifting, insensitive government itself. Again, sir, the minister attributes the unemployment situation in Canada to "rapid growth and changes in the structure" of the Canadian labour force, as if this were a sudden volcanic eruption unforeseeable by mere mortals, yet both the increase of young people seeking jobs and the increase of women seeking jobs has been forecast for years by the government's own statisticians. The arrival of a new generation of jobless-the Big Mac generation-has been known and expected for at least 15 years, and in each and every year of
April 5, 1977

the last decade the participation rate of adult women in the labour force has trended upward by a predictable, foreseeable 1 per cent per year. The situation has been foreseeable for anyone who cared to look-indeed, for anyone who cared at all about Canada. Yet the plain fact is-as illustrated again by the budget brought down last Thursday night-that this government does not care about anything except about its own month to month survival. I simply say that the new attempt to fix the blame somewhere else is not going to work this time because the day is coming when the people of Canada will put the blame for political disunity and economic stagnation right where it belongs-squarely at the top, with the political leadership of this nation.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Mr. Speaker, the hon. member for Oshawa-Whitby (Mr. Broadbent), who is out of the House for the time being, has outside this House called this budget a Tory budget. Sir, would that it were. 1 wish that the socialist leader was, on this occasion, and for once, in touch with reality. In fact, if the parentage of this budget lies anywhere other than with this government, it rests with the New Democratic Party and with those heady days from 1972 to 1974-those days when the NDP came as close to power as they ever will; those days when this government was so ready to mortgage the country's future to buy the support of the NDP.


Some hon. Members:: Hear, hear!


Some hon. Members:: Shame.


Charles Joseph Clark: If this were a Tory budget, as the leader of the New Democratic Party suggests, it would be a far more effective document than the one brought down last Thursday night.


An hon. Member:: Right on.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: As my colleague, the hon. member for York-Simcoe (Mr. Stevens), indicated yesterday, it would have included real and generous tax cuts for lower income earners, not just the scraps from Big Mac's table.


An hon. Member:: Shame on you, Mac.


Charles Joseph Clark: It would have included selected reductions in the manufacturers' sales tax as a measure to reduce the cost of living for ordinary Canadians. It would have included stronger steps in support of small business.
Today we saw the minister responsible for small business standing up and boasting about the high rate of failure of businesses under the Liberal administration. Their advice to students seeking jobs is to leave the country. Their advice to small businessmen is, if they stay in the country under a Liberal government, they can be sure to fail. Sir, a Conserva-
The Budget-Mr. Clark
tive budget would have included, in order to bring jobs and investment to the disadvantaged regions of Canada, stronger measures such as long-term tax contracts for firms prepared to invest in those regions.
These are all positions which my colleagues and I have been outlining in this House and elsewhere in the country, hoping that the Minister of Finance would take cognizance of the proposals we have offered and of the seriousness with which this country regards the economic stagnation which is the legacy of the decade of drift under the present Liberal government.
Above all, a budget prepared by our party would have restored a sense of confidence, direction and purpose to the economy of Canada. It is of some note that this government has finally seen the need to encourage new investment in Canada, has finally seen the linkage between investment, jobs and growth. But what has been gained on that side has been more than lost, again, by the minister's continuing confusion about controls. The minister asserts baldly that the controls program "has helped to bring down the rate of inflation." Yet there is little evidence for that assertion. It is true that the rate of increase in consumer prices in Canada is less than it once was. But it is also true that in most parts of the industrialized world it is less than it once was. In fact, consumer prices are still rising faster in Canada, with controls, than they are in the United States without controls.
Sir, to accept without criticism the minister's assertions about the role of controls is to commit a primitive, logical fallacy. We can expect primitive actions from this government, but one might think that it would be good at arid logic. The line of the minister, in effect, is that rain follows the rain-dance; one causes the other. The minister, who is all too ready to believe in mysterious outside forces when it suits him-for example, when it comes to unemployment-would have us forget altogether about outside forces when it comes to assessing the value of his economic program, particularly the program of controls. The truth is that the main value of controls lies in the time they can buy the government in order to put into place real and lasting solutions. That is the essence of the matter which the government still does not understand. That was the essence of the economic stabilization program proposed by this party and attacked so vigorously by the government opposite in the 1974 election campaign.


Mr. Paproski:: They are dishonest.


Ramon John Hnatyshyn: They said that our party would freeze wages.


Arthur Jacob (Jake) Epp: Zap! You are frozen.


Charles Joseph Clark: Mr. Speaker, I am pausing for a moment to allow my colleagues to bring to the attention of hon. members opposite some "commercial" breaks-"Zap!" They remember.


Mr. Stanfield:: They are much too busy to listen.


Arthur Jacob (Jake) Epp: Yes, they are devising another budget.

April 5, 1977
The Budget-Mr. Clark


Charles Joseph Clark: Even though the main purpose of a controls program is to buy time with which to put other reforms into place, this government has wasted that one asset, wasted those precious 18 months of time. Indeed, this government specializes in waste. It wastes the people's assets. It wastes the people's money. It wastes the people's time.


An hon. Member:: It wastes people.


Charles Joseph Clark: And it wastes people, as my colleague says. When controls were introduced we were promised a comprehensive energy policy for Canada, yet 17 months later we still have no comprehensive energy policy for Canada.


John Allen Fraser: We do not even have a comprehensive promise.


Charles Joseph Clark: Mr. Speaker, my colleague said we do not have a comprehensive promise. Seventeen months ago we were promised a housing policy. Today there is no co-ordinated housing policy. Seventeen months ago we were promised that the government would examine the impact of regulatory practices on economic performance and efficiency. Yet we have seen no evidence at all that such an examination has been carried out. The government has wasted the time it bought.
As 1 have said on previous occasions, what Canadians demanded above all else from this budget was a sense of reassurance. They needed some sense of certainty on which they could make plans and from which they could draw some sense of confidence. They wanted to be told where this government was heading in terms of its basic economic policy so that individual Canadians, the decision-makers across this country who make this economy tick, could decide where to head with some sense of certainty and assurance.
Instead, on the central issue of the current controls regime, this minister's performance was nothing short of ludicrous. He started out by saying flatly that the job of controls was "not yet done"-and, indeed, his budget document restated the expiry date of December 31, 1978. But then he told us that there was-and I quote him-"a particular need to consider a possible date for beginning the decontrol process." There we had something specific. He mentioned the need to consider a possible date for beginning. And what is that date, Mr. Speaker? Well, the minister is not quite sure. He said, again, and 1 quote him, that it would be "neither feasible or desirable" to begin that process before October 14. But wait a minute. There is this question of voluntary restraint. If there is any progress there-and the minister does not bother to tell us or the other partners in the economy what he regards as progress-it may be that he will consider an earlier date. But he is telling everyone to proceed, as he puts it, "in the expectation that controls will continue in effect for some time." So we have a government that is on every side of the question as to when, whether, or how controls will terminate.
Instead of that confusion, this country needed certainty and reassurance. But what we got from the minister was confusion and mumbo-jumbo. Compared with that performance, Mr. King's famous phrase about conscription is clear and unequivocal.
[Mr. Epp.J
The tragedy, sir, is not how foolish this minister and this government look. We and the country are well used to the government and the minister looking foolish. The tragedy is that by refusing to give Canadians any clear sense of direction on this essential question, the minister probably has undone any stimulative effect he might have obtained from the various investment incentives he offered in his budget. With one hand he offers Canadians tax benefits for new investment and expansion in the economy, but with the other he maintains and even increases the very climate of uncertainty which has already done so much damage to our prospects and potential for growth. This government, to borrow a phrase, already has wrestled investment to the ground. The minister on Thursday night simply threw it for another fall.
Sir, the budget calls for a deficit of almost $7 billion. It is, as my colleague for York-Simcoe said yesterday, a deficit larger than the entire federal budget when the right hon. member for Prince Albert (Mr. Diefenbaker) led the government of Canada. It is a deficit which adds almost $800 to the burden of national debt carried by every working Canadian.
Yet, sir, not only is it a large deficit; it is a do-nothing deficit. It adds flab, not muscle, to our economy. It is not the result of any conscious government decision to stimulate the economy and put people to work. Deficits can be justified if they create jobs, but the only jobs this deficit will provide are for the people who operate the printing presses for the Bank of Canada.
What this deficit represents is this year's cost to Canadians of the past extravagance and the continuing irresponsibility of the government. What it shows us with such frightening clarity is the extent to which this government's wild spending habits during the past nine years have come home to roost. This government has so overextended itself and so overextended the resources of Canadians that even when it stands still its accounts fall deeper into the hole. In short, this budget deficit has nothing to do with the economic theories of John Maynard Keynes. It has everything to do with the economic irresponsibility of John Napier Turner.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Given the minister's debt to his predecessors, it is useful to observe that neither of his two predecessors chose, after serving in the finance portfolio, to seek re-election to the House of Commons. The electors of Kingston and the Islands, and the electors of Ottawa-Carleton, now are represented by Progressive Conservatives. We have to ask if the electors of Rosedale can be far behind.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: A budget prepared by this party would, as I say, have restored a sense of confidence and direction to the Canadian economy, not merely because there are better ideas on this side of the House-and that is obvious-but because we in this party know the basic economic goals that we would
April 5, 1977

set for Canada. Our government would reaffirm unequivocally that it is the private sector which is the main source of new jobs and new wealth in this country.


Some hon. Members:: Elear, hear!


Charles Joseph Clark: Our government would recognize its responsibility to establish a climate of certainty so that the private sector could get on with the job of building the country. Government has a right and a responsibility to establish the rules within which the economy operates, but it has an obligation, also, to ensure that those rules are fair and precise and that they are not subject to change in the middle of the night, as has been the case too often with this government.
Our government would establish a tax system which encourages Canadians to channel their savings, now among the world's highest on a per capita basis, toward new investment in this country. Our government would give the private sector room to grow by reducing its own demands upon our productive citizens.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: As my colleague, the hon. member for York-Simcoe, pointed out yesterday, 20 cents of every dollar earned by Canadians is claimed by personal income taxes, compared with just 14 cents in the United States. A Conservative government would be committed to reducing that load on the individual Canadian taxpayer. Finally, our government would take the lead in strengthening Canada's competitive position in the world, not merely as a passing, budgetary gimmick but in the long-term interests of this nation.
I want to speak for a moment about the grim statistics of unemployment in this country. I suppose the budget was merely an elaboration of the definitive statement of government policy on unemployment that was offered to students at the University of Toronto the other day by the Prime Minister (Mr. Trudeau) when he said, "If you want a job, leave this country."

The problem of unemployment is particularly acute in the province of Quebec and in the four Atlantic provinces. Last February, Quebec alone accounted for almost a third of the total number of unemployed. It is obvious that those men and women found no comfort in that budget and certainly no hope. But unemployment is not just a statistical issue, it is a social problem resulting in all kinds of human tragedies. Unlike the government members, we are very concerned by this problem.
The general impression given by this government is this: we have no reason to be overly concerned about unemployment because the unemployed can claim unemployment insurance or, at worst, live on welfare. Mr. Speaker, I am absolutely against such an attitude as it is completely indefensible. Such a cynical and pessimistic position does not have its place in Canadian society. Such a reasoning ignores a basic value, that of human dignity. It also forces upon society a cost in human monetary resources that it is not supposed to assume. Further-
The Budget-Mr. Clark
more, it is surely not on such a basis that we shall build our country and achieve all its potential.

It is essential, if we are going to build in this country and if we are going to realize the potential we possess, that we create among the new generation of Canadians, the young who are now coming into the work force and looking for work, some sense, not just of the greatness of this country but of the possibility for each of them to find some way in which he or she can contribute to the building of this country.
We hear a lot of talk these days about the attitudes of our young people. Some question their commitment to the work ethic, although, as I have said before, the work ethic requires having some work to be ethical about. The Prime Minister questions the expectations of the young. He suggests that young Canadians have no right to believe that Canada owes them a job opportunity and a future. Others worry about the cynicism of the young, especially their lack of respect for and belief in our political institutions.
I invite hon. members to look at this budget from the point of view of a young Canadian, and ask themselves what this budget and what this government offers a young Canadian other than cynicism and disbelief. This is a budget that tells young Canadians baldly, without apology or compassion, that this government is not prepared to deal with unemployment. If that were not enough, it is a budget which adds several more billion dollars to the legacy of waste and extravagance for which the next generation ultimately will have to pay.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: With a government like this and a budget like that produced on Thursday night, it is no wonder that we have a generation which is being schooled in cynicism and hopelessness? This dismal budget begs any number of questions, but no question is more fundamental than the simple one: Why, given the very real problems facing the Canadian economy, would the minister choose to give us a budget that addresses none of these problems? Why, given the current need for some sense of certainty and reassurance, would the minister offer the country only new confusion and new uncertainty? Perhaps the most direct and, indeed, kindest explanation is that this government is simply too incompetent to deal with the country's problems. There is no lack of evidence that this government has long since run out of any steam that it ever had.
Another possible explanation is that this government in fact has a very limited view of what this country can achieve, a very limited view of the possibilities of Canada. It does not seek to achieve our growth potential as a country because it does not really think we have any. It really is not seized with the problem of one million unemployed Canadians-with more coming, thanks to this budget-because it accepts unemployment as a norm for Canada. Besides, do we not have a generous unemployment insurance program in this country? This kind of reasoning can cause us to lose forever the chance

April 5, 1977
The Budget-Mr. Lessard
to achieve the potential of this country. If that, indeed, is the view of this government-and there are plenty of musings from the Prime Minister to suggest that it is-then, bluntly, this government is simply not worthy of this country. This country, with all its potential, deserves much more than a government whose highest ambition is to stand still. The people of Canada deserve better than a government which sees the Canadian dream as being two parts unemployment insurance and one part welfare.
There is a third possible explanation for this budget, Mr. Speaker, one so cynical that I would not attribute it to any government but this one. It is that the minister's budget decisions were made on the basis, not of Canada's economic needs but of the Liberal party's electoral strategy. If there is to be no election in 1977, then why waste any effective action this yeaf? Next year is when the government needs the "goodies". So one million Canadians will just have to wait until Keith Davey gives them the green light.
As I say, Mr. Speaker, I would not even suggest such a cynical approach by any government other than this one. But I look back at this government's economic policies and I ask myself whether they have ever had any basis other than sheer political opportunism. In 1968, in that famous election campaign, the Prime Minister went around the country-this should be remembered in light of his record-telling Canadians that it was time to "end the free stuff'. That from the right hon. member for Mount Royal! Then he went on the wildest spending binge in Canadian history.
In 1974 the Liberal campaign strategy-their "promise for tomorrow"-was to point out of television sets at Canadians and say, "Zap, you're frozen", and then to introduce the very controls regime that they had attacked. Canadians, looking at that record, will ask themselves whether this government is not capable of putting aside the needs of Canada if they do not happen to fit in with the plans of the Liberal party. I will let this House and the country decide which of those explanations best fits this unworthy government. Canadians can decide whether this government is simply incompetent, whether it has no faith in Canada, or whether it is just too cynical to care. Canadians can make that choice, Mr. Speaker, for these questions all lead to the same conclusion. There is simply no justification for this government to remain in office, and the sooner Canadians get their right to change that, then the better for all of us.


Hon. Marcel Lessard (Minister of Regional Economic Expansion):: Mr. Speaker, I should like-


Mr. Grafftey:: Are you ready to resign?


Marcel Lessard: The hon. member across the way asks if I am ready to resign. He will probably have to wait a good long while for me to do that. Chances are I shall be here in the House for a long time to come while he probably will not.
Mr. Speaker, I listened very closely to the remarks of the Leader of the Opposition (Mr. Clark). I was hoping that, after

leading his party for a year, he would have fare more interesting solutions to suggest than those we heard. Of all he said, which I followed closely, I found it hard to remember more than three or four points that may have some value, which could possibly be analysed had he given us more details. But, as always, the Leader of the Opposition abstained from giving us details of what his party could really offer. He limited himself to great general statements.
For the so-called disadvantaged areas of the country, he said, he would have a huge program of decentralization and he of course would resort to incentive measures to help investments in those areas. It is all very well, Mr. Speaker, to make such statements; it is a very easy solution. We do that too, we have done so. We often hear, publicly, men who are not necessarily active in politics, make such statements. But there is a huge difference between declarations of principle and concrete action, and detailed proposals; there is a huge difference, because it is always more difficult when time comes to do exactly what one has said one would do. I should like to point out to the Leader of the Opposition that, last fall, when he spoke to students in the Maritimes, and in New Brunswick in particular, he dared say that one of the prime concerns of a Progressive Conservative government with regard to the Atlantic provinces would be to decentralize the Department of Regional Economic Expansion.
He did not even know then that the Department of Regional Economic Expansion had already been decentralized for more than two years. He said in one of his last comments that a Tory government would promote the investment of the large savings made by the Canadian people. Indeed he insisted on the fact that those savings were highest among industrialized countries. Why, Mr. Speaker, do Canadians have such large savings? It is precisely because the government during the past few years has taken steps to encourage Canadians to save and invest in the development of their country. The budget tabled last Thursday by my colleague suggests other formulas to encourage Canadians to invest more of their savings in the development of industry.
Mr. Speaker, I am quite pleased to take part this afternoon in the debate on the budget speech. I am proud to do so as a Canadian and a Quebecer from the Lac-Saint-Jean area. Any thorough consideration of the Canadian economic conditions and prospects brings us to the conclusion that the success has been mitigated and that the future is uncertain if the present trends are maintained. The budget put forward last Thursday by my colleague the Minister of Finance (Mr. Macdonald) clearly indicates the way to a greater prosperity. The Canadian economy has the following challenge to offer: as citizens we should rely more on our own resources than on the government to improve our individual conditions. By doing otherwise we would lead the existing welfare programs to bankruptcy. As workers, we should expect long term wage increases only when we can increase our productivity. By doing otherwise, Mr. Speaker, we would force companies to close down and we would lose our jobs.
April 5, 1977

As managers, Mr. Speaker, we should reinvest more money in our business and become more competitive internationally through better decisions and a more efficient marketing policy for our products. As groups of manufacturers, Mr. Speaker, we should limit our dependence on tariffs which are too often used only to conceal our lack of innovation, and we should increase our efforts in research and development.
Mr. Speaker by doing otherwise, we would impair our conviction that free enterprise prevails in our economy. As a government, we should account each year for our programs both as far as their efficiency and as their implementation are concerned. By doing otherwise, we would keep implementing obsolete programs and provide inadequate services.

The government remains convinced that the proper longterm policy for economic growth in this country is to regain our competitive position internationally by ensuring that inflation is controlled and increased productivity is encouraged. This will lead to more jobs and more exports. This will lead to an increased capital investment. At the same time, the federal government is committed to continuing restraint in its own growth and spending policies. By controlling its own spending, the federal government sets an example to the other levels of government that they, too, should control their growth instead of depending on increased transfer payments from Ottawa.
By limiting our spending policies we are leading Canadians to the conclusion that in the final analysis the country relies on them and their efforts. To get the economy moving again we will have to bring high inflation and its accompanying psychology under strict control. We can, then, bring wage settlements in line and control our unit labour costs, thus improving our international competitive rating position. As productivity increases, the real income of Canadians will rise accordingly. Private sector decisions to invest will lead to less government spending and decreasing demands on social programs.

Mr. Speaker, I am proud to say that the federal government's budget takes into consideration the problems mentioned and the alternatives proposed and brings forward appropriate solutions.
My colleague, the Minister of Finance (Mr. Macdonald), stated, and 1 quote:
Our first objective must be to maintain the underlying trend to lower inflation.
Our second objective must be to encourage a steady and non-infiationary growth in the economy, in order to provide jobs and reduce unemployment.
I want to emphasize that the federal government recognizes and accepts its responsibility for action to help achieve these goals. But responsibility for the economy rests on others as well. Both political and economic power are widely dispersed in this country, reflecting Canada's diversities and protecting our fundamental liberties. All those who share power also share the responsibility that goes with it for the attainment of our economic goals.
Mr. Speaker, the measures proposed in the budget speech will certainly create employment, foster investments and favour regional development. They will improve the stock market as well as the liquid assets of companies, thereby
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making funds available for expansion. They will also provide increased assistance to small and medium size business.


An hon. Member:: Hear, hear! That is what a real government is, Marcel, a real one-


Marcel Lessard: Moreover, let us consider for a moment the direct creation of employment in certain areas where unemployment is very high; let us think of the incentives to increase investments, including the self-financing of firms to compensate for the stagnation of benefits and the distortions resulting from inflation; let us think of the encouragements to small business, the lightening of the burden of the Canadian taxpayer, especially those whose revenues are affected most by inflation. There is, however, in the budget speech an item which interests me in the highest degree, Mr. Speaker, namely the extension for an additional three years, that is, up to July 1, 1980, of the investment tax credit program.
As a complement, its rate is increased to lxh per cent for the areas designated by our department, that is Saskatchewan, Manitoba, northern Ontario and Quebec, except for the Mont-real-Hull corridor and the Gaspe peninsula. For the Gaspe peninsula and the Atlantic provinces, the rate has been increased to 10 per cent. That means that a company located in the Atlantic area will be able to deduct from its federal income tax the equivalent of 10 per cent of its new investment. Thus, a company with $100,000 investment could deduct $5,000 before. Now it will be able to deduct $10,000.
Money is important, but it will never be as important as the concept itself. For the First time, a fiscal tool will be used to fight against regional disparities. This is a first step and cause for rejoicing. Why should it not be the same with personal income tax? Why should it not be the same with other measures likely to convince people, for example, to remain in the Atlantic area?
And I would even go further, Mr. Speaker, why would it not be possible to help Canadians who were born in the Atlantic provinces, who were educated there and who, because of a lack of jobs, moved to central Canada where they took up a career in business, industry or other fields? Why not provide an incentive to allow those people who in many cases retire before time, that is before they are 65, to go back to their region and give the local small businesses and people the benefits of their business experience in central Canada?
I think, Mr. Speaker, we could find some formula that would prompt these citizens to go back to their native areas and make their experience benefit their younger fellow-citizens and organisations. That is a suggestion 1 am now making. This is the first time I do so publicly and I am quite prepared, now that the Minister of Finance has already listened to me, to continue pressuring him so he will again listen to the recommendations I might put forward on other occasions.
As 1 was saying, Mr. Speaker, it is the first time that the Canadian tax system recognizes there are differences between the various parts of the country. The new tax credit providing for three various rates is to give an additional incentive to investment in those areas where the economic recovery is the

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slowest and the unemployment rate the highest. The tax credit applicable to other areas of Canada remains at 5 per cent. This 5 per cent tax credit was set up in 1975 and turned out to be, as my colleague the Minister of Finance pointed out, a significant incentive for our manufacturing and processing industries. I would like to commend him for extending it for another three years and applying different rates in various regions. It is something which will be quite welcome by isolated areas.
Of course, as evidenced by its creation, the Department of Regional Economic Expansion had long recognized the existence of those disparities. It recognized them when it applied its politics because consideration is being given to those regional differences in our policy, for instance in the agreements we are currently negotiating and concluding with the provincial governments. Cost-sharing arrangements resulting from their application vary from one province to another. Those arrangements go from a 50-50 per cent basis in some provinces such as Ontario, Alberta and British Columbia to a 40 per cent provincial and 60 per cent federal in provinces such as Quebec, Saskatchewan and Manitoba. And in the case of the Atlantic provinces, as far as 90 per cent of the expenses incurred are paid by the federal government. That is a genuine and factual recognition, Mr. Speaker, and not mere words, not promises but precise facts which can be verified every day.
As member for Lac-Saint-Jean and minister of the Crown- and as Minister of Regional Economic Expansion-and in the name of my department, I undertake personally to take up the challenge contained in the budget and follow up its objectives through our programs and initiatives.
In my estimation, my Department of Regional Economic Expansion is perhaps the one federal department best suited for the implementation of the budget's philosophies of employment creation, business investment incentives and development of regional growth.
In the past three years, since the beginning of the general development agreement mechanism between my department and the provincial governments, nearly 70 subsidiary agreements have been signed, more than 20 of them in the fiscal year just ended. Several of these new agreements were co-signed with me by the federal Minister of Transport (Mr. Lang), the Minister of Manpower and Immigration (Mr. Cullen), and the Minister of Indian Affairs and Northern Development (Mr. Allmand). These action pacts raise to well over $2 billion the total committed to regional development initiatives through these subagreements, including an industrial park in Wabush, Newfoundland; community infrastructures in Happy Valley, Goose Bay, Labrador; agricultural development in Nova Scotia; an examination of potential major coal development in British Columbia; and land and air transportation improvements in northern Alberta, to name but a few.
With even this briefest of summaries, Mr. Speaker, it is clear that DREE's scope for correcting regional disparities is national and that we are effective both in direct industrial
development and in joint consultation and program development between the federal and the provincial governments. In everything we do, we actively foster regional growth. We support small business creation and expansion. We assist farmers and fishermen and foresters. In conjunction with provincial governments we plan rural development strategies and we have a direct effect on regional industrial development strategies. At all stages we are generating new employment opportunities and ensuring decent job alternatives to citizens in rural or slow-growth areas.

Mr. Speaker, I would like to say a few words about the business incentive program. As we all know, the Regional Development Incentives Act has now become a well established program. Companies from all parts of Canada have received grants which amount to more than $580 million. This should lead to some 127,500 new jobs in slow growth areas.
I wish to draw the attention of hon. members to the fact that the success rate of companies which have received grants is about 90 per cent. Furthermore the application of this program has been constantly improved to meet the requirements of industry. For example, the delay required for analyzing applications for grants has been reduced by 25 per cent since 1974. When the decision is taken at the regional level, which is the case for more than 80 per cent of the applications received by the department, the delay required to consider the application and to come to a decision has been reduced by 33 per cent. [English]
All across Canada the year ahead promises to be difficult and exacting, politically and economically. 1 pledge my department to continued consultation with every provincial government to identify and resolve regional problems.


Some hon. Members:: Hear, hear!


Marcel Lessard: In keeping with our effort to bring government services closer to the people who use them, I will soon be announcing new offices in regional centres to service development needs. To meet inordinately high unemployment levels in major industrial centres I will pursue new concepts in priority industrial development programs. I and my department will continue to extend our programs and services to the status and non-status native people in co-operation with the provincial governments.
In British Columbia the central economic problem is the province's reliance on a single resource-based industry. When, as now, that industry suffers in a world market slump, the whole province suffers. My department is currently involved, along with other federal departments and the provincial government, in a thorough examination of industrial development alternatives for British Columbia, both in primary resources and in secondary manufacturing. We hope to help create long-term jobs in British Columbia that will not be threatened by slack world markets in any single industry.
In the prairie provinces the central problems facing Canadians are a potentially severe water shortage and a chronic lack

April 5, 1977

of a mature industrial base. My department, through the PFRA, will continue to develop water drainage systems and other flood control systems to better conserve water holdings. With both the subagreements and the RD1A program we will work together with the provincial governments and community groups to develop that much-needed industrial base.
In Ontario, easily the most industrialized and most populous province, serious regional disparity continues unchecked. My department will provide continuing RDIA and subagreement incentives to rural or regionally based Ontario citizens with particular focus on the rural and small town communities in eastern Ontario. In the Atlantic provinces the challenge is twofold. We must strive to narrow the gap between the region and the more affluent central core, and at the same time give high priority to closing the gap between the metropolitan areas and the more rural areas within the Atlantic region. Under the special areas programs the metropolitan economies were greatly strengthened. In recent years DREE has increasingly shifted its priorities toward the non-urban areas. This is a trend which will continue.
Our spending in the Atlantic region more and more favours the non-urban areas, as the following figures will illustrate. Under the GDA program and the P.E.I. development plan we have committed the following to rural areas: 76 per cent of our spending in Newfoundland; 78 per cent of our spending in New Brunswick; 45 per cent of our spending in Nova Scotia- and this does not include DEVCO spending: all budget expenditures take place in one area of the province-and 92 per cent of our spending in Prince Edward Island goes to the rural part of the province.
In short, almost 75 per cent of our Atlantic commitments are in non-urban parts of the region. To be sure we will not want to endanger the economies of the Atlantic metropolitan areas. We must be, and are, however, committed as a department to close the income gap within provinces as well as between provinces.

Mr. Speaker, I would like to deal briefly with the present situation in Quebec. As I said to the Montreal Chamber of Commerce last Tuesday, we intend intensifying our activity in the Montreal area while working closely with local administrations. Montreal is presently going through a difficult period. In recent months, the rate of unemployment has risen rapidly to a high of 9.2 per cent in February, while it was only 6.8 per cent in the greater Toronto area, 8.3 per cent in Halifax, 4.8 per cent in Regina and 3.5 per cent in Edmonton.
In view of the fact that almost half of unemployed Quebecers are in the greater Montreal area, that the economic development of Quebec must come out of the revitalizing of the Montreal growth rate, that the Quebec economy is handicapped by the current structural decline of Montreal, that such a decline results from a gradual weakening of the relative situation of Montreal in certain key areas such as transportation and financial activities which are traditionally at the very base of the development of that area, it is obvious that we shall have to intervene to remedy the current situation. How will the
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government finally choose to do so? We do not know that in full details as yet, Mr. Speaker. Nevertheless, as officials of DREE, we shall go on negotiating subagreements under the General Development Agreement signed with Quebec.

In summary, I accept on my own behalf and on behalf of my department the three budgetary challenges of employment creation, investment encouragement and regional development. As Minister of Regional Economic Expansion, I will strive to achieve a better balance in Canada's economic growth so that rural or small town Canadians will not be forced, through lack of meaningful employment opportunities in their home regions, to move to already overcrowded urban areas, occasionally with high levels of unemployment. In many cases, my department will work closely together with other federal departments, provincial governments and the private sector to take advantage of regional development opportunities. [Translation]
Mr. Speaker, the coming year is going to be very demanding, politically and economically. And to accept the challenge of encouraging our national unity by an increased understanding of the regional problems and of the solutions which will have to be found, not one federal department is better equipped than the DREE.
The Minister of Finance said in his speech, and I quote:
with a market economy and within a federal State government, responsibility for the economy does not rest only on the federal government. It rests on all Canadians. Both political and economic power are widely dispersed in this country, reflecting Canada's diversities, and protecting our fundamental liberties. All those who share power also share the responsbility that goes with it.
I repeat this, Mr. Speaker, as it is a very important statement. It answers as well some of the critics who would consider the government as the sole body responsible for the economic problems which face the country today and confront unfortunately too many jobless Canadians.
But the responsibility does not rest only on the Canadian government. We all share these responsibilities: the provincial governments, the population at large and the private sector are all responsible for this situation, up to a certain point. This has never been so true, especially within the present political context in Canada and particularly in Quebec.
For instance, we see advertisements inviting industrialists to leave Quebec. Those people bear on their shoulders the future of our country and I hope they are conscious of what they are doing. To those people I would like to recall the frustration which people from the Atlantic area are living with or have lived with for many years, the frustration that Quebecers experience, as do all the people living in isolated areas. That could be ascribable to the carelessness of the governments, but especially to the business community which is more interested in immediate profits and much less in the general well being of the population. Industry still has to find a social conscience.
Too often business and industry forget that if Canada falls apart, their profits will also disappear and if they concentrate

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their investments too much in the centre of the country or in large cities, they work against national unity and consequently they work against their own long term interests.
Current economic development often operates to the detriment of the Atlantic and Quebec areas and northern parts of all provinces.
I think that if industry, businessmen, really have the interest of this country at heart, if they believe that its interest is their interest, if they want this country to continue to exist and progress they will have to understand that the basic condition is that they reconsider their approach to investment. If industry separates the Canadian economy from the Quebec economy, the only thing left for Quebecers to do will be to achieve political independence, and that would be a situation that I would regret deeply. This message is fundamental and I feel strongly about it and I am glad that the budget speech deals with it.
My colleague, the Minister of Finance, said in this way the private sector also has some power and responsibility. In our market economy private business takes most investment decisions and looks for new outlets in and outside Canada in competition with one another and with foreign suppliers. The private sector basically develops the new resources and new techniques that allow us to maintain and improve the standard of living. Governments can, of course, provide assistance and incentives but experience proves that we are better off leaving those decisions to the private sector. Efforts by private business, its judgement and faith in the future are indispensable to economic progress. More then ever it is time for unity among all members of this Canadian society. It is not by being jealous of one another that we will come out of the difficult period we are now going through.
Finally, Mr. Speaker, I would like to conclude on a final note that once again has to do with national unity but about which I feel very strongly. In the nearly 15 years that I have been in politics as a member of parliament, and now as a minister, I have had, of course, the opportunity to tour my country several times. I have been hoping for a long time that all my fellow citizens, particularly young people, should have the opportunity to see our country.
I am happy to see that we have several programs that allow young people to travel and know their country better. I would hope that it would be possible for older people also to use our means of communications, such as railways, to allow a greater number of Canadians to know their country better so they will love it even more and be better prepared to protect it and keep it together. The freedom to travel from the Atlantic to the Pacific without having to show a passport, the capacity to have a country that goes from the Atlantic to the Pacific and the possibility of moving from one province to another to either get treated, study, or work, all of that, Mr. Speaker, are not elements that can be accounted for. That appears nowhere in the liabilities or assets of the national accounts of both Canada and Quebec, and yet, Mr. Speaker, those benefits are real but unfortunately there is too often a tendency to forget about them.


Mr. David Orlikow (Winnipeg North):: Mr. Speaker, this country has more people unemployed now than it has ever had in its history. It has the highest unemployment percentage it has had at any time except during the depression years of the 1930s. Academics, business, labour and economic research institutes such as the C. D. Howe Institute and the Conference Board all called for expansionary budgets, but what they got from the Minister of Finance (Mr. Macdonald) was a budget which provides for no real expansion. The minister himself admits that there will be even more unemployed during 1977 than during the disastrous year of 1976.
What is the record? We have to look behind the honeyed words of the minister to find all the real facts, and they indeed show a picture of gloom and doom. In February of 1977, the last month for which we have figures, there were 932,000 people unemployed. That compares with 800,000 in February of 1976. The seasonally adjusted rate jumped from 7 per cent in February, 1976, to 7.9 per cent in February, 1977. The unadjusted rate jumped from 8 per cent in February, 1976, to 9.1 per cent in February, 1977.
Mr. Speaker, those of us who have watched the economic situation in Canada know that if you have moderate unemployment in the high growth areas, the prosperous provinces of Canada such as Ontario and British Columbia, what you have in the Altantic provinces and Quebec is economic disaster. If we look at the unemployment rates for those areas we can see that I have not exaggerated nor used inflammatory words, but am simply describing the situation as it is. In the Atlantic provinces the rate of unemployment in February, 1976, was 9.9 per cent; in February of this year it had jumped to 12.5 per cent. We know that while there still might be pretty good employment in Halifax, Dartmouth and probably St. John's, Newfoundland, what you have in places like Cape Breton and the small communities in Newfoundland is unemployment of anywhere from 30 per cent to 80 per cent.
In the province of Quebec the seasonally adjusted rate in February, 1976, was 8.4 per cent; in February, 1977, it had jumped to 9.7 per cent. In Quebec in February, 1976, 255,000 people were unemployed; in February, 1977, 303,000 were unemployed, an increase of almost 50,000.
Mr. Speaker, I ask today, as I have on so many other occasions, are we surprised that so many people in Quebec voted for a party whose major objective is the separation of that province from the rest of Canada? Should we be surprised that so many voted that way, or should we not be surprised that so many still voted for parties which believe in a federal state? Given the disinterest and lack of concern on the part of this federal government with the situation in Quebec, is it any wonder that the people of Quebec, particularly the young, turned to the separatist party in increasing numbers?
Let us keep in mind that of the 930,000 who were unemployed in February, almost half-429,000-were in the age group 15 to 24. Is it any wonder that the people of Quebec

April 5, 1977

have turned to a separatist party? What did the Minister of Finance tell them in the budget speech? What did he say last Sunday in the television program "Question Period"? What did the Minister of Manpower and Immigration (Mr. Cullen) say last night in this budget debate? He said the government is not doing anything more about unemployment because they cannot afford to. I have here a newspaper report of his speech and 1 think it quotes him exactly. In the Ottawa Citizen of April 5, the minister is quoted as follows:
"Nobody, I am sure, would suggest that these billions should be found by cutting out other federal programs which are so important to our economic and social well-being," Cullen said.
"Nor could we add the vast sums which would be required to existing governmental expenditures.
The second paragraph of the article reads as follows:
Even to reduce the unemployment rate to four or five per cent from the current seasonally-adjusted national average of 7.9 per cent "would cost literally billions."
1 had talked about numbers, Mr. Speaker, but what does it mean to people to be unemployed? Any newspaper in any part of Canada will give a report of what is happening. The Globe and Mail of March 17 had a report from London, Ontario, which read in part as follows:
Keith Gibbons is one of hundreds of young people who graduated from teachers' college last year and couldn't find a job. It wasn't for lack of effort. He sent out 150 applications for jobs within a 40-mile radius of London, where his wife is a law student. "But 1 only got three responses, and out of that, only one interview."


Mr. Kaplan:: How can the government make extra jobs for teachers?


David Orlikow: The parliamentary secretary asks how the government can make extra jobs for teachers. It is a very good question. Probably the Department of Manpower and Immigration should have consulted with provincial governments several years ago to see whether it was necessary to train as many teachers as we have. When I came to parliament we were getting annual reports from the Economic Council of Canada telling us that in order to meet the needs of modern society we had to give the labour force a better education. Mr. Speaker, we have the best educated corps of unemployed in the world. That is what we have done with our Manpower training programs and our educational system.
A report in the Globe and Mail of March 21, 1977, date-lined Dover, Newfoundland, began this way:
Even in a province where unemployment gallops along consistently at more than double the national average, this peaceful Bonavista Bay community of 947 souls is something of an anomaly.
An incredible 80 to 85 per cent of the able-bodied men in this picturesque, ocean-side hamlet are on the dole-far and away the highest unemployment rate per capita in Canada-and between 50 per cent and 60 per cent of the residents are on welfare.
I do not say that I have an answer for the people of Dover, Newfoundland, Mr. Speaker. I do not say we can find a job for every person who graduates from teachers' college, but I would not have given the university students of Toronto the answer the Prime Minister (Mr. Trudeau) gave them a few days ago. The report in the Globe and Mail of March 25-
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Mr. MacFarlane:: Even the students did not take that as authority.


David Orlikow: I hope they did not take the Prime Minister as an authority, either. He has not issued any denial of the report which reads as follows:
Prime Minister Pierre Trudeau has told a group of startled university students that if they are dissatified with job opportunities in Canada they should go to another country.
The newspaper further quotes him as saying:
"We're not going to put millions into subsidization of university graduates because they have a bleak view of their future," he said.
"And if they don't like it here, let them find another country where they could use university graduates, and if they can't use them anywhere else it s because there are too many university graduates ..."
There may be too many university graduates, but one could hardly blame the students now in universities who were pretty well assured by the adult population and politicians of all parties that there would be jobs for them. We are now in almost the same situation, in terms of percentages of the available work force which is unemployed, as we were, not in 1933 at the height of the depression but in the years 1937-38. At that time members of parliament like the then member for Winnipeg North Centre (Mr. Knowles), Mr. Woodsworth, and the then member for Winnipeg North, Mr. Heaps, said that we did not need to have the hundreds of thousands unemployed that we had, and that there was work that needed to be done. What was the answer then? It was that we did not have the money to put people to work. That was the stock answer in the 1930s. Then something happened in 1939.


An hon. Member:: It was called a war.


David Orlikow: Yes. Suddenly there was work for all who wanted it. The government was willing to spend money on weapons which destroyed other people, but not on things which people needed. Lo and behold, at the end of the war even the Liberal government of the day, headed by Mr. Mackenzie King and guided by a tremendously competent businessman, C. D. Howe, realized suddenly that with planning the needs of the Canadian people could be met: everyone could be put to work. We accepted the idea of full employment in this country. For many years, until the early 1970s, the Economic Council, members of which were appointed by Liberal governments, sometimes by Conservative governments, said we could have full employment in this country-if one defines full employment as an unemployment rate of 4 per cent. Now that our unemployment rate is 2'/2 times greater we are being told a number of different things by some so-called experts. Full employment is now attained, apparently, when our unemployment rate is 6 per cent, not 4 per cent. Unemployment is not as bad as it was in the 1930s. After all, we have unemployment insurance and welfare and no one is starving these days. 1 hope no one again will starve in this country.
We are told that a 9 per cent unemployment rate is not serious because almost half the unemployed are women. It is assumed by some that women do not count, that they are only

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working to augment their husbands' income or because they want luxuries. That is the rationale of government economists.


Iona Campagnolo: That is what you hear from the Conservatives.


Stanley Howard Knowles: Conservatives on both sides of the House.


David Orlikow: The former head of the Economic Council used to rationalize in that way. I suggest that women, married or not, work because they must, because their income is needed to maintain a decent standard of living. If a family wants to buy even a modest house, a woman's income is essential. Do hon. members not realize how much houses cost these days? I suppose 90 per cent of this country's families need two incomes if they arc to afford a house, a car, a holiday or any other large item. This applies especially to young married couples.
The Minister of Finance, on the program "Question Period" on Sunday night, and the Minister of Manpower and Immigration in his speech last night said that we must endure present levels of unemployment because we cannot afford to put people back to work.


An hon. Member:: That is not true.


David Orlikow: An hon. member opposite says that is not true.
I suggest it is true, because the Minister of Finance said in his budget speech, and his statement was repeated by the Minister of Manpower and Immigration, that in 1977 our labour force will grow by 250,000 persons. The Canada Works, Young Canada Works and other programs the government announced, plus the additional $100 million the Minister of Finance mentioned in the budget, will create 50,000 new jobs at best. The Minister of Finance estimated that the private sector of the economy will provide jobs for 150,000 people. I suggest the minister was too optimistic. He was too optimistic in his budgetary forecasts last year, and too optimistic when he spoke last week.
Let us assume the minister's estimates are right. The minister says the private sector will provide 150,000 new jobs, and the government's job creation programs additional jobs for
50.000	people. According to my arithmetic, that adds up to
200.000	new jobs. Yet departmental economists estimate that
250.000	people next year will join the work force. Therefore, according to the government's own figures, in the coming year unemployment will rise by 50,000 persons.


An hon. Member:: The figure will be closer to 100,000.


David Orlikow: The conference board, which is not composed of wild-eyed radicals, estimates that our growth this year will be closer to 3.5 per cent, not the minister's estimate of 4 per cent. They estimate that the private sector will provide substantially fewer than 150,000 new jobs and that the seasonally adjusted unemployment rate for 1977 will not be 7 per cent, as it was in 1976, but 8 per cent. Economists with whom I have been in touch in recent years and whose estimates have been

April 5, 1977
much closer to the mark than those of the government calculate that our unemployment rate is likely to be, not 8 per cent, as the conference board estimates, but 8.5 per cent. If the U.S. economy does not pick up-and it is not picking up at the rate calculated by the American government-our seasonally adjusted unemployment rate will be closer to 9 per cent.
Clearly, we are talking about one million unemployed in 1977, even if one accepts official figures. Even then, we are ignoring the hundreds of thousands of young people who have tried time and again, unsuccessfully, to find jobs, of people who cannot get jobs because there are none, of people in the maritimes, the interlake area of Manitoba and northern Ontario who know there are no jobs to be had and know it is useless looking for work. But, says the government, "We cannot afford to do more. We cannot afford to pump more than an extra $100 million into job creation." It forgets what it did in those terrible days of 1971 and 1972 when, according to the Leader of the Opposition, the minority government was doing terrible things. He did not specify, because I suppose he did not want to say that he thought increasing and indexing old age pensions was a bad thing, increasing the Canada Pension Plan was bad, increasing and indexing family allowances was bad. Yet these things were done under a minority government.


Stanley Howard Knowles: Don't forget veterans' pensions.


David Orlikow: Yes, they were increased and indexed. Apparently the Leader of the Opposition thinks those accomplishments of the minority parliament were terrible. Well, in those terrible days when our unemployment rate was 6.2 per cent, not 7.9 per cent, the government was persuaded to spend $500 million on a capital works program. To put people back to work it made $500 million available to provinces and municipalities for needed works projects. Today, however, we are told that we cannot afford to spend more than $100 million which the government has put into job creation. We cannot afford to spend more than the $100 million of this total $350 million which has been allocated for job creation. As a result of the one million unemployed we will lose as of this year, 1977, $8 billion in gross national production. This means that in each of the years 1976 and 1977 government revenues will be less than they could have been, by $1 'A billion.
Because we have one million unemployed we will spend $3 billion in this coming year to prop up the unemployment insurance system and on welfare payments to people who should be working. I cannot think of anything less useful or more wasteful and degrading than spending money in that way. What does the government intend to do with these one million unemployed? They say they cannot find money to put these people back to work, despite the fact that industry is operating at 80 per cent capacity.


Mr. Hogan:: Sixty per cent in the Atlantic region.
April 5, 1977


David Orlikow: The government says we cannot afford to start up needed projects such as new sewer and water systems in our expanding cities, modernizing hospitals, some of which are more than 100 years old, rebuilding schools in the core area of our cities, and dealing with the problems of native people who are becoming more and more desperate. But the government says that it will encourage industry to modernize. If industry will modernize, they will give them over $1 billion in the year 1977. They do not have money for job creation, but for tax relief in respect of business inventories they have $300 million. For federal investment tax credits there is $485 million; for enhanced depletion for high-cost oil and gas wells, $20 million. For increased dividend tax credits there is $120 million, and for an increase in limit for capital losses there is $45 million. The government will not tax capital gains at the full rate, but for capital losses there is $45 million.
For inclusion of capital gains on Canadian securities there is $10 million. For other corporate and investor tax concessions, $100 million, and for losses in provincial revenues related to above, $165 million. That totals a cool $1,245 million. Again we get from this government, "To those who have shall be given."


Andrew Hogan: That is the Liberal motto.


David Orlikow: It has been the Liberal motto for many years. There is no reason for the rate of unemployment we have in this country. There is only one other country in the western world which has anywhere near the rate of Canada. That is our neighbour to the south. From reading the newspapers it appears that Great Britain may go bankrupt, if not today then certainly tomorrow or early next week. However, even though it is in these dire straits the unemployment rate there is about half the rate in Canada.
This government has failed again. This is a cruel, callous and needless budget. Instead of dealing with the problem of unemployment it has again concentrated on the myth that we can and need to deal with inflation. For reasons which had nothing to do with the anti-inflation program, reasons beyond the control of this government, because the price of food did not rise at the rate it had been rising, the cost of living last year increased by only 6.2 per cent. The government took a great deal of credit for that. We said that credit was undeserved. This year they will have to take the blame, probably undeserved, for a much larger increase. Food and fuel prices are rising sharply. The minister will permit a $2 a barrel increase in the price of oil in the very near future. I predict that in 1977 the cost of living will increase between 8 per cent and 9 per cent. The misery index in this country, to coin a phrase, the total of inflation and unemployment, will increase next year to 20 per cent if one calculates the rate of unemployment and the rate of inflation. That is the result of having a Liberal government with its antiquated economic ideas.


The Acting Speaker (Mr. Turner):: Order, please. 1 regret to interrupt the hon. member, but his time has expired.
The Budget-Mr. McCain


Mr. Fred McCain (Carleton-Charlotte):: Mr. Speaker, yesterday the hon. member for York-Simcoe (Mr. Stevens) gave an excellent analysis of the deficiencies of the government and the chaotic consequences of its economic policy. It is indeed hard to follow such a laudable effort. However, it was followed today with a contribution by our leader which will go down as one of the good speeches in this House, one of the critical speeches in this House, one that indicates without doubt that he has a conception of what Canada needs and a conception which the government of Canada lacks. He showed beyond a doubt that he is of a calibre to more than replace the Prime Minister (Mr. Trudeau) and to take over the leadership of Canada in a constructive and beneficial way.
There are, however, a few things which remain unsaid. There appeared in the Ottawa Journal of April 1 a graph recording the surplus and deficit position resulting from government budgets from 1955 to 1974. It would be difficult to give a more graphic picture, a more understandable picture of the results of the economic and monetary policies followed by this government and the long-term position in which it places the taxpayers.
This graph shows that from 1955 to 1974, a twenty-year period, the net budgetary deficit was $6,163 million. In 1978 the cash deficiency of this government will be $6,400 million. In other words, in Fiscal year 1978 we will go further into the hole than we did in the twenty-year period from 1955 to 1974 inclusive. In the budgets of 1974 to 1978 inclusive, the aggregate deficit in that five-year period is three times that of the aggregate deficit of the twenty-year period from 1955 to 1974. It would seem to me that this government has given Canada quite a push down an otter's slide of economic disaster.
The government either has been absolutely incompetent in its prediction of cost programs, as one piled upon the other, or it has decided to curry favour and to hold power regardless of the cost to the taxpayer and regardless of the ultimate economic consequence to this nation.
The multibillion dollar error made when the revision of the Unemployment Insurance Act took place is a prime example. There was no emergency provision in that act for there being a million people unemployed in Canada. There was no historic examination of the cyclical nature of worldwide income. It is obvious that it was not there. It was just assumed that the all-powerful government was capable of controlling the economy. It ignored history. It has been proven that it was as false an assumption then as it would have been at any other point in time in economic history.
The government may make a contribution by sound and solid economic policies, but it cannot reverse the trends once they have been created. No matter how this budget is examined, it does not qualify within the guidelines established by the government's anti-inflation policy. The nation must have been beguiled, mesmerized or plainly deceived in the election of 1974. Hon. Robert Stanfield had the courage to face the people of Canada with a policy that he recognized might not

April 5, 1977
The Budget-Mr. McCain
be popular. He was convinced it was a policy that was necessary to dispel the inflationary expectations of that day. He lost the election to that beguiling and charismatic government which is presently in office, which in turn adopted a plan, though similar in name to wage and price controls as proposed by the hon. member for Halifax (Mr. Stanfield), was at best a hybrid, mongrel version of his plan. It has not, and will not, accomplish the goals necessary to stabilize our economy. It contained absolutely no incentive for labour to become more productive, for industry to become more productive, for industry to be able to reduce margins, for industry to reduce prices as a result of the co-operative productivity effort of management and labour. It put nothing in to give anybody any desire to do a better job. It put the brakes on wages, profits and development.
It operated on the policy that profit is evil and productivity is undesired. It was not accomplished by leadership of government; it was not accompanied by an educational program; and it did not explain to Canadians the situation in which they found themselves. I have great confidence in the mass of Canadians, confidence which the government lacks. Within the memory of many people in this House, a U.S. president by the name of Roosevelt led his country. He spoke to his people explaining the situation, first at home during the thirties and the depression, and later the situation as it existed abroad as we passed into a war in which it was inevitable that the United States would have to become involved. It was unpopular to tell the people of the United States any of the facts in either of these situations. Mr. Roosevelt, calmly, slowly and openly adjusted the people of the United States to the situation in which they found themselves and prepared them for the action which had to be taken.
When one considers this example and the examples of other great statesmen of this and other countries, one realizes it has certainly been a government without courage that has governed us. It has certainly showed none of the courage of Roosevelt or other leaders. That is what this country needed above all else-good management, good leadership, good relations with the people, and good economic policies. We have lacked them all.


Some hon. Members:: Hear, hear!


Fred Alward McCain: The cash requirement of the government has removed it from the capability of exerting an important influence upon our economy in times of emergency. The people of Canada are reconciled to the fact that perhaps this budget, under existing circumstances, has done about all that could be expected in view of the government's financial dilemma. It is incapable of exerting the effort available to a government with good management. Because of those governments which prevailed through the fifties and the sixties in this country we realize that in order to make the minimal contribution we must enter the money markets of Canada and the world, to the detriment of those who require money for development which would create employment or, worse still, the government must
[Mr McCain.]
start printing money, which would merely add to future inflation.
Government expenditures are non-productive. Private expenditures are productive. The private sphere still employs about 90 per cent of the people who work. While the government is taking an ever-increasing portion of the work force, it cannot in itself absorb a significant portion of the million people presently unemployed, nor will it be able to do so in the foreseeable future. It is in conflict with its own purposes. Only a change in government and total reassessment of public management can ever put the people in control of their own affairs.
Much of Canada's financing has been done abroad, and the present decline of the Canadian dollar, or the increasing value of certain foreign currencies would indicate that perhaps we do not yet know the consequence of living so lavishly. The Prime Minister accused the people of living beyond their means, but he did not admit that the government lived beyond the means of the people, nor did he acknowledge the consequences of it.
In 1972 a Canadian corporation floated a Swiss loan for 104 million francs. At that time they were converted into $27 million Canadian. At the existing rate of exchange the 104 million Swiss francs are worth about $43.1 million Canadian. That is the consequence of a private corporation being forced into the foreign markets to borrow, primarily because our government has absorbed so much of our own money that there is no room for the private borrower in the Canadian market.
The figure is particularly significant to the treasuries of the lesser governments of Canada than the federal government which are less capable of absorbing the losses suffered as a result of unfavourable changes in international currency. The provinces, the municipalities and publicly-owned utilities are looking at substantially increased burdens of interest and amortization costs. This is only one of the ways in which the unfavourable federal policy has exerted itself and has exerted a severely unfavourable influence upon other jurisdictions in Canada.
Realizing, too late, that the Unemployment Insurance Act was exerting unforeseen and undesirable pressures upon the treasury of Canada, we now have before the House a bill intended to reduce unemployment insurance benefits. It could not have been introduced at a more unfavourable moment in time, particularly as it relates to the less favoured areas of Canada. The vast bulk of the savings are to be at the expense of the Atlantic area and any other areas of Canada which have that burdensome 10 per cent or more of unemployment.
Every department of every Atlantic province government is struggling to stay within the guidelines of the Anti-Inflation Board. Every welfare payment estimate shows that payments will go up by not less than 20 per cent. This transfers the savings of the government of Canada at the expense of the provinces. One Nova Scotia minister, in commenting on the financial dilemma of his province in the field of welfare, has
April 5, 1977

said that the federal chickens were coming home to roost. Not in Ontario, not in Alberta, not in Saskatchewan, not even in British Columbia, but in the less favoured areas of Canada, and particularly in the Altantic area, the federal chickens are coming home to roost in more ways than one.
For instance, Mr. Speaker, responsibilities assumed by the federal government in respect of vocational training programs and for the upgrading of the qualifications of members of the work force have in the past been a very important item in our structure. They have brought about an improvement in the capability of our work force. The province of New Brunswick spent a great deal of money to establish the training centres and to equip and staff them. The government of Canada contributed to operational expenses by allocating money to applicants for courses. Recently the amount of money supplied by the government of Canada has been relatively static. While inflation has exerted its full force in the cost of materials, repairs, instructors' salaries and every possible aspect of cost, the federal contribution has failed to recognize inflationary tendencies. The province, having gone into the program in good faith, now finds itself spending money that it never anticipated would be necessary and is compelled to retract from its volume of training that had been jointly supplied.
During the winter of 1976-77 a supplementary expenditure was considered necessary for job creation through LIP programs. The moneys allocated to New Brunswick were not all absorbed by applicants at hand. The New Brunswick minister of labour asked the government of Canada to divert the excess money from LIP programs to training programs in New Brunswick. This was not acceptable to the government of Canada and $1 million once considered necessary to the economy of New Brunswick was moved elsewhere and was not used for upgrading purposes.
The economic problem is obvious and chronic, but it is beyond the capabilities of this government to recognize and resolve it. While we may not have as many votes as there are in Montreal or Toronto, we do have human beings who need to be considered in a heartfelt way. It cannot be denied that there are certain incentives in this budget which may encourage development in the poorer areas of Canada. But in his speech the minister implied, indeed said very directly, that it will take some time, a time he did not choose to define, before the effect of these incentives will become obvious. So those in areas in which the incentives have been offered are patiently to twiddle their thumbs until the magic of the Macdonald budget finally reaches out to improve their work opportunities, fully knowing that the government of Canada has wasted its substance in riotous living and is in no position to be of any real help in this time of dire need.
There was a time, Mr. Speaker, when a person might point the finger of blame at an individual cabinet minister. This is no longer the case. The Prime Minister has conducted himself in a fashion which indicates that he is quite willing to take all the credit for anything good which emerges from his government's policies, but he will sack a minister, such as Gray or Turner, Hellyer or Richardson, Marchand or Andras, if things
The Budget-Mr. McCain
do not go just right. Yet he and the 300 people in the Prime Minister's office will jealously claim all the credit.
At this point in time it is abundantly clear that experienced people are required, that ideologists are passe, that we must look reality squarely in the face and recognize that charisma will not fill lunch-buckets. This can only be done by ability, ability that is abysmally lacking in the present administration. From the Prime Minister down the Liberal party has proven to Canada that it is incapable of understanding what has happened, and therefore utterly incapable of correcting the errors of its past.
Let us make full allowance for all the outside forces which have exerted themselves upon Canada's economic affairs. These are the crutch, the excuses which one finance minister after another has used. But having done this we find foreign sources did not increase the tax burden, did not increase the monstrosity of administration which we presently have, and did not bungle the internal management of our affairs. The list of countries which have succeeded in this manner has been referred to many times during this debate. Foreign sources did not stagnate exploration and development of our energy resources, and did not lead to confrontation with the provinces. It did not irritate any ethnic group in this country. It merely provided a crutch, an excuse for this government to hold before the public, as the reason for a million unemployed in this country, that foreign influences are beyond our control. This is a deceitful approach and justifies the replacement of this government at the earliest possible moment.
Both the Minister of Finance and his critics have discounted the unfavourable balance of trade. I should like to isolate one particular aspect of our trade, namely agriculture. In 1971 the then minister of agriculture, the hon. Mr. Olson, when he addressed the Canadian Horticultural Council stated that Canada had embarked upon a "cheap food" policy, that the Canadian market would be more open to foreign sources of supply. In 1970 Canada imported approximately $1,250 million worth of food. In 1975, four years after the announcement by the then minister Mr. Olson, Canada imported approximately $2,900 million worth of food.
It must be admitted that a certain portion of our food imports cannot be controlled because there are foods which we cannot produce, but a large portion can be controlled and should be controlled. It is within Canada's horticultural capability to produce a much larger part of our own requirements. In this budget as part of the ways and means we are again faced with the reduction of duties on meats and other products at a time when our producers are already losing hundreds of millions of dollars. The cheap food policy is still in place. It is not in place for textiles, and I did not hear the consumers complain. It is not in place for other industries in Canada, and I did not hear the consumers complain either. But it is in place for food, for which Canada is famous.
There are further reductions in duties for certain food products which are competitive with fruits grown in Canada. The price of a can of orange juice will influence the consumer if it seems to be a better buy than apple juice, and this

April 5, 1977
Tabling of Documents
influence will go beyond the point of personal preference for a particular juice. It is just pure, ordinary common sense that will guide the hard-pressed consumer to the best buy on the shelf, regardless of its source of production. This, therefore, is detrimental to the interests of the average fruit producer in Canada, just as other cheap foods are detrimental to the producers of competitive products in Canada.
Not only does foreign competition from unreasonably low-cost areas take a serious toll of our farm incomes. It also eliminates this sector of agriculture as an employer from the production level right through the processing structure. We are talking in terms of tens of thousands of jobs and hundreds of millions of dollars of agricultural income. In view of the stress on our economy, it is high time that the government of Canada took a long, hard look at this as one of the points to be considered in reducing the unemployment roll, increasing the incomes of those in the agricultural industry, as well as improving our trade balance.
I have referred to increased imports of foods, Mr. Speaker. In 1971, Canadians imported $1,299 million worth of food. This was just at the beginning of the new cheap food policy. In
1972, imports increased by $239 million to $1,538 million. In
1973, imports increased by $625 million to $2,163 million. In 1974 it increased by $665 million to $2,828 million.


The Acting Speaker (Mr. Turner):: Order, please. It being 5.30 p.m., and pursuant to an order made earlier this day, this House will now revert to the tabling of documents.



ROUTINE PROCEEDINGS


Otto Emil Lang: Thank you, Mr. Speaker. I apologize to the hon. member for the interruption. Under Standing Order 41(2) I would like to table at this time documents containing agreement between Her Majesty the Queen and the province of British Columbia in connection with certain rail lines in northern British Columbia.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Macdonald (Rosedale) that this House approve in general the budgetary policy of the government, and the amendment (Mr. Stevens) thereto (P. 4609), and the amendment to the amendment (Mr. Saltsman) (P. 4613).
Fred Alward McCain: In the ten year period from 1966 to 1975 the increase in food imports was $1,855 million, or 185 per cent. That is the cost to the labour force in the farm industry, the cost to the farmer and to the processing and distribution industries which this country has experienced as agriculture has been neglected and food has been imported from abroad. We cannot tolerate this situation.
This is the situation not only so far as exotic foods are concerned; it exists also with foods with which we are quite familiar. Our imports of cherries went up by 7 million pounds in that ten year period; our imports of pears went up by 16 million pounds, plums by 16 million pounds, strawberries by 12 million pounds, apples-and this is very important-went up from 54 million pounds to 148 million pounds. That is what happens when the market is left unprotected and imports come in from areas with which we never could and never will be able to compete. We can go down the list and we find the same situation with regard to celery, corn, onions, tomatoes, and asparagus. Every one of these items was at one time important to a group of farmers in Canada but their market has been displaced by imports from outside, to the detriment of the national economy.
If we only wish to consider agriculture as an industry at home, let us give it another thought. At present we have $1 billion worth of straight surplus in agricultural products, but this has been created primarily by an increase in the volume of grain for export and also an increase in the price in the last two years which I have discussed. If at any time we have a decrease in crops or even a decrease in price, Canada will find itself, in dollar terms, in a deficient position in respect of agricultural trade. This country cannot afford that. When pressed hard enough, this country took into consideration the textile industry and acted on its behalf. I applaud the government for that action, but 1 attack it with all the strength of my heart for its neglect of Canada's food supply and of those associated with it.
The Minister of Regional Economic Expansion (Mr. Les-sard) gave a rather important speech this afternoon, but I think there are a few things of which we should become cognizant, namely, the defeating and contradictory parts of government in respect of the minister's efforts. I ask him to ask the Minister of Energy, Mines and Resources (Mr. Gillespie) what was his position in respect of the construction of refinery structures in the oil industry on the Atlantic coast during the energy crisis. Was it constructive to the develop-
April 5, 1977

ment of those industries in that area? The answer is no, it was not. DREE moneys are being spent on the one hand and private moneys would have been spent on the other, but this was made impossible by the ridiculous regulations of the Minister of Energy, Mines and Resources.
How about the Minister of Transport (Mr. Lang)? During the last session of parliament we had a bill which brought in what was known as the Maritime Code. At the same time discussions were going on for the construction of a complex for the production of steel in Sydney, Nova Scotia. The code was there. A headline in the Halifax Chronicle-Herald at that time stated "Maritime Code Detrimental to Steel Industry Development". I telephoned the president of that company, and his reply to me in respect of the Maritime Code was that if we had ever planned to build this complex in Sydney, the Maritime Code and the indecisive replies from the Minister of Transport had wiped it out because it would be cheaper to take the ore from Canada to Europe, and the coal from Cape Breton to Europe, and do the processing there, by virtue of the additional costs of sea freight alone. That was the co-operation which the Minister of DREE had from the Minister of Transport.
While he is developing industry and making his grants, what help is he getting from the Minister of Supply and Services (Mr. Goyer) or the Minister of Public Works (Mr. Buchanan)? What items are being purchased in the Atlantic area or in any of the depressed areas in Canada? I believe the hon. member for Vancouver South (Mr. Fraser) stated the case for one of his industries in a very strong and proper way last evening during the "late show". I believe that, with a little more consideration by the purchasing agencies of the government, there would not be the massive unemployment there is in the Atlantic area because there are certain items that can and should be produced there which are required by the government, and which would give a major economic lift to the area.
While the minister is making grants through DREE, does he understand the detrimental effects of poor transport policies in the Atlantic area? Is he aware of the neglect of the ports of Halifax and Saint John? Is he aware of the shortage of equipment for the movement of perishable products in that area? Is he aware of the difficulties which took place? Is he the one who influenced the expenditure of tens of millions of dollars in the Montreal area-hundreds of millions in total- on that port, while we have a study going on with regard to the port of Halifax and another being completed on the port of Saint John? We spend $10 million on a port which has reached a static level in its volume of trade and we are neglecting two Atlantic ports which have had an increasing amount of trade over the past few years. The trend is there, but the money is not. So the Minister of DREE is bucking the odds within his own cabinet. These are rather serious odds.
We heard the hon. member for Fort William (Mr. McRae) last night, and we heard comparable statements from others today complaining about the rapid increase in the work force in the last two years. They should not cry about this. Did they not have all this information at their fingertips? Did Statistics
The Budget-Mr. Faulkner
Canada not tell them 15 years ago that they would have X number of people coming in 1977 and Y number of people coming in 1978? The statistics were there, the handwriting was on the wall. It is no use making excuses in the budget introduced in 1977 for what happened and for what should have been planned in the last 15, 18 or 20 years. This is another point which was brought out by the hon. member for York-Simcoe (Mr. Stevens) when he stated there is no projection of requirements for Canada, no forecast of what is coming down the road for us. We are going down a blind alley every time we get a budget.
I mentioned agriculture and the various road blocks in respect of freedom of trade which has been granted to foreigners in this country. I want to mention one other thing. The Minister of Agriculture (Mr. Whelan) sat by complacently while we protected the chemical industry of Canada which manufactures pesticides. The government has blocked the border so that a private farmer cannot go south to bring in his requirements. Are the Minister of Agriculture, the Minister of Consumer and Corporate Affairs (Mr. Abbott), or the AntiInflation Board monitoring the expense that this imposes on farmers? I wonder if they care, and do they know that at least one item required by the farmers costs 50 per cent more than last year?


The Acting Speaker (Mr. Turner):: Order, please. I regret to inform the hon. member that his allotted time has expired. He may continue with unanimous consent. Does he have unanimous consent?


Some hon. Members:: Agreed.


Fred Alward McCain: Has any agency of government considered that one of the chemicals used by the potato industry from coast to coast in Canada is not available in Canada? Do they understand that this particular chemical, fusarex, puts a better quality of potato on the table, puts a better quality of potato through the processing plant, and produces a better quality of potato for the processor to sell? It is now not available at all because the Department of National Health and Welfare, the Department of Agriculture or some other department has refused to register it, even though it is registered in the United States, is used in the United States and is needed in Canada. Where is the concern of this government for the people when it will tolerate, without any exercise of control, an increase of 50 per cent in the price of an agricultural product to protect the chemical industry while introducing in the budget, on the other hand, a list of food items, many of which we produce, and on which duties have been reduced? If ever there was a contradictory situation, the government has given us an example in this budget.


Hon. James Hugh Faulkner (Minister of State for Science and Technology):: Mr. Speaker, I am very pleased to be able to participate in this debate, and I would like to discuss a very particular aspect of the budget and comment on the important relationship which exists between the budgetary proposals

April 5, 1977
The Budget-Mr. Faulkner
which have been introduced by my colleague, the Minister of Finance (Mr. Macdonald), and the government's science policy with respect to the industrial sector. Not only does the budget emphasize the importance of research and development in Canadian industry, it also provides a well rounded package of mutually supportive measures to encourage new industrial ventures, to create jobs, including jobs for highly qualified manpower, and to give special support to the new enterprises that are now getting established outside Canada's principal industrial centres.
However, before commenting in detail on those aspects of the budget that are most closely linked to the government's science policy, I would like to explain some of the circumstances which characterize the current state of science and technology in Canada.
As a nation Canada spends about 1 per cent of its gross national product on research and development. In terms of performance roughly one third of this amount pertains to government research, one third to university research, and one third to industrial research. The government is aware that Canada's national research effort is less than half that of other industrialized nations, and that the distribution of effort among the three performing sectors is the inverse of most other western nations, where typically industry performs 60 per cent of the national research effort, both internally funded and publicly funded. As I will explain shortly, the proposed budget reflects the government's intention to give greater emphasis to the research effort in industry and to design measures and policies that will encourage industry itself to take on greater responsibilities in this area.
However, more worrisome than the relatively low level of research expenditures in Canada, or the different mix of research performers, has been the recent decline in Canada's research intensity. In 1967 Canada spent 1.29 per cent of its gross national product on research and development. In 1975 this share declined to 1.1 per cent. The decline has been particularly sharp in the industrial sector, where the research intensity dropped from 1.2 per cent of sales to 0.7 per cent. As a percentage of GNP this is equivalent to a decline in the industrial share from 0.5 per cent in 1967 to 0.41 per cent in 1973. From a study which was done for my ministry we know that the decline in industrial research has been at a significantly higher rate than the over-all decline of industrial development during that period.
While I subscribe to the general thesis that a healthy industrial sector will generate enough investment funds to support an adequate level of research and development, and in do'ng so will maintain a reliable lifeline to the future, there is sufficient evidence to share the widespread concern that the current shortcomings in Canada's industrial research effort are so serious that special measures are warranted. It is for this reason that the government, through its budget which is now before us, has provided for a variety of measures to~Stimulate industrial investment in general and industrial research and development in particular. However, before describing the

economic significance of these measures, I wish to draw to the attention of the House their historic perspective.
The present state of industrial research in Canada reflects, in a way, our history as a young nation, nation rich in resources, thinly populated, close to one of the most advanced industrial nations of the world, and historically oriented toward primary industries. Because of the wealth of natural resources, Canada's first emphasis in science has been in such fields as geology, agriculture, forestry, and fisheries. In view of the national importance of resource inventories and improved farming techniques, most of these efforts started in government and have remained in government. Thus, for historical reasons, the government's own scientific activities have traditionally been the first tier in Canada's national scientific endeavour.
The second tier was built after the second world war when it became clear that Canada's post-secondary education was not up to international standards. Thus, through a system of grants and transfer payments to the provinces, the next phase of our national scientific development took place in our universities. As a result the number of Canadian universities offering post-graduate degrees has tripled over the past 30 years, and the quality of research in many Canadian universities has reached levels of international recognition. I will speak shortly about recent government decisions to maintain the level of excellence in our universities and to strengthen the granting system.
As for industry, Canada's research effort did not start seriously until the early fifties. By that time Canada's manufacturing sector had developed from an industrial policy which was based on protective customs duties on a wide range of manufactured products, open investment, and immigration. After the war, with the widespread tariff reductions which resulted from the General Agreement on Tariffs and Trade, the general government policy to encourage the establishment of any manufacturing industry made place for more specific programs and trade agreements to assist Canadian manufacturers in adjusting to the lower tariffs and to improve the level of science and technology in Canadian industry.
However, despite these efforts, Canada's secondary industry is still lagging in productivity, and recent studies on the effectiveness of direct government grants to stimulate industrial research and development have led to the discontinuation or re-orientation of some of the direct support programs. At the same time we observe, however, that Canada has a strong international presence in such areas as mining and metallurgy, telecommunications, steelmaking, and small jet engines.
We know from many examples that Canadian industry has the capability to undertake sophisticated research and development programs, and the skills to exploit these developments in the international market. We also know that organized research and development, if successful, provides for about a 25 per cent return to a company. Yet individual companies are never certain of the ultimate outcome of research and development, and this element of risk is often cited as the reason why industry has a natural tendency to under-invest in research
April 5, 1977

and development. In Canada this tendency has recently been aggravated by corporate cash flow problems resulting from inflation and certain accounting procedures. It is for this reason that the 3 per cent inventory adjustment which is now being introduced in the budget will also be of benefit to the research effort of Canadian enterprises.
Having established a rather broadly based manufacturing industry in Canada, we are now faced with the challenge of making that sector more efficient, productive, and internationally competent. In addition we are faced with the challenge that is presented by the imbalance between a relatively well developed university sector, producing large numbers of highly qualified scientists and engineers, and the capacity of the industrial sector to absorb the entire annual crop of graduates. Under these circumstances, and certainly in times of financial restraint, the temptation exists to cut back on university support. However, such a decision would be to the long term detriment of Canada, and the government has decided to maintain a good level of university support while emphasizing the build-up of science and technology in industry. This new emphasis, which I will now explain in more detail, is a logical extension of the initial thrust of government science and of the post-war emphasis on university development.
In developing its policies to support industrial research and development, the government has been guided by four principles. First of all it was felt that the thrust of government support for industrial research should be indirect rather than direct. Such an approach not only safeguards the freedom of individual companies to make research and development decisions, but is also in keeping with the government's fiscal policy to restrain direct expenditures. Second, it was felt that government support should be sufficiently stable, and the policy sufficiently clear, to encourage companies to make long term commitments to their research and development efforts; third, that it should contribute to the creation of cash flow; and finally that it should achieve a more rapid creation of new techniques and products, which is particularly important in a high wage economy in a world where new innovations diffuse rapidly to lower wage economics.
The first approach to such indirect support has been the government policy to contract out to the private sector the research requirements of individual government departments. Under this policy Canadian industry is invited, on a competitive basis, to provide certain scientific and technological services that are required in support of government missions. Federal research contracts have increased from $18 million in 1972-73 to $86 million in the past year, and now constitute about 12 per cent of the federal research budget. Of particular interest under the contracting out policy has been the emergence of small, highly qualified, science-intensive companies, typically employing between 25 and 50 people, having annual sales of between $2 million and $5 million and excellent growth prospects.
The Budget-Mr. Faulkner
Another important feature of the contracting out policy has been the regional distribution of the science contracts. Some 30 per cent of the total contract value during 1976-77 was awarded to companies outside the principal industrial regions of Canada. The Department of Supply and Services, which is responsible for all contracting under the policy, has contributed significantly to this particular aspect of the policy by decentralizing some of its science-contract officers to Vancouver and Halifax and, more recently, to Montreal.
It is clear from our experience to date that the contracting out policy is an important mechanism to provide indirect support to industrial research and development in Canada. Already we know of major technological and commercial achievements by a number of Canadian companies that have received government research contracts, and the policy has brought government scientists in close touch with Canadian industry. Part of this initial success must be ascribed to the government decision of 1974 to encourage Canadian industry to make unsolicited proposals to government departments in order to provide even better chances for commercial spin-offs from government sponsored research. In 1976 the contracting out policy was extended to cover new as well as ongoing programs and to include other scientific activities besides research. My department, in co-operation with the Treasury Board secretariat, has now completed new guidelines and ground rules for the extended policy and these will be announced shortly.
While the contracting out policy is useful to those companies whose research and development objectives run parallel to those of government-as tends to be the case in the eletronics industry, the transportation industry, and in the general area of scientific and technical services-the policy does not offer much opportunity for companies whose research efforts do not coincide with those of government. Yet research and development is of importance to all sectors of industry, and support is needed among a broad range of companies. In order to respond to that pressing need, and in order to acknowledge and emphasize that research and development expenditures are an essential business investment in our economy, the budget proposes to extend the 5 per cent investment tax credit which is scheduled to expire on June 30 of this year, until July 1, 1980. It will also include in its coverage, current and capital expenditures on scientific research and development made after March 31, 1977, and before July 1, 1980. The extension and enrichment of the credit will mean an immediate research and development incentive of $35 million to $40 million during 1977, and the new measure will more than offset the loss of the IRDIA program which was discontinued in 1976.
By applying a three tier credit rate, the extended incentive will be of particular significance to new high technology enterprises that are getting established outside Canada's principal industrial sectors. However, the principal benefits of the proposed tax credits are expected to flow to the larger and medium size industrial research establishments in Canada. As such, the proposed tax incentive constitutes a strong and essential counterpart to the contracting out policy which has
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April 5, 1977
The Budget-Mr. Faulkner
tended to concentrate our research contracts in the smaller industrial research units.
Perhaps I could call it six o'clock, Mr. Speaker.


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


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
James Hugh Faulkner: Mr. Speaker, before six o'clock I was talking about the state of industrial research and development in Canada, some of the historical reasons for the pattern which has emerged in this country, the importance the government attaches to a healthy industrial research capacity, and about the major provisions within the budget which reinforce that government intention. If I may, I should like to continue my remarks and discuss several other proposals in the budget, proposals which will be of benefit to science and technology in Canadian industry.
Besides the important financial incentives for established industrial research units, the budget gives clear recognition to the importance of entrepreneurs and start-up ventures by allowing a more favourable tax treatment to stock-option plans for employees of Canadian-controlled private companies, and by allowing the deferral of capital gains taxes when the proceeds of a sale of business properties are re-invested in the same business. This measure will be important to the many small technology-based enterprises that are expanding and relocating their business.
Another supportive measure for certain technology-based enterprises is the recommendation by the Minister of Finance that certain tariff items, particularly those dealing with scientific apparatus, be referred to the tariff board for study. With the expanding capability in Canada to manufacture sophisticated instruments, it will indeed be useful to re-examine the validity of allowing duty-free entry if the goods are imported by certain qualified users.
I hope, with the introductory remarks 1 made before six o'clock, to have demonstrated that the proposed budget contains a number of measures that are an important and integral part of the government's science policy. It has aspects, Mr. Speaker, on which we have received many thoughtful submissions from the private sector, both from industrial associations and from individual companies, and I am pleased to say that the current proposals accommodate and include many of the suggestions we have received.
While the thrust of our policy is toward indirect support, which tends to put a great deal of the responsibility for the final success of industrial research and development on the shoulders of individual firms, I should point out that the government has not discontinued all of its direct support

programs. I am now referring to the highly respected Industrial Research Assistance Program, IRAP, administered by the National Research Council, to the Defence Industry Productivity Program, DIPP, administered by the Department of Industry, Trade and Commerce, and to the new Entreprise Development Program now being established by the Department of Industry, Trade and Commerce. Taken together, these programs provide some $55 million per year in the form of cost-shared development grants to Canadian industry.
Thus, Mr. Speaker, after considerable thought and discussion, and in keeping with a general policy of fiscal restraint, the government has established a clear position vis-a-vis industrial research and development in Canada. The government recognizes and acknowledges industrial research and development as an essential business investment in our economy, and the budget now before this House is a firm expression of that conviction. The measures now in place, together with the proposals in this budget, constitute a range of measures to stimulate industrial research and development in different kinds of companies and different sectors of industry.
As I explained, the contracting-out policy is certainly benefiting small and medium sized Canadian-owned firms in three specific sectors of industry. The remaining programs of direct research support will continue to be of importance to middle sized firms no longer preoccupied with the problems of survival but which have, nevertheless, difficulties in raising the full amount of money to undertake complete programs of industrial innovation. In this spectrum the proposed tax incentive and the related budget measures constitute an important incentive to encourage the larger companies, in all sectors of industry, to strengthen their research and development effort in Canada.
Before completing these remarks I wish to refer briefly to two other areas of science policy on which the government's attention has been focused recently-the university sector and the in-house research programs of the Canadian government. As we all know, there has been a great deal of anxiety among the Canadian university community about declining research grants as a result of the government restraint program. In the last few months, however, there have been three significant developments to bring this period of difficulty and uncertainty to an end.
The first of these developments pertains to our decision last November to establish the Canadian Committee on Financing University Research. This committee, which was set up after extensive discussions between the federal and provincial governments and the universities, will provide a much needed focal point to exchange information on matters dealing with university research and it will become an important mechanism for the development of recommendations on policies, programs, and procedures affecting the financing of university research. In my judgment the formation of this committee will prove to be of great significance to the federal government in its role of fostering scientific research on a national basis and,
April 5, 1977

through close co-operation with the provinces, of enhancing the national research effort.
The second initiative I would like to mention is Bill C-26 which I recently introduced in this House and which is now awaiting second reading. As you know, Mr. Speaker, the bill proposes the creation of two new granting councils and a more logical arrangement of a variety of scientific activities in government departments. To improve liaison between the three award-granting bodies, I have proposed to establish an intercouncil co-ordinating committee, made up of the three presidents of the councils and chaired by the secretary of my ministry.
As I have already explained to this House, by improving the university granting system the government wishes to express its conviction that Canada benefits substantially from the research, and that the universities must continue to provide the climate of intellectual freedom so essential to the pursuit of knowledge.
The third initiative with respect to our policies for university research is the decision, subject to the approval of this House, to increase the 1977-78 council budgets by $20 million, of which $12 million will be to compensate for the inflationary rise in the costs of research programs during the past year. This decision is in line with my earlier statement that a drastic curtailment of university funding would not be in the national interest.
In addition to this increase to offset the eroding effect of inflation, the government proposes to allocate $8 million to the granting councils with the objective to achieve greater regional balance of scientific capability, to intensify research into areas of pressing national concern, one of which was referred to by the Minister of Finance in his introduction of the budget, and to promote expanded interdisciplinary research where that is required to deal with particular Canadian problems.
Thus, Mr. Speaker, I am pleased to convey to you that the government's science policy with respect to the support of university research and its concomitant requirements for better federal-provincial consultation has also taken firm shape during the past 12 months.
Finally I would like to refer to the third sector of scientific performance in Canada, the government sector. With the government's decision to control expenditures has come the need to examine whether government services are indeed being carried out in the most cost-effective manner. This examination includes a study of the government's science programs and my ministry, in co-operation with the Treasury Board secretariat and the departments concerned will review the science programs in order to ensure that the programs still meet a specific need, and to determine whether the programs ought to be carried out by government or elsewhere.
At the same time we recognize that science and technology will continue to play an important part in the execution of departmental missions, and new programs of research and development have been formulated in such areas as energy, space, and the environment. As a matter of principle, however,
The Budget-Mr. McKenzie
and in keeping with the government's desire to give more prominence to the role of the private sector in Canada, these new programs will be carried out with a maximum participation by Canadian industry. We believe that the ultimate diffusion of any new technology in society will be greatly enhanced when the initial research and development are undertaken with that final goal in mind.
The government has made major progress in formulating and implementing a meaningful science policy in Canada. Several of the measures that are now being proposed by the Minister of Finance form an integral part of that policy. For these particular reasons I commend the budget to the support of this House.


Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker,
I welcome the opportunity to speak on this latest budget. There is certainly not much to speak about, except mostly what has been left out. With the latest budget there will be no significant change on the Canadian scene with regard to high unemployment or economic resurgence.
The budget speech talks of an underlying trend to lower inflation. In fact the CPI is already moving sharply upwards. The last three months average annualized is %'h per cent. Underlying factors if anything predict a trend toward double digit inflation. These include higher import prices caused by devaluation, higher energy costs, and higher food prices.
There is no balance of payments objective and there is no government deficit objective. "But responsibility for the economy rests on others as well." The federal government is alone responsible for the money supply growth which fuels inflation.
The speech talks of responsibility also lying with the leadership of the labour movement. The budget document reveals that discussions with labour leaders have produced no voluntary wage guidelines.
The minister has forecast that 150,000 new jobs will be created. Under current economic conditions even that forecast may be optimistic. Even if the minister is correct, and he does not have a good track record, as the labour force is predicted to increase by 225,000, he is budgeting for an additional
75,000	unemployed on the average in 1977. The minister's budget is predicated on an average unemployment rate in 1977 of 7.7 per cent. That is not full employment budgeting.
The budget plans $458 million in spending to create jobs in 1977-78. However, $358 million was already a planned expenditure on job creation before this budget. The minister's policy of throwing a further $100 million at the unemployment problem is little more than spitting in the wind. It is a last ditch effort to try to disguise the fact that the budget is six months too late. All that the money they are spending on job creation will do is to reduce the rate of increase of unemployment.
The Minister of Finance (Mr. Macdonald) announced that there is no money for job creation programs, but lots of money to build a new park and recreation facility at Mirabel, and another federal government complex in Montreal as well as the Guy Favreau complex.
80012-17Vi

April 5, 1977
The Budget-Mr. McKenzie
Families were given very little in terms of reducing the income tax burden to help them in their personal battle against inflation. Although the unemployment expense deduction was increased by $250 and the tax credit for children under 18 was increased by $50 to a total tax credit limit of $500, the real effect of the budget was to increase the total income tax burden.
Changes in the federal-provincial fiscal arrangements for various cost-shared programs mean that the federal government needs less funding and thus can reduce taxes. However, the provinces will be required to make up the difference. Thus if one looks at the tax changes on the same basis as last year, the tax burden will be increased by 16 per cent on the average. In the years of Liberal government the tax burden upon Canadian families has risen from 12.9 per cent to 18.6 per cent of total income, a real measure of the loss of control over our own income that we have suffered.
From the government which had the audacity to tell Canadians that they are living too extravagantly has come a budget that records a $7 billion deficit, up nearly 50 per cent from last year's deficit. This sum is larger than the entire budget of the last Progressive Conservative government. It is a telling indictment of a government which for so long ceased to manage that it can look upon drift as economic leadership. It appears that we are headed toward a 90 cent dollar. Currency devaluations are the market's way of telling us that the economic management of the country is failing. It is in this context that the decline in our currency's value to 95 cents U.S. is viewed not as a problem in itself but as a symptom of a serious failure in economic management.
It now appears that four root causes have reduced the buying power of our currency. First, our rate of inflation has been consistently higher than that of our major trading partner, the United States. The implicit price index for gross national expenditure rose by 9 per cent in Canada compared to 4.8 per cent in the U.S. during the year ending in the third quarter of 1976. Second, this country has seen massive balance of payments deficits. The latest deficit was $1,363 million in the last quarter of 1976, the worst in Canadian history. Third, the political climate for investment in Canada has deteriorated drastically, and not only because of the situation in Quebec. Last year direct investment in Canada fell off by $1 billion to a net outflow of that type of investment of $400 million. Fourth, Canadian productivity is lagging. As the government sector increasingly dwarfs the productive element of the economy, this problem will grow ever more acute.
Any competitive advantage that Canadian sales abroad will receive from the discount pricing of our resources and manufactured goods will be no more than temporary if no action is taken on these fundamental problems. The experience of Britain, where currency devaluation is virtually a routine affair, shows that without strong action wage and import costs soon force export prices back up to unrealistic levels. When these goods become uncompetitive, balance of payments deficits

once again begin to pile up, forcing yet another currency devaluation. Unchecked, the process is a vicious spiral which ends up in national bankruptcy.
The human cost of the inability to deal with economic basics is measured in unemployment. This month figures were released showing that 932,000 Canadians, or 7.9 per cent of the labour force, are actively looking for work but unable to Find it. Official statistics do not record the number of people who have despaired of finding a job, but when the unofficial estimates of these numbers is included in the unemployment figures the total rises to well over one million. It is a shocking figure, and when one considers the waste and futility that lie behind these statistics one sees the true enormity of the failure of those entrusted to manage the economy.
In the face of the need for reform, this year's budget was prepared once again by the same government ministers and officials in the same state of total secrecy as the budgets of previous years which served this country so badly. At the end of last month we were once again told: "Here is the economic policy, like it or lump it." What is needed is an open process of consultation and it is needed now, not at some vague point in the future.
It is now clear to many that the country is well on its way to the 90 cent dollar. We have a million unemployed. Inflation is moving upward toward double digits. It is time to acknowledge the failures of the past and begin now the reforms that will get the country moving again.
I always like to acknowledge something which is constructive, Mr. Speaker, and although there were some slight tax reductions in the budget, they were surely far from enough. A substantial cut in personal income taxes should have been made. Tax breaks are necessary to restore growth and create jobs. Innovative tax measures to encourage business to create jobs are also necessary. A reduction in government intervention in the private sector and better communications among government, labour and business would restore the confidence of investors, both Canadian and foreign, who presently are reluctant to invest because of the Liberals' economic fiasco.
The government has the most devastating and dastardly record of any government in Canadian history. In 10 years the budget has skyrocketed over 400 per cent, from $8.8 billion to a forecast $46 billion in this past fiscal year, April 1, 1976, to March 31, 1977. Total government spending per person was $2,900 in 1975, but the government took in only $2,700 per person. Thus it has proceeded to spend an additional inflationary $200 for each of us. Transfer payments of $21.4 billion represent little more than half the current budget. Of these payments, more than $9 billion went directly to Canadian citizens in social welfare expenditures such as old age security, family allowances, and unemployment insurance. The national debt of the federal government will be around $28 billion at the end of the fiscal year, the result of budget deficits in 20 of the last 23 years.
Interest on the national debt, which was already $1.2 billion in 1967, will be around $4.6 billion at the end of this fiscal year, making it the third largest federal expenditure after
April 5, 1977

health and welfare and economic development and support- all in all, a very dismal record. The government is also contracted to guarantee the borrowings of Crown corporations such as Air Canada and the CBC. Last year the government guaranteed $15.5 billion in loans and advances to Crown corporations, which are accountable to no one. Federal spending has grown faster in the past ten years than the private economy that supports it. During the last fiscal year expenditures for the Liberal government's bilingualism program reached $121 million. Federal employees, excluding the armed forces, were paid approximately $5 billion in 1975, about triple the $1.7 billion they were earning in 1965. Some record, Mr. Speaker!
I should also like to give recognition to a colleague of mine, the hon. member for Peace River (Mr. Baldwin), who has been doing a commendable job in regard to Liberal government secrecy. The hon. member has lately been doing some advertising to get the message across to the Canadian people, and has formed a league, The League to Restore Parliamentary Control. I have joined his league and I fully support it. He has advertised in newspapers across the country and the advertisement reads:
I favour action to restore parliamentary control, including:
(a)	A freedom of information law, with a review process binding on the
government;-
With this government, Mr. Speaker, such a law is badly needed. The government does not like supplying any of us with information. The ad continues:
(b)	Accountability for spending of taxpayers' money and use of delegated
power;-
We have had no accountability, or adequate accountability of taxpayers' money which has been spent since the Liberals changed the rules in 1968, reducing the number of votes and destroying the committee system. There is no accounting to parliament now regarding government spending, a matter which has been highlighted in the last number of Auditor Generals' reports.
The hon. member's ad also calls for increased independence for private members. This means more consideration should be given to private members' bills. The government is always saying that we never have any alternatives or anything constructive to offer. But every time we offer a private member's bill or a private member's motion, something constructive, we hear a "no" or it is talked out.
The hon. member for Peace River has compiled a statement on his Freedom of Information League. 1 am not going to deal with the complete statement. One point that 1 am particularly concerned about is number two on his list, and that is government accounting for taxpayers' dollars. That is the prime responsibility of any elected official, to see that taxpayers' dollars are spent properly and that there is complete accountability. There is no complete accountability with this government. Hon. members see estimates going through different departments; hon. members see items under the heading "Oth-
The Budget-Mr. McKenzie
ers" have gone up $5 million, and hon. members see "Miscellaneous" has gone up $300 million. That has to be daylight robbery. It is an absolute farce and has nothing to do with accountability.
The document of the hon. member for Peace River on accountability states:
Two of the great revolts in the English speaking world ... The parliamentary rebellion against Charles I and the American revolution each had its origin in the improper taking and spending of tax money of the people.
Now we can add the Liberal government to that little historic document. The document continues:
And, now, hundreds of years later, we find we have gained nothing. In fact, we have lost much ground because of the monstrous increase in spending, the complexity of government and inability of parliament and the people to be kept advised and be aware of how much and the manner of government spending.
Starting in 1966 right through to 1972, the date of his last report, Mr. Maxwell Henderson, former Auditor General, made yearly comments about the weakening of parliamentary control of expenditure.
This means that the government does not want to be accountable and has no intention of being accountable. The document goes on:
This was not just through a philosophical statement but borne out and corroborated in each year by a number of very carefully detailed illustrations. But, nothing was done. To show it was not just one man's opinion, the present Auditor General, Mr. Macdonell, said in his last report for the fiscal year ending March 31, 1976, at page 9: "I am deeply concerned that Parliament and, indeed, the Government has lost, or is close to losing, effective control of the public purse. I expressed that concern a year ago in my Annual Report stating that:-
'The present state of the financial management and control system of departments and agencies of the Government of Canada is significantly below the acceptable standards of quality and effectiveness.' "
Last Sunday night I saw a television program that originated in Ottawa. It was a local commentator, and he had on two Liberal backbenchers. I see one of them in the House tonight. I did not hear one comment from either one of them about being accountable. The only thing we got out of them was that if we have shorter speeches parliament will work better.


Some hon. Members:: Hear, hear!


A. Daniel McKenzie: I hear the phony applause. Shorter speeches have nothing to do with being accountable. It has nothing to do with accountability; it has nothing to do with "Others" and "Miscellaneous". They want to strengthen the committee system. Of course, that is old hat. The Leader of the Official Opposition (Mr. Clark) proposed that ages ago. The committee system today is an utter farce. There was nothing discussed on this television program about philosophy. I never heard anything from these two backbenchers about strengthening the accounting system or dealing with the Auditor General's report. They tried to make this sound as though it were a mutual admiration society. They never covered any of the genuine issues, real issues.
To read further from the document:
Here's the best evidence possible that not only have the people, through their parliament, been unable to deal with official spending but the government itself is largely clueless.
I do not think the government knows what is going on. I do not think it can find out. The document continues:

April 5, 1977
The Budget-Mr. McKenzie
And, with this, federal public spending estimates jumped from 1971-72 to 1977-78 from $14 billion to $41 billion, and during this time the government has been engaged in an attempt to kid us all by telling us solemnly it is engaged in policies of restraint.
They do not even know the meaning of the word! It is an absolute farce. But when the two hon. members were on television, they tried to give us the impression that everything was upright and above board, and that they were being accountable and so forth.
I would like to refer to a question that I asked the Prime Minister (Mr. Trudeau) yesterday. It was with regard to a consultant's report received from E. P. FitzGerald & Associates in Ottawa. I asked the Prime Minister what he was going to do with this document. There are a lot of excellent recommendations in it. The Prime Minister said that I have a vested interest in this document. I never said I had a vested interest in the document. I asked him what he was going to do with that particular document. I said that it should be referred to the finance committee for study. The Prime Minister says that we have hundreds of answers and hundreds of documents. Well, what are they doing with all these hundreds of documents? This one in particular should be referred to the finance committee so that they could discuss some of the recommendations. I imagine that this document cost hundreds of thousands of dollars to be compiled. What are they going to do with it? I suppose we would never have heard anything about it if I had not obtained a copy of it.
There are some excellent suggestions in this report. As an example, it comments on the roles of government.
Whether we like it or not, government will continue to play a dominant role in managing affairs in our society. However, in order to provide the tax base necessary for the provision of services now regarded as essential, while at the same time limiting the unnecessary growth of the bureaucracy, four key elements require to be given special attention:
I would like to make one comment on the growth of the bureaucracy. We have a statement from the President of the Treasury Board (Mr. Andras) that they are going to curtail the growth of bureaucracy. They have a sneaky way of getting around this. Every government department today is hiring part time and full time employees by the hundred from Office Overload agencies. The expenditure is up in the millions of dollars. The President of the Treasury Board tells us that they are cutting back, but they are using this back door method of hiring people from employment agencies. I will go into that at another time.
The E. P. FitzGerald report that was prepared for the Liberal party's "Way Ahead Program" points out:
The private sector requires to be given access to those areas where it can provide the maximum contribution in view of its flexibility and innovative capacity.
The present overlapping conglomerate of programs carried out by the various government departments, together with the under-utilization of skilled human resources in the public service, requires to be rationalized.
There is no question about that. There is tremendous duplication between federal and provincial governments. This is the first challenge that we should meet. I did not hear the hon. members discussing this on the television program

Sunday night. I heard nothing from the government about cutting out duplication.
The report continues:
The main goal here would be to minimize the waste of resources and ensure that the social levy quotient is administered with maximum effectiveness.
The potential for a positive management approach in the field of collective bargaining should be energetically pursued.
If hon. members opposite want to strengthen the committee system, this would be an excellent report to start to discuss all these points. One of the areas that I am particularly interested in-as are my colleagues in the Conservative party-is the reference in the report to reducing waste in government spending. The report goes into some detail as to how waste in government spending can be solved, as follows:
In the writer's view, based on consulting experience with a considerable number of government departments, the principal causes of waste or, more correctly, under-utilization of resources, in the federal Public Service, include the following:
(a)	Doubtful value of some programs.
(b)	Misuse of skilled human resources.
If you want to check back on previous speeches I have made, you will find I made reference to federal civil servants being paid $20,000 to $28,000 per year and claiming that they worked only about two hours a week. What are the backbenchers doing about this? They will do nothing.
The report goes on to read:
(c)	Excessive bureaucracy of the personnel administration system.
(d)	Dehumanization of the work content of routine jobs, e.g. compilation of pay.
(e)	Over zealousness in the secondment of senior line management on task force projects.
(0 Confusion as to the roles of Treasury Board, Public Service Commission and departments in the administration of programs.
(g)	Second language requirements for employees over 50 years of age.
(h)	Policy decisions taken by senior management which are properly the responsibility of the Liberal party.
If we are going to strengthen parliament and the committee system, this would be an excellent document with which to start. The Prime Minister says they have hundreds of them. I do not know why we need hundreds of them; they probably all say the same thing. Let us start with this one because the Prime Minister has his hands on this document.
A recent article entitled, "Debt Service Costs for Governments up 120 per cent in Five Years", an unbelievable record for the government, states the following:
The annual cost to the Canadian taxpayer of government debt has risen to $822.92 per person employed in the country, up from $444.44 five years ago.
These amounts represent the interest payments made on direct government debt in the fiscal year ending this month, compared with the 1971-1972 fiscal year.
Total debt service payments made out of tax revenues by federal, provincial and municipal governments during the past year amounted to $7.9 billion, up 120 per ce it from five years earlier.
This growth rate was much faster than the five year increase for the average weekly industrial wage (65 per cent) or the consumer price index (55 per cent).
April 5, 1977

The figures were obtained from Statistics Canada, federal Treasury Board and Bank of Canada publications.
The debt service costs reflect all interest paid on direct debt incurred by all levels of government in Canada.
All in all it is a very dismal record.
One of my main concerns and my colleagues' concern is the future of small and medium sized businesses which are being regulated to death, taxed to death, and swamped with government rules and regulations, but they are the backbone of Canada. Small is beautiful. This phrase sums up the heart of the fundamental political force of this decade-the fight against bureaucracy. This struggle which has dominated the political fabric of western industrialized nations, notably in the recent past in the U.S. and Sweden, is a battle not so much against government as for liberty.
The government does not appear to realize in any meaningful way that the survival of small business is linked to the survival of the mixed economy. Despite the fact that between 50 and 60 per cent of Canadians are employed by small and medium sized businesses, little more than half-hearted solutions have been produced by the federal government. The newly created Department of State for Small Business is seen by many as paralleling the Department of Multiculturalism which appeared briefly before the 1974 election as a sop to dissatisfied voters and then, the election having been won, vanished. After listening to the unsatisfactory answers of the Minister of State for Small Business (Mr. Marchand), one wonders how much longer he will last.
The Minister of State for Small Business cannot exist for long in a policy vacuum without succumbing to the same fate as his multicultural predecessor. What is needed is a strong and innovative small business policy which should consider very actively allowing tax credits for investment in small business; providing assistance in the formation of small business export consortia; changing government tender practices so that small businesses supply a greater portion of government purchased goods and services; and reducing the government paper work burden imposed on small business.
I understand the minister has announced he will be removing some of the paper work. We will be watching very closely to see if it happens.
The small and medium sized business sector cannot take much more official hesitation and vacillation. Government ministers and bureaucrats have only a short time left to learn that the problems of small and medium sized businesses are not just the problems of small businessmen but are the problems of Canada as a whole.
We in the opposition are criticized from time to time for not having alternative proposals, but I think one of the most positive questions we have asked is whether we really need 29 ministeries in Canada.


The Acting Speaker (Mr. Ethier):: Order, please. I regret to interrupt the hon. gentleman, but the time allotted to him has expired.
The Budget-Miss Campbell


Miss Coline Campbell (South Western Nova):: Mr. Speaker, may I take this opportunity to speak in the budget debate and to point out some of the measures which apply to South Western Nova. At a time when we asked people to restrain their spending and when we worked under the Anti-Inflation Board, we could not have expected a spending budget, much as I myself could see many areas of need in South Western Nova where money could be spent.
However, in these times when unemployment and business growth are problems facing any government, whether it be municipal, provincial or federal, we must look again at our priorities and reconsider where and how our dollars are being spent. This challenge, as I said, goes not only to governments but to the people and to business. Nothing should be spent without considering why we are spending the money and what it will create.
The anti-inflation program has been successful. It has kept the expectations of the Canadian people down and has allowed everyone to reconsider what are the priorities for Canada and what the mode of living of the people will be once the controls are lifted. In my opinion, the anti-inflation program has already been successful. The value of real income has risen strongly over the past 18 months. Wage settlements have come into line with the actual output of production. Certainly productivity is a word which seems to be returning to the vocabulary. One other factor has been that unions and workers are now emphasizing other conditions, such as working conditions, as an important part of a wage settlement.
The opposition is asking us on the one hand to spend, and on the other hand is criticizing us for spending and for creating inflation. We have to keep the rate of inflation down if we are to get a true picture of the Canadian economy.
I am pleased to see the value of the Canadian dollar decline. In South Western Nova we export most of our fish to other countries. The decline in the value of the dollar will help in the export of fish, as well as in other exports. The decline of the dollar will also help the tourist industry which is very important to the economy of South Western Nova and other areas in Nova Scotia. For whatever reason, whether it was the Olympics, the U.S. bicentennial or the increased value of the Canadian dollar last year, the tourist industry in South Western Nova and Nova Scotia certainly suffered. I hope that the decline in the Canadian dollar will encourage tourists to come back this year. I realize that Nova Scotia is an attraction on its own, but sometimes other incentives are needed.
As the Minister of Finance (Mr. Macdonald) has stated, this is a critical time. It is a time for us to persist in maintaining our efforts to lower inflation while we pursue steady growth in the economy. Capital investment is weak, and we need to improve our export markets as well as growth in business investments. This is a challenge not only to the government but also to the public. The programs we have under DREE, the Federal Business Development Bank and small business loans should all be utilized to the fullest extent,

April 5, 1977
The Budget-Miss Campbell
although I must put myself on record as being opposed to a great deal of the red tape small businesses, particularly in my area, must go through just to qualify or to see if they qualify.
I would like to discuss a few matters of concern to the east. With regard to energy, within the last few months the federal government has announced assistance to the governments of Nova Scotia and Prince Edward Island. This assistance was very much needed. People are being encouraged to take part in energy conservation by insulating their homes. I am still a firm advocate of looking to our renewable resources as sources of energy; however, I would like to see the establishment of an international grid system which would be controlled by the federal government and over which no one province would have control.
The sources of power at Churchill Falls, Gull Island and James Bay are the cheapest sources of power for the east, and they are the quickest to get at and use. Let us hope that the Maritime Energy Corporation takes strong action in this direction.
I do not wish to spend too much time on this, but I think that praise and thanks to the rest of Canada, which recognizes the plight of Nova Scotia and Prince Edward Island, are now due. I am sure that the eyes of most of the countries of the world are looking to see what will develop in terms of Nova Scotia's energy problem.
I would now like to turn to the matter of job creation. As the House is aware, I spoke last week on the unemployment insurance amendments contained in Bill C-27. I am pleased to note in the budget the additional amount of $100 million for job creation. This money can now go to create real jobs, and perhaps we should start by looking at the job creation program. I myself would like to see projects developed which will create jobs for the group which will be looking for extra weeks to qualify for unemployment insurance benefits and which will also be looking for work because of the decreased benefit period. This is what we consider the target group. This is the group which will be most affected by the unemployment insurance amendments contained in Bill C-27.
Let us hope that this $100 million will create real and long-lasting jobs. In addition, I think the public should be challenged to create new jobs. Perhaps there are people who have projects which, if provided funds for employing people, could be successful and create new jobs.
Although I am concerned about our unemployment problem, I must say that this government has been good for Nova Scotia, and particularly South Western Nova. During my brief stay here in Ottawa as a member of parliament I have seen changes. The Princess of Acadia has been taken over by East Coast Marine Services. It was initially purchased by the federal government in 1974 from the CPR, but in the fall of 1976 it was taken over by East Coast Marine. However, I have not seen the Bluenose replaced, and I am still hoping to see that. I realize that there have been difficulties in that another competitive firm has been operating out of Yarmouth to Maine. However, I did see the Marine Cruiser come in this winter when there was no other service to handle the heavy

traffic. I look forward in the near future to seeing a replacement for the old Bluenose.
I would like to mention the physical distribution centre. This is helping all businesses in the maritime provinces from its outlet in Moncton. However, we are still obtaining goods from Ontario and Quebec markets which are far too expensive. I look forward to seeing new ideas developed so that there can be a decrease in freight rates. Perhaps what is required is business people getting together, or perhaps counties or provinces should get together to try to bring freight rates down.
Again with regard to transportation, at Digby we have a new 3,000 foot airport. I call it an airport, although we are still looking for much more development. There is a 3,000 foot paved strip. This was brought about as a result of a joint effort by the municipality of Digby, the province of Nova Scotia and the federal government.
We are asked on many occasions to discuss at random different things at different times on different bills. I am pleased that the budget allows a member of parliament to discuss how government programs affect constituencies such as mine.
I look forward to seeing greater expansion of our fishing industry in our new 200 mile jurisdiction. We now have jurisdiction over the fishery, and I do not think other countries will allow us to waste this needed food resource. I hope our fishing boats will be able to harvest the fish and also that our plants will be able to process the catches. This is a great challenge to South Western Nova and to the rest of the province.
Other aspects of the fishing industry have been improved as well. In the summer of 1976 a building worth approximately $1 million, the Environment Building in Yarmouth, was opened. This building is part of the federal government program to bring needed services to the people. It will provide to fishermen and to the industry all the information required which, prior to this office being opened, had to be obtained from the Halifax regional office.
Wharves in South Western Nova are gradually being fixed up or replaced. There have been three multi-million wharves either started or opened during my time here as a member of parliament. They are at West head, Yarmouth and Meteghan. Work has been done in other areas such as Tiverton, Cape St. Mary, Pinkney's Point and Sluice Point, and I look forward to seeing wharves in other areas worked on this year.
On February 2, 1976, we experienced what was called the ground hog day storm. High tides and wind created a considerable amount of damage to existing wharves. Under an agreement between the federal government and the provincial government of Nova Scotia, the Emergency Measures Organization spent several million dollars in South Western Nova to help rebuild such areas as Westport and Freeport in order to re-establish the fishermen who suffered losses in the storm and to finance municipal, provincial and federal losses. The money certainly did not cover the total loss, but it was
April 5, 1977

intended to restore the economic balance of all the communities involved.
The Federal Labour Intensive Projects Program has been used at the two bases in my constituency. CFB Cornwallis received approximately $104,000 and CFB Barrington received approximately $24,000. The Minister of Indian Affairs and Nothern Development (Mr. Allmand) was able to provide last year, again under the Federal Labour Intensive Projects Program, the amount of $100,000 to help create seasonal employment at Kejimkujik National Park. This year a post office will be built in Clementsport. 1 am looking forward to programs for the Annapolis Valley Tourist Association coming forth to replace some of the industries that have suffered in the Annapolis area. These are just a few of the areas about which this government has shown concern.
I should like to return to the budget and speak of another area that I thought was a step forward. This measure was taken to encourage investment and regional growth. It was a recognition by this government that perhaps certain areas should be treated differently from the rest of Canada. We see this with the investment tax credit which will be extended for an additional three years at 5 per cent for most of Canada. The credit will be increased in slower growth areas designated under the Regional Development Incentives Act. Saskatchewan, Manitoba, northern Ontario and designated regions in Quebec will go to a tax credit of IVi per cent, while the Atlantic provinces and the Gaspe region will go to a tax credit of 10 per cent.


John R. Rodriguez: A useless policy.


Coline M. Campbell: I do not see it as useless, Mr. Speaker. I look forward in the future to more of this type of measure. If we are to keep Canada together we have to recognize that some areas need more help at times than other areas, and vice-versa. Perhaps hon. members who come from well-to-do areas will some day be in the same boat and need a little of that help.
There are other tax changes which I am sure are of concern to my area. The sales tax exemption for small manufacturers will be increased from $3,000 to $10,000. The government also intends to exempt certain producers of craft products which are of significance to Canadian culture and heritage. Consultation with the crafts industry will be necessary, we are told, before determining which groups will be exempted. Small crafts people in South Western Nova as well as Nova Scotia should be happy to hear of the sales tax exemptions, as will some of the culture and heritage crafts people.
Other measures and programs are going to be introduced to ease the cost of conversion to the metric system. This can only help small businesses in my area.
Income tax measures will be introduced to help working Canadians on modest incomes. Parents will be able to claim an additional $50 tax credit for each dependent child under 18 years of age resident in Canada, up to the maximum of $500
The Budget-Mr. Darling
which is the present limit. The employment expense allowance will be increased to $250, effective for 1977. At the present time it is 3 per cent of wage and salary income to a maximum of $150. These two measures combined will eliminate tax for a married taxpayer with two children earning less than $7,360, of whom there are a good many in my area, and for a married taxpayer with four children the ceiling will be $8,295.
Perhaps spending was restrained in this budget, Mr. Speaker, but there is a lot more in it that can help the people of Nova Scotia and South Western Nova if they wish to take advantage of government programs. They are invited to participate and help in the continuing fight against inflation, and also to look forward to the time when controls are lifted and to participate in growth and regional investment.


Some hon. Members:: Hear, hear!


Mr. Stan Darling (Parry Sound-Muskoka):: Mr. Speaker, I should like to begin my remarks by congratulating the Minister of Finance (Mr. Macdonald) on his decision to step down at an early date as I understand that this is his last budget. One look at the budget is enough to convince most observers that the minister has waited too long to step down. With the largest cabinet in the history of Canada, and indeed the largest cabinet in any country in the western world, it is becoming more and more difficult for reasonable and intelligent Canadians to believe that this budget is the best that our government can produce. Surely 32 cabinet ministers and a veritable army of bureaucrats and economic experts can come up with a better budget than this thing we are debating today.


John R. Rodriguez: What about Darcy McKeough?


Stan Darling: I hear my shy and bashful friend from Nickel Belt asking about Darcy McKeough, but I understand his budget has not been presented yet.


John R. Rodriguez: It is going to be a carbon copy.


Stan Darling: We will see what comes from it. We are debating the budget that was brought down on Thursday evening, and in all frankness I think we would have been wiser if things had been reversed and those of us who wished to make suggestions had been able to do so prior to the budget. Maybe the minister would have taken some of our suggestions rather than just going his own sweet way with his bureaucrats and officials conjuring up the present budget.
One of the first remarks I heard when the budget was being read was that it certainly did not sound like an election budget. We can be sure of that, despite the Prime Minister (Mr. Trudeau) announcing this afternoon that six by-elections will be held on May 24, Queen Victoria's birthday. Neither is this a budget that will provide jobs for the more than one million unemployed. It is not a budget that will inspire the confidence of investors, and it is not a budget that will get our sluggish economy moving again. Those are the things that we have been expecting in a budget, things that are badly needed, and yet provision was not made for them. I have to ask, then, what was the point in tabling a budget in the first place?
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I think the Leader of the Official Opposition (Mr. Clark) put his finger on the real purpose of this budget when he labelled it a survival budget-but not the survival of the working people of our country, nor the survival of our traditional way of life. It was surely nothing more or less than the survival of the government for the time being.
The Minister of Finance said that the government would be compelled to borrow an additional S6V2 billion in the coming year to finance the provisions in this budget. I think that is the real nub of this budget. When you weigh the advantages in this budget against the cost to the people, it is easy to see that it is directed at the welfare of the government rather than the welfare of the people.
The government even plans to rob the dead in order to raise a few more pounds of flesh, Mr. Speaker. It is pretty difficult for the dead to rise up and speak out against the ravages of this hungry and rapacious government, and the Minister of Finance knows that on that score he is on firmer ground with those who are grief-stricken by the loss of a loved one. I am speaking of the government's plan to tax the proceeds from insurance policies. Insurance policies on individuals are intended to pay the cost of the funeral of the deceased and to help ease the financial plight of those left behind. Traditionally these insurance benefits have been left alone by all previous governments, but not by this government. This government can spot a good thing when it sees it, especially if there is a chance to grub a few more dollars from the Canadian taxpayers. I think in that particular measure we have reached the low point in taxation policy, Mr. Speaker. The Minister of Finance, however, missed another good deal when he was searching for new ways to raise ready cash for his spendthrift departmental bureaucrats. He overlooked the fact that many people have gold teeth and bridgework. I believe one other government tried to raise money by that horrible procedure.
There is another kind of taxation which makes me wonder how far the government will go in taxing our people. It is something that was left out of rather than included in the budget. I had hoped to find provision in the budget for the removal of that insidious ten cents per gallon federal tax on gasoline-that extra tax imposed on gasoline in July, 1975. Answering a question I asked a few days ago, the Minister of National Revenue (Miss Begin) told me the government has raised $1,025,570,000 from that ten cents per gallon gasoline excise tax during the past 15 months. Since this is money the government had not collected previously, it must be considered as gravy. Why then should it be necessary to try to grub additional money through taxes at this time, by taxing proceeds from personal insurance policies and life insurance policies?
To begin with, the gasoline taxes impose an extra and unnecessary burden on those same people, those in the lower income brackets, because many people must use their automobiles to get to and from their jobs. Those people seem to be the first target of the Minister of Finance when he is instructed to

raise more money. In the case of the gasoline excise tax, the government has raised over $1 billion.
There is another side to the extra tax on gasoline. It discourages people from travelling in their own country and discourages people in the United States from driving to Canada for their vacations. My own area, Parry Sound-Mus-koka, depends to a large extent on tourism to balance its economy over the year. When tourism in Canada suffers, especially in Ontario, my area suffers. Mr. Speaker, I find myself fighting against stupid government policies at the same time as I try to encourage tourists to come to Parry Sound-Muskoka. It actually appears to me at times as if the government is doing everything it can to make it difficult for tourism to flourish in this country, or even survive. I believe figures for 1976 show that Canada had a deficit in tourism of over $1 billion. Even though we are considered as an important tourist area and have attracted people from the United States as well as from other parts of the world, we ran up that huge deficit.
Speaking of tourism, let me be parochial and speak of a letter which was referred to in a weekly newspaper, the Haliburton County Echo of March 30, 1977. The letter referred to was written by Mr. George Tawse-Smith, director of marketing for the Canadian Office of Tourism. It was a form letter which had been sent to American Fishermen, and was addressed to "Dear Angler". The letter for the first two pages explained the many advantages of coming to Canada, to go fishing. It then went on to say, as reported in the newspaper, the following:
... "Canada offers the fisherman such a vast choice, it's hard to decide where to go. Let me make a suggestion ... just across our neighbourly border lies the finest fishing paradise you could imagine-in "La Belle Province du Quebec".
The letter then goes on for a further page to expound the fishing advantages of the province of Quebec.


Some hon. Members:: Hear, hear!


Stan Darling: I have no quarrel with the tourist industry, or with the fishing industry in Quebec. I am told there are many other parts of Canada where the fishing is just as good and, to me, that letter was discriminatory. I point out that the department responsible for tourism is responsible for attracting tourists to Canada, but not to any one particular spot in Canada. It is up to individual provinces to do their best to invite tourists, and to make particular areas within provinces as attractive to tourists as possible.


An hon. Member:: There is great fishing in Hamilton Bay.


Stan Darling: Yes, but can you eat the fish?


John R. Rodriguez: We have lots of good fish in Nickel Belt.


Stan Darling: I hear the Red Baron of Nickel Belt saying there is good fishing in his area. Mr. Speaker, there is good fishing in Parry Sound-Muskoka, and in many places in northern Ontario.
Along with tourism, one of my major areas of interest is small business. Mr. Speaker, small business provides more
April 5, 1977

than 50 per cent of all jobs in Canada. That is why I find it difficult to understand government policy on this important sector of the Canadian economy. Although it must be admitted that this budget makes a start in the direction of recognizing the importance of small business, it falls far short of doing what it needed. For one thing the budget is worded in such a way that the government can squirm out of its commitments in this case, just as it did with the budget of the Minister of Finance ten months ago. A number of promises in the last budget were not honoured, and others were implemented in a different way than we had been led to expect. 1 am afraid that some of the fuzzy and nebulous provisions of this budget for assisting small business will end up on the cutting room floor.
The time lag between the tabling of the budget and legislation flowing from it is such that the government can dream up all kinds of excuses, and usually does. Sometimes we are told that, in the meantime, things have changed and measures proposed in the budget are no longer appropriate. Therefore we get nothing. On other occasions we are told there is no money to implement other proposals in the budget, and again we end up with nothing. Or at best we get a watered down version of what we were led to expect. The plain fact is that we must stop spending billions of dollars on patched-up measures and put the money where it will produce long-term employment.
A few thousand people in Canada will be pleased to learn that they have been selected to participate in Canada Works and Young Canada Works projects, and that they will be able to work for a couple of months and make a few hundred dollars. For people who simply cannot find any kind of job, it is better than nothing at all. For that reason alone I can go along with the expenditure of $452 million in the coming year for make-work projects. However, I know that most if not all of those recipients of Canada Works and Young Canada Works funds feel as I do, that it would be better if they could look forward to long-term, career-type jobs which could enable them to plan their lives instead of living from one federal ad hoc job-creation plan to another. How can any young couple possibly plan to set up a home and raise a family when all they can look forward to is a couple of months of work now and again on something like a Canada Works project?
I could say so many things concerning the government's failure to come to grips with unemployment that 1 could use all my allotted time just in talking about that. But I do not want to make the same silly mistake the Leader of the New Democratic Party (Mr. Broadbent) made. If I spoke for the next 24 hours, I would not create a single new job. But the leader of the NDP tries to make us believe that he can create one million new jobs by talking through what would normally be the Easter recess. Obviously, it is not only the government that is mixed up.


Some hon. Members:: Hear, hear!


Stan Darling: Back in March, I think March 22, I asked the chairman of the board of Central Mortgage and Housing Corporation, William Teron, if he would try to convince the
The Budget-Mr. Darling
government that it would be a good thing to remove the remaining 5 per cent federal sales tax on building materials. Mr. Teron said he would not even consider it. His argument was that the reduction by 6 per cent when the tax had been 11 per cent, had not filtered down to the consumer and he did not believe that removing the remaining 5 per cent would benefit the consumer either. That was a poor argument. Actually it is a cop-out. Mr. Teron was in the building business back in the days when Walter Gordon imposed the 11 per cent federal sales tax on building materials. I think it was done around 1965. Mr. Teron knows full well what the result of that tax was at that time.
Canada had been experiencing a building boom, and people who had never thought they would be able to afford one were moving into new homes. Mr. Teron knows that the original 11 per cent tax filtered right down to the home buyer. Actually, by the time it got to the buyer the increase was not 11 per cent, but about 17 per cent. He is saying, then, that it is easy to pass along an increase to the consumer, but not possible to pass a decrease along to the consumer. I do not accept that, Mr. Speaker. I doubt very much if Mr. Teron has ever met with the Minister of State for Urban Affairs (Mr. Ouellet) and the Minister of Consumer and Corporate Affairs (Mr. Abbott) to see if either the original 6 per cent cut or a further 5 per cent decrease in tax could be passed on to the consumer.
I can say one thing about it. The consumer will not get the benefit of federal action to bring about such a decrease in taxes unless someone in government is interested enough to ensure that the consumer does get a break.
There is another matter 1 would like to see in the budget and that is an extension of the program whereby the federal government assists homeowners with grants in order to install insulation in their homes to save fuel. This program operates only in Prince Edward Island and Nova Scotia. I do not like my area of Parry Sound-Muskoka being left out of this program. I am not being entirely parochial in this, although I might admit a wee trace of parochialism. The plain fact is that it gets pretty darned cold in my constituency in winter. We pay a higher price for heating oil than some areas further south. There would certainly be some justification for extending this program throughout northern Ontario. Do you hear that, Mr. Nickel Belt?


John R. Rodriguez: Hear, hear!


Stan Darling: I would be interested in hearing a few words in support of this from some of the more vocal members from northern Ontario as well as from the other northern areas of Canada. I am sure that the mercury sometimes drops in the west as well.
We in the Official Opposition would have liked to have seen some reductions in income tax, and possibly some reductions in federal sales tax. I know you would probably then have the makings of an election budget, but so what? Do we always have to wait until the government feels secure enough to call a
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April 5, 1977
The Budget-Mr. Darling
general election before we can expect tax relief for the lower and middle income wage earners?
The millions of people who are on fixed incomes, those who live on retirement incomes and those on old age security, are the people who would benefit most from a reduction in federal sales tax. However, they are not represented by powerful unions or lobbying groups. They are voiceless, and so they are powerless.
Before I conclude my remarks I would like to refer to my earlier comments on small business and the critical need at this time for legislation that would improve the economic climate in our country for this vital sector of the Canadian economy. I know that the budget proposes several measures that are designed to stimulate interest and support for small business, but the budget does not even begin to face up to this problem. What is needed here is direct, not indirect, assistance to the small business community.
It is interesting to note that at one point in the budget the government proposes direct job creation with massive support for Canada Works and Young Canada Works. Later in the budget we find indirect support in the way of tax credits and deferrals for small businesses, that segment of the economy which accounts for more than 50 per cent of the long-term jobs in this country.
1 do not know how many times I have mentioned in this House that we need a small business administration in Canada that will have no other function or responsibility than to support small businesses in the ways they so badly need support. These areas can be listed as informational, advisory, and financial. This has been done for many years in the United States. If it works somewhere else, why not here?
The small business administration that I envisage would provide up-to-date information on market conditions for a given product or service in the small business sector. It would provide advice on all aspects of starting up a business or improving the operation of an established business. Third, and perhaps most important, it would provide direct access to loan capital to start up a new business or expand an existing business.
I know the government will say there are already programs that will accomplish these things. However, while we have a number of separate and unconnected programs in this area, there are none that provide real assistance to the small businessman or woman. The guaranteed loan program whereby prospective borrowers go to a bank and apply for loans at a couple of percentage points lower than the market rate is unrealistic and unworkable. In the first place most banks do not care as much for the government guarantee as they do for the additional two or three percentage points they would get on a conventional loan. In most cases they would be getting a guarantee from the borrower equal to that offered by the government.
I have heard of cases where an association between a bank and a customer of long standing has been damaged because the customer felt he had a right to the low interest loan. The
[Mr. Darling.)
bank manager felt that he was not entitled to it. Some arguments of bank managers are lame, to put it mildly.
I know of cases where businessmen have been told that their credit was too good, their security was fine and therefore they were not entitled to such a loan. But businessmen who had been customers of banks for a good many years were able to obtain loans at the more attractive rate 20 or 30 miles away. As a result, they transferred their accounts.
While this budget may provide some things, there are certainly many it does not provide. At the present time we have an $11 billion trade deficit. That is frightening. I have been told that a billion dollars of Canadian capital will be going from this country to other countries. It is frightening when our own investors do not have enough confidence in Canada or the present government to invest their money here.
The Canadian taxpayer is paying through the nose. A Canadian family pays 20 per cent of its personal income in taxation. The American equivalent is about 14 per cent. I admit that comparisons are odious. However, when we are constantly shown how much more attractive it is to invest in the United States, we wonder why a great many more people, whether they are students or not, do not take the advice of the Prime Minister when he said that if you do not like it here or cannot find a job here, you can move to another country.


Mr. Mike Landers (Parliamentary Secretary to Minister of Justice):: Mr. Speaker, the country appears to be suffering from an economic ulcer. Members opposite seem panicky and almost invariably would recommend an immediate operation to cut out the peptic ulcer-and half the stomach with it. However, our Minister of Finance (Mr. Macdonald) did not panic. Essentially what he has done is to put the country on a bland budgetary diet. If this cure does not heal the economic ulcer, I feel confident that my government will know what type of medicine to prescribe in its next budget, which will be an election budget.
During the month of February this year it was my good fortune to be an invited guest of the staff and residents of Fundy Hall, the Canadian National Institute for the Blind facility in Saint John, New Brunswick. During my two hour visit to Fundy Hall, the residents and staff made me aware of some of the problems facing people who are visually handicapped. The notes I have before me today represent the collective experience of a number of visually handicapped people, that is to say, a small group of sightless and partially sighted people made the verbal snowball that is in my hand. On behalf of all visually handicapped Canadians, I will now proceed to throw it.
In relation to employment with the public service, it is a fact that very few visually handicapped people are employed by the Public Service Commission of Canada. Many sightless university graduates complain, and rightfully complain, Mr. Speaker, that they experience great difficulty being seriously considered for employment by the federal government. This
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complaint is supported by the fact that of over 550,000 federal government employees, only about 50 are registered blind persons. Instead of setting an example for business and industry to follow, the Public Service, the largest employer in Canada, makes little effort to appoint well qualified sightless persons to positions of responsibility. This failure on the part of the Public Service Commission infringes on the rights of the individuals concerned and undermines confidence in the integrity of public officials who have an ethical obligation to make the optimum use of human resources.
Hopefully, Mr. Speaker, this problem will be altered by the passage of the human rights act which prohibits discrimination on the grounds of physical handicap in matters related to employment. The Minister of Justice (Mr. Basford) and the Government of Canada are to be commended for their initiative in this regard. The human rights commission will further alleviate the present imbalance through the use of affirmative action programs.
Partially sighted people complain that when they go to apply for a position with the Public Service Commission the print is so small on the application form as to be obscure even to a person who is not visually handicapped. Surely it would not be an undue imposition on government to make it a requirement that employment application forms be in large, bold type.
In relation to income tax returns, Mr. Speaker, the question was put to me: "Why cannot they be made available in Braille"? The Minister of National Revenue (Miss Begin) is a kind and thoughtful person and I prod her to examine this worth-while question in an effort to ensure that in 1979, when sightless persons are filling out their tax returns, their fingers will be able to act as their eyes. Surely this particular request meets with all the standards of fairness and reasonableness that average Canadians would normally apply. Although volunteers are usually available to assist sightless people in filing their income tax returns, a number of these individuals would prefer to do it themselves. Nowadays when you are fortunate enough to find someone who wants to do something for himself or herself surely the government should not impede or retard an attitude that is rapidly becoming extinct.
Once the Braille income tax returns become available and are filed, they could be processed by sightless taxation information officers employed by the Department of National Revenue for this purpose. Surely even the opposition members can see the benefits of such an affirmative action program.
In relation to paper currency, Mr. Speaker, on July 8, 1976, I put a question to the Prime Minister (Mr. Trudeau) in this House. I raised a proposal to print paper money with raised bumps on one corner to aid sightless people in readily distinguishing the various denominations. Holland and Switzerland have already taken this initiative. An alternative suggestion is that the Bank of Canada vary the size of the printed note according to value. Many European countries have taken this particular initiative. When this matter was first raised, the Prime Minister seemed incredulous that anyone would cheat a sightless person. The visually handicapped people of Fundy Hall assured me most emphatically that people still prey on
The Budget-Mr. La Salle
and cheat their fellow human beings whose abilities in relation to sight are impaired.
In relation to housing, at present the Central Mortgage and Housing Corporation housing program is not flexible enough to meet the needs of sightless people. The co-op housing program is an example; co-op housing developments are usually located in subdivisions far from the centre of town, making accessibility to necessary amenities difficult for the sightless person. Furthermore, a program of this nature requires sweat equity, once again making it infeasible for sightless people to participate.
Generally, very little consideration is given by Central Mortgage and Housing Corporation to sightless and handicapped people. Rather than making it difficult we should be giving them an incentive to get out of institutions and public housing and to take pride in the accomplishment of achieving home ownership. Perhaps the solution to this is a reduced mortgage over a longer period of time, or a special grant for the sightless and handicapped.
In relation to airlines, Mr. Speaker, the only common complaint is that they do not provide a reduced rate for sightless passengers travelling with escorts. Visually handicapped persons often travel to larger centres for medical attention and require an escort to be with them in the unfamiliar community. It is my submission that sightless people and their escorts should each travel on Air Canada and other airlines at a 50 per cent discount. It is presently CNR's policy to give a 50 per cent discount to a sightless person travelling with an escort.
Althought I raised this particular subject matter in my maiden speech in 1974, the government has not seen fit to embrace the proposal. Well, Mr. Speaker, I shall continue to prod the government in this regard until my proposal is not only embraced but adopted. This particular proposal could be amended to include all physically handicapped people who require escorts when travelling. Having thrown this verbal snowball prepared by the visually handicapped, I implore my government to grab it from mid-air and head for the goal line with it.
[ Translation]


Roch La Salle: Mr. Speaker, I regret that I have only a few minutes left tonight. However, I suppose that my friends opposite are not unhappy about that. Still I have something to say about the budget which, according to the comments of some ministers and other government members, had led us to entertain some illusions that have been quickly dispelled. We have noted much more disappointment among the Canadian people. It is clear that a few goodies were offered to the taxpayers, taking in consideration the very difficult economic conditions. The Minister of Finance (Mr. Macdonald) himself said some time ago that the economy was sick. We have known this for a long time and after the efforts he made to bring down his budget in the House, after ten years of efforts on the part of the government, we must unfortunately say that these results have failed miserably.

April 5, 1977
The Budget-Mr. La Salle
These results are due to a complete lack of leadership or insufficient leadership, which of course creates a very unfavourable climate for investment, and therefore a lack of confidence on the part of the population. But the government accuses Canadians of living too high off the hog without realizing, for instance, that 48 per cent of the gross national product is spent by the government itself. We should reflect seriously on this.
The government has made many studies and analyses. It has created various agencies to make recommendations to the cabinet or the government, but this has resulted in the present situation. This places us in a serious difficulty concerning competition with neighbouring countries, with whom we must have trade relationships.
Since trade is increasingly difficult and decreasingly competitive, the government often states that, in view of frozen wages, it is once again the workers who must support the burden of the present situation. I believe we should seriously examine only the income of senior executives. Then we should not have the tendency always to criticize the increases requested by ordinary workers. Even if these increases have been requested, I believe we should consider how the government refused to fight inflation when it was time to do so.
Of course, it now boasts that it has succeeded in partly controlling inflation. I believe that many others than the government or its experts, and especially the Minister of Finance, can claim responsibility for the action taken. I have in front of me the hon. member for Halifax (Mr. Stanfield) who long ago forecast the difficulties that this government would meet. But the government refused to listen to him and tried everything to ridicule him and to make the public believe that his recommendations were senseless.
Today we have come to realize that the government was compelled to do an about turn around, and if it had any success, it did not invent that instrument to partly reduce inflation because the idea came from our former leader on this side of the House.


An hon. Member:: Oh, oh! Not again!


Roch La Salle: I know it does not please my friends opposite if we remind Canadians of the control policy. If the answer suggested by the hon. member for Halifax had been applied, I mean the 90 day freeze period, I think that this government would not have been compelled to deal with problems on a day-to-day basis, according to the circumstances but it did not want to adopt that important part of our program. But eventually it had to apply, for the most part, the program suggested by us. We had proposed an 18 month freeze period and I think we were right. Today, this government, not having obtained the public confidence it needed, does not feel able to start a decontrol process. The minister answers: I want to be sure of cooperation from the provinces, labour, the business community, but I do not think that he will gain their confidence with that kind of budget.
I would like also to encourage this government to undertake a serious selection and analysis of its programs. As I said
(Mr. U Salle.]
earlier, a series of analyses and studies has been made and we know their results, that is the lamentable economic failure of this government. May I invite it to study and reevaluate the services of Statistics Canada?
For example, about the objectives of the Minister of Regional Economic Expansion .(Mr. Lessard) aimed at eliminating difficulties stemming from regional inequalities, were those objectives reached? Far from it, and at what cost, Mr. Speaker!
Should the Minister of Finance also be invited to examine the additional costs incurred in the administration of his department? And those astronomical costs also bring results that make us tremble and disappoint us as well. I heard one of my colleagues say during the weekend that if private enterprise had such administrators, considering this budget and its results, that industry would not take long to fire them in view of the poor results they are showing. I would like to point out, Mr. Speaker, that it is now time to vote.


Mr. Deputy Speaker:: Order. It being now 9:45 p.m., it is my duty pursuant to the provisions of Standing Order 60(6) to interrupt the proceedings and put forthwith any question necessary to dispose of the sub-amendment now before the House.

The question is on the amendment to the amendment. All those in favour of the amendment to the amendment 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.
And more than five members having risen:


Mr. Deputy Speaker:: Call in the members.


Mr. Speaker:: I declare the amendment to the amendment lost.
It being after ten o'clock, this House stands adjourned until 2 p.m. tomorrow.
At 10:15 p.m. the House adjourned, without question put, pursuant to Standing Order.

Wednesday, April 6, 1977