1977-02-22

OFFICIAL REPORT


[Stage Direction]
26 Elizabeth II

[Stage Direction]
Published under the
authority of the Speaker of the House of Commons by the Queen's Printer for Canada
Available from Printing and Publishing, Supply and Services, Hull, Quebec, Canada K1A 0S9
[Stage Direction]
Tuesday, February 22, 1977


Mr. Benno Friesen (Surrey-White Rock):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. In view of the fact that many government programs and grants are developed and awarded each year to help varying educational projects, and in view of the limited publicity given to the existence of such programs and awards and that therefore, many individuals, educational groups and institutions as well as school boards, are not even aware of the existence of such programs and grants and therefore cannot benefit from them, 1 move, seconded by the hon. member for Okanagan-Kootenay (Mr. Johnston):
That each government department responsible for such programs and grants be required to send written notice of them to every school board and post-secondary institution in Canada giving full details of the programs and grants requirements and application procedures.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


REQUEST FOR TABLING OF AGREEMENT AND SAFEGUARDS FOR SALE OF NUCLEAR REACTOR TO ARGENTINA-MOTION UNDER S O. 43
Mr. Andrew Brewin (Greenwood):: Mr. Speaker, I rise on a motion, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity. It has been reported that Atomic Energy of Canada has completed the sale of a CAN DU reactor after renegotiations with the Argentine government which has produced a total loss of between $20 million and $40 million. It is essential that the people of Canada be reassured that adequate safeguards against the production of nuclear weapon material be accepted by the
Argentine goverment. I therefore move, seconded by the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas):
That this House direct the government to table all records of the agreement and particularly records of safeguards negotiated to prevent the use of the materials produced by the CAN DU reactor for the development of nuclear bombs.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


PROPOSAL TO MAINTAIN DAYLIGHT SAVING TIME TO CONSERVE ENERGY-MOTION UNDER S O. 43
Mr. Eudore Allard (Rimouski):: Mr. Speaker, pursuant to Standing Order 43, I seek the unanimous consent of the House to move a motion on a matter of utmost importance for the future of Canada.
Considering that Canada will very likely be faced soon with a serious shortage of oil and natural gas, that it uses a considerable amount of oil, a non-renewable source of energy, and that it is not as rich in black gold as it thought it was in 1973,1 move, seconded by the hon. member for Roberval (Mr. Gauthier):
That the House strongly urge the federal government to hold as soon as possible a federal-provincial conference of energy, mines and resources ministers to agree on a formula which would make it mandatory for all Canadian provinces to maintain daylight saving time throughout the year, a formula which our southern neighbours have found to be highly profitable.


Mr. Speaker:: Order, please. The House has heard the hon. member's motion. Pursuant to Standing Order 43, this motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Speaker:: There is not unanimous consent; the motion therefore cannot be put.

February 22, 1977
Labour Conditions



PENSIONS


Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, pursuant to Standing Order 43, I rise on a matter of urgent and pressing necessity. Considering that it has been estimated there may be already $400 billion of unfunded liabilities in Canada arising from governmental commitments under pension plans and bearing in mind the fact that the Canada Pension Plan will cross a threshold on or before 1982 at which time benefit payments will exceed tax income, I move, seconded by the hon. member for Hamilton West (Mr. Alexander):
That there be an immediate reference to the Standing Committee on Finance, Trade and Economic Affairs to determine what in fact is the aggregate pensions commitment outstanding at all levels of government, to what extent these commitments are funded and to what extent they will become a burden on future taxpayers.


Mr. Speaker:: Such a motion can only be presented with the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: No!



LABOUR CONDITIONS


Mr. John Fraser (Vancouver South):: Mr. Speaker, I too rise on a matter of urgent and pressing necessity pursuant to Standing Order 43. My proposed motion arises from a statement by the Minister of Labour on Saturday that the government was forging a new, accommodating arrangement with labour. In view of the fact that labour has consistently refused to return its representatives to the Canada Labour Relations Council and the Economic Council or to accept the minister's multipartite national forum, and, further, in view of the fact that Mr. Joe Morris, President of the CLC, has now publicly repudiated the minister's statement and reiterated labour's claim that they were, and I quote, "sold down the river" by the Liberal government, I ask leave to move, seconded by the hon. member for Dauphin (Mr. Ritchie):
That this House direct the Minister of Labour to appear before the Standing Committee on Labour. Manpower and Immigration to explain fully the basis for his statement and explain to the committee why it has been so swiftly contradicted by the President of the CLC.


Mr. Speaker:: Such a motion can be presented to the House only with unanimous consent. Is there such consent?


Some hon. Members:: No!



AIR TRANSPORT


Mr. Paul Yewchuk (Athabasca):: Mr. Speaker, I rise under the provisions of Standing Order 43 to move a motion on a matter of urgent and pressing necessity. My motion relates to the ruling by the Supreme Court of Canada in favour of the right of the government of Alberta to purchase Pacific Western Airlines. I move, seconded by the hon. member for Edmonton Centre (Mr. Paproski):
That a spokesman for the government state on motions today whether the government accepts the decision of the Supreme Court or whether it intends to bring in the contingency plan of the Minister of Transport to introduce retroactive legislation, and whether the government proposes to rescind the order in council preventing the move of the head office of Pacific Western Airlines to Alberta.


Mr. Speaker:: Presentation of such a motion can be made only with the unanimous consent of the House.


Some hon. Members:: No!



ATOMIC ENERGY CONTROL BOARD


Mr. Cyril Symes (Sault Ste. Marie):: Mr. Speaker, I seek to move a motion under the terms of Standing Order 43. In view of the fact that the start of clean-up operations affecting about 200 homes in Elliot Lake which show unacceptable levels of radiation has been delayed as a result of the government's refusal to allocate the necessary funds to the Atomic Energy Control Board, claiming the board has no responsibility for natural occurrences of radiation, and bearing in mind the negligence of AECB in failing to check the site before these homes were constructed, I move, seconded by the hon. member for Brant (Mr. Blackburn):
That the government recognize its responsibility to fund the remedial action necessary to protect the health of Elliot Lake residents.


Mr. Speaker:: Such a motion can only be moved with the unanimous consent of the House. Is there such consent?


Some hon. Members:: No!



ORAL QUESTION PERIOD


Mr. Speaker:: The hon. Leader of the Opposition.
February 22, 1977


Some hon. Members:: Hear, hear!


Mr. Joe Clark (Leader of the Opposition):: Mr. Speaker, I should at the beginning express my appreciation to the party on the other side for all the help they have given me.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: My question is addressed to the Minister of Energy, Mines and Resources who yesterday tried to evade his government's responsibility for a national inquiry into nuclear power. 1 should like to draw the minister's attention to one of the statutes of this parliament which governs his own activities, the Atomic Energy Control Act, which states quite clearly that "it is in the national interest to make provision for the control and supervision of the development application and use of atomic energy". In light of that clear mandate in a statute of this parliament, will the minister now tell this House whether the government of Canada intends to slough off this critical national responsibility to the province of Ontario, or whether the government will honour its responsibilities to the thousands of Canadians who are vitally concerned about this power source and at the same time honour its commitment to its own party in national assembly?


Hon. Alastair Gillespie (Minister of Energy, Mines and Resources):: Mr. Speaker, perhaps I could take this opportunity of congratulating the hon. member on his first anniversary.


Some hon. Members:: Hear, hear!


Alastair William Gillespie: We look forward to future years when he will be on that side and we will be on this side of the House.


Some hon. Members:: Hear, hear!


Mr. Paproski:: Don't you believe it.


Mr. Hees:: You are all mixed up, Alastair.


Alastair William Gillespie: I am not sure, Mr. Speaker, whether the opposition are serious about the question or whether they are so overcome with goodwill on this occasion that they do not want an answer.
Let me make it quite clear that I consider the question of nuclear energy, the benefits and the risks, an exceedingly important one. That is why I was particularly pleased when the Porter royal commission interpreted its terms of reference in a very much wider way than they were first given to the commission, so wide in fact that they engaged in a public dialogue and debate respecting the benefits and risks of nuclear energy; and that is now in motion. I think it is also important that hon. members understand that Ontario, far more than any other province in this country, is committed to generating, and indeed is generating, its electricity from nuclear power today. Probably one-fifth of the lights in this room derive their electricity from nuclear generated power.
The question that is surely before us is: What is the best way to go about examining the potential, the benefits and the risks,
Oral Questions
and to deal with the apprehensions of the Canadian people or those who may have them? 1 believe that one of the most important ways is to support the report of the royal commission of the Ontario government. I also believe there are a number of other things that we can do. I believe that the Atomic Energy Control Board needs to be beefed up. I believe that its terms of reference-


Mr. Speaker:: Order, please.


Charles Joseph Clark: Mr. Speaker, I was hoping that in that long list the minister might finally come to a public inquiry, either held by a standing committee of this parliament or by some other agency, which would ensure that the national responsibility which is set out in law would be honoured and exercised by a national agency, instead of ducking behind the work of a province. May I ask the minister quite specifically and simply: will he establish a national public inquiry into this question; or, alternatively, will he make a reference to a standing or special committee of this House to look into the question?


Alastair William Gillespie: Mr. Speaker, I was very clear in my answers yesterday: if the hon. gentleman can show how such an inquiry would not duplicate an already good inquiry being undertaken by the province of Ontario, I would be prepared to consider that.


Charles Joseph Clark: A supplementary question, Mr. Speaker. We now have a willingness to consider. We will provide the demonstration and we will then ask the minister not simply to consider it but act on it. The point I want to make now-


Alastair William Gillespie: Oh, oh!


Charles Joseph Clark: -I have read the minister's answer and have listened to his answer as to whether or not-


Some hon. Members:: Oh, oh!


An hon. Member:: Take it easy!


ACCEPTANCE OF PROVINCIAL STUDIES AS BASIS FOR FEDERAL ACTION
Charles Joseph Clark: The Minister of Energy, Mines and Resources is embarking upon a very serious precedent as to whether he is prepared to accept the work of a royal commission established in a province as being an adequate substitute for the national government or national institutions carrying out a responsibility that is set out in law as applying to the national government. I should like to ask the minister whether it is going to be the continuing practice of this government in the energy field or otherwise to accept work carried out under provincial jurisdication as a substitute and an excuse for not acting within its own responsibility.


Some hon. Members:: Hear, hear!

February 22, 1977
Oral Questions


Alastair William Gillespie: Mr. Speaker, that seems to me like an absurd question.


Some hon. Members:: Hear, hear!


An hon. Member:: For an absurd minister.


Alastair William Gillespie: Surely, a moment's reflection would have convinced the hon. member that in this country we are too often involved in duplicating the work of the provinces.


Some hon. Members:: Hear, hear!


Alastair William Gillespie: Surely, the time has come to support our arrangements so that the federal government can do certain things and we in the federal government can use the useful work done by the provinces.


Charles Joseph Clark: A final supplementary question, Mr. Speaker. Since we now have an expression of the view of the government that they want to use the work of a provincial agency, may we have an undertaking from the minister that the government is prepared to consider the reports of the Porter inquiry and act upon its recommendations, consider them with the same seriousness and act upon their recommendations in the same way, as they would a royal commission or any other agency established under their own jurisdiction.


Alastair William Gillespie: Mr. Speaker, I think I have made that clear all along. We are looking forward to the work of the Porter commission.


John Allen Fraser: Will you follow its recommendations?


Alastair William Gillespie: Of course, we would want to use the information provided.


Some hon. Members:: Hear, hear!


SALE OF NUCLEAR REACTOR TO ARGENTINA-AMOUNT OF LOSS ON RENEGOTIATED CONTRACT
Miss Flora MacDonald (Kingston and the Islands):: Mr. Speaker, my question is also for the Minister of Energy, Mines and Resources. It arises from reports that Ross Campbell, chairman of AECL, has finally signed a renegotiated contract with Argentina and that the anticipated loss is now between $23 million and $40 million. In view of the fact that AECL officials have given themselves a margin of error of a mere 100 per cent in counting up their losses, will the minister tell the House how he is so sure that these losses will not exceed $40 million, $50 million or $60 million? What is the upper figure?


Alastair William Gillespie: Mr. Speaker, the hon. lady has already indicated what the upper figure is. That, if I understand it, is $40 million.


An hon. Member:: Plus 100 per cent.


Alastair William Gillespie: I do not know what further information the hon. member wants. All I can tell her is that I think Mr. Campbell was able to negotiate a good deal for Canada.


Some hon. Members:: Oh, oh!


An hon. Member:: I would hate to see a bad deal.


Alastair William Gillespie: Any time the opposition can show me how they can save $75 million I would like to hear it.


Mr. Fairweather:: April Fool's Day is not here yet.


Flora Isabel MacDonald: A supplementary question, Mr. Speaker. All I can say is that the $40 million loss which the minister is looking upon as a benefit he is liable to turn over to the provinces in due course along with the other matter.


Some hon. Members:: Oh, oh!


POSSIBILITY OF WITHDRAWING FROM SALE OF NUCLEAR REACTORS
Flora Isabel MacDonald: In view of the fact that over the years the Canadian people have been told by this government that we are in fact doing the third world a service by letting them have our reactors, will the minister tell the House whether the sordid and inept business practices of AECL have rubbed so much of the gloss off those pious sentiments as to induce the government to leave the nuclear reactor export business for good?
Hon. Alastair Gillespie (Minister of Energy, Mines and
Resources): No, Mr. Speaker, but I acknowledge that there were mistakes made. There is no question that mistakes were made. But I think we should recognize that while mistakes were made on the first one, we learned something.


Some hon. Members:: Oh, oh!


Alastair William Gillespie: Let me put it in these terms. I think we learned enough that we are going to more than compensate for the loss of the first by the profits on the second.


EXTERNAL AFFAIRS
Mr. Stuart Leggatt (New Westminster):: Mr. Speaker, my question is directed to the Acting Prime Minister. On February 16 it is reported that the United States and the European Economic Community signed an agreement which recognizes the new U.S. 200-mile coastal zone. That recognition, as I understand it, was unconditional. Can the minister advise what effect this will have on Canada's long-term claim to the Georges Bank?
February 22, 1977


Hon. Allan J. MacEachen (Acting Prime Minister):: Mr. Speaker, discussions are probably going on today in Washington between the U.S. and Canada on the question of Georges Bank, which is an outstanding issue between Canada and the U.S. As the hon. member knows, there is an overlapping claim with respect to Georges Bank, and that is a matter that is now under discussion between Canada and the U.S. Certainly, no action taken by the EEC with the U.S. or any other country in any way diminishes Canada's claim to the lines which it has put forward in its negotiations.


Stuart Malcolm Leggatt: Perhaps the minister can then explain to the House why it is that Canada, which made its unilateral declaration in January, was unable to obtain a similar agreement from the EEC as the United States has been able to do, therefore placing our claim in an inferior position to that of the U.S.? We do not have recognition by EEC of the claim to Georges Bank. Can the minister explain why Canada failed to obtain such an agreement while the U.S. was successful?


Allan Joseph MacEachen: As the hon. member may recall, before we undertook the unilateral declaration of the 200-mile limit, we had worked out with a number of European countries, apart from the U.S., bilateral agreements in which there was an explicit recognition of the regime that would exist within the Canadian 200-mile limit. But without challenging the accuracy of the hon. member's statement, I question very much whether an agreement of that kind would have any effect on the resolution of the disagreement which exists between Canada and the U.S. with respect to Georges Bank. That is a matter for discussion between the two countries and settlement, which is the route we are taking at the present time.


Stuart Malcolm Leggatt: In view of the fact that the EEC has recognized U.S. territorial claims without officially recognizing ours, after the March 1 declaration of the United States when their territorial claims will become law, is it Canada's intention to apprehend vessels entering the Georges Bank disputed area which do not hold Canadian licenses but which hold American licenses?


Allan Joseph MacEachen: One of the items that is presently under discussion with the United States is what the joint attitude will be toward third parties on Georges Bank. It is unlikely that the jurisdiction will not be settled because we are very close to March 1 and both Canada and the United States have declared their lines.


ELECTION EXPENSES
Mr. C. A. Gauthier (Roberval):: Mr. Speaker, I should like to put a question to the President of the Privy Council.
Oral Questions
On February 18 I directed a question to the Minister of Manpower and Immigration about the report on political contributions to the Liberal party for the financial year 1975. The Minister for Manpower and Immigration referred me to the Minister of National Revenue and now she tells me that it is not within her jurisdiction. This is why I am asking today the President of the Privy Council why we cannot obtain before June 30, 1977 the report of the Liberal party on contributions in 1975 when all parties were supposed to table their report before the end of the Financial year?


Hon.   Monique@: Mr. Speaker, if the hon. member will allow me, I shall answer his question. My French must have been distorted because I do not remember having said that my responsibilities are not my responsibilities. I am therefore pleased to advise the House that the Liberal Party of Canada, as requested last week, made a report to the Department of National Revenue, as prescribed by section 230.1(2), on contributions received during 1975. With regard to the contributions to all political parties in 1976, the parties, by ministerial decree, have until March 31, 1977 to report to my department. My report is then filed with the chief electoral officer, Mr. Hamel. That report, which of course is only a summary, will be made available. I shall see to it personally: as soon as possible after all pertinent information has been received, it will be made available.


Charles-Arthur Gauthier: Mr. Speaker, on a supplementary.
I thank the minister for her reply. I should also like to ask her whether the Liberal party had to ask the department for
an extension?


Miss B6gin:: My department advised me that the act had been complied with. Still, I shall enquire into the matter. I have not heard of any extension. We are referring here, I expect, to the report on contributions for the year 1975. No one requested an extension for that year: there is no question about that.


FINANCE
Sinclair McKnight Stevens: Mr. Speaker, my question is for the Minister of Finance. As the minister has indicated that the government has undertaken a study of retirement incomes which is wide enough to cover the private pension industry, will the minister now tell the House exactly who is conducting the study, what are the terms of reference, when will they report and to whom?


Hon. Donald S. Macdonald (Minister of Finance):: Mr. Speaker, officials in my department and officials in the Department of National Health and Welfare are engaged in the study. It is in the broadest sense to consider the questions of retirement income, particularly those related to the jurisdic-
3282

February 22, 1977
Oral Questions
tion of the government of Canada, and we hope to have the results of that study within a matter of months.


Sinclair McKnight Stevens: Mr. Speaker, as it has been represented that the Canada Pension Plan will pass a threshold on or before 1982 at which time benefit payments will exceed tax revenue, would the minister indicate what steps he intends to take to ensure that the Canada Pension Plan will be properly funded and not become a burden upon future taxpayers?


Donald Stovel Macdonald: This is a matter which has received some consideration by the government. In terms of our priorities in examining the pension system, however, it seems clear from representations made in this House that our first priority should be to examine the tax measures which affect the private pension system before proceeding to deal with the Canada Pension Plan.


Sinclair McKnight Stevens: Mr. Speaker, as there is a great hodge-podge of governmental pension plans at all levels of government, some funded and some not, would the minister indicate if he would be willing to go further and not just have the study he has referred to but also have a reference to the appropriate standing committee of this House to determine what are the aggregate commitments at this time for future pensions and to what extent these commitments are without funding? As such they may become a burden on future taxpayers.


Donald Stovel Macdonald: I would be glad to consider the suggestion. I am sure the House leaders might have something to say about the use of the time of the House in that way, but I personally would have no difficulty with the suggestion.

[ Translation]


INDUSTRY
Mr. Donald W. Munro (Esquimalt-Saanich):: Mr. Speaker, I would like to direct a question to the Minister of Industry, Trade and Commerce.
Is he in a position to inform the House about the present situation of the government's decision announced toward the end of November concerning import quotas of cloth, clothing and threads, to protect the Canadian textile industry?


Hon. Jean Chretien (Minister of Industry, Trade and Commerce):: Mr. Speaker, as a matter of fact import quotas for 1975 were put into effect on November 29 last. We have provided some special allowances in the most difficult cases. The Textile and Clothing Board is reviewing such cases. At the present time, most of them have been reviewed by the board, and I believe the policy as announced to protect the textile and clothing industry in Canada is operating very well right now.


Donald W. Munro: Mr. Speaker, I wish to ask a supplementary question.

Is the minister aware of the disastrous effect of this decision upon those who earn their living in small enterprises specialized in woollens, for example, retailing clothes that the Canadian textile industry has never manufactured?


Joseph Jacques Jean Chrétien: Mr. Speaker, I said earlier that the policy provided for flexibility and that as regards some exclusivities, the Textile and Clothing Board has the power to recommend additional quotas, when the textiles are not manufactured in Canada as, for example some Irish woollens and so on. Each shop facing such problems could make representations to the Textile and Clothing Board, and I am informed that generally some arrangements were made.


LABOUR CONDITIONS
John Allen Fraser: Mr. Speaker, my question is to the Acting Prime Minister. In view of the unusual comments of the Minister of Labour about the relationship between the NDP and the CLC and about the so-called new accommodation with the Liberal party, which comments have already drawn a blunt rebuttal from Mr. Morris, President of the CLC, and Mr. Pilkey, President of the Ontario Federation of Labour, who said, and I quote: "There is no way labour can find any accommodation within the Liberal party"-


Some hon. Members:: Hear, hear!


John Allen Fraser: -can the Acting Prime Minister advise whether the statement of the minister was made with the approval of the Prime Minister and his cabinet colleagues?


Allan Joseph MacEachen: Mr. Speaker, before answering the question directly, I wonder if 1 could draw to the attention of the House the historic speech which the Prime Minister made today in Washington.


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: I should like to congratulate him upon the great service he did for our country in his presentation today.


Some hon. Members:: Hear, hear!


Steve Eugene Paproski: Why doesn't he do the same in this House?


Allan Joseph MacEachen: In reply to the question of the hon. member, I am aware of no effort by the Liberal party to seek an accommodation with the Canadian Labour Congress. I am sure what the Minister of Labour had in mind was the continuing effort of the government to engage in consultation, not only with the labour movement in Canada but also with the business community, in order to address some of the serious economic problems facing the country.
February 22, 1977


John Allen Fraser: A supplementary question, Mr. Speaker. May I draw the attention of the Acting Prime Minister to what may turn out to be an historic speech by the Minister of Labour about this government's relationships with labour. Can the Acting Prime Minister tell the House whether labour has agreed to return its representatives to the now defunct Canada Labour Relations Council and the Economic Council of Canada, and agreed to the Minister of Labour's policy of establishing a multi-partite national forum? If the answer is no, how, then, could the minister say what I suggested he said on Saturday, namely, that he was building a new accommodation between the Liberal party and the CLC?


Allan Joseph MacEachen: Mr. Speaker, I am not in a position to confirm that the Canadian Labour Congress has resumed its membership on the consultative organizations to which the hon. member has referred. It would be the wish of the government for the Labour Congress to take a favourable decision and resume the possibility of making a contribution to these national bodies.


INQUIRY OF THE MINISTRY
Mr.   Jean-R. Roy@Timmins: Mr. Speaker, can the Secretary of State responsible for Heritage Canada and the national museums inquire if the blue flowers the official opposition are wearing today are a symbol of eternal hope or a wreath of mourning for their decision of one year ago?


Some hon. Members:: Oh, oh!


An hon. Member:: Ask that question one year from now.


SALE OF NUCLEAR REACTOR TO ARGENTINA-POSSIBILITY OF INDUCEMENT TO SIGN RENEGOTIATED CONTRACT-REQUEST FOR TABLING CONTRACT
Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, my question is supplementary to those asked earlier of the Minister of Energy, Mines and Resources concerning the contract renegotiated between AECL and the National Atomic Energy Power Commission of Argentina. What extra inducement or extra consideration was granted to the Argentina agency in the renegotiated contract, to induce them to sign a renegotiated contract? For example, is Canada extending a further line of credit to them in respect of the building of a reactor and, if so, how much?


An hon. Member:: Another $40 million.


Steve Eugene Paproski: Interest free.
Ora! Questions


Alastair William Gillespie: Mr. Speaker, I believe there was some additional financing. I am not sure how much but will be pleased to find out for the hon. member. That would cover the escalated costs of the total contract.


Steve Eugene Paproski: And what about the agent's fee? Is that an extra?


Allan Frederick Lawrence: A supplementary question, Mr. Speaker. I wonder if the minister could allay the fears of the many people in the country and in this House, about the renegotiated contract and the minister's obvious ignorance about some of the main parts of that contract, by tabling it, so that everybody can see it?


Alastair William Gillespie: Mr. Speaker, I will be pleased to consider that before the public accounts committee. As you know, that matter has been discussed at considerable length before the public accounts committee. I disagree with what the hon. member says about considerable apprehension on the part of the public about the renegotiated contract. I am surprised the hon. member's party did not want us to renegotiate it. Considering the kinds of losses we were facing, surely that was the right thing to do.


IMMIGRATION. PROPOSED INCREASE IN NUMBER OF INVESTIGATORS IN VIEW OF INCREASE IN ILLEGAL ENTRIES
Mr. Jake Epp (Provencher):: Mr. Speaker, my question to the Minister of Manpower and Immigration concerns the ever-increasing problem of the illegal entry of aliens to Canada. Will the minister indicate if additional man-years will be assigned to units such as the Toronto immigration investigative unit, and will similar units be established in other urban areas?


Hon. Jack Cullen (Minister of Manpower and Immigration):: Mr. Speaker, I do not foresee that at present. We hope that some of the measures to be proposed in the new bill will have the desired effect.


MEASURES TO IMPROVE CAPABILITIES OF INVESTIGATIVE OFFICERS
Arthur Jacob (Jake) Epp: A supplementary question, Mr. Speaker. Since officers of the Toronto immigration investigative unit have notified departmental officials that, in order to cope with the numbers of aliens on Toronto streets, including those whose street operations are frequently in violation of the Criminal Code, they need radio equipped cars, walkie-talkies, self-defence training as well as an outline of their rights and responsibilities, will the minister say when steps will be taken to allow the Toronto immigration investigative unit to do the job it must do? When will they receive the equipment and training for which they have asked?
80010-2%

February 22, 1977
Oral Questions


Jack Sydney George (Bud) Cullen: Mr. Speaker, precisely because of what the hon. member has raised, we sent investigating officers down, to find out what the situation is so far as our front line officers are concerned. They have a difficult job to do and 1 intend to do everything I can to help them, within the confines of the funds allotted to me.


LARGE AMOUNT OF TOUGH WHEAT IN PRINCE RUPERT
Mr. Les Benjamin (Regina-Lake Centre):: Mr. Speaker, I shall direct my questions both to the Minister of Agriculture and to the minister in charge of the Canadian Wheat Board, to let them know they are not being neglected. Is the minister in charge of the Canadian Wheat Board aware that most of the working capacity of the Prince Rupert terminal has been filled with tough wheat; that lack of drying capacity there has meant that one ship has remained idle for three weeks waiting to be loaded; that another ship now loading will be there for a total of two weeks; that a third ship was diverted to Vancouver, and that already five ships in Vancouver are waiting to load. I ask the minister, who co-ordinated the shipping of that amount of tough grain to Prince Rupert, when there was not sufficient time to get it dried for loading on ships? What action is being taken to get dry wheat in there to mix, and is he doing anything to increase those drying facilities?


Hon. Otto E. Lang (Minister of Transport):: Mr. Speaker, as I am sure the hon. member knows, the shipment of grain is co-ordinated by the Canadian Wheat Board. This particular grain was moved at a certain time in order to avoid or relieve serious congestion, particularly in the Peace River area. Whether the Canadian Wheat Board was aware of the volume of tough grain which was involved 1 do not know, I will have to check. I know they have taken action to bring dry grain from other areas, so that a mixing process can assist the dryers. Those dryers are not capable of handling this volume of grain easily or quickly. The situation in relation to Vancouver was complicated by the movement to Vancouver earlier of grain which was of a lower protein content than the Wheat Board had reason to expect. They have had to balance that movement with large volumes, particularly from southern Saskatchewan, where wheat of higher protein content is dependably available.


PRINCE RUPERT TERMINAL-MEASURES TO INCREASE DRYING CAPACITY-REQUEST FOR NAME OF LESSEE
Leslie Gordon Benjamin: Mr. Speaker, may I direct my supplementary question to the Minister of Agriculture? May I ask the minister, who is in charge of the Canadian Grain Commission which operates the terminal at Prince Rupert, two questions? One, is any action being taken to increase the drying capacities of that terminal at Prince Rupert? Second, and even more important, has the minister

yet decided what tender he is going to accept for the leasing of that terminal? Will he assure the House that it will not go to the Cargill Grain Company?


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, first, may I correct the report carried on CBC radio yesterday morning that two million bushels of damp grain are in that elevator? The figure is 1.2 million, less than they stated. Therefore, the dryer is running to capacity. They are blending that grain with grain which is dryer. There was not, over all, that waiting which was alleged, and demurrage costs were not as great as reported. When a ship goes to Prince Rupert it knows full well that it will take longer to load from that old elevator than from other elevators; on the other hand, that ship is several hundred miles closer to the port of destination. Also, let me add that I am to meet the Canadian Grain Commission in Winnipeg tomorrow.



FISHERIES


Miss Coline Campbell (South Western Nova):: Mr. Speaker, my question is for the Minister of Fisheries and the Environment. Is the minister aware that the larger boats which have been excluded from the gulf have come down to the Brown's and Germa Banks and increased the effort on the allotted haddock quota for this area? If so, can the minister give assurance to the fishermen of South Western Nova that their boat quotas will not be reduced in the month of June or the rest of the year, in light of this increased effort by the outsider boats on the haddock quota?


Hon. Romeo LeBlanc (Minister of Fisheries and the Environment):: Mr. Speaker, the fishing plan for 1977 tries to assure a fair share for all concerned, and tries to ensure that there will be no undue dislocation of traditional fishing patterns. Before considering the exact details of the hon. member's question I would have to look into this matter, and report to her.



EXTERNAL AFFAIRS


Mr. Douglas Roche (Edmonton-Strathcona):: Mr. Speaker, may I direct my question to the Acting Prime Minister? Is it the intention of the government to support the call of the distinguished Anglican Primate of Canada, Archbishop Scott, for an international investigation of the murder of Uganda's Anglican archbishop and two government ministers, and can the Acting Prime Minister tell the House if the Canadian government has yet expressed to the United Nations Human Rights Commission or the Commonwealth Association the
February 22, 1977

grave concern of the Canadian people about the escalating violation of human rights by President Idi Amin in Uganda?


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: Yes, Mr. Speaker. The government of Canada does support the call of the Anglican Primate for an independent inquiry into these tragic deaths. The government of Canada has already made known to the representative of Uganda in Canada that in our view, an independent inquiry is justified in the present circumstances. Therefore, we have no hesitation in supporting strongly and sincerely this particular request.



CANADIAN EFFORTS AT UNITED NATIONS TO PROTECT HUMAN RIGHTS

Douglas Roche: Expressing the dismay of members on this side that the motion of the hon. member for St. John's East on this particular point yesterday was denied, may I ask the Acting Prime Minister a supplementary question? In view of the escalating violations of human rights in many parts of the world-Russia, Czechoslovakia, Chile, Indonesia, to name just a few countries as well as Uganda-can the Acting Prime Minister tell the House what instructions have been given the Canadian representative to the United Nations Human Rights Commission to help the United Nations increase its worldwide efforts to protect human rights?


Allan Joseph MacEachen: Mr. Speaker, so that there will be no misunderstanding on this point, I should refer to the incident which occurred yesterday. We did not refuse to accept the hon. member's motion on substantive grounds but on procedural grounds-


Some hon. Members:: Oh, oh!


Allan Joseph MacEachen: -because the action called for in the motion had already been taken by the government of Canada. Therefore, there would be no reason to oppose it on substantive grounds. With regard to the United Nations Commission on Human Rights, I am pleased to advise the hon. member that the government has already acted. Prior to his question, we instructed our representative to the United Nations Commission on Human Rights, Mr. Beaulne, to take an active hand in bringing this particular incident in Uganda to the attention of the United Nations.



SUGGESTION THAT MOTION CALLING FOR INVESTIGATION OF DEATH OF ARCHBISHOP OF UGANDA BE PUT AGAIN

Mr. James A. McGrath (St. John's East):: Mr. Speaker, I thank the minister for that explanation of the unusual action in the House yesterday. Following on that reply, will the minister agree at three o'clock by unanimous consent to having that motion put, and this is a very important question, in order that the House of Commons may have an opportunity to
Oral Questions
support the government in its expression of its concern, and indeed its indignation, at what is happening in Uganda.


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: Mr. Speaker, I am not prepared to accept any further Standing Order 43 motions, whatever the subject, until the procedural question is clarified because just the other day we all agreed to an extremely good motion put forward by the hon. member for Winnipeg North Centre. Suddenly a debate took place which interrupted the normal proceedings of the House. Until that situation is clarified, I do not intend to agree even to this particular motion which we support 100 per cent.



INQUIRY WHETHER PRESIDENT AMIN WILL ATTEND MEETING OF COMMONWEALTH LEADERS

Mr.  R. Gordon L. Fairweather@Fundy-Royal: Mr. Speaker, can the Acting Prime Minister say whether this despotic, erratic and cruel leader of a commonwealth country will be part of the commonwealth leaders meeting in June?


Allan Joseph MacEachen: Mr. Speaker, I am not the person responsible for sending out the invitations.


Mr. Ray Hnatyshyn (Saskatoon-Biggar):: Mr. Speaker, on the basis that we on this side of the House will agree not to debate the motion referred to by my colleague, the member for St. John's East, will the government House leader have the motion moved at three o'clock on the order for motions?


Mr. Speaker:: Order, please. Hon. members will realize that these questions generally lie in the class of representation and when they carry an additional condition, they become hypothetical representations.



COMMUNICATIONS


Mr. J. P. Nowlan (Annapolis Valley):: Mr. Speaker, I have a question for the Minister of Communications. In view of the refusal of the minister of communications of Quebec to attend the Minister of Communications meeting later this month or early next month, and in view of the fact that this minister is one of the hosts or co-chairmen of the conference, has any decision been made for that conference to proceed?


Hon. Jeanne Sauve (Minister of Communications):: Mr. Speaker, as a matter of fact I communicated immediately with my provincial counterpart in Alberta. Of course I would have been pleased to see the Quebec minister take part in this meeting of communications ministers. I think he would have

Oral Questions
found there an excellent opportunity to discuss how the provinces can cooperate to set up the national communications and broadcasting policy which is his major area of concern and to start the discussion on the tools and means needed to enable the provinces to meet their objectives. Unfortunately it will not be possible. However, we decided to hold the meeting anyway.


John Patrick (Pat) Nowlan: Will the minister advise whether prior to that conference she intends to lay before this House the next stage in the telecommunications legislation or does she intend to discuss that with her respective and responsible provincial ministers? If it is not in the legislative stage, does she intend to take to that conference new proposals and new initiatives in the whole field of telecommunications, in particular involving some of the jurisdictional problems?


Jeanne Sauvé: Mr. Speaker, I hope that the legislation on communications will be tabled in the House so that I can lay it before the ministers who will be present at the meeting. It should be noted for the benefit of the House that this meeting is not a federal-provincial conference but a meeting of communications ministers set up as a forum in which views on a future communications policy will be exchanged.



FINANCE


Mr. Dean Whiteway (Selkirk):: Mr. Speaker, my question is to the Minister of Finance. It has to do with the Toronto rebellion. In view of the uprising in his own caucus after his decision last week to renege on a campaign promise to supply funds for urban transit systems, is the minister now prepared to reconsider that decision and include it in the upcoming budget? It is a policy which Canadians considered to be serious rather than a hollow campaign promise.


Donald Stovel Macdonald: As I
pointed out last week, Mr. Speaker, we have given an undertaking, indicated most recently by my colleague, the President of the Treasury Board, with regard to restraint on federal expenditures and we intend to hold to that.


Dean Waldon Whiteway: My supplementary question has to do with a study commissioned by and paid for in large part by the minister's department with the province of Manitoba and the city of Winnipeg a year ago. The minister will recognize it. It is called "South West Transit Study". In his announcement last week, the minister effectively killed that project, a project on which he asked for a tri-level study. Is the minister at least prepared to consider that one transit study and fund it rather than cut it off at the knees?

February 22, 1977


Mr. Speaker:: Order, please. That is clearly in the class of a representation. Presenting reports from standing and special committees.


Ramon John Hnatyshyn: Mr. Speaker, I wish to raise a point of order at this time. It is with regard to the statement made by the government House leader in response to questions from members on this side relating to the motion moved yesterday by the hon. member for St. John's East under Standing Order 43. In order that the government House leader can demonstrate the bona fides of the government in the interest of having a statement made by the House of Commons without any debate whatsoever, will the minister at this juncture move that we revert to motions under Standing Order 43 in order that the hon. member for St. John's East may now move the motion? This would give my hon. friend from St. John's East an opportunity to put forward a motion which would demonstrate that the House of Commons supports the position of the government with respect to this matter.


Mr. Speaker:: The hon. member raises this matter by way of a point of order. He realizes, I am sure, that it is one not totally within the authority of the President of the Privy Council, regardless of his extensive power and authority. The calling of motions pursuant to Standing Order 43 takes place prior to the question period, and any change in that arrangement should be made only with the unanimous consent of the House.


Ramon John Hnatyshyn: I simply want to ask, then, the permission of the House to revert to motions under Standing Order 43.


Mr. Speaker:: Order, please.



ROUTINE PROCEEDINGS


Donald Stovel Macdonald: Mr. Speaker, I should like to table a reference, under the antiinflation legislation, from the Anti-Inflation Board to the administrator with regard to Kelly, Douglas and Co.


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 ques-

tions will be answered today: 905, 1,197, 1,245, 1,373, 1,402, 1,562, and 1,639.


Mr. Howie: 1.	As of October 1, 1976, how many wage increases for workers in the Maritime Provinces were disapproved by the Anti-Inflation Board?
2.	How many firms in the Maritimes were found to exceed profit guidelines?


Mr. Bob Kaplan (Parliamentary Secretary to Minister of Finance):: 1. In the Anti-Inflation Board establishment the Halifax Regional Office is responsible for the Maritime provinces and the province of Newfoundland, and statistics are collected for these Atlantic provinces. From October 14, 1975 to October 1, 1976 collective agreements from this region totalled 1,186. In the preliminary assessment 605 cases were over the guidelines. By September 30, 1976 complete assessment of 302 cases was completed and submitted to the board. Of this number 149 agreements were rolled back. The balance were dealt with by the board subsequent to October 1, 1976.
2. Up to October l, 1976 two firms had excess revenues.


Mr. Stanfield: By province, what was the total amount of grants or contributions made to groups, projects, agencies or individuals, under the Non-Medical Use of Mood Altering Substances Programme in (a) 1975 (b) 1976 to support (i) informa-tion/education projects (ii) innovation projects (iii) research sociological and biomedical studies dealing with the non-medical use of drugs?


Hon. Marc Lalonde (Minister of National Health and Welfare):: (a) and (b), (i), (ii) and (iii)-See following statement.
(i) and (ii) Alcohol/Tobacco/Resources Fund*
1975-76	1976-77 (Est.)
Newfoundland	66,473	76,900
Prince Edward Island	6,550	

Nova Scotia	180,321	63,484New Brunswick	79,278	133,694Quebec	810,021	174,470Ontario	598,075	295,978Manitoba	241,241	83,513Saskatchewan	339,661	284,147Alberta	142,800	-British Columbia	330,465	277,916Northwest Territories	35,049	-Yukon	20,000	-Nat'l Organizations	123,200HQ in Ontario	125,000	Total	$2,974,934	$1,513,302
*Formerly Innovative Services-also includes education/infor-mation projects; there are no separate contributions.
Order Paper Questions (iii) Research Studies
Newfoundland	1975-76 11,200	1976-77 (Est.)Prince Edward Island	-	-Nova Scotia	42,138	33,862New Brunswick	-	-Quebec	327,041	333,325Ontario	854,590	1,038,800Manitoba	101,441	176,145Saskatchewan	67,212	38,211Alberta	119,690	52,371British Columbia	281,031	289,157Total	$1,804,343	$1,961,871


Mr. Jones: 1.	Did the Department of Consumer and Corporate Affairs grant this year to LTnstitut de promotion des interets du consommateur for consumer information and education, the amount of $50,000 and a total of $145,400 since 1973 and, if so, what are the precise duties of this group that it should receive such a grant?
2.	What are the duties and function of the Information Division of the Department?
Hon. A. C. Abbott (Minister of Consumer and Corporate
Affairs): 1. Yes, a grant of $50,000 was awarded to LTnstitut de promotion des interets du consommateur for the following purposes: (a) Magazine publishing, testing, $25,000; Magazine distribution, $10,000; (b) Consumer assistance and representation, $15,000; Total: $50,000. In previous years, grants have been for similar purposes-product testing, research and publication of the magazine. Since 1973/74, grants to 1P1C have totalled $145,400.
2. The Information and Public Relations Branch of the Department of Consumer and Corporate Affairs develops and carries out a communications programme to assist the department in the achievement of its objectives. The branch produces and issues a full range of information materials, involving both print and electronic media, designed to generate awareness and understanding of departmental legislation, the rights it protects and the responsibilities it imposes. Most of the communications programme is tailored to the needs of businessmen and consumers with the over-all objective of enhancing the fairness and effectiveness of the marketplace for the social and economic betterment of all Canadians.

February 22, 1977
Order Paper Questions


Mr. Neil: What was the total cost of the study carried out by the Anti-Inflation Board to determine the differences in food prices between Canada and the US?


Robert Phillip Kaplan: I am advised by the Anti-Inflation Board that the cost of the study was $3,234.


Mr. MacDonald (Egmont): For the years 1973 to 1975, by province, what was the average cost per job created under the Regional Development Incentives Act?


Mr. Ed Lumley (Parliamentary Secretary to Minister of Regional Economic Expansion):: The reply for the Department of Regional Economic Expansion is as follows: The following table provides information from 1969, the inception of the programme, to 31 December 1975, for those net accepted offers on which final payment had been made by that date. Records are not maintained in a way that permits the answer to be restricted to the period 1 January 1973 to 31 December 1975. The average cost per job created, in accordance with the foregoing, by province, is: Newfoundland, $2,929; Prince Edward Island, $4,481; Nova Scotia, $6,905; New Brunswick, $6,928; Quebec, $2,218; Ontario, $3,075; Manitoba, $6,414; Saskatchewan, $2,592; Alberta, $4,107; British Columbia $6,692.


Mr. Marshall: By constituency, between January 1 and September 30, 1976, what is the breakdown of the loans made in Newfoundland under the Small Businesses Loans Act?


Robert Phillip Kaplan: The requested data is not maintained by electoral district but only by province, by lender, by type of business and by purpose, for the following reasons: (i) Loans are made by banks to customers who may not live in the same constituency as the bank and whose businesses may be in yet another constituency, (ii) Constituency boundaries change from time to time; thus comparative statistics cannot be maintained on a consistent basis.


Mr. Epp: Does the RCMP intend to establish a regional detachment to serve the south-eastern region of Manitoba and, if so (a) in what location (b) what area will the detachment serve (c) how many officers will be stationed at the detachment?


Hon. Francis Fox (Solicitor General):: No.
(Mr. Abbott.]


Ralph Goodale: Mr. Speaker, if question No. 706 could be made an order for return, this return would be tabled immediately. I might say that the answer is some five inches thick, which is the reason for responding in this way.


Mr. Speaker:: Is it the pleasure of the House that the answer to question No. 706 be made an order for return?


Some hon. Members:: Agreed.


Mr. Cossitt: 1.	Did the St. Lawrence Seaway Authority approve a document on February 14. 1975 entitled: "Management Guidelines No. 18. Subject: Construction Contracts" and, if so, on page three does it state that tenders up to $50,000 are permitted to be made by the Chief of Purchases and Stores on the basis of invited tenders rather than tenders by public advertisement and does it further state that under certain conditions this situation can also be used on work estimated to cost up to $100,000.
2.	(a) What are the names and addresses of all firms presently on the list held by the St. Lawrence Seaway Authority for purposes of inviting tenders (b) who compiled the list (c) what are the names and designations of any persons furnishing, or in any way recommending names for inclusion on the list (d) were any Members of Parliament or members of any Liberal Party Executive consulted or otherwise involved in any way whatsoever with compiling the list and, if so, what are their names and addresses?
3.	What is a complete list of all such tenders called on this basis since January I, 1972 including, in each case, the successful bidder's name and address, the amount of their tender, the name and address of all others invited to tender and the nature of work done?
Return tabled.


Ralph Goodale: Mr. Speaker, would you be so kind as to call starred question No. 1,486?


Mr. Dinsdale: 1.	Was Dr. Noel Hall, professor of industrial relations at the University of British Columbia, appointed in October, 1976 to mediate the dispute between the Treasury Board and the Canadian Union of Postal Workers (CUPW) on technological changes in the Post Office Department and, if so (a) were proceedings of the meetings between Dr. Hall, CUPW officials and .government officials recorded (b) were any papers presented at the meetings by Dr. Hall. CUPW officials and/or government officials?
2.	Are copies of the proceedings and of any papers presented at the meetings available and, if not, for what reason?
February 22, 1977


Ralph Goodale: For the Public Service Staff Relations Board. 1. Dr. Noel Hall was appointed by the Chairman of the Public Service Staff Relations Board as a mediator on October 25, 1976 for the purpose of conferring with officials of the Treasury Board, the Post Office Department and the Canadian Union of Postal Workers and endeavouring to assist the parties in reaching a settlement of their dispute over the introduction and implementation of technological changes in the Post Office, (a) and (b) All mediation proceedings are conducted in private and the information and proposals provided to the mediator by the parties are furnished on a confidential basis to be utilized by him in the exercise of his discretion. Accordingly, there are no records of the proceedings before Dr. Hall nor is there any record of any papers presented to him by the parties.
2.	For the above reasons there are no copies available of any record of proceedings or any papers presented to him.


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


Some hon. Members:: Agreed.


Charles Joseph Clark: I rise on a point of order, Mr. Speaker. I should like to request the unanimous consent of the House to return to motions under Standing Order 43 for the purpose of seeking unanimous support for the motion moved yesterday by my hon. friend from St. John's East.


Mr. Speaker:: Order, please. If I were to permit the seeking of unanimous consent pursuant to Standing Order 43 at times other than those provided in the Standing Orders, it would take away the meaning of the routine proceedings by which we govern ourselves, which provide that applications pursuant to Standing Order 43 are made prior to the question period.
Since the Standing Order calls for an application for the unanimous consent of the House, we must either decide whether that can be done at any time an hon. member has the floor or whether, according to our practice, it is to be confined to the period prior to the beginning of the question period. We have rather rigidly followed the pattern that it is confined to the period prior to questions, and if I were to permit any hon. member who has the floor by any means to make an application at any time pursuant to Standing Order 43 we might just as well abandon the provision whereby such motions are confined to the minutes prior to the question period each day. Without any directive to that effect from the committee on procedure, I am not disposed to do so.


Charles Joseph Clark: I am not at all wishful of disputing your authority on this question, Mr. Speaker, but it is equally the case that the House of Commons is the final arbiter of its own proceedings. While I can understand and sympathize with Your Honour's concern not to establish a precedent which might interfere with the smooth functioning of the House, 1 believe it is recognized on both sides that there are at stake here two
Federal-Provincial Fiscal Arrangements highly important principles, one of them referred to in the substance of the motion moved by my hon. friend yesterday, and the other having to do with the right of parliament, as distinct from simply the government, to express its opinion on this matter. What I am seeking is an opportunity to ask the unanimous consent of the whole House of Commons to vary the rule, it being understood that such a variation would not establish a precedent but would be regarded as an extraordinary response to an extraordinary situation.


Mr. Speaker:: Order, please. In order to respect our procedures and allow an opportunity for the voicing of sentiments expressed on several occasions by members to my left, I must point out that tomorrow is another day, another opportunity for taking advantage of the provisions of Standing Order 43. It continues as a daily matter. There was nothing to prevent such an application from having been made today despite the fact that it was turned down yesterday, and there is nothing to restrict any member from putting forward the same application pursuant to Standing Order 43 tomorrow without having to circumvent our procedures or to set any dangerous precedent.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Monday, February 21, consideration of the motion of Mr. Macdonald (Rosedale) that Bill C-37, to provide for the making of certain fiscal payments and of established programs financing contributions to provinces, to provide for payments in respect of certain provincial taxes and fees, and to make consequential and related amendments, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Mr. David Orlikow (Winnipeg North):: Mr. Speaker, when I spoke last night I said we were opposed to this bill because the provinces were forced into this agreement and because the measures now proposed would have a particularly bad effect on the disadvantaged provinces, including the province of Quebec about which so much has been said. I have since had an opportunity to look at what some of the provincial premiers have said about these arrangements, as well as at the record of the discussions held between the first ministers.
I hope the hon. member for Lisgar (Mr. Murta) will note the following, particularly in view of his eloquent plea for understanding and support of Quebec. According to Premier Levesque as he was leaving the first ministers' meeting several

February 22, 1977
Federal-Provincial Fiscal Arrangements weeks ago, Quebec will lose $100 million in the first year as a result of the new agreement, by comparison with what the province would have received had the old agreement continued without change. The bulk of this loss will be the result of the change in the revenue guarantee provision. It has now been brought to my attention that Premier Levesque's estimate of the loss was probably on the low side. Since the meeting of the first ministers there have been some developments and announcements by the federal government which make it obvious that the government will further reduce the money that the provinces would have received under the old agreement.
When we look at how the established program financing is going to be affected by the new agreement we are being asked to support, we find this, Mr. Speaker. The Minister of National Health and Welfare (Mr. Lalonde) some time ago offered the provinces $20 per capita to finance nursing homes and other intensive care facilities, replacing an earlier offer which he made in 1975 to share the cost of such facilities 50-50. Anyone who has followed the course of the financing of hospital care in this country realizes that it was a colossal blunder on the part of the federal government to restrict its 50-50 cost-sharing program to intensive care hospitals. The provinces are, after all, responsible for the actual delivery of hospital services and for caring for sick people, not the federal government. The federal government had been prepared to pay 50 per cent of the cost of keeping patients in intensive care hospitals, hospitals that are very expensive to run and which cost up to $200 a day. On the other hand, the federal government has not been prepared to pay for the much lower cost of keeping a person in a nursing home or rehabilitative hospital, facilities that cost very much less but which, from the point of view of the provinces, cost the provinces more than their 50 per cent share of intensive hospital care financing.
Bill C-37 contains provisions which affect the $20 per capita offer that the Minister of National Health and Welfare made some time ago, restricting it even further. When this was brought to the attention of the federal government, the federal government agreed to hold its offer open until there was provincial consensus, setting a time limit of February 15 for the provinces to agree among themselves. I am told that last Friday the Minister of National Health and Welfare sent a telegram to the provinces indicating that the federal government would proceed with the $20 per capita figure I have already mentioned, on the ground that five provinces, representing 84 per cent of the population, had already agreed to his proposal. These provinces, with the exception of the province of Quebec, are the rich provinces, the provinces of British Columbia, Alberta, Ontario and Nova Scotia. This means, Mr. Speaker, that those provinces which tried to diversify their hospital care services, such as Manitoba and Saskatchewan- in accordance with the desire and recommendation of Ottawa-so that these facilities would be less costly both for them and for the federal government, are now going to be penalized, while those provinces which have not begun this
[Mr. Orlikow.)
process, the wealthier provinces in this country-British Columbia and Ontario-will benefit.
This proposal to switch from the open-ended, equal sharing formula to an annual grant which is based on population and gross national product is going to mean bonuses for those provinces with lower quality services, such as Ontario, and penalties for provinces which have recently improved their services, such as Manitoba. Unfortunately for pensioners, people who are handicapped, and others in need of assistance, this change will probably inhibit any further improvement in services. After all, if Ottawa is not going to share the cost, why should the provinces which are really strapped for money proceed with such improvements? As I said last night, existing services will undoubtedly, over a period of several years, be reduced in quality.
The minister's plan was outlined in a proposal which was sent in mid-January to the provincial health ministers. Since then he has made a few minor revisions, but nothing very fundamental. The original deadline was extended, as I have indicated, but now the options have been closed off. The decision of the federal government means that the Ontario government will get an extra $50 million in the coming fiscal year; British Columbia will get $23 million, despite the fact they have relatively low levels of adult care services; Alberta will gain $90 million because it will no longer be penalized for having facilities of too high a quality to qualify for cost-sharing. Meanwhile, poorer provinces such as Prince Edward Island stand to lose $2 million in the next year; Saskatchewan will lose up to $2 million; and Manitoba will gain about $800,000 the first year but will lose money in subsequent years. The last three provinces which I mentioned have probably had the best adult care services in the country.
Because none of the proposed grants will be earmarked for adult care services, the provinces will be under no obligation to improve or even to maintain such services. Furthermore, the recent removal of automatic cost-sharing will discourage the provinces from improving their services because suddenly they will be facing double the cost. All of this is because the federal government would give each province $20 or $21 per person for theoretical expenditures for adult care services, regardless whether the province spends $1 or $1,000. The $21 would increase or decrease each year in accordance with a three-year average of the gross national product.
This may be fine for the bureaucrats who develop budgetary details because it will give them a better idea of what their costs are likely to be. But it takes no account at all of the actual record of the provinces in the past. It takes no account of the needs of the people. It is a proposal based simply on a formula that makes it comfortable for the federal government and its finance department. This is just one example of how the government's proposals will affect the provinces adversely.
I want to deal for a moment with the whole question of equalization. The federal government forced the provinces to agree to an equalization program based on what the Minister of Finance (Mr. Macdonald) has described as the "representative tax system" approach. The provinces were given two

formulas from which to choose. Each formula contained variations in the treatment of the different forms of provincial taxes, and each of them was pretty adverse to the interests of the provinces and their people. For one thing, Mr. Speaker, the formula that would probably be adopted, formula B, equalizes all revenues from oil, gas, metallic and non-metallic minerals to the extent of 50 per cent but places an additional limit in that equalization payments in respect of all resource revenues may not exceed one-third of total equalization payments.
When the federal government put a limit on the equalization of oil and gas revenues it was to be a temporary measure to allow the federal government to adjust to the rapid increase in provincial government revenues from this source. However, given the increase in the importance of non-renewable resource revenues to the provinces-in 1969-1970, resource revenues accounted for 13 per cent to 16 per cent of total equalization and by 1973-1974 this had jumped to 23 per cent to 25 per cent-the federal government decided that a permanent limit was needed.
All the provinces with revenue from non-renewable resources are pleased with the first cap on the formula as it will help reduce some equalization losses. However, the second change poses some dangers. If resource revenues continue to grow in importance-they are now around 29 per cent of equalization payments-the 33.3 per cent ceiling could be reached very quickly and the provinces could start losing potential equalization payments.
It is obvious that the provinces resent this unilateral decision on the part of the federal government. They look upon it, quite correctly, as an invasion in a field of taxation which from the time of confederation has been almost exclusively a provincial preserve. They feel, and I think quite rightly, that their need for financing and their ability to tax is very much less than the federal government's, and that the federal government had no right to put that restriction on it. I think the more we look at the principles contained in the bill, the more we realize the federal government is continuing the policies which have been with us since the Prime Minister (Mr. Trudeau) took office. The federal government feels that because of its constitutional power, and particularly because of its power to tax, it has the complete right to decide unilaterally what shall be the preserve and rights of the federal government and what shall be the rights of provincial governments. We do not believe that in a federal system any federal government, regardless of the party in power, has that right. We do not believe it has that right legally. We do not believe it can be good for federalism and for an efficient and fair division between the federal government and the provinces for the federal government to arrogate for itself those rights.
We believe federalism can only work if the provinces and the federal government are joined in a real partnership in which the rights and the responsibilities of all levels of government are dealt with on a fair and equitable basis. We see no sign that this government has changed that aggressive, unilat-
Federal-Provincial Fiscal Arrangements eral power which it has arrogated unto itself. We believe the course it has been following, and continues to follow, is detrimental to real federalism. We believe it will lead the provinces to rebel and will encourage those people in the province of Quebec who really want a separate state to continue at a greater rate to advocate that policy. We believe it is detrimental to the good and to the welfare of the people of Canada. It is for that reason we believe that members of parliament, regardless of party, ought to vote against the bill.


Some hon. Members:: Hear, hear!


Hon. John Roberts (Secretary of State):: Mr. Speaker, I must say how delighted I am, particularly with the salutations of my good friend the hon. member for Edmonton Centre (Mr. Paproski). I am pleased to be able to enter the debate, which I will do very briefly, because it gives me an opportunity to explain to the House some of the recent developments in the relationships between the provinces and the federal government on the matter of education. I do not feel it would be useful for me to elaborate on the details of the provisions of the established programs financing legislation which has been explained by the government. That information is readily available. I should like to say at the outset, however, that in my view the new act contains a number of improvements over the old Fiscal Arrangements Act both from the point of view of this government and the provincial governments.
First, the provinces will be able to predict revenues from the federal government much more accurately. Second, provincial governments will have considerably more freedom with regard to how they choose to spend the federal contribution to post-secondary education. They will no longer be tied to a dollar for dollar cost-sharing arrangement, but will be free to establish their own priorities in educational spending without affecting the size of the federal contribution. Third, there will be no more need for the complex and often irritating system of auditing eligible operating expenditures at post-secondary institutions. This should increase the speed of settling accounts between the two levels of government. There are other advantages. I am happy that the new arrangements will have the result of distributing the federal contribution more equitably among provinces than was the case under the old Fiscal Arrangements Act.
I think the move toward an equalized per capita cash entitlement based upon provincial population is good and it should assist those provinces which formerly, on per capita terms, received significantly less than the national average. 1 should point out that because of the transfer of increased tax room to provinces those provinces with a high tax yield, particularly from personal income tax, will reap the benefit of relatively higher value in tax points.
1 should like particularly to tell the House of the change which has taken place over the last few months in the relationship between the provinces and the federal government in matters of education. I am sure many members recall that when the subject of bringing forward the established programs financing arrangements was broached by the Prime Minister

February 22, 1977
Federal-Provincial Fiscal Arrangements (Mr. Trudeau) last June, he had occasion to remark that there was a necessity for some continuing forum for the discussion of provincial and federal concerns in this matter. In the statement the Prime Minister made on the subject which was tabled in this House in the middle of last June, paragraph 22 dealt with the necessity of combining and co-ordinating federal and provincial efforts. He said:
Combining and co-ordinating federal and provincial efforts require appropriate arrangements for intergovernmental consultation at the ministerial level, so that governments may together consider and develop policies of national significance in the fields of health and post-secondary education.
He went on to say : "In the health field we already have an established forum at ministerial level and that for post-secondary education there have been occasional contacts but we need a more permanent forum." Shortly after I became Secretary of State in September last year, I was charged with responsibility for undertaking discussion with the provinces to see how we could give concrete form to the expressions of the Prime Minister which 1 just cited. Toward the end of September I met, in Halifax, the council of ministers of education to discuss how we could elaborate on procedures of consultation which would be satisfactory to both levels of government. I think it is fair to say that I found some apprehension on the part of provincial ministers of education about the intentions of the federal government.


Steve Eugene Paproski: Did they let you know?


John (Moody) Roberts: They not only let me in but they welcomed me and provided me with a very good lobster dinner.


Flora Isabel MacDonald: You really did not need it.


John (Moody) Roberts: That last comment is so unkind that it is unworthy even of the hon. member for Kingston and the Islands (Miss MacDonald). She really hits below the belt. Not only that, but she has managed to derail my train of thought.
I was in the process of saying to you and to members of the House, Mr. Speaker, that I found some apprehension on the part of ministers of education as to exactly what was meant by the word "forum" or what was in the federal government's mind when it spoke about the establishment of a mechanism to discuss common areas of interest relating to education. To a great degree I think that those were problems of semantics, not problems of substance. I found, also, that there was concern that the federal government might have in mind the creation of an institution which would supplant, overcome or replace the council of ministers of education which had been established by the provinces and which had done such good work. I am not attributing this to any particular minister of education, but I almost sensed there were some who feared that the federal government might be desirous of making the Department of Secretary of State into a super-department of education and culture. I believe I was able to allay the fears of the ministers of education in this regard. Certainly, it is not true that it is our intention to impinge upon their area of jurisdiction in relation to education which clearly, under the BNA
[Mr. Roberts.)
Act, is a matter of jurisdiction for the provinces. We respect the jurisdiction which they have, and have no desire to interfere with it.
It was exactly because of this concern that we had to establish some continuing procedure for discussion with the provinces which reflected the kinds of views that were expressed yesterday by the hon. member for Kingston and the Islands. I would like to refer to her comments as recorded at page 3242 of Hansard of February 21, 1977. I do so not in any spirit of confrontation or antagonism. I should like to reveal that we have, in effect, implemented the kind of approach which I believe she suggested we should take. In her comments, she remarked that she felt we had missed an opportunity to act in a positive and constructive way; that is, to discuss certain questions relating to education with the provinces. She picked out, in particular, the possibility of an interprovincial agreement to ensure unimpeded mobility between provinces for students seeking post-secondary education.
The hon. member lamented that we had let slip an excellent opportunity to undertake discussions on this problem. Later she indicated that she felt bargaining would be far more productive if the provinces and the federal government brought to the negotiations a realization that their common purpose is to reach acceptable settlements and not to find out who will knuckle under to whom. She went on to say:
It is all too easy to see our problem in terms of conflict between the federal government and the provincial governments. All the attention is focused on the arenas of federal-provincial conflicts-
I would like to tell the hon. member that, far from letting the opportunity slip by, what we have done is to establish a continuing method of discussing such problems-and the one she indicated is one which is of great concern to us, namely, a method of discussing with the provinces that question and many others as well. Since September the provinces have come forward in a most co-operative spirit, agreeing with us that such a method for discussion should be established. It is in that spirit of negotiation and realization of our common purposes, to which the hon. member referred in her remarks, that we have undertaken this effort to establish a method of carrying on the dialogue.
At the end of the Halifax meeting in September to which I referred, the council of ministers of education issued a communique. I should like to cite the last paragraph of it which clearly indicates the kind of understanding we have reached with the provinces. It reads:
The council has also been seriously considering its relations with the federal government. Because the concerns of the CM EC cover all aspects of education, the council sees the need to exchange views with the federal government from time to time, depending on the subject, for the purpose of discussing the interface between education policies as determined by the provinces, and various federal programs. It is agreed that the council is the mechanism for such discussions and it will provide further opportunities for them to take place in the future.
Subsequent to that September meeting I met with the executive committee of the council early in November and there was agreement about various matters which might be placed on the agenda for a subsequent meeting between the
February 22, 1977____________________________COMMONS
federal government and the provincial governments. That meeting took place in January, in Quebec City, and two matters of common interest were discussed. The first was the possible renegotiation of the agreements we have with the provinces, commonly called the formula payments, for the support of the official second language and minority language instruction throughout the country, and the second was the question of student assistance. The important question which the hon. member raised is equally one which could be discussed and I will explore the possibility of placing it relatively soon on the agenda for discussion.
So you see, Mr. Speaker, that we have implemented in a satisfactory way, I believe, the kind of intention that was expressed in the Prime Minister's comments last June. I would prefer not to call it a "mechanism" or a "forum". I do not want to get into a semantic confusion which might be misinterpreted. Let me say that we have simply established a continuing arrangement for the discussion of the interface of the policies of the federal government and the provincial governments which touch upon the area of education. It is a method for communication and for discussion of questions of common interest and common concern. Certainly, it does not represent any desire on our part to interfere with or to supplant the council of ministers of education, nor is it in any way an attempt to displace provincial responsibility in relation to education. It is, in essence, a common sense arrangement to discuss matters that are of mutual concern.
It is because of those developments which have taken place in the few months since September, which I believe were very satisfactory developments, that I believe the provincial ministers of education feel we are on the right track. I must confess to the House that I am extremely satisfied with the constructive, positive and welcoming attitude which the ministers of education have adopted in both establishing this procedure for discussion and in the substantive matters we have discussed so far. They have been extremely co-operative, and I welcome that and try to be as co-operative with them as I can. It is because of these developments, of which not all hon. members may be aware, that I thought I should indicate to the House what the situation is now. I should like to point out to hon. members that it was because of this procedural development that we placed in the bill clause 24(3) which refers to the responsibility of the Secretary of State. It reads:
-to consult with the governments of the provinces with regard to the relationship between the programs and activities of the government of Canada and of the government of the provinces that relate to post-secondary education.
I believe that subclause in the legislation embodies or crystallizes the practical and common sense arrangement which we have worked out with the provincial governments.


Mr. Stan Schellenberger (Wetaskiwin):: Mr. Speaker, wearing a blue flower in my lapel, and with memories of a grand convention held just one year ago, I should like to add my congratulations to the hon. member for Rocky Mountain (Mr. Clark) for a most successful first year.


Some hon. Members:: Hear, hear!
DEBATES	3293
Federal-Provincial Fiscal Arrangements


Steve Eugene Paproski: Even Simma thinks he is great.


Stanley Kenneth Schellenberger: I invite hon. members to reread in Hansard what I thought was an excellent speech given by my colleague the hon. member for Lisgar (Mr. Murta) yesterday.
I thought his speech was very well delivered.


Some hon. Members:: Hear, hear!


Stanley Kenneth Schellenberger: I wish to make just a few comments in this debate on federal-provincial fiscal arrangements. I would like to leave the details of these arrangements to my colleagues to discuss. My concern is about the way the agreement was arrived at. In December of 1976 the 11 first ministers met in Ottawa to iron-out the details of this new federal-provincial cost-sharing scheme. Eleven individuals had the responsibility to determine a new economic relationship which will affect all Canadians.
The use of federal-provincial conferences has increased tremendously in the past few years, yet few of us have taken the time to examine the implications of this type of decision-making. Federal-provincial conferences deny elected officials from provincial legislative assemblies and from the parliament of Canada the opportunity to represent the views of their constituents. Instead of being based on the collective will as represented by members of legislative assemblies and members of parliament, the decisions arrived at in a first ministers' conference are based on the will of only 11 individuals. While I have few doubts about the competency of these first ministers,
I resent the fact that these men are speaking for all of Canada when they do this without a resolution of either the elected assemblies of the provinces or a resolution of the House of Commons. The people of Canada have elected federal and provincial members in the belief that these men and women will not only represent their views but, also, that this representation will have some impact on policy formation. However, when the policy formation takes place at a federal-provincial conference it is clear that we, as elected representatives, have no way of making known the views of our constituents.
The first ministers' conference is a very vivid example of the present trend toward technocratic decision-making in Canada. Unable to comprehend the technicalities of each issue, the premiers and the Prime Minister (Mr. Trudeau) come to these conferences armed with a battery of advice and expertise provided to them by public servants. The power of these bureaucrats has reached awesome proportions, and as a result of this increased power the phenomenon of top-down legislation has emerged. Policy originates in the cloistered offices of government departments in Ottawa and only slowly and sporadically seeps down to the general populace. The bureaucrat makes plans without assessing the interests of the citizens to be affected by those plans. After implementation of a certain policy he compounds his first mistake by failing to arrange for adequate and instantaneous feedback on how the policy is working. Insulated from the real wishes of the citizenry which he claims to serve, the bureaucrat assumes the right

February 22, ] 977
Federal-Provincial Fiscal Arrangements to set social goals by himself or he accepts them blindly from some higher authority. As a result, individual citizens are becoming increasingly alienated from the political process.
As the elected officials of this country, we have the opportunity and, indeed, the responsibility to combat this alienation. In our capacity as members of parliament, MLAs or municipal councillors, we must make an active and determined effort to become familiar with the wishes and wants of our constituents. Canadians are in an excellent position to offer constructive input. The educational level of our citizenry is higher than it has ever been. It is time that we tapped the knowledge, experience and common sense of ordinary Canadians. Only by doing so will we have the tools necessary to help us in our search for good government policy.
In politics, as in industry, health and welfare and in education, goals have been set without the participation of those affected by them. Such goals will be increasingly hard to meet as citizens become more and more removed from the actual process of establishing them. What we need in this country is a dramatic reassessment of where we, as Canadians, are going. This reassessment must not be made only by politicians, sociologists or the elite, but by the people themselves. All of us must ask ourselves what kind of country we want to have ten, 20 or 30 years from now. Let us talk to the people of our provinces and to the people of Quebec. 1 believe we should attempt to reactivate the town hall meetings of an earlier era and rekindle the spirit of citizen participation which contributed so greatly to the strength of Canada. Only when people from all walks of life-students, parents, professionals, workers, intellectuals and executives-get together to discuss the options for the future can we be assured that we will have the guidance and the ideas we need.
From time to time all of us feel left out-those in the west, those in Quebec, those in the maritimes, and even, 1 am sure, those from the great province of Ontario. Flowever, this feeling of alienation does not have to be an inevitable aspect of modern society. We can, and must, construct a system of feedback and of input to all government levels from all people. In light of the Parti Quebecois position on separatism, it is not just advisable that we open the lines of communication; I believe it is imperative.
Among industrialized nations, the United States has led the way in efforts to reinvolve the citizenry in the political process. Recently, the state of Washington conducted a very successful experiment in citizen participation. In its previous attempts to arrive at long-range plans for the state, expert reports had been relied upon and had regularly proved fruitless. Under the slogan "You are the experts", a massive information campaign was launched in the state. A questionnaire was circulated asking citizens what kind of country they wanted to live in in the year 2000. The views of individuals and groups within the state were assembled, and on the basis of these attitudes a citizens' committee selected 11 alternative policies for the future of the state of Washington. A broad publicity campaign was again launched in the press and on television asking citizens for comments on the 11 policy options. After receiving

this additional public input the governor of the state of Washington selected the priorities to be followed by government officials in the years to come.
While the idea of such extensive citizen involvement in the policy formation process is extremely innovative, there is no reason why the Washington model could not be adapted to Canada. Whether on a munipical, provincial or national level, consultation with the citizenry would allow for a more democratic decision-making process and a more coherent plan for the future. As a preliminary step we, as members of parliament, might start to canvas our own constituents for their opinions as to what kind of Canada they would like to see by the end of this century. This would force both ourselves and the people we represent to look at the possibilities and the constraints involved in planning for the future.
I ask hon. members to take some time to consider these ideas. The problems facing Canada-whether they be those regarding the economy, the environment, unity, or the quality of life-cannot be resolved solely by the technocrat tools of government bureaucrats. Their input is important, but it must be supplemented by the wisdom of Canadian citizens.


Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, Bill C-37, an act regarding federal-provincial fiscal arrangements, comes before parliament at a time when Canadian confederation faces its most serious challenge in our history. All parties in this House agree on the need to maintain our federal system. I think we all believe that the separation of Quebec from the rest of Canada would have serious consequences for that province and for the rest of Canada. The main question which members of this House and the Canadian people must consider is: how can we persuade the people of Quebec that it is to our mutual interest to retain confederation? I submit it will not be done by making inflammatory statements or taking inflexible positions. It will not be done by making the issue a personal contest between the Prime Minister of Canada (Mr. Trudeau) and the Premier of the province of Quebec.


Flora Isabel MacDonald: Hear, hear!


Thomas Clement (Tommy) Douglas: It would be unfortunate if the debate on federalism were to degenerate to that level. In the final analysis, the decision to hold Canada together will rest with the people of Quebec. It is our job to convince the people of that province that it is in their best interest to remain in confederation and to assure them that they can safeguard their language, culture and traditions within a federal system.
The federal government has not done too well in this regard. In 1968, when the Prime Minister led his party's general election campaign of that year, he poured scorn on the suggestion of the hon. member for Halifax (Mr. Stanfield), then the leader of the Conservative party, and on my suggestion, then as leader of the New Democratic Party, that we should consider the concept of "des deux nations," that we should
February 22, 1977

consider a particular status for Quebec despite the fact that Quebec has had that particular status since 1867. The Prime Minister told the people of Canada that his inflexible position would ensure a one-Canada policy. In 1968 the Parti Quebe-cois had the support of about 8 per cent of the people in the province of Quebec. Now, in 1977, they are the government of the province of Quebec. Surely that ought to teach the government and the rest of us something, that the approach to this problem must be one of flexibility, good will and understanding. I think that the Prime Minister in recent weeks has begun to relent; he is now somewhat less adamant than he has been for the last nine years.
I am not so naive as to think that concessions offered to Quebec will change the minds of confirmed separatists. I think those who are convinced that Quebec should become a sovereign power probably hold that position so firmly that no amount of concessions will make any difference. It would be wrong to make concessions which could weaken the national government of this country to the point where it had not the necessary powers to govern the country and to enable this country to operate as a nation. I am equally convinced that a majority, probably a substantial majority, of the people of Quebec want to remain in confederation if they can be convinced that within the federal system their province, along with the other provinces of Canada, will be treated fairly and justly. It is the responsibility of the House of Commons to demonstrate that under our federal system all regions of Canada are treated equally and fairly. Unfortunately, the government has chosen this particular time to introduce a measure which is both unfair and discriminatory.
The provinces are being compelled, with a gun at their heads, to accept a revision of fiscal arrangements, a revision which has enabled the federal government, under the guise of a restraint policy, to transfer many of its financial burdens to provincial governments, provincial governments which have a narrower financial capacity than the federal government for coping with these burdens. Hon. members have heard talk, for example, of the revenue guarantee program and the changes the federal government has instituted unilaterally. Those changes will mean a reduction of over S400 million in the revenues our provinces will receive.
Also let us consider cost-sharing programs. Under those programs provinces formerly were entitled to claim from the government of Canada 50 per cent of the money they spent on hospital insurance, medicare, post-secondary education and welfare expenditures incurred under the Canada Assistance Plan. The Secretary of State (Mr. Roberts) said this afternoon that the provinces will be pleased with this change, with this alteration in the 50-50 division of expenditures, because it will relieve them of the necessity to spend dollar for dollar what the federal government spends. Surely that statement was the height of absurdity, for it was the federal government which was required to spend dollar for dollar what the provinces spent. Now the provinces will have certain responsibilities in these important areas without any assurance that the federal government will match their expenditures dollar for dollar.
Federal-Provincial Fiscal Arrangements Instead, the provinces are to be given tax points for personal income tax, corporation taxes and cash grants.
A government spokesman argued that this change to tax points and cash grants will provide the flexibility which the old 50-50 cost-sharing programs did not provide. That argument will not hold up under examination. It is true that under the 50-50 cost-sharing program there was a certain lack of flexibility because the federal government said it would only meet certain costs on a 50-50 basis. Consequently, the provinces were compelled more and more to build acute treatment hospitals instead of more nursing homes, instead of providing home nursing services and instead of providing meals on wheels. That flexibility could have been provided within the 50-50 cost-sharing program by saying to the provinces, "We will meet 50 per cent of what you spend on hospital insurance, medicare, post-secondary education and welfare assistance, no matter whether you divert it to one part of the program or to another aspect of it."
One of the most unfair features of the tax points system is that it treats the provinces differently. One tax point can mean $10 per person in one province, and $4 per person in another. Surely that is manifestly unfair. The inevitable result will be that some provinces will get more revenue from these tax points allocated to them than other provinces. Consequently, some provinces will be able to establish a higher standard of service in cost-sharing fields than other provinces. We will have destroyed what has been a matter of pride in this country, namely, that we have national standards for hospital care, medicare, post-secondary education and welfare. When we begin to have different standards for these important services for the people of Canada, we embark upon a road which will lead eventually to the balkanization of this country. The government is moving in a dangerous direction when it undertakes such a step. Inevitably, depending upon tax points for financing a substantial part of this program will result in disparities between the provinces.
Yesterday I listened to the hon. member for Kingston and the Islands (Miss MacDonald). As reported at page 3241 of Hansard she made the statement that the hon. member for Oshawa-Whitby (Mr. Broadbent) was less than honest when talking about this disparity of treatment between the provinces because of the transitional tax equalization provisions. I have tremendous respect for the hon. member for Kingston and the Islands. However, I ask her to look at the total picture-not at any estimate which I have made, but at the figures which have been filed by the Department of Finance. I invite the Minister of Finance (Mr. Macdonald) to make these documents available to the members of this House and certainly to make them available when the bill is being discussed in committee.
On the basis of the tax differences on the total receipts which the provinces will get from the fiscal year 1977-78 to the fiscal year 1986-87, a ten-year period, what do we find? We find that in the ten years covered the province of Ontario will have a cumulative increase of $1,300 million. The province

February 22, 1977
Federal-Provincial Fiscal Arrangements of British Columbia, which gets nothing for the first six years, will get a cumulative increase of $200 million. The remaining eight provinces of Canada will get no increase at all for the first nine years. In the last year the amounts of money will be negligible: Newfoundland, $1 million; Prince Edward Island, $200,000; Nova Scotia, $1.9 million; New Brunswick, $1.3 million; Quebec, $10.4 million; Manitoba, $1.7 million; Saskatchewan, $1.7 million; Alberta, $1.6 million.
Outside of Ontario and British Columbia, the other provinces in the first nine years, according to the government's own figures, get no increase. I submit that this is equalization in reverse. The two provinces with the highest per capita income will get more money, and Ontario will get more money every year. The poorer provinces will get nothing by way of an increase in the first nine years. I submit there is something seriously wrong with this system of tax points. It can only lead to continual aggravation of the disparities which now exist between the wealthy and the poorer regions of Canada.
This scuttling of the 50-50 cost-sharing arrangement, replacing it with tax points and cash grants, leaves all the risks to the provinces. Under the 50-50 sharing program they knew that if they spent $1 million the federal government would match it with $1 million. Now they are entirely dependent upon what the tax points allocated to them will bring in. Therefore, any decline in the gross national product will affect them adversely.
Every member knows that the amount of sickness in the country, the number of people who have to be taken care of through welfare, and the number of old people who have to be given custodial care, does not go down because the gross national product has gone down. If any government is in a position to take the risk of a drop in the gross national product, it is the federal government. It has some responsibility in that situation. However, the provinces will have to bear the burden of increased costs at a time of economic recession, the very time when the revenues they receive to meet adverse economic conditions will be declining.
Under the proposals in this legislation there will be very little for new programs: the amount available is negligible. The provinces will receive one-half of a tax point equalized to the national average, plus an equivalent amount in cash. This is estimated to give the provinces between $200 million and $400 million over the next five years, despite the fact that the Minister of National Health and Welfare in 1973 offered the provinces $600 million over the following five years.
My hon. friend from Winnipeg North Centre (Mr. Knowles) has already explained what this change in financial arrangements will mean in the field of adult care. Whereas under the Canada Assistance Plan costs have been shared 50-50, the provinces are now going to get eight tax points, and for the purpose of providing adult care, $20 a head. What will be the result of that? Look at the discrepancies. British Columbia, an additional $23 million; Ontario, an additional $50 million; Alberta, an additional $19 million. Prince Edward

Island will lose $2 million; Saskatchewan will gain $2 million; Manitoba will gain $800,000. But next year the amount will decline. Is it any wonder that the Saskatchewan minister of finance, according to a report in the Globe and Mail this morning, said:
The federal decision to change the method of cost-sharing is a cruel blow to the aged and handicapped in Saskatchewan. Where we had hoped to provide a significantly enriched level of service, we now will find it extremely difficult to do so, given the loss of federal cost-sharing dollars.
He went on to say:
The $20 per capita will barely cover our losses under the Canada Assistance Plan in the first year. In future years we will actually receive less money. And with less federal money we are expected to increase the range of low-cost health services in the provinces.
I do not think any hon. member who looks carefully at this situation could fail to agree that in times of economic adversity the responsibility of the provinces increases. This legislation makes it almost certain that provincial revenues will decline at the precise time when economic adversity makes itself most felt. I want to suggest to the government that the least it could do when this obnoxious legislation goes to the committee would be to average the tax points for the cost-sharing programs to the highest province, in order to remove the disparities which are inherent in this bill. Levelling the tax points to the highest province would remove some of the disparities. Moreover, it would not leave the provinces to take all the risks, and it might provide some funds for developing new programs.
I might point out that this is the position taken by the provinces themselves. I have in my hand a copy of a speech which was delivered at the conference of finance ministers on December 6 and 7, 1976. It was made by the hon. Merv Leitch, the provincial treasurer of Alberta, on behalf of all the provinces. I underline that fact. This was one of the few occasions at a federal-provincial conference when one spokesman was able to present the views of all the provincial representatives. I will read just one paragraph of what he had to say on behalf of all the provinces.
It is essential to our proposal that these tax points be equalized to the level of the highest yielding province. The proposed equalized tax point transfer is viewed as having a very special purpose. It would permit all provinces to benefit equally from the increasing yield of the tax points. At the same time, it would provide all provinces with the potential to achieve the same standard of per capita program expenditure. As the Prime Minister stated last June: "There should be greater equality in per capita terms among the provinces with regard to the amount of federal funds they receive under the programs." This is a federal principle that all provinces endorse. We are not prepared, however, to accept any disparity. It would be illogical to equalize to the national average if the number Of points to be transferred were calculated with reference to the province with the highest per capita yield. More importantly, it would be inequitable because it would lead to wide divergences in the per capita value of the total federal contribution.
He went on to say:
We emphasize that we are not seeking equalization to the top for general equalization.
In other words, the provinces were not asking for general equalization financing. They were'urging that in this costsharing program the tax points allotted to the provinces should be equalized to the highest province in order that there might be no disparities and in order that the per capita benefits to the
February 22, 1977

provinces would, on the whole, be the same right across Canada. I submit that failure to act in this way will result in a patchwork of standards across Canada. It will create second-class citizens in some regions. I find myself obliged to ask the government whether this is the best they can offer the Canadian people. In particular, I ask whether this is the best they can offer the people of Quebec whom we are seeking to persuade to stay in Canada because we support each other and co-operate to provide fair and equal standards across the country.
One of the questions which every member of parliament ought to ask, and one which I hope the people of Canada will ask themselves, is this: why do we wish to retain a federal system? We are not likely to keep Canada together by rhetoric and sentiment. There must be a raison d'etre for staying in the Canadian family. Like all members, I have emotional ties with this country. All of us have warm recollections of various regions of Canada, its environment, its scenery, its people. All of us are challenged by the possibility of building in Canada a society which is different, a country whose tolerance and diversity make it outstanding. But I base my belief in the need to retain a federal system in this country on three things. First, I believe that only a united Canada can give us true national independence. I am an independent. I believe in independence, not Quebec independence but Canadian independence. And we have not got it. No country is independent when two-thirds of its economy is owned outside its borders. No country in the world today finds more of its resources held by foreign corporations than has Canada. We shall not achieve independence by breaking this country into fragments. There is a much better hope that Canada can be independent by staying together than by breaking up. One of the first areas to be absorbed would be the province of Quebec where they would lose what has been theirs ever since 1760-the right to their language, their culture and their legal system.
I believe that economic progress is more likely if we have a national government with the constitutional powers necessary to promote economic growth and full employment. You cannot appeal to people in Quebec in connection with the benefits of federalism as long as there is 13 per cent unemployment in that province; they are not going to believe you. The Premier of Quebec says he wants to establish a customs union and common market. I want to point out we already have that in Canada. In the northern half of this continent we have a great free trade area in which goods, people and capital move freely back and forth. When the Premier of Quebec says he wants to have a customs union that is something similar to the European Economic Community, 1 think he should be reminded that the European Economic Community is moving eventually toward political union, not away from it, and that to take any part of Canada out of confederation is to move against the stream of history. It should be remembered that there is little value in pulling out of Canada if it means we are going to have something which is not as good as we have at the present time.
I believe the people of Quebec as well as the people in the rest of Canada will understand that if we have a national
Federal-Provincial Fiscal Arrangements government which applies itself to the economic growth of this country, to solving the problems of unemployment and the disparity between the different regions of Canada, then we are giving Quebec an inducement to stay in confederation.
Finally, I believe in a federal system, because by co-operating together we can attain national standards of health, welfare and education which guarantee all Canadians the basic rights of human well-being no matter in what region they may reside.
My quarrel with the legislation now before us is that it fails to provide equality of opportunity at a time when we need to be demonstrating the worth of Canadian federalism. This legislation is a retrogressive measure which undoes the work which was done by people like the right hon. W. L. Mackenzie King, the right hon. Louis St. Laurent, the right hon. member for Prince Albert (Mr. Diefenbaker), and the right hon. Lester B. Pearson.


Mr. Parent:: And Trudeau.


Thomas Clement (Tommy) Douglas: My hon. friend says, "And Trudeau". I will come to the Prime Minister (Mr. Trudeau) in a moment, if he wants me to. I had the privilege of sitting in federal-provincial conferences with Mr. King, Mr. St. Laurent and the right hon. member for Prince Albert, and 1 sat across the House when Mr. Pearson was prime minister of this country. One of the things that characterizes these four ex-prime ministers of Canada is that they were convinced that if we were going to hold this country together we had to maintain certain national standards so that all Canadians, no matter whether they live, on the Pacific coast, the Atlantic coast, the north or the south, no matter what their language, creed or racial origin, will get fair and equal treatment and that there will be no second-class or third-class citizens in this country. My hon. friend across the way wants me to add the Prime Minister to my quartet. He is heading a government which right now is moving to destroy these national standards.


Some hon. Members:: Oh, oh!


Thomas Clement (Tommy) Douglas: This is a government which is moving backwards to create disparity between provinces, which can only result in resentment and hostility; and if it is carried far enough it could lead to the dismemberment of this country.


Gilbert Parent: What you are saying is not worthy of you. You should know better than that.


Mr. Knowles (Winnipeg North Centre):: Just read Bill C-37.


The Acting Speaker (Mr. Turner):: Order, please. The hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas) has the floor.

February 22, 1977
Federal-Provincial Fiscal Arrangements


Thomas Clement (Tommy) Douglas: Mr. Speaker, the hon. member seems to be getting very excited. I can only assume he has not read the bill; or if he has, he does not understand it. The fact is that this bill will destroy the very thing which since 1945 successive federal governments have been seeking to establish, namely, national standards for the people of Canada by which the federal government, through equalization payments and sharing the cost of programs on a 50-50 basis, could assure that a little province like Prince Edward Island would be able to give its people services that are comparable to the wealthiest province of Canada, the province of Ontario. I have shown, by using the federal government's own figures, that rather then equalizing revenue, the bill before us gives the preponderance of that revenue to the wealthy provinces at the expense of the poorer provinces.
Let me conclude, Mr. Speaker, by saying that if this country should break up-and God forbid that should happen-it will be because we have failed those who have gone before us. This country was founded by men and women who had a dream that it was possible to bring together diverse groups of people with different cultural backgrounds, who spoke different languages but who could live together in a spirit of tolerance and good will. They believed it was possible that the strong would help the weak, that the wealthy provinces would help succour the poorer provinces and that we would build a standard of Canadian living which would be our pride. If we fail to do that, then we are not worthy of those in whose footsteps we follow. My plea to the Canadian House of Commons is that we should make up our minds that we will not allow either apathy or bigotry to destroy the Canadian dream.


Robert Phillip Kaplan: Mr. Speaker, I want to begin by assuring ail members that I am not standing up to disagree with the noble sentiments expressed by the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas). All members, all federalists in the House and in the country, must surely support the goals he has put before us. What I am standing up to say is that this is not a bill which will destroy Canadian federalism. What would destroy Canadian federalism would be to take the kind of position that that hon. member advocated. It is true that we have achieved high national standards in the field of health, the field to which he referred particularly and to which I will return in a moment. But what is the trouble with the socialists in this House is that they have no confidence in the provincial governments to maintain these programs which constitionaily are under their responsibility.
Socialists want to centralize all power. They want Ottawa to determine what should be the level of post-secondary education. They want the federal government to determine what the level of help should be. They want the federal government to determine the way hospitals should be run.


Thomas Clement (Tommy) Douglas: Nonsense.
[The Acting Speaker (Mr, Turner).]


Robert Phillip Kaplan: More centralism is not the salvation of federalism in Canada. The salvation of federalism in Canada is to enable the provinces to do things within their constitutional jurisdictions. And that is what this legislation is about.
It is not a question of money. I am going to come to the question of money in a moment, because the socialists even have that backwards, though thankfully the hon. member for Kingston and the Islands (Miss MacDonald) did not. The hon. member for Nanaimo-Cowichan-The Islands read a chart to try to show-wrongly, I will argue, and as I will demonstrate-the perverse impact of equalization payments.
There is a certain irony in listening to opposition parties as they talk about the government's legislative program. Yesterday I listened to the hon. member for Winnipeg North Centre (Mr. Knowles). I will summarize what he had to say and then read some of his remarks. If this legislation goes through, the hon. member for Winnipeg North Centre-


Stanley Howard Knowles: Mr. Speaker, I realize the hon. member is confused, but he is referring to the hon. member for Winnipeg North (Mr. Orlikow).


Robert Phillip Kaplan: Thank you. If this legislation goes through, he argues, the quality of post-secondary education will go down; student tuition fees will go up; post-secondary education institutions across the country will be threatened, and many will have to close; it will be more difficult for young Canadians to get a good education. Looking at the aspect of health, he says the health of Canadians will be adversely affected by this legislation; their health will begin to deteriorate; high user charges will have to be introduced, he argues; and says it is not far down the road before the quality of medical care will go down. Let me quote a few sentences from what he said yesterday. As reported at page 3271 of Hansard, he said:
The provinces will have to reduce the level of service they have been providing. Fewer young people will be able to attend our universities and community colleges. There will be less of a guarantee of payment for hospital care. People will not receive the same kind of service from their doctors. Either all that will happen or the provinces will have to increase their fees. University fees will have to be increased substantially. It will be necessary to implement a deterrent fee for those entering hospital. It will be normal for people to have to pay a charge to see their doctor.
Doom and gloom, Mr. Speaker. That reminds me of what the Conservative party was saying ten years ago when medicare was introduced. I do not have the appropriate Hansard before me, but I can get it if necessary. They said that if we entered this program the quality of medicare would go down. What has happened? The quality of medicare has gone up. They said doctors would leave the country in great numbers if the program-the changes to which are now of such concern to the socialists-were introduced.
On the contrary, in the last few years there has been a net immigration of doctors under this legislation, not emigration. They argued ten years ago that medical schools and universities would close down and thay young people would stop wanting to be doctors. The opposite has happened. In the last ten years not only have medical schools been as full as ever,
February 22, 1977

but more have had to be built. They said the cost of health care would go way up. What do we find in fact? We find that we put less of our gross national product into health care than the United States, where they do not even have universal coverage. Our system is less expensive than the free enterprise system that the Conservatives tried to retain.
There was the same kind of gloom and doom from the Conservatives ten years ago when the programs were introduced. Now that the government is bringing forward changes consistent with federalism we are hearing gloom and doom from the socialist party about things that will not happen. The level of post-secondary education will not go down, and the quality of medical care will not go down. I doubt if user charges will be introduced, although that will be a matter of jurisdiction for the provinces. That is the constitutional responsibility of the provinces, and it is largely up to them under our federalism to control the quality and level of post-secondary education and medical care that they receive.
I can hear the New Democratic Party getting ready to come back with figures about cost. The change from cost-sharing to tax points proposed in the legislation, they say, takes it out of the power of the poorer provinces to maintain the level of medical services. That is another irony, Mr. Speaker, because exactly the opposite is going to happen. Tax points are far more dynamic and bouyant than costs. It has been shown in the past, and will continue to be true, that the value of tax points will increase faster than the cost of medicare programs and post-secondary education programs. Tax points are something the provinces want; they grow faster than costs.


Thomas Clement (Tommy) Douglas: If you
believe that, give them a revenue guarantee.


Robert Phillip Kaplan: I will come to the revenue guarantee. What about poorer provinces? Their tax points are worth less there than the tax points of other provinces, they say. But this legislation does not just give the provinces tax points; it gives them tax points equalized to the national average. The hon. member for Nanaimo-Cowichan-The Islands read some figures. I do not know where he got them from, but he said they were transitional payments to provincial governments. That is not equalization; and the fact that British Columbia and Alberta were getting the highest transitional payments demonstrates that under the cost-shared programs the greatest beneficiaries have been the richest provinces. In the transitional period they get the biggest benefit because they get the biggest benefit from cost-shared programs, both the ones before us today and all other cost-shared programs. Fifty per cent has to be produced by a province, rich or poor, to get a matching 50 per cent from the federal government. It has been easier for Ontario, British Columbia and Alberta to buy federal help.
The tax points will be turned over to the provinces whether or not they spend the money on these programs. We hope they will spend the money on these programs, but it will be up to provincial voters ultimately to determine the level of services which the provinces provide. It is in them that the constitution has reposed that responsibility.
Federal-Provincial Fiscal Arrangements
Wanting to support federalism that truly works, we are putting tax resources back behind the provinces, which is the level of government that has responsibility over these programs. Tax points are equalized. That is important. We have to look at the correct chart and not at the one the hon. member read on transitional payments. If we look at the chart on equalization payments, we find that when a poor province receives a tax point, if it received less than the national average the federal government-out of the taxes of the rest of the country-will make that amount up to the national average. So tax points for the poorer provinces are equal to the national average. Far from moving away from financial responsibilities for these programs, the federal government retains responsibility for keeping payments equalized to make sure they are as valuable to any particular province as they are on the national average.
Some hon. members may ask why the provinces are not cheering with joy if this legislation is as good a deal as I have described. They are not cheering because they got together- the hon. member for Nanaimo-Cowichan-The Islands paid tribute to them for this-and agreed on the position to present to the federal government.
It was very easy for them to agree on the highest common denominator of the demands of provincial governments. That was not an agreement, Mr. Speaker; it was a shopping-basket that contained the maximum demands of every province. I do not know if it can be called an agreement. The provinces that were concerned about tax points got tax points; the provinces that are poorer and looked to tax points said, "Let's have them equalized up to the highest level, the level of the province that is best off." It is an agreement for the provinces to get together and say, "Let us demand both", and then the demands of those provinces that prefer the cost-sharing programs, the ones that are able to write cheques for 50-cent dollars and expect the federal government to make up the rest of it, are in that shopping-basket as well.
I attended those meetings. 1 attended the finance ministers' conference, then the first ministers' conference, and then the finance ministers' conference that followed-and I am not surprised that the provinces went away sounding angry. They wanted the revenue guarantee to be continued which, when it was introduced, was clearly identified as a three-year transitional program. Then it was extended to be a five-year program. The five years are over and the responsibility of the federal taxpayer to transfer funds to the provinces has ended. 1 am not surprised that the provinces want the program to be continued, but the fact is that the federal government never agreed to continue it. It was put forward definitively as a five-year program. I am not surprised that the provinces are angry, but also I am not surprised that the federal government stuck to its guns and insisted that the guarantee program end after five years.
There is legitimate federal concern about the transfer of tax points. I think that those of us who want to see a vigorous

February 22, 1977
Federal-Provincial Fiscal Arrangements federalism recognize that we need to have a federal government that is capable of moving in and supporting various national programs. When some of the poorer provinces express concern about the number of tax points, what they mean is that as more and more tax points are transferred away, the federal government loses the economic base which it needs to provide assurance of some level of national standards.
I do not know how far Ottawa can go on turning over tax points and still retain the power of equalizing, because equalization is funded out of the remaining tax points that the federal government continues to collect. At some point-and I would argue that we are fast approaching it-the federal government should take the position that this is as far as it will go. We cannot guarantee revenues indefinitely. We cannot equalize to the highest average and still give ourselves the economic base to ensure that this country has national standards in areas where these become endangered. It concerns me that the federal government may lose the economic clout that it needs to do its job.
I am not worried that the poorer provinces will no longer be able to continue to meet their responsibilities under these programs. That argument is a red herring. I am not worried that some of the provinces went home sounding angry, or that all the provinces went home with something to grumble about. They did not get 100 per cent of what they wanted. But if they had received it, they would have emptied the federal resources to such an extent that Canada would have been seriously weakened; we would have lost the power of manoeuvrability that the federal government, at the centre of so large and diverse a country, requires.
We do not expect the provinces to come cheering about this fiscal arrangements act, but what is disappointing is to find the opposition parties dragging out red herrings and attacking them, instead of wondering-in what I would submit is a more critical issue-where the federal government goes from here. Is our federal tax base adequate to discharge our responsibilities in a diverse country which is threatened, as we all know, by all kinds of internal and external problems?


Arthur Jacob (Jake) Epp: Mr. Speaker, I am pleased that I can participate today in a debate on this bill on federal-provincial fiscal arrangements. Members of the House are in a difficult position as we debate this bill, in that we are facing a plan which has already been agreed to by 11 persons, namely, the first ministers of every province, and the federal Prime Minister (Mr. Trudeau). So we are facing a fait accompli. We are really asked to give rubber-stamp approval to something that has been hammered out behind closed doors.
I think I understand that much of the negotiation that takes place between the federal and provincial governments must take place behind closed doors. Obviously, every one of the persons involved comes to the bargaining table with a plan of what they would like to see incorporated in any agreement. Also, I am sure, in their more realistic moments-after they have looked at the losses-they say, "This is what I must have in order to go back to my provincial electors and say to them
(Mr. Kaplan.]
that I have bargained in good faith, and this is the best I could get".
I understand that. But what I feel is basically wrong with the approach of the government is that at no time prior to the negotiations were we given, in the House, an opportunity to discuss the broad outlines of what we are debating. All we can do now is say "Yes" or "No". We are in the same position in which the provinces found themselves when they were told, "Here is the deal-take it or leave it. But we have decided that this is what the deal will be". I know, as I look at members of the House who have attended these negotiations personally, that the federal government proposed a program and sugar-coated its proposals in such a way that the provinces had no alternative but to opt in. However, once having opted in, as the years went by the rules were changed-again by the power of the federal government. The government wonders why there are strains in federalism. I think it is self-evident. A strain is bound to occur in the system if changes are brought into the rules of the game halfway through the game which was played in good faith.
There is no question that the provinces will have to bear an increased burden. Not only will there be an increased burden on the provinces but there will be an increased burden on the municipalities. We all know that the municipalities have not seen an appreciable increase in the base on which they can collect taxes. It has been primarily the municipal land tax on which they have relied. Also, throughout Canada they have gone to their provincial governments and said, "If we are to provide the basic services of transportation, education, and the basic infrastructure to run municipal organizations, we will need more tax points from the provincial governments". But the provinces do not have the ability to bring more money to municipal affairs. In fact, the Manitoba government desperately tried to project to Manitobans the financial straits in which the provincial government finds itself. In Manitoba 40.5 per cent of the federal tax is for the provincial government and another 2 per cent goes to the municipal governments, for a total of 42.5 per cent. The provincial rate is 42.5 per cent of the federal rate. Already an attempt is being made to project the fact that the provinces will not have the ability to give municipalities the resources which are needed for services.
In this discussion I want to give the House my views on how I see the federal state operating. I want to do this not in a partisan manner but to present to the House the feelings of a person who has lived in western Canada all his life and who is, first of all, a Canadian. I am sure all members of this House are in that position, but if we are to understand the federalist system and if we are convinced that unity must be preserved we must also be bold enough to present to the House the position our constituents back home are taking. Having said that, how do we see our responsibility, as federal officials, to bring to the attention of our constituents the reasons Canada should remain a country and, why unity is so desperately important and the federal union must survive?
February 22, 1977

The very fact that Canada is a federalist state already should be an indication to all of us that we have a unique situation in this country. The fathers of Confederation did not choose a unitary state. When only four provinces were joined, a federalist state was created. It was recognized then that the various parts did not have the same background or the same language, and while their first aspiration was a united country, they also knew that that country would not survive if the decisions of a central body were to be forced on the collective parts. The very fact that we have a federalist state demands from all of us that tolerance has to be shown and, especially in a federalist state, that need for tolerance is extremely important.
In 1968 the Prime Minister came to power. He was elected by the majority of Canadians. I think all of us would admit that he was the repository of a tremendous amount of good will throughout the country. In fact, even those of us who did not support his party in 1968 had to admit that many people in our areas supported the Prime Minister and what he stood for.


Mr. Brisco:: How times have changed!


Arthur Jacob (Jake) Epp: Indeed, how times have changed! But I think we would all admit that that was the case in 1968. The Prime Minister said very clearly at the time that he was going to bring Quebec into the mainstream of Canadian life. The majority of Canadians accepted those words at face value, hence the election of the Prime Minister. That question has dominated Canadian affairs for the entire tenure of the Prime Minister. What have been the results? In a long and wide-ranging article which appeared in the Economist dated February 12, 1977, the writer went into great detail not only with regard to Canada's federalist future but also with regard to an analysis of the various parts of Canada. The writer said this about the Prime Minister's record:
Canada is not a unitary country and never has been; it is Mr. Trudeaus tragedy that he has failed to make it one. Perhaps he has exhausted his role as a leader of all Canada by concentrating too exclusively on federal solutions for Canada's problems, when the provinces have been demanding more room in government for themselves.
Further in the article the writer said:
From the Pacific until one reaches Ontario, Ottawa and Mr. Trudeau are anathema-focal points for a paranoic hatred of so much that the federal government has done to redistribute their wealth to the poorer provinces east of the Ottawa valley and to force them, as they say in their morbid shorthand, to learn French when they did not want to. To this observer, federal Canada seemed vulnerable-


An hon. Member:: Who wrote that?


Arthur Jacob (Jake) Epp: At the beginning of my remarks I said I was going to try to show the House the point of view of western Canada on how to bring about a united country. The carping of hon. members opposite will not help in any way. However, I want to continue what I have to say. What about the view which has been expressed so frequently in the last few days? In the press there has been an overabundance of speculation that in the west there is no recognition of the aspirations of Quebec. I was deeply moved by the comments of the hon. member for Lisgar (Mr. Murta) yesterday. He spoke as a western Canadian and
Statistics Act
put forward his view, and the view of his constituents with respect to Quebec staying in confederation, very clearly. As western Canadians, we want Quebec in confederation.


Some hon. Members:: Hear, hear!


Arthur Jacob (Jake) Epp: As western Canadians, we also want to be part of confederation. That is Canada.


Some hon. Members:: Hear, hear!


Arthur Jacob (Jake) Epp: With great respect to hon. members opposite, I say that more attention will have to be paid to what the west is saying-although not by way of blackmail. It is saying it has some legitimate grievances and legitimate aspirations. We in the west believe that we can contribute to the Canadian confederation.
Mr. Speaker, if I may call it five o'clock, I will continue at eight o'clock.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: Pursuant to Standing Order 40, it is my duty to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Carleton-Charlotte (Mr. McCain)-Fisheries- Extensive herring kill in Bay of Fundy-Request for determination of cause and assistance to fishermen; the hon. member for Humber-St. George's-St. Barbe (Mr. Marshall)-Transport- Request of Atlantic provinces for funds to improve TransCanada Highway-Government position; the hon. member for Surrey-White Rock (Mr. Friesen)-External Affairs-Cuba-Suggested reconsideration of relationship in view of support of Rhodesian guerrillas.

It being five o'clock, the House will now proceed to the consideration of private members' business as listed on today's order paper, namely, public bills, private bills and notices of motions.


PRIVATE MEMBERS' PUBLIC BILLS
Mr. Deputy Speaker:: Motion No. 12, in the name of the hon. member for Simcoe North (Mr. Rynard).


Some hon. Members:: Stand.


Mr. Deputy Speaker:: The motion stands at the request of the government.

February 22, 1977
Statistics Act STATISTICS ACT


AMENDMENT TO PERMIT PERSONS WHO OBJECT TO ANSWERING QUESTIONS TO DO SO WITHOUT PENALTY, ETC.
Flora Isabel MacDonald: that Bill C-213, to amend the Statistics Act, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
She said: Mr. Speaker, the purpose of Bill C-213 is to remove from the Statistics Act the penalty provisions contained in section 29 which are directed against those individuals who refuse to answer Statistics Canada questions. The two exceptions-and I emphasize these-would be questions contained in any census of population, or agriculture. As the law presently stands, persons who refuse, or neglect to answer virtually any questions posed by Statistics Canada, are subject to criminal conviction and a maximum fine and/or a penalty of $500 and three months' imprisonment, respectively.
Before I proceed further, Mr. Speaker, I should like to announce that it is my intention to propose an amendment to Bill C-213 at committee stage. It has been brought to my attention that the effect of Bill C-213 as it presently stands would be to exempt corporations as well as individuals from the necessity of complying with requests for information from Statistics Canada-information other than, of course, that which is solicited for the purposes of a population or agricultural census. It was not my intention when drafting Bill C-213 to have its relieving provisions apply to corporations. This unintended consequence would occur as a result of the definition of the word "person" in the Interpretation Act. According to that act, the word "person" includes a corporation. I will, therefore, be seeking at committee stage an amendment to Bill C-213 which would limit the application of its relieving provisions to individuals.
I have been advised by a spokesman from Statistics Canada that penalty provisions of the kind contained in section 29 have been a part of the legislation under which Statistics Canada and its predecessor, the Dominion Bureau of Statistics, have operated since the latter's creation in 1918. Penalties of this severity may have been appropriate in the early years of the operation of this agency when only minimal census details were requested. However, the times-and Statistics Canada- have changed. Statistics Canada is now a much more sophisticated data-collecting instrument. It is no longer concerned with merely the minimal details of the population of Canada- for example, the age, sex and number of its citizens-but is concerned with a host of other matters as well.
There is not merely a population census every five and ten years, but a whole series of complex surveys which are conducted on an almost continuous basis and which relate to areas such as the level of unemployment and the consumer habits of Canadians so far as food and housing are concerned. The recipients of these questionnaires are chosen at random by computer and are often required to complete detailed surveys, some of which exceed 16 pages in length and require consider-

able time to complete. People have written to me complaining that it has taken them two or three hours to complete lengthy questionnaires. In the case of the so-called labour force survey, the recipient must submit to not just one questionnaire but to a series of monthly questionnaires for a period of six months.
The questions contained within these surveys often demand of the citizen very detailed information on matters which may be of privacy to him, or her. One recent survey, for example, requested information from the householder as to the amount of alcohol and tobacco consumed. Another requested information as to the degree to which child care facilities were utilized by the respondent. The former of these two surveys, the food expenditure survey of 1974, also contained questions relating to the ages, salaries, professions, mortgages, stocks and bonds, land interests and, finally, food expenditures of the respondent and his family. This last item contained questions dealing with the amounts of money spent on meals eaten out, dry cleaning, laundry, reading material, personal care articles, the estimated cost of home-grown vegetables used, and gifts received. Space was even included for the names of the stores where the items were bought, as well as their location. The housing survey of the same year was equally detailed and contained, for example, a series of questions relating to the nature of the bathroom facilities contained within the respondent's home.
As one can see from these examples, these surveys can be extremely detailed and often contain requests for information of a personal nature which the recipient of the questionnaire, for reasons of personal privacy, may wish not to reveal. The problem is particularly acute in the case of rural and small town areas where the surveyor may be an acquaintance of the respondent. The surveyor, although he is sworn to secrecy and is subject to heavy penalties if it can be proved that he violated this confidentiality, is required, depending upon the nature of the survey, to either direct the questions verbally to the householder, in which case he also records the responses of the householder, or scan the questionnaire after it has been completed by the householder.
These practices can, naturally enough, cause a great deal of consternation among respondents. If a respondent is reluctant to answer the survey as a result of these procedures, the surveyor is-in the case of some but not all of the surveys- instructed to advise the householder that he can send the completed form directly to Statistics Canada rather than having it pass through the hands of the surveyor. I am aware of this practice. This option is not, however, sanctioned by law. It is merely a matter of policy which could, where it exists at all, be withdrawn at any time by Statistics Canada. Nor, as I am informed, is the surveyor in these cases instructed to advise the respondent of the option at their first encounter, but only after some hesitation has been expressed by the respondent.
According to Statistics Canada, the purpose of the penalty provisions within the act is to ensure that the validity of statistical information which is collected is not distorted by the refusal of some recipients to respond. But Statistics Canada also admits that the majority of Canadians contacted are more than willing to co-operate with the requests for information
February 22, 1977

without the provisions of section 29 even having to be mentioned. This raises the question why the penalty provisions are required at all. If the refusal rate is indeed so low, why is it necessary for the threat of prosecution to be used in order to coerce the small minority of Canadians who refuse, on grounds of principle, to reveal information which is in many cases of a highly personal nature? Why could not Statistics Canada simply substitute the reluctant householders with others who show no reluctance? And if the refusal rate is indeed so low, Mr. Speaker, how real is the danger of statistical distortion in the first place?
Another point I should like to raise is the extent to which section 29 is actually used as a threat. According to Statistics Canada the interviewers are not allowed to threaten the respondent with legal action. However, if they are asked they will indicate, and I am quoting directly a Statistics Canada official, "the Statistics Act provides a legal authority to collect the data." There are two difficulties with this statement. The first is that what Statistics Canada tells its surveyors may not be what they in fact do.
In a national survey, an undertaking of some magnitude, it is almost inevitable that a few of the surveyors chosen, no matter how selectively they are screened, will go about the performance of their duties in a manner which is heavy-handed and which would not be condoned by their superiors. The correspondence I have received from constituents and other concerned Canadians would certainly bear this out.
The second point is that the distinction between the threat of prosecution and merely having pointed out the legal authority by which Statistics Canada collects information is a very fine and subtle one. Most Canadians are law-abiding citizens who genuinely desire to fulfil their obligations under the law. Knowledge that they are breaking the law and are subject to prosecution is liable to be, for the ordinary citizen, as compelling a reason to comply with requests for information as an actual threat of prosecution itself. In fact, for many Canadians knowledge that they are breaking the law is a terrifying experience. The final point I would like to raise is that Statistics Canada indicates that prosecution of individuals pursuant to section 29 occurs very rarely and only after a great deal of deliberation by the agency. The last prosecutions arose out of the 1971 census and were ten in number.
Statistics Canada states that as a matter of policy prosecutions are laid only in regard to those refusals that relate to a census of population. If this is indeed the case and prosecutions are, as a matter of policy, brought only in regard to refusals which arise out of a population census, why ought not the law to be brought into line with the policy? Why ought we to retain in our laws extensive powers which officials say they do not use but which continue to exist nonetheless and could presumably be used, or abused, by them at some time in the future?
We must, in my view, be constantly on guard against provisions of this kind. We ought never to be content with the
Statistics Act
assurances of public officials that laws, though undesirable and unnecessary, will be administered by them in a prudent fashion. If laws contain provisions which are unused and superfluous, those provisions ought to be removed from the law once and for all.
I have no quarrel with the aims of the surveys undertaken by Statistics Canada. Indeed, I would hope and encourage Canadians to co-operate to the fullest extent with Statistics Canada in its collection of data. The surveys it undertakes provide a wealth of very valuable information which is useful in determining the social and economic policies that will be desirable for Canadians in the future. This information is of use not only to governments but also to a multitude of private individuals and institutions. However, at the same time we must have a corresponding respect for the freedom of the individual. It is necessary in this area, as in others, to strike a balance between the legitimate needs of society and the rights of the individuals that comprise it. Unfortunately, this balance has in recent years swung rather drastically in favour of the bureaucracy. The federal bureaucracy has, as we are all painfully aware, grown at an enormous pace and now involves itself in virtually every aspect of our daily lives.
We have before this House a bill, the human rights bill, which attempts to provide a certain degree of protection against the infringement of civil liberties. One of the most prized of civil liberties, and the one that is the subject of this bill, is the right to one's privacy, the right not to be compelled to reveal personal information against one's wishes. It is for this reason, Mr. Speaker, that I have introduced Bill C-123 to this House. I believe that private individuals ought to be able to withhold from Statistics Canada information about their personal lives which is not required for a population or agricultural census. To require otherwise is to pay lip-service to the concept of civil liberties. In the final analysis, Mr. Speaker, it boils down to a contest between statistics and individuals; and in my view statistics must never be permitted to become more important than individuals.


Some hon. Members:: Hear, hear!


Mr. Hugh Poulin (Parliamentary Secretary to Minister of Industry, Trade and Commerce):: Mr. Speaker, it is a pleasure to join in this debate on the bill presented by the hon. member for Kingston and the Islands (Miss MacDonald). I have served with her for some years on the Standing Committee on Justice and Legal Affairs and I know how sincerely she is a proponent of civil liberties. I agree with her in many of her efforts in that regard, and commend her for them. I was pleased to see the hon. member indicate early in her speech that she would bring an amendment to this bill when it reaches committee. The effect of the bill, therefore, would not be to exempt corporations from the reporting requirement that they are now subjected to in the Stastistics Canada Act. If this bill reaches committee, we would certainly agree with that kind of proposal.
Canada's statistical system has for many years been based on two important corner-stones. On one hand there exists a

February 22, 1977
Statistics Act
solemn guarantee that the information provided by respondents will be treated with absolute confidentiality and will never be released to anyone outside Statistics Canada in a form which could identify the respondent without the prior written authorization of the respondent. Statistics Canada employees are sworn to secrecy and severe legal penalties are prescribed for any breach of confidentiality. During the years in which Statistics Canada has served the Canadian people there has never been any substantiated case of a Statistics Canada employee having intentionally violated this principle. The second corner-stone of the statistical system is that in return for this solemn guarantee that information about them will be treated in strictest confidence, individual Canadians and Canadian business entities have a statutory obligation to respond to legitimate statistical inquiries carried out by Canada's central statistical agency.
If I may divert for a moment, may I say how important it is to Canada and to the factual economic base of information that is necessary that we have the greatest trust and faith in Statistics Canada. Recently, during the time of the estimates of the Department of Industry, Trade and Commerce, there was an inquiry into some matters of Statistics Canada. After those two meetings, where full opportunity was given to members on both sides of the House to question whether there had, in fact, been any leak in confidential information, no such evidence appeared at any time.
Subsequent to that, in my capacity as parliamentary secretary to the minister responsible I had further occasion to go into the allegations and surrounding circumstances in great detail. As a result of what I was able to find out, I am confident that Canada is well and truly served by an agency of which we can all be very proud. The confidentiality of information, the high standard of professional excellency insisted upon by the chief statistician. Dr. Kirkham, and, indeed, the high standard of professional excellence of all the people in that organization can lead Canadians to have pride and certainty in the accuracy of the organization not only in relation to the results but also in relation to the very up-to-date and scientific methods and procedures used by the agency in the conduct of its business.
Canadians should realize that notwithstanding certain innuendos levelled against the organization from time to time, none of them has ever been proved. On the contrary, these allegations have only demonstrated that Statistics Canada has been conducting itself according to the highest standards, and we can all be proud of it as Canadians. The overwhelming majority of Canadians, far from resenting the compulsory nature of Statistics Canada surveys, readily co-operate by providing basic data for the production of important national statistics. This is undoubtedly due to the importance Canadians attach to good statistics as a basic element in public and private decision-making and for informed discussion of the public issues that concern them.

Although the overwhelming majority of Canadians readily co-operate with Statistics Canada, there are nevertheless significant numbers of individuals who are not prepared to cooperate voluntarily. In some cases this reluctance is based on the legitimate concern over the right to individual privacy. Statistics Canada is most sympathetic with this position and recognizes that its legislative authority is not a licence to bombard the people of Canada with frivolous, irrelevant or offensive inquiries. But in this day and age there are certain kinds of basic information which government, be it federal, provincial or municipal, simply must develop as a basis for policy and program responses to the many complex problems of our society. In order to address these problems-sometimes just to identify them-there is no substitute for good information. It is no easy task, in a democratic society, to balance these two conflicting principles of the right of the individual to privacy and the need to obtain certain essential information.
If I might digress for a moment, I find a serious inconsistency in the position of the hon. member for Kingston and the Islands. On one hand she is proposing an amendment to the Statistics Act which could have a serious impact on response rates to Statistics Canada surveys and which could, in turn, jeopardize the reliability of important economic and social indicators. At the same time, her political colleagues are frequent critics of the reliability of these same indicators and champions of improved statistical reliability.
There is one important point 1 would like to stress. This government is not opposed in principle to the concept of making the response to certain official statistical surveys voluntary. Indeed, at the present time officials of Statistics Canada are studying the scientific and technical implications on the quality of data that the introduction of voluntary responses would have. It is possible that in the future some Statistics Canada surveys could be conducted on a voluntary basis. However, to introduce voluntary response to virtually all surveys, as this bill proposes, without first having carefully analysed the resulting impact on the quality of the statistics, would be an irresponsible leap into the dark with possibly devastating consequences for the statistical system.
Furthermore, Mr. Speaker, in the area of business surveys, where there are obvious costs associated with compiling the necessary responses to Statistics Canada surveys, it could not be assumed that businessmen would be willing to continue incurring such costs when it is not legally binding on them to do so. It is true that those businessmen who are themselves users of statistical data and recognize their value would probably continue to respond to surveys. But there are many businessmen, particularly those who own or manage small businesses and who make less direct use of statistical data in their daily affairs, who would simply not participate in surveys if they were voluntary.
This government recognizes the necessity of reducing the paperwork burden on businesses, and especially on small businesses. However, the solution is not to simply eliminate surveytaking or to shift overindiscriminately to voluntary response. Information relating to small business is critical to the compi-
February 22, 1977

lation of statistical series on such subjects as output, employment, prices and trade. Similarly, insofar as these series constitute components of the national income and expenditure accounts, small business data contribute to the production of our aggregate economic indicators.
With the creation of the new Ministry of State for Small Businesses, this government has given a clear indication that it is concerned about the paperwork burden which falls on the small businessman. Statistics Canada, for its part, is actively pursuing ways and means of reducing its share of this burden. The use of administrative records such as income tax returns as a substitute for statistical surveys is a concrete example of such a reduction. This year alone, Statistics Canada will be able to exempt between 70,000 and 75,000 respondent businesses, mostly small businesses, from various surveys.
Another means of reducing the response burden is by using sample surveys instead of the traditional complete consensus. However, when sample surveys are used the importance of obtaining a response from every member in the sample is all the more critical since in such a situation each respondent represents several hundred others. Again I must emphasize that to introduce the concept of voluntary response to such surveys without first analysing the potential impact very carefully, and subsequently making necessary adjustments to compensate for any changes in response rates, would be irresponsible.
In summary, Mr. Speaker, the possibility of introducing voluntary responses to some Statistics Canada surveys is under examination by officials of the department who are carefully assessing the impact such a change would have on the reliability of Canada's official statistics. In addition it must be stressed that Statistics Canada is very sincerely concerned with the response burden imposed by its survey-taking activity and is actively pursuing several specific programs designed to reduce this burden. Finally, we should not forget that although Canadians have a statutory obligation to provide responses to official surveys conducted under the authority of the Statistics Act, they are, by this very act, provided with an iron-clad guarantee that the confidential information they provide will be carefully protected and will never be released in an identifiable format without prior express written permission from the respondent in question.
As a result, Mr. Speaker, I would hope that other hon. members will join with me in defeating this bill, one which, though superficially innocent, could be potentially detrimental to our national statistical system.


Mr. David MacDonald (Egmont):: Mr. Speaker, when I first read the bill introduced by the hon. lady from Kingston and the Islands (Miss MacDonald) and then listened to her words of wisdom, I wondered whether there would be any further speakers because I assumed the path of sanity and responsibility on the part of the government would simply be to accept the measure and refer it to the committee along with the amendment my hon. friend indicated would be proper at that stage. Instead, we have been treated to one of the greatest pieces of
Statistics Act
nonsense I have heard during private members' hour for some time.
I think much too highly of the hon. member for Ottawa Centre (Mr. Poulin) to believe that he himself was the author of the speech he presented to us. When he launched into his paean of praise for Statistics Canada it was obvious that it must have originated with that organization itself, because no one else, not even his own department, would indulge in the kind of nonsense which has taken up the time of this House for the last ten minutes. When the hon. member went on talking about the accuracy of results, scientific techniques and the up dating of Statistics Canada, I wonder that even the author of that purple prose in Statistics Canada could have said it with a straight face, realizing over the past few months and years the numerous instances of the many obvious weaknesses that exist with respect to the gathering of statistics in this country.
I come from a province which has been plagued for years with this fact. I am sorry I did not bring the material along and send it over to the parliamentary secretary, but I would remind him that they had to go to the point of including at the bottom of the page of statistics that related to Prince Edward Island the note that their own figures were indeed so insufficient that they were not prepared to stand by them.
I had a couple of classic examples of this in the last few months, and I think the one that really struck me as the most ludicrous was the situation in which we were asking Statistics Canada for information as to the number of housing starts in Prince Edward Island. They arrived at some mysterious figure by some kind of ethereal survey which they conduct on a regional basis in which they compute the number of housing starts, and I knew from the figures they reported that they were so wildly at variance with reality that no person in their right mind would accept them even for a moment.
What I did, Mr. Speaker, was what any person on Prince Edward Island would normally do. I telephoned the Prince Edward Island Housing Authority which records each and every month the absolute number of housing starts on Prince Edward Island, because you cannot build a house on P.E.I. today unless you first of all receive permission or a licence from the provincial government. In other words, at this very moment any individual can telephone the authority and get the absolute number of housing starts. This is something which has apparently not yet seeped through to Statistics Canada, which is still indulging in its own kind of crystal ball gazing with respect to housing. That is only one recent example, Mr. Speaker.
We have talked over the past few weeks of the unemployment problem. It is unfortunate that the Minister of Manpower and Immigration (Mr. Cullen) did not hear this wonderful eulogy about Statistitics Canada or he might have wanted to speak ahead of me. I have received numerous letters indicating that there is no way that they are basing their present program of job creation and the tuning of the amount of money to be spent in various constituencies on the facts provided by Statis-
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tics Canada because they are so wildly inaccurate. I assume that the Minister of Manpower and Immigration talks to the Minister of Industry, Trade and Commerce (Mr. Chretien) and that they do not keep these kinds of juicy bits of information from each other. I know that the parliamentary secretary, in computing his own LIP program, would not for a moment rely on Statistics Canada information with respect to unemployment in his constituency. If he did, he would not be sitting in his seat very comfortably for very long. The list is long, Mr. Speaker.
I must make a confession here. I may not be able to get off Parliament Hill this evening, because I can think of at least two instances where apparently I broke the law.
I treat this particular move by the hon. member for Kingston and The Islands as a very modest move indeed. What it does is to try to bring modern law to some point of sanity. For the parliamentary secretary to treat this as being superficially innocent is for him to engage in some new form of misdirection which is surely beneath both his capability and his responsibility.
When I first established my constituency office in my constituency of Egmont, I recall that for some reason known only to the forces at Statistics Canada we were suddenly on their mailing list to provide monthly employment surveys about, "our industry". This mystified my constituency secretary, who was a direct employee of the constituency office, because we were not operating any major commercial enterprise. Yet faithfully, month after month, Statistics Canada would send this form letter to the Egmont office, company, or what have you, asking us to give them the following information: "How many employees have you on your payroll? What were the transactions during the past month?"
My secretery, being a very responsible sort of person, asked me what she was going to do about this. So I said; "Do with it what you do with all the rest of the junk mail that comes in- throw it in the wastepaper basket". I can see I was encouraging my secretary to break the law, but I thought it would be much better to break the law in this instance than to return forms which would be absolutely useless to whomever was the anonymous official at Statistics Canada who was circulating this kind of monthly questionnaire which had no relevance to my constituency office in the constituency of Egmont.
Because of the kind of society we have today, Mr. Speaker, it is obvious that we need a throrough overhaul of much of the methodology that is used in gathering statistics. A classic example of this occurred during the last major census in 1971. Hon. members will recall that the census was to take place during the month of June. During that month all of the census gatherers were sent out across the country. Now, Mr. Speaker, it so happens that during that month of June I and my family moved from Ottawa to Prince Edward Island, as we normally do. Before we left we had a visit from a person from Statistics Canada who asked us dutifully to fill out the form she supplied, which we subsequently did. Then a few days later when we arrived in P.E.I. we were visited by the local statistics gatherer for census Canada in P.E.I. and were again asked to

complete the form. When I protested and said I had already completed one in Ottawa and thought it would be a little redundant if we became statistical reportees for the province of Prince Edward Island, she told us in no uncertain terms that it was an absolute requirement, that we were residents of Prince Edward Island and that we should file a full return for the five of us living on P.E.I. This we again dutifully did.
If that kind of rigidity, and the kind of rigidity expressed today by the parliamentary secretary, are what we are up against, Mr. Speaker, then the hon. member for Kingston and The Islands has merely touched the tip of the iceberg. We have a much more serious problem than any of us realize. I have some belief that this may well be the case.
A few years ago, Mr. Speaker, I was somewhat disturbed, when attempting to grapple with a good, sound statistical base for the Atlantic provinces in order to deal with our ongoing problems of economic and social disparity, to realize that so much of the information that we required was not available to us because so far we had not updated our social and economic fact gathering sufficiently to give us a much clearer picture of the chronic and structural problems facing the Atlantic region.
It is one thing for individual members to be faced with a series of forms which do not add anything worth-while to the over-all statistical base of the country. But it is another thing not to be conscious of the fact that without good statistical information, as the parliamentary secretary suggested, we would not be able to do our job effectively as parliamentarians and legislators.
It seems to me that if the only response is that we provide criminal penalties for those who do not respond to questionnaires presented to individuals, then the department, or this particular agency of government, is in a very serious state indeed. I believe that we are faced with a situation in which it is not a question of whether or not the department has means of harassing people. I fail to be convinced by the argument that the parliamentary secretary brought forward when he said that there would be a very serious impact on response rates. I have to ask the parliamentary secretary in all seriousness, what kind of documentation, what kind of support, does he give for that? It seems to me that the response rates are going to be determined in almost all cases by the willingness of the individual to provide information which he knows is in the best interests not only of himself but of his community, province, and country.
Surely if the only argument that Statistics Canada has with respect to the information that is going to be gathered, is that if you do not provide the information you are going to be breaking the law, and you will be subject to the laying of criminal charges, then Statistics Canada will become poverty stricken in its approach to people and in the services that it provides to Canadians. Therefore I would hope, Mr. Speaker, that what has been said by the parliamentary secretary this afternoon are the ill-considered remarks of some PR flack in StatsCan and not the thoughful response of the hon. member or, I would hope, of a minister who believes it is in the best interests of this country to have a Statistics Canada branch
February 22, 1977

which is functioning responsibly, sensibly, and also with proper respect for the human and civil rights that have been properly represented here this afternoon by the hon. member for Kingston and the islands.


Gilbert Parent: Mr. Speaker, I was almost intimidated by the hon. member for Egmont (Mr. MacDonald) and nearly shied away from speaking, but seeing that he said he thought no one was going to speak after the hon. member for Kingston and the Islands (Miss MacDonald), and then himself proceeded to do so, I decided that I would too.
[ Translation]
On studying Bill C-213, one could get the impression, Mr. Speaker, that a concerted effort is being made to harm, annoy, harass and even threaten the Canadian public, that a plan is even now being implemented or that steps have been taken for Statistics Canada to do so. Nothing could be further from the truth.
In all its activities, whether they are directed towards industry, employers or Canadian individuals, Statistics Canada is endeavouring, above all, to get the voluntary co-operation of the respondent, and not to threaten him with penalties as stipulated in the Statistics Act.

I think hon. members would agree that the record of Statistics Canada over the years for producing high quality, timely, and relevant statistics speaks well for the level of co-operation the agency has been able to obtain. There is a motto at Statistics Canada: "The respondent is our most important resource". Better than anything else I think this summarizes the approach the agency takes to the Canadian public.
The requirements related to compulsory response outlined within the Statistics Act have been in effect for some 60 years since the early history of legislation pertaining to the production of statistical information. Those who object to compulsory response may be overlooking, as has already been discussed by my colleague, the complementary provisions of the Statistics Act which outline the privileged relationship between the agency and the respondent and provide an absolute guarantee of the confidentiality of individual information. In support of such guarantees, employees of Statistics Canada are required to take an oath of secrecy and they too are subject to severe penalties for breaching the trust reposed in them. The hon. member for Kingston and the Islands mentioned that this was not the answer, and the hon. member for Egmont said we should not be penalized in any way for trying to gather information.
In 1976, if I recall correctly, surveys were sent out in my riding of St. Catharines by Statistics Canada. I know a few people who were involved in that exercise and I asked them what the response was when they went to the homes with the survey forms and asked people to fill them in and return them. The initial response was about 40 per cent.
Statistics Act


David Samuel Horne MacDonald: Did they prosecute the rest?


Gilbert Parent: They did not prosecute but they had to go back and ask people to fill them in, and the majority did. There was no prosecution that I know of but I guess in this, like everything else, we are quite cavalier about laws that are made when we attach penalties to them, yet in any country if we relied on the average citizen he would co-operate. What I am saying is that when we bring in laws that have penalties to back them up, it is not the worst thing in the world so long as the information requested is truly necessary.
I agree with hon. members that information should be available to us, and the questions should be reasonable and geared to help people carry out their duties and not simply for the sake of gathering statistics. I think we should be able to gather the information necessary for running this country.
The hon. member for Egmont had a question about housing starts in Prince Edward Island and he went to Statistics Canada. Why did he not go to the provincial housing authority in the first place if he knew they had the information? I agree that we should be upgrading our system of gathering information, but to say that because Statistics Canada is going about it the wrong way it should be scrapped, is something with which I cannot agree.
Statistics are vital to many areas of planning and decisionmaking within the business community and government. An important example of how statistics directly affect individual Canadians is the case of labour contracts, pensions, and family allowances which are based upon escalation clauses keyed to the consumer price index. Clearly the production of these and other statistics which affect the well-being of all Canadians necessitates the gathering of information and this, in turn, requires inputs by citizens. I am confident that those who furnish this information do so willingly, recognizing the net benefit to them in the long run.
As I have said, the compulsory response provisions of the Statistics Act have been carefully counter-balanced by confidentiality provisions to prevent the disclosure by Statistics Canada of information which could be related to an identifiable respondent. These confidentiality provisions have always been scrupulously respected by Statistics Canada. Not only are these very rigorous security measures but, more important, the great majority of employees take their responsibilities very seriously. My colleague pointed out earlier that in all the years Statistics Canada has been in operation no one has ever been proven to have knowingly given out information which would in any way hurt a respondent.
In case it should seem that Canada is out of step with the rest of the world, let me say that in other countries such as the United Kingdom, France, West Germany, and Sweden, all of which have highly respected statistical systems, their statistical legislation also finds it necessary to embody similar provisions related to compulsory response, coupled with the necessary procedures for prosecution and fines, but truly only as a last resort.
80010-3%

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It should be pointed out again that a refusal in a sample survey is not merely the refusal of an individual to furnish information solely about himself. The individual who refuses to answer a sample survey is denying information about hundreds or, in some cases, thousands of people from the particular group which he represents. Statistics Canada does not institute legal procedures at the initial point of refusal. The agency's policy has been one of co-operation and assistance, with a final resort to persuasion in order to obtain a high level of response. Though prosecution is rare, it has to be available to the agency as an ultimate sanction in order to maintain the high response rate necessary to the production of meaningful statistics. An example will serve to illustrate this point.
Several years ago a survey was conducted with a universe of some 68,000 corporate respondents. After an initial response of 61 per cent, a letter was sent requesting the remaining 26,000 non-respondents to complete the survey questionnaire. This resulted in a further response of 70 per cent, leaving a balance of some 8,000 non-respondents. A second letter indicating the legal requirements to respond produced a further response from 58 per cent of those non-respondents. Again, subsequent correspondence produced a further 71 per cent response from those 3,000 remaining non-respondents. Of the less than 1 per cent balance of non-respondents, a certain number had gone out of business. However, after a review, 20 were considered for prosecution, and the Department of Justice was consulted. The Department of Justice announced that prosecution proceedings would be commenced. Then all but three corporations responded, and these three were prosecuted and fined for non-compliance with the Statistics Act. Therefore we are looking at three corporations, out of a possible 68,000, which were prosecuted. We hope that it was not the stick that brought the others to a final response, but if the stick were not there I do not think the response would have been a complete one.
At one point Statistics Canada discontinued prosecution proceedings for a large annual survey with a view to relying upon respondent co-operation, as the hon. member for Egmont said. After several years it was found that response rates had begun to deteriorate sharply, with the result that prosecution procedures were reinstated. Even though the final stage of prosecution has not been necessary to obtain a high response rate, it is evident that a system of law which does not provide for sanctions would weaken Statistics Canada's historical success in producing meaningful statistical information.
As my colleague has mentioned, there are cases where it may be feasible to introduce voluntary response as a method of conducting some surveys, and officials are carefully studying this question. However, I think the evidence I have just outlined confirms the position stated by my colleague that there could be a serious negative impact on the quality of statistics produced by Statistics Canada if the provisions in the Statistics Act to compel response were suddenly eliminated.

I might add that the real losers, if such a deterioration took place, would be the Canadian public. It is not inconceivable that incentive grants, certain transfer payments, pension and family allowance indexing, collective bargaining, and a host of other activities and programs would be adversely affected by a deterioration in the quality of the statistical indicators produced by Statistics Canada. These activities affect the lives of literally millions of Canadians, and I am therefore hard pressed to understand the cavalier way in which the bill under consideration appears to deal with this issue. There is no mention, either in the bill or its accompanying explanatory note, of the possible impact of the bill on response rates and data quality, and I therefore assume that the hon. member for Kingston and the Islands is simply unaware of the possible ramifications of her proposal. It is for these reasons therefore, Mr. Speaker, that I would urge, as has my colleague before me, that members of this House reject this ill-conceived bill.


Mr. D. M. Collenette (York East):: Mr. Speaker, my two colleagues, the hon. member for Ottawa Centre (Mr. Poulin) and the hon. member for St. Catharines (Mr. Parent), have spoken at some length concerning the possible impact on the quality of statistics which might result from the implementation of Bill C-213. Hon. members may have the impression that Canadian practices with regard to the gathering of official statistics are somewhat behind the times and that we continue to hang on to archaic and unnecessary procedures that other, more enlightened countries have found it possible to discard.
The officials who operate Canada's national statistical system are always anxious to learn from their colleagues in other countries about new developments which will make it possible to maintain or improve the quality of their outputs, while at the same time reducing the burden on respondents. In this connection it may be useful for me to go over a review which Statistics Canada conducted in 1975 of the statistical legislation of other countries. The review concentrated on five countries, the United Kingdom, France, Sweden, the Federal Republic of Germany, and the United States. All of these countries have well developed, highly sophisticated, national statistical programs, and all have one or more pieces of legislation which regulate the collection, compilation, analysis and publication of statistical data by their respective statistical agencies. It is clear from this review that all of them rely, for the continuing viability of their operations, on some form and extent of mandatory reporting, although like ourselves they do not use this as a stick with which to beat respondents.
In the United Kingdom, for example, the legislation which governs the operations of the business statistics office contains a provision for undertaking legal action against non-respondents to official surveys of business establishments, with a maximum fine of $125 for a first offence and up to $500 for a second offence.
In France the legislation governing their Institut National de la Statistique et des Etudes Economiques also contains provisions for a penalty of up to $500 for a first offence for businesses which refuse to respond to official surveys. If a firm
February 22, 1977

is convicted of a second offence within a three-year period, the fine is increased to a minimum of SI,000 and a maximum fine of up to $5,000. In addition, special penalties can be assessed against large firms, that is, those with more than 100 workers. Upon conviction for a second offence within three years, they are liable to fines of from $10 to $50 per employee up to a total maximum fine of $10,000.
In Sweden also persistent non-respondents to official surveys of the National Bureau of Statistics are liable to prosecution at the request of the national bureau under king-in-council decree. If convicted, non-respondents are liable to a fine of up to 500 kroner, or approximately $125.
The West German situation is also similar. In that country there is legislation which provides for a maximum fine of up to $2,500 for non-response to official government statistical surveys.
The situation in the United States is slightly more complicated due to the fact that there exists in that country several departments or agencies which collect official statistics. However, the two most important are the U.S. Bureau of the Census and the Bureau of Labor Statistics. The legislation covering the operation of the U.S. Bureau of the Census provides for penalties for non-response to annual surveys as well as to certain monthly and quarterly surveys. Conviction under these provisions can result in fines of up to $500. The situation in the case of the Bureau of Labor Statistics is somewhat different. Many of its surveys are conducted on a voluntary basis. However, in such areas as surveys of occupational safety and health statistics programs, response is compulsory and there are provisions for fines of up to $500 for non-compliance.
Although I would like to continue my remarks on this worth-while bill, in view of the hour, Mr. Speaker, may I call it six o'clock?


Mr. Deputy Speaker:: It being six o'clock, and the hour appointed for private members' business having expired, I do now leave the chair until eight o'clock.
At six o'clock the House took recess.


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

Federal-Provincial Fiscal Arrangements


[Stage Direction]
The House resumed consideration of the motion of Mr. Macdonald (Rosedale) that Bill C-37, to provide for the making of certain fiscal payments and of established programs financing contributions to provinces, to provide for payments in respect of certain provincial taxes and fees, and to make consequential and related amendments, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Arthur Jacob (Jake) Epp: Mr. Speaker, just prior to my calling it five o'clock I indicated it was my view that it is important at this juncture in our history to look at the various regions of Canada and interpret how they see Confederation working. As a member from western Canada I see it as my task to present to the government how I see Confederation working in my part of the country, and hopefully we can get together on some problem solving which I feel would enhance Confederation in the future.
I also stated it is my view that over the last ten years Quebec has dominated Canadian public affairs to too high a degree, that in view of the fact that this has happened other areas of Canada, and specifically western Canada, have not received the attention in public debate and in policy making I feel they should have, and that this has added additional strains to Confederation.
I also stated that those of us who come from western Canada are not separatists, but looking at the various articles which are currently appearing in the daily media one would almost think that is what we have become. I have in my hand an article which appeared in the Saturday, February 19, Toronto Star. It also appeared today in the Ottawa Journal. It is written by Richard Gwyn, and it is entitled "The West Could Slide Out Of Confederation." While there are some observations of that writer which are accurate, I suggest that that is overstating the case rather dramatically.
Having said that we western Canadians are federalists, I believe that it is important to note that we entered Confederation of our own free will after the terms of Confederation had already been drawn up and were operative. They were operative in 1867, and all the western provinces joined Confederation after that date in a voluntary manner. However, throughout the past 110 years of Canadian history we have stressed one Canada, that we are part of that Canada, and that we want to remain in Canada.
While a few voices in western Canada today might be loudly demanding separatism, I suggest to hon. members on both

February 22, 1977
Federal-Provincial Fiscal Arrangements
sides of the Flouse that they are few in number and that the noise they create far exceeds their popular support.


Some hon. Members:: Hear, hear!


Arthur Jacob (Jake) Epp: Having stated that, I would be incorrect in saying that there is nothing seriously wrong with Confederation as western Canadians see it. There is a strong feeling of alienation felt by people who support all parties. There is a strong feeling that we are so far removed from the centres of decision-making power that we really count for very little.
Perhaps over the years we have developed an inferiority complex, but no matter what the cause the fact remains that this feeling of alienation is there. We are concerned that the problems of unemployment, investment, growth, and expansion are not getting the serious consideration which is needed because we keep concentrating on questions of Confederation. One would think that after 110 years of our history we would have grown mature enough to recognize that this union is here to stay and that we can develop it.
Although there is alienation in the west, we are still Canadians. We may criticize, say something is wrong with Confederation; we may not like the centralized decision-making power of the government, of any government, but that does not make us bigots. We have a deep love of our land and very much want to see our particular area of the world developing.
I believe the Economist puts it too strongly in its article when they talk of hatred in the west. Let me quote Mr. Gwyn's article.
Hatred is too glib, a shade too strong a word. Indifference, impatience, frustration, contempt, are better descriptions of the west's mood.
I believe he is right.
Not only do we feel alienated; we are frustrated. We believe nobody is listening to us, that the government thinks that we are few in numbers and consequently not worth listening to. Mr. Speaker, we are fed up with brokerage politics. We have seen one area of Canada pitted against another. If one may use a Biblical reference, I guess we are like the early apostles, like voices crying in the wilderness. No one wants to listen.
The west also recognizes that it lacks input into central decision-making, as is reflected in federal-provincial relations. I say that because the premiers of western Canada have raised this very same complaint, but little has been done to rectify it. We are not interested in tokenism. We want to be involved. Is this government genuinely interested in western views, or does it look on us only as people who live somewhere in the west and who keep repeating a long litany of complaints?
What has happened since the days of July, 1973? When the Liberals formed a minority government the Trudeau administration was deeply concerned about the erosion of its support in western Canada. What did it do? It called the Western Economic Opportunities Conference in July, 1973. Oh, it was a great media performance. A lot of work was put into that conference. Position papers were submitted, and we western

Canadians were in high hopes of seeing solutions to some of our problems emerge from that conference, of seeing the west become more greatly involved in central decision-making. Unfortunately little changed. In 1974 the government was returned to power with a majority, and all the promises made at the Western Economic Opportunities Conference went by the board.
Interestingly enough, the views expressed by the western premiers at the recently concluded federal-provincial conference were virtually the same as those expressed in Calgary in July, 1973.
The list of concerns is long, and 1 shall mention a few. The hon. member for Churchill (Mr. Smith) has repeatedly made representations for the upgrading and further use of the port of Churchill. The farmers of Saskatchewan, farmers of northwestern Manitoba, and members of the Hudson's Bay Route Association have asked that the port of Churchill be utilized to its fullest potential. But the government has not acted; we have seen little action in that regard. Western Canadians have longed complained about tariffs, those applying to farm products and those applying to manufactured goods. Hopefully the present round of negotiations in Geneva will correct some long-standing grievances.
1 will not go into the question of freight rates for it has been repeated ad nauseam; nevertheless, that problem still exists.
If I were parochial I would discuss at great length Air Canada's move from Winnipeg. Some people think that the move of certain Air Canada facilities from Winnipeg to Montreal eight years ago has been forgotten, that the move was never questioned. In the 1974 election campaign the Prime Minister (Mr. Trudeau) dropped into our area and, as a result, we got a hangar. You should see that hangar now, on the west side of the airport. Yes, it is being built.


Mr. Hamilton (Swift Current-Maple Creek):: What a hangar, Jake.


Arthur Jacob (Jake) Epp: Yes, it is quite a hangar. Ironically, that hangar is not on MOT land. I understand the department must negotiate with the Department of National Defence in order to have access to the hangar.


Frank Fletcher Hamilton: If they want to do repairs, it takes them 45 minutes to get from the air base to the hangar.


Arthur Jacob (Jake) Epp: 1 have mentioned some of our grievances, but we see little evidence of the government's willingness to tackle them.
Let me raise another matter of importance to our nation. We want to develop our resource industry, certainly; but also, we want to develop a mature and economically viable secondary industry. In this connection let me put on record the conclusions set out in the presentation of the Department of Industry, Trade and Commerce to the conference of July, 1973. It said:
February 22, 1977

(a)	Large quantities of Canadian natural resources are exported in relatively unprocessed forms, and recent trends, notably with respect to minerals, indicate the proportion exported in crude form is increasing.
We want the opposite to happen. Unfortunately we are exporting crude resources and, by so doing, exporting jobs from Canada, including western Canada.
I have fought two election campaigns. I spent much time talking to people in rural communities who wanted to make their communities viable. We witnessed the trend toward larger sized farms, for it was thought that only large farms could be viable economic units. My point is that we must process more of our agricultural and natural resources, and it must happen in western Canada. It is not happening now.
I continue quoting from the conclusions of the Department of Industry, Trade and Commerce:
(b)	A wide range of resource commodities provide potential opportunities for adding value, through processing prior to export.
It is not happening. I continue quoting:
(c)	If these opportunities for adding value could be realized, there would be significant direct benefits to the economy in terms of increased incomes and employment, and the resulting processed materials could provide a basis for forward integration into fully-manufactured products.
A department of the federal government recognizes the need for action, but what has happened?
While the government's actions have strained the bonds of Confederation, western Canadians have come to realize that they possess economic clout. We have always been concerned about our population being somewhat sparser than that of central Canada; nevertheless we have developed a new economic clout which has been embodied in the form of agricultural and natural resources. In other words, the world today needs commodities. There is a developing need for our commodities, not only outside Canada's borders but inside. In fact Gwyn argues it is almost a sense of revenge that westerners have, that finally they have some levers with which they can move the central government. It is my view that while we want to see those natural resources developed, it is incumbent that all Canadians share in those resources.
There is one other point I want to make. Many of us in Canada, especially in western Canada, are of a background other than either of Canada's two official languages. In the past ten years, for very good reasons, many of these people who sometimes are referred to as ethnic Canadians-I prefer to have no hyphenated Canadians-have been made to feel that they are not as important in Canadian life as they might have hoped they would be.
Multiculturalism has been used by this government as a whipping boy. There was a minister between 1972 and 1974. After once again receiving a majority, that portfolio was removed and it has now been placed under Labour. That community, whether it is based in Toronto or in the west, is not fooled by machinations of that type.
What these people had been hoping for, and I hope it takes place in our future, is that they will be judged, not by their
Federal-Provincial Fiscal Arrangements background, not by the accent with which they speak one or both of Canada's official languages, but by their contribution. That is what is important.
I know the Postmaster General (Mr. Blais) is trying to get a word in, but the fact is, and I say it to him directly, that just because he might disagree with me, that does not remove the alienation. It is there. It is time that Canadians looked at their total resources to see how they can best be used for the development of this country.
In conclusion, I want again to emphasize that we are federalists. We are proud to be Canadians. However, we are no longer willing to give in to economic blackmail. We are interested in sharing in the task of nation building. We are not asking for special status, but we demand equal status.


Marc Lalonde: Mr. Speaker, I am pleased to be able to enter the debate on this important, indeed historic, bill that has been tabled by my colleague, the Minister of Finance (Mr. Macdonald). In keeping with my own departmental concerns, I would like to direct my comments today to the new and innovative financial arrangements between the federal and provincial governments in the areas of hospital insurance, medical insurance, and the extended health care services.
The introduction of the established programs financing arrangements will culminate years of discussions between the federal and provincial governments about an appropriate financial arrangement to replace the current cost-sharing arrangements for medical care and for hospital insurance. For them and for us this new financial arrangement represents another important step in the maturation of our national health care system.
Probably the single most significant development in the health field in Canada over the last two decades has been the implementation of our universal health insurance scheme. The federal government's primary concern in this area was to ensure the development of uniform health insurance programs throughout the country. As a result, we offered to share the costs of these programs on the condition that provincial plans met the broad criteria of administration by public authorities, universality, comprehensiveness, and portability from one province to another.
As a consequence of the shared-cost programs legislated for hospital insurance in 1957 and for medical insurance in 1966, Canadians have been provided with high quality and universal health care insurance. Indeed these universal health insurance programs have become so deeply ingrained in the Canadian fabric that any retrograde step in the form of halting or even reducing these programs is absolutely unthinkable.
It is this strong commitment by Canadians and by all the provincial governments that encourages us to propose a major change in the financial and administrative arrangements between the federal and the provincial governments. Because the very existence of these programs is no longer questioned, the administrative presence of the federal government can be

February 22, 1977
Federal-Provincial Fiscal Arrangements reduced and the operation of the system can become even more effectively controlled by the provincial administrations.
The established programs financing arrangement is a major step toward increasing provincial flexibility in the administration of health care programs. Under the new arrangements the federal government will continue to pay a substantial proportion of the costs of medical care and hospital insurance. But, by providing a financial contribution that is not tied to the provincial program expenditures, several very important program and administrative objectives will be achieved.
First, provinces will be able to achieve greater efficiency in the use of their health care resources. No longer will provincial health priorities be influenced toward health care delivery forms that are covered by shared-cost programs. Whether or not a provincial dollar is spent on home care, acute care or physician's services will no longer influence the size of the federal contribution. Thus provinces will have the flexibility required to develop the most appropriate, but also cost-efficient, health care delivery system.
We have heard arguments, Mr. Speaker, from provincial ministers and from some hon. members opposite, that our terms are not flexible enough. These arguments usually come from the same people who want much higher levels of guarantees of revenues under the terms of our proposed agreements. Now of course, complete program flexibility together with very high levels of guarantees is an impossible request for any responsible federal government to meet. The result could be program anarchy together with very high costs-the worst of both worlds. Similarly we cannot keep a careful rein on expenditures while providing very high flexibility for to do so would be to encourage different provinces to pick and choose different pieces of a complete array of services. Once again the result would be no real guarantee for all Canadians of a reasonably uniform standard of services. We have, therefore, opted for a reasonable level of guarantees together with fully adequate, but by no means infinite flexibility in program design.
Second, the established programs financing arrangements will facilitate a streamlining of the federal-provincial administrative structures thereby eliminating administrative steps which are no longer essential. Examples would include federal auditing of provincial plans or protracted discussions about the shareability of specific provincial expenditures.
Third, and I view this as being of considerable importance, it will facilitate a gradual redirection of energies at the federal level toward other aspects of health care such as health standards, research, and manpower planning, as well as toward social services and the primary prevention of health problems.
[ Translation]
Within these general comments concerning the flexibility of the new agreements and the greater administrative discretionary powers of the provinces, I would like to give some explanation of the basic requirements of the hospital insurance and Medicare plans. Even if federal-provincial administrative mechanisms will no longer be as complex and if the federal contribution will no longer be based on the cost of provincial

programs, the financial share of the federal government will continue to be related to the implementation in provincial medicare programs of the following objectives: the globality of the guarantee concerning services, universal application to the whole population, transferability of benefits among provinces and service availability not restricted by excessive user fees, and finally, non-profit administration by a public agency.
These basic objectives are well established in the present system and all provincial governments understand them well. Keeping them will therefore not really impede the flexibility of the provincial programs and the new financial arrangements. To facilitate the introduction of the new financial arrangements in the case of hospital insurance and medicare, it is necessary to amend certain aspects of the Hospital Insurance and Diagnostic Services Act and the Medical Care Act. These amendments are contained in Bill C-37 now before us.
The changes required come within three categories. First, the financing formulas established under the Hospital Insurance and Diagnostic Services Act and the Medical Care Act will no longer apply after March 31, 1977. Then, we shall have to make minor changes to the type of information required from the provinces. Until now, the provisions concerning this point in the Hospital Insurance and Diagnostic Services Act and the Medical Care Act were based on the existence of cost-sharing formulas.
In the future, we will need more general information so that the federal government can supervise the application of the basic requirements of these programs, produce the statistics required at the international level, exchange comparable information between the provinces and proceed to the planning and assessment of the national system of health with the cooperation of the provinces. Finally, those changes will be introduced to facilitate amendments to the provincial programs. For example, the federal Minister of Health will not be required to agree officially with amendments concerning the registration of hospitals and authorized costs. However, we will always need the information that the provinces can give us on such matters. As concerns particularly the basic requirements of the health programs, the legislation concerning hospital insurance and medical care will remain unchanged. Next year we hope to have the cooperation of the provinces to establish a single legislation on health insurance which will cover both the hospital insurance and the medical care programs, and which will provide an integrated legislative structure determining the federal government's role as regards health care.
I would like as well to comment on the initiative being taken by the federal government to provide an additional contribution to the provinces to assist them in the provision of supplementary health care schemes. The per capita transfer for the extended health care services will assist provinces in the development and provision of new health care services that are appropriate given the health problems of their particular clientele and which are cost-efficient as compared with more
February 22, 1977

traditional methods of delivering health care. As my colleague, the Minister of Finance (Mr. Macdonald), told hon. members when he spoke concerning this legislation, we have informed the provincial governments of our intention to proceed with these measures in this House as rapidly as possible.
Over the past years many provinces have taken initiatives in areas such as home care and ambulatory care but these services have had to be financed to a large extent by provinces. Indeed, one of the major problems with the existing cost-sharing arrangements is that federal financing has been provided for the more costly forms of health care to the detriment of some innovative, and cost-efficient, delivery techniques. Under the new Financial arrangements, which move away from detailed cost-sharing formulae, the federal government will be contributing in a manner that provides provinces with more flexibility to work toward the most appropriate and cost-efficient set of health care programs.
Up to now the federal government has provided the provinces with considerable financial assistance for adult residential care under the Canada Assistance Plan cost-sharing arrangement. Another part of the proposal currently before the House is to bring adult residential care into a per capita, block-funding, arrangement. By this expedient all levels of adult residential care will be financed through a similar financial arrangement. This will ensure that distortions in provincial programming of institutional care due to the financial arrangements will be minimized. Again, the provinces will have the flexibility to provide their residents with the most appropriate level of care without being impaired by financial and administrative formulae. This bringing together of all types of adult residential care under a common financial arrangement is a good example of the steps that are being taken by this government to harmonize the relationship between various health and social services programs.
These new arrangements for hospital insurance, medical care and post-secondary education will provide provinces with greater financial assistance, through the transfer of tax room and the cash payment, than would be transferred with the present shared-cost arrangements. The entitlements under established programs financing are estimated, for 1977-78 alone, to exceed by about $750 million the entitlements that would be generated by the present shared-cost programs. I should note that the estimates for the shared-cost programs are based on the provincial estimates of their program costs.
In addition, the arrangement for the extended health care services also provides the provinces with some additional financial assistance. For 1977-78 more than $100 million in additional financing will be provided by the $20 per capita transfer than would be provided for these services through the Canada Assistance Plan.
The implementation of these new financial arrangements for the health care programs will result in a substantial federal financial contribution in a manner that provides provinces with the flexibility in program decisions necessary to achieve greater efficiency in the use of their health care resources. This will
Federal-Provincial Fiscal Arrangements be accompanied by a streamlining in the administrative structures within my own department.
Hon. members may perhaps recall that last November I announced that I would be moving to integrate the health and the welfare sides of my department under a single deputy minister. This move was prompted by the twin desires to achieve greater administrative efficiency within my department and to provide more efficient and effective health and social services to Canadians. Since it is virtually impossible to draw a meaningful line between social and health services, it is my conviction that we must move toward much closer co-ordination of the two general areas. Several provinces have already moved in this direction and Bill C-37 will help them to move further, as will the provision of a single locus of administrative responsibility within my department.

As I mentioned earlier, the federal government will now be in a position to further redirect its energies towards social services and primary prevention in the area of health. So I would like to conclude by indicating a few initiatives now under way or soon to be undertaken. The basic objectives of the government policy in the area of health and social welfare can be summed up in the two following propositions: first, we intend to provide the highest possible degree of physical and mental well-being and development for all members of our society, within available resources and, second, we intend to ensure as great distributive equity and justice as possible among individuals and groups considering the means available to reach that individual development and well-being. Those objectives prompted the federal government to show leadership in the area of health insurance in the 1950s and 1960s.
The health insurance system that came about as a result of those initiatives has no doubt greatly contributed to the achievement of the basic objectives of our health policy. Those very objectives are now prompting the federal government to lead the way in the area of social services and primary prevention, particularly with respect to physical and social environment and lifestyle. Those new challenges have been accepted by the federal government and concrete action is under way. The nature of these initial steps necessarily had to be limited. However, I am convinced that the success of those first initiatives is obvious if one thinks, for example, of our efforts to make the wearing of seat belts compulsory and reduce speed limits, as well as the following initiatives: our campaign entitled Dialogue on Drinking, for example; the development of an over-all program affecting the living habits of each and everyone and entitled Operation Lifestyle; more and more stringent and efficient food and drug regulations; and finally development as a high ranking priority of higher safety and health standards in the work environment.
I would also stress, Mr. Speaker, that I shall introduce shortly a piece of legislation for the funding of other social service programs provided by the provinces. Such a bill will strengthen the provinces' financial capacity to give Canadians social services, in order that they enjoy greater flexibility and receive a more generous federal contribution for special initia-
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February 22, 1977
Federal-Provincial Fiscal Arrangements tives. It must therefore be considered an essential supplement to the bill now before us.
In the health care area, our main concern over the years has been for the financial aspects of shared-cost programs. Simultaneously however, we have participated with the provinces in various projects such as the development of health standards, manpower studies, program assessments, program data analyses and the development of special expertise such as the extension of various techniques to health care.
The federal government will continue its efforts in those areas and we want to maintain close co-operation with the provinces and other health groups so as to implement and maintain priority projects along those lines. To conclude, Mr. Speaker, the new financial arrangements with respect to health insurance and the new health programs will provide the provinces with the increased flexibility and financial help needed to improve their health care systems. Those arrangements, in addition to the new initiatives by the Canadian government in the social services areas and primary health prevention, and to the continued participation and leadership by the government in other health areas, will assure Canadians of constant progress in the achievement of the basic goals of our health and welfare policy.


Mr. John C. Crosbie (St. John's West):: Mr. Speaker, I wish I could rise to congratulate the government on the legislation that is now before the House but I am afraid that is impossible, not that I would vote against it, because too many of the provinces of Canada would suffer damage if the House were to defeat these iniquitous conclusions which are now before us. What I would point out in my remarks tonight is just what happened on the way to these conclusions.
If we look at what happened within the last year or two of negotiations on fiscal arrangements, I believe we will see to a very great degree why the people of Canada and the provincial governments today feel there should be some different constitutional arrangements in Canada. They feel that way because of the rough way they have been treated in these negotiations by hon. gentlemen opposite.
I should like to entitle my remarks tonight "A Funny Thing Happened on the Way to the Forum", and to tell the House some of the funny things that happened on the way to the conclusions which are before the House tonight. This is the forum that the funny things happened on the way to; I do not know of any funny things that happened in the forum, but some funny things happened on the way to get here.
Why do the provinces feel aggrieved, and why are the people of Canada feeling aggrieved? Why is it that practically every article one reads these days refers to the fact that there is a need for more decentralization within Canadian constitutional arrangements? Why is there this demand now, which has become particularly prevalent within the last six months or a year? This demand has arisen, in my opinion, as a result of the roughshod way that hon. gentlemen opposite have run over all

the provinces on the way to reaching the conclusions that are now before this House in the form of this legislation.
The provinces of Canada, or at least seven of them, badly need the financial assistance that is offered in this legislation. If I use as an example the province I am most familiar with, the province of Newfoundland, there is no question that the province of Newfoundland needs the tax equalization and contributions to shared cost programs which are contained in this bill, and I would have to vote for the bill for that reason. Newfoundland is to receive a tremendous amount of revenue, and since it is so important to the general scene in Newfoundland I cannot very well vote against the bill.
I have some figures here, Mr. Speaker. For example, in 1975-76 of the total revenue of the province of Newfoundland the government of Canada contributed 52.4 per cent by way of tax equalization and shared cost programs on both current and capital accounts. For 1976-77 the amount estimated is 51.7 per cent, or some $461 million of revenue which the government of Canada will contribute to the province of Newfoundland. This does not mean to say that because the government of Newfoundland receives a large share of its revenue from the government of Canada that we are just going to lie down and take whatever is handed to us without expressing any independent views on what happened to reach this conclusion and what should have happened.
Provinces like Newfoundland badly need financial help and hon. gentlemen opposite, knowing that, feel that they can throw their weight around without fear or trepidation for that reason. I want to show this House some of the ways they have done that, Mr. Speaker. It is my view that the process by which this result was reached was not a example of co-operative federalism. We used to hear a lot about that from hon. gentlemen opposite, particularly when the Prime Minister (Mr. Trudeau) first took office. We were going to have co-operative federalism. What we have in this bill is not co-operative federalism but the result of strong arm federalism. It is the result of forced put federalism; it is the result of bully boy federalism, not co-operative federalism. It is arm twisting federalism that we see in the legislation that is now before the House.
We also used to hear a lot about participatory democracy. This bill is not an example of participatory democracy but of closed conference autocracy. This is what is before us tonight. The great participatory democrat of 1968 has become the closed conference autocrat of 1977-make no mistake about that. If the Minister of Finance (Mr. Macdonald), with his brass knuckles, is not sufficient to quell the ten provinces, then out comes the Prime Minister himself, the expert with the stilleto, the expert in fiscal Kung-Fu, to put the final kibosh on the provinces.
There are five things wrong with the arrangement now before the House. It is forcing the provinces to take all the risks in regard to the increasing cost of hospital and medical care as well as in post-secondary education, but particularly in regard to the first two, hospital insurance and medicare. The federal government is putting the onus of meeting increased
February 22, 1977

costs on the provinces, many of which did not initiate these programs. These programs were initiated by the great white god in Ottawa who initiated hospital insurance and medicare and made it impossible for the provinces not to go into those programs. Now the federal government no longer wishes to share the increasing costs in those fields and is putting the risk on the provinces. There are five or six provinces that are in no financial position to take that burden. They did not initiate these programs, but now the risks are on them. Those provinces did not impose inflation.
If we want to know why hospital costs have gone up in the last ten years we should look at this government which overspent us into inflation. It said we were not going to have inflation. It said inflation was imported-it came from Afghanistan, from Pakistan-it came from everywhere but Ottawa. This is the government that has all the financial powers, the fiscal powers, the Bank of Canada, and which controls the currency and the printing presses. But it cannot control inflation, Mr. Speaker.
The provinces were faced with inflation which was not controlled by this government and which was running at 10 per cent or 12 per cent. Hospital costs rose and other costs rose, and the federal government blamed the provinces for the increasing cost of hospitals and so on and said they had to take the risk of it.
What happens if the federal government unleashes another burst of inflation across Canada and these provinces are left with the increasing cost of hospital care and medicare? All this will be put on the provinces that can least afford it. That is one of the weaknesses of this legislation. The federal government would not make a commitment to review the situation in some regular fashion by 1980; it insisted that the changes come by 1977. It is not committed to any review of what happens to these programs by 1980. The Minister of Finance laid down the fiscal tablets like Moses and the provinces either accept them or are buried in the bullrushes. No one should get the idea that the proposals embodied in this legislation were accepted by the provinces. The provinces have not accepted these arrangements willingly-only after a long period of bullyragging and brute pressure by the Minister of Finance and his colleagues. We do not hear any loud hosannas coming from any province as a result of this arrangement, so it has not been accepted willingly.
The fourth weakness is that this is going to leave the weaker provinces squeezed, in a position of financial distress, with inferior services that will remain inferior until some other government is elected that will be more careful about the realities of Canada.
The fifth weakness of these arrangements is the damage that has been done to federal-provincial relations. That cannot be underestimated. When all the statesmen in Ottawa and elsewhere in Canada are considering the difficulties with Quebec and all the rest of it, they might well consider the damage done to the whole structure of Canada in the last
Federal-Provincial Fiscal Arrangements
several years in reaching these arrangements. It is my view that the constitutional crisis in Canada is very likely to be solved much more easily when there is a change of government-


Some hon. Members:: Hear, hear!


John Carnell Crosbie: -and if the practitioners of strong arm federalism are put out to grass where they belong.
This is a complicated piece of legislation, and these are complicated arrangements. The ordinary person in Canada cannot be expected to understand them. Even we in this House, wise as we are, have difficulty understanding them, so the ordinary person in Canada will not know what this is all about. But over a period of time they can get a general impression. We are dealing with a complicated issue.
What are the provinces complaining about? Some of the changes were made by the federal government without consultation-without "by your leave". They were told to do it just because the federal government has the fiscal muscle and no one can stand against them. There are at least a dozen instances of this in the last few years. A revenue guarantee was given by this government in 1972 that, as a result of a new income tax act and all the changes in personal income tax and corporate taxes, the provinces would not lose any revenue. The federal government promised to guarantee them against loss of revenue and entered into an agreement for five years in order to get that pledge. The federal government developed its own formula, however, for calculating what the revenue losses would be.
The federal government with its all fiscal experts-hundreds and thousands-ten thousands of them, I suppose-rank upon rank of them, came up with a formula to assess the loss of any province by virtue of the changes in income tax and corporate tax. But these losses far exceeded what the federal mandarins expected. It cost a lot more money than they expected. It cost a lot more money than they anticipated. Without so much as asking the provinces if they agreed, in 1975 the Minister of Finance announced that he was going to change the revenue guarantee-that the formula being used to calculate what the provinces got was going to be changed retroactively for 197475. His own formula, the federal formula, was going to be changed without their consent, and in 1977 the whole guarantee program would be terminated and there would be no compensation for that either. It was just an announcement, not even a proposal. The hon. gentleman just made the pronouncement that this was going to happen.
Naturally the ten provincial governments were irritated to be told that something settled several years earlier was to be changed retroactively, in addition to causing losses of hundreds of millions of dollars. This is one example of what went on in reaching this agreement.
As a result of that decision the province of Newfoundland is to lose at least $8 million per year under the revenue guarantee. There was to be no compensation, although the previous minister of finance-a more warmhearted gentleman who could not stand the company opposite because they were too
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February 22, 1977
Federal-Provincial Fiscal Arrangements hardhearted, and who is now practising law in Toronto in preparation for his next move-gave an assurance that there would be something to replace the revenue guarantee after five years. That was changed unilaterally by the federal government, the people who set up the formula-heavy handed and heavy fisted-hamhanded and hamfisted-uncaring.
They entered into an agreement with the ten provinces a few years earlier. And what else did they do, Mr. Speaker? They decided to put ceilings on some of these programs because of rising costs-costs caused by the inflation they had induced or failed to prevent. But they were not going to bear the brunt of that and placed it on the provinces who could ill afford to bear the brunt.
One of the changes they made was in the health insurance and medicare field. In the June, 1975, budget they decided to put a per capita growth rate ceiling on their contributions to medicare. It was not agreed upon by the provinces but just decided by the federal government. The medicare program that hon. gentlemen opposite started in 1967 and made it impossible for the provinces to stay out of was now costing too much-more than they anticipated because of their lack of care and failure to halt inflation, so they put on arbitrary per capita growth rates of 14.5 per cent for 1976-77, 12 per cent for 1977-78, and 10 per cent for 1978-79 and subsequent years. There was no consultation. The provinces were told the federal government will only share increasing costs if they do not exceed those percentages. That naturally has a tendency to induce bad feelings between the provinces and the federal government.
The miracle is that we still have a country, with the way the provinces are being treated. This is supposed to be a federal state. We are supposed to have one government at the centre and ten provincial governments supreme in their own sphere, but because of the fiscal power, because the federal government controls the tax system directly and indirectly, and because it controls the monetary system, it has the whip hand. This is no longer a federal system but a Liberal unitary system.
A unilateral change was made in medicare. The Minister of National Health and Welfare (Mr. Lalonde) wanted to change the arrangements in health insurance because health insurance costs were rising too quickly to suit him. He does not deal with hospitals; he does not enter into collective negotiations and collective bargaining with CUPE and other unions that represent hospitals. He is not dealing with situations where hospital workers have been underpaid since the beginning of history, but in the last four or five years have willingly organized collectively and were exercising some muscle. They were determined to see their wages increased so they could get a living wage. The minister did not have to deal with that. He certainly had no sympathy for them because he decided he had to put on controls, and what was going to be spent on hospitals would be limited.
He came forward with proposals that the federal government would set a limit. He said the government would give the workers the same percentage increase as the increase in the gross national product each year. If their costs increased more than the percentage of the gross national product, they would still only get that percentage. That was the great brainstorm which he presented to the provinces, but the provinces would not accept it.
The proposal was made in 1972 and was rejected in September of 1974. Then the minister gave notice that in five years' time the government would terminate the whole hospital health insurance program. That is the government's idea of co-operative federalism. The new co-operative federalism is "If you do not do what I say, we will terminate the program and you will not get one cent for your hospitals."
1 am surprised backbenchers opposite support such a hard hearted, arbitrary, dictatorial set of cabinet ministers.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


The Acting Speaker (Mr. Ethier):: Order, please. The hon. member for St. John's West (Mr. Crosbie) has the floor.


John Carnell Crosbie: Mr. Speaker, let us look at another part of the established program financing which was established so that the ordinary people do not realize they are having their throats cut in health insurance, medicare, and education. They call it established program financing, EPF.
Let us take a look at post-secondary education. What did hon. gentlemen opposite do about this? They had instituted a system of supporting post-secondary education a number of years earlier. I will not go into the details of how they did it, whether it was per capita or 50 per cent of the costs in post-secondary education from trade schools to universities. But they became annoyed when these costs continued to rise. They were annoyed that the cost of operating trade schools, technical schools, and universities was rising. Having looked in the mirror and recognized the cause as being themselves, at least in part, due to the inflation which they permitted, or due to the fact that this was inevitable, they decided that the burden they were sharing for post-secondary education should no longer be shared on a 50-50 basis. They decided to put a 15 per cent ceiling on aggregate federal payments in any one year, a ceiling on the increase in federal payments. That was the decision they imposed several years ago.
The result of that in one province, Newfoundland, with which I am familiar, and that is why I hark back to it-I prefer to talk about something I know about-but this is true even more in other provinces, was that in 1975-76 Newfoundland received $1.3 million less from the federal government for post-secondary education than it would have received had the 15 per cent ceiling not been imposed unilaterally. All this was done unilaterally, not by way of negotiation or agreement. It was done by the hon. gentlemen opposite, the hon. King Kongs flexing their fiscal muscles and saying, "This is it", with not so

February 22, 1977

much as "by your leave". It is any wonder that Canada is being disrupted and divided and that certain provinces feel they should quit? It is because of that kind of treatment.


Some hon. Members:: Oh, oh!


John Carnell Crosbie: I am dead serious, Mr. Speaker. I have witnessed this for five years, and I am as serious as can be that in large part the reason for the dissatisfaction in federal-provincial relations is the arbitrary and arrogant attitude and actions of the hon. gentlemen opposite. I should not be warning them and telling them this. They might change in the next few months.


Some hon. Members:: Oh, oh!


An hon. Member:: Don't you believe it.


John Carnell Crosbie: Imminent elections cause the Liberals to do wonders. Anything is likely in the next few months. Even the Minister of Finance might become most conciliatory and might throw out a few million dollar to the provinces in the next few months. Perhaps I should not be mentioning these things at all.
Let us speak about something that is still more dastardly. Hon. gentlemen opposite should listen to this because it is another example in federal-provincial relations of the co-operative federalism as practised by the hon. gentlemen opposite, the hon. King Kongs. In December of 1975 the federal finance mandarins made an estimate of what they would have to pay for post-secondary education in the next fiscal year. The federal government entered into programs with the provinces for a few years and came up with an estimate. In the financial year 1976-77 they were going to spend $538 million, they would transfer that to the provinces under post-secondary education. They told the provinces this and the provinces accepted the federal figures. But lo and behold, in May of 1976 the federal financial wizards, the experts, hundreds of them, discovered that it would not be $538 million in 1976-77 under that program but rather $649 million. They made a mistake, they underestimated the cost.
It might have been the fault of the Liberals because of the Liberal induced inflation. They were going to have to spend $111 million more than they had expected. I am sure you will think that they took that on the chin, because of course they had to meet their commitments. They made a mistake in their estimates, but since the program had been established for years you might think they would accept that. Not on your life! They did not accept it. They told the provinces the country was under fiscal restraint. I say they should have been under penal restraint to do what they did, Mr. Speaker.


Some hon. Members:: Hear, hear!


Ramon John Hnatyshyn: Right in the solar plexus.


John Carnell Crosbie: They said to the provinces, "We underestimated by $111 million. We know we should pay you that money, but we are under fiscal restraint and we cannot pay it
Federal- Provincial Fiscal Arrangements to you until next year. You will not get what you are entitled to this year because we do not want to be embarrassed by going back to the House of Commons and having to admit there is another $111 million in supplementary estimates". So those shylocks, no-lucks, went to the ten provinces and told them they had to wait until next year for the $111 million. How is that for co-operative federalism? How is that for the great Liberal principle of participatory democracy? Bushwhackers! There will be no democracy in this country until we get those scoundrels out.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: I just want to make one reference to Newfoundland in this connection to show the enormity of the crime. Because the government is going back on its commitments in 1976-1977, Newfoundland receives $2 million less for post-secondary education than it should. Presumably it will get the $2 million next year. It has been postponed.
I mentioned in another debate in this House several weeks ago-and the Minister of Finance took it very lightly, and he should not have-the fact that the federal government in another fantastic example of co-operative federalism-that is, you co-operate or you get nothing at all-unilaterally indexed the personal income tax in 1974. I believe it was the former minister of finance, Mr. Turner, who brought down that budget which unilaterally indexed the personal income tax. The government collects the provincial income tax for nine provinces, and they have to accept uniform conditions. The federal government is doing this because that is best for Canada. It causes less confusion, it is more efficient, it saves money, and it obviates 11 governments each having to collect its own.
The hon. gentleman entered into an agreement with nine provinces to collect their income tax, but unilaterally, without consultation, without notice, and without as much as "by your leave" or a please or a thank you, indexed the personal income tax, which caused all nine provinces to lose millions of dollars over the last three years. The federal government did not even agree to compensate them for this loss. As a result of that unilateral indexing-and I could care less if the federal government indexes its own income tax; that is its own income tax; let it do what it likes with its own-instead of just indexing its own, it indexed the income tax for nine provinces. Perhaps it had to do it for technical reasons, but if it had to do it for technical reasons it should have made up the revenue lost to the provinces. However, the government opposite did not do that. It just imposed indexing itself and caused the loss of hundreds of millions of dollars to those provinces.
In the case of Newfoundland the loss this financial year is $30 million. That is $18 million in income tax, and the rest in the negative effect that had on tax equalization. The Minister of Finance took $30 million out of the coffers of the province of Newfoundland in this fiscal year by that one change made without the consent of the province and without its consultation. He refused to reimburse the province for that, and every

February 22, 1977
Federal-Provincial Fiscal Arrangements time it is brought up he just smiles to himself as though it were the work of a genius. The hon. gentleman is going to discover that that is not something which is taken lightly. It is another reason federal-provincial relations are in the state they are. I am sorry. The figure for Newfoundland for 1976-77 in direct revenue loss is $14.9 million, and the estimate of negative tax equalization brings it up to $30 million. Of course, in the other larger provinces the figure is much higher.
All these funny things happened "On the Way to the Forum", but these were not very funny for the provinces which participated. That is why there is a strain in federal-provincial relations. That is why there is exacerbation, if that is the word to use. That is why feelings are not good. That is why people are suggesting we need to take a look at the BNA Act and the distribution of powers.
A lot of the pressure for that kind of constitutional review will disappear when the hon. member for Rocky Mountain (Mr. Clark) forms his government this year, next year, or whenever the next election is called.


Some hon. Members:: Hear, hear!


An hon. Member:: It's Bow River.


John Carnell Crosbie: He will be the member for somewhere; never mind about that. You are just lucky he doesn't run in your district.


Mr. MacFarlane:: 1 hope it will be outside the 200-mile limit.


John Carnell Crosbie: What is needed is not so much a constitutional change in Canada as a change in personnel in the government. We need someone who will be co-operative, someone who will negotiate, someone who will consult, someone who does not think he has all the answers, and someone who does not have the Liberal habit of thinking that he and only he has the answers, and that he is God's gift to Canada. When we get a change in the seats opposite this constitutional crisis will be vastly diminished.
In this House several weeks ago the Minister of Finance said that there was $1.25 billion more in the pockets of people because of indexing. I do not know how much of that applies just to federal tax and how much to provincial tax. However, I say that the hon. gentleman has a duty to put back in people's pockets what the government of Canada can afford, not what the provinces of Canada cannot afford.
I come from a province which cannot afford to rub two nickels together at the present time. It cannot borrow any more than it is borrowing. It cannot impose any more taxes. It already has the highest tax rates in Canada. It has the highest tax in the five main tax fields-sales tax, personal income tax, corporation tax, liquor tax and gasoline tax. They are the highest in Canada. The people in Newfoundland have the lowest per capita income. They have less ability to pay these high taxes. The government of Newfoundland cannot turn down what the government of Canada offers in the final analysis, but we do not have to take it quietly. If we think we
[Mr. Crosbie.)
are being treated unfairly we can protest, and we are protesting, and we are going to protest the dismal estimates which were tabled in this House a few days ago.
The estimates tabled in this House are an abomination. Of the $45 billion in estimates which were tabled in this House last week there was practically nothing for Newfoundland to fight the unemployment problem there. In the estimates of the Department of Public Works an amount of $300 million is for single purpose and general purpose buildings across Canada, but look at what is to be spent in Newfoundland: $276,000 in Fortune and Burin-Burgeo, and $700,000 for planning a tax data centre in St. John's. That is $1 million out of $300 million, one three-hundredth out of the department of patronage, the Department of Public Works.


An hon. Member:: Disgraceful!


John Carnell Crosbie: Only one three-hundredth is to be spent in Newfoundland, the province with the highest unemployment and with a construction industry which is having the greatest difficulty. What is the department spending in Ottawa-Hull, in this rich part of Canada? It is spending $63 million out of the $300 million from Public Works. That amount is to be spent in this fat-cat area of Ottawa-Hull for more government buildings.


Mrs. Holt:: Do your arithmetic, and you will know that that is not right.


Arthur Jacob (Jake) Epp: You mean it's more?


John Carnell Crosbie: I am not including Campeau. Campeau is in there under lease-backs. I am including direct government expenditures by the Department of Public Works to build buildings. What is the unemployment rate in Ottawa-Hull? It is very small. What is the unemployment in Newfoundland? It is at least 20 per cent to 25 per cent.
I went through the estimates looking at the items of $250,000 and more which were going to be spent. This was supposed to be shown in the estimates. I could not find $30 million spent in Newfoundland on those kinds of items. I am not talking about DREE now; I am talking about direct expenditures like transport, public works and fisheries. Only $750,000 is to be spent for small crafts and harbours in the whole of Newfoundland and Labrador, in all their 160,000 square miles. Over $2 million is to be spent in Nova Scotia, over $2 million in New Brunswick, and over $4.5 million in Quebec. Is that co-operative federalism? Like-I have to keep my language parliamentary. This is a diversion.
The people who brought these estimates down in this House should be ashamed of themselves. They are going to leave the people of Newfoundland to wallow in their unemployment problem. We have the guts to stand on our own two feet and not give in to them with regard to the off-shore minerals off Nova Scotia, Prince Edward Island and New Brunswick. We do not fall over and play dead. I will be speaking about that tomorrow, so I will not waste my time on it tonight. The pipsqueaks are putting the squeeze on Newfoundland because
February 22, 1977

we will not fall over and play dead; not on your life, Mr. Speaker. There is one of them now. I am going to move that that hon. gentleman's salary be reduced to two cents, and that is twice what I think he is worth.
If I may get back to federal-provincial relations-I am not in good form tonight, having risen at six o'clock this morning to catch a flight for Ottawa-I shall return to my main theme. I shall deal with my other theme tomorrow afternoon, hopefully. For the present I want to tell the House of other examples of bullying tactics, of dragooning, of Upper Canadian bullyboy behaviour.


Mr. Abbott:: Hear, hear!


John Carnell Crosbie: The hon. member for Mississauga (Mr. Abbott) had better watch out. If he ever comes down to Newfoundland he will find out what consumers can be like.


Mr. McKenzie:: He'll be consumed.


John Carnell Crosbie: The federal government agreed with the provinces on a program called revenue stabilization, that is, the federal government guaranteed that a province's total net revenue would not be less than its net revenue in the immediately preceding two years if the rates and structures of its taxes were to remain unchanged during those two years. That was the revenue guarantee.
That guarantee was most helpful for the financially less well endowed provinces, because they could go to the bond markets more easily. When you went down to the States and mentioned a revenue guarantee, it sounded good. People down there knew that the federal government's revenue guarantee meant that a province's revenues would not slip back, that is to say, if they did slip back from the level of the previous year, the federal government would make up the difference. The federal government never had to pay one cent under that principle. It never cost it one cent, one sou, one copper. It cost the government nothing to agree on that principle with the provinces; but it helped provinces like Newfoundland when they became involved in the financial markets. The guarantee provided Fiscal stability.
What did the federal government do with our revenue stabilization program? While the negotiations were going on to establish the principles embodied in this bill, the federal government came to the provinces and said, "We want to do away with revenue stabilization. We no longer want to implement that policy." In other words, it was another twist of the arm. The Minister of Finance had the poor old provinces by the arm, and he gave it another twist, as much as to say that if they did not behave, if they did not accept what he was offering, they were going to be hurt even more. The federal government said that revenue stabilization was to go by the board, although the program was not costing it one cent.
Some members of cabinet might realize the dirty struggle which was going on, and I hope they are listening.
Federal-Provincial Fiscal Arrangements


Steve Eugene Paproski: Listen, Gillespie, and you may learn something.


John Carnell Crosbie: I hope they are either listening or that they will read Hansard. What the government did was another example of its attitude to federal-provincial relations. Given all this, some of you may wonder why the ten provinces were able to get together and make a joint proposal last December 7. They did it because they wanted to save themselves. For the first time in federal-provincial relations, the ten provinces agreed together, on all of these-


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


The Acting Speaker (Mr. Ethier):: The Chair recognizes the hon. member for Shefford (Mr. Rondeau).


Some hon. Members:: Oh, oh!


The Acting Speaker (Mr. Ethier):: Does the hon. member for St. John's West (Mr. Crosbie) have unanimous consent to continue?


Some hon. Members:: Agreed.


Some hon. Members:: No.


The Acting Speaker (Mr. Ethier):: The hon. member for St. John's West (Mr. Crosbie) may continue. Order, please. I see the hon. member for Timmins (Mr. Roy) rising on a point of order.


Mr. Roy (Timmins):: Mr. Speaker, I rise on a point of order. I said no.


Steve Eugene Paproski: Mr. Speaker, I rise on the same point of order. The hon. member cannot rise on that point of order after Your Honour has recognized the hon. member for St. John's West. (Mr. Crosbie).


The Acting Speaker (Mr. Ethier):: That is a valid point of order. I had recognized the hon. member for St. John's West.


John Carnell Crosbie: Mr. Speaker, I will only take a minute or two.


Mr. Stollery:: Mr. Speaker, I also rise on a point of order. I also said no, and I am sure I said no before Your Honour recognized the hon. member for St. John's West.


The Acting Speaker (Mr. Ethier):: Order, please. It is possible that I did not hear. I shall ask again. Is there unanimous consent for the hon. member to continue?


Some hon. Members:: No.


The Acting Speaker (Mr. Ethier):: I could not hear the sense of the House; therefore I shall ask again. Is there unanimous

February 22, 1977
Federal-Provincial Fiscal Arrangements consent for the hon. member for St. John's West to continue his speech?


Some hon. Members:: Agreed.


Some hon. Members:: No.


The Acting Speaker (Mr. Ethier):: There is not unanimity. The Chair recognizes the hon. member for Shefford.


Mr. Gilbert Rondeau (Shefford):: Mr. Speaker, it is unfortunately funny to note that the wranglings in the House are similar to those now experienced in the Canadian confederation. This Bill C-37 dealing more especially with the federal-provincial relations is an extremely important measure and as timely in 1977 as it was in 1976.
The coming into power of the Parti Quebecois in Quebec on November 15 last was necessary to give an entirely new significance to Canada's federal-provincial relations. In my opinion, this political development in Quebec should be approached by the federal government in a realistic and serene mood, not with a tendency to say to Quebec: We will prove to you Quebecers that federalists are right. Such an attitude would only worsen the federal-provincial relations, because it should not be forgotten that all provinces feel that they are assailed when one of them is threatened by ultimatums, reprisals, official or unofficial sanctions.
The real problems which have led Quebec to its present condition-and this goes for the Canadian confederation- were not solved or settled at the right moment and now that we are before a fait accompli, long-term or effective solutions which would be beneficial to the provinces and to Canadian unity are rejected. A mature individual does not depend on ultimatums to take decisions.
Problems left in abeyance far too long without any solution created a state of fact within the Canadian confederation and when one wants to settle them, the good faith requisite for a frank dialogue often does not exist any longer unfortunately. A great many people have nothing to lose in fact. Why? Because they have lost everything and that is the reasoning one hears, wrongly or rightly, around Quebec everyday: Through what miracle would it be possible for the Canadian provinces to operate better tomorrow than in the last 110 years?
The present confederation seems to have been an impediment to the provinces' emancipation, if one considers the existing mentality in the Canadian provinces in 1977, in Quebec as well as outside Quebec. This impediment has been caused by overly great centralization and by the central government monopolizing provincial powers, ordering the provinces instead of being of service to them. This is the real cause of the conditions as we know them today. The provinces are less and less the blind servants of the federal government, and that is good, for it will prevent, I hope, excessive centralization by the federal government, which would prevent the provinces from becoming weak members in the family which is our
[The Acting Speaker (Mr. Ethier).]
nation. Mr. Speaker, let us imagine a child who would have grown in the same clothes at 12 and at 20. It is easy to imagine that at 20, he would feel stifled by the clothes he wore at 12.
The provinces have gone a long way, but during the last 110 years the Canadian confederation has gone in the opposite direction, strangling the provinces, which are increasingly capable of taking their responsibilities and ever less willing to depend on a centralizing government which they created to serve and not to strangle or provoke them by removing from them-and this has been said by many members in this House-by taking away from the provinces rights that belonged to them and which it now administers in their place.
Mr. Speaker, why should a county council do on behalf of a municipality what this municipality is perfectly capable of doing itself? Why should a provincial government do on behalf of a county council what this county council can do better than any other public organization? Why should the federal government do on behalf of a province what the provincial authorities can do more easily than the federal government? Where does this desire to centralize everything come from, Mr. Speaker? For the closer the authority is to the people, the better the chance people have to be as they have always been. Decisions made far from the people are always detrimental to the people. The farther the authority is, the better the chance financial institutions have of exploiting the people through centralization. That is why the financial institutions do not like to see decision making processes too close to the people. The farther away the decision making, the better served the financial institutions.
Mr. Speaker, the first thing which should come under the exclusive control of every province is its own credit. Each Canadian province should be provided with the services of a branch of the Bank of Canada. This branch should be fully and entirely responsible for the credit in the province, and the decisions as to the use and control of the credit of the province should come under the exclusive control of each province.
Mr. Speaker, Hydro Ontario is responsible for the distribution of electric power throughout Ontario, just like B.C. Hydro in British Columbia and Hydro-Quebec in the province of Quebec. Similarly a branch of the Bank of Canada would be responsible for financial credit in each of the provinces. So the federal government could no longer jeopardize the financial credit of the provinces by endlessly borrowing on their financial credit and guaranteeing loans for its own financing with the wealth of a province.
Mr. Speaker, this brings me back to the British North America Act which gave responsibilities to the provinces while centralizing the financial resources in the hands of the federal government. What is at the root of the quarrelling we have known since the beginning of confederation, the fact that while the provinces have clearly defined obligations and duties, the financial levers are in the hands of the federal government? This is why the last 35 years or so have been witness to perennial disputes over federal-provincial conferences, over taxation powers, over financial powers which the provinces do not have but which are held by the federal government and
February 22, 1977

which in turn mean further obligations for the provincial governments.
This is why, Mr. Speaker, as long as the federal government will not give the provinces the financial power enabling them to meet their provincial obligations, the Canadian confederation will unfortunately be in trouble and will continue to be threatened, not only by Quebec, but also by the other provinces. Why? Because the provinces were given responsibilities and the federal government was given the financial powers to meet those responsibilities.
Why this perpetual conflict in our federal-provincial relations, and why does the federal government refuse to tackle the financial problems to allow the provinces to achieve what they want and what they can do in their own sphere and within their own territory?
Mr. Speaker, this is why, like the former prime minister of Canada said, it is useless and pointless to talk about democracy in this Chamber as long as we have not placed financial powers in the hands of those who have provincial obligations towards the population. This is why, Mr. Speaker, we would like the government to'realize before it is too late that it is up to the federal government to take action to save Canadian unity and Canadian confederation.
You cannot blame children who want to leave the family home when they have reached an adult age if they are given only promises and told: Come and argue constantly at federal-provincial conferences, and you will still go back with promises because the federal government has not wanted, at least until now, to give the provinces the financial powers that they had before, but that the federal government took over because of an international event in 1939, at the start of the Second World War.
Mr. Speaker, instead of wanting to control the provinces, the federal government must therefore become somewhat more flexible, more understanding, and stop issuing secret directives to the world of finance so as to strangle a government which may have socialistic tendencies, 1 admit it, but which has still been chosen by the majority of Quebec voters. Let us therefore give this government the opportunity to pass good legislation if it has any. Let us give this government the opportunity to become bankrupt if the only thing it can offer the population of Quebec is economic bankruptcy. Mr. Speaker, I hope that this government can take its responsibilities and that it can request not the separation of Quebec from the Canadian confederation, but the financial powers needed to enable Quebec to fill its own aspirations.


Mr. Bob Wenman (Fraser Valley West):: Mr. Speaker, I am a Canadian. I believe in Canada. I believe in one strong united nation. I believe in a federation of regions united in mutual respect and common interest, in both the richness of regional diversity and the unity of a creative federalism that, in spite of many gusts, has burned so brightly on since 1867.
While it might well be that Canadians are drawn toward regionalism because they are disenchanted with a repressive
Federal-Provincial Fiscal Arrangements central government, the striving for an expression of identity from a regional perspective deserves close examination as to its potential to give expression to a new type of regional federalism. This new balanced federalism need not be a decentralization or a weakening of either federal or provincial responsibilities. Canadians have nothing to fear from strong regions as long as there is strong national government as well.
What we clearly need to ensure is a rational redistribution of responsibilities between the federal and provincial governments, a rational redistribution that involves clarity and the elimination of overlapping jurisdiction and duplication. This would mean that both the provinces and the federal government must be willing to forgo some programs, recognizing that certain services are delivered better by other levels of government.
The country has been committed to universality in social programming, which suggested that we should treat all regions as though they were the same although we knew they were not. Why, for example, apply a massive employment program in a region which has no real unemployment problem, but rather a weakness in its transportation links? Why not develop programs in response to regional needs rather than on the basis of universality for the sake of universality? We are a diverse country and we need institutions which reflect and accommodate that diversity.
Canada is in fact a federation of diverse regions. Why not recognize this situation and build from it? Why not recognize regional aspirations, maximize them, and allow them to replace the small but powerful vested interest groups which express their demands only too effectively on an old, tired structure which capitulates because of the impotency of a castrated parliament, stripped of its authority, dignity, and ability to produce for, and in the interest of, the majority of Canadians?
The clash of opposing regional forces is the seed from which Canadian identity must and will grow. Directed positively, in a spirit of co-operative federalism, it could be the new dynamism to drive a renewed confederation. Let us recognize not just two regions of Canada but rather the many diverse regions of our country, acknowledging each for the validity of its own unique cultural, social, political and economic aspirations. Let us recognize that Canada is great because of its freedom from uniformity, because of its capacity to tolerate, accept, and appreciate the great freedom of choice inherent in that diversity. Let us not be limited by our diversity; let us be elevated by it. Let us feel that our potential, is broadened and enhanced by it instead of retreating in fear from the reality, from the expressed desire for this new type of regional balanced federalism.
The present government has waited too long before recognizing the regional aspirations of Canadians. The bill before us is but a token attempt at recognition of those aspirations. The government and its leader are attempting to play the role of the saviours of Confederation. Mr. Speaker, this Prime Minis-

February 22, 1977
Federal-Provincial Fiscal Arrangements
ter (Mr. Trudeau) and his government are not the saviours of Confederation, but rather the saboteurs of Confederation.


An hon. Member:: Shame!


Robert Lloyd Wenman: Their arrogant confrontary tactics and abuse of power have led to a centralization of government never contemplated in the partner concept envisaged by the creators of the union of this nation.
Four thousand people responded to a questionnaire in my constituency and 80 per cent of them said that talk of separatism in several regions of Canada was really not a call for separatism as such but rather a larger concern that the government of Canada and its bureaucracy in Ottawa are too big, too much out of control, and no longer responsive to the wishes of the Canadian people. Eighty per cent felt that the real concern of Canadians is not separatism at all but rather a concern for better, smaller yet strong government. This strong western sentiment was exactly the sentiment which saw the government change in Quebec and will see a change in the national government of Canada.
I am confident in my Canadianism and I am confident in the Canadianism of my constituents. Ninety-five per cent of my constituents who responded to the questionnaire said, "Yes, I want my province or region to remain a part of Confederation in Canada." We have no doubt about our personal Canadianism in Fraser Valley West, but we feel that too much credibility has been given to non-representatives, separatists, vocal minorities.
Mr. Speaker, I want my province to remain in Canada because I am a Canadian. I believe in Canada. I believe in one, strong, united nation.


Some hon. Members:: Hear, hear!


Douglas Roche: Mr. Speaker, as one considers the mathematical formulas in Bill C-37 and also the fact that the legislation is presented to us as a fait accompli, it is no wonder that so many speakers in this debate have sought to take a broad approach to their feelings about Confederation. It is precisely that leadership from the Canadian parliament on the crisis of Confederation at this moment in our history that the Canadian people have a right to expect. I think the Canadian people want to hear from their members of parliament how we feel, what we are going to do to save our country if we hope to hold it intact at this particular moment.
I think it is unfortunate that the Prime Minister (Mr. Trudeau) has not sought to come into the House of Commons to share, the kind of views he expressed in Washington today, to come into the House of Commons and take part in a full scale debate in this House on national unity and the future of our country-a national unity which we could define for the good of the Canadian people. It is not only the threat of the break-up of Confederation and the linguistic and cultural issues that we are facing, but also we will be considering in the debate on national unity the economic problems and regional disparities of our country, because that also is what needs to be

discussed in a broad ranging debate on national unity. That is why the members of this House, as we look back in the debate of the past two days on this bill, have sought to take a wider approach. Members are tired of the great issues of our country being faced and settled in federal-provincial conferences, in TV addresses to the nation, and in speeches to the Congress of the United States. I believe it is here that we ought to be giving the leadership the Canadian people want.
We heard tonight the views of members from Newfoundland and British Columbia about the desire of people in those provinces to stay in Confederation and to respond flexibly to the threat that faces our country right now. I want to say a word about the people of Alberta. I think that not enough positive statements are being heard which truly reflect the feelings of Alberta. I must say to you, Mr. Speaker, that I deeply resent the kind of media coverage some eastern journalists have been giving Alberta when they interview people who say that we in Alberta don't care if Quebec does separate and that our future is not really on the line. I think that such views within Alberta express the feelings of only a very small fraction of the people in Alberta. The people of Alberta I come into contact with want very much to recognize that the problems posed by the November 15 election in Quebec are problems that have to be solved by all Canadians together.
I resent that great Liberal, Bryce Mackasey, going into Alberta and saying that Albertans won't pay the price, that Albertans wont pay the price for staying in Confederation, and then being interviewed on the media as if this was a great discovery which had been made and one worth relaying to the rest of the people of Canada. I think that Albertans are paying the price, and I recognize that we are going to have to go on paying a price for national unity.
I think it is absolutely unfair to depict Albertans as being narrow on this subject, even on the subject of bilingualism and biculturalism. I can tell you, Mr. Speaker, that people in Edmonton line up to get their children into French schools in the city of Edmonton and that there is a thriving French community in the city of Edmonton which enjoys French language television and French language radio and newspapers. Many things have been done in our province to reflect the diversity and the fullness of the Canadian character.
I think it is a calumny to say that Albertans won't pay the price for staying in Confederation when we are already paying the price in energy subsidies which we pass on to the rest of the country through our willingness to take less than world price on energy. Then these are the freight rates. The discrimination in freight rates has been documented in this House for many years.
Speaking about transportation, Mr. Speaker, we think about the decision handed down today by the Supreme Court of Canada in the Pacific Western Airlines dispute which the federal government brought through a series of actions all the way into the Supreme Court. The Supreme Court ruled by a nine to nothing decision today to uphold the province of Alberta in its acquisition of PWA. I think the action of the Alberta government in acquiring PWA for reasons which
February 22, 1977

Premier Lougheed made very clear, namely, that it was essential to development in northern Alberta and to the province's over-all, long-range planning and to diversify its economy, has now been vindicated by the Supreme Court of Canada and is an indication why a flexible federalism is absolutely essential. The provinces do have a right to expand and develop their own regions through a system of transportation along the line Premier Lougheed has indicated.
I think it would be a very serious mistake indeed for the Minister of Transport (Mr. Lang) to carry out the implied threat that he made prior to the handing down of the Supreme Court decision. He implied he would bring legislation into the House to roll back the decision of the Alberta government to acquire PWA. I warn the Minister of Transport, with all the energy at my command, that we will fight any such legislation down to the last post. We will uphold the right of provinces to develop their own regional strengths, including their own transportation systems.
I think more of us in this country are recognizing that regional input is absolutely essential if we are to have the kind of flexible and creative federalism that is necessary and which Bill C-37 allows us to consider in greater fullness. It is essential to be realistic about the extent of the threat that is facing Canada. However, it is more important not to despair or to accept separatism as inevitable. I want to reaffirm to the House tonight that the people of Alberta by no means are accepting the so-called inevitability of separatism. We are going to indicate in the months ahead, by a mobilization of outspoken federalism in our province, that those who are telling the rest of Canada that Alberta does not care are wrong. As I say, I do not think that separatism is at all inevitable. The idea, the emotion, and the power of a united Canada is shown to be stronger and better than Rene Levesque's constricting nationalism.
The alternative to the PQ argument must always be visible. It must be perceived by French-speaking Canadians that they can fulfil themselves culturally in Canada at least as well as they could in a separated Quebec. Certainly a great effort to make the bilingual nature of this country a working reality should not be abandoned. Real progress is being made in the public service and in the schools, and I have given the House an illustration in this regard so far as Edmonton is concerned. Real progress is being made and should be continued.
There are justifiable complaints in western Canada. Indeed, there is a similarity in the expressions of concern and alienation felt within the province of Quebec and those felt in other regions. We heard about Newfoundland tonight. I can tell the House that the people of Alberta also feel a sense of frustration which is caused by an inflexible type of federalism which is maintained by an overly centralist concept administered by the present government. I think we are looking forward to the day when we can have a greater decentralization of powers, and in order to approach this great question we must have the right attitude. In that way we recognize that a compromise is
Federal-Provincial Fiscal Arrangements going to be necessary to hold our country together, in the same way that compromise was necessary in order to build and establish Confederation in the first place.
I look forward, then, to a national debate centring right here in the House which will be about the ways that a compromise can be achieved with honour and with practicality. I think that reason and toleration will help us to understand that what we are talking about is not so-called "giving in", to Quebec, but of implementing new relationships between Ottawa and the provinces that will lead to a deepened sense of national unity. It is in the interests of Alberta as much as Quebec to search for a new mode of Confederation, one that builds nationhood out of the strengths of all regions, rather than imposing a centralized system from the top.
I do not think that this debate is going to be easy by any means, which is why I think none of us should pretend that we have the final answers at the moment. Rather this is the time for speaking and for listening and for moving together, whether in Newfoundland, British Columbia, Alberta or Quebec. Together we must be tolerant of the views of one region or another at this moment when we are trying to find the way in which our country can be held together.
I want to mention that one thing I am going to do as, I hope, a small contribution in my capacity as a member of parliament, where I think I have some responsibility to exert some leadership in finding solutions to this problem, is to hold a Town Hall meeting in Edmonton on March 28 under the title "The Kind of Canada I Want". I am going to invite the people of Edmonton to come and speak from their hearts of their concern for the kind of Canada they want. I am going to invite the media from the province of Quebec to cover this event, and I hope they will convey to the people of Quebec in a direct manner the feeling of the people of Edmonton that they do care and that they are willing to pay the price for holding our country together.
It is not enough, Mr. Speaker, for members of parliament simply to stand and to say they want the country to stay together. I think we have an obligation to give some leadership and to show how we try to lead the way to these solutions, instead of just waiting for them to appear at some federal-provincial conference. If the Canadian parliament is going to re-assert its claim to leadership in this country in the form it was constituted, I think members of parliament ought to be able to advance some solutions to the crisis that faces us.
Speaking only for myself, I think we find a better concept of a more creative kind of federalism through a consideration of the report that was issued by the Joint Senate and House of Commons Committee on the Constitution, which reported to this House in June of 1972 and which did try to find a way between outright balkanization and a centralism that people in many provinces find excessive. I think if we can express a consensus on decentralization we would have a bold, new and exciting way to restore the vitality of Canada.
I see it is ten o'clock, Mr. Speaker; I will continue at a later time.

February 22, 1977
Adjournment Debate



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Fred McCain (Carleton-Charlotte):: Mr. Speaker, on December 7 of last year I asked a question on behalf of some of the fishermen of Grand Manan who had experienced a very serious loss of income as a result of circumstances absolutely and completely beyond their control. These people have presented their case to the staff of the Ministry of the Environment. They have been patient, they have been polite, and they have not been demanding. They have merely presented the facts of the case as they saw them on their own behalf. They made all the expenditures that would have been necessary for a fruitful season, but they reaped no harvest whatsoever as they cast their nets upon the water.
I rise tonight to appeal on their behalf. I think that if we examine the report on expenditures by the Department of the Environment through its fisheries branch, we will find that the department has aided and assisted a great many people in the fishing industry in Canada. It seems only fair, then, that the same spirit, the same degree of recognition, should be shown to these people as has been shown judiciously and properly to others in Canada, including fellow fishermen. I think it is discrimination to leave these people out, particularly so in view of the very gentlemanly position which they have adopted and the very fine way in which they have presented their case.
I think it is necessary to take into consideration the basic economy of the island of Grand Manan. There is probably no community in Canada more dependent upon a single source of income than that island. Except for a very short tourist season which makes some contribution, the income of many on the island is based principally on fish. When any portion of this income is denied fishermen of that area, by virtue of an act of God or man, the economy of the area suffers.
Fishing is not a guaranteed income; by its nature it is cyclical. This is particularly pertinent to this group of fishermen this year because it was one of the perhaps two out of five years they could have anticipated a very generous and adequate income. The weir fisherman is one who must accept that perhaps not more than two out of five years are going to be really prosperous. With good luck in the other years of that five he would recover his investment, and in the fifth year would make virtually nothing.
It is not only unfortunate that a weir may be found to be absolutely fruitless for an entire fishing season, but in this particular season fish were in an abundance rarely seen any-

where, and the anticipated income was the one they needed in the five-year period to give them a decent average.
These people have not made an exorbitant demand upon the public treasury of Canada but merely asked that they be assisted as weir fishermen have been in the past. Their presentation indicated what their income might have been, and they asked that the minister recognize that and give them assistance on a fair basis. Some of their claims have been regarded as very high but I can assure you, Mr. Speaker, in view of the presence of fish at that particular time, they have not exaggerated what their income might have been had not circumstances interfered.
The fishermen of these parts have been hampered by regulations, licensing, and stock control. The income of the area has suffered seriously, and the processing industry has found it difficult to survive. This is an island which I think should have special consideration in every respect in regard to fishing. The licensing structure has hampered them severely. When you have no other source of income, and when it is restricted by the imposition of quotas and licenses, then the flexibility of earning power has been licensed out of existence. A few extra days of effort in another field might have added to their income, but they are denied that. They are abused by the licensing structure. It is not as if these people were on the mainland of New Brunswick or Nova Scotia where they might have an opportunity to earn money from other sources; their basic and only income is from fishing.
I submit that when a group of people such as this is denied the opportunity to reap the harvest through circumstances not of their making, the minister should take that into consideration and treat them as other fishermen in Canada. They should have some compensation.


Mr. Jim Fleming (Parliamentary Secretary to Minister of Fisheries and the Environment):: Mr. Speaker, as the hon. member is well aware, a thorough investigation of the herring kill of last summer has been carried out by the research scientists at the St. Andrews Biological Station in New Brunswick. All evidence indicates that the herring kill was due to natural causes as opposed to an explosion. The results of this investigation, including a report from the Department of National Defence, were brought to the hon. member's attention as well as that of the fishermen involved at a meeting held on Grand Manan a few weeks ago. The claims for the loss of income by the fishermen are understandable, but in the light of these results it has not been possible to compensate those affected by the kill.
However, the minister as well as his officials realize fully that there are a number of problems faced by the weir fishermen which need to be addressed, such as the instability of catches by the weirs. In this connection a second meeting was called by the Department of Fisheries and the Environment to discuss these problems with the weir fishermen. These meetings were well-attended, useful, and have established the potential to implement some long-term changes in the weir fishery, principally the development of a catch-insurance
February 22, 1977

scheme and a more direct involvement of the weir fishermen in the management of the fishery.


TRANSPORT-REQUEST OF ATLANTIC PROVINCES FOR FUNDS TO IMPROVE TRANS-CANADA HIGHWAY-GOVERNMENT POSITION
Mr. Jack Marshall (Humber-St. George's-St. Barbe):: Mr. Speaker, the purpose of my short comments tonight is to elaborate on my question of December 2 last to the Minister of Transport (Mr. Lang) with regard to the submission by the transport ministers from the Atlantic region on the desperate need for a highway strengthening program in the Atlantic region. Elowever, as selfish as it may seem, I am particularly concerned about the deterioration of what can only be referred to as a fourth class Trans-Canada Highway in my part of the province in western Newfoundland, particularly between Port aux Basques, through St. George's, Stephenville, Corner Brook and on to Deer Lake. These are five communities which comprise the comparative urban areas of western Newfoundland. This too is part of Canada.
This section of the Trans-Canada Highway and connecting links form the basis of an interconnecting highway system which is vital in the building of an economic base for western Newfoundland. While I realize that it must fit in with an over-all transportation plan for the province, the extreme pressure placed upon the use of the present system has indeed reached alarming proportions. The pressure on the increasing use is brought about by the fact that the available system of rail for the transportation of goods and services has deteriorated to a point where the basic industries have had to turn to rubber transport in order to compete in far off markets, and I refer mainly to our basic pulp and paper industry and the linerboard industry in Corner Brook and Stephenville. This has resulted in the increased traffic of tractor-trailors to the point where it is becoming absolutely dangerous for vehicular traffic other than the massive tractor-trailors which have been travelling the roads in ever increasing numbers in the past years. I can only stress that unless something is done on an emergency basis, we will all regret what is likely to happen.
The frustration which I have to endure at the evident procrastination of the government is that it appears that in spite of the countless studies on transportation which have been undertaken, there will now be further delays as a result of the impending appointment of a royal commission to study once again transportation problems in my province, when as recently as 1974 a voluminous study was produced on the trans-Newfoundland corridor transportation. I do not recall how many volumes there were, but volume C on the Trans-Canada Highway gives a complete picture of the conditions, the requirements, the cost, and the expected benefits. It goes into every detail which time will not permit me to go into tonight. I wonder why the government has to await another study before taking any action.
It adds to my frustration to know that there is a fundamental lesson we should all have learnt from history, that the basis of any economy in developing an area to take advantage of its
Adjournment Debate
resources is a proper transportation system. However, to add further to my frustration I read today a news release by the minister announcing a $30 million agreement for construction and improvement of highways in the northern part of the province of Alberta. I say God bless Alberta, it deserves it, but I ask, how long do we in Newfoundland have to wait for the infrastructure support necessary to give us a transportation base which is so vital to our future economy?
Just yesterday the minister indicated in reply to a question of mine that as a result of meetings with the Atlantic transportation ministers an agreement was reached to divert funds from other programs and to direct those funds toward the highway strengthening program for the Atlantic region. I sincerely hope that this will come about, and while it is a foregone conclusion that the royal commission study will come into effect, I hope the minister will, as he indicated to me previously, demand that the transcorridor study be referred to and become an important part of the relative factors to be considered by the commission to avoid further delays.
Even though the transportation studies will go through another process of delay, it is most important that on an emergency basis implementation of highway improvements take place in Newfoundland, regardless of the over-all acceptance of a policy for the province which will fit in with Canada's over-all new transportation policy, which I hope will be to the benefit of all Canadians.
I hope that the very capable parliamentary secretary to the minister will be able to give me answers which I can relate to the people of Newfoundland, and I hope he will assure them that this necessary transportation system will be made available by the government he represents.


Mr. Marcel Roy (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, I wish to thank the hon. member for raising this important matter. 1 appreciate this opportunity to speak on this subject this evening for two reasons: because of its subject matter, and because the hon. member has raised this matter on a historic day for all Canadians. The President of the Privy Council (Mr. MacEachen) mentioned today during question period the visit of the Prime Minister (Mr. Trudeau) to the President of the United States.
On March 10, 1976, the Atlantic ministers responsible for highways met with the Minister of Transport (Mr. Lang) in Ottawa. They presented to him with their joint submission for a ten-year highway program of assistance for the provinces to strengthen and improve primary highways in the Atlantic region, including the Trans-Canada Highway. The proposal involved the strengthening and upgrading of more than 2,000 miles of highways in the four provinces.
In the months following the presentation of the submission Transport Canada has carried out an economic analysis of the projects which the Atlantic provinces considered to be of particularly high priority. As the hon. member might appreciate, this has been a time-consuming task, due to the number of

February 22, 1977
Adjournment Debate
projects involved and the need to collect data on which an accurate analysis could be based.
As the hon. member is aware, the Minister of Transport is pleased to join with the government of Newfoundland in the appointment of a commission which will examine a range of transportation problems in his native province.
The question of federal assistance for primary highways in the Atlantic provinces was specifically discussed, among other things, when the minister met with the maritime premiers and the Newfoundland minister of transportation a few weeks ago, on February 7, and as the minister noted in the House on February 21 there was agreement in principle with the general idea that certain moneys which otherwise would have been spent in the Atlantic region in relation to certain programs- and it was agreed that those moneys were not particularly serving their original purposes of promoting development- would be diverted toward such matters as a highway strengthening program.
As the minister also pointed out, that agreement in principle will be worked out in detail in the next few weeks in terms of concrete actions and programs. In this regard it is hoped that an announcement will be made in the relatively near future.
In closing I would remind the hon. member for Humber-St. George's-St. Barbe (Mr. Marshall) that the question he raises tonight respecting highway upgrading is very much associated with the nature of rail services to be offered and also with the kind of marine services which will be available in the future.


EXTERNAL AFFAIRS-CUBA-SUGGESTED RECONSIDERATION OF RELATIONSHIP IN VIEW OF SUPPORT OF RHODESIAN GUERRILLAS
Benno Friesen: Mr. Speaker, on February 9 I rose to ask the Prime Minister (Mr. Trudeau) the following question, as reported on page 2873 of Hansard:
... In view of the massacre of missionaries in Rhodesia by guerrillas, and in view of the admission by Cuban officials that their Montreal offices are used for training guerrillas and the fact that these guerrillas are destined for Rhodesia and carry on continuing murder and harassment of missionaries, will the Prime Minister reconsider Canada's relationship to Cuba as well as its generous financial and material aid to that country?
I could not help being shocked by the callous and unfeeling effrontery of the Prime Minister's reply. He said:
No, Mr. Speaker. I believe tnat the question is based on a non sequitur. He might just as well ask if we are going to reinforce our delegation to the Vatican and help from that side.
That question did not come out of the blue. It stems from the obvious contradiction inherent in the government's foreign policy.
On February 2, 1976, the hon. member for South Shore (Mr. Crouse) directed the following question to the then secretary of state for external affairs, as reported on page 10520 of Hansard:
As the Cubans landed two unscheduled flights in Canada where they were refuelled, while en route with Cuban troops for the fighting in Angola, will the minister inform the House what steps he has taken to inform Premier Castro of Canadian displeasure over this action and whether any steps have been taken to

prevent the recurrence of this procedure, in order to prevent Canada from being directly embroiled in this conflict?
The then secretary of state for external affairs answered as follows:
... we have made it plain to the Cuban authorities that we would reserve the right to inspect in future such unscheduled flights. We have also made it clear that we would not tolerate-
I emphasize the words "would not tolerate".
-any such use of Canadian facilities for military purposes if, indeed, that was the case.
That same day the hon. member for Esquimalt-Saanich (Mr. Munro) asked the following question, as reported on page 10518 of Hansard:
I wonder if the minister could assure us that Canada has taken steps to refuse further refuelling stops for Cuban aircraft at Gander at least until Cuba repatriates its troops from Angola. After all, Guyana and Barbados refused permission for stops; why not Canada?
The next day, on February 3, 1976, the former leader of the opposition, the hon. member for Halifax (Mr. Stanfield), pointed out to the Prime Minister that in view of the Angola crisis it would be quite normal for the Prime Minister to postpone his pending visit to Cuba. He said, as reported on page 10569 of Hansard'.
Accepting that Canada and the Prime Minister's government disapprove of foreign adventurism of the sort that Cuba is pursuing in Angola, why did the Prime Minister not take this opportunity to make this point very effectively to Cuba and to the world by simply postponing his visit to Cuba at this time?
He went on to say, as reported at page 10570 of Hansard'.
Despite what the Secretary of State for External Affairs said as a result of the visit of the Prime Minister, the general perception abroad is that it was great for Fidel Castro. What did it do for Canada?
The hon. member for Victoria (Mr. McKinnon) then asked the following question:
Can the minister inform us if there have been any flights recently by Warsaw Pact countries which used Goose Bay airport as a staging or refuelling point between Cuba and points in east Europe or Africa?
The then secretary of state for external affairs replied in part:
... I believe that there have been two scheduled flights in the last months to Cuba stopping down at Goose Bay.
The right hon. member for Prince Albert (Mr. Diefenbaker) then asked the Prime Minister questions about conversations with Fidel Castro. He asked, as reported on page 10572 of Hansard:
What did he say with regard to Angola?. . . What did. he say? Instead of evading the subject just tell the House, even though the language be brutal.
The Prime Minister answered in part:
In so far as Premier Castro's views, he made them known to me. I have the feeling that he has a good knowledge of Africa and a good feeling for the realities there.
That took place one year ago. Since then we have had a startling revelation by an American, David Bufkin, who was recruited by the Cubans in Mexico and trained in Montreal, and then turned a double agent in Rhodesia. That revelation amounts to a barefaced admission on the part of the Cubans that they were using their facilities in Canada to train guerril-
February 22, 1977

las in Montreal. It was being done on Canadian soil. This is done in order to further the cause of the revolution in Cuba. My question to the Prime Minister again is what are we doing with regard to our relationship to Cuba in light of our continuing foreign aid, preferential tariffs in our trade relations with Cuba, and the 3 per cent loans? It is about time we called a spade a spade. If the Cuban people need foreign aid from us, by all means let us give it to them. However, in light of what the Cubans have been doing under the leadership of Fidel Castro, if their economy is good enough that they can export the most heinous and callous commodity imaginable, that of revolution and refined guerilla warfare, it is time to re-evaluate our position with regard to Cuba.
It is time that the Canadian people and the world know exactly what our foreign policy is with regard to these countries that want to export revolution. I therefore ask the parliamentary secretary to clarify once and for all the position of the Canadian government in relation to a country that insists on exporting revolution and ravishes the sanctity of Canadian soil is so doing, and not just give in return a token expulsion of Cuban diplomats.


Mr. Fernand E. Leblanc (Parliamentary Secretary to Secretary of State for External Affairs):: Mr. Speaker, I want to congratulate the hon. member for Surrey-White Rock (Mr. Friesen) for raising such an important question as the presence of Cuban mercenaries in Rhodesia.
Adjournment Debate
However, it seems that the department was not sure about the question the hon. member was going to raise tonight because I have been given an answer which applies to the massacre of missionaries in Rhodesia following interventions by people who went to work and wage war in that country.
It is unfortunate that I should not be able to give him the answer he is entitled to expect but since there was confusion in the two questions which had been raised on February 9 about the massacre of missionaries in Rhodesia and the presence of Cubans, and even though the same question had been raised by other members of his party, unfortunately I do not have the answer and I think the matter might have to be taken up another night on the late show so that departmental officials will then prepare the satisfactory answer which the, hon. member for Surrey-White Rock is certainly entitled to expect.
Once again, I am sorry and I humbly admit that there was confusion in the department. They must have thought that the question the hon. member was going to raise tonight had to do with the massacre of missionaries. But he raised the other question about the presence of Cuban people in Rhodesia. I am very sorry-


Benno Friesen: Mr. Speaker, I rise on a point of order.


The Acting Speaker (Mr. Ethier):: Order, please. The Chair cannot accept a point of order at this time.
The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 2 p.m.
Motion agreed to and the House adjourned at 10:27 p.m.


Wednesday, February 23, 1977