1977-06-17

Mr. Dean Whiteway (Selkirk):: Mr. Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43. One year ago in this House I objected to the cancellation of the festivities on Parliament Hill which normally took place on Dominion Day. In light of the recent recognition by the government of Canada that a display of "flag waving patriotism" is not such a bad idea, and in view of the fact that a vast majority of Canadians want an opportunity to display their love and pride of Canada, I move, seconded by the hon. member for Winnipeg South Centre (Mr. McKenzie):
That the Minister of State responsible for the Dominion Day Parliament Hill activities incorporate in a prominent way the man who refers to himself as the only living Father of Confederation, Joseph R. Smallwood, and the only living former prime minister, the distinguished right hon. member for Prince Albert (Mr. Diefenbaker), and indeed the national leaders of the other political parties so that a national perspective and non-partisan spirit would prevail in the celebration on Parliament Hill in this first decade of our century.


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EXTERNAL AFFAIRS
Mr. David Orlikow (Winnipeg North):: Mr. Speaker, I rise under the provisions of Standing Order 43 seeking unanimous consent on an urgent and pressing matter. In the spirit of the motion moved by the hon. member for Parkdale (Mr. Hai-dasz), and agreed to by the House unanimously on Wednesday, June 15, in connection with the Belgrade Conference on the Helsinki Final Act, I move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House call on the representatives of Canada at the conference to make it clear to the delegates from the Soviet Union that the people of Canada expect the Soviet Union to live up to the promises made by all the countries which signed the Helsinki Charter, and to permit Soviet citizens who wish to leave that country to do so.


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.

[DOT] (mo)


REASON FOR PERMITTING ALLEGEDLY INADEQUATE MEDICAL DEVICES-MOTION UNDER S.O. 43
Mr. Paul Yewchuk (Athabasca):: Mr. Speaker, I rise on a matter of urgent and pressing necessity under the terms of Standing Order 43. In view of the statement made by the assistant deputy minister in the Department of National Health and Welfare recently that as a result of faulty testing devices, a large number of the abortion procedures initiated in this country are performed on women who are not in fact pregnant, and in view of the minister's reported characterization of a number of medical devices, such as anaesthetic machines, incubators and heart pacers, as being as inadequate as they were "frightening", I move, seconded by the hon. member for Oxford (Mr. Halliday):
That the Minister of National Health and Welfare make a statement on motions explaining why he has allowed an intolerable threat to the health of Canadians to develop in the form of inadequately regulated medical devices.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
80018-27'A

June 17, 1977
The Canadian Economy ENERGY


APPROVAL OF ACTION OF GOVERNMENT IN SUPPORTING PRICE OF URANIUM-MOTION UNDER S.O. 43
Mr. Maurice Foster (Algoma):: Mr. Speaker, pursuant to the terms of Standing Order 43, I request the unanimous consent of the House to present a motion dealing with a matter of urgent and pressing necessity.
Whereas in the early 1970's the United States government saw fit to close its borders to foreign uranium; and whereas other producing countries, including Canada, could no longer compete for that large market; and whereas it was in the national interest of Canada to maintain a uranium industry for the ongoing health of communities such as Elliot Lake; and whereas United States companies continued to compete aggressively in other world markets during this period; and whereas the Canadian government was a member of a producers group which maintained a base export price; and whereas a committee of the U.S. Congress has, over Canadian objections, released confidential Canadian government documents and is thereby determining what is in the Canadian public interest, I move, seconded by the hon. member for Battleford-Kindersley (Mr. Mclsaac):
That this House support the action the Canadian government took in belonging to a producers group which was necessary for the economic survival of the Canadian uranium industry and that the Secretary of State for External Affairs should make a strong official protest to the American government in this matter of extra territorial application of American law in Canada.


Mr. Speaker:: Before such a motion can be presented the unanimous consent of the House must be obtained. Is there unanimous consent?


Some hon. Members:: Hear, hear!


Some hon. Members:: No!


THE CANADIAN ECONOMY
Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker,
I rise on a matter of urgent and pressing necessity under the terms of Standing Order 43. My motion is prompted by recent statements by the Minister of Industry, Trade and Commerce (Mr. Chretien) to the effect that Canadians are a society of bitchers. In the light of the mess Canada is in, with an ail-time high of over one million unemployed, record inflation due to excessive printing of money, uncontrolled government spending, a record debt and record borrowing-to name just a few problems caused by the Liberal government, which has proven to be the most irresponsible group of elected officials in Canadian history-and since it is the democractic right of every citizen to complain about such problems, I move, seconded by the hon. member for Selkirk (Mr. Whiteway):
That this House endorse the right of every citizen to complain about the disastrous economic state of the nation and that the Minister of Industry, Trade

and Commerce publicly apologize to all Canadians for his statement that we are a society of bitchers.


Mr. Chretien:: I just have to listen to you to be convinced!


PRESENCE IN GALLERY OF ATTORNEY GENERAL OF UNITED STATES, MR. GRIFFIN BELL
Mr. Speaker:: Before beginning the question period, 1 know all hon. members will wish to join with me to mark not only the presence of a distinguished visitor, Mr. Griffin Bell, in our gallery but a very auspicious occasion, being the first official visit to Canada of an Attorney General of the United States.


Some hon. Members:: Hear, hear!



ORAL QUESTION PERIOD


Mr. Joe Clark (Leader of the Opposition):: Mr. Speaker, I want to begin by welcoming back to Canada and the House of Commons the Prime Minister.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: I want to say that we on this side of the House are particularly pleased that on the question of Uganda the Prime Minister has now moved toward the position which he and his colleagues rejected in a Standing Order 43 moved by my colleague, the right hon. member for Prince Albert, four months ago tomorrow.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: I would like to ask the Prime Minister whether the Commonwealth conference discussed the possibility, in addition to their statement of condemnation, of undertaking commercial sanctions against Uganda.


Right Hon. P. E. Trudeau (Prime Minister):: Yes, Mr. Speaker, the question was discussed. In writing the final communique a decision was taken not to take any step in that direction. There was not enough preparation of the step and not enough consensus concerning the step.


Charles Joseph Clark: That speaks of the consensus among all the members of the Commonwealth. We would like to know what the position of the government of Canada is on that question. As the Prime Minister knows, the United Nations Security
June 17, 1977

Council resolutions now in effect call for a complete interdiction of trade against countries such as Rhodesia, except for humanitarian and medical needs. I would like to ask the Prime Minister whether Canada will apply the same kind of economic sanctions against Uganda.


Pierre Elliott Trudeau: No doubt, Mr. Speaker, if the United Nations Security Council and the United Nations itself decided to extend the boycott to Uganda as it does to Rhodesia, we would support it.


Charles Joseph Clark: Mr. Speaker, I am pleased to see that the Prime Minister in his absence has lost nothing of the fealty of the Liberal party to the policy of waiting for somebody else to initiate action.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: The Minister of Justice waits for the city of Toronto and the province of Quebec to start inquiries that he should start. I would like to ask the Prime Minister whether he will show some leadership here and not wait for other agencies, nations or groups to act, and will tell us now whether the government of Canada, acting on its own, making its own decisions, will apply those kinds of sanctions against Uganda?


Pierre Elliott Trudeau: When the hon. member says "those kinds of sanctions against Uganda" I would really like to know what he has in mind. If he wants us to do towards Uganda what we are doing towards Rhodesia, the answer is no, but if the hon. member has a list of countries of whose policies he disapproves and with which he wants us to interrupt commercial relations, I would be happy to have it.


Some hon. Members:: Oh, oh!


REASON FOR TREATING UGANDA DIFFERENTLY FROM RHODESIA
Charles Joseph Clark: What we would like to know, so that we might have some idea as to whether there is any substance or just public relations to what went on in London, is why the government of Canada is going to treat Uganda in a different way from the way it is treating Rhodesia.


Pierre Elliott Trudeau: Very rarely do the nations of the world and the United Nations decide collectively to extend sanctions to one country. They have done this for Rhodesia but for no other country, and that is the reason.


COMMONWEALTH GAMES
Mr. Walter Baker (Grenville-Carleton):: Mr. Speaker, I would like to ask the Prime Minister a question about Ugan-
Oral Questions
da's participation in the Commonwealth Games. Last week in London the Prime Minister stated that if Idi Amin uses the Ugandan team to glorify his name or his regime, it would be barred from the games. Of course, that ignores the question of how we would tell if the Ugandan team were glorifying the president until it actually arrived on the scene. I want to report to the Prime Minister that while he was away the Secretary of State for External Affairs told the House that it would be highly unlikely that Amin would be invited in any event. There seems to be some equivocation in the position stated by a minister of the Crown, whom I heard whisper to the Prime Minister that he was only expressing a personal opinion. I think this cloud of equivocation should be cleared up. Can the Prime Minister tell the House whether it is the government's intention that Uganda be barred from the Commonwealth Games this year?


Pierre Elliott Trudeau: Mr. Speaker, I do not see the contradiction that the hon. member is pointing out between what the minister said and what I said. If President Amin comes as a weightlifter or a javelin thrower, as a sportsman, then I would consider the matter. However, we do not know that he is a member of any athletic team, and therefore the question is hypothetical.


Walter David Baker: Mr. Speaker, the Prime Minister knows that Amin is a grand basketball player. Perhaps the hon. member for Hamilton Mountain could be used as the ball. But the Prime Minister did not answer my question. It was a very clear one. Would the Prime Minister tell the House whether it is the intention of the government that Uganda be barred from the games? That is a pretty straightforward question.
While he is dealing with that, would he also be prepared to deal with the statement made by the Ugandan High Commissioner to Canada, who stated that it would be a good idea for Amin to visit Canada. I do not believe the Canadian people would agree with what the High Commissioner said, and I hope the Prime Minister would not agree. Would the Prime Minister make it clear that President Amin is barred from this country?
So there are two questions: What is the intention of the government with respect to barring Uganda from participating in the games, and what is the position of the government with respect to allowing Amin to come into this country?


Pierre Elliott Trudeau: Mr. Speaker, I do not know if Uganda plans to send a team of athletes to the games. This is what I answered in London. As far as I can see, the question is hypothetical. If Uganda decides to send a team, including its leader, we will then study the circumstances of that. I would not say in advance that we would automatically bar Uganda. That would very much depend on whether they were planning to come and on the circumstances under which they would come. As far as the leader is concerned, the question is completely hypothetical. There has been no invitation extend-

June 17, 1977
Oral Questions
ed to General Amin to come to Canada, and therefore I do not see what the hon. member wants me to answer. I just remind the hon. member that there are 60 Canadians in Uganda, and we do not want their lives to be jeopardized.


Some hon. Members:: Hear, hear!


ADMINISTRATION OF JUSTICE
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I have a question for the Prime Minister on a different subject. In the past the Prime Minister has shown deep and genuine concern about civil liberties and the principle of the rule of law. On June 10 in this House the Minister of Justice said, and I quote: "The police forces of this country, including the RCMP, are as subject to the criminal law of the country as any other citizen". The Minister of Justice went on to say in the same statement in this House on that date that if a violation of the law took place by the RCMP, "the proper action will be taken". Considering that the three policemen, including one senior RCMP officer, who admitted their guilt in taking part in an illegal break-in in Montreal have been given an unconditional pardon, will the Prime Minister request the minister of justice in Quebec to appeal this decision?


Pierre Elliott Trudeau: Mr. Speaker, I will consider the suggestion. I do not know what intention the minister of justice of Quebec has in this regard. I understand he has announced the institution of an inquiry. I do not know if he wants to pursue the judicial matter any further. The hon. member realizes that the administration of justice in this case comes under the jurisdiction of the attorney general of the province of Quebec. However, I will try to find out what his intentions are.


John Edward Broadbent: Mr. Speaker, I appreciate that answer. It is remarkably different in substance and tone from the answer given in the House yesterday by the Minister of Justice. However, considering that the inquiry which has been launched by the government of Quebec into this incident may go on for some weeks, and indeed, some months, considering the very important principle of the rule of law that the same law must be seen to apply to the police forces of Canada as it does to ordinary citizens, and if the inquiry which is now under way produces no early recommendation on this specific decision-let us say in the next couple of weeks-would the Prime Minister undertake, as the leading citizen of Canada, to request the minister of justice of Quebec to appeal this particular decision?


Pierre Elliott Trudeau: Mr. Speaker, I will consult with the Minister of Justice on this matter.


FINANCE
Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, my question is directed to the Minister of Finance.
Since I gave him notice of my question, I hope that he will be in a position to give me a clear answer. In view of the fact that a press release from the office of the Minister of Agriculture mentions that the cabinet has approved as a matter of policy a marketing board for broiler chickens, and since the setting up of such a board is a rather long process, could the minister assure the poultry producers that steps will be taken to protect them against massive imports until that board is set up and fully operational?


Hon. Donald S. Macdonald (Minister of Finance):: Mr. Speaker, I thank the hon. member again for giving me notice of his question. I had the opportunity to discuss this matter with the officials and I believe that, according to the procedure to be followed, the Minister of Agriculture will be consulting his provincial counterparts about a marketing system. After having obtained the consent of provincial governments for setting up such a system, he will report to cabinet, and then, in co-operation with the Minister of Industry, Trade and Commerce, it will be possible to implement the provisions of the exports and imports legislation in order to regulate the international poultry trade. As for the time required, in reply to the question put by the hon. member a few days ago, I would say that this depends on the progress of the consultations with provincial governments.


EXTERNAL AFFAIRS
Mr. James Gillies (Don Valley):: Mr. Speaker, my question to the Secretary of State for External Affairs arises out of reports emanating from Washington of alleged operations in Canada of a cartel to fix uranium prices. First of all, may I ask the minister if it is part of our foreign policy to believe in and support commodity agreements such as OPEC and others; second, have we made it clear to all our trading partners that Canada was in favour of commodity agreements as a way of supporting world prices; third, was this made specifically clear at the UNCTAD conference with Third World countries where I understand they were very much in favour of commodity agreements but Canada took the position that we were not in favour of these cartels and finally, have the negotiators for Canada at GATT been instructed to make very clear to other countries that Canada does in fact believe in cartel arrangements to support commodity prices?


Hon. Donald C. Jamieson (Secretary of State for External Affairs):: Mr. Speaker, there were about five questions in one

June 17, 1977

there. On the specifics of the uranium arrangement, I would ask Your Honour to permit my colleague the Minister of Energy, Mines and Resources to reply. On the question of commodity agreements 1 think the Canadian position, briefly stated, although there are of course many additional comments that 1 could make, is that we have said we are not opposed in principle to commodity arrangements; indeed, at the north-south conference we indicated support in principle, as did most developed countries. We have said, however, that this must be considered on a commodity by commodity basis and that it should involve both supplying and consuming countries. I will be glad to give the text of the Canadian position to the hon. member. Perhaps Your Honour might allow the Minister of Energy, Mines and Resources to reply on the uranium question.


Hon. Alastair Gillespie (Minister of Energy, Mines and Resources):: Mr. Speaker, there were two specific points 1 think the hon. member was concerned about. He mentioned the question of secrecy; there was no secrecy with respect to the producers' group arrangement at all. This was made clear right from the start. The second point which I think is important is that Canada, given the circumstances-and I think the hon. member should understand that when 70 per cent of the world market is closed to Canadian producers and others, action has to be taken to protect Canadian industries and Canadian jobs. We tried to get a producer and consumer arrangement but unfortunately we were not able to get consumers alongside at that time so the arrangement became a producers' arrangement. Subsequently, that is to say in 1975, it was possible to disband the producers' arrangement and substituted a producer-consumer dialogue through the formation of the Uranium Institute. The Canadian position, which has always been to have producers and consumers part of these arrangements, has now been brought around again through the formation of the Uranium Institute.


COMBINES
[Stage Direction]
Oral Questions
whether such investigation is in progress. I shall neither confirm nor deny the existence of any investigation in this particular case.
Charles Joseph Clark: It is a question of policy.


Mr. Abbott:: I assure the House that the director has been following the situation closely for evidence of violation of the act, including any indication that the Canadian consumer has been adversely affected by the cartel arrangement which I understand was designed to exclude price fixing in the Canadian market.
With respect to the effect of the cartel on foreign customers and our country's image abroad, the cartel arrangement was implemented to hold the uranium industry over a particularly difficult period, and I am pleased that the government withdrew its support of the arrangement as soon as possible, shortly after prices began to rise in 1974.


James McPhail Gillies: Mr. Speaker, a final supplementary question to the Minister of Consumer and Corporate Affairs. I am not remotely interested in whether the director of the program is making an investigation. My question is specific and I wonder if the minister could direct his mind to it.


Charles Joseph Clark: It is a question of policy.


James McPhail Gillies: My question is, what is the policy of the government? Is it the policy of the federal government of Canada to allow cartels to be formed when the government has a participatory interest in one of the organizations, but not to allow the formation of cartels if there is no governmental participation? It is a simple question of policy and has nothing to do with an investigation.


Charles Joseph Clark: Do you have a piece of paper on that, Tony?


Anthony Chisholm Abbott: No, I do not have a piece of paper on that, Mr. Speaker. I simply say, the law is there, and it is the duty of the director to investigate and inquire under the law. Beyond that I shall not comment on what government policy might be.


Charles Joseph Clark: Do you know.


GOVERNMENT POLICY ON CARTELS
James McPhail Gillies: Mr. Speaker, may I direct a supplementary question to the Minister of Consumer and Corporate Affairs? Is it the government's policy to have two laws applying to cartel arrangements, one law saying that cartels are appropriate if the Canadian government has a participatory interest in a firm involved in the cartel, another saying cartels are not in the public interest if the Canadian government does not have a participatory interest?


Mr. Fraser:: Yes or no.


Anthony Chisholm Abbott: Mr. Speaker, it is not my normal practice to comment on how the director of combines may interpret the law, whether he may commence an investigation in any case or


Anthony Chisholm Abbott: It would be quite outside my jurisdiction to do so.


THE CANADIAN ECONOMY
Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, I direct my supplementary question to the Minister of Finance. Since the minister has made many statements concerning OPEC-type pricing as being one cause of inflation, does he feel that the cartel with respect to uranium to which we are referring was possibly another cause of inflation?

June 17, 1977
Oral Questions


Donald Stovel Macdonald: Mr. Speaker, 1 point out to the hon. gentleman that the arrangement in this case was to provide for the protection of a significant Canadian industry which was operating at that point below the costs of production, principally because of the misguided actions of the United States government. I think one can say accurately that uranium utilities and therefore consumers in Canada, the United States and elsewhere have been protected from inflation by keeping the additional Canadian production in uranium in force through the difficult years of the early 1970's. In this respect I think one of the best prospects we have for protecting ourselves against further OPEC-type increases lies in having further uranium production.


James McPhail Gillies: In other words, another OPEC arrangement.


Donald Stovel Macdonald: I point out to the hon. member for Don Valley that at all times the government of Canada made it clear that consuming and producing countries should participate in this and that the United States in particular could have participated if it had not been following such an exclusionary policy itself.


REASON FOR ALLEGED ATTEMPT TO KEEP URANIUM PRICING ARRANGEMENT SECRET
Sinclair McKnight Stevens: A supplementary question, Mr. Speaker. Since the minister last night on national television seemed to take great exception to the fact that a friendly nation, as he called it, would allow these types of facts to be revealed, and in view of the answer he gave just now, would he say why he feels it is so desirable to keep this type of agreement or, as the Minister of Energy, Mines and Resources calls it, producers club secret? Why did he feel it so desirable to keep it secret?


Donald Stovel Macdonald: Mr. Speaker, it was far from being kept secret, for, as the Minister of Energy, Mines and Resources said, press releases were issued at the particular time announcing the formation of the arrangement. The objection I raised on television last night was that the United States would seek to apply its laws in Canada, against the laws of the government of Canada, and I do not regard that as a friendly act.


INQUIRY WHETHER OPEC COUNTRIES TOOK URANIUM PRICING ARRANGEMENT AS PRECEDENT
Sinclair McKnight Stevens: A final supplementary question, Mr. Speaker.


Mr. Hees:: Big brother is listening.


Sinclair McKnight Stevens: Since the producers club, as the Minister of Energy, Mines and Resources calls it, was established before the formation of OPEC, will the minister say to what extent he feels the OPEC nations took this as a legitimate precedent they could follow?


Donald Stovel Macdonald: Mr. Speaker, I point out to the hon. member that OPEC was formed some seven or eight years before this.


Sinclair McKnight Stevens: I am talking about the cartels' formation.

[ Translation]


HISTORIC SITES
Mr. Dennis Dawson (Louis-Hebert):: Mr. Speaker, I should like to put a question to the Minister of Indian Affairs and Northern Development.
Is it true that the National Battlefields Commission denied access to the Plains of Abraham to those organizations wishing to use the site for the Saint-Jean celebrations. If so, for what reasons, and does he intend to answer the telegram sent by Mrs. Maltais in that connection?


Hon. Warren Allmand (Minister of Indian Affairs and Northern Development):: Mr. Speaker, the decision to which the hon. member refers was made by the Commission des champs de bataille nationaux, which is an independent body established by an act of parliament. All members of that commission are from Quebec city. I was not aware of the request to use the Plains of Abraham; I was not aware of the decision, nor involved in it in any way. I only learned about it yesterday when it was brought to my attention by the press. Immediately afterwards I sought the reasons from the commission for its refusal. The reasons given to me were that in the past the Societe Saint-Jean-Baptiste had co-operated with the Corporation des fetes de la Saint-Jean and they had put on one celebration together. But this year, for some reason, they had divided and there were two requests, the request of the Saint-Jean-Baptiste Societe was granted and they will be given the use of the field. The other request was turned down because there had been many complaints made against the Corporation des fetes, and also because there was some evidence of unreliability. However, I have asked the commission to re-examine the question and I expect they will do that.


CONSUMER AFFAIRS
Mr. Heward Grafftey (Brome-Missisquoi):: Mr. Speaker, my question directed to the Minister of Consumer and Corporate Affairs has to do with the government's announcement last week on food policy. In view of the minister's assertion that the establishment of a national food policy will remain a high government priority, and since the food strategy for Canada, as demonstrated last week, is only in the discussion
June 17, 1977

stage, in fact there is only a discussion paper on it, when can consumers of Canada expect to have in place a well defined, co-ordinated and comprehensive national food policy? What are the time parameters the minister has in mind for announcing such a comprehensive food policy?


Anthony Chisholm Abbott: Mr. Speaker, the announcement was of a food strategy, the outlines of which will be continually filled with ongoing programs. For instance, one of the benefits we hope to provide consumers is improved price information. I am working vigorously to produce such a response to that strategy point, and hope to do it early. We are also following other areas, including a study of various sectors of the food industry, to see that they are competitive and I shall be announcing developments in this regard promptly.


William Heward Grafftey: A supplementary question, Mr. Speaker. I would ask my question again, Mr. Speaker. When can all these ad hoc actions be accomplished and put in place, so that the government can announce at one time a national, comprehensive food policy? In view of the government's quest for public discussion of a national food policy, will the government table the DM-10 draft of a possible national food policy and other relevant discussion material, so that the public can react to concrete suggestions rather than to the vague declarations of last week? Will the minister publish these documents, and when can all these ad hoc programs be put together, in order that the Canadian people can have that comprehensive package?


Anthony Chisholm Abbott: Mr. Speaker, I do not share the hon. member's view as to the quality of the food strategy paper. The whole purpose of such a broad strategy is that as policies are developed and initiatives are taken, they will fit within the umbrella of this strategy. As to the question of studies related to the preparation, or what the hon. member refers to as DM-10, I do not know what exists in that area but I doubt if it would be very useful to introduce it into the discussion.


EXTERNAL AFFAIRS
David Orlikow: Mr. Speaker, I wish to direct a question to the Secretary of State for External Affairs. In view of the fact that the Soviet Union despite having agreed at Helsinki, along with many other countries, to the principle that citizens should have the right to leave the country in which they live if they so wish, and since the Soviet Union is refusing to issue exit permits to some of its citizens who wish to leave, will Canada's representative at the conference now being held in Belgrade make it clear to the Soviet delegates publicly that the Canadian people hope that the
Oral Questions
Soviet government will honour the commitments it made at Helsinki with regard to the human rights of its citizens?


Donald Campbell Jamieson: Mr. Speaker, I have answered this on several previous occasions. I welcome the chance to do it once again. Yes, we will make such representations in the kind of language that the hon. member has used and our delegation has been so instructed. I should, however, re-emphasize for the House a problem which seems to have arisen in terms of understanding what this conference is about. The meetings now underway are for the purpose of setting an agenda for September. There will not be any public declarations or statements. It is an official level meeting designed to set up the planning for the September meeting. At the appropriate time we will make the public declaration.


DOMINION DAY
Dean Waldon Whiteway: Mr. Speaker, my question is to the Prime Minister. It has to do with the celebrations that will be taking place on Parliament Hill. This will be a welcome reversal from last year when the celebrations were abandoned. Will the Prime Minister tell the House in what way he intends to use the man who considers himself to be the only living Father of Confederation, the Hon. Joseph R. Smallwood, the right hon. member for Prince Albert, a former Prime Minister, and other leaders of the official national parties in those celebrations on Parliament Hill in order to remove any nonpartisan spirit and make a clear demonstration of unity and the love that all of us have for this country.


Pierre Elliott Trudeau: Mr. Speaker, I do not know the details of the celebration. We will keep in mind the personalities the hon. member mentioned. We might ask them to start the fireworks. I will see what is being done.


NORTHERN AFFAIRS
Mr. J. R. Holmes (Lambton-Kent):: Mr. Speaker, my question is for the Minister of Indian Affairs and Northern Development. It arises out of recent comments made by the Minister of Regional Economic Expansion regarding the high cost of food in the north. Is the minister aware of a resolution that was passed at a consumer workshop in Pangnirtung in March of this year which states, and I quote "Only that food should be subsidized by boat and air rates as liquor now is and the savings passed on in total to the consumer."
6788

June 17, 1977
Oral Questions


William Warren Allmand: No, Mr. Speaker. I am not aware of that resolution. It sounds like a very interesting one and I will have it studied.


John Robert Holmes: In view of the fact the government of Canada is responsible for health programs in the north, and in view of the fact that alcohol is recognized as being related to serious health problems in the north, can the minister indicate how the government can justify a cost of over $2 a quart for milk in many communities in the north and yet a bottle of beer can be purchased for less than 50 cents because of government subsidization? Also, will the minister take action to correct that deplorable situation.


William Warren Allmand: Mr. Speaker, it does sound deplorable and I would not want to justify it. I will see what we can do about it.

[Translation)


INDUSTRY
Mr. Roch La Salle (Joliette):: Mr. Speaker, I have a question for the Minister of Industry, Trade and Commerce.
In view of the tremendous hardships experienced by the Canadian footwear industry and the fact that an inquiry pointed to imports as one of the major causes of plant shutdowns, since the Anti-Dumping Tribunal is to submit a final report on that matter by September 15 next, and in view of the strong possibility that 1,500 to 2,000 workers will be laid off by the end of July, would the minister be prepared to restrict imports immediately pending the recommendations of the report expected next September?


Joseph Jacques Jean Chrétien: Mr. Speaker, I am extremely concerned about the developments in the footwear industry in Canada. Of course, I am subject to the existing laws of Parliament which restrict my activities. The Anti-Dumping Tribunal is now reviewing the situation in order to determine whether this situation is due to a fair or unfair competition. I asked my officials to conduct a more specific study in order to ascertain if interim restrictions might not be warranted, but I have received no final report as yet regarding that possibility.


Roch La Salle: Mr. Speaker, I should like to put a supplementary.
In view of the fact that, following its meeting, the Canadian Manufacturers Association made a recommendation to the effect that the department should earmark 60 per cent of the home market for Canadian production, would the minister indicate whether he is prepared to support this recommendation or goal of the Canadian Manufacturers Association so that at least 60 per cent of all products consumed in Canada are manufactured in this country?


Joseph Jacques Jean Chrétien: Well, Mr. Speaker, we are presently considering several possibilities, but before asking the Anti-Dumping Commission to investigate the matter, I had discussions on a number of occasions with the Canadian footwear industry and they seem to agree with our decision to ask the Commission to report on this matter as soon as possible and I am keeping a very close look on further developments in this respect. The hon. member's intentions are of course quite commendable, as long as we are sure that the Canadian public will not have to pay too high a price for these protective measures.


NORTHERN AFFAIRS
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I have a question for the Minister of Indian Affairs and Northern Development. It arises out of a news report in the Globe and Mail. It appears that after seven long years the government is now prepared to table in this House the rules and regulations concerning oil and gas exploration and development in the north. Will the minister advise whether we will receive that before the end of this session? Also, has he consulted with not only Petro-Can officials but other corporations involved in oil and gas exploration, particularly in the Calgary area?


William Warren Allmand: Mr. Speaker, certain interim regulations will be tabled by the Minister of Energy, Mines and Resources. Consultations have taken place. Perhaps more details can be given by that minister.


Eldon Mattison Woolliams: Mr. Speaker, many on this side of the House have been pressing to find out when these will be tabled. We have been promised this for seven long years. Can the minister state a time limit as to when this will be tabled in the House?


Alastair William Gillespie: Mr. Speaker, we are still working toward being able to provide them in this session. I cannot be sure we will be able to do so. Anything in the form of new legislation may have to await the next session. Because of that situation, we have been working on a contingency plan. I hope to be able to announce the details of that contingency plan early next week.


ELECTION EXPENSES ACT
Mr. W. C. Scott (Victoria-Haliburton):: Mr. Speaker, my question is for the government House leader. When does the government House leader expect to introduce into the House
June 17, 1977

an amendment to the legislation affecting the Election Expenses Act?


Hon. Allan J. MacEachen (President of the Privy Council):: Mr. Speaker, I understand the hon. member is asking about the Election Expenses Act. I have a draft bill waiting in the wings. Any time the parties of the House are ready to pass it, I will bring it in. 1 understand the contents have been agreed to by an all-party committee in order not to cause any difficulties.


William C. Scott: My impression is that cabinet is either making or studying amendments to the Election Expenses Act.


Allan Joseph MacEachen: Mr. Speaker, there are certain amendments that have been recommended by the Chief Electoral Officer. The cabinet on its own has not proposed amendments apart from those that have been proposed by the all-party committee dealing with election expenses, the standing committee and the Chief Electoral Officer.


ANTI-INFLATION PROGRAM REQUEST FOR CLARIFICATION OF REFERENCE TO &quot;A FORUM&quot; IN CONNECTION WITH DISCUSSIONS ON RESTRAINT
John Allen Fraser: Mr. Speaker, my question is for the Minister of Finance. It arises out of comments which the minister made in his contribution to the debate last night. As reported at page 6769 of Hansard the minister referred to future discussions with-and he used the words "a forum". Is the minister referring to the so-called national forum which was advanced and advocated by his colleague the Minister of Labour and which is not yet established but which again is advocated in the green paper; or is the minister referring to some future discussions with the ad hoc group from the business community and representatives from the Canadian Labour Congress? Would the minister just clarify that?


Donald Stovel Macdonald: Mr. Speaker, there will be a meeting, the date of which has not yet been set, with what the hon. member refers to as the ad hoc group, namely the representatives of the Canadian Labour Congress and certain representatives of Canadian business. There will be a meeting within the next several weeks for the purpose of discussing the recommendations of the green paper, the Agenda for Co-Operation. That meeting will take place, I expect, in the near future. One of the purposes of the meeting will be to seek the support of labour and business for the creation of the consultative forum which is referred to at some length in the Agenda for Co-Operation.
Oral Questions


DATE OF ANNOUNCEMENT ON DECONTROL
John Allen Fraser: A supplementary question, Mr. Speaker. Is it the position of the government that as a result of these discussions, which hopefully will take place in a couple of weeks, agreement in principle will be achieved as to the government's proposal for decontrol, and that the government will then-and that means a few weeks from now-clarify the situation so far as its own policy is concerned; or do we have to wait for the establishment of a national forum before the government is going to be able to make up its mind as to the form of decontrol and the date of decontrol?


Donald Stovel Macdonald: Mr. Speaker, the answer would be no. I would expect to be able to indicate to the House, if it is sitting, and the country some time in July the timing and method of decontrol.


POST OFFICE
Hon. W. G. Dinsdale (Brandon-Souris):: Mr. Speaker, my question is for the Postmaster General, who will be aware of the relocation of the Calgary plant outside the city limits of Calgary some three years ago, a move which required a subsidy to provide bus service for the employees. Is the Postmaster General aware that Treasury Board is refusing to renew that subsidy after June 30, thereby reducing this bus service for evening and weekend shift workers and creating undue hardships which will further lower employee morale and affect the efficient operation of this plant?


Hon.   J.-J. Blais@Postmaster General: Mr. Speaker, I was not aware of that refusal. I will look at the information which the hon. gentleman has provided, and I take it that his question is in the nature of a representation which I will take very seriously indeed.


Walter Gilbert Dinsdale: A supplementary question, Mr. Speaker. Would the minister meet with his colleague, the President of the Treasury Board, to try to get some uniformity of policy in this regard? It is these niggling little issues which have such a devastating effect on the morale of the postal employees.


Mr. Blais:: Mr. Speaker, the hon. gentleman is aware that during the mediation over the Christmas period which received wide publicity the question of relocation was brought in issue by the union. It is one that they wanted to have referred over for negotiations, which hopefully will be renewed in the near future if CUPW wants to come back to the negotiating table, and undoubtedly the decision of Treasury Board was involved in the context of having to negotiate relocation and any compensation therefor.
6790

June 17, 1977
Oral Questions


FUGITIVE OFFENDERS ACT
Mr. Ray Hnatyshyn (Saskatoon-Biggar):: Mr. Speaker, my question is for the Minister of Justice and it relates to statements which the minister made in recent days in which he has made much of the fact that, rather than a national inquiry, the fight against organized crime depended upon passing government legislation. Since improved legislation seems to be the minister's answer to organized crime, I should like to ask the minister why he has not seen fit during his tenure to introduce amendments to the Fugitive Offenders Act, which deals with extradition in Commonwealth countries, since loopholes in the current legislation have in fact enabled one of the so-called Five dragons, namely Mr. Hon Kwing Shum, to avoid extradition to this point, as will the others who are found in Canada, if they are?


Hon. Ron Basford (Minister of Justice):: Mr. Speaker, we have been working with other Commonwealth countries on the development of a new Fugitives Offenders Act. The drafting is well advanced and I would hope that it would be part of the legislative program for the next session.


Ramon John Hnatyshyn: A supplementary question, Mr. Speaker. The minister knows that the United Kingdom has had this act in place since 1948. The Fugitive Offenders Act was enacted in 1880. The Commonwealth law conference, in fact, dealt with this matter in 1966 and Canada is the only exception. Can the minister let the House know how he is going to maintain his credibility when he permits legislation to remain without amendment which allows individuals to avoid charges and escape justice, while claiming that organized crime can be fought by amending legislation? The minister stands indicted by his own words.


INDIAN AFFAIRS
[Stage Direction]
DEMANDS OF MfeTIS AND NON-STATUS INDIANS OF MANITOBA FOR SETTLEMENT OF LAND CLAIMS-GOVERNMENT POSITION
Mr. Jack Murta (Lisgar):: Mr. Speaker, 1 should like to direct my question to the minister of Indian affairs. Since Manitoba's 100,000 Metis, non-status Indians and other groups have asked the federal government for an incredible $1 billion to settle their land claims and get recognition of their aboriginal rights, has the minister responded to what must be an outrageous request, and what has his reply been to the Manitoba group?


William Warren Allmand: Mr. Speaker, I am not responsible for Metis and non-status Indians. Their relationship with the federal government is through a joint committee composed of cabinet and the Native Council of Canada, of which the President of the Privy Council is chairman and is their direct contact with the government. Although I am a member of that

committee, the President of the Privy Council is the minister responsible for direct relations with them.


CONSUMER AFFAIRS
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, my question is for the Minister of Consumer and Corporate Affairs and deals with food strategy. Since the Department of Agriculture has stated that we lose about 250 acres of good food growing land every day which cannot be recovered, and that our food deficit if you exclude food grains and oil seeds was about $1.9 billion last year, can the minister tell the House what legislation we can soon expect to preserve food lands for the production of food and increase self-sufficiency in food in Canada?


Anthony Chisholm Abbott: Mr. Speaker, as the hon. member will appreciate, food strategy involves the responsibility of several departments and ministers, and his question certainly has no relevance to my responsibilities.


ANTI-INFLATION PROGRAM CONSTITUTIONAL BASIS FOR POST-CONTROL LEGISLATION
Mr. G. W. Baldwin (Peace River):: Mr. Speaker, I have a question for the Minister of Finance. In view of the fact that the elimination of controls involves an admission that an emergency no longer exists, which formed the basis for the Supreme Court decision, has the minister given consideration to the constitutional position on which some post-controls legislative sanctions would be based in the period following the ending of controls? What would be the constitutional basis for continuing some form of post-controls intervention in the economy?


Donald Stovel Macdonald: Yes, Mr. Speaker, that question has been considered and I would have to acknowledge that it is one of difficulty. The legislative change which I referred to in my statement last evening related to amendment of contracts which are already in existence for the period covered by the controls. Probably I should hesitate to advance a legal opinion to the House, but I think that the hon. gentleman would agree with me that, following the termination of the controls program, it would be very difficult to have any comprehensive legislation. I think that by then possibly the House would have lost the jurisdiction which has been recognized by the Supreme Court.
June 17, 1977


EXTERNAL AFFAIRS
Mr. J. P. Nowlan (Annapolis Valley):: Mr. Speaker, my question is directed to the Prime Minister and it follows the first question by my leader today about the Commonwealth Conference. 1 should like to ask the Prime Minister if he intends to take any initiatives on the Ugandan situation, and specifically, has he given any instructions to our ambassador in New York and the United Nations to see if that ambassador can develop the consensus about the Ugandan situation so that there will be a situation on economic sanctions against Uganda, comparable to the Rhodesian situation? Does the Prime Minister think he has discharged his commitment to human rights by making a statement in one case with other Commonwealth leaders and yet has taken action in the other case?


Pierre Elliott Trudeau: Mr. Speaker, I must point out to the hon. member that if we were to get any support for the sanctions against Uganda he must realize that we have to have sanctions against South Africa also. This may not be possible to obtain from the present membership of the Security Council. He cannot reasonably argue that there should be sanctions against Uganda for one form of violation of human rights and not against South Africa which we have consistently condemned as being in very severe breach of human rights.


Charles Joseph Clark: What instructions are you giving the
ambassador?


John Patrick (Pat) Nowlan: Mr. Speaker, my supplementary is very short and simple. With all the problems connected with trying to develop a consensus for sanctions at any time and since as the Prime Minister said, it only happened once in the United Nations, is the Prime Minister going to take any initiatives in this field?


Pierre Elliott Trudeau: Mr. Speaker, the hon. member should realize that when the question of sanctions against South Africa was raised, Canada said that it did not want to go that far. 1 will discuss it with the Secretary of State for External Affairs, but my first answer would be that we would not want to behave differently for Uganda than we have for South Africa.


Ramon John Hnatyshyn: I hear that J.-P. Goyer thinks you should not.
Royal Canadian Mounted Police



ROUTINE PROCEEDINGS


Hon. Francis Fox (Solicitor General):: Mr. Speaker, I shall now make a statement on all circumstances regarding and surrounding the matter popularly known as the APLQ affair in Montreal, as requested by members of the House. 1 shall try to the best of my knowledge and ability to state all related facts.
As we all know, Mr. Speaker, the court proceedings initiated by the Minister of Justice of Quebec, after the illegal search of the premises occupied by l'Agence de Presse Libre du Quebec, le Mouvement pour la defense des prisonniers politiques du Quebec and la Cooperative des demenageurs du 1" mai, in October 1972, have now been completed. This illegal search has raised a number of questions in the minds of many people. Questions have been asked, particularly in the House, as to whether the Solicitor General of the time had approved of the search prior to its taking place and, if not, at what point in time this search was brought to his attention or that of his successor and whether appropriate action was taken at that time. Many questions also have been raised about the role of the RCMP Security Service in this matter and about its methods of operation. These questions are legitimate and require clear answers. This is what I propose to do today.
First of all, Mr. Speaker, I cannot stress too highly that in a democratic society like ours, the rule of law is and must be paramount. It is the vital force without which our basic liberties run the risk of becoming empty slogans. No threat to such liberties can justify, in any way, and even with the best of intentions, the use of illegal means to protect these basic rights. Clearly, there can be no compromise in this regard; it is upon this premise that the integrity and survival of our democratic institutions and our fundamental liberties are based. If the law is not adequate to handle such dangers as threaten our liberties and our institutions, then the answer does not lie in breaking the law, but rather in changing it.

During the night of October 6-7, 1972, police officers of the Royal Canadian Mounted Police, acting together with officers of the Surete du Quebec and la Police de Montreal, carried out a search of the premises occupied by L'Agence de Presse libre du Quebec, le Mouvement pour la defense des prisonniers politiques du Quebec and la Co-operative des Demenageurs du lcr mai. Documents were seized on the premises. The carrying out of this search had not received prior authorization by the court and, therefore, was illegal.
On May 26 of this year, the three officers of the RCMP, Surete du Quebec and la Police de Montreal, respectively, who had authorized this operation, entered a plea of guilty to a charge brought against them under section 115 of the Criminal Code by the authorities of the province of Quebec for

June 17, 1977
Royal Canadian Mounted Police
having neglected to obtain a search warrant in connection with the incident that took place on October 6-7, 1972. The police offiers were yesterday granted an absolute discharge by the court.
Neither the RCMP headquarters in Ottawa, nor the commanding officer of C Division in Montreal, nor the solicitor general at the time, the present Minister of Supply and Services (Mr. Goyer), had been told of the search and seizure of documents on the premises occupied by the APLQ prior to the operation being carried out.


Eldon Mattison Woolliams: That sounds like Nixon.


Francis Fox: I do not think Nixon made any statements in the House like we are. The conversations which I have had personally with the present Minister of Supply and Services, the then commissioner of the RCMP, Mr. W. L. Higgitt, and the then director general of the security service, Mr. John Starnes, and the examination of relevant files clearly support these facts. It was only on October 10, 1972, four days later, that C Division of the RCMP in Montreal informed the RCMP headquarters in Ottawa of the search and seizure on the premises of the APLQ.
Following the search and seizure of the documents, the groups affected by these events sent telegrams or letters to a number of people. Thus, on Monday, October 9, 1972, only a few hours after the incident, the APLQ sent a telegram to the assistant commissioner of the RCMP in Montreal, to the director of la Police de Montreal and to the director of the Surete du Quebec, inquiring if their respective organizations had been responsible for the theft of documents. This telegram asked for an immediate reply. The RCMP did not provide a response to it.
(Translation]
On Monday, October 9, 1972, the three groups which had been the subject of the search and seizure, inquired, through letters sent to the Minister of Justice of Quebec and to the Solicitor General of Canada, if the RCMP, the Surete du Quebec and the Montreal police were involved in the break-in into their premises and the theft of documents. This registered letter, to which was attached a copy of the telegram addressed to the Assistant Commissioner of the RCMP in Montreal, requested that a reply be given before 11 a.m., Friday, October 13, 1972.
On Thursday, October 12, 1972, the Minister of Justice of Quebec, the Hon. Jerome Choquette, stated publicly that he had been informed that none of the three police forces, the RCMP, the Surete du Quebec and the Montreal police, had been involved in the break-in and the theft of documents on the premises occupied by the APLQ during the night of 6/7 October, 1972, adding that the appropriate authorities, namely the Montreal police, were investigating the matter. There is nothing in our files to indicate that the Quebec provincial authorities had communicated with the RCMP in Ottawa, or the Solicitor General of Canada or his office, before Mr. Choquette made his statement.

On Friday, October 13, 1972, spokesmen for the three groups that had written to the Solicitor General of Canada and to the Minister of Justice of Quebec held a press conference, during which they indicated they had come to the conclusion that the theft of documents was the result of a police search under the provincial Law 51. These groups took the opportunity to launch an opposition campaign against Law 51, which granted special powers of search to the police, under the control of the Police Commission of Quebec, in the fight against organized crime, terrorism and subversion.
Concerning the letter sent to the Hon. Jean-Pierre Goyer, it was received in the Ministry of the Solicitor General on October 11, 1972, and brought to the attention of the RCMP by the assistant to the minister, Lieutenant Colonel John R. Cameron, in order that a reply could be prepared for the Solicitor General's signature. This was done without the minister being informed. In referring the letter directly to the RCMP for reply, without bringing it to the minister's personal attention first, Lieutenant Colonel Cameron was following the usual practice in handling such letters, addressed to the Solicitor General of Canada. This practice was meant to enable the RCMP to launch an investigation forthwith even if it meant that the letter of inquiry would be brought to the minister's attention at a later date. In fact, letters are, from time to time, addressed to the Solicitor General enquiring or complaining about the conduct of the RCMP or of one of its members in the performance of their duties as the national police force or as provincial police under arrangements that exist in eight Canadian provinces, hence the need for such a system. On October 26, 1972, the RCMP wrote to the minister's assistant, recommending that no acknowledgement be made, without providing the reason for their recommendation.
The Solicitor General of the time remembers having seen the letter of October 9, 1972, at a later date, and having asked the RCMP why they recommended that there be no acknowledgement. The Solicitor General recalls that the RCMP response to his question was that the theft of documents, about which the APLQ had complained, fell under the jurisdiction of the provincial authorities, more particularly, the Minister of Justice of Quebec, and that the Montreal police was investigating the incident. Moreover, the minister considered it hard to believe that the RCMP would have participated in a theft of documents, as the letter of October 9, 1972, had implied. Accordingly, the Minister of Supply and Services (Mr. Goyer), the former Solicitor General, categorically states that he was not informed that the theft of documents was the result of an unlawful entry in which the RCMP had participated.
The Minister of Supply and Services does not recall the exact date upon which the letter of October 9, 1972, was discussed with the RCMP. It would seem, from the agenda of the minister, that the letter would have been discussed with the RCMP on November 6, 1972, just a few days after the federal general election of October 30, 1972. It is at this point that the minister would personally have seen the letter for the first time.
June 17, 1977

Commissioner Higgitt and Mr. John Starnes also recall having discussed the October 9 letter with the solicitor general on a date they cannot now precisely establish. They state that they do not remember having briefed the solicitor general of the RCMP's participation in the unlawful entry of the APLQ premises. They add that they would be surprised if they had not verbally advised the solicitor general in this regard. The former commissioner and the former director general agree that in most cases information of importance was brought to the minister's attention in writing. Our files and those of the RCMP contain no written report on the unlawful entry to the solicitor general.
The Quebec justice minister's statement of October 12, denying that any of the three police forces were involved in the October 6-7 theft of documents, was obviously not consistent with the facts. The RCMP did not notify the solicitor general of the fact that the Quebec justice minister's statement was erroneous, but left the matter for attention in Quebec, in the knowledge that the police authorities concerned, to wit, la Police de Montreal, had already instituted an investigation into the case. Both the former commissioner and the former director general told me of the good faith that had prompted their decision under the circumstances, convinced that this matter came directly under the police authorities concerned who had instituted an investigation, as they had indicated to the solicitor general.
On November 27, 1972, the hon. member for Dollard (Mr. Goyer) was appointed Minister of Supply and Services and was succeeded by the hon. member for Notre-Dame-de-Grace (Mr. Allmand) as solicitor general. The very first time the October, 1972, break-in was brought to the latter's attention was in March, 1976. Further to disclosures by a former RCMP member, who had actually taken part in the unlawful entry, the solicitor general was notified by the commissioner, Mr. Nadon, and the director general of the security service, Mr. Dare, of the participation of the RCMP in the unlawful entry, for the first time, on March 16, 1976. It was the first time, as well, on that same day, that the deputy solicitor general and the assistant deputy solicitor general (police and security) were made aware of the participation of the RCMP in this operation.
The solicitor general immediately made sure that the Quebec authorities were aware of the matter. In actual fact, he was informed that Quebec had already undertaken an inquiry. The Quebec authorities in particular, on April 30, 1976, during a meeting in Ottawa between the solicitor general of Quebec, the Hon. Fernand Lalonde, and the Hon. Warren Allmand were assured of the complete co-operation of the RCMP in the inquiry which they had undertaken. The commissioner of the RCMP himself met with the representative of the solicitor general of Quebec in August of 1976 and provided him with relevant information. 1 have no reason to think that the co-operation of the RCMP with the Quebec authorities throughout their inquiry was anything but full and complete.
Royal Canadian Mounted Police In the days which followed March 16, 1976, the solicitor general of Canada inquired as to the disciplinary action taken by the RCMP after the October 6-7, 1972, operation. Commissioner Nadon then informed the solicitor general that the former director general of the security service had, at the time of the incident, expressed his dissatisfaction to those responsible for the operation and had reprimanded them. The commissioner added that his predecessor, W. L. Higgitt, had not taken any other disciplinary action.
Commissioner Nadon further specified that, since it seemed apparent that the Quebec authorities would shortly institute court proceedings against those responsible for the incident, it would not be advisable to reopen the question of internal discipline at that time. The officer of the RCMP who entered a plea of guilty on May 26, 1977, to the charge brought against him by the Quebec authorities in relation to the October, 1972, incident was, on that same day, suspended from the force.
The former solicitor general undertook in the days immediately following March 16, 1976, to discuss the matter with the Prime Minister (Mr. Trudeau) who was told for the first time of the RCMP participation in the unlawful entry. The government seriously considered the creation of a royal commission of inquiry at that time. The government received, however, repeated and unequivocal assurances from the RCMP that the APLQ incident was exceptional and isolated and that the directives of the RCMP to its members clearly require that all of their actions take place within the law.
It was essential that justice take its normal course. The creation of a royal commission of inquiry would have risked interference in the normal course of the investigation initiated by Quebec and in the prosecutions which could have resulted from them. The right of a possible accused to a fair and just trial could also have been compromised seriously by the work of such a royal commission. The government decided, therefore, not to establish a royal commission, but remained firmly committed to re-examining the matter once the judicial process had run its normal course.

Mr. Speaker, we all know what events have followed. The investigation by the Quebec police authorities into the matter led to a pre-enquete before a judge; this pre-enquete resulted in the laying of criminal charges against members of the three police forces involved. In addition, the government of Quebec announced yesterday the setting up of a commission of inquiry. This commission of inquiry into the circumstances of the unlawful entry of October 1972 will specifically inquire into four points:
(a)	The closing of the investigation files that had been opened by the Montreal police after the incident;
(b)	The different versions which were given in regard to the unlawful entry;

June 17, 1977
Royal Canadian Mounted Police
(c)	The disposal of the documents that were seized at the time; and
(d)	The cooperation extended by the RCMP, the Surete du Quebec and the Montreal Urban Community police force to the Quebec Department of Justice in the investigation launched after the unlawful operation was made public.
We are assuring Quebec authorities of our cooperation and that of the RCMP in the work of their commission of inquiry, in line with our legal and constitutional responsibilities. Justice is thus following its course. As we have done so far, we intend to continue providing our best cooperation to those responsible for its administration in the province, namely the Quebec Department of Justice. I trust, for my part, that the commission set up by Quebec will shed the light on those aspects of the affair that have been referred to it.
In so far as federal responsibilities are concerned, the information I have given the House today raises a number of questions about the way in which complaints about the conduct of members of the RCMP are handled.
In particular, Mr. Speaker, doubts can arise as to the value of a system of investigating and handling complaints which is exclusively administered by those against who the complaints are made.
On June 6, 1974, the government, on the initiative of my predecessor, set up a commission of inquiry under Judge Rene Marin to review the whole question of citizen complaints against members of the RCMP and the system of discipline within the force. The Marin Commission reported in January of 1976. As I have already indicated to the House, a number of the commission's recommendations, which did not imply legislative change, have already been implemented. In the fall of this year, I intend to present to Parliament a bill which will deal with many of the recommendations of the commission, particularly those which concern the handling of citizen complaints against the RCMP in an objective and independent manner.
The facts, which I have related today, raise other questions concerning the methods of operation of the RCMP and of the Security Service. Some may ask if illegal entry into premises is a normal or even an exceptional procedure of the RCMP. In the event doubts persist, Mr. Speaker, I repeat what 1 said earlier: an illegal entry into any premises, whatever the intention or purpose, is completely unacceptable to me and to the government and is not, under any circumstances, to be tolerated. The commitment to this view is one that is shared by the Commissioner of the RCMP and by the Director General of the Security Service and will be the basis upon which any allegations of illegal conduct, either on the part of members of the RCMP, whether of the Security Service or those involved in regular police activities, will be viewed. Members are aware that this is force policy.

Finally, Mr. Speaker-


Mr. Peters:: I could tell you that from my own experience with the security staff over here.


Francis Fox: The hon. member opposite is very knowledgeable in that area. Finally, the information I have given the House today will have dispelled, I trust, any doubt that might have arisen regarding the conduct of my predecessors in the matter.


Charles Joseph Clark: Not at all. We would like to have him under oath somewhere.


Some hon. Members:: Oh, oh!


An hon. Member:: Where is he-with Idi?


Charles Joseph Clark: You had better keep him in Africa.


An hon. Member:: The "plumbers" would have had a field day up here.


Francis Fox: The judicial process, with the unconditional discharges granted by the court yesterday seems, at least for the time being, to have completed its course. The setting up of a commission of inquiry by Quebec will ensure that all relevant aspects of the affair that have been referred to it are examined in an independent fashion.


An hon. Member:: Just incredible.


Francis Fox: The facts and details which I have provided today explain the circumstances of the affair in so far as federal responsibilities are concerned.


An hon. Member:: No, they don't.


Gerald William Baldwin: Even Idi Amin would not try this.


Francis Fox: The process of handling the complaints of citizens-certainly in 1972-was not adequate. The legislative changes which I propose to bring before parliament in the fall flowing from the recommendations of the Marin report will bring corrective measures to bear on this process as well as on the system of internal discipline. In addition, I trust that my statement today will have dispelled all possible doubt concerning our commitment to ensure that the operations of the RCMP take place within the constraints of the law.


An hon. Member:: You are covering up for Goyer.


Francis Fox: In addition, the commissioner of the RCMP and the director general of the security service fully recognize the need to bring to my attention, clearly and unequivocally, any breach on the part of their members of the clear directives of the RCMP in that regard. Regarding the conduct of the government, its ministers and the RCMP authorities, I trust, Mr. Speaker, that hon. members will agree with me that the information I have provided today answers adequately the questions that could have arisen in connection with this matter.


Charles Joseph Clark: Not at all.


Walter David Baker: You are not very happy with it either, "Foxy".
June 17, 1977


Francis Fox: In a democratic society, Mr. Speaker, it is essential that those on whom, like the RCMP and the Security Service falls the task of enforcing the law and protecting our basic liberties, can count upon the complete support of the people. This support, in return, must be based on the faith that those protecting these rights do themselves feel bound and indeed are bound by our laws in fulfilling their duties.
The RCMP and the Security Service are doing their best in the discharge of responsibilities that rapid social and other changes, both internally and externally, have made increasingly more complex. I dare say that their record thus far ranks as one of the best, both in this country and outside. Obviously, mistakes can be made and indeed are made. The determination of the government and the top management of the RCMP-which I cannot over-emphasize-to deal with these mistakes whenever they arise, with force and vigour, but also with fairness, will ensure, I trust, that despite these mistakes, Canadians will continue to provide the members of our national police force with the respect and support they need in their difficult tasks. Mr. Speaker, I had promised to give facts to the House in answer to the many questions raised these last few weeks and I think my statement fulfilled that commitment towards the House.


Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, on behalf of our party I should like to say to the Solicitor General (Mr. Fox) that obviously his very carefully detailed statement contains some good news and some bad news. The good news is that there is a recognition that there have been some serious deficiencies in the way certain aspects of RCMP and ministerial staff work have been carried on. The bad news is that the statement really raises more questions than it answers. In that regard, it would have been helpful if we in the opposition had had a bit more notice of this long and carefully detailed statement. However, without being unfair, in a sense it is characteristic of the way this whole affair has been handled- maximum non-disclosure up to the last minute.


Some hon. Members:: Shame.


Elmer MacIntosh MacKay: There is one thing which is very clear, and that is that a great many people do not remember an awful lot of details. These are interesting people. They include the former commissioner, Commissioner Higgitt, John Starnes, and the present Minister of Supply and Services (Mr. Goyer).
There are very many circumstances which are very contradictory on their face. For example, it is stated on page 5 of the minister's statement that there is no written report on the unlawful entry to the solicitor general on file, yet on May 18, 1976, the then solicitor general told the hon. member for Maisonneuve-Rosemont (Mr. Joyal) that he had a complete report from the RCMP in his hands. This report has never been tabled. It would be helpful if it were tabled.


Some hon. Members:: Hear, hear!
Royal Canadian Mounted Police


Elmer MacIntosh MacKay: The Quebec minister of justice has been accused in the minister's statement of saying things which were obviously not consistent with the facts.


Mr. Stanfield:: He is expendable.


Elmer MacIntosh MacKay: Apparently he is, but I believe he deserves an opportunity to say something in this regard. I am going to come to that in a little while. There are many contradictions, but of particular concern to me, as someone who is reasonably skeptical-but, I hope, not unfairly so-is the role of Inspector Cobb when he was in the then solicitor general's office. As I understand it, his role and the role of officers like him was to provide some sort of facilitation and communication of important matters of concern to the government and to the RCMP. Here was a man, who has now pleaded guilty for his activities in this very incident, working with the then solicitor general in his own office shortly thereafter, yet apparently there was no communication. That, to me, is incredible. There are many things which simply cry out for explanation, and it is hard to know where to start with this particular statement.
If this matter were not so serious, it could be considered a tragic comedy of errors. The then solicitor general, who is now the Minister of Indian Affairs and Northern Development (Mr. Allmand) and who was under some pressure in this House, claimed that it was in March of 1976, I believe, that this matter was first brought to his attention. The matter was investigated with some vigour after that. Yet I had to report to him in the House some weeks later that there was a man investigating the matter, the man who has now pleaded guilty to burglary. Is that not a very strange set of circumstances? I said at the time that it was a startling departure from investigating techniques. The old adage that you should use a thief to catch a thief must have been used. In any event, this matter is not funny: it is a serious matter, because if handled badly it could impugn one institution which many Canadians regard as their absolute guarantee of law enforcement and integrity, namely, the RCMP.


Some hon. Members:: Hear, hear!


Elmer MacIntosh MacKay: This whole matter brings back memories of a rather incredible committee meeting held on Monday, March 17, 1975, when the present Minister of Supply and Services and the present Minister of Indian Affairs and Northern Development, two former solicitors general, flanked by the commissioner of the RCMP, attempted to resolve some very interesting contradictions involving the knowledge of the former solicitor general, now the Minister of Supply and Services, with regard to the Hamilton harbour matter.
This whole thing brings back memories of that matter and raises questions about apparent lack of efficiency, lack of communication and lack of guidance and direction given by ministers responsible for the RCMP. The whole matter is just beyond belief-and here we go again. Five years after a complaint involving a break-in at the premises of a Montreal news agency, the House of Commons Finally receives an accounting from our current Solicitor General after a game of

June 17, 1977
Royal Canadian Mounted Police musical chairs which has gone on in the meantime. I think all of us in this House do not hold our colleague, the present Solicitor General, responsible for this. In fact, I would like to go on record as commending the Solicitor General for the way he has discharged the responsibilities of his portfolio.


Some hon. Members:: Hear, hear!


Elmer MacIntosh MacKay: Any remarks I make about the office should not be taken personally by him. But I do want to say to him that he knows as well as I do that this is a shocking example of lack of acccountability and efficiency on the part of his predecessors to hold out to the people of Canada.


Some hon. Members:: Hear, hear!


Elmer MacIntosh MacKay: The matter has attracted a tremendous amount of attention simply because of this government's failure and obvious reluctance to deal with it as it should have been dealt with in the beginning. Anyone who has perused the questions in Hansard over the last year cannot help but see that this matter has been bungled; and there is no way that the government, despite its carefully contrived statement, can convince hon. members of this House or the public of Canada otherwise.


Eldon Mattison Woolliams: No wonder Goyer is in Africa.


Elmer MacIntosh MacKay: How can we, as members of the House of Commons, accept an explanation as being reasonable when a solicitor general takes the word of those against whom a complaint was made without checking with the complainant? This was a matter of public knowledge. Telegrams were sent. We now know when the former solicitor general received notice. It was even published by the news agency whose premises were burglarized. That is another thing which should be on the record. If those officers had gone into that news agency without a search warrant and had carried out an illegal search, that would have been operating without a search warrant. However, the way it was done was nothing less than break and entry. It was not simply operating without a search warrant.
Another unfortunate thing and another reason we must have an inquiry is that the explanations given by the Solicitor General, despite the fact that he is a minister of the Crown and we accept his word on these things without reservation, are really hearsay evidence, and the best evidence has got to come from the incumbent of the office at the time.


Some hon. Members:: Hear, hear!


Elmer MacIntosh MacKay: Another matter which is worrisome is the obvious disposition of this government, through its solicitors general, to have left not only the primary responsibility but almost the entire responsibility in the hands of Quebec authorities. The government has constantly refused to allow a series of solicitors general to take their responsibilities to the RCMP and to the House of Commons seriously, proposing instead to leave it to the authorities in Quebec. What has the government received for its disposition to do this? The minister

had to admit yesterday that he had absolutely no dialogue, no notice and no consultations with his Quebec counterparts as to the fact that they were going to call an inquiry. I think that, again, indicates the need for the Solicitor General and for the government to exercise their responsibility in this matter.
I do not want to go on at length because I realize that the leader of the New Democratic Party wishes to reply, and also that someone from the Creditiste party does as well. However, it is obvious that an inquiry should have been ordered when the then solicitor general, now the Minister of Indian Affairs and Northern Development, found out about this RCMP involvement and about all the circumstances surrounding this illegal break-in. Such an inquiry at the federal level is now absolutely essential, because only such an objective inquiry with terms of reference enabling it to pursue the chain of evidence in the solicitor general's office-not to smear the RCMP-can find out exactly who is responsible for this.


Some hon. Members:: Hear, hear!


Elmer MacIntosh MacKay: Only such an inquiry can properly uncover that type of evidence which the public and the members of the House of Commons could be asked to accept as the absolute truth. And we must have nothing less than the absolute truth.


Some hon. Members:: Hear, hear!


Elmer MacIntosh MacKay: With the distinguished attorney general from the United States in this House, this would be a good time for the Solicitor General to take the kind of extraordinary initiative which our friends in America took to uncover and to rectify a far more serious situation, but a situation which had some of the elements of what we are seeing here today. Mr. Speaker, I am going to conclude with a quotation that I think sums this matter up. In 1831, Dr. Wolfred Nelson, a political associate of Papineau, said:
The laws must be observed as much by those who govern as by those who are governed.
I think this is the proper note on which to leave this matter, Mr. Speaker.


John Edward Broadbent: Mr. Speaker, the questions we are dealing with in the House today are among the most serious that any democratic legislative body can confront at any time. What is at stake in this issue, and what has not been adequately dealt with in the minister's statement, are the following: Do we, or do we not, in Canada act according to the principle of the rule of law? Do we have a situation in Canada in which the national police force, the RCMP, are actively involved in making policy decisions, deciding on their own what is, or is not, in the public interest? Finally, do we have a case of at least one minister who has not only been involved in serious bungling of his responsibilities but quite clearly, from the statement made today, was possibly involved in lying as well. I want to deal with all these mat ers in the most serious way, Mr. Speaker.
June 17, 1977

What do we know of the facts that have been brought forward today in the minister's statement? We know that an illegal break-in took place in Montreal on October 6, and that the Montreal detachment of the RCMP was informed on October 9. The RCMP headquarters in Ottawa was informed on October 10. We know that a registered letter outlining the matter was received by the former solicitor general on October 11 which had been sent prior to that. We know that on the following day, October 12, the former minister of justice for the province of Quebec issued a categorical denial of police involvement in this break-in. Finally, we know that the RCMP, in an incredible letter to the former solicitor general dated October 26, said that no acknowledgement should be made to a registered letter which had been sent to him outlining the break-in that had taken place early that month. As far as I can determine, those are all the facts that were asserted and that we can claim to know in this situation.
In dealing with this issue this morning, I want to comment on two aspects only: the role of the RCMP and the questions that have been raised not only about its administrative competence in this matter but, more basically, whether or not it consciously adheres to the principle of the rule of law itself. I want also to deal with the performance of the former solicitor general. 1 regret that we did not have more time to peruse the statement, Mr. Speaker. As the hon. member for Central Nova (Mr. MacKay) has indicated, we did not receive copies until halfway through the question period.


An hon. Member:: The press gallery got it.


John Edward Broadbent: The matter is very complex and there are obviously many other questions that can be raised and which I am sure will be brought to the attention of the minister at another time. I want to turn immediately to the Royal Canadian Mounted Police. In my view, the RCMP have behaved badly. They did not inform the minister, to whom they were responsible, of illegal activity.


Ramon John Hnatyshyn: That is what the minister says. You are not sure about that.


John Edward Broadbent: Well, that is my judgment from what the Solicitor General (Mr. Fox) tells us. It may turn out not to be the case, but on the face of the evidence so far I am prepared to accept it. In addressing the matter of a response to the letter that arrived in the minister's office on October 11 outlining the break-in, they recommended that the minister should not even acknowledge the receipt of a letter which, if accurate, points out that the RCMP was involved in a clear and unequivocal violation of the law. According to the statement of the Solicitor General today, this matter was not brought to the attention of the then minister until October 26, and then only indirectly by a letter to an assistant in his office. It was brought to his attention about two weeks after the national headquarters of the RCMP in Ottawa knew all about it. They did not recommend that the minister investigate more thoroughly or take some other specific action, but recommended that he not even
Royal Canadian Mounted Police acknowledge receipt of the letter sent to him by the group in Montreal which was affected.
We are told that the matter was finally discussed-and this is a very intriguing point-perhaps on November 6. 1 find it strange that neither the then solicitor general nor the RCMP can confirm the date of such an important meeting. Mr. Goyer apparently indicates that the meeting probably took place on that date, and in his statement today the Solicitor General, if I recall correctly, indicated that the RCMP have no precise date for the meeting. We are told that Commissioner Higgitt does not even recall briefing the then solicitor general on the RCMP involvement in the break-in, but the statement of the Solicitor General today points out that Commissioner Higgitt said he would be "surprised if they had not verbally advised" the then minister of what had taken place. I will come back to that in a minute, Mr. Speaker.
Concerning the lie of the former minister of justice of Quebec, Mr. Choquette-that is what it was, when he denied involvement on October 12 more correctly-it might not be a lie, because he may not have been informed by October 12, but it was an incredible statement to make October 12 if he had not got the necessary information from the police forces involved. But at least, concerning that public denial of police involvement by Mr. Choquette on October 12, according to the minister's statement today, the RCMP, by their own admission, did not even inform the then solicitor general at the time of the November 6 meeting of the events that took place in the break-in. If that is accurate, I think it is a shocking illustration of irresponsibility.
This is truly incredible, Mr. Speaker. At the time of the meeting with the then minister, the RCMP headquarters knew of their own involvement. They knew at that time of Mr. Choquette's statement, and they knew at that time that it was false. Surely, they ought to have said something to the minister. Surely, in terms of their responsibility to a minister of the Crown in the government, they ought to have told the then solicitor general that what Mr. Choquette had told the people of Canada was false, and that the RCMP as well as other police forces had been involved in the illegal break-in.
I have no reason to question the integrity of the present minister. On the whole, up to this point he has behaved admirably, with commendable frankness. Therefore, what he has told us today clearly constitutes, if it is accurate as he thinks it is, a shocking indictment of senior representatives of the RCMP in terms of their responsibility to the minister.
Now I shift my attention to the former solicitor general. The present Solicitor General tells us that Mr. Goyer "appears" to have discussed the October 9 registered letter for the first time on November 6. I repeat, in this context, that I personally find it surprising and disturbing that there was not an accurate record kept in the minister's office of such a clearly important meeting which took place to discuss the possibility of a clear violation of the Criminal Code by the RCMP. Apparently no precise record was kept, according to Mr. Goyer's information

June 17, 1977
Royal Canadian Mounted Police as he provided it to the present minister. The Solicitor General now tells us Mr. Goyer says he was not informed of the break-in by the RCMP at the meeting which took place on November 6. The RCMP, about the same meeting stated that they would be "surprised" if they had not told the minister, at least verbally, about the RCMP's involvement.
All this suggests to me some obvious questions. Having had the October 9 letter brought to his attention, what did Mr. Goyer ask the RCMP at that November 6 meeting? Did he ask explicitly about RCMP involvement in the raid? Did he put the question directly? This is not cleared up in the present minister's statement. Surely, Mr. Speaker, it was his basic obligation to put that question to senior representatives of the RCMP. I, for one, cannot believe the question was not put. And if the answer to the question was in the affirmative, Mr. Goyer should have taken immediate action. If, however, there was a denial, then, to put it bluntly, the RCMP lied because we have it on record that the RCMP in Ottawa by this time clearly knew of their own policemen's involvement. We must learn the precise nature of this conversation, this important meeting which took place between Mr. Goyer and senior representatives of the RCMP. That is elementary.
At that meeting, in discussing the October 26 letter to his assistant recommending that no acknowledgement should be made, surely Mr. Goyer must have asked explicitly about RCMP involvement. I repeat, I cannot conceive of a conversation between two normally intelligent men on such a serious matter in which such a question would not be raised. The conclusion which follows my basic assumption that this question must have been put is as follows: either he was lied to by the RCMP, or he is lying in his report to the minister about what the RCMP told him. Or the third possibility is that Mr. Goyer is so incompetent and so foolish as not to have asked this elementary question-


Robert Lorne Stanfield: What about a selective memory?


John Edward Broadbent: -and I, for one, simply cannot believe that. As to the question of responsibility to the minister, bungling and the possible involvement of dishonesty, and the question of the RCMP's violation of the principle of the rule of law, a violation clearly demonstrated by its failure to inform the minister of illegal acts taken by representatives of the force in the city of Montreal, I say the force has demonstrated clear irresponsibility in terms of its past traditions in this country. This question must surely be in the minds of Canadians and in the minds of members of this House: Is this an isolated incident involving the RCMP?


An hon. Member:: No.


John Edward Broadbent: Is it?


An hon. Member:: No.


John Edward Broadbent: Surely, we need more information about the Praxis break-in in Toronto. We have had questions raised about inappropriate activity possibly involving the RCMP in New Brunswick, Alberta, Toronto and Montreal.


Elmer MacIntosh MacKay: And Nova Scotia.


John Edward Broadbent: Surely, Mr. Speaker, in order to get to the root of this matter, to get to the root of the RCMP's responsibility, to determine if they were exercising their responsibility and whether the former solicitor general was simply incompetent or dishonest, we need a comprehensive public inquiry.
[ Translation]


Mr. Leonel Beaudoin (Richmond):: Mr. Speaker, I shall be very brief in reply to those disclosures made today by the Solicitor General (Mr. Fox) whom I want to congratulate on his courage, his explanations and his statement this afternoon which was quite long and rather thorough. Along with my party, I do not agree that the former Quebec Minister of Justice (Mr. Choquette) answered that neither of the three police forces had been involved whatsoever in such an illegal matter. I think that the former Solicitor General should surely have done something or he should have known there was something fishy going on when, on October 26, 1972, it was suggested to his assistant by the RCMP that no acknowledgement be made, as reported on page 4. I therefore think that the minister-


Mr. Speaker:: Order. I wonder if the hon. member for Richmond (Mr. Beaudoin) could indicate now if he needs five or ten minutes more, because I am sure it would be possible to go on until 1.05 or 1.10 p.m. to hear him through. Then, we could call it one o'clock and return at 2.10 p.m. to begin with the questions to be put to the Solicitor General. The hon. member for Richmond (Mr. Beaudoin).


Léonel Beaudoin: Mr. Speaker, would it be possible to ask for the unanimous consent of the House in order to proceed until 1.30 p.m. with this discussion and then come back at 2.30 p.m. after lunch?


Walter David Baker: Mr. Speaker, I rise on a point of order. I gather from what the hon. member is saying that he intends to take an additional half hour to reply. Frankly, I think that is a little long. I say that with respect. If he could cut it down to 1.15 p.m. I would certainly have no objection to carrying on that way. In any event, because of the staff, and for a number of other reasons, if it is the intention of the House to proceed beyond one o'clock we ought not to come back any earlier than an hour after we adjourn. I hope that will be agreeable to our colleagues. Thereafter we could carry on with the question period.


Some hon. Members:: One o'clock.


Mr. Speaker:: It would require unanimous consent to change the arrangement. Therefore, it being one o'clock, I do now leave the chair until two o'clock to hear the balance of the hon. member's statement.
At 1.03 p.m. the House took recess.
June 17, 1977



COMMONS DEBATES AFTER RECESS

[Stage Direction]
The House resumed at 2 p.m.
["Order, please. It being five o'clock, this House stands adjourned until Monday, June 20, 1977, at 11 o'clock a.m.\nAt 5 p.m. the House adjourned, without question put, pursuant to Standing Order.\n8001 8-30 Vi", 'Monday, June 20, 1977']
Mr. Speaker:: Order. At one o'clock the hon. member for Richmond (Mr. Beaudoin) was speaking. However, we missed during the calling of committee reports the hon. member for Gloucester (Mr. Breau) who I believe has a committee report to table. Perhaps we could1 revert, with the consent of the House, to the tabling of reports.


Some hon. Members:: Agreed.



[Stage Direction]
Ninth and tenth reports of Standing Committee on Finance, Trade and Economic Affairs-Mr. Breau (on behalf of the chairman).
[Editor's Note: For text of above reports, see today's Votes and Proceedings.]

Léonel Beaudoin: Mr. Speaker, before lunch I had started a few remarks which I now continue. I wish to remind the House that in his statement on this whole matter, the Solicitor General (Mr. Fox) has shown a lot of courage; nevertheless I still suggest that he has not entirely satisfied our hunger to know all there is to know about the case of the APLQ. Our main concern, and a very serious one, has to do with the rule of law which must remain supreme. I recall that a couple of weeks ago I was greatly disturbed about this rule as it is applied in our penitentiaries. I trust the recommendations made to the Canadian Penitentiary Service will be applied de facto to the RCMP. The Solicitor General no doubt recognizes that the RCMP behaved in a very curious manner to say the least. First Division "C" of Montreal moved into action without informing anybody until four days later, when it did inform Ottawa. By this time, the matter was publicly known, telegrams asking for replies had been sent to the Montreal division which was waiting, nobody knows why, to inform Ottawa about this whole matter.
I sincerely believe the Royal Canadian Mounted Police failed in one of its great responsibilities toward the Solicitor General of Canada. Moreover, the then solicitor general was informed of the whole matter only on October 30, that is three weeks after the documents were stolen. The allegation made in the document that was handed to us also troubles me. I am talking about the allegation that the right hon. Prime Minister (Mr. Trudeau) apparently received from the RCMP clear and repeated assurances that this matter was exceptional and
Royal Canadian Mounted Police isolated. Normally, I think we would take the word of the RCMP without a blink. However, following all this, I am wondering if I should not change a little my judgment on that police force, if such actions could remain hidden and confused for years, I repeat for years, for we are in 1977 and this matter goes back to 1972, and if such things can come to the surface afterwards, following the somewhat forced testimony of a former RCMP agent.
Mr. Speaker, I really wonder now whether other RCMP officials would not have some evidence to give about other cases which took place a few months or a few years ago. 1 am sure this would be of considerable interest to members of the House, in particular the Solicitor General (Mr. Fox). This whole matter casts a serious doubt on this police force and on communications between the various divisions of the RCMP and the Solicitor General, and this is very unfortunate, I suggest.
To conclude, Mr. Speaker, I wish to make a brief comment about the legal and constitutional framework of the investigation under way. If the RCMP intervene in Quebec as they have done on that occasion, they should at the present time, I suggest, participate actively and fully in the investigation in conjunction with the Quebec Justice Department. Therefore, members of this House would be more aware of this whole matter and the federal police force would have the opportunity to know every new development which occurs in this case.
I look forward to the legislation which will be introduced next fall to correct shortcomings in the law as a result of citizens' complaints. Mr. Speaker, I therefore urge the Solicitor General to consider carefully the consultation and communication formula between the various divisions of the RCMP, and between the Solicitor General, hence Parliament, and this police force. The RCMP have always been very respected by all Canadians and it would be unfortunate for this situation to change and for actions such as those we have just dealt to be accepted in any way.


Charles Joseph Clark: Mr. Speaker, there are a couple of questions which I would like to direct to the Solicitor General, just to start. I am sure other of my colleagues will have questions. One of my questions relates to the rather curious reference on page 5 of the English language version of the statement, which indicates that the then commissioner and the then director general said they would be surprised if they had not verbally advised the solicitor general, now the Minister of Supply and Services, regarding the contents of the October 9 letter and all matters relating thereto. There is another degree of vagueness in that the Minister of Supply and Services does not recall the exact date upon which he became apprised of all the circumstances.
I should like to ask the Solicitor General what procedures he followed to ascertain this information from his predecessor, the Minister of Supply and Services, from the former commissioner of the RCMP and the director general. Specifically, was

June 17, 1977
Royal Canadian Mounted Police this information taken in the form of a formal deposition? Was it taken under oath? Or is there some other means by which the minister can now persuade the House of Commons that we can take the word of one of the persons involved, the Minister of Supply and Services?


Francis Fox: Mr. Speaker, I have before me the page the hon. member referred to. This statement was made after I had the opportunity of personally speaking with and interviewing the Minister of Supply and Services, the then commissioner of the RCMP and the then director general of the security service. When I say I was apprised of this statement, it was not from a written statement which was given to me; it was directly from a conversation. My understanding of the conversation is that they agreed this was a factual statement of the situation.
Also, the Leader of the Opposition asked me a question as to the date on which the meeting was held at which point the Minister of Supply and Services would have been apprised of the contents of the October 9 letter. That date was taken after verification was made of the agenda kept by the RCMP and by the Minister of Supply and Services. It was brought to my attention that there was a general election in the month of October and that the normal meetings, which were held on a weekly basis, between members of the force and the then solicitor general were postponed. The first meeting anyone has in their agenda following the general election was the meeting held on November 6, 1972.


Charles Joseph Clark: Mr. Speaker, just so that I am clear on this: the fact is that there were no sworn statements? In particular, there was no sworn statement from the Minister of Supply and Services relative to this matter? The Solicitor General has nothing under oath; no sworn statement or deposition?


Francis Fox: Mr. Speaker, the hon. member is quite right; I do not have any sworn statement as such. What I have is a clear affirmation by a minister of the Crown stating that these are the facts as far as he is concerned, and telling me that that is exactly what he would say if he were in a court of law. These facts were also brought to light in the presence of Commissioner Higgitt and Mr. John Starnes, and there was no denial of any of those facts. The facts, as indicated there, are entirely corroborated by the people I have interviewed.


Charles Joseph Clark: Mr. Speaker, without pursuing this line, I should like to make it clear to the Solicitor General that at least I will not be satisfied as to the veracity of these statements, particularly those of the Minister of Supply and Services, until we have them under oath or in some other form upon which we can clearly rely.
I should like to turn now to a question of timing, and particularly to a representation given inside this House by the Prime Minister on June 2 and repeated more explicity in a press conference given by the Prime Minister on May 26. At that time the Prime Minister said he could say without equivocation that as soon as the then minister knew about it, he made sure that the proper authorities were made aware of those who would be entrusted and charged with prosecuting any possible
[Mr. Clark.)
offences. There is some question as to when the then minister, the present Minister of Supply and Services, became aware of this matter, but it appears now that it might have been at least November 6. It might have been earlier, but it was at least November 6.
On November 27, 21 days later, the then solicitor general, to the relief of the RCMP, left his portfolio and went on to another portfolio. That means there were 21 days in which he knew of the matter, yet it was not pursued and no action was taken by any incumbent of the office of the solicitor general until March 16, 1976-nearly four years later. How does that square with the statement given by the Prime Minister in his press conference, and repeated in another version in this House of Commons, that there was action taken as soon as the minister knew about it? The evidence given by the Solicitor General stands in direct contradiction of the statement given in this House and the statement given at the press conference by the Prime Minister.


Francis Fox: Mr. Speaker, I do not believe there is any contradiction whatsoever, if the hon. member will give me time to spell it out. As I understand the information given by the Prime Minister in the House and during the course of his press conference, the then solicitor general, the commissioner of the RCMP and the director general of the security service, had no knowledge prior to the break-in. That much was extremely clear. When the hon. Leader of the Opposition refers to the statement of the Prime Minister that action was taken as soon as it was brought to the attention of the responsible minister, I take it he is referring to action taken by the present Minister of Indian Affairs and Northern Development.
Looking back at the citations that the hon. Leader of the Opposition is bringing forward, I think there is a distinction, as is pointed out in my text. No one denies, least of all the Minister of Supply and Services, that he had the letter of October 9 on November 6. However, there is a difference between having a letter before you and being informed of the fact that there had been an illegal break-in.


Charles Joseph Clark: Mr. Speaker, perhaps that would be the case only with a most uninquisitive minister. The fact remains that that minister, the present Minister of Supply and Services, was seized of the information and at least had cause to raise questions-and memories are unclear as to what else he knew-for 21 days while he was solicitor general of this country; and he also knew of these matters for at least another Vk years while he was not the solicitor general but, nonetheless, was a minister of the Crown.
The minister's statement today stated very clearly that neither the RCMP headquarters in Ottawa, nor the solicitor general had been told of the search and seizure of documents prior to the operation being carried out. Did the solicitor general, the RCMP or anyone associated with the solicitor general have any knowledge of any activity taking place regarding L'Agence de Presse Libre du Quebec, le Mouvement pour la defense des prisonniers politiques du Quebec and la Co-operative des Demenageurs du 1" mai, prior to the event in
June 17, 1977

question? Was there any knowledge at all on the part of the then solicitor general, any of his officials or anyone in Ottawa and the RCMP as to any investigation into these groups prior to the offence?


Francis Fox: Mr. Speaker, it seems to me the relevant question before the House is whether anyone was advised or had prior knowledge, either before or after the fact, of any illegal activities, or whether anyone had knowledge of any general surveillance activities which may have been going on in the Montreal area by certain groups. I do not think I would be prepared to answer that type of question.


Charles Joseph Clark: Mr. Speaker, I want an answer to that question either now or at some other time. It is highly germane to know precisely the state of knowledge of the solicitor general of Canada or of his advisers relative to investigations into those groups before the break-in occurred.


Francis Fox: Mr. Speaker, there was an understanding that the security service of the RCMP is supposed to carry out its duties. That is the understanding, and the direct orders are that those duties are to be accomplished according to the law.


John Edward Broadbent: Mr. Speaker, I have three questions to ask in connection with the important statement made today by the minister. The first concerns the meeting which took place, presumably on November 6, between the former solicitor general and senior officers of the RCMP. I find it very strange that the subject matter referred to at that meeting was not whether the RCMP took part in the break-in or not, but what was discussed, according to the beginning of the paragraph at the bottom of page 4 of the statement, was why the former solicitor general received a recommendation that he not acknowledge the letter. I should like to ask the Solicitor General if he ever directly asked the former solicitor general whether at that meeting he inquired of the senior officials of the RCMP whether the RCMP took part in an illegal break-in. If the present Solicitor General did not ask his predecessor that question, why did he not do so?


Francis Fox: The question the hon. member has suggested was one which I put to the former solicitor general. The answer I received was that the direct question the hon. member has mentioned was not put to the RCMP and that the only question asked was why they had thought it was not necessary to reply to the letter. The answer to that, as indicated in the statement I made, was that the Montreal urban community police were investigating the matter. I think that is the complete answer to the hon. member's question.


John Edward Broadbent: The answer may be complete, but does the minister find it acceptable or reasonable that in a discussion involving the allegation that the RCMP consciously violated the Criminal Code his predecessor would not have asked directly whether the senior officials here in Ottawa had information with respect to such an allegation?
Royal Canadian Mounted Police


Francis Fox: In the course of my statement I tried to bring out all the facts that were brought to my knowledge. The statement to which the hon. member refers goes on to say the explanation given to me by the then solicitor general was that he immediately found it, and there is a word of French there, "invraisemblable", I am not sure of the translation-perhaps it is "unbelievable"

that the RCMP could possibly have participated in an illegal break-in, and therefore he dismissed the letter, having been reassured by the RCMP that the whole matter was being investigated by the Montreal urban police. This is one subject which has been inquired into by the commission which the minister of justice in Quebec has set up, as to why that part of the inquiry of the Montreal urban community police was brought to an end.


John Edward Broadbent: I find the attitude taken by the minister's predecessor absolutely "unbelievable", to use the same term. I should like to ask the minister two concluding questions. At the bottom of page 5 of the statement there is a discussion as to whether or not senior RCMP officers, including the former commissioner, took action following Mr. Choquette's denial of police involvement in the break-in. I, at any rate, reach the inescapable conclusion that what is said here would lead any reasonable person to the conclusion that the RCMP was directly involved in a cover-up.
I want to ask the minister why he believes the former director general of the RCMP and the former commissioner were acting in good faith when they knew at the time that the RCMP had broken the law and had taken part in the break-in, and when they learned the then minister of justice in the province of Quebec, possibly in good faith, had said publicly that there was no involvement on the part of the RCMP. Can the minister explain to the House how he interprets his own words in the statement, that they were acting in good faith, when what is at least directly involved, among other things, is cover-up action on their part by not revealing to the public their knowledge of a violation of the law?


Francis Fox: It was made very clear to me by the then commissioner, Mr. Higgett, and the then director general that there was absolutely no cover-up within the force. They had been informed at RCMP headquarters in Ottawa within four days of the break-in. They tell me that the statement made by the minister of justice on October 12 was not brought to the attention of the minister by them, of course, and as far as they were concerned they thought the matter was being properly investigated by the police force in the province which, under the general rules of the Criminal Code, was charged with investigating all such criminal matters.


John Edward Broadbent: We find one question has not been dealt with in all that has been said by the minister today, both in his statement and in reply to questions. It is: Who ordered the break-in? Has the minister asked the RCMP whether they have determined who ordered the break-in?


Francis Fox: The whole question of the break-in itself-there is no doubt whatsoever about that-was handed over to the

June 17, 1977
Royal Canadian Mounted Police
provincial authorities in the province of Quebec and to the attorney general of that province, who launched an investigation to look into that matter. The RCMP co-operated, as of 1976, very closely with the investigation, as my statement indicates. Commissioner Nadon met with the investigator appointed by the province and any information requested was given by him. The result of that inquiry, as I understand it, was the laying of charges against the senior police officers in the three forces who authorized the break-in. In the case of the RCMP, the officer who authorized the break-in made on the Friday afternoon in Montreal was Chief Superintendent Cobb.


Mr. Eudore Allard (Rimouski):: Mr. Speaker, I want to ask the hon. Solicitor General (Mr. Fox) a couple of questions in view of the fact that under the circumstances, RCMP members have been operating in Quebec for many years and one of them is involved, along with the Quebec police, in this recent case, would the hon. minister tell the House if he really intends to cooperate and participate in the investigation that his Quebec counterpart is about to hold, in order to protect his rear guard and eventually let the cat out of the bag, if necessary?


Francis Fox: Mr. Speaker, as I indicated earlier in my statement of which the hon. member may unfortunately not have received a copy yet, I have assured Quebec officials of our intention to participate as much as possible in the inquiry which has been ordered by the Quebec Justice Minister.


Léonel Beaudoin: Mr. Speaker, would the Solicitor General indicate to the House if Jacques Keable who is in charge now of this inquiry is the same lawyer as the journalist who worked for CBC over the last few years?


Francis Fox: Mr. Speaker, if he is, I am not aware of it. 1 have very few details about the background of the person who has been chosen by the Quebec government in connection with the inquiry into this matter.


Léonel Beaudoin: Mr. Speaker, would the Solicitor General tell the House if he will inquire or if he will seek some information about the quality of this lawyer-inquirer and his prejudices that we have known for a long time, and does he intend to inform the House about the character of this individual?


Francis Fox: I think that if there are questions raised about this, I am certain that there will always be members of the Press Gallery only too glad to make them known to the Canadian public.


Elmer MacIntosh MacKay: Mr. Speaker, I should like to ask the Solicitor General about something that appears at page 10 of the statement. It reads:
The process of handling complaints of citizens-certainly in 1972-was not adequate.
(Mr. Fox.]
He says he will correct this in the fall. Surely some improvements must be made in his office at present, compared with the way things used to be. I want to ask whether he endorses the way in which his colleague, the Minister of Supply and Services, handled this affair. Could this happen in his office now?


Francis Fox: Mr. Speaker, perhaps just before answering the specific question which the hon. member has raised he will allow me to respond briefly to two points he made this morning in the course of his reply to the statement. The hon. member referred to a complete report which would have been given to the solicitor general of the day. My understanding is that the report to which he referred would have been made in 1976 to my immediate predecessor, rather than to the Minister of Supply and Services. I think the hon. member would be interested in knowing that some of the facts he stated this morning are not completely correct.


An hon. Member:: Table it.


Francis Fox: I would like to speak, also, of the role of Mr. Cobb. I think the hon. member indicated that he would have been in the office of the solicitor general. That is not quite correct. He was appointed executive assistant to the deputy solicitor general. Of course, the facts that are known now were not known to the senior officers in the minister's office at the time of his appointment.
As to whether this could have occurred today, I hope that that would not be possible. But I recognize there is still need, in spite of the improved procedures in my own office, for improvement, such as that all letters be acknowledged or replied to. In so far as police complaints are concerned, there is need for an impartial, independent body or agency which would look at them.


Elmer MacIntosh MacKay: I gather from the minister's answers that he does not unequivocally endorse the way things were done in the old days and that he is making improvements. I hope he will table the report he mentioned because his predecessor said on various occasions that he would make a full report to the House, which he never did. I want to ask the Solicitor General whether he would not concede that an impartial inquiry into this matter would be better than leaving the force, for which he is responsible at present, to the tender mercies of the Parti Quebecois and the government of Quebec and allowing the situation to become a possible element of confrontation, another item of confrontation between that government and this government. Would he not agree that he could protect the force and discharge his responsibilities better if he instituted an inquiry, particularly in view of the admission he made yesterday that there was no consultation on the terms of reference or anything else before the government of Quebec set up this inquiry?


Francis Fox: I thank the hon. member for this question. I sometimes think that no matter what my answer would be, he would have difficulty with it. At the moment he is saying that it is unfortunate there were no consultations with the govern-
June 17, 1977

ment of Quebec, but 1 sometimes wonder what his question would have been had I said there had been consultations. If that had been the answer, there would have been some idea of a Machiavellian plot to cover up.


Charles Joseph Clark: Just answer the question, Francis.


Francis Fox: I thank the Leader of the Opposition for his suggestion. I have tried to answer all questions which have been put to me.


Some hon. Members:: .Hear, hear!


Francis Fox: There is, however, one point. There is no question arising as to whether there ought to be an inquiry.


John Allen Fraser: Has everybody answered your question?


Francis Fox: I am sorry, 1 do not understand the question. There is no question as to whether there ought to be an inquiry. There is an inquiry going on in the province of Quebec at the moment, and I suppose if hon. members decide, or have some feelings that there have been cover-ups, surely they cannot believe, by any stretch of the imagination, that there could possibly be a cover-up between this government and the government of Quebec at the moment. So there is, of course, an inquiry. The question that arises is whether there should be a second inquiry. As far as I am concerned, I try to fulfil my undertaking to parliament today by bringing all the facts as I know them to the attention of the House of Commons, and I am pleased to listen to the suggestions hon. members are trying to make in this regard.


Some hon. Members:: Hear, hear!


Elmer MacIntosh MacKay: I thank the minister for his answer and I trust, since he is relying so heavily on the authorities in Quebec, that there will also be an inquiry into the matter of the Minister of Supply and Services, so as to do a complete job. I hope he likes his testimony better. But 1 would like to ask him more about the role of Inspector Donald Cobb. How is it that he happened to become attached to the office of the then solicitor general? Was it just a remarkable coincidence, or at whose instigation was it? Who made the appointment?


Francis Fox: I am informed that at the time the deputy solicitor general was in search of an executive assistant. The recommendation about Mr. Cobb would have come from the force. Mr. Cobb, of course, had an excellent background, was a very valued member of the force, and it was thought that members of the force would benefit from having exposure in different areas in government. The fact that he was chosen was simply a reflection of his capacity and the high regard that people have for Mr. Cobb. As a matter of fact, according to what the deputy solicitor general tells me, Mr. Cobb fulfilled his duties with the deputy solicitor general with a very high degree of competence.


Gerald William Baldwin: Mr. Speaker, I would like to ask a question of the Solicitor General. Given the statement made in connection
Royal Canadian Mounted Police with a recent trial at which the judge and others commended these three police officials for their alertness in averting what might have been another apprehended insurrection, given the fact that it was public knowledge that the Prime Minister and other members of his cabinet were very concerned about possible insurrections, and having in mind the ingenuity they showed in imposing the War Measures Act in 1970, has the minister made any attempt to poll his colleagues, from the Prime Minister down-and this is a most likely assumption- to find out whether or not the Prime Minister and others in the cabinet were acquainted with the fact that three police officers had evidence of another apprehended insurrection and had averted it by their intelligent and prompt actions? Has the Solicitor General polled members of the cabinet, or will he do so, to find out if any of them, from the Prime Minister down, were not made aware of that fact back in 1972 after this event took place, as we would assume they would have been advised?


Francis Fox: I realize the nexus the hon. member would like to deduct from both instances. There is no doubt that in 1972, as is the case today, reports were given to ministers of the Crown regarding possible security problems arising in the country. That is partly the role of the RCMP. However, as indicated in my statement, the RCMP have clear direction that both on the security side, as in police work, all their operations must be conducted in complete compliance with the laws of this land, which is the case.


Gerald William Baldwin: I quote what appears at page 4 of the very excellent report which the minister has given. He says at the bottom of the page:
Accordingly, the Minister of Supply and Services categorically states that he was not informed that the theft of documents was the result of an unlawful entry in which the RCMP has participated.
I take it that when making that statement, the Solicitor General is not making a judicial finding on his own that the Minister of Supply and Services was not informed, but is telling the House that the Minister of Supply and Services has so informed him. That being the case, I assume the Solicitor General is very careful, by using that language, not to put himself in the position of guaranteeing that the Minister of Supply and Services was, or was not, aware.
Can the Solicitor General tell us the terms of reference of the Quebec inquiry and how far they will permit intervention or co-operation? What will be the extent of the co-operation? I will come to that later, if I am allowed. Is the minister able to tell us in very concise terms the terms of reference of the Quebec inquiry?


Francis Fox: Mr. Speaker, if the hon. member would refer to my statement, he would find that the terms of reference are included on page 8. I do not know if the hon. member wants me to reread them. Perhaps he will have a look at them.


Gerald William Baldwin: That is one question which perhaps I need not have asked. I have only just had a chance to read the state-

June 17, 1977
Royal Canadian Mounted Police
ment. Having now examined it, and having heard what the minister has said, can the minister now advise us if under the terms of reference as he reads them, the Minister of Supply and Services will be giving evidence? Will he be appearing before this inquiry? Has the Solicitor General explored that avenue, and is there any good reason, in his judicious opinion, why the Minister of Supply and Services should not appear before that inquiry along with other people, including perhaps the executive assistant to the Minister of Supply and Services at the time he was solicitor general, so that the inquiry can explore for the satisfaction of the people of Canada one of the real issues, the issue of the accountability of the government as to whether there was, could have been or likely was, any delay, cover-up or obstruction of justice at the federal government level?


Francis Fox: With respect to the last part of the hon. member's question, I think the facts as stated in my statement would tend to indicate that they will not. In answer to the more general question, I only learned of the terms of reference of the inquiry last evening. It is unclear to me whether the people mentioned by the hon. member could actually be called by the inquiry. I have asked my deputy minister to get in touch with the minister of justice of Quebec to see exactly what is the basis of those terms of reference.


Gerald William Baldwin: Would you encourage the minister to appear as a witness?


David Orlikow: Mr. Speaker, I would like to direct a question to the Solicitor General. On page 1 of his statement he referred to this whole matter as an "illegal search", and then he said in the second paragraph that "no threat to such liberties can justify the use of illegal means to protect these basic rights". Regardless of the judgment of the court, regardless whether there may be an appeal against the decision, or anything else, and since the minister and the government believe that the search in which a senior officer of the RCMP was involved was illegal and improper, I would like to ask the minister whether this senior officer will be disciplined or reprimanded; or will he, according to the commissioner of the RCMP as reported in the press, simply be returned to the position he held?


Francis Fox: Mr. Speaker, the hon. member raises an important question. The RCMP officer who authorized the raid, as the hon. member knows, has been the subject of serious accusations before the criminal courts. He has been brought before the criminal courts. He was tried by a judge who heard all the relevant evidence. That judge came to a number of conclusions which were published in the press yesterday. I know some hon. members do not agree with the sentence which was imposed by the judge, but perhaps the fact that the judge had all the facts before him might lead hon. members to a different conclusion.
The commissioner of the RCMP informed me this morning that when Mr. Cobb pleaded guilty to the accusations brought against him under section 115 of the Criminal Code, he was suspended and that that suspension has now been lifted by the

RCMP in view of the sentence handed down by the judge. The RCMP has taken cognizance of that judgment. The commissioner feels that a suspension is perhpas the most extreme sanction available. He has told me that he wishes to review the circumstances of other people involved, to see whether additional disciplinary action ought to be taken. As hon. members know, under the Royal Canadian Mounted Police Act which was passed by parliament, questions of discipline within the force are the exclusive prerogative of the commissioner.


Walter David Baker: Mr. Speaker, a few moments ago when this matter was being pursued, the Solicitor General indicated that he was certainly not putting himself in the position of in any way guaranteeing the whole truth of what he put forward relating to the involvement of the then solicitor general of Canada. That was the whole thrust of his stance today, and I cannot really blame him because everything with respect to the involvement of the then solicitor general is based upon the word of the then solicitor general to the present Solicitor General. There is not one deposition or sworn statement indicating that the Minister of Supply and Services is telling the truth.
Will the Solicitor General undertake to have his colleague, the Minister of Supply and Services, make depositions under oath setting out all the information that is necessary and relevant to buttress the case which the Solicitor General, under instructions from somewhere, has tried to make? Is this the whole of the case? As a solicitor, the Solicitor General knows that the case is shot full of holes because he relies on hearsay evidence.


Francis Fox: Mr. Speaker, I do not know whether the word "hearsay" means the same in English as it does in the French law schools of the country. Hearsay is normally something told to somebody by somebody else, which is second-hand. The information I have laid before the House is the result of personal conversations I have had with the Minister of Supply and Services and with the commissioner.


Walter David Baker: That is still hearsay.


Francis Fox: Perhaps that is hearsay to the hon. member, but it is not hearsay to me. It is not based on someone else's conversations. As far as the question of sworn depositions is concerned, I have spoken to the people involved, who are no doubt honourable men, including the minister, the commissioner of the RCMP and the deputy director of security services at that time. I believe it is contrary to the procedures of this House to ask for a sworn statement from a minister of the Crown. The minister has told me quite clearly that what he told me is exactly what he would say in a court of law. That means that he was speaking under his own promise.


An hon. Member:: You have never had a tougher client to defend.


Walter David Baker: Mr. Speaker, any statement by the former solicitor general to the present Solicitor General does not have the effect of a statement made in this
June 17, 1977

House, in a courtroom or under oath. My question to the Solicitor General is a simple one, and my reason for asking it is obvious. Will the Solicitor General go to his colleague, the Minister of Supply and Services, who was solicitor general when all this is supposed to have taken place, and obtain from him, and table in this House, a sworn statement as to his involvement in this affair?


Francis Fox: Mr. Speaker, as I understand the rules of this House, if the Minister of Supply and Services feels that his integrity has been impugned, he can certainly rise on a question of privilege and indicate that everything he has told me and everything indicated in my statement is true.


Walter David Baker: Has the Solicitor General been in touch with the Minister of Supply and Services in the course of the preparation of this statement? Has he been in touch by telephone or otherwise to read the statement to him, or to let him know what was to be placed in this statement today and delivered to the House through the mouth of the Solicitor General? Has that happened? Can the Solicitor General tell us whether it is the intention of the Minister of Supply and Services, when he returns to this House, to make the statement which the Solicitor General has indicated could be made and which, with respect, I think should be made?


Francis Fox: On the question of whether the Minister of Supply and Services will make a statement to the House, I am not in a position to respond to that because I have not asked him. On the question of whether I have been in touch with the former solicitor general to show him the statement, he has not seen the statement I made in the House today. It is quite clear that I have spoken to him about parts of the statement which relate to what he sees as being the facts of the matter to which I have referred.
Tariff	
Items	Products Covered
1700-1	Cheese-per pound
EX	New Zealand Trade Agreement Cheese-1 cent per pound. When in packages weighing two pounds each, or less, the weight of such packages to be included in the weight for duty.
1700-2	Cheddar cheese-per pound Australian Trade Agreement
1700-2	Cheddar cheese-1 cent per pound. When in packages weighing two pounds each, or less, the weight of such packages to be included in the weight for duty.
Order Paper Questions QUESTIONS ON THE ORDER PAPER
(Questions answered orally are indicated by an asterisk.)


Mr. Ralph E. Goodale (Parliamentary Secretary to President of the Privy Council):: Mr. Speaker, question No. 2,358 will be answered today.


Mr. Scott: 1.	What was the total number of pounds of cheese (a) imported (b) exported in (i) 1966 (ii) 1971 (iii) 1976?
2.	By province, how many licenced cheese factories were operating in (a) 1966 ' (b) 1971 (c) 1976?
3.	What was the total output of cheese, in pounds, by Canadian factories in (a) 1966 (b) 1971 (c) 1976?
4.	How many applications were (a) received (b) granted for licencing of Canadian cheese factories in (i) 1966 (ii) 1971 (iii) 1976?
5.	What are the tariff rates on (a) specialty cheese imports (b) cheddar cheese imports?
6.	What is the subsidy granted on cheddar cheese exports?


Ralph Goodale: I am informed by the Departments of Agriculture, National Revenue and Statistics Canada as follows: 1. The total number of pounds of cheese: (a) imported in 1966, 18,247,400 lbs.; 1971, 34,611,900 lbs.; 1976, 50,896,900 lbs. (b) exported in 1966, 35,947,900 lbs.; 1971, 32,813,400 lbs.; 1976, 5,135,900 lbs.
2 and 4. This information is not available from Agriculture Canada as licencing is a provincial responsibility.
3. The total output of cheese: (a) 1966, 194,770,000 lbs. (b) 1971, 248,030,000 lbs. (c) 1976, 276,679,000 lbs.
5.	See following table.
6.	Thirty cents per pound on aged cheddar cheese exported
to the United Kingdom			
British Preferential Tariff	Most- Favoured- Nation Tariff	General Tariff	General Preferential Tariff3 cents	3'/2 cents	7 cents	3 cents	
June 17, 1977
Anti-Inflation Act
Mr. Speaker, I would ask that all the other questions be allowed to stand.


ANTI-INFLATION ACT PETITION TO END CONTROLS OF JUNE 30, 1977
[Stage Direction]
The House resumed from Thursday, June 16, consideration of the motion of Mr. Stevens:
That the Anti-Inflation Act being chapter 75, Statutes of Canada 1974-75-76, as amended by chapter 98, Statutes of Canada 1974-75-76, shall expire on the 30th day of June, 1977.
John Allen Fraser: Mr. Speaker, for a few minutes this afternoon I want to address my remarks to the motion brought by the hon. member for York-Simcoe (Mr. Stevens) which was debated yesterday. I think certain things ought to be said bluntly on this second day of debate. The first is that we on this side are getting a little tired of suggestions that we do not have a position on the economic problems of the country, and that we do not have a position on what should, or should not, be done with respect to controls. The fact is, we have had a position on controls and the economic difficulties of this country for a long time. Not only that, but if the positions we have taken, going back some three or four years, had been accepted by the House at the time, we would not have anything like the difficulties we face today.


Some hon. Members:: Hear, hear!


John Allen Fraser: 1 want to add something to that, Mr. Speaker. The fact of the matter is that under our former leader, the hon. member for Halifax (Mr. Stanfield), this party had the guts to tell the Canadian people what no other party in this House had the guts to tell them. We were the first to suggest that something had to be done to break inflation expectations, and if it had been done at the time we were saying it we would have finished with controls a long time ago.
1 have said in this House before, and apparently I have to say it again, that there was nothing in recent history more deliberately dishonest than the 1974 election campaign of the government when they had their own contingency plan for controls and yet went through the election campaign leaving the impression, especially with labour, that they would not bring in a controls system. We put forward these ideas in 1973 and campaigned in 1974 knowing perfectly well that we did not have all segments of public opinion on our side. We knew we were in a battle against public opinion, but we were prepared to fight that battle because it was time politicians had the guts to put their ideas forward and persuade the public to adopt them-not just wait to see in what way the public would go.

In defence of the fact that he cannot find a way, if he wants to get out of controls, stay in controls for a long time, or stay in controls permanently, the Minister of Finance (Mr. Macdonald) said, in effect, last night, "You cannot assail me. The polls in Canada show that the public does not want to get out of controls." I interjected, "What are you doing, making economic decisions by taking polls of what people think they like or do not like?"
The public is sick and tired of a government and of politicians who have forgotten the one fundamental obligation of a politician in Canada, and that is to decide what is the right thing to do and then persuade the public to go along with it: not the opposite. As I said, I am fed up listening to hon. members on the other side, from the Prime Minister (Mr. Trudeau), the Minister of Finance, down through the treasury benches, asking what we would do. I can see them sitting there twisting their limp wrists and saying, "Tell us what you would do." We told them many months ago, and we are telling them again.
Hon. members are smiling, but maybe that is the last thing they have to smile about. Now they are in the crunch. If they do not want to accept our point of view, they should say so. But they should go one step further and tell us what they are going to do. For 20 months this government has not known what to do. First of all, they got into this program on the wrong foot. Second, instead of starting with a freeze which would have affected everybody equally, they started with utter confusion. Third, they have not decided things amongst themselves. Now they wonder why they have problems with labour in this country: labour thinks the government has double-crossed them. We can tell the government what we would do. They should not accuse us of having no ideas. We know what we would do, and we have put it clearly to them. It is up to the government to respond; that is what this debate is all about.
This party has done a service to the country by bringing this motion forward, because the country does not know what the government has in mind in terms of a decontrols period. In all sincerity I ask the government not to leave the country in doubt very much longer. It is doubt and uncertainty that is causing as much trouble now as the inflationary expectations caused a couple of years ago. I do not have to remind anybody in this House that there are about one million people unemployed in this country. The government certainly knows that. Many members on that side understand, as we do, that the problem of unemployment will only be solved if we get the economy going, get productivity going and create a climate for the private sector in which it can do some planning and accumulate plant and equipment. It cannot do that until it knows what the government's plans are.
That being the case, I say there is a direct, blunt, real and urgent obligation on the government to tell the House today
June 17, 1977

what they are going to do. I do not want to hear any more talk from the government side-or from the media-to the effect that we cannot ask the government what they will do unless we have a plan ourselves. Mr. Speaker, we have offered a blueprint already, but the government does not want to accept it, according to the speech made by the Minister of Finance last night. The Minister of Finance said nothing.


Mr. Clarke:: Apparently he doesn't know anything.


John Allen Fraser: That is true. Last night he said nothing. I will not deal with any question of semantics, that is to say, whether it is possible for someone to speak and at the same time say nothing, but if you examine his speech you will see little that is new in it. It does not tell this country's business community where the government wants to go, does not tell labour, our working men and women, where the government intends to go, and does not tell old age pensioners, people on fixed incomes, people outside the trade union movement, ordinary entrepreneurs and small businessmen, what the government intends to do. That speech contains not one single direction post. It gives no sign of what the government intends to do.


William Hillary (Bill) Clarke: If you read it twice, it still amounts to a double zero.


John Allen Fraser: What does it mean for the country? It means this: the longer the government delays making up its own mind, making a decision, the longer the country will be left in uncertainty.
Last night the hon. member for Halifax, my former leader, made a fine speech in which he quoted the Prime Minister as saying that it is the duty of the government to decide. The Prime Minister was not the first politician to say it, but it is signicant that he, this country's most prominent politician, does not abide by those words, because the government has not decided. It is one thing to say these things, quite another to act.
I have been interested to note that for some months colleagues in this House, honourable men and women all of them, have read into the record columns printed in the press, and quoted especially the results of seminars and gatherings of this country's business and labour people; and it is apparent that those who have a direct interest in the economy are unable to make up their minds on what to do. I do not say these decisions are easy; I do not pretend they are, even though I castigated the government. However, my castigation will be to some purpose if the government listens. My point is this: we must find a way out, but the final decision under our parliamentary system must be made by the government. You see, it is curious-I suppose it is one of the peccadilloes of human nature-that when we advocated controls in 1973 and 1974, people opposed us, saying we should not do it. It is somewhat ironic that today some of those very people say, "We do not want controls, but for goodness sake do not get out of them now."
Anti-Inflation Act
There is no good time for removing controls, but this may be the best opportunity we shall have for a long time. As others have said, our production is at 80 per cent of potential, one million are unemployed, but many forces at work in the economy militate against another wage and price explosion. On page 2 of the government document "Highlights of the Discussion Paper on Decontrol and Post-Control Issues" the following words appear:
The time is approaching to remove the temporary control over prices and incomes, and there are favourable conditions for doing so. It seems unlikely that excess demand will lead to a renewed acceleration of inflation when controls are removed. There should be no shortages of food, industrial materials or energy. Controls do not seem to have distorted Canadian labour or product markets, or wage or price structures.
I am not sure I agree with that last sentence. I continue quoting:
Most important, inflationary expectations have changed significantly since October 1975. Canadians no longer expect wages and prices to rise at doubledigit rates. Business and consumers do not foresee substantial price increases.
Ironically, the document says that in other areas there may be pressures on prices, possibly causing them to rise. I say to hon. members on the government side, these words are contained in the government's own document. You know, it is getting late in the day to have it both ways.


James McPhail Gillies: Not if you are Liberal.


John Allen Fraser: I say to the government, you had better act on this document, or tell us why you will not act.
I now come to an important point which all Canadians must face. I know the Minister of Finance would like to end controls; I know it, not because he sent me a letter, but from paying attention to what he has said. He repeated this sentiment again in last night's speech. I happen to know that a good many members on the government side would like controls to end, and I also know that a good many on the government side, although not all of them, think that longterm or permanent controls will do this country a lot of harm. That is my party's position, and it is the view of most people who are prepared to accept the responsibilities and risks which go with a free system. But the Prime Minister has said we must not get out of controls until we have a commitment from various sectors of the economy that they will restrain their demands, that demands will not get out of hand. It is fine to say that in the classroom. That is great in theory. The trouble is, the world does not work that way. It is like saying to Canadians, "We are not going to give you the freedom to make mistakes until we are absolutely sure you will not make a mistake." Such thinking applies to a world which does not exist.
This country is made up of men and women brought up in the tradition that our institutions are free. And they are free to make mistakes. Surely the government need only intervene when those mistakes are so serious as to hurt the welfare of the entire community, that is to say, when they are clearly against the public interest. My friends opposite may say, "You are being philosophical." Perhaps it is a philosophical point. The fundamental question is, are we to be a free country, or is the

June 17, 1977
Anti-Inflation Act
government to intrude on our freedoms by insisting that the state has the right to intrude in every facet of our lives?


William Hillary (Bill) Clarke: That is what they want.


John Allen Fraser: You see, it does not do for businessmen to say, "We do not think we should have controls, but if you get out of them those trade union fellows will get out of line." It will not do for people involved with civil rights, or for ordinary citizens to say, "We do not think we should have controls, but, my goodness, somebody must do something about prices." The fact is that labour and management which, with the government, make up the most important sectors of the economy, must make up their minds. Do they have the guts to accept responsibility and do they want freedom badly enough? Do they want to return to conditions where the government does not make decisions for them, where they will have to exercise responsibility and common sense?


Mr. Mclsaac:: They have not made it so far.


John Allen Fraser: My hon. friend opposite, for whom 1 have high regard says, "You have not made it so far." Do you think, if you remove people from the atmosphere in which they can make their own decisions, they will be better able to make those decisions later? That is a contradiction of human nature. The more you shelter people, taking away from them the responsibility to exercise their rights within some kind of sense of self-discipline and common sense, the harder it will be for them to do it when you move them back into a free atmosphere. That is fundamental.
I say to my friends on the government side that they have not done it yet. They have not done it if they are trying to have heaven this side of the grave. However, we cannot do that. As a Conservative, I do not think the world is necessarily perfect-able this side of heaven. We are in an imperfect world and we have to do the best we can with it.


Mr. Munro (Esquimalt-Saanich):: An imperfect government, too.


John Allen Fraser: My friend says we have an imperfect government. It is not necessary for me to debate that issue. There is no argument there.


Mr. Kaplan:: We admit it.


John Allen Fraser: What I am saying is that there will be no perfect time to say to people that they have to be responsible, that if they want their freedom they will have to exercise it responsibly. There will be excesses. Some people will not be able to accept that. However, that is something we will have to work out as time goes on. There is not a person here with any maturity who thinks he or she lives in a perfect world or thinks he or she will ever accomplish it.
One of the things we have fought for in our community, both politically and economically, is a reasonable degree of

freedom. That results in having to be responsible. There are labour leaders today who can tell you that when controls come off the thing they fear the most is the first management group in a major sector in industry that gives way to a ridiculous demand. That will put terrible pressure on the rest of the labour leaders. They may not tell you that publicly, but they will say it privately. That means management has a responsibility. They cannot just, decide that every time they go to the bargaining table they will give in and just pass it on to the consumer. There is a growing awareness in this Chamber that governments have to be responsible.


Some hon. Members:: Hear, hear!


John Allen Fraser: For those who say that government cannot contain its own expenditures, costs and growth, I say it cannot do that unless those people who are directing government have the will to do it. Just in case anybody tries to take my words out of context, let me say this: I am not one who believes for one minute that you can solve the country's ills by suddenly moving in with a bulldozer and destroying every particle of government that we have in this country. That is inane. There are people with that view and they are foolish or worse. We need to have a handle on government like we need to have a handle on everything else.


James McPhail Gillies: But do we need to have this government?


Robert Phillip Kaplan: That is up to the voters to decide.


John Allen Fraser: We have this government at least for a while. I have to do the best I can on a Friday afternoon to persuade the government to amend its ways.
I want to turn to another matter, the documents and speeches of the Minister of Labour (Mr. Munro). I am sorry he is not here this afternoon. He is representing our country at the International Labour Organization in Geneva and cannot be here for this debate. I know he would want to be here. I understand why he cannot.
Since the fall the Minister of Labour, the Minister of Finance and others, including the Prime Minister, have been talking about the establishment of a national forum to discuss the big economic issues of the day. I am very intrigued that although I have been asking questions since the end of October through November, December, January, February and on, and I made reference to it in a speech to this House on April 21, the government is no closer to establishing this national forum.
The national forum that the government has in mind to discuss the "big economic issues of the day" is a multipartite forum which will include representatives from just about every segment of society that you can imagine. Interestingly enough, in the "Agenda for Co-operation" and in the summary of the "Agenda for Co-operation", that is the green paper, once again this multipartite national forum is put out as being the consultative mechanism by which we are going to conduct to quite a degree on an advisory or consultative basis, our affairs.
The Minister of Finance very appropriately and kindly today in question period straightened out one thing, that is,
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that the discussions going on now which will help him to make up his mind when controls will end and which of the three options the minister put forward will be followed-those discussions will take place with labour representatives and management representatives, not the multipartite national forum.
I am sorry I have to keep repeating in this Chamber to those on the government side that there is no use advocating this multipartite national forum unless you have labour's agreement to go in it. 1 pointed out in the past that they do not have labour's agreement to go into it.
Labour says it will not go in it because it will be outnumbered. It wants to deal with management and government but it does not want to deal with the entire community. It says it would be outnumbered and would not have significance in a tripartite consultative body. If there is any doubt about that, I remind the government that on May 30 in the Gazette, Mrs. Shirley Carr, vice-president of the Canadian Labour Congress, made a statement. The article reads, and I quote:
The Canadian Labour Congress has rejected any role in the body that will likely be set up to advise the federal government on economic affairs when wage and price controls end, Vice-President Shirley Carr said in an interview. She said the body would be too large to function effectively.
That does not come as any surprise to anyone who has been paying attention to what labour leaders have been saying, because they have said it before. Mr. Morris said it many weeks ago. Now Mrs. Carr is saying it.
If you look at the Canadian Labour Comment, which is the publication of the Canadian Labour Congress, for June 10, 1977, you find these words:
We agree with the government's proposal for a consultative assembly to assist in future government planning, but disagree with the government's suggestion that such an assembly be open to a multitude of groups. Such an assembly would be unwieldy and its effectiveness would be diluted to such an extent that it would be of no practical use. We therefore urge the government to return to the format which has recently had some success: a body made up of the three major partners in the economy: government, labour and business.
I am not arguing now about the rightness or wrongness of the CLC position, although I will say that I very much tend to agree with the concept.
What is the use of advocating a multipartite 50 member national forum, the object of which will be to have more discussion of the economic situation, when you have a very clear statement from one of the most important groups that would have to be represented there that it will not take part? After having said this many times and pleaded with members of the government side, I hope they will go to the Minister of Labour and say that maybe the labour critic on the other side does have a point. There is no use advocating something that does not meet with the approval of one absolutely essential group you need to have there.


Donald Stovel Macdonald: They are not saying that in private.


John Allen Fraser: The Minister of Finance says they are not saying that in private. That is very interesting. They have said it to me in private.
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Donald Stovel Macdonald: Not in the consultations.


John Allen Fraser: My hon. friend, the Minister of Finance, says not on the principle of consultation.


Donald Stovel Macdonald: I said, not in the consultation, they have not refused participation.


John Allen Fraser: My hon. friend, the Minister of Finance, says they have not refused participation in this multipartite body in consultations that he has had with them recently. I did not know that. But 1 do know that privately I have been told they are not going to go along with it, and publicly they are saying that they will not go along.
Perhaps we have a difficulty here. These discussions which have been taking place between labour, government and management are to some degree confidential at this time, and I can understand that. However, I am glad the Minister of Finance is in the Chamber today because he now says that, whatever are the public utterances of the CLC, that is not what they are saying privately. That is a little dangerous situation to have arise because the Minister of Finance was in some difficulty some weeks ago-


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. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


The Acting Speaker (Mr. Ethier):: There is not unanimous consent.


Mr. Alexander:: Bob Kaplan, the Parliamentary Secretary to the Minister of Finance, said no.


Robert Phillip Kaplan: I rise on a point of order, Mr. Speaker, which is not to do with withholding consent since I understand there was general agreement among all parties that we would confine our speeches to 30 minutes. I am rising on a point of order, Mr. Speaker, to draw to your attention that, perhaps through inadvertence, two Conservative members in a row have been recognized. The hon. member for Dauphin concluded the debate last night, and then this afternoon the first speaker recognized was from the Conservative party. I know it is a matter of the Speaker's judgment, but-


The Acting Speaker (Mr. Ethier):: Order, please. The hon. member may not have to pursue this matter. The Chair recognizes this and we are prepared to recognize two members from the government side.


Hon. Robert K. Andras (President of the Treasury Board):: Mr. Speaker, I listened with interest to my colleague, the Minister of Finance (Mr. Macdonald), last night, and reviewed his comments, along with those of others, in Hansard

June 17, 1977
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this morning. He has already examined the state of the economy in the context of the anti-inflation program and dealt with some of the important matters relating to the decontrol process. I assure the House that I concur with his assessment and the conclusions he drew in his review, as well as the caution that he expressed as we view decontrol and the postcontrols period.
Nobody would claim that we are out of the inflation woods yet, but I believe that we are making progress and that there are encouraging signs. The Minister of Finance mentioned some last night. I want to deal with others which directly affect my portfolio because I think they do demonstrate in a tangible way that the government has been providing leadership in the conduct of its own operations during this somewhat difficult time. I might add, Mr. Speaker, that we are fully determined to continue to provide that leadership in the equally difficult days ahead.
Let me try to review some of these encouraging signs, Mr. Speaker. The percentage increase in government spending this year is the smallest in more than a decade. I have already given a commitment to the House, which is backed up by cabinet, that fiscal restraint will continue in fiscal year 19781979. The increase in public service man years, the growth of the public service, which has been of some concern both substantively and symbolically, has been virtually halted this year, and again I have given the commitment to this House that that rigid control of manpower resources is going to continue in 1978-79.
Wage settlements negotiated with the public service unions have remained in the main in keeping with the Anti-Inflation Board guidelines. Again I can make a commitment to members of the House that, within the framework of comparability with the private sector, we will continue to offer fair but measured settlements with the federal public service, settlements that will follow and not lead the private sector.
So to the skeptics, Mr. Speaker, I would say look at the record. We were challenged to show leadership in the area of restraint and we accepted that challenge. Indeed we have met it with more than a modest measure of success. What is more, Mr. Speaker, this was accomplished without an economic distortion in the federal realm which would trigger a reaction to bounce back as soon as the controls are removed.
Therefore I think these accomplishments, together with the commitment to continue to be vigilant at the federal level in fiscal affairs, have paved the way, if and when the decision is taken, for relaxing the legislated price and income controls as they apply to federal government activity. But having said that, Mr. Speaker, I want to reiterate the caution that applies equally to the federal government as it does to all other segments of society.
We will continue to hold the upper hand with inflation only through a high level of co-operation between management and labour, between producer and manufacturer, and between government and the private sector. It is this continuing need that makes the concept of a forum for consultation as proposed in the green paper, which seems to be coming under some fire,

so attractive. We simply have to face the fact that governments cannot do it all; we will have to continue to work together. Let us make no mistake about it; the road ahead will not be as easy, nor can the controls period end as easily as the Leader of the Opposition (Mr. Clark) appears to think. I noted a recent public comment which was attributed to him to the effect that it would be a good way to celebrate July 1 by simply turning out the lights and lifting the controls.


Sinclair McKnight Stevens: He did not say that.


Robert Knight Andras: Well, that is the report that I have noted.


Sinclair McKnight Stevens: He did not say turn the lights out.


Robert Knight Andras: He said we should lift the controls. He said it would be a great thing to lift the controls suddenly on July 1. If I said turn the lights out, then that is my description of it. Anyway, apparently he sees the whole program being suddenly dropped on June 30, that this would be a good idea, with the cabinet apparently arbitrarily dealing with the leftovers on the advice of a department that has the monitoring of salary and price increases suddenly added to its responsibilities simply as "other related duties".
I do not think it is a time for grandstanding, Mr. Speaker. I think it is a time for co-operation of the very highest order. I think that is as fundamental to the decontrol process as it has been during the life of the anti-inflation program.
As President of the Treasury Board representing in the government sense the employer, and having to apply the controls to our general expenditure restraint program, I can tell hon. members that we have had widespread and substantial support in making the restraint program work in what we call the bureaucratic system. Without that I do not think the progress that we have made could have been made, nor could it have been made so quickly. My cabinet colleagues and their departmental staffs certainly have not been happy from time to time at the many occasions when they have had to modify their submissions, but they have co-operated in an effort to trim government spending.
It has to be said in all fairness that the public service unions too have, with very few exceptions, tempered their demands in a way that underscores the observation in the green paper that inflationary expectations have decreased in Canada since 1975. This apparent change of attitudes and expectations by many segments of our society, coupled with our continuing commitment to keep inflation in check, bodes well for the immediate future.
In the area of fiscal matters I have already reminded members of my commitment, which has been stated several times, that the federal government will restrain its spending in line with relative growth in the gross national product. The record shows that in fiscal 1976-77 the GNP increased by 13.5 per cent and that our expenditure increase was held to 11 per cent.
June 17, 1977

During fiscal year 1977-78 the forecasters are looking for an 11 per cent increase in the gross national product. I have already told the House that we expect a federal expenditure increase over 1976 in the area of 7 per cent. That translates into a total expenditure for this fiscal year of $44,450 million, budgetary and non-budgetary, including all supplementary estimates through to March 31, 1978.
To emphasize the degree of restraint, that total figure of $44,450 million includes only $1,550 million reserve for all supplementary estimates for the whole of the fiscal year of which, by past experience, $850 million will probably be absorbed by unavoidable adjustments to existing programs, statutory and others. That will leave only $700 million for emergencies or new programs requiring new expenditures. Well, $700 million in absolute figures is a very, very sizeable amount. Relative to the total expenditures, however, it amounts to IV2 per cent. Relative to reserves after the main estimates within expenditure ceilings for any given year or relative to the cumulative supplementary estimates of previous years, that is very tight indeed. I doubt that any fortnight of debates in this House of Commons goes by without there being suggestions for spending from all sides in excess of that reserve.
1 have said that 1 did not get into politics to balance books or to be a bookkeeper, but in the face of the continuing need to combat inflation, and recognizing that the entire public sector-all governments in Canada-is now eating up more than 40 per cent of the GNP, up about 12 per cent from just over a decade ago, the bulk of which is at the provincial and municipal level, all of us in public office have got to maintain a determined effort and leave no stone unturned collectively in an attempt to keep our total public spending in line with the kind of commitments we have been making.


Robert Lorne Stanfield: 1 think you should roll a few stones over and see what is under them.


Robert Knight Andras: Mr. Speaker, we are doing that. The hon. member for Halifax (Mr. Stanfield) has made a rather gratuitous but useful comment about rolling stones over to see what is under them. We are finding a few things we hope to eliminate. I am sure the hon. member had to do that on occasion himself.
I make the statement that we have to maintain and meet our commitment to restrain our spending within the pattern of the gross national product. I make that statement with the full knowledge that emergencies and extraordinary situations may require extraordinary measures from time to time. However, our goal must be to keep federal spending growth in step with the GNP.
I heard the economist, Douglas Peters, comment the other day in Montreal at the CMA meeting. He suggested that we need major new incentives for manufacturing. I should like to ask him what he is willing to trade off in exchange. By the same token we, as members of parliament and politicians,
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must be prepared to cut back in established and existing programs if unavoidable new demands arise and have to be met. We cannot add new ideas requiring new expenditures on top of existing commitments without blowing the lid off.
I should like to comment for a few minutes on another important aspect which is very directly related to my portfolio, and that is the matter of public service compensation and collective bargaining. I do so in light of the anti-inflation program and the decontrol process.
At the outset I should like to state the obvious, and that is, we believe that collective bargaining is the fairest and most acceptable method of determining wages and working conditions for the federal public servant. We also believe in the principle of comparability of compensation wherever possible. It is very much more possible quantitatively than generally thought. I am referring to the comparability of compensation between the public servant and the employee in the private sector-between private industry and government.
There are those who feel that in this field of wage, salary and collective bargaining settlements that the federal government is a pacesetter, forcing wages and salaries up in the market place. The facts deny that allegation. Labour Canada provides a general picture by showing rates of increase in base wage rates for new settlements covering 500 employees. This is a matter of public information and public record. 1 should like to refer to that report which covers the period from 1968 to 1976. It excludes the construction industry.
That report indicates that for municipal public servants the base wage rate increase was 132 per cent; for provincial public servants that wage increase was 129 per cent; for the public sector as a whole the increase was 124 per cent; for all industries, both private and public, the increase was 123 per cent; for the private sector alone the increase was 120 per cent; and at the very bottom of the list the federal public servant wage increase was 113 per cent. Those numbers clearly indicate that the increase in base rates for federal public servants has been less than any other sector, including the private sector. It is equally clear that if the increases in the public sector as a whole are slightly higher than the average, that is due to increases at other than federal government levels.
I have read those statistics into the record because they set the stage for some of the information I would like to give hon. members now. It will add credence and emphasis to what I said at the outset-we are showing leadership during this period of the anti-inflation program.
The AIB summary of public service settlements submitted for review called for an average increase of lOVi per cent, which had been the first year guideline established by the regulations. In fact, just over 80 per cent of the compensation settlements or arbitral awards were at or under the guidelines. That should be compared to other settlements in other sectors of the economy. Outside the public service, the average increase submitted for review was slightly higher than the federal public service and nearly a full percentage point above the guidelines. Thus, even though the federal public service record of base rate increases since 1968 was the lowest on the
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list, it did not prevent us from meeting the same AIB guidelines which others apparently could not meet. And while I am told the anti-inflation program has not yet had a discernible impact on the number of strikes in the federal public service, I am heartened by the dramatic reversal in this kind of activity.
In 1974 one strike was recorded in the federal public service, involving 17,300 employees. The following year, 1975, there were 12 strikes, either illegal or legal, involving about 43,400 employees. And in 1976, the most recent year for which statistics are available, there were six strikes involving only 9,000 employees. During the same three-year period the number of workers involved in strikes in all sectors across Canada almost tripled to a high in 1976 of just under 1.6 million.
While the statistics I have quoted demonstrate the effectiveness of the AIB program, hon. members may wonder about its effect upon the employee. Did he suffer? Did he lose financial ground? Mr. Speaker, workers in this country have experienced a real annual increase in wage rates which, for some, was higher than in previous years. The federal public servant got a real increase of 4.9 per cent, the highest real gain for him since 1971, while in manufacturing average hourly earnings showed a real increase of 6.7 per cent, well above the real gain recorded in any of the previous five years.
So it is not a bad record. What this tells me is that even within the restraint program, even within the constraint of the guidelines, there was room for significant growth in real purchasing power for both the public servant and his counterpart in private industry.
In looking to the decontrol period, the government has already stated its belief that the process and timing for the ending of controls should be the same in both the public and the private sectors. We reject the recommendation which has come from some sources that arbitrary controls should continue to apply to public servants after they have been removed in the private sector. We feel that would be unfair and unworkable. Nevertheless, we feel improvements must be made in the system of public service compensation.
What we are talking about now, and have begun to discuss with the public service unions, is the idea that in the pursuit of the principle of average comparability with the private sector, collective bargaining in the public service must reflect total compensation. In other words, we must give full recognition to the value of wages, benefits and working conditions as part of the compensation package. In other words, we have to give full recognition not only to the wages paid but also to other benefits and working conditions when assessing the total compensation package. Having shown leadership in this area, we are in consultation with the provinces and we hope that they, too, will attempt to bargain on a similar basis of average comparability with the private sector taking total compensation into account.
Implementation of these policies requires the development of improved methods and more detailed data, along with continued consultation with bargaining agents, the pay research bureau and others. The Treasury Board is now in the process of developing detailed work plans which include provision for consultation with all interested parties; I am hopeful that these consultations, which will occur within the context of the green paper, will help clarify the approach to be taken in connection with the achievement of our compensation goals.
1 note that the other day the columnist, Maurice Western, writing in the Winnipeg Free Press, said that the controls program has very wide support and that it was the prospect of decontrols which had aroused apprehension. Well, Mr. Speaker, I outlined a few moments ago the way in which the Treasury Board proposes to proceed with regard to the public service. The green paper sets out the method by which we may proceed in relation to a wider spectrum. I guess that in the end the key word is co-operation. I do not think any one sector can do it alone. I also believe that, given this co-operation, there is no need for much of the apprehension which has been expressed.
I may say I am encouraged by various comments which have come to my attention such as statements made this week at the Canadian Gas Association meeting in Jasper which call into question some of the gloomy views expressed by hon. members opposite in this debate. At that meeting the President of the Conference Board of Canada is quoted as saying:
There is a new attitude developing in Canada today that the gloom and doom of the last few years has passed its peak.
I was encouraged, also, to hear of a comment at the same meeting by Mr. Stevens, who has just taken over as head of the Manufacturers Association of Canada. He said:
It appears that Canada is making the right economic and political decisions and will emerge from this period of adjustment as a stronger nation.
So in spite of the bombast and rhetoric of this debate there is support for the policies of the government, and I think it is a great deal more general than some of our critics in the last day or so would like to admit.


Robert Lorne Stanfield: Would the minister permit a question? 1 do not think his time has expired. He has told us there has been a net gain of 5 per cent, on an average, in the real purchasing power of public servants. As well, the Minister of Finance (Mr. Macdonald) indicated last night there had been a substantial improvement in the position of working people across this country-he mentioned a similar figure. I should like to ask the minister where this improvement could have come from-how it could have been absorbed by the economy when the increase in productivity on a per capita basis was obviously far less?


Robert Knight Andras: The figures, of course, are a result of a calculation taking into account the cost of living and the wage settlements; the result is significantly more to the advantage of the workers to whom I have referred than previous and apparently higher increases in wages accompanied by a much lesser increase in the cost of living.

June 17, 1977


Robert Lorne Stanfield: Might I ask the minister how he expects us to accept his suggestion that there has been a 5 per cent improvement in the position of the working man when there has been a far smaller increase in productivity on a per capita basis? Can he or the Minister of Finance explain how this could be possible?


Robert Knight Andras: 1 think it is obvious that if inflation climbs at a faster rate than wages there is constant chase and the reinjection of inflation, but if both taper down and there is a greater gain in wages than the increase in the inflation rate, the worker gains. I agree that the whole question of national productivity is relevant to this aspect but it does not necessarily form part of that calculation.


Mr. Antonio Yanakis (Berthier-Maskinonge):: Mr. Speaker,
I welcome this opportunity to take part in this three-day debate brought about by the Conservative motion that the anti-inflation controls be ended at the end of June 1977. It is a privilege for me to bring my modest contribution to this debate which is very important for consumers and specially for those who are least able to defend themselves against inflationary pressures, such as the aged, the retired, the non-unionized wage-earners who receive only the minimum wage and others in similar circumstances.
It is difficult for me to understand why the opposition leader introduced such a motion at the present time when statistics show that the anti-inflation program, after 18 months of existence, has proven to be one of the most positive factors to check the price and wage increase rises we have experienced in the years 1974-75. What a strange attitude for the Progressive Conservatives to take by introducing this motion when a recent Gallup poll taken on May 4 last was showing that 70 per cent of Canadians support controls and 60 per cent of independent business concerns are against the removal of salary and price controls in 1977.
Mr. Speaker, it would be interesting to examine the attitude of the opposition these days, since it is neglecting an important legislative program now before the House to tackle a program which has already proved its efficiency and which has received the approval of the Canadian people. Does it want to divert public attention from recent Gallup polls on the popularity of political parties? Do they want us to forget the results of the recent by-elections? It could not be done better. Perhaps they want to forget the two last defections from their party, that is the members for Crowfoot (Mr. Horner) and for Hochelaga (Mr. Lavoie) who have joined the Liberal party. Without trying to be clever, I could add that before long, other members of the Progressive Conservative Party in Quebec and elsewhere will join this side of the House or will leave political life. It is unfortunate that he is not here, but 1 noted yesterday the hon. member for Joliette (Mr. La Salle) who was not very successful during the recent by-elections when he bit the dust. Fortunately the party held him back, because he too would have resigned-something he is well known for.
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Finally, there seem to be various reasons and since the motion must be discussed, let us consider the facts. The Canadian people must not think that the fight against inflation is over, according to Mr. Gerald Bouey, Governor of the Bank of Canada. In the 1976 annual report of the Bank of Canada released last March 21, Mr. Bouey expresses the opinion that 1976 must be considered as the first episode of Canada's fight to get rid of inflationary attitudes and behaviour and to restore the internal economic balance necessary to our future wealth. The report reminds us that the relatively high inflation rate of costs and prices continues to be very dangerous for the health of our economy.
Over the last years, the average nominal income increase of employed people was much higher than in the United States and too high compared to Canada's wealth. Mr. Bouey finds that Canada has become a high production cost country. As long as this situation lasts, he adds, we cannot hope to establish the solid foundations which are essential to the creation of jobs on which our future wealth will rely. On the other hand, the high rate of inflation has seriously affected our competitive position on international markets, which has been reflected in considerable deficits in our foreign trade. As a matter of fact, the average hourly wages for workers in the manufacturing sector of the economy, as of January 1976, were: Canada: $5.03; U.S.A.: $4.80; Sweden: $4.67; West Germany: $3.72; Japan: $3.13; Great Britain: $2.84; and France: $2.19.
Over the nearly one and a half year the anti-inflation program has been in effect, inflation has regressed in Canada. Although we could argue endlessly about the relative part played by the anti-inflation guidelines and other factors, such as the stagnation of the economy, on the control of price increases up to now, the fact remains that all relevant guidelines indicate that the pressures exerted by wage and price increases have been reduced. One year after the introduction of this program, that is, from October 1975 to October 1976, the rise in the consumer price index was 6.2 per cent, which is clearly lower than the 10.6 per cent for the year before. We were very much encouraged by these results when we compared them with the rise of 8 per cent in CPI which we had forecast for October 1976.
What matters more is the fact that the rate of price increases for goods other than food and energy has clearly started slowing down. However, the last CPI report indicates that prices had increased by 6.7 per cent in February compared with a year ago, for food prices had been greatly affected by adverse weather conditions in southern United States. The anti-inflation program objective for the second year, a 6 per cent increase in the CPI until October 1977, remains a challenge. In 1975, according to Labour Canada, wage settlements have averaged an annual increase of more than 20 per cent during their first year of implementation. During the four quarters of 1976, the increase rate has fallen respectively to 16, 12.8, 13.1 and 9.9 per cent. Because of an even lower rate of increase in the consumer price index, the net income increase for Canadians has kept on.
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The report on the first year of the Anti-Inflation Board, published in October 1976, pointed out in its survey of remuneration indicators that the transitional problems faced during the first months of the program had been dealt with and that the program was achieving its objective. The objective is to slow down the rate of wage increases while allowing for a real purchasing power increase for the average employee. Now, in the middle of the program's second year of operation, new progress has been realized to attain that objective.
Since the first months of operation of the program, the wage settlements submitted to the board came progressively nearer anti-inflation indicators, which shows public acceptance and compliance with them. It is obvious that the largest gap in relation to the indicators was found in the remuneration systems which have been substituted for those that came to an end before the implementation of the program on October 14, 1975, but were still under negotiation on that date.
The progress made so far through the AIB's income program are encouraging. The program's real rate of wage increases takes into account both the increases in line with the directives and automatically approved-


Mr. Knowles (Winnipeg North Centre):: Mr. Speaker, I think you will find that there have been discussions and that there would be agreement to suspending private members' hour today so that this debate can continue until five o'clock.


Robert Phillip Kaplan: That is agreed, Mr. Speaker.


Walter David Baker: There is agreement on our side, Mr. Speaker.


The Acting Speaker (Mr. Ethier):: There is a suggestion that private members' hour be waived and that we continue the discussion on the present motion. Is there unanimous consent?


Some hon. Members:: Agreed.


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


Antonio Yanakis: Thank you, Mr. Speaker, 1 resume: -automatically approved by the AIB staff and the increases reflecting the decisions of the board as regard increases exceeding the directives. Those real increase rates, which started at an average of 13.4 per cent for cases settled before the program, then went down to 9.4 per cent during the first year of the program, and to 7 and 5.8 per cent for cases considered up to now during the second and third years of the program. As we are preparing to eliminate the controls and as we are getting closer to the 1980's, it is essential to assess our situation and our economic prospects.
As all other industrialized countries, Canada recently had to face the combined problems of inflation, unemployment and low growth. However we must not forget that Canadians did benefit from a significant increase, up to 5 per cent certain years, in their real per capita income. This increase was more rapid than that of any major accidental industrialized coun-

tries, and twice the average annual increase in the productivity per employee. That period witnessed a number of factors which were exceptionally favourable to Canada. First of all, while external influences added to our inflation problems, Canadians benefitted from a considerable improvement in the foreign exchange situation, the average price of their exports increasing much more rapidly than that of their imports. Secondly, Canada, over the whole period, was a major net exporter of energy, conditions being relatively favourable. Thirdly, thanks to a swifter increase in employment as compared with the population growth, and therefore a much higher proportion of Canadian families receiving two or three or even more pay cheques, the real income per capita increased significantly. Canada created employment for the major part of the labour force at an increasing rate, because of the considerable growth both in the population and the proportion of new workers.
Those favourable conditions could not last. There are limits to the amounts we can borrow abroad to sustain our present level of consumption. Since the international exchange profile is changing and developing countries keep on asking for a better distribution of the world wealth, we might have some problems to maintain favourable exchange conditions. Canada is definitively an importer of oil and in the short term may find itself in the same situation on the whole energy market. In order to realize our potential, we will have to adapt our economic structure. We should not expect too much from the economy either. Inflation is still a major impediment to the achievement of our collective and individual objectives.
Statistics show beyond any doubt that most Canadian workers are reasonably well off after the first year of the program. In spite of a definite slowdown, salaries and wages went up 10 per cent on average. At the same time, the consumer index increase was maintained below 6'A per cent. The unprecedented low level of food prices, the positive effect of prices of the Canadian currency which did resist during most of 1976 and margin benefits being exceptionally low due to the net decline in commercial activities in Canada and in the world, have allowed for a real increase in family income, salaries and wages of some 3'/2 to 4'/2 per cent, which is much above the 2 per cent of the labour productivity increase.
Mr. Speaker, the first duty of the government is to create an atmosphere which will enable private industry to develop in all confidence and to create lasting and satisfactory employment for workers. The present policy tries to establish this atmosphere. The government knows also that specific action is necessary in some areas and among certain categories because of unemployment rates. Therefore they changed their priorities in a federal policy providing for budgetary restrictions in an endeavour to increase support to direct employment programs.
There are signs in the present situation and in the economic prospects in Canada that the next twelve months or so should be a proper time for decontrol. First, given the present underuse of material and human resources in Canada, and in
June 17, 1977

industrialized nations in general, there is little danger of having a new inflationary explosion because of decontrol.
Second, although we cannot put aside the possibility of stock shortages, for instance because of generally poor crops, an oil embargo or a serious breakdown in the trade of a number of basic products, the general conditions of food, industrial raw materials and energy resources supply do not allow us to foresee any major shortage during the next two years. World prices for food, industrial raw materials and energy will probably go up, but at best at a slow pace. It is hardly likely, however, that these products, within the next two years, will be the cause of a price surge similar to that experienced recently.
What is more important is that the inflationary psychosis seems to have been going down considerably since October 1975. The man in the street no longer expects two-digit price or wage increases. Newspapers do not report any more astronomical wage increases which were an invitation to other workers to do the same. According to surveys among industries and consumers, no more rapid price hike is expected. The reduction of the spiral of expectations can be explained by the recent improvements in the control of prices, as well as by the government undertaking to avoid a major increase in the cost of living, through the anti-inflation program.
Therefore, there is a need for a decontrol process which will ensure a steady decrease in the inflation rates and contribute to restore confidence in the future of our economy. This means that we must assess our economic prospects on a realistic basis and take our share of responsibility in the Canadian economic performance. The government has considered the part it could play during the post-control period and set a number of principles to establish the future direction of federal policies. Here are some of these principles: the best way to achieve the Canadian economic potentialities is to ensure a more efficient market economy.
In line with society's expectations, the government is firmly committed to the safeguard of personal freedom, equal opportunities and social fairness. Social policy must protect and improve our evolutive society built up by Canadians without leading to continued government expansion and ongoing erosion of personal freedom.
Our national potential cannot be developed without healthy, dynamic regions. Confederation benefited all Canadians, because the advantages of a larger nation promoted the growth of each and every region. However, remaining regional disparities are a major challenge to our political institutions. Canadians cannot accept those disparities. Federal and provincial authorities have taken a number of significant initiatives. The Department of Regional Economic Expansion is supporting long-term development efforts by the provinces.
Mr. Speaker, in addition to providing a consultation forum, an organization that would monitor economic conditions in respect of their impact on prices and costs would make a major contribution to the improvement of our economic performance. This view is shared both by provincial governments, and certain groups in the private sector, as evidenced by preliminary consultations. In time, the supervising body could exert a
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significant, positive influence on prices and revenues, provided its organizational features and objectivity maintained the required level of credibility.
In ending controls, our foremost consideration should be to prevent soaring prices and incomes, which would signal a return to the previous situation. The tangible results of the controls program, namely a much less rapid increase in costs and prices, must absolutely be preserved and reinforced. Finally, the de-control plan must take place in an orderly fashion. An important area in which the public and private sectors both carry the responsibility of economic performance is labour and management relations. If, indeed, it is the government's role to define the legislative and institutional framework in which labour and management may bargain, both sides must ensure that the system is allowed to work. However, in the last few years the level of confidence in labour-management relationship has constantly deteriorated. The degree of acceptance by public opinion of the increased frequency of strikes and lockouts as well as the various inconveniences and costs that go along with these, is on the wane.
Mr. Speaker, the government expects to raise a public debate on these issues and get some feedback. The increasing uncertainty regarding the date set for de-controls has made it necessary to come to a decision as soon as possible. Therefore, one should consider the possibility of releasing the timing set for de-control by the middle of this coming summer. This decision would take into account the debate and the various reactions generated by this document. Without further delay, the issues at stake should become the subject of a public debate where various comments could be made. Consultations will take place with businesses, workers and other interest groups. The government will also consult the provinces to find out whether during that period it would be necessary to call a new federal-provincial conference of finance ministers. The government is counting on the general participation of Canadians in this debate and will try to devise some ways to achieve that. The government plans on holding a meeting to set a multipartite panel of discussion so as to further the debate on more precise matters, such as the nature of those future mechanisms of consultation and to debate on what the postcontrol period will be before taking a decision on the timing that will be chosen for de-control.
Once the process and the timing of the de-control plan will have been announced, it will be necessary to resume our studies on the various measures to be taken in the post-control era. We hope that the study of the various consultation mechanisms will be sufficiently advanced to allow those mechanisms to play an important part in the preparation of the decisions to be taken and as to the very precise shape that will have such institutions as the monitoring body and the consultation panel that have been proposed as well as the way they will work during the post-control period.
Mr. Speaker, contrary to the expressed views of the opposition, the Liberal government was not afraid through this difficult period in our economy to face up to its responsibilities and to adopt policies that will enable us to solve our problems.

June 17, 1977
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During the de-control and post-control period, we shall invite all Canadians to become involved in the shaping-up of the economic decisions upon which our progress will depend.


William Hillary (Bill) Clarke: Mr. Speaker, it is probably no surprise that this motion has come before the House at this time. The only surprise might be that, having 15 sitting days before it was necessary to debate it, the government scheduled the motion rather more quickly than we expected. Of course that was provided for in the bill which introduced the controls program.
It should also come as no surprise that it was the official opposition that presented the motion yesterday since only this party has consistently voted against the government's controls program. It is true there were other proposals for controls, but it is this party that consistently said a long-term program of controls would be ineffective in curbing inflation.
It was the Prime Minister (Mr. Trudeau) who said we had wrestled inflation to the ground, and we know what happened to inflation rates after he said that. It was the government and the Prime Minister who said controls per se would not work. It was the official opposition that in 1973 perceived the great concern of Canadians at the rate of inflation that the country was subjected to because of the government's programs. In 1974 it was the official opposition that campaigned honestly on a program of controls, pointing out to the Canadian people where the government was taking them with its profligate spending and lack of restraint.
History has shown that the people were not ready for the program of controls that the then Leader of the Opposition (Mr. Stanfield) proposed. There were areas such as British Columbia, however, where people were willing to listen to the official opposition and take their medicine. They elected a majority of members to the House who explained why controls were necessary and why it was important for the government to take the responsible attitude on controls. But the Liberals said no. Then we had to wait for 14 months after the last election until changes began to manifest themselves.
While we cannot be sure, because it has never been said, we can ask ourselves where the former minister of finance and his leader differed on policy so greatly that the former minister was forced by his conscience to terminate not only his career as a minister but his career as a politician. We can blame him or we can blame the Prime Minister. Certainly we can blame the present government because it has had power in this country for too long. The Prime Minister has been in office for nine years, pulling the strings and trying to lay the blame on others because he has been unable to act.
It was the government that said in 1974 that controls would not work. It pointed to countries around the world and said controls did not work in the United States, the United Kingdom and a few other places. Just yesterday the Minister of Finance (Mr. Macdonald) said controls would be completely ineffective in controlling the price of imports. Certainly his

kind of controls would be, because they have been ineffective in controlling inflation.
The latest figures, published on the day the petition of the official opposition was filed, show that for 1977 inflation has been running at an annual rate of 10'/2 per cent. That is a little lower than it was earlier, but still a long way from control of inflation. If we had adopted a short-term freeze in 1974, as the official opposition proposed in order to break the inflationary expectations, then we could have controlled the prices of imports. Importers are businessmen and planners; they do not buy for tomorrow at today's prices. It would have been easy to control the price of imports with a three-month freeze.
It is now a fact that the controls program itself has become inflationary. No longer does labour begin to bargain around a rate of 15 per cent expecting to settle for something below 10 per cent. The floor of labour negotiations is now at least 8 per cent. In the controls legislation 8 per cent was only the base; it could have been 10 per cent in certain circumstances, and even 12 per cent if a historical relationship could be shown.
We never had a freeze so we never had an opportunity to find out what short-term controls would have done. All the government has shown us is that long-term controls have not controlled inflation and have not operated to the benefit of the Canadian economy.
I want to refer to an article which appeared in a recent issue of the magazine Business Week regarding the Canadian economy. I shall quote a paragraph or so. Referring to the Canadian dollar and the troubles of the Canadian economy, it says:
Inflation, averaging more than 9 per cent annually in the past four years and still running at a 7.5 per cent annual rate, has pushed Canadian costs above those of the U.S. and other industrial countries. As a result, Canadian products are being priced out of international markets, Canadians are crossing the border to shop in the U.S., and the nation's balance of payments is plunging deeply into deficit. . .
Business investment, meanwhile, is being discouraged by shrinking profits and worries among businessmen about future growth prospects. And business and labour unions alike are chafing under federal wage and price controls.
The article goes on to say that in 1972 Canada ran a trade deficit of $4.8 billion in manufactured goods, but by last year the deficit had more than doubled, to $10.2 billion.
What has happened under our controls program? Canada is no longer capable of attracting the investment of Canadians or the investment of foreigners. Many of us can point to instances of Canadians investing in the United States, particularly in housing. Perhaps one cannot blame the Minister of Finance on this score directly. The Minister of State for Urban Affairs (Mr. Ouellet) complains about the lack of housing in Canada, but what does one find? One finds entrepreneurs, who would be willing in normal circumstances to provide housing for Canadians, taking their capital and expertise to the United States, there to build houses for Americans.
The article continues a little further along with these words:
Coiled around these problems-
June 17, 1977

Namely, the deficit and continued inflation.
-is a political crisis, the deepest in its 110 years of confederation, that is shaking the unity of Canada to its foundations. The ties that bind the 12 vast and disparate provinces and territories are being severely strained by Frenchspeaking Quebec's drive for greater political and cultural autonomy and by demands of other provinces, especially Alberta, for greater decentralization of decision making.
We can lay the blame for every one of these difficulties at the feet of the present administration, if not at the feet of the Prime Minister.


Mr. Johnston:: Clay feet.


William Hillary (Bill) Clarke: In the nine years of the Trudeau administration we have seen developed the worst economic crisis we have undergone for decades, if not ever, the worst unemployment Canada has ever known, and the most divisive feelings this country has experienced in its 110-year history. As I say, these difficulties can be laid at the feet of the government and its leader, the Prime Minister.
Last night the minister said inflation was under control and not rising greatly. He said last evening, as reported at page 6766 of Hansard:
... we can modify our own wage and salary increases, or modify, in the case of the business sector, the additional claims for profit.
Of course we can do that, but the government has not modified or restrained its own demands on the economy, and 1 wish it would. 1 do not have all the pertinent figures before me for bygone years but recall, according to the last table I saw, that government expenditures increased 16 per cent year over year in at least one instance. Every year, for the last four or five years, government expenditures have increases by at least that figure. In some years expenditure increases were up in the 23 per cent range. Mr. Speaker, we cannot expect people to restrain themselves, modify their wage or salary increases or modify their demand for profits, if the government will not restrain its own demands. Oh, it says it is doing it. But it has a way of modifying the figures to make it seem as if it is doing something in this regard.


Mr. Dionne (Northumberland-Miramichi):: If we listened to you fellows, there would be no restraint at all, because you ask for a new program almost every day.


William Hillary (Bill) Clarke: Mr. Speaker, I heard the hon. member's remarks.


Walter David Baker: Such as they are.


Maurice Adrian Dionne: Such as they are-that comment applies to the hon. member's remarks.


William Hillary (Bill) Clarke: I shall try to put on record some ideas the opposition has put forward for solving the country's difficulties.
People see the government doing nothing and wonder what the opposition has to offer. During my past five years in the opposition, the opposition has offered a great deal, although sometimes it is hard to put the message across. Sometimes we
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have trouble making the government listen to us, or pay attention to our sound ideas. One need only remember the ideas the former leader of the opposition put forth-


Maurice Adrian Dionne: And what happened to him?


William Hillary (Bill) Clarke: -and how long it took the government to appropriate the germ of the idea and distort it into its own so-called program to control inflation.
Yesterday evening the Minister of Finance said in his speech, as reported on that same page of Hansard:
.. .average wage rates increased in 1976 at the rate of 10 per cent, and the consumer price index through that year increased at a rate of 6.5 per cent; therefore, there were real increases for the average working man of between 3 per cent and 4 per cent in the year.
The minister also referred to public opinion and what it thinks of the controls. I conclude that, obviously, the minister has not asked the average wage earner if he thinks his average increase of 10 per cent was able to keep up with the average increase in costs of 6.5 per cent. Obviously, wage rate increases have been somewhat depressed, and the floor put under wage increases by the government's controls program had to rise 10 per cent. The admission the other day of the Minister of Agriculture (Mr. Whelan) and of the Minister of Consumer and Corporate Affairs (Mr. Abbott) implied that a large measure of the reduction in costs, or reduction in the escalation rate of costs, was attributable to a lowering of food prices. Mr. Speaker, in no way has labour been catching up, and in no way have those on fixed incomes, or those with indexed pensions, been catching up with wage rates which have been paid in Canada recently.
The minister yesterday said that public opinion had said, "No, there is no demand in Canada for the removal of controls." He said, as reported in Hansard, page 6767:
We have had in Canada the phenomenon of rising popularity of the controls program, especially on the part of those who do not now have collective power. This fact shows up in the polls, it shows up in the personal contacts I have, and I know it is showing up in the contacts my colleagues have had as well in their own constituencies and throughout the country.
Obviously, the government has not been talking to the same people the opposition talk to-


Maurice Adrian Dionne: How do you
know? You have not talked to our constituents.


William Hillary (Bill) Clarke: in the constituencies, as I would point out to the noisy hon. member opposite. I submit that most Canadians want an end to contols. It is worth noting that at a worth-while conference in Toronto about one month ago business representatives of the investment community and labour, submitted their opinions on the controls program. There was no doubt that the controls program was unanimously disliked. The unanimous opinion of that group was that controls should end. Even the Minister of Finance has agreed in his more lucid moments that controls must end. It is simply a matter of when and how they should end.

June 17, 1977
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The government has been unable to determine how and when it would like controls to end. It is true the legislation was written to continue until the end of December, 1978, but the minister has said perhaps they should be removed sooner than that.
The government suggested three ways of approaching decontrols. Yesterday in the minister's remarks he referred to two principal choices involved in the removal of controls. I do not know what happened to the third one between the time the paper was written and the speech was made. The first he said was the immediate simultaneous withdrawal of controls. The second was to phase out withdrawal of controls.
We on this side have always maintained that a sudden withdrawal is best because, after all, that is what is contained in the legislation. We have proposed an end at an earlier date than the end of December, 1978. Elowever, the government has now decided that a sudden withdrawal of controls is not a desirable method of doing the job, even though it has been unable to explain how a delay in the removal of the controls until 16 or 18 months from now would be any easier than at this particular stage.
It was agreed by everyone at this conference that I attended and referred to earlier that controls should be removed, the sooner the better and the more suddenly the better. I should like to refer to some of the reasons why the different groups said that. Perhaps I should start with labour because that is the group whose opinion is most often tossed around.
Labour probably wants higher wages. After all, that is the duty of labour leaders. They are in a job for the same reason as business leaders, to increase the returns to that sector. Labour leaders understand that controls are damaging the economy of Canada. They understand that controls are hurting their own constituency, labour. They understand there will be no more jobs because there will be no more investment in Canada as long as we have controls.
I already referred to the investors who are seeking foreign fields for their capital. Investors can work with any set of rules any kind of government wants to give them. However, investors and business people must know what the rules are. They cannot go into a game, to quote what my leader said at that conference, not knowing what changes in the rules are going to happen overnight. They need to have something to go on, some confidence. The last thing this government has given them over the past nine years is confidence.
Confidence is necessary. Otherwise there would not be any investment. If there is not any investment, there will not be any new jobs. That is a simple equation. That is the way the economy works. It may be that the Prime Minister wants the economy to work in that way. From remarks he has made, one may have reason to doubt what his real objectives are.
I think that covers the reasons why business wants controls removed. I dealt with the labour unions. I think of the white collar worker. We have had complaints in the House this week about the ineffective application of the executive compensation

aspects of the anti-inflation rules. It seems all right for the top executives to get huge increases as long as the white collar workers do not get any. It is obvious the white collar worker wants a bite at the increasing apple, but he is not getting it under the present rules.
It might be worth while to look at who does not want controls removed. The minister talked about provincial governments. I think they are the only ones he referred to that do not want the controls program removed. Even my own province of British Columbia has said that it would institute a program of controls if the federal government got out of it. The federal government, with all respect, has not shown any sign of getting out of it. The only reason the provincial government in British Columbia said it would institute its own program is that it has a terribly serious labour problem in that province. Finally, yesterday the Minister of Finance made a proposal to enter into one step of decontrol. I will be very interested in hearing what the provincial government has to say when it hears about that step. It will probably agree with it.
Before I come back to that decontrol step, I want to talk about pensioners. The Minister of Finance very neatly neglected to talk about pensioners yesterday, and what they think about controls. It is true that some pensioners in Canada get an indexed pension. It can hardly be said that the indexing of the Canada Pension Plan, the old age pension, or even the guaranteed income supplement will be a joy to pensioners whose rents or taxes are going up at great rates and whose other costs are going up at rates faster than their pensions.
Coffee prices may be an example of something that has gone up by 300 per cent. Rents, because they are controlled in many provinces, now have a floor. Therefore they are guaranteed an increase of 8 per cent, 10 per cent, or whatever the floor happens to be. There is not a maximum but a minimum on rent controls.
What about pensioners who are on private pension plans or, worse still, invested in Government of Canada bonds to provide for their old age? Look at the return value on that notorious set of 3 per cent perpetual bonds in 1936 which have been extended and will now be called in 1996. That makes them a 60 year bond. The people will be long gone before their bonds are redeemed.


Howard Earl Johnston: It is known as Liberal bondage.


William Hillary (Bill) Clarke: Yesterday in his remarks the minister appeared as though he were reaching for manna from heaven. I want to quote the remarks of the Minister of Finance:
To provide for greater certainty with the approach of decontrol, the government has therefore decided to propose amendments to the Anti-Inflation Act to deem these agreements to be amended in line with the AIB recommendation or order of the Administrator. An amending bill would be introduced to deal with this. In the same way, the law will make sure that profit restraints imposed, for example, by excess revenue orders, will be effective.
Second thoughts again. I am reminded of the initial imposition of the program where dividends were frozen, to the complete ignoring of the dependence of pensioners who had no other means than dividends to keep abreast of inflation. That
June 17, 1977

provision was later amended after second thoughts by this second thoughts government.
Hon. members opposite say that the opposition has not had any ideas or recommendations to put forward. We are the ones who had the policy and have been pushing the policy of controls and decontrols. Days before the Minister of Finance stood up in the House yesterday and announced what he was going to introduce by way of amendments to deal with agreements which had been amended in line with the AIB recommendations, the Leader of the Opposition (Mr. Clark), in a speech in Toronto, as well as in a speech in Montreal reported on Monday, June 13, which I am going to refer to, had stated what our policy was. He said that there were at least five items which his party would put into the decontrols program. The very first one is to respect judgments which have already been made by the Anti-Inflation Board limiting excessive wage or price increases. You can read that anyway you want, Mr. Speaker, but it comes to exactly what the minister said, namely, that agreements made outside the Anti-Inflation Board regulations would be required to be respected.
I cannot always expect the public to recognize what it is that the Leader of the Opposition says, particularly in my riding in British Columbia, because the article I am referring to was reported in the Vancouver Sun last Monday, June 13, on page 60. How can we expect anyone to undersand what it is that the official opposition, which is trying in spite of the efforts of the government to save the economy of Canada-


The Acting Speaker (Mr. Ethier):: Order, please. I regret to interrupt the hon. member but his allotted time has expired.


Lorne Edmund Nystrom: I thank the House for the enthusiastic applause.


Stanley Howard Knowles: We are unanimous.


Lorne Edmund Nystrom: We are a party which is solidly unified.
I rise to participate in this debate in support of the motion put forward by the Conservative party to end this particular controls program on June 30 of this year. I happen to think that it should have been ended earlier. The reason I say that is that I am not opposed to controls per se but I am opposed to the very unfair and inequitable program brought down by the government.
1 want to spend my few moments today talking about some of this unfairness in very specific terms. The leader of my party mentioned in his remarks yesterday some of the aspects of the controls program and some of the options that we would rather see. Hopefully on Monday someone else will deal with other aspects of the program. I want to deal with some of the specific unfairness of the program which is before us, particularly as it concerns increases in executive compensation or salaries.
One executive received an increase in his salary last year of 70 per cent namely $60,363. It is an increase of that sort, Mr. Anti-Inflation Act
Speaker, that makes this program very unfair. The same thing applies to company profits. We know that the salaries of workers have been held to increases of 8 per cent or 6 per cent.
I have a list of about 50 companies with profit increases all higher than those allowed to the workers, the highest being 215 per cent. It is for reasons like that I oppose the anti-inflation legislation.
In commencing my remarks today I want to make it very clear that I am for controls, for a planned economy. But I am for one which is fair to everyone-workers, salary earners, profits, prices, bank interest and so on, one which will equally control all aspects of the economy. Unless we have that there should be no program at all. It must be fair to each and every one of us in society.
1 should like to put on record some of the very unfair things which have been happening in this country since the controls program came into effect on October 15, 1975. First of all, ordinary working citizens are permitted a maximum salary increase of $2,400 a year. I have a list here of 51 executives in 26 companies who have received salary increases higher than the $2,400 limit and I think it would be worth-while to put some of these on the record.
The first company is McIntyre Mines Limited of Toronto. Mr. P. A. Crain their vice-president of operations, received a salary increase of $25,488 in 1976-


An hon. Member:: That is more than you made.


Lorne Edmund Nystrom: That is right. That represents an increase of 51.3 per cent. I am excluding the expense allowance and so on that other MP's get.
The second company' is Bow Valley Industries Limited of Calgary, in beautiful Tory Alberta. The president of the company, D. K. Seaman, had a salary increase last year of $35,000, or 70 per cent. B. J. Seaman, the vice-president, received a salary increase of $26,000, or 51.9 per cent. Let us not forget that ordinary workers are held to an increase of $2,400 under the law. Many of them cannot even get that. They have had their salary increases rolled back. Another vice-president of this company, D. R. Seaman, received a salary increase of $19,000, or 46.3 per cent. Then a guy named J. R. Harris, senior vice-president in the same company, had a salary increase of $20,000 last year, or 35.7 per cent. H. D. Binney, another senior vice-president, was treated really roughly; this guy only got a salary increase of $9,333 or 22.4 per cent.
I now move on to the third company-and here I move out of Tory Alberta into Tory Ontario-the Van Der Hout Associates Limited of Toronto. John B. Van Der Hout, an officer of the company, last year received a salary increase of $30,233, or 42.9 per cent.
The fourth company, also in Toronto, Rio Algom Mines Limited, gave the chairman of the company, Robert D. Armstrong, only a very small percentage increase, 3.5 per cent, but you will see in a moment, Mr. Speaker, why it was so small. His salary in 1975 was $223,566. It went up to $231,400, an increase
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June 17, 1977
Anti-Inflation Act
of $7,834, roughly triple what is supposed to be the maximum increase under the guidelines. As if that were not enough, the president of the company, George R. Albino, had a salary increase of 18 per cent; his salary was increased by $27,467. I get very angry when I go over these figures, Mr. Speaker, and know that the government expects the ordinary workers to tighten their belts. Elere are company executives abusing and getting around the controls program through loopholes in the law.
The fifth company is Ashland Oil Canada Limited of Calgary. The chairman of the company, El. Earl Joudrie, received a salary increase of 10.5 per cent, or $12,450. The president of that company, Vernon Van Sant, Jr., had a salary increase of
8.2	per cent, or $8,700.
Turning to the sixth company, Pacific Petroleum Ltd. of Calgary, the president, L. M. Rasmussen, had a salary increase of $21,455, which is 13.6 per cent; the executive vice-president, A. M. McIntosh, had a salary increase of $30,372 which is 42.8 per cent. That was an increase for a man who was already receiving a salary of $71,030 before it was increased to $101,402 last year under the program of the Minister of Finance (Mr. Macdonald). Next is the senior vice-president, W. El. Tye, who had a salary increase of $8,533, which is 9.2 per cent, bringing his salary up to $100,578; and then Kelly H. Gibson, a director of the company, had an increase of $14,227, which is 11.1 per cent. He was a very poor man who only earned $127,917, and his salary for last year was $142,144. Those salary increases are a lot higher than the wages of my constituents, which is not just, as far as I am concerned.
The seventh company 1 should like to refer to is Aquitaine Co. of Canada in Calgary. The president of that company is Mr. Jacques Payah. His salary increase was $15,570, which is
20.2	per cent, bringing his salary from $76,946 to $92,516.
Quebecor Inc. of Montreal is the eighth company. The executive vice-president is Pierre Gauvreau. He had an increase of $10,110 in his salary, which is 18.9 per cent.
The ninth company is Dome Petroleum Ltd. of Calgary. The president, W. E. Richards, had a salary increase of $5,757, which is 6 per cent, bringing his salary from $95,169 up to $100,926.
The tenth company is Home Oil Co. Ltd. The president is R. F. Phillips. His salary increase last year was $3,608, which is 4.2 per cent. He is a poor fellow whose salary was increased from $85,250 to $88,858. The executive vice-president of that company, M. P. Paulson, had a salary increase of $3,400, which is 4.9 per cent.
Chieftain Development Co. Ltd. of Edmonton is the eleventh company. The president is Stanley A. Milner. He received a salary increase of $5,593, which is 8.5 per cent. The vice-president is Gerald W. Youell. He received a salary increase of $3,598, which is 8.7 per cent.

The twelfth company is Ranger Oil (Canada) Ltd. whose president is John Pierce-


An hon. Member:: He is reading the phone book.


Lorne Edmund Nystrom: For the hon. member's information, 1 am reading a list of people who had salary increases last year of over $2,400 despite the controls program of the Government of Canada.


Sinclair McKnight Stevens: We have already made that point twice.


Lorne Edmund Nystrom: The controls program limited salaries of Canadians to an increase under $2,400.


Sinclair McKnight Stevens: You are going to vote with us, then?


Lorne Edmund Nystrom: Yes, I will.


Sinclair McKnight Stevens: Good.


Some hon. Members:: Hear, hear!


Lorne Edmund Nystrom: I think it is useful to put on the record some concrete evidence of the inequities in the program brought down by the Minister of Finance.
When the hon. member for York-Simcoe (Mr. Stevens) interrupted me, I was referring to Ranger Oil (Canada) Ltd. The president of that company is John Pierce who had a salary increase of $6,252, which is 6.6 per cent. That increased his salary from $94,748 to $101,000.
The thirteenth company is Sun Lite Oil Co. Ltd. The president, Edwin C. James, had a salary increase last year of $5,000, which is 9.7 per cent; and the vice-president, Donald E. Hockaday, had a salary increase of $5,000, which is also 9.7 per cent.
Scurry-Rainbow Oil Ltd. of Calgary is the fourteenth company. F. C. Finn, the vice-president of that company, had a salary increase of $3,050, which is 7.5 per cent.
The fifteenth company is Westburne Petroleum Services Ltd. The president, Walter S. Zaruby, had a salary increase of $12,000, which is 17.2 per cent.
We see no justice whatsoever between the wealthy in our society and the ordinary citizen. That reflects the priorities of the Liberal government sitting across the way.
To continue on, the sixteenth company is Placer Developments Ltd. of Vancouver. The chairman of that company, Ross G. Duthie, had a salary increase of $12,458, which is 14.5 per cent. Most of my old age pensioners do not receive that in two years.
The seventeenth company is Norcen Energy Resources Ltd. in Toronto. The president is Edward Battle. He received a salary increase of $3,100, which is 2.6 per cent.
Now I would like to turn to some of the large ones. The eighteenth company is Imperial Oil Ltd. of Toronto. The president and chairman of that company, John Armstrong, had a salary in 1975 of $234,333. To be fair his salary should
June 17, 1977

be rolled back, but instead it was increased to $251,600, which was an increase of $17,267 or 7.4 per cent.


Howard Earl Johnston: Where was the AIB?


Lorne Edmund Nystrom: As the hon. member says, where were they? Where was the Minister of Finance when John Armstrong, the president of Imperial Oil, had his salary go up to over one quarter of a million dollars? As if that was not good enough, the executive vice-president, James G. Livingstone, had his salary increased to $145,000, which is an increase of $17,967, or 14 per cent.


An hon. Member:: Are you against the amount or the
money?


Lorne Edmund Nystrom: I am against the increase. It is interesting to note that one Liberal does not seem to get the point. It is very unfair that these corporate executives have received huge salary increases while ordinary Canadians have had their salaries rolled back.


Stanley Howard Knowles: The original amounts were too large, in the first place.


Lorne Edmund Nystrom: If the hon. member from southern Ontario wants me to reread the list, I can. I would be willing to do that in order to make my point clearer. I really do not think 1 have the time, but I was dealing with Imperial Oil-


An hon. Member:: What have you got against the size?
Anti-Inflation Act


Lorne Edmund Nystrom: 1 am against the size. I do not think the president of Imperial Oil is worth $251,600. Does the hon. member really think the president of that company is worth that amount of money? If that is the case, I invite that member to get up on his feet and say so. I am sure his constituents would be interested to know that. Is he in favour of that man receiving an increase of $17,267 in 1976, despite his huge salary?
Returning to the eighteenth company, the executive vicepresident of Imperial Oil is a man by the name of Donald K. Mclvor. He received a salary increase of $18,013, which is 16 per cent. Perhaps all these gentlemen have Liberal memberships. His increase brought his salary up from $112,987 to $131,000 per annum. This is under controls. What is going to happen when the controls program ends?
The nineteenth company is Kaiser Resources Ltd. The executive vice-president, Robert McPhail, received an increase of $22,059, which is 21.4 per cent. I should like to finish dealing with this company, if I may. The vice-president, Howard Cadinha-


The Acting Speaker (Mr. Ethier):: Order, please. It being five o'clock, this House stands adjourned until Monday, June 20, 1977, at 11 o'clock a.m.
At 5 p.m. the House adjourned, without question put, pursuant to Standing Order.
8001 8-30 Vi

Monday, June 20, 1977