1978-10-16

ROUTINE PROCEEDINGS


Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity arising from the practice of the government to cover-up and conceal information from parliament on questions asked by the opposition, in particular when the answers might be embarrassing to the Prime Minister (Mr. Trudeau) or any of the ministers. An indication of this is, among other things, that at the conclusion of the last session there were many unanswered questions- some on the order paper for weeks and months-which, unless placed on the order paper for this session, will remain unanswered. To ensure that they will be answered, I move:
That all of the said questions be added to the present order paper, in order that the answers thereto shall be given without delay.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



ROYAL CANADIAN MOUNTED POLICE


Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I rise under the provisions of Standing Order 43. The former solicitor general, Mr. Fox, at the time the McDonald commission of inquiry was established, with reference to the commission's right to decide what was or was not to be held in camera, said the following:
Whether or not the commission would do it in camera or in public depended on the decision of the commission itself in conformity with those terms of reference and powers.
Considering that the Prime Minister (Mr. Trudeau) was quoted in the Ottawa Citizen last Saturday, October 14, as having said, the commission "shouldn't have the right to tell the public what a minister said to me about the operations of the RCMP" both contradicts what the former solicitor general said and completely undermines the integrity of the McDonald inquiry, I move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House instructs the government to live up to its original commitment by accepting Judge McDonald's decision as announced last Friday that it is the commission itself which has the right to decide what testimony and evidence is to take place in public and what is to be kept in camera.


Mr. Speaker:: The presentation of such a motion for debate at this time can be done only with the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



CANADA ELECTIONS ACT


Mr. Tom Cossitt (Leeds):: Mr. Speaker, I rise on a matter of urgent necessity concerning a section of the Canada Elections Act pertaining to the requirement prohibiting the serving of alcoholic beverages in restaurants and the opening of retail liquor stores while a federal election or by-election is in progress, thus resulting, as an example, in the ridiculous situation existing in the Toronto riding of Rosedale, where restaurants may legally serve alcoholic beverages today on the west side of Yonge Street from the waterfront to Merton Street but may not do so on the east side of Yonge Street because it is in Rosedale.
I move, seconded by the hon. member for Winnipeg South Centre (Mr. McKenzie):
That the government immediately bring before the House an amendment to the Canada Elections Act, following the example set by the Ontario Progressive Conservative government with regard to provincial elections, in order to allow licensed establishments, etc., to remain open on federal election days, and thus remove this Victorian anachronism not in accord with present-day thinking.


Mr. Speaker:: The presentation of such a motion for debate at this time can only be done with the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.

October 16, 1978
5.0.	43 GRAIN



MOVEMENT THROUGH CHURCHILL, MAN.-MOTION UNDER

[Stage Direction]
5.0.	43
Mr. Cecil Smith (Churchill):: Mr. Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity. Due to a two-week strike at the port of Churchill this summer, grain movement through the port will be down by seven million to nine million bushels. This will place the port in a loss position. The port has a storage capacity of some four million bushels. It is my understanding that there are no plans to utilize this available storage. Therefore, I move, seconded by the hon. member for Moose Jaw (Mr. Neil):
That the government instruct the Wheat Board to use the port of Churchill storage, which will give the farmers a break in increased quotas and place the port in a break-even cash position.


Mr. Speaker:: Such a motion can be presented for debate at this time, pursuant to the Standing Order, only with unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



CANADIAN NATIONAL RAILWAYS


Mr. James A. McGrath (St. John's East):: Mr. Speaker, I ask for unanimous consent, under Standing Order 43, to move a motion of urgent and pressing necessity. Last week, CN informed the unions of its intention to reduce train service in the province of Newfoundland. This constitutes a major breach of the undertaking given to this House by the Minister of Transport (Mr. Lang) that there would be no reduction in CN train service in Newfoundland during the life of the royal commission on CN's operations in that province. That commission, sir, has yet to submit its final report. I move, therefore, seconded by the hon. member for St. John's West (Mr. Crosbie):
That this House directs the Minister of Transport to order CN to continue the present level and frequency of train service in the province of Newfoundland.


Mr. Speaker:: The presentation of such a motion for debate at this time requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



OLD AGE SECURITY


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, under the provisions of Standing Order 43, and seconded by the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), I move:
That this House urges the government to introduce, without delay, an amendment to the Old Age Security Act to end the discrimination therein against persons of single status between the ages of 60 and 65 by providing for the equivalent of the spouse's allowance to be available to all persons between the ages of 60 and 65, regardless of marital status, provided they are out of the labour market.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



PRESENCE IN GALLERY OF SECRETAIRE GENERAL DE


Mr. Speaker:: Order please. Before the beginning of the oral question period, I wish to point out the presence in the Speaker's gallery of a very special guest, Mr. Xavier Deniau, secretaire general de l'Association internationale des par-lementaires de langue franqaise.



ORAL QUESTION PERIOD


Mr. Joe Clark (Leader of the Opposition):: Mr. Speaker, my question is directed to the Prime Minister and relates to the unanimous view of the McDonald royal commission that in so far as the confidentiality of testimony is concerned, the same rules that have applied to the police should apply to politicians. I wonder whether the Prime Minister would tell us if he continues to contest that unanimous view of the royal commission?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, in terms of access by the commission to anything ministers or
October 16, 1978

senior officials may have said or thought or written, there is absolutely no distinction between them and the ordinary policeman, to use the expression of the Leader of the Opposition.


Charles Joseph Clark: Mr. Speaker, the Prime Minister knows very well what he is attempting to do now, and that is to say that where it is within the discretion of the royal commission to publicize the testimony of police officers, it is not within the discretion of the royal commission to publicize the testimony of politicians. In other words, he is proposing a double standard: one standard for the police, that of openness, and another standard for politicians, that government people who might have things to hide have the ability to take away from the commission the right to decide what is made public.
Are we correct in assuming that the Government of Canada will continue to contest the idea that there should be the same standard applied to testimony relating to ministers of the Crown as is applied to police officers?


Pierre Elliott Trudeau: Mr. Speaker, the Leader of the Opposition has made a little speech and I can say that it is quite incorrect. The rules will be the same in both cases, whether it is a policeman, minister or senior official of the RCMP, as they apply to the commission.


Charles Joseph Clark: Mr. Speaker, what the Prime Minister is saying, as he says so often, is that black is white. That is clearly not the case. There has clearly been a misrepresentation here. Since counsel for the government, Mr. Nuss, is reported as saying, after he received and heard the unanimous position of the royal commission, that there are other remedies open to the government, I wonder if the Prime Minister would tell the House of Commons what those other remedies are.


Pierre Elliott Trudeau: Mr. Speaker, the Leader of the Opposition is probably talking about hypothetical situations. As far as I know, in every case where the commission has wanted to have access to something or to publish something, it has been discussed with counsel for the government and an agreement has been reached. I know of no case where the commission has wanted to do something and has not been able to do it.


Charles Joseph Clark: Mr. Speaker, I am sure the Prime Minister will rule that this question is far too hypothetical for him to have to answer to the mere House of Commons, but would he give us an undertaking, now, that if the Government of Canada intends to change the terms of reference of the McDonald royal commission, and to do that by order in council, it will refer the proposed change in the order in council to this House of Commons for review and debate?


Pierre Elliott Trudeau: Mr. Speaker, the question is hypothetical and it is based on a complete misconception of what the commission itself is saying. It said, quite clearly, in its statement issued last week that in every case where it has asked something of the government, it has been satisfied. For example, on page 3 of the statement it says:
Oral Questions
-all documents requested by the commission, or photocopies of them, have been transmitted by the RCMP to the commission.
On page 4 it says:
The examination of witnesses to date has not been hampered by the failure to resolve-
There is no case where the government and the commission have not seen eye to eye in everything that has happened in front of the commission. If the Leader of the Opposition is worried about what is going to happen down the road, let him stay around and ask his questions when they happen.


Mr. Bill Jarvis (Perth-Wilmot):: Mr. Speaker, my supplementary question is to the Solicitor General, who told the House last week that there had been absolutely no change in the government's position vis-a-vis secrecy in the McDonald royal commission, despite the fact that his lawyer argued for approximately eight hours, covering 315 pages of testimony, advocating a very dramatic change of position.
In view of the statement of some 33 pages in length released by Mr. Justice McDonald last week, does the Solicitor General maintain the view that he, through his counsel, has not substantially and dramatically changed the government's position toward the openness of the hearings of the McDonald commission?


Hon.   J.-J. Blais@Solicitor General: Mr. Speaker, as I indicated to the hon. gentleman, and as I have made quite clear on a number of occasions, there has been a great deal of openness. The right hon. Prime Minister has substantiated that by quoting chapter and verse from the statement of the commission. There is another statement that I would call to the attention of the hon. gentleman. It is on page 23 of that statement:
The commission is optimistic that in the future, as in the past, a spirit of reasonableness will enable counsel and the commission to arrive at a result in a particular case which achieves the commission's desire to hear as much evidence as possible in public while at the same time ensuring both that the national security is not endangered and that the public interest is served.
That is exactly the government's position.


William Herbert Jarvis: A final supplementary question to the Solicitor General, Mr. Speaker. I am sure the commission's optimism is based on its faith in its own integrity being far greater than the government's in this instance.
With reference to the statement issued last Friday wherein Mr. Justice McDonald said other options were open to the government-one of those options, obviously, is recourse to the infamous provisions of section 41(2) of the Federal Court Act-may I ask the minister if he is considering recourse to that insidious section, or is he considering as an alternative section 41(1) of that act where an application to withhold documents can be made to a superior court judge?


Mr. Blais:: Mr. Speaker, again, the hon. gentleman is speaking of purely hypothetical cases. I would suggest that he hang around with his leader and ask the questions when they arise.

October 16, 1978
102___________________________________
Oral Questions PUBLICITY OF MCDONALD COMMISSION HEARINGS


John Edward Broadbent: Mr. Speaker, my question is for the Prime Minister. In his earlier answers to the Leader of the Opposition, he left the impression that the matter to be resolved in this dispute was the question of accessibility of information which, of course, is irrelevant.
The Prime Minister knows that the contradiction which exists between his position and that of the royal commission concerns the question of publicity-open sessions, or closed. Since, in my view, this goes to the root of the issue, I should like to ask the Prime Minister if he stands by what the former solicitor general said on July 6, 1977, in this House: he said that whether or not the commission would do it in camera or in public depended on the decision of the commission itself, in conformity with its terms of reference and powers. This is contradicted by what the Prime Minister said, when referring to the commission and according to a quote in last Saturday's Ottawa Citizen, as follows:
-shouldn't have the right to tell the public what a minister said to me about the operations of the RCMP-
I ask the Prime Minister: has he, or has he not, contradicted, clearly, the right of the commission to decide whether it is going to have its proceedings in public? If he has as is my view, contradicted this basic principle, will he withdraw that and allow the commission to make its own determination, as was promised at the outset?


Pierre Elliott Trudeau: Mr. Speaker, the leader of the New Democratic Party says the problem of access is irrelevant. I do not think it is. I think it is very relevant for the people of Canada and members of the House to know that the government is not only, as the commission says, giving everything to them that they have asked for, but we have even given more. We have led them to files; we have shown them things they should know. I think this is very basic to people judging whether the government is trying to cover up or not. We have confidence in the commission and its independence. We have done everything we could to make sure it got what it wanted, and more than what it wanted was in front of it.
The second aspect of the question is, what can be made public? The commission has taken the position in a statement it issued on Friday, and either through coincidence or happenstance I had no knowledge of what the commission was saying on Friday when I was asked a question in the high school. Therefore, my comment was not on what the commission said, even though the Leader of the Opposition said it was published on Saturday. That is pure coincidence. I had no knowledge of what the commission was saying.
What I was saying to a group of students is that the ultimate responsibility in matters of security and in matters of privy council secrecy cannot be discharged by the government. It is an ultimate responsibility that we must bear. I still stand by that, but as regards the operation of the commission, I want to make it quite clear-as the Solicitor General has, as I have, and as former solicitors general have-that we will co-operate

in every way, as the commission says we have, and we do not see any disputes arising. If there are disputes, we will try to resolve them between us, as we have in the past.


John Edward Broadbent: Mr. Speaker, I did not, of course, say to the Prime Minister that the question of access was irrelevant to the broad consideration of whether the commission would be able to do its job. Of course it is relevant. I said it was irrelevant to the dispute. The Prime Minister has not clarified that in his answer to me. I should like him to make it very clear. The former solicitor general, Mr. Fox, assured the House that in matters to be decided-whether to be in camera, or not in camera-it was not the government that would decide whether it was on security matters, or other, but it was the commission.
I ask the Prime Minister, now, because according to the statement he made as quoted in the press on Saturday he certainly took a contrary position: is the Prime Minister now assuring the House, and therefore the people of Canada, that the commission will have the right to decide, even on security matters, after it assesses the information in advance, whether testimony or aspects of legal procedures are to be in camera or not. Is the Prime Minister going to say, in certain matters, that the government is still going to insist that it will decide?


Pierre Elliott Trudeau: Mr. Speaker, I am saying that I know of no case in which there has been a difference of opinion, in fact, with the commission.


An hon. Member:: Then what?


Pierre Elliott Trudeau: Therefore, the question is hypothetical about something which might happen down the road. Right?


An hon. Member:: No.


Pierre Elliott Trudeau: There has been no case of disagreement in terms of what should or should not be published. The commission makes that quite clear, and I repeat it. Therefore, in fact, there is no difference of interpretation about any specific cases.
About the hypothetical case in the future where the government would try to absolve itself of its responsibility-


An hon. Member:: Argued by your counsel.


Pierre Elliott Trudeau: -argued by our counsel, and argued by myself, that we do have the ultimate responsibility in matters of Privy Council secrets and in matters of national security, we will stand by our responsibility.


John Edward Broadbent: Mr. Speaker, I think the Prime Minister has made himself clear. He is now denying what the former solicitor general committed himself to in the House on the very day the commission was set up. The Prime Minister is saying that the government is going to be the judge of itself because of the fact that one of the purposes of this commission was to
October 16, 1978

investigate the possibility of cabinet wrongdoing, a possible illegal wrongdoing.
The Prime Minister is now asserting it is going to invoke the Nixonian document, that it is going to be the final arbiter in a case involving itself, which is totally unacceptable.


Pierre Elliott Trudeau: Mr. Speaker, not at all. That is not a question; it is a comment. If I can make a comment in exchange, it is not the position of the government that the leader of the New Democratic Party has stated. I have said that we have the ultimate responsibility. I went on to say that we will discharge that responsibility in every way we can to satisfy the commission. I have said in the past that we have succeeded in doing that. Certainly, if the commission finds some evidence of wrongdoing, fraud or crime by some high official, we will not hide behind the Official Secrets Act or anything else. We will find ways of declassifying documents and co-operating with the commission in the future, as we have in the past.
I am just saying that no doctrine can absolve the government of its responsibility for Privy Council secrets. There are cases where we do make those secrets public, and we have done so in the past. We could in the future, if the commission were to argue this was necessary.


TESTIMONY OF CABINET MEMBERS
John George Diefenbaker: Mr. Speaker, I believe in a simple question being asked of the Solicitor General, and I do so accordingly. There is nothing hypothetical about it. If a police officer-


Some hon. Members:: Oh, oh!


John George Diefenbaker: There is nothing hypothetical, because it is going to happen.


Some hon. Members:: Oh, oh!


John George Diefenbaker: If a police officer gives evidence to the effect that the instructions came from a minister of the Crown-and a minister of the Crown, naturally, will be called-will he be permitted to say whether or not he gave the alleged statement that the police officer indicates, or will he hide behind the Prime Minister's smokescreen?


Hon.   J.-J. Blais@Solicitor General: Mr. Speaker, that question is quite hypothetical. I draw to the attention of the right hon. gentleman that ministers of the Crown have been quite adamant in appearing before that commission and in making the evidence related to any of the matters quite open.


John George Diefenbaker: Hiding, as usual.
Oral Questions


SOCIAL SECURITY
Mr. Gilles Caouette (Temiscamingue):: 
Gilles Caouette: Mr. Speaker, on a supplementary.
As in several cases that is the only income those people have, what does the minister intend to do to solve their problem since she suggests the pension might be paid for a few more months? What about the following months until they reach 65; what are those people going to do?


Miss Begin:: Mr. Speaker, the hon. member is misleading the Canadian people through his question. Those people represent a number of spouses aged 60 to 65, whose mates, on retirement, have been receiving for three years only a supplementary pension in case of need. The real problem is not so much those people, but all the needy aged 60 to 65. We are now paying-and perhaps the hon. member does not agree with our way of going about it-hundreds of millions of dollars each year in taxpayers money in the form of global financing to the provinces, of which that of Quebec, precisely to help pay welfare benefits to those people. The hon. member would like a supplementary pension to be paid by the federal government; in other words, he is telling me that Quebec wants still more money from the federal. There already are programs through which those people get money, programs of which we contribute more than 50 per cent of the cost.


USE OF PENSION FUNDS
Gilles Caouette: Mr. Speaker, another supplementary.
80065-8S4

October 16, 1978
Oral Questions
I know very well that the federal government transfers fairly important amounts of money to the provinces. Is the minister certain that the provinces do indeed use those funds as intended?


Monique Bégin: Mr. Speaker, this question enables me to make a correction. I said "under the block funding system". Block funding applies only to social services; the amounts transferred under the Canada Assistance Plan represent exactly one half of each payment made to individuals and under the law it is impossible for Quebec or any other province to put that money elsewhere.


THE CANADIAN ECONOMY
Mr. John C. Crosbie (St. John's West):: Mr. Speaker, my question is for the Prime Minister. On Friday the thirteenth- a bad luck day for Canada-the Bank of Canada, with the consent of the government, raised the central bank interest rate to 10'A per cent. This is the fifth increase in seven months-a 28 per cent increase since March 9, and the largest single increase at any one time since 1935.
In view of the viciously damaging effects this will have on economic growth in Canada, can the Prime Minister advise the House what the government's plans are to overcome those damaging effects and to reach the 5 per cent growth rate that he promised at Bonn last summer? Will he tell us how the government plans to overcome the discouraging effects this will have on business investment in plant and equipment, already down this year, on small business and on construction? The whole truth is needed now. Is a budget going to be brought down now?


Mr. Speaker:: Order, please.


John Carnell Crosbie: What does the government plan to do to overcome these things?


Pierre Elliott Trudeau: Mr. Speaker, there was a great deal of commentary in that question. Most of it would have been solved for the hon. member if he had read what the governor of the Bank of Canada said when he announced this increase in the bank rate. He said very clearly, at a time when the dollar had been holding steady that day and, I think, even slightly improving, that he suddenly found himself faced with an American bank rate which had increased drastically, and therefore had narrowed the spread between the American and Canadian rates. He responded to that situation in the United States by creating a spread between them which had been reduced by the action in the United States. Therefore, it was not an action based on the performance of the Canadian dollar on that day or days, but it

was based on what happened in the United States: the governor said so in as many words, and I would refer the hon. member to his statement.
As to the question asked by the hon. member, yes, there will be a budget; the Minister of Finance has indicated that it will be brought down in the middle of November.


John Carnell Crosbie: Is the Prime Minister saying, then, when he refers to the statement by the governor of the Bank of Canada, that this was done because of the increase in United States interest rates, that Canada is now a prisoner of U.S. interest rates policy, that we no longer control our own monetary policy and that the government is content with that position? Is that the situation? Will the Prime Minister comment on that aspect?
Will he tell us, also, whether a statement is to be made on the present issue of Canada Savings Bonds which is obviously not likely to sell well at an interest rate of 8.9 per cent, with the central bank rate up to 10.5? When will new rates be announced for that issue?


Pierre Elliott Trudeau: I do not know whether the hon. member is serious in asking that question about our being a prisoner. He must have heard by now that Canada does not operate in a vacuum and that there are other countries in the world whose economic actions influence Canadian bank rates, and so on. There has been traditionally a spread between American and Canadian bank rates, as the hon. member knows or should know. What the governor says is that he is re-establishing that spread after the United States acted in the way it did.


John Carnell Crosbie: If he is not a prisoner, then, would the Prime Minister explain to the House how he intends to achieve the 5 per cent real growth rate he promised at Bonn; how he proposes to increase our business investment; how we are to improve the economy if the interest rate continues to go up and up? If we are not a prisoner, how is the Prime Minister going to demonstrate that we are not? When will he break these bonds and show us how he is going to bring the country forward economically?


Some hon. Members:: Hear, hear!


Mr. Speaker:: Order. I think the hon. member will recognize the argumentative nature of that last question.


CANADA SAVINGS BONDS
James Aloysius McGrath: Mr. Speaker, my supplementary question is directed to the Acting Minister of Finance, the President of the Treasury Board. Is it the intention of the government to withdraw the present issue of Canada Savings Bonds and reissue it in a more realistic form? If so, will a statement be made on this matter today, in view of the impact the present rate is having on the sale of these bonds
October 16, 1978

and the position in which people who have already bought this issue find themselves?


Hon. Robert K. Andras (Acting Minister of Finance):: Mr. Speaker, I will refer the question to the Minister of Finance under whose jurisdiction this matter properly falls.


James Aloysius McGrath: My final supplementary is addressed to the Prime Minister. Given the effect this increase in the prime interest rate will have on inflation and unemployment, particularly in areas which are already suffering from regional disparity, and since there will not be a budget for at least another month, what steps will the government take now to offset the disastrous impact of this increase of the prime rate on inflation and regional disparity?


Pierre Elliott Trudeau: We have brought forward many legislative measures which will directly affect all parts of the country, particularly those which include less developed areas, and I urge the hon. member to get on with voting support for them.


BANK ACT
Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, my question is addressed to the President of Privy Council in his capacity as House leader. Could the hon. gentleman advise us whether it is the intention of the government to give notice immediately of the first reading of the revisions to the Bank Act? Would he, at the same time, advise us when he will be ready to put a motion on the order paper referring the contents of that bill to the Standing Committee on Finance, Trade and Economic Affairs so that the committee might resume at the earliest possible date its interrupted hearings with regard to those revisions?


Hon. Allan J. MacEachen (Deputy Prime Minister and President of Privy Council):: It is the intention of the government to bring forward the revisions to the Bank Act very early in the session. With respect to the method of dealing with the bill, I would be glad to have the assistance of the hon. member and of other hon. members, as we did in arranging the procedure last session.


ROYAL CANADIAN MOUNTED POLICE
Mr. G. W. Baldwin (Peace River):: Mr. Speaker, I have a question for the Prime Minister arising out of the first question asked by the Leader of the Opposition in relation to the McDonald royal commission. Bearing in mind that the situation is not hypothetical, as can be seen from the nature of instructions given by the Solicitor General to his counsel and
Oral Questions
made public to the commission, obviously in anticipation of an attempt by government ministers to hide some information, I should like the right hon. gentleman to assure us that when a conflict arises between the government and the royal commission as to whether or not evidence is of a security nature, the government will not make use of the outdated and infamous doctrine of Crown privilege to hide evidence, as President Nixon used executive privilege in the United States.


Pierre Elliott Trudeau: That is a silly question, Mr. Speaker. If the hon. member had taken the trouble to read the statement by the McDonald commission, he would have seen that the commissioners themselves do not make light of what he calls Crown privilege.
It is recognized by anyone who operates in government, or who has any chance of operating in government, that there are some things that are of a nature to be concealed by the state. Let me just quote what the McDonald commission itself says on page 15: they are quoting from a case in 1968, Lord Reid, in the House of Lords: "I do not doubt there are certain classes of documents which ought not to be disclosed whatever the content may be." That is a very clear statement, and this has been a tradition of parliamentary government as long as it has existed. The hon. member pretends that this tradition, this legal doctrine, does not exist. It does-unfortunately for his case.


Gerald William Baldwin: Is the Prime Minister not aware that that statement by Lord Reid was related to a decision by the House of Lords that the court would make the final decision with respect to particular evidence, and not the government?


Pierre Elliott Trudeau: I am well aware of this case in 1968, but I wonder whether the hon. member is not now changing his whole argument. He is not saying that the McDonald commission should decide; he is saying that the courts should decide. That is exactly what he is saying now, and perhaps that is what the McDonald commission is saying. I see hon. members shaking their heads. Is that not what the hon. member for Peace River has said; that the courts would decide? That is what I am saying, too. There are some cases where privilege may or may not be involved, and it is for the courts to decide whether it is right or not.


Mr. Stuart Leggatt (New Westminster):: Mr. Speaker, my question is on the same subject and it is directed to the Solicitor General. The mandate which was given to the McDonald royal commission clearly provided, and I am quoting from it, for the commission to "conduct such investigations as, in the opinion of the commissioners, are necessary to determine the extent and prevalence", and so on. That mandate allowed the commission, in its own wisdom, to conduct whatever investigations it deemed were necessary.
Bearing in mind the Prime Minister's statement today, that he intends to continue to rely on the inherent privilege not to release Privy Council secrets-


Pierre Elliott Trudeau: I did not say that.

October 16, 1978
Oral Questions


Stuart Malcolm Leggatt: -can the hon. gentleman tell the House how the public will ever know what was withheld from it? How will the public ever know that executive privilege has been exercised in any particular case?


Hon.   J.-J. Blais@Solicitor General: If the hon. member would read the statement made by the commission, he would see at once that the commission intends to proceed in calling such evidence as it deems fit and to decide which of that evidence it wants to make public. At that point the commissioners will be receiving representations from counsel on behalf of the government and the Solicitor General. Undoubtedly, if the commission can make a statement such as it did on Friday, it will subsequently take measures as it deems fit with respect to any representations the government may wish to make.


Stuart Malcolm Leggatt: Given the fact that the entire investigation deals with matters of national security-the inquiry has been set up to look into this specific subject-and given the fact that the government continues to exercise its inherent privilege, my question is still a simple one: how can the public ever know whether that privilege has been exercised, or that there has or has not been a full investigation into this particular subject in view of the statement of the former solicitor general who said, "whether or not the commissioners would do it in camera or in public depends on the decision of the commission." Does the Solicitor General still stand by that statement?


Jean-Jacques Blais: Mr. Speaker, I have a great deal of difficulty following the mental processes of the hon. gentleman. However, as I understand it, the question is exactly the same as the one he posed to me initially: the reply, therefore, is still the same.


HEALTH AND WELFARE
Mrs. Simma Holt (Vancouver-Kingsway):: Mr. Speaker, my question is to the Minister of National Health and Welfare. Now that the head of the health protection branch has found that he erred in causing the hysteria and panic among Canadian diabetics and obese people that he did over his 1968 statements about cyclamates causing cancer in rats, can the minister tell this House whether the head of the health protection branch has indicated whether he will allow the minister and members of parliament to advise their constituents that this safe sugar substitute can be used in food and soft drinks?
Further, now that the head of the health protection branch considers cyclamates and saccharin safe for sale at the high price of medical exclusivity in drugstores, will the minister release them to the normal and less costly grocery store outlets?


Monique Bégin: Mr. Speaker, the recent findings of private laborato-

ries on the exact relationship between cyclamates and cancer have permitted the scientific community to determine the acceptable daily intake of cyclamates for humans, which we did not know some ten years ago when we first restricted cyclamates in order to protect people. Based on that new knowledge we are therefore permitting-and I issued a press release, I think last week-the use of cyclamates in prescription drugs only. The safe daily intake is too small, according to scientific knowledge of today, for me to take any decision to liberalize the use of cyclamates in all soft drinks and diet foods. I am not yet in a position to do that.


TRANSPORT
Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, my question is for the Minister of Transport. The coroner's jury inquiring into the Air Canada crash of last June on runway 23 in Toronto in which two lives were lost has recommended that the runway be extended over a creek at the end of the runway. I would like to ask the minister whether he is going to act on the jury's recommendation. 1 point out to him that the pilot stated that the runway is disastrous.


Hon. Otto E. Lang (Minister of Transport and Minister of Justice):: Mr. Speaker, as in every case of a coroner's decision and recommendations, we will look at these seriously, of course. At this point I do not have an analysis of the cost of the recommendation made in that report, and I obviously cannot make a judgment upon it without knowing that.


A. Daniel McKenzie: Mr. Speaker, the jury recommended that the runway be extended immediately. If the minister does not have the necessary funds at this point, will he be closing down the runway? The director general of civil aeronautics pointed out in 1976 that there are ten other airports in Canada which are not up to acceptable standards. Have these ten airports been brought up to acceptable standards, and will the minister be closing runway 23?


Otto Emil Lang: Mr. Speaker, the work of ensuring that airports are safe and that facilities are safe is ongoing. We take a very serious view of the matter, and I can assure the hon. member that in every case where there is any kind of limitation upon a runway or other feature at an airport which causes us concern, steps are taken. Those steps may include limitations on runways or other facilities. They are taken to ensure the complete and adequate safety of the travelling public. That has been done in this case, and if one compares our standards, our runways and our facilities with those in use in countries all over the world, one will find that ours come out very favourably indeed. I think that should be a real reassurance to the travelling public and I do not think we should be overly concerned about the way in which the hon. member has put his question.
October 16, 1978


INLAND SHIPPING-LABOUR DISPUTE INVOLVING MARINE ENGINEERS
Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker, I would like to direct a question to the Minister of Transport. My question involves 800 marine engineers who apparently could tie up the inland shipping fleet. I do not have to remind the minister what this would mean in terms of the movement of ore, grain, oil and coal. This matter affects some 2,000 members of the SIU. Can the minister bring us up to date as to the present status of this very important dispute? If these people go out on strike, the effects on the economy will be disastrous.


Otto Emil Lang: Mr. Speaker, I would like to make it clear that I could not agree more with the hon. member about the serious impact of a strike on the lakes upon many, many sectors of the Canadian economy. I think, as late as midnight last night mediators from the Department of Labour were attempting to work with the parties in order to resolve the dispute which is apparently leading to this shutdown. Later today I will be discussing this matter with the Acting Minister of Labour. However, I can assure the hon. member that the significant impact upon the economy of any prolonged shutdown will be very much on our minds as we look at the present state of play.


Lincoln MacCauley Alexander: Mr. Speaker, am I to understand, just as the Postmaster General has revealed, that the minister will accept his responsibility with respect to strikes and that he will act quickly and with a sense of urgency? This is what the Canadian people want to hear. Will this minister accept his responsibility and act quickly and urgently? As he has indicated, any strike will have disastrous effects on the Canadian economy. I think the minister knows what I am talking about.


Otto Emil Lang: Mr. Speaker, not only do I know what the hon. member is talking about; I said so just a few moments ago. The Acting Minister of Labour and I have been in very close touch with the parties in the final stages of trying to reach an agreement after a conciliator's report came down. We are fully aware of the seriousness as far as the economy is concerned and, in answer to the hon. member's opening words, I will say, yes, indeed we will continue to accept our responsibilities and attempt to make sure that damage is not done to the Canadian economy.


PUBLIC WORKS
Mrs. Jean E. Pigott (Ottawa-Carleton):: Mr. Speaker, my question is directed to the Minister of Public Works. The minister says he has thoroughly studied the files of two projects in Hull, Place du Centre and the Chaudiere project. Does the minister accept the finding of the national finance committee of the other place that in entering into these two lease-purchase agreements the department, with the approval
Oral Questions
of Treasury Board, failed to observe the cautions taken as a regular course in all other projects for the acquisition of space?


Hon. Judd Buchanan (Minister of Public Works and Minister of State for Science and Technology):: Mr. Speaker, that is certainly not my understanding. I was very pleased with this report. It zeroed in on several areas such as cost recovery, revenue dependency and the monitoring role of Public Works Canada, which I thought was extremely useful. However, on the question of the lease-purchase which the hon. member is raising, the committee compared our 35-year cost on these projects with five-year lease costs here in Ottawa and across the river in Hull, and on that particular issue I intend to take issue with the members of the committee when I appear before it some time early in the new year.


Jean Elizabeth Pigott: Mr. Speaker, I am glad that the minister agrees in certain areas, and I hope he will comment on the conclusion that "the economic benefits of these agreements were questionable". Does the minister agree that the decision to proceed appears to have rested on other than purely economic considerations?


J. Judd Buchanan: No, I do not, Mr. Speaker. As a matter of fact, I just indicated to the hon. member that I very much challenge that particular assertion. The rate of increase in this decade has run between 4.5 per cent and 10 per cent in lease rentals in this area. We have projections which show very clearly that on the basis of this, by 1983 we will be many millions of dollars in pocket on these particular lease-purchase arrangements. We think they are sound business ventures.


ROYAL CANADIAN MOUNTED POLICE
[Stage Direction]
McDonald commission-role of government counsel
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I would like to ask a question of the Minister of Justice in light of answers which have been given today with reference to the McDonald commission. As a basis for my second question I would like to ask whether Mr. Nuss and Mr. Robert act for the Solicitor General or for the Privy Council as a whole. I ask this in light of Mr. Nuss's argument to the commission on Friday and in light of the decision as to who is a compellable witness, what is enforceable evidence, what is admissible and what is irrelevant. Who do these two counsel act for-the whole Privy Council, or just the Solicitor General?


Otto Emil Lang: Mr. Speaker, generally speaking, counsel before the commission are acting on behalf of the government as instructed by the Minister of Justice in consultation with various departments. The role of the Attorney General is special and, of course, his position is special in relation to this, and I will reserve that.

October 16, 1978
Oral Questions


Eldon Mattison Woolliams: Mr. Speaker, it does not seem to be clear, in light of that answer. Before the commission, he said that he and Mr. Robert appeared on behalf of the Privy Council and that it was far from clear to them. We know what the commissioner's ruling was as to what is enforceable and compellable evidence. Since the commissioner thinks that it is far from clear, and if there is a dispute between what was said by the commissioner and the Privy Council, the government, is that a matter which will be decided by the courts, the commissioner or the commission?


Otto Emil Lang: Mr. Speaker, once again, the hon. member seems to raise a hypothetical question. The commissioner has observed how completely co-operation and argument before the commission has resolved all these issues. This is how we expect it to continue. Clearly, counsel for the commission is acting for the government. That is a unified whole and not a divided part, with the single exception of the very special role of the Attorney General. However, it should be clear that questions which arise before the commission as to such issues as witnesses or confidentiality will be argued before the commission and then finally decided before the commission. That is the general position we are taking.
There is no great point in looking at questions of ultimate responsibility and hypothetical situations. I think it is better for the general public to recognize that this commission will be operating, making its decisions, and will not be fettered in that regard.


PUBLIC WORKS
[Stage Direction]
LES TERRASSES DE LA CHAUDlfiRE-STATEMENT BY NCC VICE-CHAIRMAN
Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, my question is directed to the Minister of Public Works. It is prompted by the following statement of the vice-chairman of the National Capital Commission, Mr. W. T. Perks, which appeared earlier this year in the Ottawa Citizen:
The committee was not asked if this was appropriate.
This is with respect to Les Terrasses de la Chaudiere project. It continued:
What we were asked to do was tinker with something that was a fait accompli.
Could the minister explain how the Campeau project could have been a fait accompli in 1974, when the corporation's only holding in the entire six-block pole west area appeared to be a $100,000 option to purchase one property in one corner of the area involved?


J. Judd Buchanan: Mr. Speaker, this issue was discussed at some length several months ago when it was raised by the hon. member for Capilano. If my memory is correct, at that time I indicated that the contract was signed

some time in November of 1975. I will have to verify this. Thus, the comment attributed to Mr. Perks rather puzzles me-the comment to the effect that the matter was a fait accompli a year and a half earlier. It was not a fait accompli until the deal was finalized. At that time there was no question that the Campeau corporation controlled by far the majority of space in the proposed project. Again from my memory, it was somewhere in the area of two-thirds of the space involved in the entire project.


Elmer MacIntosh MacKay: Mr. Speaker, the entire matter continues to puzzle a lot of people. That is why we are attempting to get more facts on the genesis of the entire operation. Does the minister accept the following statement made by Mr. Robert Campeau in a letter to the standing committee on finance of the other place?
Patronage is always involved in the choosing of architects and other consultants for government projects.
Would the minister indicate whether Mr. Campeau's suggestion of patronage would extend, in his opinion, to paying without tender $15 million a year for 35 years for accommodation which, as the Senate report indicates, could have been obtained more economically by following established practices? It is rather an extensive package.


J. Judd Buchanan: Mr. Speaker, on previous occasions we have compared Crown construction, lease-purchase and straight lease. As far as comparison with Crown construction and lease-purchase, using the present value we came up with a difference of less than 5 per cent, which at that time we suggested was very much a judgment call. As I indicated to the hon. member for Ottawa-Carleton, even with a 3 per cent increase in rental rates-and we have been running in excess of that-we project that by 1983 we will be money in pocket on these transactions.


THE CANADIAN ECONOMY
Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, my question is directed to the Prime Minister: it arises out of an answer he gave a few moments ago respecting the increase in the bank rate. I understood the Prime Minister to say that this action was taken in order to protect the dollar. There have been four previous increases already this year which have resulted in increased consumer and small business loan rates, escalated mortgage rates and discouraged investment. Thus, economic recovery has been hindered.
Why does the Prime Minister believe that this fifth increase will be any more beneficial in protecting the dollar and stimulating the Canadian economy than the four previous increases?


Pierre Elliott Trudeau: Mr. Speaker, I was not expressing the opinion the hon. member indicates. I
October 16, 1978

indicated what the governor gave as a reason for increasing the bank rate.


Thomas Clement (Tommy) Douglas: Mr. Speaker, in view of the fact that supposedly there is a constant relationship between the Minister of Finance and the governor of the Bank of Canada, I can hardly separate the governor from the Government of Canada. The Prime Minister referred to the traditional formula of keeping a 1 per cent to V/2 per cent spread between Canadian and American interest rates on the thesis that the higher rate in Canada would attract foreign capital. Also, this discourages Canadian investment in equity capital and tends to direct it into loan capital. In view of those facts, can he tell us why it seems advantageous to the government to attract foreign capital, discourage investments by Canadian investors in their own business activities and direct them into loan capital?


Pierre Elliott Trudeau: Mr. Speaker, there would be two effects of the operation. Not only will it attract foreign capital but also it will prevent Canadian capital from going to seek higher returns in the United States and other countries. The effect of an increase in the bank rate is not merely to attract foreign capital, but to keep Canadian capital here. Once again, I am answering the general question of the hon. member for Nanai-mo-Cowichan-The Islands.
In so far as the actions of Friday are concerned, I repeat, as far as I know they were not made in response to anything but the actions in the United States. The behaviour of the Canadian dollar on that particular day did not call for that action. Apparently, it only came very late in the day after the American banks had acted.


AIR TRANSPORT
Mr. Allan B. McKinnon (Victoria):: Mr. Speaker, my question is directed to the Minister of Justice. As part of the settlement reached with the American securities and exchange commission, the Boeing Aircraft company admitted that in at least one instance it concluded dual agreements with a Canadian consultant, resulting in the payment of large sums of money to the consultant outside Canada.
Has the Minister of Justice requested assistance from the United States Department of Justice, and when can we expect charges to be laid in connection with these incidents?


Otto Emil Lang: Mr. Speaker, I have not looked at this matter since I returned to this department, but I will inquire as to its state. I presume my officials will have taken note of that. I should like to check it before replying more fully to the hon. member.


Allan Bruce McKinnon: Mr. Speaker, my supplementary question is directed to the Minister of National Defence. When this
Introduction of Bills
subject was being discussed in the House of Commons in March, 1977, the minister said the following:
Until there is evidence of impropriety, there is no point in holding a full-scale investigation ... However, my officials are making the files secure so that they are available, and all evidence of people who were involved at that time is collected-
Certainly there is evidence of impropriety at the present time, which impropriety has been known for over two months since the Boeing revelations. What have the results of the investigation been? Who is in charge of it?


Hon. Barney Danson (Minister of National Defence):: Mr. Speaker, at that time the issue was looked into, and we cannot find any evidence, record or indication of any impropriety involving Canadians or from Boeing itself.


POINT OF ORDER
Thomas Charles Cossitt: Mr. Speaker, I rise on a point of order in regard to a motion under Standing Order 43 which I moved last Friday, October 13, as reported on page 61 of Hansard. Subsequently it was drawn to my attention by the former solicitor general, the hon. member for Dollard (Mr. Goyer), that a remark contained in that Standing Order 43 motion could be open to misinterpretation with regard to himself. I should like, in all and complete fairness, to correct this situation immediately. The words in question were:
-that Jean Pierre Mongeau was supplying information to the then Quebec Liberal government's minister of cultural affairs on the Parti Quebecois while at the same time he was working with the Prime Minister's then principal secretary, Marc Lalonde, and the then solicitor general the hon. member for Dollard.
I should have said, Mr. Speaker, that Jean Pierre Mongeau was special assistant to the Prime Minister (Mr. Trudeau), working with the Prime Minister's then principal secretary, Marc Lalonde, but not in any way working in the office of the solicitor general of the time, the hon. member for Dollard.



ROUTINE PROCEEDINGS


Monique Bégin: for leave to introduce Bill C-2, to amend the Health Resources Fund Act.

October 16, 1978
Introduction of Bills


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

Allan Joseph MacEachen: for leave to introduce Bill C-3, to amend the Corporations and Labour Unions Returns Act.


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

Allan Joseph MacEachen: for leave to introduce Bill C-4, to repeal The Canada-France Trade Agreement Act, 1933 and The Supplementary Canada-France Trade Agreement Act, 1935.


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

Monique Bégin: for leave to introduce Bill C-5, to amend the Old Age Security Act.


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

Allan Joseph MacEachen: for leave to introduce Bill C-6, respecting the independence of parliament and conflicts of interest of senators and members of the House of Commons and to amend certain other acts in relation thereto or in consequence thereof.


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

John Edward Broadbent: Mr. Speaker, I rise under the provisions of Standing Order 26. Your Honour, I would say in advance that, whatever other considerations you may have had on this matter, I hope the opportunity for debate during the throne speech debate will not have been among them, because in this particular case, as Your Honour knows, it is the executive branch of government itself that is being called into question, and to rule in favour of the opportunity to debate this matter of fundamental importance to our system of government during the throne speech debate, while providing the opportunity for the executive to participate, would not, of course, obligate it to do so, and, given its past tradition, we could not expect it to enter the debate.
Having said that, I would ask leave to move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles), the adjournment of the House, under Standing Order 26, for the purpose of discussing a specific and important matter requiring urgent consideration, namely, the statement by the Prime Minister (Mr. Trudeau) made in Ottawa last Friday that it will be the government and not the McDonald commission which decides what matters or evidence are to be considered by the commission in public, the consequences of such a position being completely contrary to the integrity of the commission, which the commission itself recognizes.


Mr. Speaker:: Order, please. The hon. member for Oshawa-Whitby (Mr. Broadbent) has given the Chair notice of his intention, under the provisions of Standing Order 26, to seek a special debate on the subject he has now put forward.
In answering his preamble I would, of course, want him to observe with me that, even if his argument were to have the full weight he desires, he must recognize at once that he is perfectly correct in that the Chair has no power by which the executive, as he describes it, could be compelled to participate during the throne speech debate in respect of this or any other matter.
The hon. member will recognize at once, of course, that neither does the Chair have the power to compel participation by the same executive in any debate if I were to grant the motion under Standing Order 26. I am not sure that this advances the argument. In either case, members of the executive may or may not participate in any debate, as they see fit, whether the debate is under Standing Order 26, or in respect
October 16, 1978

of the throne speech. Therefore, the conditions seem to me to remain the same.
In any event, and this I suppose will be to the hon. member's regret, the fact is that the very paragraph to which he made reference in his preamble is one that does weigh upon the Chair in deciding whether or not the subject he is putting forward should be debated. Several days remain in the throne speech debate. It is, of course, a very jealously guarded right of any member that he may encompass during the course of discussion any subject which relates to the performance of the government, certainly over the past while, or as intended in the future. Therefore I would have to ignore totally the provisions of that subparagraph of the rule if I were to say on this day that we should set aside a particular aspect of want of confidence in the government in respect of one subject.
I must say that I am also concerned with another aspect, and that is that the Chair must decide whether the matter is urgent in nature. In so doing I cannot brush aside the fact that there is a very strong hypothetical tone to all of these questions that were put today. Everyone will have noticed that the Chair did not intervene on the ground that the questions put sought the intended stance of the government if and when in the future a certain event occurred before the royal commission. Those questions are, by their very nature, hypothetical, and certainly anticipate a situation in the future.
I did not interfere with those questions, for two reasons. First of all, a slight change in the form of the questions would bring them to a present consideration, that is, whether or not the government has formed any plans. In addition, I do not think the Chair ought to intervene where, in circumstances of this sort and of this importance, there is an obvious desire on the part of members of the cabinet to give answers, even though the questions do have a hypothetical tone, as was the case today.
However, I cannot ignore the fact that the statement to which reference has been made is a statement about intended conduct in the future. It has raised concern in the minds of members of the opposition, as expressed by this motion, that in the future the McDonald commission will request certain evidence to be given and members of the cabinet may take a certain stance opposed to that, or different from it.
This has been a matter of dispute today which is also difficult for the Chair. Even if this were not in dispute, the fact remains that the crisis to which reference is made in this motion remains in the future. Until the McDonald commission takes certain steps, and until the cabinet has made certain specific responses, upon which this parliament can focus, indicating that there is in fact a difference between them of a critical nature, I think it would be premature for me to accept the basic proposition that a crisis has been arrived at now which warrants the consideration of this rule, instead of at sometime in the future.
For the two reasons I have cited, I would indicate at this moment that I am not prepared to grant the application pursuant to Standing Order 26.
The Address-Mr. Roche


SPEECH FROM THE THRONE
[Stage Direction]
The House resumed, from Friday, October 13, consideration of the motion of Mrs. Ursula Appolloni for an address to His Excellency the Governor General in reply to his speech at the opening of the session, and the amendment thereto (Mr. Clark) (p. 27).
Mr. Douglas Roche (Edmonton-Strathcona):: Mr. Speaker, during the summer, three events occurred in Alberta that underscore why I come here with such pride as a representative from that great province.
First, in my own constituency of Edmondon-Strathcona we were honoured to receive the Governor General and Madame Leger who opened the Old Srathcona Foundation House which is dedicated to the preservation of our historical and cultural heritage in Strathcona.
Second, the city of Edmonton's performance in hosting the Commonwealth Games, a magnificent event seen around the world, revealed what a truly friendly and dynamic community we are.


Mr. Paproski:: Hear, hear!


Douglas Roche: Third, the opening of the Syncrude plant at Fort McMurray, a $2Vi billion project of tremendous complexity, is the leading edge of the economic shift westward in Canada today. All three of these events indicate the extent to which Strathcona, Edmonton, and Alberta as a whole, have been able to progress in all aspects of life, cultural, social and economic. Our life is enhanced by the accomplishments of so many Albertans, the films of Fil Fraser, the novels of the award-winning authors, Pauline Gedge and Aritha Van Herk, the drama productions of the Citadel, Walterdale and other groups. The 10,000 volunteers to the Commonwealth Games are a testimony to our quality of life.


Steve Eugene Paproski: Hear, hear!


Douglas Roche: With our vast resource base, we contribute substantially to the economy of all of Canada. As Canadians first, we Albertans are vitally concerned with the performance of the national economy, for it is only with a strong and vital economy that Alberta or any other province will realize its full potential. The story of Alberta today is one of growth and accomplishment. We are the new builders of Canada. We have the fastest growing gross provincial product in Canada. Per capita spending on education, health, and other social areas is the highest in the country. We have strength and potential and an attractive investment climate. That is why Alberta is now the financial centre of western Canada. Is it any wonder that we attract more than 3,000 newcomers every month, most of them fellow Canadians from other provinces looking for new opportunities?

October 16, 1978
The Address-Mr. Roche
One would think that the Prime Minister of Canada (Mr. Trudeau) would at least share in the pride of accomplishment of one of the provinces, but the Prime Minister is blind to Alberta. That blindness cannot be corrected, as a careful reading of his speech last Thursday in the throne speech debate reveals. Every reference he made to Alberta was negative. He had nothing good to say about a province that has been succeeding despite the policies of economic discrimination practised by the federal government. The fact is that the Prime Minister cannot stand any province, especially a strong one, standing up for its rights.
When the Leader of the Opposition (Mr. Clark) brings to this House his concern for the erosion of provincial rights, and we have certainly seen this in the government constitutional package, the Prime Minister tells him he should be sitting in a provincial legislature, not here. What gall! In that one remark, and his speech is full of examples, the Prime Minister revealed why he should no longer be in charge of Canada: he does not understand that regional growth and strength are what make this country.
The Progressive Conservative leader recognizes that the provinces are partners in confederation, not enemies. And he said clearly in his speech:
There will be times when I am going to have to assert national interests in ways that will not at all please the provinces.
Yet the Prime Minister, who seems to interpret co-operation as subservience, ignored this analysis because he cannot imagine an alternative to himself in protecting national unity. The Progressive Conservative leader knows intuitively that Canada is the sum of its parts; the Prime Minister continues to suffer under the delusion that Ottawa is the country. For the Progressive Conservative leader, the issue is ways to have Canada prosper in all regions, not just certain regions. For the Prime Minister, the issue is battling over who has power and jurisdiction.
In his leader's day speech, the Progressive Conservative leader presented economic and constitutional proposals to truly unite Canada. But the Prime Minister spent the bulk of his speech attacking the Leader of the Opposition and deriding provincial premiers. He has used his histrionic "zap" style once too often. For the Prime Minister, it is not jobs, inflation, the falling dollar, regional growth and national unity that are the problems; it is the man who sits 18 feet across the aisle in the House of Commons, the man whom Canadians are turning to as the next Prime Minister.
The present Prime Minister apparently cannot understand what has gone wrong. What has gone wrong, Mr. Speaker, is that he has lost the trust of Canadians. Under our democratic way of life, trust in government is absolutely basic. No nation can aspire to greatness if its government does not command public respect. "If the people can't trust their government," President Harry Truman declared, "the whole works will fall apart." We may or may not always agree with the decisions of government, but our system demands that we at least have confidence that the government is acting honestly.

Unfortunately, trust in the government of this Prime Minister has deteriorated so seriously that it has become the root cause of much dissatisfaction in Canada today. The cynicism toward Ottawa, found coast to coast, is traceable to the manipulation practised by this government. In fact the issue of trust in the leadership of our country has become the core issue of our time.
A long series of misadventures has characterized this government's decade in office; the Sky Shops affair, dredging contracts, phone calls to judges, questionable payments by Crown corporations, the uranium cartel, a blacklist of extraparliamentary opposition. We have learned to live with these shabby scandals and improprieties. But the government's own sense of morality has been undermined from within. Consequently a weakened commitment to principle for its own sake has infected the larger area of policy formulation. Here the examples become more serious.
The Prime Minister legislated wage and price controls after having campaigned in the 1974 election against them. He forced an abolition bill on the country when the majority of Canadians, fearing that violent crime is out of control, wanted capital punishment retained. Having divided Canadians by a heavy-handed application of the Official Languages Act, he tried to force upon parliament in the last months of his mandate constitutional changes, including diminishment of the monarchy, that are opposed by all ten provincial premiers.
Is it any wonder that people everywhere are asking, "Can Ottawa be trusted?" My answer is that the Ottawa of the present Prime Minister cannot be trusted. This is a government that once paid farmers not to grow wheat, that opened the door to 55,000 abortions per year in the name of "health", that made a welfare scheme out of unemployment insurance. This is the government that gave us LIP and a host of make-work projects that vanished in the night while undermining investor confidence in private industry which creates permanent jobs. And this is the government that attempts to abrogate energy agreements with Alberta, reneged on urban transit assistance to Edmonton, and refused the structural enlargement of the Edmonton international airport urged by the government's own engineers. The grounds for mistrust of the federal government are piling up all around us.
One principle is uppermost in the minds of the government-the principle of holding on to power. The fear of losing power is the reason Canadians have been denied the general election the country needed this fall. Now, in an effort to befog that public opinion, the Prime Minister talks of future referenda as instruments of direct democracy. In my judgment, the direct democracy Canadians want is an election now to throw out this unprincipled and untrustworthy government.
If the government really wanted to change its ways and promote national and economic social progress, it would pay attention to the legitimate evaluations made by Premier Lougheed concerning the Ottawa-Alberta relationship. In his address opening the new session of the Alberta legislature on
October 16, 1978

October 11, Premier Lougheed said that many Albertans look on the federal government "as an adversary rather than an ally." He also said:
Federal policies have been negative and not positive, for young Albertans... in terms of opportunity .. . We are no island here in Alberta. We're part of this country in the fullest sense of the word, and it's simply not possible for us to maintain our prosperity in the face of a sluggish or weak economy in the rest of Canada.
The overwhelming message coming from Alberta is one of frustration with the way the federal government handles federal-provincial relations. It is almost as if the federal government is trying to dig itself out of the economic mess by using Alberta's wealth. And in so doing, Ottawa is affecting Alberta's ability to plan its own economy.
The latest example of this is the attempt to delay the $1 a barrel oil price increase scheduled for January 1. A series of four increases in oil prices was agreed upon between the two levels of government in 1977. On August 1 of this year the federal government approved the last of the increases. By August 26 it had changed its mind, causing great confusion in Alberta. Now the throne speech says negotiations are under way to defer the increase. Is it any wonder that Albertans have become cynical about the government's intentions?
Alberta provides over 85 per cent of Canada's oil and 80 per cent of Canada's natural gas. The only way to bring about self-sufficiency in energy, which is in the national economic interest, is to promote vigorous development, with all the high cost technology that this entails.
Another significant example is the federal government's repeal of the Public Utilities Income Tax Transfer Act in the hastily conceived restraint program last summer. This act provides for a rebate to the provinces of 95 per cent of the federal and provincial income tax collected from privately owned utilities. It was designed to provide equal tax treatment between customers of these privately owned utilities and customers of publicly owned utilities which do not pay income taxes. Alberta is the only province to return this tax to the utilities in full. Repeal of the act will therefore mean increased prices to the consumer, an estimated $25 annual increase per capita.
Albertans, therefore, will be the ones most seriously affected because most of Alberta is serviced by privately owned utilities. Of the estimated $48.9 million which would have been transferred next year, Alberta's share is $33.9 million. Rather than a reduction of federal government spending, this move represents an additional taxation, and Alberta is the primary target. It will have a depressing effect on Alberta industries and agriculture, and will indirectly pass through to higher costs for all consumer goods.
Here we might note the so-called clout of the Minister of Industry, Trade and Commerce (Mr. Horner) on behalf of Alberta. When, as the hon. member for Crowfoot, pleading that he could do more for Alberta, he ran across the aisle in lustful pursuit of a Liberal cabinet post, we were told that Albertans would benefit. As the question period revealed last Friday, the minister had no impact whatsoever on his cabinet
The Address-Mr. Roche
colleagues when the Minister of Finance (Mr. Chretien) repealed the Public Utilities Income Tax Transfer Act. No one in Ottawa listens to the Minister of Industry, Trade and Commerce and, as he will find out shortly, his supporters in Crowfoot are becoming hard to find.
As for the Minister of Finance, his action continues the long tradition of doing business with Alberta: decide unilaterally, then consult. The Progressive Conservative way of doing business is: Consult first, then decide.
The Edmonton Chamber of Commerce put the importance of the utilities problem succinctly to the Prime Minister in a letter on October 4, as follows:
The future electric energy projects in Canada require large sums of capital and it can only be generated in a stable environment where the private sector can compete on an equal basis with provincially and municipally owned utilities. This proposed action is in direct contradiction with the announced intentions of your government to reduce the demands on government spending at all levels and discourages the long term planning of the private sector so vital to meet ever growing demands for power.
We are also concerned that this particular action seems to be slanted against Alberta, which province has the largest percentage of its utility services provided by the private sector. We feel that this can be construed as another in a series of actions made against the people of our province; moves which, in the Final analysis, will not be conducive towards the type of atmosphere in which the constitutional debate can best be held.
Incredibly, there was no prior consultation with the provinces before announcing the repeal of the act, or perhaps not so incredible when one considers this government's record over the past year. Sales tax cuts were sprung on the surprised provinces; expenditure cuts were announced without any consultation; constitutional amendments have been reserved for the federal government acting alone.
The western premiers' conference in April was sharply critical of the unilateral and intrusive way in which the sales tax cut was initiated. The joint communique states:
The federal budget directly contradicted the spirit of federal-provincial cooperation and consultation which the February conference (of First Ministers) had been intended to foster and could be prejudicial to ongoing discussions on national unity.
At the February conference, Premier Lougheed called upon the federal government to recognize that its existing policies had not worked and needed to be significantly altered. This required, he said, "not only a change in policies but also a distinct change in attitudes." What the premier was looking for was new economic directions which would help all of Canada to "begin to move ahead again with renewed confidence."
He summarized the Alberta viewpoint on the formulation of a national economic policy as follows: First, the private sector is where the jobs are really created and where the multiplier effect is; second, we have to control the public sector in this country in terms of wage and salary settlements; third, we have to eliminate duplication in levels of government and within governments themselves; fourth, we have got to do more in our country, and press the media to do more,-to recognize the achievers and the doers in Canada today; and fifth, the real key to strengthening the Canadian economy is to encour-

October 16, 1978
The Address-Mr. Roche
age private sector risk investment by developing a climate that is encouraging.
This is also the view of the Progressive Conservative members of parliament from Alberta. For years we have been saying in this chamber that national unity depends on the economic strengthening of all regions and cannot be obtained by linguistic policies alone. We share Premier Lougheed's conviction that a stronger Alberta, and a strengthening of all provinces, are good for a united Canada. The leader of the Progressive Conservative party and the Progressive Conservative premiers have been working together to develop a common approach. But, of course, anyone is out of step except the Prime Minister who marches to the lonely beat of the Ottawa drummer.
Despite the call by the premiers for a co-operative approach, the federal government brought in yet another budget that distorted provincial economic and fiscal priorities, and it proceeded unilaterally with constitutional reform.
Premier Lougheed has rightly noted the deterioration in good relations between Ottawa and Edmonton as a result of the federal government's heavy-handed approach. Recently he said:
We have been making some progress in Alberta and it was in the best interests of Canadians working together with the federal government and other provinces, but we can get pretty disturbed, as we are today, with a series of steps that have occurred in the last number of months-of broken agreements, of tax discrimination towards our province. It is as though they said, 'Well, let's cut Alberta down to size.' There is also a continued intrusion in all provinces and a constitutional bill that literally throws down the gauntlet.
For telling the truth, for standing up to the federal government, Premier Lougheed is derided in this House by the Prime Minister. Instead of belittling the Premier of Alberta, the Prime Minister should be pointing to Peter Lougheed with pride. In Alberta we know that Premier Lougheed is a great Canadian. And Alberta will not tolerate the undermining of this sterling advocate of co-operative federalism.
Let it be said clearly for the nation to hear: Alberta is committed to Canada. In the Alberta Speech from the Throne in March, Lieutenant Governor Steinhauer ably expressed this when he said:
Our citizens are fully committed to a strong and united Canada. The flexibiity of our federal system should prove to be our strongest asset as a new federalism begins to evolve. Alberta will continue to play a leadership role in strengthening the unity of our Confederation.
What Alberta wants to see in any constitutional change is the promotion of Canadian unity, the achievement of the aspirations of the new west, a strengthening of the position of the provinces, and the safeguarding of the traditional and historic rights of the provinces, particularly with regard to natural resource ownership.
The Prime Minister notwithstanding, the message of the real Alberta is starting to be understood in central Canada. I congratulate the Hamilton Spectator for its editorial of October 5 which commended Premier Lougheed for opposing
[Mr. Roche.)
greater concentration of political power in Ottawa. The editorial noted:
The fact is that the economic advance of Alberta is good for all of Canada, very good. And the development of more political power on the prairies would also be good for Canada. Ideally all the provinces from Newfoundland to British Columbia should share Alberta's aspirations and confidence.
What Canadians are looking for is a healthy and hopeful society. We must recover a sense of purpose for our country. The world needs our vigorous participation in economic partnerships.
This past summer I went around the world on a foreign policy mission and I saw the opportunities, and the challenges for Canada in a changing world. We are closing our eyes to problems and opportunities for Canada abroad because we are so beleaguered at home on the economy and national unity questions. We must solve our internal problems so that we can get on with a constructive and responsible role in the modern world. The recovery of trust in Ottawa is essential in this process. Canadians desperately need effective, co-operative leadership, not more political confrontation. Only in this way can our country express fresh recognition of the basic values in life, such as truth, honesty, and decency, that never change.


Some hon. Members:: Hear, hear!


Hon. Alastair Gillespie (Minister of Energy, Mines and Resources):: Mr. Speaker, I welcome the opportunity to participate in this debate in reply to the Speech from the Throne. Particularly I would like to compliment the mover and the seconder, the hon. member for York South (Mrs. Appolloni) and the hon. member for Verdun (Mr. Savard), both of whom gave strong and articulate statements. I was most impressed with the statement made by the hon. member for York South, a colleague of mine who comes from the same region of Canada. Hers was a thoughtful, warm and compassionate statement, not surprising to those who know her as a warm, compassionate, and concerned Canadian.
I was less impressed with the speech which I have just heard made by the hon. member for Edmonton-Strathcona (Mr. Roche). He has made a number of good speeches in this House and we have listened to many of them with great admiration. This was not his finest hour. Indeed, for a man who is espousing the cause of Canada, it seemed to me to be a speech which was aimed at fanning the flames of resentment and building upon a sense of alienation in the west. I know that alienation is there. I grew up in the west, just as the hon. member did. I probably sense it as well as most people in this House.
I was not impressed when the hon. member used his position as a member representing a very important part of the country to fan those flames and suggest that somehow or other we were not treating one province, the richest province in this country, the same as the others. There was a suggestion that we were trying to take advantage of Alberta through tax discrimination, and I think tax discrimination was the phrase he used. We have introduced tax measures which affect the province of Alberta and its citizens, but those tax measures have been
October 16, 1978

introduced to assist them and other Canadians to develop the resources of Alberta for Albertans, in fact for all Canadians. I am referring to the new measures which were introduced this past year with respect to depletion allowances and other measures aimed at bringing on the tar sands and the heavy oils.
The hon. member referred to the Syncrude project, that gigantic national resource which was formally opened this year, a Canadian first by any standard. But he did not mention that it was only made possible because the federal government provided a particular kind of tax treatment for that project, because the federal government moved in to help salvage the project along with the Alberta government. It was in fact a combined enterprise of the federal government, the Alberta government and the Ontario government which, without the assistance of these governments, would not have taken place. That was not the cast of his remarks. The cast was of grievance, of resentment, of dividing, not building. As I say, it was not his finest hour.
I quote the words of the Governor General in the Speech from the Throne where he stated:
1: Urgent Action Needed
Parliament begins today a new session which will concentrate upon Canada's two most pressing needs. They are the strengthening of our economy, and the renewal of our federation.
Those two inseparable imperatives are different expressions of the same goal: to strengthen Canada through unity: to unify Canada through economic strength.
I do not think we are going to find the clues to those particular policy directions in the sentiments stated and unstated that I listened to in the speech made by the hon. member for Edmonton-Strathcona.


Mr. Whelan:: No way.


Alastair William Gillespie: The two themes of strengthening the economy and of strengthening our country and confederation were themes which were picked up by the Prime Minister in his memorable speech last week.
I would like to add another perspective, a perspective as the minister responsible for energy policy, because no policy area seems to me to be more important to these two objectives than the energy policy area.
Quite simply, our economy, economic security, future economic growth, and future prosperity as Canadians will depend upon adequate and reliable supplies of energy at competitive prices.
Second, our sources of energy and our consumption of energy are often thousands of miles apart in this country. Nowhere is the economic and political interdependence of the regions of Canada more manifested than in the energy policy areas, areas of production, transportation and consumption of oil, natural gas, coal, uranium and hydro power. However, it has not always been that way. That has not always been the perception in Canada.
The Address-Mr. Gillespie
As recently as five years ago, Canadians were unconcerned about security of supply. That was hardly a word that we heard in the lexicon of Canadian economic policy. That was the time when we felt we had lots of cheap energy. The issue was not security of supply. The issue then was: how do we get the United States to take more of it?
That perception started to change in 1973 when the OPEC nations raised the price of oil four times and the Arab OPEC nations decided they would embargo the greatest nation in the world, the United States, that they would cut off supplies to the United States.
Quite clearly, the Arab nations, which produce most of the oil in OPEC, gave the Americans and the industrialized world two simple messages. The first was that the era of cheap energy is over. The second was just as important a message. It was that in the future "you would be unwise to count on us for your energy needs." There have been other events since 1973 and 1974 which have tended to highlight the insecurity of supply to the western world and to Canada.
Venezuelan production, for example, has been declining. The government of Venezuela has decided to cut back on its oil production. There have been some big finds such as the North Sea, Prudhoe Bay, and re-examination of the Mexican reserves, but not many other significant big finds. Big finds have been rare.
At the same time there has been an increasing perception that the technical producibility of existing wells is going to peak within a very few years. The World Energy Conference in their book entitled "World Energy, Looking Ahead to the Year 2020" published in the last few weeks by the Conservation Commission of the World Energy Conference, covered the input of thousands of experts from dozens of countries around the world for a period of three years. It contains the best estimates in the industry, in the countries, the bureaucracies and the universities. It is the most comprehensive that I have seen to date. It indicates that the producibility of world oil reserves will start to decline very shortly after 1985 at a time when the world will continue to be increasing its demand for oil.
During this period of time, as well, we have seen social unrest and tensions between countries in the Middle East start to increase. I refer, of course, to the tragic events in Lebanon, and the assassinations in the two countries to the south of Saudi Arabia, South Yemen and North Yemen, to the events on the Horn of Africa, to the internal events in Iran, to the almost silent takeover from a non-Marxist regime to a Marxist oriented one in Afghanistan, to the PLO, and to the Arab-Israeli conflicts. There is a whole pattern of instability in the Middle East, the centre of the greatest source of world oil.
During this period of time we have also noted a stiffening resistance on the part of Saudi Arabia, the greatest oil producer, to continue its production of oil. This view was put forward again when Ahmed Zaki Yamani, the petroleum minister of mines and resources of Saudi Arabia, was in Canada this summer.

October 16, 1978
The Address-Mr. Gillespie
I have taken a few minutes to put this matter in context. I think it is important that the security of supply arguments be understood by Canadians and all sides of the House. During this period of time, of course, the perception also changed in another very important respect. That was that Canada was no longer a net exporter of oil. Canada had become a net importer. Quite clearly the sense of urgency with respect to security of supply has increased very quickly and very substantially.
Quite simply stated, the major population centres of central and eastern Canada were perceived to be vulnerable as never before. Approximately 50 per cent of the primary energy source of this part of Canada is supplied in the form of oil. That oil has been increasingly imported oil. Without that oil, our economy will not function. Indeed, it will literally run out of gas.
During this period of time there has also been confusion among some people about gluts. There have been temporary gluts because of the Prudhoe Bay find and the discoveries in the North Sea. However, they are not going to answer our problems. The new discoveries in Mexico may help to buy a little time, but that is all they will do, because these discoveries together probably do not add more than a few years to the consumption pattern of the world.
That confusion continues to bedevil the energy policy formula in this country, as it did in the United States. However, there are other reasons for putting this in context, not just for Canadians to appreciate the importance of the issue but to understand the initiatives the federal government has taken and, indeed, to challenge the official opposition to come forward with their own policy positions in these important areas.
As I go through the rest of my remarks there will be a number of cases where I will want to challenge them to respond to important energy issues facing this country at the present time.


Steve Eugene Paproski: We will after the next election.


Alastair William Gillespie: The hon. member says they will tell us after the next election. Judging by the kind of statements his leader made in the House on leaders' day, I think we can expect more. He invited Canadians and members on this side of the House to expect more. He invited us to expect that he is prepared to put his party's position forward on these issues.. We have been waiting a long time to hear from him on some of these issues. We hope we will not have to wait very much longer.
The issue of energy policy is not whether there will be a shortage, nor is it when will that shortage occur. The issue is, given our opportunities and the urgencies facing us, what can Canadians do? What can we in Canada do to protect our own interests, our own economy, integrity, and the interdependence of our own country? What can we do to develop our own energy resources?

We are very fortunate as a country. We have options which most countries lack-large resources in western Canada, in the Arctic and offshore. We believe there is a major role for private industry to play in finding and developing those resources.
We also believe there is a role for the national oil companies in various countries. We believe there is a role for the Canadian national oil company, Petro-Canada, to play in the exploration and development of Canadian resources. But that is not the position of the Leader of the Opposition (Mr. Clark). The Leader of the Opposition has clearly stated that he would invite the national oil companies of other countries to come to Canada to look for Canadian resources and develop them, but that he would not permit the Canadian national oil company to do so. He made it clear he would dismantle Petro-Canada. Mr. Speaker, that is an absurd position for any thinking Canadian to take. It would be absurd the eyes of any foreign thinking government.
Can you imagine the President of France saying, "Well, I wonder whether the national oil company of France" which is presently exploring off the coast of Labrador, "would be able to form a joint venture with the Canadian national oil company in the same area in which it is now operating?" Would he not be bound to conclude that were the Conservatives to form the government he would have to find a multinational partner or deal with the oil company of another nation but that he could not deal with a Canadian company in the development of Canada's national resources?
If some other government, for example, the British government through BP, or the German government through its own company, wanted to get into the development of the vast tar sands of western Canada, they could not do so by dealing with a Canadian national oil company; they would probably have to deal with the national oil company of Japan which has already made an application to work out a joint venture with the Canadian national oil company, Petro-Canada.
I think Canadians will increasingly ask what is wrong with having a Canadian national oil company develop our resources. Why would the Leader of the Opposition not wish Canadians to participate in the development of our own country?
I should like to deal briefly before the lunch break with two other important developments which have taken place since the House rose last July. I should like to deal first of all with measures to reduce the inflationary impact of oil price changes, and to follow this with some comments on the measures we have taken to develop security of supply of energy resources for Canadians in the future.
I wish to refer particularly to measures we have in train with respect to certain major capital projects referred to in the Speech from the Throne. I wish to touch on the importance of maximizing eastern Canadian markets in particular for Canadian natural gas as a means of reducing dependence upon foreign imported oil. I should like to deal as well with the
October 16, 1978

program which was introduced in connection with the development of solar energy, an important program which has a strong Canadian orientation looking to the development of Canadian industry and using Canadian firms. This program is in marked contrast to the one which was trotted out-that is probably the most charitable way of putting it-some months ago by opposition spokesmen, a program which seemed to be more concerned with providing tax credits to persons who have installed solar heating some eight years ago than in dealing with the future or with the development of the Canadian industry; nowhere was a preference given to the development of solar systems by Canadians, which is in complete contrast to the approach taken in my party.
The measure to reduce the excise tax on gasoline by three cents will have the effect of enabling consumers to pay a price for gasoline which would be lower than otherwise. It is a measure aimed at trying to contain the price escalation which we became increasingly concerned about as it approached double digit figures. It is aimed at all Canadians.
With respect to the oil price change on January 1, I should like to spend a minute or two discussing the implications, but I shall probably have to do that after the lunch break. However, I want to make it clear that the agreement we have reached with Alberta with respect to the oil price increase on January 1 was conditioned by the level of prices in the United States. Our position was that we have to protect the competitive position of Canadian industry, as well as move prices up in an orderly way to ensure that development will take place and take place expeditiously. We do not think there will be sufficient head room on January 1 for a price increase to take place, but we are saying that in any event we believe it is in the national interest that the price increase should not take place at that time.
Mr. Speaker, I should like to call it one o'clock.


The Acting Speaker (Mr. Turner):: It being one o'clock I do now leave the chair until 2 p.m.
At one o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.
The Acting Speaker (Mr. Turner):: At one o'clock the Minister of Energy, Mines, and Resources (Mr. Gillespie) had the floor, with eight minutes remaining.


Alastair William Gillespie: Mr. Speaker, I would like to spend just a moment to recap some of the themes of my earlier remarks. I had been talking about the importance of security of supply. This is a relatively new concept as far as Canadian perceptions are concerned. It is important because we have received a message from the oil exporting countries that we cannot continue to count on their supplies. They are, quite clearly, not prepared to guarantee an ever increasing amount of oil for
The Address-Mr. Gillespie
Canadians and others. We are a net importer of oil, not a net exporter of oil. We have very substantial resources in Canada which we should be developing and, so far as possible, developing ourselves. Yes, we should be developing those resources, with the help of others when we can, and developing those resources by ourselves when we can.
I pointed out that a number of other free enterprise countries around the world also recognize the serious security of supply problem, that they have developed national oil companies to assist them in obtaining security of oil supplies, that many of those national oil companies are active in Canada in an exploration and development way and in some cases in a production way as well, and that the Canadian government formed Petro-Canada to assist in the exploration and development of Canadian resources.
Petro-Canada has been very active in the Arctic and in the offshore. Indeed, last year one half of all the wells drilled in the Arctic and offshore areas of this country were drilled with Petro-Canada participation. However, the position of the Leader of the Opposition is that he would keep those foreign national oil companies in Canada and dismantle the Canadian one. He would go further than that; presumably he would invite those national oil companies which are not now in Canada to come to Canada, but he would dismantle the Canadian national oil company. He would have no answer for the governments of other free enterprise economies when they would say to him that through their national oil companies they would like to deal with the Canadian national oil company in Canada for their purposes and for Canadian purposes.
He would have no answer because he would already have announced, if not already dismantled, the dismantling of the Canadian national oil company. This is a ludicrous position to Canadians. One might also observe that it is a ludicrous position to those outside Canada who would want to do business in Canada. They would ask why the leader of the country, which the Leader of the Opposition hopes to be, has so little faith in Canadians that he would not be prepared to maintain and develop a national oil company as other countries have done for their own security?
I went on to point out very briefly that other free enterprise economies are also heavily involved in the exploration and development of uranium. I referred to Germany, Italy, France, and Spain. Yes, there are companies in Canada with very heavy British government investment as well. There is one national Crown corporation, Eldorado, in which the people of Canada, through the Government of Canada, have an interest. That too, however, is something which the Leader of the Opposition would dismantle or peddle. He has not yet told us how he would deal with it, but he would get rid of it. He seems unable to put Canadian interests first.
It is questionable whether the Leader of the Opposition is a captive of an earlier dogma of the Conservative party or whether he has been talking to interests, perhaps in the uranium industry, who would like to make a bid for the most profitable of the Canadian Crown corporations.

October 16, 1978
The Address-Mr. Gillespie
I was about to go on to the oil pricing question. I want to provide a little background on this because the pricing of oil has always been a trade-off of a number of conflicting interests and objectives. Canadians will remember that we did not move immediately to the international price for oil in 1973-74. Instead, we decided to move up in measured but orderly steps toward world energy prices. We did so because we were concerned about the impact on the economy of such a massive change. We were concerned as well about ensuring a competitive advantage, where possible, for Canadian industry. The Conservative party has yet to state its position with respect to this pricing policy for oil.
As much as possible we have tried to reconcile the interests of the economy, on the one hand, by a pace of change toward international prices which will be slow enough to minimize any adverse impacts, and particularly to contain inflationary pressures. On the other hand, however, we have also tried to move fast enough to produce a favourable conservation impact and favourably stimulate the exploration and development of oil and other petroleum resources in Canada and, as much as possible, to limit budgetary requirements, because the subsidy which has been paid under this program has amounted, or will amount, to better than $5 billion by the end of this fiscal year. This is the subsidy which has been paid-because we import; we are not a net exporter, we are a net importer of oil-to hold down oil prices in a very large section of the country.
We felt that there would not be sufficient head room, that is to say, the difference between the Canadian average price and the American average price would be less than one dollar come January 1-so we took the position that there should not be a one dollar increase come January 1, a position which had been fully discussed and negotiated. Indeed, it was one of the conditions of the oil price increases negotiated a year and a half ago with the producing provinces that if there is not that head room, that there should not be a price increase. In our view there will not be that head room.
We have gone further: we have said that in any event we think it is in the interest of the national economy not to move up that one dollar come January 1. We believe this is a responsible position for the Canadian government to take. We would like to hear from the official opposition, which has been silent on that, as it has been silent on many important and contentious issues. Can the official opposition put its own particular regional concerns behind the national interest?
There are some major capital projects which we hope to complete during the life of this parliament. I am referring, for example, to the Maritime Energy Corporation. Negotiations are continuing favourably, although one must recognize that there are two new leaders in those provinces at the present time, as well as the fact that the third province is involved in a general election. That particular project is important to the maritimes and Canada. It will have to wait just a little longer for fruition. I am hopeful we will be able to bring it off with the cooperation of the leaders of those three provinces. Simi-

larly, the formation of the Lower Churchill Falls Development Corporation in conjunction with the province of Newfoundland has moved along well. We should be in a position to announce the formation of the corporation very soon.


The Acting Speaker (Mr. Turner):: I regret to interrupt the hon. minister, but his allotted time has expired. He may continue with unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. James Gillies (Don Valley):: Mr. Speaker, I wish to join with the right hon. Prime Minister (Mr. Trudeau) and the hon. Leader of the Opposition (Mr. Clark) in congratulating the mover (Mrs. Appolloni), and seconder (Mr. Savard), for their very fine statements in the House the other day. I was delighted to listen to what the Minister of Energy, Mines and Resources (Mr. Gillespie) had to say, as well as what he neglected to say. Particularly I am pleased that he did not make a forecast about the prospects for the Canadian oil and gas industry. Ever since the government has been in power, we have received nothing but different forecasts. Every time the minister speaks, the net result is that we are more confused about the situation.
I was not astonished to hear a restatement in ringing tones of the commitment of the Liberal government that the enterprise system cannot solve the energy problems of this nation. It is a commitment for more government and bigger government all the time.
Many Canadians must find it absolutely incomprehensible that the energy policy of Canada should be one based upon the principle of self-reliance, rather than the principle of self-sufficiency. Surely if we learned anything during the OPEC crisis, it was that we must move as rapidly as possible to this position of self-sufficiency in energy. We are one of the few countries in the world which is capable of achieving a position of self-sufficiency. We have the largest known proven reserves of oil. We have larger proven reserves in our oil sands than the Middle East. It is a measure of the failure of the government that we are not self-sufficient in the production of energy.
I should like to speak for a moment on the contents of the Speech from the Throne and the participation of the Prime Minister the other day. The Speech from the Throne was most unusual and disappointing. Unlike most occasions when the government uses the Speech from the Throne to outline plans for the forthcoming session of parliament, and the participation of the Prime Minister to fill in the details, the government provided us with little vision, and practically nothing was said about the plans for governing this nation during the next year. Moreover, the Prime Minister used his time not to elucidate and expand, but to defend, explain, attack, and condemn, to the point where anyone listening to the debate would think that the Prime Minister had assumed already his position as leader of the opposition.
Perhaps the unusual nature of the government's performance can be explained by the fact that the House of Commons
October 16, 1978

is a political arena as well as a forum for governing, and that we are in the last stages of parliament before the calling of an election. Under such circumstances, the last gasp attempts of a Prime Minister to absolve an administration which is dying, and which, like a sick animal, should be put out of its misery as soon as possible, are understandable. Given the fact that the nation is looking for leadership, is aching to have confidence in its institutions and wants to know what plans this interim government has, clearly there has been a mammoth political miscalculation on the part of the government and the Prime Minister in abdicating the responsibility for providing leadership and offering hope to the people of the country.
Defence of the past is not what the nation is looking for. It is plans for the future and solutions to problems which people are looking for, and deserve to have. Politicians who have been on the hustings during the last few weeks and months know that at the present time Canadians are somewhat fearful of their future. They are distrustful of the inability of their institutions to solve the problems of the day. Probably faith in politicians is at an all-time low. For the Prime Minister to use one of our time-honoured occasions, to attack the opposition, not to put forward ideas and not to say how the government will operate in the forthcoming session, is an additional indication of the inability of the government to lead.
As unusual and misguided as the tactics of the Prime Minister may be, they are understandable at this time in our history. However, what was missing from the Speech from the Throne and the elucidation of the Prime Minister was an appeal and a challenge to Canadians to look at problems as opportunities and to have confidence in their nation. An omission such as this is inexplicable and unforgivable.
I had occasion to look in Bartlett's famous quotations for noteworthy contributions in the House of Commons, and found only the one made by Sir Winston Churchill in the Canadian House of Commons during World War II. Perhaps it is un-Canadian to provide the nation with any resounding statements of aspirations-I do not know. But if ever is a time when Canadians are looking toward the government for leadership, surely it is now. Where in the Speech from the Throne, or in the contribution by the Prime Minister, can an equivalent of John F. Kennedy's ringing declaration of his first inauguration be found? Mr. Kennedy said:
Ask not what your country can do for you but what you can do for your country.
At a time like this, Canadians have a right to expect such statements in the Speech from the Throne or from their Prime Minister. Where can an equivalent of President Roosevelt's comforting words in his first inaugural address be found? He said:
The only thing we have to fear is fear itself.
Or the words of Sir Winston Churchill when he said:
Do not let us speak of darker days; let us speak rather of sterner days.
Surely the essence of leadership is to be able to use the language in a sentence, to infuse the hopes and aspirations of a nation. Is there no one in the office of the Prime Minister who
The Address-Mr. Gillies
is capable of putting together such statements in order to distil for Canadians the leadership they require?
I would not suggest that we only need more rhetoric or more studies. What we really need is action on the pressing problems facing us. Warren Bennis has pointed out in his study entitled "The Unconscious Conspiracy: Why Leaders Can't Lead" the following:
Nothing ensures the status quo so much as putting the best minds and best talents to work diligently on blue ribbon task force committees. For their reports continue to get better as our problems get worse.
In this session of parliament we do not need more studies and more commissions. We require urgent action on parliamentary reform, economic reconstruction, and constitutional reform. We need to get on with the tasks we have been elected to perform-to provide a legislative framework within which people can live with freedom and opportunity.
We got nothing innovative and nothing new from the Prime Minister in his rambling speech. One expected and hoped for much more, because every Canadian who has been following our history knows that the Prime Minister has recently turned his personal attention to the economic problems of our time. This was dramatically illustrated on August 1 when, on his return from Bonn, he personally took hold of the economic management of the country, apparently without extensive consultation, some would say with no consultation whatsoever, with his officials or his colleagues, appearing on national television to announce the new economic policies of the government.
What was indeed lacking and threatening in the speech he made here, which we thought would develop the details of that statement made on television on August 1, was that the government, it is clear, has no fundamental grasp of the interrelationship between the various economic activities that go on in a nation and the need for an interrelated series of policies to solve them.
Unfortunately in his remarks in the House the Prime Minister said absolutely nothing to alleviate the fears of those who believe that economic policy-making in this country has collapsed, that the government has no program for dealing with the problems of high unemployment, has no program for dealing with high inflation, has no program for dealing with the low value dollar, and has no program for approaching the crisis in confidence which is apparent around us.
Indeed, the entire economic portion of the Prime Minister's speech, a speech which was awaited with keen expectation by people both inside and outside Canada so that they could assess the government's plans, was not a speech at all. Instead, it consisted of citations and recitations of statistics which appear to come from OECD press releases, and which were well orchestrated to demonstrate that the Canadian economy was probably outperforming any other economy in the world.
There was no awareness that 900,000 Canadians are out of work, no awareness that Canada has the second highest inflation rate of any industrialized nation of the world, no aware-

October 16, 1978
The Address-Mr. Gillies
ness that the dollar is selling at about 84 cents, no awareness that there is an outflow of capital going on in an unprecedented amount, and no awareness that the general attitude of the people in Canada is that the economy is completely out of control.
It has been long held that statistics can be used to prove anything, and that maxim was never given a greater testing than last Friday when the Prime Minister spoke. How irrelevant to take ten years of statistics to demonstrate, I am not sure what, when we have these problems before us at the present time! How devastating that the Prime Minister, who has taken over and is in charge of economic policy making at the present time, appears to believe that the recitation of statistics for a ten-year period has any relevance whatsoever with what we have deal with in this parliament at the present time!
There is no debate in Canada at the present time about the goals of economic policy making. All parties believe that what we want in this nation is reasonably full employment and relative price stability. What we do have a debate on is how to get there.
The New Democratic Party is convinced that the traditional Keynesian policy of spending more is the way to solve our unemployment problem, to spend our way into prosperity, and if there is something less than full utilization of capacity in our nation, and a short-fall in investments, the government should take up the difference and in this way solve our economic difficulties.
The problem is we know that this, what has become the truly traditional approach, is not working any more, and it has not worked since 1972. The only way that public investment of a greater amount can be financed in Canada at the present time, with the present state of Canadian capital markets, would be with a greater deficit. The government could not finance a greater deficit at the present time and, therefore, would have to print more money. We know that in the structure of the economy we have now, and with the conditions we have now, the only thing that would happen with the printing of more money would be more inflation, and with more inflation there would be less investment, and with less investment there would be more unemployment.
The fact of the matter is that the policy advocated by the NDP, appropriate as it might have been for 1936, and as appropriate as it might have been for some cyclical slowdowns in 1950, is simply inappropriate and would not work under the circumstances we have at the present time. It is somewhat sad to me that a party which has been in the forefront of reform many times would propose such old fashioned, outmoded propositions to deal with our economic problems at the present time. They are almost as unworkable as the nationalization of resources which they have preached since the time of the Regina manifesto.
Unfortunately an analysis of the positions of the present government is more difficult because they are so incoherent one does not really know what they are intended to accom-
[Mr. Gillies.)
plish. Again, the goals are clear. We want to bring about reasonably full employment and relative price stability, but how do we do that?
The government seems to say that what it wants to do is cut, at least in planning if not in reality, its spending plan. Presumably the reason for doing this is to instil confidence in investors, lower the deficit, and slow down the rate of inflation. But at the same time the government raised interest rates. Last Friday it raised interest rates to the highest in this country since, I think, 1934. The result of raising the interest rate is to create unemployment because it slows down the rate of investment. This is exactly the opposite to what the government said it was trying to do with its budget cuts.
The government's stated budget cuts are highly irrational. The government has said, for example, that it wants to increase exports. Our advantage in exports is in respect of many of our basic resource industries. The government cut expenditure on research and development. It has cut expenditures on research in the fishing industry. It seems just incredible it would do this after spending several years negotiating a 200-mile limit in order that we could exploit fisheries. The government now cuts research in that area just when we need it so badly. It has also cut expenditures for research in respect of forestry products and in other areas where we must continue to develop efficient and effective methods if we are going to be able to increase our exports. This makes no sense whatsoever.
There has been no rational explanation on the part of the government as to what kind of deficit it wants. What is the appropriate deficit, the appropriate fiscal stance for this country during the next few years-the next five years, for example? How will it be funded? There are no explanations because there is no policy. Moreover, the government does not seem to have any understanding whatsoever of the fact that a deficit results not only from extravagant government spending but also from a decline in revenues.
The government does not seem to understand that one of the ways to increase revenues is by cutting taxes, strange as that may seem to some. The evidence is in from all over the world now that if you have an intelligent tax cut program which stimulates economic activity your revenues will increase. This has been pointed out by Professor Laffer, and it has been supported by the fact that when President Kennedy adopted tax cuts in the United States in 1960 he converted a federal deficit of $4 billion in 1961 to a surplus of $8 billion in 1965. The government has no policy on taxation in an attempt to stimulate the economy so that revenues will grow again.
The policy of the government in respect of the management of the dollar is so puzzling it defies explanation. Everyone knows that the credibility of this government has been weakened, almost beyond recovery, by the way in which the Minister of Finance (Mr. Chretien) has handled the decline in the value of the dollar on foreign exchange markets.
Certainly it is clear, in an economy such as Canada's, where we have 27 per cent of our gross national product generated by foreign trade, compared to 6 per cent in the United States, that whatever happens to the dollar has an immense effect on
October 16, 1978

domestic inflation and on employment. It is simply impossible to make economic policy to achieve full employment and price stability without having a policy about the dollar. Every time our dollar goes down one cent against the American dollar, we have four-tenths of one per cent change in the inflation rate in Canada. Are the Minister of Finance and the Prime Minister trying to tell us that the government has no position with respect to the dollar, that any level of the dollar is satisfactory for the making of economic policy in this nation? This is absolutely ludicrous.
If our goals are to have reasonably full employment and reasonable price stability we must have a policy with respect to the value of the dollar. While the government argues that we are increasing our exports through the devaluation of the dollar, it should never forget that this is a very short-run gain. The last country that used this policy for any extensive period of time was Britain, and everyone knows what happened to the British economy from the period 1955 to 1965. In short, because of domestic inflation effects, the advantages that are gained in the export market by the devaluation of the dollar are soon wiped out.
I do not propose to argue today, because it is not the time or place, the merits of a fixed exchange rate versus the idea of a floating rate. Many economists believe that the great depression of the 1930s was caused because of fixed exchange rates when economies were held to the gold standard. Certainly after World War II, when ministers of finance of the world met together at Bretton Woods, it was determined that they would operate with a much more orderly international market. The reality is that the Bretton Woods program for handling international stability is no longer viable. Countries are breaking away from it, and we need new approaches.
Part of that new approach is for countries to demonstrate that they have an understanding of the interrelationship of their currency, if it is an open economy as in our case, and the economic policies that they are trying to propose. For the Minister of Finance of Canada to say that where the dollar is, is irrelevant to economic policymaking in this country, is doing nothing to achieve any gains in this direction. In short, elementary as the lesson seems to be, this government does not seem to understand the monetary, fiscal policy, that is, spending and taxing, and its exchange rate policy, must be integrated and they must work together.
Over the past few years we have experienced exactly the reverse. On the one hand the government does something on exchange rate policy which increases unemployment, then it does something on fiscal policy to decrease unemployment. Then it puts up interest rates by half a per cent, which lowers employment. There has been absolutely no program whatsoever. It is as if from day to day the Mad Hatter, from Alice in Wonderland, were making economic policy in this nation, a policy which can best be summed in Churchill's phrase that the government has, "decided only to be undecided, resolved to be irresolute, adamant for drift, solid for fluidity, all powerful
The Address-Mr. Gillies
to be impotent". It is the best summary one can make of economic policy making at this time in this nation.
The agony of the current economic situation is that it is unnecessary. Canada is a rich country, probably one of the richest in the world in terms of resources and potential. Remember that when the OPEC cut off energy from industrial countries, Germany and Japan did not have any oil at all, and yet they managed to have enormous recoveries and strong economic performances. The only thing we have succeeded at in the past few years is failing.
Why would that be true, Mr. Speaker? Well, there are many reasons. Part of the failure flows from the general inability of the federal government to work constructively with provincial governments toward mutual solutions of problems. Part of it is clearly in the inherent contradictions in the constitution, written 111 years ago, which gives the strong taxing power, and therefore the largest source of revenues, to a central government, but leaves in the hands of the provincial governments the expensive things to pay for, health, education, and welfare. Part of the problem comes from an acceptance on the part of the government in power of spending programs that it has no way of financing and the naive belief that the economy will constantly grow. This is probably based on the euphoric notion that economic growth will always be with us no matter what we do, and possibly in part on a failure to realize that what is a right economic policy for one period may, indeed, be the wrong one for another. Of all these reasons, the latter is often forgotten.
We have been a country locked in policy making based on the programs Lord Keynes developed in and for the 1930s. John Kenneth Galbraith, in his essay "How Keynes Came to America", points out that of all western industrialized nations the most Keynesian is Canada. Tragically, our policy makers have never realized that in a diverse nation such as Canada, with the great differences among our various regions, we need a different approach to our economic policy making. The essence of policy making in this country during the last few decades is that, by changing general tax policies and general expenditure policies, we can achieve the growth we want to have. Under certain circumstances this was true, but in a nation such as ours it is not always true, and it is not true now.
In this country economic policies must be made on the basis that if we make the components strong the total will be strong. What we need to do in this country, and this is more than lip service to some sector analysis, is to have a real belief that if we want to have full employment in Canada and want to have price stability we must be certain that the various sectors of the economy are prosperous. That means doing for the fishing industry what we have to do to make the fishing industry prosperous and doing the same thing for agriculture, manufacturing, and small business. When they are prosperous the nation as a whole will be prosperous. We can no longer go along with the budget making which I have seen in the six years I have been here, where every single budget has been based upon a false perception. Until that changes, we are going to have serious difficulties in this nation.

October 16, 1978
The Address-Mr. Gillies
To solve the economic problems of this country we need not be limited by lack of knowledge. Economists have been much maligned during the past few years, and perhaps properly so. But new economic theory is not needed. What we must have is the political will to do those things which must be done to turn this economy around. We must begin the task of economic reconstruction and development, not only for the obvious reasons of creating the wealth which is available to Canadians, but as a cornerstone for solving our social and constitutional problems.
This country this year is maintaining its record as being among the top one or two countries of the world in the number of days lost through industrial strife, and I wonder why. There are many reasons, but surely one of the most important must be the latent discontent with the management of the economy as a whole. People know, and their common sense tells them, that this is a country that does not have to have high levels of unemployment and inflation, that we should not have underutilization of our resources. They know when they hear of inflation rates of less than 5 per cent in Germany and other industrialized countries, and when they hear of situations where there is full employment of resources in other countries, they know that it does not have to be this way. They know that there has been mismanagement at the top and, they have become discontented and are determined that they will get their share. If they have to strike to do it, they will do it. They are disillusioned and quite willing to question the very social structure of our nation and the way our institutions operate.
That is one of the main reasons why we have so many strikes and lose so much production in this country. It has been said before, and I am sure it is true, that the alienation of the nation is immense. All we have to do is remember that in the province of Quebec we have an elected government that is dedicated to the proposition of taking the people of that province out of confederation. One only needs to go west to see the alienation all the way from Thunder Bay to the Pacific Oceah.
Why should that be, Mr. Speaker, in a nation endowed with the resources and history that we have had in this country? Part of it, as I have suggested, is because of the fact that the economy is not working the way it has previously, and part of it must lie in our constitutional difficulties.
If there is one thing that we must do in this parliament it is to bring in institutional reforms so that we can make parliament operate more effectively. Solving our institutional problems will not mean that all our problems will be solved. They will not, but we must make an attempt to do so and create understanding on the part of all Canadians.
I am speaking for myself but I sense that, particularly among my French Canadian friends, there is often a feeling that those of us not from the province of Quebec may not understand, may not care about what happens in that province. I would remind them, with the best spirit in the world, that the greatest study ever made of American democracy in the 19th
[Mr. Gillies !
century was done by Thomas deTocqueville who did not live in the United States. The social consequences of the policy of the United States of America toward blacks was written by Gunnar Myrdal, a Swede, in his book "The American Dilemma" in 1936. Those of us not from Quebec can also understand the problems of Quebec. I know my colleagues in this party and the leader of this party are bringing insight and understanding to the aspirations of the people of Quebec, even though they may not live there.
I would implore all sides of the House, particularly those responsible for developing policies and constitutional changes, not to ignore what might be said by those who may not come directly from Quebec, because we care, Mr. Speaker. I am sure we care as much as they that this nation survives after 111 years-


The Acting Speaker (Mr. Turner):: Order, please. I regret to interrupt the hon. member for Don Valley, (Mr. Gillies), but his allotted time has expired. He may continue with the unanimous consent of the House. Does the hon. member have unanimous consent?


Some hon. Members:: Agreed.


James McPhail Gillies: Thank you, Mr. Speaker. These are the days for the forecaster of the apocalypse. People as disparate as Robert Heilbronner in his book "An Inquiry Into the Human Prospect", or William Simon in "A Time for Truth", or Richard Goodwin in his analysis of the future of the United States, are saying that the democratic system as we know it is not going to survive unless people have confidence in their institutions.
The institution of parliament is a product of 111 years of history in Canada; it is a product of our history and of what we do, but every institution is also the sum of the people who are in it. I cannot subscribe to the theory that those of us who are privileged to be members of this institution of parliament cannot, in this period of crisis in our nation, make this institution work in such a way that we can solve our problems. Surely we do not want to leave this place thinking that we have not done everything, regardless of our political pursuasion, regardless of our personal interest, to make sure that it rises to the challenge presented by the Canadian people today.


Some hon. Members:: Hear, hear!


Gilles Caouette: Mr. Speaker, it is with pleasure that I welcome this opportunity to speak on the Address in reply to the Speech from the Throne, and I want to join the others who have spoken so far to commend the mover (Mrs. Appolloni) and the seconder (Mr. Savard) who did outstanding work.
What can readily be said about the Speech from the Throne is that is is a heap of old statements made by the right hon. Prime Minister (Mr. Trudeau) outside the House and before the Speech from the Throne, which really comes down to two main points only, that is, first lower government's spending
October 16, 1978

and, second, the constitutional change being proposed by the government. Apart from that, the most important problems are not mentioned. The economic problem is not mentioned. So we waited for the Prime Minister's speech to see if he could at least explain the Speech from the Throne and make it clearer. Unfortunately, we witnessed a two-hour attack against the Leader of the Opposition (Mr. Clark), but we were not offered any valid solution, any precision as to the attitude taken by the Prime Minister or the government concerning the remedies to be applied to the problems we are now confronted with.
The Prime Minister spent some time asking us to review his scholarly knowledge when he was speaking about experimental and rational psychology and he said that in his opinion the human brain has three different faculties: memory, imagination and intelligence. Lie said the Leader of the Opposition does have some memory despite a few mistakes, that he has plenty of imagination, but as far as intelligence is concerned, it is lacking in his speech.
I think Canadians in general will find it easy to agree with me here and that they recognize that the Prime Minister is indeed an intelligent man. But the fact is his administration lacks imagination and above all memory. The fact that once again the government has increased the rate of interest by three-quarters of one per cent two days after the Speech from the Throne is evidence of a lack of imagination because that was the fifth time the government did that since January. It is a lack of memory as well because such a move has always had the same results. Each time the government thought it would help our economy and each time it has caused a surge in inflation and unemployment.
The Prime Minister had just noted in his speech that the chairman and chief executive of the Royal Bank, Mr. McLaughlin, says we should not be too pessimistic, that things are going fine. If I were the chairman of the Royal Bank, I would certainly have said the same thing. When the government increases the rates by three-quarters of one per cent, the bankers feel allowed to raise theirs by 2 per cent or 3 per cent on the loans they will make. In their place, I say that there is no reason to be pessimistic. But people, the individuals who tomorrow will have to pay 15 per cent interest rather than 12 per cent on their loans, they have grounds to be pessimistic. And the Prime Minister is telling us: things are not that bad, the unemployment rate is going down.
According to Statistics Canada and the latest figures published on October 10-they are always a month old-as of September 16 then, the number of people receiving unemployment insurance benefits had indeed diminished. That is true. On the other hand, what they fail to add is that in some areas like mine, in northwest Quebec where we had 20 per cent of our people unemployed last summer, the unemployment rate
The Address-Mr. G. Caouette
went down to 16 per cent. Some will say: things go better, there are fewer unemployed! There are indeed fewer people who receive unemployment insurance benefits. On the other hand, there is the working population, the percentage of those on the labour market, not the population generally but people working, those who are on the labour market and looking for work. In my area, some 57 per cent of the people indeed are working which means that 43 per cent are unemployed, 16 per cent of whom are drawing unemployment insurance. Consequently, some 30 per cent are unemployed and do not receive any unemployment insurance. Where are they? Are they on social welfare? Is that a valid and buoyant economy, as suggested by the Prime Minister? I would say that we are right in the midst of a depression, but the Prime Minister's response is to say that the Leader of the Opposition lacks intelligence. That was his response in his speech.
In Quebec as a whole, we find 10 per cent unemployed 30 per cent of whom do not draw any unemployment insurance. Can you say then that the economy is booming that business is is thriving and that those who will be compelled to borrow and pay 15 per cent in interest will be happy while the Canadian economy will be expanding? No way.
The lack of imagination and memory of the government squeezes the worker more and more while allowing financiers to tighten their hold on him. Anti-inflation measures which we have lived with were aimed at limiting salary increases for individuals. Lor instance, in my riding and in three others throughout the province of Quebec, when Molson Company employees obtained wage increases, the Anti-Inflation Board came forward with a study and said to these employees: You are not entitled to those higher wages. And then they forced the employees to reimburse the company. That is what the government sitting in front of us is all about! Yes, I say they forced the employees to hand back to the company the increases they had obtained but at the same time this very company was allowed, as were other breweries, and this by order in council, to increase beer prices on the market.
Imagine! They authorize an increase for a big company and afterward crush the worker, even forcing him to give back the increase he has received. This is what the present government has done! What corrective measures have been proposed in the Speech from the Throne? None! Again there is some talk about reductions. In a letter addressed to the provincial premiers, the right hon. Prime Minister informed them of his decision to reduce public spending by $2 billion. But where does he intend to make those cuts? First, we are told that a personnel reduction affecting 5,000 jobs, will take place at least progressively. Will that affect big companies or the financial world? No. The workers will have to bear the consequences of the reduction of 5,000 jobs.
As I have said earlier, high finance has been allowed to boost interest rates. If this is how the Prime Minister wants to cut back $2 billion in government expenditures, I could sug-

October 16, 1978
The Address-Mr. G. Caouette gest to him other ways of saving this $2 billion. My colleague, the hon. member for Abitibi (Mr. Laprise), asked a question concerning the decrease in language training, since 477 Francophones will lose their job in the public service here in Ottawa. The minister's reply was that we had to try and please the other provinces. But we also know that the Liberal party is not very strong in the other provinces. So here are some gifts, because we all know that elections are coming. That is the reason for staff reductions in the areas of language, bilingualism and French positions.
The minister also replied: There is no demand for it. Yet we know that there are 2,000 applications for language training. Still, the minister has the indecency to tell us: There is no demand for it, so it is logical to cut back. Yet, at the very same time the decision is made to do away with 477 of those jobs, we find that some officials of the department are in the process of negotiating contracts with the Berlitz school of languages to give those same courses. That is the attitude of the present government: it would have us believe, on the one hand, that it is reducing the staff to cut down on expenses while, on the other hand, planning additional expenses in another field. We have often seen it happen.
We saw it in the budget of the Minister of Finance last March with regard to the sales tax; we were told that the people would be given goodies, that is a cut in sales tax. After ten weeks of debates in the House of Commons, it was finally discovered that the federal government was giving out $100 provided the provinces increased their own taxes by the same amount. That is making politics on the backs of the provinces. That silly little budget that was brought down at that time offered Quebeckers $85 and $100 to the other provinces. Do you know that, overnight, that increased the national deficit by $11 billion? Do you know that, overnight, the interest on the national debt was being increased by $2 million a day?
When the Prime Minister talks about cutting government spending by $2 billion, my suggestion is one Social Crediters have always made: that government be financed through interest free loans from the Bank of Canada based on Canadian and not American production.
At noon, questions were put to the Prime Minister on the increase of three quarters of one per cent announced last Friday by the governor of the Bank of Canada. The Prime Minister, having no memory, as I suggested earlier, and particularly no imagination, still had the audacity to answer that it was not to solve Canada's economic problem that the governor of the Bank of Canada had decided on that course of action. It was in reaction to the U.S. attitude. Who are the bosses in Canada? Is it the government? Is it Canadians or Americans in front of whom the Minister of Finance (Mr. Chretien) stands on all fours as well as the Prime Minister, as he did this morning? It is the rate increase-and it is a reaction-and it is not a solution to the economic problems, that we know. It is a reaction to the American attitude. That is

the attitude of the government now-flat on all fours before the Americans. That will not solve the problem.
Inflation, government members say, is beyond our control. They are not responsible for it. It is due to the Arabs who increased the price of their oil. It is due to other countries from which we import. We have called many times for a reduction of imports. Then we are told that we must have a trade balance. During that time we, stupid Canadian taxpayers, have to support that policy and reduce our production at home to maintain imports to please other countries and destroy our own production.
I am coming back from the riding of Lotbiniere where an election is under way and a number of furniture industries are closed or must reduce their operations. They are operating at 30 per cent of their capacity. During that time we in Canada bought in 1976, $177 million worth of furniture products from the United States, that is the attitude of the government now. In the footwear industry it is the same thing. For three years we have proposed footwear imports. Finally, the government accepted last winter to impose a quota on imports. Recently the Minister of State (Fitness and Amateur Sport) (Mrs. Campagnolo) took delight in sending every member in this House a letter informing us we had an invitation from the Bata Corporation. They started making sports shoes, which used to be made here, except that the industry was completely destroyed by imports. We welcomed at that point such a step, notwithstanding the fact we had been requesting import curbs for three years. In the other areas, beef, ham, butter, the same thing goes. We are getting millions of pounds of imports from other countries, while we are destroying our own production. Such is the government's attitude. It solves nothing. Neither the Prime Minister nor the throne speech bring any solutions for that.
As I said earlier, the budget brought in by the Minister of Finance in March increased debt interests by $2 million a day with an $11 billion deficit increase. This is no joke. When the Prime Minister tells us government spending is to be cut by $2 billion at the expense of public servants, do you not feel it would make more sense to reduce government expenditures at the expense of financiers, who go on rising their prices, their interest rates instead of saving $2 billion? If tomorrow the government decided to do their own financing, if they financed provinces with loans without interest, this would mean that tomorrow the government would be saving $18 million a day we are paying in interests only on the national debt. And our debt is increasing by $20 million a day. This is not a joke. These debts must be paid by the taxpayers. Canadians have to pay $18 million a day for the bad administration of the government. Do you know that instead of saving $2 billion Canada would have saved $6.7 billion by the end of the year? We could let the Prime Minister have his $2 billion and redistribute the other $4.7 billion in the small business sector to give it a new life, to create employment and to create other production levels to replace those that have been destroyed.
October 16, 1978

Earlier, the Minister of Energy, Mines and Resources (Mr. Gillespie) said that this would help the import of foreign capital, the development of new gas deposits, the establishment in Canada of multinational companies to develop our natural resources and perhaps job creation. There may be some value in having foreigners invest in Canada, but as long as we do not have ourselves the means to buy the production of those machines, what have we gained?
We should therefore start by giving some purchasing power to the individuals. The Conservatives laughed ten years ago when the Social Crediters demanded tax reductions. They found this laughable, but today they are the ones who are demanding what we requested then, who are demanding a tax reduction so as to give a new impetus to the economy and increase individual purchasing power. If I have $5 more to spend, these $5 will certainly result in an additional production, and if all Canadians have more money to spend because they have fewer taxes to pay, they will certainly create a demand for new production, and this will necessarily result in new jobs or a demand for new jobs. This is how we can solve our present economic problem, not by continually allowing inflation to multiply.
It is not necessary to be a genius or an Einstein to understand that if I buy a house tomorrow morning at 5 per cent interest a year, it will take 20 years before the price of my house has doubled. You do not have to be a genius to understand this. If I purchase the same house at 10 per cent interest, its price will be doubled in ten years, which means that in 20 years, it will have increased fourfold, and after this you ask where inflation comes from? The Prime Minister says it does not depend on us but on the Arabs, that we are not responsible. We know that the Liberals are irresponsible, we know that. But when we come to pay 12 per cent, it takes ten years, and then eight years to double the price of a house and soon, next week probably, you will see the rate go up to 15 per cent, which means that it will take six and a half to seven years to double the price of a house. And we ask where inflation comes from? And we do not know where it comes from?
At the present time, because of its approach the government multiplies, creates that inflation; through its policy it allows the Bank of Canada to raise its rates, thereby enabling chartered banks to boost theirs on consumer loans and increase the pressure on the Canadian people to reduce their expenditures. At 15 per cent, people begin to be far less inclined to build themselves a house than before. How much is a $30,000 house going to cost them after 25 years? $89,000! We wonder where inflation comes from just like we wonder about energy. The Minister of Energy, Mines and Resources talks about the problem of energy. We can see little stickers everywhere on the walls saying "Save energy!"
We still encourage the massive consumption of energy in our cars and heating systems. I raised the issue in 1973 when I was the member for Charlevoix in the House of Commons; I asked the Minister of Energy, Mines and Resources: Before talking about an energy crisis, a shortage of raw materials or a
The Address-Mr. G. Caouette shortage of oil in the years to come, at least did you go to the patents office in Ottawa to enquire about the registration of any patent that might reduce gas consumption in our cars or oil consumption in our heating systems? The minister gave me the following answer: No, we did not. This was not interesting. They said to Canadians: Tighten your belts, we are going to increase the price of gas in an attempt to reduce our oil purchases, but we cannot protect the individual or protect our resources by reducing energy losses, it is impossible.
In 1956, as I was 16 years old, I was driving an old wreck. A mechanic had fixed my carburetor so that my old wreck was going 65 miles a gallon, Mr. Speaker. I am' not joking, 65 miles a gallon until that mechanic applied for a patent. The RCMP came and said that the system was dangerous because it was using preheated gas. At that time, I did not know exactly what it meant but I finally discovered that in all planes the fuel is preheated before it reaches the engine. It is not dangerous in a plane with 300 passengers but it is dangerous in a car.
Today, with catalytic systems on cars people are no longer allowed to go anywhere near oil companies' lands as the oil tank 150 feet away might explode because of the high temperature of the converter under the car. That shows how this government is prepared to accept anything: It allows companies to encourage excessive gas consumption in cars so that they make money with such dangerous gadgets as catalytic converters. That is the attitude of the government. Then they come to tell Canadians: You are wasting energy. There are little stickers on walls saying: Turn off the lights, do not over-heat yet at the same time the government does nothing, not even to market patents which have been duly registered in the patent office and make their use mandatory. My predecessor in the riding of Temiscamingue and the House of Commons, Mr. Real Caouette, had been asking in those days for competitions to be held throughout the country for technicians and engineers to find ways to reduce consumption so as to save energy.
One must not penalize individuals but allow them to put their brains to work to find means and solutions to improve everybody's lot. The present government does not see it that way and all it intends to do is to penalize Canadians while putting the blame on others. If there are problems, it is never its fault. It is not responsible for inflation. It is not the government which allows the Bank of Canada to decide anything, it is the United States, the real bosses are the United States. The government has been elected for the fun of it. It has no decisions to make. We have just been treated to a Speech from the Throne in two parts: cutbacks in government spendings and, second, the constitution. It is true that there is a problem of unity in Canada. I listened earlier to the member for Don Valley (Mr. Gillies) expressing his views on the Quebec issue. He was referring to books written in 1936 and dealing then with the American issues and also with Latin America. As to the problem of Quebec, and also Canada in answer to the member for Don Valley and to government
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October 16, 1978
The Address-Mr. G. Caouette members I would say that in my opinion it is neither a language issue nor a constitutional problem. Indeed the constitution creates frictions but tomorrow I do not know of any Canadian who is going to want the constitution to become his daily bread.
I never heard about one single family going every week to the corner store to buy a new constitution, never. The problem is the right to live honestly and honourably here in Canada. In our provinces it is also the right to live honestly and honourably. That is what Canadians want. Unfortunately, in Quebec many Canadians do not even earn enough money to eat two decent meals a day. The Minister of National Health and Welfare (Miss Begin) said so herself before a group of students recently. There are 600,000 poor in Canada now. They do not even have enough money to eat two decent meals a day. We must admit it, there are people in Quebec who are unhappy, that is true. They do not even have enough money to eat two decent meals a day in French, in Quebec. Is it not terrible, in French, Mr. Speaker? I went to western Canada, on the Vancouver docks where I saw poor people; I went to the maritimes where I saw poor people there also. In Ontario, I went to regions where I also saw poor people who do not have the means to eat two decent meals, not three, we are used to talking about three meals, but here it is not even three, but only two decent meals a day. In other provinces, it is funny, people speak English, it is not terrible? And there are poor people among the English, it is terrible, it is horrible. Is it a language problem? Is it a constitutional problem? It is like I told you: be it in English or in French, nobody wants to eat constitutions, never! Poor people want enough money to go and buy food, for example. That is the problem. It is an economic problem that could be solved by giving to everybody a sufficient income to meet personal needs.


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


Stanley Howard Knowles: D'accord.
[ Translation]


Gilles Caouette: I thank you, Mr. Speaker, as well as all my colleagues. I have only a few more words to say.
Indeed there is a solution to that issue and we should not continue a confrontation between Canadians and we should not say what the Prime Minister said the other day in his speech about the Leader of the Opposition capitulating before the provinces. What we need is a strong government. But we cannot build a strong government without opposing each other. That is not the way. You do not build by confronting people and telling them to toe the line.
A good father does not spend all his time arguing with his children and saying to them: I am the boss and you will do as I say. However, if you have a conciliating father who is prepared to listen to any one of his ten or twelve children or to consider

their needs, I am sure that father will raise a friendly and peaceful family. Anyone who spends all his time confronting his children or his colleagues will surely have the results we have in Canada: discontent in the west, dissatisfaction in central Canada as well as in Atlantic provinces. In his speech, the Prime Minister failed to indicate the solution, and in introducing again Bill C-60, he wants to maintain confrontation.
To conclude my speech, Mr. Speaker, in spite of what government members have to say, the Speech from the Throne does not contain any new or valuable suggestions. The Speech from the Throne will only complicate the complex issues we have to face now, it continues undermining the confidence people may have had in their government. As federal civil servants will have to pay for reduced expenses, that will destroy the confidence civil servants had in government.
Mr. Speaker, let the government start once and for all to recognize the rights of people, their right to earn a normal and valuable living and then, if individuals are to be replaced by machines in industry and find themselves jobless, let the government be intelligent enough then to find ways and means to give those individuals a purchasing power which will allow them to buy this machine-made production. It is precisely what the Social Credit party suggests as a solution to these problems to ensure a guaranteed annual income for everyone so that people will have enough purchasing power.
To conclude, the only suggestion I can make now to the minister and to the government is to stop clouding the issue with a smokescreen, to stop telling us stories and giving us all that hot air. They should start to roll up their sleeves to tackle the economic problems. It is a matter of urgency as more and more people are really fed up to be taken in, really fed up to lose their job and to have to live not even on unemployment but on social welfare.


Mr. B. Keith Penner (Thunder Bay):: Mr. Speaker, the hon. member for York South (Mrs. Appolloni) and the hon. member for Verdun (Mr. Savard) certainly distinguished themselves by the manner in which they moved and seconded the Address in reply to the Speech from the Throne.
The hon. member for York South expressed her love for Canada, her adopted country, and she did so in a most moving way. It was a tonic to hear our country praised for a change- so frequently it seems that Canada is described only in the most negative terms, quite contrary to the evidence around us. Of course there are some problems, and I shall spend most of my allotted time talking about a few of them, but there are many good things to which we can point with pride. I took much delight in the fact that the Prime Minister (Mr. Trudeau) devoted part of his speech to doing just that, and doing so most effectively.
I was pleased the hon. member for Verdun used a portion of his speech to talk about the senior citizens. After all, the prosperity and success of modern Canada are in large measure
October 16, 1978

due to their contributions at a time when, as a rule, rewards for achievement were much less than they are today.
The government's New Horizons program has given all hon. members the opportunity to become more closely involved with senior citizens groups, and those of us who have done so are greatly impressed by the way in which these grants are being used, and by the appreciation shown for them. If the government really wants an example of how to carry out a restraint program, it should observe with some care how these senior citizens' organizations take those grants under the New Horizons program and do so very much with them.
When the hon. member for Verdun was speaking, I recalled a visit of mine to his community at the time when he was contesting his by-election. A youth group from Verdun had invited me to participate with it in a seminar on development in northern Canada. The request came at the time when Mr. Justice Berger's report had just been released. I mention this incident only in passing because it illustrated for me that as long as there are Canadians in one part of the country, like Verdun, who take an active interest in and show concern about Canadians in another part of the country, like those living in the Mackenzie Valley, then somehow I feel that we do not need to become unduly disquieted about the depth and strength of this nation's unity.
During the month of August while parliament was in recess, the government announced its determination to reduce its expenditures. At one point, the President of the Treasury Board (Mr. Andras) expressed the view that perhaps today in Canada people have become too dependent on government and that they look to government for nearly everything. "What is the government going to do about this? What is the government going to do about that"? I am sure all hon. members have heard that question time after time when they have been in their constituencies. Of course there will always be considerable scope and need for collective action. This is the way in which a civilized nation is nurtured and built. The cost of creating a humane and decent society is considerable. In fact it is immense. At the same time, and in the process, it is also possible for well-meaning governments to assume too much unto themselves and thereby stifle or discourage the initiative of individual persons or of the private sector. Too much involvement of government in people's lives may and, in fact, does, as most of us can testify, cause resentment and bring about a reaction against government generally.
Throughout the 1960s and into the 1970s it is true that governments at all levels increased their shares of the gross national product. It should be noted, however-and the President of the Treasury Board has done this-that increases in government expenditures have come most significantly at the provincial and municipal levels. The figures are there, provided by the President of the Treasury Board, showing that the increase in total government expenditures by the federal government has been much, much less.
The Address-Mr. Penner
Any restraint program, however, must begin with a determination to eliminate waste, extravagance, and inefficiency in government. A restraint policy should not set out to destroy programs, facilities or agencies which are required and essential for the common good, that is, unless or until some private concern is prepared to take over the service and do it as well or perhaps more efficiently at less cost. A case in point is the announcement by the Minister of Agriculture (Mr. Whelan) to axe Canfarm, an important and essential electronic management tool for many farmers. Canfarm has been described as one of the most progressive programs that the government provides in agriculture. It has become indispensable to the most efficient of Canada's farmers.
If the Minister of Agriculture fails to find a private company or organization to take over the Canfarm service, then I think some consideration should be given to doing a number of other things. Consideration should be given to increasing user-fees, which now are really only nominal, amounting to $30 per year per farmer. Perhaps there could be some cutting back on the developmental work which comprises such a large portion of the total program expenses, and possibly the operation at Guelph could be made more efficient. Let the financial burden on the federal government be reduced, yes, but I say to the Minister of Agriculture, do not let Canfarm die.
The decision to close the Petawawa forest experimental station falls into the same category, another possible casualty of government restraint. My colleague, the hon. member for Renfrew North-Nipissing East (Mr. Hopkins), will, I am sure, have much more to say about this particular matter in his speech, and I commend him for his dedicated endeavour to reverse what seems to be a questionable decision.
The forest products industry is the major employer in the constituency which I presently represent. I am advised that this industry directly employs 300,000 people in Canada, and indirectly there are another 700,000 who owe their jobs to forests. Forest products contribute significantly to our merchandise trade surplus-to the extent of $4 billion a year-and the federal government derives revenue from this industry to the extent of $1 billion annually. In the light of these statistics it is easy to understand why people in the industry resent the proposal to close a forest experimental station or a forest lab. In a letter, one of my constituents expressed it this way:
If I had to change my personal budget because of monetary restraints, I would look at unnecessary expenses and tighten regular expenses, but, I would not stop wearing shoes so I couldn't get to work, to save a few dollars.
Forest research in numerous areas is urgently required in order for our Canadian industry to survive. It must survive against competition which is rapidly developing in other countries which have much better climatic conditions than we have, and where trees grow much faster.
The announced government restiaint program is surely a welcome invitation to parliamentary committees to become sharper and more effective in their examination of spending estimates. Those of us who serve on these committees are supposed to be the watchdogs of the public purse. I think that is the way it goes, in political science anyway. Well, if we are
8006S-9'/2

October 16, 1978
The Address-Mr. Penner
the watchdogs, seldom has our bark frightened anyone, and rarely has anyone been bitten for squandering public funds. It seems to me that a time of restraint is a good opportunity for parliamentary committees to prove themselves.
An exercise in restraint is also an opportunity for the government to redirect its efforts toward more desirable social and economic goals. In a time of high unemployment one of those goals must be job creation. In a time of high inflation one of those goals must be to redirect income to where it is most needed, to the elderly and to low-income families. These are measures which we will be debating during this session of parliament.
Above all, restraint will only hurt-and not help-unless the end result is a stimulus to economic growth. Since the early 1970s Canada has been suffering from a very serious lack of economic growth. Advocates of a no-growth or slow-growth economy have been notably silent these past few years. They have been silent because the results of that kind of an economy are not acceptable. The results are a rising rate of unemployment, especially among young people who are the newest entrants into our work force, and very large deficits in our international payments. Canada's current account balance has, with the exception of 1973, deteriorated every year since 1970. The major reason for this deterioration in our current balance is the rising deficit in the service account which escalated from $1.4 billion in 1966 to an estimated $8 billion in 1977. The service account deficit is the consequence of very heavy borrowing during the mid-1970s and an increasing shortfall in our tourist account. The devalued dollar has increased the cost of servicing our foreign debt, but unfortunately it has not generated as much additional tourism in Canada as it was expected to do. I say unfortunately, because the region in northern Ontario which I represent is one of the prime tourist regions of the country.
Looking at our merchandise trade account, the picture is much, much brighter, at least upon first glance. This year, our trade surplus in goods is expected to be $4 billion, which is up from $2.9 billion in 1977. But I would remind hon. members that it is our trade in primary resources and semi-fabricated goods which has made this trade surplus possible. Our trade in finished, manufactured goods or end-products continues to decline. It was minus $3 billion in 1970, and last year it was minus $12 billion. Canadians are buying foreign made goods at the rate of $42 billion a year, which is approximately $2,000 per person, or $8,000 per household in Canada. It is the sale of our wheat, forest products and minerals in large measure which makes it possible for Canadians to buy so many imports, much of which are in the luxury class.
As a member who represents one of the major resource regions of the country, of course I am delighted that our minerals and forest products are helping so much to provide Canadians with a high standard of living. I am pleased that we are able to contribute so significantly to Canada's trade sur-

plus. But there are dangers for us if we continue to rely too extensively on our natural resources to keep us afloat.
The manufacturing trade deficit reveals that there is a serious lack in the processing of our natural resources. Natural resource exports have been a redeeming feature in our merchandise trade account, but selling unprocessed materials abroad also means the exportation of jobs, jobs which we badly need in Canada at the present time. For example, it has been estimated that when we export $1 billion worth of natural resources, we generate 60,000 jobs in Canada. In turn, when we buy $1 billion worth of manufactured goods from abroad, 240,000 jobs are involved. This is the situation in Canada which is leading to more and more discussion by people in the univerisities, by economists and by other groups of concerned citizens, more and more discussion about the need for policies to encourage further processing and manufacturing.
Those of us who live in resource regions favour more on site processing. We would like to see more jobs created in the regions from which the natural resources come. We believe that this is the key to genuine, long term and lasting regional development. Coming from a region which depends heavily upon the forest products industry, I appreciate the positive results which flow from the increased processing of raw materials. For example, increased processing of pulp has meant a steady improvement in Canada's account for fine papers. Imports of fine papers are expected to decline substantially this year, and exports will grow appreciably. Canada's improved performance in the fine papers industry has occurred because of increased rationalization and specialization. Paper mills have concerntrated on fewer grades, weights and colours. Rationalization and specialization seem to point the way toward a more productive and competitive manufacturing sector in Canada. Those who know say that this sector is now plagued by duplication, excess capacity, and short production runs.
A recent visitor to my office put it this way in describing what should be done to improve the industrial situation in Canada. He said:
We are putting our money on too many horses. We should pick the winners.
I would argue that the winners must include those industries most closely connected with the development and processing of our natural resources. Those industries, as well as others, would add value to the raw materials we produce and the energy we consume.
In the report by the Sector Task Force on the Canadian Nonferrous Metals Industry, recently released there were some rather startling figures concerning the value added content in Canada's export of metals. The report indicated that approximately one half of the copper, lead and zinc mined is exported in its concentrate form; only one half is smelted and refined into primary metal. Some two-thirds of the primary aluminum, copper and zinc are exported; only one-third is used in Canada's secondary manufacturing, and over 90 per cent of the nickel produced in Canada is exported.
October 16, 1978

While I have argued this afternoon for policies which would encourage, as a part of our industrial strategy, rationalization, specialization, and incentives for increased processing, I would not favour any policy which would act as a disincentive to mineral exploration and development. Much to the contrary, to discourage resource development would not aid manufacturing. Failure to encourage capital formation for resource development means that capital will go elsewhere in the world, and our Canadian resource regions will remain underpopulated and economically depressed.
Since the three main industries of northern Ontario are forest products, mining and tourism, I was extremely pleased by the announcement of the Minister of Industry, Trade and Commerce (Mr. Horner) indicating that there would be increases in economic development programs amounting to $300 million in 1979-80. Approximately $65 million of that total increase will be to provide support for tourism and resource industries. Of equal interest for me was the announcement by the Minister of Energy, Mines and Resources (Mr. Gillespie) which outlined government support of $400 million for renewable energy technology and industries founded on the commercial use of such technology. He stated that over the next five years the government plans to devote a large chunk of this total to the utilization of foreign wastes which are now by-products of the lumber, pulp and paper industries.
With regard to the mining industry, there have been two fairly recent reports pointing to the less than buoyant conditions for the industry in Canada. One report is entitled "The Decline of Small Mineral Enterprises in Ontario". It maintains that higher exploration costs, falling returns, and increased risks have had a negative impact on the small mineral enterprises in the province of Ontario. That report was published by that provinces's ministry of natural resources.
The second report is one of our own. It is the Sector Task Force on the Canadian Nonferrous Metals Industry to the Minister of Industry, Trade and Commerce, a report to which I referred earlier. The task force was one of the 23 commissioned after the first ministers' conference last winter to examine various sectors of the economy. The report maintains:
Unless measures are taken by all concerned to revive mining exploration in this country, there will be a spectacular decline in the production in this sector over the balance of the century.
There are some recommendations, one of which has to do with capital formation. It states:
With capital formation the issue of overriding importance, an early resolution of the dispute between the federal and provincial governments over mining taxation would produce more rational tax structures and create an environment more conducive to capital formation.
Secondly, the report recommended:
In order to encourage increased resource processing and trade the report recommends further incentives for research and development.
I was going to comment about Canada's position at the present time with respect to research and development as
The Address-Mr. Penner
compared with that of other countries. However, hon. members are so familiar with these figures that it would be redundant on my part.
I will leave that and move on to the third recommendation in the report, which is as follows:
A problem of increasing importance in the mining industry is labour retention, particularly at Canadian mining operations remote from urban centres. There is often an excessively high turnover rate for the work force in these locations. In order to encourage the movement of people from urban areas in the south to isolated areas in the north, the government should give serious attention to a form of income tax relief for employees in remote areas in Canada who remain on the job for more than two years.
I have made this suggestion in the House before. The response has been that the government, at the federal level, cannot deal with regions, but must deal totally on a national basis. We know that in recent budgets the government has moved more and more toward a recognition that there needs to be special policies for particular regions in order to meet the needs and solve the problems which exist there. I do not think the old argument will stand any longer.
Those who live and work in remote communities located in resource regions are, in general, under-serviced. In some places this is far more serious than in others. Many must travel considerable distances for medical and dental care. Postsecondary education requires moving away from home, and there are additional costs for parents. In view of this additional travel I must not fail to point out to the House that these people pay anywhere from 15 to 20 cents more per gallon of gasoline than do people in urban areas. Yet, the products of our resource regions, as I have demonstrated this afternoon, contribute a disproportionately large amount to the national economy. Our tax system, it seems to me, should provide some tangible rewards for those who work and live in these regions.
If time allows, and I believe it does, I should like to point out that some people in the mining industry have expressed concern about the activities of the Export Development Corporation. Those concerns are based on serious misconceptions as to the purpose and function of the EDC. The Minister of Industry, Trade and Commerce has pointed out that the corporation's role is to facilitate the sale of Canadian goods and services to foreign buyers. EDC loans are tied directly to the sales of Canadian equipment and services, so they create jobs for Canadians.
Neither the Government of Canada nor the EDC has the power to prevent a sovereign nation from developing its own natural resources. If we do not arrange financing for the sale of our equipment and services, then some other nation most certainly will, some other nation such as Japan, Germany, France, Great Britain or the United States. As the Minister of Industry, Trade and Commerce has said:
If Canadian exporters are to be prevented from selling to such buyers, we will lose not only their jobs, but tomorrow's competition-and we shall be worse off for it.
To conclude, we are being told today that Canada must learn to live within its means. We must import fewer luxuries, we must buy more Canadian products, we must divert more production facilities to exports, and we must spend on consum-

October 16, 1978
The Address-Mr. Darling
er goods only what has been earned. In the short term, the lower Canadian dollar can help, but in the long haul it will not solve our problems of unemployment, of inflation or of sluggish economic growth. Nor can we expect that our natural resources will help to balance our accounts forever and ever. This simply will not be, and it is time to turn our face to the future.


Mr. Stan Darling (Parry Sound-Muskoka):: Mr. Speaker, it is a privilege to participate in the debate in respect of the Speech from the Throne, such as it was. Before commencing my remarks I should like to congratulate and commend the mover of the Address in Reply to the Speech from the Throne, the hon. memer for York South (Mrs. Appolloni), and the seconder, the hon. member for Verdun (Mr. Savard).
At the outset I would certainly like to echo the question a vast majority of Canadians are now asking, and that is, which way are we heading? This question has come to haunt an increasing number of Canadians with the entrenchment in power of the Liberal government over the last decade.
Canada is at a unique juncture in its history. We are facing many challenges, with over a million Canadians out of work, a distressingly high inflation rate which threatens to become a double-digit phenomenon, a miserably slow growth rate, impending constitutional changes, and a national unity crisis. One views the state of the nation with grave concern. I must register these concerns even at the risk of being termed an alarmist by government members who prefer not to be reminded of their record over the last ten years of Prime Minister Trudeau's government.
We require renewed faith in the ability of Canadians to surmount any obstacles on the road to making this country an example to the rest of the world. We need dynamism and farsighted leadership to inspire Canadians to place their faith in our country. Lack of effective leadership has led to haphazard and shortsighted policies being pursued by the government. The result of such policies is evident in the economic malaise that afflicts us today, political uncertainty, and an increase in social stress as reflected in the persistent state of labour unrest.
Last week the Prime Minister (Mr. Trudeau) made a flamboyant speech in the House. It was a lot of sound and fury, and I think, as Shakespeare said in one of his plays, it signified nothing. The highly entertaining performance relished by his own party members left many Canadians questioning the seriousness with which the current leadership is viewing the problems facing us.


An hon. Member:: They liked it.


Stan Darling: Certainly, they liked it. The Liberal side really liked it, but did the Canadian people like it? According to a poll taken across the country and the marks given out, the Prime Minister, because he did come on particularly strong in the last few minutes when he left his notes, was given a five out of ten for his performance, while our leader was given an eight, and that was an unbiased poll.


Some hon. Members:: Hear, hear!


Stan Darling: That is just an example. I can assure my government colleagues across the way that the people of Canada who were listening in on live television probably were not able to get the same out of his speech as we were sitting right across the way, and they probably marked the Prime Minister's performance even lower.
The current leadership is indecisive. No one needs to be reminded of the guessing game the Prime Minister engaged in earlier this year about calling an election when he was faced with adverse reports from internal sources which indicated the unpopularity of the Liberal party. The fact is that the Prime Minister got cold feet and stalled. The government cannot tolerate the thought of facing the electorate. The wrath of the voters will deliver judgment on the government policies that have plunged Canada into serious economic and political trouble.
This is a rather unique day because a mini-election is being held. I know a great many people will be watching with interest when the polls close at eight o'clock and the results begin to come in. I am not one to forecast any election results-


Mr. Cullen:: Go ahead.


Stan Darling: All right. I will say that the Progressive Conservatives will come out with at least nine seats, and I am being very conservative with a small "c". We will see what that forecast brings.


Mr. Young:: Would you resign if you are wrong?


Stan Darling: Hardly, but that would be one bet, if I was a betting man, that would probably be safe to make. Would the next speaker from the government side of the House be willing to make a guess and put his seat on the line for the number of seats he will stipulate that his party will win in the by-elections today?
Anyone who examines the record of this country over the past decade would wonder just what is happening and what direction the economy is taking. The most obvious and highly embarrassing situation that confronts us today is the value of our dollar on the world market. This is a vote of non-confidence cast by the international financial community on the policies of the present government. The disastrous economic policies of this government continue to plunge the value of our dollar further downward. The government continues to find scapegoats to blame for the decline, but it would be well advised to examine carefully its own record and policies rather than to blame the Canadian public.
The Canadian dollar has hit an historic low. Surely the Prime Minister will agree that this is not a reflection, as he states, of a "healthy country in a difficult world". The decline of the dollar has led the government to engage in foreign borrowing to prop up its value. It pays out heavily in interest charges which further prevent us from attaining a balance of payments equilibrium.

::

:

October 16, 1978

One obvious advantage of the devaluation of a country's currency is that its goods and services become attractive to foreign markets. This was brought home to me in my own particular riding, in the village of Burks Falls where I live. There is a woodworking industry that is working at full capacity there because a large amount of their production is exported to the United States. But that is the exception to the rule, and there is no question that that firm is doing very well. While in attendance at a social event in the town of Powassan on Saturday night I spoke to a lumberman who also informed me that his firm is doing exceptionally well at this time. As he said, "They are just waiting to grab the lumber as it comes off the tail saw and send it direct to the United States." So, there are some advantages, but in the long run it is not in the best interests of Canada as a whole. Unfortunately, as I mentioned, the value of our dollar has defied traditional economic wisdom in so far as not providing a boost for many more exports than the examples that I gave.
I could go on endlessly listing the failures of this government. For instance, inflation has more than doubled from 4.5 per cent in April, 1968, to almost a double-digit figure. Similarly, housing costs have doubled in the last ten years and the unemployment rate has risen drastically from 4.5 per cent in 1968 to 8.6 per cent in 1978. I am aware that the present minister of employment is greatly concerned about this and is endeavouring to do something to alleviate the situation, and we are hoping that something can be done to turn things around. I am very pessimistic as to what is going to happen during the coming winter.
I mentioned that housing starts are down. The government, in its wisdom, has cut expenditures on a great many departments, something which will make many Canadians very unhappy. I am thinking in particular of those in the low income bracket, who are living in houses which are not in good condition and who had hoped to benefit from the government's current insulation program. The provinces of Nova Scotia and Prince Edward Island receive $500 per house under this plan and the people in the other provinces receive $350 for insulation. With the $110 million cut, there will certainly be a great many applications submitted that will have to be turned down. I am still receiving applications from some of my constituents and, of course, I will have to write them in the course of the next day or so telling them to get their applications in in a hurry because the chances are not as good as expected.
Another concern to me is the great exodus of Canadian capital for housing investment in other countries. It is estimated that over $1.4 billion has left Canada for the United States. Much of that money is being invested in apartments and buildings there because Canadian businessmen and developers feel they will get a much better return for their dollar. This is most unfortunate for our country where housing construction is needed, as well as other building construction.
What surprised and further depressed many Canadians was the Speech from the Throne and in particular, the Prime Minister's theatrical performance that failed to provide any
The Address-Mr. Darling
concrete solutions or suggestions to deal with some of these problems. None of the other members of the cabinet have come forth with any policies either. One would have thought that this would be an ideal time for the government to indicate in some small measure what remedies it may be contemplating for our ailing economic situation. Instead, the cabinet and the Prime Minister have engaged in a frantic effort to convince Canadians that all is well, but the Canadian public knows otherwise for they face inflation in the supermarkets every day.
The Speech from the Throne is full of promises. It is littered with the same repetitive and unkept promises that one found in the previous nine Speeches from the Throne. However, it contains no plan of action. On the other hand, I highly commend the leader of my party for delivering a very eloquent address outlining in concrete terms what my party intends to do when elected to govern the country at the next election.
We on this side, for instance, have advocated a proposal to provide tax deductibility of mortgage interest and property taxes on personal residences. I, for one, have long advocated such a move in order to ease the tax burden placed on the individual homeowners.
As reeve of a small community for over a quarter of a century, and as a vice president and member of the executive of the Association of the Ontario Mayors and Reeves, I know that time and time again they have brought in a resolution to the effect that a tax on tax was unfair. The United States have done it for a number of years and, certainly if it is successful there, it can be just as successful here. I would not be surprised that the government, through its lack of policies, ends up by stealing that policy from us. If they do, more power to them.
The Progressive Conservatives have also proposed tax credits for research and development and cutting waste and inefficiency in government. These are, Mr. Speaker, but a few of some very specific proposals put forth by the leader of my party. These policies will be implemented in the very near future when the Canadian public is offered an opportunity to go to the polls to chase out the ineffective Liberal government and replace it with a responsible Progressive Conservative government.
For one who hails from picturesque Parry Sound-Muskoka, it is gratifying to note that one of the promises contained in the throne speech is to provide additional assistance for tourism. I sincerely hope that the promise does not become one of a string of earlier unkept promises. For instance, the government has been promising more aid to small businesses for the last five years. However, by the Prime Minister's own admission, small business is still being strangled in this country; evidence of this is reflected in the 49 per cent increase in business bankruptcies in August over the same month last year.
The hon. member for High Park-Humber Valley (Mr. Jelinek), this party's critic on small business, outlined at some length our position on small business and its importance to the

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economy. Small business employs over 55 per cent of people in the country and generates over 60 per cent of the gross national product, so it is a most important part of the economy. I wonder how the many small businessmen view the recent increase in the prime rate of the Bank of Canada to 10% per cent today, a jump three quarters of one per cent. That just makes it more difficult to borrow money or, if you can borrow it, it is more difficult to pay it back.
This morning I had a telephone call from the operator of a sawmill in my riding who needs additional financing and is finding it difficult to get. I suggested that he contact the nearest branch of the Federal Business Development Bank where I hope he will be able to make satisfactory arrangements. Its interest rates are not the best, but many Canadians are delighted to be able to deal with it as a lender of last resort.
Tourism is Canada's largest single employer and the sixth largest source of foreign exchange. Furthermore, the combined value of visitor expenditures and domestic travel spending amounts to a $11 billion industry which accounts for 5 per cent of gross national product and yields governments some $5 billion in tax revenues. Yet for too long tourism has been denied the necessary recognition as an important economic and social element in our society.
I have said before, but I will place it on the record again, that I think any department or business that generates $11 billion worth of revenue should be given prominence and, therefore, I feel there should be a minister of state for tourism. Even in this time of cutting back expenditures that would not mean that one additional person need be hired. There are plenty of people in the branch of the Department of Industry, Trade and Commerce responsible for tourism who could do an excellent job. Tourism is vital to the economy of Canada and, I must say in all fairness, to the great riding of Parry Sound-Muskoka where it is the main industry.
It is ironic that it was in Bonn earlier this year that the Prime Minister first became fully aware of the seriousness of our domestic problems. The Prime Minister took some heed of the concern expressed by leaders of other industrialized nations about the state of the Canadian economy.
The Prime Minister suddenly became aware of the high rates of unemployment and inflation, and of the astoundingly high federal spending spree. Federal spending has increased by 400 per cent since the present government came to power ten years ago. Upon his return from the Bonn economic summit the Prime Minister hastily arranged to make a nationally televised address to enunciate a new economic policy. The announcement contained the usual promises to do something about everything. It is understood that a majority of the cabinet members were not even consulted before the address. The Prime Minister is not only isolated from the aspirations of Canadians but from his own close cabinet colleagues. Later, in a string of dramatic pronouncements which invoked images of a theatrical performance, about half a dozen cabinet members appeared on stage during the month of August to seek economic credibility. Now that the dust has settled from the

summer activity, Canadians find themselves faced with no brighter economic prospects than before all the August announcements. Once again the government failed to offer any long-term solution or suggestions and most of the cuts announced are to take effect in the 1979-80 fiscal year.
The Prime Minister came to power a decade ago promising a united Canada. Canadians justifiably ask themselves today whether we are any more united or further torn apart.
The Prime Minister wonders why Canadians are questioning his intentions vis-a-vis the monarchy in the package on constitutional reform. When one observes the Prime Minister vacationing in North Africa on a purely private holiday and not at hand to welcome the Queen as the head of state, one questions his real intentions about the kind of role, if any, he would like to assign to Her Majesty the Queen.
The process of constitutional change is a very fundamental one for any nation, with far-reaching effects. It came as a surprise, therefore, when the Prime Minister, in introducing the constitutional proposals, placed a deadline on the passage of these proposals. I commend the joint Senate-House committee which did not agree to head the Prime Minister's authoritarian whims.
A joint effort by the federal-provincial governments is essential to tackle the constitutional issue. Unfortunately, statements by a number of federal cabinet members to the effect that the federal government could act unilaterally in implementing some of the proposals, seriously jeopardize the healthy working relationship that must prevail between the two levels of government. As a result of the statements by the cabinet members, the ten provincial premiers meeting in Regina unanimously denounced the Prime Minister's approach in dealing with the ten provinces in constitutional matters. I believe that the provinces must be included as equal partners in any discussion affecting the future of Canada. The Prime Minister will be well advised not to rush through some haphazardly constructed policies that may come to haunt the nation in the not too distant future. A constitution is meant to unite and inspire a nation. Let us hope to achieve the same in our constitution.
I convey my sincere congratulations to the leader of my party who is engaged in maintaining a sustained dialogue with the provinces. Unfortunately, the Prime Minister finds himself in confrontation with the provinces most of the time. After all the reason may lie in the fact that the Liberals are in power in only one province, and by a mere one seat.
These remarks will not be complete without some reference to the deplorable state of the Post Office. Canadians are once again faced with a nation-wide postal strike. The Post Office, which now ranks as the twelfth largest user of government funds, has, over the years, grown into a monstrous bureaucracy plagued by labour-management problems resulting in crippling strikes at too frequent intervals. The strikes create not only inconvenience but massive economic hardship for small businesses so heavily dependent on the services of the Post Office.
October 16, 1978

The Progressive Conservative party has for long advocated the transformation of the Post Office into a Crown corporation before the Prime Minister consented to the idea in August. It is my sincere hope that the structural change will result in a more efficient operation of a very vital service. One hopes that a settlement will be reached by both parties to the current dispute and thereby avert another strike.
I am well aware that serious talks are going on at the moment between Post Office management and union officials. Let us hope, in the interests of the Canadian public at large, that both sides will give serious consideration to continuing the service, thereby making it unnecessary for this parliament to bring in legislation to keep the CUPW workers at work. If they do go back to work and things are not satisfactory, to put it mildly we will not be getting 100 cents on the dollar from the employees who are back at work because we know that they will not be working as enthusiastically as they would under normal circumstances.
I had the privilege of attending a postal users conference in Toronto during the latter part of September. It was very interesting, as a member of parliament, to hear the many speakers. The figures quoted were really astounding. Those people in attendance numbered some 500 and were the wholesale users of the Post Office. Their business lives depend on an efficient postal service.
I believe a representative of the Bank of Montreal commented on the amount of money paid by them for postal services. The spokesman stated that about two years ago the bank spent $9 million on postage. I believe this year, because of increased rates the amount is up to $12 million, but he mentioned the terrible postal service in operation between Montreal and Toronto. It is so bad the bank has given up on the Post Office. Instead there is now a special courrier who leaves the bank in Montreal with 300 pounds of mail at 3.30 in the afternoon. This mail arrives in Toronto by 9 a.m. the following morning. The bank's representative was asked why the bank did that. He answered that mail between Montreal and Toronto was taking as long as five, six or seven days to reach its destination.
Here we have a very important department of the government which is losing close to $600 million this year. If this department were run efficiently and without confrontation between management and labour, it might be able to recapture a lot of that lost revenue.
Another speaker at this conference was the vice-president of Maclean's who patted the Post Office on the back with one hand and then by saying they gave reasonably good service, he gave them a kick with the other. I believe Maclean's spent $6 million a year on postage. He went on to say that Maclean's spends another $1 million a year for courrier service in order to get their magazines and periodicals to certain key locations to be distributed by the Post Office. One can see that Post Office management could get even more business from that particular user.
The Address-Mr. Anderson
There is no other department of government that is more important to the people of Canada. Certainly National Health and Welfare is a high priority department. However, I believe there are more people concerned with the Post Office and with its efficiency.
I can see that my time is running out. I wish to thank you for your courtesy in allowing me to conclude my remarks.


Mr. Hugh A. Anderson (Parliamentary Secretary to Minister of Indian Affairs and Northern Development):: Mr. Speaker, before I get to the text of my remarks I would like to make a few comments, following from what the hon. member for Parry Sound-Muskoka (Mr. Darling) said. In my opinion many hon. members do not believe that should the Post Office be off for one or two weeks that will create a hardship for the people of Canada, and one which they cannot tolerate-


An hon. Member:: Tell that to them.


Hugh Alan Anderson: My Conservative friends, being reactionary as usual, would like to put everybody in jail who thinks of going on strike-


An hon. Member:: Who said anything about that?


Some hon. Members:: Withdraw.


Hugh Alan Anderson: In this country we do have certain basic freedoms.
People I met this summer on Vancouver Island were quick to point out that they were not against the basic right of people to go on strike, but with the right is a responsibility. People in my area on Vancouver Island were saying that if the Post Office and CUPW were responsible, then obviously they should have the right to strike, and obviously this is a right which should not be taken away from them.
People in Canada over the last several years have come to look at CUPW as an example of all bad that happens in unions because of a series of actions.
During times of relatively high unemployment and during times of concern about the direction our economy is headed, people tend to look at organizations, such as those in Sudbury which recently went on strike, as not being realistic. They tend to look at the labour movement as the culprits in our society. I do not believe they are. I believe the people of Canada would best be served if CUPW were a moderate group of people who could negotiate in a meaningful manner.
I do not think it is meaningful for CUPW to say, for example, that they wish to go from a 40 to a 30-hour week in one fell swoop, and then add approximately 18 hours of travelling time, tea breaks, and a few other breaks as well which would mean that the Government of Canada would have to hire an additional 46,000 workers. If CUPW want to have the support of members of parliament and the people of Canada generally, they will have to be responsible in their demands. I am not opposed to CUPW per se. However, I am opposed to irresponsibility, whether it be on the part of CUPW
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or the official opposition. Irresponsibility on either count is something with which we all disagree.
Many members have been told at the present time that if the public service unions are not responsible, the people of Canada would like the Government of Canada to take away their right to strike. I am not advocating that. I am saying that if you talk to people across this country, you will hear that said. I think it is wrong. We should not have first and second class citizens in this country, with one group of people having the right to strike but not another.
I fear that CUPW gives a black eye to the labour movement, whether it be private or public, and that it is fermenting disrespect for the labour movement. I do not think the labour movement can afford it at this time. I hope my fear is unfounded. However, from speaking with people in my area, as well as with those in other provinces, I find that subject is raised again and again. They feel that disruptions in our carrier service, police service or postal service, should not be allowed to take place and that legislation should be brought in regarding essential services.
I am not sure that is the answer. I believe it would be more profitable to attempt, through meaningful negotiation with responsible groups, to find solutions that do not cause inconvenience to the public. I hope that union leaders in organizations such as CUPW which have a higher profile recognize the danger they may get into, not only with regard to the right to strike but in another important area. If poor service is provided, less and less people will use it and less and less people will be required. I suppose CUPW could be put into the position of cutting its own throat due to poor service and interruptions in the mail service with private institutions taking their place. I did not want to get into that except to carry on with what was said by the hon. member who preceded me.
I would like to discuss briefly what has happened since August 1 of this year on the return from Bonn of the Prime Minister (Mr. Trudeau), who pledged at that time a major re-ordering of government priorities. If I am not mistaken, on August 10 in his national address, the Prime Minister came across saying that new, bold, innovative measures would have to be taken. I could not agree more. I very much support the statement by the Prime Minister that this is the time for bold, new measures to be brought forward.
Mir. Dinsdale: Things are in a mess.


Mr. Munro (Esquimalt-Saanich):: Why not ten years ago?


Hugh Alan Anderson: When the group across from me came into the House the other day and politely applauded their leader, I thought they had perhaps adopted a new form of manners which would carry on throughout this session. However, I see they are still unwilling to listen to anyone from the other side of the House. I would ask them to hold their remarks until I

make my few remarks. We would then be pleased to hear them.
In the context of what the Prime Minister said in his address, on August 10 1 wrote to the Minister of Finance (Mr. Chretien). I observed that over the years I have been in parliament, and even before I came here, when ministers of finance came before parliament with measures to last for six months, a year or sometimes two years, it was not in keeping with what we in Canada are facing today.
I think it is a fair criticism of governments past and future, and present I suppose, that they have always taken a short range approach. At the same time, it was not more than a year or two ago that the Minister of State for Urban Affairs (Mr. Ouellet) announced to the House a five-year program in which the government would encourage the construction of one million housing units in that period. In other words, he told the construction industry that the Government of Canada was bringing forth a plan which would allow them to dovetail their plans with the five-year plan. That gave the construction industry a certain amount of security with regard to the purchase of equipment and expansion of facilities. They knew there was a five-year direction in which they could go on unimpeded, knowing that we would not change our minds six months or a year later.
That was a very positive statement by the Minister of State for Urban Affairs. For the past two years he has been on target. In fact, he has been above target, which indicates it has been an attainable plan. Also, with various programs, the construction industry, governments, provincial and municipal, are delivering that project. At the end of the five-year period, we will in fact have had one million housing starts.
Something similar took place not too long ago. The Minister of State for Science and Technology (Mr. Buchanan) announced a long-term program for research and development whereby tax credits would be allowed up to 150 per cent. It is to be a 15-year program.
Important as urban affairs, research and development and new housing construction may be, is it any less important for the consumers of Canada, the investors, banks, manufacturers and other segments of our society, to have a plan similar to those brought forward by the two ministers I mentioned? In this way investor confidence and consumer confidence could be established. The government could announce that in a five year period it would come to such and such a point and this is the blueprint to be followed.
I have not been converted overnight to the five-year plans of our socialist friends, the U.S.S.R. and so on. However, I believe this is a day and age when governments can put blueprints before the country, to be discussed as to whether it is the proper direction to be going, and whether the government method of getting there is the correct one. In looking over past parliaments, I have yet to find it the case that a minister of finance or government brought forth that sort of comprehensive plan. It may not be that important to follow exactly a five-year plan. However, everyone would at least know in what direction we are going.
October 16, 1978

One objective that might be considered is for the Government of Canada to strive for a balanced budget at the end of a five-year period. It may be that we cannot achieve such an objective within a one, two or three-year period. However, is it not feasible to say to the people of Canada, our investors and manufacturers, that this is the direction that we want to go and these are the steps we will use to implement our plan? It seems reasonable to have an objective for more than a six-month or one-year period. There would be more confidence in this country if everyone were aware of the objectives we had for our economy. Moreover, business as well as consumer interests could make their plans in keeping with the objectives of the federal government so as to achieve what we all wish to achieve.
It is also obvious to me that in order to accomplish a plan of this sort we require the cooperation not only of provincial governments but also of municipal governments. The opposition does not often mention this, but the provinces and the municipalities spend more of the tax dollar in Canada than does the federal government. I think it is time we recognized that the municipalities do have a role to play in economic planning. After all, they are one of the three partners which, as far as governments are concerned, spend the money. It would be ridiculous to have a five-year program to reduce federal and provincial spending by 5 per cent, for example, if the municipalities were not brought in and did not agree to follow the plan.
I hope the present government or some future government, when discussing the national economy, will arrange for a tripartite meeting which would include not only the provincial governments, God bless them, but also their captives as they are sometimes called, the cities and the municipalities, which in some cases are very important in economic terms. Vancouver, Montreal and Toronto, for instance, spend almost as much as do some of our provinces or territories, yet they are not allowed to take part directly in this sort of enterprise. It would not be a particularly revolutionary idea to arrange for these people to be consulted as to the steps which ought to be taken to improve the national economy.
If we are to aim for a balance between revenue and expenditure over a period of years it will be necessary to identify those projects which are essential to the Government of Canada and determine which can be reduced without causing dislocation unacceptable to the people. It is all very well to talk about balancing budgets and exercising restraint, but every time action is taken by the government in this area our good friends opposite criticize the spending cuts as ill chosen. I think it would be in the best interests of us all to review a number of areas of expenditure with a view to determining whether they could be financed in greater measure by user groups rather than by the federal government. I would give hon. members an example. As one who comes from the boondocks, a small populated centre, I could find it very easy to talk about the Toronto Symphony Orchestra or the Vancouver Symphony Orchestra. I could ask whether the people of Vancouver Island
The Address-Mr. Anderson
were deriving any benefit from these activities. One could say, I suppose, that the people of Canada in general were benefiting, but I suspect it is the people of Toronto or of Montreal or of Vancouver who receive the most benefit from institutions such as these within their areas.
Is it heresy to suggest that those who are the principal beneficiaries should provide the most support? The government can put out seed money, as the Canada Council has done, but must the people of Canada provide the majority of the funding of such organizations for the next 50 years? Is there not a greater community responsibility? In situations where user groups are the main beneficiaries I believe the federal government should say, "We shall continue to make part of the funding available but the majority of money must come from the community. In the absence of support from the community the federal contribution will not continue indefinitely." Maybe the response in the area will tell the government how highly the service or the activity was valued. If people in the area where benefits are received do not wish to support these activities, should the federal government continue to make finance available? One could, of course, apply this principle too narrowly, but there are surely some non-essential services with respect to which a decision could be reached and expenditure reduced over a period of years in the interest of a balanced budget.
Incidentally, I have never heard spokesmen for the official opposition tell us whether they favour a balanced budget. The only programs I have heard of theirs in the last several months are programs which would cost more money and add further to the already high budget deficit. This subject is one upon which the official opposition has been silent in the last six or seven months during which they believed there was to be a federal general election; they never once declared it was a policy of a Conservative party to balance the budget. I am rather surprised at this because the message I have heard from the official opposition seems to be this, "We are the party of financial responsibility, while the Liberals are the spendthrifts and wastrels." The Liberal party has always considered itself financially responsible. At the same time I have never heard a statement from the official opposition that it would be their object, if elected, to bring down a balanced budget within, say, five years.
Does a party of financial responsibility go into an election promising the people of Canada further debt of approximately $4.6 billion? On the other hand, is this government, which is reducing government expenditures, the financial wastrel of this parliament? I can only judge by actions and deeds. I cannot judge by rhetoric. It is of no use to talk restraint when all you can come up with is added debt amounting to $4.6 billion. I suspect that there are people who have watched the charade which has gone on over the last few months.
The Government of Canada has been preaching restraint, not just for three or four months but for the last several years. Our friends in the opposition, who criticize us for throwing
80065 -10'/2

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The Address-Mr. Anderson
away taxpayers' money, have come up with programs which would cost an additional $4.6 billion. Although I would never accuse hon. members opposite, I suspect that that $4.6 billion program was proposed only as a political ploy in the hope of gathering a few votes from people who have not looked at our budgets. I am rather disappointed that people with apparent capability in financial matters suggest that they might save this country from Liberals who madly throw away money. I do not think my party has ever thought of throwing away money as the Conservatives have. I hope the people of Canada watch, and listen to what is being said, because I suspect that hon. members opposite cannot get away with that any more.
People in Canada are a little too sophisticated to be taken in by this boondoggle which it is patently obvious is designed to do only one thing, and that is to get in and out of an election by making as many promises as possible. I suspect that the people of Canada are not quite naive enough to say that we are spendthrifts when hon. members opposite are prepared to put out some $4 billion with no recovery, and when we should be talking about saving money, not finding new ways to spend money we do not have.
The other boondoggle is the proposed expenditure of $1.6 billion or $2 billion to reduce taxes for homeowners in Canada. If we are serious about helping people-not just owners of big houses who can afford $50,000 mortgages, but also renters and people in many other situations-I hope with the co-operation of all parties we will find an equitable system for all Canadians rather than just for those to whom the Conservative party usually appeals, people on high incomes who probably do not require tax assistance in the first place.
I hope that parliament will continue to assist people through such programs as AEIOP and others. Recently it was proposed that the government provide low income families with $200 a year in addition to $20 a month starting in January of next year. It seems to be reasonable and equitable that people who have the greatest need receive greater government assistance. There is no point for a breadwinner who earns $50,000 a year to receive the same benefit as a family earning $8,000 a year. I am very happy about that proposal of the Minister of National Health and Welfare (Miss Begin). She brought in something everyone said would never be accepted, a means test with regard to the family allowance.
I hope one further step will be contemplated. Although the guaranteed income supplement will be increased by $20 a month starting in January, 1979, perhaps serious thought could be given to the fact that there are people over age 65 who do not require government assistance. If it is our aim that people at lower income levels do not suffer further from disparity between rich and poor, surely this parliament in its wisdom could bring in programs, not to eliminate totally moneys paid to people over 65 who do not require it, but which would be equitable and which would assist those in greater need, and reduce moneys going to people who do not require it.
I do not think that is revolutionary. I have heard people complain that they have paid a lot of money into income tax, that they have employed people, and that they are the ones

who are not getting the benefits. They complain that we always give money to people on welfare and people on unemployment insurance and that those people are the beneficiaries of the system. They complain that they make $100,000 a year and it is all going out to other people. I say that that is garbage, because we have a system which allows people to make $100,000. Our system does not level everyone down with regard to income, as is the case in some other societies.
When a person has made his stake and has done very well in this country, it is two-bitting to say, "So what if that woman's husband left her; give her nothing." It is two-bitting to say, "It is my money you are giving away". I find that to be a contemptible attitude.
Some people who have done well in our system do not recognize the very simple fact of life that it is the system here which has allowed them to do this. The opportunity has been there, and the fact that moneys are taken by way of income tax and in other ways is really not the point in question. I hope that in our society we have enough tolerance to accept the fact that social programs are not demeaning to recipients because they are forced to be recipients.
There is a feeling among some that if a person, through illness or ill fortune, requires assistance, he is somehow taking advantage of the system. I think that for every ten people who would take advantage of the system there are a thousand who would not, and I find it demeaning that some of our citizens, not only in this House but also in other sectors of society, assume that undeserving recipients of assistance are the majority rather than the minority.


Mr. Deputy Speaker:: Order, please. I regret to interrupt the hon. member but his time has expired.


Mr. J. P. Nowlan (Annapolis Valley):: Mr. Speaker, I must say that it is an interesting challenge to participate in the debate on the Address in reply to the Speech from the Throne in the fourth session of the thirtieth parliament. I really am not going to take any time to comment on the words of the previous speaker, the hon. member for Comox-Alberni (Mr. Anderson). I was not quite sure what he was protesting about toward the end of his speech. As perhaps with other Liberals from western soil, he certainly gave a great demonstration of why they are an endangered species, especially in terms of messages. Without playing the role of a seer or a prophet, 1 think there will be a message tonight from coast to coast which will show that Canadians have not been fooled by government protestation and declaration.
The government talks about restraint and then cynically selects for cutbacks some of the high profile, very specific programs which receive a lot of press coverage, but in actual terms of savings make little difference in the federal treasury. The hon. member for South Shore (Mr. Crouse) has much more knowledge of fisheries than I. I will not deal with the specifics of some of the protestations or statements of restraint made by the Prime Minister (Mr. Trudeau) and subsequently
October 16, 1978

by other ministers. Contrary to what the hon. member for Comox-Alberni attempted to suggest, my party has been talking about restraint for the last ten years since I and the Prime Minister have been here.


Simma Holt: What have you done?


John Patrick (Pat) Nowlan: It is not what we have done. When one is in opposition he cannot do very much. Canadians will not be fooled by conversion on the road to Damascus. One cannot compare two or three months of speeches since August to several years of very deliberate policy. We have attempted to point out, by criticizing legislative programs, that some of the things we voted on would result in financial ruin. I am sure the message will be loud and clear tonight.
Without being detoured on some of the byways of some of the speeches which have gone before, let me congratulate the mover (Mrs. Appolloni) and the seconder (Mr. Savard) for their addresses in reply to the Speech from the Throne. I found it somewhat ironic that the seconder was the hon. member for Verdun in view of ongoing activities in the Canadian electoral process. Certainly the hon. member for Verdun deserves credit for his participation, but it is somewhat an ironic twist of history that his predecessor is being judged by the people today. The shadow of Verdun will be on some of the results tonight and, like some of the battles of old Verdun, the tale will be told very loud and clear.
The Speech from the Throne and the various speeches of the last few days have provided a contrast between the opening of this fourth session of the thirtieth parliament and that of the third session a year ago. Both speeches took place in the month of October, with autumn leaves, beautiful fall sun, and the painted hills of the Gatineau. Last year we were honoured with the presence of the King and the Queen-


Some hon. Members:: King and Queen?


John Patrick (Pat) Nowlan: Well, the Queen and the Prince. After the Queen is dead, long live the King. Royalty continues. We had the benefit of Her Majesty and the Prince coming to Parliament Hill in the landau. This caused an air of excitement and anticipation. Regardless of past evasions, we thought the Speech from the Throne by Her Majesty the Queen would be the final act and the final Speech from the Throne, leading into the general election which the country wanted.
I find it somewhat hollow for certain speakers to say, "what are you going to do, why have you not done more?" How can restraint be preached? Perhaps from a bookkeeping point of view certain programs will produce certain dollars in deficit. If a program is carried out as intended and defined, hopefully our stagnant economy will be stimulated. I will not deal with those areas, but I should like to point out that the contrast is invidious.
If one looks at the British history of parliament, he will realize that there has been a long parliament, a short parliament, and a rump parliament. But I do not believe in Canadian history that there has ever been such as lame duck parlia-
The Address-Mr. Nowlan
ment as the present one. We are going through the motions of staying here until the Prime Minister decides to issue the writ. The Prime Minister had more sharps and flats and starts and stops than an organ grinder on a merry-go-round when attempting to make up his mind. A poll from Goldfarb would provide him with a hint, and then he would find out that the hint was not too good. Then he would turn to the Gallup poll for guidance, followed by a return to Goldfarb. He sent Keith Davey to Vancouver, and had someone else fly to Halifax. If the business of the country was not so serious, we could all laugh at it.
One of the greatest testimonies to not calling an election was when finally the Prime Minister indicated that there would be no election and that the House would resume in October. On that day the dollar took one of its largest falls in the decline which has been ongoing for several months. That indicates the confidence of the outside world. It was realized that the chance to restore some confidence to the economy was going to be delayed a further six to eight months while a pantomine was conducted in the form of a forced session of parliament. When the Prime Minister finally decided to play his organ, he indicated that there would be no more flats or sharps; he pulled out the plug and continued the charade.
We have had the benefit of two interesting speeches, those of the Prime Minister and the hon. Leader of the Opposition (Mr. Clark). Those speeches were diametrically opposed. If one was a man from Mars, perhaps he could be forgiven if he did not appreciate who was the Prime Minister and who was the Leader of the Opposition upon hearing those speeches. There is no doubt that the Prime Minister put on quite a performance in terms of attack, ridicule, and contempt. Years ago I said that the Prime Minister is one of the thespians of the political stage. He makes the bard of old, Mr. William Shakespeare, seem like a piker. He put on a tremendous performance, the purpose of which was twofold. It was to buck up his troops who were feeling somewhat low, with just cause. Also it was to tell a certain lawyer on Bay Street to stay away, that this preserve is still prohibited because the Prime Minister would remain in office for a few more months. He told John Turner to stay away, that he was still in charge. In terms of the morale of his troops in the House and for the benefit of those who were sniffing winds of change, he put on a tremendous performance. From that narrow point of view he deserves credit.
In effect, the hon. Leader of the Opposition came forward with a draft Speech from the Throne in terms of positive things to be done. The Prime Minister's attack on my leader confirmed the fact that he felt endangered and is almost on the endangered species list. The performance of the Prime Minister will not go away, no matter what great theatrical performance follows his. The Prime Minister himself is one of the fundamental issues which confront the country from coast to coast. There are the problems of inflation, the economy, unemployment, and the weak dollar. Also we have a Prime Minister who has been in power for ten years, leading a government which has been in power for 15 years. The federal

October 16, 1978
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government is the oldest government in the western world in terms of continuity of office. Is it any wonder why Canadians will demonstrate their feelings at the polls? People realize that the federal government can be changed, as is the case with provincial governments and other world governments, if and when a general election is called.
The demonstrations which have occurred in the last few days illustrate my point. Our theatrical Prime Minister over the last ten years has highly personified his office. Whether offshore or onshore, he has performed before the cameras dramatizing his office. I sympathize with hon. members opposite who cannot understand and do not yet believe. Perhaps the results of the by-elections will show them better than I.
The members from Nova Scotia were the last ones to come from the political trenches approximately two or three weeks ago. I do not care about the columnists in Ottawa and the inner sanctum of the ivory tower, but they should realize that in Nova Scotia there was a strong anti-government and anti-Trudeau feeling. If they do not understand that, then they are just whistling Dixie. The longer they whistle Dixie, the better the tune for us to take over when Trudeau, if he is around, does call the next election. What has happened is understandable. This is human nature. My friend, the Minister of Employment and Immigration (Mr. Cullen), understands this. He and I came here pretty much at the same time, and we know this has happened before. We know this is historic, that there is precedent for it.
I remember an earlier time when Canadians put their faith and trust in a prime minister who was very colourful. When difficulties arose in a certain economic climate Canadians took out their ire on that prime minister with a vengeance. Between 1962 and 1963 the Conservative party lost more seats than it had previously won, and it dropped from 208 seats down to the minority government of 1963. The same thing is happening again. We have had the great expectations of 1968, the beginning of the love affair on the part of many Canadians, if you want to call it that. Canadians who were not committed to politics then saw the prime minister as a new man, a new politician. That was a love affair, but we all know what happens when a love affair goes sour. Rationale and logic go out the window and are replaced by criticism and complaint. The individual, and sometimes the public collectively, acts in an unreasonable way.
I suggest in all seriousness that is one of the reasons there is an almost virulent anti-prime ministerial mood in some parts of the country today. At one time the feeling was warm and close, almost a love affair; now it has gone sour and people want to get in their licks. I do not know how many people really love the hon. member for Halifax (Mr. Stanfield), but when he was leader of the Conservative party no one hated him. There was respect for him from coast to coast.
Seriously, there is a sort of unfortunate feeling in the political domain today that, while the people may have loved the Prime Minister a few years ago, perhaps ten, because of a

multiplicity of factors, including general economic conditions, there is no longer a love affair; and those on the negative side will not go away as a result of a parliamentary theatrical performance on the part of the Prime Minister, even though that performance was a boost to the troops and perhaps accomplished what the Prime Minister intended.
I say no more than that, except that what happened in Nova Scotia was not an aberration. I do not think that what will happen tonight in the by-elections will represent an aberration.
I would almost go so far as to suggest that what will happen in Saskatchewan a few days down the road will not be an aberration. I hope there is another performance by the Prime Minister before the next election in New Brunswick in order that the troops stay bolstered, because I would certainly like the next election to be run against that Thespian north of the 49th parallel, that present incumbent prime minister.
The Prime Minister put on that performance, and at least part of that performance again would explain why the public in Canada is rather negative in its appreciation of his talents. How could a responsible Prime Minister, trying to exert leadership in this country at this particularly difficult time, make the statement he made in his speech that we in Canada "are performing better than most, better than all, actually, if we consider the over-all of total performances"? He then went on to divide up the total performance into job creation, inflation, real income and housing starts.
I do not want to cast stones, but I will use that old maxim that figures do not lie, but sometimes liars figure. In a political, allegorical way, you define your own figures, your own total performances and thereby paint a rosy picture. It does not take the rhetoric of the House of Commons, or any speech from any of us, to point out to you, Mr. Speaker, what you found out when you were home this summer. It certainly does not take a speech from my colleagues here to tell me what I found out when I was at home and in other parts of this country during the summer. We all know that no matter how selectively you define the term, certainly the general confidence of the people in this government and in politicians generally is sadly lacking.
Inflation is historically high in many areas. We have extremely high interest rates, even higher following the announcement over the weekend. The public can no longer be duped. You can cite the job creation programs, you can talk about inflation and real income after taxes, and you can even point out housing starts, as the Prime Minister did; but you cannot fool the public because the people are living with these things every day. Every day the people are having to shell out.
The Prime Minister conned the public once in 1974 when he said there was not to be any control package because inflation was offshore; but then within a year, we heard that famous and memorable Thanksgiving speech on television. He told Canadians, many of whom were eating turkey, or those who could afford it were-he was eating crow and doing a flip-flop-that we were going to have a controls package. The people knew then they were conned but they will not be conned again. They know that these statements of rhetoric represent a
October 16, 1978

con job because they are actually facing and confronting day by day the economic difficulties of life today.
It was only a day after the Prime Minister's speech that someone more knowledgeable of economic figures than I, Mr. Donald McGillivray, the business editor of Southam Press, took the Prime Minister's selective figures and wrote in a most conservative way:
Trudeau is incredibly careless in the conclusions he draws from his numbers.
It is simply untrue to say, as he did, that "Canada, in terms of the employment growth rate, is the best in the world."
According to the statistical Yearbook of the United Nations, 15 countries had faster rates of employment growth between 1970 and 1975.


An hon. Member:: Which countries?


John Patrick (Pat) Nowlan: I have them here. They are Mauritius, Jordan, Malawi, Kenya, Turkey, Syria, South Korea, Malaysia, Yugoslavia, Romania, Spain, Swaziland, Tunisia, Fiji and Pakistan. Let me tell the Minister of Employment and Immigration that this takes us up to 1975. Perhaps those are exotic countries that started from a very slow base, and perhaps it is easy to play with those figures. But this statement was made by the Prime Minister who is supposed to be accepting some responsibility when dealing with these figures, instead of playing footsie with them.
Mr. McGillivray goes on to state:
Since then, Canada's rate of job creation has fallen behind other countries, including the U.S. Statistics published by the Paris-based Organization for Economic Co-operation and Development show that between 1975 and 1977 the U.S. created 6.4 per cent more jobs while Canada was creating only 4.2 per cent more.
He then asks rhetorically how the Prime Minister can cite these numbers to back his claim that we "still lead the world". Then he dissects the process of how the Prime Minister did this, namely by playing with figures. He states:
First, by restricting his "world" to 15 industrial countries and second, by mixing the slow recent rates of job creation with faster rates recorded before 1975.
He then continues by stating:
For proof, Trudeau cited Figures for the period 1968-76. And 1976 was, of course, the year when food prices slumped and gave Canada a relatively good year against inflation. Even so, Canada's performance was so-so, not immensely better.
More recent figures do not bear out the impression that we are doing better at all. The Economist, the British-based journal of business and current affairs, does a regular check on 10 "major economies" including Canada.
They are not the exotic countries which the Prime Minister had fun playing with the other day. This shows that eight of the ten countries, Australia, France, Germany, The Netherlands, Japan, Sweden, the United States and Britain, did better than Canada against inflation in the past year, and that only Italy did worse. My point is that while there was a great theatrical performance the other day, you did not have to question other prime ministers, be they Conservative or Liberal, and their statements when dealing with facts. We have found out to our sorry experience and to even the sorrier, more collective experience of Canadians that we have to question
The Address-Mr. Nowlan
and check the facts and statistics quoted by the Prime Minister.
More serious than just playing with the figures in an attempt to make a parliamentary debating point, is the frame of mind and the premise the Prime Minister reflects when he suggests we are performing better than we actually are. Because if you believe that frame of mind, then how can the Canadian people expect that there will be any change in policies which every objective outside observer has said are bringing economic despair, and in some cases ruin, to a good many parts of this country?
It is the frame of mind of the Prime Minister which has to be indicted here. It is not just three months of preaching restraint that is at issue here. When we go into the election campaign, as eventually we will, at issue will not be just the last three months or the six or seven months before that, it will be the ten-year period. He will not be playing around with different time periods and different countries then; he will be playing with our own country and defining his actions during the ten-year period that he has been in office. That is the time frame which will be relevant to Canadians when it comes to making their decision at the polls.
When he took over the government in April, 1968 unemployment was at the level of 375,000, or a rate of 4.5 per cent. Now it is 8.4 per cent or over 900,000. The youth unemployment rate has gone from 7.4 per cent in that ten-year period to over 14 per cent. These are some of the relevant facts and figures that will have to be considered and will not be easily sloughed off as they were here in parliamentary fashion the other day. The rate of inflation in 1968 was 4.5 per cent; as of August, 1978 it was 9.2 per cent. I could go on on this topic forever.
The unfortunate thing is that the just society of 1968 has become the sick society of today. It is sick on unemployment figures no matter how you count them up. The dollar reflects the sickness in terms of investor confidence outside this country. Some of our modes of transportation are in a sick state as, for example, Air Canada with its labour and management problems. Just today we received notice that the seaway workers are going to strike, and right now, as was pointed out earlier, the postal workers are negotiating in a situation where they may go on strike. You could almost take every facet of our economy-be it interest rates, strikes, inflation, unemployment-and see that in effect we have a thermometer that is registering rather high. It is a sad commentary that the just society has now become the sick society of ten years later, and this is another reason why I would think that the public of Canada wants a chance to make a value judgment on whether to extend the mandate of this government or to give it to some other party that will change the fundamentals of government.
The two speeches given by the leaders were so different. The Leader of the Opposition gave a very controlled, positive and constructive contribution with a few political sallies and barbs from time to time, which we should always have in a partiamentary debate in a political atmosphere. But the Prime Minister had a change in roles. From playing with figures and

October 16, 1978
The Address-Mr. Nowlan
using sleight-of-hand as though he were in a shell game and defining his own time reference in office, he turned to concentrating almost solely, in terms of theatrics, on heaping scorn and contempt on the Leader of the Opposition. Obviously, he feels threatened and can feel the warmth of the Leader of the Opposition's breath on his neck.
Had I been from Mars, I would have wondered if these two men were talking about the same country. It takes me back approximately 119 years to the "Tale of Two Cities" and a fellow called Dickens, who wrote, as many will remember:
It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair. We had everything before us, we had nothing before us, we were all going direct to heaven, we were all going direct the other way-in short, the period was so far like the present period that some of its noisiest authorities insisted on its being received for good or for evil in the superlative degree of comparison only.
The comparison of the speeches by the two leaders illustrates in fairly graphic form what Mr. Dickens said 119 years ago in his memorable "Tale of Two Cities". The two different leaders stood in this national forum, but one spoke and addressed his remarks to the problems of the nation and tried to give some examples of where he, had he written the Speech from the Throne or been the leader of the government, would be moving to try, with all the imperfections of any policy- because no policy will bring overnight redress or correction to 15 years of mismanagement, let alone the galloping mismanagement of the past ten years-to put this country on its feet again. The Prime Minister went into his selective figure routine where, by intellectual, dialectical, classical thinking you can prove almost anything. You could prove that the town of Wolfville, which I had the good fortune to come from, in terms of growth is most likely growing faster than the city of Toronto. That is the type of dialectical debating exercise that we got from the Prime Minister the other day. There was nothing in his speech directed to the problems of the nation.
The Speech from the Throne talks about the general state of the economy. We have had some press statements and undoubtedly there will be some bills proposed to plug the dike, like the Dutch boy many years ago, who saw the water starting to come through. There was also mention of the constitution. Unfortunately, Canadians have heard so much about the constitution that many of them are turned off by it. I could make a whole speech on the constitution and Bill C-60 as it then was. Certainly in terms of the economy there is no objective outside observer who does not say that something will have to happen.
The subject of the constitution-and I want to be kind here, for I have not said publicly what my thoughts are on the late, lamented bill, which frankly will not be lamented that much since it died with the old session-you would think would be the Prime Minister's forte since he apparently taught constitutional law at one time. However, in cabinet making it has happened that the person with the expertise makes the worst cabinet minister if he is appointed to the portfolio which is related to his field, because he thinks he knows all the answers.
This can be borne out, for example, where generals have become ministers of defence. Perhaps the Prime Minister has a blind spot. Indeed, I suggest that he has several blind spots in the area that was his professional expertise-the constitution.


The Acting Speaker (Mr. Turner):: Order, please. I regret to interrupt the hon. member but his allotted time has expired. He may continue with the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: No.


Mr. Arnold Peters (Timiskaming):: Mr. Speaker, I find it rather odd to be speaking on a throne speech in this session of this parliament. A few weeks ago I was asked if there was to be a throne speech and a budget in the new session and I said: "Not in my opinion". I thought the government would not want to drop the bills they have on things like constitutional change and that they would not want a throne speech because they did not know where they were going. 1 did not think they would want a budget either because they would not want to make a financial accounting unless they had to. The last session had gone on so long that most of us forgot when the last throne speech was.
Of course, I thought there would be an election last spring. I have never seen such preparation for an election by a government. Everything was arranged. They did not get their bills so far advanced that there had to be discussion of them to the point that opposition might develop. Programs were introduced that could be discussed without a conclusion being reached, so it seemed to me the best possible situation for an election.
When I heard that the Prime Minister (Mr. Trudeau) had added six or seven vacant constituencies to the list of by-elections, I was sure there would be a general election, that nobody would be foolish enough to have 10 per cent of the population vote in a mini-election. But all of these things came to pass and here we are in the middle of a throne speech in a new session in the fifth year of a parliament.
I listened to the mover and seconder of the debate on the throne speech and I should like to congratulate them on their presentations. It seemed as if they felt, as I did to some extent, that this is the first session of a new parliament-that this parliament will go on forever. Maybe there will be changes to make that possible and this is the beginning of a new era. They sounded like the speeches of totally new members, although neither of them are and one, I know, has made some very good contributions over the years. But I congratulate them both on their speeches.
Next we heard from the Leader of the Opposition (Mr. Clark) and the Prime Minister. I am in complete agreement with those who say the roles have been reversed. It was very surprising how much the Leader of the Opposition has learned about running a government-the necessary finesse, the rhetoric that is necessary to allow him to go in any direction after he finds out what the public will say. The Prime Minister then

October 16, 1978

came along like a schoolboy debating the subject of parliament in high school. In the best tradition of an opposition leader he presented his role in politics.
After travelling around the country, Mr. Speaker, I have come to the conclusion that the only issue that remains for an election is the Prime Minister himself. There are those who think he has done the best he could given the international implications and difficulties being experienced in monetary and fiscal areas throughout the developed and undeveloped world. On those items I think he performed very well, but he must have scared some of the people sitting in their living rooms watching the program, waiting for answers to their problems. They are in a major depression and they do not know what to do about it. They looked for leadership which was not forthcoming; all they got was a tirade saying how bad the other guy was and how bad things were in general.
There are two things that bother the public, Mr. Speaker. The first is the fact that jobs are not available for newcomers on the labour market. Some have been helped to a small degree with make-work projects, but there are no continuing jobs for them. This applies to a large percentage of the age bracket 15 to 24, those just entering the labour market. Some are drop-outs who in the past have been able to find manual work, jobs driving trucks or any job they are equipped for. They are willing and ready to do those jobs but what are they offered? They are sent back to school for retraining and then have to wait till something is available. Sometimes when they enter the labour market they are told they are too highly qualified for the work available and are entitled to more money than an employer can pay. In both cases they are sitting at home waiting for jobs. How long can they wait? I am not sure how long society will allow them to wait and unless there is a great change in our economy they will not find the employment they are trained for.
These young people know that they will be given a hard time by people in the community and that they are going to have difficulty making ends meet. In my community and others some young people have committed suicide because there is just not any future for them and there is no way of getting a living other than stealing or living off their parents. In many cases young people do not want to live off their parents. They did it for years when they felt it was the obligation of the parents to support them, but then they believed they had an obligation to make their own contribution. They are ready to do so but there is no opportunity for them to participate.
Some welfare officials advise young ladies of 18 or 19 years of age to live at home because welfare benefits are not available for them. Just this week I had a case of a father who said to his daughter, "I have six other children to raise; I cannot afford to feed and clothe you and supply you with cigarettes." What is she to do? There is only room for a certain number of prostitutes and there are only some young women who are qualified to be prostitutes. Yet it is the only kind of job that many 17 and 18-year-old girls can get if they leave their community and go to the city. It is not a nice situation but it is part of our society today, as any police
The Address-Mr. Peters
officer will tell you. Where do young ladies go who leave the community? Most of them are found in that profession. It is not entirely their fault. We have a responsibility as well and we are shirking it.


Simma Holt: Perhaps there should be a quota system on prostitution.


William Arnold Peters: Perhaps there should be; it depends on the market. It is a free enterprise system and there are a lot of people in that profession who do not want to be but are because there is no alternative. We are not providing opportunities for our young people. I think that is a field in which governments, provincial and federal, have to get directly involved. If there are no jobs, then we should be increasing those kinds of operations that most of us are not completely in favour of but should be looking at, if that is the only alternative left. For example, I think of youth camps or Army training, if that is the only type of training possible. But this winter, with the curtailment of unemployment insurance, and particularly in Ontario where the municipalities themselves quite often make the decision as to how they treat young recipients of welfare, unless parliamentarians do something about the job situation many of the injustices concerning the young will be much greater than before.
I am told that we are in a period of austerity. We are going to cut back on this, and we are going to cut back on that. We have been operating a country for many years on the basis that we were a subsidiary of the United States. The parent company at home could not make enough of the product to sell throughout the world, so they allowed the subsidiary to do some selling as well.
Canada did get into the export market with some manufactured goods and I think we did very well. As soon as there is difficulty in selling manufactured goods, no matter the value of our dollar, the parent company will say: "We want to do the selling; the market is not big enough for you and me, it is only big enough for me." As a result Canadians have not done very well in that regard.
We must think, Mr. Speaker, about some of the things we are doing to provide a better life in this country. All Canadians had better take a look at how we are balancing our trade today. We are balancing our trade today, to the extent we are, by selling raw materials. We are selling our birthright. We are depending on agriculture, on forestry and on mining to balance the budget accounts of our nation. And we are not making it even at that. No other country in the world gives away the amount or resources we give away in return for so little.
I am amused by some of the suggestions 1 hear for increasing production in Canada. It was interesting to note that the government of Ontario and the federal government got together recently. They wanted the new Ford plant built in Canada because it would provide jobs. That is very nice. We would like those jobs and we would like that new plant in Canada but did we really have to provide $75 million to get Ford to come here and help us out?

October 16, 1978
The Address-Mr. Peters
I checked some of the figures published in the Financial Post. I find, looking up these corporations supported by Liber-ils and Conservatives-the free enterprise system-that Ford of Canada actually owns dollar shares worth $8,294,000. Of that number, the United States owns 88.4 per cent, or $7,336,603 worth. In December of 1977, the last available figures, the dividend paid was $8.35 per share or $61,227,235. The amount paid to the American company was 88 per cent, or $61 million.
At the same time as we allow them to transport out of Canada, as a dividend, $61 million plus a few thousand dollars, we allow them to blackmail us into supplying them with a further $75 million. That amounts to a whole year's dividend. We are going to bring that money back in, but since we do not have that money we borrow it from the Americans. We pay interest on money provided to Ford Canada to come back into Canada, though we have already in one year, given them almost sufficient money to have done that themselves had they wished.
The situation is no better in the case of General Motors of Canada. General Motors of Canada has very few shares, some 703,250. These are all held by General Motors Corporation in the United States. Their earnings are $227.24 per share. They paid out a dividend of 53.9 per cent, which is $122.48 per share, with a total of $86 million and some odd going to the United States. What are we going to do with that money, Mr. Speaker? We are not going to let General Motors build a plant in Canada with that money, which they have already taken out of Canada. We are going to give them some more money and use that as a carrot to bring them back into Quebec to build a casting factory in that province. The Quebec government will give them some money and the federal government will give some money.
The Financial Post tells us there is $66,000 in dividends leaving Canada each hour for the United States. This money comes from American owned corporations in Canada. It would seem to me that unless we really loved those Americans a better deal than that could be obtained. Either there would be some way of stopping those dividends from leaving the country or there would be a tax on them.
With that kind of monetary drain out of this country in dividends to Ford and General Motors, we should be able to buy American Motors and set up our own automobile industry in Canada. Maybe they do not produce the best car in the world, but the price is right now. It is likely to go broke in the next few years. Why do we not buy it? It has the patents which are necessary and their cars could be built in Canada and we could use all of the dividends which are going to the United States. Some of them come back to Canada. We could tax those dividends. We could do a lot of things with them.
Recently we decided to cut back, so what did we cut back on? As I said before, there are two things this country is running on as far as exports are concerned. One is mining and the second is forestry. On a television station that I watch I see an advertisement from a lumber company every few days. It says that 23 cents out of every dollar that each Canadian gets comes from the forest industry. It may be right or it may be

wrong, but if it is right 23 cents out of every dollar is a lot of money.
We have cut down the experimental stations in the forest industry. I come from what was one of the best forest areas in Canada. Now there are no trees. We are now cutting about 10 million acres of budworm infected forests and do not have any trees. Canada has never done better in its reforestry program than harvesting one tree out of every ten. We plant ten trees, one lives. If it does not burn down in the next 60 years, someone will harvest it. In my area they are harvesting trees now that are probably not more than six inches at the butt and they are drawing them in tree lengths to Quebec. We in Ontario are so generous we can give them away. Yet we can cut back the stations that are our only hope of developing a perpetual yield forest. It is not like the mines; anyone will tell you that you should plant a tree every time a tree is cut. However, that has not been done. This is a good time to fly over Ontario to see the trees. The leaves cover the ground. It is like a mat. However, in most places there are no trees of any size.
In my area there is a tremendous fight about whether one particular sawmill or the other will get the new cut. Whichever mill gets the new cut will be able to expand; the other will have to close. In other words, there is enough cut for one sawmill, or a little for each of the sawmills to try and get along with.
The forests of Ontario are not being regenerated. This is probably true in British Columbia and, in fact, across the whole of the North American continent. There are no forests for tomorrow. We will be hard pressed to get along for the next ten or 12 years.
A new project has been started. It reminds me of when the hon. member for Qu'Appelle-Moose Mountain (Mr. Hamilton) was minister of agriculture. He talked about the ARDA program, taking eastern Ontario out of farming, where they only farmed stones and little sections, and putting it into forests. I understand that at the experimental stations in Guelph and Petawawa a hybrid tree has been developed that will grow a foot a month.


Jean Elizabeth Pigott: The Ontario government did that.


William Arnold Peters: The Ontario government is the main force behind it, but the federal government is certainly involved in it too.


Mr. Hopkins:: Don't let her lead you.


William Arnold Peters: It does not matter who developed it. I could give the name of the man in Guelph who did develop the hybrid poplar tree. The point is that this is an area in which there appears to be a breakthrough. In ten or 12 years you can get a tree the size of a 60-year tree. Therefore, this is not the time to cut off grants to the experimental stations. We would be cutting off our potential for the future in a field where there appears to be some resource. After all, you only need someone with a chainsaw to cut trees which can then be trucked to the
October 16, 1978

United States or somewhere else to help our balance of payments.
All across northern Ontario, including my area, there are headframes and rusty fences indicating where there once was a gold mine. I suppose that 20,000, 30,000 or 40,000 of these operations have been developed over the past 50 or 60 years. Most have a small shaft that goes down 200 or 300 feet. When they were in operation, they operated on a shoestring. Some of these mines operated when gold was $28 an ounce. A lot more operated when it was a maximum $35 an ounce. It is true that wages were not as high then.
Both the forestry and mining industry are labour intensive, other than in areas such as Elliot Lake or Sudbury where very large quantities of ore are taken out. Gold or silver is mined in a vein 40 or 50 feet wide. Therefore, we do not need a great deal of width to extract a considerable quantity of ore. These mines could be developed if there was some leadership given by the federal government. I am not in the position to say what kind of help should be given. Possibly a penny market could be established. There is no question that in most communities the money is available to develop these mines; what is needed is leadership.
Most Liberals have not followed the example of the Minister of Supply and Services (Mr. Goyer). When he attended a committee meeting not long ago, he was asked by the mining industry to provide gold coins that would contain exactly one ounce of gold with a fineness of .999. I was at that meeting. The minister stated that he would like to have a $100 commemorative coin put out annually but with considerably less gold content than that. However, he agreed with the mining industry he would be willing to have a bullion coin put out. Brokerage and securities people say there is a market for such a coin, one with about twice as much gold as that in production in Canada today. However, the framework to provide such gold coins has not been looked at.
The operation of the gold mines in my area would not require elaborate structures; it would be merely revitalizing a lot of holes already in the ground. A man could mine a few tons per year. In many cases, the gold would be worth $400 or $500 a ton of ore. During the depression, I worked in gold mines for $4.64 a day. Everything has gone up quite a bit since then, but not in proportion to the price of gold today. Today I could get $46 a day, not much in today's terms, working at hard labour in a mine.
People could be found to develop and work in the gold mines in these communities. There are already developed mines that could again be mined. Some of the present mines have extra mining capacity. Kerr Addison Mines in my area is operating at less than 1,000 tons a day, although it has a mill that will handle 5,000 tons.
Not long ago a man who had mined in Boston Creek died. He had operated a mine for ten or 12 years and had made enough money to live on. He went underground, drilled off, blasted, mucked it out, put it in buckets and hauled them to the top. He made enough money to get by for ten or 12 years.
The Address-Mr. Peters
That kind of gold mining is available in literally thousands of places in my constituency. In addition, silver is available.
I suggest the Supreme Court ruling told us something. It told the federal government that it has an obligation to see what happens with gold when it comes out of the ground. In Timmins, Kirkland Lake and Noranda there is an opportunity to create 5,000 jobs within six months. The people there are available and willing to work. Most of them are not qualified to do anything but the job they had been doing for a number of years but which is no longer available.
I now want to deal with the Lakeshore mine. There is more gold in the top 200 feet today than there has been during most of the lifetime of that mine. That gold has increased in value from $35 an ounce to $275 Canadian. Maybe the Americans will only pay $225, but in Canada it is $275 an ounce, almost ten times the amount it was worth when the mine closed.
These mines closed because there was not enough money with which to pay wages, though the most I ever got in the industry was $1.19 an hour in one of the best paid jobs and I really do not think the workers were overpaid. But if you paid the workers ten times that amount today there would still be a good deal left over from the sale of the product; the government could take that gold to any country in the world and get value for it. They could go to Germany or the United States and borrow on the strength of it. Why not develop the gold industry here?
I would have no objection to the federal government setting up a national mining corporation, as did Quebec at the provincial level, paying so much for the gold and getting it processed. I do not care what procedure is followed but I think a country is stupid, stupid, stupid when it fails to take advantage of the price of gold in these circumstances. I am not sure gold will always be at its present price. After all, the world might be broke tomorrow; it is already up to its ears in debt.
A few years ago the United States took out a loan from Germany and agreed to pay back that loan either in gold or in Swiss francs. Several months ago the U.S. Treasury went to Switzerland on bended knees asking the Swiss to put more Swiss francs on the market where the U.S. could buy them to pay off part of this debt. The Swiss authorities declined, saying there were not enough Swiss francs in the world to pay off that particular debt, nor was there enough gold in the U.S. Treasury, or anywhere else where the Americans could get hold of it, to pay that debt off. So, in due course, if the regular procedure is followed, the Germans will own the United States because they will take over its assets by default.
As I was saying, the price of gold may not hold up forever, but right now it is at such a high level that we should be mining it in northern Ontario, in British Columbia and, yes, in the maritimes. I am sure the hon. member for Central Nova (Mr. MacKay) could tell us a great deal about the history of the mines which were developed in that province and the reason many of them were unsuccessful, mainly because of the lack of sufficient capital. In those days gold was fetching about

October 16, 1978
The Address-Mr. Peters
$28 an ounce. Today, with the price around $225, even a cow pasture would begin to look good.
It is possible for us to ignore the studies which have been going on at our forestry stations, though we do so at great risk to the future. If present experiments turn out well-of course, there is no guarantee that they will-we can expect a perpetual yield from our forests. Young people today are not as stupid as we were. They believe in the value of preserving the ecology and I am confident they will find ways through experimentation to maintain a perpetual yield from those forests.
The Liberals and the Conservatives are always talking about free enterprise. I am not suggesting that mines should not be managed by free enterprise; my socialist friends would have a fit if gold production were to be nationalized. It has been done before without too much success because the price of gold was not very high and my friends did not think there was very much sense in digging a hole in the ground, taking out the gold and then burying it again in a vault or some place else. Of course, those who need it can use the gold to fill their teeth, though today one has to be very rich to afford gold fillings in teeth; I suppose people can only afford to have them gold plated. But surely we can find a way of helping to develop Canadian gold mines if only for the purpose of providing employment. Even if we are interested in helping our southern friends-we help them by sending our savings down there and by allowing them to put up factories in our country and take out the dividends-there are some things we can do very well here; for example, long-distance transmission of electricity.


The Acting Speaker (Mr. Turner):: Order. I regret to interrupt the hon. member but the time allotted to him has expired. He may continue, however, with unanimous consent. Does the hon. member have unanimous consent?


An hon. Member:: Agreed.


William Arnold Peters: I will only take half a minute more, Mr. Speaker. I was pointing out that we do have certain resources in this country, that we had better quit playing around and make sure that we use them. I told some of my young people who are smart at developing things that they would be able to get a grant for development of solar energy, but when I sent them all the information they found that without a "gross" of half a million there was no point in even applying for a grant. Mr. Speaker, development in this country will come as a result of innovations by young people with knowledge of these subjects, not from companies of size. Let us begin doing the things we can do best, and develop skills and resources internationally, particularly in mining and forestry because those industries could employ a lot of people.


Mr. Ralph Stewart (Cochrane):: May I call it six o'clock, Mr. Speaker?


The Acting Speaker (Mr. Turner):: It being six o'clock I do now leave the chair until 8 p.m.
At six o'clock the House took recess.
[Mr. Peters.)


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
The Acting Speaker (Mr. Turner):: Order, please. At six o'clock the hon. member for Cochrane (Mr. Stewart) had the floor.


Ralph Wesley Stewart: Mr. Speaker, first I would like to join with those who spoke before me in congratulating the mover and seconder in this debate. In particular I would like to underline the important contribution made by the hon. member for York South (Mrs. Appolloni) and her courage in expressing her opinion regarding respect for the lives of the unborn. I agree with her stand and I congratulate her.
The main concern in our country today is the economy. Reasons for the difficulty facing us are many and varied, but there is no doubt that work loss caused by strikes and so-called working to rule must bear a good share of the blame. We have seen what has happened in England and in Italy as a result of frequent work stoppages. Surely no loyal Canadian can wish for the same thing here.
In August the Prime Minister (Mr. Trudeau) said that Canadians are fed up with the nonsense going on in the Post Office. I can say without a doubt that my constituents are fed up and, indeed, so are many, many others who have spoken to me on this subject. In fact, the attitude of many Canadians is "fire the bastards"! While I can understand this kind of frustration, I do not personally advocate mass suspension; but it is obvious to me that a much tougher stand has to be taken, and this stand must extend to all essential services.
I do not know who coined the phrase "the right to strike". How can it be called a right to disrupt a country? Some people refer to the right to strike in the same way they talk about the right to free speech and the right to freedom of expression. The term I prefer to use is the "option to strike," and I say there should be no such option, at least in essential services.
1 think an analogy can be made between a strike and a declaration of war, because in both cases they are a last resort when everything else has failed. In addition, they both create a great deal of disruption, one destroying the physical environment and the other creating havoc within the economy.
I have always felt that a strike should be the very last resort, but in recent years it has become far less than that and is used even as a tool for arbitration. Obviously, something had to be done to change the present system because it simply does not work.
Perhaps strikes have become outmoded. Perhaps they should be set aside in favour of some other means of settling labour disputes. Indeed, the prominent American labour leader, George Meany, said a few years ago that strikes no longer served the purpose they had in the past and were becoming obsolete. It is abundantly clear to me that strikes serve no useful purpose when regarded in the over-all context of the disruption that is created in our country as a result. If we do not go as far as doing away with strikes entirely, the least this
October 16, 1978

parliament can do, if it is to act responsibly, is to legislate against strikes within the public service and in other essential services to Canadians.
When a strike or walk-out causes a necessary industry or service to grind to a halt, the public indicates its displeasure. However, too often the degree of their disgust is strictly proportional to their own discomfort or loss. Too few citizens think or feel beyond their momentary personal or family inconvenience.
The average resident of Montreal or Winnipeg, for example, fails to realize how much more terrible an interruption of rail-ferry service becomes for the people of Prince Edward Island, Newfoundland or Vancouver Island than for himself. If he lives in Nova Scotia or Alberta, he may not think about how interruption of air freight in the Northwest Territories or to the isolated settlements of James Bay and Hudson Bay may threaten the health and the very lives of those in the hinterlands.
The householder of Saskatoon and Fredericton does not get terribly upset if the sanitation work forces of Hamilton stay at home so that garbage piles into hills while flies and rats hold festival. If he lives in Toronto, suspension of electric or gas service to Hull, Quebec or Vancouver is not nearly as despicable a thing as the same thing happening in his own city. What is it to Mr. Average Citizen in Charlottetown or Victoria if a strike of telephone operators cuts off emergency messages to doctors, hospitals, ambulances, firefighters or police in North Bay or Windsor? Does it matter if a business in St. John's or another in Calgary is forced to close its doors and send its employees home because a postal strike has suspended transmission or sortation of mail?
If the significance of an industrial dispute weakens with its distance from home base, one should not be surprised that remoteness in economic terms is even less well realized. Interruption of stevedores' work in Thunder Bay or pilots' duties on the St. Lawrence seaway may cause grain to choke elevators and pile up on farms. Beyond that it may wreck an international agreement with Great Britain or China, or it may even bring hunger closer to helpless millions on the other side of the world.
Every disruption of utility or production line inevitably and inescapably raises the cost of goods and services throughout the whole market area, usually beyond that area, and prices rise with costs. Reduction or disappearance of income in any segment of the economy results in the slowing of business, an increase in unemployment, the disappearance of profits which would otherwise be available for investment in expansion of existing enterprises or the founding of new ones. New cost burdens are thrown on the welfare apparatus of municipal, provincial and federal governments, forthwith translated into bigger levies upon every taxpayer. The strike to obtain higher wages simultaneously and inevitably is accompanied by higher costs and higher taxes, leading to the next round of demands and strikes.
The Address-Mr. R. Stewart
Are we in Canada waiting for a general strike which strangles the entire population before doing something about it? Are we to endure forever this pattern of big or little blows, of short or prolonged agonies? Are we to endure everyone facing another work stoppage? Are we to endure some new example of injustice hitting first one group of workers, then some employers, then whole communities of consumers, and even the entire nation?
Most Canadians would agree that when a nationwide strike cuts a service from the Atlantic to the Pacific, the government has to step in. Indeed, any hesitancy on our part would be regarded as weakness by the majority of Canadians. Quite aside from the widespread hardship for the whole population which may be imposed by a work stoppage in a vital industry or service, also the following should be considered. It is ridiculous that the practice should have grown up in this country of meeting the more serious crises by the adoption of special legislation put before a specially convened session of parliament or legislature. Surely it should be beneath the dignity and reputation of a sovereign state that the parliament of Canada should be summoned to end a railway strike or an air controllers strike; that the legislature of the province of Quebec should be convened to get teachers and public servants back to work or the government of the province of Ontario should end a transportation paralysis. Laws should provide a structure within which foreseeable disputes can be settled in a just and orderly manner; they should not be improvised to meet sudden emergency.
The laws of the modern state may not yet give adequate support to unions seeking to fulfil their functions under such conditions, but constantly they are being improved as experience accumulates and as a clearer concept of social justice is achieved. Present standards have not been reached easily. Unions look back upon a history of struggle against odds. However, unions are long passed the stage when they should feel threatened, harassed or unprotected. Now they are part of the establishment, whether they wish to admit it or not. They are not government and should never be permitted to act as if they were.
The state is the instrument which serves the entire society. The whole society must guard jealously against being used by non-political powers, wealth, labour unions or pressure groups based on religion, sex, race, ancestry, professionalism, education, or by the idle, the criminal and the violent. The point is that unions are no longer oppressed but are a part of the estblishment. They can even look down on the non-union labour in some instances. In the over-all picture the only group that is sacrosanct is the whole of society, for whom the political state must be able to speak and act.
It follows then that the state must limit the powers of the corporations so that its citizens may remain politically free. Similarly, it must limit the power of worker organizations to whom some of these citizens belong. No class or group within our nation should be in a position from which it can hold the whole population or large segments of it to ransom. Unions

October 16, 1978
The Address-Mr. R. Stewart
must be controlled for precisely the same reasons that corporate entities within society must be controlled-so that they may not obtain a stranglehold upon the political organism which alone must think, speak and act for all.
Those who find their jobs eliminated by the cessation of essential operations, who find their costs skyrocketing as efficient industrial and merchant activities are halted, and those who find health and education threatened for themselves, their families and neighbours by disputes utterly beyond their control, can find protection only in their instrument and servant- the state or government. Unemployment, reduction of food supplies, a halt in the building of homes, are just as painful if they result from union action or are imposed by slum landlords or corporations.
If we were looking for a place to lay the blame for labour problems, one could blame the government, management or unions. Regardless of whose fault it is, the important thing is to find a solution, one which is better than what we have at present. I believe the solution is known and it can be imposed justly. The way to impose it is through the control of law. On this matter I wish to quote Abraham Lincoln as follows:
The reign of law and the maintenance of the machinery for the administration of justice, inadequate as they are, are man's only possible defence against the reign of violence, tyranny and unqualified injustice. Without these the weak man and society as a whole become prey to the unscrupulous and the strong; the individual becomes the victim of the mob.
I repeat, the rule of law is the only way to a solution. There is scarcely any activity of men and women in society which is not brought within the scope of law. Whether it be the quality of food or clothing bought for the family, a commercial form of recreation, the manufacture, sale and purchase of vehicles, all aspects of housing or the production of utilities, all are within the ambit of law.
Codes set standards of health and working conditions, outlaw discrimination, provide a structure of rights for unions and their members, establish obligations for employers, set out procedures for negotiation and conciliation. But strangely when it comes to strike action, the one form of action which affects every man, woman and child in a multitude of ways, it substitutes anarchy for order and actually legalizes a form of blackmail aimed at employers, fellow workers, the state and the whole of society; it is left completely open-ended.
Outside of criminals, it is difficult to think of any segment of society which is not brought under the control of law. It seems odd that whenever we discover leaks in the structure of protective law, such as juries or other public bodies, an attempt is made to plug the leak. But in the case of strikes, it seems that society simply stumbles on from one strike crisis to another.
At the beginning of my remarks I indicated that all strikes should be brought within the rule of law in the same way as other activities which affect society. But all strikes are not equal in importance and a least those which affect society seriously should be brought under the law. To categorize that which is an essential service is relatively easy. They include all industries and services, the uninterrupted maintenance of

which has become essential to the survival of the modern western community. Those industries and services which are categorized by law as being essential to society would not be permitted to strike.
Compulsory arbitration may be anathema to all orthodox unionists. But since the existing methods have not worked, it is time that we choose this course and stick by it. The fact is that our society has continued to take great risks in permitting services and industries, which are vital to survival, to be interrupted time after time, while the dangers and costs of interruption multiply.
It is immaterial whether the fault lies with the employer, the employee or the government. The time has come to call a halt to disruption. No one should be compelled to work in essential occupations, but if one prefers to do so one must forgo the option to strike in return for compensations guaranteed by law and administered by arbitration courts which are as far above influence and interests as are the skilled courts of criminal jurisdiction.
It deserves to be repeated that while social action of this sort may have a shock effect, it is really not sudden or revolutionary. We have been moving gradually along a straight path for many years. That path has had to be cleared of trees and underbrush like any other pioneer road in new country. The route has had to be explored and blazed before it could be cleared. But it has been apparent to any discerning eye that the path is marked "Law" with a capital "L" and that the destination point is "Justice" with a capital "J".
For labour peace and social order the price which unions in the essential services must pay is the relinquishment of the so-called right to strike. The price which management must pay is a levelling up of compensation, not only in dollar terms but in guarantees of job security. Both labour and management must learn to live with compulsory arbitration as the seal of the customary processes of negotiation, conciliation, mediation and procedural rules. All elements, including society, will be rewarded by escaping the incalculable costs and the ever-threatening hazard of periodic interruption of production and distribution.
Other reforms must follow and I should like to mention some of them briefly. One is mobility of labour. If a large and important class of workers is to be deprived of its major escape valve, job security alone is not sufficient compensation. It must also have improved opportunity to move into different types of work. Some of this mobility is already in place and is facilitated by such things as retraining programs, employment finding organizations and by means of the payment of costs of moving to new occupations. Such programs must be sufficient so that a worker feels confident of being made mobile.
The second pathway to be brushed and paved follows as a corollary to the first. A worker moving from one job to another must be assured of the portability of his pension rights, whether he moves into a new type of work or into another
October 16, 1978

province. Considerable progress has taken place in Canada already but the provinces which have not acted must do so to assure the maintenance of full pension rights.
It is time that new methods be put into practice for the settlement of labour-management relations. I contend that to strike is not the God-given right that some people advocate. If society suffers to the extent that it has in some countries, let us learn from the mistakes of others and establish a system of arbitration which will obviate work stoppages in the future. There may be circumstances in which the strike weapon is a legitimate one, but others in which its use is a crime. In the case of essential services, such as the postal service, it is a crime and should be treated accordingly.


Elmer MacIntosh MacKay: Mr. Speaker, at the outset, of course, I want to congratulate the hon. members for York South (Mrs. Appolloni) and Verdun (Mr. Savard), respectively the mover and seconder of this Address in Reply to the Speech from the Throne. They have done an admirable job under difficult circumstances I would say, sir. I also wish, as other members have done, to pay very sincere tribute to His Excellency the Governor General and his good wife who have carried out, with such distinction and warmth, their responsibilities during their term of office.
This particular Speech from the Throne was almost obsolete, I would suggest with deference, about 30 minutes after its release. Talk about a sense of deja vu; this particular one in its antecedents and in its premises simply cries out for non-acceptance and for scepticism. It does little to meet the challenges of our country. It does little to meet the needs of our country. Nor does it signal the end of the posturing and the economic failure of the Prime Minister (Mr. Trudeau).
I was very interested in the remarks of my friend who just spoke. He castigated big labour, he castigated big business, but he ignored the biggest villain of all in this country at the present time, and that is big government; a government which has failed so signally to protect its citizens from the excesses of either big labour or big business. It is obvious that the Prime Minister in his visit to Bonn, Washington and other places did not really learn anything as far as the need for a different posture in his approach to leading this country is concerned.
He and his cabinet should refer to a very interesting book written by a former secretary of the treasury of the United States, Mr. William Simon, called "A Time for Truth". Mr. Simon points out that the reason for discussing economic issues is not to inspire a national passion for bookkeeping, but to inspire a national awareness of the connection between economic and political freedom. The connection is real and it is unbreakable, and to lose one is to lose the other.
In this country that is exactly what is happening to a government that favours manipulation and intervention. They are creating economic alternatives which are practically inescapable. Such government can confiscate, it can redistribute what is confiscated, it can spend more than it possesses, but there is one thing it cannot do, and that is produce wealth. That is what this government has not yet learned. It has not
The Address-Mr. MacKay
yet learned that the productive partner in our society is the private sector.
The government has maintained, belatedly, that the private sector does have some responsibilities, and the private sector does have the capacity to produce wealth and to spark a recovery in this country. But the economic climate that has developed under the Prime Minister and his cohorts, a climate which is so terrible and has resulted in such unprecedented high interest rates and deficits, is one which discourages and not encourages the private sector, which this country and this government belatedly is now depending on to right the harm it has done over the last ten years.
The cutting of taxes and the untangling of red tape is absolutely essential if we are to make any progress. One possible answer lies in the theory of potential budgeting. That is one possible answer to these difficulties. Governments must rearrange their priorities. They must consider the necessity in some cases of spending money in order to make money. The difficulty is, this government has been spending money for all the wrong reasons. There is a big difference between buying a Cadillac and buying a dump truck. With one you can make money and deliver something of value. With the other you can drive around, perhaps back and forth to the House of Commons or to your place of business, but that really does not do very much for the economy, unless you are pushing a consumer economy and trying to consume energy.
You can spend money wisely to make money. You can reduce taxes and get more revenues as a result. President Kennedy proved this when he, over the objections of many of his financial people, reduced taxes in the United States by approximately $10 billion and was rewarded by almost double that in increased revenue.
The Chancellor of Germany, Ludwig Erhard, quickly realized after the last war that if you reduce taxes to an acceptable level it will produce an unprecedented response from the people. Andrew Mellon did the same thing in the 1920s in the United States. This government is absolutely incapable of recognizing that it is taxing our people right into the ground. This government does not even have much interest in indexing the capital gains tax, or experimenting with any of the equity that is possible when taking a look at our tax system. All this government can do is have a Pavlovian response when someone on this side of the House puts forward some positive theories in this regard.
It is very amusing to see what happens when the Prime Minister and the Minister of Finance (Mr. Chretien) try to counter the criticism. I think sometimes that the Prime Minister must be a bit of a baseball player. He is leaving his Minister of Finance in the House of Commons under considerable fire from the heavy hitters and the arbitragists in the financial centres of the world while that gentleman throws his verbal knuckle balls around the House of Commons and gets wracked up and our poor economy sinks lower and lower, just like the batting averages of some players in the World Series. I

October 16, 1978
The Address-Mr. MacKay
would not want to try to negotiate next year's salary on the batting averages in the economic league of either the Prime Minister or the Minister of Finance. The only thing we can be thankful for is that he is not a playing coach and tried to assume the portfolio himself; otherwise we would probably be even worse off.
The concerns of this country, as reflected from the part of Canada that I come from, are growing steadily more pronounced. We have not seen anything constructive being done to cure our transportation inequities, and we have not seen any responsible capital intensive projects of a major nature to help us. Little has been said about a corridor road, although Maine, an idea which has been brought up from time to time-it has been brought up, in order to be fair, by members on the other side as well-a road which would, by its very nature, cut a couple of hundred miles off the journey and greatly improve our accessibility to markets in central Canada. Such a road could be built in partnership with our friends in the United States and do a great deal to help our economy and to straighten out inequities in a very practical way.
We should have had a far greater and more gracious acceptance of our historic rights for our offshore resources than we have had. Under some prodding the government finally conceded that Nova Scotia could have three-quarters, subject to certain of their own claims coming off the top. This is absolute nonsense and a denial of the rights and the traditions of Atlantic Canada.
For example, the province of Newfoundland is a province that has the capability, right, capacity and historic claim to its offshore resources. This government, however, will not even concede that, subject to the powers of the National Energy Board, national energy policy, environmental standards within a federal jurisdiction, the province of Newfoundland has the right to proceed on its own level to develop and exploit these resources, knowing full well that that province, as my own province of Nova Scotia, can handle this development far better than a centralist government. To make matters even worse, the government does not appear to be willing to apply customs and immigration and other federal statutes to the point where it is protecting the rights of Newfoundlanders, against off-shore drilling, particularly at this time, for the benefit of inshore workers and producers of local products. It is nothing less than a disgrace.
As far as the fishing industry is concerned in Atlantic Canada, time after time the member for South Shore (Mr. Crouse) has pointed out to this government the ludicrousness of its policies, the inequity of its quotas, the fallacies of the ICNAF arrangement, and that hundreds of thousands of tons of the very best fish in the world are being dumped by fishing captains to avoid these silly laws. The government has refused to listen to the hon. member despite the fact that he is one of the few members in this House who has the practical experience to back up what he is saying. He has actually operated a fishing fleet and therefore knows of what he speaks; but these people opposite still do not listen.

Regional disparity in the past has been a buzz word with this government. In some of the Speeches from the Throne in the not too distant past, it has been said that there is no higher priority than solving regional disparity. Well, Mr. Speaker, one would never know that. As the failure to solve regional disparities becomes more and more manifest, so does the mention of its continuing support become less and less obvious in successive Speeches from the Throne. Right now we have energy costs that are almost prohibitive for any industry that would seek to establish itself there, yet this government up to this point has not been willing to press ahead with any meaningful, large capital cost projects that would see as their objective the solving of this problem by making it possible to take in electrical energy from parts of Canada where it is available by means of a national power grid.
This government has commissioned yet another study of Fundy tidal power. I do not know how many studies we have had, but it is good business for the consultants and that is about all. That is another sore point, consultants. For the money this government spends on consultants, we could probably fuel an economic recovery in at least one of the Atlantic provinces on that expenditure alone, which sometimes has approached $1 billion on an average over the last few years. This government absolutely refuses to spend its money and marshal its priorities in a way that is good for the country.
The Minister of Transport (Mr. Lang) is an interesting man for he is practically a one-man cabinet. He is minister in charge of the Wheat Board, Minister of Justice and Minister of Transport. The people of Canada have not seen an act like that since Harpo, Groucho and Chico Marx, and he has done it all by himself, just he and his JetStar. The Minister of Transport and his departmental associates have paid out, for example, over $1.5 million, as evidenced in a belated answer I received to a question on the order paper that is over a year old, to consultants, Phillip Binehaker and his group and a well known Toronto law firm, for some work having to do with the Pickering airport.
They are still beavering away at this project, despite the fact that the government of Ontario and the people of Toronto have indicated that they do not want another Mirabel, a monstrosity that not only is an economic drain, having run up a deficit since it opened at the average of approximately $40 million a year, and which is an international model of how not to build an airport. This may result in the closing down and curtailing of a perfectly good airport in Montreal which continues to make money. That kind of use of our tax revenues and how to get value for money spent is what is causing a great deal of the difficulty in the past ten years in those areas of the country where there is a real need for sound infrastructures. Such examples as the corridor road, the development of minerals offshore and improvements that are required in our fishing industry are only a few of the projects that could have been funded.
The government, despite pleading from their own members as well as members on this side, has steadily refused to provide even the most rudimentary of amenities to the fishing industry,
October 16, 1978

as the hon. member for South Shore I am sure will agree. They could in a few of the communities around our coastlines put in a few slipways, a few lights on the wharves, a few things to hoist heavy crates off boats, and this would do a tremendous amount.


Mr. Crouse:: A little more dredging.


Elmer MacIntosh MacKay: Yes, a little more dredging. That is another story-the millions and millions of dollars over the years that were wasted on dredging. We wonder if the dredging in some cases was ever done, but that matter is being proceeded within the courts, and perhaps some day we will have the answers.
There is no point in going on ad nauseam about examples of government waste, but the refusal of the government to come to grips or even to admit that this is occurring is a reason for the tremendous animosity that is building up, not just toward unions and business, as my friend from Cochrane (Mr. Stewart) said, but toward the government itself.
The Minister of Public Works (Mr. Buchanan) said today in the House that he is quite satisfied with the report of the standing committee on finance in the other place, as if that report justified and vindicated the things that his department was doing. He must be either so unaware of the practical realities or so regimented that he does not understand what is going on in his own department. Let me put on record some of the statements made before the committee which took a look at the Les Terrasses de la Chaudiere project, which is only one of many projects that one could choose. Page 90 of the Senate report states that the Department of Public Works-
-with the approval of the Treasury Board, failed to observe precautions taken as a regular course in all other projects for the acquisition of space... The committee's inquiry into the details brought out evidence that these agreements have committed DPW to pay rates for the space involved well beyond the prevailing private sector level.
It states also on page 89:
The committee's inquiry into the details of the four lease-purchase agreements made in the Ottawa-Hull area brought out evidence that these agreements have committed Public Works to paying rates for this space well beyond the prevailing private sector level. The two agreements for the buildings in Hull have brought the department's judgment into question in parliament and the press. In entering into them the department, with the approval of the Treasury Board, failed to observe precautions taken as a regular course in all other projects for the acquisition of space. No tenders were called and proposals made by the owners for space not yet in existence were accepted.
If that kind of commentary can be interpreted as a vote of confidence in a department, then there must be a new standard of acceptance.
As far as matters of security are concerned, the government has again failed to be honest with the people; they have failed over the years and months to answer a very simple, rudimentary question about what they intend to do with this iniquitous section 41(2) of the Federal Court Act. This section has become so infamous that it really does sanction executive privilege without judicial review in this country. Sum it up anyway you like, that is the bottom line. Any country that would allow a statute like that to remain on its statute books in
The Address-Mr. MacKay
times like these, having consulted and been in touch with the attorneys general of the provinces, as the former minister of justice indicated to me in this chamber that he had, and without making some modification to it, has got to be extremely unrealistic and insensitive.
This government has not lived up to its responsibilities in the way that the Canadian people have a right to expect. Rather, it has shilly-shallied, delayed and asked people to have confidence. What the government is really saying is, "Let us be your confidence men." There is no reason why they should extend this parliament-if they had any confidence in themselves. If they had real confidence they would have called an election. The fact that we are in this chamber at this time indicates their tremendous lack of confidence in themselves.
How can the people of Canada extend to this Prime Minister that which he appears to want more than anything else-a mandate to change our constitution? Supposing someone hired the Prime Minister to run a large business-and I do not think many people would-and then over the last few years the corporation had systematically fallen into a deficit position- had lost large markets, good will, its credit rating had been damaged, its retained earnings depleted. In other words, it had been weakened to the point that its stock in the business community was in the same state as our dollar is in the international community. Then he came up with the great idea of radically changing the way of doing business. He proposed to computerize everything, change the distribution methods, turn the thing upside down and make a lot of money, saying, "I want you to have faith in me." If he had done a good job during the past ten years and had increased the retained earnings, held his own in a challenging market and demonstrated a grasp of practical realities, then I think one would be justified in saying, "It sounds unorthodox and it is untried, but based on your past record, we have confidence and we will authorize you to take us into these uncharted waters."
I can see you doing that, Mr. Speaker, because you are logical, reasonable and an admirable individual, but I cannot see our permitting anyone with his record to do anything further, he having demonstrated his incompetence under the present set-up. Yet that basically is what the Prime Minister is asking the people of Canada to do.
His reach for constitutional reform is frustrated by his lack of grasp of practical realities. That is the greatest frustration that I think the Prime Minister and this government will have to face. They have failed miserably in their stated objective of reducing regional disparity and of bringing us a more open society. They have even welched on the solemn commitment to do something about the War Measures Act. I believe the anniversary of that infamous occasion is today. A solemn commitment was made that it would be discussed in this House and steps taken to do away with it, but as usual nothing has come of it. Yet the Prime Minister and his government are asking the people of Canada and members of this place to trust them to lead us into uncharted waters and change the very basis, in many respects, of our constitution.

October 16, 1978
The Address-Mr. Lee
If the government wanted to do something constructive and work with the other place, they should take one step at a time. First of all, they could make the Senate an elected body and no one would quarrel with that. At one time the United States Senate was an appointed body but it ran into difficulties in the early part of this century. It is now a very admirable institution and I suspect part of the reason is that it has become an elected body.
I sincerely hope that in the few months left in this parliament the government will bring forward some concrete legislation which will be handled with dispatch. We on this side would be pleased to do that. Mention was made today of the Bank Act which needs to be reviewed and I think the government and the Prime Minister would find us very co-operative in that regard.
Many other things need to be done, such as tax reform. Let us experiment a little with reducing or at least indexing some of the capital gains taxes which are the noxious glue gumming up the wheels of free enterprise in this country. We cannot afford a capital gains tax in this country. Anyone who has examined it can see that it is a regressive tax which stops people from taking a chance and doing things which they could do with a more reasonable approach to taxation.
The government could recognize that many people who purchase stocks in Canadian companies wish to provide for their retirement or to educate their children and should deal with them differently from the speculators who deal in nonCanadian securities. Instead of that, the Prime Minister, as he clings to office for the last few months, is going to continue to be obsessed by his constitutional pretentions. As far as I can see he has never demonstrated that he is particularly qualified for this task. Certainly some of his colleagues and some distinguished senators from his party have been most savage in their criticism of what he is attempting to do.
I would hope that his proven lack of capacity to lead this country along the road to success and prosperity which some of his own predecessors in his party who held the highest office predicted for us will be a strong warning, a red flag and all the other warnings that are necessary to the people of this country and members of this place so that they will not permit him, of all people to vary our constitution. Let us wait until we have a new parliament, a new leader, a new prime minister; let us wait until the present cabinet, which, as someone said, is probably the largest collection of pygmies outside the Belgian Congo, has had to go to the people and try to get another mandate. Let us then talk about making changes to this constitution of ours.


Some hon. Members:: Hear, hear!


Mr. Art Lee (Vancouver East):: Mr. Speaker, I would first like to extend my sincere congratulations to the mover and seconder of the Address in Reply to the Speech from the Throne. Having had the distinct honour and privilege of doing so myself, I know how proud their constituents must feel in

having their members move and second the Address in Reply to the Speech from the Throne. It is a privilege not only in recognition of the hon. member for York South (Mrs. Appol-loni) and the hon. member for Verdun (Mr. Savard) of their own particular talents and capabilities. It is a distinct recognition of the particular constituencies and people they have the honour to represent in the House of Commons.
I also extend greetings on behalf of my constituents to His Excellency the Governor General and his wife on the excellent Speech from the Throne. I wish him well. I hope he will be able to continue in his portfolio and that we will not be seeing the end of the fine work he has done in serving Canada over the past few years.
It was very interesting to listen to the speeches delivered last Thursday by the leaders of the various political parties. I listened very attentively to the Leader of the Opposition (Mr. Clark), the leader of the New Democratic Party the spokesman on behalf of the Social Credit party and, of course, the leader of our party, the right hon. Prime Minister (Mr. Trudeau).
There is no question that the Prime Minister did an excellent job. It showed this country and those in this House that he is truly a leader of distinction. He showed in which direction this country should go. The economic program and the discussion about the constitution and national unity were excellent. His speech really hit the nerve of what Canadians want to hear.
The speech by the Leader of the Opposition was rather interesting. He raised the spectre of many old scandals about which we have heard off and on over the past few years. All the opposition wants to do is talk about scandals.
We in this country have a unique and sound tradition with regard to our judicial system, how it is thought of and how we approach it. A person is always thought to be innocent until proven guilty. The Leader of the Opposition raised the old problem of Sky Shops and Senator Giguere. He stood trial and was cleared, yet the Leader of the Opposition raised the matter again. I sat in amazement. These people talk about our very fine traditions and what is fair. However, in his speech the Leader of the Opposition did not once mention that Senator Giguere had been cleared.
The Leader of the Opposition talked about the Royal Canadian Mounted Police. As Parliamentary Secretary to the Solicitor General, I had first-hand experience with the way the opposition attacked the government on this matter. They talked at great length about the need for a royal commission and the rightness of the Keable commission in the province of Quebec. When evidence brought forward showed there was need for a royal commission, one was established. During the fall and summer the opposition attacked the government, saying that all it had done was create a royal commission to cover up and that it was not going to do the job. They even questioned the appointment of the head of that commission, Justice McDonald, a very fine person.
October 16, 1978

The opposition has attacked the government with regard to the independence of the judiciary. I recall the so-called alleged judges affair. There they attacked the independence of a member of the judiciary, Justice McDonald of the Supreme Court of Alberta. I really wonder about the duplicity of the kinds of arguments raised by the official opposition. They must realize that once a person is appointed to the judiciary, we have to respect him as an independent person.
During the alleged judges affair, there was lecture upon lecture and question after question in question period about how the government was upsetting the independence of the judiciary, tampering with their integrity and the principle of independence of the judiciary. The official opposition keeps coming down on one side of an issue and then on the other, as it suits them.
The whole issue of the RCMP is an excellent point. It is a very fine institution in this country, well respected in Canada and throughout the world. The opposition soon found that the people in this country were asking what they, the opposition, were doing. They were told that they could not win elections and gain power by riding on the backs of the RCMP. Canadians were telling them to cool off.
For the last while, the opposition have not been attacking the RCMP. I think the opposition found that by attacking that institution they were attacking the men and women who make up the RCMP, some very fine people. I have had the opportunity of meeting members of the RCMP in the smaller communities in my province, the Northwest Territories and the Yukon. They not only perform the duties of the police force but become involved in the community. One often finds the local constable directly involved in community affairs by acting as coach of the local baseball or hockey team. They help to solve the serious problems of juvenile delinquency in the communities. They are involved in diverse programs. This is what the opposition members faced when they returned home.
By attacking this very fine institution, the opposition found they were attacking the people. When they were told they were not going to be elected by attacking the RCMP, they backed off. We have not heard much complaint about the RCMP from the opposition recently.
We have heard about any number of scandals from the official opposition in the four years I have been here. The hon. member for Central Nova (Mr. MacKay) said that the government could put forward a big economic program if it tallied up all the dollars that have been spent on consultants. At the same time the opposition complains that the government does not listen enough to outside people, that it listens too much to the civil servants.
The Leader of the Opposition complained about the so-called elite in the Prime Minister's office running this country. I wish the opposition would make up their minds. Which side are they on? Are they saying the government should not listen to anyone other than civil servants? There are many good deputy ministers who are advising the government. Are they saying we should not have outside consultants, people
The Address-Mr. Lee
who are expert in their field and close to the regions or specific problems they are asked to deal with?
On one hand the Leader of the Opposition says that all we have is a group of elitists in the Prime Minister's office who are running the country. I really do not understand this. The opposition comes down on one side of an issue and then within a month, week, day or even an hour comes down on the other side.
This is the party which hopes to replace us in leading and governing this country, but I certainly do not think it will. We hear members of the official opposition complaining about the restraint program announced by the government in August and discussed in great detail in the Speech from the Throne. They say it is not a real program but just cynical politics to gain votes, yet I have heard a number of opposition members who represent constituencies in my province complaining about some of the cuts. I have heard them complain about how the cuts will affect the province of British Columbia. They have complained about cuts with respect to weather ships. I have heard opposition members from the Atlantic provinces complaining about cuts which will affect weather reports there. In my own city I have heard opposition members complaining about the cuts because they will affect federal programs, particularly public works projects. There will be cutbacks with respect to the federal government building which is planned to be built in the federal riding of Vancouver Centre. These are the same people who talk about cynicism and about the government restraint program not being a real program, yet they ask why we are cutting this and that.
We talk about tightening up unemployment insurance, and hon. members opposite ask why. 1 remember that they often used to complain that it was too generous, but now we are cutting back. Perhaps we were too generous, so now we are trying to divert some of those funds to job creation programs. In this regard members of the official opposition and of the New Democratic Party complain that we are being too tough.
I think that the government's program boils down to three R's, restraint, reallocation and renewal. Restraint means even tighter controls on government spending. We have slashed $500 million from current expenditures while slicing another $2 billion from next year's budget. As well as making government leaner and more efficient, our belt-tightening exercise will leave more resources with the private sector for job creation.
This is exactly what the hon. member for Central Nova (Mr. MacKay) was talking about. He says we are not leaving enough to private enterprise not allowing private enterprise to produce. He says that private enterprise is the one sector which truly generates wealth and that we should allow it a little more freedom. The hon. member talked about indexing the capital gains tax. Why not examine the possibility of eliminating the tax entirely? Why even talk about the question of indexation? Why not examine the recommendation of the Bryce commission which talked about the elimination of the

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capital gains tax? Hon. members opposite like to tinker around. They like to be on the one side as well as the other. Perhaps they should decide whether they do want elimination of the capital gains tax.
The second of the three Rs of the federal government program is reallocation. Within our reduced budget we are taking away $1 billion from certain departments and programs in order to spend it where the present need is greatest. I think this will mean more jobs for the unemployed, more help for elderly Canadians with low incomes, more help for low and middle-income families with children and a faster growing economy.
The government's economic package does not signal a radical departure from previous policies. I think it has been labelled by members of the official opposition and by some members of the media as a deathbed conversion.
At a convention of my own party I once delivered a speech about restraint, and I can see that since 1975 the government has followed a program of restraint. It has limited increases in government expenditures to a level below the rate of growth of the gross national product. In the same period we have fought inflation in order to cushion the most vulnerable of our citizens against the ravages of inflation. Finally, we have given a high priority to economic growth and the creation of jobs for our young people. What cutback and reallocations really represent is a strengthening of existing programs and a reaffirmation of our long-standing goals.
I listened with great attentiveness to the hon. member for Central Nova when he spoke about turning everything back to free enterprise. I do not think we have really had free enterprise in this country, unless the free enterprise about which members of the official opposition are talking is the free enterprise of the days of the robber barons or the Carnegies. 1 do not think I particularly want to return to that era. In that era free enterprise did not really care about the working people. Working people did not have pensions or health plans. When people were unemployed, there was no such thing ar unemployment insurance.
This is the kind of thing which leads me to think that members of the official opposition want to throw out the baby with the bath water. They want to turn to the old, free-style free enterprise where the needs of average working people are forgotten. Such needs are medicare, unemployment insurance and the job-creation programs which this government has undertaken and, 1 think, very effectively. I do not know what members of the opposition are attacking when they ask for more cutbacks and more restraint. I think if we were to do things the way they want us to, we would throw the country into a tailspin and cause a recession the likes of which this country has never seen.
Members of the official opposition talk about redistribution of income. They talk about their mortgage plan. I must agree that the principle behind the plan is not bad, but judging by the way the hon. members opposite are talking about it, the program would be ludicrous. I come from a working man's riding, and I do not see anything in the plan to help working

people. Many people in my riding are renters. The program would do nothing to help them. How would it help people who rent? Should those people not be allowed to deduct something from their incomes? Should they not be allowed to deduct part of the payments they make to their landlords?
Because of the marginal rates and the effective rates in our Income Tax Act, those on higher level incomes usually receive a better advantage from any proposal which does not really take into account the effect of marginal and effective rates. That is why the Minister of National Health and Welfare (Miss Begin) announced changes to the family allowance and tax credit of S200 per child per year.
I remember reading about this in the Carter royal commission report as well as in the report of the Advisory Council to the Department of National Health and Welfare. The Carter commission and the advisory council were involved in the area of national welfare, and they advised the government that it should implement a tax credit program.
We do not find that in the program of the official opposition. It is very clear that the proposals of the official opposition would not help people on low and middle incomes. Those at the top who earn $50,000 and who have large mortgages would really be laughing, but the proposals of the official opposition would not help the average working Canadian. The mortgage interest deduction program has to be the greatest political gimmick I have ever seen.
1 remember explaining to some people in my riding the effect this program would have and how it would not really help them. They were quite amazed. They said, "Perhaps this is really an election gimmick". That is what many people really think when they study the proposal of the official opposition. There are many people in my riding who cannot afford down payments, and 1 do not think the program would help them.
In the process of trimming our budget and redistributing dollars it is clear that some very good programs will suffer. We do not like to cut back on those programs, but we should redirect our tax dollars to areas of the greatest need. We have no choice.
I have spoken about the family allowance. We are cutting it from approximately $25 per month to $20. I think that is a positive step, when we take into account the tax credit of $200 per child for those families which earn $18,000 or less. For those families which earn more than $18,000 the tax credit will not be as high. I think this is an excellent way to approach the matter. The approach should be to help those who really need help. If we are to use the family allowance program effectively in this time of restraint, we must reduce monthly payments to some families. The monthly cheques will still go out to every family with children, but in a reduced amount- $20 per month per child instead of the current $25.
The money saved by that reduction will finance a refundable tax credit of $200 a year for each child under the age of 18, in cases where the family income is below $18,000. Above
October 16, 1978

$18,000, the amount of the credit will diminish and gradually disappear in the high-income brackets. That credit will be paid to the mother of the family, effective January 1979, and it will be paid even in cases where the family pays no income tax. While the greatest benefit will go to the 1.5 million children who live in poor Canadian families, the tax credit will also provide greater assistance to middle-income families in caring for their children.
Our unemployment insurance measures tell the same story. We are reducing the benefits of the program and tightening up its administration. But with the money saved, we are offering enriched incentives to the private sector to create permanent jobs. Young people have trouble finding jobs because of their lack of experience; the federal government will now pay the cost of a $1.50 an hour wage subsidy to those employers willing to take a chance on hiring a young worker. We will also give a subsidy to business to train the workers it needs. We are aiming to have these measures in place before winter.
And we have other proposals, likewise aimed at combatting inflation, fostering economic growth, or improving the lot of needy Canadians. The old age pension supplement will rise by $20 per month per household from January, 1979. An additional $300 million has been alloted for industrial development. The federal excise tax on gasoline has been cut by three cents per gallon. Postal service will be improved by the Post Office's conversion into a Crown corporation. Taken together, these initiatives and announcements add up to a comprehensive agenda of economic and social action.
This brings me to the third R, renewal. Our economic program aims at something beyond more jobs, better social services and leaner government. Ultimately, we are seeking to establish a renewal, a strengthening of confidence in this country and its future.
Canada still has boundless potential in its natural resources, its skilled manpower and it growing industrial might. We also have a solid record of past economic performance. Whether the measurement is the rate of growth in employment, the number of new homes, or the increase in real disposable income, Canada comes out first among the western industrialized nations in over-all performance. Nothing but a lack of confidence can hold us back from economic recovery.
Spending restraint and the reallocation of existing resources are now fact. What remains is for Canadians everywhere, in their response to the government's new economic program, to display the renewed confidence which will allow them to achieve the future they deserve.
The other issue I would like to spend a few moments talking about concerns the area of constitutional change. During the summer, along with colleagues from all sides of the House I served on the special joint committee of the House and the Senate with respect to the constitutional proposals. 1 think it was a very interesting exercise and I think it is noteworthy that the committee was able to come down with what I think is a unanimous report in some aspects, shedding light on how it feels about constitutional change and constitutional proposals.
The Address-Mr. Lee
I listened to the hon. member from Central Nova saying there was no urgent need to change our constitution. Well, I think there is. I think we have to demonstrate to the people of this country that parliament is not going to stand by and maintain the status quo. 1 can see the hon. member across from me shaking his head. They keep on saying we are going about this the wrong way, that we should not just be making changes with respect to institutions but that we should also be talking about the division of powers.
The premier of my own province, British Columbia, delivered a speech last spring, in May of 1977, to the Canadian Men's Club in Vancouver. He said-and I believe my memory serves me correctly-that the two most important and urgent problems facing this country were the national economy and the question of constitutional reform. In that speech, Premier Bennett went on at great length to express the view that we did not really need wholesale changes affecting the division of powers; and what we need is a change in our institutions to ensure that the various regions within our country, and the west in particular, do have the power and the ability to influence what is going on within Canada by changing federal institutions. He agreed that maybe we should change the upper chamber as it is not really doing the job of properly reflecting regional interests and regional needs.
As for the particular proposal of the government with respect to the House of the Federation, which was tabled for discussion purposes only, I certainly do not think that proposal is that sound. But it started off a very good discussion on how we could change federal institutions to meet the needs of the west and of the Atlantic provices so that we would get away from this feeling of alienation, this feeling that there is too much power within central Canada.
That was certainly brought out by the people who spoke and testified before the committee and in particular by the representatives of the Canada West Foundation. I think they are a very articulate and good group headed up by Mr. Stanley Roberts, the former vice president of Simon Fraser University of my home province. What he was saying was: Yes, we realize that this government has in fact taken into account the various regional interests. Whether through appointments to various quasi-judicial bodies like the CRTC, the Canadian Transport Commission or administrative bodies, or with respect to appointments to the cabinet, we do take into account regional interest. But he was saying that it is the appearances that have to be changed and that institutions like the upper chamber really have to reflect truly regional interests within this country. He said after having attended a number of symposiums in major centres across western Canada-in Winnipeg, Banff, Calgary and Victoria-that most people did not like the concept of the House of the Federation in that members of various provincial governments, whether they be premiers or ministers or delegates of those governments, could come down to Ottawa and in effect block or veto legislation passed by the House of Commons, a body which is elected on the basis of a national mandate at each federal election.

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This is exactly what the concept of the House of the Federation really amounts to. It is unacceptable that an upper chamber, particularly one made up of people who represent the various provinces could come here and block federal legislation passed by the House of Commons consisting of people who represent the will of this country. I think it was Professor Mcquinney, one of the witnesses who testified before the committee, who called it the "Bundestag caper". He said that provinces like the province of British Columbia were not really addressing themselves to the issue. He also pointed out that one of the constitutional courts in Germany held that the Bundestag really was not a bicameral house in a true federal state, that it was only an extension of the executive form of government.
I think the area in which we should work much more closely is that of having proper and full discussion at the first ministers level. Provincial governments are elected to represent provinces. The Prime Minister very adequately pointed out last Thursday that as the Prime Minister he is elected to represent the nation as a whole. That is the area upon which we should concentrate.
Some of the other witnesses who testified before the committee indicated that in times of war, at the end of war or in times of great need or emergency all the component parts of the constitution can be changed, whether it is the actual make-up of government or the division of powers. Many of the witnesses said that the government is taking the right approach by adopting a rather pragmatic approach to the entire issue of constitutional reform. It is dealing with the issues of institutional reform, the upper chamber, the constitution of Canada, the charter of human rights, and then seeking a consensus respecting the division of powers.
I see that my allotted time has expired.


A. Daniel McKenzie: Mr. Speaker, I welcome the opportunity of entering into this debate. I am very disappointed that the debate has reached such a low level. Of course, this trend was commenced by the Prime Minister (Mr. Trudeau) last week when he used selective statistics and handed out false information.
The hon. member for Vancouver East (Mr. Lee) was respected on this side of the House, but this evening he has completely destroyed any respect members on this side had for him, especially after such a ridiculous speech. He touched upon Sky Shops as if it was a mischievous matter raised by the Conservative party. The Quebec government laid charges against four men. There have been court cases, and Senator Giguere has been acquitted, which acquittal is being appealed by the government of Quebec. If the hon. member thinks this man is making any contribution in the Senate, I advise him to look at Senate Hansard. In the ten years he has been a Senator, he has done absolutely nothing other than being involved in the Sky Shops matter. I will not defend anyone like that, and I do not know why the hon. member would.
There are three ongoing inquiries into the RCMP. They were not instigated by the Conservative party; they were instigated by other governments. Obviously there is something wrong when the hon. member indicates that the Royal Canadian Mounted Police are against us. Those statements are completely false.


An hon. Member:: Order, order.


A. Daniel McKenzie: I have many friends in the RCMP. I should like to tell the hon. member about the RCMP. Representatives of that force came to my home in 1968. They wondered what was happening in the country because the Liberal leader was to become the Prime Minister of Canada. They could see Trudeaumania occurring and they said, "What on earth is happening in this country? Is a man with that background going to become Prime Minister?" The RCMP has not forgotten that.
The hon. member for Vancouver East expressed concern about bringing expenditures into account. On February 7, 1978, we presented a motion in the House to review the entire government structure, to bring in sunset laws, and to make every government department justify their existence in order to conduct proper examinations and bring expenditures under control. I suggest the hon. member read the speeches in that debate. Every one of your members over there, including the NDP, ridiculed that debate. You are no more interested in bringing expenditures under control than flying to the moon. You are such an irresponsible group that you changed the rules in 1968.


Mr. Deputy Speaker:: Order, please. I regret to interrupt the hon. member for Winnipeg South Centre (Mr. McKenzie) but I would suggest that he direct his comments to the Chair. He should be speaking in the third person rather than addressing the hon. member and his party directly. He seems to be directing his accusation toward the Chair.


A. Daniel McKenzie: Mr. Speaker, I apologize for that. I will direct my comments through Your Honour. Of course we have no control over expenditures. This is due to legislation brought in by the Liberal government in 1968. At that time they stopped proper examination of government expenditures and reduced the role of parliament to the point where government estimates were not examined properly. This legislation was rammed through the House of Commons under closure by the Liberal government. My party did not support that particular motion.
Today we are in such a financial mess that the Auditor General has indicated that he cannot certify the accounts. This has resulted in the necessity for a Comptroller General, which will cost the Canadian taxpayers $6 million. That department will be set up in order to find out where the money is going, yet the hon. member for Vancouver East told us that the government is interested in controlling expenditures, as well as speaking other silly nonsense.
He mentioned the mortgage interest deductibility program. The manner in which that program has been criticized by the
[Mr. Lee.)
October 16, 1978

Prime Minister and other government members is very interesting. It is evident that we have come up with something good. A similar program is working in the United States and Great Britain. Why on earth cannot it work in Canada?
The Minister of Finance (Mr. Chretien) was out in Winnipeg making a series of irresponsible statements concerning the mortgage deductibility program. I should like to make a few comments regarding the financing of such a program. The minister indicated that the federal budget deficit was expected to reach $11 billion this year and perhaps go as high as $15 billion. He wondered how we could afford a new program at this time. We stated that a Progressive Conservative government would offset the cost of these major tax incentives by instituting a program of restraint to reduce current government spending.
On February 2, 1978, we raised this matter but it was opposed by the New Democratic Party. The privatization of Petro-Can will result in the sale of assets with a current book value of $900 million. Also that will result in an end to advances to Petro-Can which amount to $200 million a year.
Also we mentioned that there was no need for the Department of Urban Affairs. We are not backing down on that suggestion. That would result in a saving of another $20 million.
The Liberal government stated that the program made no provision for Canadians who are not home owners. Because mortgage interest and property taxes are deductible business expenses for landlords, renters already receive these benefits. The majority of Canadians aspire to owning their own home. We want to assist Canadians in buying their own home. Young married couples want to own their own home. They do not want to live in apartment complexes all their lives. The rich are able to buy homes. It is the low income earners who are unable to buy homes. Renting for many, especially the young, is viewed as a temporary condition until they can afford to purchase. This program will make the dreams of these renters come true. Renters should realize some spin-off benefit from the program.
As middle income Canadians encouraged by the tax deductions move into their own homes, the amount of rental accommodation will be increased, thus removing some of the pressure from renters. We have come up with a program that will be worked out with the provinces, though certainly some technical aspects will have to be worked out. It is a plan designed to help people purchase homes. The hon. member for Vancouver East has ridiculed this plan in his riding, yet he offered no alternative.
Also the Liberal government indicated that the program benefits only the rich. The tax proposals are not intended as a social program. Their primary purpose is to provide a major economic stimulus in order to get the Canadian economy going again at a satisfactory rate. From time to time we will outline more detail, but I have touched briefly upon the matter now.
We can obtain money in order to finance this program by a reduction of consulting and other contracts which have risen
The Address-Mr. McKenzie
by 650 per cent, or $1.4 billion a year. Canada has the benefit of having approximately half a million public servants who have some of the finest brains in the country. They are educated and have degrees, yet $1.4 billion a year is spent on outside consultants. This work could be done within the public service. Perhaps some highly specialized consulting work will have to be done by consultants outside the public service, but a lot of money can be saved in that area.
In the area of information and advertising, expenditures have increased by 100 per cent, or $180 million a year. I would suggest that propaganda would be a better term to describe this area. We do not need all this advertising. This is another area where we could find some money for the program.
During the 1975-77 period the administrative and other operating costs of the government increased by 45 per cent. If during that period the Trudeau government had lived by its own AIB guidelines, its own spending would have been $3 billion less in 1977. What on earth is this government doing with operating costs going up 45 per cent? Hon. members opposite stand here and tell us what brilliant administrators they are. If they are brilliant administrators the costs would not be increasing to the extent of 45 per cent.
A PC government will cut the waste and inefficiency from government operating costs without reducing efficient service to the public. If hon. members want to find out about waste and mismanagement I suggest they just read the Auditor General's reports. On and on this goes.
I am not going to read out our whole program tonight, but there is another point I want to make. The PC program of tax deductibility for mortgage interest and property taxes would be of particular benefit to the Canadian housing industry where unemployment is currently running at double the national average. Housing starts this year are running at 230,000 units, yet the Canadian house building industry has a proven capacity of producing at least 275,000 starts a year without significant pressure on housing prices. By stimulating demand to at least that proven capacity the PC program would generate 75,000 new jobs. What has that to do with a program for the rich?
Let me say to renters and everybody else in this country that unemployment here is costing Canadian taxpayers a great deal. Whether one lives in a home, rents or lives in a hotel, unemployment is costing $8 billion a year. I am quite sure that many renters would like to pay a lot less to welfare and UIC programs.
Members on the Liberal side have said that house prices would inevitably rise with our mortgage tax deductibility program. A colleague has just informed me that this mortgage deductibility program has been in effect in the United States for the last 40 years and the price for a house there is a lot less. Let me give an example. A Winnipeg home must have a basement and be properly built for a particular climate. The same home in North Dakota or Minnesota costs $10,000 to $20,000 less, and they have had this program in being for

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years. But in this regard we have had absolute nonsense from the government side.
At the present time there are 70,000 unsold homes in Canada. Is that not some record? Have we heard one speech from the other side since last week saying what the Liberals are going to do about those 70,000 unsold homes? Some builders in my riding have held these unsold homes for a year or a year and a half. They are going bankrupt. Isn't that wonderful? What is this government going to do about it? I suggest it will do absolutely nothing. We have come up with a program; let us get it off the ground, get it going and do something.
As usual, the Liberal party is divided all over the place. I have an article here from Montreal which indicates that the Liberal candidate in Westmount likes this Tory policy. I understand there are two or three others in Toronto and one in St. Boniface who support the policy. Someone referred to the former mayor of Toronto in relation to housing. I recall that gentleman coming down here and appearing before a parliamentary committee in respect of housing and urban affairs. That is a man very concerned with housing and he appeared before this parliamentary committee with a lot of constructive ideas regarding housing. Thank God he is going to be here in this House to make his contribution in respect of housing in Canada.
At the commencement of my remarks I referred to the climate of the debate, and what a sorry thing it was that the Prime Minister is leading by giving us a lot of false statistics. It is incredible that the man in the number one position in Canada, the leader of the government and the country, would make a speech at this particular time using a lot of improper statistics.
This whole matter was covered very well by Don McGilliv-ray of Southam News Service. I have mentioned a lot of the false information being spread about our mortgage interest deductibility program. Let me read what Mr. McGillivray has said in reference to the Prime Minister's speech:
Trudeau is incredibly careless in the conclusions he draws from his numbers.
It is simply untrue to say, as he did, that "Canada, in terms of the employment growth rate, is the best in the world."
According to the statistical Yearbook of the United Nations, 15 countries had faster rates of employment growth between 1970 and 1975. Those were years when jobs were appearing in Canada faster than they have since, but Mauritius, Jordan, Malawi, Kenya, Turkey, Syria, South Korea, Malaysia, Yugoslavia, Romania, Spain, Swaziland, Tunisia, Fiji and Pakistan did better.
Since then, Canada's rate of job creation has failed behind other countries, including the U.S. Statistics published by the Paris-based Organization for Economic Cooperation and Development show that between 1975 and 1977 the U.S. created 6.4 per cent more jobs while Canada was creating only 4.2 per cent more.
How then, can the prime minister cite numbers to back his claim that we "still lead the world"? First, by restricting his "world" to 15 industrial countries and second, by mixing the slow recent rates of job creation with faster rates recorded before 1975.
Has Canada really done "immensely better" against inflation than most of the other industrialized countries?
For proof, Trudeau cited Figures for the period 1968-76. And 1976 was, of course, the year when food prices slumped and gave Canada a relatively good
year against inflation. Even so, Canada's performance was so-so, not immensely better.
More recent figures do not bear out the impression that we are doing better at all. The Economist, the British-based journal of business and current affairs, does a regular check on 10 "major economies" including Canada. This shows that eight of the 10-Australia, France, Germany, The Netherlands, Japan, Sweden, the U.S. and Britain-did better than Canada against inflation in the past year. Only Italy did worse.
The Prime Minister stood up in this House and told us we are licking inflation. Mr. McGillivray concluded by stating:
But perhaps we should not expect Trudeau to be candid.
But it does seem that a prime minister who sets out to correct the "absolute falsehoods" uttered about the economy by the opposition leader should avoid the tricks described in a book like How to Lie with Statistics.
How can we have any credibility at all in any the government's proposals to cure unemployment or anything else?
Then we heard the ramblings of the hon. member for Crowfoot, the Minister of Industry, Trade and Commerce (Mr. Horner). Good heavens, I remember his speeches and statements about the 92-cent dollar. He was raving in here about how we could not live with a 92-cent dollar. Now he says that the 84-cent dollar is the greatest thing that ever happened to Canada. I don't know, but I think I would call him the Christine Jorgensen of Canadian politics. I have never seen such a transformation in my life. I do not know how he lives with himself.
Let me read a very interesting statement made this week by the British secretary of state for trade who talked about the British experience with the devalued dollar. He said:
The British experience with a falling currency is that it helps trade but with "serious costs" in rising domestic inflation-
While Dell refused to comment directly on Canadian dollar problems here, he said the declining value of the British pound in the mid-1970s "did give us certain advantages and competitiveness" in trade. "But there are costs in this and serious costs," he said to reporters after talking with federal ministers. Among these are costs of inflation caused by depreciation. It is better if one can be less dependent on the price factor in selling one's goods and services and more dependent on quality.
We want our dollar to be worth a dollar, or at least within a couple of cents either way.
I read with great interest the statement made by the premiers last August at their conference in Regina. They seemed to identify all the problems and wanted to take some particular action, but so far no action has been taken on the recommendations. The bulletin from the Manitoba Information Services Branch says:
The provincial premiers reviewed the state of the Canadian economy and the progress which they had made towards achieving the goals established at last year's conference in St. Andrews, New Brunswick.
They noted that as provincial governments they had made some fair degree of progress in the areas which they had established as important in coming to grips with the dual problem of unemployment and inflation.
The provinces had restrained their operating expenditures, with the growth of provincial expenditures falling below that of the federal government.
Provincial public sector wage and salary settlements have been comparable to or less than those in the private sector.

October 16, 1978

The premiers also stated that they urged the development of a joint national economic strategy.
The February conference was a step in this process. The premiers reaffirmed their commitment to the principles agreed to but expressed their concerns about the lack of progress on specific policy directions and projects also agreed to.
It would have been wonderful if this government had dealt with the issues raised by the premiers at this conference in August, Mr. Speaker, instead of spending the last few months debating the constitution. You could debate the constitution for the next 20 years but it is not going to create one job or stop the best of money from leaving Canada. It will not correct the debt or do anything. These are things that should be debated these next few months by the federal government and the premiers. The bulletin goes on:
The premiers agreed that the review promised by the federal government in February should proceed and be concluded with dispatch.
We have seen no dispatch at all, Mr. Speaker.
The premiers also came up with an excellent suggestion in regard to UIC:
The premiers agreed that the UIC Act be changed, if necessary, to provide for new uses of UIC funds which would be more conducive to job creation. In this respect they urged the federal government to co-operate with the provinces, in devising more creative use of the UIC funds.
This is an excellent suggestion and I am sure that we all support it, but nothing is being done about it. We, the opposition party, support it and all the premiers support it, but where is the leadership from the government? It goes on to say:
They agreed that, for instance, where a temporary economic crisis disrupts employment patterns, a strategic disbursement of unemployment insurance moneys could maintain a work force intact and hasten its re-employment.
The premiers also agreed that there should be an immediate program of restraint and proper management of our financial affairs. This was even agreed to by the NDP premier of Saskatchewan.
I would like to give an example of what happens when expenditures are brought under control and waste is eliminated along with mismanagement. We have experienced this in Manitoba over the past year. Before I begin to explain how we have made such a successful gain in the economic scene in Manitoba, I just want to point out the figures for September. They showed that there was a 35 per cent increase in unemployment. This is some kind of phenomenon for Manitoba. In September, 1977, unemployment was up by 29 per cent, but it is just for this particular month that this happens, and I cannot explain it fully.
The poor economic performance of 1978 has its basis in the economic environment established by the previous NDP government. A poor performance for this year was forecast in November, 1977 by the Conference Board, with the dismal economic performance of the first three quarters laying the groundwork. The groundwork of our problems was laid by the previous NDP government and has nothing to do with what the present Conservative government is doing in Manitoba.
This research completely counters the false statements the federal members of the NDP have been making about the
The Address-Mr. McKenzie
economic conditions in Manitoba. The Conference Board has said:
As the Manitoba economy has borne more than its share of the general national economic slowdown in 1977, the 1978 projections show a recovery that is significantly weaker than that for the nation.
There are two variables which affect the level of unemployment in an economy. One variable, labour force growth, is not controllable. The other variable, employment growth, is influenced by economic performance.
I have just received a note on how things are going in the riding of St. Boniface tonight. The NDP spent most of their campaign on attacking the present Conservative government of Manitoba, but I would like to point out right now that the Conservative candidate is 2,100 votes ahead.
The memorandum which I have been referring to goes on to say:
The Manitoba labour force has grown by 18,000 in the past year-a growth rate above the national average, and far greater than had been experienced in any of the NDP years. This factor is not controllable.
Employment growth is controllable. Employment in the past year has grown by 10,000 jobs. Employment growth in the last four years of the NDP government averaged only 3,000 per year. This year's job performance is actually better than was forecast by the Conference Board.
So, by properly controlling your expenditures and cutting out a lot of wasteful programs, the private sector can be attracted to invest once again in the province. In the last year of the NDP government, 6,000 manufacturing jobs were lost. There was a loss of 5,000 jobs in transportation and communications. The 6,000 lost manufacturing jobs have been more than regained, for manufacturing employment is up by 8,000 over this time last year.
That is quite an enviable record for just one year considering what the Conservative government inherited after eight years of complete mismanagement of Manitoba's affairs. Of course, we have another parallel in this House with the present government. When the NDP was first elected, the Manitoba unemployment rate was 2.6 per cent. Within a year it had jumped to 6.4 per cent. The first year of NDP government in Manitoba was a disaster in terms of unemployment as the 8,000 jobless in June, 1969 almost tripled to 22,000 in June, 1970. They did not waste any time in destroying the economic situation in Manitoba.
The NDP also talk about the fact there is no building or construction going on in Manitoba, that everything has ground to a halt. I would like to point out that $300 million worth of construction permits have been issued so far this year. The city building permits department has reported that it issued $40.2 million worth of permits last month, a 69 per cent increase over $23.8 million total for September, 1977. This is an enviable record in just one year, and it shows what can be done. If this government, adopted these policies you can imagine what an enviable position we would be in today, Mr. Speaker.
I would like to explain why we have such a high unemployment rate in this country and such a high level of investment leaving it. According to figures published in the first quarter.
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October 16, 1978
The Address-Mr. Hopkins
$18 million of investment money left Canada daily. Canada today is probably the best friend that the United States ever had to help them with their economic problems. Of course, with eight years of New Democratic Party government in Manitoba, they were the best friends Alberta every had too.
I have some statistics here, Mr. Speaker, provided to me by a financial consultant who assisted some 24 businesses to move out of Manitoba. He says that countries, or for that matter provinces, which have nationalistic, leftist or extremely strong bureaucratic tendencies make striving and successful entrepreneurs feel uncomfortable. That also described this government. It is why we have such a mass exodus of business and investment money from Canada. This financial expert stated that the movement of this $40 million out of Manitoba would cost the province 4,000 jobs. When I spoke to him last week, he said the trend is definitely changing. The provinces are not going to correct this situation by themselves but will need co-operation from the federal government.
The Prime Minister and members of the government who have spoken in this debate have upbraided us for having the audacity to criticize the government. I challenge anyone to show me a document that supports this government. Even the Senate is issuing studies describing its failures, and that goes for a lot of Liberal senators too. Everybody in Canada is writing some sort of document to support the things we have been saying for the last five years. Newspaper articles and statistical information offered by experts around the country confirm what we have been saying-that this government s handling of the economic problems of Canada is a disgrace.


Some hon. Members:: Hear, hear!


Leonard Donald Hopkins: Mr. Speaker, first of all I would like to take this opportunity to congratulate the mover and the seconder of the Address in Reply to the Speech from the Throne.
Tonight I want to say something about rural development in Canada. We live in an urbanized society today. Cities are growing larger and larger and unless we develop the rural communities into places where people can live without the need and high cost of law and order, as is required in highly urbanized or centralized areas, we are going to pay the price in
years to come in the same way as the Chicagos, the Detroits, the New Yorks and the Bostons are paying the price today.
Our nation was built on three main staples-the fur trade, the timber trade, and wheat. Since then it has bloomed in many different directions and to a large degree we are now a technological nation, particularly in the field of electronics.
The region I come from, the upper Ottawa Valley, was one of the original fur-producing areas. It was also among the first of the timber-producing regions. Parts of the valley can grow wheat and other parts are good only for forest lands. Agriculture, forestry and small community development are therefore of great interest to me. The tall pines, the spruce, the hemlocks and the hardwood stands are part of the proud heritage of eastern Ontario and western Quebec.
After the turn of the century when the "boom timber days" were declining, a great vacuum grew in the economy. The forest industry continued at a reduced level of production and the federal government moved in to take up some of the slack. In 1907, Camp Petawawa was established under the Laurier government. The land was purchased from local farmers, many of their ancestors had come to cut the pine off the sand and rock of the uppermost valley area, and had stayed to farm as best they could.
There are some interesting stories about this in the upper valley. During the days when the military were having firing practice they would move families out of the farm houses to what is now known as the historical Matawa Trail along the Ottawa River. Then they would fix up the houses and move the families back in for the night.
In 1909, settlers were totally moved off this land. There is an interesting editorial in one of the local newspapers of that time which says what an economic disaster it would be to have this farm community moved off what was Camp Petawawa, because it would be a great detriment to the business of merchants in the nearby town of Pembroke. Today, about 10,000 people have replaced those farmers whose families were moved on to better nearby lands with their families.
Mr. Speaker, may I call it ten o'clock.


The Acting Speaker (Mr. Turner):: It being ten o'clock, this House stands adjourned until tomorrow at 11 a.m., pursuant to Standing Order 2(2).
At 10 o'clock p.m. the House adjourned, without question put, pursuant to Standing Order.

Tuesday, October 17, 1978