1978-05-08

ROUTINE PROCEEDINGS


Mr. Steven E. Paproski (Edmonton Centre):: Mr. Speaker, I hope the government will take cognizance of my motion and not say "No". I rise under the provisions of Standing Order 43. My motion concerns the fact that today is the thirtieth anniversary of the foundation of the State of Israel following the holocaust in which six million Jews lost their lives during World War II.
In view of the fact that in just three decades the Israelis have pioneered what is today a great nation, I move, seconded by the hon. member for High Park-Humber Valley (Mr. Jelinek):
That this House reaffirms the right of the State of Israel to exist in peace with its neighbours, and further reaffirms the right of Israel to secure borders consistent with the need of all the peoples of the Middle East for a just and lasting peace.


Mr. Speaker:: Presentation of such a motion for debate would require the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Hon. Allan J. MacEachen (Deputy Prime Minister and President of Privy Council):: Mr. Speaker, this is an important motion and we would like to consider it before registering an opinion. Perhaps it could be held over until tomorrow.


FISHERIES
Mr. Benno Friesen (Surrey-White Rock):: Mr. Speaker, I rise under the provisions of Standing Order 43 to move a motion of urgent and pressing necessity. In view of the fact that Canadian and U.S. fisheries negotiators have met regularly since last October and consulted closely with their respective provincial, state and industry interests regarding reciprocal
fishing agreements in coastal waters, and in view of the fact that arrangements-at least for the 1978 fishing year-have been successfully negotiated and await only Congressional approval, I move, seconded by the hon. member for Esquimalt-Saanich (Mr. Munro):
That the Canadian government move in the quickest possible fashion to promote and preserve Canadian fishing interests by appealing the U.S. District Court injunction forbidding Canadian boats from fishing in western U.S. coastal waters.


Mr. Speaker:: Presentation of such a motion for debate, pursuant to Standing Order 43, would require the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


PUBLIC SERVICE
Mr. Andy Hogan (Cape Breton-East Richmond):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. All members of this House have learned to appreciate the humour of the member for St. John's West (Mr. Crosbie). However, it is no funny matter for that member to say publicly that if his leader becomes prime minister of this country, 60,000 public servants will be laid off. I, therefore move, seconded by the member fcr Greenwood (Mr. Brewin):
That the hon. member cease and desist from making such deplorable and irresponsible statements.


Mr. Speaker:: Presentation of such a motion for debate would require the unanimous consent of the House, pursuant to Standing Order 43. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


INQUIRY INTO MANAGEMENT OF SPORT CANADA-MOTION UNDER S.O. 43
Mr. Otto Jelinek (High Park-Humber Valley):: Mr. Speaker, I rise on a matter of urgent and pressing necessity related to the incompetence of the ministry of amateur sport under

May 8, 1978
whose responsibility Sport Canada and many amateur sport and recreational associations have cost taxpayers nearly $9 million over a period of five years due to errors, mismanagement and sloppy administration.
In view of the fact that official recommendations were made as much as 2Vi years before a new and separate ministry was established with the objective of providing competent management to the many Canadians dedicated to the betterment of sport and fitness in Canada, and because it is now apparent that no such positive management has been provided, I move, seconded by the hon. member for Edmonton Centre (Mr. Paproski):
That this House instruct the Minister of State (Fitness and Amateur Sport) to initiate forthwith either a public or departmental inquiry under the Inquiries Act into the mismanagement and incompetent activities of the ministry and its officials at Sport Canada.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


TRANSPORT
Mr. Robert Muir (Cape Breton-The Sydneys):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of pressing and urgent necessity. In view of the assurance given me by the general manager of Canadian National Marine, Mr. Rupert Tingley, on Thursday last that "there was no foundation whatsoever to rumours that CN Marine was contemplating any removal of their operations at the port of North Sydney", and in view of the information provided last Friday-the next day-by the Minister of Transport (Mr. Lang) in this House that the second rail car ferry, the Sir Robert Bond now taken out of service between North Sydney and Newfoundland was not going to be replaced, I move, seconded by the hon. member for St. John's East (Mr. McGrath):
That the minister or his deputy minister attend an urgent meeting on Wednesday, May 10, called by Mayor T. R. Young of North Sydney to discuss the present and future status at both the Port aux Basques and North Sydney ferry terminals with reference to the disastrous cutbacks by CN Marine and the effect that they are having on the economic and social lives of both communities, and if either the minister or his deputy minister cannot attend, that a top official from Canadian National attend and provide answers to the many questions that are causing such great concern to all Canadian National workers involved and the public in general.


Mr. Speaker:: Presentation of such a motion for discussion, pursuant to Standing Order 43, would require the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: No.


Some hon. Members:: Agreed.


VETERANS AFFAIRS
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I rise under the provisions of Standing Order 43 in the hope that the legislation referred to in my motion will be presented this week. I move, seconded by the hon. member for Timis-kaming (Mr. Peters):
That it be a House order that any bill introduced by the Minister of Veterans Affairs at any time this month to raise the basic rate of the war disability pension, or to modify the 48 per cent rule respecting pensions for the widows of veterans, or both, be dealt with at second reading, considered in a committee of the whole House and given third reading in one sitting day.


Mr. Speaker:: Presentation of such a motion for discussion would require the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Mrs. Jean E. Pigott (Ottawa-Carleton):: My question is for the Minister of State for Urban Affairs whose tenure at his post has been marked by an obsession with the numbers game when it comes to housing starts. Now that the housing starts for the month of April are revealed to have fallen over 100,000 at a time in the spring when they should be rising, will the minister tell the House whether he can confirm Central Mortgage and Housing projections that the number of houses built this year will decline, and will he tell the House what his government plans to do to provide a measure of security to the construction industry where unemployment now stands at 30 per cent?


Hon. Andr6 Ouellet (Minister of State for Urban Affairs):: Mr. Speaker, it is obvious that the number of housing starts has decreased during the past month, but we should not be unduly concerned. The projections extending over several months show indeed that we will attain our objectives and build about one million houses during a four-year period. We are well within that projection and there is nothing to be worried about.
May 8, 1978


Jean Elizabeth Pigott: Mr. Speaker, I do not think that is an adequate answer, having regard to the current rate of decline in housing starts of some 17 per cent over the last year and the fact that
74,000	workers in the construction industry will lose their jobs this year if the decline continues.


Some hon. Members:: Shame.


Jean Elizabeth Pigott: My supplementary question, Mr. Speaker, relates to the shocking disregard for federal-provincial relations which the minister showed when he rushed out his election package last week to the provincial housing ministers. Bearing in mind the telegrams the minister has received from provincial ministers, one of which sent by the Ontario minister of housing itemized four major areas of concern and another of which called into question the minister's and I quote-


Some hon. Members:: Order.


Mr. Speaker:: Order, please. If the hon. member has a supplementary question, will she please put it.


Jean Elizabeth Pigott: I ask the minister why he cancelled the consultative meeting in April with his provincial counterparts and sent the peremptory telegrams instead? Will he tell the House why he has not answered the ministers' request to meet with them this month?


Steve Eugene Paproski: He does not believe in consultation. [Translation]


Mr. Ouellet:: Mr. Speaker, I do not know who is drafting the hon. member's questions but they are full of incredible inaccuracies. It would take me too much time to answer each point raised by the hon. member. Next week I will appear before the committee responsible for housing and I will take this opportunity to answer specifically the mistaken statements made by the hon. member.


Jean Elizabeth Pigott: Mr. Speaker, I wish the minister would specify exactly what he means by "incorrect." All my figures are taken from his department.


An hon. Member:: That is what is wrong.


Jean Elizabeth Pigott: There is a specific program I would ask the minister about. His proposals will increase the cost of a $35,000 mortgage by nearly $10,000, according to industry spokesmen. When the Minister of Finance's increase of one full percentage point in interest rates is added on top of that, it is easy to see why people are defaulting in record numbers on AHOP mortgages. Bearing in mind that under this government real incomes are actually falling, will the minister tell the House why he still refuses to adopt the policy of this party and allow for at least partial deductibility of mortgage interest against income tax?
Oral Questions


André Ouellet: Mr. Speaker, the proposal which I advanced last week following consultations with the provinces has been welcomed, in spite of what the hon. member believes, by the most important group in the house building trade in Canada, the HUDAC group. Indeed, their president stated that it was quite a suitable step taken in the right direction.


THE BUDGET
Mr. Stan Darling (Parry Sound-Muskoka):: Mr. Speaker, I have a supplementary question for the Minister of Finance. Is the minister prepared to admit that the budget which was brought down a short while ago has done almost nothing to aid the construction industry and housing? Will he tell the House why he has not brought forth measures to assist the industry, which is one of the worst hit in Canada with, as my colleague said, 30 per cent unemployment at the present time-a figure which may even increase?


Hon. Jean Chretien (Minister of Finance):: Mr. Speaker, I agree with what my colleague said. We, of course, recognize that in the month of April starts were less than predicted. However, I must tell the hon. member that for the first three months of the year starts were greater in number than had been predicted.


HOUSING
Stan Darling: Mr. Speaker, I direct my supplementary to the Minister of State for Urban Affairs. In keeping with the tradition and duty of this institution of being the guardian of the public purse, and in exercising this duty through scrutiny of estimates in committee, and in view of the mounting concern about housing in this country, will the minister consider allowing the president of Central Mortgage and Housing Corporation to appear before the standing committee of the House?


Mr. Baker (Grenville-Carleton):: And give evidence.


Stan Darling: And give evidence?

May 8, 1978
Oral Questions
chairman of that committee according to our long-standing procedure which stipulates that a minister can be asked questions and that if he agrees, he can have his department officials answer on his behalf. Now the argument which was raised last week by the hon. member for St. John's East had to do with quite an inappropriate point of procedure. As a matter of fact, I was never asked directly to allow my official to answer on my behalf. If that question had been put to him, he would most certainly have been allowed to answer but the hon. member for St. John's East was definitely more interested in raising a point of order than in actually obtaining answers.


Stan Darling: Mr. Speaker, I have another question for the Minister of State for Urban Affairs. I was present at that meeting. I ask, again, because we directed questions to the president of Central Mortgage and Housing Corporation, and I will concede that the chairman ruled it out-


Mr. Speaker:: Order, please. If the hon. member has a question, he should put it rather than make an argument.


Stan Darling: Will the Minister of State for Urban Affairs let the chief administrative officer of CMHC answer questions when we are in committee next week?
[ Translation]


André Ouellet: Mr. Speaker, if the hon. member can arrive on time at the meeting and stay until the end, he will get answers to all the questions he may be prepared to ask.


FISHERIES
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I have a question for the Minister of Fisheries. Considering that a United States District Court judge has issued an injunction forbidding Canadian fishermen to fish off the west coast of the United States, will the minister inform the House what action the Government of Canada has taken? More specifically, since this is the second year in a row that there has been violation of this treaty on the American side, can the minister assure the House that so long as Canadian fishermen are prohibited from enjoying the right they have under the treaty to fish off the United States coast, similar action will be taken restricting American fishermen from fishing off the coast of Canada?


Hon. Romeo LeBlanc (Minister of Fisheries and the Environment):: Mr. Speaker, the judge who granted the injunction gave the United States' administration, according to the memo I have, seven days to appeal the order; therefore, the order will not come into effect before May 12. As the hon. member may not know, I should inform him that there have been discussions between our officials and the American officials about this temporary agreement. The two special negotiators, Ambassa-
[Mr. Ouellet.l
dors Cadieux and Cutler, are to meet this week in Ottawa. If the agreement is not operative, or if it is not valid, obviously neither side, Canadian or American, will be bound by it. However, I would prefer to see the two fisheries negotiators try to find common ground before answering the hon. member's second question.
I might add that the preface to the hon. member's question was somewhat misleading. In response to the American action last year there was, in fact, a Canadian reaction which was to close our own shrimp fishery to United States boats.


John Edward Broadbent: I did not comment on whether there was reciprocal action last year; my question concerned whether serious action would be taken this year. I ask the minister this question and perhaps his reply will be more specific: If the decision is finally reached in the United States on this matter within a week or so, can the minister assure us that should Canadian fishermen be denied the right under the treaty to fish off the west coast of the United States, the Canadian government will take similar action vis-a-vis American fishermen off the coast of Canada?


Roméo LeBlanc: It is evident that if the American side does not live up to the agreement, the Canadian side would not be bound to it either.


John Edward Broadbent: The minister is still not being perfectly clear: not being bound by a treaty is not the same as saying the other side will not be allowed to fish. I ask the minister this question: Considering that on May 15, under the provisions of the same treaty, Canadian halibut vessels were guaranteed access to fisheries off the coast of Alaska, can the hon. gentleman assure the House that last week's decision in the United States will not affect this commitment also?


Roméo LeBlanc: I understand that last week's decision related to salmon only. However, I will check to make sure that I am not giving the hon. member inaccurate information. If that is not the case, I will, of course, inform him and the House tomorrow.


HOUSING
Mr. Girard Laprise (Abitibi):: Mr. Speaker, my question is directed to the Minister of State for Urban Affairs.
The minister announced recently a new policy providing for graduated payment mortgages which would have the effect of increasing by more than $9,000 the financial cost of housing. Can he tell us whether this measure which has an adverse effect on the small owner was taken following a meeting with
May 8, 1978

private lenders or whether this decision was taken at their request?


Harvie Andre: Mr. Speaker, when talking about this mode of financing by graduated payments, the hon. member should understand that this method gives access to ownership to a relatively young family which would like to buy a house but has not got the financial resources of a person who has been established for a long time, and provides for much lower monthly payments in the first years of occupancy. These graduated payments increase as the incomes of the family increase. This method, which is largely used in the United States, enables young families to buy a house sooner than expected to live in it and to benefit from it from the very first years of their family life.


SUGGESTED REPLACEMENT OF MORTGAGE SYSTEM BY PROGRESSIVE REDUCTION OF INTEREST RATES
Gérard Laprise: 
IMMIGRATION
Mr. Bill Jarvis (Perth-Wilmot):: Mr. Speaker, in the absence of the Solicitor General I would direct my question to the Minister of Employment and Immigration. It relates to reported activities of foreign agents, namely, those in the
Oral Questions
employ of the Korean Central Intelligence Agency and specifically to the situation whereby a vice-consul of the South Korean consulate has applied for refugee status. Can the minister tell the House whether that refugee status has been granted and, more particularly, can he confirm that there were intelligence activities in Canada directed against that vice-consul, Mr. Yang, by members of the KCIA?


Hon. Bud Cullen (Minister of Employment and Immigration):: Mr. Speaker, to answer the second part of the hon. member's question, he is correct that there are only allegations to that effect. I am certainly not privy to that particular information at this time. With respect to the first part of the question, an application for refugee status was made by a vice-consul, Yung-Man Yang.


William Herbert Jarvis: Mr. Speaker, I asked whether that application had been favourably received. I am not sure what the minister is privy to, but I hope that if there are agents of the KCIA operating in Canada and harassing those of Korean nationality or Korean origin, the minister would be privy to what is going on. 1 therefore ask for his assurance that this was a specific, isolated incident in which four of these agents allegedly had as their objective, Mr. Yang. If he cannot give us that assurance, will he undertake to inform the House, at the earliest possible date, of the nature and extent of the activities of the KCIA in Canada?


Jack Sydney George (Bud) Cullen: Mr. Speaker, I apologize. The application for refugee status is being studied at the present time by the Refugee Status Advisory Committee. We anticipate a decision within a month. In so far as allegations of the nature suggested by the hon. member are concerned, obviously if they existed they would be checked out by the RCMP.


MANAGEMENT OF SPORTS AND RECREATIONAL ASSOCIATIONS
Otto John Jelinek: Mr. Speaker, my question is to the Minister of State (Fitness and Amateur Sport): it relates to the massive and costly blunders within the minister's portfolio which have left 50 or so amateur sport and recreation associations in debt to the tune of $8.3 million.
The minister well knows that I respect her objectives. However, in light of these revelations by official auditors, will the minister tell the House why she or her predecessor, who is now the Minister of State for Federal-Provincial Relations, failed to provide competent management to the many sport and recreation associations, and what counter-measures are being taken against the incompetence which failed to protect taxpayer's money as well as the interests of amateur sport in Canada?


Hon. Iona Campagnolo (Minister of State (Fitness and Amateur Sport)):: Mr. Speaker, I think the most important

May 8, 1978
Oral Questions
point is that all the moneys have been retrieved. They have been retrieved under my direction. This action has been strongly and decisively taken with the full co-operation of all the sport-governing bodies involved.
I want to give the hon. member some facts and figures. There was not $8 million outstanding; the amount outstanding was $5,258 million. There were over 756 projects and 98 associations. That was the audit as of March 31, 1977. The audit as of March 31, 1978, is as follows: seven associations, 26 projects, and $200,000 outstanding.


Some hon. Members:: Hear, hear!


Iona Campagnolo: I would still like to give the hon. member one small piece of information: to date there has been no cost to the taxpayers of this country.


Otto John Jelinek: Mr. Speaker, notwithstanding the minister's answer, it is my understanding that the result of the mismanagement which did occur is that it threatens the basis of a number of amateur sport bodies in this country. Can the minister say what disciplinary action she has taken against those responsible for creating the mess-whether or not the mess has now been established-and what steps is the minister taking to ensure that it will not happen again in this country? It is obvious that a lot of mismanagement did take place in her department in the past.


Iona Campagnolo: The hon. member is well aware of how sport-governing bodies in this country operate. They are autonomous and they have operated through a different style of adminstration, through amateurs and volunteers, from one end of the country to the other. They have done their very best to be responsible, but in difficult circumstances. It was for that reason that this government undertook to put into force the National Sport and Recreation Administration Centre which allowed a proper base of administration for the various sport-governing bodies which are part of the over-all sport group in Canada.
I believe that on the matter of fiscal responsibility, the facts and figures which I have already given the hon. member speak for themselves; but I am also determined that there must be stronger action-which was needed-so I did a rather unusual thing: I asked the Auditor General to set up a specific program for sport-governing bodies in this country. This was undertaken many months ago. It is now in full force and all sport-governing bodies are co-operating and returning dollars in the way they should, and advancing their programs in an orderly manner.


Some hon. Members:: Hear, hear!


Steve Eugene Paproski: We want Iona as minister of finance.


POST OFFICE
Hon. W. G. Dinsdale (Brandon-Souris):: My question is for the Postmaster General. Could he inform the House if terminal A, on Front Street in Toronto, has been closed down, resulting in the transfer of the bulk and parcel mailing facility on a temporary basis to the Canadian Arsenals warehouses which are not ready for handling this procedure? Also, can the hon. gentleman inform us whether this is causing a backlog in mail from and to western Canada?


Hon. J. Gilles Lamontagne (Postmaster General):: Mr. Speaker, in view of what happened to my colleague from Brandon-Souris, I had better answer in French to avoid any play on words in English and make sure that I am perfectly understood. I have no information concerning any backlog of parcels at the present time in the Toronto area. I think that any backlog at this time is minor and normal and that it should be possible to deliver these parcels without any delay.


Walter Gilbert Dinsdale: With respect to the emergency operation at Canadian Arsenals warehouses, can the hon. gentleman indicate whether this results from the breakdown of the computerized operation at the Gateway terminal because of the failure of the COMDEV computers to operate successfully? Also, to overcome the problem is the Postmaster General considering calling for new tenders for new equipment which will make it possible to use the expensive equipment at Gateway and remove the backlog which, I am sure, if he inquires, he will find is already occurring in the warehouse operation and also will remove the hazards to inside postal workers at the Gateway plant referred to in a recent article in the Globe and Mail!


Mr. Lamontagne:: Mr. Speaker, I do not think that the postal workers are running any risks by working in Gateway. There is no question either of calling for new tenders to replace the equipment already there. Any problems resulting from mechanization are only normal. In the development of a technology such as the one we are now developing in the Post Office, which is practically unique in the world, snags are to be expected, and it may be necessary at times to close down a plant or part of a computerized operation in order to improve it and make it more efficient.
May 8, 1978


FISHERIES
[Stage Direction]
Oral Questions
unfortunate test conducted by the Canadian ministry of transport last year in the United States?
Mr. Donald W. Munro (Esquimalt-Saanich):: To come back to the question of the hon. member for Oshawa-Whitby, I have a supplementary for the Minister of Fisheries.
Since the minister expects to take similar steps against American fishermen, can he tell the House in detail what means he has at his disposal to implement such measures effectively, probably forbidding access to our waters to the American fishermen?


Hon. Rom6o LeBlanc (Minister of Fisheries and the Environment):: Mr. Speaker, I should like to check the exact translation of what I said. If my memory serves me right, I did not speak of taking reciprocal measures. I said that if the temporary agreement arrived at by the two governments has not been ratified and is not in effect, obviously we are not committed to an agreement that is neither ratified nor existent.


NEGOTIATIONS ON COASTAL ISSUES-GOVERNMENT POSITION
Donald W. Munro: 
FINANCE
Joseph Jacques Jean Chrétien: Mr. Speaker, I am not aware of any report, any rumour in that respect. I will check, but I would be very surprised if the U.S. administration had decided to act that way.


Mr. MacKay:: The minister, of course, is aware that there was a 10 per cent excise tax imposed in 1974 by his predecessor, Mr. Turner, on American aircraft, which was part of the so-called Canada energy conservation program at that time. In view of the fact that this tax appears to have been poorly conceived and is discriminatory in its application, is the minister thinking of removing the tax at this time?


Joseph Jacques Jean Chrétien: Mr. Speaker, I have received several representations on that subject and I am now examining the problem.

* *


TASK FORCE ON HEAVY OIL RESERVES
Mr. Don Mazankowski (Vegreville):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources. Having regard to the key role which heavy oil reserves must play in overcoming Canada's dependence on imported oil, and given the fact that there has been considerable delay in reaching agreement of the Lloydminster heavy oil upgrading facility, can the minister tell the House what position the government has taken on the proposal by the president of Husky Oil that a task force be made up of representatives from Husky, the federal government, provincial governments and other interested parties to speed up the decision on this much needed facility?


Hon. Alastair Gillespie (Minister of Energy, Mines and Resources):: It is being discussed at the present time. I think there is a good chance that the task force will come into being in the not too distant future.


Elmer MacIntosh MacKay: Mr. Speaker, I have a question for the Minister of Finance. Is he aware of, and is there any cause for concern in Canada as a result of the reports of a strong lobby building up in the United States by some aircraft manufacturers for the imposition of a 25 per cent import tax against the Dash-7 and the Challenger aircraft, perhaps as a result of the substantial taxes against certain types of U.S. aircraft, as well as the fall-out from the


Donald Frank Mazankowski: With regard to the continuing delay in reaching agreement on this very important facility, and given the great amount of lead time that is required in terms of establishing a facility of this magnitude, is the minister prepared to state to the House today or in the immediate future what new initiatives the federal government might be proposing in order that this project can be lifted from the negotiating table onto the drawing board?

May 8, 1978
Oral Questions


Alastair William Gillespie: Mr. Speaker, the hon. member will recall that the budget made a number of very significant changes which should help to bring on the development of heavy oils: the Cold Lake heavy oils, the tar sands, the expansion of GCOS and projects of that kind-very considerable projects. Also, I suspect the hon. member is aware that the federal government now is awaiting a response from the provinces. The federal government has placed a series of incentives on the table. The House passed a bill which provides a world price for the product of these new, major undertakings. Now we are waiting to hear from the provinces as to what they are prepared to do to get these very significant projects off the drawing board.


TRANSPORT
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, in the absence of the Minister of Transport I should like to direct my question to the acting minister, the Secretary of State for External Affairs. On March 7 the Minister of Transport left the impression across the country that the government is providing some SI6.3 million in terms of grants to expand the port of Prince Rupert in British Columbia. Recently, the Albert Wheat Pool was informed by the National Harbours Board that the users will have to pay for these developmental costs, namely, the farmers who use the terminal at the port of Prince Rupert. Can the minister clarify the government's position? Is it the government's intention to provide these facilities, as it has in the past, or will the user indeed have to pay?


Hon. Donald C. Jamieson (Secretary of State for External Affairs):: Mr. Speaker, I am afraid I am not in possession of the details, at least not sufficiently to answer the hon. member fully. I would ask his indulgence to take the question as notice and I will pass it on to the Minister of Transport.


SMALL BUSINESS
Mr. R. E. McKinley (Huron-Middlesex):: Mr. Speaker, my question is directed to the Minister of State for Small Business who has the unpopular responsibility for metric conversion. Recently, I was advised that mix-ups and delays seem to be the order of the day when the metric commission is processing applications for the rebate on metric tools from mechanics and others who have no way of deducting these purchases as business expenses. Can the minister tell us what the problem is, or is this just another case of government inefficiency?
[Mr. Mazankowski.1


Hon. A. C. Abbott (Minister of State (Small Business)):: Mr. Speaker, there have been some 4,000 applications for refunds under the metric tool assistance program, and I think some 1,200 have been paid $135,000. The others have not been paid, as a result of insufficient information or some mistake in the applications. I have urged the officials to take what steps they can to make it as easy as possible for applicants to receive their refunds.


Robert Elgin McKinley: Mr. Speaker, I appreciate the minister saying that he has made it as easy as possible. However, I would like to know why it takes six weeks to send out a notice indicating that the commission has received the application and another six weeks to send out a notice indicating that more information is necessary. Why cannot the information indicating that the application has been received be sent out within two weeks and, if more information is necessary, why cannot a notice be sent out at the same time?


Anthony Chisholm Abbott: Mr. Speaker, I must say I am inclined to take the hon. member's representation as a valid one.


DEVELOPMENT OF NEW SOURCES
Harvie Andre: Mr. Speaker, my question is directed to the Minister of Energy, Mines and Resources. Last night, on the CBC program "The Nation's Business", the Minister of National Defence stated-


An hon. Member:: Is that who it was?


Some hon. Members:: Oh, oh!


Harvie Andre: -that the country would receive imminent economic growth largely as a result of significant energy projects coming on stream. Specifically, he mentioned the tar sands plants, heavy oils, the Polar gas pipeline and Fundy Bay tidal power. I must have missed the press release in this regard. Therefore, can the Minister of Energy, Mines and Resources tell the House when these projects were approved by cabinet, when construction will be started and when they will be finished? Also, when we can receive all the other details about cost, sponsors and those things which will lead to this great economic growth in the near future?


Alastair William Gillespie: Mr. Speaker, I would be very pleased to go down the list with the hon. member. Let us start with tar sands III in the Athabasca area: the federal government has put a series of proposals forward which will make it much easier for that particular consortium, headed by Shell, to bring it to fruition. I believe Shell is waiting to hear from the Alberta government; similarly, the Imperial Oil project at Cold Lake, to produce
140,000	barrels a day. It is well advanced. We have put our proposals on the table in respect of tax incentives. Imperial Oil has indicated a favourable response to our proposals and also is
May 8, 1978

waiting to hear from the Alberta government. Of course, GCOS is another very significant-


Some hon. Members:: Order.


Mr. Speaker:: Order. One supplementary, the hon. member for Calgary Centre.


Harvie Andre: Mr. Speaker, I gather none has been approved by cabinet as yet. Also, the Minister of National Defence talked about the Liberal policy of self-sufficiency in energy. Given that on January 27, during debate on Bill C-12, the Minister of Energy, Mines and Resources ridiculed the policy of self-sufficiency as put forward by myself, can the minister tell the House when cabinet dropped his policy of self-reliance and adopted the Progressive Conservative policy of self-sufficiency?


Some hon. Members:: Hear, hear!


Alastair William Gillespie: Mr. Speaker, I was unable to complete my list. I had reached GCOS and I intended to talk about some of the other heavy oil projects in western Canada. I can shift very easily to the maritimes because the hon. member also asked about the Maritime Energy Corporation and the Bay of Fundy tidal power. The federal government has taken the decision to move forward to phase II. We have taken the decision, with the Newfoundland government, to move forward with the creation of a Lower Churchill Falls Development Corporation for bringing that massive source of energy, roughly 2,000 megawatts, into production.


An hon. Member:: It is 3,000 megawatts.


Alastair William Gillespie: We are unable to be a self-sufficient nation overnight.


Walter David Baker: Did you hear that, Barney?


Alastair William Gillespie: By pursuing these policies of self-reliance, I think we can look forward to the day when we can be substantially self-sufficient. As hon. members from maritime areas will recognize, there may well be occasions where we would not be able to generate or provide all the energy from western Canada in the form of oil for the use of people in the maritimes. In that case, we will have to import some. To that extent, we are not completely self-sufficient; we will have to continue using our buying power where we can. Our policies of self-reliance are aimed at making Canadians self-reliant in every energy sense of that word. I would very much like to refer to some of the other projects we have. I have not dealt with-


Mr. Speaker:: Order, please.


Some hon. Members:: Hear, hear!
Oral Questions


NEGOTIATIONS RESPECTING NEW SOURCES
Walter David Baker: Mr. Speaker, I should like to direct a question to the Minister of Energy, Mines and Resources. Would he assure the House, in all the negotiations which will be required for these projects yet to be considered by the federal government and the provinces, that the Deputy Prime Minister and President of Privy Council will be carrying on those negotiations, rather than the Minister of Energy, Mines and Resources, so we can be assured there will be none of this nonsense during the course of negotiations which we have observed during oral questions today?


Alastair William Gillespie: Mr. Speaker, I was trying to give the hon. member opposite the benefit of the doubt. I thought the hon. member asked a serious question when he wanted to know what the government's position was in respect of some of these massive western projects, projects in the maritime area and Quebec. If hon. members opposite are not serious about these massive projects, let me assure them and all Canadians that we are.


Some hon. Members:: Hear, hear!


FISHERIES
Mr. James A. McGrath (St. John's East):: 
James Aloysius McGrath: Mr. Speaker, my supplementary to the minister is: Will we have the right of boarding and inspection, as we had under the old agreement, in order to ensure that quotas are being respected? Also, can the minister assure us that we

May 8, 1978
Oral Questions
will put our own house in order within the 200-mile limit to stop some of the hanky-panky that is going on between Canadian fishing companies? The minister knows what I am talking about.


Roméo LeBlanc: Mr. Speaker, I think the hon. member's last point is a very important one. In fact, I reaffirmed the suspension of a large trawler from Nova Scotia last week because I felt that if we are penalizing small lobster fishermen for a half dozen lobsters, we should start penalizing large vessels even if it means some hardship for those plant workers who are dependent on the landing of that fish. The time when companies could say they could not control their captains is finished as far as I am concerned. We will control the company and the captain, if we have to, with the power of this parliament.


Some hon. Members:: Hear, hear!


Roméo LeBlanc: As for the new regime, obviously the surveillance regime which will be in place when the successor to ICNAF-which will be known as NAFO- has a regime like ICNAF. We will be allowed to board and report violations.


ARRANGEMENTS WITH U.S. ON RECIPROCAL FISHING
Benno Friesen: Mr. Speaker, my question is to the same minister. Just five days ago the minister made a speech in Quebec City, part of which was entitled "What Can Go Wrong". As we know now on the west coast, plenty can go wrong. I would like to read a sentence or two from the joint report to the governments of Canada and the United States:
The negotiators have agreed to recommend to governments the terms of interim arrangements to govern reciprocal fishing during 1978. The proposed arrangements would continue reciprocal fishing as previously agreed, with new mechanisms for consultation and resolution of differences and to help ensure that existing fishing patterns are maintained.
Could the minister tell me what has gone wrong?


Fabien Roy: Mr. Speaker, nothing has gone wrong yet. There was an injunction, and that will be dealt with according to the normal process. As I said in answer to an earlier question, the two special negotiators who signed this recommendation to the two governments are meeting this week. The hon. member should also know that the American agreement has to be ratified by the U.S. Congress. To my knowledge, this has not yet been done and that, obviously, poses some difficulties when the administration goes before the courts.


SCALLOP FISHING ON GEORGES BANK
Mr. Lloyd R. Crouse (South Shore):: 
EXTERNAL AFFAIRS
Mr. Douglas Roche (Edmonton-Strathcona):: Mr. Speaker, I direct my question to the Secretary of State for External Affairs. Over the weekend the United Nations Security Council condemned South Africa for its raid deep inside Angola. This raid may have sabotaged the prospects of SWAPO agreeing to the western compromise plan for independence in Namibia because SWAPO will fear further South African intervention. Because Canada presented the UN plan for Namibia on behalf of the western nations, what steps is Canada now taking to maintain the momentum for a peaceful settlement of the Namibian question in ways that go beyond condemning South Africa-for example, putting pressure on SWAPO to accept the western proposal before it is too late?
May 8, 1978


Donald Campbell Jamieson: Mr. Speaker, the hon. member, in his last sentence, answered his own question. Obviously, the answer now is indeed to condemn the South African action which we did unanimously in the Security Council on the weekend, and also to continue to do everything possible to persuade the South West Africa People's Organization that their best interests are going to be served by accepting the proposals of the Group of Five.
As to what Canada has done, I have met personally with Mr. Nujoma to urge him to take this course of action. I did that at the United Nations, and I believe it is today-certainly this week-that all five of the countries represented in this initiative will also be meeting with him to provide clarification for him as to just what our proposals entail.


Douglas Roche: Mr. Speaker, the South African strike at the guerillas in Angola highlights once more how Cuba is recklessly endangering world peace by maintaining 30,000 troops in Africa, including Angola-action that undermines Canadian influence for a peaceful settlement in Namibia. Does Canada intend to exert pressure on Cuba to get out of Africa by terminating our aid program in Cuba and, even more importantly, taking further steps through the United Nations to put economic pressure on Cuba?


Donald Campbell Jamieson: Mr. Speaker, I have answered this question in a number of different places and also on a number of occasions here in the House. I have said that by my personal recollection we have declared, both directly to the Cubans at the United Nations and in other fora, our reluctance to do anything by way of encouraging the situation in Angola and our high regard and high desire-that would be the more appropriate word-that the Cubans should withdraw from that area and that there should be no foreign troops in Africa.
The next part of the hon. member's question is whether we will exert more pressure and use that through the foreign development fund. I have said before, and I repeat now, that what is in place in Cuba is a series of programs which have been active for a number of years and which are now coming to an end. There is a great necessity-I want to remind the House of this-for us to retain a relationship with Cuba with regard to, for instance, the sale of cattle and a variety of other Canadian products to that country. If the hon. member wishes to propose a complete abandonment of all relations with the country, that is something we can consider. We are phasing down, or at least winding up, those programs which were in place some time ago.
I have said before, and I repeat now, no new programs have been made. I would think there is a reasonable assumption to be drawn from this, that obviously we will be much more inclined to co-operate and to develop our relationship with that country and with others if there is a stable situation with regard to Africa. I emphasize once again that we have joined in every condemnation of Cuban participation in Angola and elsewhere in Africa, and we will continue to do so.
Privilege-Mr. A. Lambert


NATIONAL DEFENCE
Mr. Andrew Brewin (Greenwood):: Mr. Speaker, may I address a question to my congenial friend, the Minister of National Defence? I think it was on April 8 that he told the hon. member for Victoria that Canada had not developed any attitude at all with regard to the proposed deployment of the neutron bomb. A month has gone by since then. I now ask the minister, in light of the importance of NATO to Canada, the fact that the neutron bomb is supposed to be used there, and the fact that deployment of the neutron bomb may be important to the future peace of the world, has the government made up its mind regarding its attitude toward the neutron bomb? If so, will it announce that view to the House and the public so we can see where Canada stands on this important issue?


Hon. Barney Danson (Minister of National Defence):: Mr. Speaker, as members of the alliance, we are the non-nuclear power. We do not have any nuclear weapons, nor would they be deployed on our soil. Until there is some reasonable degree of consensus within NATO of those nations who would stock or use the weapons or have them deployed on their soil, it would be a little unbecoming of us to make our position known. We must have a better idea of how the NATO nations themselves feel about it and, indeed, whether the United States decides to proceed with the production of those weapons.


Francis Andrew Brewin: A supplementary question, Mr. Speaker. Is the minister aware of the fact that the governments of Holland, Norway, Denmark and Iceland, for example, have made a clear and positive stand in regard to this matter? How long is the minister going to say that it is not of concern to the people of Canada? I know we are not a primary nuclear power, but we are part of the set-up of NATO: we have troops there. I suggest to the minister that it is irresponsible not to make clear where we stand on this issue.


Barnett Jerome Danson: Mr. Speaker, certainly those nations would be much more directly involved than ourselves. My colleagues and I have had discussions on this matter with our allies, but a definitive position has not yet been developed. While I am on my feet, Mr. Speaker, I should like to say how happy I am to see the hon. member back in good health. I hope he will be with us for a long time.


PRIVILEGE
Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, I rise on a question of privilege and, under our rules, I take the first opportunity to do so and tell the Chair and all hon. members

May 8, 1978
Privilege-Mr. A. Lambert
how indignant I as well as my colleagues are with the CBC, as members of a registered Canadian political party whose national leadership convention took place in Winnipeg on May 7, 1978. In my opinion, that convention was a national event which deserved to be broadcast live, particularly by a Crown corporation which is supposed to promote harmony in Canada by reporting in an objective way the most significant national events either of a political, economic or social nature. Now, on May 6 and 7, a national leadership convention was held in Winnipeg to elect a new national leader of the Social Credit Party of Canada, the successor to Andre Fortin who was killed in an accident on June 24, 1977, after only seven months as leader and successor to Real Caouette, this great Canadian who has founded our party and directed it for 14 years.
Mr. Speaker, CBC was aware of this national political event since it had several reporters on the field who did their best considering they were not provided with the facilities for direct broadcasting of the main highlights of this convention. I do not blame the reporters but the management. I fail to understand why CBC, with a yearly budget of half a billion dollars out of the taxpayer's pocket, would not use part of this money to broadcast such an important political event, while it does not hesitate to allot broadcasting time to all kinds of sports programs. In this area, it goes to great lengths, but when the time comes to inform the public objectively on State affairs, it does not seem interested in promoting the commonweal as well as national harmony.
Mr. Speaker, the Social Credit Party of Canada is a national party whose activities deserve to be broadcast by the CBC at least as much as those of the Quebec Liberal party whose convention, last April, was extensively covered by the CBC. The Social Credit Party of Canada convention, which I attended together with many delegates from Quebec, took place in an orderly fashion, and we believe our activities are likely to promote harmony in Canada. I am convinced that our activities and the positions we took were not likely to urge the people to dissent and question the established order, to promote disorder, but were designed rather to explain to the people what options we have to offer as our contribution to the administration of our country.
Mr. Speaker, do we want or not to ensure the survival of our democratic system? If so, it is essential that all Canadians be given a fair deal in all areas, particularly with regard to information, especially from a Crown corporation like the CBC. What is happening exactly? For two weeks, we have seen on Parliament Hill several vans with CBC equipment and employees; I do not know for sure what they were doing there, but anyhow, it is a fact. I will not believe for a minute that it was not possible for the CBC to be in Winnipeg on May 7 with the required equipment to broadcast live at least the movers' and the candidates' speeches from 11 a.m. to noon, as well as part of the vote and the speech of the elected leader, as is done when the other Canadian parties hold their conventions.

Mr. Speaker, it is true that our party strongly opposes the financial dictatorship and the monopolistic handling of the nation's credit but that is no reason to treat us unfairly. Those are the kind of injustices which raise indignation among honest people who have the right to know the various options offered to them by the different Canadian political parties. The new leader of the Social Credit Party of Canada is the leader of a nationwide party and, as such, he is entitled to the same consideration as any other leader by the Canadian Broadcasting Corporation. The economic, financial and political ideology which has inspired the administrative principles of provincial governments in Alberta for 35 years and in British Columbia for a quarter of a century deserved another kind of treatment, particularly when one considers that our political formation has had and still has members duly elected in the House of Commons, whether from the east or from the west.
Mr. Speaker, Canadian television viewers, either from the west or from the east, expected to have live coverage of the proceedings of that convention. They were deeply disappointed. The people of Quebec with more than 300 delegates attending the convention in an effort of co-operation toward greater harmony between eastern, central and western Canadians hoped to live those developments via the television. Air time is used for other things, offensive movies, cruel and violent movies, there is time for that! Furthermore, Mr. Speaker, and I draw your attention more particularly on that, on Saturday May 6 on the 10.30 news the words Progressive Conservative party were used to announce a convention of the Social Credit Party of Canada. Was that a mistake? If so, well, we have people who do not have much brains to carry out their responsibilities. If it was done on purpose, they should be fired. This is not the way to run democracy in this country.
Mr. Speaker, you will understand why as House leader of the Social Credit Party of Canada I am taking advantage of the first opportunity available to point that fact out to the whole people of this country so such situations will not be repeated, otherwise we are headed toward disorder. When they are treated injustly people end up revolting. Such injustices can turn pacific people into revolutionaries. Mr. Speaker, I want to conclude with a motion to show how logic we are in our comments and protests. I move, seconded by the hon. member for Abitibi (Mr. Laprise):
That this House force the management of the Canadian Broadcasting Corporation to appear before the Standing Committee on Privileges and Elections to give before the said committee the reasons which prevented the corporation from broadcasting live the main events of the convention of the Social Credit Party of Canada which ended in Winnipeg on May 7, 1978.
Thank you, Mr. Speaker, for your kind attention.


Mr. Speaker:: Order. I am under the impression the hon. member for Bellechasse (Mr. Lambert) has raised a grievance against the Canadian Broadcasting Corporation rather than a question of privilege concerning the proceedings of the House. But of course we will have to wait for the hon. Secretary of
May 8, 1978

State (Mr. Roberts), who is responsible for the CBC, to have an opportunity to comment on this matter. I will then make a final decision.


Joseph Adrien Henri Lambert: Thank you, Mr. Speaker.


POINT OF ORDER
Stan Darling: Mr. Speaker, I rise on a point of order with respect to the answer given to me by the Minister of State for Urban Affairs (Mr. Ouellet). The Minister of State inadvertently, I presume misled the House when he said that I was not there at the committee meeting. I was certainly at the committee meeting in plenty of time. I believe the minister was about 20 minutes late-


An hon. Member:: Thirty minutes late.


Stan Darling: I appreciate the position of the minister, that he was held up on business, but nevertheless I wanted to clear up that point. That committee meeting, I believe, was held Tuesday, April 18. I was trying to elicit from the minister an answer that his officials were there with him, and that we wanted the president of CMHC to be allowed to answer questions. Furthermore I understand the deputy minister who would normally be there to answer questions is on a four-month sabbatical for something or other, and will not be available to the next meeting of the committee.


André Ouellet: Mr. Speaker, by a happy coincidence, I have the "blues" right here and the hon. member says that I accused him of being late for a meeting. He was asking me whether he would be authorized to ask questions at the next meeting of the parliamentary committee. The "blues" I have here show that I gave him the following reply: Mr. Speaker, if the hon. member can arrive on time at the meeting of next week and stay until the end, he will get answers to all the questions he may be prepared to ask. I do not think I said he had been late at a previous meeting. If he can be on time at the next meeting, he will get answers to his questions.



ROUTINE PROCEEDINGS


[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Order Paper Questions
Mr. Roger Young (Parliamentary Secretary to Minister of Justice):: Mr. Speaker, the following questions will be answered today: Nos. 31, 355 and 1,238.


Mr. Cossitt: 1.	Is the Department of National Health and Welfare aware of a new drug known as Probucol with the trade name of Lorelco that has recently been made available through drug store outlets in the United States for the reduction of cholesterol levels and approved by the United States Food and Drug Administration after twelve years of research?
2.	Is the government aware that one of the three doctors involved in the introduction of the drug is a Canadian from Montreal?
3.	(a) What knowledge does the Department of National Health and Welfare have concerning this drug (b) is it being tested in Canada and on what date will it be approved for use in Canada?


Hon. Monique Begin (Minister of National Health and Welfare):: 1. Yes.
2.	Yes.
3.	(a) The bureau of drugs of the health protection branch has evaluated the new drug submission for probucol (lorelco) and for this drug the letter of compliance was issued on August 11, 1977. (b) As of August 11, 1977, the drug manufacturer is authorized to market probucol (lorelco) in Canada as a prescription drug.


Mr. Orlikow: May 8, 1978
Order Paper Questions
hospitals to interns and residents qualifies for federal contributions under the Hospital Insurance and Diagnostic Services Program as part of the cost of insured hospital services. While payments to interns and residents relate to their services to hospitals, they are made while these doctors are in training and, hence, facilitate the acquisition of such training, which these physicians might otherwise be unable to afford. The federal government contributed approximately 50 per cent with respect to the following salaries and wages (including stipends and perquisites) paid to interns, residents and students in public general and allied special hospitals in Canada. 1971, $60,410,187; 1972, $60,275,200; 1973, $63,560,175; 1974, $71,808,493; 1975, $85,766,946. (d) The Hospital Insurance and Diagnostic Services Program also contributes towards the costs of full-time geographic professors in teaching hospitals. The portion accepted under HIDS relates to these doctors' services to the hospitals, and not to their teaching function. However, these payments by the hospitals represent an important part of the income related to these teaching positions, and indirectly contributes towards educational objectives. These contributions are not reported separately, therefore there are no data available.
2. No.


Mr. Cossitt: 1.	Did Mr. F. C. Passy, Chief of the Canada Student Loans Programme, receive a letter dated September 22, 1977 from Ms. Liz Grogan of CFTO-TV Ltd., Toronto, Ontario, asking for certain information including the "percentage of outstanding loans not repaid at the end of terms" for certain years?
2.	Did Mr. Passy reply to Ms. Grogan in a letter dated October 4, 1977 and did the letter state in part that the default ratio in 1974 was 6.9%, in 1975- 7.2%, in 1976-7.4% and in 1977-7.4%?
3.	Is the government aware that photocopies of computer print out sheets showing the figures and default ratios for the years concerned are in the hands of the honourable Member for Leeds?
4.	Do the computer print out sheets show a default ratio of 7.02 in 1974, 7.85 in 1975, 8.54 in 1976 and 9.01 in 1977 and, if so, what is the reason for the difference in the figures processed by the Department of Finance and the figures issued by Mr. Passy to the news media?
5.	Were any employees instructed to falsify figures at any time and, if so (a) under whose instructions (b) what are their names and job descriptions (c) what are the names of the employees (i) accepting (ii) refusing such instructions?
6.	Was the Student Loan Programme transferred from the Department of Finance to the Department of the Secretary of State on December 1, 1977 and, if so (a) is Mr. Passy still in charge (b) how many employees were transferred with the Programme and what are their names?


Hon. John Roberts (Secretary of State):: In so far as the
Secretary of State is concerned: 1. Yes.
2.	Yes. The figure quoted for 1977 was described as preliminary.
3.	No.
4.	Computer printout sheets are produced on a monthly basis, but not on an annual basis. The figures cited in this question seem to be monthly figures. In any case they are not annual figures. The figure of 7.02 per cent for 1974 cannot be identified as to month. The department has identified the other figures as follows: 7.85 per cent in 1975 is for September; 8.54

per cent in 1976 is for September; 9.01 per cent in 1977 could be either April or September. The figures quoted in question number 2 are not monthly figures, but are the ratios at the year end, in this instance June 30, for each year cited, and are for that reason different from the monthly figures cited in question number 4.
5.	No.
6.	Yes. (a) Yes. (b) Forty-three full-time staff as follows were transferred effective, December 1, 1977 except where otherwise indicated: F. C. Passy (transferred May 1, 1977); N.
L.	Davis, M. E. Temple; R. M. Dodd; J. A. Murphy; R. Leckie; M. Kallio; C. D. Mahony; G. R. Greason; C. G. M. Desrosiers; S. M. Kennelly; N. E. Reeves; L. F. Donegan; M. C. Maley; M. Paquette; J. A. Thorpe; C. A. Bigras; D. Scott;
K.	M. Maddocks; H. Curtis; K. Miller; B. Downey; G. E. R. Young; E. Villeneuve; E. Pearse; J. A. Kipp; C. A. O'Brady;


M. C. Y. S. Parizeau;: P. J. Farmer; W. Magladray; G. Shane;
L.	Nitschky; I. Bedard; R. R. Jarvis; D. P. Meagher; P. M. Costin; N. Hough; D. L. Woodland; R. L. Wallace; R. Panta-lone; A. Saulnier; C. S. Kimber; I. Liss.


Roger Carl Young: I ask that the remaining questions be allowed to stand.


Mr. Speaker:: Those questions enumerated have been answered. The hon. member for Huron-Middlesex (Mr. McKinley).



POINT OF ORDER


Robert Elgin McKinley: I rise on a point of order, Mr. Speaker. My patience is getting very thin concerning the answering of questions by the government. I have had questions Nos. 560 to 673 on the order paper since November 14, 1977. I think it is time they were answered before this parliament is dissolved.


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


Some hon. Members:: Agreed.
May 8, 1978



GOVERNMENT ORDERS


Hon. Jean-Pierre Goyer (Minister of Supply and Services) moved: that Bill C-39, to amend the Currency and Exchange Act, as reported (with amendments) from the Standing Committee on Miscellaneous Estimates, be concurred in.


[Stage Direction]
Motion agreed to.
Jean-Pierre Goyer: that Bill C-39 be read the third time and do pass.
He said: Mr. Speaker, I am happy to take part today in the debate on this bill which includes such interesting objectives as the creation of many jobs, the export of finished products which use our natural resources, the creation of an additional source of revenue for the federal government as well as for the provincial governments, an interesting, profitable and very promising breakthrough for a totally Canadian product on foreign markets, and last but not least, an excellent opportunity to enhance the international image of Canada through the work of our craftsmen and artists.
You are no doubt aware, Mr. Speaker, that the Royal Canadian Mint has succeeded for several years already in getting and maintaining the reputation of being one of the best mints in the whole world. Our special coins programs have always drawn very special attention on national and international numismatic markets. Within a few years, in hardly three years, we have succeeded in getting major deals for minting in Canada coins for more than 30 foreign countries.
Those successes, added to the great success of our coins programs in 1976 for the Olympics and last year to commemorate the 25th anniversary of the coronation of Her Majesty Queen Elizabeth II, have allowed us to secure privileged position on the international numismatic market. Should we be proud of those successes? Yes, Mr. Speaker. Should we be satisfied with those successes? I do not think so, Mr. Speaker. New opportunities are available to us and we want to take advantage of them. That is in summary what is prompting us to introduce this legislation. Through this amendment which is really an administrative measure, we want to allow the Royal Canadian Mint to take greater advantage of the world numismatic market where last year we sold coins worth some $31 million. That is a very impressive performance. However, the overall annual coin market being evaluated at $1 billion, the government believes that the Royal Canadian Mint must continue to draw maximum benefit from it.
Currency and Exchange Act
We realize that a gold bullion coin program as presented to us by the representatives of the Canadian Mining Association appears to harbour a tremendous potential. Far from trying to dispute their claims, we have listened with an open mind. We have been impressed. We sense that for a number of reasons this market might be very ripe for Canada and, Mr. Speaker, we are prepared and ready to pursue actively with the Canadian Mining Association, the other interested industries, and in conjunction with the officials from the Department of Finance, the in-depth study of the potential of such a program and of its various implications for the Canadian government and for Canada as a whole. It would be less than responsible for me to recommend to cabinet a proposition that has not been thoroughly researched and which still contains a number of unanswered questions.
There are currency implications that need to be identified, clarified, and researched, in a more thorough manner than we have had time to do.
There are gold sourcing complications that so obviously require both short and long term planning far beyond what has been done up to this point. Although Canada happens to be the third largest gold producer in the world, our total output at present is approximately 1.5 million ounces of gold a year. This bullion coin program could absorb 2 million to 3 million ounces a year. Even if the prospects are very exciting, hon. members will agree with me that the question of the gold supply is one that will require a great deal of consultation, compromises, and commitments both from the gold mining industry and from the government as the holder of the Canadian gold reserves.
There are production and distribution set-ups that have to be put in place and that have to be guaranteed before the first coin ever reaches that market.
These are some of the questions that I and my officials have been asking ourselves concerning this program. But let me not leave hon. members with a feeling of pessimism about this program. That would be too easy a solution and one that Canada certainly does not need at this point in time. My comments should not be construed as being negative toward this new idea but rather of expressing my willingness to explore this innovative concept.
Let me assure hon. members that, although we have been asking questions, we know the answers will be forthcoming. We know that we have the people, the resources, and the desire to pursue this idea and to bring forth in due time recommendations to cabinet as to its feasibility and profitability.

If on the one hand we did not have time yet to explore thoroughly that new project, on the other hand we certainly have concrete evidence of the success obtained by our two previous gold coin programs. Our $100 gold coin program commemorating the Olympic Games, our first major initiative
5234

May 8, 1978
Currency and Exchange Act
in that field, sold nearly one million coins, which represents a total exceeding $100 million.
Last year, to mark the Jubilee of Her Majesty Queen Elizabeth II, the Royal Canadian Mint issued another $100 gold coin. Over only four months, about 180,000 coins were sold for a total value of almost $25 million.
Those two programs were very successful owing to the numismatic quality of those coins and also to our strong marketing efforts. Now that this distribution system has been established and its efficiency proven, it deserves to be supported regularly to produce maximum benefits. Through this bill, the Royal Canadian Mint will be able to establish long term planning for that kind of numismatic coins which would certainly guarantee it an increasing share of that enormous international market and better profitability for its production facilities. This year we intend to issue once again a $100 gold coin. If one of the major assets of a numismatic coin is its technical quality, its artistic quality is also very important. There are excellent Canadian artists in this field and I wish to mention only one of them, Raymond Lee, a Toronto artist whose design of provincial floral emblems was chosen for the gold coin commemorating the Queen's Jubilee.
To facilitate the work of the artists and ensure a certain uniformity in their submissions it has been decided this year to select the theme of national unity. And the submissions already received seem particularly interesting. To conclude I wish to mention the excellent co-operation of several hon. members who have studied this bill in committee and particularly the work of my excellent parliamentary secretary, the hon. member for Trinity (Miss Nicholson). Following their representations we made some amendments that will certainly facilitate its passage. First, the governor in council will be given this power for a period of three years only. The government will have to review that decision before January 1, 1981. Finally, the minister in charge commits himself to report to Parliament every six months on the relevant details of this gold coin program. Far from infringing on the rights of Parliament, this bill will enable hon. members to follow very closely the progress made, and to judge over the next few years the benefits derived from such a program.


Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, I rise on a point of order. I wonder if the minister would permit one or two questions before I commence my speech.


Jean-Pierre Goyer: Yes, Mr. Speaker.


Sinclair McKnight Stevens: It has been rumoured that there may be other countries bringing out bullion gold coins, something contemplated by our mining industry in Canada. What is the timeframe the government is thinking of with regard to deciding definitively whether it is going to have a Canadian bullion gold coin or not?


Jean-Pierre Goyer: Mr. Speaker, I have already met with the representatives of the Canadian Mining Association. The officials of the Mint have met with them on a number of occasions to explore the different problems and to try to find the right solutions to those problems. In fact I am meeting again tomorrow with the representatives of this important industry.
The main problems are the question of currency, and to look, with the industry, not at a bullion bust production but a normal production, and the extent of our needs. When we find solutions to these problems, I intend to present a proposal to cabinet. Of course my colleague, the Minister of Finance (Mr. Chretien), will have to parallel his mind with regard to the problem of currency.


Sinclair McKnight Stevens: How soon?


Jean-Pierre Goyer: As soon as we have the authority, which will come from this bill, to proceed.


Sinclair McKnight Stevens: The minister referred to the commemorative coins which, it is contemplated, are to be brought out this year, and suggested that national unity would be the theme. Is there still time to dissuade him from adopting the theme of national unity for this purpose, or has a definite commitment already been made within the cabinet? Further, can the minister tell us the deadline toward which he is working in connection with the minting of these coins, should the bill receive speedy passage?


Jean-Pierre Goyer: In answer to the first part of the question, the theme for the current year was the choice of the board of directors of the Royal Canadian Mint. It was not imposed by the government. In fact, the reverse is the case. Now that the board of directors has decided on a theme, the ratification of the governor general in council needs to be obtained, so whether it is advisable to use this particular theme in the present year has still to be considered. I am ready to take into account arguments directed to this question. Indeed, the expression of such opinions will help the cabinet make a final decision.
With regard to the later part of the question, if we are given authority within the next four hours to proceed with the gold coin program, the first pieces will normally be issued next fall-I cannot give a specific date. That is what I am told. The urgency is this: we do not wish to lose the momentum of what we now consider to be an established world market for Canadian coins of this type. Every year, now, collectors will expect Canada to issue such a coin and, if we are not in a position to do so, the marketing of this national resource in the form of a finished product would suffer an important disruption.


Sinclair McKnight Stevens: Mr. Speaker, as the first to take part in this debate on behalf of the official opposition I should like to say at the outset that we have some rather grave reservations with respect to the bill now before us.
We expressed those reservations during the committee stage and were able to secure two significant amendments to the bill as presented. First, the authority we could be giving to the

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cabinet with respect to the minting of gold coinage would be operative only between the present date and January 1, 1981. In the second place, there would be a provision for reporting at six-month intervals back to parliament setting out exactly what had been done in terms of the coinage which had been minted.
These amendments have made the bill somewhat more acceptable, but there is a fundamental misunderstanding with respect to what we are now considering. The mining industry in Canada is interested, almost eager, to see the Mint put out what is generally referred to as a bullion gold coin. The most popular form of such a coin is, of course, the South Africa Krueger Rand, a 1-ounce gold coin priced directly in relation to the current value of gold. If, for example, the price of gold is $160 an ounce, the price of the Krueger Rand coin would be $160, give or take whatever is needed for the commission. This is what the mining industry is hoping will be minted in Canada.
However, I sense that what the government is mainly interested in is not the production of a gold bullion coin but another commemorative coin. And, of all things, what it is thinking of, to judge what was said by the minister, is a gold coin commemorating national unity! Such a coin, to be widely distributed throughout the world, would, by its very terminology be broadcasting to all the other nations, in effect, that there is some kind of disunity question. This is a strange twist. The domestic problem suddenly becomes glossed over by the minting of a gold coin on the theme of national unity, a coin which will be circulated around the world, broadcasting the message that somehow or other disunity in Canada is something which must be considered.
I do not know who are the public relations officers for the government or for the Mint. The minister told us it was the board of directors of the Mint who decided on this theme. In my opinion a new set of public relations officers is needed.
It is utter rubbish to suggest that a country as great as Canada, which has experienced 110 years of Confederation, can find no theme to put on a coin other than that of national unity. Let us take a more positive theme, for example, a theme commemorating our great scientists, or, if you like, our great statesmen, or our great northern frontier. Let us choose a theme based on the positive things we have to be proud of, and let us not become consumed with the issue of national unity when it comes to an application of this kind.
We have misgivings about what the government is trying to do, on three grounds. First, we believe the government should be more candid on the subject of the issuance of a gold bullion coin. If the minister has no interest in issuing such coins, let him say so, and let those concerned judge the government accordingly. In any case, he should quit pussyfooting around- today, for instance, the minister indicated that an in-depth study would be conducted. Our second reservation has to do with the theme of these commemorative coins which are to be brought forward in the fall. Our third and more fundamental concern has to do with the way in which the government is treating the coinage of this country.
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Hon. members will recall that the government got into a very odd deal at the time of the Olympics. In order to get the Prime Minister (Mr. Trudeau) off the hook with regard to his promise that he would never use taxpayers' money to fund the Olympics, the government came up with the odd concept of minting Olympic coins. They were legal tender, but as far as their seigniorage was concerned the proceeds were to go to the Olympic Corporation as opposed to the treasury of Canada. At various stages of that legislation we in the official opposition opposed it because we felt the government was being reckless with the coin of the realm and that greater safeguards should have been included. In fact, to some extent at our urging safeguards were put into the legislation to ensure that the coinage would not be completely debased or used in a way which traditionally coinage of this country is never used, that is, for private gain of some concern outside the government or the people of Canada. There was a rather sad spectacle with regard to the Olympic coinage.
The Minister of Supply and Services (Mr. Goyer) said today that the government has had great success with its coin programs and that he was hoping that this would continue. That is just balderdash. There has not been success with coinage programs. Let me give the House some figures. For those who are interested I am referring to the report to parliament as of September 30, 1977, of the Minister of Finance with respect to the Olympic coins. As we all know, the Minister of Finance was required to report to parliament regarding various aspects of that program.
As of September 30 the face value of Olympic coins issued pursuant to the Olympic (1976) Act was $279,692,765. Olympic coinage of a face value of almost $280 million was sold. Here is the real grabber. Guess how much of that money ended up with the Olympic Corporation? How much of the almost $280 million actually found its way to the Olympic Corporation? At the bottom of page nine of the report of the Minister of Finance it shows that the aggregate amount of all payments to the Olympic Corporation was $100 million. By the time sales costs, which were astronomical, and other costs-the various minting costs and so forth-were written off-almost $180 million had dribbled away, and only $100 million went to the Olympic Corporation.
Our coinage was debased. We put a few grains of silver into coins and called them silver coins. We then put a few grains of gold into some other coins and called them gold coins. We sold them around the world saying that they were silver and gold coins, but the fact is that they were neither. In each case there was only a percentage of silver or gold. There has to be a stop to this debasing of the nation's currency.
The inflation we have in this country is due largely to the unfortunate printing of money which has been carried out by this government through its control of the Bank of Canada. I am not saying that we should return to the gold standard, that somehow gold should become a new standard or barometer or that we should not issue a gold coin which is not 100 per cent gold, but I think it is questionable as to how long Canada
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should be in this game of minting coins, not because we need them for general commerce or for trade, but because the government thinks this is a cute little gimmick it can use to sell coins to people around the world who are coin collectors. That is what is before us today. How long should we tolerate gimmicks with regard to our coinage?
The coin which is contemplated to be sold under the theme of national unity will not be 100 per cent gold. It will have some portion of gold. We will hear later how much gold will be in it. It will sell for something over $100. It will have a face value of $100, but the truth is that, just like the Franklin mint or any other private minting operation, the government more and more is getting into the game of creating coinage, not because it is needed for commerce, which is the basic reason we have coinage and paper money, but because it is a cute gimmick to make a few dollars on the side and because there are many people who are willing to buy these coins. This is Barnum and Bailey stuff. If Barnum and Bailey had had the authority, they certainly would have been involved in this in order to get a few more shekels into their coffers.
The sad thing is that this illustrates as much as anything how this government is not inclined to deal with the fundamental problems we have, but is going for tokenism and for these symbolic things, and thinking it is solving problems by bringing out a $100 gold coin and calling it a national unity coin. What would have had a more positive effect would have been a government which showed proper restraint in its spending and which demonstrated to Canadians and to other investors throughout the world that it did have meaningful plans to reduce the deficit with which we are living.
The tokenism has to end. The idea of creating coinage with a theme which will be beneficial as far as national unity is concerned misses the point. There are basic problems which must be solved. Let the government get on with solving them, and the national unity problem it speaks of will solve itself. We need something more fundamental than the minting of another coin.
The inflation we have in Canada is due in large measure to the overprinting of money in relation to our real growth. Let there be no doubt that the inflation we have is due, to a large extent, to the overprinting of money. From 1973 to the end of 1977 our average inflation rate has been 9.3 per cent. If we were to project that ahead until 1981, the purchasing power of the 1977 dollar would be 70 cents, and the purchasing power of the 1971 dollar would be only 44 cents. Since the emperor took power in Canada our dollar has fallen below 50 cents in value compared with what it was valued at in purchasing terms the year the emperor took over. With that type of inflation and with that type of devaluation in terms of purchasing power, this government now comes before us and tells us that one of the top priorities of the government is to get parliament to pass Bill C-39 permitting the government to mint a debased gold coin. That is nothing short of shocking.
Let me give the House some other figures. If the government allows 9.3 per cent inflation to continue-and we cer-

tainly have no evidence that it will try to restrain its spending-every eight years we will double the level of inflation.
Not only have we inflation, but now we have the result of virtually uncontrolled inflation, which is rising unemployment. Here again, if we are to project ahead and if this government, heaven forbid, should ever be allowed to continue in power, we will have, by 1981, 1,280,000 Canadians out of work. That figure is compiled by simply following the trend that has developed since 1973 as a result of the economic activities of this government.
These are hard figures. For example, real growth has fallen in the last four years to slightly over 3 per cent. In fact, if it is projected ahead to 1981, we will find that we will be five years behind so far as our target of social growth is concerned. Those are the facts, and here we have the government of the day saying that there is nothing more serious in Canada than the authority, which it wants, to mint a $100 gold coin in the name of national unity. There are over one million Canadians out of work; inflation in Canada is running at 9.3 per cent; real growth, if it is projected ahead to 1981, is five years behind; and the government of the day is saying that the most urgent thing for Canadians is to mint a new gold coin commemorating national unity.
Let me mention something else, and this is perhaps the saddest spectacle of all. Let us take a look at the deterioration of revenue in this country so far as the federal budgetary position is concerned compared with federal budgetary expenditures. In 1975 revenue went up about 28 per cent at the federal level. In that year the government's expenditure went up 28 per cent. In other words, the government spent 28 per cent more in 1975 than in 1974 and that was, luckily for members of the government, the amount of revenue they had that year.
I mentioned that year because let us not forget that was the year the government spent money to be re-elected. The 28 per cent spending spree which we saw in the fiscal year 1975 started in 1973 and was amplified in 1974. The name of the game was to get re-elected at any cost, come what may. If inflation in the country were to go up, Mr. Turner, who was the minister of finance, under the dictates of the emperor of the day, the Prime Minister, obviously said, "Let her go". That is what we in Canada are now living with. We are living with the aftermath of what the government did to secure its re-election in 1974, because it was so disturbed by being put in a minority position on October 30, 1972, that it said, "Turn up the printing presses, get federal government spending in motion, give the people an illusion of wealth, and let the inflationary consequences come later". Ministers thought they could ride out the inflationary consequences as well as the unemployment which would result.
Here are the figures. They said they were on a restraint kick. The fact is that in 1976 expenditures in this country went up by 16 per cent; in 1977 they went up 14 per cent; and in 1978 they went up 10 per cent. The average rate of increase in
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expenditures since 1974, the last year that we had an election in this country, has been 17 per cent. For the government of the day, with that kind of background, with a 17 per cent increase in fiscal spending, to be coming to parliament on May 8 saying; "Give speedy passage to the currency exchange Bill C-39 so that we can mint a few more gold coins on the national unity theme" shows the priority that this government has and how little concern it has for the level of inflation which exists now in the country, and for the unemployment levels.
Having said that, I would like to state, if I may, why I feel it is unfortunate that the government has developed the attitude it has with regard to gold. Gold is a unique commodity, whether we like it or not, and has been in that unique position for centuries. In any civilized country you will find that gold has played a unique role for centuries.
Various books have been written on the subject of gold. One which I read over the Easter break was entitled "The Golden Constant-The English and American Experience, 15601976". It was written by Roy W. Jastram, Professor of Business Administration at the University of California, Berkeley. In this book, which is a compilation of various data concerning prices, the price of gold and the relationship of prices to gold, the author reaches some very interesting conclusions. If I may, I should like to read parts of the book into the record. At page 179 of this book, Mr. Jastram says:
Gold prices do not chase after commodities; commodity prices return to the index level of gold over and over. This is one of the principal findings of my study.
Let me explain. It is commonly said-and certainly the author of this book has mentioned-that gold is thought to be a good hedge against inflation. The author points out that, if you look at the last 400 years, that assumption is not correct. Gold is not necessarily a good hedge against inflation. But he does point out that it is a tremendous hedge in times of a depression because, as a rule, if you have held gold during depression periods, you have made your best money.
What the author is saying in what I have just quoted is that there seems to be an odd relationship between commodity prices and gold, and that commodity prices can get out of line but eventually they return to the constant price of gold. He gives decade by decade, and in fact century by century, proof of what he is saying. To quote him again from page 179 of his book, he writes;
My feeling is that it is beyond rational belief that this event could occur by chance alone, with the observed frequency, over the last three centuries.
He points out that this is why gold is constant. He then goes on to point out that there are various forms that a gold standard can take if a nation wishes to go on the gold standard. He says:
The essential characteristics of the classical gold-coin standard are as follows:
All forms of money, paper and otherwise, are held at a parity with a coined monetary unit defined by its gold content and are convertible into this gold coin on demand.
This monetary unit is coined freely, without an appreciable charge for the process itself.
Gold coins circulate freely and may be freely exported, imported, or melted down.
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Gold is unlimited legal tender.
Gold constitutes a large part of the nation's central monetary reserve.
The author then goes on to state that, with some risk of oversimplification, it can be said that governments of the day tend to change this type of gold standard in various ways, which he enumerates as follows:
1.	Paper currency does not have a 100 per cent gold reserve behind it. There is not enough bullion in the world today to support world-wide trade, commerce, and finance on a one-to-one basis of paper to gold ...
2.	The world price of gold may increase (drastically, as it has in the 1970s) so that either the admissible volume of paper currency will automatically inflate or the required reserve ratio of gold will have to be reduced correspondingly.
3.	If the price of gold is to be held constant by the marketplace, gold must be bought or sold by the government in quantities precisely decided by the government, or interest rates adjusted by central banks to accomplish the same purpose by indirection.
4.	If the price of gold is to be held constant by edict, the market for gold must be interdicted by the government, for example, exports forbidden, imports embargoed, private boardings outlawed, and so on.
Governmental interference at any one of these points is, of course, a denial of laissez faire. This is not to say that a gold standard would be impossible today. It is to say that the gold standard as a dehumanized, self-disciplining dispenser of monetary justice is a myth.
Any monetary system needs to be managed. The real questions are how and to what extent.
What are the basics people understand when it is said that we should follow the gold standard? To what degree is it realistic to expect any nation to go on a gold standard today? As the author indicated, it is not realistic to expect nations to return to any type of gold standard.
Why is there concern about gold? There is concern about gold because it has remained a rather constant thing through the centuries. If our citizens wish to have a convenient way to hold gold, they should be allowed to do that. That is why we support the concept of a $100 or $50 gold bullion coin. It provides Canadians with a convenient way to acquire gold coins. It saves them from buying the most popular bullion coin, the Kruger Rand. It provides them with a convenient way to hold gold, which has been done traditionally by people over the centuries. It is not that those people will be able to keep up with inflation by holding gold, but it will provide them with a constant which they can hold, along with their other investments, in order to ensure, if economic problems occur, that constant will retain its buying power, whereas various other investments will not hold the same buying power.
Page 189 of the same book in part reads as follows:
Gold has two interesting properties: it is cherished and it is indestructible. It is never cast away and it never diminishes, except by outright loss. It can be melted down, but it never changes its chemistry or weight in the process ...
Its price has been remarkably similar for centuries at a time. Its purchasing power in the middle of the twentieth century was nearly the same as in the midst of the seventeenth century.
As far as I am concerned, that is a significant thing. Gold has remained relatively constant in its purchasing power over the centuries. It is unfortunate that our government has taken the concept of minting gold coins and debased it in the name of making money. There is nothing wrong with bringing out a

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gold coin in Canada. In fact a S20 gold coin was brought out at one point. That coin contained $20 worth of gold. Now it sells at a substantial premium of well over $100 because the gold contained in that coin has a purchasing power today which is comparable to what it was then.
If the government is given the authority to mint the commemorative coins it talks about, a fraud will be perpetuated on the buyers of those coins. This coin is referred to as a $100 gold coin. Many people will buy it thinking that it contains $100 worth of gold, without realizing that it contains very much less gold. In short, they are paying for something at a premium which does not contain $100 worth of gold. It is a shame to use our currency in that manner. It is a shame that money cannot be made internationally in a more effective manner than simply taking the coin of the realm, striking new themes, and attempting to flog it around the world in order to make whatever revenue the government sees fit. With the billions of dollars of imbalance in Canada, surely there is a more meaningful way to bring revenues into the coffers of our country without debasing the coinage of our land.
We have grave doubts about parliament's wisdom in providing the cabinet with authority to go ahead with any minting program concerning gold coins. Those doubts have been lessened somewhat by the 30-month limitation on the authority and the six-month reporting under the Olympic Coinage Act. It is time for the government to come to its senses. It should realize that many of the things it has done over the past decade obviously are not working. One cannot count on building a credit economy indefinitely, without the resultant repercussions of inflation and unemployment such as we are experiencing today.
If I had more time, I would speak-


Stanley Howard Knowles: You have a little more time.


Sinclair McKnight Stevens: I see my socialist friends are egging me on.


Stanley Howard Knowles: You can take time until parliament is dissolved.


Sinclair McKnight Stevens: If I were to talk until parliament is dissolved, knowing how upset the emperor is with the polls today, perhaps I would talk well into 1979.
In conclusion, I should like to direct the attention of hon. members to a book entitled, The Coming Credit Collapse. It is an interesting book which deals with world economy and currencies. It is authored by Mr. Alexander P. Paris, who is well known in the economic world. His degrees include a B.A. and an M.B.A. from Michigan State, and an M.A. in economics from Wayne State. He has been an active executive with various international trading organizations. In his book Mr. Paris pointed out that the credit explosion which has occurred cannot continue, and it will collapse if there is not more restraint and responsibility at the governmental level. In view of that, we should be very careful when we deal with the bill

before the House now. It is another small step toward further irresponsibility in the handling of Canadian economic affairs.
How much trust can we have in the government of the day? Because of the current account deficit, the government went into international markets to borrow funds, and it is not even aware of who its creditors are at the present time. I was not present in the Chamber on Friday, but I read Hansard of that date. I could hardly believe what I read when I discovered the Prime Minister thought he had borrowed $3 billion on behalf of the Canadian public from Citibank in New York. How totally out of touch can the Prime Minister be, and presumably the Minister of Finance (Mr. Chretien)? They went to bed on Thursday night believing that the $3 billion credit was arranged with Citibank in New York. Yet the Prime Minister indicated that if Citibank took in deposits from somebody in South Africa, so what, that was their business. I invite Your Honour to telephone New York and find out the facts. Citibank did not put up more than $175 million of that $3 billion credit. They could not because they are restricted to the amount they can put out on any one credit and they in turn syndicated the loan around the world.


The Acting Speaker (Mr. Ethier):: Order, please. With all due respect to the hon. member, would he please limit his remarks to the bill before the House and not on what was said in the House last Thursday.


Sinclair McKnight Stevens: Mr. Speaker, I do not know how much more directly I can deal with the bill. The bill is the new Currency and Exchange Act, and the specific power that the government is asking for is the right to mint various gold coins. These gold coins become part of our over-all money supply, and what I am saying is that that money supply has been over-inflated and extended through the unwise use of credit in this country beyond all limits. I am simply saying that, considering the past decade, how much trust we have in the government of the day which, come 1978, is forced to borrow on international markets, and the Prime Minister does not even know who his creditors are with respect to the borrowings that they have had to arrange in New York to shore up our dollar?
It is all one ball of wax, and all I am saying is that I would have expected, at least days after the event, that the Prime Minister and his Minister of Finance would have realized that the loan or line of credit they received was one that was actually syndicated around the world, and that a portion of that standy-by credit was offered to South African banks as it was offered to various other banks including Arab banks and so on. I find it rather shocking that they are so little in touch with what in reality is happening that they did not know that simple fact.
I know that hon. members wish to speak further on this bill.
I hope that it will not be passed simply as an administrative function because it is much more serious than that. In short, I think it is another example of a rather irresponsible attitude on the part of this government with respect to a very, very serious
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matter in this country, and that is the unsatisfactory economic condition of the nation.
Perhaps I did not have to speak so long, but surely if anybody had watched "The Nation's Business" on Sunday night they would have seen the Minister of National Defence (Mr. Danson) trying to defend the economic record of this government, and they would have drawn only one conclusion, and that would be it is a dismal record.


Mr. Arnold Peters (Timiskaming):: Mr. Speaker, in speaking on third reading, I would like to say first that I come from an area where much of the economy has been built on the gold mining industry. In my opinion, we have done a great deal for the rest of Canada and its development, through the gold mining industry. It was with deep regret that we saw the passing of gold mines in Kirkland Lake, Larder Lake, Timmins and Matachewan, Pickel Crow, and other little communities across northern Ontario, and the fact that not much could be done to help them.
Over the years I have followed with great interest this argument that the member for York-Simcoe (Mr. Stevens) raised in relation to gold. I take very seriously his comment, which was facetious I know, when he said that the Minister of Finance (Mr. Chretien) did not really know where he was borrowing the money from and thought he was borrowing it from someone, but it turns out he is borrowing it from somebody else altogether, with a very small portion of it actually coming from Citibank. That highlights the inability of this government and of preceding governments, both Conservative and Liberal, to get through the morass of financial arrangements that exist around the myth, and I think it is a myth, of gold, the gold standard, the silver standard, and other backings we have for money.
The only things you can back money with are resources and work. Those are really the only two things that back any economy, and you can use whatever yardstick you want. We got along fine in this country without either gold or money for a long time, when we used beaver pelts. You piled them up so high against a rifle and that was the number of pelts you paid to purchase that rifle. When we talked about gold 20 years ago we were only talking about a yardstick. The yardstick got too expensive and was artificially controlled at a very low price. We controlled it throughout the world at $35 for years, after going up from $28. Now the actual price is $42.50, but in practice it does not amount to that at all.
In 1976 the mining industry came to the minister of mines in Ottawa and asked him for some help because the price of gold rose up to $150 and dropped back to a little over $100. When he was asked for help he made the statement that "he could not subsidize the gold industry to protect the miners and the mining communities because, if he did, he would have to subsidize other industries as well." Well, we have subsidized those other industries. It would be very interesting to know how much money we have paid to keep the rubber goods industry in this country, and how much we have subsidized the textile industry. However, we have not been able to do too much to save either one of them in the process. We could not
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do anything to help the gold mining industry for the very simple reason that we were in love with the International Monetary Fund.
The International Monetary Fund was born out of the failure of the Bretton Woods Agreement, when the Bretton Woods Agreement decided that one of the major factors in the last depression, which really resulted in World War II, was the inability of governments to provide enough money to make the purchases that were necessary. There was an unequal balance between the cost of goods, the necessity of those goods, and the dollars that were looking for those goods. It was decided that we would not curtail our money supply but that we would operate it on the basis suggested under the Bretton Woods Agreement where we would, in effect, maintain gold at $35 but "demonetize" the gold to the point where it was no longer the official backing of the money that was being put out.
They went further in the International Monetary Fund to where they allowed the world to establish drawing rights, and those drawing rights did not have to be backed with gold. That has failed because, while the countries and the banks put up a large amount of money for the International Monetary Fund to assist in the very worth-while project of developing the third world countries, almost none of those third world projects have repaid the money. There are billions of dollars, approximately $500 billion, floating around the world. Approximately $300 billion American are floating in Europe, and if those dollars were called, the United States would be bankrupt tomorrow. For this reason the President of the United States withdrew the backing of gold on dollars so that you can no longer redeem a dollar with gold backing. This has resulted in $300 billion floating around in Europe that are not worth the paper on which they are written. They are only worth that amount if they will be accepted by somebody else in trade, and everyone is very nervous about that. For this reason there is much collection of gold by private individuals.
There has been a lot of manipulation in gold by governments. The reason the mining industry was hurt in 1976 was not because of anything they did. They had raised wages in the industry over the years and had done some other things which brought them into the twentieth century. When I worked in that industry we often accused them of being in the nineteenth century because of their attitude toward workers and working conditions, but eventually they brought wages and conditions into line. That brought their cost up to $130, but they maintained that theirs was only a temporary problem and that gold would go to $200. They asked the government for help, but were refused. That was shortsighted of the government, Mr. Speaker. There are about 22 million ounces of gold in the treasury which were accumulated between 1948 and 1974 when we operated under what was called the Emergency Gold Mines Assistance Program. We accumulated about $1 billion worth of gold at $35 per ounce plus the maximum assistance of $10.27. If we are still holding that gold which was accumulated at about $47 per ounce and which is now worth $200 per

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ounce on the market-in fact we could sell it to the United States for more than $200 per ounce-we are in good shape.
We helped the mining communities for 15 years and made a lot of money. We only did badly when we took the advice of the Department of Finance to send it to Fort Knox in the United States at $35 per ounce. We lost $10.27, the EGMA subsidy, in that way but made a lot of money on the gold we have-in fact something in excess of $150 on today's market.
For these reasons I was interested in the gold coin proposition. It was an indication that the government was on the right track-not the officials of the Department of Finance, because they are plain stupid. There are 2,000 economists working for the government, who earn in excess of $30,000 per year. I think every one of them went to the same school and learned the same thing, but since they left the universities they have not learned anything. They really are not very bright.
The government decided to issue a gold coin, for two reasons: first, it is a good way to commemorate certain events and, second, there is a big market in the numismatic field. The government was already selling silver dollars. At one time it sold one of each coin in a celophane package, worth about $1.91 for $3. The mint did quite well on that. Now they package them in boxes and, for a coin worth $20, you pay $40, but it can sell for $200 on the market. I would not be surprised if the Department of Finance, being a bunch of pack-rats, put the lot in a backroom somewhere and eventually they will really be worth something. I know that in my office I put them in a drawer in a cabinet, and eventually they disappeared by attrition. Perhaps that also happens in the Department of Finance, but eventually they will reach the market and make some money, we hope.
I am in favour of the coin business, Mr. Speaker, and I think we have done a good job. I am quite proud of the Mint. In fact I am quite proud of the Post Office because our artists produce some excellent designs and they are well executed. Proof coins in this country are as good as any I have seen anywhere. I did not see anything wrong with the first $20 coin we issued, although ministers of finance made a lot of fuss. When the Hon. Donald Fleming was minister of finance we had not seen gold coins in Canada for 20 years. He got some bad advice from his departmental officials who told him we would be back on the gold standard and be the laughing stock of the world if we issued a gold coin. As a result he decided not to issue one. The next minister was the late George Nowlan, who got the same bad advice and did not issue a coin either. When Walter Gordon became minister of finance he was persuaded it would be a good idea to issue a gold coin for the centennial. That turned out to be successful, and a number of gold coins have been produced since.
It is interesting now to see how the Department of Finance officials are all in favour of this program and even suggest that the Mint can run a night shift. If we are going to issue something in the order of 190,000 of these coins with a half ounce or less of gold in each, that will not use much of the 22 million ounces of gold that we have. If we were going to go to the bullion coin, that is, a coin issued by the country which has

to be coinage and has to be legal tender, I would suggest that it be low in face value, say a $50 coin. The government is going to be broke and the mines are going to be broke. We will be looking at a new economic ball game because, if the price of gold falls to $50 per ounce, so will everything else fall. I hope I have lived out my days by the time these gold coins turn up in the banks at $50 each. The $50 will not be the redeemable amount but it will be legal tender.
That one ounce of gold will be in competition with the Krueger Rand and the Swiss and French gold coins-


An hon. Member:: And popcorn souvenirs.


William Arnold Peters: The hon. member mentioned popcorn souvenirs. Right now they are selling for something like $176 so, if that is a popcorn souvenir, that is fine because a lot of people are buying them. In October, 1977, South Africa sold 405,000 Krueger Rands versus 216,000 in the year before that. As I understand it, South Africa is only issuing one coin, the one-ounce gold Krueger Rand which is not legal tender. The price is set by their government and is subject to change. South Africa is by far the world's largest producer of gold and we are told that they use between 10 and 15 per cent in this form. There is a fast growing international market for the coin.
A representative of the mining industry told us in committee that we are producing about 1.6 million ounces a year. There were 110 producing mines and today there are only ten or 12 left. Two or three of those mines are threatening to close within the next few years unless incentives are provided for development of new ore properties to make them worth-while.
I was impressed by the minister indicating that he really had not been advised up to that date of the potential. The minister's role is not really to sell gold. That job belongs to the Minister of Energy, Mines and Resources (Mr. Gillespie). He said there is no way he would have anything to do with that. So I was not surprised that the Minister of Supply and Services (Mr. Goyer) was not too familiar with this matter. I think he was pleasantly surprised to learn that the mining industry anticipates that sales in the first year could consume two million ounces of newly minted gold. If that is so, it would mean that we would have to increase our production to close to the three million ounces a year to meet the new demand and continue with the contracts the mining industry already has in the industrial field. It does mean an increase in mining, and that would only be the beginning.
There are not many people in Canada, unless they are in the finance department, who would not agree that gold being produced in Canada and sold as a coin, backed by the Canadian government to a degree by indicating its fineness, its karat and other characteristics as well as a limited legal tender, would not have a better appeal than South African gold on the world market. How many people in the United States buying gold in large quantities are buying Krueger Rand because there is no alternative? I believe these people would buy
May 8, 1978

Canadian coins if there were no difference in price or in any other way simply because they are not satisfied with the political regime in South Africa. I believe it would soon evolve into a voluntary boycott by all sales agents in the United States and, instead of handling South African coinage, they would handle Canadian coinage as a replacement. If that were the case we would have to be prepared to go into production on a large scale in the first year. The Master of the Mint has said there would be no difficulty in his field in going into production to that degree very quickly. As well, he has expressed the view that the Mint could go into production within a very short time.
I believe the minister was enthusiastic in this regard. As I said he does not hold the mining portfolio or the financial portfolio. I am sure that he saw an opportunity for one of the agencies under his control, the Canadian Mint, to expand its operation, employ more people, and maybe make a profit as well. There was no indication that we would do this for nothing. It would carry a cost that would cover the production costs of the Mint and carry the cost of the Department of Finance for picking up the gold and having it for a short period of time. There was no indication that this would be a cost. However, I believe he will run into all those red necks, or whatever you call them, who are terrified there will be an implication that we will hurt in any way, shape or form, the International Monetary Fund and that we will establish the gold standard in Canada again.
It seems to me that Canada is lucky because there is a large amount of gold available in this country. There are and have been mining prospects in every province of the nation, with the exception of Prince Edward Island. These prospects add a price. The price of gold depends entirely upon the amount of reserves there are available. The higher the price goes, the larger the reserves are; the lower the price, the less reserves there are. By doubling the price of gold it is probable that the lifetime of some of those mines that are to close within the next two or three years will be extended by 20 times. What yesterday was waste will be valuable ore tomorrow.
On behalf of the gold mining industry I sincerely hope that the minister will be able to persuade some of the other cabinet ministers that what we are talking about is not going back on to the gold standard and not going back into monetized gold in the true sense, but going into business to take gold, prefabricate it into a coin, and to put it on the market for those who wish to buy it as a commodity.
It is interesting to note that holdings are not that large. In 1970 767 tons were being prefabricated in the world. In 1976 that figure went up to 823 tons. In 1976 total fabrication was 1,359 metric tons of gold. For medallions, fake coins and official coins there were 178 metric tons. For private bullion, which category these coins fit into, there were 89 metric tons going into that field.
Our gold production last year was only 52.4 metric tons. The bullion market was 89 million tons. For Canada to get involved in that to the degree anticipated, we would be talking
Currency and Exchange Act
about several hundred metric tons. That would mean a great increase in the production of gold across Canada.
I do not see that this proposal will upset, influence, or shake money markets. If there is any way that could be done, it is already in effect. Money markets are being shaken all over the world. Revaluation and devaluation are rapidly taking place. In my opinion, very shortly in some countries around the world there will be a devaluation and deflation will take place. That will create a large market for this type of bullion coin which will be used as a hedge.
I support the idea of this matter coming back to parliament by regular report. I appreciate the minister making that decision in committee. He said he would do it without consulting anybody, which is a good sign. He also made the suggestion, without consulting anybody, that he would be prepared to pursue this idea of bullion coins. I hope he will have great success. This is the first bright light that has shone on the gold mining industry since the price of gold started fluctuating so rapidly two or three years ago. It does not mean that the gold mining industry will make more money. What it does mean is that the amount used in fabrication each year will be stabilized.
These gold bullion coins will provide a stabilizing factor in our mines. They are not asking for a hand out. However, the relationship between the Canadian dollar and the United States, Europe, and other parts of the world, means that this industry is more the victim of our economic structure than any other segment of our economy. They will certainly be more than appreciative if the government brings about some stability, even if that is through the minting of gold coins.


Mr. Bill Clarke (Vancouver Quadra):: Mr. Speaker, I entered the debate on second reading some days ago. At that time I was pleased to give approval to the bill for second reading in order to get it into committee where we could properly examine what was going on. That, of course, happened. It had three days in committee where, I am sorry to say, we did not get the kind of answers that the government should have provided to the opposition parties.
The overwhelming complaint that was raised at second reading of this bill was the fact that these coins would be produced by the authority of an order in council. In other words, it was the government's intention to take away the power of parliament in one fell swoop for all time with regard to gold coins. That point was raised over and over again, in particular by the right hon. member for Prince Albert (Mr. Diefenbaker). That avenue was explored in the committee. It is my opinion that the government and the minister did not come up with the proper answers to that complaint.
It was said at one of the committee hearings that it would not be possible for the Mint to plan ahead sufficiently without a bill like this in order to lay out the possibilities for production and planning in the Mint. I wish to refer to the minutes of the April 27 meeting of the Standing Committee on Finance,
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Currency and Exchange Act
Trade and Economic Affairs, issue No. 24.1 asked the Master of the Mint the following question:
Would it be possible to operate the coin scheme that the Mint wants to operate under the guidance of a bill which was more specific than this?
The Master of the Mint replied:
It would surely be possible, Mr. Clarke, because in the past I think the approvals of gold coins have been specific approvals. The problem with a specific approval is you have approval for one program but the market for gold coins is a very important one abroad.
He went on to explain the marketing of gold coins. I may touch on that later. At that meeting the Parliamentary Secretary to the Minister of Supply and Services (Miss Nicholson) was only able to refer to the legislation on Olympic coins with specific authority. That was not what I was asking about in committee that day.
At that same meeting I asked the Master of the Mint if he was looking for more specific direction from this kind of a bill. I said:
If the Mint has already projected a plan for producing and marketing coins, then why can we not hear about it? I think that is the problem that faces us with this bill.
The Master of the Mint replied:
There is no plan because there was no act of parliament on the basis of which we could produce a gold coin in advance.
He stressed the fact that they needed to be able to plan for up to five years. He went on to say, and I quote:
If we knew in advance that we could have a gold coin program for five years to come, we could plan in advance for themes for the five yeas to come,-
The point is that parliament could have considered a bill which could have given the Mint authority to conduct a program over a period of years. However, we are being asked to approve a bill which gives authority to the governor in council to approve any kind of coin program. It is true the government has indicated it would be able to live with a time limit. In fact, the time limit will be something less than three years if this bill and amendment are approved.
Planning is obviously lacking both on the part of the government and the minister. I want to refer to the minister's remarks. He stated today that obviously further planning is needed and that there are further details that need to be laid out in order to get this program going.
I do not think hon. members, particularly those on this side, can approve a bill which states that the power of parliament will be taken away and given to cabinet on important matters such as issuing coins of any denomination, and in any quantity, all the way down the line. The minister said today that he cannot tell us the government's plans in the precise confines we would like to know about them. If the minister is not able to tell us, we cannot expect the Master of the Mint to tell us what is going on.
I want to refer again to the meeting of April 27. In answer to a question, the parliamentary secretary stated with regard to the planning for a program that the government had had in mind to introduce a Mint Act and possibly some amendments to the Currency and Exchange Act. We now have another

example of the government changing its mind. The parliamentary secretary stated at that time, and I quote:
As time seemed to be going past, what was lifted out of that package was this bill, which was intended to give the authority to get on with the commemorative coins and protect that market, with the idea that the more in-depth discussion you are talking about, Mr. Clarke, would happen at a later date.
I can understand that, but I do not really like it. I asked:
Is there no more specific plan the Mint could give us now as to the plans, broad plans, they have for this program?
The Master of the Mint replied:
-we do not have a plan now, but it would not be a problem to prepare such a plan because we know how many coins we sold in 1977.
I hope that is an adequate illustration of the fact that we should give very serious consideration to whether this bill should be supported at this stage because of what it will do to the power of parliament with regard to issuing coins, to the Mint which is not able to plan, as well as to the cabinet which will have to decide what will be issued under this bill, because that really has not been decided at this time.
One indicator that more planning is needed before, not after, this bill is passed is that only one theme has been determined, national unity. That is to be the theme of the first coin. The Master of the Mint indicated that it had not yet been decided what other themes might be used down the road.
I cannot imagine how a national unity theme could be depicted on a coin. We did not hear anything about that in committee. How will it look to outsiders? After all, these coins are aimed at the outside market, not the Canadian market. How will it appear to the purchasers of these coins to have Canada telling the world, by some theme on a coin, that Canada has a national unity problem? After ten years under the direction of the Prime Minister (Mr. Trudeau) it should be obvious that we do have a national unity problem, but I am not sure I want to see Canada's problems aired abroad on the face of a coin. I find this theme an objectionable one. And to me it seems strange the government should want to advertise the fact that there is a unity problem here by making unity the theme of a coin to be circulated in the world market.
Furthermore, the government has made no commitment with regard to the priority it would place on the issuance of the various coins in respect of which it is seeking our approval. My point is that the bullion coin program is one seen by the mining industry and by the government itself, according to speeches which have been made, as being the salient one. Yet neither the minister nor the parliamentary secretary in the committee was able to give us any assurance that the bullion program would be stressed. The Master of the Mint had certainly received no instructions from the government telling him which would be regarded as the primary program.
It is interesting to note that the industry, in its representations, stressed the number of jobs which would be created by the program which is proposed. I was interested to hear the hon. member for Timiskaming (Mr. Peters) expressing his support for the gold mining industry. I do not often hear hon.
May 8, 1978

members in that group to my left speaking as did the hon. member for Timiskaming today on behalf of the gold mining industry, but I can understand his doing so because there are a lot of people in his area who are employed by this industry.
It appears the industry was told by the government that this was a non-partisan bill and given the impression that their cause would be helped if they were able to get around and visit as many members of parliament as possible to seek support for the measure. There is certainly no lack of support on this side of the House for the gold mining industry, but we must take into account that the bill has implications which may be more serious than the question of jobs in the gold mining industry, for example, the request to delegate these additional powers to cabinet.
I should like to deal with the job aspect for a few moments and see how the industry's submissions stand up to examination. In committee, on April 24, I was asking about the creation of jobs at the Mint as well as outside in connection with related products such as blanks and cases, as well as in mining and related industries. The representative of the industry was asked why the gold had to be made in the form of a coin. He replied that if there were to be sales in a foreign market the object had to be a coin. A coin could not be produced by a private corporation; it had to be produced by a government. The representative of the mining industry went on to explain that it would be unsatisfactory to issue a medallion because such a product would be dutiable on entry, say, into the United States. The amount of duty was later identified as being 17.5 per cent. A medallion would not be the equivalent of a bullion coin.
We have heard from my hon. friend from York-Simcoe about the degree of fluctuation in the price of gold. The value of a gold medallion could vary widely, but in the case of a $100 gold coin the "downside risk" is a lot less than in the case of a gold medallion. The language of the trade describes such a coin as an investment vehicle. I asked why the effect on employment would be greater if a coin were issued, and why a similar effect could not be obtained from minting medallions. The representative of the industry replied that the gold mines could not sell enough of their production at a price which would make a profit-
I see it is five o'clock, Mr. Speaker.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Speaker:: Pursuant to Standing Order 40, it is my duty to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for
Adoption Benefits
York-Simcoe (Mr. Stevens)-The Canadian economy; the hon. member for Dartmouth-Halifax East (Mr. Forrestall)- Transport; the hon. member for Churchill (Mr. Smith)-Post Office.

Order. It being five o'clock, the House will now proceed to private members' business, notices of motions and public bills.


PRIVATE MEMBERS' MOTIONS
The Acting Speaker (Mr. Ethier):: Item No. 4 in the name of the hon. member for Ottawa West (Mr. Francis).
Should this item be allowed to stand by unanimous consent?


Mr. Herbert:: This item should now be dropped from the order paper.


The Acting Speaker (Mr. Ethier):: Item No. 11 in the name of the hon. member for Don Valley (Mr. Gillies).


Harold Thomas Herbert: This item, too, should be dropped from the order paper.


William Arnold Peters: With the consent of the government.


The Acting Speaker (Mr. Ethier):: Item No. 21 in the name of Mr. McCleave.


Harold Thomas Herbert: This item should be dropped from the order paper.


The Acting Speaker (Mr. Ethier):: Item No. 24 in the name of Mr. Haidasz.


Harold Thomas Herbert: This item also should be dropped from the order paper.


UNEMPLOYMENT INSURANCE ACT
Mr. J. M. Forrestall (Dartmouth-Halifax East) moved:: That, in the opinion of this House, the government should consider the advisability of introducing legislation to amend the Unemployment Insurance Act to provide benefits to the adoptive parent of an infant, similar to the maternity benefits now provided to workers who are unemployed due to pregnancy.
He said: Mr. Speaker, as I have on previous occasions with respect to this motion, I will attempt to be brief. The purpose of the resolution is to give some indication to the government that there is concern in the country about this omission from
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the provisions of the Unemployment Insurance Act. We know that the act very generously and, I think, wisely, provides for the accommodation of mothers prior to and immediately after their terms of pregnancy. That is very good, progressive, and reflective of a concerned society. However, it has always struck me as strange that we have not given consideration to adoptive mothers who bring infant children into their homes. We have not given to these people the attention we perhaps could have.
While bringing an adoptive infant into the home does not necessarily have the same physical stresses of natural motherhood, the adoptive mother, nevertheless, is under some emotional strain. If it is a first adopted child, the situation in the home is not unlike that of the situation in which a child who is the result of natural childbirth is brought into the home. The same care is required, and both mother and father have the same concern for the adopted child. However, we make no provision for the adoptive parent to have the time at home necessary to adapt properly to the new member of the family and to assist that child in adapting to its new environment.
I raised this matter in 1976 and again in 1977. All I have been asking is that the House give some consideration to amending the act to extend benefits to mothers who adopt infants. Perhaps I should qualify my proposal by saying that I do not think this should apply to people who adopt children over a year or a year and a half old. It should perhaps be restricted to parents who adopt children 18 months old or younger, or 12 months old or younger. However, adoptive parents adopting infant children should be extended the same benefits we afford to natural parents.
I raised this matter on March 21, 1977, and also on November 22, 1976. In January of 1976 I wrote to the then minister responsible for the Unemployment Insurance Commission. I received a reply from his departmental assistant in which he attempted to justify the government's stance on the ground of the differing voluntary and involuntary nature of adoption and pregnancy. So that hon. gentlemen will be aware of my continuing concern I would like to quote the crux of his argument as follows:
The payment of benefits to major-attachment claimants who have incurred an interruption of earnings due to sickness or pregnancy, is in recognition of the principle that these conditions, generally involuntary-
I wonder what the mothers and wives of today think of that phrase.
-cause a claimant to be incapable of work. As a generality, the adoptive parents cannot be said to have incurred an involuntary condition which renders him or her incapable of work, as the adoption was, in fact, an act at the discretion of the parents and, under these circumstances, it is not possible to consider the granting of benefits.
I said then and I say today that I think that reeks of bureaucratic idiocy. It makes no sense at all. I want to make the point that that is an argument against the extension to adoptive mothers of provisions similar to those extended to natural mothers. It is wrong, and I think this House would like to indicate to the government that it should be corrected.
We have an opportunity for a few minutes this afternoon to address ourselves to this. I hope there will be comments from

the other side of the House. I want only to commend this motion to the House. I have dealt with it in this chamber on at least two previous occasions, and my comments, feeling, and attitude about this discrepancy have not changed in the two or three years during which we have been confronted with it. Having had a couple of years to consider this matter, and considering that this proposal has the support of hon. gentlemen such as the hon. member for Davenport (Mr. Caccia) and others, perhaps we could persuade the appropriate people to consider extending this simple yet meaningful and very much desired help.
I myself am an adoptive parent. Adoptive parents are very real people who have very real feelings and concerns for the children who come into their homes and lives. When there is an adoption, there is an interruption of work. Perhaps it is not involuntary as it is in the case of pregnancy, but I suggest that it is involuntary in the sense that families which want children and which cannot have them are in fact not doing something voluntary. They are responding to natural instincts. Indeed, of those hon. members in this chamber who are adoptive parents it might even be said that they responded to very deep seated and unselfish urges.
I ask those who follow me to look at the simplicity of this motion. A very simple amendment could be dealt with quite quickly. This is just a resolution but, if the House saw fit, an appropriate and positive conclusion of this debate in general support of the resolution might just cause the government to consider the matter. There are thousands and thousands of families in Canada which would appreciate such a measure. In many instances it is needed, and the need is not superficial. It is real.
Without prolonging the debate or repeating the points I made in previous debates with respect to this matter I would like to commend this motion to hon. members and to suggest to them that it is a further indication of our concern for our society and the people who are in it, and particularly for those who want to bring into their homes infant children and to make them part of their families and lives. It seems only fair that the benefits made available for the involuntary act should be made available for the voluntary act.


Mr.   Chas. L. Caccia@Davenport: Mr. Speaker, the hon. member for Dartmouth-Halifax East (Mr. Forrestall) deserves to be commended for his initiative. It shows that he is inspired by humanistic thoughts and motives. Today there is only one member of his party present in the House, but if he were surrounded by his colleagues he would stand out as a unique member of parliament on his side in that his attitude is different from that of his colleagues.
We have been witnessing for years now a striking contrast in the Progressive Conservative party, the majority of members of which have been going in the opposite direction from that taken by the hon. member. They have been supporting measures and suggestions which would reduce the extent of unemployment insurance and cut down the number of beneficiaries.
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The measure which is being proposed to us this afternoon would expand the number of potential beneficiaries of unemployment insurance. I certainly support that approach for the reasons so well explained by the hon. member for Dartmouth-Halifax East.
His proposal is in even sharper contrast with the attitude of his colleagues when, on the one hand, they rise in the House to protest against unemployment insurance payments and the figures which are announced from time to time in the form of benefits paid to Canadians, and, on the other hand, within a matter of hours or days, they rise during the question period, as did the leader of their party, and bring forward the cases of municipalities in distress because of welfare payments made to unemployed people in certain regions of the country.
I well remember the time-and probably you do too, Mr. Speaker-when members of the PC party were urging the government to reduce UIC payments from 75 per cent to 66 per cent and were urging that certain beneficiaries be cut off the program. Now, when the effects of those measures are being felt in many parts of the country where municipalities are facing difficulties because of the increased number of unemployed people in receipt of welfare, they are the first ones to complain and scream about it.
I sympathize with the hon. member for Dartmouth-Halifax East and I understand his frustrations when he finds himself surrounded by people who do not think like him. We all remember the votes taken in the past on unemployment insurance at the time when the system was modified considerably and when members of the PC party from eastern Canada, from the maritimes, voted against certain measures, understandably so, because they knew very well that unemployment insurance is a good program which brings benefits to people who lose employment for reasons beyond their control, for reasons which have nothing to do with their behaviour and nothing to do with their willingness to work, but who, because of certain economic variations and vagaries over which they have no control at all, find themselves without work.
That is why I am glad to have this opportunity to support the motion of the hon. member for Dartmouth-Halifax East. I think he is quite right. Maternity, whether natural or adoptive, should receive the recognition of society, and the mother should be able to stay with the child in the early, fragile months when the new relationship is developing between them. In that sense he has touched on a fine theme and I think he has the support of the majority of members of the House. It gives us also an opportunity to stress, despite what we read in newspapers and despite what we hear from some quarters, that unemployment insurance is a good program, good for Canada and good for all those Canadians who are unemployed.
Perhaps I should add, before concluding my remarks, that this House needs new measures of the kind brought forward by the hon. member and others, such as, for instance, for injured workers who believe that when they are convalescing and in the process of rehabilitation they should be given the opportunity to contribute to the UIC fund in anticipation of re-entering the labour market, so that when they return to the labour
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market they will at least be covered in case they are not able to find employment with their previous employer.
To those who say that the program is too rich or is costing too much, perhaps we should suggest the desirability of establishing higher premiums and for making better use of the fund because, basically, Canadians want to work, and if they are given an opportunity to take advantage of the UIC fund to undergo certain training, that is for the best. If there is an opportunity to make creative use of the unemployment insurance fund by creating certain jobs in cases where the private sector does not wish to take that initiative, then by all means let us do that. Certainly we can do much more in the utilization of unemployment insurance funds than we have done so far, and the motion put forward by the hon. member for Dartmouth-Halifax East gives us a good opportunity to air a few of our thoughts on this matter.


Mr. Marcel Roy (Laval):: Mr. Speaker, first 1 would like to commend the sponsor of this private member motion to amend the Unemployment Insurance Act to provide benefits to the adoptive parent of an infant, similar to the maternity benefits now provided to workers who are unemployed due to pregnancy.
Mr. Speaker, I think this initiative deserves much consideration given the fact that we are in a changing world where the rules governing the family and society have been changed substantially. I have no intention to discuss whether those changes have improved the quality of life. But we are indeed in a world which is constantly changing and I think the idea of the hon. member deserves some consideration.
But before making any comments on such an initiative I wish to say a few words about the action taken by the Canadian government concerning the status of women. If you refer for instance to the creation in 1967 of the Commission of Inquiry on the Status of Women in Canada which was responsible for looking into the status of women to give women opportunities equal to those of men in all areas of Canadian society, 1 think that initiative of the Canadian Liberal government was a first major step towards a solution to the problem of the status of women in Canada.
Early in 1971, the right hon. Prime Minister (Mr. Trudeau) took position about those conclusions and announced the intention of the Canadian government to give high priority to the recommendations of that commission by appointing a minister responsible for the status of women and the elimination of discrimination as well as promoting equal opportunities for women in all areas of Canadian activity. And I could continue, Mr. Speaker, by mentioning that in 1973 an advisory council of 30 members was appointed to represent all Canadian regions. Their aim was again to make the Canadian government aware of issues interesting and concerning women and of

May 8, 1978
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all measures needed to improve their situation within Canadian society. And I might also, Mr. Speaker, mention the creation of a committee and a co-ordination bureau responsible for studying the status of women in Canada. I might suggest that the hon. member discuss the issue he just raised in this House with the various organizations concerned so that a serious study be made about the representations he made tonight.
But with your leave, Mr. Speaker, I wish to describe a situation that occurred this morning concerning improvements that might be made to the Unemployment Insurance Act. It was amended recently and we should continue to improve it. This morning I received a lady who told me about her situation. She is working at home and has worked five years for an employer. As I said before, she did her work at home. She worked for a clothing manufacturer and, after five years, she found herself unemployed, without a job. She asked for unemployment insurance benefits which she got in an amount of $276. Later, on April 4 last, she was asked to reimburse the $276 because her job was considered by Revenue Canada as non insurable; she is therefore asked to reimburse the unemployment insurance she got as a result of her employment.
It seems to me, Mr. Speaker, that if we want to look into the changes that should be brought in unemployment insurance, we should consider the possibility of making work in the home insurable for unemployment insurance purposes. After having discussed the matter with the Department of National Revenue whose representatives mentioned that it was difficult for them to determine how many hours of work the person involved would have put in, it seems to me we should be able to determine easily, through the income tax T-4 slip, the income of those persons who could perform their work at home while taking care of the family and without having to hire a helper to mind the children.
It seems to me that in line with these amendments to the Unemployment Insurance Act and with a view to improving the status of women, working in the home should be considered for a woman who wants to earn a salary, who wants to bring in extra money, as in the case of this woman living on Fridolin Street in Fabreville, who paid UIC premiums for five years but who was told by the unemployment insurance officer that the employer should have informed her that her job was not insurable for UIC purposes. I therefore wholeheartedly agree with the hon. member who introduced this motion which could improve the status of women, but it seems to me that some improvement could also be made in the sense that I indicated, as in the example I just gave.
Could I suggest to the hon. member that the request he just put before the House should be considered by the committee which was set up to study the status of women in all these fields. I would suggest to the hon. member that he ask the advice of the Council on the Status of Women rather than

asking an immediate amendment to the Unemployment Insurance Act.


Mr. Arthur Portelance (Gamelin):: Mr. Speaker, the payment of unemployment insurance to adoptive parents is a matter regularly reviewed by the commission which has been considering that complex and multifaceted problem for about six years. Let us see, for example, how society looks upon adoption. We must point out immediately that the number of children put up for adoption has dropped appreciably in recent years because single mothers are more inclined to keep their child. In short, while the number of children has declined, that of parents who would like to adopt has increased. Today a single parent can adopt a child, something which was unthinkable some ten years ago.
The phenomenon of adoption has also changed. The adoption of older children who often have physical or emotional problems is no longer an unusual occurrence nowadays. Therefore, the needs of those children and their adoptive parents are no longer the same. They also have changed during the past 15 years.
Today most adoptive parents earn an adequate annual income. It is an important criterion in the eyes of adoption agencies. This is why it is good to question the idea of supporting these families financially.
Before deciding on the advisability of giving maternity benefits to the persons who adopt a child, let us recall that the main objective of unemployment insurance is to give temporary support to any person who loses his or her insurable employment. To obtain this temporary help, namely unemployment insurance benefits, the person must look actively for a job, except of course if the work stoppage is due to illness or pregnancy. So, are eligible to this temporary financial help those persons who lose their jobs, who are unable to work or who try to find a job or those who are physically unable to work for a certain period of time.
That is the main objective of unemployment insurance. Does it meet the needs of the adoptive parent? Does the adoption of a child imply automatically that the parent will have to stay out of work? I think the answer is no. Generally speaking, to draw unemployment insurance benefits, one has to be able to work and to be available to this end. An adoptive parent can sometimes meet these two primary requirements. For example, it is possible that the child may need constant care from one of both parents. The parent who goes out of the labour market is, according to the Unemployment Insurance Act, able to work but not available to this end. Furthermore, a mother who has a baby is considered as being physically apt to work. Consequently, if the adoptive parent is not available for work according to the law, he or she cannot draw unemployment insurance benefits. Those two major conditions, that is ability and availability, enable the authorities to determine unequivocally the entitlement of a claimant.
May 8, 1978

The concept of extending benefit eligibility to adoptive parents is to be commended. However, in so doing we would be paying people who have voluntarily left the labour force and who are able to work. Their motives cannot be compared to the physical and uncontrollable reasons that I mentioned earlier. It is certain that adoptive parents may have to stay at home to take care of the new child. However, adoption agencies always explain to the parents the needs of the child to be adopted. Therefore, during the adoption process, the parents are aware that one of them will have to stay at home. Their decision is voluntary.
By paying them benefits, the government would establish a precedent and undermine the basic principles of the unemployment insurance plan. Someone who is physically able but not available to work for reasons other than those which concern the labour force could then receive unemployment insurance. Availability would no longer be a condition of eligibility for those who can explain why they do not meet this condition.
I would like to emphasize that I am not attacking the idea of adoption. Adopting a child is a very laudable social action through which many children can become part of a family. It gives the possibility to many adoptive parents of knowing the joy of raising children. Moreover, this is not a matter of saying whether we are for or against some sort of assistance for adoptive parents. The Unemployment Insurance Act was simply not designed for this purpose.
Some adoptive parents need financial assistance and others do not. In both cases, the decisions to adopt a child and to leave the labour market go together and must be made voluntarily. We must also remember that the main purpose of the unemployment insurance plan is to give temporary assistance to anyone who loses his insurable employment to allow him to find new employment quickly.
Canada's employment picture is not very good. The unemployment insurance program is not a welfare program. It is not designed to cover all social needs. I suggest it would be unwise to grant unemployment insurance benefits to adoptive parents because they must stay home for a given period of time. Since maternity benefits do exist, it is understandable that some would like these benefits also to be paid to adoptive parents. Yet this would contradict the basic principles of this program. Women collect maternity benefits only because they are physically unable to work. Adoptive parents are physically capable of working even though adoption agencies may require that they temporarily give up their employment.
The unemployment insurance program should not become a substitute for other social aid programs. The program is not designed to meet all the income needs of Canadians. I have no doubt that adoptive parents might need some form of financial support. Their problems can even be more complex than those of natural parents. I am, however, opposed to this motion because in my opinion unemployment insurance is not the proper instrument to help them.
Adoption Benefits


Harold Thomas Herbert: Mr. Speaker, it is a pleasure for me to speak on the motion of the hon. member even though I will not be speaking in support of it. The notion of paying unemployment insurance benefits to adoptive parents, in much the same way that benefits are now paid to workers unemployed due to pregnancy, is not new. However, unemployment insurance was designed to provide adequate, short-term income maintenance for workers who, for reasons beyond their control, are unemployed, capable of work and available and actively searching for work, or temporarily physically incapable of work.
Unemployment insurance, then, is for workers who are unemployed for reasons beyond their control. While collecting unemployment insurance, unemployed claimants must actively look for work unless they are physically unable to do so. Adopting a child is a deliberate, conscious decision. The parent of an adopted child, although physically able to work, would not be available and would not be actively looking for a job. To give people in this situation unemployment insurance benefits would be to distort the purpose of the whole unemployment scheme.


J. Michael Forrestall: Balderdash, nonsense. Get that grin off your face.


Harold Thomas Herbert: Fortunately, in this House we are all entitled to our opinion.


J. Michael Forrestall: Get that grin off your face. You do not believe what you are saying either.


Harold Thomas Herbert: As most of us know, in the adoption process the particular needs of the child are outlined ahead of time to the prospective parents. If there is the need for one parent to remain in the home, this is known almost from the beginning.
If the parents work outside the home and decide to adopt a child and this requires one parent to leave the labour force, the adoption becomes a conscious decision that one parent leave the labour force. It becomes a responsibility that the parents assume jointly. The conscious element in the parents' decision to adopt puts the matter outside the principles and the scope of the Unemployment Insurance Act.
If the government were to consider giving unemployment insurance benefits to adopting parents, a precedent would be set that would distort the purpose of unemployment insurance. With this precedent, why not pay benefits to any capable but unavailable insured person whose unemployment was caused by conditions other than the labour market? Using this reasoning process, I can envisage thousands of persons deciding to be unavailable for work for what they, in their own minds, saw as good reason. They would argue that they were entitled to unemployment insurance on the grounds that their decision made them unavailable for work. The implications of this are obvious and too far-reaching. I must emphasize here that the issue before us is not the process of adoption itself. Adoption

May 8, 1978
Adoption Benefits
plays a vital role in our society, providing good homes for children who are disadvantaged or parentless. It gives childless couples the chance to experience the joy of parenthood. The issue at stake is not to decide whether adopting parents should get some form of special aid from the government either. The point in question is whether unemployment insurance is the appropriate vehicle for such assistance. In other words, my concern is not whether adopting parents may need some kind of support. There will be those who will and those who will not. My concern is to retain intact the principles of the unemployment insurance program in this country. These principles have remained essentially the same over the nearly 40 years since the first Unemployment Insurance Act was passed.
Unemployment insurance is not a welfare program. We are all aware that unemployment is a problem in Canada today. But to use the unemployment insurance legislation as a sort of catch-all instrument to cure our social ills, however valid these needs may be, would be unwise.
Because the unemployment insurance program pays maternity benefits, I can understand people assuming that a parallel exists between that and the payment of support to adopting parents. Once it is understood, though, that maternity benefits are paid because of physical incapacity to work, the parallel disappears.
At a time when we are all concerned about unemployment, we must not attempt to force the unemployment insurance program to encompass areas it was not designed to cover. We must not use it as a substitute for other social aid programs. I do not agree with those who see unemployment insurance as the general aid mechanism through which the federal government can solve virtually any legitimate social need of Canadians. Unemployment insurance is a type of social insurance and not the answer to Canadians' income needs, regardless of their nature. If we were to remove the link between unemployment insurance and the labour force and give workers the right voluntarily to remain out of work, we would completely defeat long-established principles.
In discussing the principles of the Unemployment Insurance Act, the words "capability" and "availability" are crucial. Regular unemployment insurance claimants must be both capable of work and available for work. They must also search actively for a job. In the case of claimants on maternity benefits, the person is considered to be incapable of working because of her pregnancy. Maternity claimants do not have to prove that they are available for work because of this incapacity to work. Adopting parents fit into neither category. An adopting parent who has withdrawn from the labour force is physically capable of work, but not available for work.
Under the terms of the Unemployment Insurance Act, then, this parent is not entitled to any benefit. To pay benefit to adoptive parents-laudable though this may seem in principle-would be to pay people who, although capable of work, have made a conscious decision to withdraw from the labour
force. As I stated earlier, this would set a precedent that would erode the very base of unemployment insurance in Canada.
I said earlier that unemployment insurance is not welfare. Insurance spreads financial losses over the large numbers who face the risk. The benefits, paid out when financial loss occurs, are met from a fund made up of premiums paid by contributors. Welfare, on the other hand, is payable on a condition, such as need. Need is a subjective thing and it changes over time. Need cannot be financed using actuarially-determined premiums, as insurance is. This is why welfare benefits are usually financed from general taxation.
Insurance benefits, of course, are financed from pooling premiums. For unemployment insurance, premiums paid by employers and employees are calculated to cover the basic cost of benefits, including administrative cost. This is actuarially sound and meets insurance principles. To attempt to distort an insurance scheme so that it covers both the contingency of unemployment and the element of need inherent in social welfare programs would mean weakening the whole structure of the labour market and its relationship with jobs and people in this country.
Late last summer, this House passed amendments to the Unemployment Insurance Act in Bill C-27. These changes were evidence of the government's continuing desire to respond, within the framework of unemployment insurance principles, to the needs of Canadian workers. May I add at this point that it is my opinion that we should be seriously considering introducing additional amendments to the Unemployment Insurance Act so that persons drawing benefits which are a considerable drain on the economy and who, in my opinion, are not entitled to them should be excluded from those presently listed as unemployed. I refer specifically to persons who would ordinarily be on contract for periods of six, eight or nine months and who now are able to draw unemployment benefits for the remaining months of the year. I speak specifically of classes such as golf professionals and others who up to a certain point in time used to consider themselves fortunate to earn enough income in eight months to last for twelve but who in my opinion are now drawing from the taxpayer moneys to which they should not be entitled.
One of the most significant of the changes made in Bill C-27 was what is called the variable entrance requirement. This amendment made eligibility for unemployment insurance dependent on the rate of unemployment in the region of the country where the claimant ordinarily lives. What this means in practice is that the worker in a region of high unemployment would need fewer weeks of insurable unemployment than the worker in a region of relatively low unemployment. But let me stress here again that this kind of response to conditions in the labour market was done within the framework of the Unemployment Insurance Act and the principles enshrined in it.
While I am on my feet, Mr. Speaker, when the department makes an error, such as it did recently in using a wrong calculation which resulted in an overpayment of $4.3 million to some 15,000 claimants, it is my personal opinion that this is

May 8, 1978

not the fault of the claimants, and under such circumstances the department should accept its responsibility and absorb that loss.


Some hon. Members:: Hear, hear!


Harold Thomas Herbert: I think it would be fair to say that many adopting families have adequate means of income. The Children's Aid Societies are very careful in selecting parents for the adoption process and income is one of the criteria used in their decision. Because of this, many adopting families are in the middle or upper income range.
That is not to say that we should not be thinking of some programs to aid parents who do not have the income to adopt children and who should have the benefit and privilege of children in their home. What 1 am arguing this afternoon is that the unemployment insurance scheme is not the vehicle to be used. That is not to say there may not be a need for some form of financial support for the parents, probably as a provincial area of responsibility, although with our difficulties today perhaps we should not be emphasizing what is provincial and what is federal. But a deliberate decision must be made by adoptive parents, presumably after discussions have taken place with the Children's Aid people on the needs of the child and the parents' ability to provide these needs. So it seems to me that unemployment insurance is not the appropriate place to look for aid in these circumstances.
This is not the first time this House has considered the proposal to pay unemployment insurance to a parent who adopts a child. The issue has been raised on other occasions and the arguments for and against have been aired. Mr. Speaker, I do not want to appear to discredit the adoption process in any way. As I mentioned earlier, adoption does play an important role in finding homes for orphaned and disadvantaged children.
Personally, I think we should take every measure to make it possible for those parents who are in the unfortunate position of not having children of their own to be able to adopt. Adoption plays an important role in finding homes for orphans and disadvantaged children. It gives people who are childless the chance to experience the joys and the rewards of parenthood. The give and take of parent-child relationships is extended through this adoption process and society as a whole benefits. I have no argument against this process. I applaud it most warmly.
Neither do I dispute that adoptive parents may very well need some form of support in their very worth-while endeavours. Indeed, in many ways I believe the role of adoptive parent is often more difficult than that of natural parent. Those parents who decide to contribute so much of themselves in the adoption process are greatly to be admired. But I find myself unable to support this motion to pay unemployment insurance benefits to adoptive parents because I firmly believe the Unemployment Insurance Act is not the right place to provide this kind of assistance. There must be other places to look for help of this kind, not tied firmly to existing insurance principles and not strictly based on capability to work.
Adoption Benefits
I am most pleased that the hon. member has brought forward this motion for discussion. Maybe as a result of our discussions this afternoon some other way will be found to provide the assistance which is requested in the hon. member's motion.


Stanley Howard Knowles: Mr. Speaker, I was not going to speak to this motion today because I had hoped it might get passed and I did not want to contribute to the so-called talking-out process. However, that process seems to be in full flight, so I may as well say a few words.
I am prompted to do so mainly by the remarks of the last two speakers. It is rather interesting to note today that the only speech we have had on this motion from the Conservatives was a Liberal speech, and the last two speeches from the Liberal side have been Tory speeches. I suppose at election time things like that can happen. My hon. friend who just took his seat and the member who preceded him both spoke as though unemployment insurance is based on some basic principle that has never been tampered with or breached at all. I can say that when the program started the idea was that unemployment insurance was to be paid only in cases where there was no work and only to persons who were available for that work.
In the early years when we argued that it should be paid to people who were not at work because they were ill, we were told that would violate the basic principle of the Unemployment Insurance Act. After a while the principle was modified slightly and the law changed so that if a person was collecting unemployment insurance because there was no work and then took sick afterwards, his unemployment insurance benefits were continued. Then after a period of time we said that if we paid unemployment insurance to certain persons who were sick, why not to those who had to leave their work because they were sick, and finally that category was added. Of course, for a long time it was argued that we could not bend the provisions for persons who needed unemployment insurance because of maternity, but we eventually breached that and decided that that too was a legitimate reason for being away from work.
My hon. friend who has just taken his seat, the hon. member for Vaudreuil (Mr. Herbert), suggests that if we go a step further and allow unemployment insurance benefits to be paid to adoptive parents, we will be opening the way to anyone who says "I am not available, I want to go on a holiday" or to someone to say "I want to write a thesis". I suggest this whole matter is under our control.
There is a relationship between the process of adopting children and the process of having children. Most of us in this place do not know what it is like to bear children, but there are a few who can tell us about the experience. It seems to me there are times when natural mothers can work almost up to the time of childbirth and then are able to go back to work right after. I have known of other cases of parents adopting children who have gone through such an emotional experience

May 8, 1978
Adoption Benefits
that they needed to stay home. So I suggest this attempt to draw a hard and fast line really does not match the situation, and it certainly does not match the fine sentiments about our being a society that ought to encourage home building through the adopting process. So, Mr. Speaker, the arguments I have listened to do not carry any weight with me. I should still like to see this motion passed.
Incidentally, my hon. friend from Vaudreuil said that he should like to see something done to encourage the adoption of children but he does not want to see it done through the unemployment insurance route. Even if we passed this motion, it would not legislate anything. It would just express the opinion that something ought to be done for adoptive parents. True, it suggests it might be done through unemployment insurance, but it would give the government a lead to do some thinking about this issue. I hope that we will not have to listen to much more of the kind of argument we have had from the last two speakers. I see another Liberal getting up. I hope that like the hon. member for Davenport (Mr. Caccia) his speech will be a Liberal one, instead of a Tory speech such as we have had from the last two Liberal speakers.
I support the motion, Mr. Speaker.


Mr. B. Keith Penner (Thunder Bay):: Mr. Speaker, the hon. member for Winnipeg North Centre (Mr. Knowles) uses the term "a Liberal speech" and "a Tory speech". He does not bother to define at any great length exactly what categorizes these particular kinds of speeches.
In opposing the point of view expressed by the hon. member for Vaudreuil (Mr. Herbert), it seems to me he is taking a restrictive and confined point of view concerning the unemployment insurance program. In my opinion, the hon. member for Vaudreuil was quite correct in saying that we are in fact opening the door to a great many social problems in this country that require solution. There are a great many social situations where financial aid is needed. The question is: Should we open the door in such a way that the unemployment insurance program becomes a catch-all for every social program that presents itself to this House?
Like the hon. member for Vaudreuil, I think the issue before the House is not whether some adoptive parents require financial support but whether the unemployment insurance program is the proper program to provide it. We know that there are a great many social programs in existence at the federal and provincial levels. If hon. members in this House detect a significant gap and a need in our present complex and widespread social assistance program, it should be remedied. For example, if there are adoptive parents-I am sure the hon. member for Winnipeg North Centre would agree with me entirely-who are not financially able to be adoptive parents, but who do meet the other requirements of providing the stability, the emotional and psychological environment to take adoptive children into their home, then they should not be precluded from becoming adoptive parents. If hon. members in this House detect that there is a glaring gap in this program and that it must be addressed, then let us address ourselves to this problem and solve it. But if we say that we detect a need

and that the obvious answer to it is through the unemployment insurance program, then we are saying that next week or the week after when another need is detected we can open the door again. By doing that we would not have an unemployment insurance program at all; we would have a new, all-encompassing, comprehensive social assistance program.
I know that when the hon. member for Winnipeg North Centre sat in the committee-


Stanley Howard Knowles: Another Tory speech.


The Acting Speaker (Mr. Ethier):: Order, please. I regret to interrupt the hon. member. It being six o'clock the hour provided for the consideration of private members' business has now expired. I do now leave the chair until eight o'clock.
At six o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.


[Stage Direction]
The House resumed consideration of the motion of Mr. Goyer that Bill C-39, to amend the Currency and Exchange Act, be read the third time and do pass.
The Acting Speaker (Mr. Turner):: At five o'clock the hon. member for Vancouver Quadra (Mr. Clarke) had the floor. He has 22 minutes remaining.


William Hillary (Bill) Clarke: Mr. Speaker, as it came up to five o'clock, I was explaining the severe reservations that we on this side have concerning this bill. Primarily, the bill will remove the power from parliament and give it to the governor in council to make rulings as far as the gold coinage of Canada is concerned. Also, I spoke about the lack of planning the government have shown in introducing a bill of this sort when the concept of what it is they plan to do has not been spelled out.
Just before five o'clock I had reached the point where I was talking about the production of jobs, what the program was going to do and how the mining industry representative had said to the committee that at the moment the industry cannot sell enough of its production at a price that enables it to make a profit. They want the price of gold to be determined in world
May 8, 1978

markets. This program will provide additional demand. They expect this demand will lead to an orderly upward movement in the price of gold. He stressed the word "orderly".
The problem is that the government has not given any commitment to the production of the bullion coin, simply to the production of the medallion. It has been adequately demonstrated that the medallion will not have any particular value from the point of view of the mining industry. The demand for a medallion will be rather poor. There are a couple of very good reasons for that.
I want to illustrate before going on that the Minister of Finance (Mr. Chretien) had some very severe reservations concerning the production of a gold coin for sale as a piece of gold. In a letter written by the Minister of Finance in December 1977 referring to the proposal for a gold bullion coin, he said:
First of all, it would seem to me that the term "coin" should not be used in this instance.
The production and sale of tokens whose selling price would be related to the commodity value of gold would be acceptable, he said. He then said:
We would want to ensure that the tokens were not marketed with any implied guarantees by the government as to future value.
Of course, this is why the gold coin idea will sell, because it has a stop loss value of $100 Canadian, if that is the amount decided on by the government. The minister went on in his letter:
We would want it clearly understood by potential buyers that these tokens were not legal tender and had no monetary value.
Of course, there has been a grave danger since then because they would have a monetary value. They would be put out by the government through the Mint.
The minister summarized his views by saying:
-while I have no objection to a private manufacturer producing and marketing gold tokens, I would not wish to see these described as "gold bullion coins" which might have an implied monetary value or guarantee on the part of the government.
We can see that the government has made many changes in planning and that the planning has many deficiencies. Parliament is being asked, in approving this bill, to countenance aiding and abetting those who would like to move their investments in gold across international borders without attracting duty. I mentioned this afternoon that the rate of duty in the United States would be 17.5 per cent in the case of somewhat similar products. I raised this matter in committee on April 27. The Master of the Mint had admitted that the value of the coins bore no relation to the face value. The value of the gold was what counted, just as the value of the medallion would fluctuate with the price of gold. But if the government of Canada lends its name, investors are able to buy them with a stop loss value and thereby circumvent duties imposed by other countries on valuables moved across their borders.
I refer again to the minutes of the committee for April 27. A question was raised on that occasion having to do with sales
Currency and Exchange Act
tax on coins issued by the government. If one takes ten $20 bills to a bank and exchanges them for two $100 bills there is, of course, no imposition of sales tax. The idea of a sales tax imposed on the exchange of one combination of notes for another is ridiculous, I would be the first to agree. But the government allows provincial governments to levy provincial sales tax on legal tender. I am referring specifically to other coins produced by the Mint. In the committee I expressed the point as follows:
What concerns me is the matter of sales tax on these coins within Canada at the moment, particularly the gold coins commemorating the Silver Jubilee of Queen Elizabeth II. When one goes into a bank and buys a $50 bill or a $100 bill there is no suggestion that sales tax is payable and there is no question that $100 Silver Jubilee coins are legal tender; yet, when one buys them, particularly in British Columbia, one must pay the 7 per cent provincial tax. Of course, the defence given is that, to use the minister's words:
... the determination of what goods are subject to provincial sales tax is the responsibility of the provincial governments.
I was quoting from the minister's letter to me. To continue the quotation:
The minister presumes that
... the provinces imposing tax are doing so on the basis that these items are considered to be commodities when traded and not legal tender. As to why such a levy should be allowed, I can only state that to date the courts have not found that the provinces cannot impose these levies.
I would ask hon. members to compare this situation, in which the federal government accepts the position of provincial sales tax on Canadian legal tender, with the provision in the budget established some four weeks ago on April 10 when the cabinet found it was not too difficult to get all the ministers of finance of the provinces, or at least the overwhelming majority of them, to agree that concerted action be taken at Ottawa's behest. The result, as we know, is that provincial sales taxes were reduced.
In summary, we have many things to complain about in this bill and not very much to agree with. We support the intention to provide jobs in the mining industry and in certain areas outside, including the Mint. But the measure has implications which go beyond this. There is the aspect involving the further erosion of parliamentary powers-the emasculation of this institution. Then again, by voting for this bill, we would be aiding and abetting people who want to move gold across international borders duty-free. All this, together with the general lack of planning and the fact that the government has refused to commit itself to going ahead with the bullion program, is not good enough. I hope the minister and his colleagues will reconsider their approach before the question comes to the final vote.


Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, this little bill involving the minting of commemorative coins, tokens and so on is not one of great importance, in my opinion, and we might be better occupied dealing with some of the tax bills flowing from the recent budget. But it does give rise to certain difficulties. The government itself does not seem very clear as to its objectives.
The government would like authority to mint coins of a commemorative nature, for example, coins marking the 25th

May 8, 1978
Currency and Exchange Act
anniversary of the Coronation or the holding of the Olympic Games. Such coins would be limited in face value but the face value would be much greater than the gold in the coin is worth. The minister has informed us that the governors of the Mint have suggested a unity theme for one proposed issue. In my view this is a stupid proposal. Other speakers in this debate have pointed out that presumably the country is unified already and that the issuance of a gold coin is not likely to appeal to many as being a very practical manifestation of unity.
As things are, parliament is the sole body, as I understand it, which can authorize the minting of coins for a particular purpose such as the commemoration of the Olympics. I am inclined to think that this authority should remain with parliament. It would seem as though the government really intends to run a type of lottery, and I would place many of these proposed coins in that category.
By minting coins such as this we are, in essence, competing with private mints, and I am not sure that that is the right thing to do. I believe that parliament should retain the authority to authorize a commemorative gold coin, but only under certain circumstances. This should not be given up to the whims of the cabinet, and especially not the present minister. The problem of unity is ongoing and will certainly not be solved by minting such a coin. I am more interested in a gold bullion coin. The mining industry has pushed the idea of a concept based on the South African Kruger rand, which is a coin bought at the price of gold of the day plus a small amount for minting and distribution. It is somewhat of an anomaly that nations around the world are getting rid of gold as a monetizing agent-in other words, attempting to demonetize gold and remove it as a standard. Gold has been a standard, I suppose, for 5,000 years or more, and gold has retained its value.
While governments may be demonetizing gold, people are turning to gold as a hedge against inflation. While governments tend to rely on the International Monetary Fund, individuals are buying gold to deal with inflation. It is interesting that at the present time the United States has something like S55 billion in gold based on $180 an ounce, or $270 million in troy ounces. However, much of it is impure. It is called coin melt and has a gold content of only about 90 per cent. West Germany has about $50 billion worth of gold at present day prices, France, $17 billion and Switzerland and Italy, $14 billion, while Canada and Britain each have only about $3.6 billion. It interesting to note that the most desired currency in the world is the Swiss franc, which is, relatively, the most heavily gold-backed currency in the world.
Incidentally, it has been suggested that the gold reserves of the central banks of the leading countries now amount to nearly $180 billion at present day market prices. It is an important reserve because it exceeds SDER's on special drawing rights from the International Monetary Fund by some 1,800 per cent. So although on the one hand governments talk

about demonetizing gold, on the other hand gold is now one of the biggest reserves in banks throughout the world.
Many people are now interested in acquiring gold in the form of coins such as the Kruger rand. It is interesting that in their testimony outside experts quoted the fact that the only refugees from Viet Nam who were able to bring in valuables were those who had gold in some form or another. So it is a form of savings. It is something we can carry with us. It has been used over the centuries as a valuable commodity which can be moved.
It seems to me that with the inflation we have gold has value. It had a value in the past, even 5,000 years ago, and it continues to have a value. Even if governments do not wish to accumulate gold any more and wish to demonetize it, the mere fact that our citizens want to accumulate it makes the minting of a gold bullion coin very practical. I mentioned that the Swiss franc, which is, relatively speaking, the largest gold-backed currency for a small country, is in demand, and it seems to me practical that citizens should hold gold in coins, bullion coins or in some other form. That would be endorsed by the public, and would, in the long run, strengthen and stabilize our credit and financial institutions. The present monetary system is based on paper and confidence in it. At this time it shows serious signs of erosion. There are violent currency fluctuations.
All over the world people in many countries are buying Kruger rands. It is interesting that in January of 1978 some
700,000	units of Kruger rands were sold. That represents something like 700,000 ounces. In February some 600,000 were sold. The financial pages are full of articles indicating that gold is increasing in popularity. People are buying gold shares, gold bullion or gold stocks. If a Canadian bullion coin was available, Canadians would likely buy a few. In addition, markets in the United States and West Germany would be prime for gold bullion coins.
It has been suggested that the coins should be half-ounce or one ounce. Some studies have indicated that international markets would probably absorb one million one-ounce gold coins a year. That would still only amount to one and one-half month's Kruger rand sales. However, it would contribute to the international currency market. An increasing number of investors of very modest means are placing some of their assets in gold as an ultimate hedge against any drastic altering of existing relationships among major currencies. Indeed, some economists are suggesting that gold is one of the best holdings with which to provide a hedge against severe inflation. Some have suggested that perhaps one quarter of one's assets should be held personally in the form of gold, so it does not seem as though there is any disadvantage to minting a gold bullion coin.
However, unfortunately the government has not seen fit to say whether it is in favour of a gold bullion coin. There was talk about that in committee, but we did not hear the government say that it expected to mint one. I think that a gold bullion coin would meet with general approval and would be a major thrust in creating stability in the industry. It would
May 8, 1978

provide more jobs. In the 1930's gold mines produced income and jobs for a relatively large number of miners when other mines were at a low ebb. As I understand it, gold mines are relatively labour intensive, so more jobs are created by a given amount of capital investment in gold mines than in other types of mines.
We in Canada are encouraged to export more, but we often export goods which are not very competitive. We have heard about our exports in manufactured goods. We have heard that the Export Development Corporation has to underwrite some 42 per cent of capital goods exported from Canada to destinations other than on the North American continent. If we were to export gold bullion coins, job creation would be accelerated because of increased mining activity. By exporting coins we would be exporting finished products. That would fulfil the wishes of those who suggest that raw products should be upgraded before being exported.
It has been suggested that as we are the third largest gold producing nation in the world we would not need to be financed by the Export Development Corporation because there is a solid market for gold coins. If the market holds up to what has been projected in studies, it would indicate that all our present day gold production would be used up, and presumably we would bring into play substantial amounts from other mines. The Mint would benefit from the minting of the bullion coins and should return a modest profit.
It seems to me that it is much more desirable to mint a gold bullion coin, which people wish to have as a hedge against inflation, even if governments do not always agree as to its value, than to run what I consider to be a kind of lottery on commemorative coins. Many people, including myself, believe that a $100 gold piece contains $100 worth of gold, but in reality it does not. The value of gold would have to be inflated many times over before it reached the face value of the coin, as we realized when we studied this bill.
In conclusion, I certainly support the minting of a bullion coin, but I am most unhappy at the fact that the government seems to prefer minting a token unity coin in attempting to supply the market when a bullion coin would go a long way toward providing incentives to our gold mining industry, resulting in over-all stability for our miners. I believe that the United States and West Germany would provide markets for the minted bullion coin and that individuals in the western world who wished to buy gold as a hedge against inflation would also be interested in buying the minted coin.
In view of the fact that the government has not been clear with regard to what it wishes to do in this situation, I move, seconded by the hon. member for Grenville-Carleton (Mr. Baker):
That Bill C-39, to amend the Currency and Exchange Act, be not now read a third time, but that it be referred back to the Standing Committee on Finance, Trade and Economic Affairs for the purpose of reconsidering the method of authorizing the issuance of gold coins and in particular gold bullion coins.
Currency and Exchange Act


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


The Acting Speaker (Mr. Turner):: All those in favour of the amendment will please say yea.


Some hon. Members:: Yea.


The Acting Speaker (Mr. Turner):: All those opposed will please say nay.


Some hon. Members:: Nay.


The Acting Speaker (Mr. Turner):: In my opinion the nays have it.
And more than five members having risen:


The Acting Speaker (Mr. Turner):: Call in the members.


Mr. Speaker:: I therefore declare the amendment lost.
The question is upon the main motion. Is it the pleasure of the House to adopt the motion?


Some hon. Members:: Agreed.


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


RAILWAY ACT
[Stage Direction]
The House resumed, from Friday, May 5, consideration of the motion of Mr. Abbott (for Mr. Lang) that Bill C-17, to amend the Canadian National Railways Capital Revision Act and the Railway Act and to amend and repeal certain other statutes in consequence thereof, be read the third time and do pass, and of the amendment (Mr. Murta) (p. 5176).
Donald Frank Mazankowski: Mr. Speaker, I rise to speak in support of the amendment advanced by my colleague, the hon. member for Lisgar (Mr. Murta).


The Acting Speaker (Mr. Turner):: Order, please. The hon. member for Vegreville (Mr. Mazankowski) has the floor. If hon. members want to have conversations, I suggest they have them behind the curtains.


Some hon. Members:: Hear, hear!


Donald Frank Mazankowski: Thank you, Mr. Speaker. This bill has undergone considerable debate both in the House and in committee. The evidence presented and the information elicited during the committee proceedings has caused members on this side of the House very genuine concern.


Mr. Benjamin:: Some members.


Donald Frank Mazankowski: I hear the hon. member for Regina-Lake Centre (Mr. Benjamin) say "Some members". Had he been at all of the committee hearings, he would have followed the bill in a much more effective fashion and would understand it better than he obviously does. We call that kind of member a hit and miss member. He was missing more times than he was hitting. The hon. member tried to jump on the bandwagon of the members of the Conservative party who had worked very diligently trying to bring about an improved bill. He came along at the eleventh hour and bootlegged in an amendment. Now he can go back home to tell his constituents what a great job he does. However, we will probably send out the attendance record, which will not look so good.


An hon. Member:: Get up on a question of privilege.
[The Acting Speaker (Mr. Turner).]


Donald Frank Mazankowski: The hon. member can certainly get up on a question of privilege if he has the guts and credibility to do so.


Some hon. Members:: Hear, hear!


Leslie Gordon Benjamin: Mr. Speaker, I am glad the hon. member for Vegreville (Mr. Mazankowski) has enticed me to get up. It is not a question of guts. It is more a matter of the content of his speech, which he has read three times during the course of second and third reading debates. I remind the hon. member on a point of order or question of privilege, whichever your Honour wishes to choose, that the two or three meetings I missed on the transport committee are no greater than the number he missed.


The Acting Speaker (Mr. Turner):: Order please. I suggest to the hon. member that is not a point of order but a point of debate.


Donald Frank Mazankowski: Mr. Speaker, that is about as phony a point of order as the points the hon. member made in committee, which were very phony. As I was attempting to say before I was so rudely interrupted by the hon. member for Regina-Lake Centre, we have some very genuine concerns about the impact of this bill upon certain sectors of the transportation industry.
I wish to review very briefly the position our party has taken on this bill. At second reading, we allowed the bill to advance to committee stage, at which time we were to call witnesses and study the details of the legislation and the impact it would have on the transportation industry. Implicit in that decision was the condition that various factors would then be taken into consideration, namely the impact this legislation would have upon other modes of transportation. We were concerned about what it would do with regard to distorting the competitive balance of the transportation industry.
Secondly, we were concerned about the provision of adequate safeguards to ensure that the measures of control and accountability of this corporation were enshrined in legislation. As well, we wanted to ensure that the funds which would supposedly be earmarked for improving the transportation system would in fact be earmarked for that purpose.
The third point we wanted to consider was whether this legislation was really needed and whether it would serve the benefit of the public interest.
Fourth, we were interested in examining the impact upon CNR, with recapitalization and without recapitalization, over a projected five-year period.
Having considered all these points, the members of our party concluded that this bill does not appear to be needed at the present time. In our view, it does not provide any degree of significant benefit to the national interest of Canada.
Second, notwithstanding the amendment that was accepted whereby the annual reports of the corporation will be automatically referred to the Standing Committee on Transport and Communications, which is an improvement, in our
May 8, 1978

view this is not sufficient to adequately provide for the kind of control and accountability mechanisms that we seem to be aspiring to put in place with all Crown corporations.
Third, because the CNR have now proven to themselves, their shareholders and the country that they can turn the operations of the corporation into a profit on the basis of the existing financial structure, this implies that the current management team are in fact doing a very good job. The fact that they are turning the corporation around is very commendable. We, and I am sure all members of the House, join in commending the president of CNR, Dr. Robert Bandeen, and his management team on a job very well done. They have demonstrated that with sound management and good business practices the corporation can turn a profit on the basis of the existing financial structure.
It may be argued that the profit is not high enough to meet the cash requirement in terms of maintaining equipment, upgrading roadbeds and so on, but the fact remains there has been a major achievement on the basis of the existing structure. But most serious of all is the concern we have that the CN could disrupt the competitive balance in the transportation industry, particularly one of the major private sectors in the industry, that is to say, the trucking industry, and that the interest of the public would not be served as a result.
We feel strongly about this. The Canadian Trucking Association presented a detailed and comprehensive brief to the committee-


Leslie Gordon Benjamin: And you bought it!


Donald Frank Mazankowski: Mr. Speaker, when the hon. member is out in his constituency he is a great supporter of private enterprise, but back here in the Commons he is a doctrinaire socialist and nothing else. He speaks out of both sides of his mouth. He really does not support the trucking industry at all. He would like to see the whole trucking industry nationalized, as should be very clear from his utterances.
There are other considerations involved here, such as intentions on the part of the government which are not fully known at present, adjustments in the freight rates, the full impact of the removal of passenger service from the CN rail system and other consequences of government policy. For these reasons we believe the bill should not be proceeded with at this time.
Other speakers have dealt in detail with certain of our misgivings; I have myself expressed them in committee and I do not wish to cover the whole ground again. Nevertheless, I shall attempt to outline some of the circumstances which have led me to believe that it would be wise to defer this legislation. Mr. Speaker, we see this bill as an exercise in financial manipulation. When it was introduced, the Prime Minister (Mr. Trudeau) said: Pass it, and it will save the taxpayers $100 million. As a result of the cross-examination which took place in the committee hearings we found out that this statement was utter nonsense. We can only conclude that, like the Prime Minister, the Minister of Finance (Mr. Chretien), who
Railway Act
confirmed it, has become a master in the art of deceit. That statement about saving the taxpayers money is totally inaccurate and untrue. Anyone who cares to read the transcript of evidence will find that such is the case.
The other argument which was put forward concerned depreciation. That argument was almost as phony. If the depreciation had been assessed when we were told it should have been, perhaps at the time of the last recapitalization in 1952-or it could have been calculated on an annual basis thereafter-it would have had the effect of increasing the deficit by some $24 million annually. The CN would have ended up with a debt equity ratio of 1 per cent to 99 per cent, which would have been totally unacceptable.
What did happen was this. Throughout the course of the CN recapitalization of 1952 the net effect was to put the company on a debt equity basis comparable to that of the North American industry. It was at that time of the order of 65 per cent, which was reduced to some 40 per cent as a result of recapitalization. To achieve a debt equity ratio which would be similar to that of the North American industry we have, with the conversion of $808 million worth of debt which was considered unclaimed appreciation in the equity, here again improved the debt equity ratio from 62 per cent to 42 per cent.
The minister said this was required. I cite from page 2621 of Hansard:
However, the result of this long-standing obligation for the company to rely on loans for the bulk of its capital requirements has been a debt ratio of about 62 per cent compared with the rail industry average in North America of approximately 35 per cent, and about 35 per cent for the CPR in particular.
There, again, is a statement which is completely untrue. We found out during the committee hearings that there was no inherited debt to speak of after the 1952 recapitalization, so there really was not any long-standing obligation, as the minister stated. The evidence before the committee confirmed that all the inherited debt had been removed by 1952 and that the CN debt ratio was improved from about 65 per cent to 32 per cent, putting the company on the same basis as its major competitor, the CPR. So the depreciation argument is another argument which amounts to nothing more than hogwash.
What really happened after the 1952 recapitalization was that CN went on a spending spree. It purchased new equipment, bought out many trucking companies and engaged in the acquisition of many allied ventures. Then it found within ten years that it was back in the position it had occupied prior to recapitalization. Mr. Speaker, I am sure there are many private companies which would like to carry on their refinancing on such a basis. I would point out that the trucking industry, which the hon. member over there wants to nationalize, has to finance its requirements out of earnings, not from debt cancellation or the accrual of unused depreciation.
During the committee hearings I was talking about the ability or otherwise of Crown corporations to make a profit. I will mention two major hotels. First, the Macdonald Hotel in Edmonton, in 1973, showed a loss of $.1 million. It broke even in 1974, 1975 and 1976 and then showed a profit of $.1 million in 1977. So over a five-year period it was a break even

May 8, 1978
Railway Act
proposition. I suggest that there probably is not another hotel in the city of Edmonton with that kind of record. The same holds true for the Fort Garry, except it is a little worse: S.l million for 1973, $.1 million for 1974, $.2 million for 1975, $.2 million for 1976 and $.3 million for 1977, all losses. When we look at legislation like this, we are concerned about those kinds of things. Legislation like this really does nothing more than relieve the burden of debt from a Crown corporation which should do better.
I now come to what I refer to as the impact of the unknowns. Things which are taking place, either being enacted at the present time as a result of government policy or being contemplated, I submit will have a very significant impact upon the earning power and the operations of CN. I refer to branch line abandonment. Branch lines are constantly being abandoned, and branch lines will continue to be abandoned over the next 10, 15 or 20 years. This will place a heavier burden on farmers because the result of consolidation in the grain handling system will be more efficiency, and it will be easier for rail lines to move grain from country elevators to ports. However, it will entail much longer hauling distances for the average producer.
We have also talked about the withdrawal of passenger services. That too removes a liability or a deficit operation from the railway, some of which has been taken into consideration in the projected figures. We also have the prospect of an adjustment in the statutory freight rates, which the minister indicates will come about in due course and which will have a major and significant impact upon the earning potential of the CNR. There are fairly hefty grants from the government for railway rehabilitation and for the upgrading of tracks. The minister has indicated the figure of some $600 million going to both railways, the bulk of which will probably go to the CNR. We have budget relief measures which will accelerate depreciation on the purchase of equipment. There will be further purchases of hopper cars and continuing maintenance of a number of articles of rolling stock. Stated government policy provides for the payment of subsidies for the provision of any service which may not be economic, but which is deemed necessary in the public interest. We have the record of the CNR in terms of its improving its efficiency and its rationalization and in terms of cutting down its labour force, thereby improving productivity.
The total impact of these measures has not yet been felt, but I suggest that they will have a very major and significant impact upon the operations of the CNR from a cash generating point of view. The evidence in the committee suggested that taking into account some of these items, but not necessarily all of them, would result in CN's showing a profit of up to $294.2 million by the year 1981. Of course, this raises a couple of questions. First, can CN justify that level of profit? It is a Crown corporation. Second, we have to question what impact that much profit may have upon labour-management relations and particularly the negotiations which would take place between the unions and management. I think those two points

are very important, relevant and germane to this legislation. In addition to those two points the impact upon CN's competitors will, I suggest, be very substantial.
That brings me to the point which I consider to be the most important in this bill, and that is the impact upon other modes of transport, particularly those which are in direct competition with CN. Of course, once again I refer particularly to the trucking industry. I think that the minister and his colleagues have failed to recognize the legitimate concerns of the trucking industry. I think those concerns have been sloughed off. Notwithstanding, the minister has made assurances, and the officials of the CNR have made assurances, that these fears are unfounded. However, unfortunately the words expressed in the committee are not enshrined in the legislation. Therefore, any guarantees which may have been suggested or implied during consideration of this bill in committee are hollow and meaningless.
I believe that the Canadian trucking industry can say with some justification what it said in a statement which I wish to place on the record at this time. This statement was contained in the submission presented to the Standing Committee on Transport and Communications by the Canadian Trucking Association. The Association said this:
CN management should be encouraged to compete in the marketplace on an equitable basis with private enterprise where transporation services can be self-supporting. We do not believe this can happen where the Crown-owned railway is given an overwhelming financial advantage. To be more specific, we are concerned that given enough financial leeway, CN management will again be tempted to try and buy their way into a self-contained empire of inter-connecting services where they would otherwise have to compete with other carriers for much of the interline business they would control. CN might decide that with one final cast of the dice they could revolutionize domestic transportation on a multi-modal basis and in the process effectively bury the competition.
The Association made the following concluding statement:
A condition precedent to passage of C-17 should be some kind of guarantee to parliament that CN will refrain from indulging in massive new investment schemes in an attempt to corner profitable domestic transportation markets while neglecting its responsibility to maintain, if not upgrade, services in those regions of the country where CN may be the dominant transportation undertaking and where return on investment is less attractive. Present procedures obviously aren't adequate.
I think those concerns are very fundamental and should be considered very seriously, because fundamental to sustaining an efficient and effective transportation system, the concept of equal treatment for all modes of transport by the government must certainly prevail. In this case I see this legislation discriminating against the trucking industry and, for that matter, the CPR.
I come to my final point. It is touched on in that final passage which I quoted, and it has to do with control and accountability and the assurance that the CNR will not be back to this parliament in 20 years for another recapitalization or another debt cancellation.


Leslie Gordon Benjamin: It will be if you are running it.


Donald Frank Mazankowski: We do not have that assurance in this legislation. We tried to build in that kind of mechanism. We tried to have the Auditor General appear before the committee
May 8, 1978

to give us his advice and wisdom. The loudmouth from Regi-na-Lake Centre was not at the committee at that time, so he really would not know what I am talking about.


Leslie Gordon Benjamin: I was so. I voted for your motion, you idiot.


The Acting Speaker (Mr. Turner):: I suggest to the hon. member he should watch his language, and I also suggest that he withdraw the remark.


Donald Frank Mazankowski: He may have been there in body, but he certainly was not there in spirit.


Leslie Gordon Benjamin: I voted for your motion, you dummy.


Donald Frank Mazankowski: He certainly was not there in spirit. In committee we attempted to improve the legislation so as to ensure that the mechanism which we provide for a greater degree of control and accountability to the House, and thereby to the shareholders of this major Crown corporation, is put into place; and in that connection we attempted to have the Auditor General appear before the committee. We felt that he would have been the expert on this matter, given the fact that he had undertaken a major comprehensive study of the financial management and control of Crown corporations and that he had advanced some very thoughtful suggestions. Unfortunately, members of the Liberal government were not prepared to explore ways and means of improving the legislation and they voted our motion down.
We hear that the government is proposing new Crown corporation legislation. We know there is a royal commission to study the financial management control and accountability of Crown corporations. Perhaps that is all the more reason why we should not be fooling around with this legislation at this time, writing off an $808 million debt without providing as a balance an adequate control mechanism. It is with a great deal of concern that we express our belief that this bill is not complete in terms of providing an adequate check and balance of one of the largest Crown corporations in Canada.
I must remind you, Mr. Speaker, that this is a very large corporation which has some 50 consolidated companies in addition to CNR, plus 20 companies which are jointly operated with other entities. Had we been able to look at this piece of legislation with a view to improving it, it could very well have become the example for other Crown corporations to follow. At least there should have been a sincere attempt to explore every conceivable avenue, and we thought the Auditor General would certainly have been the right person to have come before the committee. We felt we would then have been in a position to advance some thoughtful suggestions and proposals which could have been incorporated into the legislation.
I think we should ask ourselves this question: will we have a better national railway as a result of this piece of legislation? Will the corporation be able to discharge its mandate in a more effective fashion? Will it be much more efficient? Will we have a railway which will cut down the car cycle? When I
Railway Act
speak about car cycle I am referring to the movement of grain. Until now it has been 23 days from the elevator to the port. I need not remind hon. members about the problems we have had with moving grain, about the ships waiting in the harbour and the grain piling up on the prairies. Yesterday I had a call from a point where six box cars had been waiting for the last six and a half months. Surely that is no way to run a national railway.
There was no commitment that the passage of this bill would give us a better railway and a better service. We have had no assurance that there will not be more towers, more shopping centres and more investments in other allied and collateral ventures. The president of CNR indicated that he was committed to making CNR the finest railway in North America. He said he was committed to improving the over-all efficiency and effectiveness of the corporation. But again those words are not carved in the legislation before us; they are only recorded in the committee proceedings. We must look at this legislation on the basis of how it will stand the test of time. Judging from the evidence that we have elicited, we can only come to the conclusion that there is no reason why we should proceed with this bill at present because of the various unknown factors and points which I have outlined here. We believe there is absolute justification for postponing and deferring this bill, and for that reason 1 support the amendment which has been advanced by the hon. member for Lisgar.


J. Michael Forrestall: Mr. Speaker, in the remaining one or two minutes this evening I want to re-emphasize one or two of the points made by my colleague, the hon. member for Vegreville (Mr. Mazankowski). A little later in the adjournment debate I will deal with one or two specifics, which I will take up at greater length tomorrow.
Before calling it ten o'clock I should like to indicate to hon. members opposite the disappointment of those of us on this side of the House as well as of the whole of Canada that neither the Minister of Transport (Mr. Lang) nor his parliamentary secretary are present in the chamber this evening. I find this to be a measure of contempt for the House, which characterizes the attitude-


Jack Sydney George (Bud) Cullen: Mr. Speaker, I rise on a point of order. It is hardly fair for the hon. member to make the comment he just made. The minister was very concerned that this bill should be passed tonight. He was hoping it would be passed and made a specific request that I be here to follow the debate, in the hope the bill would be passed. He has a concern about this bill. The hon. member of all people should know that there are times when members of parliament have responsibilities in other parts of the country.


J. Michael Forrestall: I accept that chastisement, if that is what it is, from the distinguished member who is here representing the Minister of Transport. Notwithstanding that, if this bill is so damn important, where the hell is the minister? What is he doing in the dying days of this parliament? My point is this: such an attitude as characterized by the absence of the Minis-

May 8, 1978
Adjournment Debate
ter of Transport tonight epitomizes the attitude the government has taken toward transport in this country in the last couple of years.
May I call it ten o'clock, Mr. Speaker?



PROCEEDINGS ON ADJOURNMENT MOTION

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

Sinclair McKnight Stevens: Mr. Speaker, the question which is under debate this evening was one asked by myself of the Minister of Finance (Mr. Chretien) on April 21. My question was twofold. I asked the minister to indicate what was the estimated level of unemployment that had been used by his department in the April 10 budget which was tabled in the House; and secondly, what did he anticipate the real growth in the economy will be in the current year. Unfortunately the Minister of Finance indicated that it had not been the government's custom to indicate unemployment levels, and in effect he fudged that issue. So far as real growth is concerned, he stated that it would be approximately 5 per cent, which is slightly down from the earlier figures the minister had indicated for real growth.
I think it is particularly important when we are considering the economic plight of Canada that the government be pressed to indicate what they see in the coming years in terms of unemployment, real growth, inflation and the other standard indices. We cannot operate in a vacuum. Certainly to judge from past years, it is alarming to see the dramatic increases which occurred in Canada respecting unemployment. As far as numbers are concerned, unemployment has approximately tripled compared to the level in 1968. Inflation has more than doubled since 1968. Real growth has gone down. Government spending has soared. It is not enough for a budget to be introduced; it would also be helpful if the government would indicate what it sees for the unemployment level this year and in coming years.
The government has been inclined to rationalize its sad performance. It likes to pull various pictures out of the air to convince the public that it is doing a little better than most of us believe. For example, it is customary for the government to talk in terms of creation of jobs in Canada. It uses that as an excuse to justify the relatively high unemployment level in the country. In short, the government likes to say that it is not so much the fact that jobs have not been created as that the
[Mr. Forrestall.l
participation rate has been rising. Also it indicates that unemployment levels are higher than anticipated, and it is difficult to identify what unemployment levels will be in the coming months or years. That is not true.
If one takes a look at the past 30 months in Canada, it is startling to see since controls were imposed on our economy in October 1975 that inflation has gone up a full 4 per cent faster than in the United States. I compare our percentage to that in the United States because that country is our main trading partner and has no controls. On the other hand, real growth has been 4 per cent faster in the United States than in Canada. But most significantly, employment growth has been virtually nil in Canada, compared to 7 per cent in the United States. If Canada had had even half the rate of growth in the past 30 months of that in the United States, our unemployment levels would be down to the 5 per cent range. That is what we are talking about tonight. If the government are not anticipating unemployment at those levels, they owe the House and Canadians an explanation.
If we take a look at the past record, we find unemployment in Canada has risen from 5.3 per cent in 1974, to 6.9 per cent in 1975, to 7.1 per cent in 1976 and to 8.1 per cent on the average in 1977. The figure for 1977 indicates that there are
862,000	Canadians out of work. If that trend continues, it is startling to realize that by 1981 there will be 1,280,000 Canadians out of work and our unemployment level will be 10.6 per cent.
Dealing with real economic growth, on average the real economic growth has been 3.06 per cent since 1973. If that trend continues, it will mean the loss of a full three years of real growth by 1981. That will be tough to catch up with. Surely the government must indicate in more concrete terms where it is going. For example, in the "Economic Review" of April 1978, which was tabled approximately a week ago, at page 88 it is indicated that on a cyclically adjusted basis our deficit will be $4.4 billion in 1977 if various things are taken into account.
At committee we asked the minister what level of unemployment would have given the $4.4 billion deficit figure that they referred to. I was startled to find that they said 6.2 per cent unemployment would still leave a $4.4 billion deficit in this country. Clearly the government is holding back facts concerning our economy at the present time. Private forecasters, for example-


The Acting Speaker (Mr. Turner):: Order. I regret to inform the hon. member that his allotted time has expired.


Mr. Ed Luniley (Parliamentary Secretary to Minister of Finance):: I want to thank the hon. member for York-Simcoe (Mr. Stevens) for asking this question in the adjournment debate because it gives me an opportunity to expand on the minister's answer which he gave on April 21. I am sure the hon. member will agree there was a great deal of confusion and misunderstanding generated by the perhaps less than clear
May 8, 1978

report of the most recent Conference Board numbers. It seems that the hon. member was one of many who have been captured by this confusion.
First of all, and most importantly, the Conference Board has not revised down its 4.5 per cent forecast for real growth as measured by the increase in real gross national product. Moreover, this 4.5 per cent forecast does not include the effects of the budget which everyone agrees will give a significant boost to real growth this year, nor does it include the Quebec budget which is also stimulative.
The 3.9 per cent figure referred to by the hon. member relates to the increase in real domestic product, not to g.n.p. What has happened is that the rates of increase for two quite different measures of output have been taken from the same forecast and reported as the same number. This confusion arose partly because the Conference Board released its national forecast, from which the 4.5 per cent g.n.p. number was taken, a few weeks before its provincial forecasts, from which the 3.9 per cent RDP number was taken. But the provincial forecasts in aggregate are consistent with the national forecast of 4.5 per cent real growth in g.n.p. It is my understanding that the Conference Board itself is quite concerned that this confusion has arisen. In fact, the Board is actively considering releasing the national forecast and the provincial detail simultaneously in the future precisely so that this mix-up will not arise again.
Secondly, the aggregation of unemployment rates from the Conference Board's provincial forecasts shows a national rate of 8.5 per cent compared to a rate of 8.4 per cent in their national forecast. The reason for this is again one of timing. The Conference Board's national forecast was prepared before the March labour force data was available while their provincial forecasts included this information. Despite very strong employment growth in that month, the unemployment rate rose as the participation rate increased by more than anyone had thought likely, the Conference Board included. The inclusion of the unexpectedly high March figure had the effect of raising the annual average marginally. Thus, there has not really been any revision in the forecast of the unemployment rate; rather, new past historical observations have been included in the 1978 base.
On the conceptual side, gross national product measures, as its name suggests, national product; that is, the boundary of production is drawn to include all of the production of Canadian factors of production irrespective of what country the production originates in. With the real domestic product, on the other hand, the boundaries of production are confined to the geographic boundaries of Canada, irrespective of whether the factors of production are Canadian or non-resident.


The Acting Speaker (Mr. Turner):: Order, please. I regret to interrupt the hon. parliamentary secretary but his allotted time has expired.
Adjournment Debate


TRANSPORT-HALIFAX-GOVERNMENT ACTION TO REDUCE RATE FOR CONTAINERS
J. Michael Forrestall: Mr. Speaker, the temptation, of course, is to continue where I left off at ten o'clock, but I will do that when the debate resumes tomorrow, as I hope it will, with respect to the CNR finances.
My question this evening involves Canadian National Railways and its rate structures out of Halifax. Almost three months ago now, I made inquiries of the minister with respect to the 115 per cent increase in container rates out of and through-I am sorry, it is not you responding this evening?


Edward C. Lumley: Yes. I am sorry.


J. Michael Forrestall: Of course, come back when you are ready.
The question of the 115 per cent increase in the cost of moving containers from the port of Halifax to the port of Montreal was raised in the face of a clear indication from the Minister of Transport (Mr. Lang) that the rate would be raised again early in June. Subsequently, we had an indication from Canadian National that it might not be necessary to increase by 6 or 8 per cent the cost of moving containers from the port of Halifax. Now we have every indication that the CNR is backing away from that and once again there is likely to be an increase on June 1.
My concern is that we have a 115 per cent increase since the base year of 1969-70 against reported increases in costs of some 50 per cent. The usury aspect of this is what bothers me. Notwithstanding the important matters that keep the Minister of Transport out of this chamber, he should be here once in a while to respond to the concerns expressed by some of the ports outside the St. Lawrence River area.
We are on the brink of being priced out of the North American container business by a government which permits a 115 per cent increase in 8 or 9 years and sits still while Canadian National Railways proposes an additional increase on June 1. Dart Container Lines claim that every move in this direction takes us one step closer to moving out of the business and moving Canadian traffic and mid-west United States traffic through a principal Atlantic east coast port, which I suggest in this particular instance could be either the port of Halifax or Saint John, New Brunswick.
It is not good enough, Mr. Speaker. The response from the minister was equivocal, evasive and had nothing to do with whether he had any intention of bringing the influence of his office in government to bear on this crucial problem. I should like to put my question to the parliamentary secretary this evening, who is good enough to be here and to bring us his judgment with respect to these matters.
Have Canadian National's costs from 1969-70 up to today gone up by 115 per cent or 50 per cent? Users of the service are convinced that the cost increase is somewhere in the order of 45 to 50 per cent, yet the company has increased its container rates 115 per cent and are threatening us with a

May 8, 1978
Adjournment Debate
further increase on June 1. That is not fair, Mr. Speaker. We are talking about Canadian National Railways and their attitude toward east coast ports.
I continue to be concerned that Canadian National Railways have invested in Cast Lines, a company which is owned outside Canada and is competing with non-conference line carriers of containers between Europe and North America. They can only do that at the expense of the ports of Halifax and Saint John, and to the advantage of the port of Montreal. Canadian National Railways have a substantial financial investment in Cast Lines.
We have had a 115 per cent increase in rates over the last 8 or 9 years against a 50 per cent increase in costs, and right in the middle of this period Canadian National invested in a foreign-owned company moving containers outside of the nonconference line into North America. The port of Halifax is getting the short end of the stick, Mr. Speaker. I have no bias against any of the ports in eastern Canada but I expect my government to have a bias towards non-positions with respect to the various ports. To remain silent and let the principal Crown corporation, the principal carrier, exercise its right, indeed its might-


The Acting Speaker (Mr. Turner):: Order, please. I regret to inform the hon. member that his allotted time has expired.


Edward C. Lumley: Mr. Speaker, first of all I want to apologize to the hon. member for Darmouth-Halifax East (Mr. Forrestall) for the confusion at the start of the adjournment debate. I have been asked by the Minister of Transport (Mr. Lang) to reply on his behalf. I did not want to interrupt him at the start of my discussion with his colleague, the hon. member for York-Simcoe (Mr. Stevens).
As the hon. member is aware, the government through proposed legislation in the last session, Bill C-33, recommended new freight rate provisions which would lead to more equitable rates and better regulatory procedures. The minister in response to the hon. member's questions invited the opposition to prove their sincerity in wishing to clear up the freight rate inequities by consulting with the government with a view to swiftly passing amendments to the National Transportation Act which would do just that.
The government's proposals to amend the legislation governing railway freight rates are generally intended to promote a greater degree of fairness, both regionally and to shippers, while taking into account the financial need of the Canadian railways. The government envisages that Canadian railways should continue to exercise considerable freedom in establishing freight rates where competitive forces can be expected to protect the public interest. Nevertheless, because of the importance of the railway system to the national economy and the continued existence of some railway monopoly power in certain markets, it is proposed that the maximum and minimum rate provisions of the Railway Act should be strengthened.

New legislation would also address the problem of long-haul/short-haul rate differentials. This proposal is intended to modify an element of railway pricing which has been perceived as an example of unfair discrimination. At the same time, it will permit exceptions where a complete prohibition could place Canadian producers at a competitive disadvantage vis-avis foreign producers.
In his question of February 15, the hon. member called attention to the Halifax gateway study by A. O. Little. With respect to rail freight rates for containers the study indicates that those involving Halifax are quite reasonable relative to equivalent rates charged for container movement by rail in the U.S. Specifically, with respect to the existing container rate from Halifax to Chicago of $510 as opposed to $359 from Montreal to Chicago, this difference is reasonable when the distances for the two movements, 1,600 miles as compared to 800 miles, are considered. Mr. Speaker, rates reflect both distance and the cost of providing the service.
The study findings foresee continued growth in port and related distribution activity for Halifax and are therefore positive in terms of a growing and expanding role for the port of Halifax. Toward this goal, Mr. Speaker, the government of Canada will continue to work with all concerned. I think the hon. member opposite will agree that federal moneys for the construction of $35.6 million container handling facilities at Fairview Cove, Halifax, is just one demonstration of the federal government's commitment to this goal.


POST OFFICE-REMOVAL OF TELEPHONES FROM RURAL POST OFFICES
Mr. Cecil Smith (Churchill):: Mr. Speaker, just prior to April 14 I received a phone call from a constituent in Ashern, Manitoba. I was informed by that constituent that the local post office had just been advised that their telephone was to be removed. I could not believe my ears when I heard that the post office, as part of their restraint program, was going to start removing telephones from rural post offices in Manitoba. That is why on April 14, under Standing Order 43, I brought up a motion which I felt was an urgent and pressing matter asking the post office to stop any further removal of telephones from rural post offices, because the telephone in a rural post office is the lifeline of the community.
At that particular time I thought the Post Office Department may have had the courtesy to advise me that telephones were to be removed from rural post offices in Manitoba. I was anxious to know if this procedure would be done Canada-wide or if it would be strictly confined to the province of Manitoba. I am glad to see the Postmaster General (Mr. Lamontagne) in the House tonight so he can answer this important question. To the rural people of Manitoba and maybe to people right across Canada I think this is certainly a sign that this government does not have much respect for the rural people and for the service which the post office should give them.
May 8, 1978

On May 4, the hon. member for Brandon-Souris (Mr. Dinsdale) asked the Postmaster General why the post office was going back some 100 years to the Thomas Edison and Alexander Graham Bell era. The Postmaster General replied:
Mr. Speaker, I would like to answer this question but it seems quite irrelevant to me since the telephone does not come under the jurisdiction of the Post Office.
I learned something. I thought that would be under the jurisdiction of the post office. I was wondering if the Postmaster General had actually issued the order to remove the telephones.
Just what does the telephone mean to the local community? Let us take a typical rural community in my constituency in Manitoba. The postmaster knows everyone in that area. When someone's seed order, a COD parcel, eyeglasses that have been repaired or senior citizen's parcel arrives, it it only courtesy for the postmaster to telephone and inform that person. In many cases rural people live ten or 15 miles from the post office. The government says we must conserve energy. With the telephone removed from the post office, a person must drive to town to find out if a parcel has arrived. The post office is there to provide a service. When a parcel shipped by bus arrives in a rural community, the manager of the bus depot calls the person to tell him the parcel has arrived. If a parcel arrives by rail, the railway office makes a similar call. I feel we have gone back 100 years in this regard.
About 12 years ago in Manitoba, telephones were installed in grade five and grade four post office so that they could supervise the operations of some five or six smaller post offices in that region. Grade four post offices were generally in the immediate area of a grade five. The grade five postmaster was the supervisor of that area. He could make telephone calls regarding regulations and generally advise people of what was going on in the post office. It was toll free at that level.
The supervisoryship has been done away with. Some of the smaller post offices still telephone as a service regarding regulations and the availability of forms which post offices keep for the general public. Nowadays there is the steady telephone trade that has been created by the use of postal codes.
It appears that the decision to remove the telephones in Manitoba was made by one of the supervisors in Winnipeg. I understand his name is Mr. Gardner of the Winnipeg district office. While it may not be looked on as a cost-saving device, I understand it is a way of getting a little more money at the district level.
Most of the mail in the rural areas is now trucked from the major centres. There is always the chance that the truck driver may have trouble on the road, and he can call the postmaster and say that he will be four hours late. The postmaster will then not call in the extra help required for sorting mail.
I feel we have gone backward instead of forward. I would like to know exactly what security the Postmaster General is now giving the mail. The Queen's mail must have top priority as far as security is concerned.
Adjournment Debate
What will happen in the rural post office if there is a fire? What can the postmaster do? He cannot telephone the local fire department. That is why on May 4 I asked the Postmaster-General whether he had requisitioned hand bells. The postmaster could then run up and down the street, ringing his hand bell, shouting "Fire, fire". That is what was done before the telephone was invented.


The Acting Speaker (Mr. Turner):: Order, please. I regret to inform the hon. member that his time has expired.


J. Gilles Lamontagne: Mr. Speaker, the question the hon. member has raised with respect to the control by Canada Post of telephones in rural post offices is certainly a surprising one. We are constantly beleaguered in this House by members across the aisle about post office deficits and alleged extravagance and incompetence in the operation of postal services. Yet when we move to rationalize an area in which taxpayers can save money, they complain.
The issue goes far beyond the line costs. These telephones were in use for many purposes which had nothing to do with the delivery of mail. Much of the time used on the phone and attending to the phone was related to personal rather than to post office business. So this is not just a financial but also a social issue and our policy with respect to it has been going on for many years without complaint. The great majority of rural post offices are situated in private homes or in small local businesses which have telephones of their own.
Again, we are faced with a question intended to dramatize the problem. What problem, Mr. Speaker? The hon. member has asked why we are now expecting people from outlying areas to drive into town to find out whether there is a parcel for them rather than telephone ahead to the post office before they leave their homes. Mr. Speaker, the population of Churchill riding-and I have great respect for them-know better. Citizens in urban areas are faced with the same problem, if indeed this is a problem. If a person living in a city is at work when our courier calls, the post office will deliver a notice that the parcel is at the post office. There is no need for the telephone. Our customers in rural areas are treated in the same manner. They, too, receive a notice that their parcel is at the post office where it can be picked up during regular hours. In the constituency of the hon. member for Churchill (Mr. Smith), the communities of Church, Gillam, Lynn Lake, Leaf Rapids and Norway House still have phones and will continue to have phones if they wish. Our service concerns first class mail and we can efficiently maintain a good level of service by using first class mail.
The removal of the phone from some of these offices will not adversely affect the level of our service. If, for security or for some other good reason, a phone is needed, we at the post office are always open to consider such matters.


The Acting Speaker (Mr. Turner):: The motion to adjourn the House is now deemed to have been adopted. Accordingly, the House stands adjourned until tomorrow at 2 p.m.
Motion agreed to and the House adjourned at 10.30 p.m.

Tuesday, May 9, 1978