1978-11-07

Mr. J. M. Forrestall (Dartmouth-Halifax East):: Mr. Speaker, I rise, under the provisions of Standing Order 43, to move a motion of some urgency. Traditionally, the Atlantic region is the hardest hit when government, in the name of restraint, drastically changes its monetary and fiscal policies. Considering the fact that we are probably more dependent upon the small business community than most other regions of Canada, and that these very abrupt changes and abnormally high interest rates will have a very serious impact on that segment of our economy, I move, seconded by the hon. member for Central Nova (Mr. MacKay):
That the Prime Minister direct the Minister of Regional Economic Expansion to cause the preparation of a strategy in the very near future which will have the effect of offsetting any major, unbearable and unacceptable economic impact in that area.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EXTERNAL AFFAIRS
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, I rise under the provisions of Standing Order 43, on a question of urgent and pressing necessity to move the following motion:
That this House welcomes Prime Minister Begin of Israel to our country and commends President Carter of the United States, President Sadat of Egypt and Prime Minister Begin for their efforts to bring about peace in the Holy Land, and this House of Commons expresses the hope that the city of Jerusalem, on the basis of history and heritage, shall, in its entirety, be part of Israel.


Mr. Speaker:: I hope that the right hon. member will understand, from the tone of the debate which took place yesterday, that the use of this Standing Order for such a complimentary motion will soon be fulfilled without the necessity of putting the question, because we expect this honoured guest to be here very shortly.


John George Diefenbaker: Mr. Speaker-


Mr. Speaker:: Order, please. The hon. member for Edmonton-Strathcona.


John George Diefenbaker: Mr. Speaker-


Mr. Speaker:: Order, please. The hon. member for Humber-St. George's-St. Barbe.


John George Diefenbaker: Mr. Speaker-


Mr. Speaker:: Order, please. I am sure the right hon. member will recall that several times in the past I have refused to put the question when there has been an endeavour to use this motion for congratulatory purposes of any sort, and I think I must be consistent with that.


Some hon. Members:: Hear, hear!


POST OFFICE
Mr. Fonse Faour (Humber-St. George's-St. Barbe):: Mr. Speaker, under the provisions of Standing Order 43, I move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House calls upon the Postmaster General to rescind the directive that post offices are to operate this Saturday, November 11, on a normal day service, it being the view of all members of this House that veterans employed by the Post Office should not be required to work on Remembrance Day, but that they and all Canadians should have the opportunity to show respect for those who gave their lives for this country.


Some hon. Members:: Hear, hear!


Mr. Speaker:: The presentation of such a motion for debate at this time, pursuant to Standing Order 43, can be done only with unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.

November 7, 1978


GOVERNMENT ADMINISTRATION
Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, I rise, under the provisions of Standing Order 43, to move a motion of urgent and pressing necessity. In light of the recent discovery of a computer theft in Los Angeles totalling over $ 10 million, considering that computer frauds are now expected to exceed $300 million annually, and in light of statements by Donn Parker, the world's foremost authority on computer crime, who said that security procedures had not kept pace with the tremendous advances in technology, I move, seconded by the hon. member for Portage (Mr. Masniuk):
That this very serious problem be referred to the appropriate standing committee for study to ensure the proper safeguards are in place for detecting computer fraud and embezzlement within Canadian government departments which have 18 large-size computers.


Mr. Speaker:: Such a motion can be presented for debate at this time only with unanimous consent of this Elouse. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


FISHERIES
Mr. Andy Hogan (Cape Breton-East Richmond):: Mr. Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43. On October 10, I asked the Minister of Fisheries and the Environment why his department was getting out of the profitable fishing vessels' insurance business. I was not satisfied with the minister's answer as to why he thought it was necessary to privatize this plan which has been in operation since 1954.
At the end of October, representatives of all factions of Nova Scotia fishermen gave a rare show of solidarity at the second annual Nova Scotia fisheries conference-


Some hon. Members:: Order.


Mr. Speaker:: Order, please. The hon. member should put his motion forthwith.


Andrew Hogan: My motion is that, since Nova Scotia fishermen gave a rare show of solidarity at the second annual Nova Scotia fisheries conference at the end of October, the federal government stay in the vessels' insurance business. I move, seconded by the hon. member for Humber-St. George's-St. Barbe (Mr. Faour):
That the Minister of Fisheries and the Environment reconsider this policy which is unacceptable to Nova Scotia fishermen.
[Mr. Speaker.)


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EMPLOYMENT
Mr. Maurice A. Dionne (Northumberland-Miramichi):: Mr. Speaker, in view of the conflict between the current trend in rising employment and the statement by the governor of the Bank of Canada before the Standing Committee on Finance, Trade and Economic Affairs last night, I move, seconded by the hon. member for Pontiac (Mr. Lefebvre):
That the Minister of Employment and Immigration make a statement on motions as soon as possible to reassure the Canadian public that there will not be a rapid rise in unemployment.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


POST OFFICE
Mr. Gordon Towers (Red Deer):: Mr. Speaker, I rise on a matter of urgency under the provisions of Standing Order 43. The Postmaster General (Mr. Lamontagne) answered a question put by the hon. member for Brandon-Souris (Mr. Dins-dale) on October 31, 1978, as reported at page 637 of Hansard, as follows:
Reports I receive indicate that workers are back to work: they are working better than they have ever worked.
In view of the fact that is not so, because the mail sorting rate in some areas is less than 50 per cent compared to one month ago, and tension is mounting which has an adverse effect on employee morale, I move, seconded by the hon. member for Brandon-Souris:
That the Postmaster General meet immediately with the Association of Postal Officials of Canada to attempt to resolve this unacceptable situation, because establishment of a Crown corporation will not remove the frustrations forced on dedicated postal workers, including management.


Mr. Speaker:: Presentation of such a motion requires unanimous consent. Is there such consent?
November 7, 1978


Some hon. Members:: Agreed.


Some hon. Members:: No.

[ Translation]


THE CANADIAN ECONOMY
Mr. Eudore Allard (Rimouski):: Mr. Speaker, under the provisions of Standing Order 43, I ask for the unanimous consent of the House to move a motion dealing with a question of pressing and urgent necessity.
In view of the fact that the Bank of Canada has recently announced that the discount rate would be raised from 1014 per cent to 103A per cent, considering that it is the third raise in the past two months, I move, seconded by the hon. member for Abitibi (Mr. Laprise):
That the House strongly disapprove that action of the Bank of Canada an effect of which among others will be to increase interest rates on mortgages to record levels, further impoverishing many Canadians and contributing to enrich our chartered banks.


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


Some hon. Members:: Yes.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, in the absence of the Minister of Finance, perhaps I can direct my question to the Prime Minister.
Governor Bouey, yesterday evening before a standing committee of this House, in defending his decision to raise the bank rate to 10.75 per cent, made it very clear that he felt we in Canada, were in a position where we must start defending the dollar at its present level. In fact, he went through the British scenario and said that now is the time to stop the guise, presumably, of allowing the dollar to fall any further. Will the Prime Minister indicate if, in fact, this means government policy has changed, that we do not necessarily have a floating dollar and, if it is floating, clearly in the future it will be anchored?
Oral Questions


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, there is a rule on the desirability and wisdom of commenting on proceedings of committees of this House. The rule makes a lot of sense, because it covers matters which have been raised partly in committee and are not within the knowledge of anyone who was not on the committee. Personally, I do not know exactly what Governor Bouey said. I can say, unequivocally, that government policy on the dollar will be announced by a minister and by the governor of the bank. Beyond saying this, I do not know what the governor said.


Sinclair McKnight Stevens: Mr. Speaker, I note the Prime Minister said that government policy will be announced by a minister, presumably not necessarily the Minister of Finance, as we have found in the past. Would he comment on a statement made in the House yesterday by the Minister of Finance? It indicates clearly that we have now developed an economic policy in Canada where we appear to be a mere echo of the United States economy, and the Minister of Finance has stated that, with the balance of payments deficit in Canada, we have no choice but to make sure that the bank rate is higher than that in the United States.
Would the Prime Minister tell the House what policy has permitted the current account deficit to prevail for four years at roughly $4 billion per year, when we were told repeatedly that the falling dollar itself would help cure that current account deficit?


Pierre Elliott Trudeau: Mr. Speaker, there is obviously some misunderstanding in the hon. member's mind. The dollar itself and the value of the dollar helps trade, visibly and invisibly, but it does not necessarily help the whole current account exchange situation. The flowing of capital movements is not directly related in the same sense as trade to the level of the dollar.


Sinclair McKnight Stevens: Mr. Speaker, my final supplementary is to the Minister of Finance. Following the questions that I put to the Prime Minister in which I quoted the statement the Minister of Finance made yesterday, that there was virtually no alternative but to raise the bank rate to something above the American level as a result of Canada's current account deficit, would the Minister of Finance indicate to the House if he does not agree that a contributing factor to the objectionably high interest rate structure in this country is also his government's own deficits, the $11.8 billion financial requirement that is anticipated for the present year?


Hon. Jean Chretien (Minister of Finance):: Mr. Speaker, we have made some announcements that we are planning to reduce the deficit, and we have cut the expenditures, as outlined in the August exercise, to reduce it by a very substantial amount of money next year. I am glad that the hon. member does see a problem in the deficit of the government, because when I look-


Sinclair McKnight Stevens: Forty billion dollars.

November 7, 1978
862____________________________________
Oral Questions


Joseph Jacques Jean Chrétien: -at the programs of the opposition, they have planned a deficit of $5 billion more than the government.


INCREASES IN INTEREST RATES-ADVERSE ECONOMIC IMPACT IN ATLANTIC REGION
J. Michael Forrestall: Mr. Speaker, I have a question that I would like to direct to the Minister of Finance. It arises out of the recognition that when the government imposes what can be described as restrictive monetary fiscal policies, it is the Atlantic economy that is first hit and which takes longest to recover.
I wonder if the minister, in consideration of what has happened in recent days and weeks, has come up with a specific and urgent proposal which he is now prepared to put forward that will help ease that type of historical, sudden and very severe impact on the economy in the Atlantic region?


Joseph Jacques Jean Chrétien: Mr. Speaker, the government has many programs to deal with the problems of regional disparity. When I present my budget, 1 will direct my attention to that problem.


J. Michael Forrestall: Mr. Speaker, I would like to direct a supplementary question to the Minister of Regional Economic Expansion who is fully aware of the historical impact to which I have referred.
In view of the inability or unwillingness at this time of the Minister of Finance or the Prime Minister to indicate specific and urgent strategies which would help to offset this impact, what specific new suggestions has the minister put forward in recent days during his meetings with the Atlantic premiers regarding this type of impact and the very serious situation that faces us this winter?
[ Translation]


Hon. Marcel Lessard (Minister of Regional Economic Expansion):: Mr. Speaker, last week I had the opportunity of meeting the premiers of the four Atlantic provinces with whom I discussed the programs being implemented there. I advised the premiers, as well as my counterparts provincial, of our intention of increasing to the greatest possible extent some of our resource development programs such as in agriculture, energy and industrial structures. In coming weeks, we are going to see just how much we can add to some of those program in order to increase development in those sectors.


J. Michael Forrestall: Mr. Speaker, I gather from what the minister said that there is no intention on the part of the government, or that he did not during these meetings bring forward any new initiatives based on the urgency that presently faces Atlantic Canada.
May I ask specifically whether the minister might not now reconsider the very serious cutbacks and their impact, coupled with the impact of the very high, unacceptably high, interest

rates for Atlantic businessmen that he has made in his own development program?


Marcel Lessard: Mr. Speaker, the budgetary restrictions which may have affected the Department of Regional Economic Expansion were really quite minimal. One program only could affect the economy negatively, if one can speak of the economy as such, in the Atlantic provinces and that is the program on land registration. But there are other programs for which we shall increase our expenditures so that, all in all, the amounts of money spent by the Department of Regional Economic Expansion in the Atlantic region will not be reduced-in fact, they will be increased in coming months and next year.


INCREASES IN BANK RATE-FURTHER UNEMPLOYMENT RESULTING THEREFROM
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I have a question for the Minister of Finance. Considering that the unemployment figures which came out today still leave Canada with the highest level of unemployment in the industrial western world, would he confirm to the House that when he discussed the most recent increase of the Bank of Canada with Mr. Bouey-three times on the weekend, I am told-Mr. Bouey informed him that the inevitable consequence of a further increase would be further increases in unemployment? If he was not told that, did the minister ask Mr. Bouey if that would be the result?


Joseph Jacques Jean Chrétien: Mr. Speaker, the hon. member did not mention that in a year we have created more than 262,000 new jobs in Canada and that unemployment is going down.


Pierre Elliott Trudeau: Three hundred thousand.


Joseph Jacques Jean Chrétien: Yes, 362,000.
Of course, the government is always preoccupied with the level of unemployment and we keep working on it. I have discussed that problem with the governor of the Bank of Canada. As he explained yesterday to the committee of the House, if we had not moved, it would have created a bigger problem in Canada that in the medium-term would probably have caused more unemployment. I think the stability of the Canadian economy and currency is fundamental to proper economic growth in this land.


John Edward Broadbent: Mr. Speaker, the minister took almost two minutes not to answer the question, so I will not trouble to repeat it. Considering that probably the most disturbing figure in all those that came out today showed that we experienced a net loss of 11,000 manufacturing jobs in the past month, for the second month in a row, would the minister not agree that we are now experiencing the delayed effects in the economy of the five previous increases in the bank rate?
November 7, 1978


Joseph Jacques Jean Chrétien: Mr. Speaker, of course, the hon. member is very good at making good news into bad news: he lives on it. I think if you look at the performance of the Canadian economy over the last year, however, there has been a very substantial increase in the number of manufacturing jobs; in fact, it is more than 100,000. Of course there is a fluctuation from month to month, but I think one can have a larger view than just looking at only one month.


John Edward Broadbent: Mr. Speaker, as usual, the minister has got his facts wrong. In the past two months only has there been a decline in the number of manufacturing jobs; in every other month this year there was a slight increase. I will let the minister correct that, but he should check the figures.
I should like to repeat the point and get an honest answer from the minister. If we have had a decline in manufacturing jobs two months in a row, would he tell us if he has received from the Ontario government a submission pointing out that, because of its fiscal and monetary policies, the federal government has made a mess of the manufacturing sector? Would he confirm that he has received that submission? More importantly, would he tell the House, at long last, what he intends to do to stimulate growth in the manufacturing sector, which is the crucial sector in the economy for long-range growth?


Joseph Jacques Jean Chrétien: Mr. Speaker, I think the best stimulus the manufacturing sector has received for some time has been the fact that in Canada we are more competitive in world markets. If the hon. member will look at the figures that we have on trade surplus, he will see that we are selling much more abroad than before. I know it took him a long time to recognize that there has been a substantial increase in the number of jobs in the manufacturing sector over the last year, but when the Canadian Manufacturers' Association came to Ottawa to make representation two weeks ago, that is what they said.


UNEMPLOYMENT INSURANCE
Mr. C. A. Gauthier (Roberval):: Mr. Speaker, once again my question is to the Minister of Employment and Immigration.
Referring to section 57 of the Unemployment Insurance Act, the minister said, in his answer of November 3 that before 1967 the act contained a provision pursuant to which agricultural workers could be exempted by working on a voluntary basis. Since it seems this provision did exist before 1967, could the minister tell the House whether this change, that is the end of voluntarism, occurred following representations from the Canadian Federation of Agriculture or from the Unemployment Insurance Commission?
Oral Questions


Hon. Bud Cullen (Minister of Employment and Immigration):: Mr. Speaker, it was due to both the federation and the public servants, because of administrative difficulties.


THE CANADIAN ECONOMY
Mr. Otto Jelinek (High Park-Humber Valley):: Mr. Speaker, I would like to put my question to the Minister of State (Small Business): it is with regard to the further increase in the bank rate, which the minister knows is so harmful to the small businessman.
In view of the fact that the small business sector is already experiencing damaging setbacks as a result of the uncertainty and confusion this government's ad hoc policies have created, and because the bankruptcy rate in this sector increased by an unprecedented 41 per cent in the first six months of this year over last year, has the minister made, or does he intend to make, any positive representations to the cabinet which would perhaps protect the small businessman from these exuberant bank rates, because without some kind of protection, as the minister knows, the very survival of many small businesses is threatened?


Hon. A. C. Abbott (Minister of State (Small Business)):: Mr. Speaker, if the hon. member is trying to alert me or the government to the severe problems small business faces as a result of sharply increasing interest rates, I would agree with him that this is creating a very undesirable difficulty: cash flow problems are resulting, and it is a matter of very real concern. But I would say that the United States and, consequently, ourselves have not introduced these changes to punish the business community or to somehow depress the economy.
I would say that if the result of these stabilizing plans both in the United States and here have the effect of stabilizing North American currencies, have the effect of putting a damper on inflation and have the effect of restoring confidence in our business community abroad, then I would suggest that, despite the problems being faced, the cash flow problem is a result of higher interest rates and the price will be justified by the confidence that will be engendered. However, in answer to the member's point-


Some hon. Members:: Oh, oh!


Anthony Chisholm Abbott: I would say directly that I am-


Mr. Speaker:: Order, please.


Otto John Jelinek: Mr. Speaker, I would hope that I would not have to alert the minister of the problem with bank rates: I just wanted to find out what he is doing. Obviously, he has not been able to answer that. The minister knows that small business usually operates on a relatively small profit margin, very often dependent on concrete and long-term interest rates.
8006 5-5 5'A

November 7, 1978
Oral Questions
Could the minister tell this House whether or not he has taken this matter up with the cabinet, or with the banks, requesting a form of favoured treatment for small business as far as interest rates are concerned? If not, is the minister perhaps prepared to look again at the Small Business Loans Act in order to include working capital at preferential rates for the small businessman within that act?


Anthony Chisholm Abbott: Mr. Speaker, I consider it an important part of my job to advocate to the Minister of Finance, and other ministers who have a direct responsibility for economic change, ideas such as the last one expressed by my hon. friend. But I would reiterate that if he thinks that because interest rates are going up, this government is not concerned with their effects on small and medium business, he is wrong. I think our larger concern has to be with restoring, in the eyes of the world, the stability of the North American economies. For that reason, I enjoin him and others to make certain that they take a responsible attitude toward this problem.


Mr. Baker (Grenville-Carleton):: We need an election for that purpose.


Otto John Jelinek: Mr. Speaker, the minister's rhetoric is not helping the small businessman. I have two questions for the minister. I ask him what, if any, steps he has taken in order to assist the small businessman in this regard. I would like to have a specific answer from him as to whether he has taken any steps, or intends to take any steps, to assist the small businessman in this specific instance.


Anthony Chisholm Abbott: Mr. Speaker, last June certain measures were introduced to help small business. Other measures have been introduced of which the hon. member is aware. I reiterate that it is not my role to announce policies that directly affect small business. It is my role to attempt to advocate to the Minister of Finance suggestions along the line of the last part of the hon. member's previous question. I can assure him that is exactly what I am doing and will be doing in the weeks ahead.
 * *


TRANSPORT
Mr. Don Mazankowski (Vegreville):: Mr. Speaker, my question to the Minister of Transport is in connection with the transportation problems that continually confront the grains industry. It arises from the statement made by a senior official of the Canadian Wheat Board that Canadian sales of export grain must be limited to 21 million metric tonnes because that is the maximum quantity that our transportation system can physically handle.
Since this is the same 21 million tonnes capacity that we had in the record year of 1972-73 which the minister refers to quite frequently, I would ask the minister how he can justify this further loss of sales, in face of the government's commitments

at the WEOC conference in 1973 and in face of the Liberal government's commitments during the election period of 1974 which committed them to revamping the grain handling system from the granary to the ship in the harbour. Can the minister today offer any new hope to the producers of Canada who are becoming increasingly frustrated and fed up by our inability to move grain and take advantage of export opportunities?


Hon. Otto E. Lang (Minister of Transport and Minister of Justice):: Yes, Mr. Speaker, I can give reassurances to the grain farmer as a producer of exports for the world. This year we have been talking about the challenge of trying to move 23 million rather than 21 million tonnes. I should emphasize that these figures were actually more than is produced in anything but an absolutely fantastic crop on the prairies in any one year. Therefore, we are able to move an amount of record production, plus some more.
The question is, how much more capacity should we have? I am one who years ago staked out the position that we must target on being able to move a billion bushels of grain rather than the 850 million or 870 million bushels I am talking about now. I believe that is still very true. It is for that reason we have been buying hopper cars and rehabilitating and rebuilding branch lines in a very important way. We have been getting a far faster turnaround time on our equipment, as the Snaveley report will show as soon as it is available to hon. members. We have a study now under way in relation to the total question of the parts of the system used for operating and moving grain more quickly. Obviously, while we want to go on moving more, we want to do it efficiently and at the lowest cost.


Donald Frank Mazankowski: Mr. Speaker, surely the minister knows we have had to defer 1 Vi million tonnes of grain exports from the last crop year to this crop year, and that further deferrals are taking place in this current crop year with respect to movements out of Thunder Bay. The minister should also know that the Canadian Wheat Board had to turn down the sale of four million tonnes of grain into the export market. The minister should also know that we have a situation-


Mr. Speaker:: Order, please. Does the hon. member intend to put a question?


Mr. Clark:: He is answering the minister's question.


Mr. Speaker:: I was not aware, to answer the Leader of the Opposition, that it was a function of the questioner to answer the previous question.


Donald Frank Mazankowski: The minister's statement cannot go unchallenged.


Mr. Speaker:: Order, please. I am not asking that anybody's statements go unchallenged. This is a period for putting questions.


Charles Joseph Clark: And receiving answers.
November 7, 1978


Mr. Speaker:: There may be other occasions to challenge in debate. If the hon. member insists on debating, I will have to go to another question.


Donald Frank Mazankowski: A sort of supplementary, Mr. Speaker, and 1 appreciate your consideration. We have in Canada a country elevator system that is literally plugged. Our terminal stocks are down to one half. The railways have indicated that the utilization is less than a full 100 per cent in terms of their grain carrying capacity on an annualized basis. CP have indicated that during the months of September, October and November they were only called upon to utilize one half of their grain carrying capacity.
I ask the minister specifically if he is looking into this problem to ensure that the interface with regard to our grain sales and grain movement is better co-ordinated and better planned.


Otto Emil Lang: Mr. Speaker, in addition to doing the things I indicated in my earlier answer and appointing co-ordinators at the terminals in Vancouver and Thunder Bay, the very purpose of having consultants in place is to look after this interface. The hon. member was apparently critical when we put these consultants in place, yet it is obviously important. Let me say, however, whenever we are moving an absolute record at the limit of our capacity, obviously there will be strains within the system. One of our objectives is to test those strains and to keep strain on the system. When the ships do not arrive on time, as they did not in August and September, that is a difficulty which piles up for later and that we all understand.
I would also like to point out to the hon. member, so that it is understood across this country as it is understood by the prairie farmer, that we have just had three all-time record crops. If only one of those had been average instead of record, it would be a problem of grain supplies rather than a problem of movement. Obviously, we want to be able to build toward moving a billion bushels of grain because we know we can develop even further productive capacity by doing so. But do not be too excited about difficulties when we are pushing the system to its maximum.


FLOOD PREVENTION PROGRAM IN NORTH MONTREAL- GOVERNMENT POSITION
Mr. Marcel Roy (Laval):: Mr. Speaker, I have a question for the Minister of Fisheries and the Environment.
Considering the extent of the work being done to control the water level and reduce the risks of spring floods in the area north of Montreal, particularly in Laval along the Prairies river and the Mille-Isles river, and contrary to the press release issued by the local Parti Quebecois members, does the minister intend to go on with this work until March 31, 1980, as was
Oral Questions
stated in the Canada-Quebec agreement signed in August, 1977, in order that the victims of these floods will rest assured that we will continue to improve this situation which has already lasted for too long?


Hon. Len Marchand (Minister of State (Environment)):: Mr. Speaker, I am pleased to advise the hon. member that although we have had some cuts in our diking program both in the Montreal area and in British Columbia, we will be able to honour all of the commitments that we made under the 1975 agreement for diking in the Montreal area which was signed by my colleague, now the Minister of Communications. My office notified the hon. Yves Berube minister of natural resources, of this on October 18, 1978.


TRANSPORT
Mr. Doug Neil (Moose Jaw):: Mr. Speaker, my question is supplementary to that asked by the hon. member for Vegre-ville: it is addressed to the minister in charge of the Canadian Wheat Board.
In view of the fact that recent statements by officials of the Canadian Wheat Board, grain companies and the railways indicate that because of strikes, underutilization of the railways and other factors in the grain handling and transportation system, grain sales have been deferred, delayed or cancelled, in view of the fact that deferral of deliveries this year to date has been V/2 million tonnes out of Vancouver and half a million tonnes out of Thunder Bay-in this crop year-and in view of the importance of the grain trade not only to western Canada but to the whole of our economy, will the minister take the first opportunity to make a statement on motions giving details to this House of the grain deferrals, lost sales and cancellations, in order that the producers of western Canada and the members of this House may be aware of the facts?


Otto Emil Lang: Mr. Speaker, the Wheat Board has been making these reports to producers and will be the appropriate body to continue making them. I would like to add that we are taking all the steps we can take to try and minimize any problem in loss of sales and in moving more grain.
We are looking at the question of whether there is any possible way, for example, of getting any extra time on the functioning of the Seaway or other ways of moving more grain to market. That continues to be our pressing concern. When we were in a situation of trying to move the absolute maximum amount of grain, the fact of a strike on the Great Lakes was a clear minus in terms of how it would interfere with the movement to some extent. We do not know at this stage how

November 7, 1978
Oral Questions
far we can go in expediting the movement of vessels to make up for that loss.


Douglas Charles Neil: Mr. Speaker, the producer in western Canada looks upon the situation as being critical. I wonder if the minister is prepared to take immediate steps to have officials of the Canadian Wheat Board, grain companies and railways appear before either the Standing Committee on Agriculture or the Standing Committee on Transport and Communications, so that members and producers can be made aware of all the facts and problems and consider any recommendations and suggestions which may be made by those officials and representatives of other organizations?


Otto Emil Lang: Mr. Speaker, I would be glad to consider that with officials of the Wheat Board and other organizations. However, I think the urgent thing at this moment is that they have all their time free to deal with the problem and to make sure they move as much grain as possible, rather than be deflected from that even to answer the very important questions of the hon. member.


PRESENCE IN SPEAKER'S GALLERY OF PRIME MINISTER MENACHEM BEGIN OF ISRAEL
Mr. Speaker:: Before continuing with the question period, I know all hon. members will want to join with me in extending an extremely warm welcome and best wishes for a successful tour of Canada, and in all his other present endeavours which are of such an important nature not only to his own country but also to peace in the world. I refer to the presence in our gallery now of the very distinguished Prime Minister of Israel, His Excellency Menachem Begin.


Some hon. Members:: Hear, hear!


FINANCE
Mr. David Orlikow (Winnipeg North):: Mr. Speaker, 1 would like to direct a question to the Minister of Finance. When he told the provincial finance ministers last week that because they would not go along with his request to reduce federal cost sharing for hospital care, medical care and postsecondary education, he was deferring going ahead with the community services grants program, did he really mean that there would be no federal funds this coming year for neighbourhood renewal programs, sewage treatment programs and low-cost housing?


Joseph Jacques Jean Chrétien: Mr. Speaker, we have decided to postpone implementation of this program which was advocated by the Minister of State for Urban Affairs. As for details on some programs which are terminated, those will come to an end while others will be maintained on the former basis. I cannot be more explicit for the time being. I suggest that this question be directed to the Minister of State for Urban Affairs when he is back in the House.


David Orlikow: Mr. Speaker, it is good to know that those programs which have been started will be allowed to continue. However, a large number of cities have plans which are almost ready for this type of program, and they certainly will not be able to proceed without federal funding because of their financial difficulties and the financial difficulties of the provinces in which they are located.
Can the minister give any idea as to when there will be a decision and an announcement by the federal government that there will be any money available for these programs which are so essential in the various cities of Canada?


Joseph Jacques Jean Chrétien: Mr. Speaker, three programs were involved in the new proposition of the Minister of State for Urban Affairs. Two of them will be terminated by the end of the year; the third one will still be in operation. The hon. member can ask a specific question of my colleague, but if the provinces and municipalities are faced with financing problems, I suppose we have the same problems at the federal level.


LABOUR CONDITIONS
Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, I had a question for the Minister of Industry, Trade and Commerce but, in his absence, I shall direct it to my excellent friend the Minister of Finance. I say my excellent friend because we sit together on the committee.
According to a recent article Canada is in the leading position on the worldwide level as far as unemployment is concerned. This is not in accordance with the statements made by the Minister of Finance. The article says that Canada has a record 8.5 per cent of unemployed. I would like to ask the following question of the Minister of Finance: In the face of all those contradictory statistics, I would like to ask seriously of the Minister of Finance, who now has a budget to prepare and to submit to the House, whether those statistical data are really in accordance with facts and, if so, what he intends to propose to try to further develop the use of our manpower in order to increase our gross national product to become as
November 7, 1978

prosperous as the other industrial countries in the western world?


Joseph Jacques Jean Chrétien: Mr. Speaker, I think the hon. member's question requires a very long answer which involves a complete budget. I must say that it is true that our unemployment level is too high, and 1 regret it. But I would also like to point out to the hon. member that in the last 12 months we created 362,000 new jobs in Canada. Our performance as far as job creation is concerned is not equalled by any industrialized country in the world.


NATIONAL DEFENCE
Mr. Allan B. McKinnon (Victoria):: Mr. Speaker, my question is for the Minister of National Defence. On September 6, the minister said that the proposal for the new fighter aircraft would go to a cabinet committee on September 13 and that there would be a final cabinet decision on September 20. Last Thursday, the Prime Minister said he did not believe that the fighter aircraft program had been before cabinet since last June.
I wonder if the minister can explain how he and the Prime Minister have such different ideas as to what is going on, and can he tell us what is causing this serious delay in the program?


Hon. Barney Danson (Minister of National Defence):: Mr. Speaker, the Prime Minister's information is correct: to the best of my recollection this matter has not been before the cabinet since June. As hon. members know, the vendors asked for additional time to submit. We have given them that additional time to submit. I do not recall committing myself to specific dates, but I stand to be corrected, and I expect to have this matter before cabinet this month, hopefully with a decision on a short list before the end of the month or early in December.


Allan Bruce McKinnon: Mr. Speaker, to refresh the minister's memory, I will say that he stated on March 18 that he hoped orders could be placed in late 1978 and that he was working to have the actual orders placed before the end of 1978.
Will the minister confirm that the armed forces have made their recommendations on which plane or planes they want, and that what is now holding up this program is lack of funding by the government to meet the $2.34 billion which has been promised for the purchase of the new fighter?


Barnett Jerome Danson: Mr. Speaker, I did not quite hear the end of the hon. member's question, but if I may state the status now, there has been a deferment to give the various vendors an opportunity to resubmit. That has been very worth-while time spent for the vendors, for the procurement of the aircraft and, I might add, for the industry of Canada. The dates have
Oral Questions
slipped because of that. I am looking forward to the final contracts being negotiated and the final choice being made in the new year, but not before late spring of the new year.


FINANCE
Miss Flora MacDonald (Kingston and the Islands):: Mr. Speaker, my question is to the Minister of Finance. In his September 8 statement detailing cuts in government expenditures, and particularly in unconditional transfer payments, the minister announced his intention to reduce those payments by some $220 million.
Following the meeting with his provincial counterparts last week, can the minister tell us in what specific programs he now intends to make cuts, and by how much?


Joseph Jacques Jean Chrétien: Mr. Speaker, we said last week that we would be postponing social service programs which we were planning to introduce next year, and the community services program. We have decided to make some adjustments to the equalization formula. There will be an increase in equalization payments, but not as large an increase as has been predicted. There is a fourth program in which there will be a reduction, the public utilities income tax transfer program.


Flora Isabel MacDonald: Mr. Speaker, since the minister's September 8 statement proposed to reduce payments under the Established Programs Financing Act, and since he now finds that because of the five-year agreement under those programs he can no longer make unilateral federal cuts, I wonder if the minister can tell us if it is his intention to compensate for that difference not only by forcing the Minister of National Health and Welfare to abandon her social service financing legislation, but will he also make larger cuts in the equalization program than he originally intended? Further, will the minister try to tamper with the agreed-upon formula under the Canada Assistance Plan?


Joseph Jacques Jean Chrétien: Mr. Speaker, 1 have indicated to the hon. lady the programs we are planning to use in order to take a contribution from the transfer payments. Of course, we cannot exempt the tranfer payments to the provinces. Those account for more than $10 billion. We have been relatively soft in relation to the other cuts in the system. Four programs were discussed with the provinces last week. Those programs will be affected.
In the case of established programs, I tried to modify the formula with the provinces last week. They did not agree, so I have decided not to move in that regard.

November 7, 1978
Oral Questions IMMIGRATION


RE-ENTRY PERMIT SYSTEM
Mr.   Chas. L. Caccia@Davenport: Mr. Speaker, my question is addressed to the Minister of Employment and Immigration. In view of the fact that the new Immigration Act came into effect in April with a provision requiring that certain steps be taken by landed immigrants who leave Canada for more than six months, would the minister inform this House and the public about the specifics of the re-entry permit system so as to prevent hardships and difficulties for bona fide returning residents?


Jack Sydney George (Bud) Cullen: Mr. Speaker, the returning resident requirement does not apply to Canadian citizens. It was put into effect as an accommodation to permanent residents, some of whom found, as a result of being sent out of the country by their employers or because they had to move back to their homeland to straighten out business or private affairs, that they would have concern about getting back into the country; so as an accommodation to returning residents, that particular rule was put in place. It is not meant to be a hurdle to overcome: it is an accommodation to permanent residents.


CANADIAN BROADCASTING CORPORATION
Mr. J. P. Nowlan (Annapolis Valley):: Mr. Speaker, my question is directed to the Prime Minister. Last Thursday, admittedly after a rather heavy week, the Prime Minister answered the hon. member for Northumberland-Miramichi about CBC coverage of the federal-provincial conference. In the last part of his answer on page 728 of Hansard, the Prime Minister said:
I am sometimes amused when the CBC talks about the terrible state of the country, considering the terrible state of the CBC.
The Prime Minister has been the leader of the government for ten years. The Canadian Broadcasting Corporation is a Crown corporation which spends over half a billion dollars. The president and the board of directors are all order in council appointments. I would like the Prime Minister to explain what he meant by "the terrible state of the CBC". Was he talking about the CBC in total or Radio-Canada? Has he expressed this concern to the Secretary of State, who is responsible? Would the Prime Minister please explain what he meant, as leader of this government, about a top Crown corporation to which he makes all the appointments?


Pierre Elliott Trudeau: Mr. Speaker, I explained it on television at the conference proper when I commented on the technical difficulties that the CBC had experienced on the first day of the conference. If the hon. member had been following the proceedings, he would have seen that as a rather light reference to the difficulties the CBC

had. I stand by my remarks. The CBC is very critical of many institutions in Canada. It should not be without criticism itself nor beyond the scope of criticism. I often hear it from the other side.


Some hon. Members:: Hear, hear!


John Patrick (Pat) Nowlan: Mr. Speaker, then can we assume from what the Prime Minister says today that when he referred to the terrible state of the CBC-this was after the conference-it was about the technical difficulties which we all noticed during the conference, that he was not making a blanket condemnation of CBC and that the fact that $71 million was cut from the CBC budget is not related to the Prime Minister's indigestion?


Pierre Elliott Trudeau: Oh, no, Mr. Speaker, I never make blanket condemnations, except sometimes of the hon. member. I think in the case of the CBC I was referring to some specific and recent events. The hon. member knows that I am a great admirer of the CBC and the media in general.


Some hon. Members:: Oh, oh!


FINANCE
Charles Joseph Clark: 1 take it, Mr. Speaker, that the response from across the floor is in reaction to the last Gallup poll, and I accept that.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: My question is-


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. Whatever the cause might be, I wonder if hon. members could restrain their enthusiasm sufficiently to enable us to continue the question period.


Charles Joseph Clark: Mr. Speaker, my question is for the Minister of Finance, who said this morning that it was too early in the day for him to know whether or not the government had decided on a budget date. It is now later in the day, and I wonder if the minister can tell us if the government has decided on a budget date and, if so, when the budget will be brought down to the House of Commons.


Joseph Jacques Jean Chrétien: Mr. Speaker, the day is not over yet.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Mr. Speaker, the day might not be over, but certainly the government is finished.


Some hon. Members:: Hear, hear!
November 7, 1978


Charles Joseph Clark: I wonder if the Minister of Finance could make a radical change in the way he has approached his responsibilities and begin to approach them seriously and tell the House of Commons and the country, which is very much concerned about the uncertainty that has been caused by the mismanagement of economic events, when there will be a budget.
Will he tell us whether a date has been decided, will he tell us whether he will keep his word as to a mid-November budget, and will he tell the House of Commons and the people of Canada when a budget will be presented to this parliament?


Joseph Jacques Jean Chrétien: I think the hon. member is getting a little excited. Yesterday I rose in my seat and said I would give an answer tomorrow or the day after. I am sure he could be patient for 24 hours. I said I would give the date on that day or the following day. I am not giving the date at this moment, and I have until tomorrow to keep my word. I usually keep it.


TRANSPORT
Mr. Les Benjamin (Regina-Lake Centre):: Mr. Speaker, I have a question for the Minister in charge of the Canadian Wheat Board arising out of events that have occurred over the last while and questions asked earlier today.
In view of the fact that the People's Republic of China was in the market for six million to seven million tons of grain, and that the Canadian Wheat Board signed a contract effective September 1 for three million tons, not because that was all China wanted but because that was all the Canadian Wheat Board was capable of delivering, and in view of the fact that Canadian Pacific, with a record profit of $233 million, refused to repair boxcars to increase our grain movement capability, I should like to ask the minister what measures he intends to take to require, first, the railroads to repair and return at least 5,000 railway-owned boxcars to the grain movement and, second, to co-ordinate rail and marine shipping so that the Wheat Board can bid and secure contracts in greater amounts than they have been able to because of this lack of capability.


Otto Emil Lang: Mr. Speaker, I am sure the hon. member will be interested to know that I have not really accepted a final negative from Canadian Pacific on the repair of boxcars. They did indicate they were satisfied that they could move their share of a 23 million bushel movement of export grain. I am a little doubtful about that, so I pressed them again to take up our offer to pay half the cost of repairing 1,000 boxcars.
Of course, we are constantly looking at ways of improving the movement of grain, and a consultant studying the situation might well help in that regard. The one difficulty we still have is in regard to shipping which is essentially under an international regime rather than under our own. A few years ago, the Canadian Wheat Board considered, through an expert committee, whether it should change its system of marketing to
Privilege-Mr. Brewin
improve the shipping as well as the provisions of grain. They might have to look at that once again at this time in the context of the difficulties of ensuring that shipments arrive when they should.


GRAIN NOT BEING MOVED IN WESTERN CANADA
Thomas Gordon Towers: Mr. Speaker, my question is directed to the same minister. Notwithstanding the statements which the minister made in reply to the hon. member for Vegreville and the hon. member for Moose Jaw, grain is piling up in western Canada on farms and in elevators-a $500 million loss which farmers experienced last year because of the inability to move the grain.
Can the minister tell the House what time we are talking about with regard to the recent floods and wash-outs of the railway lines affecting shipments of grain to Prince Rupert, and whether he has any alternative in mind?


Otto Emil Lang: Mr. Speaker, there are no easy solutions to the problems which arise from strikes, landslides or wash-outs when one is trying to move a maximum amount of grain. Again to put the matter into context, I wish the hon. member would not exaggerate. When he said that there was a loss of $500 million worth of grain shipments, he simply misstated the situation entirely. Last year the producers delivered over one billion bushels of grain for the first time in history.


Some hon. Members:: Hear, hear!


Otto Emil Lang: Even though we had an all-time record crop on our hands, we moved the whole of that crop plus a little more. The question is, how much more than that can we move in any given year, and our answer is that we want to be able to move a couple of million tons or another 50 million bushels more than that. That is what we are trying to do.


Mr. Speaker:: Order, please. Yesterday the hon. member for Greenwood (Mr. Brewin) gave me notice of a question of privilege which he said he would proceed with when he and the Solicitor General (Mr. Blais) were next in the House.


PRIVILEGE
Mr. Andrew Brewin (Greenwood):: Mr. Speaker, I rise for the purpose of raising a question of privilege. If Your Honour rules that there is a prima facie case, I will move the question of whether or not the letter from the Solicitor General (Mr. Blais) to me, dated October 27, 1978, is misleading and should be referred to the Standing Committee on Privileges and Elections.

November 7, 1978
870________________________________________
Privilege-Mr. Brewin
On October 19, 1978, I put a question to the Solicitor General in the House. It arose out of a report that one Corporal Radey of the Royal Canadian Mounted Police was being subjected to a secret trial because of information given by him-


Mr. Speaker:: Order, please. May we have less noise?


Some hon. Members:: Order!


Francis Andrew Brewin: The question I put to the Solicitor General arose out of a report that Corporal Radey of the RCMP was being subjected to a secret trial because of information given by him to the Laycraft commission in Alberta that he was the victim or one of the victims, or was concerned with a bugging incident by the RCMP.
The minister did not have the information available, but promised to supply it later. On October 27, 1978, I received a letter from the Solicitor General, which letter is the subject matter of my question of privilege. In my view, the letter is false and misleading. It attempts to dissociate the charges pending under the Royal Canadian Mounted Police Act from the matters arising before the Laycraft commission.
The letter indicated that Corporal Radey had been charged with two service offences pursuant to the provisions of the Royal Canadian Mounted Police Act, both of which related to his conduct as a member of the force. It is alleged that he made false statements in writing to his superiors and failed to obey the lawful command of his superiors. The letter indicated that Radey was one of the principal witnesses involved in the Laycraft inquiry, but that the Solicitor General was informed that the service offences referred to did not arise from the fact that he had given evidence before the Laycraft commission or from the substance of his evidence. Then the letter contains the following sentence:
The service offences relate to his conduct pertaining to an internal investigation and his conduct relating to a lawful command.
The clear implication of this letter is that the charges, for which Corporal Radey was being tried by the RCMP, were not connected with the evidence given or statements made by him in connection with the Laycraft inquiry.
I accepted the minister's statement in his letter, and decided, as the charges under the act against Radey were apparently an internal matter of the RCMP, unconnected with the Laycraft commission, that the matter did not require further concern by myself. However, later on, upon investigation of the actual charges against Radey, it was made abundantly clear to me that the letter was false and misleading.
The first charge against Radey related to an allegation that he had spoken to Chief Superintendent Schramm and Inspector Palmer. The matter in question was the evidence as to the alleged bugging to be brought before the Laycraft commission by Corporal Radey.
The second charge more clearly involved the Laycraft inquiry. It was that Radey disobeyed instructions from Inspector Palmer to discuss his evidence only with counsel for the RCMP, and the fact that, contrary to this instruction, he

discussed the matters with the counsel for the commission. Inspector Palmer was said to have instructed that he must not consult or discuss with counsel for the judicial inquiry the matters in question, but that he must contact only one Stevens Guille, who was counsel appearing for the RCMP before the Laycraft commission.
The second part of the first charge against Radey employs exactly the same language, word for word, as does the report of the Laycraft commission. I can cite that reference in the report. The statement in the letter indicating the service charges did not arise from the fact that Corporal Radey gave evidence to the Laycraft commission, or did not arise from the substance of his evidence, was and is misleading.
Apparently the purpose of the misleading statements in the minister's letter was to make it appear that the proceedings under the Royal Canadian Mounted Police Act and the secret trial were unconnected with the Laycraft commission. Of course this was false. Evidently someone wishes to discourage any attempt to link the internal RCMP charges with the Laycraft commission. The whole question of the use of the Royal Canadian Mounted Police Act to restrict and restrain an individual police officer from communicating to a judicial commission evidence he planned to present to that commission is raised by this matter.
I do not accuse the minister of deliberately misleading myself or the House, but I suggest that in sending out such a letter the minister was careless, reckless, and sloppy, at the very best.
I will not repeat the general observations of the hon. member for Northumberland-Durham (Mr. Lawrence) concerning the seriousness of misleading members of the House about matters inquired into in the House or connected with House business. Merely I want to emphasize that the whole function of parliament can be defeated if inquiries by members on matters of concern to the House are to be deflected by carelessly drawn or, indeed, intentionally misleading responses in letters. Our duties as watchdogs of the rights and freedoms of individuals will be frustrated if this sort of thing is permitted and becomes common.
If Your Honour rules that I have made a prima facie case of breach of privilege, I will move, seconded by the hon. member for Broadview (Mr. Rae):
That the matter of the alleged misleading letter of the Solicitor General to me, his letter of October 27 relating to Corporal Radey and the charges laid against him under the RCMP Act, be referred to the Standing Committee on Privileges and Elections for inquiry and report back to the House.


Hon.   J.-J. Blais@Solicitor General: Mr. Speaker, I have listened with a great deal of interest to what the hon. gentleman has said, and I take his question very seriously. I have no difficulty with the facts the hon. gentleman has advanced in terms of the correspondence being exchanged and the fact that a question was asked in the House. I quite understood the nature of the hon. gentleman's question when it was put in this House, and I replied at that time that I had just been made
November 7, 1978

aware of the matter immediately prior to coming into the House and that I would look into it and reply to the hon. gentleman.
I quite readily accepted that the hon. gentleman had raised some connection between the charges and the Laycraft inquiry. That is why, contrary to his allegations, 1 was very careful in the reply that I forwarded to him. Jt was a reply which I reviewed quite attentively. I would cite again the paragraph to which he has referred. I stated that while this NCO was one of the principal witnesses involved in the Laycraft inquiry, I was informed that the service offences referred to do not arise from the fact that he gave evidence, nor from the substance of his evidence. The service offences relate to his conduct pertaining to an internal investigation and to his conduct relative to a lawful command.
If the hon. gentleman reviews the charges, which were the subject of a writ of prohibition application before the Federal Court, he will see quite readily that the charge under Section 25 of the RCMP Act refers, not to the evidence that he gave before the Laycraft inquiry, but to a statement that he himself made to his superiors quite categorically, and to a directive that had been issued to RCMP officers that was allegedly not followed. That is the pith and substance of the two counts this gentleman faced. Again, I would simply refer the hon. member to the specific counts that are identified in the internal disciplinary charge.
The service corps proceedings that the hon. member referred to were initiated against Corporal Radey in relation to allegations that he had, indeed, made a false statement and that he had failed to abide by the lawful command of his superiors.


An hon. Member:: What were the orders?


Mr. Blais:: The orders were that he was not to consult with solicitors other than those of the RCMP prior to giving evidence to the commission. Those were orders which were issued by the RCMP in terms of the organization of evidence for the Laycraft inquiry.
Corporal Radey was charged, pursuant to section 25 of the Royal Canadian Mounted Police Act, and the service corps proceedings, which are internal disciplinary hearings in the RCMP and are authorized, are held strictly in accordance with the provisions of the RCMP Act. The procedures provided for the presentation of a full defence to the service charges. The member, subject to the hearings, has a right to be represented by another member of the force, and these hearings are held in camera. Members convicted in service court have a right of appeal to the commissioner and, of course, a right to apply for review under section 28 of the Federal Court Act.
In the case of Corporal Radey, the member representing him made a motion on the grounds that the tribunal lacked jurisdiction in that the proceedings were instituted more than six months after the alleged offence. That motion, which was as a preliminary objection before the hearing tribunal, was denied at the time it was moved. An adjournment was obtained so that the application could be made to the Federal
Privilege-Mr. Brewin
Court. The Federal Court held that the motion was a proper one and that section 721 of the Criminal Code prevailed in terms of disciplinary offences under the RCMP Act. As a result of that, the writ of prohibition was issued.
Before the House last adjourned, Mr. Speaker, I introduced a bill, Bill C-50, to amend the RCMP Act. This bill died on the order paper. However, it is the government's intention to reintroduce the bill at the first opportunity. It will propose certain changes with respect to internal discipline in the RCMP and in essence it will provide for the enactment of a code of conduct which will apply to members of the force. Contraventions of this code of conduct can lead to informal disciplinary action or, in serious cases, formal disciplinary action.
This is why I was pleased that the hon. member for Greenwood (Mr. Brewin) raised his question in the House at that time, because of my intention to introduce Bill C-50.1 am sure the hon. gentleman is mindful of the fact that there has been a commission of inquiry set up under Judge Marin, who made a report relating to matters touching internal discipline within the RCMP. The bill which we will be introducing follows very closely the recommendations of the Marin commission.
Formal disciplinary action will require a hearing which will be held in private, under the proposals in this bill. Under this bill, the member whose conduct is the subject of the hearing, as well as all witnesses called to give evidence at the hearing, will be entitled to be represented by counsel. The bill will provide for two levels of appeal, the first being the internal board of review, which will review the proceedings on the record, and a further appeal on the record to the commissioner.
Provision is also being made for review by an external review committee if the member has been ordered to pay a fine. The review committee will examine the matter on the record, receive written submissions, and the member concerned may present argument personally or through counsel, following which the review committee will submit a report with its comments and recommendations to the commissioner.
Because of the general interest that has been manifested by the hon. member for Greenwood in this matter, I thought that it would be informative for him to be made aware of the fact that we are interested in proceeding with this bill. I would reiterate with regard to his question of privilege that I provided what I felt was forthcoming information relating to specific charges, that I had identified and described the nature of the charges. In the last paragraph of my letter I indicated that there was a writ of prohibition that had been filed with the Federal Court and that I felt that it would be inappropriate for me to make any further comment with respect to particulars. Therefore I kept my reply to the essential ingredients which he had addressed, and I feel that I discharged my responsibilities in accordance with those responsibilities.


Some hon. Members:: Hear, hear!


David Orlikow: Mr. Speaker, I have had the feeling for some considerable time now that if one asks
80065-56%

November 7, 1978
Privilege-Mr. Brewin
the question, "who runs the police system in this country, the commissioner of the RCMP or the Solicitor General" that one would, looking at the evidence, have to say that it is the commissioner of the RCMP, rather than the person appointed by the Prime Minister (Mr. Trudeau) and elected by the people to make these decisions. Everything which I have heard in the last month or so has confirmed that feeling.
There was the letter written by a solicitor general to the member for Northumberland-Durham (Mr. Lawrence) and drafted by the RCMP, which was, to say the least, not in accordance with the facts. The direct question was whether mail was being intercepted. Now, we have this question. The minister talks about a bill which he introduced and which died on the order paper, a bill drafted on the basis of an inquiry held by a judge which recommended, among other things, that the RCMP Act be amended so that its members in such a difficulty would have the same rights as any other citizen in Canada, namely to be represented by counsel. The minister is stating a fact when he says that the bill died on the order paper.
Surely if the commissioner of the RCMP knows that inquiry has been held, if he knows that a judge has recommended against a section of the RCMP Act which prevents an RCMP officer from being represented by counsel, then as my colleague, the hon. member for Regina-Lake Centre (Mr. Benjamin) suggested, what you have in such cases is a kangaroo court. If the RCMP commissioner knows that the government has accepted the recommendation of that judge and has drafted a bill, which bill has not yet been dealt with by parliament, surely the commissioner of the RCMP and senior officials of the RCMP do not need any more instructions, despite the fact that the act as written many years ago gives them the right to hold this kind of hearing in camera without the accused being represented by counsel. Surely they could have the decency and the common sense to permit that officer to have counsel there to protect his rights, as would any other citizen-


Mr. Speaker:: Order, please. I am a little worried that we are getting off the question of privilege of the hon. member for Greenwood (Mr. Brewin), and perhaps getting on to a question of the privileges of Corporal Radey. I think we have to stick with the procedural aspects of the matter before us.


David Orlikow: Mr. Speaker, I was just coming to that, although I think what I have said is germane to the question.
The hon. member for Greenwood has said that the charges Corporal Radey is being tried on have to do with the fact that, he was instructed not to deal with the counsel for the Laycraft commission. I listened carefully to the Solicitor General (Mr. Blais). It seemed to me that he talked all around the question and tried to suggest that the charges were something else altogether, but he did not say that they were not, because I presume he realizes that eventually the nature of the charges will become public knowledge. The minister would not want to be accused of himself misrepresenting the facts.

Surely it is wrong for the RCMP or any other agency of government or any other individual to exert pressure, legal, moral or any other, on any person in Canada, particularly a police officer, so that they would not give whatever information they had to a duly constituted royal commission in this country. It seems to me that is the issue. If in fact that is what happened-and the minister has not said it has not happened-if the superintendent or senior officer of the RCMP instructed or directed an RCMP officer not to give information which he had to a duly constituted royal commission, then it is not Corporal Radey who should be on trial but the officers of the RCMP.
I hope that the Solicitor General will take this matter more seriously than he seems to have done, and I hope he will stop the practice which, I think solicitors general have had for so many years, of simply taking the word of the RCMP that what they have done is proper, correct, legal, and everything else. 1 hope he will look at the role of the RCMP and see that it deals with the problems it faces on a proper, legal, and moral basis, which in my view it has not done in this case.


Mr. G. W. Baldwin (Peace River):: Mr. Speaker, my comments will be brief. I have taken the matter quite seriously. I have come into it completely fresh as I did not know what the facts were. But I listened very carefully to the minister and to the hon. member for Greenwood (Mr. Brewin). The response contained in the letter read by the minister would suggest to me that it was calculated-I do not say deliberately-to set at rest the agitation, the anxiety of the hon. member for Greenwood, who is disturbed about this issue and quite properly so.
I am concerned here about the issue involving Corporal Radey and the RCMP. I think, as Your Honour has pointed out, that has probably decided our terms of reference.
We hear a lot of talk about ministerial responsibility. The Prime Minister (Mr. Trudeau) has used that phrase quite frequently with regard to the right of the Privy Council and the Prime Minister to be the final arbitor of what shall be the scope of disclosure of documents, for example, in the McDonald royal commission. Ministerial responsibility should be at its highest level in this House. If I, the hon. member for Greenwood, or any of my colleagues on either side of the House, seek to ask a question, and it is then indicated that a letter will come in reply, we are entitled to accept the words in that letter at face value. I am sure the hon. member for Greenwood, receiving that letter, decided not to proceed any further with the matter because of the contents of the letter. I would have been in exactly the same position, saying "this is a good response. It settles my doubts and I am not going to proceed with it any more."
If that is ministerial responsibility, and I am not suggesting nor would I be allowed to suggest that the minister did this deliberately-he wrote this letter on the basis of what was put before him-then this is a sad commentary on this principle of ministerial responsibility.
How can we accept in this House such comments contained in a letter-not the kind of answers that come on the spur of
November 7, 1978

the moment, in the heat of debate or the cut and thrust of question period, but comments made carefully and deliberately in a letter, calculated to respond to what the member had asked about this very serious issue?
Your Honour may decide the matter does not warrant being taken to a committee, but I think it is a very valid and legitimate complaint which could affect all of us in this House.


Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I will be very brief because the hon. member for Peace River (Mr. Baldwin) put the facts as I would have put them to you.
I am speaking from memory now and I may be wrong, but I believe a writ of prohibition was granted against proceeding with those charges by the Federal Court. I believe Mr. Bill Gill, QC, of Calgary, appeared in Federal Court. Whether that has anything to do with the facts as set out by the minister or the hon. member for Greenwood (Mr. Brewin) I do not know, but I felt it my duty and my responsibility, being in the House now and hearing this matter argued, to bring this to your attention.


Mr. Bob Rae (Broadview):: Mr. Speaker, it is with some hesitation that I speak on this matter, not only because of my relative inexperience in the House but also because 1 was not sworn in at the time the original question was asked by my colleague, the hon. member for Greenwood (Mr. Brewin). I agreed to second his motion, however, and therefore 1 feel I should speak on the matter.
The letter which was addressed by the Solicitor General (Mr. Blais) to the hon. member for Greenwood raises very serious questions about the frankness with which questions are being answered in this House. The hon. member for Greenwood asked a question of substance dealing with the rights of a member of the RCMP in relation to an inquiry which was going on at the time. I understand the charges against Corporal Radey relate directly to his involvement in the Laycraft inquiry. The minister is as aware of those facts as we on this side of the House; in fact he is even more aware of them than we are.
It was at this point that the minister wrote the letter to the hon. member for Greenwood, to which the minister has referred and which will be put before the committee. The only conclusion one can draw from the letter on its face is that the charges being laid against Corporal Radey have nothing to do with the Laycraft inquiry. That is the prima facie reading of the letter. If that is not misleading, I do not know what it is. It is a fine point Mr. Speaker; it is a fine lawyer's point to say this letter does not specifically say that, but nevertheless it leaves that distinct impression because of what the letter omits to say and because of what it covers by its language.
To give you one example, the letter specifically refers to the fact that the allegations against Corporal Radey relate to the fact that he failed to obey the lawful command of his superior. Are we not then entitled to ask what the lawful command of his superior was? As I understand it, and I stand to be corrected, the lawful command of the superior was that the corporal involved should not speak to any commission counsel,
Privilege-Mr. Brewin
even the counsel for the commission itself. That is not mentioned in this letter.
I think that when a member of parliament such as my colleague, the hon. member for Greenwood, raises a question in good faith with respect to the rights of an individual charged by the RCMP, he is entitled, in a letter, certainly something written after some deliberation, to something which is completely frank and open, not something which is, with great respect, devious and dissimulatory at its best.


Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I would hope that this particular matter would induce the Solicitor General (Mr. Blais) to be a little more forthcoming in the type of explanation he gives in the House to avoid this type of situation. If he had been as forthcoming with the hon. member for Greenwood (Mr. Brewin) at the relevant time, we would not be in this situation. I cannot help but remind him and the House that in 1976 when I asked his predecessor why they had the same people investigating l'Agence de Presse Libre du Quebec break-in who did the break-in, everybody more or less shrugged their shoulders. The minister at that time did not see fit to elucidate the matter in the House.
It seems to me that what the Solicitor General has been doing, and which is causing this problem, is that he has not been forthcoming enough in the House. He could easily have made available to the hon. member for Greenwood, who is a very intelligent legal counsel, some of the background documents. The case was being tried in Ottawa, and documents were around. While I do not know whether Your Honour will find a prima facie question of privilege, I would hope that in dealing with the matter that you would urge the Solicitor General to refrain from this specious doctrine. Every time a question is asked having anything whatsoever to do with police matters, he is using the coy doctrine of brushing it aside on some imagined ground of national security or super confidentiality. Surely matters of police and security are of vital concern to members of the House and, by the very nature of the subject, require complete and full disclosure by the minister.


Mr. Ray Hnatyshyn (Saskatoon-Biggar):: Mr. Speaker, 1 was moved to participate in this debate by some of the comments made by my seatmate, the hon. member for Peace River (Mr. Baldwin), who pointed out quite accurately that there are two points involved here. One is the question as to whether or not the letter itself can be considered as part of a proceeding of the House so that it would be within the purview of your jurisdiction. I think he has dealt with dispatch with that particular excuse, if it may be termed an excuse, quite well. The fact is that it was something which flowed out of the exchange in the House during question period. It was part of the response to be given to the hon. member for Greenwood (Mr. Brewin) as a result of questions raised in this House.
To put it into perspective, I think the issue is simply this. If it was a clear case that a minister of the Crown in answering question in this House lied, that he gave a falsehood knowing

November 7, 1978
Privilege-Mr. Brewin
it to be false-and I am not suggesting for a moment that that is what the situation is here-but if he did that, sir, you would be entitled to find, if you were able to determine that was the fact either by admission or otherwise, it would be the basis for a prima facie case of privilege, and then it should be investigated. I do not think there is any question about that.
I think the next step down the road must be: can the minister, under our system of ministerial responsibility, continue as has been the practice now which has developed over the past few years, can he, and may he indeed, according to our parliamentary tradition, fail to accept responsibility and not have this matter looked into, not on the basis that it is a lie with malice or forethought and so on, but somehow that the information given to them was false? I can give you a number of instances, sir, where that same argument has been brought up over and over again, unfortunately by members of this particular administration. The Minister of Supply and Services (Mr. Goyer) on two different occasions, to my recollection, used that same doctrine that, while the information he gave he thought to be true, it was based upon misinformation given to him either by somebody in his office or a departmental employee.
I say to you, sir, that it is not good enough for the Solicitor General to stand in this House and suggest that there was a misunderstanding by him on the basis of information given, if that is what he said, or rather that he got information provided to him which tended to mislead the hon. member for Greenwood. 1 think the matter should be investigated because it is a fundamental question of ministerial responsibility. I simply submit, sir, that as I understood the excuse of the Solicitor General, it should not be enough to discount the matter, and for you to overlook it, but rather we should have the matter investigated to determine precisely what we mean in this House by ministerial responsibility and ministerial accountability to this parliament.


Mr. Speaker:: Order, please. I have given very careful attention to the question of privilege raised by the hon. member for Greenwood (Mr. Brewin). As he will be aware, I have directed my attention already to many of the principles that have governed this question. They have been argued in a similar way, although in much different circumstances, only a few days ago in the question of privilege to which reference was made often this afternoon, raised by the hon. member for Northumberland-Durham (Mr. Lawrence).
However, there is one very important difference that I am sure all hon. members will recognize in this instance over that other case. There are several differences, but one is quite fundamental to our procedure. That is to say, in his intervention today the Solicitor General (Mr. Blais) did not in any way alter or change the content of his reply, or in any way indicate that he was dissatisfied with the reply he had given on an earlier occasion. In other words, in his intervention today he said, "Having had the question of privilege brought to my attention, I reviewed my reply. I stand by it; it is the reply I made at the time. It was on proper information at the time, and it is the reply I should have made under the circumstances

at that particular time." Now whether that is right or not, it is not for me to judge. I am not the one in this situation to judge the accuracy of the facts involved.
I am certain there will be considerable disagreement, and interesting discussion is possible as to whether or not one side has merit or the other side has merit in these particular circumstances. However, that does not alter the basic fact that a question of privilege is essentially a procedural argument, and, once the minister has said that this is the reply he intended to give, and upon reviewing his information, he feels that it is the proper reply in the circumstances, it seems to me that that takes it out of the area of procedure and perhaps puts it into an area of debate or may raise it into the area of other remedies. Once the minister stands in his place and says "I have reviewed the reply, that reply was accurate and proper," I am bound to accept that, and the House is bound to accept that, no matter how violently the House may disagree with the interpretation the minister puts on that. It may pursue that violent disagreement another way, but in any case that seems to me to take the matter entirely out of the question of procedure and leave it in the realm of debate and disagreement, which is a different matter altogether.
Therefore, with that fundamental difference in mind, I really do not think at this moment, on the information that has been put before me today, that I can pursue this matter as a question of privilege.



ROUTINE PROCEEDINGS


[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Yvon Pinard (Parliamentary Secretary to Deputy Prime Minister and President of Privy Council):: Mr. Speaker, the following questions will be answered today: Nos. 67, 164 and 279. I ask that the remaining questions be allowed to stand,


Mr. Beatty: 1.	On the weekend of February 3, 4 and 5, 1978, did the Minister of Labour use government aircraft to fly to Vancouver and other places in Western Canada to convince owners of Canadian Football League teams to block the sale of the Hamilton Tiger Cats to Mr. Harold Ballard and, if so (a) what was the cost to the taxpayer for the minister's trip (b) who were the other members of the minister's party (c) in what way did the trip to western Canada relate to the official duties of the minister?
2.	Does the Minister of Agriculture intend to make a grant to the owners of Ivor Wynne Stadium in Hamilton to cover 90 per cent of the cost of new seating as urged by the Minister of Labour and, if so (a) from what existing fund, if any, does the Minister intend to make such a grant (b) is the Minister of Agriculture and/or the Minister of Labour reconsidering making the grant in view of the fact that Mr. Ballard now owns the Hamilton Tiger Cats?
November 7, 1978


Yvon Pinard: 1. See
Beauchesne's Parliamentary Rules and Forms, citation 171
(11).
2.	The Minister of Agriculture has not received an official application for assistance from the owners of Ivor Wynne Stadium in Hamilton. Any decision to assist this or any other project in the Hamilton area will be judged on its merits in line with service to the community and the general context of loans made to agricultural societies.


Mr. Roche: 1.	Was a contract for $10,000 awarded on behalf of the Department of External Affairs to S. Freifeld, 606 Churchill Avenue, Ottawa, Ontario, to screen restricted files in Ottawa?
2.	What is the nature of the files?
3.	Is this sort of work usually contracted out and (a) if so, for what reason (b) if not (i) for what reason (ii) for what reason is an exception being made in this instance?
4.	What qualifications does one have to have to screen the Department's restricted files?


Mr. Louis Duclos (Parliamentary Secretary to Secretary of State for External Affairs):: 1. Yes.
2.	Restricted files for the period 1950-1963 on Canada's relations with the United States, Federal Republic of Germany, Italy, The Netherlands and Middle East.
3.	Yes. (a) In order to utilize the expertise and experience of former senior officers of the department in determining whether previously restricted material has in the interval lost its sensitivity, thereby allowing its release to the public without endangering the conduct of Canada's international relations.
4.	A thorough knowledge of the file subjects being screened, and their relationship to current international issues, plus a valid security clearance permitting access to restricted files.


Mr. Cossitt: 1.	To the knowledge of the government, how many motor vehicles were licensed to the Embassy of the Soviet Union or to the employees in each of the past five years?
2.	Does the government and specifically, the Department of External Affairs, have an up-to-date list of such vehicles and, if so, what is the current license plate, registration, etc. of each vehicle?


Louis Duclos: 1. License plates for automobiles owned by the diplomatic, consular and foreign-based administrative and technical members of missions are issued by the provincial authorities. The list of the plates issued in Ottawa is sent every year to the Department of External Affairs. It is not however kept from year to year.
2. The following has been extracted from the 1978 list received from the motor vehicle bureau (Ottawa) of the ministry of transport and communications of Ontario:
Order Paper Questions
Motor Vehicles Licensed in 1978 in Ottawa to the Embassy of the Union of Soviet Socialist Republics or to the Employees
Owner	Licence Plate	Colour	Make	YearAmb. Yakovlev	CDA-088	(black)	limousine	1977Amb. Yakovlev	CDA-188	(black)	Pontiac	1977B.A. Soukharev	CDA-222	(silver)	Chevrolet	1977Embassy	CDA-223	(beige)	Chevrolet	1977Embassy	CDA-224	(blue)	Chevrolet	1977Talanov	CDA-225	(brown)	Chevrolet	1977Danilinive	CDA-232	(blue)	Chevrolet	1978Souvorov	CDA-233	(blue)	Pontiac	1977Ivanov	CDA-234	(red)	Chevrolet	1977Borishpolets	CDA-235	(blue)	Pontiac	1977Embassy	CDA-236	(brown)	Pontiac	1977Embassy	CDA-237	(blue)	Chevrolet	1977Skofenko	CDA-238	(yellow)	Fiat	1975Vartanian	CDA-239	(blue)	Pontiac	1978Meechulayev	CDA-240	(blue)	Chevelle	1977Enguibarov	CDA-241	(yellow)	Chevrolet	1978Enguibarov	CD A-242	(brown)	Mercury	1977Enguibarov	CDA-243	(red)	Chevrolet	1978Enguibarov	CDA-244	(red)	Buick	1978Enguibarov	CDA-245	(tan)	Plymouth	1978Embassy	CDA-246	(silver)	Pontiac	1977Enguibarov	CDA-247	(beige)	Chevrolet	1978Embassy	CDA-248	(blue)	Chevrolet	1977Krioutchenov	CDA-249	(silver)	Pontiac	1977Aleksansan	CDA-250	(blue)	Chevrolet	1978Embassy	CDA-251	(tan)	Chevrolet	1978Plavinski	CDA-252	(blue)	Chevrolet	1977Movikov, Alex	CDA-274	(blue/green)	Chevrolet	1977Press Office	CDA-282	(blue)	Chrysler	1977Embassy	CDA-283	(yellow)	Chevrolet	1978Embassy	CDA-284	(blue)	Chevrolet	1978Embassy	CDA-285	(blue)	Chevrolet	1978Plavinski	CDA-286	(red)	Plymouth	1978Embassy	CDA-287	(beige)	Chevrolet	1978Press Office	CDA-288	(red)	Plymouth	1978Embassy	CDA-294	(brown)	Pontiac	1978Krioutchenov	CDA-295	(silver)	Pontiac	1978Bragin	XTR-013	(black)	Pontiac	1977Palladin	XTR-004	(silver)	Ford	1978
Total: 39


Mr. Speaker:: The questions enumerated by the hon. parliamentary secretary have been answered. Shall the remaining questions be allowed to stand?


Some hon. Members:: Agreed.

November 7, 1978
Point of Order-Mr. McGrath



POINT OF ORDER


Mr. James A. McGrath (St. John's East):: Mr. Speaker, before orders of the day are called, I want to raise a point of order which I hope will not overtax your seemingly infinite patience, because we have had a number of procedural points of order raised in the House in the last couple of days. I am sure this point of order will commend itself to Your Honour because of the difficult if not impossible position in which it places the House.
The next order of government business calls for the House to go into committee of the whole to consider Bill C-10. The problem I want to put before you, Mr. Speaker, arises from the fact that as of this moment, 3.30 this afternoon, we have meeting the following standing committees of the House:
The first is the Standing Committee on Finance, Trade and Economic Affairs. That committee happens to be dealing with a finance bill which is keeping the Minister of Finance (Mr. Chretien) out of this House on a bill for which he has responsibility in this House, namely, Bill C-10, an act to amend the Income Tax Act with regard to family allowances. I could base my whole argument on that fact alone, but there are other committees meeting this afternoon as well.
There is the Standing Committee on Labour, Manpower and Immigration. A number of people on that committee, two for sure, have a special interest in Bill C-10 which the House is now considering in committee of the whole, but feel they have to be at that committee meeting this afternoon. As well, we have the Standing Committee on Broadcasting, Films and Assistance to the Arts meeting later this day, as well as the Standing Committee on Veterans Affairs.
I raise this at this time because the House will be dealing later today or on Thursday, as the case may be, in committee with amendments. This will tend to dramatize the dilemma in which the House finds itself.
First, there is the paradox of the House sitting in committee of the whole. That in itself would seem to exclude any other committees meeting at that time. When the House is in committee of the whole, that by definition seems to exclude any other meetings of committees of this House. The fact is there are committees of the House meeting today and will be meeting on Thursday while the House is in committee of the whole on a very important bill.
The problem is that when there are votes in committee of the whole there is no division bell. There is no way to alert members attending to their duties in committee that there are important votes taking place in the House. I submit this question should be of some importance to the government because the gap between the combined opposition and the government is closing as a result of the recent by-elections.
I have raised this matter before. I refer Your Honour to the House of Commons Debates for Monday, February 22, 1971, at page 3601. Apart altogether from the fact that we are

thwarted in our efforts to be able to direct questions to the Minister of Finance on an important bill dealing with the Income Tax Act because the minister is present at a meeting of the Standing Committee on Finance, there is the fact that members are precluded from attending to their duties in committee of the whole with respect to divisions that may take place, and probably will take place. I anticipate there will be amendments to this bill. Therefore this is a problem with which the Chair should certainly be seized.
I realize what is going through Your Honour's mind at the present time, that there is nothing in the standing orders to cover it. That happens to be the case. However, when we did away with the committee on supply and established standing committees of the House to deal with supply and legislation, that reduced the number of times the House was in committee of the whole. I do not believe it was envisaged at that time that committee of the whole would be competing with standing committees of the House either on questions of supply or on questions of legislation, as is the case we are faced with this afternoon. I leave that with Your Honour.
I raised this last night when we got on to this bill. The Standing Committee on Finance, Trade and Economic Affairs was meeting last night at a time when we were in committee of the whole on Bill C-10. That committee was hearing evidence from the Governor of the Bank of Canada and the Minister of Finance on another important finance bill. That placed the House of Commons in an impossible position, one which was never intended by the rules.
I submit with great deference that this is a situation where Your Honour should intervene. 1 leave it at that, and hopefully the Parliamentary Secretary to the Deputy Prime Minister and President of Privy Council (Mr. Pinard) will bring this to the attention of the government House leader and, if we are seized with the question on Thursday, Your Honour will be able to deal with it.


Hon. Monique Begin (Minister of National Health and Welfare):: Mr. Speaker, I listened to the point being made by the hon. member for St. John's East (Mr. McGrath). I think it is fair to point out that the meeting of the finance committee last night was requested by the hon. member for York-Simcoe (Mr. Stevens), who at the same time decided to be in the House to accuse us of not having the Minister of Finance (Mr. Chretien) here. Surely the opposition has a responsibility in this.


James Aloysius McGrath: It is unfortunate that the bill is being dealt with in his absence. Elowever, I repeat that the Minister of Finance is willing to come here as soon as he has finished with the finance committee which is his first responsibility. I am piloting the bill as co-sponsor.


James Aloysius McGrath: His first responsibility is to be here.


Monique Bégin: The opposition members should make up their minds. They do not know what they want. They should not play games with this bill.


Leslie Gordon Benjamin: Mr. Speaker, the minister entirely misses the point. I support completely what the hon. member for St. John's East (Mr. McGrath) has said. This is not the first time this has happened. In fact while Your Honour was in the chair, and on one or two occasions when your predecessor was in the chair, members moved the adjournment of the House, a procedure which very soon stops meetings of committees and forces a vote.
The government should have the brain capacity to arrange that when the House is sitting in committee of the whole, standing committees do not meet. Surely a committee of the whole House has some priority over several standing committees meeting at the same time. The government chose to have this legislation dealt with by committee of the whole. Therefore standing committees should not be meeting at the same time.
Why were the committee meetings called? Some were called for organizational purposes and some of us should be at them. Some members will not be there because we have given this chamber priority while the House is sitting in committee of the whole. There are clauses members want to speak on, or vote for or against. The bells do not ring. How can you possibly attend a standing committee meeting in another building and at the same time take part in a committee of this whole House, something which should have priority?


Mr. Alan Martin (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, I do not want to get into the generalities of this discussion on the point of order raised by the hon. member for St. John's East (Mr. McGrath). However, I would like to deal with the particulars he mentioned.
First, may I again clarify the situation with regard to last night, as I did when the hon. member for St. John's East raised it last night. Indeed, the reason there was a meeting of the Standing Committee on Finance, Trade and Economic Affairs last night was because it was specifically requested by official opposition members on that committee, led by the hon. member for York-Simcoe (Mr. Stevens).
There was no intention of having a meeting last night. As I indicated in the House last night, it was foreseen to be a problem to both sides of the House if that committee were to meet. However, in order to accommodate the official opposition and the official opposition finance critic, the chairman of the committee, the hon. member for York Centre (Mr. Kaplan), decided to go ahead with the meeting.
Family Allowances
As for the meeting today, the only reason the Minister of Finance is at the meeting of the Standing Committee on Finance, Trade and Economic Affairs and not in this House is that the official opposition, again led by the hon. member for York-Simcoe and, I believe, by the Leader of the Opposition (Mr. Clark), insisted that there be three successive meetings. The meeting of today was not set up by the government. It was set up by the standing committee, as are all standing committee meetings. That meeting was set up some time ago, and it is a coincidence, unfortunately, that we are still sitting here in committee of the whole considering an item of social legislation which I believe at least some hon. members opposite support and want to see passed.


Mr. Speaker:: There are two others who want to contribute. In essence we are discussing a point over which I have no control. I think there is, therefore, a limit to how far we can go.
There have been contributions from both sides regarding the scheduling of meetings. Perhaps the point is properly raised. It is an advertisement to those who organize and agree upon the organizing of the scheduling of these meetings that perhaps more care should be taken to avoid conflicts. However, in the final analysis I do not have the power to arrange the scheduling of meetings or to cancel meetings, so therefore in the end, if the conflict cannot be resolved in the way which has been suggested this afternoon, there is nothing I can do about it.


Gerald William Baldwin: Mr. Speaker, I rise on a point of order regarding a statement made by the parliamentary secretary. I want to contradict his statement because of facts set out in the proceedings in this House last night.
At page 853 of Hansard the hon. member for York-Simcoe (Mr. Stevens) is reported to have said:
Mr. Chairman, I rise on a point of order. I do not want to delay to committee, but I cannot allow the parliamentary secretary to go misinformed. The fact is we were put under a guillotine with regard to Bill C-7. I said initially we could hear Governor Bouey of the Bank of Canada. The governor informed us today that the only time he could be here was at eight o'clock tonight, because he goes to Vancouver tomorrow. I said we would not be difficult and if we could accommodate him tonight at eight o'clock, we would.
I think that should be on the record because it is not in accordance with what the parliamentary secretary said.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Monday, November 6, consideration in committee of Bill C-10, to amend the Income Tax Act
[Stage Direction]
November 7, 1978
Family Allowances
to provide for a child tax credit and to amend the Family Allowances Act-Mr. Chretien-Mr. Laniel in the chair.
The Chairman:: Clause 1 is under consideration.
On clause 1 -


Alan Gray Martin: Mr. Chairman, if I may, I would like at the outset of our proceedings today to amplify one or two points which were raised last night. The hon. member for York-Simcoe pointed out that 1.9 million families will gain as a result of this legislation, and 1.7 million will lose. That adds up to 3.6 million families. The hon. member then stated that taxation statistics show that only 1.7 million tax filers reported family allowances. In fairness to the hon. member for York-Simcoe, he may inadvertently have misread the taxation statistics which show that some 3.3 million tax filers reported $1.7 billion in family allowance benefits. In addition, there are about 300,000 poorer families who receive family allowances but who do not file tax returns.
Another point I would like to clarify is in relation to a request made by the hon. member for York-Simcoe for information on the financial implications of the proposed child benefit changes over the next four fiscal years. I indicated last night that indeed it is not a common practice in the House to provide revenue and expenditure projections beyond one fiscal year, but I should like to assure the hon. member, and all members of the House, that child benefit changes will be more or less self-financing in 1979-80 as well as in future years.
The expenditure savings through reductions in family allowance will remain constant in real terms over the course of time. The real value of child tax credits will also be maintained through indexing. Tax savings resulting from changes in exemptions for children aged 16 and 17 will also grow in line with inflation. Therefore the net impact of the proposed changes on financial requirements will really be marginal. The absolute dollar magnitude of each of the individual measures would depend upon the rate of inflation, incomes, and population growth, as well as other factors, as I indicated last night. I am not in a position to provide this breakdown beyond 1979-80.


Ramon John Hnatyshyn: Mr. Chairman, at this stage of the consideration of the bill I should like to raise with the minister, who is now answering our question, some of the concerns which I think have been enunciated in a number of areas but which have been brought into focus in a press release which was recently sent out by the National Anti-Poverty Organization. I am not sure whether the minister has had an opportunity to see that press release today, but this organization, of which, I am sure, the minister is aware, has raised some very legitimate question with respect to the effect of this legislation on an unfortunately large element of our society, namely, the poor. I want to put some of these questions to the minister at this time in the hope that she will be in a position to give us some information and guidance on some of the points that are raised in the press release, and then perhaps the minister will
be in a position to answer the points at the conclusion of my remarks.
One of the points raised by the organization is with regard to the method of paying the refundable tax credit in one lump sum. The organization points out that this could adversely affect welfare recipients' cheques, depending on how individual provinces view this tax credit. The organization points out that welfare recipients are also restricted as to the amount of money they may have in the bank, so it may prevent them from saving money. So the organization does not know what effect this will have on provincial programs such as GAIN in British Columbia, or on GIS payments to the elderly. It points out that there are many senior citizens who receive family allowances.
It is suggested in the press release that an option to permit quarterly payments would benefit some, while still allowing others to receive a lump sum payment which would give them the money they would need to make a major purchase. People who choose to have quarterly payments could use it to coincide with school vacation, the start of school, Christmas, etc.
The organization goes on to point out that the new benefit is of concern to NAPO because of lack of consumer protection, affordable financial counselling services, and the need for legislation to prevent exploitation through the policing of tax rebate discounting. This point has been raised on previous occasions-as I know from having heard it in the House and from reading Hansard-by many of my colleagues in the House. I would simply like to point out to the minister again this concern of the organization.
There is another interesting point whch the organization raises, that is, that there are some groups of people for whom no policy has as yet been established. The organization refers to foster children, for example. For some foster children, it states it has been the policy to place family allowances in trust for their future. This income will now be reduced. The organization feels that losses sustained by these children should be compensated.
The minister will remember that during the question period I raised some questions with respect to social insurance numbers. NAPO makes some observations with respect to that.


Bob Rae: Living in SIN.


Ramon John Hnatyshyn: Living in fear of SIN would be the more appropriate phrase. The fact of the matter is that status Indians and the Inuit, as is pointed out by NAPO, are not required to pay income tax. There are many other Canadians who do not require a social insurance number at this time. The organization, therefore, questions whether or not these people will qualify for the refundable tax credit and whether the obtaining of SIN is a prerequisite for participation in this scheme. Another question in the whole debate about social insurance numbers is where precisely status Indians and the Inuit fit into the scheme.
The minister has told us on a number of occasions, both in the House and privately, that although she has no direct


responsibility for SIN, she is interested in the operation of this bill which she has taken upon herself to guide through the House as one of the co-sponsors. So I hope the minister can answer some of the questions that are raised here and can let us know how the government intends to operate this scheme in so far as status Indians and the Inuit are concerned.
The organization makes a technical point about children born in November who have reached the age of 18 and are not eligible for the tax rebate, while those born in December who have reached 18 reap a double windfall by qualifying for the tax credit and a higher exemption. Here I wonder what the minister's attitude would be toward the suggestion of the organization that a more equitable solution would be to allow parents of all 18-year olds to qualify for a portion of the rebate, or one-twelfth a month.
Finally, one of the most important questions they raise, as they put it, concerns lack of information regarding this program. The organization states in its press release:
We feel an all out program must be instituted to inform family allowance recipients of their entitlement and what they have to do to get it. We have also recommended to the Minister of National Health and Welfare that the outside of family allowance envelopes containing the statement of income form be marked with a special warning not to throw it away. We also recommend post offices keep a supply of extra forms together with income tax forms usually available there.
The point the organization is making is that there is a great number of people who will possibly be entitled to benefit from this program who should have more information regarding the availability of those benefits.
The minister has explained that the whole process will go through some kind of giant sophistocated computer in the department so that if the computer works properly, so will the system. But the initial concern, of course, is that those people who might be entitled to the benefits, who qualify for them- they are the most vulnerable in our society-might not be aware of this program because they do not follow the proceedings in parliament on a daily basis, do not read Hansard and do not necessarily read the newspapers. I would be interested to know from the minister what plans the department has to inform those people of the availability of benefits.
Those are the concerns expressed by the National Anti-Poverty Organization-


James Aloysius McGrath: And the official opposition.


Ramon John Hnatyshyn: I do not even have to add that they are also the concerns of the official opposition, because it is known that these concerns, based on compassion, have been raised very articulately by the hon. member for St. John's East and the hon. member for Kingston and the Islands, who are concerned about giving the best effect to the plan, which the minister is now introducing in the House.
I think these are legitimate questions which require some explanations, some elucidation and enlightenment from the minister so that we can be sure that the plan as presented by the government at this time will be as effective as possible.
Family Allowances


Monique Bégin: Mr. Chairman, I think I have enough information with me right now to enable me to answer all the points raised by the hon. member for Saskatoon-Biggar. Of course I am aware of the press release put out by NAPO. My last meeting with them was held on October 16 during which we discussed the proposed bill at length. Whenever I have had a chance to be in another Canadian city in the last two months, I have made a point of meeting the local associations which are members of NAPO and, which represent those whom we want to help on a priority basis. Therefore, I can repeat here what I said to them.
The question of the annual payment which might eventually affect people adversely if provincial governments do not pass on the new allowance in its entirety to families, is one on which I have spoken often in the House and, I have stated what we have done. I want to stress in particular that older people receiving family allowances for their children, or for children whom they have in legal custody, will not be penalized under GAIN. I have said that often. The hon. member was probably absent from the House. The province of Ontario as well as the province of British Columbia have confirmed that. Therefore, the new child tax credit will not be considered as income. I can assure the hon. member that that applies also to veterans' programs and other programs. There is no problem on that front. I am still awaiting a reply from my provincial colleagues with a formal commitment. 1 have received it informally more than once, but I want a formal commitment that they will pass it on and that provincial governments will not recover that money either directly or indirectly.
The second point which the organization made, and which is particularly valid in the western part of the country, is the social problem of tax discounters. I have spoken in the House on the matter of tax discounting, but this will permit me to make my views public once more. I will do everything I can, in terms of making it known, to discourage mothers from cashing in their anticipated credit ahead of time. Under the new bill passed by the House a few months ago, no tax discounter can take more than 15 per cent of the child tax credit, including interest and other charges. However, some mothers might decide they want 85 per cent of the credit ahead of time. I will discourage mothers from doing so, and I hope to have the help of all hon. members in that. The abuses we have witnessed in the past, particularly in British Columbia, will I hope, be under control when this provision on child tax credit is in effect.
The third point referring to the need for information is a point which I would like to reserve for the end.
The fourth point deals with the treatment of foster children, in other words, children placed in foster homes, who do not receive family allowances. Let me give hon. members a legal answer. Those children receive a special allowance, similarly to children placed in institutions. That special allowance will be continued and is not diminished. Not only will it be $25.68, but with the indexation it will amount to $28.80 as of January. I think this answers the fourth point raised by the hon. member.

November 7, 1978
Family Allowances
The fifth point referred to SIN, which is something I discussed with the hon. member privately. The hon. member wants to know where it is going to stop. He referred to the eventual abuses of the use of SIN. Apparently some ambiguity concerning this infiltrated our debates in the last weeks. The hon. member for Saskatoon-Biggar several times indicated that he was not pleased with some of the things we were going to do. We are going to implement a new child tax credit, but by my reading of the press I conclude that his fears were not associated with that. He was concerned about the penalty on cashing bonds or other financial assets without providing social insurance numbers to the taxation people.
It is a requirement of the Income Tax Act that social insurance numbers be provided. Sections 234 and 237 provide for that requirement, and for the penalty. The hon. member referred to the penalty clause which is contained in a law passed by the House.
The child tax credit provision is a use of the taxation system. In that system people are required to obtain social insurance numbers by law. Mothers who do not have social insurance numbers will be invited to apply for one. We in the department have observed that a great number of mothers who have submitted social insurance numbers have given us their husbands' numbers. Possibly they have done so because of the practice established by credit card companies where wives use their husbands' credit cards. We invite people who do not have social insurance numbers to apply for them. They can go to post offices to pick up application forms which must be filled out.
The sixth point raised a question regarding Inuit and Indian children. We have not had an opportunity to clarify that yet. Clearly these children have the same rights as other Canadian children. Therefore they will receive, through their mothers, the new child tax credit. One must remember that the child tax credit uses the taxation system, under which Indians do not file. In this case it was clearly decided that Indian mothers will apply in the same manner as other Canadian mothers and will receive the credit for their children.
Some benefits and tax privileges are prorated in the tax system. Others are given as per status on December 31 of the tax year. The child tax credit will go to children who are below 18 years of age as of December 31 of the tax year for which people are filing.
The last point is a very important one. It concerns the needed information campaign to make sure all eligible mothers apply for and receive the benefit. Of course this applies more to mothers on welfare and working mothers of poor families who do not pay taxes, or are in no way related to the tax system. There are hundreds of thousands of such people. We are making maximum use of cheque inserts. There was one in October. There will be one in December and in January, together with the one-page new form. Also there will be one in February. In addition, we intend to have a special mailing to all family allowance recipients who do not have social insurance numbers. This special mailing will instruct them on how to receive their numbers.
I have written to all my provincial colleagues asking for their assistance in permitting social workers or professional field staff to assist all the people they meet in their daily work. Since most of these people are on social assistance programs, they will be provided with the required assistance in filling out forms. I would welcome suggestions from members of the House as to using voluntary organizations which are connected with women. I am referring to such organizations as those fighting poverty and to other women's organizations. They could be of assistance in the establishment of an information program. Also we are training our own field staff in every income security office in the country. In addition to their training on GIS, they will be trained to assist mothers and parents in general in filling out forms in January, February and March. I stress the importance of getting the mothers, particularly of families in need, to apply for this program.


James Aloysius McGrath: My question arises out of those posed by the hon. member for Saskatoon-Biggar, but first I should like to clear up a misconception which was placed on the record by the Minister of National Health and Welfare when I raised a point of order. She accused us of playing games with this bill. 1 am sure she was implying that some kind of a filibuster was taking place. Nothing could be further from the truth.
The record will show that we first received this bill in committee of the whole on Thursday, November 2. On that occasion we had two hours to deal with it. On Friday, November 3, we were provided with one hour and 40 minutes in which to debate this bill. Yesterday, because of the procedural debate brought on by the government House leader, we were provided with approximately 30 minutes. Thus, we have spent a total of four hours on this very important bill, which is the equivalent of less than one day. The minister should not throw out irresponsible accusations of that kind. If anyone is playing games, certainly it is the government, as evidenced by the procedural argument of the government House leader yesterday and the failure of the Minister of Finance to be present in committee to answer questions on this bill for which he has responsibility.


Some hon. Members:: Hear, hear!


James Aloysius McGrath: The minister made replies to my colleague respecting no formal agreement or undertaking by the provinces regarding this bill, and that perhaps it stands a chance of being discounted respecting social welfare payments paid by the provinces.
I should like to refer to the case of my own province. This bill was brought in coincidental with a bill now before the House to amend the Unemployment Insurance Act. That will mean a number of people in the Atlantic provinces and other parts of the country who heretofore would qualify for unemployment insurance, will now have to fall back on the overtaxed welfare agencies of our provinces and cities. The absence of a formal agreement or undertaking to deduct the amount of

November 7, 1978

the tax credit from the amount payable in social welfare obviously will be irresistible to some of the provinces. When that is taken into account, together with the fact that universal family allowance payments have been decreased by the terms of this bill from $28-which would be the case in January under indexation-to under $20, then the very result of this bill could be opposite to what the minister is trying to achieve, namely, a net reduction in the total income to low income families.
Why has the minister proceeded with this bill without a formal undertaking from the provinces? We know that the provincial ministers, when they met in Nova Scotia in September, complained publicly of the fact that there had been no consultation with them on this bill. Surely, given the concern expressed by these ministers, and given the fact that the minister knew that she would be presenting this bill to the Elouse in October or November, she could have made some effort to meet with the ministers and extract from them a formal commitment that they would not deduct the amount of the child tax credit from the amount now payable under various social welfare programs by the the provinces and the cities. Would the minister tell the committee why she is proceeding with this bill without such a commitment?


Miss B6gin:: Mr. Chairman, what has been suggested in terms of a filibuster by the loyal opposition may have some truth. The hon. member did not even say that we sat on Thursday afternoon and Thursday evening regarding this bill. He missed two hours there. Then he repeats the question he asked me just the other day. Every one of these questions has been asked several times now.
The hon. member knows very well that, contrary to what the NDP say, the government has no choice in dealing with this bill other than through committee of the whole. We do not have the choice of going to the standing committee on finance. The opposition appears to be wasting time, but what they are waiting for I do not know.


James Aloysius McGrath: You don't understand the system.


Monique Bégin: The Minister of Finance will be here tonight, but the opposition does not seem to want that. The hon. member knows full well that the provinces have developed in recent years the bad habit of taking back from their citizens what is given to them through federal programs, be it old age pensions or family allowances.


James Aloysius McGrath: 
James Aloysius McGrath: The minister just doesn't understand what we are trying to do here, Mr. Chairman. First of all, she misleads the House. I would remind her that we started in committee of the whole on this bill last Thursday, and that we sat for 20 minutes before six o'clock. If the minister does not want to listen to the truth, I cannot help it.
Let me deal with what she is talking about. The minister is asking this committee to pass a bill the net effect of which will be, first, to reduce the universal amount of the family allowance by $8 as of January 1, and second, of reducing the income to low income earners in Canada in the absence of a formal commitment from the provinces that they will not subtract the amount of the child tax credit from the amount they are currently paying out on welfare. That is our concern, and it is the minister's responsibility to obtain that undertaking from the provincial ministers, not ours.
She was warned about this situation when the provincial ministers met in Nova Scotia in September, when they complained at that time that there was no consultation. She knows that the province of Quebec, which has its own family allowance plan, was not consulted, that the province of Alberta was not consulted, and that there has been no consultation with, or undertaking or commitment from the provinces that they will not in fact subtract the total amount that would be payable to a low income family under the tax credit provisions of this bill, the net effect of which will be the very opposite of what the minister is trying to do, and the result will be to reduce incomes for low income families. If she cannot give us some kind of undertaking in that regard, then she might very well have a filibuster on her hands, and rightly so.


Monique Bégin: We should not be debating in this House problems which are to do with the behaviour of the provinces. The Leader of the Opposition says that he will let the provinces do what they wish, but the member for St. John's East says that he does not trust the provinces. This government trusts the provinces. Many provincial officials have met with federal officials and told them that they will pass on the benefits. I am confident that I will receive a formal commitment from them.
We are doing this to help the people of Canada. I would suggest to the hon. member for St. John's East that if he knows anything about democracy he should write to his riding, if he will not go there, and ask the groups that represent mothers and poor families to lobby their provincial government in order to obtain something which is of provincial jurisdiction. The hon. member implies that I am linked to a provincial-federal agreement. I am not, because this is a federal program. The hon. member knows that, and it is dishonest for him to pretend that there is any link inherent between this proposal and the behaviour of the provinces. They have many ways of recovering the money if they wish. For example, they could do it through day care fees, a program classified as being under the education department, not a social program.
We must ensure that this money goes to the parents and does not become an indirect transfer payment to the provinces,

November 7, 1978
Family Allowances
but it is not a case for a federal-provincial confrontation, as the hon. member would define the situation. It is a federal program, and the government is giving it directly to Canadian families and asking them to lobby their provincial governments to make sure that their elected representatives leave it with their citizens.
If members would follow the development of social policy in this country they would know that the provinces instructed the federal government, through my predecessor two years ago, to explore tax related programs such as this one to help, on a selective basis, groups that are in need. The three groups which were identified specifically around that time as needing help were families with children, including single parent families, people between the ages of 64 to 65 who lose their jobs and can no longer work, and older people. This bill addresses the problems of one of these three groups. The provinces know that, and there is no opposition to it. We all want to see this bill passed and to make sure that it is respected by the provincial welfare programs.


Mr. Epp:: Mr. Chairman, I do not wish to interrupt my colleague, but I think it is important that we keep the record straight. The minister has given the impression that we have been sitting in committee of the whole on this bill for a long time and that they have been answering questions. I have reviewed Hansard, and on Thursday we spent approximately two hours and 20 minutes on this bill in committee of the whole. On Friday there was a point of privilege raised by the member for Northumberland-Durham immediately after question period, which went through the morning session and into the afternoon session. We started in committee of the whole at 15 20 on Friday afternoon. I was here and wanted to ask questions of the minister. That was my first opportunity. Yesterday we started at 21 25 p.m. I am simply saying that the red herring the minister pulls across the trail that she does not want to answer questions may be true, but her reading of the time is wrong.


Gérald Laniel: Order, please. I think we should drop that question. It is not the way to make progress. It is a point of debate more than anything. I will allow one last question to the hon. member for St. John's East. The hon. member for Athabasca, the hon. member for Cape Breton-East Richmond, and the hon. member for Edmonton West have indicated they want to contribute to the debate.


James Aloysius McGrath: 
Mr. Yewchuk:: Mr. Chairman, I am pleased to have the opportunity to ask the minister a few questions on this important subject. The minister claims she is very concerned about poverty and those people living below the poverty line, yet since the government of which she is a member has been in power, countless mothers live as have mothers of past generations-in a web of poverty. The policies implemented by this government over the past 15 years have not improved the situation at all.
The hidden community of the poor in this country remains in relatively the same state as it has been for some time- victims of circumstances beyond their control, victims of a totally insensitive and poorly informed government about the things that need to be done to correct poverty.
In short, Mr. Chairman, I am concerned and upset by the persistence of widespread poverty in our modern, prosperous society. Depending on which definition you use-I know the Prime Minister chooses to use the definition which makes it look better than it is, but if we take the definition of poverty used by the Senate committee, which I think is the best definition, we see that 20 per cent or more of Canadians are living in conditions of poverty.
November 7, 1978

To try to come to grips with the problem of poverty, it is crucial to understand the causes and effects of it. Contrary to popular belief in some circles, today's poverty is rarely caused simply by laziness. If we look at statistics we will realize that the greatest number of people living below the poverty line are working full time, but their full-time work does not produce enough income to meet their needs. There are loggers, fishermen, farmers and others who are seasonally employed, and then there are the elderly, the blind, the disabled, mothers of deserted families, and the young who are becoming more and more important in this category of poverty while this government is in charge. Perhaps less than 3 per cent of the people living in poverty are in that condition as a result of what might be described a laziness.
I am particularly concerned about the increasing and obvious evidence of the failure of welfare programs, which are increasingly costly and less and less effective, as weapons against poverty in Canada. That may be because the gradual development of poverty programs in this country is not guided by any over-all strategy or consistent goal. Rather, we have a jungle of programs developed in a patchwork manner, helter-skelter and unco-ordinated, and as a result nothing works.
The bill the minister has placed before the House is just another example of juggling a small patch in this patchwork of anti-poverty programs which, as far as I can tell, will do very little to come to grips with poverty. The minister has not said anything to make me believe differently.
We believe that reforms are required in the whole approach to poverty. As a party, we have stated this on many occasions in the past. Incentives need to be built into the anti-poverty program, and there is a need to emphasize the necessity of income development for individuals below the poverty line, as well as a need to assist all Canadians to develop the ability and the confidence to achieve greater income earning potential. Incentives are needed to encourage recipients to seek further employment or retraining. Programs which too often discourage such efforts must be reformed.
In the past we have spoken about an income development program the principles of which must be to create new incentives to encourage recipients to seek further employment or training; to establish a system which is fair for all those in need and perhaps re-assess completely the concept of universality. Some of these universal programs have become ineffective when applied to those in greatest need. I am glad to know the minister heard my last comment. She has spoken with liveliness and conviction of the program presented in this bill, saying that it will solve the problems of the poor. She specified particularly single mothers and elderly individuals.
If we look at the statistics again, we note that the poor have become poorer while the rich have become richer, and the gap is ever and ever widening. I want to ask the minister some questions in this particular regard. We know for example that in 1951 the lowest 20 per cent of income earners took 4.4 per cent of national income, while the highest 20 per cent took
Family Allowances
42.8 per cent of the national income. After the implementation of the various welfare policies for which the minister, and for which the government she is part of is responsible, the 1976 comparable figures show that now 3.9 per cent of the national income goes to the group with the lowest 20 per cent of national income, and for the highest group the figure is 44 per cent.
If we are to believe these figures and I have no reason not to believe them-they are produced by a reputable body known as the National Council of Welfare, I ask the minister whether she can inform the House what she expects the effect of this particular measure to be on this income distribution to which I have made reference? That is what will be the percentage of national income going to the lowest 20 per cent as opposed to what it is now? Can she give us some idea what this figure would be and how she arrived at such a calculation? I will let the minister answer before asking the next question.


Monique Bégin: Mr. Chairman, on the description of poverty given by the hon. member for Athabasca, basically he is right except for one fact when he says, although he be saying it from his heart, that the gap is widening between the poor and the rich. Technically, that is not the description of poverty in Canada. If I take a scientific approach, at a time when some members use their heart, it is because the best way to attack poverty is to talk figures.
The gap is described as this: a constant trend over the last 30 years shows that the 20 per cent at the top of the socioeconomic scale live out of some 40-plus per cent of the revenues, and 20 per cent at the bottom of the scale live out of 4 per cent of the revenues.
As to the need to continue to fight poverty, I hope all hon. members agree in this House that is an urgent matter. However, in the last ten years absolute poverty in Canada, as given by the indicators of Statistics Canada, has been reduced from 20 per cent to 12 per cent. So there has been progress, and that is important to note. However, there is still a lot of work to do. The member refers to it quite properly when he speaks-I think he said it was hidden poverty. It is less flagrant, but it is still alive.
What it does in terms of redistribution is this. It will bring to families with children-and this is something which we have identified as one of the three most vulnerable groups in Canadian society-an additional $300 million, to about 700,000 families who are living below the poverty line. In terms of a particular subgroup of this group, it will give $106 million to single parent families. In other words, 87 per cent of all single parent families will receive some credit benefits, not necessarily the full credit because we have a decreasing scale. It is not a cut-off point at one level of income only. I think that is very important for both the subgroup of the single families and the families with children living below the poverty line in Canada.
As to a point which has nothing to do with the bill but which has to do with the social policy of the country, namely, the need to build in incentives to work in our welfare program, I do not know if the hon. member was referring to the problem

November 7, 1978
Family Allowances
we have in the provinces and under the federal CAP program by which for every dollar earned the person on welfare loses a dollar of welfare. This is a problem I find particularly in urgent need of being tackled. I am very pleased to announce to the House that some of my provincial counterparts are ready now to put that on the agenda for discussion.


Flora Isabel MacDonald: I am glad to hear it.


Paul Yewchuk: 
Paul Yewchuk: Mr. Chairman, the situation that exists today is that while the cost of welfare programs has escalated to a multibillion dollar security program, the gap between the rich and the poor has grown dramatically. Part of the reason, as I already stated, is that the programs have generally been universal. Some 80 per cent of all expenditures are on universal programs. The consequence of this universality has been a substantial dilution of the effectiveness of these programs. Therefore the target population, the poor, receive a substantially lower amount than if this program had been tailored in a specific manner.
To some extent this bill establishes a means test. Is this an indication that all current universal welfare programs will be changed in such a way that a means test will be applied and the target population, the poor, will be given substantially greater assistance in all ways and not just by way of handouts? We know that handouts do not solve anything. In fact people are often trapped in perpetuity by them. Does the minister plan to stick to the past Liberal policy of universality in all these programs, thereby diluting them and making them less useful, or does she feel that if these programs are specifically target-oriented they are perhaps more useful in terms of dealing with the poverty problem?


René Bégin: Mr. Chairman, there is something that surprises me very much. With regard to the hon. member's third question, I think I am justified in reminding him that approximately a year ago he gave me hell, to say the least, and issued a press release because he had interpreted some of my speeches as questioning the universality of social programs. I am not sure where the hon. member stands today. He seems to be no longer in favour of universality.
We said in the House last week that this program gives us what I portray to be the best of selectivity and universality. It is clear to those on this side of the House that the family allowance program, like the old age pension, should be of a universal nature for all Canadians. In one case, we have added the GIS. In the case of children, we are making a correction through the tax system in order to eliminate two tax privileges which do not benefit those it should benefit. We are introducing instead a new child tax credit on a selective basis.
We are not implying any means test. I do not know why the hon. member brought that in. This will be a declaration of
November 7, 1978

income of the two parents in order to provide families below a certain level of income with an additional $200, non-taxable, per child per year. We on this side stand very firmly on relative universality for every child in Canada.
I have difficulty in answering the hon. member more fully until I know where he stands. I do not understand if he is in favour of or against universality in family allowances.


Paul Yewchuk: The minister is obviously confused about the question 1 asked her last spring. I thought at the time she was rather confused because of the answers she gave. I will try to clarify it for her. At that time I took no position whatsoever on universality or anything else.


Mr. Nystrom:: Where do you stand now?


Paul Yewchuk: All I was trying to do was establish her position. At that time she had made some public statements to the effect that she would adjust or juggle some of the existing programs in order to get funds from that juggling to establish a guaranteed annual income.


Monique Bégin: Here it is.


Paul Yewchuk: I asked her to tell us what programs she was going to juggle. I did not tell her not to juggle. I simply wanted to know which ones would be juggled. I took no position on universality.


Lorne Edmund Nystrom: What is your position now?


Paul Yewchuk: I simply wanted to know where she stood, and she refused to tell us. Today she seems to be waffling again.


Lorne Edmund Nystrom: Mr. Chairman, I rise on a point of order. I wonder if the hon. member for Athabasca is willing to answer one quick question before we call it five o'clock?


The Deputy Chairman:: Order, please. It being five o'clock p.m., it is my duty to rise, report progress, and request leave to consider the bill again later this day.
Progress reported.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Turner):: It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Ottawa-Vanier (Mr. Gauthier)-Public Service-Indexing of pensions; the hon. member for Winnipeg South Centre (Mr. McKenzie)-Airports-Winnipeg international-Facilities to assist handicapped persons; the hon.
Child Pornography
member for Ottawa West (Mr. Francis)-Public Service- Relocation and retraining of employees whose jobs declared redundant.
It being five o'clock the House will now proceed to the consideration of private members' business as listed on today's order paper, namely, public bills, private bills, and notices of motions.


Yvon Pinard: Mr. Speaker, there is agreement among all parties to proceed with consideration of Bill C-211 and accordingly to stand all bills that come before it. This has been unanimously agreed to.


Some hon. Members:: Agreed.



PRIVATE MEMBERS' PUBLIC BILLS


Arthur Jacob (Jake) Epp: that Bill C-211, to amend the Criminal Code (pornography), be read the second time and referred to the Standing Committee on Justice and Legal Affairs.
He said: Mr. Speaker, in introducing Bill C-211, to amend the Criminal Code, I seek support from all quarters of the House. A similar bill was studied extensively in the House in the third session of the thirtieth parliament. Its subject matter was studied by the Standing Committee on Justice and Legal Affairs, and a unanimous report of that standing committee was the result. The bill was incorporated in a government bill, Bill C-51, in the third session. That bill died on the order paper at the end of the third session, so I intend today to raise this matter again.
In view of the work which has already been done, I hope there will be unanimous consent to proceed with this subject matter. Hopefully we will receive from the government a commitment that the amendments to the Criminal Code which were incorporated in Bill C-51, specifically the amendments to sections 159 and 166, will be proceeded with and passed in this session.
Those amendments are endorsed by all hon. members on this side of the House, and it is with that in mind that I introduce this bill today.
In the last session hon. members on both sides of the House presented private members' bills on the subject of pornography. As I have already said, this subject matter was referred to the Standing Committee on Justice and Legal Affairs. The bills of the last session, and Bill C-211 which I introduced today, had their geneses among the Canadian people, not in

November 7, 1978
Child Pornography
the House of Commons. There was a ground swell of public opinion against what people saw when they went into corner grocery stores, walked past marquise or wherever they might have been. They were confronted with explicit sexual material, with which they had to be content.
When various members of this House presented their bills, other hon. members were highly skeptical. The ominous threat of censorship was immediately raised. It was suggested that these members were trying to bring back the nineteenth century. While members of parliament might have been slow coming around, the evidence is that the public has been demanding that we take action. The public has been appalled at the sexually explicit material which has become readily available at outlets throughout our country. That material is available not just in our large cities but in almost every community across this land.
Calls for action came from community leaders, church leaders, parents and police departments. The calls were for amendments to the Crimical Code, not to stem the flood of this material, but at least to reduce its impact.
Often in the history of mankind it has taken tragedy to awaken people to what has been happening, and so it was in the last session of parliament. We were not receiving support from a number of members of parliament. We faced innumerable questions about censorship. Then something happened in Toronto which changed everything. It is so difficult for people to learn the lessons of life that it often takes tragedy to force us to face the stark realities of life. The tragedy to which I refer was that an 11-year old boy had to give his life to spark public consciousness about what was happening in our streets. I refer to the death of Emanuel Jaques. That highly publicized event suddenly raised the level of consciousness in the public and in members of parliament. Yes, something had to be done.
I and other hon. members were pleased that the government allowed this subject matter to be referred to a committee. After hearing reports on both sides of the issue, the all-party committee reported that a dramatic increase in the amount of sexually explicit material had become available in Canada. That finding was substantiated. Traditionally this material was in the form of magazines, but it became more sophisticated. In addition to magazines there were home movies, cassettes, and sexual paraphernalia which defied description.
In its findings the committee stated:
A close examination of this development has revealed the emergency of a number of unhealthy social tendencies which are unacceptable to the vast majority of Canadians.
The committee found that too often the material involved was exploitive of women. The result was degradation not just of women but of all humanity.
The committee observed that there was an increasing amount of material vividly depicting the participation of children in sexually explicit acts. This material portrayed children involved in sexual acts individually, with adults, with animals, and with inanimate objects. What I found interesting was that this so-called "kiddie porn" was condemned by all witnesses

who said that adults should have the right to decide what to read or view. When it came to "kiddie porn" all were appalled.
Even pornography peddlers said that this material should not be on the stands. But when pressed further they said they did not peddle it. If they do not peddle it, how can it be on the stands? When pornography peddlers-many of whom are fathers-were confronted with what this material is all about and its ravages on young minds, they were appalled. However,
I assume the dollar speaks louder than their apparent disgust.
Bill C-211 addresses itself specifically to child pornography or "kiddie porn". I am dealing today with the most sordid element of pornography which is now in this country. According to studies, and also evidence before the standing committee, this material is almost totally imported into this country. It is estimated that between 80 per cent and 85 per cent comes from the U.S., and almost the entire remainder comes from Europe. Very little of it is Canadian made.
The customs and excise branch of Revenue Canada is authorized, under the Customs Tariff Act, to prohibit the importation of goods which are described as pornographic. The difficulty with the importation regulations, I suggest, is not a legislative problem but rather one of administration. What is interesting is that ministers of national revenue have been lax before, but the public outcry has suddenly toughened their resolve. Nevertheless, the smut still comes into the country. However, at least there is now a recognition that under the Customs Tariff Act much of this material can be kept out of the country.
The definition under section 159 of the Criminal Code is not totally clear, and so Bill C-211 attempts to define obscenity more precisely, thus giving our customs officers and other officials a clearer understanding of what this House means and how it defines obscenity.
What was pointed out also was that the material of which we are now speaking is produced almost totally by organized criminal networks which, as I said before, have their basic operation in the United States. It is organized crime that is involved in the production, transportation, and distribution of this material.
The Vancouver police department, in co-operation with two other metro police departments, in its presentation to the Standing Committee on Justice and Legal Affairs on February 21, 1978, stated the following:
The Vancouver police department expresses a concern that the pornography industry has a major influence on crime. Pornography cannot be looked at in isolation. The city of Vancouver has a very cosmopolitan population, it is a seaport city with the largest drug addiction problem in Canada. The major prostitution problem involves both males and females and young children who have found the homosexual market to be a means of supporting themselves. It is our contention, that the pornography industry aids and abets the social problem of prostitution.
It is understandable why the purveyors of this filth would oppose any type of restriction on their trade. It is because their trade is highly lucrative. Mark-ups of 500 per cent to 5,000 per cent are common. But is it not an indictment of our society
November 7, 1978

that we can grovel so low that we will even use children, some of them as young as three years of age, to depict sexual activity in order that a profit can be turned? What an indictment of society it is that a profit can be turned because someone is willing to exploit a three-year-old!
Section 166 of the Criminal Code is a section which my bill would amend. At present it pertains to female children only. I suppose that when that section was first drafted and passed in the House it was thought that only female children needed to be protected against rape or sexual exploitation. Well, the world in which you and I live is not the same any longer, and we find now that male children are as much depicted in these magazines as are female children. The exploitation of these magazines by the homosexual market is on the increase, and whether or not we like to raise the topic, it is with us, and it is we who will bear the blame if we allow it to continue. So Bill C-211 amends section 166 of the Criminal Code to include not only female children but also male children.
I was pleased to see that the standing committee in its seventh recommendation supported this bill. This is what the committee stated in its report:
Section 166 of the Criminal Code should be amended to make the procurement of children for the purpose of prostitution or to participate in the production of sexually explicit materials offences punishable by ten years in prison and the following or similar terms-
Those who are opposed to legislation such as I have introduced will argue that obscenity cannot be defined. They will refer, for instance, to the Hicklin test and say that it failed, or they will say that the Hicklin test has been relegated to a secondary position because section 159 of the Criminal Code takes over and there have been judgments where community standards have become the measuring stick. They will say that obviously community standards vary from place to place, from judge to judge, from jury to jury, or from courtroom to courtroom.
I find that in one area, no matter how you want to define obscenity, no matter what measurement you want to use, there is general agreement that there is a common measuring stick, and that is that child pornography is an abhorrence to people in this country. So I hope we will not get hung up again on legal definitions when we refer specifically to section 166 because we are dealing with children. We spend so much time defending the rights of Canadians, and so we should, but is there any greater exploitation than using mechanisms not to come up with a definition or with an amendment, thus preventing these children from having the protection of the law which they so rightly deserve?
I am the first to admit that amendments to the Criminal Code will not end this trafficking and human degradation, but I am convinced that members of the House can show leadership and that changes in the nation can take place and will take place if action such as is proposed today becomes part of our criminal law.
I want to commend the minister of justice who, after the committee reported, came up with the omnibus Bill C-51 in the last session. At page nine of the bill the minister amended
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section 166 along very similar lines to those proposed in Bill C-211. I want to say to the parliamentary secretary to the minister, who will be replying, that that amendment is totally in accordance with my views and is totally acceptable to me.
What I want to do today is to encourage the government to give us a commitment that either the amendments, as I have proposed in Bill C-211, or the minister's amendments in Bill C-51 in the last session, or a refinement of both, or even another one, would be acceptable. I believe it is utterly necessary that we receive a commitment today that this legislation, which has already received first reading in the previous session, will come back to the House and that, before this parliament ends, we will have an amendment to section 166 of the Criminal Code. I hope we receive that commitment from the government today.
I believe the time for action has come. We made progress in the last session, but we cannot allow this amendment to die on the order paper. The good words and good will of the previous session are still awaiting legislative action and passage.
In conclusion, I thank the House for its co-operation on this subject in the past. I hope that co-operation is still forthcoming. If strides cannot be made on the larger question of pornography, I see no reason why we cannot make the strides we want in the area of pornography as it relates to children and the exploitation of our younger citizens.


Some hon. Members:: Hear, hear!


Mr. Stuart Leggatt (New Westminster):: Mr. Speaker, the essence of the bill before us really is in two parts. The all-party committee which reported on this subject accepted in principle the proposed amendment to clause 166.1 of the hon. member's bill, but it rejected the amendment which he proposed to subsection 159(8).
The reason the committee rejected that particular amendment and replaced it with one of its own was to continue to permit this subject to be examined in a subjective way by a jury. The reason the committee in its wisdom felt that is: once one attempts to define specifically what is obscene between two consenting adults, one will define out of our literature a significant number of books which form a very important part of the heritage of western culture, including the Holy Bible, Finnegan's Wake, and a series of literature which was not written for the purpose of pornography. When one moves with this type of shotgun approach to the subject, instead of correcting the abuse in terms of pornography and permitting the free expression of someone with good intentions in the literary field, then the poverty in our literature would be extreme, particularly if this amendment should pass. Hon. members should be cautious when they approach this particular subject.
On the subject of child pornography the committee decided that it was a special area requiring special attention. It decided to provide an objective rather than a subjective test, which is something with which I agree. In fact we have a very special

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problem in terms of protecting those who cannot protect themselves.
Subsection 159(8) of Bill C-211 contains the following definition:
"obscene thing" includes any explicit representation or detailed description of a sexual act-
Then it goes on to define sexual act, and refers to one of those as being vaginal intercourse. There are a number of works of art and literature in our society which suddenly could be removed from the shelves of the libraries of Canada. We do not want to be some kind of cultural backwater in this country. With the best of intentions, the hon. member presented a bill which would be counterproductive if it were passed. If it passed, the objections to this bill would be overwhelming from a vast sector of our country.
In terms of the specificity under clause 166.1, I have no objection to that. We need special protection, but we cannot take away from a jury the question of what is undue exploitation. Lawyers, draftsmen and other people have attempted to define this for the last hundred years, and it just does not work. There has to be some value judgment about what the purpose was.
The hon. member had much to say about the promotion of pornography. The movie entitled "Deep Throat" cost approximately $25,000 to produce, and now it has grossed $50 million. That is the good old free enterprise system. If someone can make $50 million by investing $25,000, of course he will go into the business. There has to be some judgment, which judgment must be exercised by one's peers in a jury democratically. When one attempts to define that out of a jury by saying that a specific act shall be pornographic, with no questions asked or answered, and with no judge or jury looking into it, then one would impoverish the culture of Canada. I cannot agree with that, but I have no problem agreeing with the second part of the bill.


Mr. W. Kenneth Robinson (Parliamentary Secretary to Minister of National Health and Welfare):: Mr. Speaker, I congratulate the hon. member for Provencher (Mr. Epp) for once again coming forward with this bill. Bill C-211 indicates his profound concern about pornography. As he well knows, members of the Standing Committee on Justice and Legal Affairs dealt with this matter and prepared a report. He quoted from the report by referring to recommendation No. 7 which he said in effect referred to his bill.
I was one of those who prepared the draft report, along with the hon. member for New Westminster (Mr. Leggatt), the hon. member for St. John's East (Mr. McGrath), and several others who had bills which were considered at that time. There has been a great deal of input from all parties on both sides of the House regarding the whole question of pornography. It is still of tremendous concern. There is a great deal of difficulty in attempting to resolve this, not only from the point of view of what is or is not pornographic but in defining terms like obscene and others. Apparently that appears to be impossible at this time.
[Mr. Leggatt.)
According to the Oxford dictionary, the word "impossible" merely means that it is difficult; but I must say that it is so difficult that we have not yet been able to come up with a definition. The committee found the same difficulty. It was somewhat rushed in preparing a report before the House adjourned, and it came up with the best report it could under the circumstances. But certainly the report did not contain everything we wanted it to contain. In particular, subsection 159(8) of the Criminal Code probably should have been restated, if possible, so that we would have a much more definitive definition than the one we are still working with today in the Criminal Code.
A difficulty exists regarding the balance between the right to see, use, have, or even read pornographic material. On the other side, there is the whole question of censorship which might be involved, if an attempt is made to take such material away from people who wish to use it.
I should like to refer to an article which appeared in the Sunday Sun of October 22, 1978. It is entitled: "MD: Sex Never Corrupts Anyone", and reads as follows:
Caught junior looking at pornographic pictures or a sexually explicit film?
Don't worry, says leading sexologist Dr. John Money, of Johns Hopkins University in Baltimore.
"If a youngster has been brought up with healthy attitudes he will suffer no harm," says the doctor. "Moreover, sexually explicit material never corrupted anyone."
In the same article they also talk about the question of censorship. So we have this balance that we are trying to adjust to, the question of having pornographic material being made available to those who wish to have it, while at the same time trying to deter others from using pornographic material when it is felt that it is not to their benefit.
I agree with the hon. member for Provencher when he refers to the whole question of kiddie pornography in his bill. It is something which I personally find absolutely reprehensible. It is the worst form of pornography and it is the most extreme form. I agree in part with the hon. member for New Westminster (Mr. Leggatt) when he says that we must take a look at it in depth to determine how far we should go. There could in fact be historical works, works of arts and so on to consider. I have looked at works of art in libraries, and there is no question that according to some standards they would be considered obscene and pornographic. On the other hand, art has been there for years and nobody seems to be too concerned about it, and I suppose this is because it is not on the shelves in the grocery store.
There are some other points I would like to put on the record. As I understand it, the purported aim of this bill is, according to the explanatory notes accompanying the legislation, "to outlaw child pornography and spell out clearly the term "obscene" so that the courts may apply a more objective test than the present one that relates to the "undue exploitation of sex." It attempts to do so by repealing the definition to be found in section 159(8), which reads:
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-a dominant characteristic of which is the undue exploitation of sex, or of sex and any one or more of the following subjects, namely, crime, horror, cruelty and violence-
This bill substitutes in its place a definition of an "obscene thing". As is evident, an obscene thing includes any explicit representation or detailed description of a sexual act and any pictorial representation tending to solicit partners for a sexual act.
The so-called objective basis for assessing whether or not an act is sexual is said to be ascertainable by determining whether or not the act in question involves (a) masturbation, (b) any act of sado-masochism, or (c) any act of anal, oral or vaginal intercourse, whether alone or with or upon another person, animal, dead body or inanimate object, and includes an attempted or simulated sexual act.
Notwithstanding the desires of the author of this bill to limit and define obscenity with reference to objectively demonstrable acts, the descriptions and representations sought to be covered by the legislation are such that they will nevertheless be discoverable only by reference to a multitude of subjective considerations.
It is open to serious doubt that a workable standard of obscenity can in fact be an "objective standard". In an excellent "Study Paper on Obscenity" prepared for the Law Reform Commission of Canada by Professor Richard G. Fox, the following comments appear at page 3:
There is no tangible or verifiable reality corresponding to the label "obscenity". It is an expression of opinion rather than of fact. It is a value judgment based upon the emotive responses of individuals or groups to stimulation by exposure to tabooed materials. The emotions expressed are usually those of disgust, anger and indignation, but the elicitation of these responses is always relative, subjective and variable-
Professor Fox goes on to note that obscenity is an "inescapably subjective phenomenon." He also notes that one of the difficulties with the epithet "obscene" is that for some it "encompasses popular erotica such as the glamour of a pin-up magazine, while for others it is confined to written or photographic portrayals of bizarre sexual or scatological behaviour." Previous attempts which have been made to identify and categorize under the heading "obscenity" vary in approach. Some focus on format while others tend to examine content. Approaches of this nature usually suffer from the deficiency that they do not identify obscene material in a sufficiently distinct form to warrant their use as a basis for differentiating licit from illicit publications. The provisions of Bill C-211 suffer from this shortcoming as well.
It is quite clear that phrases such as "tending to solicit partners for a sexual act" or "detailed description of a sexual act" are vague enough in terms of the phraseology employed to ensure that subjective considerations will enter into the decision making process and thus render the intent of the legislation nugatory.
Before leaving this issue of the subjective nature of determinations of obscenity one should be aware that section 159(3) is untouched by Bill C-211. That subsection provides that no person shall be convicted of an offence under section 159 if he is able to establish that the "public good was served by the acts
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that are alleged to constitute the offence, and that the acts alleged did not extend beyond what served the public good". Therefore, notwithstanding the absence of the term "undue exploitation", there seems little reason to believe that such matters as "literary and artistic merit" and "contemporary community standards" will fall by the wayside in the event that Bill C-211 should become law. The bill impliedly retains and endorses both concepts. In the result it seems quite clear that the provisions of Bill C-211, which seek to replace section 159(8), hold little promise of providing a more manageable, more objective, or more effective basis for guiding judicial determinations on the question of obscenity.
Furthermore, if one contrasts the provisions of the proposed subsection (8) against those in the present section 159(8), it is clear that certain matters presently potentially included within the definition of obscenity will conceivably be excluded by the new proposals. Apart from the reference to "sado-masochism" there is no express concern in Bill C-211 for the undue exploitation of violence, crime or horror.
With respect to the provisions contained in Bill C-211 concerning child pornography, this ministry is in agreement with the intent of the proposals but not with its specifics. Bill C-51 which was tabled in the last session of parliament addresses the issue of child pornography in a somewhat different fashion. As hon. members are aware, the proposals in Bill C-51 were the result of the labours of the Standing Committee on Justice and Legal Affairs and those proposals first appear in the committee's unanimous final report to parliament on this subject. I would point out that the hon. member for Provencher was a member of that committee and had a tremendous input into what the report contained.
While the government expressed the caveat, in tabling the legislation, that the provisions of Bill C-51 were to be subject to possible future change as a result of public discussion and debate, it has nevertheless clearly signalled its intention to move in this area with new, provocative and far-reaching legislation. Certainly constructive suggestions for change, even to the proposed provisions of Bill C-51 dealing with obscenity, are welcomed by the government. Such suggestions for change, if meritorious, can easily be incorporated into the legislation at the committee stage once Bill C-51 is reintroduced during this session of the House.
One may also question the degree of punishment which has been selected for the new offence of child pornography contained in clause 2 of Bill C-211. That section creates a dual offence whereby the prosecutor can either proceed by indictment, which results in liability to imprisonment for two years, or on summary conviction, which carries liability only for a fine in the discretion of the court. The punishments which have been selected are therefore, to a certain extent, lesser punishments than those which are presently available under the general obscenity provisions of the Criminal Code.
The indictable offence punishable under the Code by section 165 possesses liability to imprisonment for two years-the same as Bill C-211-while the summary conviction penalty provided for by the Code results in possible liability to impris-

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onment for six months plus a fine of $500, or simply to a fine in the amount of $500.
If, as this bill presupposes, child pornography is a problem which has reached proportions justifying the creation of separate penalty and offence provisions in the Criminal Code, then one would expect that such an offence would merit greater maximum penalties than more general obscenity convictions would suffer. Instead, under the legislative scheme of Bill C-211 the penalty provisions are roughly comparable. This being the case, one wonders what the basis is for the provision at all inasmuch as the general provisions of the Criminal Code, or even of Bill C-211, dealing with obscenity appear to be equally applicable to obscene things and sexual acts involving the use of children.
To recapitulate, the validity of the premise upon which Bill C-211 is based is certainly open to serious question and substantial doubt. The bill proceeds on the basis that its authors have formulated an objective standard, but close examination reveals that this ideal has not been realized. Once again it is a question of the difficulty of trying to define the terms. I am sure the author of the bill realizes the difficulty still exists. Conceptually, one must acknowledge that there are great difficulties in attempting to formulate any workable objective standard. Finally, it must also be admitted that even a standard which on its surface appears to be objective is nevertheless subject to the subjective interpretations of judicial decision-makers. We all know how the courts can go from one extreme to the other. From court to court there can be a difference in the view that is taken.
With reference to the specifics of Bill C-211, there is serious reason to believe that both the content and the potential effectiveness of the bill are gravely deficient. Alternative schemes for dealing with child pornography have recently been before this House and will shortly be again. The penalty provisions of the bill are somewhat inconsistent with the intention of the legislation and consequently the passage of these measures would be ill-advised. Rather than proceeding further with Bill C-211, it is desirable that we maintain the status quo until clarification and redefinition of the existing law can take place on a better basis.
It should not be forgotten that there are those in the Canadian public who have argued that the existing law is satisfactory both as formulated and in practice. If there are problems, these people contend that they arise from discrepancies in enforcement. Enforcement decisions are discretionary matters for police officers and prosecutors who, as we all know, are individuals who have to act according to the climate of opinion in their local community. I suppose in this context we are taking the local community standard, although as we all know the standard can vary from community to community. Proponents of the status quo further contend that these local discretions provide a useful buffer between legislation which can only by defined in broad principles and which,

because of its very subject matter, cannot provide elaborate, unambiguous guidance in specific cases.
As mentioned, the government has a commitment to the clarification and redefinition of the existing law. This, I understand, is the kind of request the hon. member was making and I am quite sure it is the intention of this government to carry out this kind of commitment. We are concerned with more than a mere "tidying up" of the present Code provisions and are of the view that major policy changes are necessary. We are also mindful of the fact that it would not be useful to permit obscenity laws as presently written to be swept out lock, stock and barrel. The present approach as evidenced in Bill C-51, an approach which, as we have mentioned, is subject to possible change, is to extend and expand the present legislative framework.
Our concern over child pornography is manifest and we recognize particularly that new provisions for dealing with this problem are urgently needed. While saying this, however, we are of the view that the provisions contained in Bill C-211 are not sufficient for this purpose.
To a certain extent, while we are aware that this problem must be tackled, we must also realistically acknowledge that it is unlikely that it will ever be totally solved. The subject matter which constitutes obscenity and the circumstances in which such material is regarded as being justifiably exposed to, changes over time.
While we as a government share the author's views with regard to the bill, we feel that existing law has been unable effectually to moderate the flow of pornography and that Bill C-211 does not change this situation substantially. A great deal more work has to be done with regard to the whole question of pornography.
A further point I should like to mention concerns the report submitted by the Standing Committee on Justice and Legal Affairs on the whole question of expert witnesses. This seems to me to be a real problem. I find it rather difficult to see why there should not be expert witnesses, whether psychologists, psychiatrists, other professionals or lay people with a great deal of experience, or members of the cloth. It seems to me that to deny the right for people to appear as expert witnesses is one shortcoming of the report prepared by that committee.


Mr. Benno Friesen (Surrey-White Rock):: Mr. Speaker, I should like to begin by extending my compliments to the hon. member for Provencher (Mr. Epp) for bringing this legislation forward. I feel it is necessary for this House to consider it and pass it to committee stage so that it may be enacted into law.
Once again we see that some members of the House would rather preserve the sanctity of the purveyors of pornography than the sanctity of children who become victims of it.


Some hon. Members:: Oh, oh!


Benno Friesen: Is it not so? Listen to them. I hear the hon. member for New Westminster (Mr. Leggatt) say "oh". He now becomes the authority on art and wants to preserve the Bible. He contends that the Bible could not be read if this bill
November 7, 1978

were passed. I have read the Bible most of my life and have studied it extensively. The hon. member argues that if the proposed changes in clause 1 of the bill were passed it would mean that subsection 159(8) of the Criminal Code would prevent him from reading the Bible. If this bill fails-and I hope it does not-and if the hon. member's view prevails, I hope it will give him reason to keep on reading the Bible. I hope he will read it from cover to cover and not just those explicit sections to which he referred.
The issue of censorship is brought up every time we discuss this bill. I am sure there is not a member in this House who does not believe in censorship. Everyone here, including you, Mr. Speaker, believes in censorship. The only thing we differ about is what is going to be censored. If someone proposed that we legalize anti-Semitic literature, I think all of us would be horrified that we should go through that holocaust again. Every one of us would decry that type of publication and want it stopped.
We all agree there are some things that ought not to be published and which some people should not benefit from. What we disagree on is what is destructive. I maintain that the publication of anti-Semitic literature is destructive. I maintain also that the kind of literature referred to in this bill is destructive and that those who profit by it are even more destructive. So, Mr. Speaker, I ask hon. members whether they believe in censorship and whether they should not include in their definition of what is destructive some other elements in society which try to destroy us.
We want freedom of choice in this country and I want to see that preserved. But how are we going to preserve freedom of choice for the next generation if we allow these sordid people to influence the future thinking of today's children, to program them in such a way that in future they will not have freedom of choice?
The purveyors of this filth load it on to the newsstands. Ironically the drugstore newsstands, those areas that are supposed to be preserving the health of our country, are loaded with the kind of so-called literature that is destructive and is now programming the thinking of children who, when they become adults, will not be able to make rational and informed decisions. Children of an impressionable age have a high curiosity level, but they have a low level of information on the consequences of their decisions and a low level of experience upon which to draw. Now we have them being bombarded with this kind of material and they are programmed in such a way that they can no longer make a firm, rational decision later on in life.
What we are looking for is a freedom of decision making process in our society. What people who want to make money from the exploitation of these children want is to program them so that in years to come they have a ready market. It is ironic that this House several years ago passed Bill C-58 which was designed to close the borders to television from the United States. Whether or not we are for that bill is either one thing
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or the other. It is ironic that we should close off television from the United States but keep it relatively open for this kind of material. We cannot have it both ways forever.
One of the popular terms today is "sexual orientation". It is said that this should be a matter of individual choice. Individual choice has become such a buzz word, such a matter of sanctimonious discussion, that we really do not adopt a consistent attitude toward it. We do not allow individuals to express their individual choice when it comes to the handling of firearms, as the hon. member for New Westminster well knows because he supported the gun legislation. In that case we do not want to have individual choice because that would become destructive. A guy could take a "Saturday night special" and go to a store or bank and shoot somebody. We do not want individual choice in that area. Why is it, then, when it comes to sexual orientation, when it comes to sexploitation, when it comes to "child porn," that we all of a sudden become sanctimonious about the matter of individual choice?
I come back to my original statement, sir, that we are not in disagreement on freedom of information or freedom of publication; what we are agreed on is that we want to preserve choice, but we cannot preserve choice in our society if children are already programmed to think in a certain way before they are ready to make an informed decision.
I compliment the hon. member for Provencher for bringing this matter forward and allowing us to speak and make a decision on it. I ask hon. members to give passage to this bill so that it can go forward to the committee stage. If hon. members wish to make some changes to it, if they think there is merit to it, as the hon. member for Toronto-Lakeshore (Mr. Robinson) says there is and as the hon. member for New Westminster agreed, let them make amendments to the bill there. But let the bill go to committee so that we can discuss it further.


Mr. Raynald Guay (L6vis):: Mr. Speaker, I want to congratulate the hon. member for Provencher (Mr. Epp) for introducing this bill, and I want to give the House my first reflections after reading it. First of all, I find it does not go far enough in its definitions. The definition it gives of an obscene thing does not seem complete or large enough to me, as several members who took part in this debate pointed out. I see the definition of an obscene thing not only in the area of sex but also in the exploitation of hatred, anger, false heroes in movies that lead young people to imagine a false society of false heroes.
A big thing has been made out of sex but when talking about sex I think we have to go further and after reading this bill and listening to the debate in the House this afternoon 1 wonder what kind of society we want to build for our young people if they are exploited even before they are part and parcel of society, even before they are of age and responsible within society, even before they have the right to vote, because the bill defines a child as being under 16. Those young people are being exploited not only in the area of sex but also by

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giving them false heroes, but showing them a future altogether different from reality. We do not show young people how to live. We do not take them through the normal steps of youth so they can become mature. They have been taught an idealized notion of love which has quite simply been reduced to sexual acts when love, Mr. Speaker, is quite simply the respect of the other person. They have shown obscene movies and literature-and I do say "obscene" and not only "sexual". They are not being respected. So it is up to us the responsible people in society who have to pass legislation, build that society for the people of tomorrow, to orient them. I was asked earlier if I was in favour of censorship. Well, yes, I am for censorship because there must be limits in our society, because, as we can see, some want to copy a type of society. The hon. member for New Westminster (Mr. Leggatt) or the hon. member for Provencher said earlier that 85 per cent of hate or obscene literature comes from other countries. Do we want to build a country like France, Sweden or Norway or do we want to build our own country with our own young people? If we politicians do not respect them in the legislation we pass, I think we will have missed the boat. The only people responsible are not the young but we, politicians, who must asked themselves the following question: Have we built for young people who still have as I say, a lot of ambition in life, we are still at the age when they are shown a bit of joy and hope in the future but what are we through our legislation or too much freedom going to do? I will now refer to Gustave Thibon who while taking a walk in Paris saw in the window of a bookstore the works of leftists among which one was entitled Comment batir I'avenir by the socialist party while another advocated freedom for women to dispose of her body and abortion on demand. And this is the inconsistency: on one hand they stated that we must build the future, on the other hand they maintained that a child must be killed before birth. Such is the policy of the party, I will not say of the NDP but of the socialist party or socialistic countries, that is to grant every freedom to the young people, to give much-


The Acting Speaker (Mr. Turner):: Order, please. The hour provided for consideration of private members' bills has now expired. Perhaps the House will permit our going back to the committee of the whole before the Chair calls it six o'clock. Is that agreed?


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration in committee of the whole of Bill C-10, to amend the Income Tax Act to provide for a child tax credit and to amend the Family Allowances Act- Mr. Chretien-Mr. Turner in the chair.
Charles Robert Turner: Order, please. It being six o'clock I do now leave the chair until 8 p.m.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 8 p.m.
On clause 1-
Mr. Smith (Churchill):: Mr. Chairman, 1 represent a constituency which is two-thirds the size of the province of Manitoba. Within that constituency are some 25,000 status Indians. A large majority of them, through no fault of their own and not by choice, are recipients of welfare on an annual basis. I have a number of questions. First, who is responsible for the payment of welfare to status Indians in Canada? I would like to establish that, please.


Alan Gray Martin: Mr. Chairman, I would like to consider that question a little more and get back to the hon. member later in the debate.


Cecil Morris Smith: Mr. Chairman, I find it rather odd that a simple question like that cannot be answered when we are debating a bill that will involve the status Indians of Canada probably more than anyone else.


Alan Gray Martin: Mr. Chairman, I do not particularly have any apology to make for not having an answer at this point as to who makes payments to status Indians, when we are dealing with a bill to amend the Income Tax Act. However, I am prepared to determine that information for the hon. member and get back to him in due course.


Cecil Morris Smith: Mr. Chairman, this answer has a direct bearing on my questioning. I would like an answer to this very simple question. Either the parliamentary secretary or the officials who are here should be able to give me that information. It is relevant to the information I need for the balance of my questioning. If he cannot answer it, I will attempt to go on. However, with his officials sitting there, I find it odd that he cannot answer a simple question like that.
I will ask another question to see if I can get an answer to it. In determining welfare payments to status Indians, is the
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family allowance income figured in the amount of welfare that would be paid to a status treaty Indian or an Inuit?


Alan Gray Martin: Mr. Chairman, the first point I would make perhaps relates more to the first matter raised by the hon. member. It deals with a matter directly before the committee at this time, namely the income tax provision of the $200 credit. The credit will indeed be payable to status Indians.
I will have to take the second question in reserve. The Minister of National Health and Welfare will be in the chamber shortly. As well, the officials are looking into this. I will get back to the hon. member. However, I want to make it clear that the $200 credit, which is part of the bill in front of the House at the present time, will be payable to status Indians.


Cecil Morris Smith: Possibly I should turn the questioning over to someone else. There is no point in my continuing my line of questioning when I cannot get an answer to a simple question. I will take my place until someone is here who is qualified to answer my questions.


Alan Gray Martin: Mr. Chairman, I would like to make a point in connection with the matter raised by the hon. member for Churchill. I know his questions are well put. On the other hand, I do not think when we are dealing with an income tax amendment-


Cecil Morris Smith: On a point of order, Mr. Chairman, we certainly are.


Charles Robert Turner: Order, please. The parliamentary secretary has the floor.


Alan Gray Martin: I do not believe any question related to any matter that might come before the House of Commons can be considered to be necessarily relevant. However, I have indicated that an answer will be obtained. This has been done on two or three occasions when questions have been raised in the committee and we did not have immediate answers. I assure the hon. member that we will indeed have an answer for him.


James Aloysius McGrath: Mr. Chairman, I rise on a point of order. The hon. member's question was really very relevant and very much connected with the bill before the House. It raises the question, where is the Minister of National Health and Welfare who has a responsibility for piloting this bill, and where is the Minister of Finance? Because this is a finance bill, an act to amend the Income Tax Act. We were told there was a possibility that the Minister of Finance might just favour the committee with his presence tonight. Is he going to be here?


Alan Gray Martin: Mr. Chairman, I would like the hon. member for St. John s East, who has been up on three or four points of order, to relax a little. Just relax. First, the question that was asked should more properly be put to the Minister of Indian Affairs and Northern Development during question period.


Some hon. Members:: No, no.
Family Allowances


Alan Gray Martin: I now have an answer, if hon. members are interested in hearing it. Is the hon. member for Churchill interested in hearing the answer?


Cecil Morris Smith: Mr. Chairman, if the parliamentary secretary can give me an answer, I will be very much interested in it. However, it seems he cannot give even a simple answer. The answer I am looking for pertains to this particular bill.


Alan Gray Martin: Mr. Chairman, I was trying to indicate that I had an answer. I was wondering whether members opposite were prepared to listen.


Cecil Morris Smith: It's a good thing the minister has just arrived.


Alan Gray Martin: I have not had an opportunity to say a word to the minister yet. The answer to the question put to me a little earlier as to who is responsible for welfare payments to status Indians is this. The Department of Indian Affairs and Northern Development is responsible for Indians on reserves. The responsibility for Indians off reserves rests with the provinces.


Cecil Morris Smith: Mr. Chairman, I would now like an answer to the second question I asked. Are family allowance payments to status Indians on reserves taken into consideration when welfare payments are made?


Alan Gray Martin: Mr. Chairman, I understand that in this particular case it is up to local band councils as to how that matter is handled.


Cecil Morris Smith: That is an easy cop-out, but it is not that simple because many bands are under joint administration. Many bands to not look after their own welfare administration. In many cases this is handled by the federal government. Goodness knows, most Indians on reserves are living on welfare, and I want to know whether family allowance payments are taken into consideration in determining the amount of welfare. This relates to this bill because it involves family allowances.


Alan Gray Martin: Mr. Chairman, the answer is yes.


Cecil Morris Smith: Mr. Chairman, that sets the tone for the remainder of my questions. I will tell the committee exactly what will happen. Most of the Indian people in my constituency who are on welfare are on welfare because they have no choice. The parliamentary secretary says that the family allowance an individual receives helps determine how much welfare that individual receives. As of January 1, 1979 there will be a reduction in the monthly family allowance payment going to an individual on a reserve in receipt of welfare of at least $8. In order to retain the same level of income this individual has been accustomed to, there should be a welfare payment increase of $40 per month. This calculation applies to a family with five children.
894

November 7, 1978
Family Allowances
Will welfare payments be increased by $40 per month to make up for this reduction of $8 per child per month? What will be done at the end of the year regarding the $200 payment for each child? That amounts to $1,000 for a family with five children. Such a family will receive $1,000 at the end of this year. Will $480 be deducted from that in order to recoup the $8 per month per child welfare payment increase? I would like to know whether the family in this calculation will receive a cheque for only $520. The people in some of the communities in my constituency do not understand what this government is trying to do. There must be an answer to such a simple question, and I hope I can receive that answer right now.


Alan Gray Martin: Mr. Chairman, I think we are wandering a long way from the bill we have before us.


An hon. Member:: No.


Cecil Morris Smith: Mr. Chairman, we are not straying from the bill at all. My question relates to family allowances, and that is what we are discussing here.


Charles Robert Turner: Order, please. The parliamentary secretary has the floor.


Alan Gray Martin: I repeat that I think we are wandering quite a long way from the bill. However, my understanding is that the mix of payments received by status Indians will perhaps undergo some change, certainly in the early months of the new year before the credit becomes due, as a result of the reduction in family allowance payments.


Cecil Morris Smith: Mr. Chairman, that is no answer at all. The parliamentary secretary says this has nothing to do with this bill. That might wash with some people, but it certainly does not wash with me or anybody else on this side of the House. The government is asking for passage of this bill. Today the minister said we are filibustering, but the government cannot supply a simple answer to a simple question. I think my question is very relevant.


René Bégin: Mr. Chairman, I would like the hon. member to clarify whether his question deals with the source of welfare payments to Indian mothers because of deductions which will reflect on the family budget, or whether he opposes the child tax credit being granted to Indian children.


Cecil Morris Smith: I will go through it again.


René Bégin: That is very easy to answer.


Cecil Morris Smith: As hon. members know, most Indian people on reserves are living on welfare because they have no choice. I estimate that on the reserves in northern Manitoba 75 per cent of the people live on welfare. They have no hope whatsoever of getting jobs in the communities in which they live, so they will never earn more than $18,000 per year. Indians on reserves do not pay income tax on incomes earned on reserves.

I will try to explain my question carefully again. After indexation Indian families on reserves should receive $28 per child per month, but if this bill passes they will receive only $20 per month per child. Family allowances received are included as part of the unearned income of families living on welfare. For an Indian family living on a reserve to receive the same amount it received prior to this bill, its welfare payment will have to increase by $8 per month per child. What I am asking is whether families with five children will have to pay back $480 at the end of the year in which it gets a $200 per child tax credit, or will the government deduct that from the tax credit before the cheque goes out? That is my concern. I hope I have explained it clearly, and I hope I get a clear answer.


Alan Gray Martin: Mr. Chairman, 1 think I understand the problem which is being raised by the hon. member for Churchill. Basically the aim is to see that no one receives less as a result of this bill. I think no one will. How the mix will be made up and how this will actually be done is still under consideration, but certainly the idea will be that people will not suffer in terms of the net amount they receive.


Cecil Morris Smith: Outside the reserves they are treated similar to other people who receive welfare payments from the provinces. I took the same position with the Minister of Indian Affairs and Northern Development as I took with the provincial ministers. I want to make sure that the tax credit is passed on to these families. As yet I have not received a reply, but I will continue to press for one.
The hon. member is correct when he indicated that Indians are the most vulnerable group because they do not pay taxes and they are not connected to the tax system. I will be meeting with the National Indian Brotherhood in approximately one or two weeks and this point is on the agenda of that meeting. Of course, I would like to have the co-operation of the National Indian Brotherhood. I will discuss with them a mechanism to reach the people in those communities.


Cecil Morris Smith: 
Charles Robert Turner: Order, please. I regret to interrupt the hon. member but his allotted time has expired.


Andrew Hogan: Mr. Chairman, I should like to make a few comments before I ask any questions. Deliberately I refrained from taking part in the debate on second reading, but I want to assure the minister that I am well aware of what is going on here. I do not like clause 10 at all because of the reduction in baby bonus or child allowance from $25.65 to $20. This was not necessary in order to accomplish the tax credit for children, which the minister was successful in getting through cabinet. Over the last three or four years, since most cabinet ministers apparently have become strongly right-winged and conservative, she must consider this a victory. Nevertheless, I join with my Conservative colleagues in making that suggestion to the minister.
It is not my intention to filibuster this piece of legislation. I realize this is a federal bill. I have no ulterior motives. I know the Minister of National Health and Welfare cannot receive an ironclad guarantee from the provinces.
A considerable number of her constituents are below the poverty line. Having worked in a poor district in Montreal and as a member of the House of Commons, I am sure she realizes the provinces can play tricks with federal legislation and money, directly and indirectly. I accept the minister's challenge as a member of the House. I will do my part to make sure that volunteer agencies, social workers and the provincial government in my area will not use this legislation in order to prevent a real distribution of income to those families below the poverty line.
Having said that, let me point out that we should not exaggerate what has been done here. From a philosophical point of view, this is a small but important step toward the adoption of a negative income tax. But I, too, am concerned- and here I am repeating myself-because from my practical experience as a member of parliament in the last four years I know that unless great pressure by the federal government is
80065-57)4


Andrew Hogan: Mr. Chairman, maybe I just do not understand the minister. In order that the financial people around her can confirm this, let me put the question in this way. We have a bill now before us which provides a reduction in the amount of credit for some families with an income of over $18,000, while allowing the full credit to other families with incomes approaching $30,000 because of the effect of the deductible provision in our income tax system. Is that right or wrong? This deductibility provision allows people who are in the higher income brackets to take advantage of such things as the registered retirement savings plan and so on.
November 7, 1978


Andrew Hogan: Mr. Chairman, I thank the minister for that answer; I think I understand a little better now. I hope she is right in what she says because her last explanation made it a little more clear to me, and made a little more clear her intentions in this regard. I hope this turns out to be the case with members of the Department of Finance.
The only other observation I want to make, to be followed by a final question, has to do with the total social budget of the minister. I know that one minister in government can have no control over this type of thing because of cabinet pressures, particularly in a time of restraint. I am sure that the provinces will try to get around this. The minister has indicated that she
Family Allowances
intends to carry out an educational program, and I am sure that those of us who believe in that tax credit system will do what we can to help out, mainly because we think this system is somewhat better than the situation we now have, and perhaps a step toward a guaranteed annual income when the economy picks up.
At this time our biggest problem results from slow growth or what the AIB has called a sluggish economy. It is comical to hear that body refer to the fact that an increase in interest rates such as the one just made will help inflation while at the same time it talks about restraints and a sluggish economy. If you substitute slow growth plus higher unemployment for the phrase "sluggish economy", then the board is praising the fact that the government is allowing this increase in already high interest rates along with increased restraint in order that we can have higher unemployment and slower growth. That is just an aside, but that is convoluted economy if I have ever heard it, and certainly poor social philosophy.
One of the things I am concerned about is the fact that at a time of government restraint CMHC is cutting back on such programs for the poor as the residential rehabilitation assistance program to the tune of $29 million, and now the minister has indicated cuts in respect of co-op housing, all of which will hurt the poor and those on low income. What I am afraid of is that the totality of these things, in addition to changes in unemployment insurance which will make it tougher for young adults to enter the labour force, will have a negative effect on what the minister is trying to do.
As my final question I would ask what percentage of the total social sectoral budget, if I can put it that way, which is under the minister's care-and she mentioned something like $300 million-is represented by this type of expenditure, what percentage does the total sectoral budget represent of the GNP, and what percentage is involved in this tax credit scheme?


Monique Bégin: I am not sure I have understood the question fully, but in the totality of the decisions made in August regarding the government budget, the result in respect of programs under national health and welfare, in what one could call the social sector under my responsibility, will be an increase in expenditure, but not an increase in taxes, of about $290 million or $300 million. That is the cost of the GIS increase. The child tax credit will finance itself within the system in the sense that it uses the savings through the cancellation of the $50 child tax exemption, and the savings from the cancellation of the special privileges for the 16 and 17 year olds and from the reduction in basic family allowance. In this way it is self-financing within the system.


An hon. Member:: What about the budget for social expenditures?


Monique Bégin: I think the important question is, does it reduce the percentage of social commitment or social expenditures in the total budget of the government, and it does not. The distribution is changed slightly in that we have changed the

November 7, 1978
Family Allowances
tax privileges. I suspect it will slightly increase the budget for social expenditures within Canada within the total budget, but I do not have the exact figures.


Mr. Lambert (Edmonton West):: Mr. Chairman, I would like to intervene to refer back to the debate we had the other day on my private bill, Bill C-203, which was aimed at curbing the expansion of the illicit use of the social security number concept. I can recall when social security cards were introduced on a voluntary basis in 1964. The Minister of National Health and Welfare, for whom I have a great deal of personal respect, has become an innocent victim-

-of the civil service.


René Bégin: Do I look innocent?


Marcel Joseph Aimé Lambert: Listen, you could be told something else, at another time and place, in other circumstances, but-

The President of Privy Council said in March, 1964 that the social security number would not be used for income tax purposes. The Prime Minister in April, 1964, in the same debate, said that it would not be used for purposes of income tax. In 1966, however, there was a very subtle introduction of the social security number for identification purposes on the income tax return as established under section 237 of the Income Tax Act.
I am concerned about the "Catch 22" situation I described the other day, that under the guillotine in 1976 there was passed a requirement under section 234 whereby a declaration of ownership should include the social security number of owner. I do not know what good it does because there is no way of checking on the number. There are people in this country who hold at the present time 30 to 40 numbers, albeit illegally. There is nothing to say when a person goes to a bank, trust company or any other institution that cashes Canada Savings Bond coupons issued prior to 1977 that the number on the ownership certificate is the right one. The ownership certificate, for example, could be that of my wife, and I may have filed it for her as her agent. It is not necessary for her to have a card.
There are many people in this country who refuse to have a social insurance card. If it is the government's intention that everybody shall have a national identification number in the concept described in George Orwell novel "1984", then let the government come forward and say so. It does not have to do it under the guise of the Income Tax Act.
I have in my possession letters from the Acting Minister of National Revenue written for her by her officials, and they are complete nonsense. There is a woman in this city who owns some Canada Savings Bonds, a gift to her from her husband. Under the requirement of attribution of income, the coupons were being credited to her husband's income, but ownership of

the bonds is in her name. When she went to cash some coupons the bank insisted on her providing a social security number, and she refused to do so because she does not have one and does not need one. She felt that it was not necessary since she was not qualifying for the Canada Pension Plan and she was not employed. For not complying with the regulation there was a 25 per cent penalty imposed on the coupons of the bonds. The bonds were given to her at a time when these conditions did not apply.
The government through the Department of National Revenue, for which the Minister of National Health and Welfare is acting minister, has imposed a new rule on the game, and it is a breach of agreement with the purchasers and holders of Canada Savings Bonds prior to 1977, because bonds purchased prior to 1977 were never part of the game.
The Parliamentary Secretary to the Minister of Finance and others on the government side said in the debate on my bill, that it was an easy matter to pay the 25 per cent penalty and then claim a refund on the income tax return the following year. There is a "Catch 22" situation here, however, because under sections 150 and 237(2) of the Income Tax Act the form requires a social insurance number. When the lady in question went to claim her money, she was told she would have to file an income tax return and that they required a social security number. She has no need for a social security number, but the income tax department through the bank was insisting, improperly and immorally, on a 25 per cent penalty on coupons prior to the 1976 bond issue. After receiving her money they turned around and said that she could not have the 25 per cent refund because she was not able to file a proper return. She complained that she had no need to file a return because this was her sole outside income and, it was being declared every year on her husband's return, according to the guidelines of the Income Tax Act.
This lady was not required to file a return because the income was being declared under her husband's name. The bank for this reason would not refund the 25 per cent penalty.
Finally, there was a weasel. The Department of National Revenue replied in a letter dated September 13, 1978:
The social insurance number is required as an identifier of contributions and benefits of Canada Pension Plan and unemployment insurance.
Neither category is applicable to her.
It is required to be reported on information slips and on individual income tax returns.
Once again, it does not apply to her, with the exception of ownership.
It has become an integral part of my department's linkage in the processing of assessments and reassessments of individual income tax returns.
This is totally contrary to the undertakings of the minister of labour and the prime minister of the day in 1964.
My department's computer system has been designed to automatically request a social insurance number where one does not appear on the return.
In other words, it is the computer that determines whether you need a social insurance number.
November 7, 1978

This policy has been the subject of an in-depth review by my senior officials. Although several arguments can be made for not requesting a social insurance number, the use of social insurance numbers is a great benefit in properly identifying the taxpayer.
It is merely bureaucratic convenience and expedience.
For this reason, the decision was made to continue requesting social insurance numbers where one has not been provided. If a social insurance number is not provided upon request, under certain conditions, the return may be processed; however, in all cases, a further request for a social insurance number will be issued.
In your case, my officials at the Ottawa district taxation office will be processing your 1977 return without your social insurance number but a further request for a social insurance number will be issued. I might mention that if your circumstances in respect of future taxation years are similar to those for the 1977 taxation year, your returns may be considered incomplete-
That is, under section 237(2). The letter continues:
-and not suitable for final processing until such time as a social insurance number is provided.
This is bureaucratic nonsense of the worst kind. This is what I want to bring into perspective with the requirements of this bill, particularly clause 7 which reads as follows:
(2) Every person who, knowingly, or under circumstances amounting to gross negligence in the carrying out of any duty or obligation imposed by or under this act,-
This refers to the Income Tax Act:
-has made or has participated in, assented to or acquiesced in the making of, a false statement or omission in a return,-
The omission referred to is the social insurance number from the form that has to be signed by the two spouses, because there are joint statements of income. There are hundreds and thousands of married women and mothers in this country who do not have a social security number and who do not need it, yet a 25 per cent penalty is imposed on a family unit where one spouse does not have a social insurance number. That is a big club, Mr. Chairman. Children who may have received a Canada Savings Bond from a grandparent for a birthday or for Christmas cannot get full value for it, because a child cannot get a social security number and would have to pay the 25 per cent penalty. But they are not taxpayers and therefore cannot file a return. It is a "Catch 22" situation all over again.
I am told on the quiet that this provision is included on the insistence of officials at the Department of National Revenue, so I am addressing the minister in her capacity as Acting Minister of National Revenue.
This provision is immoral. It is a breach of an undertaking of this House to the people of Canada that this would never happen. I see some hon. members laughing at this use of the word "immoral" in regard to the social security number. They should see some of the letters that have been written to me about their performance on television during debate on my private member's bill, Bill C-203.
I make this final plea to the minister, that this insistence on and extension of the use of the social security number is dishonest. If it is a question of ultimately getting total identifi-
Family Allowances
cation of all individuals, step by step and surreptitiously, then we must protest.
The other day the minister said quite candidly that she was responsible for the administration of $14 billion of social security legislation. I fully agree that was the purpose-and unemployment insurance-but nothing else.


Monique Bégin: But this is social policy.


Marcel Joseph Aimé Lambert: It is within taxation. These are amendments to the Income Tax Act and there will be no bootlegging through the back door. Perhaps I can emphasize this by taking my argument to absurd limits. I can see that the Department of National Health and Welfare will soon try to obtain sufficient information to put in their computers so that the minister will be able to engage in the mating game. She will have information on all males and females in this country and through her computers she will be able to match them up and perhaps send out little suggestions. So through the Department of National Health and Welfare the ultimate use of this information that is slowly being compiled will be for what I call the national mating game. I will not say this particular minister will do it because I do not see her future in this ministry for very long.


René Bégin: Where am I going?


Marcel Joseph Aimé Lambert: I do not know but not over on that side of the ministerial benches. For the life of me, Mr. Chairman, I cannot see why we must have this extension, under penalty, of the use of social security numbers.


Alan Gray Martin: Mr. Chairman, I know the hon. member for Edmonton West has some slight concern in the area of social insurance numbers. This was the subject of his recent private member's bill on which a number of members on this side participated, as well as in a question of privilege raised by the right hon. member for Prince Albert. The hon. member for Saskatoon-Biggar also brought the matter up on one or two occasions.
I know from discussions publicly in this House and privately with the hon. member for Edmonton West recently that he is exercised about the relatively few Canadians who are themselves concerned about the law this parliament passed a year or so ago. It had nothing to do with bureaucratic nonsense; it was a law of this parliament. I am sure the hon. member for Edmonton West is as anxious as anyone that the laws passed in this House be obeyed throughout the country.
We are moving around in a wide circle in the course of discussions tonight, and I suppose we might as well continue that way. We are now talking about the use of social insurance numbers as a requirement for cashing bearer bond coupons.
In order to insist on proper compliance with our income tax laws, this parliament considered it appropriate to pass a law, which was enshrined in subsection (5) of section 234 in January, 1977, which said in effect that when you cash bearer bond coupons in the future, in order that the income tax department may have some hope of tracing unreported

November 7, 1978

Family Allowances
income, you must produce a social insurance number. I believe I am correct in saying that figures recently published show that about 80 per cent of Canadians now have these numbers. In any case, a large proportion of Canadians have social insurance numbers and it does not seem to be a matter that is creating a great deal of concern.
Nevertheless, if, as the right hon. member for Prince Albert indicated, you do not have a SIN number and simply cannot stand to have a number for that purpose, even though you will have numbers if you have any kind of a charge account card, a department store card, a bank account, a licence or a telephone, a mailing address etc., if you insist that you will not, under any condition, have a social insurance number, then fine, you are not obligated to get one. The Department of National Revenue says "All right, we will not be able to trace in your case, under normal circumstances, whether you declare that income or not; what we will do is withhold 25 per cent of the interest that is otherwise payable to you. You can then have that interest back at the time you file your income tax return."
I know the hon. member for Edmonton West is concerned that some people may have recieved bonds from their husbands, or husbands from their wives, and under certain provisions in the Income Tax Act which have been there for a long time, the income is deemed to fall in the hands of the donor, but they may not be subject to income tax and never ordinarily have to file an income tax return.
The point is that this 25 per cent deduction is not a penalty, it is a withholding tax. The hon. member for Edmonton West knows there is quite a significant difference under the Income Tax Act between penalties and withholding tax. They are entirely different things. A penalty is something that you have to pay because you have done something wrong in accordance with the requirements of the Income Tax Act. A withholding tax is something that is deducted and later returned to you if you are eligible, either in the form of a reimbursement or as a deduction from your tax otherwise payable.
In raising this issue here, I suggest the hon. member for Edmonton West is confusing two entirely separate issues. I have been speaking of the requirements under the Income Tax Act for a withholding tax under section 234(5) for bond coupons that are cashed. There is also, as he mentioned, a requirement in the Income Tax Act under subsection (2) of section 237 that requires you to use your social insurance number when you file an income tax return. That provision has been in the act for ten or 12 years, passed by an earlier parliament and enshrined in the laws of our country. He is confusing these two things with two other requirements under the Income Tax Act which have nothing whatever to do with social insurance numbers. He is relating the problem to clause 7 of the present bill.
I would be delighted to get to clause 7, but we are talking about it on clause 1. Be that as it may, the requirement under
this particular bill has nothing to do with social insurance numbers. Indeed, it does speak to a penalty, not a withholding tax, and it provides a penalty if you make false statements.


Marcel Joseph Aimé Lambert: Or omit to fill in a form.


Alan Gray Martin: That is already covered in the Income Tax Act under section 162, subsection (3)-failure to provide complete information. Also, I believe section 163, subsection (2), which is statements or omissions in filing returns applies. It is clearly indicated in the literature that accompanies clause 7 that all we are attempting to do in this particular clause is to extend the penalty provisions under section 163, subsection (2). In other words, if you make false statements under the Income Tax Act you have a problem and you are subject to a penalty of 25 per cent; not a withholding tax-a penalty, a fee, a fine. All that is being said in clause 7 of this bill is that that kind of a fine will also be applicable if you make false statements when applying for this new child tax credit.


Marcel Joseph Aimé Lambert: Or omit to fill in a form.


Alan Gray Martin: It is as simple as that and nothing more. It has nothing whatsoever to do with the issue of the social insurance numbers, which I know still concerns the hon. member for Edmonton West. His concern may or may not be appropriate; I do not think it is. I do not think the argument has any place in this bill, particularly clause 7 which, as I say, has nothing to do with the particular problem relating to social insurance numbers.
[ Translation]


Gérald Laniel: Order. I must point out to the hon. member that the time allotted to him has now expired.


Arthur Jacob (Jake) Epp: Mr. Chairman, I would like to place some questions before the minister and the parliamentary secretary and follow up questions put by the hon. member for Churchill. I do not think we have yet had the answers we need. First, respecting status Indians living on reservations, are they liable to the payment of income tax?


René Bégin: No.


Arthur Jacob (Jake) Epp: In view of that fact, will status Indian mothers living on reservations have to file income tax returns to collect the child tax credit?


Monique Bégin: The child tax credit to be received will involve one form or more in connection with the income tax system. That is one of the points I intend to take up with the National Indian Brotherhood.


Arthur Jacob (Jake) Epp: The Minister said this afternoon that we have spent too much time on this bill. I think we pointed out quite conclusively that this was not the case and in fact that two days had gone by without debate on Bill C-10 other than for some 40 minutes on the one day and 35 minutes on the other. Now the minister says she wants to meet with the National

November 7, 1978


Arthur Jacob (Jake) Epp: The point I want to make to the minister-and I am not excited-is that the minister has come in with a half-baked proposal that she herself has no answers to. That is the point. It has been a long-standing agreement between the status Indians and Governments of Canada that there would not be changes in the payment of income tax without full agreement between the two parties concerned. The minister does not have that agreement. She has not even sought the agreement. In fact, she has not even met with the National Indian Brotherhood. Now, suddenly the problem has developed and she says yes, I must meet with the National Indian Brotherhood.
She has no answer; she has evaded the question totally. I ask again; Will status Indian mothers living on reserves have to file income tax in order to get the tax credit?


Monique Bégin: Mr. Chairman, I am, rightly or wrongly, suspicious of people who start taking as their victims the Indian mothers. I do not know why they speak only of them.


Some hon. Members:: Oh, oh!


René Bégin: Where is it hurting? I would like to know if they are in favour of or against the child tax credit for Indian and Inuit children. They have never answered me. I wonder why that sort of question always comes from the same party, suggesting there will be misuse. I have heard it said more than once.
Family Allowances
This bill will provide mothers with a child tax credit. In order to do that, it will connect them to the tax machinery. It has nothing to do with making them pay tax, and I hope the hon. member understands that.


Arthur Jacob (Jake) Epp: What about filing?


René Bégin: If they do not pay tax, they will not file. That is pretty clear. Therefore, I would ask him not to throw in that kind of red herring. It is similar to the other one to frighten mothers who will be entitled to the new child tax credit.
Indian mothers will file, with the help of other Indians on the reserves, a form that will entitle them to a child tax credit of $200 per child. It will bear the name "child tax credit". It will bear the name "tax". However, hon. members know it has nothing to do with a tax in the sense of income tax. The hon. member knows that, so why play games? I do not understand his question. It does not have anything to do with income tax for Indians living and earning money on reserves.


Arthur Jacob (Jake) Epp: Mr. Chairman, the minister knows full well that the official opposition has endorsed the $200 per child. I therefore suggest to the minister, in her frustration of not having looked at this bill carefully, that she not try and pull that kind of a stunt, making the allegation that a member on this side of the House gave her the impression that he was not in favour of the $200 per child credit for children who are status Indians. The minister should know that.


Monique Bégin: Good.


Arthur Jacob (Jake) Epp: I am glad she finally understands it; it has taken a long time. The point we are trying to make is that there are certain procedures that native people have not had to fulfill vis-a-vis the Income Tax Act as have other people, or the Inuit people living in federal territories.
The minister has now said that a child tax credit form, or whatever she wants to call it, will be developed whereby mothers of status Indian children will apply for the $200 credit. I would like the minister to explain to which department that will be sent, her department or the tax department.


Monique Bégin: As I have often said in the House, and the hon. member for Provencher may have missed it, the 1.5 million mothers in Canada, including Indian mothers living on reserves, who are non-filers will send the form to the tax address which will be on that form. What is the difference between a mother who is on welfare or one who makes so little money that she is a non-filer, and an Indian mother in that regard? That is why I asked the question. I am very pleased to have clarification of where the official opposition stands.


Arthur Jacob (Jake) Epp: May I then ask the minister whether native people need a social insurance number.


Monique Bégin: Mr. Chairman, everyone connected to the tax system will need a social insurance number as per the act.
902

Family Allowances


Arthur Jacob (Jake) Epp: Has the minister checked with her colleague, the Minister of Indian Affairs and Northern Development, whether the native people of Canada approve of that move?


René Bégin: I have nothing to report, Mr. Chairman. We have no suspicion of a problem there.


Arthur Jacob (Jake) Epp: Can we have an assurance from the minister, before we complete committee of the whole stage of Bill C-10, on the position of the Minister of Indian Affairs and Northern Development as to the requirement of status Indians who will apply for this tax credit with regard to whether they will need a social insurance number?


René Bégin: Mr. Chairman, I can give that assurance to the committee tonight. In the discussion of and decisions taken on this bill, the Minister of Indian Affairs and Northern Development was particularly pleased with the fact that it will cover the Indian mother in the way that it will cover other Canadian mothers. I have his whole support, I can assure the committee of that.


Some hon. Members:: Hear, hear!


Arthur Jacob (Jake) Epp: The minister this afternoon spent a fair amount of time hurling a good bit of invective at members on this side, arguing that they should approach the provincial ministers of health with regard to the tax credit to ensure an equivalent amount will not be removed from the provincial welfare payments. She became excited about the possibility of provinces in fact reducing the provincial welfare payout commensurate with the amount of the tax credit. The hon. member for Cape Breton-East Richmond raised the same spectre-that provinces have done this in the past.
Status people are a direct responsibility of the federal government. I am speaking about those living on reserves and in national territories. I am not speaking about those who have left the reserves. Does she have assurance from the Minister of Indian Affairs and Northern Development that the amount of welfare now paid to status people will not be reduced by a commensurate amount of the tax credit?


René Bégin: I answered that question earlier tonight, Mr. Chairman. As to the analogy of the provincial governments, I would be pleased if the hon. member for Provencher were bringing me a reply to my letter from the hon. Bud Sherman. I do not have any news from him as to the way he will treat the new child tax credit, but I anticipate the Manitoba government will follow good politics at no cost, except the cost to federal taxpayers, and pass that credit on to the children in the province.


Arthur Jacob (Jake) Epp: Mr. Chairman, I can ask the Manitoba minister of health and social development for that assurance. I am not sure whether the minister needs me as a mediary, but if relations are that bad, I am willing to perform that duty. The same can be said about her reply from Prince Edward Island.
The point I am trying to make with this minister is that while she has made the point about the provinces, this govern-

ment has direct responsibility for status people. She cannot blame the provinces for not taking their responsibility. She cannot blame any organization. The buck stops right here with this government. Has the Minister of National Health and Welfare discussed this matter with the Minister of Indian Affairs and Northern Development-yes or no? If she has, did she receive the assurance that the amounts payable to native people will not be reduced by the amount individual families will receive pursuant to the tax credit?


Monique Bégin: Mr. Chairman, I said earlier tonight-I thought the hon. member for Provencher was here-that I did write to the Minister of Indian Affairs and Northern Development about this very matter.


Arthur Jacob (Jake) Epp: The minister says she wrote to her colleague. We write many letters to this government, but we do not get answers. Did the minister receive an answer relating to this matter?


René Bégin: I answered earlier.


Arthur Jacob (Jake) Epp: Is the minister choosing not to answer that question? Has she no answer? Has she not received an answer?


Mr. Railton:: You are off the bill.


James Aloysius McGrath: That is a proper and very important question.


Arthur Jacob (Jake) Epp: I am right on the bill. The point of the matter is that hon. members opposite do not want to answer questions. All this government wants is a rubber stamp for its legislation.
I say to the minister and to the hon. member for Welland- especially to the hon. member for Welland-that they have no concern for native people. In fact, the Parliamentary Secretary to the Minister of Finance gave the impression today that in his mind Indians do not count.


Alan Gray Martin: Mr. Chairman, I rise on a point of order. I would like to describe that as being a very cheap shot. I am sure the hon. member for Provencher knows that what he says is not the case. I put forward the argument-which I know was not acceptable to the hon. member for Churchill who was posing the question at the time-that getting into the matter of how best to handle welfare payments to Indian children was not perhaps related to any one of the clauses in this bill. However, we did go into further debate, and I believe every question put by the hon. member for Churchill was quite adequately answered.


Cecil Morris Smith: No, not yet.


Alan Gray Martin: I hope the hon. member for Provencher will take back the comment he made relating to my position on Indians. I have never made any such statement.


An hon. Member:: Withdraw.
November 7, 1978


Samuel Victor Railton: Mr. Chairman, I rise on the same point of order. I would like to correct the hon. member for Provencher, who intimated or made the accusation that because I was trying to keep him on the bill, which he wandered away from for a long time-


James Aloysius McGrath: Who woke you up Doc?


Samuel Victor Railton: -I was not interested in Indian people. I happen to be very fond of the aboriginal people of Canada. I think they need our support until they make the transition to a more lucrative or prosperous way of life. However, this has nothing to do with the bill in question. This bill is clearly about family allowances and how they are going to be administered. Having made that correction, I hope future questions will be about the bill.


Gérald Laniel: I must say that the point raised by the parliamentary secretary is accepted as a point of clarification. As to the point raised by the hon. member for Welland, I am sure hon. members will accept the doctor's faith and beliefs.


Arthur Jacob (Jake) Epp: Mr. Chairman, I intend to continue my questioning despite the intensity of hon. members opposite, who obviously do not want to answer questions in this area.


Mr. Boulanger:: You are wasting time and you know it.


Arthur Jacob (Jake) Epp: As long as Your Honour will allow me to continue questioning, which obviously means your Honour feels my questions are related to the bill, I will not listen to the hon. member for Welland, whether he thinks my questions relate to the bill or not. As long as Your Honour thinks my questions relate to the bill, that is good enough for me.


James Aloysius McGrath: Doc is on the record. That is the important thing.


Arthur Jacob (Jake) Epp: The question I am trying to raise with the minister is simply whether native people will receive the same benefits to which everybody else is entitled. That is one point. The second question relates to whether they will receive their benefits in a manner which will not violate agreements held or understood. Third, the minister has chosen not to answer the question about an assurance from the Minister of Indian Affairs and Northern Development as to what his department will do when these tax credits go to the mothers of status Indian children.
I suppose we will have to wait and see whether we can ask that question of the Minister of Indian Affairs and Northern Development directly, but I want the record to show clearly that the Minister of National Health and Welfare has either chosen not to answer that question or does not have an answer.


Mr. Harquail:: She has answered it twice already.


Arthur Jacob (Jake) Epp: I will simply leave it at that. I would like to get to another point. Speaking at second reading of this bill on October 31 the Minister of Finance mentioned that there would be a $35 million saving in the next fiscal year over and
Family Allowances
above the amount of money which would have had to be expended if the present family allowance plan had remained in place. I would like to ask the parliamentary secretary or the Minister of National Health and Welfare about the annual administrative cost of paying out 12 monthly cheques on each account. A family receives 12 family allowance cheques per year. What is the administrative cost per family at the present time under the present plan?


Monique Bégin: Mr. Chairman, I want to say very clearly to the hon. member, who acts like a Crown attorney, that 1 have not refused to answer. That is a pure fabrication in his mind.
I am suffering from a sore throat. That has been obvious to my colleagues for two weeks. I wish there was a rule providing that I should not have to repeat answers to the same questions. However, I will repeat once more. I have given this answer fully at least twice earlier tonight.


Maurice James Harquail: This is the third time.


Monique Bégin: The hon. member for Provencher either does not listen or he is having fun instead of doing his work. The new child tax credit will not violate any agreement with Indians. Does the hon. member think we would present legislation to parliament which would violate agreements with Indians? That is a very strange question. I said quite clearly to the hon. member, who was killing time, that the treatment of the child tax credit for Indian children will be the same as for any other Canadian children. I want to repeat that. I hope the hon. member understands. I could put it in writing for him. In this regard I wrote to my colleague, the Minister of Indian Affairs and Northern Development, in a way similar to the way I wrote to my provincial counterparts. I have not received a written reply from my colleague. I hope that is clear to the hon. member now.
On the question of the administrative cost of sending out family allowance cheques, I will have to check the question to see how the hon. member wants it answered. If he wants to know the cost per family of sending out family allowance cheques, I know it is the lowest administrative cost of all programs but I will provide him with exact details.


Bob Rae: I do not have many questions and those I have will not, I think, strike fear in the hearts of members on the other side or cause much surprise because they have been raised by my leader and by other hon. members here. However, for purposes of clarity, I should like to state, first of all, that while I agree with the minister that the discount rate is 15 per cent, when we talk about that rate on an annual basis it is 60 per cent. The government requires under Bill C-46-I would refer my friend to schedule 1 under the bill, and in particular to the last column to be filled out by the tax discounter-that the discount rate as an annual rate be 60 per cent. That is what I was saying in my comments earlier. I would be interested to hear the minister on this, but I want to make it perfectly clear for the record. I was accused by some hon. members of not knowing what I was talking about. There are many times when
80065-58V2

November 7, 1978
Family Allowances
I do not know what I am talking about, but this time I think 1 do.


An hon. Member:: Are you sure?


Bob Rae: I am sure this time. On a Master Charge or a Chargex account we pay the rate of 1.5 per cent a month. That is an annual rate of interest of 18 per cent. Similarly, the discount rate of 15 per cent expressed as an annual rate of interest is 60 per cent. That is what the government is telling discounters to charge, and that is what they have to state. That is the first part of the point I wanted to make.
The second part of the point I want to make is that when Bill C-46 was first drafted and brought before the House-let me say again that I do not say this in a spirit of antagonism toward my friends opposite but in a spirit of conciliation in order that we get the most we can for the people for whom this money is intended-it did not anticipate, I suggest, the creation of this tax credit scheme. According to the minister's own figures, about 1.5 million people will be filing a new tax form which they have never filled out before, and they will be in receipt of a sum of money which they have never received before.
What I am saying to the minister and to her colleague is this. If the government is not prepared under this bill to look seriously at this problem-and this is not a fictitious problem but a very real one-it will be in trouble. I say to the minister, with respect, that when she is asking me to tell my constituents to please not get their $200 less a discount of $30 in January or February but to please wait for their payments until March or April, she must recognize that these are not the wealthiest people in the world. I do not have the right to tell these people to hold off, nor does the minister. We are dealing by and large with people who are on welfare, who do not file income tax returns. Although 1 have been accused of assuming too much knowledge about the circumstances in which these people live, I think I am entitled to say that people living on welfare will certainly be interested in getting hold of $200 or, as it is now magically reduced, $170, as soon as possible.
I say to the government very seriously that I know they have special economic reasons for having to raise the interest rate to the usurious rate of 10.75 per cent, but in the name of heaven let them realize they have no obligation to subsidize the tax discounters in our country to the tune of several millions of dollars, which will be the result of this legislation. I would like some indication from the minister as to the government's willingness, if the government is not prepared to move on this front now, to at least give serious consideration to the payment of this money in quarterly instalments, not as an annual payment.
I think it was my friend-the hon. member for Saskatoon-Biggar who raised this as an issue brought forward by the national anti-poverty organization. I made that point in my comments at second reading and I repeat now-I do not say this in order to score points with the minister-that I am concerned that government money is paid out to people who need it, not to the tax discounters.
[Mr. Rae.)
I think the government is hung up on this criminal rate of interest which is getting it into many problems and, with which I do not agree. But quite apart from this, when Bill C-46 was passed, the government did not anticipate the legislation before us now. Under this bill the government is creating a subsidy for these people which was never anticipated at the time it allowed income tax discounters to charge 15 per cent. I am saying to the minister that giving speeches and asking people to please hold off for three months will not work. Once she has found it will not work, I hope she will come back to the House and say: "Let us send out payments to those people every quarter." At least this would ensure that people will not have to wait for large chunks of money from the government, 15 per cent of which, in my opinion, is guaranteed to go into the hands of the usurers in our major metropolitan centres.


Alan Gray Martin: Mr. Chairman, the hon. member raised a couple of points in connection with the tax discounting bill. The first point which should be made is that, whether or not all members of the House consider Bill C-46 perfect, it did indeed address itself to a particular problem which many people were facing in recent years, when they went to these people in the tax discount game and paid large interest rates on the advance payments which they received. This bill does limit the rate that the tax discounters charge to 15 per cent of the total amount being claimed. If that amount is outstanding for a year, it is a higher rate of interest. But let me point out that it is not being paid as a rate of interest but rather as a charge, and the point to bear in mind is that the charge cannot be greater than 15 per cent of the amount involved.
I do not think that when a bill is passed in the House members can anticipate what the future legislation will be in years to come. When the tax discount bill was passed, it was meant to deal with a particular problem at the time. I know the hon. member represents a riding that is adjacent to mine but for one riding between us, and we have a similar mix of constituents. I am very hopeful that people in his and in my constituency, as well as those in all constituencies throughout the country, who will be benefiting from this new tax credit, will avail themselves of the services of some of the professional accounting houses or of voluntary groups which offer services at a minimal fee, to assist those who have difficulties in filling out the very simple form which will be required under the circumstances.
The only analogy that I can draw is in the present situation in Ontario. Both of us represent Ontario ridings where people can apply for a property tax credit, and I believe that credit applies in some other provinces as well. In terms of the calculation required, this particular credit will be easier for the individual making the claim and, the form will be simpler to fill out than the one which people in Ontario are presently required to fill out in order to obtain the Ontario property tax credit. So far as I know, taxpayers generally have found they can cope with the Ontario property tax calculations, and indeed many people are receiving that credit who would not otherwise be income tax filers. So I think the same sort of thing will apply here.
November 7, 1978

I am sure all hon. members hope that, as result of this bill or any future legislation involving credit of this kind, we will not be faced with an offshoot of the tax discounters business which Bill C-46 last year attempted to address. I am sure that is the hope of all hon. members. Obviously, in the first year this credit is applicable people will run into certain difficulties. Once they have had one go at it, it will be a very routine procedure in subsequent years. It is similar to what happened when the Ontario property tax credit was introduced. Now that is a simple ritual which people go through year in and year out. Many people receive the credit even though they are not otherwise taxpayers.


René Bégin: Mr. Chairman, perhaps I can comment on this. To make certain that no tax discounting is possible, the cheques are non-assignable. We have looked into that. I am familiar with non-assignability because when I was minister of national revenue the province of British Columbia asked me to look into that matter very closely. For instance, family allowance cheques are non-assignable and therefore cannot be cashed at tax discounting offices. A tax rebate cannot be non-assignable. Under the present system in Canada it is impossible. In the eyes of the income tax system, this payment is considered to be a tax refund. From that point of view, non-assignability is a technique of controlling tax discounting.
The possibility of several instalments rather than an annual lump sum in future years will be looked into. I will monitor these lump sum payments very carefully. I should like mothers to express their viewpoints. The two major factors which could lead us to reconsider this in future years would be the budget difficulty which is being created eventually for families and tax discounting practices. It is up to mothers to tell us whether they prefer a lump sum payment once a year or several instalments. In future years-not this year-we could move toward a system of several instalments.


Bob Rae: Mr. Chairman, I do not share the optimism of the Minister of National Health and Welfare and her parliamentary secretary, but I appreciate that they are willing to look carefully at the administrative repercussions of this measure.
Referring to the matter of non-assignability, surely where there is a sovereign parliament anything is possible, provided the will is there. I do not accept the argument that it is not possible to make this form of credit a non-assignable security or something which cannot be borrowed against.
I think my second point has been talked to death, but I should like to give an example. The hon. member for Egmont was the first member to raise this on the first night of the debate. He was concerned with the fact that the chairman of the Human Rights Commission wrote a letter to the minister dealing with the possibility of this provision being discriminatory. Then we received the opinion of the Minister of Justice which indicated that the Income Tax Act was not an infringement of the Bill of Rights. That should come as no surprise, since the most recent supreme court decision in this matter was that the Bill of Rights has no cutting edge. If the Bill of
Family Allowances
Rights has no cutting edge against the Unemployment Insurance Act, surely it will have no cutting edge against the Income Tax Act. That does not mean it is not discriminatory; it means that we do not have an entrenched Bill of Rights.
I should like to refer to a common law relationship in which the woman earns $13,000 and her male friend earns $20,000. Under this scheme, their children would qualify, whereas the children of a wife and husband in similar circumstances would not qualify. I am not here to score any particular points. The minister has expressed her opinion, which I suggest was somewhat offhand. She suggested that the submission of the chairman of the Human Rights Commission was invalid. I do not think it was invalid. If my example is true-and I see that the minister is nodding-


Monique Bégin: No, I am not nodding.


Bob Rae: Is the minister going to sleep?


Monique Bégin: Absolutely not.


Bob Rae: If my example is incorrect, perhaps the minister can correct it. It is my distinct impression that a couple cohabiting in a different form of sin than that referred to by the hon. member for Edmonton West is able to claim a benefit for their children, whereas if a joint income tax return is filed as required by the act by a married couple, their children will not benefit.
This seems to be a common problem. In the spirit of conciliation, perhaps we can receive an agreement from the minister that she is prepared to look at it again, rather than dismiss the point out of hand because it comes from this side.


Monique Bégin: I am so concerned about the status of women that I would not dismiss it lightly. As I indicated the other night, from a legal point of view the opinion of the Minister of Justice is that this bill has no discriminatory features. The hon. member for Broadview referred to the Income Tax Act, which is a bill in itself and another matter altogether. It is not for me, the House or the commissioner of the Human Rights Commission to judge a bill in terms of a common law situation. I repeat that the letter of Mr. Gordon Fairweather is very ambiguous. People are still reading it and wondering what he actually meant.


Walter David Baker: No, they are not.


René Bégin: Well, the hon. member for Kingston and the Islands referred to one sentence in the letter, and other members have referred to other sentences.


Some hon. Members:: No, no!


Monique Bégin: In the second paragraph of the letter Mr. Fairweather referred to marital status. Since it is ten o'clock, perhaps I can continue tomorrow.

November 7, 1978
Adjournment Debate


Charles Robert Turner: Since the minister has not completed her remarks and hon. members are questioning those remarks, perhaps it is a good time to call it ten o'clock.
Progress reported.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Jean-Robert Gauthier (Ottawa-Vanier):: Mr. Speaker, on March 9 last the President of the Treasury Board (Mr. Andras) announced that the government plans to introduce a bill to amend certain elements of the public service pension plan as concerns the indexation of pensions to the cost of living. A lot has been written about the special study on the provisions of public service pensions in the context of the government expenditure restraint program. In its publication Consensus, the National Coalition of Citizens said that it was abusive or exaggerated to index the pension plan of public servants, suggesting that federal public servants have a better pension plan than most employees in the private sector, and even saying that indexing these pensions would lead the country into bankruptcy.
The National Coalition of Citizens was firmly against indexing public pension plans. However, there is no need to prove that this Liberal government is aware that it must protect our retired people against the thief of inflation. Inflation takes away the assets of those who are on a fixed income. Inflation also affects the various groups of pensioners and widens the gap between the income of those who work and those who are retired. The indexing of pensions protects pensioners by readjusting their income according to the increase in the cost of living. This does not increase their purchasing power, but simply maintains it at the same level.
The financing of public service pensions is perhaps the most badly misunderstood aspect of the plan. This is not surprising since the financing of pensions is complex and very technical in nature. To better understand the present financial provisions, it should be remembered that they are governed by two separate and very different sets of rules. One applies to the financing of basic pensions and the other to the financing of indexation payments.

Basic pensions are fully funded, to use the terminology of actuaries. In other words pensions are financed in such a way that if the plan were suddenly discontinued the pension fund, without any additional contribution but with future interests, would indeed meet pensions payments to all present pensioners or their survivors as well as all pension entitlements of present employees earned before discontinuation of the plan.
Mr. Speaker, I do not have the time to explain in detail the source of funds which allow the financing of the plan. To put it briefly, funds come first from contributions of employees who pay 6.5 per cent of their salary, second from the employer contribution which is equal to that of the employee, third from an employer contribution to make up any actuarial deficit like a wage increase and so on, and fourth from the interest accumulated on amounts credited to the account.
In other words pensions are financed along the same actuarial principles as those usually used for pension plans in the private sector. So it is untrue that the whole public service pension plan is financed on a day to day basis. On the contrary, basic pensions are fully funded in a government account; both employer and employee pay enough into that account to keep it on a sound actuarial basis.
Furthermore, the pension account is increasing every year thanks to the significant accumulation of interests.
The matter with which we are dealing tonight concerns the financing of pension indexation which is based on completely different rules. Since April 1, 1970, all federal civil servants have been contributing one half of one per cent of their salary to the supplementary retirement benefit account. Honourable members will recall that in January, 1977, this contribution was raised to 1 per cent of the salary. It is the indexation issue which interested public opinion and which, we must admit, has been violently criticized by several observers. Mind you, Mr. Speaker, it is true that a real problem exists with regard to the automatic clause on pension indexation. Being aware of it the government asked that a study be made with a view to obtaining an independent opinion on the various aspects of pensions in the civil service.
The Tomenson-Alexander Associates study, tabled in the House by the minister on March 9 last, showed that if the pension plan were based on full funding, the non-capitalized actuarial debt would be very high. Bearing in mind the hypotheses formulated by the consultants, specially on interest income, full integral funding based on anticipated interest income proved to have actuarial weaknesses since the indexation was a continuous and automatic legislative commitment. In other words, doubts were expressed about the capacity of the program to generate sufficient funds to pay a continuous and automatic indexation. Last March, the President of the Treasury Board (Mr. Andras) announced that he would be tabling a new bill limiting the legislative commitment on continuous and automatic indexation. He added that the rate of indexation would be reviewed on a three-year basis and that
November 7, 1978

in October he would announce the rate that would apply to the years 1979, 1980 and 1981.
Last October 19, I asked the minister, first, whether the weighted interest rate, now on the increase, would be productive enough to pay full indexation and, second, what the rate of indexation applying to pensions would be for the next three years. The President of the Treasury Board answered that he hoped to be able to announce, in October as promised, the rates proposed for the next three years. Well, we are in November and no announcement had been made to date.
I admit that the problems exist and I do not like to push the issue but I would appreciate it tonight if the parliamentary secretary could give us the assurance that within a few days the minister will be making that announcement indicating firmly the rate of indexing of pensions for the next three years.


Mr. Thomas H. Lefebvre (Parliamentary Secretary to President of the Treasury Board):: Mr. Speaker, once again 1 must congratulate the hon. member for Ottawa-Vanier (Mr.Gauthier) for raising once again a problem affecting closely his constituents who include, of course, those who have retired from the Public Service of Canada.
As you know, this principle of maintaining the purchasing power of pensions to allow those who have retired to be able to continue to have access to the same food basket and the same services is one to which the government is and remains committed. However, would the government be also committed to the principle that the provisions dealing with pensions in the public service should be fair and equitable considering their incidence on Canadian taxpayers? The government does not believe that those two principles are incompatible. The March 9 statement by the President of the Treasury Board explained how the indexing could meet those two objectives. This is contained in Bill C-12 which the hon. member mentioned and which amends the statutory right to retirement pensions.
The hon. member for Ottawa-Vanier also asks how the pensions of those who have retired from the public service will be adjusted for the next three years. 1 hope he can understand that I am not in a position tonight to tell him that but I would like to explain that the estimates and calculations that will have to be done before a decision is made are very complicated and require a lot of time. I can reassure him that this is being considered and the President of the Treasury Board (Mr. Andras) hopes to be in a position to make a statement very soon on the pension adjustment which will be proposed for the years 1979, 1980 and 1981, and I assure the hon. member that the remarks made tonight will be brought to the attention of the President of the Treasury Board.
Adjournment Debate


AIRPORTS-WINNIPEG INTERNATIONAL-FACILITIES TO ASSIST HANDICAPPED PERSONS
A. Daniel McKenzie: Mr. Speaker, yesterday I directed a question to the Minister of Transport (Mr. Lang) in which I pointed out that in 1980 the World Congress on Rehabilitation will hold a meeting in Winnipeg, that 4,000 to 6,000 of the delegates attending the congress will be handicapped persons in wheelchairs, and that the organizers of the congress had stated that the national airport will be an embarrassment to the city of Winnipeg unless facilities are built to handle the large number of handicapped people expected to attend.
The minister's answers were less than satisfactory. They were very evasive. The hon. member for Winnipeg North Centre (Mr. Knowles) posed a similar question later in the question period and the minister stated the objective was to provide facilities. The answer is not satisfactory, Mr. Speaker.
Organizers of the congress have stated that Winnipeg International Airport will be an embarrassment to the city unless facilities are built to handle the large number of handicapped people who will attend the 1980 World Congress on Rehabilitation. Many will be disabled persons confined to wheelchairs.
I wrote to the Minister of Transport on September 19 regarding the problem faced by handicapped persons at Winnipeg International Airport customs area, on escalators and in other areas. We realize that the airport was designed in the 1950s and was not completed until the 1960s, when unfortunately we did not give much thought to handicapped persons and how to handle them. I hope the parliamentary secretary will give a firm commitment tonight that some temporary or permanent measures will be taken to facilitate the handling of handicapped people at the airport before 1980.
Mr. Ruffner, the director of communications for the United States president's commission for the handicapped was in Winnipeg to help local organizers plan the 1980 World Congress and he pointed to the very serious problems they had to face. Of the 6,000 or so delegates attending the congress there could be 500 or 600 in wheelchairs. The organizers are facing problems with hotels in the city as well.
The Department of Transport has assigned $174 million for improvements to the Winnipeg airport but the program will not begin until 1982. I suggest to the parliamentary secretary that some of these funds should be allotted immediately to implement the needed improvements for the handling of handicapped persons at the airport.
I find it most disturbing to read articles in the Winnipeg newspapers about the airport, which is referred to as "bush league." An article in the Winnipeg Tribune quoted a reader, who often accompanied sick or handicapped people to and from the airport, as saying it is a disgrace to Canada. Mr. Speaker, we do not want it to be a disgrace.

November 7, 1978
Adjournment Debate
In the 1950s and 1960s handicapped persons did not receive the priority they do today. Instead of suggesting we spend more funds to expand Mirabel airport, which is a white elephant, I think we should direct funds to a problem area like Winnipeg airport. Concerned citizens of Winnipeg point out that tourists arriving from overseas or from the United States are faced with long waits at the customs and immigration areas. Staff are often not ready for the flights or perhaps there is not sufficient staff on duty. These problems must be dealt with.
I am disappointed that I have not received a reply from the minister to my letter of September 19. The hon. member for Winnipeg North Centre has been writing letters to which he has received no satisfactory answers. I hope the parliamentary secretary will give us some assurance tonight that some definite action will be taken. Never mind wanting to meet the objectives in the future; this is a very serious matter. There are hundreds and hundreds of people in wheelchairs attending this congress and they want some assurance that at least when they arrive in Winnipeg they will be properly handled. That will take a great load off their shoulders. As I say, there are problems with the hotels and other facilities around the city. I am patiently waiting and I ask the parliamentary secretary to please give us some assurance that immediate action will be taken in regard to this serious problem at the Winnipeg International Airport.
[ Translation]


Mr. Charles Lapointe (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, as the minister stated yesterday, the long-range planning for Winnipeg International Airport will produce major changes which might not be complete or in place in time for the 1980 World Congress of Rehabilitation International. This does not mean however that nothing will be done by that date. Quite the contrary. Transport Canada is giving every consideration to accommodating handicapped people attending the congress in the most comfortable manner possible and to facilitating as much as possible their transfer from the aircraft to the terminal building and inside the building.
Unfortunately, details concerning the type of aircraft and the number of wheelchair passengers attending the congress are not yet available and final arrangements to accommodate these passengers cannot be completed until this information is available.
At a meeting of the Congress Planning Committee, held in Winnipeg on May 2, 1978, it was determined that 7,000 to 10,000 delegates might attend the congress. Of this total, it is anticipated that some 400 persons will be physically handicapped. In addition congress delegates will be using various modes of transportation including train, automobile and aircraft. This means then that they will not all come through the Winnipeg airport. Furthermore the majority of delegates are

expected to come from Ontario and the United States and it is anticipated that many delegates will combine the congress with holidays and travel by car. It should be emphasized again that not all delegates are handicapped and of those handicapped not all will be using wheelchairs.
With this in mind, Mr. Speaker, a number of proposals are being considered for Winnipeg International. For those aircraft that are not able to connect to the terminal loading bridge, hydraulic lift vehicles can be used. They can be raised to the level of the aircraft door and lowered to ground level. The people arriving would then be transported to the first level of the terminal building. For those aircraft that can connect to the terminal loading bridges, and therefore the second level of the terminal building, a portable elevator can be installed which would accommodate wheelchair delegates as well as other handicapped persons such as the blind.
In addition to the above possibilities, adequate staff will be present to assist wheelchair delegates from the escalators, if they so choose. Special security and customs arrangements have been agreed to ensure the efficient processing of all delegate passengers. I must emphasize, Mr. Speaker, that until more information is made available concerning the number of wheelchair passengers, the proposals mentioned above cannot be considered as final. Again let me assure you every consideration will be given to accommodate congress delegates and no apparent difficulties are anticipated.


PUBLIC SERVICE-RELOCATION AND RETRAINING OF EMPLOYEES WHOSE JOBS DECLARED REDUNDANT
Mr. Lloyd Francis (Ottawa West):: Mr. Speaker, on August 15 the President of the Treasury Board (Mr. Andras) announced a program of cutbacks which he thought could involve 5,000 positions in the public service of Canada which might be declared redundant. It is quite clear that not all of these positions are occupied but the people in such positions might find themselves surplus to requirements.
The Public Service Commission responded to this situation on September 22 with a priority clearance procedure. In brief, through the delegated authority provisions the commission said no new staffing would take place unless an opportunity was afforded those people who held positions that were declared redundant to qualify for the positions that were available. Staff associations have asked for a total freeze on the filling of positions from outside the public service during this period. The Public Service Commission has resisted this and so has Treasury Board on the theory that a total freeze is not required. Remember, we are talking about perhaps 3,500 people in a public service of over 300,000. It certainly should be possible with an orderly procedure in the ordinary course of turnover and attrition to take care of every one of these 3,500.
There is a concern that the way the policy is now being put into place is inadequate. I am looking at the November issue of the "Argus Journal" of the Public Service Alliance. They
November 7, 1978

point out that the procedure is not to go into effect until November 15. They would like to see it placed in effect immediately. They would like to see that employees who face lay-off and who secure employment outside the public service receive their lay-off notice so that they can receive severance pay immediately. They are also asking for the waiving of all pension penalties for early retirement due to lay-off. These seem to be eminently fair and reasonable requests of the government as an employer, in the circumstances.
What is called for is something more than just saying if a person is qualified and a position becomes vacant, he has some kind of priority. A number of us who represent the national capital region-and I see my colleague from Ottawa-Vanier (Mr. Gauthier) in the House this evening-have been saying that the government has an obligation to bring about a major retraining program for those who are affected. It is not easy to establish the program until you know precisely the numbers, in what departments they are employed and in what categories. These facts have not yet been established. The departments are in the process of working within the over-all cuts that have been imposed upon them in determining precisely where the redundancy notices are to be given. A plan has to be formulated for dealing with the situation and upgrading employees so that they can qualify on the basis of merit for the opportunities that present themselves.
I hope the Government of Canada will not say it is going to wait for the report of the D'Avignon commission, which is studying the merit principle within the public service and will no doubt be looking at training, and that this is outside what we are going to do. The situation is urgent. The need for planning is now.
The Public Service Commission, faced with a redundancy of 600 language teachers, put into place a special program to deal with that group within its own staff. The 600 are now down to 416 through the normal process of attrition and transfers. It is my sincere hope that the Public Service Commission will be a demonstration to the rest of the public service of what can be done to guarantee fair treatment to those who are affected.
Perhaps this would be a good time to refer to one other matter. I cannot help but feel, as my colleague the hon. member for Ottawa-Vanier has said in this place on a number of occasions, that the retraining procedures within the public service of the Government of Canada are not adequate, and the case for a central training institute is a strong one. If one were in place at this time, it certainly would be of assistance in dealing with the very difficult situations which are coming to our attention.
Perhaps retraining is not the answer for the gentleman who sent me a letter today. This gentleman is 61 years of age and has 23 years of honourable public service and an incredible record of a professional nature. He received his redundancy notice just this week.


Mr. Knowles (Winnipeg North Centre):: Shame.
Adjournment Debate


Cyril Lloyd Francis: Yes, I feel ashamed about that, but it is my sincere hope that the procedures which are put into place will give this gentleman an opportunity to serve to the normal retirement age, which he had every reason to expect and which his health and capacities would permit under normal circumstances. I think that the Government of Canada has an obligation not only to follow through with the priority clearance procedures which are established but also to do a good deal of retraining.


Thomas Lefebvre: Mr. Speaker, the hon. member for Ottawa West (Mr. Francis) has, as usual, brought to the attention of hon. members of this House and of the government another subject which is of concern to him on behalf of his constituents. He has thereby upheld his record of representing very well the people of his constituency who are members of the federal public service. That is a record of which he can be proud.
As the hon. member may know, government policy officially supports retraining within the public service, particularly to enable surplus employees to take on new duties. Through this policy the government hopes to avoid many lay-offs. The government has made it very clear to deputy ministers and officials responsible for staffing and training that retraining will be undertaken where it will enable a surplus employee to perform the duties of a new job. Deputy ministers have been given authority to provide formal classroom training which can exceed even the normal three-month maximum suggested in Treasury Board policy.
Retraining is common practice now, of course, since every employee new to a job must learn his duties and, in effect, is given on-the-job training. Depending on the learning required, this can be extensive, and more and more Treasury Board and the Public Service Commission are encouraging managers to view employees as flexible and adaptable and to make the most use of on-the-job training for new assignments. I emphasize that such practices apply with special force to surplus employees.
The costs of this kind of training are absorbed into normal operating budgets, and allocation of new funds by Treasury Board for this purpose appears unnecessary. Costs of formal training are separate items, but they too have to be funded from within existing budgets.
Finally, I should like to remind hon. members of the government's strong financial support for retraining generally to help Canadian workers adjust to new work. The programs of the Employment and Immigration Commission serve this purpose. These programs are available to public servants and, as I have outlined previously, a special task force in the commission will be making them aware of this retraining.
Another subject allied with this matter is relocation. The government's policy is to pay the expenses of moving surplus or laid-off employees. They will be reimbursed in the same way as other public servants moved to new jobs. This policy

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Adjournment Debate
should help ensure continued employment for these public servants.
Costs of relocation should be absorbed within existing departmental budgets, and I do not expect special allotments to be necessary.
I wish to thank the hon. member for presenting his case to this House, and I assure him that the President of the Treasury Board (Mr. Andras) will be made aware of his remarks.


Mr. Deputy Speaker:: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until two o'clock p.m. tomorrow.
Motion agreed to and the House adjourned at 10.31 p.m., without question put, pursuant to Standing Order.

Wednesday, November 8, 1978