1978-05-10

ROUTINE PROCEEDINGS


Mr. Donald W. Munro (Esquimalt-Saanich):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. Because of the importance of the matter and the wish to strengthen the hand of the Minister of Fisheries (Mr. LeBlanc) in these difficult days, I hope I will be granted unanimous consent.
In view of the injunction issued in the state of Washington last week, designed to prevent Canadian fishermen on the west coast from drawing all expected advantage from the interim agreement worked out by the two negotiators for the purpose of providing a temporary legal umbrella under which the fishermen of our two nations could fish in the waters of our two nations under certain conditions, and under which, as well, the negotiators could push forward toward a definitive bilateral agreement covering fishing rights and obligations, on the one hand, and an acceptable delineation of the boundary between our two zones of national jurisdiction, on the other, I move, seconded by the hon. member for Surrey-White Rock (Mr. Friesen):
That this House instruct the Minister of Fisheries to notify U.S. authorities immediately that any application of the injunction granted last week by a Washington judge, under which Canadian fishermen would be prevented from fishing in U.S. waters in accordance with the terms of the interim agreement, would create a completely new set of circumstances in the bilateral talks and would, specifically, have two immediate and unfortunate consequences, namely, a total prohibition applied to U.S. fishermen who might otherwise have been able to fish, for the time being, in Canadian waters in accordance with the terms of that interim agreement-


Mr. Speaker:: Order, please. May I remind the hon. member that there is a limited time for motions pursuant to Standing Order 43.


Donald W. Munro: I am just coming to the end, Mr. Speaker.
-and a complete re-examination of Canada's stand on all issues on which interim agreement had been reached.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


INDUSTRY
Mr. Derek Blackburn (Brant):: Mr. Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity arising out of reports yesterday that the federal government has decided to subsidize the construction of two new auto parts plants by General Motors Limited and Ford Motors Limited to the tune of $116 million.
In light of the fact that the auto pact signed by Canada and the United States in 1965 commits both countries to policies that would allow the industry on both sides of the border to "participate on a fair and equitable basis in the expanding total market of both countries", I move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That the Minister of Industry, Trade and Commerce be instructed to reopen talks with the major auto makers in order to impress upon them the view that a level of investment consistent with our share of the North American automobile market is a legal and moral obligation on the part of the auto makers; that he be instructed to demand from them, within six months, plans as to how they intend to meet this quota of investment every year between now and 1985; and, finally, that he be instructed to refuse any requests for assistance from the auto makers in the form of grants or subsidies until they have presented satisfactory plans for meeting their target levels of investment and jobs in line with the Canadian share of the over-all North American automobile market.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


POST OFFICE
Mr. Jake Epp (Provencher):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. In view of the remarks of the Postmaster General (Mr. Lamontagne) in Vancouver that just as door to door milk and bread deliveries were discontinued, and hinting that a reduction of home mail delivery service from five days to three days a week may be one way of combating the $550
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May 10, 1978
million Post Office deficit, I move, seconded by the hon. member for Central Nova (Mr. MacKay):
That the Postmaster General end the confusion by stating whether it is the policy of his department to begin phasing in three times a week door to door mail delivery service.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


ELECTIONS
Mr. Tom Cossitt (Leeds):: Mr. Speaker, I rise on an urgent matter concerning the recent, obvious fact that the government and parliament are no longer running the country, which is now in the hands of an unholy triumvirate, the Gallup poll, the Goldfarb poll and Senator Keith Davey. I move, seconded by the hon. member for Winnipeg South Centre (Mr. McKenzie):
That the House deplores the failure of the government to deal with unemployment, inflation and the fallen dollar, that the House condemns the Prime Minister for withholding, up to now, an election from the Canadian people whereby they can pass judgment on this situation and, finally, that the Prime Minister request dissolution of the House by the Governor General immediately, in order to permit democracy to function and to dispel the widespread idea that the Liberal party colour has turned from red to yellow.


HISTORIC SITES
Mr. W. Kenneth Robinson (Toronto-Lakeshore):: Mr. Speaker, I rise under Standing Order 43, on a matter of urgent and pressing necessity and appeal for the unanimous support of this House. In view of the fact that the birthplace of James Shaver Woodsworth, the founder of the CCF in Canada, is in the borough of Etobicoke and is threatened with imminent demolition to become the site for an apartment building, I move, seconded by the hon. member for Vancouver-Kingsway (Mrs. Holt), who represents the riding formerly held by Grace Maclnnis, the daughter of J. S. Woodsworth:
That this home be declared a national historic site, that the government take immediate steps to prevent its demolition and take action to ensure that this home be preserved in perpetuity for future generations of Canadians.


Mr. Speaker:: Presentation of such a motion for debate can only be done with the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.
[Mr. Epp.J


PUBLIC SERVICE
[Stage Direction]
5.0.	43
Mr. Benno Friesen (Surrey-White Rock):: Mr. Speaker, in view of the complete absence of consultation by the government with the public service unions prior to the introduction of Bill C-28, and the grave misgivings it has caused, I would move, seconded by the hon. member for Grenville-Carleton (Mr. Baker):
That Bill C-28 be withdrawn until there has been open and extensive consultation with all the affected parties in the public service.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


LABOUR CONDITIONS
[Stage Direction]
5.0.	43
Mr. Paul Dick (Lanark-Renfrew-Carleton):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing business. During the summer of 1976, the government, in an attempt to conceal the poor performance of its summer job-creation program, cancelled the summer student employment survey. Through public pressure, it was forced to reinstitute this survey in 1977.
Now that the summer of 1978 is almost upon us and university and secondary school students are about to enter the labour market, we find that the government has again discontinued the student summer employment survey, as a result of which student summer employment will no longer be reported by Statistics Canada. Since this will make long-range planning impossible for both the private and public sectors, I would move, seconded by the hon. member for Leeds (Mr. Cossitt):
That the government stop playing games with the future of Canada's young people, undertake to be forthright in the reporting of student unemployment, and stop trying to hide its job-creation failures by deleting reports; and further, that the student summer employment survey be conducted through the summer of 1978.


Mr. Speaker:: Such a motion requires unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



May 10, 1978


CANADIAN WHEAT BOARD
Mr. Cecil Smith (Churchill):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. A steady movement of grain from the prairies through Prince Rupert and Vancouver would appear to present problems which the government has been unable to correct. The port of Churchill is the most efficient grain handling port in Canada and is not being utilized to its full capacity. I would therefore move, seconded by the hon. member for Provencher (Mr. Epp):
That the minister responsible for the Wheat Board direct an increase in grain shipments through the port of Churchill for the 1978 season by a minimum of five million bushels.


Mr. Speaker:: The motion can be debated only with the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


EXTERNAL AFFAIRS
Mr. Walter Baker (Grenville-Carleton):: Mr. Speaker, I rise on a point of order with respect to proceedings under Standing Order 43. It relates to a matter raised in the House on Monday by my hon. friend from Edmonton Centre (Mr. Paproski) when he sought unanimous consent for the following motion:
That this House reaffirms the right of the State of Israel to exist in peace with its neighbours, and further reaffirms the right of Israel to secure borders consistent with the need of all the peoples of the Middle East for a just and lasting peace.
Your Honour called for the consent of the House on that occasion, and the government House leader said this:
Mr. Speaker, this is an important motion and we would like to consider it before registering an opinion. Perhaps it could be held over until tomorrow.
As you know, Mr. Speaker, the House adjourned yesterday because of the tragic death of the Hon. Aldo Moro. Could the government House leader now indicate the feelings of the government with respect to this motion, so that it might be proceeded with today if your Honour agrees with that procedure?


Mr. Speaker:: Perhaps the more appropriate thing to do would be to put the question immediately.


Hon. Donald C. Jamieson (Secretary of State for External Affairs):: With regard to the matter the opposition House leader has just raised, I may say there is no objection except as far as the precise wording of the motion is concerned. I should have been in touch with the hon. member this morning: it is my error. It is not a matter of the substance, but on questions
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of this kind I believe the wording should conform to that which is traditionally accepted in connection with these matters. If I might have the indulgence of the House for another day, I can assure the hon. member there will be no problem tomorrow.


Mr. Paproski:: I agree, Mr. Speaker. I will consult with the Secretary of State for External Affairs.



ORAL QUESTION PERIOD


Mr. Lloyd R. Crouse (South Shore):: Mr. Speaker, I wish to direct my question to the Minister of Fisheries and the Environment. In light of the open and apparent disagreements and conflicts in policy which have been so evident over the past few months between the federal Minister of Fisheries and the Environment, provincial premiers and provincial fisheries ministers, can the federal minister indicate whether there has been some reconciliation of views or a common approach to the very serious problems affecting our east and west coast fishermen, and can he indicate whether there has been a final solution to the inadequate policing and surveillance of fishing quotas which presently exist within the 200-mile limit?


Hon. Rom6o LeBlanc (Minister of Fisheries and the Environment):: Mr. Speaker, in the consultations we had with provincial ministers in December and February there was general agreement as to the policy direction which should be taken. I recognize that provincial ministers will differ in degree with some of the policies we are putting forward, but the fact remains-I have indicated this before-that I cannot delegate and, in fact, the constitution as it is presently written does not allow me to delegate the final authority for management of the fisheries.
On the second question raised by the hon. member, there have been reported acts of violation. Legal advice is being sought as to whether identification of fishing vessels' locations by plane will stand up in court. If they will, violators will be taken to court.


Lloyd Roseville Crouse: Mr. Speaker, since the fishing industry needs a program covering the licensing of inshore and offshore vessels which will ensure the present balance in the catching capacities of these two segments of the industry, plus a licensing policy which will permit Canadian-owned freezer trawlers to catch some of the quotas of silver hake, squid, round-nosed grenadier and capelin which are being allocated by the present government to foreign countries, will the minister agree to meet with his provincial counterparts and fisheries' representatives in the hope that the present shortsighted policy of the
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May 10, 1978
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federal government as it relates to freezer trawlers may at least be examined and, hopefully, altered?


Mr. LeBlanc (Westmorland-Kent):: Mr. Speaker, perhaps the hon. member does not know it, but this is the second year in which there has been a fishing plan for the whole Atlantic region. The fishing plan is working astonishingly well, with regions and quotas reserved both for inshore and for offshore. This, of course, is subject to consultation with representatives of the industry, processors and fishermen, provincial governments and those who have an interest in the subject.
With regard to the second question, I have before me no applications for licensing of freezer trawlers which would take species like capelin, hake, grenadier or argentine. All the applications I have for licences-although they do mention these species in the first paragraph of the letter-always seek access to red fish, flat fish or northern cod. I have indicated very clearly that the present fleet has the capacity to catch the stocks which are available to Canada, which are over 80 per cent for 1979 and 76 per cent for 1978. The problem is not one of expansion; it is one of increasing the catch rate of the vessels which are just now becoming economical.


Some hon. Members:: Hear, hear!


Lloyd Roseville Crouse: Mr. Speaker, the minister is well aware that we do not have any freezer trawlers, and therefore we are incapable of catching and processing the soft species to which I referred. We certainly cannot accept his answer as it presently stands, because without freezer trawlers it is impossible to catch, process and market the species to which I have referred. Has there been any final solution to the Digby scallop fishermen's problem? The economy of the entire area has been threatened by the minister's arbitrary regulations.


Roméo LeBlanc: Mr. Speaker, contrary to what the hon. member says, some trawlers in Newfoundland have a freezing capacity and, in fact, they were used in the fishery in the far north in the past season. I am trying to explain to the hon. member-I am sure that as a former fishing captain he understands this-that a freezer trawler, with the type of expenditure it represents, would never be economical just fishing for underutilized species. The other species are now being caught by our fishermen and utilized in our plants. I am sure the hon. member is not suggesting that I should direct the industry to go into uneconomic ventures.
As for the question of the Bay of Fundy scallop fleet, the disaster to which the hon. member alluded is really not taking place. In fact, fishing in the Bay of Fundy and on Browns Bank had a higher catch rate last year than in the years before. I am looking at possible alternatives. However, I have to remind the hon. member, as I did the other day, that transferring the problem to another group of fishermen, although it may be temporarily popular, will not be popular when the Georges Bank fishery faces what the biologists are predicting, which is a lowering of the catch level, because the
[Mr. Crouse. 1
Georges Bank fleet will find itself with fewer and fewer scallops to catch.


CANADA-U.S. DISPUTE ON WEST COAST FISHERIES
Donald W. Munro: In view of the deterioration in the situation of west coast fisheries, particularly in light of the injunction which was issued last week, will the minister tell us what positive steps he has taken to ensure that the Canadian viewpoint is given a good hearing during the injunction proceedings before the U.S. courts?


Fabien Roy: Mr. Speaker, there is no disaster on the west coast: in fact, the fishing which was covered under a temporary agreement is going on; the injunction is not yet operative. Whether or not it will be sustained-if that is the legal term- this week remains to be seen. Meanwhile, the special negotiators, Ambassadors Cadieux and Cutler, are meeting in Ottawa tomorrow. Our point of view is well known to the United States authorities. In fact, they are before Congress now, arguing for quick passage of the temporary agreement which would contain the problem covered by the injunction.


Donald W. Munro: In light of the one-week delay in the imposition of the injunction, has the minister any special words of comfort to issue to the fishermen as they set out this weekend for the salmon fishing grounds, so that they may know with assurance that they will be able to go into those grounds freely and fish under the terms of the interim agreement? Or are they going to be harassed?


Roméo LeBlanc: They will not be harassed if the injunction is not sustained. If the injunction is sustained, then there will be real difficulty. We will meet with the special negotiator again; we are meeting with him tomorrow and on Friday. We also said that if the agreement was not respected by the other side, we would not feel bound by it.


REQUEST PRIME MINISTER PERSONALLY INTERVENE WITH PRESIDENT CARTER RESPECTING DISPUTE
Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, I should like to direct a question to the right hon. Prime Minister arising out of the hardship which may be imposed on British Columbia fishermen by the ban which has been imposed by the court in the United States with respect to Canadian fishermen operating in U.S. coastal waters.
I ask the Prime Minister if he would personally intervene with President Carter so that, if the ban is upheld, the U.S. government would undertake not to enforce it until such time as the two negotiators for Canada and the United States are able to work out a temporary agreement pending ratification of the Canadian-American fisheries agreement.


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, I should like to remind the hon. member that it was as a result of my representations to President Carter a little more than a
May 10, 1978

year ago, assisted by the Minister of Fisheries, that we obtained this interim agreement.
I should also like to remind him that the form in which his question was put is not correct, in the sense that there has not been a ban. There is a question of a ban, an injunction, before the courts now and, as the Minister of Fisheries reminded the House, President Carter's administration is fighting against this injunction. Surely that indicates that President Carter is not only aware of what Canada told him last year through the minister and myself, but is fighting to uphold the message that both of us agreed to last year. Regarding the rest of the question, the hon. member will recall that in its very form it was hypothetical.


Thomas Clement (Tommy) Douglas: Mr. Speaker, in view of the fact that the proposed temporary agreement has not been ratified by the United States Congress, there is every likelihood that the prohibition on Canadian fishermen will be upheld by the courts.
In view of the fact that Monday, May 15, is the opening of the halibut season, and that the fisheries' representative on the Pacific coast has informed already British Columbia fishermen that they should plan to continue their fishing off the Alaska coast, and I am sure the Prime Minister recognizes what could happen if there were confrontations, does he not think it is sufficiently important to take it up with the American government, so that we do not have a situation wherein British Columbia fishermen are intercepted off the Alaskan coast in the event that the prohibition and the injunction are sustained in the course of the next few days?


Pierre Elliott Trudeau: Mr. Speaker, I am afraid, once again, the question indicates that the hon. member is misinformed. He suggests that I take something up with the American government. He knows, or he should know, that the American government is on our side on this question and, indeed, is before the courts to plead our side of it. Therefore, it is of little avail to suggest that I take it up with the American government: they are on our side and they are acting in a sense for us.
The hon. member has suggested the difficulty: it is that Congress itself has not passed this agreement. But the administration is doing its best to get it passed. I do not think the hon. member would suggest that I could tell Congress what it should be doing. Neither do I agree with the hon. member when he predicts what the courts will decide. If the courts go against us, Your Honour will realize that we are in an hypothesis here and the question is hypothetical. Let me just remind the hon. member what our government, and particularly the Minister of Fisheries and the Environment, did last year when we had to apply pressure on the Americans. We banned some of their fishing in our waters.
One does not like to talk like this, because we are hoping Congress will see where justice lies in this question. Perhaps the hon. member is unintentionally provoking the government
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into making some retaliatory threats before even the cause for such threats has become evident. So I suggest this line of questioning is not appropriate.


Some hon. Members:: Hear, hear!


Thomas Clement (Tommy) Douglas: Mr. Speaker, I am not asking the government to make threats; I am asking the Prime Minister to get some assurance from the American government, if British Columbia fishermen go up next Monday to the coast of Alaska to fish for halibut, that the American government will not enforce any injunction which may have come into effect until such time as the two countries can work out an agreement.
Also, I am asking the Prime Minister to state categorically to the American government, not only here, but to President Carter, in the event that Canadian fishermen are barred from American waters that the Canadian government will have no choice but to take a similar course of action in respect of American Fishermen operating in the coastal waters of Canada.


Pierre Elliott Trudeau: Mr. Speaker, the hon. member suggests that we do not make threats; then his question ends up with a suggested threat to the American administration.


Thomas Clement (Tommy) Douglas: It is not a
threat.


Pierre Elliott Trudeau: Also, he is suggesting that I make representations to them to do something if they should lose the case they are pleading before their courts. The administration intends to win their case, which is our case. It seems very, very unproductive for me to get them to say now to the courts that if we lose, we will not do certain things, including obeying the injunction.
I should like to remind the hon. member that this situation prevailed last year when this danger existed and President Carter gave me the personal assurance that he would work out some interim arrangement. The hon. member has been told by the Minister of Fisheries and the Environment that Mr. Cutler and Mr. Cadieux are meeting tomorrow in this city. Surely it is a little premature to talk about threats, as the hon. member is doing.


Some hon. Members:: Hear, hear!


FINANCE
Mr. Gilles Caouette (Temiscamingue):: Mr. Speaker, may I put a question to the hon. Minister of Finance?

May 10, 1978
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The Information Division of the Department of Finance indicated in a news release issued on May 2 that $5,778 millions were used for loans to fishing operations throughout the country. I notice that of this amount no loan was made either in 1976 or in 1977 to Quebec fishermen. Would the minister indicate whether this is under a special agreement between the federal government and the province of Quebec or whether he considers that Quebec fishermen are rich enough to finance their operations themselves?


Hon. Jean Chretien (Minister of Finance):: Mr. Speaker, I know that there is a particular problem as far as Quebec fisheries are concerned, but I am not aware of the details on this matter. This special matter I am going to inquire on, and report to the hon. member. I do not know if my colleague the Minister of Fisheries is more knowledgeable about this than I am.


Gilles Caouette: Mr. Speaker, I should like to put a supplementary question.
Since the minister does not know whether there is an agreement with Quebec or if it is a direct instruction, can he assure us that between July 1 and December 31 this year there will be, at least if it was not the case last year or in 1976, some advertising for Quebec fishermen so that they can also obtain their fair share of special loans for fishing operations?


Joseph Jacques Jean Chrétien: Mr. Speaker, all federal programs are entirely applicable to Quebec. It is a special program but we will consider why the hon. member has come to that conclusion. However, under all circumstances we endeavour to make all government programs applicable to Quebeckers, even if it is suggested in some parts of the country that programs dealing with Quebec are more generous than those elsewhere.


FISHERIES
Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I would like to direct a question to the Minister of Fisheries. I am sure the minister is aware of the feelings of hostility by some fishermen toward the imposition of regulations that seriously affect their livelihood, without what they consider proper consultation.
Is the minister considering a directive or a general investigation to see what can be done to improve relations, not only between his department and fishermen but to co-ordinate policy among federal and provincial ministries so that inshore fishermen can be given better bait-freezing and storage facilities, improved slipways and things like this which are required to improve conditions in the industry?


Fabien Roy: Mr. Speaker, where the federal government is responsible in the case, for example, of the management of stocks, changes in the conditions of access to stocks, licensing, etc., obviously we have a very high level of consultation. In fact, I decentralized, not only to Halifax as a region and to St. John's but to area managers in places like Sydney, northern New Brunswick, etc., a fair level of authority so local problems can be dealt with by local officials in co-operation with local fishermen. I also instituted a program whereby 20 community service officers of the Department of Fisheries have the responsibility of constantly being in touch with the fishermen.
Obviously, there are times when decisions have to be made, for conservation reasons, where no level of consultation will produce agreement and at one point you simply cannot delegate the final decision to anyone. In the area of federal-provincial co-operation, it is obvious that, for example in respect of both subsidies and other programs, they are synchronized with programs such as the fishermen's loan boards of the provincial governments.


Elmer MacIntosh MacKay: Mr. Speaker, I thank the minister for his answer and I ask him, with respect-while most fishermen, I believe, will concede he has their best interests at heart-will he not take a look at the attitude that prevails among scallop fishermen, people who are concerned with aquaculture, for example, and people very much concerned that there is no sensitivity shown to setting proper seasons for scallop fishing, for example, in Nova Scotia, in order that he can be satisfied that his officials, the people he has appointed, are really doing their job in consulting with and getting the benefit of the experience the industry has? Will he give us that assurance?


Roméo LeBlanc: Mr. Speaker, not only can I give him the assurance but I can indicate the fact that when the fishermen in his own area, the Northumberland Strait area, came up with alternatives and proposals which appeared to be better than the policy which we had suggested, we were quite willing to adjust. There is a problem at times, obviously, when that fishery is in competition with another fishery-I am thinking of scallops and lobsters-or when there is an obvious need for conservation and a season may have to be shortened or a freeze on licences is required; but in this case we are trying to protect the long-term interests of the fishermen, whose continued income is obviously of great concern to us.


INDUSTRY
Mr. John C. Crosbie (St. John's West):: Mr. Speaker, I have a question for the Minister of Industry, Trade and Commerce. On January 30, the minister presented a paper to the provinces in which he pointed out that the manufacturing industry in Canada was supplying 80,000 less jobs at the end of 1977 than
May 10, 1978

it was three years earlier. In April, the Minister of Finance continued certain temporary tariff cuts that were instituted in 1973, without any quid pro quo at Geneva.


An hon. Member:: Question.


John Carnell Crosbie: Don't worry, the question is coming, hon. gentlemen opposite. My question is: What steps has the minister taken to increase the number of jobs in the manufacturing sector and, secondly, what instructions have been given our negotiators at Geneva as to which of the most vulnerable Canadian industries are to be protected by exemptions in the GATT negotiations?


Hon. Jack H. Horner (Minister of Industry, Trade and Commerce):: Mr. Speaker, we seem to go over and over this question of manufacturing in Canada. The hon. member asks what steps are being taken. I have informed the House that we have called together 22 sector studies, and involved in those studies we have management, the provincial governments and the unions. We are studying the role of governments, taxation and regulations in respect of industry; we are studying potential markets for each industry in those 22 sectors.
Having particular regard to the tariff negotiations at Geneva, I have told the House over and over again that all things are on the table: none is being exempted in the negotiations. However, if one examined that manufacturing paper, he could readily see there are five specific industries in which imports have already made great inroads into our market. One could assume from that that those five might be the most vulnerable, of course. Our negotiators are very much aware of this and we are bearing it in mind during our negotiations.


John Carnell Crosbie: Mr. Speaker, there have been sector studies going on now, it seems to me, for at least six years. Sectors are being studied more than sex these days, and I am asking for action. Let me give the minister a specific example. In the manufacturing of colour television sets, the Canadian industry sold 12,000 sets in March, compared to 22,000 last March. Five companies have closed; or the fifth one is closing in June. These are companies manufacturing colour television sets. The United States has exempted colour television sets from the GATT negotiations. It has done that now.
I would like to ask the minister, in connection with this industry-because Canadian workers and Canadian manufacturers want to know-are they to be exempt from these tariff reductions at GATT, and what other industries are to be exempt? Surely, the thousands of Canadian workers and the people who have their money in these industries are entitled to know, just as they know in the U.S.


Mr.   Homer@: Mr. Speaker, I do not know what the hon. member knows of what is going on in the U.S. I do know, though, that the U.S. put forward its proposals, we put our proposals forward, and the U.S. government and its negotiators there were not at all satisfied with our proposals. They said we had not been generous enough in our offer. Now the hon. gentlemen is suggesting to the House that we have been
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too generous. We are attempting to negotiate all stages of the negotiations. Our negotiators are bargaining very hard, as is obvious from the United States government's complaints about what we have put on the table.


URBAN AFFAIRS
Mrs. Simma Holt (Vancouver-Kingsway):: Mr. Speaker, my question is for the Minister of State for Urban Affairs. Will he inform the House when the new housing and community programs will be implemented in British Columbia?


Hon. Andr6 Ouellet (Minister of State for Urban Affairs):: Mr. Speaker, some elements of the new federal housing proposal are already in force, or will be, subject to ratification by the provinces. As for the new community services program, it will become operational after steps relevant to each province have been clarified.
In this regard I concluded this morning some very fruitful discussions with the minister of housing and municipal affairs for British Columbia who came to Ottawa with his officials specifically to discuss these proposals. I would like to draw to the attention of the House the presence of the minister in the gallery, the Hon. Hugh Curtis of British Columbia.


Some hon. Members:: Hear, hear!


INDUSTRY
Derek Nigel Ernest Blackburn: Mr. Speaker, my question is to the Minister of Industry, Trade and Commerce. Since the auto pact between Canada and the United States commits both countries to "participate on a fair and equitable basis in expanding the total market" of both countries, and since Canada has lost approximately 25,000 jobs by not getting its fair share, can the minister indicate to this House and to the Canadian people why the federal government has decided to subsidize the construction of two new auto parts plants by General Motors and Ford Motors Limited to the tune of $ 116 million?


John (Jack) Henry Horner: Mr. Speaker, I am indeed grateful for the opportunity to answer this question because I want to clear up once and for all, if I can, the whole question of the Canada-U.S. auto pact. I have a copy of the agreement with me and I will read the pertinent clause to which the hon. member is referring:

May 10, 1978
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The liberalization of Canadian and United States automotive trade in respect of tariff barriers and other factors tending to impede it, with a view to enabling the industries of both countries to participate on a fair and equitable basis in the expanding total market of the two countries-
If hon. members will look at the expanding total market since that agreement was signed, they will see that in 1965 we produced something like 855,000 vehicles and in 1976 we produced approximately 1,641,000 vehicles. So our market has expanded considerably since the signing of the automotive pact. Dealing specifically with the so-called imbalance, we have a surplus in automobile production to the tune of $2 billion. We have a surplus in the production of automobiles.


An hon. Member:: What about parts?


John (Jack) Henry Horner: The hon. member wanted to hear about parts. Let me say clearly, there are no-


Mr. Speaker:: Order, please. I will recognize the hon. member for Brant on a supplementary, but it is obvious that the general nature of the question is provoking an answer which perhpas, quite necessarily and justifiably, may be too long for the question period. Perhpas consideration might be given to dealing with it under the adjournment debate proceedings.


Derek Nigel Ernest Blackburn: Mr. Speaker, my supplementary will be very brief. In view of the fact that both these corporations are multinational giants, and in view of the fact they have an obligation under the auto pact to invest in the interests of both sides of the border, why is $116 million of ordinary, Canadian taxpayers' dollars going toward subsidizing these two huge, multinational conglomerates which should have already invested money in the parts industry in this country?


John (Jack) Henry Horner: Mr. Speaker, I will neither confirm nor deny the article that was printed in the Globe and Mail yesterday with regard to the $116 million. Let me point out quite clearly, as I did when I was ending my last answer, we had a surplus of $2 billion in automobile manufacture in Canada last year. In the automotive agreement there are no requirements put on the independent parts manufacturing and reproduction levels in Canada.
What I am saying, for the benefit of the House in answering this question, is there is no part of the automotive agreement which deals with independent parts producers. Therefore, if we have a deficit in parts, it behooves us, as the Canadian government interested in the Canadian automobile manufacturing industry, to do everything we can to entice greater manufacturing of parts and automobiles within this country. I would like to assure the House that we are doing our utmost to encourage all three of the large manufacturers to build more plants in Canada.


GATT NEGOTIATIONS RESPECTING CERTAIN INDUSTRIES
Mr. Bill Kempling (Halton-Wentworth):: Mr. Speaker, I would like to direct my question to the Minister of Industry, Trade and Commerce. Last year we had a trade deficit in

communications equipment, heating, refrigeration and domestic appliances of $2,336 billion, according to the figures from Statistics Canada. The government helped put together the CAMCO and white goods business, and their employment is down from 1,000 people to 500-a 50 per cent drop. We have heard about strategies, strategies and strategies-


Mr. Speaker:: Order. Would the hon. member please put his question.


William James Kempling: What I would like to know is, when are you going to exempt these industries at the GATT negotiations? Is a $2 billion market not large enough to protect?


John (Jack) Henry Horner: Mr. Speaker, the hon. member has listed a number of commodities and suggested that we have a deficit in their trading. I do not deny that, because his figures are more than likely correct. However, with regard to refrigeration in particular, I have toured the plants, and we have a tremendously automated refrigerating industry in Canada today.
We hope to work out a duty remission deal of some kind respecting the manufacture of refrigerators in Canada. That industry is eargerly looking forward to getting into the American market, because it has the capacity and can manufacture in competition with American manufacturers. In fact, just two weeks ago the plant I toured hired an additional 112 people and it now has a labour force of 700 men and women.


William James Kempling: Mr. Speaker, there is almost $1 billion alone in refrigeration equipment. Let me ask the hon. minister this: A report out of Geneva said that the industrial equipment and machinery business may go by the boards as a result of negotiations. Considering that we have a $3 billion deficit in industrial machinery and equipment-we imported $16 billion last year-is that market not large enough to protect, and what are you doing about it?


John (Jack) Henry Horner: Mr. Speaker, we on this side of the House believe that with greater liberalization of free trade, the whole of Canada will benefit. I would be interested in hearing about the protectionism of the Conservative party. If it is as protectionist as the hon. member says, it is a good thing I did leave it, because I was never that way.


Some hon. Members:: Oh, oh!


TRANSPORT
Mr. Heward Grafftey (Brome-Missisquoi):: Mr. Speaker, my question is to the hon. Minister of Transport. Because of safety considerations there has been a massive recall of certain Ford products in the United States over the last few days, ordered to be policed by the federal authorities in Washington. Can the minister inform the House of the situation in Canada because, obviously, a number of these makes-namely, Pintos
May 10, 1978

and Mercury Bobcats are on the Canadian market? What has the Canadian government done to make sure a similar recall has been effected in Canada, and what has it done to police this matter?


Hon. Otto E. Lang (Minister of Transport):: Mr. Speaker, our ordinary procedures are in play, which means that we are attempting on our own to determine the state of the evidence in relation to this particular vehicle. We have had contact with the makers as well as watching the situation very closely in the United States. The hon. member may know that the automobile manufacturers very frequently, and almost invariably, follow their actions in the United States with parallel action in Canada.


William Heward Grafftey: Mr. Speaker, because the proof was very conclusive in the United States that there was a major infraction of safety considerations relating to the Pinto and Mercury Bobcat, and there are thousands of these cars on Canadian roads, will the minister assure the House that his department will order their recall and make sure, as is done in the United States, that the recall is properly effected?


Otto Emil Lang: Mr. Speaker, I think the hon. member knows that the legal regime in Canada is slightly different from that in the United States; but I can assure the hon. member that within that limitation we will do everything we can.


AIRPORTS
Mr. Gus MacFarlane (Hamilton Mountain):: Mr. Speaker, my question is to the Minister of Transport. Early in the year he committed the government to the support and development of the airport at Hamilton. At this time, can he give the House any kind of time-frame as to what is occurring there, particularly with regard to runway 06 which seems to be in all the plans; and is anything being done that will prevent the costly diversion of Nordair aircraft to Toronto which seems to occur on a daily basis?


Otto Emil Lang: Mr. Speaker, I believe that runway, in fact, is one which has been identified as being a clear part of the development plan at Hamilton, and accordingly we will be moving forward immediately with improvements to the landing system. I can assure the hon. member that in Toronto not long ago, I stated that in my view the Mount Hope airport stands in a really good position to help with the overload that we see at different times at Malton. I will certainly try to see that my officials move forward as rapidly as possible with the Hamilton development plans and, indeed, encourage additional flights by regularly scheduled airlines through Hamilton.
Oral Questions NATIONAL SECURITY


GOVERNMENT'S KNOWLEDGE OF KCIA ACTIVITIES IN CANADA
Mr. Bill Jarvis (Perth-Wilmot):: Mr. Speaker, my question is to the Solicitor General. He will be aware of reports on the activities of foreign security service agents in Canada, namely, agents employed by the Korean Central Intelligence Agency, the alleged harassment of Vice-Consul Yang in Toronto, subsequent reports of harassment of Korean nationals resident in Canada and, indeed, Canadian citizens of Korean origin. Could the Solicitor General tell the House when he was first made aware of the activities of KCIA agents and what steps have been taken to terminate those activities?


Hon.   J.-J. Blais@Solicitor General: Mr. Speaker, with reference to the question of alleged harassment, I want to assure the House and the hon. gentleman that the allegations are under very close investigation by the security forces. In view of the fact that there is an investigation being carried on,
I am sure the hon. gentleman will understand my desire not to comment further.


William Herbert Jarvis: Mr. Speaker, I am becoming accustomed to the Solicitor General not commenting. When he indicates to the House that there is an investigation being carried on, does it relate in part to the three documents supplied to the law enforcement agency by Reverend Lee of the Korean community? In answering that question, could the minister indicate to the House whether the three or four KCIA agents who allegedly came to Canada did so under some diplomatic status?


Mr. Blais:: Mr. Speaker, I understand there were four alleged KCIA agents or officials who were supposed to come into Canada. I suggest there has not been any entry into Canada of any officials from South Korea. With reference to the alleged three documents to which the hon. gentleman refers, again, that would be subject to a comment that I am not ready to make.


NATIONAL DEFENCE
Mr. Allan B. McKinnon (Victoria):: Mr. Speaker, in a media event several months ago, the CBC showed what was purported to be a Canadian anti-terrorist squad in training. Can the minister now inform the House if such a squad has actually been formed and, if so, where are they and who are they?


Hon. Barney Danson (Minister of National Defence):: Mr. Speaker, no, I cannot.


Allan Bruce McKinnon: Mr. Speaker, my supplementary question is for the Minister of National Defence. If the formation of such unit has been authorized by the cabinet, who is to be the responsible minister: the Minister of Transport, the Solicitor
5274

May 10, 1978
Oral Questions
General, or the Minister of National Defence? If it has not yet been authorized, has he made application for it to be authorized?


Barnett Jerome Danson: Mr. Speaker, I cannot say.


RECRUITMENT OF ARMED FORCES PERSONNEL
Mr. W. C. Scott (Victoria-Haliburton):: Mr. Speaker, my question is for the Minister of National Defence. In light of the fact that numerous qualified young people, after passing the necessary tests to join the armed services, are told that there is little chance they will be accepted into the forces due to lengthy waiting lists, can the minister explain how he justifies a continuing aggressive advertising campaign designed to attract individuals to apparently non-existent positions in the service?


Barnett Jerome Danson: Mr. Speaker, it gives us an opportunity to be highly selective in the armed forces. We have highly skilled people and it is not that easy to get in. At the moment we probably have five times as many people who would like to get in as we have positions.


An hon. Member:: With a million unemployed it is not difficult.


Barnett Jerome Danson: That maintains the high standard of our armed forces and makes them among the best in the world.


RECRUITMENT OF PERSONS COMPLYING WITH COURT ORDERS
William C. Scott: Mr. Speaker, I have another question for the same minister. In the past, individuals on probation could sign up for the forces and thus come under the type of situation which assisted in their rehabilitation. Now, however, policy has changed and individuals are not accepted until proven free of court orders for six months. Will the minister consider reverting to the former system, so that probation officers will once again be assisted, rather than hindered, by the forces in their efforts at rehabilitation?


Barnett Jerome Danson: Mr. Speaker, as the hon. member is aware, there is a six months' waiting period after that. This is something that has been considered, and it is always under consideration. We wish to co-operate to the extent we can. As the hon. member indicates, there is a long waiting list to get into the armed forces. We have to balance these requirements and our requirements against the other needs of society, which we also serve.


TRANSPORT
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, my question is for the Minister of Transport. On March 7 the Minister of Transport gave the impression to the country that the government is providing a $16.3 million grant to expand the port of Prince Rupert in B.C. Recently, the Alberta Wheat Pool was informed by the National Harbours Board that the users, mainly the farmers in this case, will have to pay for the capital cost of that expansion.
I ask the minister whether he could clarify the government's position. Is it the government's intention to pay for the total cost of these facilities, namely, $16.3 million, or will the users have to pay for them?


Otto Emil Lang: Mr. Speaker, what was announced, and what is the fact, is that the government is making available $16 million for the development of the Ridley Island site initially for grain facilities and, indeed, for other purposes. No doubt a bulk handling coal facility will also be possible there. It is our ordinary practice to have charges against the product, and those who make use of these sites, through leases and the like. Obviously, that is designed initially to cover operating and maintenance costs. In addition to that, in certain cases, when it is appropriate, more than that. I think that will be part of our over-all approach to our ports throughout the country.


Lorne Edmund Nystrom: Mr. Speaker, I think that is a bit of a departure from the policy of the government at airports such as Mirabel. I ask the minister whether he can say categorically that the farmers of this country will not be held responsible for paying any of that $16.3 million? Or, indeed, through the minister's announcement in the House today, will the farmers be responsible for paying some of this capital cost?


Otto Emil Lang: Mr. Speaker, first of all, the hon. member is quite wrong in his reference to Mirabel, since that airport, as with other major airports, is now part of our airport revolving fund. Those costs are incorporated into the over-all costs of flying in the country, which I hoped the hon. member would endorse, rather than seeing them constantly put onto the backs of the taxpayers. I am really amazed that the hon. member is so negative about our action in moving forward with a major development. I hope he will applaud when the grain companies, hopefully, get together and put up the money to place a terminal in Prince Rupert.
Of course, a great portion of that is part of the ongoing costs and operations of marketing our grain. The hon. member need not be negative about that. This is a fantastic development of what could be a great port for the whole of the west. Let him not spread his negativism about to further dampen spirits in the west.


Some hon. Members:: Hear, hear!



May 10, 1978


OPERATIONS OF NORTHERN TRANSPORTATION CO. LTD.
Mr. Joe Clark (Leader of the Opposition):: Mr. Speaker, I have a question for the Minister of Transport. It relates to Northern Transportation Co. Ltd. which the minister will know has a mandate that is limited to serving as a common carrier in the Mackenzie watershed in the western Arctic. The minister will also know that that particular Crown corporation has gone beyond its mandate to acquire Grimshaw Trucking and Distributing Ltd. which is now underbidding private employee-owned trucking companies like Byers Trucking Co. in serving routes into Hinton, Grande Cache and Fort McMurray, Alberta.
Will the minister tell the House of Commons why a government-owned company is underbidding a private employee-owned company in a way that may result in the government company gaining a monopoly on certain trucking routes?


Otto Emil Lang: Mr. Speaker, I will be glad to look into the question and see whether this is an ordinary aspect of competition between the companies involved. Obviously, I would not want to see the fact that the parent corporation is government-owned lead it into encouraging loss operations in competition with private enterprise. I can give the hon. member great assurance about that. I am interested, though, in apparently indirectly encouraging, that we see to it that certain freight rates are higher than they otherwise would be.
I gather the hon. member has been reading the speeches of a couple of his colleagues who were worried about rail freight rates getting so low that they would compete with various truckers throughout the country. That is a delightful general statement but, as with the previous hon. member's question, if he has any examples let him specify where it is thought that their freight rates are so low as to be a danger.


Charles Joseph Clark: I ask the Minister of Transport whether it is the policy of the government to have Crown corporations establish subsidiaries that go beyond the original mandate of the Crown corporation, entering into activities which are wholly foreign to the original mandate, and under that new, expanded mandate to enter into competition with private sector companies. Is that the policy of the government?


Otto Emil Lang: Mr. Speaker, the policy of the government is to take careful consideration of any subsidiary operations by one of our Crown corporations. Put simply, the answer to the Leader of the Opposition's question would be no, it would not be the intention, ordinarily, to see them go into business that is completely unrelated to the original mandate.
However, one may want to look at that mandate to see whether there is a relationship which makes a particular acquisition desirable. I think I gave the Leader of the Opposition adequate assurance when I told him I did not want to see the fact that a Crown corporation exists lead to an operation being subsidized in competition with private enterprise. That is
Privilege-Mr. Crosbie
very important and it is a principle that 1 have adhered to constantly.


PRIVILEGE
Mr. Speaker:: There are outstanding two questions of privilege, one raised by the hon. member for Capilano (Mr. Huntington) and the other raised by the hon. member for Halifax (Mr. Stanfield). With regard to the one by the hon. member for Capilano, I can proceed with that tomorrow.
With regard to the point raised by the hon. member for Halifax, I wish to indicate to him and the House that I want a little further time to consider it. In fact the basic subject matter of the motion of the hon. member for Halifax, as I have indicated on a previous occasion, gives me no difficulty. I am in great sympathy with the concern that has been expressed that any suggestion that the offering for candidacy by any citizen of this country for membership in this House might result in even the slightest surveillance of any sort, be a matter of very high priority for the House. However, I am having difficulty in extending the concept of parliamentary privilege into the field of candidacy for election. It would be quite a considerable extension on the basis of precedent. I simply want to indicate that the matter is under careful and very intensive study and I would like a few more days to consider it.


MR. CROSBIE-PUBLIC SERVICE-INCORRECT STATEMENT ON LAY-OFF OF 60,000 PUBLIC SERVANTS
John Carnell Crosbie: Mr. Speaker, I rise on a matter of a breach of my privileges as a member of this House. It relates to a motion put to the House on Monday, May 8, page 5219, by the hon. member for Cape Breton-East Richmond (Mr. Hogan). I was not here at that time. I will try to be succinct. The relevant part of that motion is where the hon. member stated:
However, it is no funny matter for that member to say publicly that if his leader becomes prime minister of this country, 60,000 public servants will be laid off.
That is not a correct statement. It is an incorrect statement. It is part of a deliberate campaign by members of the NDP to allege across this country words that I have never said.


Some hon. Members:: Oh, oh!


John Carnell Crosbie: If I might continue, Mr. Speaker. I spoke in Thompson, Manitoba, on Friday, April 7. Not being a Liberal, I did not have a script. I spoke off the cuff for 40 minutes. That speech was reported in the Winnipeg Free Press of April 11, four days later. There was a small report. I need to refer to that to show how this canard got started. It is being used by the NDP outside this House, and now inside.
In that report in the Winnipeg Free Press it states that I said that a federal Progressive Conservative government would make, and I quote:
80038-44Vi

May 10, 1978
Privilege-Mr. Crosbie
-"Premier Sterling Lyon look like a pussycat" in cutting back on excessive civil servants,-
It adds that I told the federal PC meeting for Churchill that "Joe Clark's government would trim 60,000 civil servants by attrition". I never mentioned 60,000; I never mentioned 100; I never mentioned one civil servant being cut, in the speech.
I wrote the Winnipeg Free Press on April 19 telling them that their account was inaccurate, and telling them what I did say. What I did say was that the Conservative party would free the private sector from unnecessary regulation, restrain the growth of government expenditure, restrain the growth of government public servants and that we meant what we said, not like the Liberals, and that in that direction we would make Sterling Lyon look like a pussycat. Nothing was mentioned about laying off any civil servants.
On April 25 I sent a copy of that letter to the Leader of the NDP (Mr. Broadbent) because 1 knew he was going to prevaricate around the country with this statement. I already had a tipoff on that. Therefore I sent the Leader of the NDP a copy of my letter to the Free Press. It was published in the Winnipeg Free Press on April 26.
Next, the hon. member for Oshawa-Whitby, the Leader of the NDP, used it outside the House. Now the hon. member for Cape Breton-East Richmond changes even what I was supposed to have said by the Winnipeg Free Press, stating that I said that 60,000 public servants will be laid off. That is a libel on a member, in my opinion. As Mark Twain said, "A lie can travel half way around the world while the truth is putting on its shoes." While I am putting on my shoes, this lie is travelling around the world.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: As the election approaches, the New Democratic Party becomes the "nasty, devious, prevaricating" party. The hon. member suffers from "pseudomnesia". He has a memory for things that never happen. I call on him now to retract his inaccurate statement, play the game fairly, and stop trying to put this lie half way around the world while I am putting on my shoes.


Some hon. Members:: Hear, hear!


Mr. Andy Hogan (Cape Breton-East Richmond):: Mr. Speaker, I think the libel has been perpetrated in this House this afternoon by the hon. member for St. John's West (Mr. Crosbie) against me. I am quoting from the Ottawa Journal, which I was told was a notorious PC paper, although the hon. member for Ottawa-Carleton (Mrs. Pigott) told me before the House today that that is no longer true. I want to quote from that article of May 6, 1978, datelined Manitoba, by Mr. Cleverley, a correspondent. This is what got me upset. I quote:
The present Conservative member of the federal parliament for Churchill, Cecil Smith, was visibly uncomfortable during his own nomination meeting when John Crosbie of Newfoundland promised that the next federal Conservative government would make Sterling Lyon "took like a pussycat" in reducing the size of the civil service. Crosbie said Joe Clark would cut 60,000 federal jobs.

There are two different reports. I am a relatively new member in this House, as is the hon. member for St. John's West. I am sorry if I did not know the Journal is a Tory paper. I quoted Mr. Cleverley on this point.
The hon. member says he did not say it, and he says he has nothing in writing. I was told by their members to see what he had in writing, but he was not here yesterday, so I raised the matter largely because I did not think we should be talking like this when there are one million unemployed in this country. People from the Atlantic region should be talking about decentralizing the bureaucracy, not cutting people off from it.


Mr. Speaker:: Order, please. The basic point still remains that the hon. member for St. John's West (Mr. Crosbie) has indicated that he is clearly referred to in the motion by the hon. member for Cape Breton-East Richmond (Mr. Hogan) as having used a specific figure of 60,000.
I took it from the latter sentences of the hon. member for Cape Breton-East Richmond that he was indicating to the House that, if he had said that on the basis of mistaken information, he was apologizing to the House for that. At least I understood that was the sense of that remark. If I have not that confirmed, I would certainly want to insist.
There may be a dispute as to facts generally involved here. However, if the hon. member for St. John's West says that he did not use the specific figure of 60,000, and that figure is contained in the motion of the hon. member for Cape Breton-East Richmond, I would think it appropriate that the hon. member for Cape Breton-East Richmond indicate to the House now that he either stands by that figure and that statement, or that he withdraws it.


Andrew Hogan: I never said the hon. member said it. I quoted from the newspaper, the Journal.


Some hon. Members:: Oh!


Mr. Speaker:: Order, please. I have in my hand the text of the hon. member's motion and it does not make any reference to any quotations or any other source of information. The text reads:
All members of this House have learned to appreciate the humour of the hon. member for St. John's West (Mr. Crosbie). However, it is no funny matter for that member to say publicly that if his leader becomes prime minister of this country, 60,000 public servants will be laid off.
That seems a very direct allegation to me, and if the hon. member does not have any information upon which it is based it appears to me he should withdraw it.


Andrew Hogan: As a member of this House I take the hon. member's word. But I was quoting the Journal, not the hon. member.


Some hon. Members:: Withdraw!


Mr. Speaker:: Order. I have formally asked the hon. member for Cape Breton-East Richmond to withdraw that allegation.
May 10, 1978


Andrew Hogan: I will withdraw it in the light of what the hon. member for St. John's West has said today, but I should like to see the evidence presented to me directly because, although I did not say it in the motion, I was quoting a Journal article. Very well, I withdraw.



ROUTINE PROCEEDINGS


Hon. Daniel J. MacDonald (Minister of Veterans Affairs):: Mr. Speaker, it is a pleasure to inform the House that it is the intention of the government to introduce legislation to increase the basic rate of pensions for disabled veterans by $310.76 annually to $7,471.


Some hon. Members:: Hear, hear!


Daniel Joseph MacDonald: The proposed increase is in addition to the automatic increase provided under the Pension Act each January in accordance with the consumer price index.
This increase is significant at a time when, as all Canadians recognize, government expenditures must be restrained, and it demonstrates the government's determination to honour a long-standing commitment to ensure an adequate income to disabled veterans and their dependents in recognition of the service they have rendered to their country. The enabling legislation will be introduced as soon as possible to make the increase effective July 1, and will provide for proportionate increases with respect to lesser disabilities and related pensions. Similar appropriate increases will be provided to those who qualify for prisoner of war compensation.
I am sure all hon. members will co-operate to ensure that this legislation receives quick passage.


Walter David Baker: Mr. Speaker, on behalf of the official opposition I want to say we welcome this announcement. I am sure the House will understand if, in the course of my short statement, I pay tribute to the former member for Humber-St. George's-St. Barbe who, along with other members-and I have no hesitation about mentioning particularly the hon. member for Winnipeg North Centre (Mr. Knowles)-worked hard to obtain this benefit for our veterans.
I regret that this announcement should have come so late in the session, especially when there is some question as to how long the session will last.


An hon. Member:: Lots of time yet.


Walter David Baker: But whatever the situation might be, I want to say on behalf of my party that we shall be
Veterans Affairs
prepared to discuss ways in which the legislation flowing from this statement could be expedited. The proposals announced by the minister go a significant distance in honouring the obligation which all of us have, and will have for our lifetime, to those who served in the wars in which our country has been engaged and who were disabled as a result of that service. We owe them, as a nation, a great obligation. It is in that spirit my colleagues and I welcome the statement made today. I assure the minister that if he would confer with his colleague, the government House leader, with respect to the expedition of this legislation we would be most pleased to co-operate.


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, as one who has raised this matter scores-perhaps hundreds-of times during the last two or three years, I congratulate the Minister of Veterans Affairs (Mr. MacDonald) on his success in getting the cabinet to approve the announcement he has made today. I am happy to join with the hon. member for Grenville-Carleton (Mr. Baker) in making reference to my good friend, Jack Marshall. As has been said, he and I have been working very hard for this. The only thing one can really say today is that we welcome the announcement most warmly.
I suggested the other day, in a motion under Standing Order 43, that a bill of this kind could be put through the House in all its stages in one day. I now believe, in the light of the statement just made by the House leader for the Progressive Conservatives, that we could do it in about half an hour.


Walter David Baker: Hear, hear!


Stanley Howard Knowles: I hope the government will make arrangements to bring in the necessary bill right away so that it can be put into effect and not get lost in any shuffle which could take place.
I must say I am sorry this proposed increase is to be simply on an ad hoc basis. As I understand it, the raising of the basic rate to the average level of the five designated levels in the Public Service is for the current year only, leaving increases in future years to be determined by the rise in the consumer price index. I hope that some day there will be built into the act itself an automatic provision which will keep the level of the 100 per cent disability pension in line with the level of the five categories in the Public Service. But for the moment we have corrected a wrong which veterans have suffered for a few years, and I am glad to indicate our full support.
Now that the minister has won this battle I hope he will work just as hard to get a correction in the rule regarding widows of veterans. Some day, and some day soon, we must alter the provision which deprives widows of any pension at all if the veteran's disability pension was below 48 per cent. We welcome the announcement and give the minister the assurance that, if he will bring in legislation, we will pass it quickly. I believe my estimate of half an hour is probably correct.

May 10, 1978
Criminal Code


Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, first of all I must inform the minister that I did not receive a copy of the statement he has just made, but I listened carefully. It sometimes happens that we do not receive the French copy, but this time I received neither the French nor the English copy, but I do not hold it against him. He is a very decent fellow; only yesterday I was speaking with him and I congratulated him on the excellent measures he introduced and which have been passed by parliament since he has been minister.
I am satisfied that the legislation he has just outlined will be tabled before the House and will contain all the provisions mentioned in his statement. In extending my gratitude to the minister, I am certain that I am speaking on behalf of all veterans and all those who were waiting impatiently for even more improvements in that sector. As the leader of the New Democratic Party said, we hope that the legislation will be introduced shortly and that we may pass it so that those who stand to benefit from it will be able to do so as soon as possible.


Daniel Joseph MacDonald: Mr. Speaker, I would like to
apologize to the hon. member in the Social Credit party. 1 understood that the statement was sent to all parties.


Walter David Baker: Mr. Speaker, I would like to ask the minister whether the legislation is in fact drafted and whether there has been consultation between the government House leader and the minister. If so, can the minister tell us when he plans to introduce the legislation, bearing in mind the assurance which has been given by all opposition House leaders today?


Daniel Joseph MacDonald: Mr. Speaker, the legislation is not drafted. We went as far as we could go without finalizing it. I am not worried about discussions with the government House leader. I am not worried about whether the legislation will be forthcoming. I think it will be coming in quite soon.


CRIMINAL CODE
Mr. Dean Whiteway (Selkirk) moved: for leave to introduce Bill C-454, to amend the Criminal Code (death sentence).


Some hon. Members:: Explain.


Dean Waldon Whiteway: Mr. Speaker, this amendment would, in effect, reinstate capital punishment for all capital crime, excluding that of high treason.


[Stage Direction]
Motion agreed to, bill read the first time and ordered to be printed.
Mr. Speaker:: As I have indicated in the past with respect to the subject matter of bills, the House should understand that I choose a seconder to afford an hon. member the right to introduce a bill, and that seconder is not necessarily associated with the subject matter of the bill itself.


PETITIONS
Arthur Jacob (Jake) Epp: Mr. Speaker, I rise this afternoon to present a petition. As the House is well aware, the last year has seen much progress made in an attempt to define pornography and obscenity in Canada. A bill has been introduced by the Minister of Justice (Mr. Basford). The bill is in conformity with the report made by the Standing Committee on Justice and Legal Affairs. The public outcry has been-


Mr. Speaker:: Order. If the hon. member has a petition, he should simply explain its contents.


Arthur Jacob (Jake) Epp: Thank you, Mr. Speaker. The petition I have with me today calls on the government to re-define obscenity and encourages the government to move forward with the bill it has introduced.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Yvon Pinard (Parliamentary Secretary to President of Privy Council):: Mr. Speaker, the following questions will be answered today: 464, 937, 1,120, 1,232, 1,329, 1,385, 1,393, 1,414, 1,415, 1,422, 1,430, 1,451, 1,470, 1,501, 1,508 and 1,534.
Mr. Speaker, I ask that the remaining questions be allowed to stand.


Mr. Leggatt: In each fiscal year since 1970, what amount was spent in the Constituency of New Westminster by the Department of Justice and those agencies that report to it?


Mr. Roger Young (Parliamentary Secretary to Minister of Justice):: In so far as the Department of Justice is concerned:
May 10, 1978

Fiscal Years	Amounts
1970/71	$ 2,171.95
1971/72	1,937.10
1972/73	Nil
1973/74	276.00
1974/75	12,383.05
1975/76	59,868.18
1976/77	52,739.69
April 1, to November 7/77	113,416.05
In so far as the Law Reform Commission, the Tax Review Board, the Canadian Human Rights Commission are concerned: Nil.


Mr. McKenzie: 1.	Is the UIC initial claims data form still in use and, if so, what methods are taken to test if a claimant's card is authentic?
2.	Did Mr. Guy Cousineau, former Chairman of the UIC or the Honourable Robert Andras, former Minister of Manpower and Immigration direct persons to destroy Special Investigation Division documents into criminal fraudulent activities in 1975?
3.	Did Mr. Raymond Dupont, Parliamentary Secretary to the Minister of Employment and Immigration state in the House on December 5, 1977, that 60,000 fines were imposed and, if so (a) what is a breakdown of the regions, by numbers, when such fines were levied (b) how many were due to the fraudulent use of social insurance cards (c) how many of the individuals charged had more than one SIN number (d) how many of the individuals charged had inside assistance?


Hon. Bud Cullen (Minister of Employment and Immigration):: 1. Yes, the initial claims data form is still in use. The computer verifies all claimant's cards and will reject, for investigation, any card that it cannot authenticate.
2.	No.
3.	He stated that an estimated 60,000 fines were imposed, (a) The estimated breakdown of these administrative penalties is: Atlantic, 10,000; Quebec, 20,000; Ontario, 20,000; Prairies, 5,000; Pacific, 5,000. (b) Statistics of this nature are not available, (c) Statistics of this nature are not available, (d) Of the people prosecuted by the commission, seven had inside assistance.


Mr. Rodriguez: For each fiscal year since 1970, what amount was spent in the Constituency of Nickel Belt by the Department of Communications and those agencies that report to it?


Mr. C. Douglas (Parliamentary Secretary to Minister of Communications):: In so far as the Department of Communications is concerned: none. In so far as CRTC is concerned: none.


Mr. McKinnon: 1.	Did the government approve a proposal by Canadair Ltd. to raise $70 million (US) in five year promissory notes in international capital markets for use in the CL-600 Challenger Programme and, if so, in what manner is the financing to be arranged and what is its purpose?
Order Paper Questions
2.	Is money for the Challenger Programme still being supplied by Canadian banks and (a) if so, by which banks and in what amounts (b) if not, for what reason?
3.	What are all the conditions to which the government has agreed with respect to the financing?
4.	Will the financing agreement have any effect whatsoever on the government's declared intention eventually to return Canadair to the private sector and, if so, in what way?
5.	Has a foreign partner been found to participate in the Challenger Programme and (a) if so, what is that partner's name and what is the extent of its participation (b) if not, is a foreign partner being sought?
6.	Has Canadair repaid the $6 million loan plus accrued interest it received from the Defence Production Revolving Fund in 1972 and (a) if so, what was the total amount and on what date was repayment made (b) if not, what is the total amount due and on what date will repayment be made?
7.	What is the total amount of the government's involvement in Canadair, including (a) original purchase price (b) additional investment (c) loans (d) guarantees for loans raised in (i) international (ii) domestic markets?


John (Jack) Henry Horner: 1. (a) The government has approved a proposal by Canadair Limited to raise $70 million US in five year promissory notes in international capital markets, (b) The notes will be placed by an underwriters group led by the Merrill Lynch group, (c) To remove the need for direct government guarantees to the Canadair bankers against a line of credit of up to $70 million established for the Canadair Challenger program.
2.	(a) At present the financing of the Canadair Challenger program is provided by a credit line of $120 million in the form of demand loans with two Canadian banks. 80 per cent of the funds would come from the Canadian Imperial Bank of Commerce and 20 per cent from the Provincial Bank of Canada, (b) Not applicable.
3.	The associated undertakings and acknowledgements of the government are as follows: (i) So long as any of the notes remain outstanding, Her Majesty will not sell, nor transfer ownership of, nor dispose, nor alter, nor assign, nor encumber any shares of Canadair if the effect thereof: (a) is to reduce the voting rights of Her Majesty associated with the shares of Canadair to less than 66% per cent, (b) does not permit Her Majesty to continue to elect all of the members of the board of directors of Canadair. Unless prior thereto Her Majesty shall have fully and unconditionally guaranteed the payment of all amounts then due and to become due in respect of the notes, (ii) The government confirms its dedication to seeing Canadair operated in a manner consistent with the honouring of all its obligations to creditors, including the notes, (iii) The Minister of Industry, Trade and Commerce confirms that it would be his intention to seek authority from parliament, if necessary, for appropriate financial measures to enable Canadair to meet unforeseen expenditures resulting from cost overruns which might occur in the CL600 development and production program. (iv) The minister recognizes Canadair's covenant that so long as any of the notes are outstanding Canadair will not reduce the amount of its share capital nor will it pay dividends on any of its shares nor will issue any additional shares except to Her Majesty.

May 10, 1978
Order Paper Questions
4.	The undertakings place a time constraint on the full return of the company to the private sector so long as the notes remain outstanding unless prior thereto Her Majesty shall have fully and unconditionally guaranteed the payment of all amounts then due and to become due in respect of the notes.
5.	Participation has not been arranged with a foreign partner in the Challenger program. The desirability of such an arrangement declined as the program progressed, (a) Not applicable, (b) No.
6.	Yes. (a) The principal sum of $6 million plus accrued interest of $2,599, 853.35 was paid to the Defence Production Revolving Fund on March 31, 1977. (b) Not applicable.
7.	(a) Original purchase of Canadair, $38,150,000; (b) Additional investment as at December 31, 1976, $8,468,715; (c) Refundable inventory financing, during period since Crown took ownership of Canadair resulting from agreements standing at the time of purchase, $16,006,996; (d) (i) Nil. (ii) The Government of Canada is currently guaranteeing a line of bank credit to Canadair up to $70 million in connection with the financing of the Challenger program.


Mr. Mazankowski: 1.	Does Air Canada have a policy on free travel passes and, if so (a) what is it (b) to whom does it apply (c) is it presently under review?
2.	How many such passes are issued each year and on what basis?
3.	What is the average annual cost to Air Canada for such passes?
4.	Does Air Canada obtain any kind of approval from the Canadian Transport Commission regarding free travel passes and, if so (a) what is the rationale for this approval (b) what effect does the dispensing of the passes have on applications made by Air Canada to the Canadian Transport Commission to increase the rate of air fares?
5.	Did Air Canada obtain a ruling from the Department of National Revenue with respect to the application of complimentary passes under the conditions of the Income Tax Act?


Otto Emil Lang: The management of Air Canada advises as follows: 1. (a) and (b) Air Canada's pass policy applies to its 20,000 employees and their qualified dependents who are eligible for limited personal passes which are subject to the availability of open seats at flight time. Passes are also issued to employees as required for company business travel, and to non-company persons such as cabinet ministers, Transport Canada officials with aviation responsibility, officials of Canada Post Office, of other airlines, and to certain CN employees performing functions for Air Canada. A certain number of individual trip passes are also issued for commercial promotional purposes, (c) Like all the airline's policies, it is under constant review.
2.	The issuance of free and reduced rate transportation by all Canadian airlines is governed by the Air Transport Committee of the Canadian Transport Commission under the Aeronautics Act. Air Canada's practice in the application of these passes is similar to other Canadian carriers and the airline regards details of its promotional pass issuance as proprietary.

3.	Employee personal passes are contingent upon the availability of open seats and a service charge is levied; blackout periods during heavy travel peaks apply to promotional passes with the result that these passes are also normally used when there are open seats available and the cost is minimal.
4.	(a) See No. 2. (b) Pass issuances have no effect. Rate increase applications to the Canadian Transport Commission are accompanied by a comprehensive economic justification of costs for the airline to operate its approved schedule at a load factor reflecting the convenience of scheduled service. This load factor for the airline as a whole averages in the mid 60 per cent range which means there are generally unused seats available for pass travel.
5.	No.


Mr. Dionne (Kamouraska): During (a) 1975 (b) 1976 (c) 1977, did any Canadians work in the forest industry in the United States, particularly in the States of Maine and New Hampshire and, if so, how many?


Jack Sydney George (Bud) Cullen: The commission does not maintain any record of Canadians working outside the country.


Mr. Dionne (Kamouraska): From 1965 to 1977, what amount did the government spend annually to administer the Unemployment Insurance Act for (a) salaries of (i) employees of different categories (ii) members of the Appeal Board (b) the upkeep of buildings?


Jack Sydney George (Bud) Cullen: (a)(i) As the financial system is not designed to identify salaries by categories, the information cannot be provided, (ii) The information is not available prior to 1975. 1975, $1,207,748; 1976, $1,471,562; 1977, $1,490,227. (b) As the financial system does not identify the upkeep of buildings separately, the information cannot be provided.


Mr. Knowles (Winnipeg North Centre): 1.	How many retired employees of the Canadian National Railways are in receipt of pensions of less than $25.00 per month?
2.	How many are in receipt of a pension of $25.00 per month?
3.	How many are in receipt of pensions of (a) $25.01 to $29.99 per month (b) $30.00 to $39.99 per month (c) $40.00 to $49.99 per month (d) $50.00 to $59.99 per month (e) $60.00 to $69.99 per month (f) $70.00 to $79.99 per month (g) $80.00 to $89.99 per month (h) $90.00 to $99.99 per month (i) $100.00 to $124.99 per month (j) $125.00 to $149.99 per month (k) $150.00 to $199.99 per month (1) $200.00 to $299.99 per month (m) $300.00 to $399.99 per month (n) $400.00 to $499.99 per month (o) $500.00 to $599.99 per month (p) $600.00 to $699.99 per month (q) $700.00 to $799.99 per month (r) $800.00 per month and over?
May 10, 1978


Otto Emil Lang: The Management of Canadian National Railways advises as follows: 1. One hundred eighty three.
2.	Five hundred thirty five.
3.	(a) 181; (b) 144; (c) 454; (d) 378; (e) 433; (0 372; (g) 1,011; (h) 454; (i) 1,015; 0) U06; (k) 2,628; (1) 5,991; (m) 4,566; (n) 2,964; (o) 2,071; (p) 1,348; (q) 898; (r) 1,606. In a number of cases, the amount of pensions paid by Canadian National Railways do not represent the total pensions payable to employees for railway service. Pensions payable by CNR to international employees (service in both Canada and the United States) relate to their service in Canada only. Such employees also receive annuities respecting eligibility for which CN has made contributions payable under the U.S. railroad retirement act or the social security act for service performed in the United States. For example, in the group receiving pensions under $25 a month, in 1977 there are 30 former international employees who receive U.S. railroad retirement or social security annuities in respect of CN service rendered in the United States. In addition, there are various pension agreements between CN and other companies, such as Canadian Pacific Limited, CP Telecommunications and the Ontario Northland Railway, where each company issued separate cheques for its portion of the total pension. Only the pension payable by CN is in this statement Also, since the passing of the Pension Benefits Standards Act by the federal government on October 1, 1967, there are 60 employees who have terminated service with CN and are receiving rather small compulsory deferred pensions for service performed only from October 1, 1967. The balance of those receiving small pensions are employees who elected early retirement (before age 65) with reduced basic pensions ($25) and employees who had very short service and very small contributions.


Mr. Knowles (Winnipeg North Centre): 1.	What was the total amount on the books of the pension funds of the Canadian National Railways as at December 31 (a) 1975 (b) 1976 (c) 1977?
2.	What rate of interest was earned on such funds during (a) 1975 (b) 1976 (c) 1977?
3.	What amount of interest was credited to the funds during the year ending December 31 (a) 1975 (b) 1976 (c) 1977?
4.	What amount was added to the funds from employee contributions during the year ending December 31 (a) 1975 (b) 1976 (c) 1977?
5.	What amount was added to the funds as regular or current contributions by the Canadian National Railways during the year ending December 31 (a) 1975 (b) 1976 (c) 1977?
6.	What amount was added to the funds in any other way by the Canadian National Railways during the year ending December 31 (a) 1975 (b) 1976 (c) 1977?
7.	Is money owed to the above funds by the Canadian National Railways and, if so, how much and what arrangements are being made to meet such debt?
8.	What was the total amount paid of the above funds in pensions during the year ending December 31 (a) 1975 (b) 1976 (c) 1977?


Otto Emil Lang: The management of Canadian National Railways advises as follows: 1. As
Order Paper Questions
at December 31, 1975, $1,295,992,657; As at December 31,
1976,	1,461,873,667; As at December 31, 1977, 1,615,469,748.
2.	To calculate the yield we have used the Statistics Canada formula, under which the investment is deemed to be opening investments plus closing investments, less earnings, divided by two: On this basis, the yield is: 1975, 5.95 per cent; 1976, 6.33 per cent; 1977, 6.75 per cent.
3.	Year ended December 31, 1975, $69,727,964; Year ended December 31, 1976, 83,377,841; Year ended December 31,
1977,	99,146,414.
4.	Year ended December 31, 1975, $51,609,714; Year ended December 31, 1976, 50,057,197; Year ended December 31, 1977, 55,857,289.
5.	Year ended December 31, 1975, $94,746,365; Year ended December 31, 1976, 116,673,842; Year ended December 31, 1977, 122,454,430.
6.	Year ended December 31, 1975, $14,766,374; Year ended December 31, 1976, 25,080,781; Year ended December 31, 1977, 1,131,400.
7.	At December 31, 1977, Canadian National Railways owed $6,198,839 representing December items. This amount was paid in January, 1978.
8.	Year ended December 31, 1975, $93,567,159; Year ended December 31, 1976, 109,308,650; Year ended December 31, 1977, 125,003,230.


Mr. Broadbent: 1.	For the years 1970 to 1977, what was the annual number of passenger movements through Dorval Airport?
2.	For the year 1977 (a) what was the number of passenger movements through Mirabel Airport (b) how many of these passenger movements involved a transfer to or from Dorval Airport?
3.	For the years 1970 to 1977, what was the annual number of passenger movements through the Toronto International Airport (Malton)?
4.	For the years 1970 to 1977, using the 1973 population distribution datum that is referred to in the Airport Inquiry Commission (AIC), what is the number of persons annually exposed to a noise level of 28 NEF or larger?


Otto Emil Lang: 1. Lists below present arriving/departing passenger data for Dorval Airport for the years 1970 to 1976 (see also 2(a)).
2.	(a) Annual 1977 figures are not yet available and therefore nine months of preliminary data on passenger traffic at Dorval, Mirabel and Toronto International Airports have been provided in lists below, (b) Formal statistics are not kept on the number of passengers connecting between Mirabel and Dorval. Estimates based on passenger surveys and other sources range from 70,000 to 120,000 for the year 1976.
3.	Lists below present arriving/departing passenger data for Toronto International Airport for the years 1970 to 1976 (see also 2(a)).
4.	With respect to the final question regarding noise exposure, these data are presently being produced for the years

May 10, 1978
Order Paper Questions
required. This information will be supplied as soon as it is available.
Passengers Travelling on Scheduled and International Air Charter Services at Dorval, 1970-76
Revenue Passengers
Year	Arriving	Departing1970	2,661,982	2,640,7371971	2,888,734	2,897,5861972	3,349,163	3,322,2441973	3,898,443	3,893,3701974	4,243,086	4,262,9831975	4,009,426	3,993,8021976	2,715,498	2,743,219
Passengers Travelling on Scheduled and International Air Charter Services at Toronto International Airport, 1970-76
Revenue Passengers
Year	Arriving	Departing1970	3,256,784	3,198,2191971	3,651,854	3,597,7001972	4,167,247	4,078,4401973	4,956,211	4,915,8231974	5.605,819	5,532,1781975	5,610,793	5,529,2821976	5,732,570	5,663,739Passengers Travelling on	Scheduled andInternational Air Charter Services-	January-September 1977 (Preliminary)	Revenue Passengers	1977	Arriving	DepartingDorval	2,120,900	2,109,900Mirabel	1,039,700	1,002,000Toronto	4,597,200	4,530,600
determined. In any event relocations would be placed gradually over a period of several years in order to minimize inconvenience to employees and impact on communities involved.
2,	3, and 4. A study of the functions to be transferred from Toronto areas has not yet been sufficiently advanced to enable the determination of the precise numbers of persons who will be affected or to indicate what assistance should be provided; this information will be determined following analysis of all aspects of the relocation and will have an influence on the decisions to be reached.


Mr. McKinnon: As of November 1, 1977, December 1, 1977, January 1, 1978 and February 1, 1978, what amounts have been received as deposits for orders of the "Challenger" business jet to be produced by Canadair?


Mr. Bernard Loiselle (Parliamentary Secretary to Minister of Industry, Trade and Commerce):: Value of deposits held on Challenger aircraft orders at Canadair Limited are reported as follows: November 1, $20.9M; December 1, 22.4; January 1, 24.3; February 1, 24.6.


Mr. Allard: 1.	Since the implementation of the Opportunities for Youth Programme, did the government allocate money to the Constituency of Rimouski and, if so, in what amount?
2.	For each project accepted, what was the (a) name of the project (b) amount allocated (c) year of acceptance (d) name of the municipality involved (e) number of jobs created?


Jack Sydney George (Bud) Cullen: 1. and 2. The Opportunities for Youth Program did not operate on a constituency basis and as a result the data is not available by constituency.


Mr. McGrath: 1.	Did CNT make a decision to move its personnel from St. John's to Gander and, if so (a) for what reason (b) how many persons will be affected?
2.	What is the total number of persons to be moved from Toronto to Gander by CNT?
3.	What provision is CNT prepared to make for long-term employees who, for family reasons, do not wish to make the move?
4.	Is CNT prepared to pay a special allowance to persons who are unable to move their families to Gander?


Otto Emil Lang: The Management of Canadian National Railways advises as follows: 1. Relocation of the headquarters for CNT's operations in Newfoundland from St. John's to Gander has been approved in principle. No detailed implementation plan has yet been formally ratified but the matter is under active study, (a) Telephone operations is the major sector of CNT's business in Newfoundland and Gander is the centre of such services, (b) The number of persons who may be affected is not yet


Mr. Patterson: 1.	What amount was spent by the government in the Constituency of Fraser Valley East under the Opportunities for Youth Programme in each year of its duration?
2.	What amount was spent by the government in the Constituency of Fraser Valley East under the Local Employment Assistance Programme (LEAP) in each year since its inception?


Jack Sydney George (Bud) Cullen: 1. The Opportunities for Youth Program did not operate on a constituency basis and, as a result, data is not available by constituency.
2. $66,444 in 1973-74.


Mr. Huntington: 1. Has the government been involved in a research study investigating drinking and driving carried out by the Cranfield Institute of Technology in
May 10, 1978

Beds, England and, if so (a) for how long (b) what has been the total contribution by Canada to date, in terms of dollars (c) how many Canadians are involved in the study and how many man-years does this represent (d) for what period of time does the government plan to remain involved in the study (e) what does the government hope to gain from its involvement in the study?
2.	Will a report or summary of findings be published and, if so, will they be utilized by proper agencies in Canada and will they be available to the public?
3.	For what reason is this type of research being carried out in England and not in Canada, thus utilizing Canadians in the study?


Otto Emil Lang: 1. Yes. (a) Since October 1, 1977. (b) Approximately $11,000 has been paid to date on a contract with a total value of $20,000. (c) One Canadian is involved in the study and his time represents almost nine man-months, (d) The contract with the Cranfield Institute of Technology is to be completed on August 1, 1978 with the submission of a final report on the project, (e) An evaluation of the feasibility of using simple on-highway driving tests to identify drivers whose ability is impaired by alcohol, thereby to increase the efficiency of conventional enforcement practices.
2.	A full report of the study will be published and the results will be communicated to responsible federal and provincial agencies. The results are expected to be used principally by law enforcement agencies.
3.	A combination of factors, specifically the availability in one location of: (i) an instrumented vehicle and the necessary technical support functions (ii) an extensive, paved, off-highway test area with controlled access; (iii) maximum available test time provided by a temperate climate and long nights; and (iv) a co-investigator with expertise in relevant research areas.


Mr. Schumacher: 1.	How much tax money was declared owing to the government by the Hutterite colonies as a result of the recent court decisions and what arrangements were made by the government to collect?
2.	Has the recent counter action by the Hutterian Brethern stopped the government collecting the taxes declared owing in the original judgements by the Supreme Court of Canada and the Federal Courts?
3.	Has the government made provisions to ensure that, in the future, taxes will be properly (a) levied (b) collected in each case involving Hutterian Brethern?


Mr. Yves Demers (Parliamentary Secretary to Minister of National Revenue):: 1. The appeals submitted by the Hutterite colonies have not yet been heard by the Tax Review Board or the courts.
2.	No. Revenue Canada has proceeded to fully secure the outstanding accounts by registering encumbrances against land owned by the colonies who have appealed the assessments.
3.	(a) Revisions to section 143 of the Income Tax Act, explained in Revenue Canada's Information Circular 78-5, have clarified the determination of taxable income for communal organizations, (b) Collection of taxes from these organizations is no different than from all other taxpayers.
Ways and Means


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


Some hon. Members:: Agreed.


Yvon Pinard: Mr. Speaker, I ask that all notices of motions for the production of papers be allowed to stand.


Mr. Speaker:: Shall the notices of motions for production of documents be allowed to stand?


Some hon. Members:: Agreed.


BUSINESS OF THE HOUSE
Joseph Jacques Jean Chrétien: Mr. Speaker, I understand that there would be agreement at this time to concur in the notice of ways and means tabled on April 10, 1978, relating to income tax.


Walter David Baker: Mr. Speaker, there have been some discussions with respect to that. We are now agreeable.


Stanley Howard Knowles: That is correct. We agree.


Mr. Speaker:: The consent of the House is required for the disposition of this matter at this time. I understand that the House does consent to the disposition of the ways and means motion standing in the name of the Minister of Finance (Mr. Chretien).


Some hon. Members:: Agreed.


WAYS AND MEANS
[Stage Direction]
CONCURRENCE IN MOTION TO AMEND THE INCOME TAX ACT Hon. Jean Chretien (Minister of Finance) moved:
That a ways and means motion to amend the Income Tax Act, laid upon the table, Monday, April 10, 1978, be concurred in.
Mr. Speaker:: Is it the pleasure of the House to adopt the said motion?


[Stage Direction]
Motion agreed to.
[Stage Direction]
May 10, 1978
Railway Act


[Stage Direction]
The House resumed, from Monday, May 8, consideration of the motion of Mr. Abbott (for Mr. Lang) that Bill C-17, to amend the Canadian National Railways Capital Revision Act and the Railway Act and to amend and repeal certain other statutes in consequence thereof, be read the third time and do pass, and of the amendment (Mr. Murta) (p. 5176).
Mr. Peter P. Masniuk (Portage):: Mr. Speaker, I rise today to participate again in the debate on Bill C-17, the CNR refinancing bill, as it is known. I also want to support the amendment moved by my colleague, the hon. member for Lisgar (Mr. Murta). I spoke during second reading debate for the purpose of making known some of my views on this CNR refinancing and also on the Hall commission and on railway abandonment in my home province of Manitoba. A little later I would like to add to some of those earlier remarks.
As hon. members know, our party intends to vote against this bill. Our reasons for not supporting Bill C-17 have been put on the record by other members of the Progressive Conservative party. We do not feel that this bill serves any real purpose. The government has tried to make it appear as if the passage of this bill will save Canadian taxpayers money, but a close examination shows that this is merely an illusion, a stage trick.
The CNR's own profit projections for the next five years show that the capital restructuring provided in this bill is not necessary for the corporation to make a profit. The first quarter of this year has produced a healthy profit for the railway, and its own projections show that this is going to be the case for the next few years whether this bill is passed or not. With this bill the profits will be only that much greater.
CN is a Crown corporation, and therefore its shareholders are the citizens of Canada. Under our democratic parliamentary system we are the peoples' representatives, and therefore CN is accountable first and foremost to parliament and not to the capital market. The problem, however, is how to make CN accountable to parliament.
As hon. members are aware, there is at present another royal commission in existence apart from the McDonald commission which is getting so much publicity, namely, the commission on corporate concentration, which will shortly hand down its recommendations on the basis of which the government has promised to prepare its legislation governing Crown corporations. We think that the bill before us should be deferred until that time.
The last time that CNR came before parliament asking to be relieved of its debts was in 1952 when the railway began a huge program of capital expenditures, and less than a decade

later, in 1961, generated a debt of slightly under $1 billion. But despite all the expenditures, CN transportation service began to decline after that. The CN became involved in many other ventures, but CN railway transport has not improved at all in the 26 years since 1952.
We in the Conservative party believe that now is not the time to give passage to Bill C-17. There are just too many questions hanging over the future of rail service in this country. The government has committed itself to a large expenditure in order to upgrade the grain handling lines in western Canada. There may be an adjustment of the Crow rates- something which I personally fear-but that is uncertain, and I am not reassured by the odd noises from the Minister of Transport (Mr. Lang) to the effect that there will be no tampering with the Crow rates. However, that is another subject.
Also, CN has been relieved of what is perhaps its biggest burden, that is, the rail passenger service, with the formation of VIA Rail, but no one really knows yet whether VIA Rail will prove to be a wise decision or a big mistake. Personally I support VIA Rail but the experience in the United States with Amtrak, in a country with a much larger travelling public to support such a venture, has brought a mixed reaction. I wonder what our experience in Canada will be. In light of these uncertainties, we believe that this is not the time to consider Bill C-17 and that it would be more sensible to defer it until these various uncertainties have been cleared away.
Now I would like to make some comments about a subject that is of great concern to me and to my constituents, that is, railway abandonment. It continues to be a very hot topic in Manitoba, particularly in my constituency where there are so many branch lines. Perhaps the reason is that, according to the Hall commission, the province of Manitoba was the province most "overbuilt" with railways during the great period of railway expansion in Canada from about 1880 to 1920. The result is that today there is a multitude of branch lines in the province which are concentrated in the narrow southern quarter of Manitoba. Most of these lines are not economical and some have already been abandoned, or will be soon.
In the central Interlake region of my constituency there is an 80 mile long CNR branch line which is known as the Inwood subdivision. The grain receiving points on this line are three Manitoba pool elevators, one at Broad Valley, and two at Fisher Branch. The Fisher Branch facilities were expanded not too long ago. The amount of grain handled by these three elevators fluctuates, depending on the type of crop year in that region. As of March 1 of this year, the three elevators at Fisher Branch and Broad Valley together handled a total of 8,585 metric tonnes of grain. In other words, this is what the Inwood line handled in the first three months of this year.
The Hall commission recommended that this line be abandoned. I am against the abandonment of this line, and I have always been. I want that clearly understood. I have argued for the retention of this line as part of the basic rail network on many occasions. However, the Hall commission recommended its abandonment, in spite of my representations as well as
May 10, 1978

those of many others, of course, made to Mr. Justice Hall and to the other commissioners.
For the Inwood line, the Hall commission made a unique recommendation. It suggested that the two elevators at Fisher Branch be retained in service on the abandoned line as off-line loaders and that farmers continue to deliver to Fisher Branch. From Fisher Branch the grain would be trucked by commercial truck to the CP's Arborg railhead, which is about 20 miles distant. This off-line loading experiment has not been instituted by this government, and may never be. However, I have a great many reservations about the practicality of such an operation.
In the Interlake there are four branch lines. Of these, the Inwood line is the only one which is not paralleled by a paved provincial trunk highway along most of its length. There is some pavement in the north, but it is not parallel to the Inwood line. The roads are all low grade. The Inwood subdivision is in the very special position of being the primary mode of transportation in most of the area which it serves.
The principal commodity moved over this line is, of course, grain, but there is some other traffic as well. Grain makes up about 85 per cent of the total, pulpwood makes up 7 per cent, and the other 8 per cent is made up by coal, fertilizer, lumber, and farm implements and machinery. For the grain traffic, the Hall commission recommended the off-line concept. I must admit that I would be very interested to observe such an experiment in operation but, for all that I know of this region, it is not really an answer to the grain handling problems of the Interlake.
The biggest single reason that such an operation is neither practical nor viable is that the roads in the area are completely inadequate for large capacity grain trucks. The Inwood line runs through two of the three local government districts, or LGDs, in the Interlake, Fisher and Armstrong. These LGDs do not have the resource tax base to undertake the road development and upgrading which would be required for heavy hauling by truck. It is not only the expense of truck hauling, and which would be very great in any case, which is involved. There is also the consideration that trucking is an inefficient and fuel-wasteful means of transport as compared with the diesel locomotive which the experts variously estimate to be 18 times more efficient than the gasoline powered truck, based on ton capacity and fuel consumption.
In all of Canada only about 8 per cent of the total land is farm land, and this is declining every year. However, this is not true of the Interlake. If hon. members want to see a real frontier where raw virgin land is still being broken by the plough, they should visit the north central Interlake area of Manitoba in my constituency.
In the Dallas-Red Rose area Canada's arable farm land is being developed at present. This is in contrast to what is happening in most other parts of the country where agricultural land is disappearing. This is only possible in that part of the province of Manitoba because of the existence of the Inwood rail line. Even so, the local delivery point for these new farms now is Fisher Branch, which is more than 40 miles away for
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many of the producers. However, the off-line concept would involve a further haulage by truck from Fisher Branch to CP's Arborg railhead, a further 30 miles or so. Of course, this would make the new farms in the Dallas-Red Rose region completely uneconomic. It is clear that closure of the Inwood subdivision would effectively halt agricultural expansion in the north central Interlake.
When I last spoke in the House on March 2 about the problems of rail transportation in the Interlake, and about the Hall commission's recommendations for the Inwood line, I believe I stated that the farmers of the area wanted the commission's off-line experiment for Fisher Branch to be undertaken. The farmers have told me, however, that this is decidedly not the case. Naturally they do not want to lose their Inwood line, any more than I do. We are not against the experiment, but we do not want to lose our railway for the sake of it.
I should like to quote from a letter which I received a short time ago from the president of the Fisher Branch and District Chamber of Commerce, Mr. Tom Magnusson. I believe it sums up very well how the grain producers of the Interlake feel about the Inwood subdivision. In part the letter reads as follows:
... In our investigations locally, the farmers do not feel that the off-line elevator concept is indeed the most economical in the long term, nor even feasible, given the present infrastructure and circumstances. The Fisher Branch and District Chamber of Commerce takes the following position in support of our local farmers: (1) that rail service must be maintained to Fisher Branch through either (A) continuance of the present line and the upgrading of same, or (B) construction of a spur line from Fisher Branch-Broad Valley area to either the CPR Arborg line or the CNR along provincial trunk highway number 6; or (2) should the off-line elevator concept be instituted, that the CNR Inwood subdivision be left intact and maintained until the success and feasibility of the trucking operation to Arborg be determined. This would allow the CTC to reverse its decision if the trucking operation is not successful.
My position is exactly the same. It is the only way in which I would support the Hall recommendation. Mr. Magnusson's letter continues:
You will likely be aware of why our farmers have taken this stand. I would point out, however, that the data the Hall commission based its recommendations on is not without challenge and therefore the recommendations should not be etched in stone. In fact our information is that the Prairie Rail Action Committee has commissioned another study on the cost factors involved in this "off-line elevator" recommendation. Also, our last year's crop indicates that we indeed have a much greater production potential than the 750,000 bushel handle used by the Hall commission as the basis of their recommendation.
On many occasions the Prime Minister (Mr. Trudeau) stated that he believes that in Canada today nothing is carved in stone-not the constitutional arrangements, not federal-provincial relations, not anything. He is very flexible and willing to negotiate anything except outright separatism. Members of the Conservative party are not entirely convinced that all things are negotiable. However, in view of the government's stated willingness to be amiable and flexible, perhaps the Minister of Transport will re-examine the matter of the Inwood line and the recommendations of the Hall commission. Certainly there are extenuating circumstances here. In any case, the recommendations of the commission are now two

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years out of date. I urge the Minister of Transport to re-examine the entire question of the future of the Inwood subdivision.


Some hon. Members:: Hear, hear!


Joseph Adrien Henri Lambert: Mr. Speaker, I would like to make brief comments on the bill now under consideration.
The primary objective of Bill C-17 is to allow the CN to proceed with recapitalization. The conversion of the $800 million debt in no par value capital stock will allow the CN to reimburse the treasury through dividends on its earnings instead of being compelled, mostly in theory it must be added, to repay its debt. Considering that the CN balance sheet has shown profits for the past two years, that fact seriously prompts us to pass the bill. We would thus show our confidence in the management of that Crown corporation. In light of those factors, I feel that the bill is constructive. On the other hand, as a member of the opposition it is my duty to point out some dangers of giving carte blanche to the CN.
One of the indirect and no less significant results of the adoption of this bill would be to place the Crown corporation in a favourable position to borrow funds on money markets. This is not bad in itself, for everything would depend on the final use of these funds. If these funds are to be used to improve the railway system, make it more practical both for travellers and shippers, that is to serve the Canadian public better, this indirect result is desirable. On the other hand, if these funds are earmarked for investments in areas which are not consistent with the traditional vocation of the CN, I am against it. The CN is not an industrial and commercial holding company but a public utility. Its first function is to transport people and merchandise to destination, and to do so economically, whenever possible. It is a fact that there are circumstances where we cannot have both effectiveness and profitability. Under such circumstances, the service to the public must prevail over profitability, at least within certain limits. In fact, the CN is a Crown corporation because it is a recognized public utility. I feel many hon. members in this House would like to know more about the CN's medium and long-term plans in light of this possibility of getting new funds.
I know that several of my western colleagues are not satisfied with the CN performance in their region. On the other hand I would not like them to feel that everything is perfect in the east. If western shippers cannot find cars to ship grains, there is a similar problem in the east in relation with the lumber industry. Many lumber companies cannot get the cars they need to ship sawed lumber to American markets. Those companies are faced with the impossibility of meeting their delivery schedule and are therefore losing many new contracts. The problem does not stem from the employees' slow productivity or lack of leadership by the management which made efforts to get those contracts abroad. Everyone knows that the

government likes to use both those excuses to hide its negligence. No, in this case it is the lack of foresight by the Canadian National which is clearly responsible for those lost contracts.
I was saying the CN must not launch into all sorts of investment which are not within its field of competence. To this I would add that the CN will have to be monitored closely even for some investments which may be within its field of competence. A related example which comes to mind is the proposed acquisition of Nordair by Air Canada. Although by doing so Air Canada would stay in its particular area of competence, it is not at all certain this transaction would be to the advantage of travellers and Canadians in general. On the other hand, whoever cares to open his eyes will see clearly that this transaction would severely limit the possibilities of expansion of another airline, namely Quebecair. I do not think a Crown corporation should have the right to take advantage of some privileges that are peculiar to nationally owned corporations to harm privately owned corporations. That kind of abuse should never be allowed.
We will have to be on our guard and see to it that this kind of abuse does not happen in the CN. For this reason, I wish the government had taken advantage of the presentation of this legislation to introduce controls and the obligation for the CN to report on a more direct basis than it does now. I would not want this wish to be interpreted as a lack of confidence in CN management. On the opposite, as I said earlier those people are to be commended for their healthy Financial administration in the last few years. Indeed, the figures are revealing: in two years the CN went from a deficit of $16 million in 1975 to profits of $28 million in 1977. But if its record is so good, I do not see why the CN should be afraid of the right of representatives of the people to have some control and especially to ask some questions. We sometimes make a lot of noise in this House, but God knows that we are not so bad. After all, we are entitled to know about the operations of such an important company, a Crown corporation. It would be only normal for the elected representatives of the people to be better informed on the operations of this company.
Finally, I would like to suggest a possibility that I believe very progressive. Following passage of this bill, the CN will most probably decide to look for new capital on the money markets. According to tradition, these funds will come either from the Canadian market or, as is the case too often, from foreign markets. I believe that if the government really wanted to innovate and be progressive, it could consider allowing the Bank of Canada, which is the bank of all Canadians, to lend to the CN the funds it might need. Of course, the interest rate charged would be the minimum. Canadians should not exploit one another. It would be quite normal for them to co-operate.
Since the Bank of Canada belongs to the people, I think it would be quite normal for it to help a Crown corporation like the CN. Under the formula that I have suggested, the develop-
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ment of the CN would benefit all Canadians and not only the bankers, whether Canadian or foreign. Moreover, this would allow better control over the development of the CN since the loans could include very specific conditions which would meet the needs of Canadians. Mr. Speaker, I believe that this suggestion should be considered very seriously and I hope that, in doing so, the government will be open-minded and even innovative.
I believe that the cabinet should review this bill so as to include the means of financing this utility that I have suggested, which would make it more acceptable. This is why I sincerely believe that consideration of this bill should be postponed for some time as suggested in the motion which has been moved to allow the cabinet to make the improvements that I have suggested.


Elmer MacIntosh MacKay: Mr. Speaker, it may be, as Gordie Lightfoot said, there was a time in this great land when the railroads did not run, but it seems that must have been a very long time ago. I am always amazed in looking back at some of our history, economical and political, to find since how many years railways have had almost a fatal fascination for politicians, perhaps even before they did for economists.
Railways in Canada, said Robert McQueen in the "Canadian Historical Review" back in 1936, are far from being an economic problem. He said, they are born of, nourished in, are and will continue to be a part of Canadian politics.
Back in 1851 that great Nova Scotian, Joseph Howe, in a speech in Quebec, said in respect of railways, when talking about the future of what was then the colonies in North America:
To the advocates of legislative union I say, your scheme is impracticable without the railroads.
He went on to say as well, on another occasion:
I am neither a prophet, nor the son of a prophet, yet I will venture to predict that in five years we shall make the journey hence to Quebec and Montreal and Home through Portland and St. John by rail;-
This is the part that fascinates me:
-and I believe that many in this room will live to hear the whistle of the stream-engine in the passes of the Rocky Mountains and to make the journey from Halifax to the Pacific in five or six days.
He said that in Halifax on May 15, 1851.
With 127 years or so having passed, we are still not able to get to the Pacific from the eastern coast in much less than five days by rail.
I suggest, when we look at this particular bill and the amendment that I am speaking on today, we should consider why the railways, despite the fact that many hundreds of millions of dollars have been written off capital indebtedness, have been so slow in many areas to adopt modern technology.
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Since the war, for example, in the U.S.S.R., a country with climatic and geographical conditions resembling Canada, we have seen the electrification of literally thousands of miles of railway track. This point was made very strikingly by Professor J. Lukasiewicz, a well known Carleton University professor, who has written from time to time on both the modernization and the obsolescence of the Canadian railway system.
As members of parliament, and as Canadians, I think we should demand to know more from the top management of the major railways in this country why they have been so slow to adopt in trains what would appear to be fairly rudimentary technological advances. Now with the advent of VIA Rail, the Minister of Transport (Mr. Lang) quite rightly is emphasizing that it would be to the advantage of all Canadians, for many reasons, to promote greater use of passenger facilities. Yet I do not understand why more has not been done to make the use of railways more attractive to businessmen and, indeed, to all types of commuters and passengers.
I believe it is possible in this day and age for railway passengers to be provided access to telephones so that businessmen, for example, who wished to make a trip from Montreal to Toronto or from Montreal to Halifax would be able to use the railway as sort of a mobile office, if they had reasonable access to radio or some other type of telephone communications.
The same is true, I suggest, of other technological advances that could be brought in to make the trains more attractive for a journey which is, of necessity, much longer than one has to endure by aircraft. Why should television not be available in some parts of the modern train? Why should there not be a rudimentary library available, and a more attractive and less expensive canteen service? All these things would do a great deal in a practical way to help encourage greater usage of the railways. This, of course, has to be the bottom line; if railways are not used by a greater percentage of travellers, then certainly they will not be profitable and we will continue to be the recipient of requests by the CNR to come in every once in a while and write off several hundreds of millions or, as one member said, "another great train robbery" at the expense of the taxpayers.
I think it is also pretty obvious that the benefits the legislation we are discussing today is supposed to provide, while superficially attractive, are not necessarily indicative of what will really happen. We are told that one of the main purposes of the bill is to convert approximately $800 million of debt owed the government by the CNR to equity. A lot of benefits are supposed to flow from this. We are supposed to eliminate the necessity of the federal government picking up deficits which occur from time to time.
We are supposed, as well, to improve the debt-equity ratio, as was done recently with our national air carrier, and it will also supposedly free the government from having to purchase 4 per cent of preferred shares at an annual cost to the government of $80 million, which supposedly is based upon 3 per cent of the gross revenues of the CN system. However, it was well documented before the committee that the governmemt was never obliged to purchase preferred shares of the CN from

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1960 onwards. The government was compelled to purchase the shares only from 1952 to 1960 as stipulated in the 1952 recapitalization act. However, the statement that was first made in this House by the Prime Minister (Mr. Trudeau) some time ago, that the passing of Bill C-17 would be an automatic saving to the public of Canada because of the readjustment of the capital structure, is not at this time very self-evident. It places the bona fides of the entire bill under some suspicion.
As I understand it, the CNR has proven that it is going to make a modest profit in the next few years anyway whether this bill is passed or not. The projection for 1979 is a profit in excess of $60 million without Bill C-17. If it does become law the projection is for $136 million profit. By 1982, the profit, if Bill C-17 is not passed, is supposed to be in the vicinity of $140 million, whereas if it is passed the profit will be $267 million. This may be, however laudable the bottom line from the point of view of the accountant or economist, an excessive profit, taking into account that CN, like Air Canada, also has a primary duty to provide service as well as to make a profit. Ideally, of course, they have to do both, but to concentrate too much on the profit motive is not necessarily in the best interests of either the railway or the country.
Coming back to the object of the CNR and how, in the past, I feel in some ways it has been derelict in its duties, I would like to make a suggestion to the Minister of Transport, and to CN management as a whole, that greater emphasis be placed on carrying non-perishable commodities by rail. It is not only inefficient, as my colleague from Portage just pointed out, to carry some of these commodities by truck, but it is also energy wasting and very destructive to our highways. Pulp wood, particularly in the province of Nova Scotia, is one of the commodities that lends itself to being moved far more efficiently by rail. In doing this it would be more energy efficient, make our highways safer and less congested, and it would also be a much more satisfactory method for the industry.
However, herein lies another problem, Mr. Speaker. Car allocation by the CNR to do this, periodically presents a problem. It presents a problem in my constituency for many industries, but principally it presents a problem for pulp companies. Another problem that we find is that the CNR is not very aggressive in its attempts to go after new business, which is part and parcel of making railways profitable. Like most businesses, if you do not achieve a reasonable amount of volume you are not going to be able to achieve very much efficiency. The Halifax Chronicle-Herald in an editorial a few weeks ago commented, and they were speaking about the CNR at the time:
The railway has not made an impressive showing in seeking new business. One wonders, for example, how much better business might be on the south shore line (of N.S.) if as much energy has been poured into an aggressive marketing and service as was expended in trying to get permission for abandonment.
Assuming that the railways eventually gets the benefit of this recapitalization, and assuming that management have additional funds, either as a result of the capital they generate

in profits or as a result of the benefits which parliament may see fit to give them, surely they must undertake a comprehensive effort to purchase more railway rolling stock and to upgrade not only the quality and quantity of their cars- refrigeration cars, pulp cars, flatcars, and so on-but they have to do some more meaningful work on upgrading the roadbeds. It is literally possible between Halifax and Montreal, on some of the passenger trains, on the steep grades, to jump out of the car and run alongside the train for several hundred yards, and get back on again. I do not know whether or not this is a fault of the diesel engines that are pulling the train because they are under powered. I rather suspect it is as a result of the conditions of the roadbed in some areas, which make it very hazardous for these trains to achieve a reasonable amount of speed. When one examines the average speed of a passenger train in Canada, and I am relying on my memory for this and going back to something that Professor Lukasiewicz wrote, it is something around 35 miles an hour, which is a very painful contrast to the 500 miles an hour that one can achieve with most jet aircraft today.
Railways must also take a more human view and more direct interest in their customers and employees as well. As a member of parliament I have received representations from people who complain bitterly that the service reps and the railway management in general are not interested sometimes in providing cars for some of their seasonal and short-term needs. I would trust, in connection with this more or less general consideration of the future of the CN, that management will take a sweeping look at their sales promotion techniques as well as their labour-management techniques because, as I started to say a few moments ago, at times the shortage of railway rolling stock is exacerbated by the fact that many of the needed cars are kept in the United States and cannot be recalled to Canada during certain peak periods of usage when they are needed.
I am quite prepared to admit that I have a special interest in seeing the CNR purchase a reasonable amount of modern and much-needed rolling stock. In my constituency in Trenton, Nova Scotia, we have one of the most capable railway producing industries in Canada, or in the world for that matter. As I said publicly a few days ago, I want to express my appreciation to the Secretary of State for External Affairs (Mr. Jamieson) for keeping me informed, and for his encouragement in making certain that we recently had an order for railway rolling stock for the continent of Africa, and he indicated several other countries where we might expect further business. The Secretary of State for External Affairs went on to say at that time that one of the reasons that Canadian manufacturers in this area are able to compete internationally is because of the efficiency and capability of our domestic industry. I am particularly proud that we have an industry in Nova Scotia that, despite its geographic disadvantages, has proven over the years that it can produce a very fine product.
One of the obvious failures of Bill C-17, and one of the justifications for this particular amendment, is that it is not necessarily the time to pass this legislation until we see, for
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example, what the Sullivan commission in Newfoundland is going to say, until we see how the activities of VIA Rail are going to be reflected throughout the system, and particularly because Bill C-17 does not appear to provide or strengthen accountability to parliament to any significant degree.
Coming back to the primary purpose of our national railway system, our transportation policy in general has always been based on competition where market forces are in play. There has been some vacillation in this regard over the years. The current Minister of Transport has brought forward a user-pay policy, and his predecessor had a different policy, in some cases there was no policy, and in some areas there may still be none, but by and large any transportation company of the size of CNR affects to a great extent the entire transportation network across the country.
It is fair comment to say, and it may have been said already, and perhaps the CPR has said something about this as well that the CPR has been very, very quiet on this particular bill, and I am wondering why that is. Do they see it as a forerunner to the nationalization of the CPR? It is no secret that CPR in recent years would have been very pleased to get out of the transportation business.
For several reasons, some of them have been stated by previous speakers and some I have enumerated today, it will do no harm and it will provide a better opportunity to assess the whole situation with regard to our national railway system if this particular piece of legislation is given a six-months' hoist and not passed at this time. There is no particular need at this time for this bill to be passed. Therefore I am pleased to speak in support of the amendment of the hon. member for Lisgar (Mr. Murta).


Dean Waldon Whiteway: Mr. Speaker, I appreciate the opportunity to speak on the amendment standing in the name of my colleague, the hon. member for Lisgar (Mr. Murta), regarding Bill C-17, an act to recapitalize the CNR.
I am far from being the oldest member of this House and yet I can remember in my lifetime-and I do not mind saying I am under 34 years of age-of going up to what we called the "tank" in Shelburne, Nova Scotia. Literally it was a tank on a tower by Blacks Brook. Anyone from the south shore of Nova Scotia will certainly know where Blacks Brook is. Once or twice a day the steam engines would come up to the tank at Blacks Brook and fill up, and I used to watch them. So, in my lifetime we have changed from that kind of locomotion in the rail industry to the modern diesels.
I can remember the first day when a diesel came down the tracks into Shelburne and the whole town turned out. It was a great spectacle to see what a diesel engine looked like. That is all in my short lifetime.
I am in support of the amendment that will hoist this legislation for some six months primarily because of what the bill and what the government have not done. Here it is, May 10, 1978, and we are in the House of Commons without
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legislation regarding rail transportation within our cities-I am talking about modern rapid transit systems-despite the promises made some four years ago during the election campaign of 1974 by this government. I have a copy of those promises. I see the Minister of Transport (Mr. Lang) is in the House. I know that this government hoped that these election promises had been lost. But not so, sir. I diligently kept them over the years. Later on I will read them to this government and ministers can hear what they promised to do for rail transportation in this country.
Why should this bill not contain matters relevant to rapid transit systems? There are several reasons. Our major centres in Canada are centres of consumption. We know that right now some 65 per cent of Canadians live in urban centres. In another ten to 12 years, at least by 1990, 90 per cent of Canadians will live in urban centres, and yet today we do not have in place in Canada a strategy for rapid transit systems for our major centres. I am speaking of Montreal, Toronto and Vancouver, at least those three cities, if not others.
We know as well that this country is facing an oil gap. Prior to 1975 the term "oil gap" was unheard of. It was not in the vocabulary of Canadians. We know that at the moment half of the energy consumed in Canada in terms of oil and gas is in intra-city transportation. By the projections of the National Energy Board, and I am somewhat alarmed as other Canadians are that these projections change from time to time, their last projection showed that we will be facing a critical shortage of energy within the next 15 to 20 years. This means that Canada will import offshore oil in an amount of around 25 per cent to 30 per cent of our needs.
If we could put into place in our large urban centres, which will house 90 per cent of Canadians in another decade, mass rapid transportation systems that Canadians in those cities would use, we could effectively reduce the energy consumption of the automobile by 25 per cent. Translated to the national scene that would mean a saving of at least 12 per cent to 14 per cent of our oil needs. If that is then projected ten to 15 years hence, we are talking about a dramatic reduction in our reliance on offshore oil.
Lastly we need mass rapid transit systems in our cities because of the quality of life Canadians expect to find in large urban centres. Surely every member in this House has been in an automobile in a traffic jam at rush hour. These traffic jams could be avoided by rapid transit systems. Yet, we are debating a bill that would recapitalize the CNR and there is not a murmur from this government and the minister relating to mass transit systems. It is difficult to understand that a government that has been in power for 15 years in this country has yet to put in place that kind of a national urban transit strategy.
I see the former minister of consumer and corporate affairs in the House. He is from Toronto and I hope he stays around for awhile because I will have some things to say about him.
Just a couple of weeks ago the Premier of Ontario, the Hon. William Davis, took up a chisel officially to start a $58-million program in alterations in Toronto's union station. I do not

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know whether my friend, the former minister of consumer and corporate affairs was there, but I would not expect so because he would be somewhat embarrassed by the fact that the province of Ontario has had to go it alone. I do not live in Toronto but I have been there and I have been to Union Station. Union Station ought to be perserved for history. Sir, that is a usable archive. If hon. members have ever been to Union Station during lunch hour, they will have noticed that it is jammed packed with people. The vision of the Ontario government was its GO Transit service. It has gone it alone to modernize and upgrade the facilities, especially at Union Station.
This government promised $100 million of the $258 million for mass transit systems in this country, and in particular for metro Toronto. Of the $58 million the province is spending, at least $26.5 million should be coming from the federal government as said by those election promises made in June, 1974. We have facts with relation to Toronto. However, there is another city that found it necessary to go it alone, Edmonton. That is as a result of this government reneging on its grandiose statements and promises which it makes so fluently during an election campaign.
The city of Edmonton had to go it alone for $65.9 million. The provincial commitment was $45 million, and $20.9 million for the city of Edmonton. The federal government did not put up even one devalued dollar, in fact not a penny. The province of Alberta and the city of Edmonton pleaded with them to put into place a mass rapid transit system there.
I could speak of the south-west transit study in my city of Winnipeg. That study was undertaken as a direct result of the election promise in 1974. I know the former minister of consumer and corporate affairs is anxious to hear about that. I am sure he is one of the Liberals who hopes these promises will be long forgotten by Canadians.
Because of the promises made during the election campaign in 1974, Manitoba, and in particular Winnipeg, undertook the south-west transit system study to see whether it would be feasible to use existing rail lines owned by CNR and CPR which run from downtown Winnipeg to the university. That is the most heavily populated area of Winnipeg. Phase two, and a million and a half dollars later, the then mayor of Winnipeg, Mayor Juba, a fine man who has done our city proud, received word that the game was off, he would have to go it alone.
What was the result? Neither Winnipeg nor Manitoba has the kinds of funds that it can commit up to $100 million for a mass rapid transit system. The dream of Mayor Juba and of many Winnipeggers of a uni-rail or a rapid transit system went down the drain. A million and a half dollars later, that study had to be shelved because of this government reneging on its promises.
I am going to quote from a document dated June 17, 1974. The Minister of Finance (Mr. Chretien) has just entered the Chamber. His eyes lit up because he recognized that date. The Prime Minister (Mr. Trudeau) was speaking in the great city

of Toronto. What I have in my hand is a copy of the very paper that the Prime Minister held in his hand on June 17, 1974, in Toronto. Your Honour will recall that the election was on July 8. We were only a couple of weeks from polling day. I will read only the main points of what the Prime Minister said. I quote:
The Liberal government will-
Notice the word "will", not maybe, hopefully, or "we promise." He did not say the Government of Canada, the government of the nation, but the Liberal government. That did not commit the opposition or the hoped-for Stanfield government. He said:
The Liberal government will pay 100 per cent of the cost of new commuter vehicles manufactured in Canada,.. .
The Liberal government will pay 25 per cent of the capital cost of all vehicles purchased each year for public transit within Canadian cities and which are manufactured in Canada.
Financial support will be made available to encourage Canadian design ...
For Canada's smaller municipalities, the Liberal government will offer assistance ...
Canadian industry will be encouraged to develop "off the shelf' standardized systems ...
The Liberal government will encourage urban transit systems innovations,...
The Liberal government is committed-
I looked up the word "committed" because I wanted to know exactly what the Prime Minister was getting at. I looked it up in both the Oxford and Webster dictionaries. I certainly did not want to be biased in any definition I might find. Forgive me, Mr. Speaker, but I have a cold. Otherwise I would be much more adamant in what lam saying today.


Jean-Jacques Blais: More eloquent, too.


Dean Waldon Whiteway: The Solicitor General (Mr. Blais) has just entered the chamber. He speaks well in both official languages, but says nothing in either. I am glad he has come into the chamber to be refreshed with regard to these Liberal government pledges and promises of June 17, 1974. I was talking about the word "committed". It means entrust. The Prime Minister was saying that if the Canadian people would elect a Liberal government, that government would entrust. That is a very interesting word for this government.
The Liberal government is committed to removing the 12 per cent sales tax-
That was four years ago.
The Liberal government will offer the best use of existing railway rights of way and track in urban and suburban areas for new commuter and urban transit lines-
It was that which precipitated the south-west transit study in Winnipeg. On February 16, in Toronto, that was scrapped after a cost of $1.5 million. What is a million and a half dollars to this government which this year is spending $10 billion it does not have?
The Liberal government will rapidly implement the Railway Relocation Act, to ensure that railway relocation in cities also contributes to the right kinds of city growth.
I am not saying the only reason the people in Toronto voted Liberal was because of that statement of the Prime Minister,
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but it certainly gave them something to hope for, a vision, a dream, a quality of life, that they would no longer have to ride in automobiles along crowded streets during rush hour.
It was promised that the Union Station would be upgraded. There would no longer be the mass confusion that exists in Union Station. In large part the hopes of Torontonians were placed in this government because of those promises made on June 17, 1974. This government was re-elected. I do not know exactly how many members it has from metro-Toronto, but I expect the number would be around 18 or 19. Two years passed. Then came the black day for Toronto, indeed for all urban centres in this country which had placed hope and trust in this government as far as urban transportation is concerned.
On February 16, 1977, at eleven o'clock in the morning, the then minister of finance, Mr. Macdonald, made an announcement. The headline in the Globe and Mail for that date read "Promised in 1974, $290 Million Transit Plan Dead". It was finished. Two years before that the cities and municipalities were told that the government had a scheme, that they could count on the government. Two years later, when half the cities across this country had proceeded with plans, they were told that the government was withdrawing, the game was over. First they were in, then were out; now they don't know. This is the kind of government we have.
Here it is May 10, 1978, and we have not heard a peep, not even a squeak, about urban transportation. I expect the game plan is to wait until the writ is issued. Then they will take this sheet I have been reading from, resurrect these policies, and reprint it word for word. Well, it will not work. Canadians will not buy it. They do not trust the government.
I have other articles here. This is from the Globe and Mail of March 3, 1977: "The Liberals Might Break Ranks Over Transit Grants". The subheading reads: "Broken Election Promise Upsets two MPs." There was a great stir among the backbenchers of the Liberal party at that time. The members from Toronto were not going to stand for what was happening. They were elected on this promise and they were determined to stand up and be counted. There was a revolution, and one of the leaders was the hon. member for York East (Mr. Col-lenette). We understood that all the Toronto members were joining. The ranks of the dissidents were growing daily to swell the strength of the revolution and oblige the government to make good the promise it gave in 1974. Mr. Speaker, I am sorry to say that the revolution was stamped out. It failed.
I want to go over the list of those revolutionaries and name them by their constituencies. There was the Minister of State for Small Business, the hon. member for Mississauga (Mr. Abbott). He failed. There was the hon. member for York South (Mrs. Appolloni). The hon. member for Davenport (Mr. Caccia) failed. The hon. member for York East failed. The revolution he started was stamped out. The Minister of National Defence, the hon. member for York North (Mr. Danson) failed. The Minister of Energy, Mines and Resources (Mr. Gillespie) failed. The hon. member for York Centre (Mr. Railway Act
Kaplan) failed. The Parliamentary Secretary to the Minister of Consumer and Corporate Affairs, the hon. member for Scarborough West (Mr. Martin) failed. The Parliamentary Secretary to the Minister of Supply and Services, the hon. member for Trinity (Miss Nicholson) failed. The hon. member for Scarborough-East (Mr. O'Connell) failed. The hon. member for Halton (Mr. Philbrook) failed. I remember him.
I raised this very matter only a couple of days after this bitter blow to the urban centres of this country and I remember the hon. member for Halton getting to his feet to speak- he, certainly, did not intend to allow this promise made in June, 1974 to be forgotten. He failed as well.
The Secretary of State from St. Paul's (Mr. Roberts) failed. The Parliamentary Secretary to the Minister of National Health and Welfare, from Toronto-Lakeshore (Mr. Robinson) failed. The hon. member for Eglinton (Mr. Sharp) failed. The hon. member for Spadina (Mr. Stollery) failed. I want to get all this on the record because those are the ridings which returned members of parliament who supported the Liberal government which on June 17, 1974, promised through its leader to provide a mass rapid transit system to meet the needs of the urban centres of Canada, in particular, Toronto. Yet today we are asked to debate a bill which has to do with the recapitalization of the CNR involving the transfer of millions of dollars from debt to equity. The government expects the opposition to agree to this notwithstanding the fact that the promise made in the election campaign of 1974 has been so flagrantly broken.
Bearing in mind the dearth of information which has been given to parliament on this subject, I think it is an act of responsibility on the part of my hon. friend from Lisgar to move that the bill be given a six-month hoist. It is idle for the government to expect us to pass this bill in the absence of proper information on the subject. Moreover, as my hon. friend has stated, the CNR will probably make a profit this year in any event. I oppose the measure for these reasons, but mainly because I, for one, along with most of the people who live in this country, cannot trust the government to do what it pledges it will do for the people.


John Carnell Crosbie: Mr. Speaker, I, too, am glad to join with other members on this side of the House in trying to give this bill a six-month hoist, and I hope that if the Prime Minister (Mr. Trudeau) can summon up his nerve tomorrow we can start the campaign to give the government a 20-year hoist.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: I never thought a couple of weeks ago that we would still be in the chamber talking. I thought we would be into the election now and that the people of Canada would be given a chance to decide whether this shambles opposite should continue or whether it should be brought to an end. But we are still here. Hopefully, tomorrow we shall be off. So I am assuming, now, I am speaking on the last day of this parlia-

May 10, 1978
Railway Act
ment. I wish all members opposite Godspeed and I shall miss them here in the next parliament.


Some hon. Members:: Hear, hear!


Mr. Faulkner:: We shall miss you!


John Carnell Crosbie: The bill should have a six-month hoist and the government should have a 20-year hoist. My hon. friend from Selkirk said the government had made some commitment in 1974 in Toronto. I say the government itself should be committed. That would put an end to it all. Hon. gentlemen opposite should be arrested on a charge of impaired governing. There should be an amendment to the Criminal Code to provide for impaired governing. Why should we pick on impaired drivers alone? Hon. gentlemen opposite should all be in the hoosegow.
I am glad to see the Minister of Transport (Mr. Lang) is taking his seat. I spoke in the adjournment debate on May 2. At that time I expressed my opinion on the action of the Minister of Transport and delivered a heartfelt wish that his 29-month tenure as Minister of Transport would soon be concluded. However, despite my words of warning, the hon. gentleman is still there, hanging on. I am glad he is here this afternoon. I do not want to repeat what I said on May 2.1 was talking then about the action which was needed to repair the damage done to the trans-Canada highway in Newfoundland by the action of the CN and government, or by their lack of action, in diverting most of the freight and express from Newfoundland on to the trans-Canada highway. The highway itself is a rather inferior, narrow highway, not up to mainland standards. As I said the other night, the slogan in 1965 was "We'll finish the drive in '65, thanks to Mr. Pearson." That had a certain right sound to it.
This year the Minister of Transport has acted in a somewhat unfriendly fashion. He said he was only prepared to assist Newfoundland in improving and renovating the trans-Canada highway to the extent of 50 per cent of the cost. He brutalized the Newfoundland government into finally surrendering and accepting his offer-it was 50 per cent or nothing, and our government certainly cannot afford to spend $250 million on the trans-Canada highway in the next ten years out of its own coffers. So they had to accept this 50 per cent offer. The new slogan in Newfoundland is, "We'll drive at risk and with a bang until we're rid of Otto Lang." That time is coming. If the Prime Minister does his duty as a patriot and as a citizen of Canada he will call an election tomorrow and we shall terminate this whole business. Members opposite who want a copy of my remarks concerning the trans-Canada highway can just notify my office and we will send a copy to any member who missed my speech on that occasion.


Otto Emil Lang: Do they come autographed?


John Carnell Crosbie: They can be autographed if necessary. Now, Mr. Speaker, to come back to transportation-


Mr. Dionne (Northumberland-Miramichi):: Can you write, John?


John Carnell Crosbie: That is the hon. gentleman from New Brunswick there who signs all his mail with an X. I must say it much faster if you just put the old X there, and you do not have to sign your name.
To come back to transportation, Mr. Speaker, and this bill which deals with the CNR which is in all facets of transportation-and therefore we can be in all facets of transportation in discussing this-there was a commission appointed in March of 1977 to consider the state of transportation facilities in Newfoundland, the Sullivan commission, chaired by Dr. Art Sullivan, and an interim report is to be made by that commission by the end of May to the minister. What has happened to the commission is that Mr. Esau Thoms, from Freshwater in my district, Mr. Speaker, who was a member of the commission, has become seriously ill, which is sad news to all those people in Newfoundland who know him.
He has been a railway union leader for many years and has done a lot of work for the federal government on commissions and groups like that studying transportation questions. Esau has become seriously ill. The commission is putting in an interim report based on the recommendations that he had agreed to up to the time he became ill. They are naturally hoping that he will be back with them to complete the report, but the final report will not be in for some six or eight months because of it. Now, when the commission was appointed it was hoped that it would conclude its report by the end of '77. That has not been possible, so in speaking today, Mr. Speaker, I want to take this opportunity to express my hope that Mr. Thoms' health will improve and to let him know that we are thinking of him and that many people in Newfoundland are thinking of him and hoping that he is going to recover and continue his valuable contribution to our province.
Now, Mr. Speaker, there was a royal commission on transportation in Newfoundland in 1962, and it must have been a royal commission that had never heard of the phrase "user pay" that became the motto of the present Minister of Transport.


An hon. Member:: An Otto motto.


John Carnell Crosbie: It became the motto of Otto. It's going to become the political death of Otto also.
There was an article in the Newfoundland Telegram on March 5, 1977. There is a cartoon in it about government taking over rail service, and somebody's got marked here, "It's too bad Newfoundland is not a part of Canada". Mr. Speaker, I come from the only province of Canada that has no railway passenger service. It was assassinated by the Liberal government in 1967 with the connivance of the then Liberal premier, Mr. Smallwood. He was an accessory before the fact and an accessory after the fact to the killing and the assassination of the railway passenger service in Newfoundland, and therefore he bears a lot of guilt particularly, Mr. Speaker, because in return he got an inferior trans-Canada highway that is less
May 10, 1978

than the quality of the highway in every other province of Canada and which now in 1978 is a fearsome sight indeed as you drive along that highway because of what has happened with the traffic it has had to bear in the last ten years.
This commission was the MacPherson commission of 1962 appointed by the right hon. gentleman from Prince Albert and his government. They did their study about ten years after we entered confederation, and they said, and I quote:
The situation in Newfoundland is a special case distinct from the rest of Canada.
That was a finding of this commission, and our case is distinct from the rest of Canada. They went on to say, and I quote again:
The situation in Newfoundland is such that it may prove necessary in the short run to eliminate competition, to favour by subsidization or special treatment one mode (of transport) against another... and to do other things that would be totally unacceptable in other parts of Canada ...
The Liberal government certainly adopted part of that quotation because they have done things that would be totally unacceptable in other parts of Canada. They did away with our rail passenger service, Mr. Speaker. That is one of the things they did, so they did not carry out that recommendation, but they decided to do things that would not be acceptable in any other part of Canada, and we are not taking it lying down, Mr. Speaker. Another thing that they did and the minister did-and this minister is responsible-this Minister of Transport was the minister on July 16, 1976, when an order in council was passed here at Ottawa removing the CN bus service which had replaced the railway passenger service, removing the CN bus passenger service from the jurisdiction of the Newfoundland Public Utilities Commission which had regulated their affairs and services and putting them under the Canadian Transport Commission.
The Canadian Transport Commission, the federal body, since July of 1976 has been in charge of rates and jurisdiction over the CN bus service. Mr. Speaker, that was done without consultation with the Newfoundland government. It was an abysmal example of barbaric federalism, of Kung-Fu federalism. It was a barbaric act of arrogance here at Ottawa just to do that without consultation with the province. And what has been the result? The CN bus service has been removed from the Public Utilities Commission of Newfoundland, and it has been left by the Canadian Transport Commission to do what it wishes. The first thing that happened, Mr. Speaker, was that they got an 8 per cent increase immediately, and then, Mr. Speaker, last year the CN bus-yes, 1977-the CN bus system decided that they had to have another increase of 15 per cent in bus fares down in Newfoundland. So they had gotten 8 per cent in March of 1977. All right, Mr. Speaker, that is an 8 per cent increase in March, 1977, for the CN bus system. Then they applied in August to the Canadian Transport Commission for another 15 per cent hike in their rates in what they charged consumers in Newfoundland, and they wanted that on October 1.
Mr. Speaker, do you know that the commission came to Newfoundland to have a hearing, I believe, in November of
Railway Act
1977? October or November. The commission said that they had to give them the 15 per cent increase, that they didn't have the power to stop them, although they hadn't concluded their hearing. They hadn't made a decision. The commission said that they were going to allow the CN bus system to have another 15 per cent increase in fares, and they would give their decision later. I believe the last hearing was in March. Sorry, the last hearing was held down in Newfoundland in late November, 1977. Now, Mr. Speaker, that is December, January, February, March, April-this is May. It's about six months. December, January, February, March, April-yes, five months, almost six months since they held their hearings and, Mr. Speaker, I checked again today with the Canadian Transport Commission, and there is no decision yet on that application, and the CN for the last five months has imposed these higher fares, the 15 per cent hike, and the Canadian Transport Commission has not brought down a decision. Well, what are we in Newfoundland? Are we to be treated as nothings by the Minister of Transport opposite and his federal agencies here in Ottawa?


Mr. Murta:: They just don't care.


John Carnell Crosbie: All the CN has to do to get a fare increase is to make the application, and the Canadian Transport Commission says they can do nothing about it, and this commission comes and holds hearings and does not give an answer and does not make a judgment or a decision for five months. I say, Mr. Speaker, if the Minister of Transport and the Canadian Transport Commission .cannot do better than that, he should put CN bus services back under the jurisdiction of the Public Utilities Commission of Newfoundland where they were not allowed to have increase until the rate hearings were over and the board had made a decision. Since the Minister of Transport took them away from the jurisdiction of Newfoundland in July of 1976 they have had increases in fares of 23 per cent, Mr. Speaker-23 per cent-and they are getting away with murder. They can do what they like.
Either there is something wrong with the Canadian Transport Commission, either they have not got enough personnel, they have too much work, or the committee that deals with these things has got too many hearings. Surely this is not right that the CN can apply and get an increase in their bus fares last October and the committee has the hearings in the fall of 1977 and there is still no announced decision. What is to happen if they decide they should not have had 15 per cent? How are you going to be able to prove who were the bus passengers and decide how much each bus passenger should get back if the board finds they should not have taken that 15 per cent increase?
Now, Mr. Speaker, that is just one example of how we are being treated in Newfoundland by the Canadian Department of Transport and its minister and the Canadian government. We do not like it, and we are not putting up with it. We have heard no one from the other side say anything about it. It is left to us poor people over here in opposition to raise our voices against this high-handed and arbitrary treatment by the

May 10, 1978
Railway Act
Canadian Transport Commission and the CN bus service. They are not strange bedfellows, but they are certainly in bed together if better than this cannot be done.
So I bring that to the attention of the House, Mr. Speaker, as some of the things that have been done in Newfoundland. It is totally unacceptable in other parts of Canada, but because it is down in Newfoundland, it is out of sight, out of mind. Only when we, members here, are aggravated or provoked, does anybody up here hear about it, and even then it is difficult to get coverage on the mainland, unless it is under Standing Order 43.
The MacPherson commission of 1962 went on to say the following. It pointed out that no part in Canada had prospered until it had good transportation facilities. It stated:
The history of Canada is replete with examples of massive public spending on transport facilities such as canals, railways and more recently highways and airports... There is no question that the economy of Newfoundland cannot develop at a satisfactory pace without more transportation facilities. A highway network of the size necessary is beyond the present (1962) resources of Newfoundland ... The situation calls for assistance by the federal government and there are enough precedents for such a program.
This is still the situation 16 years later. The MacPherson commission's principles were never implemented. The Minister of Transport is not interested in doing anything in Newfoundland except to decrease his expenditures and costs. He is trying to crush with an iron heel the minister of transport in Newfoundland, and he is threatening the Newfoundland government that if they do not accept 50 per cent for reconstructing the trans-Canada highway, they will get nothing, not a sou. He sweetened it by saying that they would help Newfoundland with the cash flow, if it surrendered, which Newfoundland had to do, that the province would get 75 per cent of the money spent, the following year, a different percentage, and the third year 50 per cent, or in the third year it would decline to 25 per cent. In other words, the Newfoundland government will get 75 per cent now, but over a three year period it will receive a contribution of 50 per cent from the Government of Canada.
The provincial minister of transport has accepted this on the condition that if the Sullivan commission makes a contrary recommendation or recommends that the federal government should give more assistance, the Minister of Transport will agree that the trans-Canada highway can be opened up. Of course, the Minister of Transport wil not be here when the final report comes in. God willing, and the public of Canada willing, we will be over there dealing with that matter fairly and justly next fall.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: Some people think that Newfoundland should lose its rail service altogether. We are not losing the rail service. I do not care what any royal commission recommends, there will be a rail service in Newfoundland and it will not be taken away from us. Unless the rail service is totally abandoned in Canada, it will not be abandoned in Newfoundland.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: We know what CN points out. CN did not come out before the commission and say we should abandon the rail service. It stated that their total loss on rail express in 1976 amounted to $24 million. Of that amount, CN rail lost $14 million-$7 million was lost on CN express and $2 million on the road cruiser service, the bus service. The total loss was $24 million. I do not blame the CN entirely for what has happened in these areas; I blame the government for it.
I should like to quote now from the Evening Telegram of Wednesday, September 21, 1977, reporting on CN's presentation to the commission. It says:
CN, like many other witnesses before the commission, feels the only possible way the rail service can be improved is by direct federal subsidy for losses.
We know that the minister does not like to hear that. This is a rail service that will not break even, not without a lot of money spent on it first. Mr. Gratwick of the CN told the commission that in Newfoundland we should do the same as is done out west. This sounds like an excellent suggestion, but I do not know that it is as easy as this. He said:
You apply to abandon a railway and then you get a federal subsidy... That's what happens.
If that is what happens out west, we want some of the action. We have no objection whatsoever to CN applying, or we can apply, to abandon the railway and that the federal government should then come in and give us a federal subsidy so that the railway can operate the same as it does out west.
The article goes on to read:
He suggested the same argument might not stand up in Newfoundland, but added, "I think it's worth a try."
The CN Railway in Newfoundland was owned by the Newfoundland government before 1949. It was taken over by the Canadian government and is operated by CN. The Canadian government should meet the deficits if deficits are unavoidable, but the Canadian government has not done that. The Canadian government has allowed losses on the Newfoundland railway to be absorded by CN, and CN, in their attempt to lessen their losses, has done everything it can to trash the Newfoundland railway, to let it go down and to put the freight and the cargo on the highway. It does not want more losses. So it is up to the Government of Canada to meet these losses directly.
The article goes on to read:
He said an application can be made for the abandonment of a "branch line".
In Newfoundland, of course, the railway might not be considered a branch line. However, if the government wants to consider it a branch line, it can. That will have to be the solution in Newfoundland.
The railway's share of the freight traffic in Newfoundland declined from 87 per cent in 1971 to 61 per cent in 1976, and it has declined more since then. The number of employees on the railway in Newfoundland has declined considerably, by at least 200, according to the evidence before the Sullivan commission, that is, on the railway part of the operation alone, not including all CN services. In 1974 there were 1,891 employees with CN Rail; in 1976 there were 1,715, that is, 176 less. We
May 10, 1978

do not want this attrition to continue. Once the Sullivan commission has reported, we want the government to confirm that the railway service is continuing. Improvements will be made.
The railway is necessary because heavy freight and cargo should be moved by rail. Also, the railway is found to be a better conserver of energy than having everything hauled by truck or car. There is railway service in every other province of Canada-we want it in Newfoundland. That is what we want the government to say and do if the commission's report comes out before we take over.
A loan of $100 million was made by the government to CNR in 1952 with no interest charge until 1974 after the government was re-elected. Now there is an interest charge of $5.5 million a year on that loan charged to the Newfoundland service of the railway. When we consider what CN is allegedly losing in Newfoundland, let us remember that the Liberal government imposed a further $5.5 million interest burden on the Newfoundland service in 1974. That has been included in those figures.
What else is the minister doing? He is planning to have the Newfoundland railway abandoned. That is what he hopes will result from the Sullivan commission report. He has allowed CN to do everything they want in removing CN employees of CN Marine and other services, moving them to Moncton and other places, moving them out of Newfoundland. 1 do not know whether the minister has been successful in this as yet, but he wants to remove federal participation in ferry services in Newfoundland. That is spelled ferry, not fairy, the leprechaun.
There was an interesting article in the Globe and Mail of May 12, 1977, which pointed out the various subsidies which were paid to waterborne services in Newfoundland and other areas, but principally in Newfoundland. It stated:
The shortfall of the CN operated Newfoundland coastal service alone was $23.9 million.
I do not know whether the article was supposed to lead everyone to conclude that the coastal service in Newfoundland should be eliminated. We know the coastal service cannot break even, Mr. Speaker, but I do not think even the government wants to eliminate it. It pointed out that the ferry service to Port aux Basques required $44.3 million, while the run to Argentia consumed $4.59 million. "Consumed", Mr. Speaker! You see the weasel wording that is supposed to induce the reader to say to himself, "By God, Newfoundlanders are consuming our money at a rapid rate". The run to Argentia consumed $4.59 million. What is the run from Montreal to Toronto consuming? What is the run from Ottawa to Quebec City, if there is one, consuming? What is the run from Montreal to Halifax consuming? We only hear such weasel words when they are talking about service to Newfoundland.
Is that an argument to do away with the service from the mainland to Newfoundland, to Argentia and Port aux
Railway Act
Basques, because it loses money? We know it loses money. The ferry to Prince Edward Island loses money also.
Then they go on to say that the privately operated service from St. Barbe, Newfoundland, to Blanc Sablon Bay received $219,000 last year. The federal government now wants Newfoundland to take that over, Mr. Speaker. It wants to impose and push this burden on the province of Canada which can least afford any additional financial burdens imposed on it. The honourable crowd opposite who do not mind their own deficits in billions, are trying to push a $219,000 deficit, if you go on the vessel ferry from St. Barbe in northern Newfoundland to Blanc Sablon, on to the province. Then they say the ferry from Burnside and St. Brendan's-these are islands-St. Brendan's is an island off the coast of Newfoundland-they want to push $82,000 on to Newfoundland; and Cobbs Arm and Change Islands, $86,000. They want to push that on to Newfoundland. These are all in the district of the hon. member for Gander-Twillingate (Mr. Baker).
Then the minister wants to push on to Newfoundland the cost of the service between Carmanville and Fogo Island, $173,000; and from Greenspond to Badger's Quay, $55,750; and from Portugal Cove to Bell Island, $993,000; and from Middle Bay Islands to St. Patrick's, $209,000. All of these ferry services, Mr. Speaker, the Minister of Transport opposite now wants the Newfoundland government to pick up, assume, and carry that financial burden. What is wrong with the man? Has he any sense of honour or any sense of observing any commitments that this government has got?
Of the several millions of dollars of subsidies that the federal government has been paying out for many years, many of them were instituted because, Mr. Speaker, certain communities were resettled and the coastal boat service no longer went to these other communities. In other words, these services were instituted to assist the federal government which was saving money because the coastal service did not have to go to a lot of other small communities that were being resettled. Now ten years later the Minister of Transport of Canada said to the Newfoundland government, "You have got to take over these ferry services, and you have got to meet their losses". I mean, the man is a Barbarossa. He is a relic from the dark ages. He is Hagar the Hun gone berserk. This is user-pay to the utmost, Mr. Speaker. The Canadian public would have to be flagellating itself to re-elect the likes of them and put them back in power in Ottawa, Mr. Speaker. It would certainly be flagellating Newfoundland and giving us a whipping. The whip will be back on our backs if they are ever returned to office again. Now, Mr. Speaker, those are the certain ferry services the minister wants to force back on Newfoundland.
Then there is another peculiar group of subsidies, $3.6 million paid by the Government of Canada toward the major steamship service between Montreal, St. John's, and Corner Brook. There is a subsidy paid to Clarke Transportation. It has been going on for years. It is for them to provide a service from Montreal to St. John's and Corner Brook. The initial subsidy was $7 a ton. It was intended as interim assistance to Clarke Transportation. That subsidy has now gone to $15.64 a ton for

May 10, 1978
Railway Act
every ton of cargo they move between Montreal, St. John's and Corner Brook during the shipping season. That increase is not enough. Apparently Clarke wants the subsidy increased. They have a 13-year subsidy contract with the government now. It expires in 1986,1 am advised. They want the subsidy increased from $15.64 a ton up to $25 a ton, I think it is.
At the old rate of $15.64 it cost the federal government $3.5 million two years ago for that subsidy. Now Clarke wants a much bigger subsidy, because they want to get another ship to put on the Montreal-St. John's run. They want a bigger subsidy and a longer commitment because of that.
I took this matter up with the minister. I am advised that the government does not control the rates charged by Clarke. They are only indirectly controlled. Clarke files its rates, and the Liberal subsidy can be changed, depending on the revenues and profits of the company. The government has access to Clarke's books in the annual subsidy review. This is all done behind the scenes. We have no access to know what they are making or what they are not making.
In the meantime, other shipping lines have started services from the mainland to Newfoundland by sea: Newfoundland Container Lines, Ltd., owned by A. Harvey & Company, from Halifax to St. John's; and Chimo Container Service, owned by Chimo Shipping, Ltd. has inaugurated a service from Montreal to St. John's, using the vessel Sir John Crosbie.
Let me say that Chimo Shipping Ltd. is owned by relatives of mine. I have no interest in it. I mention that because when I took this matter up with the minister in June, 1977, as is some people's wont, the first thing I saw was a story in the St. John's Evening Telegram. It was a statement by the manager of Newfoundland Steamships, the Clarke company in St. John's, one Elmer Edison, indicating that I have ulterior motives. He said that I never spoke before the Crosbies started their own service. Now, Mr. Speaker, I am an independent operator. 1 never spoke before because I was not a federal member before. Well, I am a federal member now, and I do not care if Chimo Shipping is owned by the Crosbies, the Smiths, the Langs, the Chretiens, or who owns it. If I think this is not in the public interest, I am going to bring it forward in this House.
No pip-squeak of a Clarke's manager in St. John's is going to frighten me by suggesting that I have some ulterior motive. I say this House is entitled to know what is happening with this subsidy to Clarke. The Chimo Shipping service is operating without a subsidy. The Harvey service is operating without a subsidy. Clarke is getting a subsidy which we know cost $3.6 million in 1976. Are we going to know how the rates are regulated? If there is going to be a continued subsidy of rates why are other companies not entitled to a subsidy? What value is the consumer getting through these rates?
Is Clarke going to get another contract for higher subsidy rates? How are we going to ensure that the consumer gets the benefit, and it is not just a benefit to Clarke? That is what we want to know. How are we going to be assured that it is going to reduce the cost of cargo moving into Newfoundland and moving out? I do not know what has happened with their application to get an increase in subsidies, or what will happen

with those services. It is time that there was some information given to this House and to the transport committee of it.
There is another matter I want to mention. I do not want to take too long here because this is our last day, I believe.


An hon. Member:: Oh, oh!


John Carnell Crosbie: We heard a great yelp of enthusiasm, a great screech and howl from the Liberal caucus this morning. When someone mentioned that there was going to be an election, they all howled no. They are like scared pups, Mr. Speaker. We are hoping the Prime Minister will go ahead anyway. So, this is our last stand in this parliament.


Maurice Adrian Dionne: Your last stand.


An hon. Member:: Order!


John Carnell Crosbie: One never knows with the electorate. They are very fickle, but I hope to be back, Mr. Speaker.
I happened to receive a letter. I am sure most members did. It was dated April 25, and it was from the Canadian Railways Employees' Pension Association. It brought up questions to do with their pension funds and whether the unfunded liability is going to be met in full. They seem to be quite concerned about it. Before concluding, I just want to point out that I brought that matter up before the Standing Committee on Finance, Trade and Economic Affairs, when we had the superintendent of insurance of the Department of Finance before us. I asked the superintendent if they also supervised pension funds, whether he was familiar with the CN pension fund, and whether he was satisfied with it. I am looking for the relevant page. At page 27:12 I asked Mr. Humphrys if he had any reason to be concerned about the soundness of the CN plan. He said:
No, Mr. Chairman, wc believe the plan is being managed and financed in accordance with the requirements of the Pension Benefits Standards Act and we believe adequate provision is being made to cover the liabilities.
Then I asked him, if I sent him a copy of the brief, would he look at it and give me his comments on it. He said that he would.
On May 5 I did write Mr. Humphrys and asked him to examine this submission from the Employees' Pension Association. I asked him to advise me whether, in his opinion, it is being managed and financed properly, and whether adequate provision had been made to cover liabilities; he had said that in committee. I have asked him to deal with the points and fears expressed in this brief from the railway pensioners. Certainly as members of this House we have to concern ourselves and make sure their concerns are needless, we hope, and therefore I have asked Mr. Humphrys to do that and he has said he would. He has already given the opinion that he does not think there is anything to be concerned about and that the liabilities to pensioners can be met.
I want the people who live in St. John's West who are railway pensioners to know that I share their concern, and I
May 10, 1978

am going to pursue this matter for them as they would expect me to do. I am sure other members take the same position in respect of pensioners of the CN with whom they are dealing.
I am going to come to a close because there are other speakers, and I think we want to conclude this today. I won't go into all the other points I could make on transportation in Newfoundland. We are concerned about a replacement for the William Carson which sank a year ago. It was very important to the ferry service of Newfoundland and she has not been replaced as yet.


An hon. Member:: Like the Frank Moore; that should be replaced.


John Carnell Crosbie: Mr. Speaker, I am talking about the William Carson, not the Broadbent, she has already floundered. I say replace the Carson with the Broadbent. That would be a good idea. He is going to need his bottom scraped before the election is over, Mr. Speaker. There has been no vessel ordered that we know of; the construction of no vessel has been ordered to replace the William Carson. There should be a vessel ordered from a Canadian shipyard, and it should be ordered now because of the time lag, and a vessel should be chartered in the meantime.
We are not satisfied with the ferry service to Argentia, nor are we satisfied with the ferry service generally from the mainland to Newfoundland. There are many complaints and I cannot go into them today, but it is not a satisfactory service for the travelling public. It has very badly affected the tourist trade. Tourists do not like to go through what they have to go through to get to Newfoundland and from it with their cars, when the tourist season comes. Because there are other speakers I will not go into anything else except to say this, Mr. Speaker. This is my last speech in the House, I feel sure-


Some hon. Members:: Hear, hear!


John Carnell Crosbie: Perhaps I could finish. This is my last speech in this House on this side. At the next session of the House I hope to speak from the benches opposite. It is my wish and hope that this House will be dissolved tomorrow and we can get on to the business of saving Canada from the hon. gentlemen opposite.


Cecil Morris Smith: Mr. Speaker, I rise to take part in the debate on third reading of Bill C-17 concerning the amortization of $808 million in CN debt. I support the amendment moved by the hon. member for Lisgar (Mr. Murta), that this bill be given a six-month hoist.
When speaking on second reading of Bill C-17 I expressed a number of the problems that concern people of the constituency of Churchill about the track running from The Pas to Churchill, some 509 miles, and from The Pas to Lynn Lake, another 170 miles. I am only going to deal with that one small segment of the mass problem of the CN. Of course it has the same problem just mentioned by the hon. member for St. John's West (Mr. Crosbie). This problem runs all the way from Cobbs Arm Island in Newfoundland to Pukatawagan in
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northern Manitoba; the same problem seems to exist everywhere.
The CN's obligation, as far as I am concerned, is to provide service to all areas of Canada. What we have seen over the past five years is service which has now reached the point of desperation in many parts of the Churchill constituency. In that constituency between The Pas and Churchill, the 509 miles of railway, we have observed communities such as Thicket Portage, Pikwitonei, Ilford, Gillam and Churchill without highway access, but with a service provided by the CNR faced with no competitive rates. As a result it has been ripping off the people of these communities. I want to get into that particular aspect a little later in my remarks.
We have just noticed very recently, now that passenger service has been turned over to VIA Rail, that excursion trains going to Churchill this summer will continue to have the same rates that applied last year. This is great for the people who are going to be travelling to Churchill on those excursion trains. We certainly welcome those tourists who come up to see that great sea port of Churchill which is now being underutilized because this government cannot seem to get its act in order, using that port to full capacity in respect of grain shipments.
While these excursion rates are to remain unchanged from last year, the Car-Go-Rail rates which have been in effect for some time will be discontinued. When we talk of Car-Go-Rail rates we refer to the main concern of the CNR being with the Toronto to Winnipeg run. That seems to be its major market area. What does this really mean to communities such as Gillam, Ilford, Pukatawagan, Pikwitonei and Thicket Portage where there is no off-rail transportation whatsoever? These communities must use the rail to transport their vehicles out to a highway system.
On April 29 the CN advised, and I have a copy of that letter, that the Car-Go-Rail rates and services which had been provided by the passenger division for the past number of years would be discontinued. Insofar as the major market areas such as Toronto to Winnipeg served by Car-Go-Rail in the past are concerned, CN will be announcing a new service called "transAuto". I do not know if this has anything to do with the minister because it is spelled "A-u-t-o", but that is probably the only way the minister could get his name into it. The letter suggests that transAuto will be substantially different from Car-Go-Rail in that it will be available as a whole sale service only to household moving companies, car rental companies, and similar organizations. Apparently private individuals wishing to move their vehicles between the points covered will have to go to one of these companies for retail service.
The letter goes on to state that CN recognizes it must continue to provide a retail service to residents of points in northern Manitoba not served by roads, and to meet this need it is publishing new freight rates to cover the movement of private passenger vehicles effective May 1, and I have a copy of this. Between Thompson and Gillam the rate is to be $87 per unit one way, and between Thompson and Churchill it is to
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be $128 per unit one way. Under the Car-Go-Rail system an individual taking his car out of Churchill or Gillam, and those are the two places referred to here, could buy a ticket, put his car on the train, ride with his car and have his car unloaded, and continue on his way. This really provided a much needed service to those communities that do not have access to highway transportation.
This letter goes on to state:
'
If a need develops for rates to and from other points not served by highway, they will be provided as required.
I would say that, instead of waiting for the rates to be provided as required, there are still the rates that must be worked out between Ilford and Thompson, Pikwitonei and Thompson, Thicket Portage and Thompson as well as from Pukatawagan to The Pas and Sherridon to The Pas. These people are also in the same situation. They cannot get their vehicles out unless they put them on the railway.
The letter ends up by saying:
Our personnel are being notified immediately of the availability of these rates after 1 May, and we will advise the media in the hope that they will inform the general public.
Well, Mr. Speaker, many of the communities in northern Manitoba do not have daily newspapers. They now have radio stations and television, but an announcement like this would probably not be carried over the particular television program that might be aired in northern Manitoba.
The letter from the CNR was dated April 12. On April 25 a letter was sent to the vice-president of the prairie region. This letter was from Mr. Banman, the minister of transportation in Manitoba. Mr. Banman in his letter pointed out his concern over the withdrawal of Car-Go-Rail service as a result of the transfer of rail passenger service to VIA Rail. Mr. Banman said in part:
I appreciate the fact that CN has introduced alternative arrangements to provide for the essential movement of vehicles between points in northern Manitoba not served by roads. However, we do have several concerns on this issue.
These are the same concerns that I raised in this House under Standing Order 43 as reported at page 5048 of Hansard.
Mr. Banman went on to say:
I note that the charge per vehicle effective May 1 has been set at $87 between Thompson and Gillam, and $128 between Thompson and Churchill. This represents increases of $27 and $59 per vehicle respectively over the charges currently applicable under the Car-Go-Rail plan. These increases appear to be rather excessive. Also, the absence of specific commodity rates to cover shipments between other points could result in the application of extremely high charges under class or express rate structures. There is also a requirement for maintaining rates between some northern communities served by road as a result of circuitous routes as well as long distances through desolate and isolated terrain.
In view of the foregoing, I would respectfully ask that Items 11650 and 11880 of tariff CNR W.l 150 be reinstated as soon as possible. In addition, as it will be some time before VIA absorbs local passenger services, I would also ask for your consideration in extending the Car-Go-Rail plan at least until such time the transfer is made.
What has happened here is that the CN in their expertise and before VIA Rail had actually taken over was going to implement these particular changes using the transAuto rates and the new rates set up by VIA Rail thereby doing away with the Car-Go-Rail system.
On May 3 Mr. Banman received a letter from the CNR prairie region manager, a copy of which I have here. It says:
I would like to acknowledge receipt of your letter of 25 April, concerning the withdrawal of Gar-Go-Rail services.
Due to some problems experienced in the establishment of our proposed transAuto service, Car-Go-Rail service on our main line routes has been extended to 31 May.
Because of my intervention and the intervention of the minister of transport from Manitoba, the CN is now saying that the rates will not be in effect on May 1, but will be extended to May 31.
He goes on to say:
It is anticipated that on 1 June VIA will assume full responsibility for rail passenger operations including those to northern Manitoba.
I would like to point out here that when people talk about a re-amortization of the CNR's $8.8 million debt, what they are really asking for is that the CN not forget that they have to provide a service. It is their mandate to provide service to areas that have no other means of transportation. I can assure you if there were other means of transportation out of those particular communities I probably would not get a single complaint because, after complaining for years about the poor service the CNR has supplied to those communities, the people have given up in total frustration.
The letter from the CNR goes on:
In response to your request that we extend the Car-Go-Rail plan until such time as the transfer is made, I have arranged for the freight rates on private passenger automobiles between Thompson, Gillam and Churchill to be reduced to the existing Car-Go-Rail level for the month of May, and enclose a copy of CNR Limited Freight Tariff W.4190 which publishes these rates. I should point out that these rates do not require the purchase of a passenger ticket, as was the case under Car-Go-Rail.
Regarding your comments on the rate levels that will take effect on 1 June, I would like to point out that the Car-Go-Rail charges were in effect for many years without increase and were, of course, an integral part of a rail passenger service package. These rates were very substantially below the costs of a freight operation.
I can appreciate that the Car-Go-Rail system was used right across Canada and that the major part of it was between Toronto and Winnipeg, but there are still the northern communities-and I am sure there are some in other provinces- that have no off-highway transportation. The people must use CNR to transport their vehicles when they go out on their annual leave. It is going to be a costly operation when these rates take effect.
As I specified before, the rate from Gillam to Thompson is going up $27, and the rate from Churchill to Thompson is going up $59. That places a real hardship on the people who want to take their families out for a vacation and who want to move their private vehicles. I am sure a lot of people who do travel out of these particular communities would be very happy to sit down with the officials and discuss this particular aspect because it certainly is a burden on them, and they have
[Mr. Smith (Churchill).)
May 10, 1978

no other means of transportation. The CNR is taking advantage of these people, and I would like to see a system set up where the cargo rail rate would still remain in place.
What irritates the people living in these isolated communities is that they must use this particular means of transporting their vehicles out, and yet VIA Rail or CNR says they are going to keep excursion rates for tourists coming into the north the same as last year, but they are going to increase the rate to move a private vehicle when you want to go out on holidays. VIA Rail has given absolutely no consideration to the people living in the north who have to use the facilities. They are the ones who have to bear the burden, but the tourists get the break.
To show the shortsightedness of the CNR, in the same letter in the last paragraph they gave an example to illustrate the number of vehicles that might be moved from any particular community. Of all places the example was Cranberry Portage and the number of vehicles transported from there to Lynn Lake. Everyone living up in that country knows that there is a road from Cranberry Portage to Lynn Lake and there is no need to move a vehicle by railway between those two communities. They say that they cannot justify running a service between Cranberry Portage and Lynn Lake for the simple reason there were only two vehicles moved in the year 1977. That just goes to show that people who live in communities with road access will not use that system. I am looking at the people who must use that system, and who have no other alternative.
Another colleague of mine wants to wrap up this debate. But I would just like to say that we have experienced exactly what the CNR is attempting to do by using the transAuto system to change the rates. We are moving private vehicles out of the north where people have no alternative. That is the same sort of thing the CNR tried to do by eliminating the station agents from those particular communities, Thicket Portage, Pikwitonei, Ilford, Gillam and Sherridon. The CNR arbitrarily made a decision they would move the station agents out of those particular communities. Believe me, Mr. Speaker, the people who live in those isolated communities must depend on the CNR for their freight, mail, express, groceries, and they were heard from. They went to the CNR and demanded that the railway come into those communities just so that the officials who make those decisions could actually see what happens in a small isolated community and how dependent they are on the railway, and how they give them no consideration whatsoever.
The railway cars would arrive with groceries and the railway employees would heave them out of the train. They would not even bother to set them off carefully. There were complaints of eggs and milk being spilled all over the platform. These were items needed by families. Those people in these communities were successful in getting the CNR to withdraw that decision to close those particular stations and remove the station agents. Once the communities made their representations the
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CNR saw just how essential those services were to the communities.
This is what I would like to see, and I would challenge those particular communities now. I will certainly give them my support to take the CNR to task and have those rates remain the same as they are now under the Car-Go-Rail system.


Mr. Gordon Ritchie (Dauphin):: Mr. Speaker, I promise that I will finish in good time to have the vote and to have our supper.
I might say that I am happy to speak on this amendment on final reading of Bill C-17. I would like to put on the record some of the fears and thoughts I have as a western Canadian, particularly in regard to the constituency which I represent which is served almost wholly by the Canadian National Railways.
In the last few years in the eastern prairies it would appear that the CNR has acted as if it wanted to abandon most of its railway lines and to give up the job of transporting goods and providing services for the rural communities. First of all we had the Servo centres which were brought in by order of the CTC. This was to phase out the station agents. Gradually these agents were phased out, but when they did that they also phased out the person who was the Canadian National's representative in the community to whom businessmen could turn to get their shipments of goods. These people vanished. In their place they put a Servo centre with a long distance connection to Winnipeg.
Unfortunately, they cannot even man the Servo centres all the time. Customers complain that when they would phone there was no answer. I have found out through railway management that there are so few people around that they cannot always man the telephones in the Servo centres. It happens that business that might belong to the CNR goes elsewhere. It is impossible for shippers to get much satisfaction from the Servo centre by telephone.
The CNR Express have gradually reduced their service. I understand from reading about the situation in Saskatchewan that CN Express have suddenly pulled out from there almost overnight. Shipment of small parcels by railway has all but vanished. This may well be by design, and it is perhaps the result of changing attitudes and changing circumstances. In my opinion, most of us feel that the railways want to reduce their traditional role of carrying heavy bulk cargoes such as grain, or at least to reduce the number of branch lines and to restrict the railways to a few major lines in western Canada running through the country so that grain handling will be carried on by large unit handling elevators located at relatively few points on the prairies. Certainly the dispute carried on now concerning the hours of work whereby the Minister of Labour (Mr. Munro) wants to declare the country elevator managers covered by the 48-hour week will go a long way to speed up the consolidation of the grain handling system.
The railways may well be expecting too much. Maybe farmers will be driven to use trucks, by changes in the railway system, and if farmers must haul their grain 100 miles or so, it
800 3 8-45 Vi

May 10, 1978
Railway Act
is not all that difficult to haul it considerably farther. Everyone has stated that for the western part of the country the railway is far superior to the highway for the hauling of grain. But in fact there are considerable doubts about this and the mere fact that the steel on steel requires much less energy than the rubber on tarmack is not the only factor in the movement of grain.
My observation is that this bill will hasten the relative reduction of importance of railways in the west with rises in the trucking industry, and particularly for individual farmers who will use their own trucks. Indeed, it has now become evident that individual farms of even a quite small size will have to own their own trucks in order to facilitate the movement of their goods throughout western Canada.
When one observes on the highway the various trucks hauling goods belonging to large chain stores such as Safeways or the Federated Cooperatives or implement companies, indeed it is becoming obvious that the necessity for moving goods in western Canada largely must be met by the companies' own trucks. Franchise trucking firms seem to have difficulty delivering goods as to time and price. It is particularly difficult for small firms, especially retail firms, to have their shipments made efficiently and at a reasonable cost. Indeed, it seems as if many small retail outlets on the prairies will have to pick up their own freight in the larger centres and transport it to their retail stores with their own trucks and vehicles.
The Canadian National Railways in this bill are obviously withdrawing from being a major factor in the transportation system of the west except for some trunk lines. There are a number of reasons for this, some of which are inherent and structural. Trucks can deliver goods cheaply and with a much better time schedule in certain ways.
But there are many other reasons why the CN Railways, at least in my area, are finding their role reduced. Railways are by nature monopolies. To have only the railway to ship is not an unmixed blessing. Trucking lends itself tc individuals, to small units of operation whereby the entrepreneurial spirit can certainly thrive much more than in the rigidity of a large organization such as the CNR. Wage structures are more variable and efficiencies are perhaps easier to come by.
In the matter of management the CNR has obviously one serious fault so far as western Canada is concerned. It is the fact that the management is concentrated in Montreal, and that the concentration in Quebec of management has a serious and detrimental effect on the efficiency of the railways in western Canada. Perhaps it is partly because of geographical, cultural, and linguistic difference. But to have the management so closely controlled in the city of Montreal where railways in the east must compete mostly with water, and when in fact the largest operation of railway activity is concentrated in western Canada, means that management is at a serious disadvantage in dealing with the prairies. Certainly the attitude of the president and management in Montreal, and their actions so far as they affect the west, indicate they have little concept of what is the actual fact there, otherwise they would be doing things differently.

I understand that in years gone by the western region was semi-autonomous and while the final authority rested in Montreal for practical purposes, in the day to day running of the rail line it rested fairly firmly in Winnipeg. There are great disadvantages to the present situation, in that it is much better to manage with on-the-spot knowledge compared to the alternative of a thousand miles away with people who are not familiar with the circumstances in western Canada.
Discussion with many railway employees, and particularly with middle and senior management, although they were reluctant to say much due to their fear of retaliation and jot discrimination, indicates that many railway employees in the west are suspicious and uncertain and, in fact, at times are openly resentful of the policies foisted on them by a management based in Montreal making decisions. There was at one time a considerable body of loyalty, trust, and pride in the work force, but this seems to have gone.
Resentment against management is rife, and indeed many railway workers are looking for means only of finishing out their careers and obtaining other security before moving. Employee morale has probably never been lower. Many of the decisions made affecting the running of the railways make little sense. Sometimes these decisions appear only to be made for the sake of doing something. In any case, railways are greatly cutting themselves off from the communities they serve.
In this legislation, the railway is in fact being forgiven a debt of $800 million. It will make its financial appearance considerably better and it would seem to have a much better chance of overruling its main competition, the Canadian Pacific Railway on one hand and, on the other hand, moving into the trucking field in order to squeeze out independents and the myriad of small trucking concerns across this land.
We hear much of corporate power from the boardrooms. There is nc more dangerous concentration of corporate power than in the boardrooms of the large Crown corporations. Aii Canada is assiduously trying, through eyery means possible., tc wipe out its competitors. CNR management seem intent on wiping out their competitors and also a substantial portion of the trucking industry.
These are some of the main fears that I have about this bill. Does the CNR intend to reduce its railroading in the west? Does it intend to reduce its services to farmers in the grain handling industry which, after all, is the main reason for railroads in the west? Does it intend to move into the trucking field and establish a trucking monopoiy in that field and then attempt to have restrictive legislation passed so that the commercial life in the trucking field will be dominated by one large Crown corporation?
The movement of the CNR into the field for trucking means that it is attempting to get rid of one of its major competitors. In the riding I represent, the CNR Las bought out or.e of the more profitable truck lines, the Swan River-The Pas Transfer. This gives a partial monopoly on freight transportation to the
May 10, 1978

CNR and it is an object of some concern to many in the area. Transportation is certainly an area where it is difficult to have competition, but I think it is essentially wrong that the railway can smother its competition by buying out a trucking firm. Certainly it can afford to pay any price to obtain that trucking firm. There are no constraints so far as expenditures are concerned because, in the final analysis, the CNR has the backing of the treasury behind it.
Wherever possible we should preserve as many companies in the field as practical. That is why I certainly am concerned about the excursions of the CNR, taking over trucking firms and establishing what is a virtual monopoly in some areas. This has already occurred in the area I represent. It has not had a good response.
This bill allows CN to get out of railway passenger service, giving it to VIA Rail. We do know of course that rail passenger services in Canada as in all western countries, with the advent of the automobile have been much less popular, and have been a losing proposition so far as money is concerned. But all this bill does with the formation of VIA Rail is to transfer the deficit of rail passenger service on to VIA Rail. There is no evidence whatsoever that VIA Rail will be any more viable than under the present rail structure. As VIA Rail will still be using trains and passenger cars, the government will still have to meet VIA Rail's deficit.
One of the advantages of Bill C-17 is that it will eliminate the necessity of the federal treasury meeting the deficits of the CNR that rise from time to time. But the government can still guarantee CNR's loans from the private market. Like the Export Development Corporation's loans, all this does is that it allows the government to go on the note at the bank as a co-signer without the items actually appearing as a debit on the government's ledger. This is a deception of the worst order. Actually, borrowings that must be guaranteed by the federal treasury, either by the Export Development Corporation, the CNR, or other Crown corporations, should so appear on the ledger of the government.
I would like to speak briefly on the Churchill export movement and the necessity of the railways to upgrade the Churchill line to carry more grain. It represents Manitoba's alternate card that it can play, as well as other parts of the prairies, in attempting to get a better deal from eastern grain handling companies and installations. Depending on the circumstances, grain shipped through Thunder Bay averages about 25 cents a bushel less than shipped through the west coast. That is, it costs that much more.
Through a rather ingenious method of redistribution, shippers on the western half of the prairies pay some of this extra money received to shippers in the eastern half of the prairies. I think it is fair to say that the relative importance of western movements of grain will increase while the eastern movement through Thunder Bay will decrease in the foreseeable future. Indeed, if the laws of the markets prevail and if the true shipping costs were reflected, a much larger proportion of grain would go out through west coast ports and the dividing line would be considerably east of what it is now. But tradi-
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tion, the earlier development of the Thunder Bay route and greater structures to handle grain on this traditional route have caused a reduced volume of west coast shipping that might have been expected to have happened. To the northeastern prairies and parkland regions of Manitoba and Saskatchewan, Churchill offers an alternative to prevent exorbitant tariff charges by eastern interests, and we have an example of this with the rise in tolls in the St. Lawrence Seaway. While the rise of tolls may be justified, still it has seriously compromised the income of western farmers.
Churchill lies on the ocean and, with a grain haul of 500 odd miles, it is as close as Thunder Bay is to the prairie grain region. It has been artificially constrained by government action and by port interests in Montreal and other eastern ports. This is a political fact of life and it is time that these constraints were removed. Greater use should be made of Churchill and, while it may have certain disadvantages, it has certain inherently great advantages. One is that with the weather being cold, grain can be stored indefinitely.
In conclusion, the port of Churchill is a logical grain shipping point for the future. A highway will eventually be built into Churchill. It will provide much of western Canada with an ocean port of a distance less than 500 miles away. If the CNR does not want to haul grain into Churchill, the trucks will.


The Acting Speaker (Mr. Turner):: Is the House ready for the question?


Some hon. Members:: Question.


The Acting Speaker (Mr. Turner):: The question is on the amendment of the hon. member for Lisgar (Mr. Murta). Is it the pleasure of the House to adopt the said amendment?


Some hon. Members:: Agreed.


Some hon. Members:: No.


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


Some hon. Members:: Yea.


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


Some hon. Members:: Nay.


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


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


Mr. Speaker:: I therefore declare the amendment lost.
The question is on the main motion that the bill be now read the third time. Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.
[The Acting Speaker (Mr. Turner).]


Mr. Speaker:: Those in favour of the motion will please say yea.


Some hon. Members:: Yea.


Mr. Speaker:: Those opposed will please say nay.


Some hon. Members:: Nay.


Mr. Speaker:: In my opinion the yeas have it.
And more than five members having risen;


Mr. Speaker:: Is it agreed that the same recorded division be taken as was conducted in the last case without further ringing of the bells?


Some hon. Members:: Agreed.


Mr. Speaker:: I therefore declare the motion carried.
Bill read the third time and passed.


Mr. Speaker:: Order, please. It being after six o'clock, this House stands adjourned until tomorrow at 2 p.m.
At 6.27 p.m. the House adjourned, without question put, pursuant to Standing Order.

Thursday, May 11, 1978