1978-04-27

ROUTINE PROCEEDINGS


Hon. George Hees (Prince Edward-Hastings):: Mr. Speaker, I rise under the provisions of Standing Order 43 to move a motion on a matter of urgent and pressing necessity. As the rate of unemployment for men and women under 25 years of age is twice the rate of those 25 years and older, so that our young people are bearing twice the burden of the worst unemployment since the great depression of the 1930s, I move, seconded by the hon. member for Lanark-Renfrew-Carleton (Mr. Dick):
That the government announce a program of incentives which will make it possible for businessmen and farmers to employ our young people, and thus enable them to take their rightful place in the work force, instead of enduring the unemployment and disillusionment which the economic policies of the present federal government have forced upon them.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


VETERANS AFFAIRS
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, there is a double sense of urgency about the matter which I wish to present to the House under Standing Order 43. First, since this House is still here it is urgent that we do something useful and important. Second, in view of the fact that an election might be called, it is urgent that we deal with this matter quickly. I believe the House would do so. I therefore move, seconded by the hon. member for Timiskaming (Mr. Peters):
That this House calls on the Prime Minister to give approval to the immediate introduction by the Minister of Veterans Affairs of a bill to provide prorata
pensions for widows of veterans where the veteran's disability pension was below 48 per cent and to restore the basic rate of the war disability pension to the level calculated on the basis of the formula agreed to in 1973.


Mr. Speaker:: In accordance with the provisions of Standing Order 43, such a motion can be presented for discussion only with the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


AGRICULTURE
Mr. Jack Murta (Lisgar):: Mr. Speaker, I rise under Standing Order 43 on a matter of urgent and pressing necessity, that being the statement of the Minister of Agriculture (Mr. Whelan) yesterday that he is perfectly willing to look at any evidence the hon. member, meaning myself, may have in relation to the question of agricultural chemicals.
Given this fact, and because the minister's letter to me dated April 13, 1978, admits that in the case of two chemicals quoted in his letter-those being Eptam and Eradicane-there is a substantial difference in price between Canadian and United States figures and the difference in price, using the minister's own calculations, is 65 per cent and 70 per cent respectively, I move, seconded by the hon. member for Pro-vencher (Mr. Epp):
That the minister immediately issue special import permits to allow chemicals designated by the Department of Agriculture to enter Canada without restriction.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


NORTHERN AFFAIRS
Mr. Cecil Smith (Churchill):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and

April 27, 1978
Oral Questions
pressing necessity. The northern flood agreement was ratified on March 16, 1978. The previous minister of Indian affairs and northern development made a firm commitment in August, 1977, at Winnipeg before witnesses that the Northern Flood Committee would be funded for some time. After ratification, funding was terminated on March 31, 1978. The flood committee's job has not been completed. Therefore, I move, seconded by the hon. member for Portage (Mr. Masniuk):
That the Minister of Indian Affairs and Northern Development take immediate steps to provide funding to the Northern Flood Committee until such time as the development corporation is established.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


YOUNG CANADA WORKS
Mr. Andy Hogan (Cape Breton-East Richmond):: Mr. Speaker, in view of the fact that Young Canada Works funding has been cut nationally this year, to the great detriment of students from low income areas, and since this is a pressing and urgent matter, I would move, seconded by the hon. member for Brant (Mr. Blackburn):
That the federal government extend emergency grants to such students for the purpose of allowing them equal opportunity for higher education.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, as we know, not only are prices rising in Canada to an extent far beyond what was anticipated, and certainly beyond what was expected by the government, and we understand now through merchandising organizations that still higher prices may be anticipated, for example for wood products and animal pro-

ducts-one store indicates there is likely to be an increase of as much as 50 cents a pound in the price of certain cuts of beef alone-


Some hon. Members:: Question.


Sinclair McKnight Stevens: -would the Minister of Finance tell us, when he adopted what he calls his new monetary policy of "a floating dollar is a floating dollar," did he fully consider the inflationary consequence of a falling dollar upon this country and, if so, did he anticipate the price rises which are now being felt and which will likely be felt between now and June?


Hon. Jean Chretien (Minister of Finance):: I dealt with this problem in my budget speech. I said that because the Canadian dollar has been devalued, some cuts could be expected and I revised my inflation forecast of last fall from 6 per cent to 7 per cent. I maintain that figure which I put in my budget speech.


Sinclair McKnight Stevens: Not only has the government caused the value of the dollar to fall, resulting in the inflation to which the minister now admits-


Some hon. Members:: Question.


Sinclair McKnight Stevens: -but the government has also caused the Bank of Canada to buy $2.2 billion of the federal debt, 30 per cent of the total financial requirement in the fiscal year just ended, as has been revealed in the Standing Committee on Finance, Trade and Economic Affairs. Would the minister also tell us whether he anticipated the inflationary impact of that type of monetarization of debt and, if so, when does he intend to ask the governor of the Bank of Canada to be less inflationary in his monetary stance?


Joseph Jacques Jean Chrétien: The governor stated some months ago that the range of increase in the monetary supply was to be between 7 per cent and 11 per cent, and he has adhered to that policy. I might point out that some critics say it is too strict a monetary policy.


Sinclair McKnight Stevens: Realizing that the government, through the falling dollar, through its habit of having the Bank of Canada monetarize debt by printing more money is simply putting in place future inflation, would the minister tell us whether he has specifically asked the Anti-Inflation Board to assess the impact, first, of the Bank of Canada's monetary policy and, second, of the fall in the value of the dollar-some 16 per cent-to its present level?


Joseph Jacques Jean Chrétien: We have analysed all these factors and made a forecast for this year that the annual rate of inflation will be 7 per cent and that the growth in the gross national product will be close to 5 per cent. The hon. member forgot to mention to the House that in the last ten days the Canadian dollar has gained two points.


Sinclair McKnight Stevens: It is down today.

April 27, 1978


RATE OF INFLATION
Mr. Bill Clarke (Vancouver Quadra):: Mr. Speaker, I would like to ask the Minister of Finance how he can predict an inflation rate of 7 per cent when the Statistics Canada general wholesale index shows the February over January percentage change to be 1.2 per cent for just one of the 12 months of the year.


Joseph Jacques Jean Chrétien: Mr. Speaker, when these statistics were published I stated that certain increases had occurred in March as a result of higher oil prices but that we had forecast a larger increase for March than for February. We have not changed our predictions for the full year because we had already predicted that we would have a problem in March.


William Hillary (Bill) Clarke: Would the minister now reconsider reducing the rate of expansion being practised by the Bank of Canada?


Joseph Jacques Jean Chrétien: Mr. Speaker, the expansion rate of the money supply fluctuates between 7 and 11 per cent. It has been considerably reduced during the past two years. I think that rate can accommodate 5 per cent of the economic growth in addition to the inflation we have predicted.

[English)


PIPELINES
Mr. Stuart Leggatt (New Westminster):: Mr. Speaker, my question is directed to the Deputy Prime Minister in his capacity as minister responsible for the Alaska Highway pipeline. Can the Deputy Prime Minister advise whether he has been officially approached by the government of British Columbia with respect to the extention of the rail line from Fort Nelson?
I understand that the Premier of British Columbia announced that he would have a decision within six weeks and that he had made an official request for federal government assistance to continue the operation and development of this northern rail line. Would the Deputy Prime Minister advise whether such a request has been made and, if a request has been made, would he advise us of the amount requested of the federal government?


Hon. Allan J. MacEachen (Deputy Prime Minister and President of Privy Council):: Mr. Speaker, I had a meeting on Friday last with two members of the government of British Columbia, the purpose of which was to discuss the elements of an agreement which might be entered into between the Gov-
Ora/ Questions
ernment of Canada and the government of British Columbia in connection with the enforcement of the non-discriminatory features of the pipeline agreement.
A number of proposals were made by the members of the government of British Columbia. We intend to have further meetings. It is not my intention-at least without direct consultation with the government of British Columbia-to disclose the contents of their proposals at this stage.


Stuart Malcolm Leggatt: Mr. Speaker, with regard to the decision in the original Alaska Highway treaty, was there any request by the government of British Columbia, when the federal government was negotiating with the United States regarding the B.C. section of the Alaska Highway pipeline, for some form of transportation assistance to the province of British Columbia prior to the signing of the Final treaty? Was there any request made by the province of British Columbia for that purpose?


Allan Joseph MacEachen: Mr. Speaker, before we entered into the agreement with the United States we had discussions with the government of British Columbia. If my hon. friend will look at the agreement, he will find that there are addenda there relating to the commitments undertaken by the various provincial governments with respect to the principle of non-discrimination. The condition, or the qualification entered by the government of British Columbia had to do with how, as I recollect it, its proposals were subsequently to be dealt with.
So it is a fact that prior to the agreement, the government of British Columbia did make known to us in a general way, as I recall, its views on what agreement ought to be entered into with Canada.


Stuart Malcolm Leggatt: Mr. Speaker, can the Deputy Prime Minister at this point advise the House whether there will be some form of assistance forthcoming with regard to this very serious problem in northern British Columbia? Will there be some assistance, perhaps less than that requested? Can the minister at least give us a commitment that there will be federal help for that rail line, in view of the fact that it is going to be carrying pipe up to that pipeline and will form a very key and necessary part of the construction? Is there some feeling of federal responsibility in this regard now?


Allan Joseph MacEachen: If any transportation system is required by the pipeline in order to undertake the project, then of course it is possible to consider charging the pipeline company directly for that type of requirement. But it has to be an installation that is required by the company in order to build the pipeline, and would thereby be a direct charge on the pipeline and eventually included in the cost of the service to the consumers. But one would have to look at each particular expenditure on transportation in relation to the logistical plan of the company to know whether it could constitute a direct charge.
4914

April 27, 1978
Oral Questions


ALASKA HIGHWAY PIPELINE-LIABILITY FOR COST OF INFRASTRUCTURE
Mr. F. Oberle (Prince George-Peace River):: I have a brief supplementary question for the minister. It concerns the proposals advanced by British Columbia to the federal government regarding a joint approach to the creation of the necessary infrastructure in the area of transportation, communications and community services.
Can the minister advise the House whether he perceives the pipeline agreement with the United States to be flexible enough to incorporate or to charge the cost for some of these infrastructures which are obviously required at this late date to the pipeline company or to the end users of the product flowing through the pipeline?


Allan Joseph MacEachen: Mr. Speaker, I would have to repeat part of the answer already given, that in each case there are obviously certain installations or a certain infrastructure which will be required by the pipeline company, and in that case it would be chargeable to the pipeline company.
I believe what was contemplated in the question put earlier was federal assistance to British Columbia in order to undertake certain projects which might not be directly related to the requirements of the pipeline company. In cases of that kind, of course, it would not be possible to have these expenditures charged directly to the pipeline company.


UNEMPLOYMENT INSURANCE
Mr. Gilles Caouette (T6miscamingue):: Mr. Speaker, I should like to put a question to the Minister of Employment and Immigration.
Following abundant correspondence on the installation of a model SRI mini-computer to improve the processing of applications for unemployment insurance and reduce delays- it now takes as long as two months to study some applications-the minister indicated to me that the decision to supply northwest Quebec with such a mini-computer depends on the merging of the unemployment insurance office with the manpower centre. In addition, he indicated that he must first assess the results of the test area of Hull before reaching a decision. Can he tell the House today whether, after two years of study, he has come to a conclusion with regard to the test project in Hull? If not, when does he expect that study to be completed?


Hon. Bud Cullen (Minister of Employment and Immigration):: Mr. Speaker, no one can deny that additional computers would help to expedite the claims that are filed at the present

time. I think we have a splendid record in that respect. Sometimes errors are made by the applicant, and sometimes they are made by our departmental officials. I would like to see the kind of thing the hon. member is recommending used in other regions of the country. It is a case of setting priorities, seeing the extent to which they can be used and the amount of money available to give that kind of service.


Mr. Caouette (T£miscamingue):: Mr. Speaker, since the minister indicated in his written replies that it was a question of merging the unemployment insurance office with the manpower centre, can he tell the House whether that agreement has been reached in northwest Quebec and when the two offices will be combined?


Jack Sydney George (Bud) Cullen: Mr. Speaker, in the interests of the personnel who work in the various offices, we want to proceed carefully and cautiously so as not to upset the personnel we have there. We want their morale to remain high. We also want to put offices where they will be most effective. There is a whole series of questions of this nature to be determined before we determine where the mini-computers should be placed.


Gilles Caouette: Mr. Speaker, the minister indicated it was a question of budget and that the regional office for the province of Quebec, that is the Montreal office, is willing to cede to northwest Quebec that part of the budget now allotted to it. Those additional funds would enable northwest Quebec to have a mini-computer. Is the minister willing to make a decision immediately seeing the funds have been allotted and can be transferred?


Jack Sydney George (Bud) Cullen: Mr. Speaker, I do not know that the decision would be made immediately, but I can assure the hon. member that we are doing everything we can to bring first-class service to the people in that particular region.


NATIONAL SECURITY
Mr. Bill Jarvis (Perth-Wilmot):: Mr. Speaker, my question is directed to the Solicitor General: it relates to the two years of missing documents covering the period when the present Minister of Supply and Services was solicitor general. At various times yesterday the Solicitor General indicated that documents were destroyed, later he qualified that by saying they were presumably destroyed, and even later he said there was no certificate of destruction and, therefore, a great deal of uncertainty. Has the Solicitor General determined whether, in

fact, the documents were destroyed, when they were destroyed, and under whose authority?


Hon.   J.-J. Blais@Solicitor General: Mr. Speaker, the documents are presumed to have been destroyed. There is no precise date indicated as to the time of destruction.


William Herbert Jarvis: Mr. Speaker, therefore, I presume no certificate of destruction has been found. Yesterday the Solicitor General indicated that this was a matter of routine procedure-which in itself is alarming enough-wherein documents may be destroyed after a three-year period.
Can the Solicitor General explain, under these routine procedures, why documents would be destroyed for these very vital two years, yet documents for 1973, 1974 and part of 1975-which are now three years old-are so readily available to the McDonald commission?


Mr. Blais:: Mr. Speaker, as I indicated to the hon. gentleman, the source documents referred to in the reports are still available and, indeed, are available to the McDonald commission. In terms of the procedures which were followed, yes, they were internal procedures. There were directives issued relating to this type of report, that the destruction ought to take place three years next after the date of the document. The three years have expired. I understand the directives were fairly explicit.
With reference to the documents after 1973, the documents are available because, indeed, the question of the McDonald commission came up within the time; otherwise their destruction might have been ordered.


William Herbert Jarvis: Mr. Speaker, yesterday the Solicitor General indicated-and I believe he has implied it today-that the McDonald commission would not be at all hindered by lack of availability of these documents, in that supporting documentary material is apparently still available. Assistant commissioner Venner said that the records show the government was fully informed as to electronic surveillance by means of these monthly reports.
For this crucial two-year period wherein those missing documents would have shown the degree of ministerial knowledge by the then solicitor general, is the present Solicitor General now telling us that supporting material is still available to the McDonald commission to enable that commission to know the degree of ministerial knowledge during that crucial two-year period?


Jean-Jacques Blais: Mr. Speaker, we are dealing here with a document or report referring to the criminal side, or the criminal investigation side. We are not dealing with material relating to the security service side. Therefore, when we are dealing with the reports, the information contained therein which is presently available to the McDonald commission is satisfactory for all the commission's needs.
Oral Questions


MEANING OF &quot;GOVERNMENT REQUIREMENTS&quot; IN RCMP INSTRUCTIONS
Hon. Robert L. Stanfield (Halifax):: Mr. Speaker, my question is directed to the Solicitor General. With respect to the apparent instructions issued by the Royal Canadian Mounted Police in 1971, about which I questioned the minister yesterday without much success, can the minister tell me what was meant in the instructions which indicated that the request for reporting was not so much for security reasons as it was for statistical purposes, including "government requirements"? Since this could not possibly have anything to do with security, can the minister indicate what was meant by "government requirements" in those instructions?


Hon.   J.-J. Blais@Solicitor General: Mr. Speaker, with reference to yesterday's questions, the hon. gentleman will recall that I did not want to comment specifically on the document that was referred to. The method which is employed in terms of collecting certain information follows the collection of statistical information that is generally available relating to all candidates in any given election. That information is then compared to files that are within the security service relating to their own responsibilities and discharging those responsibilities relating to national security, in the terms that I described yesterday. As I understand it, that is the significance of the terms that the hon. gentleman has advanced.


Robert Lorne Stanfield: Mr. Speaker, with all due respect, it is a little difficult to accept the explanation if this is what is meant by "government requirements". Some months ago the Prime Minister indicated that following the invocation of the War Measures Act the government requested the security forces to increase their interest in what he referred to as internal subversion, but the Prime Minister has never met my request to tell us precisely what the government's instructions were.
Could there be any connection between the instructions given to the RCM Police by the Prime Minister and members of the government following the October crisis and the reference to "government requirements" in the instructions issued in 1971 by the RCM Police?


Jean-Jacques Blais: Mr. Speaker, the hon. gentleman addressed himself yesterday to the question of directives that might have been issued by the Prime Minister relating to the question of surveillance of organized parties. The hon. gentleman was informed by me that, indeed, in 1975 specific instructions were issued relating to surveillance of political parties, and those instructions were that the surveillance ought not to take place.
With reference to the hon. gentleman's question, the Prime Minister was asked a question of similar nature some time in the past and made a very fulsome response to it.
80038-21'/2

April 27, 1978
Oral Questions


INSTRUCTIONS GIVEN TO RCMP FOLLOWING INVOKING OF WAR MEASURES ACT
Robert Lorne Stanfield: Mr. Speaker, since the Solicitor General will not, or cannot, answer my question, I ask the Prime Minister whether he is now prepared to tell the House quite frankly, either by tabling or by some other method, precisely what instructions were given to the RCMP following the invocation of the War Measures Act to which reference was made in the House some time ago by the Prime Minister.
Will the Prime Minister now give the House this information, so as to remove the suspicion that in fact the instructions issued by the RCM Police were, at least partially, the result of instructions given to the RCM Police by the Prime Minister and by the government?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, on the latter part of the question, I would have to find out when the RCMP gave the instructions that the hon. member is talking about. My impression is that they have existed for a long period of time and that they did not begin around 1970 or 1971. But I could ascertain the exact date if, indeed, I can get it exactly from the RCMP. I can get a general answer.
In so far as the first part of the question is concerned, I repeat in the House now as clearly as I did the last time, that this instruction was given by the government, notably at meetings of the cabinet committee on security and intelligence when we were somewhat distressed that after the events of October, 1970, the police did not have more files on people who had been involved in bombings, kidnappings, killings, raiding of arsenals, and so on. We asked them to increase their security operations also in the area of internal subversion and not to concentrate, as appeared to be the case, mainly on external security. This was the general nature of the instructions. The police then abided by these instructions to the best of their ability.


REQUEST FOR TABLING OF INSTRUCTIONS TO RCMP
Mr. Joe Clark (Leader of the Opposition):: Mr. Speaker, the Prime Minister has indicated the general nature of those instructions. Would he now undertake to the House of Commons to table those instructions in their entirety?


Pierre Elliott Trudeau: Mr. Speaker, I repeat, the instructions were given at a cabinet committee on security and intelligence, and probably in the course of discussions among myself, other ministers and the commissioner of the RCMP. There are no instructions to table: I talked to the commissioner as I talk to the House now, as I think any reasonable member on the other side would say.
We were worried that there could have been activity by the FLQ over a period of years, and when it culminates in kidnappings and even the murder of a minister- "You do not seem to have many files on these people." You become concerned and ask that the security forces make sure they investigate this side more thoroughly and not only look at external

subversion. There is nothing to table. I talked in those words, or words like them, and I make that quite clear before the House.


Charles Joseph Clark: Mr. Speaker, the Prime Minister will understand that most of us would assume there would be some record kept, either in the form of minutes, notations made internally by security officers to whom the instructions were given, or in the form of an aide memoire that the Prime Minister might have prepared for himself.
Will he give us an undertaking now that he will have a very thorough search made for any record of any of these instructions, and that all such records will be tabled in the House of Commons?


Pierre Elliott Trudeau: Mr. Speaker, the Leader of the Opposition knows that a record is kept of cabinet committee discussions. Therefore, in the sense that what I have told the House now was told by me to the ministers and the members of the RCMP, there is probably a record of that. It is called either a record of decision, or minutes of a cabinet meeting. Certainly, it is not the intention of the government to table minutes of cabinet discussions. I am surprised that the Leader of the Opposition would suggest that the secrecy of cabinet be unveiled in order that the Canadian public and the opposition know the discussion which goes on in cabinet. That is completely contrary to the cabinet system of cabinet solidarity.


Charles Joseph Clark: We have had a number of events, Mr. Speaker, come to light in the last couple of days that are completely contrary to the formal practices of the parliamentary system.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: These have raised very real concerns about the extent of ministerial direction to the security service and the degree to which there was ministerial or prime ministerial involvement in some of the activities that are now of concern to the House and the country.
In light of the fact that already there have been unusual events, I wonder if the Prime Minister would give the most serious consideration to-admittedly, it is an unusual action- making available a partial list. In other words, would he make available to the House of Commons and the people of Canada, to end all this mystery, those portions of cabinet minutes and, I emphasize, any other documents which might relate to instructions given by the Prime Minister, or people acting on his behalf, to security officials?


Pierre Elliott Trudeau: Mr. Speaker, the Leader of the Opposition prefaced his question by talking about unparliamentary practices. It seems to me one of them is that suggested by his side, that they will fire all the deputy ministers if ever they form a government.
If the Leader of the Opposition will reflect on the nature of cabinet government-


Robert Lorne Stanfield: You must be in trouble.
April 27, 1978


Pierre Elliott Trudeau: -he will realize that for the purpose of arriving at a cabinet decision it is necessary for ministers to have discussions among themselves freely, and not have those discussions recorded publicly. It is obvious why I will not, and should not, table the discussion or the minutes of discussion in cabinet, and the Leader of the Opposition should know enough about the cabinet system to understand that.


Mr. Hnatyshyn:: We will.


NATIONAL DEFENCE
Mr. Roch La Salle (Joliette):: Mr. Speaker, my question is directed to the right hon. Prime Minister.
Considering that the government is about to award one of the biggest contracts in the history of shipbuilding and that this program would apparently secure 4,500 jobs, and given the unemployment situation in the towns or cities I have in mind, namely Sorel, Montreal, Lauzon and other localities in Canada, in the circumstances could the Prime Minister make a commitment or be prepared to ask the people who are responsible for this contract to make the related studies in the shortest time possible, precisely to enable the builders to draw the benefits of this contract which is apparently rather fantastic?


Pierre Elliott Trudeau: Mr. Speaker, I understand the interest of the hon. member in such a subject but if he has followed the policy of the government and the announcements which were published when talking about building ships for the Canadian navy under the responsibility of the Department of National Defence, he will certainly remember that we mentioned one ship to be launched during the year 1984 or 1985. Thus I do not think this question is realistic. Before building these ships we obviously need very detailed and very complicated plans. These plans must then be presented to the bidders. There are several stages to go through. So I think it is not realistic to suggest that these dates be set earlier so as to meet the hon. member's request.


Roch La Salle: Mr. Speaker, my question is simple. I am trying to reassure the persons involved and of course the population of Canada. Could the Prime Minister ask that these studies be completed as soon as possible? I do not ask to lessen the importance of these studies, but considering the unemployment situation in Canada today, I simply ask the government to act more quickly in this regard than it has done over the last ten years.
Oral Questions


ADMINISTRATION OF JUSTICE
Ramon John Hnatyshyn: Mr. Speaker, in the absence of the Minister of Justice I would address my question to the Prime Minister. It has been announced that the Minister of Supply and Services is going to launch an appeal with respect to the $10,000 in damages awarded by Mr. Justice Lieff for the libelling of Mr. Larry Stopforth.
In view of the fact that the Minister of Supply and Services has the full resources of the government behind him with respect to legal costs, in the interests of equity will the Prime Minister recommend to the Minister of Justice that Mr. Stopforth's legal costs be paid by the government so that he will not be facing very large costs for what could be a series of appeals from this point forward?


Pierre Elliott Trudeau: Mr. Speaker, in the area of criminal law, where the federal goverment has jurisdiction, we have proposals and procedures for assisting people who are victims of crimes, and so on, and who incur damages in the way of costs. But in the area of civil law, or common law, which is not within our jurisdiction, we do not have these procedures.
I understand the common law and civil law provinces do have measures of assisting litigants who are in need of assistance. But certainly, as a matter of general practice, I do not think the hon. member would suggest that every time the government is sued by somebody, or a minister or official of the government is sued, the government should pay the expenses of the suer.


An hon. Member:: The "suer"?


Some hon. Members:: Oh, oh!


Ramon John Hnatyshyn: Mr. Speaker, I would suggest to the Prime Minister that the Minister of Supply and Services had better be-


Some hon. Members:: Oh, oh!


Ramon John Hnatyshyn: I will wait until the government side quietens down.


Some hon. Members:: Oh, oh!


Ramon John Hnatyshyn: I would suggest that the Minister of Supply and Services had better be successful because a Conservative president of the treasury board will look very hard at any payment of damages. I ask the Prime Minister whether, in view of the very interesting precedents given by the Minister of Justice, the government has paid the legal costs of the former minister of transport, Senator Marchand, who was sued by the Crown attorney in Ottawa for saying that the Crown attorney had double-crossed him. Also, is there an undertaking from the former minister of finance, Mr. John Turner, who sued the

April 27, 1978
Oral Questions
CBC, that any moneys received from that libel action would be turned over to the public treasury?


Pierre Elliott Trudeau: Mr. Speaker, it seems to me the hon. member is trying to make a debating point. If he is discussing the matter seriously as a matter of law, I hope he will restate his question.


Ramon John Hnatyshyn: I will be glad to. I thought you were a professor of law.


PENSIONS
Stanley Howard Knowles: Mr. Speaker, my question is for the Minister of Finance. I put my question to him because the Department of Insurance and the Pension Benefits Standards Act come under his jurisdiction.
In view of the fact that a couple of days ago the United States Supreme Court ruled that in that country employers must no longer require women to make larger payments to retirement funds than men simply because females have a longer average lifespan, and in view of the fact that there are provisions in the Canadian Human Rights Act which prohibit discrimination between men and women in matters of pension plans, may I ask the Minister of Finance if he will take steps to have this matter studied to make sure that pension plans in this country, not just those which come under jurisdiction of governments but those that come under private auspices as well, are set up so that there is no discrimination, bearing in mind that this should include the elimination of actuarial tables which set up differences in rates between men and women?
[ Translation]


Joseph Jacques Jean Chrétien: Mr. Speaker, the hon. member raises a very interesting question, and I will ask the superintendent of insurance to inquire and report to me. I will then communicate with the hon. member to inform him of the situation as its stands in Canada.


Stanley Howard Knowles: Mr. Speaker, my supplementary question is put to the minister so that I can ask if he will have that inquiry directed not only to pension plans but to insurance policies generally, so that there is no discrimination, particularly in the matter of rates being based on differences in longevity between men and women.


Joseph Jacques Jean Chrétien: Mr. Speaker, certainly I will be asking the superintendent of insurance to look at all aspects of the question.


NATIONAL DEFENCE
Mr. Maurice A. Dionne (Northumberland-Miramichi):: Mr. Speaker, I have a question for the Minister of National Defence. Can the minister advise the House if the Canadian armed forces were involved in the initial search for the Korean Airlines' plane which was forced down in the Soviet Union? If so, what was the extent of that search?


Hon. Barney Danson (Minister of National Defence):: Mr. Speaker, when the airplane was first noticed overdue, although it was not close to our coastline, as was further indicated, the Canadian armed forces major air disaster plan was put into place immediately. Aircraft were in the air with para-rescue teams on the search path when it was learned that the plane had gone down elsewhere. That the whole system was in being I found comforting, as minister, and I am sure the people of Canada do as well. This capacity works in a highly efficient way. It was put into operation automatically and I was kept informed during every stage of the operation.
While I am on my feet, Mr. Speaker-


Some hon. Members:: Oh, oh!


Barnett Jerome Danson: -I would like to draw the attention of the House to the presence in the gallery of Master Cadet Peter Dillon, the most qualified cadet in the cadet corps.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Qualified cadets make up for the minister!


GATT-CANADIAN POSITION VIS-A-VIS U.S. PROPOSAL FOR LOWER TARIFFS
Jack Burnett Murta: Mr. Speaker, I would like to direct a question to the House leader in his capacity as minister responsible for the GATT negotiations. It appears certain the United States will be demanding deeper and broader tariff cuts than those proposed by Canada at the Tokyo trade discussions going on at Geneva. According to some American sources, the Canadian offer-which is basically the Swiss formula-will not be acceptable to the United States.
I ask the minister what Canada's position will be with regard to the United States proposal for lower tariffs than those presently formulated by Canada?


Allan Joseph MacEachen: Mr. Speaker, the hon. member will recall that the negotiations are being conducted under the general hypothesis, or a working hypothesis of, I believe, an over-all 40 per cent weighted average cost. I believe the Americans at an earlier point had argued for cuts greater than the 40 per cent, but negotiations are proceeding. Certainly,
April 27, 1978

Canada's participation in the negotiations is based upon this hypothesis.
At the present time, offers and proposals are being made. It is not possible at this stage to determine whether the offers made on either side are adequate or will result in the kind of reciprocal advantages which will have to come into play at the end. When Vice-President Mondale was here, his declaration on the trade side indicated that the United States had presented a proposal which went a long way toward meeting Canadian objections, particularly in the field of sector negotiations.


Jack Burnett Murta: Since the proposal Canada put forward, basically the Swiss formula or 40 per cent reduction, the United States has indicated it is looking in the neighbourhood of 61 per cent or 62 per cent on industrial goods, in terms of the proposal it will put forward. Is the proposal the Canadian government has put forward-the basic Swiss formula or 40 per cent reduction-Canada's firm position, or will the government be prepared to negotiate off that position? If so, to what extent would it be prepared to negotiate?


Allan Joseph MacEachen: Mr. Speaker, I believe at the present time all participants are operating under the single hypothesis of a 40 per cent cut. I do not believe the Americans are still pressing for 60 per cent over-all, a cut which was objected to in the earlier stages particularly by the European Economic Community.
The hon. member is asking whether we will back off the over-all 40 per cent. It is understood that countries will seek exceptions from the application of the 40 per cent-that some cuts may be greater than 40 per cent, and others less. It will be an average. When all these are put together, it will be possible to introduce a certain amount of flexibility into the over-all negotiating hypothesis. I should say it is generally understood that when you net out the exceptions and the flexibility, it is expected that a general 40 per cent cut will have been achieved.


LABOUR CONDITIONS
Mr. Arnold Malone (Battle River):: Mr. Speaker, my question is directed to the Minister of Labour. It relates to the question of a 40-hour week for country grain elevator employees and the minister's letter in response that that will not be his implication, and the letter goes on to state, "to have a realistic and reasonable variation in this form provided by regulation". Is that going to be a regulation from his department? Is that intact now? What consultation with country elevators is taking place in relation to that regulation?


Hon. John C. Munro (Minister of Labour):: Mr. Speaker, to answer the last part of the hon. member's question first, we
Oral Questions
have had rather continuous discussions with the country grain elevators and their representatives, as well as the unions involved. At least one or two commissions of inquiry that I can think of were very much involved in the consultative process.
As far as the first part of the hon. member's question is concerned, the regulation would be drafted by my department; there is no question about that. In view of the fact I announced in the House prior to the passage of Bill C-8 that I was granting a further period of six months for the entire exemption of country grain elevators from the regime under the Labour Code, it is not immediately pertinent.


Arnold John Malone: Can the minister give us assurance that these regulations for a 40-hour a week in country grain elevators- which have peak seasons-are not now lying in wait simply for a period that would follow the next election-and God help us if this government gets back in-simply to be implemented then, as indicated by some of the top officials of his department?


John Carr Munro: Mr. Speaker, I think the hon. member's cynicism is entirely unjustified in this particular situation.


EMPLOYMENT
Mr. James A. McGrath (St. John's East):: Mr. Speaker, I would like to direct a question to the Minister of Employment and Immigration. Is it the intention of Statistics Canada to do away with job vacancy surveys? If so, can the minister explain why this step is being taken at a time when unemployment is in excess of one million Canadians?


Jack Sydney George (Bud) Cullen: That has not been brought to my attention, Mr. Speaker. Statistics Canada comes under the jurisdiction of my colleague, the Minister of Industry, Trade and Commerce. I was not aware they were contemplating that step.


AIR CANADA
Mr. Don Mazankowski (Vegreville):: Mr. Speaker, my question is to the Minister of Transport. It arises from Air Canada's unorthodox firing of some 84 ramp attendants and baggage handlers at United States airports and subsequently awarding the contract to an outside entrepreneur. Is the minister aware of a ground collision involving an Air Canada DC-8 and a towing vehicle which occurred on April 3 at the John F. Kennedy airport shortly after the transfer took place, causing considerable damage to the aircraft? It had the potential of a serious tragedy.

April 27, 1978
Oral Questions
Since it appears that the incident occurred as the result of inexperience on the part of the operator, will the minister undertake to look into this matter, have the whole question reviewed and, as an immediate step, ensure that the people providing this service are indeed qualified to do so?


Hon. Otto E. Lang (Minister of Transport):: Mr. Speaker, the incident had not been brought to my attention. I am not sure the hon. member has any basis for suggesting the cause of it as he has outlined it. I did look at Air Canada's analysis of the reason for their change and the great economies involved in going to the new system. It seemed sensible to me. I will certainly be glad to bring the hon. member's representation to the attention of Air Canada concerning the qualifications of the people now involved.


FINANCE
Mr. A. D. Alkenbrack (Frontenac-Lennox and Addington):: Mr. Speaker, I have a question for the Minister of Finance arising out of Canada's present dilemma in trade and the fact that Canada is losing its shirt because Canada's shirt is losing.


Some hon. Members:: Oh, oh!


Almonte Douglas Alkenbrack: Since current trade and mercantile policies of this government have disillusioned and muddled the Canadian people to the extent that they cannot afford to purchase the products of their own handiwork, what is this government doing to help our Canadian textile industry in the present crisis of unfair foreign competition? An example is the sale of men's shirts today in a large store on the Sparks Street mall, the Canadian-made shirt selling at $8.99 and the Korean competitor selling at $3.99-the latter outselling our product six to one?


Joseph Jacques Jean Chrétien: Mr. Speaker, we have had a policy for a year and a half of establishing a quota system in Canada and dividing the Canadian market between Canadian textile products and imported products. I hope Canadian workers will never be called upon to work at the same rate as Korean workers.


AGRICULTURE
Mr. John Wise (Elgin):: Mr. Speaker, my question is directed to the Minister of Agriculture. With reference to the possibility of using greater quantities of skim milk powder for livestock feed purposes, has the minister had discussions with any of the Canadian feed manufacturers or producers with

regard to a special arrangement to make this product available to them?


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, I understand the Dairy Commission has had discussions in the past, although I do not know how recently. We announced a new program for this year of $6.5 million. Part of that is to be used to develop new uses for skim milk powder. That program allows them to use it in any fashion or form they think is better economically than throwing it on the world market and trying to get rid of it in that way.


John Wise: I am not referring to that at all. I am advised that some discussion was held with either the minister or the officials of the Department of Agriculture, and the commitment was given that a special arrangement would be made to make this product available to Canadian feed manufacturers at a price less than the support price, which would be 74 cents. That commitment was to be delivered when the dairy policy was announced on April 13, but there was no mention of it. Is the minister saying that no meeting was held and no commitment was ever given to either the Canadian Feed Manufacturers Association or any other producer group in Canada?


Eugene Whelan: Mr. Speaker, I am not aware of any meeting. No meeting took place between myself and any representatives of the feed manufacturers on an official scale. I did meet with some of them informally and we did talk about many things. We never talked about any formal arrangements or skim milk powder at world prices for animal use, as a supplement in place of protein. That has been discussed in the past for a special veal feeding program, a calf feeding program, and so on. I do not know how far it has advanced. I will certainly check and let the hon. member know.


FINANCE
Mr. Derek Blackburn (Brant):: Mr. Speaker, my question is directed to the Minister of Finance. It has to do with personal income tax deductions for a parent or parents of children who suffer from cerebral palsy. I am not referring to cerebral palsy children actually confined to a wheelchair, but those who, thanks to surgery, are able to walk and get around.
At the present time these parents have to pay up to $40 a month for shoes, $70 to $75 a month for special tuition fees, and so on. Will the minister consider allowing personal income tax deductions or exemptions for the very high costs these parents have to meet?


Joseph Jacques Jean Chrétien: I will take notice of the suggestion made by the hon. member and ask my officials to look into it. Any changes, of course, would have to wait for the next budget.
April 27, 1978


PRIVILEGE
Mr. Speaker:: Order. The hon. member for Halifax (Mr. Stanfield) yesterday, by way of a question of privilege, expressed concern with regard to matters which arose during the question period and I indicated then, in a preliminary way, and I repeat now, that although I respect the hon. member's suggestion that if I were to adjudicate in a general way he might then put forward a motion, I must say to him that on a number of procedural grounds it is impossible for me to bring the issue into the necessary focus unless I have a motion in front of me. The motion itself may be procedurally correct or otherwise, but in any case it is necessary for me to have a motion before me so that I can adjudicate on it. I will therefore have to leave the matter open for the hon. member to put forward a motion. Should he wish to do so, I would think the matter would be reopened for discussion, depending upon the content of the motion.


Robert Lorne Stanfield: I have a motion here, Mr. Speaker, which I will move if you find I do have a prima facie case of privilege. It reads as follows:
That the matter of the Solicitor General's refusal to provide information respecting surveillance by the security forces of legitimate political candidates, and his contention that the McDonald commission is the only suitable vehicle to investigate a question affecting the privileges of all members of the House of Commons, be referred to the Standing Committee on Privileges and Elections.


Some hon. Members:: Hear, hear!


Mr. Speaker:: The hon. member for Halifax has raised a subject which is obviously of fundamental importance to the House of Commons and I am sure it is of concern to members. The matter was raised in a general way yesterday. Now that a specific motion is before the House, I wonder if it would not be appropriate to allow time for hon. members to prepare arguments which might be helpful. We did hear some preliminary argument yesterday, but it was advanced without preparation. Now that the specific text of a motion is before us, members might wish to participate at this point in some argument on the merits, or else do so tomorrow after questions, or at the first opportunity, Monday, perhaps. I certainly think it is a matter of grave and fundamental importance if there is any suggestion that candidates for membership in this House are in any way interfered with by reason of an official directive. It is not a point I would wish to treat lightly, or without hearing full argument on both sides of the question.


Robert Lorne Stanfield: Mr. Speaker, I made my argument yesterday. I shall be away from the House tomorrow and I do not ask that the matter be delayed, because I do not know what the intentions of the Prime Minister (Mr. Trudeau) are with respect to the life of this parliament.


An hon. Member:: Neither does he!
Business of the House


Robert Lorne Stanfield: I would be very happy to see the discussion proceed tomorrow in my absence. I have had my say on the matter already.


Hon.   J.-J. Blais@Solicitor General: That suggestion is acceptable to me, Mr. Speaker. Indeed, I should like to make a contribution to the discussion tomorrow. As well, I could before then, perhaps, speak to the hon. member for Halifax (Mr. Stanfield) with regard to the points I shall be making tomorrow and, in the event he has further comments to make,
I would be pleased to receive them.


Mr. Speaker:: Then it is agreed that the matter stand over for further argument, if any, until tomorrow after questions.


BUSINESS OF THE HOUSE
Mr. Baker (Grenville-Carleton):: Mr. Speaker, looking over at the government is like looking over at the living dead.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Walter David Baker: But since the Prime Minister (Mr. Trudeau) does not seem to know whether the House will stay or go, or what will happen to it-he seems to be dithering a bit-perhaps I can assume that his seat mate, the government House leader, will be proceeding on the assumption that we are staying. He has given us a list of legislation which includes Bills C-36, C-10, S-8, C-42, S-9 and C-4, indicating that this will be the order in which they will be taken unless changes are made later. Would it not now be appropriate, since we are in this state, for the government House leader to tell us today what are his priorities with respect to legislation as we look to the balance of the session, however long it might be? On the assumption that the Prime Minister has lost his nerve and has decided that parliament should stay, could we be told what the legislative priorities of the government might be quite a way "down the road?"


Allan Joseph MacEachen: The hon. member has referred to the announcement of legislation I made on Thursday last. That announcement still stands. I might add that, in accordance with the suggestion of the hon. member for Grenville-Carleton (Mr. Baker), next Wednesday will be designated as an allotted day.
I am quite interested in the suggestion the hon. member has made with regard to legislative priorities "down the road." I shall be happy to look at the order paper and indicate, at the first opportunity, what legislation we shall be seeking in the next indefinite period. All I will say now to the hon. member is this: he has prefaced all these questions on recent Thursdays by speculating as to whether we shall be here. Well, Mr. Speaker, my track record has been perfect, and the hon. member ought to take my word for it.
4922

April 27, 1978
Bank Act


Some hon. Members:: Oh, oh!


Stanley Howard Knowles: I suppose the question we should like to have answered is whether we are going down the road or out on the campaign trail. But since we are still here, can the hon. gentleman tell us whether there is any intention to bring before the House any legislation arising out of the recent so-called budget?


Allan Joseph MacEachen: Yes, Mr. Speaker, it is proposed that the bills based upon the budget will be brought forward. As the hon. member knows, I stated yesterday that there will be amendments to the Criminal Code. One or two bills related to the Criminal Code will be introduced. In addition, a bill will be introduced tomorrow, I believe, in the name of the Solicitor General (Mr. Blais), so there is a considerable body of legislation available to the House before we would contemplate adjourning.



ROUTINE PROCEEDINGS

[Stage Direction]
[ Translation]

Mr. Jean-Robert Gauthier (Ottawa-Vanier) moved: for leave to introduce Bill C-447, to amend the Official Languages Act (notices and advertisements).


Some hon. Members:: Explain.


Jean-Robert Gauthier: Mr. Speaker, the purpose of this amendment is to extend to national corporations, companies and associations incorporated or existing under an act of Canada the language requirements provided in the Official Languages Act as regards public notices and advertisements.


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

Jean-Robert Gauthier: for leave to introduce Bill C-448, to amend the Bank Act (sale advertisements).


Some hon. Members:: Explain.


Jean-Robert Gauthier: Mr. Speaker, the purpose of this amendment is to extend in all Canadian provinces the right for Canadian banks to advertise in newspapers in both official languages. Presently the act restricts this practice to the province of Quebec where publication of advertisements may be published in the English language in French language newspapers.


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

[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: 799, 886, 1,093, 1,405, 1,406 and 1,407.


Mrs. Pigott: E what was the total number of houses rehabilitated under the Neighbourhood Improvement Programme (a) nationally (b) in each province?
2.	What amount, including start-up funds, sustaining grants and bridge loans, was allotted for such construction (a) nationally (b) in each province?


Hon. Andr6 Ouellet (Minister of State for Urban Affairs):: am advised as follows by Central Mortgage and Housing Corporation: the Neighbourhood Improvement Program is intended for the improvement of the amenities of neighbourhoods and the housing and living conditions of the residents of such neighbourhoods and not for the rehabilitation of housing in those neighbourhoods. For information on the latter, see the answer to question 886 answered this day.


Mrs. Pigott: Order Paper Questions
Residential Rehabilitation Assistance, Start-up Funds, Sustaining Grants,
Under the National Housing Act, by Province, 1974-1977 (1)
Residential Rehabilitation
Assistance	Start-up Funds	Sustaining GrantsSection 34.1	Section 37.1	Section 36(g)Province	Hostel	Loans	Units	Beds	$000	$000	$000Newfoundland	1,292	1,407	78	6,450	33	54Prince Edward Island	2,383	2,663	2	12,154	26	55Nova Scotia	2,489	2,688	33	11,754	196	167New Brunswick	3,782	4,701	89	17,990	72	595Quebec	4,015	7,932	42	43,351	558	378Ontario	5,005	8,009	1,430	29,518	1,220	2,056Manitoba	1,001	1,266	28	5,067	107	1,908Saskatchewan	3,887	4,186	88	12,818	76	1,876Alberta	2,521	3,054	123	11,283	228	1,032British Columbia	4,082	7,045	1,308	22,512	748	888Yukon Territory	-	-	-	-	48	100Northwest Territories	44	44	-	149	294Canada	30,501	42,995	3,221	173,046	3,312	9,403
(1) Data are gross.


Mr. Brisco: 1. For 1977 to date, what was the total expenditure in each constituency in British Columbia or in each CMHC jurisdictional area of the NIP-RRAP Programme?
2. For 1977 to date, what was the total expenditure for the rural portion of the NIP-RRAP Programme in British Columbia, by constituency or by CMHC regional area?


Hon. Andrl Ouellet (Minister of State for Urban Affairs):: am advised as follows by Central Mortgage and Housing Corporation: 1. and 2.
Residential Improvement and Neighbourhood Improvement Program Activity Under the National Housing Act, British Columbia, by CMHC Field Office, 1977
Residential Rehabilitation	Neighbourhood Improvement
Sec./Art. 34.1
Rural and Native	Total	Section 27.5	Section 27.2Field Office	Loans	Units	Hostel Beds	$000	Loans	Units	Hostel Beds	$000	Loans $000	Grants $000Cranbrook	12	12	-	67	185	196	-	758	-	1,475Kamloops	-	-	-	-	70	70	-	285	-	-Kelowna	-	-	-	-	8	37	-	52	-	430Prince George	8	8	-	41	48	52	-	235	-	Vancouver	-	-	-	-	1,322	2,756	697	9,000	-	3,275Victoria	-	-	-	-	393	608	-	1,925	-	620British Columbia	20	20	-	108	2,026	3,719	697	12,255	-	5,800


Mr. Knowles (Winnipeg North Centre): 1.	How many retired public servants are receiving pensions, including their basic pensions and any supplement or supplements added thereto, of amounts within each of the following brackets (a) less than $20.00 per month (b) $20.00 to $29.99 per month (c) $30.00 to $39.99 per month (d) $40.00 to $49.99 per month (e) $50.00 to $59.99 per month (f) $60.00 to $69.99 per month (g) $70.00 to $79.99 per month (h) $80.00 to $89.99 per month (i) $90.00 to $99.99 per month (j) $100.00 to $149.99 per month (k) $150.00 to $199.99 per month (1) $200.00 to $249.99 per month (m) $250.00 to $299.99 per month (n) $300.00 to $399.99 per month (o) $400.00 to $499.99 per month (p) $500.00 to $599.99 per month (q) $600.00 to $699.99 per month (r) $700.00 to $799.99 per month (s) $800.00 per month and over?
2.	How many widows of public servants or of retired public servants are receiving pensions, including their basic pensions and any supplement or supplements added thereto, of amounts within each of the brackets indicated in the above question?
3.	What is the number of retired public servants and also the number of widows of public servants or of retired public servants presently residing in each province?
4.	In respect of how many orphans of public servants are pensions being paid and what is the average amount thereof?


Hon. Robert K. Andras (President of the Treasury Board):: Annuitants	Widows
Less than $20 per month	L (a)	155	2. (a)	143$ 20 to $ 29.99 per month	(b)	153	(b)	515$ 30 to $ 39.99 per month	(c)	301	(c)	1,034$ 40 to $ 49.99 per month	(d)	616	(d)	1,281$ 50 to $ 59.99 per month	(e)	984	(e)	1,328$ 60 to $ 69.99 per month	(0	1,173	(0	1,354$ 70 to $ 79.99 per month	(g)	1,289	(g)	1,275$ 80 to $ 89.99 per month	(h)	1,310	(h)	1,286$ 90 to $ 99.99 per month	(i)	1,369	(i)	1,178
8003 8-2 2 Vi

April 27, 1978
Order Paper Questions
Annuitants	Widows
$100 to $149.99 per month	ti)	6,941	0)	5,112$ 150 to $ 199.99 per month	(k)	6,636	(k)	4,203$200 to $249.99 per month	0)	5,825	(1)	3,038$250 to $299.99 per month	(m)	5,100	(m)	2,065$300 to $399.99 per month	(n)	8,464	(n)	1,920$400 to $499.99 per month	(o)	6,950	(o)	788$500 to $599.99 per month	(P)	5,872	(P)	361$600 to $699.99 per month	(q)	4,218	(q)	193$700 to $799.99 per month	(r)	2,697	(r)	105$800 per month and over	(s)	7,971	(s)	158Total	68,024	27,337Annuitants	Widows	3. Newfoundland	901	376Prince Edward Island	506	187Nova Scotia	4,280	1,714New Brunswick	2,323	884Quebec	10,768	5.326Ontario	28,854	11.460	Manitoba	3,169	1,211Saskatchewan	2,067	756Alberta	4,004	1,444British Columbia	10,071	3,511N.W. Territories	96	29Yukon	126	274. As at March 31,	1978,	69 orphans	were receiving an	
average of $285.62 per annum.


Mr. Knowles (Winnipeg North Centre): 1.	What was the total amount at credit in the Public Service Superannuation Account as at March 31 (a) 1975 (b) 1976 (c) 1977?
2.	What rate of interest has the government paid for the use of this money during the fiscal years ending on the dates noted above?
3.	What amount of interest was credited to the Public Service Superannuation Account during the fiscal years ending March 31 (a) 1975 (b) 1976 (c) 1977?
4.	What was the total amount paid out of the Public Service Superannuation Account during the fiscal years ending March 31 (a) 1975 (b) 1976 (c) 1977?


Robert Knight Andras: 1.	(a) $6,420,297,891; (b) $7,312,248,146; (c) $8,147,817,891.
2.	Quarter ending June 30, 1974, 1.5642; September 30, 1974, 1.5900; December 31, 1974, 1.6259; March 31, 1975, 1.6363; June 30, 1975, 1.6612; September 30, 1975, 1.6742; December 31, 1975, 1.7109; March 31, 1976, 1.7209; June 30, 1976, 1.7471; September 30, 1976, 1.7488; December 31, 1976, 1.7707; March 31, 1977, 1.7891.
3.	(a) $227,008,801; (b) $263,884,375; (c) $297,217,070.
4.	(a) $184,831,352; (b) $211,647,033; (c) $280,409,339.


Mr. Knowles (Winnipeg North Centre): 1.	In each year since the Public Service Pension Adjustment Act of 1959 was passed, how many persons have received payments thereunder?
2.	In each of the above years, what was the total amount paid under the Act?
3.	In each of the above years, what was the average amount paid under the Act to (a) retired public servants (b) widows (c) others?
4.	In each of the past five years, either calendar or financial, for which statistics are available, how many pensions under the Public Service Superannuation Act to (a) retired public servants (b) widows of public servants or widows of retired public servants, have been discontinued because of the death of the superannuate?


Robert Knight Andras: i.	Year	Number	
	1959-60	14,311	
	1960-61	13,885	
	1961-62	12,533	
	1962-63	11,709	
	1963-64	10,852	
	1964-65	10,077	
	1965-66	9,078	
	1966-67	8,162	
	1967-68	7,483	
	1968-69	6,860	
	1969-70	6,651	
	1970-71	6,474	
	1971-72	5,793	
	1972-73	4,647	
	1973-74	3,901	
	1974-75	3,253	
	1975-76	2,706	
	1976-77	2,381	
	1977-78	2,094	
		Total Paid	
2.	1959-60	3,112,231	
	1960-61	2,956,515	
	1961-62	2,817,263	
	1962-63	2,657,706	
	1963-64	2,504,503	
	1964-65	2,344,711	
	1965-66	2,236,212	
	1966-67	2,038,329	
	1967-68	1,905,478	
	1968-69	1,777,869	
	1969-70	1,641,304	
	1970-71	1,515,000	
	1971-72	1,368,879	
	1972-73	1,000,941	
	1973-74	838,715	
	1974-75	697,981	
	1975-76	501,691	
	1976-77	417,415	
	1977-78	331,219	
3. Year	(a) Public Servants	(b) Widows	(c) Others1959-60	226.72	124.88	12.321960-61	225.43	124.42	11.791961-62	222.01	123.92	10.351962-63	220.60	123.59	10.061963-64	220.26	123.75	7.991964-65	217.94	123.08	6.191965-66	216.03	122.69	7.131966-67	212.52	122.64	5.931967-68	210.27	121.27	6.111968-69	208.19	119.21	4.561969-70	196.52	125.05	5.791970-71	184.83	127.87	1971-72	177.51	130.19	1972-73	174.19	128.47	1973-74	163.05	114.27	1974-75	161.19	102.98	1975-76	158.27	101.01	1976-77	157.21	99.81	1977-78	149.69	88.67	-4. (a) Retired Public Servants	(b) To Widows	1973-74	2,488	1973-74	7501974-75	2,250	1974-75	5321975-76	2,367	1975-76	6811976-77	2,319	1976-77	7021977-78	2,437	1977-78	859[English]	I ask, Mr. Speaker, that the remaining questions	be allowed
to stand.
April 27, 1978


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


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Wednesday, April 26, consideration of the motion of Mr. Horner that Bill C-36, to amend the Export Development Act, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Charles Joseph Clark: Mr. Speaker, I want to make a brief intervention in this debate at this stage. As the House of Commons knows, there are a number of aspects of the legislation respecting the Export Development Corporation which are of very real concern to hon. members on this side of the House and to the people of Canada generally.
I personally have been alarmed at the performance of information officers of the Export Development Corporation, which very much borders on the partisan, in some of the attacks they have levelled against members in this House of Commons. I think this goes well beyond the proper bounds of the activities of information officers of a Crown corporation. It is a matter to which we will want to turn more attention later.
We are also very deeply concerned about the degree to which the Government of Canada has used the Export Development Corporation as a contributor to the economic hocus-pocus of this government by which it attempts to hide the degree of obligations and the degree of indebtedness which have been brought to Canada by the operations of the present government.
This bill would authorize the Export Development Corporation to raise $26 billion. That is, in effect, a three-fold increase in its authorized accounts. That amount is not reflected in the national accounts of the government, and it is natural that we and others who are concerned about sound economic management in this country should ask questions as to why that very significant amount is omitted from the national accounts. The answer of the government is that it does not believe that loans by the EDC are direct obligations for the taxpayers of Canada. That position by the government is denied by publications of the EDC itself. That is very seriously misleading, because it allows the Government of Canada to claim that federal government spending and federal government obligations are much less than they are in fact, and I think that this govern-
Export Development Act
ment would find that it would be able to generate much more confidence in the Canadian business community, and among Canadians generally, if it were prepared to come clean and speak the truth about its full indebtedness.
The Government of Canada should stop trying to cook the books, as it has been doing with the Export Development Corporation.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: I want to deal with the specific direction of this legislation. This bill would raise the loan ceilings of the Export Development Corporation to $12.5 billion from the present $5.1 billion. It would raise the insurance ceiling to $13.5 billion from $3.5 billion.
We all know that the broad objective of the EDC is to encourage and promote Canadian exports. That role is carried out by the EDC by providing insurance and loans to finance capital projects throughout the world, and to tie those projects and that financing to the purchase of Canadian goods and materials. Of course, nobody can object or take exception to that basic purpose. Nobody would find fault with a Canadian government policy designed to promote Canadian exports, but when we look beneath the surface at what is going on in the EDC, and once we study its operations and look at the nature of the ventures in which it has become involved in the world, it becomes clear that the activities and the impact of the EDC go well beyond that general purpose of which all of us can approve.
There is in the activities of the EDC much more than that which appears on the surface. In many cases we are clearly realizing some short-term gains for Canada in terms of encouraging exports, but we are also-and this is the point to which attention has been drawn-gathering for this country some very serious long-term harm. What is happening, stripping away all of the detail-and I want to get to some of the detail later on-is that Canadian money is being used to build plants abroad which will compete with plants which are already operating in Canada. Canadian money is being used now to build plants abroad whose existence outside this country may very well prevent the development and construction of plants and the provision of jobs right here in Canada. In other words, we have a situation where we may be spending Canadian money now to create Canadian unemployment later, and that, sir, is a piece of foolishness which no sane, responsible parliament can approve or sustain.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: It is not at all surprising that this kind of proposed legislation comes from this government because, if this government is anything, it is a short-term government. In the name of long-term economic planning this government brought in a six-month budget. With its eye on trying to alleviate unemployment, which grows most acute in October and November, this government introduced a sales tax cut which will end when unemployment becomes most acute. This government is committed to the short-term, and it is absolutely

April 27, 1978
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incapable of taking a long-term look at the future of this country. While that might be the pattern of what this government has done, we in this parliament have a much larger responsibility. The government might be interested in surviving only the next six months, but the Parliament of Canada has to be interested in the country's being able to survive and be strong for a much longer period of time.
As in the case of many agencies of the federal government, we need a full scale, thorough, and calm review of all the activities of the Export Development Corporation. We need to have the opportunity, in an atmosphere of calm, and without any unusual pressures, to sort out the gains for Canada from the losses for Canada and to ensure that Canadian public policy is designed exclusively to create opportunities for this nation and is not designed, as is unfortunately the case with some of the loans and activities of EDC, to have the consequence of creating new problems for this country. We cannot get that kind of examination of the bill now for a variety of reasons, some of which I intend to go into, but I make the point in passing that an examination of EDC should be one of the very early activities that is undertaken by this parliament once we have introduced into practice here the concept of the sunset law, the concept of an automatic review of the effectiveness of federal agencies. That is a commitment that my colleagues and I intend to introduce early after the next election-


Some hon. Members:: Hear, hear!


Charles Joseph Clark: -so that we and the Canadian taxpayers can be sure that there will be an opportunity to review, coldly and carefully, the effectiveness of agencies which are now in place.


Yvon Pinard: You are dreaming.


Charles Joseph Clark: My colleague opposite says I am dreaming. I presume he means I am dreaming in thinking that there might be an election. I say to him that his party can only run so far. Your Prime Minister (Mr. Trudeau) is running away from the election now, but he has to call one within a year from July. You might have a year left if you demonstrate more reluctance to face the electorate than you have in the past few weeks. But your time will come, and the people of Canada will have an opportunity to have a government that will introduce sunset legislation and other legislation that will review and curtail the activities of agencies which are not serving the public interest in Canada now.


Some hon. Members:: Hear, hear!


Mr. Abbott:: May I put a question to the Leader of the Opposition (Mr. Clark)?


Charles Joseph Clark: Please go ahead.


Anthony Chisholm Abbott: I want to be clear whether he is suggesting he would introduce a sunset provision to bring the sun down on the EDC.


Some hon. Members:: Oh, oh!


Charles Joseph Clark: What I am suggesting to the minister, Mr. Speaker, is that I think it is past the time when individual members of the House of Commons had the opportunity to have some real impact upon controlling the activities and the expenditure of the Government of Canada. That is the tradition of parliament; that is why we are here. It is a tradition which has been broken by the government of which the minister is a part, and it is a tradition which we intend to reintroduce. One of the means by which we intend to introduce it is by bringing into practice a sunset law which would ensure that a committee of this parliament will have the opportunity to examine in detail whether agencies and operations, such as EDC, are in fact carrying out their mandate. They will be subject to detailed examination. If it is found that they are not carrying out their mandate, then they will go out of business. If it is found that their mandate is inappropriate, then their mandate will be changed. I am sure the minister will agree that that would be a very helpful innovation in the House, and I am sure he will also agree that it will only occur with a change of government.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Our problem right now is that this government has manufactured a crisis, which means that we cannot give EDC the kind of searching analysis that is required now because there are certain immediate and legitimate pressures upon the government. In short, the problem is that EDC has already reached, or has very nearly reached, the lending limits which have been authorized by the House, and exports of Canadian goods will be lost if the House does not move fairly quickly to pass this bill raising the loan ceilings of EDC.
There is one reason why this has happened, there is one culprit here, and that culprit is the government itself because it could have brought this legislation in some time ago, and then we would be considering it calmly rather than in an atmosphere of crisis. Instead of acting responsibly and with foresight, this government waited until the last minute, as it does so often. It has now provided the House of Commons with this legislation in a crisis atmosphere, forcing us to decide too quickly on a matter which involved the potential expenditure and the obligation to Canada of literally billions of dollars.
I should simply add that this incompetence in economic matters is not at all confined to EDC. Another example is the Bank Act. The Bank Act has been delayed. It has been more than two years since this government brought to the House of Commons its White Paper on revisions to the Bank Act. As hon. members will recall, the Bank Act has to be revised every ten years. The date of the last revision was 1967. What we get instead of action we need are two extensions to the 1967 act because this government is so unable to manage that it cannot bring forward its amendments, and it cannot bring forward a new bill on time. We are told that the bill is ready but that the government will not bring it forward because, presumably, it does not want the people of Canada to know what the Prime Minister meant when he said the other day to me that the

April 27, 1978

Bank Act will deal with les caisses populaires and with credit unions.
Let me come back to this bill, because the government's inaction and delay have created an atmosphere of crisis about this bill also. Under the provisions of this legislation, the total authorization for EDC would increase to $26 billion from $8.85 billion. That $26 billion is equivalent to 10 per cent of the current domestic gross national product.
Since 1969 when the EDC was first established, the authorized capital for corporate lending has risen from $600 million to $10 billion-a sixteenfold increase in less than ten years. In corporate insurance, this rise has been from $250 million to $10 billion during the same period. In other words, the growth has been nothing less than dramatic.
But we have to ask the question: what do EDC loans provide Canadians? The EDC, just to cite some examples, has lent something like $350 million to finance pulp and paper mills in Poland, Peru, Romania, Argentina, and Iran. These projects, built with Canadian capital goods, eventually compete with Canadian pulp and paper mills for markets. This is particularly troubling in view of the difficulties that Canadian manufacturers of pulp and paper products have had in finding markets during the last couple of years.
Again, EDC has financed $78 million worth of nickel mining projects in Guatemala and Indonesia. We know to our sorrow that 4,000 Canadian miners recently lost their jobs in Sudbury because of depressed world nickel markets. That was before these two new EDC financed nickel mines, operated with cheaper labour than is available in Canada, achieved full production.
Again, EDC financed a mini steel mill in New Jersey, the cost of which was in the neighbourhood of $47 million. It financed other steel operations in Texas, Minnesota, and Great Britain. In fact EDC financed steel mills outside of this country with $100 million in Canadian taxpayers' money, and that at a time when Algoma steel is experiencing difficulties in finding markets for its rolled steel products, and at a time when Stelco is forced to slow down the pace of construction for its Nanticoke mill because it has no markets for its end product.
Again, EDC has financed projects in a number of countries behind the Iron Curtain, such as in Russia, Poland, as I mentioned, Yugoslavia, Czechoslovakia, Romania, Hungary, Bulgaria, and Cuba. Many of the projects which have been financed by EDC will compete directly with Canadian manufacturers, when they are completed. Because all operate with state planned economies, wage costs can be adjusted in various ways to make plants competitive at all cost in world markets and to make them competitive with Canada in an unfair way.
The point that we cannot lose sight of, and the point that I rise today to emphasize, is that the activities of EDC may seem to be providing a short term benefit for Canada. We may have exports of capital equipment to build steel mills and pulp and paper plants, but that is only a short term benefit. The long term result could very well be the loss of Canadian jobs to
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concerns and projects which are financed abroad by the Canadian Export Development Corporation. These plants are more efficient because the are newer and cheaper to operate, and because they operate in countries where wage costs are lower. What long term good is there for Canada if we eliminate our own industries for the short term advantage of some export contracts?
Part of the difficulty is that the government is operating, in terms of the Export Development Corporation, without any kind of long term industrial strategy.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: There have been a number of failures by this government during the ten years in which it has been in office. But none has been more significant for the long term future of the country than its absolute failure to establish any over-all sense of direction for Canadian industrial development. That means Canada goes to GATT with no industrial strategy than to follow the Americans. It means we have the Export Development Corporation spending Canadian money to create plants abroad that will compete with Canada and cause unemployment here. It means a number of other inconsistent actions which can work very seriously against the long term interests of Canada. Canada requires a national industrial strategy which will provide some direction for the Export Development Corporation, as well as some direction in what we are doing at GATT. Instead of that, we receive six-month budgets and Export Development Corporation bills brought in at the last minute during a state of crisis, when there cannot be the detailed examination that the public interest and the House of Commons require.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: What is abundantly clear to all of us is that the Export Development Corporation engages in very little long term planning. It is an ad hoc organization, operating without the guidance of a national industrial strategy. It looks for immediate gains, but it gives far too little attention to the long term costs to Canada of some of the ways in which it is spending Canadian money abroad.
I do not blame the directors of the Export Development Corporation. As always, the fault lies with the government of the day on questions of policy. The government of the day has failed to give the direction which is necessary to the Export Development Corporation. The government of the day has failed to develop the industrial strategy which our nation needs. Because of those failures by the government, we face a short term crisis now. There is a real dilemma for EDC.
The government has delayed the introduction of this piece of legislation for so long that a crisis has been created. We will help the government get out of that crisis. Also we will assist it in raising very quickly the authorized capital of EDC. But in committee, in the next stage of debate on this matter, we will

April 27, 1978
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propose that the ceilings be lowered by an aggregate of $10 billion.
In the case of the corporate loan ceiling, the government has proposed an amount of $10 billion. We will offer an amendment lowering that amount to $6 billion. The government is proposing a loan ceiling on government loans of $2.5 billion. We will offer an amendment to make that amount $1.5 billion. In addition, we will propose that the government's proposal for insurance and guarantee authorization be lowered by $5 billion. That will be an aggregate lowering of the ceilings by $10 billion, which is a great deal of money, as much as the total spending of the government when it first took office, and as much as its deficit is now. It leaves substantial spending power with that Crown corporation. But the people of Canada need the assurance that money will be used in the best long term interests of our country, and that we will not sacrifice many jobs tomorrow for a few jobs today.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: We are prepared to act in the public interest and in the tradition of parliamentary responsibility, which has marked our participation in attempting to bail out the government and rescue it from its own incompetence throughout this session. We will help the Export Development Corporation out of its present difficulties. The fact that we are prepared to help in this way does not solve the far more serious problems concerning the proper role of EDC. It does not solve the far more serious problems of the absence in this country of a national industrial strategy which can provide guidance and direction to government agencies and private entrepreneurs who operate now in a policy vacuum.
Those changes can only come with an election which will allow Canadians to make a choice between a government which thinks in terms of six-month budgets and spending money now to create Canadian unemployment later, and a new government which is determined to bring in a national industrial strategy which will give guidance to Canadian Crown corporations and private entrepreneurs, and bring some sense of honesty and restraint into the activities of government in this country.


Some hon. Members:: Hear, hear!


Mr. Young:: Mr. Speaker, will the hon. Leader of the Opposition (Mr. Clark) permit a question?


Charles Joseph Clark: Certainly, Mr. Speaker.


Roger Carl Young: In the context of the hon. Leader of the Opposition's remarks that these Export Development Corporation contracts with Soviet nations were detrimental to Canada, and that they resulted only in plants being built in other countries with a potential loss of jobs to Canadians, can he explain those remarks, in view of the fact that I am aware of an EDC-backed contract which helped a truck manufacturer in this country to build a brand new factory, thus creating over 100 new jobs?


Charles Joseph Clark: Question.


Mr. Paproski:: Do not make a speech.


Walter David Baker: Ask your question.


Roger Carl Young: I am asking a question. It is a specific one.
A second EDC-backed contract in Indonesia helped put 200 men back to work in Canada, who had been laid off for three months.


Charles Joseph Clark: Mr. Speaker, obviously the hon. member opposite requires some practice in asking questions. If he survives the next election, he will get some practice doing that.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: I said that the Government of Canada, through the Export Development Corporation, is aiding the development of industries in Iron Curtain countries and other countries.


Roger Carl Young: And in this country.


Charles Joseph Clark: If the hon. member wants to rise in his place once again, he can do so. But he prefers to shout across the floor, which is typical of the action displayed by the Liberal party throughout this session of parliament.


Some hon. Members:: Oh, oh!


Charles Joseph Clark: Since the hon. member asked a question, which I can only presume was serious I presume he is interested in the concern I and many other Canadians have. The government spends substantial amounts of money now, and makes money available to encourage the development of industries in countries which operate under a different market system than ours, and where the state controls and keeps wage levels low. When the government subsidizes the creation of industries in those countries, which compete with similar industries here, it is much more difficult for Canada to compete in the world. They may well be raising competition for industries which now operate in Canada. If that is being done, Canadians who have jobs now may well be jeopardized, or jobs Canadians could look forward to may be jeopardized. The question which must be answered is: why should Canadian money be spent to help other countries compete with us, at the cost of Canadian jobs in the future?


Roger Carl Young: It is putting our own people to work.


Charles Joseph Clark: That is the type of question which has been raised repeatedly by hon. members on this side of the House. It is the type of question government spokesmen consistently attempt to ignore. It is a basic question. This is the reason why there must be a thorough review of the activities of the Export Development Corporation in this country. That is the kind of review that we want to see happen, and the kind of review that we will introduce after the next election. In the meantime we are prepared to help the government out of the crisis it has created, by increasing the ceilings.
April 27, 1978


Some hon. Members:: Hear, hear!


Anthony Chisholm Abbott: Mr. Speaker, acting on behalf of the Minister of Industry, Trade and Commerce (Mr. Horner), I would ask that the debate be closed, and move that the bill be moved to committee. I see that my hon. friend is rising to speak.


Mr. Bob Brisco (Kootenay West):: Mr. Speaker, yesterday during a rather lively debate in the House on this bill, I had the opportunity, or the misfortune-whichever way you would like to put it-of listening to the comments of the hon. member for Comox-Alberni (Mr. Anderson), the Parliamentary Secretary to the Minister of Fisheries and the Environment. After listening to and reading his speech, I wondered whose side he was on. I think he should have stuck to his own department, one which hopefully he knows more about. I hope he is better informed on fisheries and the environment than he is on industry, trade and commerce and the EDC, because the bait that he was trolling would only catch suckers.


Mrs. Pigott:: That is a good one.


Robert Hylton Brisco: Yesterday he stated-and he was on shaky ground, or perhaps he was at sea-that I have no reason to suspect the words of the Minister of Industry, Trade and Commerce (Mr. Horner). That is the statement of the year. I have reason to suspect the words of the Minister of Industry, Trade and Commerce. The people of Alberta have reason to suspect his words, and all other Canadians have reason to suspect his words. For example, the minister made a very solemn promise to the city of Edmonton that he would expand their airport facilities and improve on them. He then lived up to that promise by narrowing it, stenosing it, stricturing it, and restructuring it so that the program really amounts to nothing. I have heard the minister speak in this House very strongly in favour of a beef import act. Now he favours an import-export permit scheme which he himself knows has caused a great deal of difficulty within the beef industry. So much for the flip-flop, cow plop statements of the Minister of Industry, Trade and Commerce.
The parliamentary secretary yesterday said, as reported at page 4904 of Hansard:
Day in and day out I hear doom and gloom from hon. members opposite concerning employment problems-
Thank goodness there is somebody, sir, in this House of Commons who is prepared to draw to the attention of this Liberal government the very real reasons for doom and gloom in this country. We have the Minister of Industry, Trade and Commerce with his new bill, we have EDC with their proposals, and you have the opposition preaching doom and gloom. Where does that doom and gloom come from? It comes from my constituency, from the member's constituency, Comox-Alberni, and from all constituencies across Canada, save and except a few.
Do you know, Mr. Speaker, what the unemployment figures are for my riding of Kootenay West? Obviously, the hon.
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member for Comox-Alberni has no idea what the unemployment figures are for his particular riding, otherwise he would address himself to the very doom and gloom which he accuses us of preaching. If he had the fortitude to come forward and admit to the fact that this country is in a very serious situation, and if he had the fortitude and intelligence to listen occasionally to the opposition, instead of rejecting out of hand any proposals which are put forward, then perhaps he might accomplish something of benefit for his own riding.
I would like to give a brief example of the doom and gloom that face us, why it is doom and gloom, why I am concerned, and why the opposition is concerned at something that absolutely fails to register on the other side. It does not matter what the inflation rate is, it does not matter how many unemployed there are, when it comes down to the cold hard facts, the government acts and reacts about two years out of phase.
Let us look at Statistics Canada. They gathered data on 19 specific categories of manufactured and imported end products and classified them as high technology manufacturers. These are the kinds of items that we see developed in foreign countries by the Export Development Corporation. I have no beef with the basic thrust of that corporation, but my first concern is Canada and jobs for Canadians. I do not care how much rhetoric we hear from the other side about how much the pulp mill in Poland is going to help Canada, it still does not come anywhere near looking to the problems that are before us in terms of our own markets and our own products.
When we wonder where the jobs have gone for the 1.5 million unemployed, we note that most of them, 80 per cent have gone back to the United States. Ten per cent has gone to Japan, and another 10 per cent to Britain and the European community. We have a deficit in end product, high technology manufactured products, of $8.2 billion for 1977. At the risk of boring the hon. member, perhaps he would listen to the impact of these figures. We are not talking pennies or dollars, but we are talking millions and millions of dollars.
What is our export situation and our import situation in terms of some of these products? What about our man-made fibres? The net deficit for man-made fibres is $41,151,000. In chemicals we have a deficit of $253 million. I will not bother with the thousands, because the government does not. In petroleum and coal products, one of the unusual ones, we find that we actually have a surplus of $360 million. Industrial machinery is at $743 million, and mechanical handling equipment, $148 million. These are all deficits, and these are things that we are bringing to Canada that should be manufactured and produced in Canada.
Surely, if the markets are there, as is evidenced by the statistics and the volume of imports, our industries can pick up that slack even if it is only the 20 per cent by which they are now depressed. Other industrial machinery has a $1,296,000,000 deficit. In spite of the fact Canada is one of the major agricultural producers in the world, agricultural machinery has a net deficit on imports of $746 million. In railways, locomotives and rolling stock, the deficit is $46 million.

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We have roadways of over 5,000 miles from sea to sea, highways spread out across the 49th parallel and adjacent to it, thousands of mile, yet we find that road transport equipment has a deficit on imports of $1,036,000,000. In aircraft and parts equipment we managed to create a surplus of $203 million; in other vehicles, $42 million deficit.
We have Northern Telecom trying to expand their telecommunications industry, trying to create more jobs, but being throttled by this government-and my goodness we have a classic example right here with the microphones on our desks that are imported from Austria. We have imports to the tune of $1,173,000,000 in communications equipment. In heating, air conditioning, and refrigeration equipment, we have a deficit of $198 million; domestic and commercial appliances, $946 million; tools, $196 million; office machinery, $384 million. My goodness, you would think that the bureaucracy here in Ottawa could establish its own industry to look after office machinery that is used in bureaucracy alone. Medical, pharmaceutical supplies have a deficit of $405 million, with photographic goods and equipment at $406 million. This adds up to $7,582 million. What was the response of Industry, Trade and Commerce to these figures?
The assistant deputy minister in charge of industrial policy and planning has stated that he does not believe anybody could put together a strategy which will last for more than 30 days. In fact he says debate about an industrial strategy is sterile and should be discontinued. If that is the case, why did the Department of Industry, Trade and Commerce bother bringing in this bill? We reject that proposal by the assistant deputy minister completely. Any country with 22 million people that imports $24.4 billion in high technology products should not engage in a debate, but should get on with the job of eating into that multibillion dollar market by creating jobs and profits right here in Canada. No wonder there are concerns from this side about this new bill for the Department of Industry, Trade and Commerce.
Yesterday in a speech made by the hon. member for Comox-Alberni, either in a blush of honesty or a flash of brilliance, I do not know which, he said that we are like lambs in the international market. Certainly Canadians and members of the opposition know that we have been fleeced, if that is what the member is implying. Perhaps he thinks that Canadians will follow this government like lambs at the next election. I think he may find that the lambs will turn into lions, and that we feed heartily on grits. I did not expect the member to be so thoroughly honest when he made that reference.
In reviewing his speech, probably what concerns me the most was the fact that only once during the period he spoke did he make any reference to any western Canadian industry. That was a one-liner about shareholders of MacMillan Bloe-del. It had no bearing on the thrust and the context of the debate on the bill before us. I would suggest that if the hon. member examines the circumstances in the riding of Comox-Alberni, as I have examined the circumstances for the riding

of Kootenay West, and as other western members have examined the circumstances for their particular ridings, would find that the record of co-operation and the degree of interest demonstrated by the EDC are negligible. It is so much simpler to do business here in Ontario and Quebec, and to hell with the west.
Just to illustrate, the Canadian Export Development Corporation recently provided assistance to Treco Limited, an eastern supplier of prefab housing. I say, look it up in your books. They landed a nice contract of $93 million with Algeria. Nobody in British Columbia was advised that the contract was open. Nobody had the opportunity in British Columbia to bid on that. Nobody in the lumber industry, which was depressed at that time, had an opportunity to know that they could bid on that. I suggest that the officials from the Export Development Corporation add the word "co-operation" after their title and think in terms of talking to the British Columbia Development Corporation. I suggest that these officials have an opportunity to find out from the BCDC how unimpressed they are with the measure of co-operation from the Export Development Corporation.
I know that the Corporation is sensitive; its people do not like criticism. As a matter of fact I took the liberty of mentioning them, in passing reference, in a parliamentary news column. I noticed they were sensitive to that because they responded by a letter to the editor. The Export Development Corporation's director of communications, Mr. John M. Bowles, sent a letter to the editor of the Arrow Lake News and he quoted a number of facts. He said that EDC does not cost the Canadian taxpayer a cent. What he means is it does not cost the taxpayer a cent, it costs the taxpayers billions of dollars! That is what he really means. If the man had the courage of his convictions and if he were really concerned, pehaps he might have followed it up with a letter to me instead of conducting a paper war with the member of parliament for Kootenay West through the media of the editorial columns of a newspaper. That is the only time I have ever heard from Mr. Bowles.
It is significant to note that throughout the speech made by the hon. member for Comox-Alberni, who is a parliamentary secretary for this government, that there was not a single reference to the activities and the degree of support that this Corporation gives to western Canada. I want to put on the record now that British Columbia is thoroughly fed up, as is western Canada, with the failure of the EDC to address itself to anything else but centralized concerns and centralized business.


The Acting Speaker (Mr. Turner):: Order, please. I believe the Minister of State (Small Business) has indicated that he wants to speak on behalf of the Minister of Industry, Trade and Commerce. If he does, I would suggest he will close the debate. Does the Minister of State for Small Business have unanimous consent?


Some hon. Members:: Agreed.
April 27, 1978


Anthony Chisholm Abbott: Mr. Speaker, as acting Minister of Industry, Trade and Commerce I am pleased to have the opportunity today to say a few words in connection with this important bill before parliament.
I think my colleague adequately expressed the importance of the bill and the importance of EDC to the economy, as well as explaining why it is essential that the bill receive as prompt passage as possible. He indicated at the time he spoke that it would be quite open to the committee to interrogate the officers of EDC closely and go into any specifics they might wish.
It was particularly distressing to hear the number of speakers who rose in the opposition and levelled such unsupported allegations in the direction of EDC, particularly the hon. member for York-Simcoe (Mr. Stevens), and the Leader of the Opposition (Mr. Clark) who spoke so ignorantly about the activities of this important element of Canada's export trade. I thought the Leader of the Opposition demonstrated several of the qualities which will almost certainly restrict him from ever occupying the position of Prime Minister of this country.


An hon. Member:: Don't count on it.


Anthony Chisholm Abbott: Of course the hon. member says, "Don't count on it". I shudder to think of the prospects if, by some accident of fate, he was elevated to that position. It is bad enough to have him comment on those matters with which he presumably has some acquaintance. But when he rises in his place today, and suggests that because the Export Development Corporation finances overseas developments consistent with its charter and its very proud history of accomplishment, that somehow it is deliberately taking away the jobs of Canadians by the so-called short-term benefits to them, it is so outrageous and palpably absurd as to make it shameful that a person purporting to be an alternative to the prime minister of this country should ever make such a speech.


Some hon. Members:: Hear, hear!


An hon. Member:: No more shameful than our deficit on imports.


Anthony Chisholm Abbott: He made specific reference to the foundation of a mini-steel mill in New Jersey as an example of his indignation at the taking away of Canadian jobs. This represents a very important development that is being exercised by a company in Whitby which has set up mini-steel mills, not only in Canada but elsewhere in the world. As a result, it has employed as many as 1,500 man-years at this plant, creating this very important element of export. To say that this is somehow setting up a steel mill in New Jersey to compete with Canadians demonstrates once and for all, if we ever needed any demonstration, what an economic, industrial illiterate we have in the Leader of the Opposition.


Some hon. Members:: Hear, hear!
Export Development Act


Anthony Chisholm Abbott: He went on to question the kind of countries the Export Development Corporation is dealing with, countries such as Romania, Poland, and others. He cast insulting aspersions on them. Moreover, he suggested that somehow EDC was guaranteeing loans, with money that would otherwise have been spent in Canada to create jobs in plants for Canadians, and helping to set up competitive industries abroad. He took that as a dastardly betrayal of Canadian economic interests.
I would have hopes that even so parochial and restricted an observer as the Leader of the Opposition might realize that the rest of the world does not stand hopefully waiting for any of those industries to be set up by Canada. Countries such as Poland have other nations of the world eagerly hoping they may be given an opportunity to employ their people to help set up industry, to create paper making machinery, to do all the things that the Export Development Corporation is financing in order to give Canadian manufacturers jobs.
I cite a very outstanding example, the recent contract that the Bell Telephone Company, through Northern Telecom, has with Saudi Arabia. Here is a billion dollar contract competed for and won by a Canadian corporation in that important and growing part of the world. It is to be partly financed through EDC. It will be a profitable deal, as have been nearly all the deals that the EDC has conducted. It is going to bring thousands of jobs to Canadians, not short-term jobs, and will help to create the kind of industrial fibre we need to maintain if we are going to employ as many Canadians as we must.
Far from a record of failure, as has been suggested by the Leader of the Opposition, the Export Development Corporation has been a very successful corporation. It has enjoyed a triple A credit rating with the leading firm of Moody's and with another leading one as well. I forget the name of it. There is no other corporation in the world that enjoys this triple A rating of two leading corporations of this kind.
I am sorry the hon. member of York-Simcoe is not here. He expressed some very dark suspicions about the financial standing of the Export Development Corporation. Anybody who knows the hon. member for York-Simcoe and his own history realizes he must have quite a profound knowledge of shaky operations. I was singularly interested in a comment he made in his speech on this bill, reported at page 4815 of Hansard for April 24, and I quote:
If you have any trouble in the lending business, you never admit it.
I am sure that was the credo by which the former president of the Bank of Western Canada conducted his business. However, I assure him that this kind of subterfuge he may have believed in when he was in the banking business is not the kind of behaviour displayed by officials of the Export Development Corporation.
When those officials appear with the minister before the finance committee I feel certain they will be able to account for themselves very capably as to the deals in which they are involved. They will point out they have never had a year in which they have not enjoyed a profit. They do not need these additional funds because they have somehow failed, but

April 27, 1978
Financial Administration Act
because they have succeeded. They are advancing the frontiers of Canadian industry. They are doing the job for which they have been created.


Some hon. Members:: Hear, hear!


Anthony Chisholm Abbott: Some outrageous suggestions were put forward by the hon. member for Nickel Belt (Mr. Rodriguez). Surprisingly, his views were subscribed to by the Leader of the Opposition who, one would have thought, should know better.
When the International Nickel Company determined to set up in Indonesia, this was a $900 million deal. Their intentions were to buy in Canada about $1 million worth of machinery and parts, if they could. It was only when the Export Development Corporation and other agencies of the Canadian government pressed them that that total was raised to some $60 million. It was financed through EDC.
It was not that Indonesia was unable to set up its mine. It certainly was not going to wait for the Parliament of Canada to give it permission to set up this new mining enterprise. Thanks to the efforts of the EDC, a whole lot of Canadian jobs and manufacturing were created and maintained.
One of the sad aspects in Canada today is that we have a Leader of the Opposition who, on the verge of an election, is not content to puff himself up and say what he will do about sunset laws and other dreams he might have. He chooses to advance his cause by denigrating a vital economic enterprise that is very important to Canada, such as the Export Development Corporation. Some of the members of his caucus have expressed sounder views. The hon. member for Edmonton West (Mr. Lambert) made a rather reasonable speech the other day. The hon. member for Vancouver Quadra (Mr. Clarke) gave us some good comments as well. I hope these gentlemen will ask the Leader of the Opposition to concentrate on those matters he presumably knows something about, and allow them to go to the committee and bring forward important points they may have before this legislation is returned, giving parliament the opportunity to let the EDC get on with its job.


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


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.

[Stage Direction]
The House proceeded to the consideration of Bill C-10, to amend the Financial Administration Act, as reported (without

amendment) from the Standing Committee on Miscellaneous Estimates.
Hon. Marcel Lambert (for Mr. Andre) moved: 
The Acting Speaker (Mr. Turner):: It is presumed that motion No. 2 will not be proceeded with as it is identical to motion No. 1 which has just been put. Is that agreed?


Some hon. Members:: Agreed.


The Acting Speaker (Mr. Turner):: It is so ordered.


Marcel Joseph Aimé Lambert: Mr. Speaker, the purpose of this amendment, which is to amend clause 1 of the bill, is to carry out the declared view of the official opposition that the bill creating the office of comptroller general should define the duties of that office. On the other hand, the government, in its proposal, says the comptroller general, who is to be one of the watchdogs for parliament, is to have his or her duties defined by the Treasury Board. This, to my mind, is a total negation of the purpose of setting up the office. It is as though, when the office of Auditor General was set up, we were to provide that his duties be set by the Minister of Finance and that he should act through the Minister of Finance. That is no watchdog position. Frankly, the set up is simply mechanistic.
I have met the new Comptroller General. I have discussed certain matters with him at a meeting of the Standing Committee on Miscellaneous Estimates. I wanted to find out from him precisely what he thought his functions were.
If we turn to page 28.28 of the Blue Book on estimates we read the following as a description of the objective in mind when the office of comptroller general was proposed to be set up:
In accordance with the responsibility delegated by the Privy Council as set out in the Financial Administration Act to ensure the quality and integrity of Financial control systems and related administrative practice and procedures designed to operate after and within the authorization of the allocation of resources by the government and by parliament.
April 27, 1978

This, from the same page, is the program description:
Operations-Develops and ensures the effective application of financial administration legislation, policies, standards, systems and procedures to provide public assurance that the financial resources of the government are properly managed, controlled and accounted for.
-Develops policies to ensure that satisfactory procedures are established to
measure and report the efficiency and effectiveness of government programs.
Administration-The Office of the Comptroller General; financial, personnel and administrative services.
In other words, the office and the role of the comptroller general are mechanistic. They are to ensure that proper controls will be established. That is a mechanical operation. It is not, as set out, under Evaluation and Planning in the program description of the Treasury Board-
-undertake in-depth policy analysis and program evaluation related to the major sectors of the economy; provide economic briefings; collaborate with other federal departments and agencies in medium term planning and evaluation studies; provide research and analytical support to the other branches of the secretariat; and administer ... grants as listed in the estimates.
In the amendment, which stands in the name of my hon. friend, we have put in precisely those functions which have been described in the estimates. The only thing is, the description in the estimates can be changed from year to year. In other words, parliament has no control over it. Unless it is contained in a statute so that everyone can see, that will continue to be the position. The statutes have far wider coverage than the estimates. Apart from a few parliamentarians and public servants, there is hardly anyone in this country who knows his way around this book. And it is in this book, the Blue Book of estimates for the year 1978-79, that the duties of the comptroller general are designated. Treasury Board, in its wisdom, can, in the preparation of the estimates for 1979-80, change those duties around by 180 degrees-and who would be wiser? Certainly not the public. It is this to which we object.
The office of comptroller general was set up by a government which was dragged, kicking and scrambling, through the door, because of representations made, not once, not twice, but at least three times by the Auditor General, and in the face of continued criticism from the opposition. As a result, we get this grudging, half-hearted measure. This is not the way to go about it, Mr. Speaker. I have no objection whatsoever to the definition of the duties of the comptroller general as outlined in the estimates book because they are parallel to those we have provided in our amendment to the bill. But there is an important difference. Under the terms of the amendment his duties would be defined by statute to be seen by all and they would not be subject to change except by an amendment to the bill which would require debate in parliament.
If this man is to be a watchdog on behalf of parlament, then parliament should set his duties, not Treasury Board. I think I can assure you, Mr. Speaker, that in the event of a change in government this, too, will be an undertaking: we shall see that the duties of the comptroller general are enshrined in the Financial Administration Act.
This morning I had a further opportunity of discussing with the new Comptroller General a subject which I have taken up
Financial Administration Act
at various times with a number of deputy ministers during the examination of estimates. I believe I have had a clear exchange of views with the President of the Treasury Board (Mr. Andras), with the Minister of Finance (Mr. Chretien), and with the deputy minister of finance and, now, with the Comptroller General.
I am interested in increasing the effectiveness of members by making available to them many of the reports to which I referred when I was outlining the program description of the central administration of the public service program at Treasury Board. It says, and I quote:
On the basis of the analysis of departmental plans and programs to recommend to the Government the acceptance or modification of specific expenditure proposals in order to:
-reflect the priorities which the government assigns to the objectives;
-increase the effectiveness of existing and proposed programs;
-increase the efficiency with which the manpower, facilities, equipment, materials and supplies are used in the operation of programs;...
And ultimately to develop the estimates for the approval of parliament. I am asking that the reports which are made at that time be made available to members of parliament and to heads of departments so that if there are mistakes in one particular area, or problems to solve, the solutions or the proposals to solve those problems will be available to other sectors of the government and to members of parliament who are asked to pass on close to $50 billion in estimates.
Based on what information are members of parliament asked to pass on these estimates? It is difficult even for one who is well versed in the Blue Book to understand what is really happening, and it becomes far worse when we consider that on the average a minister will appear not more than about three times, for an hour and a half at the most each time, to answer questions about the administration and the policies of his department and the spending programs which are outlined in the Blue Book. Let us consider the small amount of time that is available to each member to question ministers and, of course, the time used to answer his questions is his time.
To top off this nonsensical program we have, the same committees have to consider legislation which comes their way. The Standing Committee on Labour, Manpower and Immigration has yet to begin its examination of estimates because there have been two or three bills kicking around. The chairman is in no hurry to get to the examination of estimates. And what is coming? Either an election or May 31, whichever comes first. What is coming is a guillotine. I do not want to operate under the threat of a guillotine when examining estimates.
The general summary shows that total budgetary items amount to precisely $46,476,469,179. That is almost as good as Loto Canada. In addition to that, total non-budgetary items amount to $2,255,546,092. That is a total of nearly $50 billion, and the amount of time available for the examination of estimates is very little. A member must depend upon his own acumen, or that of his researcher, to go digging and to ask for information or detail at a committee meeting because the

April 27, 1978
Financial Administration Act
estimates are in omnibus form. If a member wants any particular detail, it may be filed at a subsequent meeting if it is not available when first requested. The net result is that remarkably little information is brought out, and absolutely nothing is available to members from either side of the House.
The estimates are equally important to members on either side of the House. It is not a case of them against us, or of members of parliament against public servants. Public servants do not sit in the witness chairs behind six-foot fences with their heads up above waiting for us to shy coconuts at them, but one almost gets the feeling that they are afraid to say anything because we might criticize them.
Most things the government does are for the benefit of the people. There are some things one might perhaps do differently, and some things are wrong-headed to start with, but that is the essence of a human being. We are not perfect. Human programs are not perfect either but, goodness gracious, would it not be far better if assessment reports or evaluation reports based upon zero budgeting were available to hon. members in this House? Our work on estimates would be not only more pleasant but also immeasurably more intelligent.
I have not been here as long as the hon. member for Winnipeg North Centre (Mr. Knowles), but I have spent 20 years looking at estimates, and I think I would match my knowledge with his when it comes to getting around the Blue Book. However, I feel a sense of personal insufficiency when I try to discuss intelligently with able public servants the philosophies of programs or their effectiveness. Are they over the hill? Should we terminate them in the foreseeable future? How should they be amended, if they need to be? If we could deal with these matters more effectively, we, as members of parliament, could function much better.
I discussed this with the Comptroller General. That was the nature of the discussion I had with him in the brief time that I was able to question him. I spent most of my time stating my philosophy in this regard. I think the Comptroller General was very well disposed to the idea.
I anticipate being back in this House after the next election, either on this side or on the side opposite, and I can tell hon. members that I will continue to press and press for the presentation of these reports. My colleague, the hon. member for Peace River (Mr. Baldwin), is conducting a campaign on the right to know. Well, this is part of it. I think members of parliament have not only the right, but the duty, to know on what they are basing their judgment in order to accept, modify, or reject the government's spending programs outlined in the estimates.
I hope that after two years' experience we will be able to assess better the role of the comptroller general and the rules or the guidelines under which he operates, and that we will be ever vigilant, because I know the government will not accept this amendment, to ensure that the duties are not changed to suit the government's temporary views should the reports of the comptroller general prove embarrassing. We remember the

time some four or five years ago when certain government ministers really wanted to move in on the auditor general-not the present one but his predecessor-because he dared to criticize bad government programs and their bad administration. To his credit, the present Auditor General took up the cudgels with regard to the administration of programs and the financial controls, and this has culminated in the creation of the office of the comptroller general.
I had hoped that in committee and at the present time the government would have been disposed to accept the amendment of my colleague, the hon. member for Calgary Centre (Mr. Andre), because I think it makes eminent sense. But even if amendments make eminent sense, there is a strange disposition in this placefor the government to close its mind to opposition amendments. I hope that, if there is a turnabout, that bad habit will not apply, but I have seen it. It is a sort of malady around here. I think it is part of our system. I know that in the British system ministers are much more inclined to accept amendments in committee. Their position is not quite so fixed. It is not as though by accepting an amendment you confess a weakness. It is just that perhaps somebody has a better way of expressing the same ideas, or perhaps a little more strongly.
I had hoped that the government could have seen fit to accept this amendment, but it does not. So I hope that I have exposed this problem-and certainly this amendment has served me with a vehicle to put forward my views with regrard to making available evaluation reports on government programs from the Treasury Board and the comptroller general.
I will close these remarks with a plea that even now the government should accept this amendment. Strangely enough, the ministers responsible for this bill are not the House.


Mr. Lefebvre:: I am.


Marcel Joseph Aimé Lambert: The parliamentary secretary is present, but unfortunately he cannot determine government policy, and even though he might be the man most disposed in the House to accept my arguments in favour of the amendment, he cannot do anything about it. Seeing that the parliamentary secretary is in charge of the debate at this stage, it is quite clear that the government has closed its mind to accepting any amendment. That is a real pity. With that, I think, we will call it a day on this amendment, but I hope that hon. members will remember much of what I have said this afternoon.


Thomas Lefebvre: Mr. Speaker, the hon. member for Edmonton West (Mr. Lambert) has repeated essentially the same arguments that had been made previously on this bill in describing the duties of the comptroller general. They had been answered by the President of the Treasury Board (Mr. Andras) and by myself many times, both in the House during debate and at the committee hearings which were held to study Bill C-10. I do not intend to repeat them again, and I wish to refer any member interested in the office of the
April 27, 1978

comptroller general to acquire copies of the proceedings and evidence of the Standing Committee on Miscellaneous Estimates, issues Nos. 7, 8 and 9, where all the answers were given in great detail in reply to the arguments put forth here today and previously.
Also, this morning-and this was mentioned by the hon. member for Edmonton West-Mr. Rogers himself, the new Comptroller General, appeared before the committee and once again answered in great detail questions which were put to him. Unfortunately, as the hon. member himself mentioned, because of the conflict of having to attend another committee, the hon. member was able to be present at the meeting of that committee for only a few minutes, although we did give him time to put forward his own philosophy, as he mentioned. Had he been able to attend the full committee hearing this morning, he would have found that Mr. Rogers feels in no way restricted and has studied the committee hearings, as he revealed in a direct answer to a question I myself asked him, and has also studied the 20 recommendations which were tabled in the committee on March 21. If the hon. member has not read them, I would commend them to him. They describe fully and in detail in 20 paragraphs the comptroller general's responsibilities and duties.


Marcel Joseph Aimé Lambert: They can be changed so easily.


Thomas Lefebvre: They were tabled on March 21. I do not know if the hon. member has been able to study them.
I do not intend to prolong this debate, Mr. Speaker. The Comptroller General is in effect on duty now. He started his work on April 1. He has come from the private sector with excellent recommendations and he has held any number of important positions before taking on his duties as comptroller general. We all know he has made a personal sacrifice in accepting this position. There is no doubt as to his capabilities, his integrity, or the way in which he has handled himself in his previous positions.
I think we should terminate this debate. The government has no intention of accepting this amendment. This has been stated before regarding similar amendments in the committee. I recommend that this amendment be turned aside and that we proceed to third reading of the bill and final passage, so as to give Mr. Rogers the full co-operation of this House to carry out his duties, which all parties believe are very important, and to establish a system of even more effective control of the taxpayers' money.


Mr. Gordon Towers (Red Deer):: Mr. Speaker, certainly it is a pleasure to rise and speak on this amendment. I hope that in the last few days of this session of parliament-


Mr. Kaplan:: Mr. Speaker, I rise on a point of order. A number of members are finding it too cold in the chamber. Could you have the temperature raised?
Financial Administration Act


The Acting Speaker (Mr. Turner):: Order, please. I have already spoken to the House of Commons staff and they are doing something about the temperature right now.


Thomas Gordon Towers: Perhaps if the hon. member got involved in the political process he might get warmed up, and then he would not feel the chill in the air.
Actually we have been disappointed because the government has not been more receptive to suggestions made. Generally speaking, in the Standing Committee on Public Accounts, there has been little political manoeuvring, which speaks well of the hon. members who serve on that committee. I have participated in that committee for a number of years, and certainly it is a pleasure to witness how that committee has been changed. A number of years ago, that committee dealt with issues which were considerably in the past. We have steadily progressed to the point where hon. members can deal with the Auditor General's report shortly after the time of its presentation before the House of Commons.
Further to that, the chairman of that committee deserves a certain amount of credit, if not a great deal. It speaks well of parliament that the chairman was chosen from the opposition. Perhaps this is one reason why the committee has worked as well as it has.
We had hoped the majority would see fit to accept some of the amendments which have been presented. I do not doubt the veracity and sincerity of hon. members on the government side. Quite often good suggestions are made by members of all parties. The Auditor General and the Comptroller General require all possible assistance, if public spending is to be brought under control. There is no way for Canada to survive, if the deficit remains at $10 billion or $11 billion, which has been the case in two successive years. Unfortunately, this has occurred in what can be construed to be relatively good times. What will happen when the going gets tough and the economy goes into a doldrum? What will we do then? This is why it is important for the House to give the Comptroller General all the support which is possible. I am sure the Comptroller General has a certain amount of wonderment as to what the future holds for him. Undoubtedly he requires the support of all members, along with the support of the Auditor General.
I should like to refer to the Report of the Auditor General for the fiscal year ended March 31, 1977. At page 6, clause 2.3, he recommended the following:
... first, the establishment of the position of chief financial officer of the Government, preferably with the title of Comptroller General of Canada;...
Fortunately this has been fulfilled.
His second recommendation reads as follows:
... second, the appointment to this position of a person with appropriate professional qualifications, with a proven record of outstanding competence and achievement at senior levels of responsibility, and with extensive experience as a senior financial executive in a large-scale organization in either the public or private sector;...

April 27, 1978
Financial Administration Act
To all intents and purposes this has been achieved. We believe the qualifications of Mr. Rogers will measure up to our expectations. His final recommendation reads as follows:
... third, the appointment in each department, agency and Crown corporation of a senior financial officer, preferably designated as the Comptroller (in combination, if appropriate, with another designation such as Assistant Deputy Minister in departments or Vice-President in Crown corporations), who would be directly responsible to the deputy head or chief executive officer for all aspects of financial administration within his organization and who would possess the professional and personal qualifications and senior financial executive experience that are commensurate with his important responsibilities.
He went on to say:
... that implementation of these recommendations would lay the essential foundation of a soundly-conceived program for restoring effective control over public funds and assets, and for ensuring probity, prudence and economy in their management. I was confident that the government, parliament and, indeed, all taxpaying Canadians would subscribe to these objectives.
We subscribe to these objectives. If the Comptroller General is to achieve that, certainly he requires the support of all hon. members of parliament, all members of the senior executive within departments, and also the willingness of executives in Crown corporations to work with him. Crown corporations must co-operate with the new Comptroller General.
The Export Development Corporation bill receive second reading today. That corporation is one of many Crown corporations which have concerned taxpayers. The National Capital Commission is another Crown corporation found lacking in financial management and control. The Department of Indian Affairs and Northern Development will require a tremendous amount of effort in order for it to be brought under control. I hope all departmental officials, including deputy ministers and ministers, will make sure that no obstacles are placed in the pathway of this new official of the Government and Parliament of Canada.
The office of comptroller general is of fundamental importance to the survival of all Canadians. If he does not receive cooperation, the result will be a mess from which there is no return. I trust everyone will support him in the best possible manner.


Walter David Baker: Mr. Speaker, a few moments ago the hon. member for Scarborough East (Mr. O'Conneli) was in the House. Not too long ago he made some comments regarding the difficulties with which we in parliament are faced in respect of government expenditures. I am happy he joined with us to review the expenditures of government. Both of us have made suggestions to improve and rectify this matter. I am sure he and other hon. members are concerned by what appeared not too long ago in the most infamous of all Auditor General reports. It was the second to last one which gave rise to the whole movement and pressure in this House of Commons to appoint a comptroller general. The bill which arose from that report contained so much bad news and offered such a straightforward solution that it sent many people scurrying for cover.

You will recall, Mr. Speaker, that when the government finally decided that the time had come for it to accede to the demands for a comptroller general, we received a bill. The unfortunate part about the bill is that it merely calls for the appointment of the comptroller general. I have no quarrel with that.
I thank the hon. member for Edmonton West (Mr. Lambert) for handing me the bill. It states:
The Governor in Council may appoint an officer called the Comptroller General of Canada to hold office during pleasure and to perform such duties and functions as may be assigned to him by the Treasury Board, and the Comptroller General of Canada shall rank as and have all the powers of a deputy head of a department.
That principle is acceptable to all sides of the House, but what I am concerned about, as, I am sure are all members of the House, including the hon. member for Scarborough East, who has taken such a great interest in this, is that at the outset, whereas every major officer in the hierarchy of government has his duties and scope of authority spelled out for him in legislation, the comptroller general alone is left without that kind of control or that kind of support that the terms of reference set out in a statute could mean for him. That is why the hon. member for Calgary Centre (Mr. Andre) has put forth the motion that is before the House today, to give to the comptroller general specific statutory authority so he knows where he stands. Otherwise he will be bumped and buffeted by the government from place to place or priority to priority as things change, and must change from time to time.
I know that the Auditor General would want more for his creature, the Comptroller General of Canada-because in that sense he is. I am sure that he would not inform the House that he was dissatisfied completely with this. I am sure that that is the case, as the hon. member for Gatineau has mentioned, but I am sure he would agree that it would be best if we start off on the right foot. Let us start off on the basis on which no one who thinks about our financial proceedings in this House could argue that the comptroller general is best left to the whims of the government, but instead should be like all other officials who have terms of reference spelled out for them. I mean that not in the sense of the treasury bench, but in the sense that his colleagues all have other deputy heads and senior officials in their department. That is the purpose of it.
As the opposition in the House of Commons or during an election, we constantly reiterate the need to reduce government expenditures. This is not because we hate to see money wasted but because we are concerned about the immediate dangers of inflation and the long-term implications of public spending dominating the economy and overshadowing the economic forces which ultimately supply the country's wealth. The reply that we always receive is, "Well, would you like us to eliminate family allowances or pensions, starve babies, or throw widows out into the snow drifts?" We never get an admission-


Stanley Howard Knowles: Would you fire deputy ministers?
April 27, 1978


Walter David Baker: -from the government that money leaks out of the system at a ridiculous rate. It is always the challenge that cannot be met by any but an army of accountants. Now, of course, the army of accountants has reported to the general staff in the Auditor General's report, and that general staff happens to be the Parliament of Canada.
It is important, as we consider this amendment, that we understand the source of the problem. First, there will always be problems of cost control in organizations with goals other than the accumulation of a profit and with security of tenure as a necessary feature to prevent politically-motivated staffing. Prior to 1969 wasteful proclivities were kept at a reasonable level by the partnership of the comptroller of the treasury and the Auditor General. The former watched the funds as they went out, and the Auditor General scrutinized the accounts to make sure moneys at all levels were spent productively and in the manner authorized by parliament. The comptroller general was part of the administrative structure. The Auditor General reported to parliament, and his report was discussed in detail by the public accounts committee, as it is now. In response to a number of real and suspected problems, the Diefenbaker government in 1960 set up the Royal Commission on Government Organization, known as the Glassco commission. One of its several terms of reference was to suggest means of:
-improving efficiency and economy by alterations in the relations between government departments and agencies, on the one hand, and the Treasury Board and other central control or service agencies of the government on the other-
The commission's response to this challenge may be found in summary at pages 120 to 124 of Volume I. It was suggested that many of the functions performed by the comptroller of the treasury should be decentralized to the departments and that the comptroller should henceforth be called the accountant general, reflecting important but narrower responsibilities. As was said at the time, "removal of the administrative details which now swamp the board and frustrate departmental management will undoubtedly enable the board to discharge its important responsibilities more effectively."
I note that it is quite close to five o'clock, Mr. Speaker. May I call it five o'clock, sir?



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Ethier):: It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Vegreville (Mr. Mazankowski)-Transport-Government acceptance of recommendations of Snavely Commission; the hon. member for Kootenay West (Mr. Brisco)-Indian Affairs-Withholding of funds from National
Post Office
Indian Brotherhood; the hon. member for Provencher (Mr. Epp)-Agriculture-Price of herbicides-Steps to assist farmers.
It being five o'clock, the House will now proceed to the consideration of private members' business as listed on today's order paper, namely, notices of motions (papers).


PRIVATE MEMBERS' MOTIONS FOR PAPERS
Yvon Pinard: Mr. Speaker, I ask for the unanimous consent of the House to proceed with notice of motion No. 53 and that all previous motions be allowed to stand.


The Acting Speaker (Mr. Ethier):: Order. Is there unanimous consent?


Some hon. Members:: Agreed.


LEGAL OPINION ON POSTAL RATE INCREASES
Hon. W. G. Dinsdale (Brandon-Souris) moved:: That an order of the House do issue for a copy of the legal opinion concerning the legality of the latest postal rate increases, given by the Department of Justice to the Post Office Department.
He said: This motion, Mr. Speaker, is one of a series that I have moved in recent months in an attempt to pry information out of this most secretive of all governments. In every case the government's reply has been to the effect that the information, if revealed, would not be in the public interest. I submit right at the outset of my remarks this afternoon that it would be very much in the public's interest if some of the internal antics of the present administration could be revealed in the documentation that I have been endeavouring to obtain by the only method that is available to members of the opposition, the motion that is before the House.
[DOT] (U02)
Through this specific motion, No. 53, which calls for the tabling of the legal opinion behind which the government hides in refusing to explain its refusal to proceed legally in increasing postal rates, we have an opportunity once again to bring a vitally important issue before the House of Commons, that is, the current sad and deteriorating state of the postal service in Canada. Everyone agrees, the public, management, labour, and even the government, that the Post Office is in deep trouble.
Ten years ago Canada had one of the best post office departments in the world. I specifically state ten years ago because that was the beginning of the perilous progress and

April 27, 1978
Post Office
peregrinations of the present administration. We had delivery service six days a week. We had a first-class postal rate of five cents. The service was fast, reliable, and reasonably economical. The Glassco Royal Commission, which investigated in depth government organization just prior to this time, gave the Post Office Department high marks for efficiency. In fact it was one of the few departments of government which escaped unscathed many criticisms made by the Glassco Royal Commission. Now, unhappily and tragically, because Canadian well-being and national unity depend upon a reliable, responsible, efficient, and reasonably cheap postal service, horror stories abound.
The Post Office Department has become the butt of jokes from coast to coast. I am sure hon. members agree that when people start laughing at a department it is in deep distress indeed. Stories are heard with reference to the now rather regular postal increases. The public is not paying for a service, it is paying for storage, and with each increase in rates the service deteriorates further. Hand in hand with the remarkable perversity of the increasing postal rates, there has been a steady cutback in service. Some of the cutbacks have been ridiculous, beyond understanding and comprehension to common sense.
Almost every day we hear complaints made by members from all sides of the House that the Post Office is cutting back in its door to door delivery service. The only explanation given is that the Post Office Department cannot afford to deliver mail from door to door. On the other hand, in the United Kingdom the post office is increasing its door to door delivery service. The postal service in the United Kingdom is compelled by law and regulations, not only to deliver even in the rural areas to a post box perhaps at the end of the road, but it must put mail right in the slot of the householder's door. Canada is reducing that kind of service.
One of the most ridiculous cutbacks came to my attention recently. The Post Office Department made a decision, if you can believe it, Mr. Speaker, to remove telephones from rural post offices. This was a cutback to save money. This takes us back to the pre-Thomas Edison and the pre-Alexander Graham Bell era of communications. Of course the Post Office is in the communications business. How they can justify a cutback in this kind of service to save money is beyond understanding, as I say. This is especially so in rural areas because the rural areas, more than any other part of the Canadian body politic, require reliable and speedy communications, particularly if we are to arrest the decline in our rural communities. This decline has been going on for the past two decades with increasing speed. The rural population is moving to the city and the rural communities are folding up because of the decline in services of this kind.
The decline of the family farm is involved in this situation, and yet the Post Office Department which is operated by the Government of Canada aggravates the situation by removing telephones from the rural post offices. I say that if they want to make savings in this way, service should be discontinued

completely. If that were done there would be an absolute saving in expenditure on the part of the government.
Many people have come to the conclusion, including post masters general who move in and out of the department so fast that they can hardly catch their breath, that, if drastic action is not taken soon, the Post Office could collapse in its own incompetence. This is why I am pleased to have the opportunity to bring these matters to the attention of the House again this afternoon.
The government is not coming to grips with this urgent problem. The only action the Post Office Department has taken, in the last ten years, and I think this is fair criticism, has been to change post masters general so frequently that it has become a game of musical chairs. Nobody knows who is responsible for what from the standpoint of the government. Rates are raised constantly. Ministers opposite used to change rates legally, but now they are doing it illegally. This is the point I want to stress this afternoon.
The Post Office used to operate legally. This goes back to the days to which I referred of ten years ago, when the Post Office at that time was one of the most efficient departments with the most efficient services of any in the world. In the past decade the government has decided, and this is a part of a general move toward secrecy and refusal to take parliament into the confidence of the government, to increase rates, and rather than do so under Section 10 of the Post Office Act, which clearly outlines that it is the obligation under that act, it has decided to do it by the illegal procedure of order in council under the Financial Administration Act.
Another aspect which needs to be mentioned is that the increases in the rates have not been subject to the restrictions of the Anti-Inflation Board. The postal rate has soared from five cents in 1968 to 14 cents in 1978. That is one decade of Liberal administration. Notwithstanding constant increases in the postal rate, the deficit has increased from $60 million in 1968 to almost $600 million in 1978. Where are we heading? Why the government does not take action in the face of these dramatic figures is impossible for an ordinary person to understand.
Not only has the cost of service gone up from five cents to 14 cents, but hidden in the deficit is an increase of $1 in taxation for every $1 of expenditure for service. Therefore, the actual cost of a first class postage stamp today is 28 cents.
The government does everything in its power to frustrate parliament's opportunity to come to grips with this situation. There is a secrecy in the government that is almost paranoid. Today the Prime Minister (Mr. Trudeau) is almost afraid to call an election, indicating paranoia in that direction. He is afraid to face the electorate.
The motto of the government has become power, patronage, and perpetuity. That is the only explanation I can arrive at. My friend across the way is smiling. He will be smiling on the other side of his face when an election is called. The people are fed up with that sort of nonsense, paranoid secrecy, and refusal
April 27, 1978

to deal with a fundamental issue like this. This issue affects every person in Canada because the mail comes to every doorstep almost every day. This will be heard loud and clear when we are finally allowed to get out on the hustings.
Getting to the legality of the situation, every postmaster general has agreed that they are operating illegally when they increase rates other than by amending the Post Office Act. I could read Section 10, but I am not going to waste my time reading sections of the act. When the Minister of State for Urban Affairs (Mr. Ouellet) was Postmaster General, he agreed that in order to increase postal rates you must amend the act. This was agreed by every Postmaster General right down to the Solicitor General (Mr. Blais) when he was Postmaster General.
That opinion has been strongly supported in two successive reports of the Joint Committee of both Houses on Statutory Instruments and Regulations, condemning the government for operating outside its legal rights and, in particular, for avoiding its responsibility to parliament. Just the other day there was unanimous concurrence with this viewpoint from the House of Commons when the fourth report of the standing committee was concurred in unanimously in this House.
More significant from the standpoint of the government's tendency toward paranoia is the view expressed in this House the other day by the Minister of Justice (Mr. Basford). That is recorded in Hansard for April 21. He stated that the present and past Postmasters General have acted on the advice of the Department of Justice and that the use of Section 13 of the Financial Administration Act is a proper and valid use of that section. In other words, the Minister of Justice advised successive Postmasters General, and there have been six in seven years, to break the law as it is laid down in Section 10 of the Post Office Act.
I can understand why the Minister of Justice has decided to leave politics. If this became an issue in his constituency in the city of Vancouver, B.C., he would not have a hope of re-election. The Minister of Justice advised Postmasters General to break the law so that a parliamentary discussion on post office affairs could be avoided. He deliberately circumvented the rights and responsibilities of members of parliament on all sides of this House.
This was underlined recently by the attitude of the Postmaster General (Mr. Lamontagne). He came into the position quite unexpectedly early in the new year because of the vacancy that had occurred in the Solicitor General's portfolio. When the Solicitor General was Postmaster General, he indicated in a parliamentary committee that he would be moving to bring in amendments to the Post Office Act to legalize what had been done illegally. The present Postmaster General, who was only elected last fall, does not agree that what is being done is illegal. He was specifically asked in this House on April 18 by the hon. member for Peace River (Mr. Baldwin) whether he accepts the viewpoint of the committee on statutory instruments that what he is doing is illegal. The minister replied as follows:
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Mr. Speaker, I must say that the postal rates have been increased legally, as I have already indicated to the House, and we have no intention of changing our present way of doing things.
Obviously he is adamant. It will be up to the people of Canada to change the present way of doing things, and this I am sure they are going to do as soon as the Prime Minister can screw up his courage to dissolve and call the long overdue election.
There has been a deathbed repentance on the part of the government in recent days, all geared to the exigencies of the election call. They introduced, and it was approved by this House, Bill C-45 which outlaws the right to strike in the Post Office during an election. That goes back on the right that was established by a Liberal government in 1967.
An announcement was made outside the House that the Post Office Department was at long last going to accept a recommendation that had repeatedly been made in the House by the opposition. If action had been taken earlier we might have come to grips with some of the problems that have caused such a tragic state of affairs in the Post Office. Outside the House, the Postmaster General and the Minister of Labour (Mr. Munro) announced there would be a study on the advisability of transforming the Post Office Department into a Crown corporation and that the report must be in by July 15. Obviously that was political expediency of the deepest kind to coincide with what was anticipated then would be the call of an early summer election. However, we are still shrouded in secrecy. For this reason the hon. member for Peace River has been calling for a freedom of information act that would open the secret operations of the government to parliamentary and public scrutiny.


The Acting Speaker (Mr. Ethier):: Order. I regret to interrupt the hon. member but his time has expired. He may continue, however, by unanimous consent.


Some hon. Members:: Agreed.


Walter Gilbert Dinsdale: I am just about to conclude. I had this nicely timed. Post Office customers, and this is the strangest anomaly of all, have been alienated. Because of the recent action of the Postmaster General in increasing rates illegally, major users of the service such as the periodical publishers have taken the department to court. The Supreme Court of Ontario will be ruling on the matter in due course. But I would think that in the light of events just around the corner the real verdict will be expressed by the people of Canada through the ballot boxes, and I am optimistic about what the result will be.


Stanley Howard Knowles: Mr. Speaker, I rise to express strong support for this motion. I do so as one who is consistent, because I have supported motions similar to this in years gone by. That leads me to a bit of history which I should like to relate to the House in a minute or two.
The motion calls for the tabling of an opinion of the Department of Justice which was apparently given to the Post

April 27, 1978
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Office Department to the effect that it is legal to raise the postal rate from 12 cents to 14 cents under the provisions of Section 13 of the Financial Administration Act rather than by amending the Post Office Act and giving parliament the chance to say yes or no.
The wording of Section 13 is such that I do not see how any Department of Justice official or anyone who has respect for law can say it gives the governor in council the right to raise postage rates without bringing a measure before parliament. The section reads in part as follows:
13. Where a service or the use of a facility is provided by Her Majesty to any person and the Governor in Council is of opinion that the whole or part of the cost of providing the service or the use of the facility should be borne by the person to whom it is provided, the Governor in Council, on the recommendation of the Treasury Board, may
(a) subject to the provisions of any Act relating to that service or the use of
that facility, by regulation prescribe the fee or charge to be paid by the person
to whom the service or the use of the facility is provided.
The section goes on to a paragraph (b) which says more or less that same thing except that in certain circumstances it can be done by a minister. The first part says it can be done by order in council, and the second says it can be done by a minister.
Surely the section from which I have read is there for use in case of an emergency, for cases in which, for example, certain services were being provided free of charge and it is thought a fee should be imposed. The postal service is not something new in Canada. It is not something which is logically subject to emergency consideration. After all, Canadians were already paying 12 cents before this order in council was passed to raise the rate to 14 cents. It seems to me the method employed by the government is a blatant abuse of the provisions of Section 13 of the Financial Administration Act.


An hon. Member:: That is what the committee said.


Stanley Howard Knowles: Yes, Mr. Speaker, that is what the committee on statutory instruments said. And anyone with any respect for the law would surely agree that the action the government has taken is an abuse of the section of the Financial Administration Act to which I have referred. This being the case, I believe the motion before us should be passed and that we should be able to read what the Department of Justice had to say in justification of the action taken by the Post Office Department.
I said I would ask your indulgence for a moment or two, Mr. Speaker, while I related a bit of history. Sometimes we in the New Democratic Party do not like being the third party in the House; we would prefer to be the second party or the first. But one of the advantages of being the third party is that we can look objectively at the other two and see how alike they are. I remember that six days after the election of 1962-the election was held on Monday, June 18-I was sitting in my home in Winnipeg watching the television news. Who should come on but the Prime Minister of Canada, the right hon. member for Prince Albert (Mr. Diefenbaker), to tell us that because of serious economic conditions which had developed during the campaign certain steps had to be taken.


An hon. Member:: That was the floating dollar.


Stanley Howard Knowles: We had dollar problems and all sorts of problems which somehow did not surface during the campaign. But something had to be done. So what did the then Prime Minister announce on June 24? It was to the effect that there was to be a 15 per cent increase in customs duties on a whole range of products. Well, I had been mixed up in things around here for a long time, and I sat in my room and thought: that is impossible. The Prime Minister, I thought, cannot amend the Customs Tariff by order in council.


Walter Gilbert Dinsdale: It had been done before.


Stanley Howard Knowles: Don't give me that line. Doug Abbott did announce by radio certain increases which would come into effect subject to a vote in parliament, but these increases were to come into effect immediately. How did the prime minister and the government of the day achieve this?


Walter Gilbert Dinsdale: Doug Abbott-


Stanley Howard Knowles: Just a moment. You are not going to get out of this by referring to Doug Abbott. This is what the Tories did. They did it by an order in council based in part on the Financial Administration Act and partly on the Customs Tariff itself. You see, under the Customs Tariff there are three different columns-the general tariff, the most favoured nation tariff, and the British preferential tariff. And though the Customs Tariff does not give the government the right to change rates it does give the government the right by order in council to move certain products from one of those columns to another. When this is done, of course, rates are changed. The trouble was that the extent of the change in such cases was too great.
The effect of moving products from one column to another was to increase the rates by 25 per cent or 30 per cent. The government wanted to increase the rates by only 15 per cent. So it made use of a double-barrelled order in council. It said, "Under the provisions of the Customs Tariff certain items will be moved from one column to another, then, by virtue of a provision in the Financial Administration Act which gives the government the right to remit any fee which a person has paid, the tariffs which have been thus increased by 25 per cent or 30 per cent will be reduced again to 15 per cent." It was ingenious, if not devious. At any rate, it went into effect.
Some time later in 1962 parliament reassembled and this was one of the first things we began to talk about. We in the NDP raised the issue, and so did the Liberals in those days. Oh, they were hot about this subject. This was a denial of the rights of parliament, and so on, they kept telling us. Well, the government secured a ruling from the Department of Justice that the action it had taken was legal and appropriate. When I moved that that ruling be tabled, I got no further than my friend is getting with his motion today. Oh, the government did not need to table the ruling. We had to take not only the
April 27, 1978

word of the then prime minister but also the word of the then minister of finance.


Walter Gilbert Dinsdale: We have learned from experience, Stanley.


Stanley Howard Knowles: Just a minute. My friend is not going to get out of this by this kind of thing. The prime minister of the day and the then minister of finance, the late Hon. George Nowlan, father of an hon. member who is still with us, said that they had the ruling of the Department of Justice that it did not need be tabled, that the matter did not need to be referred to the courts and that it was perfectly all right. We fought that through the 1962-63 session and got nowhere. In particular, we got nowhere with a motion like this one asking that the opinion be tabled. In 1963 there was an election, and things got turned around. When it was all over, the Tories were on the opposition side and the Liberals on the government side.
Hon. members will remember that in the 1962-63 session the Liberals said that this kind of order in council was all wrong and should not have been allowed. In the meantime, some big companies in this country which were affected rather severely by those 15 per cent tariff changes took the matter to the courts, and it became obvious that they had a good case, that they were going to win and that it would be clear that the order in council was ultra vires the rights of the cabinet.
So what did the Liberal government do with this faux pas that the Tory government had made the year before? It got a ruling from the Department of Justice, the same Department of Justice with some of the same senior public servants in it. They were not fired back and forth the way it is being talked about today. They got a ruling from the same people saying that the order in council which was passed in June of 1962 was invalid. We tried late in 1963, to get out of the Liberals of that day a copy of that opinion of the Department of Justice, but we could not get it from them either.
I am afraid this has some effect on my respect for Department of Justice rulings. Any government can get from the Department of Justice any ruling it wants because in 1963 the Tories got the ruling that its order in council was valid. In late 1963 or on into 1964 the Liberals got from the same Department of Justice the ruling that that order in council had been invalid. What did the Liberals do to take care of the situation? I would have thought, since they were so opposed to what had been done, that they would cancel the whole thing and rebate the increased duties; but no, they brought in a special act of parliament to validate the order in council which they themselves had argued the year before was invalid. As a member of the third party my reaction in both cases, whichever party was in power, was to try to get the opinion of the Department of Justice. But we were not able to get it, either when it said the order in council was valid or when it said it was invalid.
My friend the hon. member for Brandon-Souris (Mr. Dinsdale) can relax a little bit now. We have got over the history of the past. We should learn something from that history. What
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we should learn from that history is that these things ought not to kept secret.
I think it was wrong for the Tories in 1963 not to let us see what the Department of Justice said. I think it was wrong for the Liberals in 1963 or 1964 not to let us see what the Department of Justice said the other way.


Walter Gilbert Dinsdale: We need a freedom of information act.


Stanley Howard Knowles: I think it is wrong for the present government to refuse to let us see what the Department of Justice has said regarding the action of raising the postage rate from 12 cents to 14 cents on the basis of an order in council passed under the Financial Administration Act. I am satisfied that the courts would find this invalid, just as they would have found that order of 1962 to be invalid.
However, that is a long way down the road, and how could we ever rebate to the people of Canada the extra postage they have paid? It just cannot be done. But in the meantime the issue today is not so much the history I have recited and not so much all of the faults and shortcomings of the Post Office Department which my hon. friend has recited, but our right to know the basis on which these decisions are made. My guess is that the reason the government does not want to table this opinion of the Department of Justice is that every lawyer in the place would be shocked by it. Any Department of Justice official who said that it is right under section 13 of the Financial Administration Act to raise postage rates by order in council would clearly be laughed at.
If I can carry my history forward a little and be speculative-back in that other instance there was a change of government-I will go this far and say that if there happened to be a change of government in the election about to be held, and if the Conservatives formed a government, they could go to the Department of Justice saying "We did not like that ruling," and get from the Department of Justice a ruling reversing the one obtained by the Liberal government. That is all the more reason why we should have these things brought out and put on the table so that we know what is going on behind the scenes.
The hon. member for Brandon-Souris made reference to the hon. member for Peace River (Mr. Baldwin) and his campaign for freedom of information and the right to know. He is absolutely right, and that is really what is at stake here. I agree that related to all this is the whole question of postal service, what is happening to that service, whether it was right to raise the postage rate and so forth, but the fundamental issue is the right of parliament to say whether or not it should be raised.
When the rights of parliament are set aside by a ludicrous ruling from the Department of Justice, an opinion which says that the government can act without coming before parliament, we ought to have all the facts, and therefore I strongly support this motion. I feel that the stupid opinion which the Department of Justice has given in this matter should see the light of day, and the passing of this motion would bring it before us. That is why I support the motion.

April 27, 1978
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Roger Carl Young: Mr. Speaker, I will leave it to my hon. colleagues to point out some of the necessities for raising the postal rates and some of the requirements and conditions which existed at the time.
At the outset I would like to say to the hon. member for Winnipeg North Centre (Mr. Knowles), who has just spoken, that differences in legal opinions are what keep lawyers in business, and those same differences in legal opinions are what keep us as members of parliament at work trying to keep lawyers in business.
The hon. member for Brandon-Souris (Mr. Dinsdale) called the increase an illegal one. I do not know upon what opinion or advice he relies, but I do not share that opinion. I do not believe that the committee report in which we concurred last week claimed that the increase was illegal. I think the words of the committee were to the effect that its members had grave doubts as to the validity of relying on the general power in section 13 of the Financial Administration Act. The committee is entitled to its opinion or decision, but it is one thing to express grave doubts and another for the hon. member for Brandon-Souris to twist that and say that the increase was illegal. They are two quite different things.
The hon. member went on to say that everyone says the increase was illegal. I have not heard that. I should also point out that the concurrence of the House in that report does not affect the validity of those postal increases at all. The hon. member for Winnipeg North Centre read part of section 13(b) of the Financial Administration Act. He read through the "legalese", if I may put it that way, of the section. Perhaps I could read that section to hon. members without using as much legalese and try to put it into what might be considered somewhat plainer English. Section 13(b) of the Financial Administration Act refers to charges for services or use of facilities. It states that the governor in council, on the recommendation of the Treasury Board, notwithstanding the provisions of any act-and I would stress that-relating to that service or use, may authorize the appropriate minister to proscribe the fee or charge to be paid by the person to whom the service or the use of the facility is provided. On that basis, some legal advice was given.
Turning now to the reason we are debating this motion this afternoon, let me point out that it arises out of a request by the hon. member for Brandon-Souris last October 26 which reads as follows:
That an order of the House do issue for a copy of the legal opinion concerning the legality of the latest postal rate increases, given by the Department of Justice to the Post Office Department.
At that time my answer to the hon. member, on behalf of the minister, was that legal advice provided by the law officers of the Crown on a matter of state policy falls within the class of confidential documents, and on that basis I asked if he would withdraw his motion. He chose not to withdraw the

motion, and that is the reason we are here debating the subject matter this afternoon.
I should like to expand upon the answer that was given to the hon. member for Brandon-Souris at that time. Advice given to ministers by law officers of the Crown on government policy matters has traditionally been regarded as confidential. On March 15, 1973 the then president of the privy council, pursuant to Standing Order 41(2), tabled in the House of Commons an outline of the government's position with regard to notices of motion for the production of papers. That outline was printed as an appendix to Hansard of that date and appears at page 2288. It reads in part as follows, under the heading "General Principle":
To enable members of parliament to secure factual information about the operations of government to carry out their parliamentary duties and to make public as much factual information as possible consistent with effective administration, the protection of the security of the state, rights to privacy and other such matters, government papers, documents and consultant reports should be produced on notice of motion for the production of papers unless falling within the categories outlined below in which case an exemption is to be claimed from production.
Immediately following, under the heading "Exemptions" is found the following:
The following criteria are to be applied in determining if government papers or documents should be exempt from production:
1. Legal opinion or advice provided for the use of the government.
The hon. member for Brandon-Souris and the hon. member for Winnipeg North Centre are well aware-they have been in the House a long time and they know-of the long standing procedure and precedents which the government is following in giving the answer it first gave to the request for the order to the hon. member for Brandon-Souris, and I know the hon. members will understand the point I am making now with regard to in-house legal opinions held by the government and given by officers of the Crown to ministers.
Were documents containing legal opinions or advice subject to compulsory disclosure, the free expression or candour that is essential to the proper conduct of the affairs of the government would be seriously curtailed and the performance of the duties of the advising ministers of the Crown on questions of law would be inhibited.
If one looked for a moment to the private world outside this chamber, one would see that there has always existed a privileged relationship between a solicitor and a client, and those legal communications, solicitor-client communications, have always been accepted as being sacrosanct. We are in an analogous situation but in a government in-house circumstance. That advice which is being requested to be brought forward publicly is advice from public servants on which ministers of the Crown rely, and it would be a serious curtailment of the abilities of public service employees to fully express themselves when assisting the government to carry out the duties and functions of various departments.
The Department of Justice was consulted almost two years before the rates were increased and the opinion was that it was legal to increase the postal rates by virtue of section 13 of the Financial Administration Act, to which I referred earlier. I am
April 27, 1978

not going to comment at any length on the committee report which was concurred in last week. As the hon. member for Brandon-Souris pointed out, if the matter has not yet been brought before the courts, it is my understanding that it may be soon.


Walter Gilbert Dinsdale: It is before the Ontario Supreme Court now.


Roger Carl Young: I have been informed by the hon. member that it is before the courts. In that case, for me to comment further would be wrong since, I take it, the matter is sub judice.


Stanley Howard Knowles: Don't give us that.


Roger Carl Young: It is generally taken that one does not comment on matters which are before the court. If the postal rates are being challenged-and I gather a challenge may be coming from the Periodical Publishers' Association-I think we will await the advice of the court and the decision of the very able people who sit on the bench. I am quite prepared to leave it to the court to make that decision.
In closing my remarks tonight let me remind the House that the hon. member for Brandon-Souris spoke about the service performed by the Post Office today. We have all heard the stories and humorous anecdotes about that service, and I am sure that on some occasion or other we may all have been looking for a letter which might have taken a day or two longer to arrive. Some people these days are fond of trying to compare the Post Office to the pony express. I want to point out to the hon. member for Brandon-Souris, because I see him smiling, that I came across an interesting fact and some interesting figures some weeks ago. At the time when the pony express operated-I believe it was at the turn of the century; I am not quite that old to remember that far back, but perhaps the hon. member for Winnipeg North Centre might help me there-


Stanley Howard Knowles: At the turn of which century?


Roger Carl Young: I took it the hon. member was referring to the most recent century. I heard that it cost about $25 to send a letter by pony express from one side of the continent to the other, and it could take anywhere from three weeks to a month for the letter to reach its destination. If that is true, I think that some of the humorous anecdotes do not describe the situation sufficiently accurately. I would like to ask that those who bandy about those stories should also compare the value of $25 at that time to what it is today. Would it be $75 to $100 in today's monetary terms? I do not know exactly. For that same letter to go through the Canadian postal system, as some six billion letters do, crossing six time zones, we pay 14 cents for a first class letter.


Walter Gilbert Dinsdale: It is 28 cents including the deficit.


Roger Carl Young: Well, it is 14 cents for the person who buys the stamp. I suppose we all share in the deficit.
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I will conclude at this point in order for some of my colleagues to expand further on the recent rate increase.


Hon. Martin O'Connell (Scarborough East):: Mr. Speaker, the hon. Parliamentary Secretary to the Minister of Justice and Attorney General of Canada (Mr. Young) set out the position of the government very well. Further debate in the House is not likely to produce many results regarding the legality or alleged illegality of the postal rate increase. The government received advice. The matter is now before the courts. No useful purpose will be served by continuing the debate on the legal issue. Personally I believe the government had the legal right to do what it did.
The public is less interested in the postal rate increase to 14 cents, since it is not out of line with the rates charged in other countries. They are really interested, however, in the service the Post Office is able to deliver at this stage of its development. Many of us are as concerned as the public with the quality of this service.
The Post Office is a federal institution which is facing a crisis. It is not difficult to understand why that is so; this federal institution has had a long history of neglect by the public and particularly by governments. That neglect was overcome in the last ten years or less. The Post Office in fact has gone through a massive transformation which has resulted in inside turmoil and difficulties in its service to the public.
Approximately ten years ago, collective bargaining came to the Post Office, as it did to other federal institutions within the public service. I am referring to the Post Office as an institution which employs one out of every five public servants. In fact, the Post Office has some 63,000 employees. It is a massive institution into which the collective bargaining procedure was introduced for the first time. At the time collective bargaining was introduced, the working conditions in the Post Office were poor, the wages were exceptionally low, and a military style of administration and management existed, if I can put it that way. Therefore, one would expect that employees would use collective bargaining to better their positions. They were perfectly entitled to do so.
Also, the facilities of the Post Office have been starved of capital for decades by successive governments. Not only were the working conditions poor inside those facilities, but the facilities themselves were poor and employees could not cope with them because of the millions of pieces of mail they were expected to deliver. Thus, service was breaking down, and morale and working conditions were poor.
The transformation is still going on at the present time. A new postal code was introduced. Industrialization was introduced into the operations of the Post Office. Also, mechanization on a massive scale was experienced. For example, there are three letter mechanized sorting plants in Toronto and other parts of the country today. Anyone who goes into one of those plants will appreciate that people are no longer handling the mail. Instead, machines are handling it. The work force has been industrialized to that extent. Thus, a major changeover in

April 27, 1978
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working conditions and psychology has occurred. It is still not easy to work in a modern Post Office facility.
It is important for us to know that the system can remain difficult, even with mechanization. If one goes into the Scarborough letter sorting plant, one will see a group of coders sitting in a row behind what appear to be typewriters. The letters go down a moving belt. That belt stops for four or five seconds, at which time the typist is required to copy the postal code from the envelope, and the code reappears on the envelope in the form of yellow bars. The future progress of the letter is controlled by an automatic and mechanized process based on yellow bars. The typist is required to read the postal code which is on the envelope, type it within a few seconds, and then switch attention to the next envelope which appears before her immediately. This process is repeated and repeated automatically and the postal coder becomes a part of the machine. One must agree that even though the working conditions have been mechanized and improved, they are difficult to adapt to and live with. The psychological and emotional strains of working in the mechanized Post Office are still very considerable.
Of course there will be breakdowns. For example, if the postal coder looks at the code on the envelope very quickly and misreads M1E 1E2 as N1E 1E2, the letter will end up in London, Ontario, rather than Toronto. It may require ten days to recover that letter. There are many management and systems problems still to be worked out. These are the kinds of questions which should be in front of us because they affect service.
It was for these reasons that I asked for the establishment of a special parliamentary committee to inquire into our postal service and the host of problems associated with the transformation that is occurring. Many of those problems are management problems and not problems caused by rate increases.
I will give another example. At any given time the Post Office is not aware of where bags of mail are, even though it seems to think so. The railways know where their boxcars are because the sides of the boxcars are coloured and numbered for computer reference. If a bag of mail goes astray, however, the employees at the Post Office do not know whether it is in Kitchener, Vancouver or wherever, because no such tracing mechanism exists. This is why the public will remain concerned about slow delivery.


The Acting Speaker (Mr. Ethier):: Order, please. The hour provided for the consideration of private members' business having expired, I do now leave the chair until 8 p.m.
At six o'clock the House took recess. [DOT]


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
(Mr. O'Connell.]


[Stage Direction]
The House resumed consideration of Bill C-10, to amend the Financial Administration Act, as reported (without amendment) from the Standing Committee on Miscellaneous Estimates, and motion No. 1 (Mr. Lambert (Edmonton West) (for Mr. Andre)).
Walter David Baker: Mr. Speaker, before the adjournment I was recounting for the House the history of the Glassco commission, its purposes, what it hoped to achieve, why the change was necessary and the recommendations that were felt required. The major reason for the change was the fact that the comptroller was responsible for details of financial control, but he could not avoid the administrative details which were not to be his chief concern. In other words, he found himself in a difficult position. In fact, the history of the time would reveal that he found the work overwhelming, and the departments of government resented the interference of the then comptroller arrangement.
The new arrangement that was proposed was to sift out the administrative detail at the departmental level and to leave the nuts and bolts of the accounts to the accountant general. The system was sound on paper, and it may very well have been in practice if all its components had been set in motion. Unfortunately, this did not happen. The financial control was moved to the departments; Treasury Board assumed greater responsibility for financial management, and in 1969 the position of the comptroller of the treasury was abolished.
Two vital mistakes were made. Firstly, the decentralization of financial control to the departments was not made to financial officials but to senior officials who already carried a burden for policy creation and administration; or on the other hand it was made to junior financial officials who did not carry sufficient weight in their departments to keep financial priorities in the forefront of decision making. Secondly, the comptroller general's position was dropped, but no accountant general was appointed to replace him as had been recommended by the Glassco Commission. Instead, the Treasury Board tried to do everything.
You were here, Mr. Speaker, then. I have only read about this in the history of this department, but during that period of time the Treasury Board assumed responsibility for negotiations with the public service, who at that time had acquired the right to strike; it was given the responsibility for the bilingualism program; and it became increasingly important in setting the priorities of the government because of its increased responsibility for financial control. In this regard it seemed to be challenging the finance department for the final political say
April 27, 1978

in allocating financial resources to departments for their priority programs.
As it grew, it seemed to pay less effective attention to its Glassco inspired functions-to keep a firm watch not only on the purpose for which money is allocated, but the manner in which it is spent. The report in 1975 of the Auditor General, which landed like a bombshell in this parliament when it was tabled, was a direct result of this failure to follow those recommendations. Then, in came the Auditor General.
Everyone in this House will recall Mr. Macdonell. Everyone in this House waits and has waited for years with gleeful anticipation for the Auditor General's report, and I think that some of my friends on the other side said that after Maxwell Henderson, Mr. Macdonell would be some kind of an auditor pussycat.


Mr. MacFarlane:: You said that, we didn't. We said he would be brilliant; he's a Scot.


Walter David Baker: He put the case perfectly in the public accounts, and I want to quote it for edification of the chief government whip because I am sure it will do him the world of good. He said about the financial management of the government which the government whip supports so gleefully:
The present state of the financial management and control systems of departments and agencies of the Government of Canada is significantly below acceptable standards of quality and executives.
That was quite a judgment for the quiet Mr. Macdonell to make, and quite a judgment for an organization which at that time had supervision over the expenditure of $34 million for the year ending March, 1976.
In dealing with Crown corporations and other adjuncts of the government, Mr. Macdonell said:
In the majority of the Crown corporations audited by the Auditor General, financial management and control is weak and ineffective. Moreover, co-ordination and guidance by control government agencies of financial management and control practices in the Crown corporations are virtually non-existent.
If the first was a strong comment on financial management procedures with respect to financial control and Crown corporations, this was an indictment of the management of the government. Mr. Macdonell chose his language with great care and great precision when he said in his report that the financial control system of the government was grossly inadequate.
It was against that background that when we asked for the appointment of a comptroller general by the Government of Canada they indicated that they felt it was not necessary, thereby flying in the face of the Auditor General. Then when the Auditor General's report sunk home in the minds of the Canadian people-and I suppose ministers of the Crown began getting the same mail from their constituents as members of parliament-they did not advance the argument about there being no need for a comptroller general. Instead, the government fell back on the argument that they had to investigate whether this would interfere with ministerial responsibility and the relationship of the ministry to parliament.
Financial Administration Act
That was the first time that I had ever heard any member of the government concern himself greatly about the issue of ministerial responsibility. It seems in the last little while they have not dealt with ministerial responsibility at all. In fact, in the mind of the Prime Minister (Mr. Trudeau) it has been something that should be avoided especially when it is embarrassing, and sometimes I am led to believe that they substitute the doctrine of ministerial ignorance for ministerial responsibility. Nonetheless, that is the argument that they advanced. It was not until the eleventh hour, when they were belaboured by the public and perhaps by their own conscience, that one day in this House of Commons there was the dramatic announcement: "We are going to have a comptroller general." Some would have called it a deathbed conversion. If it had been made today it would be a deathbed conversion. They went on to say: "A distinguished Canadian has been appointed Comptroller General of Canada, and he has his place in the scheme of things as established by Bill C-10".
As I said at the outset, it is very important that we clothe that official with sufficient statutory authority that he knows where he stands. We must give him some authority which can stand with ministerial whim so we do not see a repetition of the practice of government by order in council, government by regulation, government by guideline, all of which gives tremendous power to the executive and removes from parliament the power to set the guidelines that ought to be in an agency responsible for an aspect of government which is eventually reported to parliament.
This amendment has not been advanced to cripple the Comptroller General in any way. It is to give him solidity in the scheme of things, to lay out certain statutory responsibilities that we know he has, that he knows he has, that the government knows he has, that his brother deputy ministers in the public service know he has and that the public know he has, so that he, parliament and the rest of us can make judgments in the appropriate way. That is the purpose of the amendment and why I support the hon. member for Edmonton West (Mr. Lambert) who before we adjourned said that we have to go much beyond that.
Treasury Board does a tremendous amount of evaluation and planning of government programs which should be referred to parliament. The objective of the amendment is to strengthen the office of the comptroller general and to put into the hands of the comptroller general the knowledge and the tools by which he can more effectively do his job, so that he and we know that there is the machinery available to look after the interests of the citizens of the country. That is the purpose of the amendment and I invite the House to support it.


Mr. Dan McKenzie (Winnipeg South Centre):: I welcome the opportunity, Mr. Speaker, to speak on this bill. It is through the insistence of the members on this side that we have a large part to play in why the government has finally come around to creating a comptroller general position. Actually if the President of the Treasury Board (Mr. Andras) and the Minister of Finance (Mr. Chretien) were doing their job, we would not need a comptroller general.
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April 27, 1978
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One cannot help but wonder if this comptroller general office that is being established is nothing but window dressing. If one looks back to 1970, this government introduced a bill to reduce the powers of the Auditor General, but thanks to the insistence and filibustering by members on this side that bill had to be withdrawn. The last thing this government wants is someone examining what it is doing. We will find out in time whether the Comptroller General will be able to do his job. When we form the government after the next election we will make sure that he has all the powers to carry out his duties, Mr. Speaker. How irresponsible can this government, which is now spending $1 billion more a month than it is taking in, get?
Perhaps the Canadian people would like to know just exactly what it is going to cost them to operate the Comptroller General's department. Initially Treasury Board estimated a total expenditure of $4.9 million and 124 man-years to run the office of the Comptroller General. Even they realize that they need a large department to keep track of what this outfit is doing. This includes $1.9 million of new spending and 35 new man-years. Another $3 million and 89 man-years comes from a transfer from the Treasury Board secretariat. The financial administration branch and the efficiency evaluation branch of the Treasury Board secretariat are being transferred to the office of the Comptroller General. So one can see that because the President of the Treasury Board cannot control expenditures and the Minister of Finance cannot control expenditures, the Canadian taxpayers will now have to pay almost $5 million to establish another department to keep track of what this government is doing.
I would like the Comptroller General to examine why the CBC had six units standing west of the main block for the last two weeks with a whole crew of technicians and truck drivers. There were six large mobile units sitting there waiting for the election to be called. Well, we are not going to have the election, Mr. Speaker, because the vans are being pulled away. I guess the Prime Minister (Mr. Trudeau) has notified the CBC that there will be no election. From information that I have obtained I understand that for approximately the last two weeks it has cost the Canadian taxpayers $1,200 an hour to have these six vans sitting there. This just shows the games this government plays and the cost of the games which the Prime Minister plays for this parliament and for the Canadian taxpayer. Tonight there are two vans left. We will find out tomorrow whether they will be pulled away, and that will be an indication of whether or not there will be an election this fall. I will try to get the total cost of having those six vans parked outside for the last two weeks.
I would like to quote from a recent article which appeared in the Ottawa Journal. It is written by W. A. Wilson who has summed up this cabinet's performance in an excellent way. It is headed "Trudeau cabinet incredibly careless". I do not need Mr. Wilson to tell me that; all of us are aware of it. In this particular article he states:

The sensational aspects of the public accounts committee's investigation of nuclear sales abroad, the suspicion that payments were made for corrupt and illegal purposes, inevitably will secure the most public and political attention.
The new Comptroller General will certainly have his work cut out for him. What a challenge it will be to keep track of this government and what they are doing. Over the last ten years this group has spent $235 billion of taxpayers' money. All they have reduced from that $235 billion is $20,000. So that gives a clear indication of the disrespect this government has for Canadian taxpayers.
For another example I would like to quote from Hansard for November 26, 1976, some comments made by the hon. member for Crowfoot (Mr. Horner). These comments are in regard to the Government Expenditures Restraint Act which we were discussing at that time. The hon. member for Crowfoot stated:
Mr. Speaker, in rising to resume debate on Bill C-19 I would refer to my remarks of last night when I said there is a shocking lack of planning by this government, particularly in the Department of Transport.
The hon. member for Crowfoot is now overlooking all this irresponsible spending and he is sitting on the other side with the rest of them. He goes on to say:
There are heavy lay-offs in the steel industry, but no plans are advanced on how to assist the regions faced with these lay-offs which come as a result of lack of orders from railway companies
And on and on he goes. How could any responsible person join a government which operates in that manner? The member for Crowfoot goes on to say:
I have read of the problems in the Department of Transport. In fact, I read a very revealing statement. The Minister of Transport (Mr. Lang) said that no additional airports would be built in Canada without consulting the airlines. That is an admission that when Mirabel was built, the airlines were not consulted with regard to the kind of terminal facilities they wanted.
How is the Comptroller General going to deal with the political pay-offs and political decisions which are how this government operates? Will he be able to stop their political decisions and pay-offs? Not very likely. The new Comptroller General will be in a most frustrated position when he deals with this government.
The hon. member for Crowfoot goes on to say:
When talking to the former president of Air Canada, he informed me that he was not consulted about the public transit vehicles used between the terminal and the airport. In fact, when he was told that the system would be at Mirabel, he informed the government that it was a very costly and wasteful system.
As if that would concern them. It most certainly would not. I do not know how the Comptroller General will deal with a situation like this. The hon. member for Crowfoot went on to point out:
Many members of parliament and the press have been making hay with regard to the Minister of Transport's abuse of the public trust placed in him, with his exorbitant travelling costs. He stated in all seriousness that he had to fly to Calgary a year ago for the Grey Cup game in order to represent the Minister of National Health and Welfare (Mr. Lalonde).
How will the comptroller deal with these JetStars? The minister from Crowfoot now flies around in one of these JetStars. He was the one who was so critical about this matter and was the one who revealed the Minister of Transport's travelling costs, which were three quarters of a million dollars
April 27, 1978

then and will be up to at least $1 million now. He is continuing to use the Jet Stars every weekend and so is the minister from Crowfoot. How will the Comptroller General control this? The government has no intention of setting an example of controlling expenditures. They never fooled me, Mr. Speaker, and they will not fool the Canadian people again.
In talking on this restraint bill the minister from Crowfoot said:
The bill before the House suggests that the government is going to curtail expenditures.
The minister from Crowfoot went on to point out that they have no intention of doing any such thing. He is now part of this particular government and will operate in the same manner.
What is the Comptroller General going to do about a government that gives low interest loans to communist countries? These communist countries have the money to fight wars around the world; a prime example is Cuba. There are 45,000 Cuban troops in Africa now. We found out in 1975 that CIDA was trying to conceal the amount of loans to Cuba. They wanted to give a no-interest loan but apparently somebody over on the government side had a little bit of conscience and so they settled for 3 per cent. We are pouring millions of dollars into a communist country which has all kinds of money to fight wars. What is the Comptroller General going to do in a situation like that?
I wish to refer to a former finance minister, and we have had many of those. This particular one is Mr. Turner. When he inaugurated the current spending restraint program in the budget of June 23, 1975, at that time the main estimates had received the approval of parliament. They forecast budgetary spending of $32.2 billion. The main estimates for 1979 forecast budgetary spending of $46.5 billion. Thus during the three years of the restraint program, the main estimates of budgetary spending have increased by $14.3 billion, or 44 per cent. That is why I am so suspicious of this legislation to set up a comptroller general office. In fact, I do not trust the government. Their statements mean absolutely nothing.
I wish to refer to a statement made by the Prime Minister on August 13, 1969. He stated over television that we would have to control expenditures. He said we would be on the way to financial disaster if nothing were done to bring spending under control. He further stated that to spend vast sums on welfare, education and other programs while allowing inflation to continue would merely place hundreds of thousands of Canadians on a treadmill they could not escape. Since the Pnme Minister made that statement, government spending has increased by 410 per cent to over $35 billion. How can we possibly have any faith in the office of comptroller general? We will have to support it and hope that it works, but I believe it is nothing but window dressing.
The President of the Treasury Board stated that federal spending will rise by 9.8 per cent in fiscal 1979. This figure is suspect, but even if it is accepted, a 9.8 per cent increase in
Financial Administration Act
spending is hardly evidence of restraint. It goes on and on. Today we received a press release from the Information Division of the Department of Finance. In it the Minister of Finance announced:
Canada and the Deutsche Bank have reached an agreement for a private placement in Germany of 1.5 billion Deutsche Marks. The Deutsche Bank is a major commercial bank in the Federal Republic of Germany. It managed the private placement of DM notes issued by Canada in 1968.
All we hear from day to day is that the government are going to borrow more and more money. Where is the control? How is the Comptroller General going to control this? Today Canadian taxpayers have to pay $6.5 billion a year in interest on the money they are borrowing. We are borrowing money abroad to pay interest on money we borrowed abroad. How irresponsible can they get? What amazes me are the backbenchers, who sit opposite supporting this. They have no conscience. They have no respect for the taxpayer. It is unbelievable. Yet the government say they are going to control federal spending.
I say tonight that federal spending will increase at a faster rate in 1979 than it did in 1978. Total federal outlays are expected to increase by 8.3 per cent in fiscal 1978. The administration expects outlays to increase by 9.8 per cent in 1979. I do not understand how the Comptroller General can accept this challenge he is taking on. Maybe he does not know the facts. I do not think he knows what he is stepping into. He is being led down the garden path.
Another large item of inflexible expenditures is the interest and servicing costs of the public debt, which I have just covered. Primarily due to the large deficits tolerated by the present administration, debt charges have increased by 82 per cent since the 1976 main estimates. An increase of that magnitude during a restraint program indicates that this administration sees no connection between restraint and living within one's means. In more human terms, the increase in debt charges over the life of the restraint program, 1976 to 1979, works out to an increase of $215 per person employed, from a level of $382 in the 1976 main estimates to $597 in 1979. Public debt charges will become more burdensome in the future, as the present administration continues to tolerate sustained large deficits.
I do not know how the Comptroller General will deal with a government that allows the following kinds of expenditures under the Canada Council. This shows the disrespect they have for the Canadian people and their tax dollars. Here are some examples of how they hand out Canadian taxpayers' money. The council gave out $8,000 for an illustrated glossary of household objects in New France. We have five million Canadians living below the poverty line, yet they hand out $8,000 to somebody who does not want to work so he can study something like this.
Another one is $5,275 for research on themes taken from Apocalypse in the work of Russian "Symbolist" writers. How on earth can an elected official tolerate handing out taxpayers' dollars for such hairbraine.l schemes? Only a Liberal government could do that.
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April 27, 1978
Financial Administration Act
Then we have $14,345 for psychological research on the effect of foreknowledge on human reaction. What on earth does that mean? We then come to $9,502 to continue research on the psychology of individual behaviour in the face of unavoidable events. Every day we face unbelievable events in this House with this government, which is an absolute disaster. Next we have $8,000 for research on African psychological studies and their implications for traditional psychological theory. It is unbelievable!
I have three stars beside the next one, which is $43,000 to continue research in Vancouver and Winnipeg on how individuals are influenced to take an active role in politics. I can speak for Manitoba. They are taking an active role in that province. My fund raiser is a former Liberal. The people who operate my constituency office, a couple who have donated their services, are former Liberals. I have had former Liberals come to my office in Ottawa and say "Dan, we have had enough. We have seen the light and are joining the Conservative party." They say they will support us and do everything they can to get rid of this outfit across the way.


Jack Sydney George (Bud) Cullen: Hallelujah, Brother Dan!


A. Daniel McKenzie: There will be a hallelujah for the hon. member from Sarnia. Maybe he will join us. The next one is $10,501 to prepare a critical edition of the complete works of the Mexican political pamphleteer, Pablo de Villavicencio, 1792-1832. I am sure the Canadian taxpayers will be sitting on the edge of their chairs with bated breath waiting for that report on what happened in 1792. The Liberals squander and throw around tax dollars and then sit back and laugh.
Here is a dandy, $19,900 to study population and social mobility in Huntingdonshire, England, in the fourteenth and fifteenth centuries. That is a top priority. Next, $13,240 to study reactions of infants to strangers and familiar adults. Oh, boy! Next, $3,600 to explore the motivational aspects of Western tragedy. We should be talking about the Canadian tragedy. Fifteen years of Canadian government is the biggest tragedy which ever happened to us. My God, at a time when 70 per cent of our people are never going to get into a home of their own we are squandering the taxpayers' money. I see that even the Speaker is getting a chuckle out of this, and he is a Liberal. I do not envy the Comptroller General. He will probably be taken away in a strait-jacket within a month after trying to deal with this group.
When he made his original growth forecast the Minister of Finance said he expected exports and consumer spending to lead the way to economic recovery. He forgot to say that this country is assisting the United States to recover through a serious outflow of capital and business to that country. People are bailing out because of the political climate created by this government. None of these make-work programs or appointments such as that of a comptroller general are going to keep them here.


Robert Hylton Brisco: Mr. Speaker, Bill C-10 takes up only one paragraph of writing, yet underlying that paragraph are a multitude of concerns, some of which have been expressed by the hon. member for Grenville-Carleton (Mr. Baker) and others more recently by the entertaining member for Winnipeg South Centre (Mr. McKenzie).
I am not at all surprised that my hon. friend succeeded in entertaining the House with some of the excerpts from the book he brought with him, "The Legacy of Spending", prepared by an incensed Canadian, a radio station commentator in Vancouver, a man who in all likelihood will seek the Conservative nomination in one of the lower mainland ridings, a man who daily discloses to Canadians in the lower mainland of British Columbia the kind of insensitivity, the kind of sheer thoughtlessness and idiocy which has been encouraged and allowed to continue by the present government. It makes no difference where you look, in what framework, department or Crown corporation, it is all there in this one book "The Legacy of Spending", a book which is enjoying massive sales across Canada, a book which is making a national impact, a book which will haunt the Liberal party. And so it should.
The time is long passed for the appointment of a Comptroller General. I echo the comment of my hon. friend: the man may be in a strait-jacket within a month when he is confronted with the irresponsible spending of some of these departments and Crown corporations. It is frustrating for a backbencher, and I have in mind particularly those who serve on the Standing Committee on Indian Affairs and Northern Development, to admit that for the past several weeks the Parliamentary Secretary to the Minister of Indian Affairs and Northern Development (Mr. Milne) has been periodically absent, that the minister himself has been almost consistently absent, and that the chairman of the standing committee has been absent for a protracted period. How is it possible for any member, myself included, even to ask the minister when he intends to summon up his courage and have his estimates brought before the committee?
I have made allegations in this House and also, without fear, outside this chamber with reference to the chaos in the auditing and in the management of that one ministry. Yet there has been no opportunity given us to examine and pursue these matters because the minister declines to bring his estimates before the standing committee.
Similar frustrations have been experienced by members serving on the Standing Committee on Labour, Manpower and Immigration. So in the final analysis, unless the ministers, the parliamentary secretaries and the chairmen of standing committees are prepared to demonstrate a measure of responsibility to parliament and to Canadians, our efforts, despite the appointment of a Comptroller General, go in vain.
Hopefully, outside this chamber there are Canadians who are prepared to demonstrate a measure of concern and who will express their concern at the polls. Nobody seems to care that the Department of Indian Affairs in one province alone is $12 million over its budget for a single fiscal year, 1976-77. How could one province be allowed to exceed its budget for

April 27, 1978

programs for 43,000 Indians in Saskatchewan by S12 million? How is it possible in the province of Ontario for somebody outside the department to accept money from Indian affairs, to put that money into a bank, to allow it to stay there for months gaining interest, and then to take the money out of the bank, put it where it was supposed to go in the first place and pocket the interest? We certainly need more than an Auditor General; we need a Comptroller General.
How is it possible that someone in the Department of Indian Affairs in a position of trust could arrange to have materials belonging to the department used in the construction of an apartment building in some other province, the stamp of the department being covered over with paint? Why is it that conduct of this kind is not answered for by the Minister of Indian Affairs and Northern Development (Mr. Faulkner)? Why is it apparently of no concern to his parliamentary secretary? Why is it totally ignored by the chairman of the Standing Committee on Indian Affairs and Northern Development? If things are that bad in one ministry, what are they like in others?
In the past year, Crown corporations have given us all cause for serious reflection. One of the classic cases is the affair involving Atomic Energy of Canada, Limited. If there was ever an urgent need for consistent standards of auditing public expenditure in the hands of Crown corporations, this is one outstanding example. Reading from the minutes and proceedings of the report of a sub-committee of the Public Accounts Committee on this matter, I note a letter from the judicial authority of Argentina. In this letter, which was sent to Canada through its ambassador, the Argentine attorney general's office had this to say-I am talking about the cozy little deal in which AECL took part:
(a)	The actual payment of 5,000,000 dollars to a presumed "commercial agent" has been established.
(b)	The commission was paid in equal parts by AECL and ITALIMPIANTI, for the apparent purpose of obtaining the award of the contract.
This, sir, is from the government of Argentina, written in Spanish and then translated.
(c)	ITALIMPIANTI advanced 300,000 dollars towards payment of the commission between the months of March and May of 1973, depositing the final balance of 1,000,000 dollars in the month of January 1975.
(d)	It has been possible to reconstruct the bank movement of these funds.
I am talking about Canadian tax dollars, not just the tax dollars of large corporations, businesses and industries. No wonder they are having problems surviving. The economy is a clear reflection of that. I am talking about the smelter worker in my home town and the pulpmill worker some 25 miles removed, in Castlegar. I am talking about the sawmill worker at Kootenay Forest Products in Nelson who has a wife, who has four children to raise and to put through school and who is working his backside off for five months out of twelve just to pay income taxes to this government so it can fritter them away and pour them down the drain.
(e)	The responsible Canadian officials ordered payment of the part corresponding to AECL, following instructions from ITALIMPIANTI.
Financial Administration Act
(f)	The Canadian parliamentarians were unable to ascertain the identity of the presumed "commercial agent", in spite of having brought in the Royal Canadian Mounted Police, who appear not to have obtained concrete results up to the present.
I would bet it was not without one hell of a fine effort at trying.
(g)	ITALIMPIANTI, which admits the intervention of the "agent", indicates that this latter was dispensed from issuing receipts or supporting documents and refuses to identify him.
(h)	For the most part, the funds which made up the presumed "commission"-
Five million dollars.
-were concentrated in a Swiss banking institution, using a coded account for this purpose.
That is a very familiar story. It does not matter whether it is AECL or the mafia, it is an intrusion into Canada's democratic system. It is a distortion of honesty. It is corruption of the lowest and highest order at one and the same time. It demonstrates skill in manipulating funds through Swiss bank accounts. It demonstrates the total insensitivity and uncaring attitude of the government. It demonstrates one of the reasons that the taxpayers of Canada are absolutely fed up with the nonsense which goes on in this government, and that will be reflected in the next federal election.
In that legacy of spending we see some shocking examples of the blunders of the Canada Council. If hon. members would care to read the minutes of the Canada Council appearance before the Standing Committee on Broadcasting, Films and Assistance to the Arts, they will find that when the hon. member for Fraser Valley West (Mr. Wenman) questioned a director from the Canada Council, he was told that in no way would he, the Secretary of State (Mr. Roberts), who is responsible for the Canada Council, or the standing committee have access to the reports and files indicating the manner in which the Canada Council was spending the taxpayers' dollars which this parliament gave to the Canada Council, totalling $64 million, so that somebody could write a poem, the title of which is so obscene that I cannot repeat it in this House. That is the kind of garbage we have to put up with. It is time hon. members on both sides of this House were provided with the authority to act against people who spend amounts of money like that in such an irresponsible fashion.
We do not need one comptroller general; we need a dozen of them and a half dozen auditors general to clean up this mess which is the legacy of the spending of this government, and that is just the top half. The hon. member for Winnipeg South Centre has said that when there is a change of government and the cans of worms are opened, the smell will fill this chamber.
One of the difficulties with this bill is that the provision for a comptroller general is in one simple paragraph. How can that be arranged? It will be arranged by regulation. God knows we have seen other bills pass through this House dealing with regulations. I can account for half a dozen bills about which the minister responsible has said "Trust me". We trusted them with Atomic Energy of Canada, Limited. We trusted them with the Canada Council. We trusted them with Polysar. We even trusted the Minister of Transport (Mr. COMMONS DEBATES
April 27, 1978
Financial Administration Act
Lang) to use some discretion when flying back and forth attending to the affairs and business of Canada.
It is a misplaced trust to allow a government to rule by regulation. The concerns referred to by the hon. member for Grenville-Carleton are very legitimate concerns. The bill should spell out what we expect of the Comptroller General. It should not be left to government regulation. Surely that lesson has been learned. Surely that concern has been advanced and repeated often enough. Surely it is not too much to ask, in the dying days of this parliament-if that is what these days are- that we address ourselves to spelling out what we expect from this man. Let us not hamstring him, but let us know.


Mr. Lloyd Francis (Ottawa West):: Mr. Speaker, I am pleased to support this bill, but I cannot support the amendments which have been suggested, and I would like to indicate my reasons.
The bill has its origins in the report of the Auditor General presented in the fall of 1976. Hon. members opposite have quoted in vivid detail from that report of the Auditor General, and the measures which have been taken subsequently to correct the deficiencies in the control of expenditures have been put on the record by hon. members on this side of the House.
I am sure every member in this House will agree that the reports brought down by the Public Accounts Committee and tabled in the House a matter of two weeks ago dealing with financial controls of Crown corporations, with Atomic Energy of Canada, Limited and with Polysar are the result of many hours of hard work by hon. members from both sides of the House. The committee conducted its business in a very fair and non-partisan way. It would have been a little more satisfactory to me if those who are declaiming so loudly the need to do something about government expenditures spent a little more time with the Public Accounts Committee.
I invite the hon. member for Winnipeg South Centre (Mr. McKenzie), who unfortunately is not here now, and the hon. member for Kootenay West (Mr. Brisco) to do so. The Public Accounts Committee is an instrument of this House which has tried to deal with the complaints which the Auditor General so very vividly described and to do something about them. The Auditor General pointed out that in the implementation of the Glassco commission recommendations we went from perhaps one extreme to the other. We had a position called comptroller general of the treasury, and it was abolished in the mid-1960's.
That position was a line position, a position which required a very centralized control of every dollar of expenditure. As the public service of Canada grew, as the expansion took place in those fabulous years in the 1960's, Mr. Glassco pointed out that some kind of decentralization was absolutely essential for the efficient management of the public service. In a nutshell, the philosophy of Mr. Glassco was: let the deputy ministers manage, let them be the bosses, free them from this highly centralized line control of the former auditor general, free

them from the centralized hiring policies of the Public Service Commission, let them have delegated authority to do their own hiring, and let them be responsible for their own spending.
In a way, the wheel turned full circle-we went to the other extreme. Now we see the re-establishment of a position called the Comptroller General, with significant differences from the previous post. This is not a line position, it is a staff position. The new Auditor General cannot directly control, but he can require systems to be set in place which will control expenditures under the direction of the deputy ministers, a very basic principle which must be recognized by those who are studying this legislation.
I sympathize with those hon. members who say that the Comptroller General's duties must be spelled out, and here we have amendments (a), (b), (c), (d), and (e) spelling out exactly what he must do. I invite hon. members to think for a moment. We have a position called the secretary of the Treasury Board who is responsible for many things. We have an Auditor General who has been given an act, recently passed by this parliament, stating that, among other things, the Auditor General will examine expenditures in order that they may be made with due regard for economy and efficiency, properly accepted accounting principles, and all the rest of it.
If the words sound familiar to hon. members opposite, let me tell them that they incorporate exactly the same words and phrases regarding the duties they are setting for this new position. It would call for the wisdom of Solomon to predict exactly what each is going to do. One thing is certain-the Auditor General is in the pre-eminent position. His duties do have a statutory base, his report must be laid before parliament according to the statute and it is automatically referred to the Public Accounts Committee. That is a treatment that no other agency of government has. No other individual in the public service of Canada has such a responsibility.
The Public Accounts Committee is a special committee whose chairman is chosen from the ranks of the official opposition and whose vice-chairman is a senior government spokesman. I happen to hold that position. The hon. member for Capilano (Mr. Huntington) has filled the job of chairman of the committee very ably, and I want to pay tribute to him for a very conscientious effort. But the facts are that the Comptroller General is in no such position. His report must go to his minister because he is at the deputy minister level; he does not have the statutory responsibility to report to parliament, and he is like another deputy minister of the Crown.
I invite hon. members on the other side to cite me any other deputy minister whose duties are prescribed to this degree, as the sponsors of these amendments would suggest, by statute. I invite them to cite one, because when they reflect about it they will realize that it is extremely important that there be no jurisdictional conflict between the Auditor General, the Comptroller General and the secretary of the Treasury Board. Their duties must be prescribed by regulation and in the normal way in which the duties of deputy ministers are set out and developed. Only the Auditor General can be chosen for the special treatment of a statutory responsibility because he has a
April 27, 1978

mechanism by which he reports in a very effective way directly to parliament.
I am sure that when hon. gentlemen and hon. ladies on the other side think about this matter they will realize that the pattern of the Auditor General Act cannot be repeated, that it would be a serious mistake to attempt to set out by statute duties which would involve a jurisdictional conflict, that an attempt to define the duties precisely would be self-defeating, and that the usual way by which the duties of a person of deputy minister rank are developed and described should be observed in this instance.
For this reason I will vote against the amendments, but I support the bill enthusiastically. I welcome it. I was delighted to have the opportunity to examine yesterday before the Standing Committee on Miscellaneous Estimates the incumbent who has just been appointed to the position. I wish him well, I congratulate him on assuming these duties at what must be something of a financial sacrifice for him, and I am sure the people of Canada will have reason to be grateful.


Some hon. Members:: Hear, hear!


Mr. Dean Whiteway (Selkirk):: Mr. Speaker, I appreciate the opportunity to speak on this bill. I heard a comment from the other side to the effect that they want to have our two cents worth. Well, let me point out to the Minister of Employment and Immigration (Mr. Cullen) that the Progressive Conservatives have already given the government our two cents worth, but I do not know whether the hon. member for Crowfoot (Mr. Horner) likes it over there. If they would get inflation under control, he might still be worth that much to them. If he is only worth half that much, it is only their fault.
We are debating tonight Bill C-10 to amend the Financial Administration Act. Before I get to the specific parts of the bill I want to pause for a minute to recognize the situation in which we find ourselves tonight on April 27. We recognized that back in November, 1976 the Auditor General pointed out in his report that the government had lost control of its spending and suggested that it was so serious that, if it continued, he would be unable to approve government accounts.
Why is it necessary for us to have a comptroller general? There are many reasons why we on this side see the necessity for such a position, why we will support this legislation and why my colleagues have submitted from this side some reasonable amendments based on sound judgment.
Let us look at the situation we have in Canada today as related to government spending. I would like to compare the figures of today with those of 1968 when this government came to power. Because it is the ten year legacy of spending by this government that caused the Auditor General, in November of 1976, to say that government spending is out of control.
When this government came to power in 1968 the rate of unemployment was 375,000; today it is 1,045,000. That is the official figure. The real figure is closer to 1,400,000. Ten years ago UIC benefits amounted to $438 million; today they are
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$4.5 billion. We are paying Canadians $4.5 billion not to work, not to be productive. When this government came to office, the rate of inflation was 4.5 per cent; today, with the world champion wrestler who has wrestled inflation to the ground, the rate of inflation stands at 8.7 per cent, double what it was ten years ago. When this government came to office, the CPI was 89.4 per cent; today, ten years later, it is 168.9 per cent.
When the government came into office, the trade balance was $3.1 billion; today it is $11.6 billion, which is four times greater. This is the legacy of spending which caused the Auditor General to say that government spending is out of control. When the government came into power, total spending was $10.9 billion; in this fiscal year it will be $41.1 billion, which is almost four times as much. If there was a reward for spending, the government would receive unquestionably the blue riband. The amount of money the government spent which it did not have or would not realize in revenues, at the time it came into office, was only $800 million; today that deficit is $9.2 billion. The government spends more today than what its total budget was when it came to power.
When the Trudeau government came into office, the budget of the Post Office was $67.2 million; today that deficit is $567 million. When the government came into power in 1968, the Post Office employed 36,000 people; today it employs 61,000 people. The number has doubled. If it doubles again, we will never get our mail. When the federal government came ito power, there were 236,000 employees in the federal public service; today it has 331,000 employees.
One would think the increase in staff which has occurred in the office of the Prime Minister (Mr. Trudeau) would result in their at least straightening him out, but obviously that has not happened. When the Prime Minister came into office one decade ago, there were eight people on his staff. Today there are 90 people, which is an increase of 82. That is the legacy of spending I am referring to.
I could refer to more figures that would indicate the increase in government spending. We are happy to be able to debate tonight whether Canada will have the benefit of a comptroller general. The government does not seem to accept the urgency of such a position. Two years ago the Auditor General pointed out that government spending was out of control. It took a year and a half for the government to put the legislation in place. It was introduced on March 8. I should like to indicate just how serious the government was about the creation of this position. Was it the President of the Treasury Board (Mr. Andras) who moved and spoke on this bill? No, it was not; it was his parliamentary secretary. If this position is as important as the government indicates, and if it is as important as members of the official opposition know it is, why did it take so long to get the bill? The Auditor General made his recommendations in 1976. The bill was introduced on March 8. Today is April 27, and we are on the eve of a federal election. Why did the government bring in legislation of such

April 27, 1978
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critical importance to Canadians and the workings of parliament at this time?
I believe Canadians will turf out this government and call upon the Progressive Conservative party and its leader to form the new government. We want the position of Comptroller General to be a position of authority, not simply a position of name. One of the deficiencies of this bill is the fact that it does not clearly set out the responsibilities.
In paragraph 2.15 of the 1976 report of the Auditor General, he clearly outlines what the responsibilities of the Comptroller General should be. On one hand, the government indicates it is following the recommendations of the Auditor General by creating the position of Comptroller General to somehow bring uncontrolled spending under control. Yet, his recommendations are accepted without putting teeth into the act as recommended by the Auditor General. One cannot have it both ways. Either what he says is accepted, or it is not. It is incredible that the government comes before parliament asking for support of a bill which is inconsistent with the recommendations of the Auditor General.
If hon. members opposite want to continue to defend this toothless bill, I ask them to look at paragraph 2.15 of the report, wherein the duties of the Comptroller General are spelled out clearly. The position of Comptroller General should be accountable to parliament, and his appointment should be referred to an appropriate standing committee. As was recommended by the Auditor General, he ought to be more than simply a deputy minister. His responsibilities must be clearly laid out.
I confess I do not know Mr. Harry Rogers; I understand he will be taking this position. I understand he is a man of some notable ability and credibility. I am looking forward to the expertise he will bring into this position. He comes to this position with the required enthusiasm and dedication. With the legacy of spending and the track record of this government, it is unfair for parliament to ask any man to take a position without legislation clearly spelling out his authority. I cannot emphasize enough the fact the Auditor General made specific recommendations as to what the responsibilities of that position should be. But this bill contains no specific responsibilities.
Quite frankly, I do not understand how government members can accept the Auditor General's suggestion to create this position and at the same time not support our amendments which were based on what the Auditor General suggested. I have the report in my hand, but I will not read it. It is well known to the government. I plead with the government to accept the amendments which stand in the name of the hon. member for Calgary Centre (Mr. Andre). As I have indicated before, the Auditor General suggested the establishment of the position of Comptroller General.


Cyril Lloyd Francis: But he did not indicate that it should be spelled out in the statute.


Dean Waldon Whiteway: Perhaps the hon. member for Ottawa West (Mr. Francis) missed my earlier remarks wherein I referred to
[Mr. Whiteway.l
paragraph 2.15 of the 1976 Auditor General's report. I stand on that. If we vote on this piece of legislation tonight, I appeal to government members to support our amendments. The legacy of spending of this government absolutely cries out for a responsible Comptroller General who will get government spending under control.
I am happy to say that when Mr. Harry Rogers takes that position it will only be a matter of months before the Progressive Conservative party under the leadership of the Leader of the Opposition (Mr. Clark) takes the reins of government, and we will help him do his job of getting government spending under control. We will make his job obsolete. Ministers in our government will make his job unnecessary. In the meantime, with the position this legislation will create, I would ask the government to support our amendments in order that we can follow the recommendation of the Attorney General by giving this legislation teeth and the position the responsibility it deserves.


James Aloysius McGrath: Mr. Speaker, one of the first things this government did when it took office ten years ago was to bring in major changes to the rules of the House. Those of us who were here at that time recall that debate very well. We remember that ironically those rule changes were put through by the invocation of closure.
It was the former auditor general in an article a few years ago who made the point that the take-off in government expenditures commenced at the time this government changed the rules of the House. What this government did to the House of Commons at that time was remove from this place parliament's ancient and traditional right to withhold or control supply and government expenditure.
There is not a member of this House who will not admit that the present system is just not working; it is not working in terms of an examination of the estimates and in terms of parliament having any control whatsoever of the government's purse strings. All we have to do is go to the standing committees of the House where the estimates are being examined. We will find in most cases, if not all, those standing committees which are now involved in what should be parliament's most important task, the scrutiny of government expenditures and holding the government accountable, cannot find a quorum. As a matter of fact, some of the committees cannot sit because there are not enough members there to go through the motion of hearing evidence.
My colleague says the fisheries committee this afternoon could not sit because there were not enough members. That committee was scheduled to sit today under the block system we now have by which a number of standing committees sit at the same time to examine the estimates. Members have lost interest. Interestingly enough, the press too have lost interest because this is a charade and a meaningless exercise.
Under the rules, which are no longer new, having been adopted in 1968, we took away from this place the right to
April 27, 1978

control supply. We put in rules which state that as of midnight at the end of May the estimates are deemed to have been reported to the House.
What does a minister have to do when he goes before a standing committee of the House with his estimates? All he has to do is turn up his collar and hang tough because he knows it is just a question of stonewalling long enough and his estimates will be passed anyway. What a stupid exercise. Is it any wonder we are faced with the situation today of having a bill before the House to set up the office of comptroller general, which arises from a report by the present Auditor General in 1976, and referred to in his 1977 report from which I quote as follows:
In my 1976 Annual Report, I wrote of my concern that Parliament-and indeed the Government-had lost, or was close to losing, effective control of the public purse. 1 said also that the full results of my Office's two-year study of financial management and control across Government had led me inescapably to the opinion that:
Based on the study of the systems of departments, agencies and Crown corporations audited by the Auditor General, financial management and control in the Government of Canada is grossly inadequate. Furthermore, it is likely to remain so until the Government takes strong, appropriate and effective measures to rectify this critically serious situation.
It is all well and good that we have this bill before us. Indeed, the government had no choice but to respond positively to the recommendations of the Auditor General and bring in this bill. I want to make this point, and we as a parliament should not lose sight of it, that the office of the Comptroller General of Canada will not be effective until we put our own house in order; until we change our own rules and until we get rid of this totally ineffective system we have now in which we as representatives of the people no longer have any control over government expenditures and cannot in fact hold the government accountable for its spending.
One suggestion that has been made time and time again, and I think it is a good one which will ultimately have to be accepted, is that the House, represented by the opposition, which has the principal role in this regard, should have the right to call at least one, preferably three, departments, and for the purposes of the rules this rule would be suspended in respect of those departments. Those departments would have to come before the House in Committee of the Whole and be accountable for their expenditures, without the imposition of the guillotine, as presently expressed in the rules, whereby all estimates are deemed to have been passed by the end of May. That would impose a discipline on government departments which does not now exist.
How can we possibly carry out this principal function of parliament when we have ministers who stonewall the committee and will not allow their officials to answer questions, hiding behind the excuse that the questions are ones of policy? Then when we are given the opportunity to probe and direct questions to officials of departments we really do not have the kind of back-up support necessary to take on these huge departments of government with the tremendous back-up and expertise they possess. We are just not a match for them, and it is that simple. I believe very strongly that the rules have to be changed.
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Just a few days ago in the Standing Committee on Health, Welfare and Social Affairs we were examining the estimates of the Ministry of State for Urban Affairs. Included in the estimates of the Ministry of State for Urban Affairs was a vote for Central Mortgage and Housing Corporation, a Crown corporation. We have always had the right to examine Crown corporations separately from the government ministers who answer for those Crown corporations in the House, for the very simple and logical reason that Crown corporations are not represented here, hence they cannot be accounted for. We have always had the right in committee to examine the executive officers of those Crown corporations. We examine the estimates of CN, even though they come under the Ministry of Transport. They are examined separately from the Department of Transport without the minister being present, although there are cases when he might be there; but usually he is not and we are able to direct our questions directly to the management of CN. The same applies with Air Canada, whenever we can get them, and that is not very often. It also applies to the CBC which comes under the estimates of the Secretary of State (Mr. Roberts).
However, on this particular occasion I as a member of the committee had some very important questions relating to the way that the Ministry of State for Urban Affairs had been using CMHC in a partisan way as a political instrument of the government by having government members hand out cheques on behalf of this independent Crown corporation to municipalities, an improper procedure which was using the corporation in a political way. It was making announcements on behalf of the corporation. I wanted to pose these questions to the chairman of CMHC, who was present as he should have been because vote 10, the administrative vote of the corporation, was called, but I was denied that right. I was told by the chairman of the committee that I could not direct questions to the minister's officials, and that included, of course, the chairman of CMHC as one of the minister's officials. He said I would have to direct my questions to the minister. That is a dangerous precedent because that considerably weakens what is already an inadequate system. It considerably undermines a system that is at best barely functioning, and it is already the subject of a point of order which I have raised in the House.
If we do not have the right to examine Crown corporations, then how can we pursue the day to day operations of these independent agencies of the government set up under their own statutes, autonomous of the government? If they are not accountable to us, who are they accountable to? It is interesting to note that the Auditor General had this to say about Crown corporations in his 1975 report:
In the majority of the Crown corporations audited by the Auditor General, financial management and control is weak and ineffective. Moreover, co-ordination and guidance by government agencies of financial management and control practices in the Crown corporations are virtually non-existent.
If they do not answer to parliament, the representatives of the people who own those Crown corporations, who are they accountable to? That, sir, is a question that I intend to pursue
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because, indeed, the House has a right to examine these Crown corporations independently when they come before committees with their estimates.
Getting back to the rules, I have already said that there is not a member of this House from the Prime Minister down who would not admit in his own heart that this system is not working, that we have to change it. That is why we, by order of reference in the last session, referred the whole matter to the Standing Committee on Procedure and Organization. We put in a lot of time and effort in that committee in the last session. Indeed, I can recall sitting when the House was in recess. We established sub-committees, and we went about our work seriously. We examined other legislatures around the world, and we really took our task seriously because we knew that the House took this matter seriously.
What happened to the report of that committee? It never saw the light of day. It just did not happen to suit the particular strategy of the government House leader at that particular time. He felt that the government was going to have to give too much and the opposition give too little. That was the way he proceeded, if I am not doing him an injustice. The result is that the whole matter was allowed to die and all of the work we did, the recommendations that we had put together after exhaustive study, travel and surveys, came to naught.
One of the things we looked at and reached consensus on was the establishment of a public expenditures committee that would have an ongoing function like the Public Accounts Committee. It would have an ongoing function in relation to the expenditures of all government departments and would be able to call any government department at any time throughout the year, as opposed to the present system whereby estimates are referred to committee for approximately three months. I forget when the estimates are brought in, somewhere around March, but they are reported back to the House at the end of May.
Indeed, sir, there is not a year that goes by that there is not at least one department, if not two and sometimes even more, on an agency of government that does not even get before committee. Their estimates are never examined by a committee or anybody else. The House then goes through the humiliation of having to pass an appropriations bill, knowing that we are going to be voting for $46 billion of expenditures without having properly examined these various departments as to how these moneys are being spent, or holding them accountable for how they spent their money last year. It is the day for humiliation in this House when we have to sit down at night and pass that appropriations bill year after year, knowing full well that we have not done our job, knowing full well that there have been estimates of government departments and agencies that have not even had cursory examination by committee. What an absolute farce! Is it any wonder that parliament is becoming irrelevant? Television in this House, in my view, instead of making parliament more relevant, will show it up for the irrelevancy that it has become.
Let the television cameras pan around this House tonight and see how many of us are here. And I am one of the guilty

ones, for I am not here all that often at night. This is an important bill. Let the television cameras go into the standing committees of this House where we are charged with examining $50 billion of taxpayers' money and see how many members are in these committees-not a corporal's guard. We cannot even get the usual representatives from each party in order to proceed with the examination of witnesses.
There is an improper practice that has crept into our procedures which never should have been allowed in the first place, and that is where committees now function without quorums. Committees will now function if there are five members present as long as each of the two major parties are represented. I only wish that the television cameras could relay this live and in colour to the people of Canada so they would see how totally irrelevant this institution is. When it comes to accountability, the Prime Minister (Mr. Trudeau) and his government, which has brought this parliament to this sorry situation, will have to-when it gets up its nerve to go to the people of Canada-be accountable to Canadians for what it has done to this institution.


Some hon. Members:: Hear, hear!


James Aloysius McGrath: There is no possible way that they can justify what has happened to this place. The main issue in the election is going to be the economy, and rightly so. It is going to be the inflationary situation, the consequence of runaway government expenditures. It is going to be the growth in government, a government that has been on a spending spree for the past ten years, a government that has total disregard for this place or anybody else because they know they are no longer accountable. The daily oral question period is the only area of the accountability that we have left, and even that has been emaciated and truncated to the point where it is becoming less and less effective. It is a serious situation in which we find ourselves today.
In placing before the House the amendment of my colleague, the hon. member for Calgary Centre (Mr. Andre), we have tried to improve the situation and this bill. We do so firm in the belief that unless we put our own house in order, and unless we change these grossly inadequate rules, then we will have the Comptroller General coming back with the same sense of utter frustration that the Auditor General has come back here with year after year, saying that he cannot control the situation, that it is out of control. That is something we cannot allow to happen.
If we do allow that to happen again, then we will see the printing presses at the Bank of Canada churning out more money to pay for a spending spree by a government that is out of control. There is only one way we can control it and there is only one way we can change it. That change is just as inevitable as day follows night. The solution is to change this tired government, which has nothing but contempt for the institution of parliament.
April 27, 1978


Mr. Howard Johnston (Okanagan-Kootenay):: Mr. Speaker, it is a sad time to rise in this House with the government on its deathbed and with a slip of paper coming across with a bill which more than anything else is supposed to pass as an earnest plea that there has been a deathbed repentance over there and that from now on things are going to be different. This, Mr. Speaker, after ten years of prodigality and the most profligate government this country has ever seen; ten years of ever increasing debt; ten years of endeavouring to train an entire generation of Canadians, young and old, to believe that public funds are available for everything and anything; ten years of misspending which has been documented by a variety of reports official and unofficial.
The government now has the nerve to bring forward a bill in these last days of the thirtieth parliament. This bill is to appoint an officer called the Comptroller General of Canada. I always think it is the "mp" in the word "comptroller" that is designed to add a measure of sophistication to the title and to suggest there is something unusually powerful about the office. In ordinary English it would be "cont" and it would just be "controller". But, of course, this person keeps count, one gathers, and "comptrols", and does it with force and power.
Yet there is no indication in the bill as to how this is to be done, what is to be covered, how long the individual will occupy the office, only that he will be there at pleasure and that the duties may be assigned-not necessarily will be, but may be assigned-to him. There would be no requirement on the government over there should they receive some hope for transfusion. I am sure the Canadian public is not going to give them some miracle cure at the last minute to change the situation. Should that happen we are led to believe that this might work; but we know that it is window dressing and there is nothing precise here.
Even the prodigal son after his fling was at least repentant. When he reached the bottom and there was nothing left he at least came home and made a genuine offer to go to work. I cannot for one moment believe that in Bill C-10 is a genuine offer from this government that from now on things will be different.


An hon. Member:: How many times have we heard that?


Howard Earl Johnston: We have heard it far too often. We can look almost anywhere, whether at the report of the Auditor General of Canada, who looks "after the fact" and we see his concern for such items as the spending on bilingualism in education. This accounts for most of the expenditure under the depar-ment's bilingualism development program. It consists of payments to the provinces, includes support for a variety of suggestions as to what they are supposed to be doing there, yet there is a weakening of control in the financial management of contributions.
The Auditor General and the deputy minister of the Department of the Secretary of State admitted that there was no way of auditing how these moneys are used. As members of parliament we receive complaints from within the province of Quebec that the money does not get to where it is supposed to
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for the teaching of English. We know the stories from our own provinces that the money does not get to the point of being used for teaching the French language. It disappears and there is no way of checking on it.
The Auditor General refers to the Canada Council. That organization has been thoroughly taken apart in the last few weeks and months in this parliament and elsewhere. There again there is a great need for some control. I would suggest one of the easiest ways to obtain some control would be to make up the selection committees from a group of the general public instead of setting up selection committees that in themselves are teams of artists working with their fellows. There is the kind of set up which the hon. member for Provencher (Mr. Epp) describes as incestuous and which certainly produced on the west coast an interesting game. Readers of one of the Vancouver papers were challenged to match up the awards with the judges who were making them. That is the sort of thing that should not happen.
We can look at the Auditor General's report at page 199 concerning inactive loans. Accounts in this category comprise: Loans to China-Export Credits Insurance Act-$49 million; loans to Greece-$7 million with a total of $56 million. Then there is a note which states: that these loans are described in the public accounts as being neither currently revenue-producing nor realizable. In fact, there has been no change in the outstanding balances for over 20 years.
Another different example of lack of control occurred when nothing was done. How many Canadians realize what happened to the urban demonstration program? This was a con game played with the municipalities across this country. The then minister of state for urban affairs has now moved over to the national defence portfolio where the potentiality for expenditure is much greater. In urban affairs he launched an urban demonstration program supposedly funded by $100 million. Municipalities across this country were challenged to present projects to draw on that fund. It did not exist at all. There were man-hours by the thousands spent, and delegations came to Ottawa. But there was no money there.
One would hope that a comptroller general might also be able to finger that abuse of the federal estimation of expenses as well, so that one would not only have a firmer control of money that was going out, but in future we would not have situations where lower levels of government would be hoaxed into thinking money was available thereby wasting their limited funds applying for something which could never come to fruition.
We cannot have any faith in this bill. I believe the office is needed. However, we need the amendment because the bill as it is, is too narrow, too limited, too large a device for platform waving during the election campaign that is certain to come within the year. I am sure that candidate after candidate on the government side will hold this bill up and say "We have repented. We have become truly conservative. We are away to the right in the political spectrum from the official opposition
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because we have brought forward this bill. We have set up a Comptroller General who will see that the kind of spending the government has been associated with will be kept under rigid control from now on."
I do not believe that control will happen. As long as this government is in power, this situation will be parallel to that presented by the Royal Commission on Financial Management and Accountability. I quote a paragraph from their report:
Members of parliament with whom we have met have expressed additional concerns that centre primarily on the issue of accountability of the public service. Most agreed that the traditional doctrine of ministerial responsibility must somehow be adapted to the present size and complexity of the departments and agencies for which ministers-individually and collectively-are held to account. Equally, there is a consensus that information provided to parliament for its surveillance role is insufficient, often not pertinent, or unduly complicated. We have heard numerous suggestions for improving the procedures and mechanisms by which parliament could sift and digest the information it now receives. We have found particularly striking the testimony from those with the longest parliamentary experience that parliament's control of the purse is sound in theory, but seldom practised.
I suspect that will be equally true of the role of the Comptroller General of Canada. In theory it will seem as if this official will be able to keep an eye on the expenditures of the government. However, particularly in the past few weeks, the government has found with its usual ability surprisingly large sums to spend in various downtown cores across this country where a seat might be in danger. We find announcements of expenditures running into the millions of dollars being made at nominating conventions and by new candidates who hope they will be able to stave off the day.
This will not be enough to fool the Canadian people. To bring this measure in at this time, worthwhile as the idea may be, will not be enough. The Canadian people have come to realize that in order to get a public expenditure under control, there is only one solution, and that is to defeat this government and elect the official opposition to parliament in the election that cannot come too soon.


Mr. Deputy Speaker:: Is the House ready for the question?


Some hon. Members:: Question.


Mr. Deputy Speaker:: Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Deputy Speaker:: All those in favour of the motion will please say yea.


Some hon. Members:: Yea.


Mr. Deputy Speaker:: All those opposed will please say nay.


Some hon. Members:: Nay.


Mr. Deputy Speaker:: In my opinion, the nays have it.


Walter David Baker: On division.


Mr. Deputy Speaker:: I declare the amendment lost on division.
Motion (Mr. Lambert (Edmonton West)) (for Mr. Andre) negatived.


Jack Sydney George (Bud) Cullen: that the bill be concurred in.


[Stage Direction]
Motion agreed to.
Mr. Deputy Speaker:: When shall the bill be read a third time?


Walter David Baker: At the next sitting of the House. If there is unanimous consent, Mr. Speaker, I am sure it would be appropriate to call it ten o'clock.


Mr. Deputy Speaker:: Is it agreed that we call it ten o'clock?


Some hon. Members:: Agreed.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Robert Hylton Brisco: Mr. Speaker, on one of those rare occasions when the Minister of Indian Affairs and Northern Development (Mr. Faulkner) was in the House, I addressed a question to him and received the rather insulting reply that he was going to speak to me privately about the nature of my question. I am still waiting for some kind of overture from the minister to speak to me privately.
I asked the minister why it was that the joint Cabinet-National Indian Brotherhood committee only had one area of agreement in response to a comprehensive set of proposals advanced by the National Indian Brotherhood. That one area of agreement is on the subject of land surrenders and that they shall in fact cease.
There are two basic reasons why the National Indian Brotherhood have in fact absented themselves from the cabinet-NIB committee. The first is the government's failure to recognize aboriginal treaty rights as a basic framework of serious negotiation. The second reason for the breakdown is the withdrawal of services that can only be considered by most Canadians as basic, essential and expected.
Services such as hot lunches for Indian schoolchildren have been withdrawn or cut back. Services such as fire protection on the reserve have been withdrawn or cut back. In that framework I would like to add a remark. In one example in the
April 27, 1978

province of Saskatchewan, out of 42 native houses constructed last year, 21 have burned to the ground. Indian schoolteachers on reserves have been cut back or withdrawn. All of this is in the name of restraint, yet we see the same department, Indian affairs, increasing its internal administration by 17 per cent. We think that is the figure.
We on this side have been trying to persuade the minister, the parliamentary secretary and the chairman of the standing committee to call the minister's estimates before the standing committee. As remarked by one member on this side this evening, as of midnight on the last day of May, those estimates are to be presumed to have been passed without the careful scrutiny and examination they so richly deserve. It is little wonder, on the basis of the facts that are known and those yet to be disclosed, that the National Indian Brotherhood decided the time had come, after exhaustive discussion for months and months, that they should withdraw.
The Prime Minister (Mr. Trudeau) laid it on the line for the National Indian Brotherhood in his response to questions advanced by the hon. member for Egmont (Mr. MacDonald). I quote Hansard of April 18. As reported at page 4601, the Prime Minister, responding to concern which had been expressed by the hon. member for Egmont about the provision of basic and essential services which many of us have come to expect but which are denied to the Indians on the reserves, stated:
In times when the federal government is attempting to restrain the rate of growth of its bureaucracy and when federal budgetary expenditures are being restrained it is obvious that in some areas of Canada the public will not find services growing at the rate they would like.
We do not ask that these services should grow. We ask, however, that they be maintained. We are not interested in growth, now, if there is to be restraint. But we are interested in the continuance of the basic services which have been provided to the Indian people. The Prime Minister has said this is a period of restraint. He did not tell us that he did not care how much internal administration was costing. Then the right hon. gentleman in a typical display of arrogance went on to say:
Obviously, government restraint means restraining government expenditure toward some people.
Which people? The Indian people?
As far as details of each departmental expenditures are concerned, the blue book is before the House. It can be discussed in the standing committees.
That's a joke, Mr. Speaker. When is this standing committee going to be called? Then the Prime Minister, once more with his customary disdain and demonstrating his absolute ignorance of the functions of the House of Commons as well as a short memory of what he and his government have inflicted upon us, went on to say that the government House leader would be happy to discuss with House leaders on this side when they wanted those estimates to go to standing committee. What nonsense! The Prime Minister should know better than that. He should know there is no need for consultation among the House leaders on this matter.
Adjournment Debate
In conclusion, let me say I have every reason to understand why the National Indian Brotherhood walked out of that cabinet consultative committee.


Miss Aideen Nicholson (Parliamentary Secretary to Minister of Supply and Services):: Mr. Speaker, the hon. member for Kootenay West (Mr. Brisco), both on April 19 and this evening, has expressed concern about the state of affairs in the Department of Indian Affairs and Northern Development. I am advised that as a result of the budgetary and other control systems which have been initiated in the department there is a much firmer grip on resource management than may have been the case a few years back.
The hon. member has suggested that somehow the department is withholding funding from the National Indian Brotherhood. This is not so. Nothing is being withheld from the brotherhood. The brotherhood put forward its proposed budget three weeks ago, as is customary. This submission is being actively reviewed and it is expected that it will have been dealt with within the next two weeks.
Reference was also made to a sum of $28 million being held back. This appears to be a misunderstanding of the requirement by Treasury Board that the Indian and Inuit program submit a capital management plan to the board before the board authorizes expenditures of $28 million in capital funding. It is a reasonable precaution on the part of the board to require this five-year capital plan before authorizing use of those funds. The program is now in the process of complying with that requirement.
The hon. member also said administrative costs have increased by 17 per cent. Since the 1972-73 fiscal year administrative costs have, in fact, remained practically constant at 6.1 per cent of the budget. There is good reason to believe that the institution of financial management and controls on resource allocation and expenditure will result in an improvement even in that picture in the months ahead, while services to native people are maintained.
The hon. member also referred on April 19 to a large deficit in Saskatchewan. I am advised that over-expenditures which have occurred there have arisen from enrichment of services beyond the funds allocated. Steps have been taken to ensure that regional allocations are respected in future delivery of services through a system of budgetary controls instituted as a result of reviews conducted by the program's senior management and the Auditor General.
Hon. members are aware that the department's spending estimates were referred to the committee almost two months ago. When the committee meets, the minister will be pleased to discuss any further concerns of hon. members about the administration of the department.

April27, 1978
Adjournment Debate


AGRICULTURE-PRICE OF HERBICIDES-STEPS TO ASSIST FARMERS
Mr. Jake Epp (Provencher):: Mr. Speaker, on April 26, yesterday, as recorded at page 4884 of Hansard, I asked the Minister of Agriculture (Mr. Whelan) whether he would reconsider opening the border for the importation of herbicides in those cases where it could be definitively proved that costs of those herbicides in the United States were substantially lower than in Canada.
I think we have to remember that farmers receive the international price for their products. We must also remember that the input costs farmers face have increased dramatically, thus reducing the net incomes of farmers. Just the other day the Minister of Agriculture got up in this House and said- and how he could have said it I do not know-that farm income had increased by 187 per cent. What he conveniently forgot were input costs. How could the Minister of Agriculture tell us about that increase without talking about input costs? The Canadian Federation of Agriculture has said that in the last three years net income to farmers, after costs, has dropped 54 per cent.
I remind the minister that in my home province of Manitoba in 1976 net farm income, after costs, was $327 million. In 1977 it dropped to $281 million. In 1978 it is estimated that it will drop still further, to $248 million. In 1977, operating costs in the United States increased by approximately 5 per cent over 1976. In Canada those operating costs increased by approximately 10 per cent.
That brings us directly to the problem we are facing this evening. Last year the minister closed the border to Canadian farmers who were importing herbicides. Those importations were taking place because those herbicides were priced at a lower rate in the United States than in Canada. The minister tells us that there is no appreciable price difference. I have been checking with farmers in my riding. They have been calling me as well, and there are substantial price differences. If we take into account the discount on the dollar which is now 12 cents or 13 cents, imports, brokerage fees and transportation costs are still lower in the United States.
Hon. members do not have to depend on my Figures or the figures of farmers in the riding of Provencher. Let us look at the minister's figures. In a letter dated April 13, 1978 addressed to the hon. member for Lisgar (Mr. Murta) the minister pointed out that in North Dakota and Manitoba Treflan, Cobex and Avadex were more or less the same price. He gave the highs and lows for the state of North Dakota and the province of Manitoba.
However, let us look at two other herbicides and the minister's figures with regard to them. The low price for Eptan 8 in North Dakota is $2.49, and the high price is $2.67. Those are base prices related to pounds of active ingredient. In Manitoba the low price is $3.50, and the high is $3.95 per pound of active ingredient. That is a 70 per cent differential. How can the minister say that the price is more or less the same?

What about Eradicane? In North Dakota-I am using again the minister's own figures-$2.67 is the low and $2.92 is the high. In Manitoba, $4 is the low and $4.31 is the high, an increase of 65 per cent.
All that Canadian farmers are saying is this, and it is a very simple request: we must compete on the international markets. We receive the price for our products that the market will bear. Why must we be penalized by the Minister of Agriculture, who claims he is a friend of the farmer, and why can we not buy herbicides at prices that are most beneficial to Canadian farmers? They are proving time after time that their input costs are rising. The herbicides which they buy in Canada come from the United States in the first place. Who is taking the mark up? Here is the Minister of Agriculture, the self-proclaimed friend of the farmer, willing to jeopardize and to penalize Canadian farmers to the extent of 65 per cent to 70 per cent, which is his own Figure. Where is the justice?
In his own letter the minister says that on March 9 when this survey was done they had minimal figures on hand. He said that the consultative committee made up of members of the industry and farm groups was to meet on April 27, which is today. If I can take the minister's letter at face value, that meeting has taken place. I say to the minister clearly that he better come up with much better evidence other than what the farmers are giving him, what the farm groups are giving him and what the brokers are giving him, as well as what members of parliament who have done their own research are saying.
I say to him that if he can justify a penalty of 65 per cent to 70 per cent to Canadian farmers, then the service that he is giving to farmers is of no benefit. I challenge him and his parliamentary secretary to give Canadian farmers an equal break and allow them to compete in the international market at prices that other farmers, such as farmers in the U.S., have to pay. We must allow them to compete. If we do not, this basic agricultural community which is so essential to Canada's economy will continue to flounder, input costs will continue to rise, and farmers' income will continue to drop. How are we to maintain family farms? It is the responsibility of this Minister of Agriculture to start defending agriculture in the practical ways which I have mentioned tonight.


Mr. C. Douglas (Parliamentary Secretary to Minister of Communications):: Mr. Speaker, I am very happy to reply to the question raised by the hon. member for Provencher (Mr. Epp) in the "packed" House this evening.
The closing of the Canada-United States border to imported pesticides does not seem to have adversely affected the prices of pesticides in Canada over that period. The pesticide price and supply committee mentioned by the hon. member which was set up to monitor prices and supplies when the border was closed on March 4, 1977 has now met six times and is in its second year of operation. It has not found any price spreads inconsistent with the usual cost factors in the pricing of herbicides. As a matter of fact, as the hon. member mentioned, that committee did meet today.
April 27, 1978

A comparison of the 1977-78 closed border period with the preceding three years does not indicate any increased price trends due to the border closing. In fact, pesticide price increases still lag behind the cost of living index increases. The general picture this year seems to be similar to that of last year.
As was the case in 1977, some pesticides are being offered at some United States locations more cheaply than directly across the border in Canada. Some products are lower priced in Canada than in the United States and others are offered at comparable prices in both countries.
While there is no common price for any given pesticide because of the nature of the pesticide market, the committee finds that prices reflect in the usual way the quantities sold, different profit margins and local costs that depend on location, cost of credit, package size and other factors. Casual comparisons of United States and Canadian prices can be misleading if all factors, including currency exchange rates and the difference in units of measure between the two countries, are not taken into account.
The pesticide price and supply committee have come up with some very interesting findings. For example, based on equivalent measure and Canadian dollars, we have compared the highest Canadian price versus the highest United States price. Let us look at some of these. A corn herbicide, atrazine
Adjournment Debate
80W, was found to be 11 per cent less in Canada; semcor 50W, a bean herbicide, 17 per cent less; zolone 30W, a fruit and vegetable herbicide, 27 per cent less.
What about the phenoxy herbicides and wild oat killers. Such as 2,4-D amine 80; MCPA amine 80; MCPA ester 80; treflan; carbyne; avadex BW and avadex 10G? Using the highest price comparisons, Canadian prices range from 1 per cent to 18 per cent less than United States prices. One must remember this is on a corrected measurement and Canadian dollar basis.
For these last items I have just mentioned, I also have a comparison of the lowest Canadian price found and the lowest U.S. price. Looking at 2,4-D amine 80 on this comparison, Canadian prices were 41 per cent less than the lowest U.S. prices. Of course, some products for the same uses are more expensive to varying degrees in Canada than in the United States, depending on the retailers and geographic areas compared. For instance, eptam, which the hon. member for Lisgar (Mr. Murta) mentioned this afternoon, is sometimes more expensive in Canada than in the United States. But we must remember atrazine and 2,4-D, two of the most important weed killers in Canada, are cheaper than in the U.S.A.


Mr. Deputy Speaker:: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 11 a.m.
Motion agreed to and the House adjourned at 10.19 p.m.

Friday, April 28, 1978