1978-06-26

Mr. Donald W. Munro (Esquimalt-Saanich):: Mr. Speaker, I rise under the provisions of Standing Order 43. My motion is urgent and pressing because of the decisions likely to be taken today and tomorrow in Quebec city at the federal-provincial wildlife conference affecting the federal-provincial committee on humane trapping whose mandate could end next year, and also because of the unanimous report on humane trapping tabled in this House on Monday, April 24. 1 move, therefore, seconded by the hon. member for Surrey-White Rock (Mr. Friesen):
The conference in Quebec be informed of the view of this House to the effect that research and field testing of humane trapping devices be continued and be co-ordinated by the federal-provincial committee on humane trapping for at least a further two years beyond its present mandate in an effort to develop humane trapping methods and a code of humane trapping ethics, and that provincial governments and the industry be urged to collaborate with this committee in this worthy endeavour.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
In light of the fact that the auto pact between Canada and the United States obligates the auto makers to allocate investment in our country in order to ensure that we get our fair share of growth in this industry, and considering that this obligation commits the auto makers in principle to invest several hundred million dollars a year in Canada for the foreseeable future, 1 move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House condemns the government's failure to force the auto makers to meet their investment obligations under the auto pact and that, moreover, it condemns the government's attempt to cover up this failure by offering taxpayers' money as subsidies to entice them to do what they ought to have done without subsidy.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
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ANNIVERSARIES
Mr. Edward Broadbent (Oshawa-Whitby):: Mr. Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity arising out of the news that the federal government has become involved in a bidding war to attract auto plant investment to Canada, and specifically arising from the news that as a result of his failure to convince Ford Motor Company of Canada Limited to live up to its obligations under the auto pact, in spite of having profits in


Mr. John C. Crosbie (St. John's West):: Mr. Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43. In view of the fact that Saturday, June 24, marked the four hundred and eighty-first year since the discovery of Newfoundland by John Cabot on June 24, 1497, and that the discovery is celebrated as St. John's Day and is marked by a public holiday in St. John's, Newfoundland, today, I move, seconded by the hon. member for St. John's East (Mr. McGrath):
That this House join all Newfoundlanders in celebrating St. John's Day and the anniversary of the discovery of their native isle 481 years ago, after the Vikings but before the Canadians, and looks forward to a happy and enduring union for at least another 481 years.

June 26, 1978


LOTO CANADA
Mr. Paul Dick (Lanark-Renfrew-Carleton):: Mr. Speaker, I rise, pursuant to Standing Order 43, on a matter of urgent and pressing necessity. In view of the fact that the Ontario Lottery Corporation and Loto Quebec have asked for proposals from electronic terminal and computing firms, which manufacture here in Canada, as of early June, 1978, and subsequently have had public bidders' conferences to give representatives of these firms more specific information, these conferences attracting some 125 representatives in Toronto and 95 in Montreal, I move, seconded by the hon. member for Parry Sound-Mus-koka (Mr. Darling):
That this House condemns Loto Canada for sole-sourcing its lottery gaming contract to an American firm which will result in less Canadian content than other Canadian manufacturers could have guaranteed, thus ignoring the federal government's announced "Buy Canadian" policy and in effect exporting what would otherwise be Canadian jobs to the United States, and that this House instructs the Crown corporation, Loto Canada, to withdraw from any agreement with General Instrument of Canada Ltd. and to seek applications from the Canadian industry through public tenders for the large, $23 million contract.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


TRANSPORT
Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I rise on a matter of urgent and pressing necessity pursuant to Standing Order 43. In view of difficulties and law suits involving the Minister of Transport and his department because of policies, rules and regulations respecting car rental concessions and counter space at nine major Canadian airports, I move, seconded by the hon. member for Lisgar (Mr. Murta):
That the minister make a statement on motions this week dealing with some of the following points: complaints on file from major car rental companies that Host Rent-A-Car has not met the strict requirements of articles 4 and 5 of its agreement with the Crown re non-payment of fees and guarantees; what if any action he has taken pursuant to article 27 respecting default of the agreement between Host and the Crown relating to the non-payment of fees and guarantees; whether interest on such moneys is being claimed pursuant to article 6 of the agreement; and, finally, in view of the substantial problems recently encountered, whether the minister intends to change tendering procedures which up to now have encouraged unrealistic projections.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Mr. Bill Jarvis (Perth-Wilmot):: Mr. Speaker, my question is for the Prime Minister. It relates to the former chairman of the National Energy Board, Mr. Crowe, who was in that position until December 31 last and has now accepted a position on the board of directors of Sulpetro of Canada Limited which currently has an application for gas exports before the National Energy Board. I have in mind the letter sent by the Prime Minister to senior office holders on October 18, 1976, which states:
A former office holder must not, within the relevant time period accept appointments to the board of directors of a commercial corporation which was, as a matter of course, in a special relationship with the department or agency with which he was last employed, where "special relationship" means regulation of the corporation by the department or agency.
I ask the Prime Minister whether it is his view that Mr. Crowe was in violation of these guidelines in accepting that specific directorship.


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, without wishing to comment on this particular case, I remind the hon. member that the guidelines we issued did not apply to judicial or quasi-judicial officers. We published guidelines concerning ministers and members of parliament which were then studied by a committee of the House. We also published guidelines concerning former civil servants. Although we did look at the matter of holders of judicial or quasi-judicial offices, it was our feeling at the time that we should not publish guidelines in that area, certainly not without further discussions with the courts. I think the House will understand that the government was somewhat reluctant to go from the executive or legislative branches into the judicial branch. That is why we have not published guidelines.
I am not commenting on the particular case. It may or may not be a conflict of interest situation. But I can tell the House that on the basis of the public guidelines, there were none for holders of quasi-judicial offices.


William Herbert Jarvis: Mr. Speaker, without entering into a debate with the Prime Minister on the nat e of that specific office, may I ask him whether the advisory committee would have advised this specific former chairman, Mr. Crowe, as to the applicability of the guidelines to his particular case when he left the National Energy Board last December 31 ?


Pierre Elliott Trudeau: Mr. Speaker, the advisory board applied to those who are covered by the guidelines, not other persons. I repeat, it is a delicate matter for the government to publish guidelines to holders of judicial or quasi-judicial offices. I think that particularly the parties on the other side of the House which were critical of the government when it took
June 26, 1978

action which might be interpreted as intervening in the judicial process would understand that reluctance.


William Herbert Jarvis: Mr. Speaker, the Prime Minister still has not said, in relation to this specific case, whether he regards it as being exempt from the guidelines. I ask him this specific question: To his knowledge, was the superior-in this case, the Minister of Energy, Mines and Resources-consulted pursuant to the guidelines which provide specifically for disclosure to a superior when one has received or intends to accept an offer in the private sector which may be offensive to the guidelines? Does the Prime Minister know whether the Minister of Energy, Mines and Resources was consulted by Mr. Crowe pursuant to those provisions and, if so, what advice was given to Mr. Crowe by the minister?


Pierre Elliott Trudeau: Mr. Speaker, after two answers I am afraid the hon. member still has not understood. There are no guidelines concerning holders or former holders of judicial or quasi-judicial offices. The National Energy Board is a quasijudicial office. If the House in some way wants the government to publish guidelines in that area, we will consider the matter.


LEGISLATION COVERING PUBLIC SERVANTS
Mr. Perrin Beatty (Wellington-Grey-Dufferin-Waterloo):: Mr. Speaker, it is perhaps ironic that today, when the government House leader is scheduled to introduce conflict of interest legislation for members of parliament, we should discover how weak the guidelines are for public servants. I ask the government House leader whether it is the intention of the government to bring to parliament comprehensive and explicit conflict of interest legislation which will apply to public servants who will be leaving office and seeking outside employment.


Hon. Allan J. MacEachen (Deputy Prime Minister and President of Privy Council):: Mr. Speaker, as the House knows, there is on the order paper notice of a bill called the independence of parliament act which will establish rules and regulations for members of parliament and members of the Senate. It is not the intention, nor does the bill cover, quasijudicial offices. But if it is the wish of the House that we move in that direction, of course it will be a matter that we would want to consider, as the Prime Minister has suggested.


Henry Perrin Beatty: Mr. Speaker, the amended guidelines which involve, among other things, public appointees who are appointed by the governor in council, contain the following statement:
The policy will apply to all persons appointed to new positions within the government and its agencies who will be expected to conform to it as a matter of honour and of personal choice.
Is it the intention of the government to introduce legislation before parliament or to take some action with these guidelines to ensure that sanctions are put in place so that people who
Oral Questions
decide to violate the guidelines out of choice can have sanctions applied against them?


Allan Joseph MacEachen: There is no intention to bring in legislation to that effect, Mr. Speaker.


APPOINTMENTS ACCEPTED BY EX-CHAIRMAN OF NATIONAL ENERGY BOARD
John Edward Broadbent: Mr. Speaker, I have a question for the Prime Minister on the same subject matter. Is he aware that Mr. Crowe, in addition to his new position on the board of Sulpetro of Canada Ltd., was also appointed just last month director of Energy Ventures Company Limited, of the United States, which, together with Alberta Gas Trunk Line Company has purchased 4 per cent of Husky Oil shares and, furthermore, that Energy Ventures is controlled by Northwest Pipeline Limited, the U.S. partner of Foothills, in the building of the Alcan pipeline?
I submit to the Prime Minister that this is factual information, and I ask whether he is aware of it and, more specifically, considering that the National Energy Board must give its final approval on major details pertaining to the construction of the pipeline, involving the expenditure of millions of dollars, does he not think that in the spirit of the guidelines he should recommend to Mr. Crowe that he not accept these positions?


Pierre Elliott Trudeau: Mr. Speaker, in answer to the first part of the question, yes, I have been so informed in the last few minutes. With regard to the second part of the question about my informing Mr. Crowe, I will put the question back to the whole House. Do hon. members want the government to communicate with judges, former judges, quasi-judges, or not? Until now, because of the delicacy of the administration, the government commanding judges or quasijudges to perform in any particular way, we have not covered them with new guidelines. Whether or not we should do so is a matter for debate in the House. We are very anxious to hear whether members of the opposition think that henceforth, before appointing judges or quasi-judges, we should impose certain conditions on their post-employment.


John Edward Broadbent: The Prime Minister cannot shift the responsibility of his government to the opposition. I point out to the Prime Minister, who is a lawyer, which I am not, that it seems to me he is playing pretty loose with the term "quasi-judicial bodies" when he is talking about the National Energy Board which makes major policy decisions and major recommendations to the government involving the spending of millions of dollars. Speaking for my party, 1 can tell him unequivocally that, yes, we are in favour of the guidelines being applied to such positions.


Mr. Speaker:: Order, please. Will the hon. member put his supplementary question.


John Edward Broadbent: Yes, Mr. Speaker, I am coming to my specific question. Given the spirit of the guidelines, will the Prime Minister deal with them in the spirit as they pertain to

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Oral Questions
Mr. Crowe who has now involved himself in major corporate positions involving submissions to the NEB which he headed a few months ago? Does he not think, as Prime Minister, that he should have a chat with Mr. Crowe urging him to step down in the public interest from the positions he has accepted?


Pierre Elliott Trudeau: Not so many months ago hon. members on the other side of the House generally were arguing that we should not have chats with people who held judicial or quasijudicial positions.


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: If the opposition wants to be fair at all on this, they will recall that following certain events concerning the judiciary we published guidelines for ourselves indicating in what way the ministry should be entitled to communicate with the judiciary, and that included the quasi-judiciary. At that time we made it quite clear that quasi-judicial officers were in a particular situation vis-a-vis the administration. Now we hear the opposition telling us this is only a fiction, that they are not quasi-judicial officers, that in some way they are the instrument of government policy. I tell the leader of the New Democratic Party that the consequences of this new policy of his is a very strange one indeed if he thinks that the National Energy Board is an emanation of government policy. He should revise his views on that.


Some hon. Members:: Hear, hear!


Mr. Clark:: Read the act.


John Edward Broadbent: The Prime Minister has made his usual equation in carrying a logical point all the way to an absurd conclusion. It is not at all warranted by the facts. Would he answer the question? I put it to him for the third time. In the interests of the spirit of the guidelines, with specific reference to the National Energy Board-no other body in this instance-would he not think it appropriate, as Prime Minister, to recommend to Mr. Crowe that he step back from the positions he has accepted, which put him in my mind, unequivocally, in a conflict of interest position?


Pierre Elliott Trudeau: Mr. Speaker, that is the third time the same question has been asked. The answer is that the spirit of the guidelines and the letter of the guidelines does not apply to quasi-judicial officers. The government is prepared to advance in this field. As a matter of fact, we did look into it before publishing the guidelines, but then we thought it would be more compatible with the division of powers and the non-interference by the executive into the quasi-judicial branches that we not publish guidelines. I note the House now is taking the position that we should have. That is natural. They always take the counterposition to whatever the government does.


Some hon. Members:: Oh, oh!


AIR CANADA
Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, my question is directed to the Minister of Transport.
At about 8:15 a.m. at a Toronto airport, an Air Canada DC-9 aircraft made an unfortunate crash which resulted in injuries to several passengers and the death of a few others. Is the minister in a position to tell the House whether he has been officially advised of the number of losses of life and also the main cause of that accident.


Hon. Otto E. Lang (Minister of Transport):: Mr. Speaker, I have, of course, received preliminary reports about the incident and our investigating team is on the site. I hesitate to use specific figures until I have a further report both with regard to the causes of the accident and also with regard to the exact number of persons killed or injured. However, the report at this point does tend to indicate there were three persons killed and 43 injured.


Joseph Adrien Henri Lambert: Mr. Speaker, I should like to put a supplementary question.
According to the news service, the aircraft had left the Ottawa airport for Winnipeg via Toronto. Was the minister told whether there were federal civil servants or parliamentary officials because another source, another radio station, suggested that among the victims there were parliamentary officials on the aircraft. Can the minister tell the House whether this is true?


Otto Emil Lang: Mr. Speaker, I do not have full information about passengers boarding in Toronto, but I am informed that only two of the passengers on the aircraft had boarded in Ottawa. They were not connected with parliament or the government in any direct employment capacity.


Joseph Adrien Henri Lambert: I have a supplementary question, Mr. Speaker.
Given the gravity of the situation and also given the fact that in 1970, if I remember correctly, another Air Canada aircraft was involved in an accident which cause the death of over 100 persons, can the Minister tell the House, in order to reassure Canadians about the safety of Air Canada aircraft, whether he will order an inquiry to identify the real causes of these two accidents? The causes of the first one may be known, but they were not reported, at least not in this morning's news. Can he do that to reassure Canadians about the safety of this

June 26, 1978

Crown corporation so that it is demonstrated that the situation is not worse with this company than with others and that we can go on travelling safely on the aircraft of Air Canada?


Otto Emil Lang: Mr. Speaker, I certainly do not think the two incidents should be connected at all, since they involve different aircraft and, very clearly, different causes, quite apart from what those causes might be. It is important, even while we regret any particular incident and extend sympathy to those who have lost friends and relatives in a crash like this, to recognize that Air Canada's record of safety is very, very good. Indeed, I think it's very close to being among the best in the world.


INDUSTRY
Mr. James Gillies (Don Valley):: Mr. Speaker, in the absence of the Minister of Industry, Trade and Commerce and the acting minister, I will go to the second minister, the Minister of Employment and Immigration. Can he tell us why the Minister of Industry, Trade and Commerce reneged on the offer he made to the province of Ontario through the minister of industry and tourism of that province to share in the subsidy that was about to be offered to Ford Motor Company to locate their plant in Windsor, Ontario?


Hon. Bud Cullen (Minister of Employment and Immigration):: Mr. Speaker, my colleague, the Minister of Industry, Trade and Commerce, indicated there was no reneging nor was there any commitment made to the 75-25. If this plant were built in Ontario in a DREE area, there would be some basis for making that particular allegation. The Minister of Industry, Trade and Commerce is, I believe, in Toronto today discussing this very matter.


James McPhail Gillies: Can the Minister of Employment and Immigration tell us whether the government has a set policy with regard to this type of operation, because it seems clear that the degree of subsidy offered in a variety of areas is considerably different? For example, General Motors has apparently been offered an 80 per cent subsidy if it locates in or just outside Montreal. What is the policy of the government on this? Is there an established policy of providing significant aid through the provinces to these locations which is the same throughout the country, or does it vary according to the circumstances?


Jack Sydney George (Bud) Cullen: Mr. Speaker, the government's policy under the Department of Regional Economic Expansion is well known. It is a consistent policy and it is applicable right across the country. Therefore, there is no conflict in that area at all.


James McPhail Gillies: If I might go back, Mr. Speaker, it seems there is a conflict. It is quite clear that the offer made to General Motors is different from the offer that was made to Ford with regard to the percentage of the subsidy. All reports suggest
Oral Questions
this is the situation. I again ask the minister, why was the offer of support 80 per cent in the case of General Motors and only 50 per cent in the case of Ford?


Jack Sydney George (Bud) Cullen: Mr. Speaker, that sounds to me like the wildest kind of speculation in which the hon. member is engaging. I do not think that question should be answered.


REASONS BEHIND ALLEGED POLICY TO REDUCE JOBS IN QUEBEC
Mr. Heward Grafftey (Brome-Missisquoi):: Mr. Speaker, I should like to ask the right hon. Prime Minister a question which concerns at least 150,000 workers in the province of Quebec.
In view of the fact that over 30,000 jobs have been lost in the province of Quebec during the past few months in the traditional sectors of the clothing, textile, footwear and furniture industries, and that the unemployment there, which averages over 11 per cent, reaches some 15 per cent in a number of cities, I should like to know why, in an official document entitled "Briefing Notes for Consultative Task Forces" and dealing with tariff bargaining, the Department of Industry, Trade and Commerce indicated the following objectives as government policies for these sectors, and I quote:
The objective of the policy should be to reduce gradually the number of jobs by increasing rationalization with a necessary minimum of protection during the trasition period.
Given those facts, I ask the right hon. Prime Minister why the government supports such a policy?


Pierre Elliott Trudeau: Mr. Speaker, I do not know what documents the hon. member has in his hand, but perhaps he could table them and I could discuss his question.


William Heward Grafftey: Mr. Speaker, I would like to know from the right hon. Prime Minister whether the ministers from Quebec intend, during parliamentary recess, to visit the Quebec localities where the textile, clothing, footwear and furniture industries are located to explain why it is the policy of the government to cause those industries to disappear, and to inform-


Mr. Speaker:: Order, please. I am sure the hon. member will recognize the argumentative line of his questions.
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June 26, 1978
Oral Questions NATIONAL DEFENCE


PURCHASE OF FIGHTER AIRCRAFT
Mr. Allan B. McKinnon (Victoria):: Mr. Speaker, in the absence of the Minister of National Defence I will direct my question to the Prime Miniser. Can the right hon. gentleman confirm that the new fighter project management office has recommended that a short list of three planes be considered for the impending fighter contract-the F-16, the F-18A and the F-18L?


Pierre Elliott Trudeau: I am not sure what the hon. member is quoting from. It is certainly not government policy.


Allan Bruce McKinnon: I was not quoting from anything at that point except my own question, Mr. Speaker. Perhaps the Prime Minister has noted the following quotation from a Canadian Press release:
"One of the options the cabinet is considering is a so-called short list dropping some of the competing firms", Danson said.
Could the Prime Minister tell the House whether the choice is being dictated entirely by the fact that these three planes are the cheapest of those under consideration and that since only a fixed sum of money is available-$2.3 billion in 1977 dollars- other important factors such as air superiority qualities, range, and target acquisition capability all have to be sacrificed in favour of financial considerations?


Pierre Elliott Trudeau: The question is purely hypothetical. However, I can tell the hon. member that we want to try to get the best plane for the least money.


CANADA WEEK
Miss Flora MacDonald (Kingston and the Islands):: Mr. Speaker, my question is to the Prime Minister. Given the depressed state of the textile industry in Canada and the amount of public money which has gone into the promotion and celebration of Canada Week activities, I should like to ask the right hon. gentleman why the official scarf for the celebrations bears the label "Made in Japan"?


Some hon. Members:: Oh!


Pierre Elliott Trudeau: I did not order that scarf myself. I will take notice of the question.


AGRICULTURE
Mr. R. E. McKinley (Huron-Middlesex):: Mr. Speaker, the largest show of its kind in the world, the International Plowing

Match and Farm Machinery Show, will be held in Huron county this year from September 26 to September 30. This event features new and old methods of plowing and over 400 exhibits including the latest in farm machinery and new technology and will be held just outside Wingham, Ontario.
I would like to ask the Minister of Agriculture whether, when he receives his invitation to attend, he will reply in the affirmative so that he can be brought up to date in the latest farming methods. Further, since Huron is a large beef producing country, I suggest he should not allow the government to increase the import quotas on the entry of beef into Canada or he might not be very welcome at the event.


Hon. E. F. Whelan (Minister of Agriculture):: I will take the hon. member's representations under consideration.


MANPOWER
Mr. Jean-Robert Gauthier (Ottawa-Vanier):: Mr. Speaker, my question is directed to the Minister of Employment and Immigration: it concerns the impending application by the province of Quebec of restrictive labour regulations preventing, as of July 1, many Canadian tradesmen from working in Quebec. Is the hon. gentleman consulting with his colleague, the Minister of Labour, with a view to supplying this House with statistics showing the effect of this move on, for example, mobility grants which constitute an important program in his department, and will he tell us what decision he has taken to ensure interprovincial mobility in light of the socioeconomic impact the regulations may have on border communities?


Jack Sydney George (Bud) Cullen: This issue has also been raised by the Parliamentary Secretary to the Minister of Finance since the proposal would have a particularly detrimental effect on people who live in Cornwall and along the border. It would certainly have a negative impact. I believe the Prime Minister indicated on Friday that we are opposed to action of this kind being taken, and I believe he also said he was awaiting an opinion from the Department of Justice. We do make mobility grants available to workers moving both ways. I will get the figures for the hon. member.


PETRO-CANADA TAKEOVER OF HUSKY OIL
Mr. David Orlikow (Winnipeg North):: Mr. Speaker, my question is for the Prime Minister. It arises from the statement made by the premier of Saskatchewan indicating the support of that province for the Petro-Canada proposal rather than that of the Occidental Petroleum Corporation on the grounds, and I quote, that "it would serve the public interest better". In
June 26, 1978

view, also, of Alberta's lack of interest in operations outside that province, may I ask the right hon. gentleman whether the government still supports the Petro-Canada proposal and will so indicate to FIRA?


Pierre Elliott Trudeau: Mr. Speaker, Petro-Canada is a Crown corporation which is operating at arm's length from the government, and the role of the government thus far has been to change the speed of cash flow in order that Petro-Canada could make the offer it did. Petro-Canada is operating in the marketplace and I am happy to learn that the premier of Saskatchewan has supported its action.


David Orlikow: Would the Prime Minister tell us whether the cabinet has approved the capital budget of Petro-Canada in an amount sufficient to acquire Husky Oil and, if so, can he tell us why the government is not expressing in more direct terms its approval of the principle that the heavy oil resources of Saskatchewan should be developed by Canadian rather than United States interests?


Pierre Elliott Trudeau: It was made quite clear by the Minister of Energy, Mines and Resources and by myself the other day in replying to a question from the leader of the New Democratic Party that we wanted Canadian resources to be exploited by companies which were 50 per cent to 60 per cent owned by Canadians. That is still our policy. As for the first part of the question, arrangements were made to permit Petro-Canada to get into the market and make this bid.


AIR TRANSPORT
Mr. James A. McGrath (St. John's East):: Mr. Speaker, I have a question for the Minister of Transport. It concerns the tragic crash on Friday in St. John's, Newfoundland, of a chartered aircraft resulting in the death of ten people including the chairman of the National Historic Sites and Monuments Board, three members and two senior employees of the board. I know all hon. members will identify with me in extending sympathy to the families of these public service people. Can the minister tell us whether there is an investigation under way and whether the Minister of Transport has been able to determine the cause of this crash?


Otto Emil Lang: Certainly, we all join in expressing sympathy to those who were bereaved as a result of this crash, including the families of the pilot and co-pilot of the aircraft. An investigation team arrived on the site the same afternoon, I am informed, and an investigation is going forward. It would be premature for me to attempt to say anything further.
Oral Questions


ROYAL CANADIAN MOUNTED POLICE
Elmer MacIntosh MacKay: Mr. Speaker, my question is intended for either the Minister of Employment and Immigration or the Solicitor General. What representations, if any, have been made to date to expedite the return to Canada of Warren Hart to testify before the McDonald royal commission further to the meeting which took place in Washington between Mr. Hart and his counsel and the chief counsel and an investigator from the commission? I should like to know when his return is likely so that we can get to the bottom of matters directed by the RCMP involving this former FBI agent.


Hon.   J.-J. Blais@Solicitor General: Mr. Speaker, I have received no representations from the inquiry for the return or presence of Mr. Hart to appear before the commission.


Elmer MacIntosh MacKay: A brief supplementary question concerning the royal commission. Could one of the ministers-I suppose it should be the Solicitor General-tell me whether, when ministers and deputy ministers are testifying before the McDonald commission, they will be cross-examined by the same counsel who are seized of specific areas in the inquiry such as National Revenue, the Post Office, and so forth, in order to ensure that various counsel will have an opportunity to cross-examine on the various aspects implicit in ministerial responsibility?


Mr. Blais:: Mr. Speaker, 1 will inquire and advise the hon. gentleman.


IMMIGRATION
Mr. Jake Epp (Provencher):: Mr. Speaker, I would like to direct my question to the Minister of Employment and Immigration. It concerns the derailing of an underground railway which operates between Toronto, Montreal and the United States. Illegal aliens were smuggled into the United States from Canada. How long did the minister know about this operation, how many Canadians were involved, and how many illegal aliens have been taken to the United States by the principals involved in this operation?


Jack Sydney George (Bud) Cullen: Mr. Speaker, I do not have all the facts. I know that seven of the nine adults arrested have been deported from Canada. I believe that was the total number of the group in this particular investigation.


Arthur Jacob (Jake) Epp: On April 18, and again on April 25, I pointed out to the minister that his own officials in Toronto had documented 100 cases of marriages of convenience and that departmental documents indicated that this was but the tip of the
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June 26, 1978
Oral Questions
iceberg. In view of further revelations that Canada is a base of operations in the exploitation of humans in the most repugnant manner, I would like to ask the minister whether charges have been laid in connection with both cases I brought to his attention. Especially in this latest case, has he laid charges and, if not, why not?


Jack Sydney George (Bud) Cullen: Mr. Speaker, thankfully, we have one of the best federal police forces in the world and I think it has done a commendable job in this regard. The whistle had to be blown a little earlier here, again, I think, in a humanitarian way because of the two children involved and the somewhat intemperate weather.
As I indicated to the hon. member during the study of estimates and here in the House, the marriage of convenience question is very difficult. It is a judgment call which has to be made. When a lady swears undying love for a gentleman and says this is what she has been waiting for all her life, it is a pretty tough call for someone to make.


FEDERAL-PROVINCIAL RELATIONS CONSTITUTIONALITY OF RESTRICTION ON ONTARIANS WORKING IN QUEBEC
Mr. Maurice A. Dionne (Northumberland-Miramichi):: Mr. Speaker, my question is supplementary to the one asked by my colleague, the hon. member for Ottawa-Vanier, and I direct it to the Prime Minister. In view of the policy of the elitist government of Quebec to eliminate freedom of movement not only interprovincially but also within the boundaries of Quebec, can the Prime Minister advise the House whether he has decided to have this arbitrary and unCanadian law referred to the supreme court to determine its constitutionality? This law could have serious effects on workers in Quebec as well as in several other provinces.


Pierre Elliott Trudeau: Mr. Speaker, I share the concern of the hon. member but I am afraid I cannot add much to what I said late last week in answer to a question. The matter is being looked at by the Department of Justice and we will get advice from that department on the matter of a reference.
In the meantime, I repeat that this is a matter which we hope will be solved between the two provinces mainly concerned. I understand that Premier Davis and Premier Levesque have been in communication on this matter. It is the general desire of the provinces that we not intervene in matters of provincial jurisdiction. I hope the premiers themselves will be able to settle this matter, but if they want our help and if it is possible, we will gladly give it to them.


MULTICULTURALISM
Mr. Stan Schumacher (Palliser):: Mr. Speaker, my question is for the President of the Treasury Board. In view of the minister's desire to cut government expenditures which effort, he says, is restricted by obligations imposed by statutory transfer payments to the provinces, can the minister say whether he considers it proper for the province of Quebec to fund the activities of French-speaking groups outside Quebec, as has been recently described by the Hon. Claude Morin, who in turn has been described by Premier Levesque as his foreign minister?


Hon. Robert K. Andras (President of the Treasury Board):: Mr. Speaker, I suppose the key question would be with whose funds such activities are being financed. I am not aware that any federal funds transferred to the province of Quebec are being so used.


Stanley Stanford Schumacher: Mr. Speaker, can the minister assure us that activities funded by the province of Quebec are not of this nature, and is there any monitoring device to make sure that federal funds which are paid by way of transfer are not used in this way? Are the activities involved in any way similar to those previously carried on by the Parizeau spy network?


Robert Knight Andras: Mr. Speaker, I will have to examine that question carefully. I will take it as notice. I am not aware of any such trend, but I will investigate.


CONFLICT OF INTEREST
Charles Joseph Clark: Mr. Speaker, I would like to bring the Prime Minister back to the question regarding the National Energy Board. The Prime Minister indicates it is his view that the National Energy Board is exclusively a quasi-judicial body and consequently exempt from conflict of interest guidelines. On consulting the act setting up the National Energy Board, he will find that section 22 vests clear advisory functions. I quote the relevant section as follows:
-shall recommend to the minister such measures within the jurisdiction of the Parliament of Canada as it considers necessary-
Consequently, it is very clear that the National Energy Board is not exclusively a regulatory body. I should say, in passing, that the Prime Minister is trying to draw a red herring across this debate when he suggests that quasi-judicial bodies are in exactly the same position as judicial bodies. Let us put that to one side for the moment. Given the advisory nature set out in the statute of the National Energy Board, is it the intention of the Prime Minister to continue to exempt people associated with the National Energy Board from the conflict of interest guidelines?
June 26, 1978


Pierre Elliott Trudeau: Mr. Speaker, the Leader of the Opposition introduced the word "exclusive", which I never used. He obviously used it for a very good reason. He seems to have been shown what the act says, but if he had not read selectively only one paragraph of the act, he would have seen that section 10(3) describes the powers of the board and says:
-all such powers, rights and privileges as are vested in a superior court of record.
It seems to me that this makes it quite clear that the National Energy Board has the powers of a court of record, and that makes it a quasi-judicial body.


James McPhail Gillies: Preposterous.


Pierre Elliott Trudeau: This does not alter the substance of what I said earlier, that the government studied the possibility of regulating post-employment conditions for members of judicial or quasi-judicial offices. It might apply a fortiori when these quasi-judicial offices also have advisory functions, as the Leader of the Opposition said, and I indicated that the government had considered such guidelines and would be prepared- possibly to follow up the bill which will be given first reading today and which I am sure will be studied by all members of the House-to go one step further. I indicated that we had some hesitancy in doing so, but I am glad that the opposition parties seem united in stating that the government should extend its guidelines to holders of judicial or quasi-judicial offices.
The Leader of the Opposition shakes his head. Now he has a new position. I really would like to know the position of the Leader of the Opposition and his party. However, as far as we are concerned, we will continue with our work and probably publish such guidelines. I think when that is done, even the opposition will recognize that a holder of such office could certainly be asked to abide by the spirit of the guidelines, but he certainly could not be held retroactively to abide by guidelines which have not yet been published.


Charles Joseph Clark: Mr. Speaker, I shake my head in wonder at the attempts by the Prime Minister to work his way around the failure-and I take it the Prime Minister is now admitting it is a deliberate failure-to apply the conflict of interest guidelines to an advisory agency such as the National Energy Board which, by statute, it is. I asked the Prime Minister a question. He did not answer it, although I can assume from his long evasion that his answer is that he intends to continue to exempt agencies like the National Energy Board with statutory advisory functions as long as he can find any way at all by which they can be called quasi-judicial agencies.
The Prime Minister has by his answers today drawn the attention of the Canadian people to a very large loophole which he and his colleagues have drawn into the conflict of interest guidelines. Just so he can confirm things, are we then to understand that these guidelines do not apply, for example, to members of the CRTC, the Canadian Transport Commission, FIRA, the Canadian Dairy Commission, Canadian
Oral Questions
Patents and Development Limited, the Canadian Pension Commission, the Northern Pipeline Commission and at least 15 to 20 other major administrative tribunals in the country? Is that the policy of the government?


Pierre Elliott Trudeau: Well, Mr. Speaker, the conclusion the hon. member reached in the first part of his question is exactly contrary to what I just said. If the hon. member would listen to my answers rather than preparing his next question, he might be able to dispense with some of his questions. He said that I was prepared to continue to exempt. On the contrary, I said that we had studied these guidelines, that we were hesitant to put them into effect, and that I was encouraged to see, until opposition members shook their heads, that the opposition was encouraging us to go ahead with such guidelines. This does not apply to the bill which will be introduced in the House today: it is on conflict of guidelines-conflict of interest guidelines.


Mr. Paproski:: Your first comment was correct.


Pierre Elliott Trudeau: It is on conflict of interest guidelines for members of parliament. The House will recall that all this business of publishing conflict of interest guidelines went through several stages. We started with ministers, then we went to members of parliament and then to officials. I indicated that we had not yet gone to holders of judicial or quasijudicial offices. That will be the next step. What I am indicating is that if we take that step, of course these members will be covered, but they will be covered for the future and not for the past.


Charles Joseph Clark: Mr. Speaker, the one absolutely unquestionably true statement the Prime Minister just made is that he and his colleagues are hesitant to put guidelines into effect. There can be no doubt about that.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: The Prime Minister has drawn our attention to this very large loophole which he and his colleagues deliberately wrote into the conflict of interest guidelines as they affect public servants; this "out" by use of the regulatory or quasijudicial cover. In the interests of giving some direction to people who might be associated with these agencies and might be contemplating leaving them, and indeed so there can be some standards set by the government, will he and his colleagues consider immediately this week in cabinet, today or tomorrow, some recommendation which they can bring before the House of Commons and the public so there will not be the kind of odour of evasion which is very clear about the National Energy Board case before us now?


Pierre Elliott Trudeau: Mr. Speaker, the words "odour of evasion" are quite unfair. I am absolutely convinced that Mr. Marshall Crowe, since we are talking about him, had no intention of evading guidelines.


Charles Joseph Clark: We are talking about you.

June 26, 1978
Oral Questions


Pierre Elliott Trudeau: When the hon. member talks about loopholes, there are no loopholes when the guidelines themselves indicate that they apply to certain persons and not others. If the hon. member had made himself familiar with the guidelines, he would have seen that indeed we proceeded through several stages and covered an increasing number of people. The people who hold judicial or quasi-judicial offices have not been included. I understand the House would like to see them included. I am indicating that the government is prepared to go that route. We thought it would be nice to have the opposition debate the bill which will be given first reading today, to give their opinions on it, and then we would know how far they are prepared to go regarding guidelines for members of parliament themselves.


Some hon. Members:: Hear, hear!


GATT NEGOTIATIONS ON AGRICULTURAL ISSUES
[Stage Direction]
Mr. Jack Murta (Lisgar) Mr. Speaker, my question is directed to the Deputy Prime Minister and President of Privy Council in his capacity to answer questions respecting our trade negotiations. Mr. Robert Strauss, the United States negotiator to the GATT negotiations now taking place in Geneva, has said there will be no agreement at the talks unless considerable movement on farm issue comes into being in the next few weeks. As far as the minister knows, have there been any improvements or movement on farm issues in terms of the main negotiating countries? If there has been movement, what implications do they hold for Canadian agriculture?
Allan Joseph MacEachen: Mr. Speaker, despite what Mr. Strauss has stated, I believe it is premature to forecast the pattern of proposals and counterproposals. There is dissatisfaction not only with the agricultural offers which have been made; there is dissatisfaction in fisheries and other related fields. In a sense, we are at a prenegotiating state. Recently at the meeting in Washington there was an understanding and the timetable was agreed to during which the period of June 30 to July 10 would be used intensively by the participants in order to develop a negotiating framework which might be put to the summit in Bonn later in the month.


Mr. Murta:: Mr. Speaker, perhaps the Deputy Prime Minister can be more specific on this question. One very important farm commodity is pork. Pork producers and their associations want greater access to international markets, especially the Japanese market. Since Japan tabled its offer list some time ago, can the minister inform the House if pork is on that list?


Allan Joseph MacEachen: Mr. Speaker, I do not have the list, but I can tell the hon. member that there has been considerable dissatisfaction expressed by quite a number of participants in the negotiations at the Japanese offer. Certainly, in the case of

Canada, it is not expected that we would be able to maintain our offer list to Japan or our offer list generally unless Japan improved its performance, which we hope will take place.


POST OFFICE
Mr. Wally Firth (Northwest Territories):: Mr. Speaker, my question is directed to the Postmaster General. It concerns the likely closure of the post office on Vale Island at Hay River in the Northwest Territories. The previous Postmaster General made some effort to prevent the closing of this post office. Can the Postmaster General report anything on this matter to the House? Specifically, will he do whatever he can to keep this post office open? It is an essential service to a few hundred people on Vale Island, including two or three government departments and a Crown corporation, namely, the Northern Transportation Company, Limited.


Hon. J. Gilles Lamontagne (Postmaster General):: Mr. Speaker, the question of keeping that post office open is still under consideration. In a way, we agree with the hon. member from the opposition that this is an essential service in Vale Island, and we are doing our best to try to maintain an adequate mail service.


TRANSPORT
Mr. G. H. Whittaker (Okanagan Boundary):: Mr. Speaker, my question is directed to the Minister of Transport. In view of the fact that there is a shortage of rail cars in the forest industry in the interior of British Columbia, that out of 786 cars which were ordered only 335 were received, and that this results in 100 per cent more lumber awaiting shipment from this very important industry of British Columbia, can the minister tell the House what he has done in reply to an appeal by the Interior Lumber Manufacturers Association to him and to the railways for more boxcars?


Otto Emil Lang: Mr. Speaker, I met with representatives of the forest industry in Vancouver several weeks ago to discuss this entire question. The existing situation is a difficult one in terms of numbers of cars. Even though, in the particular case of Canadian National, more products are being moved than last year, the waiting time for cars to be returned from the United States has increased very rapidly. This is largely because of changes in the situation in the United States. I discussed this matter with the railway presidents at a meeting last week looking into the question of whether more cars ought to be obtained immediately, in light
June 26, 1978

of the possibility that the American situation would be prolonged. They are looking at this question together with certain alternatives including the creation of lumber distribution centres in certain places in the United States. Perhaps that will allow the unloading of lumber and the return of cars to be handled in a much more expeditious manner.


AIRPORTS
Donald W. Munro: Mr. Speaker, my question is directed to the Minister of Transport. Can he bring us up to date on the plans of his department to instal radar at the only international airport in Canada which does not have radar, namely, the Victoria international airport? Can he give us some idea of the timing of the installation of that equipment?


Otto Emil Lang: Mr. Speaker, I have had no report of any change since the last time we discussed this matter. There are other airports where the numbers of landings and complications in terms of terrain and traffic are greater than at Victoria. Therefore, at this moment it is not at the top of our list.


Donald W. Munro: Mr. Speaker, is the minister aware that there has been an additional responsibility imposed upon air traffic controllers in Vancouver in that they are obliged, in addition to bringing aircraft into the Vancouver airport, to take aircraft to within the area of visual controllers in Victoria; and is he prepared to admit that this elevates unduly the fatigue threshold of controllers in Vancouver and thereby increases the risk in respect of security in that general area?


Otto Emil Lang: Mr. Speaker, the air administration at all times tries to take the workload of controllers into account in arranging the circumstances under which they work. I think the hon. member would have to agree that the workload situation in Vancouver, even with this additional responsibility, is not as great, for instance, as that of those who work in Toronto.



ROUTINE PROCEEDINGS


Allan Joseph MacEachen: Mr. Speaker, later today we will be giving first reading to the bill entituled the Independence
Korean Armistice
of Parliament Act. I should like to table, in English and in French, the proposed new Standing Orders of the House and Rules of the Senate relating to various aspects of conflict of interest of members of parliament.


ANTI-INFLATION ACT TABLING OF BOARD'S REPORT
Mr.   Ed. Lumley@Parliamentary Secretary to Minister of Finance: Mr. Speaker, pursuant to sub-section 17(2) of the Anti-Inflation Act I wish to table, in both official languages, copies of a report sent to the administrator by the Anti-Inflation Board.


KOREAN ARMISTICE AGREEMENT
Hon. Daniel J. MacDonald (Minister of Veterans Affairs):: Mr. Speaker, I am pleased to have this opportunity to inform hon. members that July 27 of this year will mark the twenty-fifth anniversary of the signing of the Korean Armistice Agreement.
This agreement was concluded between the United Nations Command, in which the Canadian forces participated, and North Korea and the Peoples' Republic of China. Canada participated directly in the Korean operations from June, 1950 until the final cease-fire in July of 1953. During this time Canada sent more than 22,000 troops to that Far Eastern theatre. A further 7,000 served there between the cease-fire and the end of 1955.
Of these brave Canadians who volunteered to serve half way round the world, 516 never returned. These men rest today in the soil of Korea and Japan, and are remembered here at home as their names are perpetuated in Canada's Korea Book of Remembrance.
As Minister of Veterans Affairs I am honoured to be able to lead a delegation of veterans of this conflict to the scence of their heroic actions. In July of this year this delegation will travel to the United Nations Memorial Cemetery at Pusan, Korea, to honour the memory of our dead in the presence of their comrades and their allies who fought by their side.
We are proud of our heritage and the sacrifice of our sons and daughters, and are always prepared to stand firmly in the company of other peace-loving nations for the preservation of international law and order.
Those we will commemorate gave their lives in the service of the first international police force. They did so that never again would another generation be called up to redeem their ideals and principles at so terrible a price.


Some hon. Members:: Hear, hear!

June 26, 1978
Korean Armistice


Mr. William Knowles (Norfolk-Haldimand):: Mr. Speaker, a few moments ago the statement just made by the minister was delivered to me. I find it fit and proper that the Minister of Veterans Affairs (Mr. MacDonald) should be leading a delegation of veterans to the scene of their former conflicts. I join with the minister in paying tribute to those valiant Canadians who lie in graves far beyond our borders. We pay tribute not only to the glorious dead but also to their fellow soldiers who returned home as members of our Armed Forces.
I think this points out and is further proof that Canada is willing to shoulder its share of the responsibility for maintaining world peace and in promoting world peace wherever there is potential trouble.
I trust that the minister will find that cemetery at Pusan, Korea, maintained in the same high degree of perfection that we found at the cemeteries in Italy, where I was privileged to travel with the minister a few years back. If that is not the case, I trust he will see that Canada makes every effort to have this cemetery looked after as it should be. Again, we in the official opposition join in paying tribute to our glorious dead who lie beyond our borders.


Mr. Max Saltsman (Waterloo-Cambridge):: Mr. Speaker, it is an honour as a veteran of one war to pay tribute to the veterans of another war. Although only five years separated the signing of peace following the Second World War and the beginning of the Korean War, those wars were worlds apart in many ways. In some ways the Korean War was an indication that total war is impossible. That war, in which Canadians fought under the auspices and direction of the United Nations, could probably have been ended more quickly with the dropping of a nuclear bomb.
What is significant about that war is the fact that the nations of the world realized that the use of nuclear weapons was no way to end a war. This was recognition of the fact that it is no longer possible to have total war. That war dragged on, and there were many more casualties. Many of the sacrifices represented a double sacrifice. Many lives were lost during the course of the war, and many additional lives were lost because of our determination to avoid a nuclear holocaust. In that sense the Korean War was a watershed.
When peace finally came it was not total peace, just as it had not been total war. The lesson was quite clear. It is no longer possible in a world so interconnected to have total war or attain total peace. At some point nations have to come together.
It is a great honour for me to pay tribute to those who participated in the Korean War, and to wish the minister and his delegation well on their trip to the scene of these soldiers' heroism.
[ Translation]


Joseph Adrien Henri Lambert: Mr. Speaker, I should like to thank the minister who sent me copy of the statement he has just made to the House recalling to memory the participation of Canada in the Korean war during the '50s. In

his statement, the minister mentioned that 516 Canadian troops died on the battlefield who are today buried in a cemetery the minister himself will visit sometime in July with a small delegation.
It is always with deep emotion that we evoke the memory of those Canadians who went away to fight on battlefields outside our land and who gave their lives to ensure the survival of the freedom we now enjoy. I think it is well to think of that occasionally, and to remember the participation of Canadians in the fight for our freedoms; to evoke it not so much for the people of our age but more specifically for the young who enjoy that freedom, and who at times abuse it, unaware, unfortunately, that those who came before them, some of whom were loved dearly, gave of themselves intellectually, financially and physically to guarantee that freedom.
I therefore take this opportunity to assure the minister of our co-operation on the occasion of this trip to Korea. I ask him to give a special thought to those Canadians. I know at least two whose names I remember, I can assure him that when he visits that cemetery our hearts will go with him remembering the fallen while at the same time asking Divine Providence, if it is not already so, to grant them real rest that is well deserved.


INDEPENDENCE OF PARLIAMENT ACT
Allan Joseph MacEachen: for leave to introduce Bill C-62, respecting the independence of parliament and conflicts of interest of Senators and members of the House of Commons and to amend certain other acts in relation thereto or in consequence thereof.


Mr. Knowles (Winnipeg North Centre):: Mr. Speaker, I realize that we do not often ask for an explanation of a bill on its introduction into the House by a minister, but I point out that Standing Order 68(2) provides for such a situation, as does citation 356 of Beauchesne's fourth edition. In view of the importance of this bill and the interest in the subject today, I believe the minister should be given an opportunity to give the House a brief explanation.


Allan Joseph MacEachen: Mr. Speaker, I appreciate the suggestion made by the hon. member, but unfortunately the bill is so comprehensive in its nature that it would require more than a brief explanation. Therefore, and not to do an injustice to this work, I would like to suggest to the hon. member that he read the supporting material, which I will make available to him just as soon as the bill is given first reading.
June 26, 1978


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

[Stage Direction]
On the order: Government notices of motion:
June 22-The Prime Minister-That a special joint committee of the Senate and the House of Commons be appointed to examine and report upon proposals that have been and in the future are from time to time made public by the Government of Canada, on subjects related to the Constitution of Canada;
That twenty members of the House of Commons, to be designated by the House at a later date, be members of the said committee on the part of this House;
That the committee have power to examine and enquire into all such matters as may be referred to them by the House, and, to report from time to time, and, except when the House otherwise orders, to send for persons, papers and records, to sit while the House is sitting, to sit during periods when the House stands adjourned, to print from day to day such papers and evidence as may be ordered by them, and to delegate to subcommittees all or any of their powers except the power to report direct to the House;
That the committee have power to adjourn from place to place within Canada; and
That a message be sent to the Senate requesting Their Honours to unite with this House for the above purpose, and to select, if the Senate deems so advisable, some of its members to act on the proposed special joint committee.
Mr. Speaker:: Pursuant to section 2 of Standing Order 21, this government notice of motion stands transferred to and ordered for consideration under government orders later this day or at the next sitting of the House.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Yvon Pinard (Parliamentary Secretary to President of Privy Council):: Mr. Speaker, the following questions will be answered today: 1,144, 1,513, 1,593, 1,621, 1,680 and 1,718.
I ask, Mr. Speaker, that the remaining questions be allowed to stand.


Mr. Herbert: Does the government consider that it has a direct financial interest in the agreement for the federal funding for minority and second language instruction and, if so, does this interest include a responsibility to (a) explain the intent of the agreement (b) obtain an accounting of the spending of such funds and make it public?


Hon. John Roberts (Secretary of State):: Yes. The hon. member is referred to the copies tabled in this House on April 7, 1978, of the letters exchanged between the federal and provincial governments regarding the federal-provincial program of bilingualism in education for the period from April 1,
Order Paper Questions
1974, to March 31, 1979, (Notice of Motion for the Production of Paper No. 49-Sessional Paper No. 303-3/149). Reference is made in the letters to the provinces of the direct financial interest of the federal government in the funding of these programs, (a) Yes. The hon. member is referred to the documents tabled in this House noted above, (b) Yes. The hon. member is referred to the documents noted above, and in particular to the sixth paragraph of the letter to the province of Quebec, and the fifth paragraph of of the letter to the nine other provinces, stating the federal concern that there be full accounting of federal funds provided to the provinces under this program.


Mr. Forrestall: In light of recent announcements that the St. Lawrence Seaway Authority will proceed with studies on extending the St. Lawrence Seaway season to eleven months, will the government give iron-clad guarantees to the taxpayers of Atlantic Canada that all costs of operating the Seaway for an eleven month season will be fully recovered from users as a precondition to proceeding with such a project and, if not, for what reason?


Otto Emil Lang: The St. Lawrence Seaway Authority advises as follows: the seaway authority will award a contract shortly for a study of the benefits that would accrue from a navigation season extended in stages to eleven months. So little is known presently about the relationship of benefits and costs that it is premature to anticipate any decision to extend the seaway season. The government is not in a position at this time to give the guarantees requested.


Mr. Beaudoin: Did the government pay any grants to the Orford Arts Centre in the eastern townships and, if so (a) what was the total amount (b) in what years were they paid?


John (Moody) Roberts: Department of the Secretary of State: Grants totalling $254,000 were made to the Orford Arts Centre as follows:
	Amount	Year
Jeunesses musicales du Canada (through the Centennial Commission)	$ 4,000	1972Federal contribution to the development of the "Man and Music" pavilion	$250,000	1972
Canada Council: The Canada Council has awarded the following grants to the Orford Arts Centre: For Canadian guest artists and teachers: 1976: $6,000; 1977: $9,934. For guest artists and teachers from other countries, under the Cultural Exchanges program administered by the Council for External Affairs: 1969: $15,700; 1970: $10,542; 1971: $11,290; 1972:

June 26, 1978
Order Paper Questions
$9,955; 1973: $5,313; 1974: $6,674; 1975: $9,925; 1976: $10,682; 1977: $4,480; 1978: $5,777.


Mr. Mitges: What is the policy of the CBC with respect to (a) multicultural programming (b) broadcasting in languages other than English or French?


John (Moody) Roberts: I am informed by the Canadian Broadcasting Corporation as follows: (a), (b) The CBC's policy on multicultural and multilingual broadcasting, dated September, 1973, reads as follows: "Canada comprises on the one hand two large linguistic and cultural communities, one of British origin and the other French, which give rise to the bilingual character of the country at the official level, and on the other hand a native population of Indian and Eskimo origin, plus first and second-generation Canadians and recent immigrants from many lands. While the presence of such diverse groups gives a multicultural character to the country, it also generates tensions and creates problems of integration, adaptation and understanding between the different communities. During the sixties when these problems became acute, the Royal Commission on B & B was assigned the task of examining the question and recommending solutions. In its report the commission put forward a series of measures designed to preserve and extend the presence of the French language and culture in many aspects of Canadian life. Volume IV of the report also examined the contribution to the Canadian mosaic of groups who are neither British nor French in origin and urged that steps be taken to preserve their heritage. In response to the recommendations contained in volume IV, the government announced in the fall of 1971 a policy of multiculturalism within a bilingual framework and stressed the importance of the ethnic groups and the quality of their contribution to the social and cultural life of the country. The Canadian Broadcasting Corporation, one of whose priorities is to contribute to the development of national unity, shares this general concern and recognizes the need to strengthen the ties between the various regions and between the different linguistic and cultural communities in those regions. By virtue of the policies arising from the directives in the Broadcasting Act and by reason of the ethnic diversity of its audience, the CBC has long practised a policy of cultural pluralism in its programming. It intends to continue to affirm and reflect in its programs the multicultural riches and multiracial characteristics of Canadian society in keeping with the corporation's obligation to "contribute to the development of national unity and provide for a continuing expression of Canadian identity". Schedule planners and program staff are expected to demonstrate continuing awareness of and sensitivity to this aspect of the CBC role. The corporation believes that recognition of the ethnic fact in its programs, by regular and frequent appearances by members of ethnic groups, by the inclusion of subjects in which they are keenly interested, by the systematic examination of prejudice, negative attitudes and even manifestations of hostility towards them, by an honest appreciation of the cultural values they bring to society and by

an explanation of their contributions to Canadian life, will reduce the feeling of alienation among these groups. However, the CBC will not engage in multilingual broadcasting on existing stations and networks, because in so doing it would be departing from the express priorities laid down in the Broadcasting Act to provide complete services in both official languages. The CBC makes an exception only for the original inhabitants of the country, the Indians and Eskimos, to whom the northern service broadcasts in several languages and dialects."


Mr. Brisco: What is the best estimate of the amount spent by the National Museums Corporation in the constituency of Kootenay West from July 22, 1977 to date?


John (Moody) Roberts: In so far as the
National Museums are concerned: National Museums expended approximately $24,000 in the constituency of Kootenay West from July 22, 1977, to date.


Mr. Brisco: Are the same tax write-offs allowed for greenhouse agricultural projects, such as the growing of tomatoes, as are allowed for field grown products outside of a greenhouse environment?


Mr.   Ed. Lumley@Parliamentary Secretary to Minister of Finance: Different types of expenses are incurred in different types of farming businesses but, generally speaking, there is no distinction made between the tax treatment of write-offs and expenses incurred in growing products in a greenhouse and the tax treatment of write-offs and expenses incurred in growing products in the field.


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



POINTS OF ORDER


Mr. Benno Friesen (Surrey-White Rock):: Mr. Speaker, again I would refer the parliamentary secretary to question No. 1,306 which I submitted in February. I have asked on two different occasions if he could expedite the answering of this question and the sub-questions under No. 1,306. I cannot imagine why he would hesitate to have them answered, but I urge him since, presumably, this is the last week that the House will be sitting, the he provide an answer for me this week.
June 26, 1978



MR. BEATTY-DELAY IN ANSWERING QUESTIONS NOS. 1,233, 1,236 AND 1,237

Henry Perrin Beatty: Mr. Speaker, I would like to invite the parliamentary secretary to join with me in celebrating the six months' anniversary today of three questions which I placed on the order paper on January 26. I refer to questions Nos. 1,233, 1,236 and 1,237. I suggest to the parliamentary secretary that a good way of making the celebration much happier would be for him to answer the questions.



MR. MCKENZIE-DELAY IN ANSWERING QUESTION NO. 895

Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, I too have a complaint for the parliamentary secretary about a question I placed on the order paper on December 7, 1977. This is the fourth time I have requested an answer for this question, which refers to the number of government members allowed to use the MOT telex to send political messages. It does not take seven months to compile that information, and it is becoming quite obvious that this is some kind of cover-up on the part of the government, and particularly on the part of the Minister of Transport (Mr. Lang), who seems reluctant to reveal this information. Nevertheless the question has been accepted, and it is ridiculous to wait for so long to have a question of this type answered.


Yvon Pinard: Mr. Speaker, concerning the three remarks which have just been made, I would like to tell the House that I shall consider them very seriously and check the progress in our research work to give as usual the most accurate, detailed and acceptable answers possible. I want to take the opportunity to underline that we have an excellent average of answers with regard to the question rate, and that this week, we are going to make a particular effort to improve this average.


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


Some hon. Members:: Agreed.



MOTION TO ADJOURN UNDER S.O. 26   INDUSTRY CANADA-U.S. AUTOMOTIVE AGREEMENT

John Edward Broadbent: Mr. Speaker, I ask leave, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles), to move the adjournment of the House under Standing Order 26 for the purpose of discussing a
Auto Pact
specific and important matter requiring urgent consideration, namely, the crisis in the implementation of the Canada-U.S. Automotive Agreement as reflected in the cumulative trade deficit for Canada of $7.5 billion since 1965, which has resulted in the net loss to Canada of 25,000 jobs, and to which the Government of Canada has responded by making an offer of $37.5 million to induce Ford of Canada to expand in this country, such action being revealed in the legislature of the province of Ontario on Friday, June 23, 1978.


Mr. Speaker:: The hon. member, pursuant to the terms of Standing Order 26, gave the Chair appropriate notice of his intention to make this application at this time. Without going into elaborate reasons, I want to indicate to the hon. member that I will not be granting the application for consideration pursuant to Standing Order 26.
The hon. member has spoken in his motion of the crisis in the implementation of the Canada-U.S. Automotive Agreement and goes on to indicate that they are developments which have occurred in a gradual way over the 13 years since 1965, the beginning of the effect of that agreement. There is also the allegation of the loss of jobs, and that is one area I certainly think is a chronic and continuing problem and not the proper subject matter for the provisions of Standing Order 26. In the latter part of his motion the hon. member refers to an offer of $37.5 million to induce Ford to come to Canada, that offer having become known in the Ontario legislature last Friday. At the moment the circumstances surrounding the last part of the hon. member's motion seem to be a matter of dispute, and somewhat uncertain.
I do not think that the rule is meant to apply to areas in which the centre of the matter is one which in itself is a matter of dispute, but I do not want to eliminate for all time that possibility. It seems to me that the rule is intended to apply to circumstances which are in themselves not subject to interpretation. Whether or not parliament is responsible for them or can do anything about them, I do not think we ought to use this rule to apply to circumstances where the crisis in itself is subject to argument or disagreement. Certainly, in answers given in the question period today, there seemed to be disagreement on the very circumstances which would form the core of this motion.
It may be that further facts and later exploration through the week and days to come will indicate that, indeed, the hon. member has a legitimate case, and I would not rule out the possibility of a new application under those circumstances. But I certainly think that it would be very premature for the Chair to come down on one side or another on an item which remains in some considerable dispute. Therefore at this moment I set aside this application under Standing Order 26.

June 26, 1978
Export Development Act



GOVERNMENT ORDERS


[Stage Direction]
The House proceeded to the consideration of Bill C-36, to amend the Export Development Act, as reported (without amendment) from the Standing Committee on Finance, Trade and Economic Affairs.
Mr. Speaker:: Before calling the first motion to be considered among the six motions that appear on the order paper at this report stage of Bill C-36,1 do want to indicate that both in respect to the report stage of this bill and also the oil and gas measure which has been reported out of committee, we find a similar report stage motion. It is motion No. 5 standing in the name of the hon. member for York-Simcoe (Mr. Stevens). In the other case, the oil and gas measure to which I will refer in more precise detail in a moment, the amendment was in fact made in the standing committee and has been reported, not in the name of any individual member, but as an amended part of the bill. In both cases the attempt is the same, that is, to bind future parliaments to make an automatic order of reference, in this case of a report, and in the other measure, of the act itself.
I invite hon. members to examine these provisions and, when we come to them, to be prepared to argue whether parliament can go further than ordering, in proper procedural terms, a re-examination by parliament or, in the case of a report, order that the report be filed with parliament, and whether an amendment to a particular statute can go further than that and indicate what will happen to a report when it is in the hands of parliament at a future time. It seems to me that in this case there might be an argument that the Standing Orders of this parliament can be amended to accomplish the purpose which the hon. member for York-Simcoe has in mind.
In respect of the other measure, which I only mention peripherally now-we will obviously have the same problem before us more than once and therefore I mention the same argument in respect of the other matter-it is not even a question of a report, it is the referral of the entire statute to a committee which might or might not be in existence, and which is not accurately described. Similar language is used in motion No. 5. The committee is referred to as the committee to which ordinarily things on this subject matter are referred.
When we get to motion No. 5 and think it should be subject to argument, I hope that argument will be helpful to me in making a decision. But I question whether, by amendment to a statute, we can affect the operation of future parliaments, not in having the matter reported to parliament but in having parliament carry on further with it in an automatic way and make an order of reference of that material to a committee, when in fact the committee is not even named. I do not say in an absolute way at this time that it cannot be done, but it

seems to me to be a very dangerous practice to attempt to describe it in a motion.
I do not see any difficulty in the motions that have been introduced in the past where an automatic process of review is proposed. What comes to my mind, for example, is the antiinflation legislation where, by way of amendment, a review process was introduced so that a report had to be made to parliament; or parliament, as a result of the action of a certain number of members, was able to call into review the operation of the statute. That seems to be a provision which has been accepted in the past.
Certainly there is no argument about statutes which call for a report to be made to parliament, or a report, having been made public, to be filed with parliament. There is nothing the matter with that, but I question whether or not a motion can go one step further and say that when parliament gets it, it must automatically do something with it. In the first place it seems to me that if that can be done it will have to be very specific, and second, if it can be done it would have to be done by an amendment to the Standing Orders, which are what govern our process of reference to standing committees.
Therefore, I invite the hon. member who has sponsored motion No. 5, who is here in the House now, as well as other hon. members, to examine this matter and to give it some thought to see if, when we come to motion No. 5, some argument can be advanced which would dispel my fears that the matter cannot go ahead on procedural grounds.
With respect to the other five motions, I have no difficulty with them from the procedural point of view. Motions Nos. 1 and 3, in the name of the hon. member for St. John's West (Mr. Crosbie), seem to me to have a similar intention and therefore should be grouped for discussion, and the vote on motion No. 1 should also dispose of motion No. 3. Similarly, motions Nos. 2 and 4 should be grouped for debate, and the vote on motion No. 2 will dispose of the vote on motion No. 4. Motion No. 6 in the name of the hon. member for Nickel Belt (Mr. Rodriguez) should be debated and voted on separately. Again these are the suggestions of the Chair for the disposition of the report stage of the bill. If there is any disagreement with those suggestions, I would be glad to hear it.
Now we can proceed to motions Nos. 1 and 3.


Mr. Stevens:: Certainly, Mr. Speaker, I will be preparing further comments in anticipation of us reaching motion No. 5, but I would call Your Honour's attention to the Air Canada bill which was recently passed because it has an identical provision to the provision we are proposing in motion No. 5 with respect to the Export Development Corporation, and in fact the wording we have used in motion No. 5 was plagiarized, if you like, from the wording which apparently was approved with respect to Air Canada. In that case there was a permanent reference to a committee of the House considering transportation matters, so I would ask Your Honour to consider in the interim the arguments that were raised at the time of the Air Canada amendment which, as I said, was passed by the House.
June 26, 1978


Mr. Speaker:: The hon. member for York-Simcoe has raised a valid point. We are aware of the Air Canada example and of the occasions on which attempts of this sort have been made with respect to a particular statute. However, that does not eliminate the concern that I have about it. I recognize the precedent which the hon. member for York-Simcoe has cited. However, I do want to sound a note of caution with regard to what we are attempting to do. It seems to me that we are regularly attempting to amend the Standing Orders of the House by virtue of an amendment to a statute, and I have some misgiving as to its validity and, in any case, to its procedural regularity. But we can discuss that again when motion No. 5 is reached.


Stanley Howard Knowles: Mr. Speaker, like the hon. member for York-Simcoe (Mr. Stevens), I accept the arrangements you have made regarding the six report stage motions, in particular the groupings you have made which seem to be appropriate. I am glad you have left until later a discussion of the procedural admissibility of motion No. 5. I have sent to the Library for the Statutory Instruments Act. It seems to me there is something in that act which says that certain items stand referred automatically to a certain committee. However, we can deal with that when we get to the point later on.


Mr. Speaker:: Hon. members will understand that the reason I sounded a note of caution with respect to this motion, despite its similarity with the other two examples that have been cited, and others, is that the trend has already become more severe, and with respect to the other measure there is now a reference not of a report but in fact of the statute, the act itself. It seems to me that has gone one step further, and therefore 1 am beginning to question the validity of the process, both from the procedural point of view-which is of course my only concern-and because I would like hon. members to re-examine it to see if we are heading in the right direction. In any case, we should now consider motion No. 1, which is in the name of the hon. member for St. John's West, and which should be taken together with motion No. 3 for discussion and for a vote.


John Carnell Crosbie: Motion No. 1.
That Bill C-36, an act to amend the Export Development Act, be amended in clause 3 by striking out line 24 at page 2 and substituting the following therefor:
"equal to six times the authorized capital of'
Motion No. 3.
That Bill C-36, an act to amend the Export Development Act, be amended in clause 4 by striking out line 21 at page 4 and substituting the following therefor:
"equal to six times the authorized capital of'
He said: Mr. Speaker, the two motions that are now being discussed together would have the effect of amending the bill now before us so that the expanded limits which the government is suggesting for the Export Development Corporation to grant credit, to make loans or to give guarantees, would be less than the government has sought.
Motion No. 1 deals with the question of the authority of the EDC to establish a ceiling for its contingent liabilities and
Export Development Act
corporate account, its own account. Until this legislation passes the House, whenever it does pass the House, the limit on the contingent liability which the EDC can incur is $2.5 billion. The government is suggesting that this be increased to $10 billion, a fourfold increase. My amendment suggests that the limit be set at $6 billion, that is over double what the present limitation is now. We are suggesting an increase from $2.5 billion to $6 billion, which gives enough leeway and discretion to the corporation.
The second motion we are dealing with at this time would have the same effect as the amendment proposed by the government. They want to remove guarantees from the ceiling on loans made by the EDC on its own account at the present time without any legislation or any bill amending the act passed. The limit is $4,250 million. The government is suggesting that the EDC should be given the right to loan up to $10 billion without coming back to this House. We are suggesting that the limit should be set at $6 billion, which would be a considerable advance on the present limit. There are two other motions to the same effect, Mr. Speaker.
Why do we do this? Why are we suggesting this? It is because this is a government agency that has considerable power and is exhibiting the fact that it is not prepared to exercise that power with moderation. We all know that Canada has to have an export financing agency, that we have to assist financially in Canada exports to other countries in the world, that we have to meet the competition. Therefore, an Export Development Corporation is needed. We all know that the United Kingdom has an export credit guarantee department, and France and the other countries of the world have their various export financing agencies. Canada has to have one too. But, Mr. Speaker, there are many reasons why we believe that this agency has to be kept under closer scrutiny by this House of Commons and this parliament.
Some of those reasons were expressed by our leader in a speech on second reading of this bill on April 27. What I want to do is refer to the points made then by the Leader of the Opposition (Mr. Clark) on behalf of the official opposition and show what has happened since to bear out the points made by him when this bill went to a committee of the whole House, and therefore to advance the reasons why we believe these limitations-the limits on lending authority and guarantee authority-should be more restrictive than the government proposes.
Let me just say this that when the Minister of Industry, Trade and Commerce (Mr. Horner) was in committee-he is not here today, I suppose he is on other business, but it is a coincidence that he was on other business when second reading of this bill was going ahead and I spoke in the House, and he is not here again this afternoon, I understand he is in Toronto on some other kind of government business, I suppose he will be back before the debate is finished-he said that if this legislation was passed in the form it now is, the EDC will have sufficient lending and guaranteeing authority to operate until

June 26, 1978
Export Development Act
1983. Nineteen eighty-three, of course, is five years from now. It does not have to come back to us in the estimates if it gets its funding from non-government sources.
It means it would not have to come back to us until 1983 to get these limits established or expanded again. We believe that that is far too long a period.
It was suggested by the president of the corporation that they might have to come back in three and a half years' time. Even a three and a half year period, in our view, is too long. We need some assurance that this corporation is going to come under the scrutiny of this House of Commons or its committee every year. The people who are running this corporation have amply demonstrated the fact that they need to be under someone's scrutiny. They suffer, according to the evidence that came before our committee, from what the Greeks call "hubris", insolent pride or over-weaning pride, and it is going to lead to their nemesis unless they come under closer scrutiny by this House.
We know that the financing and the gaining of exports are only part of what we need here in Canada to overcome our economic problems. The problem is that the government has no over-all policy. The only policy that the government seems to have is to have EDC finance exports madly and competitively, and try to get all the exports we can without worrying about the type of exports. Manufactured end products are not being exported in any great quantity, it is mostly raw materials and semi-processed goods, and 70 per cent of our exports are to the U.S. anyway.
The government has overlooked the fact that in addition to increasing our exports we need to be more competitive so we can decrease our imports, Mr. Speaker, and that we can exercise import substitution so that we can see Canadian manufacturing industry produces more of the manufactured end products in order that we do not have to be importing huge volumes of manufactured and products, which caused a deficit in that area of $11.5 million last year. There is no over-all strategy.
I want to refer to some of the points that were made on second reading of this bill, particularly by our leader when he spoke on April 27, and then to see where some of these points were borne out in the evidence that came before the Finance, Trade and Economic Affairs Committee of this House.
The first point that our leader made in his remarks on April 27, is reported in Hansard at page 4925, and reads:
I personally have been alarmed at the performance of information officers of the Export Development Corporation, which very much borders on the partisan-
That was a matter well borne out in the committee in the way that the EDC has conducted itself in its public relations in recent years, its political partisanship. For example, in the January-February 1978 issue of EDC News-here is a Crown corporation putting out a bulletin paid for indirectly by the taxpayer-on the second page of that bulletin practically the whole page is taken up with an article entitled "EDC Answers MP's Charges," They go on to cite the hon. member for Victoria-Haliburton (Mr. Scott) who had had an article in

some local newspapers calling for the abolition of the EDC, and answering points they said he made, and identifying how they thought he was in error.
That matter also came up in committee, the matter of the EDC taking it upon itself to involve itself in the political in-fighting that goes on, and must go on in our system. That, Mr. Speaker, was something that should have been left to their minister to do if he thought it worth doing. If he thought the EDC needed to be defended politically, it was for the minister to do that, not for a Crown corporation to undertake that job itself through its public relations officers.
When the minister was before the committee and he was questioned on that and or other incidents such as the public relations officer for EDC actually writing to a newspaper out in the district of the hon. member for Kootenay West (Mr. Brisco), actually writing letters to the editor replying to some statements that the member for Kootenay West made in this House-they had actually sent letters to the paper repudiating or answering arguments that he had made. It was put to the minister when he was before the committee that this corporation was dangerously involving itself in the political sphere. The minister was good enough to admit that perhaps he should have authorized the letters, and signed them. He gave an indication that my criticism was accepted and that the chairman was there and had heard the criticism. It would be taken note of that the political affiliation of anyone misconstruing, he said, the department's good work would not be mentioned from here on in. That is found in Issue 28 of the committee at page 28:9.
Later in the proceedings of this committee the president of the corporation himself, the man who exhibits dangerous signs of arrogance, did not appear prepared to take the advice of his minister in this direction. He felt there might be certain occasions when he would have to defend the EDC that could not be left up to politicians I suppose such as the minister, who might not able to do a capable enough job defending them- that was the implication. He seemed to be taking the position that it still might be in order for them to engage in this kind of partisan debate. That is one of the reasons why this agency needs to be closely watched by this House-the kind of article which we saw in the January-February EDC News that I hope we will not see again.
Along the same lines we have certain political advertisements that have been appearing, on the Export Development Corporation. I would like to refer to Issue 29 of the committee where that is also mentioned. The EDC has had quite an ad campaign under way in recent months in this country. It is peculiar that the timing coincides with the fact that the legislation was coming before this House.
Questions were asked as to what was the advertising budget for the Export Development Corporation. It is quite interesting to see what happened. In 1973 this Crown corporation spent $1,500 on advertising. In 1974 that jumped to $12,100. In 1975 they went berserk and went to $161,000. In 1976 there was a slight reduction; they spent $128,000. Perhaps the
June 26, 1978

political pressure was off. In 1977 their advertising budget went to $240,000.
In 1978 this Crown corporation, this servent of the people, spent $177,000 in the first five months of the year, up to the end of May, on advertising. Therefore I would guess that this year they are going to spend well in excess of $300,000.
Why is that money spent? Everyone in business in this country knows that we have an Export Development Corporation and that, if they want to export, they can get financial help from the EDC. If they do not know that, the EDC has easy methods of letting them know, going through the classified business directories and sending out information and notices. They do not need to have ads in the daily newspapers to make their activities familiar to businessmen.
What do we have? We have a press campaign across this country. I have here an ad from the Ottawa Journal, Thursday, June 8. Every paper in this country has this kind of propaganda exercise by the Export Development Corporation, exporting its jobs for people like you and me. That is the name of the campaign. It is on a par with the Liberal party propaganda. I quote:
That's right, Dan Siminiuh, millions of Canadian jobs depend on exports. And it's Export Development Corporation's job to finance and ensure export sales that help generate employment at home.
It goes on to say some of the things they do. This is to give the impression that millions of Canadian jobs depend on the EDC and therefore depend on the government which controls the EDC. That is what that ad is supposed to create in the minds of the Canadian people.
I have other examples here. There is a hole supplement in the Financial Post of April 29, 1978. 1 just happened to coincide with a second reading debate in this House when the minister had us under pressure to pass the legislation before we even had a good chance to look at it. There is a whole supplement in the Financial Post. "EDC predicts 1978 banner export year." Do you know what that supplement cost, Mr. Speaker? That supplement in the Financial Post cost-


An hon. Member:: How much?


John Carnell Crosbie: That is what I am looking up now. The hon. member wants to know how much. He is going to find out how much. He will get the information here today. He will not get it from the minister because he won't ask the minister. We are going to tell it as it is. He wants the Financial Post so we will look it up for him. Page 31(4).
The cost of the EDC News, by the way, was $5,500 for the last six issues. That is the average. The cost of the Financial Post advertisement was $20,872.54. That is what the cost of that was. Therefore, we have this kind of malarkey, this kind of political puffery, advertising across the country to coincide with the hoped-for election this year. At least we all thought there was going to be an election until the Prime Minister (Mr. Trudeau) got his feet so cold that his toes curled up and disappeared.
Export Development Act
Here is another ad which they had in the paper:
Julia Noel works for Canada Wire and Cable Ltd. in Toronto. Julia and 2,600 other people across Canada turn out products sold to about 65 countries and supported by EDC insurance and other financial services.
That's their calculated design. That is there to give the impression that all 2,600 people who work for Canada Wire and Cable Limited are dependent on EDC for the work they do. In other words everything that Canada Wire and Cable sells around the world is financed through EDC. If EDC was not there, those 2,600 people would be out of their jobs.
That is the kind of secular advertising that this Crown corporation is doing. It is exporting its jobs for people like you and me. That's right, Julia Noel. Don't tell Julia because you won't fool her.
That's right, Julia Noel, millions of Canadian jobs depend on exports. And it's Export Development Corporation's job to finance and ensure export sales that help generate employment at home.
That is to give the idea that all of our exports are financed through EDC.
You may not work for a company that exports directly. But chances are some of your company's products or services are used by others who do.
I do not have the time today to delve into all the iniquitous phrasing and wording in this iniquitous ad, which has been paid for by the taxpayers' money, while trying to put pressure on us when we are considering this legislation.
Here we have a Crown corporation suffering from a rush of arrogance and pride to the head, which spent $12,000 on advertising in 1974, spent $240,000 last year, and $177,000 in the first five months of this year. Is it any wonder we want them to come under our scrutiny and control? Is it any wonder we consider them the agency of the Liberal Party of Canada? We will change that after the next election. They will find out what party they are agents for.
That is ample support in these hearings and ads which I produced to the House today for the fact that this corporation is not acting as a Crown corporation should. It is too partisan, has been too partisan, is misusing advertising funds, and is spending too much on advertising. It is trying to cod and fool the public into believing that it finances all Canada's exports and you have to thank EDC if you work for a company or in a job that is connected with advertising. That is one point made by our leader amply borne out.
The second point he made was with regard to financing of EDC. The government has been boasting that it does not have to finance EDC, that it does not have any money in the estimates for EDC. This wonderful EDC finances itself. It can go to the bond markets and borrow money. They say it is not on the taxpayers' back at all.
I say it is like a monkey on the taxpayers' back. Every taxpayer in this country has a little EDC monkey on his back. That is where they are. Never mind that it can borrow from sources other than the government. It can borrow from sources other than the government, but why?
Our leader pointed out that the government says that loans to the EDC are not direct obligations to the taxpayers of

June 26, 1978

*m
*m
Export Development Act
Canada. We agree they are not. If the EDC borrows money from some source not involving the government or direct government guarantee, that is not a direct obligation of the government. However, as our leader pointed out, it is incorrect not to reflect their borrowing in our national accounts.
Let us check and see if our leader is correct. If he is not, we on this side are willing to admit it. We are very willing to admit it. We have never come across an instance yet but, if we do, we will admit it.
Let us look at issue No. 29 of the Finance committee, page 29:18. Here we have the president of the corporation, Mr. MacDonald, answering questions. I am questioning him on borrowing and so on and so forth, borrowing short term and long term. I quote:
Are they lending the money just to you, EDC, or is there any government involvement in the guarantee of repayment of that money?


Daniel Joseph MacDonald: There is no guarantee, Mr. Crosbie, but we are clearly looked upon as a Canada credit, and we benefit from that.
EDC borrows the money because they are looked on as a Canada credit. I quote from further down that same page:


The Chairman:: Did you say you had the backing of the Consolidated Revenue Fund?


Daniel Joseph MacDonald: We have a legal opinion that says the corporation is an agent of Her Majesty, and that, in effect, makes us a Canada credit. But it is not a formal guarantee.
That is the president of the corporation stating he has a legal opinion that EDC is a legal agent of Her Majesty. When the EDC borrows money, it is the same as the Government of Canada borrowing money. It is the same as taxpayers borrowing money. If EDC does not repay the money, the Government of Canada will have to repay the money. We, the taxpayers, will have to repay the money.
The government is trying to pull the wool over the eyes of the taxpayers of Canada when it does not show the loans to EDC in the national accounts because the government has not formally guaranteed those loans. It does not matter where EDC borrows the money, it is borrowing it for you and me. We do not see that in their ads, Mr. Speaker. We do not see them putting that in the Financial Post. We do not see this statement in the Financial Post, exporting its debts to people like you and me. We are going to have to repay them. We do not see the EDC advertising that fact.
Once again, right from the horse's mouth, the mouth of the president of the corporation, we find confirmed that the corporation is an agency of Her Majesty, and that when the corporation borrows money it is the same thing as the government borrowing money. The government stands responsible for it. Again, the second point made by our leader in his speech of April 27 is borne out by what went on in committee.
Our leader made a third point, a point that many of us on this side have made, including members of the NDP, the unofficial opposition, or whatever they are. Our leader pointed out that we are realizing some short-term gains for Canada in terms of encouraging exports, but we are also gathering for this country very serious long-term harm. He said:

What is happening 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 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.
In other words, Mr. Speaker, the EDC, with glee and wholesale abandon, is financing pulp and paper mills and mines and the like about the world, using Canadian credit and money, without a thought of any kind to the long term consequence for this country. Every time we make this point to the government, or the hon. member for Nickel Belt (Mr. Rodriguez) makes this point-and he is much exercised about it-the only answer given is: "If we don't finance it some other nation will." That is no answer.
Why should we use Canadian money and Canadian credit to help build abroad pulp and paper mills which will perhaps put our own pulp and paper mills in Canada out of work? Even while the committee was sitting we saw a fantastic example of this very thing. This is how arrogant that group over there is, Mr. Speaker. Even while we were considering this very issue, the government made a $47 million loan agreement to support construction of a newsprint mill in Virginia. It was signed in the third week of May. The money will support the sale of Canadian equipment and construction services in Quebec and Ontario. It is being loaned to Bear Island Paper Company, a limited partnership which includes the Washington Post. In other words, people who now buy Canadian paper and pulp and paper products will no longer buy it because we are helping them to finance and produce pulp and paper in their own country. Is that short-sighted or is it not, Mr. Speaker? We say it is.
When Mr. MacDonald and the minister and his officials are asked about these things, all we meet is the same tired old refrain: "If we don't finance it, if we don't do it, some other country will." Well, I say let some other country do it. Why use our money? Let us use our money here in Canada.
Just let us see the confirmation of what I say in the committee hearings. At page 31 of issue No. 29 we discover that EDC has never turned down any loans or deals. Here is the statement:


John Carnell Crosbie: Have you turned down any loans or deals at any time because you thought that in the long run it is not in Canada's interest?


Daniel Joseph MacDonald: No, because we judged it would be in Canada's interest to export rather than cut our nose off because we could not prevent them having the project anyway.
Never had EDC turned down any deals because the corporation thought it would be in our long term interest to do it. In other words, they are short term thinkers. They are short-sighted. They do not consider the long term. It is fantastic, Mr. Speaker. They do not even consider the long-term future of Canadian industry when they are making these loans. I nearly dropped from my seat when Mr. MacDonald said they had never turned down a deal because in the long run it might not be in Canada's interest.


June 26, 1978

In issue 36 we see the same kind of answer in connection with the Virginia mill I mentioned a few minutes ago. This is my question as reported at page four of issue 36:
My first question to Mr. Horner or Mr. MacDonald is that before this agreement was entered into, was any examination made of what effect this has on the long-term prospects for Canadian newsprint sales in the United States, or was any consideration given to that at all?
Mr. MacDonald replied:
Mr. Crosbie, naturally these questions arise but I think the fundamental point you have to understand, as we do, is that that mill is going to be built by the Washington Post and Dow Jones enterprise in Virginia no matter what we say.
That was his answer. Then Mr. Summer said, as reported at page 36:5:
Thus you could say that, through increase of competition, it will in fact compete with Canadian sourced newsprint.
The EDC admits that this new mill will compete with our newsprint. Consolidated Bathurst came in to discuss the issue with them and got the same flapdoodle, the same old baffle-gaff, the same old twitter-twatter that we all get: "If we don't do it somebody else will."


Steve Eugene Paproski: And Lalonde just laughs.


John Carnell Crosbie: I don't mind that. I like to see the minister laugh. He is normally of somewhat sober visage. I like to see him get a chuckle out of this while our jobs and future industry go down the coal scuttle. There is ample confirmation, Mr. Speaker, of EDC using billions of our money and credit while not giving a thought to our long term future at all. They never consider whether what they do outside may compete with Canada inside. Can you imagine what would happen if the people in the pulp and paper industry and in the mining industry got that through their heads? They would be storming the EDC's gorgeous offices. They would storm those glass towers over there which the minister occupies, that emporium, that beautorium. It is futuristic. The elevators are all glass so you can see who is coming after you and get out some other door. I assume that's the reason, Mr. Speaker.
Well, sir, there is no wonder we are moving these amendments. It is surprising that our amendments are not stricter.
Another point our leader made was that every year we should examine, through parliamentary committees, how EDC is fulfilling its mandate. Our leader said we need a full-scale, thorough, and calm review of all activities of the Export Development Corporation. Well, the committee meetings we held were not all that thorough, full-scale or calm. We did our best, but we were harried and harassed every step of the way by an obdurate government with a big majority trying to crush the thing through the committee. The hon. member for York-Simcoe (Mr. Stevens) one evening held off 12 Liberals by himself and saved the day for us.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: They tried to rush everything through. Imagine, 12 to one. But one Tory equals 12 Liberals any day, Mr. Speaker, except that we would like a few more in this House.
Export Development Act
Our leader in his speech on second reading also pointed out that we propose lowering of the ceiling. When he first came to our committee, the minister said he would consider that. It appeared to be something of a miracle-the Minister of Industry, Trade and Commerce was going to be reasonable for a change, that he would not continue exhibiting the stubbornness he has shown ever since he crossed the House last year. It appeared he would be reasonable and consider our amendments. But he came back full of hubris-if that's the word. He told us later: "No, I am not going to consider any of your amendments. We are putting it through the House." He had to have it. Closure! By God, he was going to do everything to get it through the House. Thank God we only have the rest of the week, Mr. Speaker. I wouldn't want him after me in his cowboy boots all summer if we don't get this through for him. So his reasonableness disappeared very quickly. I don't know why. We are hoping he is going to swing around and support these amendments today.
I would like to refer to something said by my hon. friend from York-Simcoe. I am perhaps treading on his ground here but it was so extraordinary that I hope he will touch on it too.
I want to refer to Issue 37 of the finance committee hearings, at page eight. The government is proposing a huge increase in the limits of the corporation now, but we really need to place limits on it, Mr. Speaker. Just listen to this. Mr. Stevens was speaking:
1 noticed that you said this power project may be $500 to a billion dollars. Is there some level beyond which you say you cannot go?
They are into the billion dollar deals now, but there is no level beyond which they say they cannot go on the lending side or whatever side, and I am sure that the hon. member for York-Simcoe will develop that a bit further. So that is another reason why we are suggesting stricter control over this corporation, Mr. Speaker, and any corporation of the Crown led by somebody who thinks there is no level beyond which they cannot go has got to be put under some kind of restraint. I would say anticipatory arrest would be the proper step to take so that this corporation does not continue thinking that there is no level beyond which it might not go.
Well, then, we get to another point that our leader made in his same speech on the second reading, and that was a point about the number of jobs created. I think that was mentioned by our leader. I just cannot find it. He mentioned sunset laws and so on. One of the points he made, or that we make, is the question of how many jobs this corporation is really creating because, Mr. Speaker, in its pride and in its political puffery, and in its political advertising and in its efforts to help the government in a partisan sense, this corporation claims that it is creating over 200,000 jobs a year.
That is what it says in its advertising, that it is creating
200,000	jobs a year. It is contributing to Canada. When that was challenged in the committee by the hon. member for Vancouver Quadra (Mr. Clarke), who I am sure will go into this a bit more, when he wanted to find out more about this, how they made these estimates, the minister said, "Well, what

June 26, 1978
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they always said was there are 200,000 jobs created or maintained". Not 200,000 new jobs. 200,000 created or maintained. He whacked in a few weasel words because he knew he could not support the 200,000 jobs. They said that they used to say "about", that they never claimed 200,000. This is the defence you will find in the evidence of our committee because we say we have no way of showing they created 200,000 jobs. So then their defence was, "Well, what we say is about 200,000".
Now, Mr. Speaker, I have in my hand here a document which gives the lie to that statement in the committee. Here is an advertisement that appeared in the Ottawa Journal on Thursday, June 8, 1978: "Exporting ... it's jobs for people like you and me". Down in the second paragraph it says:
Last year EDC financial support for Canadian export sales totalled $2.6 billion, which sustained or created work for at least 200,000 Canadians across the nation.
There is no "about" there. There is no shilly-shallying. They sustained and created work for at least 200,000, not about
200.000	or approximately 200,000. "For at least"-in other words, more than 200,000.
The hon. member for Vancouver Quadra, who is a chartered accountant, I believe, among his many other accomplishments, inveigled the president, Mr. MacDonald, to give us a document to show how they arrived at their calculation of jobs. Well, it wasn't jobs anyway, Mr. Speaker, it was man-years. It was 200,000 man-years they were talking about. Two hundred thousand man-years is not jobs. A job might last six months or 12 months and the man may be out of work again, but man-years is a different concept. It is like the Minister of Energy, Mines and Resources (Mr. Gillespie) who got up in the famous conference, the first ministers' con job conference, in February, and he said, "There is going to be one million jobs created in big energy projects". Eighty billion dollars, and there has not been one job created yet. He wasn't talking about jobs either. He was talking about man-years. He was talking about con jobs. Those are the kinds of jobs these people are talking about, con jobs. There are about 200,000 con jobs created by their advertising each year.
So they were asked to put in their calculations and show how they arrived at it. And, Mr. Speaker, it was laughable. It was tragic in the committee, the piffling nonsense that went as an exhibit to the committee to show how they arrived at the
200.000	jobs. I am going to leave the hon. member for Vancouver Quadra to deal with that in his bright, no-nonsense, chartered accountant manner that will show there is nothing like 200,000. That is a pure work of fiction. It is completely fictional, this 200,000 that is being advertised all across Canada. The Minister of Employment and Immigration (Mr. Cullen) would not have to worry about his department. He could close his department down if EDC were being truthful and correct. There would be 200,000 new jobs every year. He could shut her down, and we would save billions on the unemployment.
In issue 36, just to give you my evidence, at page 22 there is some discussion of the whole business here, and as the hon.

member for Vancouver Quadra pointed out, there was no method of arriving at the figure. Mr. MacDonald said:
-the breakdown, as I think that memorandum endeavours to explain, is the utilization of rules of thumb-
Perhaps it was 200,000 thumbs it was talking about, not
200,000	jobs. Have you ever heard such foolish baffle-gab in your life, Mr. Speaker? I will just read it again:
Mr. Clarke, the breakdown, as I think that memorandum endeavours to explain, is the utilization of rules of thumb, which are reasonably widely accepted, based on the work-generative effect of a million dollars of expenditure per industry.
Pure and simple Ottawa baffle-gab, but we are not fooled by baffle-gab, Mr. Speaker. We can see that that is meaningless nonsense and that they have no way of showing. Then he went on further down to say:
That is why we use the expression "about". I do not think we purport it to be a statistical head count; we said about 200,000.
In other words, it is pure fiction. Edgar Rice Burroughs, when he was thinking of Tarzan swinging through the trees, could just as easily have thought up this kind of baffle-gab "about 200,000". It was about 200,000 times Tarzan swung through the trees. "A statistical head count" of the minds. Did you ever hear anything like that, "rules of thumb"?
"Utilization of rules of thumb". Any time anybody tries to trap me into an answer when I don't know what I am talking about, I am going to get up and say, "Gentlemen, really we have to depend on rules of thumb here, and the statistical rules of thumb show that this, that and the other is correct". This man should be in politics, Mr. Speaker. It is easy to see where he is going when he leaves the Export Development Corporation. So that is the number of jobs created. One hundred seventy seven thousand dollars was spent this year on false and misleading advertising across Canada by this Crown corporation. It is a wonder we are not so nauseated that we are going to vote against this bill at third reading. I am hoping that the ministers here today will persuade their colleague to accept our amendment so that we can be sure this corporation will be back before our committee again before three and a half to five years is up so we can keep a check on them. We need a tight check rein kept on them.
We had heard that the Canadian Bankers' Association had written the Minister of Finance (Mr. Chretien) with a copy to the Minister of Industry, Trade and Commerce, making a submission as to how things might be changed with respect to EDC. We had understood that it contained some criticism and some suggestions for change, so we asked, "Can we see the submission?" Here was a committee of your House, Mr. Speaker, considering this bill, so we asked, "Could we see the submission from the Canadian Bankers' Association?" Well, the Minister of Industry, Trade and Commerce hopped from toe to toe and foot to foot and heel to heel, he hemmed and he hawed and he hoed, and he said he would take it under consideration. Two weeks later he took it under further consideration, and two weeks later he took it under more consideration, and he was worried what the Canadian Bankers' Association would think about it. Then he was worried what the
June 26, 1978

Minister of Finance would think about it. Then he was worried what his colleagues would think about it. Then he worried what he thought about it himself, and we went through eight weeks of committee hearings, and we never did see the Canadian Bankers' Association submission.
The Canadian Bankers' Association agreed for us to see it. They said, "If the government agrees for you to see it, it is fine with us." But then the minister said no, he didn't think the Canadian Bankers' Association did agree for us to see it, and he had not had time to call Mr. Frazee to see if Mr. Frazee agreed that we could see he. He didn't even believe that, and he never did get around to checking it, so we haven't seen it.
Now, Mr. Speaker, the bankers of this country made a submission to the government about the EDC, and we are considering legislation about the EDC, with a gigantic increase in its loan limits and guarantee limits, and no member of this House except maybe somebody in the cabinet-there might be one or two of them interested, or the Minister of Finance or the Minister of IT and C has seen what the Canadian Bankers' Association have suggested, so we are being asked to approve these huge increases in ignorance of that.


The Acting Speaker (Mr. Ethier):: Order, please. I regret to interrupt the hon. gentleman but I must inform him that his time has expired. Nevertheless, he may continue if there is unanimous consent.


Some hon. Members:: Agreed.


Some hon. Members:: No.


John Carnell Crosbie: I will be only a minute.


The Acting Speaker (Mr. Ethier):: I heard some hon. members say no.


John Carnell Crosbie: We have a lot of motions coming up, and we have lots of time to speak.


The Acting Speaker (Mr. Ethier):: Order, please.


Mr. Bill Clarke (Vancouver Quadra):: Mr. Speaker, I think it is significant that the first speaker on this side has been the hon. member for St. John's West (Mr. Crosbie) and the second will be myself. I am from Vancouver Quadra, and that indicates the Canada-wide concern which we think is being shown about this bill.
I think it would be useful on motions Nos. 1 and 3 to go through some of the history of the limits which have been set for the Export Development Corporation. This corporation is not even as old as the present administration under the present Prime Minister (Mr. Trudeau). The Export Development Corporation was established by an act of parliament on October 1, 1969. In less than nine years the corporation has shown the voracious appetite of the government for increasing figures. During this fiscal year the government will produce a larger deficit than the total budget for 1968, which was the first year the Prime Minister was in office.
Export Development Act
When the cautious little corporation, EDC, was set up in 1969, the authorized capital was $25 million. At this point that capital has been increased to $400 million. Now the government is proposing to increase that authorized capital from $400 million to $1 billion, which is more than double. I mention only the authorized capital because the proposal of the government, and therefore the amendments proposed, are named as multipliers of the authorized capital of the corporation. Similar increases are proposed in the insurance limits. They will be increased approximately four times, from $2,500 million to $10,000 million. The initial limits set in 1969 were $250 million. From 1969 to 1977 the initial limits were increased ten times, and now they are requesting an increase which would amount to another four times. Thus, 40 times the initial limits are being sought at this time. There has been a similar increase in the insurance on the government sector. The loans in the corporate sector have increased from $600 million in 1969 to the proposed $10,000 million, or ten times the $1 billion shared capital.
Why do we need these changes? I should like to refer hon. members to the list presented before the committee. It indicates the insured volume, and it is detailed by country. I will not bore the House with the list, but it is an impressive one. It consists of approximately five pages of countries, and the present insurance volume. During 1977 the total insurance in force was $1,445 billion, which is less than $1.5 billion. At that point the Export Development Corporation had a limit of $2.5 billion which was passed in 1977. Now they want us to increase that to $10 billion. It has taken all this time for them to reach $1.5 billion. Why do they now need to increase the limit from $2.5 billion to $10 billion? No evidence was adduced in the House or before the committee to justify that huge increase.
The other motion deals with the loans balances. I refer hon. members to page 30 of the Annual Report of the Export Development Corporation. It lists all of the export financing agreements signed from 1969 to 1977 under the authority of the board of directors. The signed agreements for those years total $4.3 billion. Only $2.5 billion has been paid out, and there have been repayments of approximately $700 million. The balance outstanding on these agreements and guarantees, at the end of 1977, was $1.8 billion. We are being asked to increase that limit. The existing limit is $4,250 million, but that is not adequate. With $1.8 billion outstanding, the increase being requested is up to $10 billion. So that anyone reading the motions will not be disturbed, the $10 billion is not referred to-it refers only to ten times the authorized capital, which is a nice way of soft-pedalling the enormity of the figures.
Repeatedly in committee the officials, the government and the minister were asked why the government, which is the sole shareholder, did not take up more of its shareholders' equity. Why does the government not buy some more shares, in other words? The current authorized capital is $400 million. According to the current annual report, the capital stock, of which

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four million shares are authorized, consists of one million issued shares which have a par value of $100 each. Simply that totals $100 million. Why does the owner of this corporation not subscribe the other $300 million? Why should it expect to increase its financing or request increases in other limits when the owner of this business is not willing to put forth the rest of the money it promised to invest?
The committee received some very fancy explanations, none of which made any sense to me as an accountant and businessman. For example, one explanation was that the government, under the rules of its association with EDC, was allowed only to make certain purchases in relation to a certain formula. It would be easier to change the formula. The government should show faith in this corporation and its business by increasing its shares and its investment.
I should like to deal with the value of EDC as far as jobs are concerned. The hon. member for St. John's West told the House a few minutes ago that the government continually referred to this 200,000 job figure. We asked and asked, but could not find out how the government justified the 200,000 jobs. Finally, the government produced a two page document entitled "The Method of Estimating the Number of Man-Years of Employment Maintained and Created, Directly and Indirectly as a Result of EDC Support". Apparently this document was drawn up on the spur of the moment. It bears no authentication of having been produced by the corporation or any of its members or employees.
I should like to refer to some of the terms used by the government in arriving at the 200,000 figure. How does the government justify its claim that 200,000 jobs are created in Canada by EDC? The introduction of this paper refers to
200,000	man-years of employment. There is a definition of "man-year" which reads as follows:
A man-year is a measure of employment which is the equivalent of one person working for one calendar year.
The hon. member for St. John's West pointed out that man-years does not necessarily equal jobs. At times there can be more jobs than there are man-years. If a man receives a job for less than a year, it is not that much good to him. The piece de resistance of this document is the method of calculation, which reads:
The total number of man-years is determined as follows: the initial analysis is based upon labour generation shown by the exporter in the loan or insurance application.
Anyone requesting financing from EDC is bound to err on the generous side in order to make his application more acceptable to the government which hands over the goodies.
The next paragraph states:
The subsuppliers' contribution is based on the value of Canadian goods and services reported as part of the Canadian content assessment conducted by EDC staff prior to consideration of the particular transaction by the board of directors. In cases when information is not readily available from sub-suppliers, a factor involving various industrial indices is estimated on the basis of the professional judgment of the Engineering Advisory staff of the corporation. This in turn is founded upon experience and knowledge of the particular sectors 
involved. The factor can vary, of course, by province, region and company. A further estimate is made of the indirect employment (measured in man-years) that is created by the transaction. The method employed is to multiply the value of the exporter's commercial contract by a job factor. These factors are obtained from a report prepared by the Government of Canada "Employment and Occupational Impacts Using the Version III Interprovincial Input-Output Model". These in turn are tested against other information provided.
I hope the House has some better success than I did in trying to figure out what that paragraph says. I want to point out to members opposite, in case they thought they understood what was said, that there are so many indefinites and so many variables included in this paragraph that reliance on the figures produced by these arithmatic gymnastics would be questionable, indeed.
Here are some of the words I read a minute ago, and I will just repeat them to indicate the variables the government is relying on in coming up with this 200,000 figure which we question. First of all it says it "is based on the value... reported as part of the Canadian content". It states that if "information is not readily available ... a factor involving various industrial indices is estimated on the basis of the professional judgment". That is another indefinite. Then it says "This in turn is founded upon experience and knowledge of the particular sectors involved. The factor can vary, of course, by province, region and company". There are three variables in the one sentence there. It goes on to state that "A further estimate is made of the indirect employment", and then they "multiply the value of the.. . contract by a job factor".
I suggest to the House that with all of those variables we come out with a complete guess. The witnesses at the committee were unable, anywhere along the line, to say they could put a hard line in respect of the 200,000 jobs claimed. When the minister, who used to be a reasonable man, in my view, was questioned about this, and he had not been there when it was first presented, and when 1 pointed out to him all the problems there were with this method of calculation, he said that no further information would be coming forward and that we, as the opposition, were free to draw our own conclusions from the information tabled. The conclusion we draw on this side is that there will be nothing like 200,000 jobs created by the gymnastics going on over there in the building of this monstrosity of a government-owned corporation.
I know we are going to have other motions and other debates. There are other factors which properly belong to other portions of the debate, so at this time I will let the debate on Motions Nos. 1 and 3 be continued by other members of the House.


Donald W. Munro: Mr. Speaker,
I listened with a great deal of attention and concern to the figures produced by the speaker who proceeded me, the hon. member for Vancouver Quadra (Mr. Clarke). He outlined the degree to which the Export Development Corporation has been expanding over the years from 1971; in the last seven or eight years. I was not making notes of the actual figures, so I would not dare quote them. I recall one being the increase from 1971 to 1978 as 1,600 per cent. Whether that had reference to
June 26, 1978

insurance coverage or capitalization, I do not know. I will leave that for the moment. Elowever, it is symptomatic of the degree to which this corporation has decided to balloon its hold over industry.
It has been said, for example, that a very high percentage of Canada's exports of manufactured products is financed by the EDC. 1 suppose this is true in respect of other countries as well, but I wonder why there is not some attention being paid by the EDC, or some comparable agency in Canada, to increasing the manufacturing capacity of our industries in respect of our internal needs.
My comments during the short time available to me will be directed toward one particular sector of interest to me. This is a sector in which I have been interested for a long time. When I first came to this House my maiden speech was about maritime problems in this country and the lack of a merchant marine. It might be of interest to put on the record the extent to which this Crown corporation has been financing merchant marines of other countries around the world, even those merchant marines which carry our goods to markets around the world.
We might ask ourselves where is our merchant marine? The answer is, of course, that we have no deep sea merchant marine. We do have an inland merchant marine, but our deep sea merchant marine has been allowed to wither and die under the direction of this government, and there is no sign whatsoever that I can see of it being revived.
Let me place on the record the degree to which ships have been built in Canadian shipyards over the last seven or eight years for foreign merchant marines. These ships have been built in Canadian shipyards and man-years of employment have been provided, particularly in riveting plates and in the producing of some steel, but not in respect of design, and I will have something to say about that later if time permits.
I looked through the reports in respect of the shipbuilding industry and could find no trace of any assistance by EDC in the building of foreign ships in the years 1969 and 1970. However, 1971 was a cracker-jack year. There were twelve vessels built for France. They were 15,600 ton container ships, financed by the Export Development Corporation. They were built in two shipyards on the St. Lawrence, and the extent of the financial assistance was $83 million. In addition, there were three 80,000-ton tankers built for Greece, financed by the EDC to the extent of $43.5 million gross. At the same time there were two dry cargo vessels of 20,000 tons each, partially financed for the United Kingdom.
When all these vessels were completed-twelve for France, three for Greece, and two for the United Kingdom-they were rolled off the stocks and registered in the country which had ordered them. Presumably they are now plying the North Atlantic carrying Canadian goods to France, Greece, the U.K. and other parts of the world. This covers only 1971.
In 1972 there was nothing. Perhaps some of those vessels were being built at that time. In 1973 the enterprise was
Export Development Act
resumed and there were six vessels constructed for Panama; 16,500-ton deadweight dry cargo vessels financed or insured-
I am not sure which-under the EDC to the tune of $65 million. Once again there were two more for the United Kingdom. These were 39,000-ton tankers financed to the extent of $30.4 million.
The year 1974 was another good year for what is known as the man-year operation. There was one vessel financed which was destined for the Bahamas. Bahamian registry is also a registry of convenience. It was a 37,500-ton-I suspect it was a tanker, but I did not note it-vessel financed to the extent of $14.4 million. There were also two Liberian tankers weighing
39,000	tons and financed in the amount of $16 million. Once again we are in the flags of convenience. The United Kingdom received two 39,000-ton tankers financed up to $16 million as well.
In 1975 two 17,000-ton general purpose vessels were built for Algeria and financed in the amount of $30.1 million. There were six more vessels built for Bermuda. You will note again, Mr. Speaker, a flag of convenience country. These were 31,250-ton vessels financed to the tune of $110.9 million, and there were 10 more vessels for Panama which were classified as 17,000-ton multi-purpose vessels financed to the extent of $154.9 million.
In 1976 I suppose those 18 or 20 vessels which were in two yards on the St. Lawrence seaway were working their way through the system. By 1977 there were three more vessels, this time designated for Cuba. They were 10,160-ton deadweight tankers financed to the tune of $3 million. The next situation, Mr. Speaker, is interesting. In 1977 there was one or several-I cannot quite make it out from the way it is described in the report-vessels for Senegal described as fisheries surveillance vessels financed in the amount of $4.7 million. To my knowledge, aside from the icebreakers that are under construction in Vancouver, there have been no fisheries surveillance vessels produced within the last four or five years.
What does this all add up to? How much Canadian funding has gone into the financing of ships for foreign merchant marines? If you add all those items up, there were 51 vessels produced with total financing by the EDC amounting to $592.3 million-half a billion dollars. There ought to have been some means, and I would have thought that some of our members in shipbuilding areas would have been interested in this, of getting ships of this sort built for a Canadian merchant marine to carry our goods across the oceans. We hear of all the vessels sitting in Vancouver harbour waiting to be loaded with wheat. It is not because they are waiting, but why are those vessels not Canadian owned?
What does that figure of $592.3 million in financing operations, producing 51 ships for foreign countries, mean in terms of an increase in the shipbuilding industry in Canada? It is a tragic record. In 1975 the employment in those shipyards, including the building of all those vessels I have mentioned, was something in the order of 12,800 employees. In May, 1977, it was approximately 11,800 employees. There has been a drop of 1,000 employees in the shipbuilding industry, in spite

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of the fact Canada built 51 ships and financed them to the point of half a billion dollars.
I realize that I am referring only to the shipbuilding industry, but where does 200,000 jobs come out of that? It is a mathematical conundrum which I cannot solve. I am not saying that all those jobs were in the shipbuilding industry, but surely, having committed $500 million to building ships for foreign merchant marines, you would think that at least the employment level would be maintained. Surely there would have been something left over in Canada in the way of permanent employment. No, the figures we are given-and I have reason to believe that they are drawn from the statistics produced by the Department of Industry, Trade and Commerce to which EDC reports-demonstrate that as a result of this expenditure there was a drop of 1,000 jobs in the shipbuilding industry in Canada. How can we justify that sort of operation?
I would like to refine this a little bit more, but in doing so I am afraid I will have to introduce some confusion into the picture, confusion which I am not able to explain. I hope that one day the minister will be able to explain it. I would like to refer to the record so far as it relates to the contracts signed with France in the shipbuilding industry. This is drawn from the reports for 1971 to 1977, which contain a list of the contracts signed each year and the disbursements made each year. I find it totally confusing, but I think it is worth putting on the record. These are contracts for the building of vessels for France. It will be possible to correlate the dates with the figures which I gave earlier.
In 1971 contracts were signed with France for $88.71 million, and in that year, since the contracts were just beginning to work themselves out, only $1.53 million was disbursed. The next year contracts were signed for $55.61 million, and in that year only $2.28 million was disbursed. In 1973 contracts were signed for $40.74 million, and $11.67 million was disbursed. In 1974 contracts were signed for $60,896 million, and $34,510 was disbursed. What I cannot understand is that there seems to be some difference from year to year in the contracts in effect between France and Canada for the construction of these vessels. Now I come to the year 1975 when figures for the contracts signed and disbursements happen to coincide. In 1975 contracts were signed for $60,248 million, and the disbursements were $60,248. That works out, and the same occurred in 1976 when the contracts signed were for $60,230 million and the disbursements were also $60,230 million.
I think I mentioned in my earlier figures the number of vessels that were built for France in this program. I am glad that the people in the shipyards had these jobs, and I am not complaining about that. My argument is that these vessels should have been built for the Canadian merchant marine, and that the assistance which was granted to overseas purchasers should have been and should be available to Canadian enterprises if they are inclined to use it. The same number of ships, 51 ships, could quite as easily be flying the Canadian flag

around the world, carrying Canadian goods from Canada and bringing imports back into the country. What does this mean in terms of our Canadian merchant shipping? I think the answer is obvious.
The following question also arises in my mind: what does it mean in terms of the Canadian maritime design capacity, or naval design capacity? What we have been doing-and I think this is the message we should extract from the figures that I have put on the record and the EDC's performance-is using Canadian welding techniques in Canadian shipyards, but we are contributing nothing to the technology that should be there and that was there, and that is part of Canada's tradition in shipbuilding. We are contributing nothing, and the EDC is contributing nothing to that distressing situation.
The Canadian naval maritime shipbuilding industry had been known for centuries until after the Second World War when it began to decline, and we are suffering as a consequence. Our shipbuilding and design capacities have withered and are in the process of disappearing as a result of the policies of this government to encourage the welding and putting together of a vessel according to someone else's design. What I fear is that this will be the history of our naval program: that we will go offshore to buy a design, to have it made up in a Canadian shipyard because it would be cheaper. Perhaps it would be cheaper in simple dollar terms in getting that hull on the waters and floating it, but would it be cheaper-and I insist that it would not-in terms of the development of the technology we should retain in this country?
I see, Mr. Speaker, that you are stirring uneasily in your seat. Perhaps I could come back to this later to develop this very important notion of the loss to Canada of the technology of marine design for civil and naval purposes.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Ethier):: Order, please. It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be debated at the time of adjournment are as follows: the hon. member for Faval (Mr. Roy)-Canadian Broadcasting Corporation-Celebration of Canada Week; the hon. member for Capilano (Mr. Huntington)-Finance- Dumping duty on wide-flange steel beams; the hon. member for Surrey-White Rock (Mr. Friesen)-Finance-Dumping duty on wide-flange steel beams.
June 26, 1978



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of Bill C-36, to amend the Export Development Act, as reported (without amendment) from the Standing Committee on Finance, Trade and Economic Affairs.
Mr. J. Robert Howie (York-Sunbury):: Mr. Speaker, thank you for permitting me to take part briefly in this debate. This bill authorizes the Export Development Corporation to raise $26 billion.
Since its inception in 1969 the EDC has had its authorized capital for corporate lending increased from $600 million to $10 billion. In corporation insurance, its authorization has increased from $250 million to $10 billion.
I am going to suggest to the House that, by effecting greater selectivity in the projects being supported, the corporation can have a greater impact on national and regional development. An industrial development strategy for Canada with ancillary strategies for regional growth can make the EDC a more valuable and viable instrument for economic growth. At the present time, like a man jumping on a horse and driving off in all directions, the corporation has funded industries for shortterm gain, with disastrous long-range implications.
The EDC is lending $47 million to a newsprint mill in Virginia to buy Canadian-made equipment and engineering services. A coated paper mill in Kimberley, Wisconsin, is arranging a similar deal. Canadian tax dollars are funding future competitors of our pulp and paper industries. Aurele Ferlatte, Atlantic regional vice-president of the Canadian Paperworkers Union, was recently quoted in the New Brunswick press as indicating this policy could lead to the eventual unemployment of several hundred workers in the maritime region. In addition, the advanced technology used in a new mill gives it a further competitive edge.
Canada currently exports 65 per cent of its newsprint to the United States. The capacity of the new mill in Virginia will be
175,000	tons of newsprint annually, about the same as produced by the Rothesay-MacMillan mill in New Brunswick.
The EDC has lent something like $350 million to finance competing pulp and paper mills in Poland, Peru, Romania, Argentina and Iran. These mills were built with money in some cases borrowed from Canadian taxpayers, including owners and workers in the Canadian pulp and paper industry, who are, in many cases, struggling very hard to keep their doors open.
The EDC has also financed projects in a number of countries with state-planned economies such as Russia, Poland, Yugoslavia, Czechoslovakia, Hungary, Romania, Bulgaria, and Cuba. In these countries, because of the nature of their national economies, our competitors can enjoy an unfair advantage, aided by Canadian dollars.
Export Development Act
EDC has financed a mini steel mill in New Jersey, and other steel operations in Texas, Minnesota, and Great Britain, with Canadian tax dollars.
In 1975 the EDC provided $30.6 million to Ireland for an aluminum development, $3 million to Peru for a copper development, $55 million to Poland for forest products development, $2 million to the United States for a steel mill, and $8 million for a lead-zinc development in Turkey. These are all sectors of development providing unhealthy competition for Canada.
I do not have to underscore the drastic erosion of our manufacturing industry in Canada and the fact that the last thing it needs is competition from beyond our borders with tax dollars supplied in part by these very same Canadian industries. We have to consider the need to enable Canadian manufacturing industries to use the Export Development Bank as a vehicle to reach foreign markets without, at the same time, financing our competitors abroad and defeating our ultimate purpose of creating good jobs for Canadians at home.
Clearly, we have to be more selective in determining the areas of natural advantage we wish to exploit so that, in the long run, our policies are not self-defeating. An industrial development strategy is urgently needed in Canada if we are to pursue our areas of natural advantage, build on our successes, and develop all regions of our country. I question whether the EDC can continue to take a shotgun approach and fund export development in every industry that comes along and in every segment of our economy. I believe that in a country with our population, wealth, and resources, we have to be more selective.
My suggestion is that we should consider as one element in an industrial development strategy making Canada self-sufficient in food and energy.
I believe, too, that by fixing the ceilings asked for in this bill at lower levels we could save an expenditure of between $8 billion and $10 billion and, if we invest a fraction of this amount in the Atlantic provinces in badly needed infrastructures, including the greater infrastructures that cry out to be done, we could enable that area of Canada to move forward on its own initiative without the handouts and subsidies that have, unfortunately, become a trademark of repeated governments of Canada. Where millions of dollars have been spent, billions are needed, not in handouts, but as an investment in an area that can pay great dividends.
The development of the ports of Halifax and Saint John, the shipbuilding industries, the Chignecto Canal, and the Fundy tidal development, together with modern highways, rail and bus lines, air service and all-weather roads, can allow this neglected region of Canada to develop a regional industrial strategy in concert with a national development strategy, and move forward on its own.
If, for example, this government used a portion of this money to build the Fundy tidal project for the maritimes, the resultant energy cost-where the fuel is free-would be the

June 26, 1978
Export Development Act
lowest in the nation, and its use in the more expensive energy mix would be a beneficial reduction in electric energy costs. At present Nova Scotia and Prince Edward Island lead the nation in high energy costs.
The Department of Industry, Trade and Commerce is about to embark on a $1.7 million advertising program to encourage Canadians to buy Canadian. Does it make sense at the same time to spend billions of dollars building foreign plants for competitors? And right under our noses we have in our own department of Supply and Services 44 per cent of $1.9 billion spent for science and engineering going to the United States and only 2 per cent of the budget spent in the four Atlantic provinces. Clearly, our government must understand it is Canadian industries that it is supposed to help.
With the riches of the three oceans washing our shores, largely unexplored and unexploited, and the tremendous potential of fish farming and fish ranching, to say nothing of the oil that remains unexplored along our continental shelves, our own national oil company, Petro-Canada, is making token efforts in the Atlantic Ocean and is busily engaged in the exploration of oil in Pakistan, financed, of course, by Canadian dollars. The Petro-Canada and CIDA operation involves some $70 million. No wonder the EDC thinks it is proper to finance foreign competitors!
Recently in California the people gave a message to their government which was, in effect, that they are fed up with the inefficiency of government and its involvement in areas that are best left to those who wish to take the risks and receive the profits in the private sector. We must cut the cost of government, and do it now.
On two occasions I have proposed the use of a commission to blueprint areas in which the government should not be involved, and to promote greater efficiency in our administration.
The Auditor General repeatedly fingers operations where corrections are required. My suggestion to parliament today is that at this moment we have an excellent opportunity to move in that very direction. I suggest, Mr. Speaker, that the corporation has not justified the expansion represented by this bill.
The EDC can become an excellent vehicle for development of our foreign trade, but I believe it lacks direction and proper guidelines, and that it is trying to do too much for too many, and consuming an inappropriate percentage of our gross national product. The sum of $26 billion is equivalent to 10 per cent of the current domestic gross national product. The EDC can be made to work for Canada and Canadians, as well as for foreign interests. We know what the priorities should be. Let us get them in perspective.


Sinclair McKnight Stevens: Mr. Speaker, I have a few remarks to make on this motion before we dispose of it.
I suppose there is no piece of legislation before this House, indeed before this parliament, which will be more regretted by future parliaments and certainly by the people of Canada than the passage of the Export Development Corporation legislation

that is now before us, if the irresponsible lending activity that this government has engaged in is allowed to continue.
The concept of supporting export as far as our exporters are concerned was conceived with good intentions. It is a good idea to support those who are trading on behalf of Canada. It is certainly a good idea to support our exporters if they in turn are having to meet competition from other countries whose governments give financing support to those exporters. Unfortunately, Mr. Speaker, we find in the case of EDC that a government starting without any industrial strategy whatsoever has allowed itself to become more and more dependent on a system whereby our manufacturers increasingly find that they have to sell financing instead of the goods themselves which we hope to export. That is the tragedy before us.
To hear the president of EDC, when he appeared before a committee, tell us in a rather boastful way that 40 per cent of the capital goods exported offshore as they call it-that is other than to the United States-is now financed by EDC, this is a sad testimony with respect to the state of our manufacturing industry and its competitiveness as far as world markets are concerned.
In considering the two motions of my hon. colleague I would ask hon. members to simply ask themselves this: Are they prepared either to acquiesce or possibly even vote with the government later today or tomorrow? Are they prepared to accept the consequences of the eventual write-offs that will occur with respect to the billions of dollars that this government, through EDC, is determined to make in support of the exporters who in turn are demanding this type of financing because they are no longer competitive in world markets? These are simple questions.
When we ask that these authorizations be lowered we are simply saying, "Bring in some sanity and, bring in some perspective" so that the Export Development Corporation, instead of loaning money virtually with no security and no limit in mind, will be brought down to the reality of saying, "We have to operate within a limit." The limit we are suggesting is $16 billion. Surely a $16 billion limit is not unreasonable when it is borne in mind that the total lending activity of the EDC at the present time is approximately one quarter of that amount.
What we are saying, and I emphasize this with every ounce of conviction that I can, is that we in this House are going to become party to, either today or tomorrow, should this bill ever pass, a system where almost unlimited, uncontrolled financing is going to be poured through the Export Development Corporation to foreign governments, many of which will never pay that money back to Canada in future years.
Put any figure on it you like. We are now talking in terms of $10 billion or $15 billion. I would guarantee that within five to ten years, certainly within 15 years, 25 per cent of that money will never be repaid to the Canadian public.
The most shocking thing about this is the utter deceit and misrepresentation this government is guilty of, concerning this
June 26, 1978

financing. Incidentally, there is one minister in the chamber at the present time. That shows the concern they have for the Canadian public. Here we have $26 billion of authorization being requested to go to a Crown corporation, and the minister in charge, the Minister of Industry, Trade and Commerce (Mr. Horner), has not even appeared in the House today, let alone spoken on the bill. None of his acting ministers are in the House. How shocking!


Mr. Young:: Play to the galleries.


Sinclair McKnight Stevens: Let me make this clear. When I refer to this authorization and the fact that probably within a 15-year period we or some other government will learn that 25 per cent of the amounts involved as far as the lending activity is concerned will have to be written off, the most deceitful thing this government has done with regard to the Export Development Corporation is the pretext that the money is not an obligation of Canada.
Just look at what they have done. It used to be, in budgets that were submitted to this House, that it was very clearly set out that included under financial requirements was any financing required by Crown corporations. For example, if Petro-Canada needed money, that was included as a financial requirement of the Government of Canada. If the Export Development Corporation needed money, that was included as well. However, we now find that any reference to that type of financing has been conveniently shuffled off in our budgetary papers, to a note to the budgetary papers.
In that connection let me refer hon. members to the last budget of the Minister of Finance (Mr. Chretien) delivered in this House on April 10, 1978. Various financial requirements for Canada are set out. It is pointed out that the total national accounts expenditures are $49,775 million. They point out, for example, that the financial requirements, depending on whether you take a budgetary basis or a national accounts basis, are as high as $1 W2 billion.
Here is where the deceit comes in. It is not until you turn to page 27 of the notes of the Minister of Finance that you find he deals with the question of direct borrowing by Crown or government agencies. Here is what he says:
In the projection of financial requirements for 1978-79, it is envisaged that such direct borrowings by agent corporations will continue, and that in particular the Export Development Corporation will raise the bulk of its requirements through direct borrowing.
In short, Crown corporations last year are recorded in this note as borrowing, in the case of Petro-Canada, Export Development Corporation, and Eldorado Nuclear, $350 million, and $463 million the year before. They now say that those requirements are not now being reflected in the general financial requirements of the government. I call that deceitful. It is misrepresenting the facts.
They have taken a base year which included such Petro-Canada and Export Development Corporation borrowings, included that as their inflated base year figure, and compared current expenditure and financial requirement figures against that base without making it clear on the face of their state-
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ment that the Petro-Canada and Export Development Corporation type of borrowing is not now being included in the gross figures. That is a serious misrepresentation of the facts. Unfortunately, future generations of Canada will have to pay the penalty that this government is now putting on their backs.
It has become very popular for some of the Grit supporters, who I notice are not speaking today, to say, why would you ask us to include the borrowings of Crown agencies when in fact they are borrowing the money on their own account? The inference is that somehow the covenant of Canada, the people of Canada, does not go with that borrowing. However, as so often happens in the secrecy that shrouds this government, it is on the American side that we learn the facts. It is not within this House, and certainly not general as far as Canadian information is concerned.
A very elaborate presentation was made to the Standing Committee on Finance, Trade and Economic Affairs. Various schedules are set out in that, including a schedule which is simply a reproduction of the Export Development Corporation's type of prospectus which was filed in Washington concerning the Export Development Corporation raising funds in the United States.
I find this interesting. The one I have before me is dated June, 1977. The two parties involved are Salomon Brothers and Wood Gundy Incorporated. The amount being raised by the Export Development Corporation in the United States is $50 million U.S., due August 1982. On page 12 of this circular we find the following very interesting comment. Under "Description of the notes", it states:
The notes will be direct, unsecured general obligations of EDC and as such will constitute obligations of Her Majesty in Right of Canada. Payment of principal of and interest on the notes will be a charge on and payable out of the Consolidated Revenue Fund of Canada. The issuance of the notes is subject to the approval of the Minister of Finance of Canada and the notes will be created pursuant to resolutions of EDC's board of directors.
That is what this government is telling the Americans who are loaning Export Development Corporation the funds. They are boldly stating that any money loaned to Export Development Corporation, to use their words:
-will constitute obligations of Her Majesty in Right of Canada. Payment of principal of and interest on the notes will be a charge on and payable out of the Consolidated Revenue Fund of Canada.
Imagine the utter deceit of this government, knowing that is the legal statement they are making in Washington when they file that clearance of these notes, turning around and in their budgetary presentation saying there is no need to refer to any borrowings as far as the Export Development Corporation is concerned because they are doing that in their own name. It is not true. The fact is, year in and year out, there will be added to the direct obligation of Canada billions of dollars in the name of the EDC, with no budgetary reference being made to them, until the day comes when massive write-offs will need to be made with respect to those borrowings. There is going to be a build-up year after year.
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On the one hand, the EDC is binding the people of Canada; on the other hand it is making loans under questionable convenants around the world. How fast does the minister see the volume of lending activity rising? It is estimated that by 1981 the corporation will have $12,300 million outstanding. The corporation will have more than $12 billion of exposure under some type of convenant around the world, and I am saying that of this amount about 25 per cent will be non-collectible between five and 15 years from now. We are playing a game for the sake of supporting an exporter for a year or two, lending money to other countries and hoping to be repaid in five to 15 years' time.
In our questioning of Mr. MacDonald we naturally asked whether there had been any write-offs already-had there been any cash drains as a result of loans coming a cropper. First of all, Mr. MacDonald said, "No, no, we are really clean; we have never experienced a default." But here again we come up against the utter deceit practised by the government in power, because different facts emerged from the American documentation. I invite hon. members to look at the circular to which I have referred. On page six, we find this interesting revelation. The Americans were told that since the inception of the program loan payments totalling $61.2 million had been rescheduled of which $15.9 million had been repaid by December 31, 1976. The statement continued:
Interest rates on rescheduled loans have been generally at the same or higher rates. On other loans, principal installments totalling $1.8 million were overdue at December 31, 1976. No loans have been written off since inception of the international lending program but one loan was cancelled at no loss to EDC under an arrangement with the Government of Canada to cancel a corresponding amount due from EDC.
I call particular attention to that last sentence. How clever this artful dodger of a Prime Minister (Mr. Trudeau) is. The truth is that when we pressed this point we found the corporation to be in unbelievable trouble with the Bangla Desh loan. What happened? Rather than accept the loss through EDC the government lent the money to Bangla Desh on the understanding Bangla Desh would repay the money to the corporation.
Mr. Speaker, every phoney finance company in the world has played the game EDC is trying to play when they get into trouble with loans. That is the cop-out. Reschedule the loan, charge a new interest rate, get the other party to sign, and forget about it. And if you really reach the point at which the debt must be written off, call somebody else in to give the cash to the defaulter, thus putting him in the clear. Mr. Speaker, that is no way in which a Crown corporation should be operating. It only emphasizes the precarious position in which we find ourselves when the Minister of Finance lacks the courage to reflect this enormous borrowing in its own budget, and when the Minister of Industry, Trade and Commerce does not even have the courage to come into the House and respond to criticism of his own bill requesting authorization for $26 billion.
Mr. Speaker, I want to tell you what is happening down in Peru with respect to some of these lending activities.


Mr. Deputy Speaker:: Order, please. The hon. member will need unanimous consent to do so, because his time has now expired.


An hon. Member:: No!


Mr. Deputy Speaker:: I am not clear whether there is unanimous consent or not.


Some hon. Members:: No!


Mr. Deputy Speaker:: It appears there is no consent.


Mr. Ray Hnatyshyn (Saskatoon-Biggar):: Mr. Speaker, I rise to take part in this debate-


Stanley Howard Knowles: I rise on a point of order, Mr. Speaker. I hope the hon. member for Saskatoon-Biggar (Mr. Hnatyshyn) will forgive me for raising a point of order before he begins, but in view of the importance of these two amendments I wonder whether there is to be some sort of response from the government side. We have not heard a word from the government side this afternoon. We have been listening only to Tories.


Mr. Deputy Speaker:: The hon. member is asking the Chair to answer a question with regard to which the Chair has no influence. I am just here to apply the rules of the House.


Ramon John Hnatyshyn: I do not object at all to the comments made by the hon. member for Winnipeg North Centre (Mr. Knowles). We are dealing with amendments which involve millions upon millions of dollars and I find it almost unbelievable that the minister who is principally involved, the minister who is piloting the measure through the House, should not be here to give some answers to the pointed questions which are being raised concerning the operations of the EDC.
The average citizen cannot comprehend the magnitude of the amounts involved. The average citizen can relate, for example, to the expenditure of $180 by the Prime Minister (Mr. Trudeau) for ash trays in his office. He can understand, for example, the expenditure of $8,000 for a sofa in the Prime Minister's office. But he cannot comprehend the size of the amounts we are talking about under this proposal to extend the financial limits under which the EDC is allowed to operate. With scarcely any information being given us on this subject it is no wonder parliament and the country's institutions in general are falling into disrepute.
It is difficult to understand why no one on the government side is willing to stand up and at least attempt to give some justification for what is being proposed. I want to give an example of the kind of secrecy which shrouds the operation of this corporation. There are considerations here about which, for the life of me, I cannot understand why we are not receiving more information. Is there something we should read into the failure on the part of government spokesmen to bring forward this information?
June 26, 1978

Just recently much attention has been given to the Bell Canada contract with Saudi Arabia. I suppose it is appropriate that we talk about Saudi Arabia. The Saudi Arabian oil minister is here visiting our Minister of Energy, Mines and Resources (Mr. Gillespie). They are in Alberta now. I do not know what the Saudi Arabian minister is here for. Perhaps he is going to buy the Alberta tar sands, for all we know. We get no information from this government. It is a closed shop. We have absolutely no information with respect to the operation of Bell's contract with Saudi Arabia. We have been denied access to the contract, even though it has been called for by an independent commission set up by this parliament for the people of Canada. The Human Rights Commission has asked for access to that contract, but that request was denied. An application to the CRTC was also denied.
This contract has been the subject of much public attention regarding boycott provisions and an apparent undertaking by Bell that it has no existing or outstanding contracts with the Israelis. The contract is also interesting because of other provisions which have come to light, not through any disclosure on the part of the Government of Canada or EDC which is, in effect, providing insurance, and not through any disclosure by the CRTC, which is a regulatory agency now considering an application by Bell for a substantial rate increase which will bring something in the vicinity of $171 million to the company in revenue this year, and another $398 million next year.
The information we get about this contract comes through the securities and exchange commission of the United States. What information do we get about this contract, which is being insured by the EDC? We find that Bell Canada, through this contract, is paying $88 million to Saudi Arabian business interests. Let us do some simple mathematics. I believe $88 million is about 8 per cent of the total contract. That is a round figure, but it amounts to about one half what Bell Canada is asking for in increased fees. It is a little less than one half the $171 million. We find this out, not through any of our own government agencies and not through disclosure requested by as important a body as the Human Rights Commission, but through the American Securities and Exchange Commission.
What is the next step? Mr. Ben Tierney of Southam News in Washington thought this was rather vague. We are paying $88 million to Saudi Arabian business interests. The president of Bell Canada was asked what this is all about. The response was a flat no, that there would be no information forthcoming as to the nature of the payments, nor to whom these payments will be made. The point here is that the EDC is involved, and the whole question of accountability is very much on the minds of parliamentarians who are participating in this debate, and of Canadians generally. We are not talking about an $8,000 sofa, as expensive as that may be, in the Prime Minister's office. We are talking about $88 million. Perhaps that does not impress hon. members opposite. Perhaps they would ask, "What's $88 million", to paraphrase a famous statement made
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by one of their predecessors. However, I find this to be endemic of the attitude which this government takes with respect to disclosure. It is also endemic of the attitude the government takes with respect to the operation of the EDC.
The chairman of the EDC was questioned in committee with respect to the Bell contract. He gave general responses with respect to the boycott provision, but what about this $88 million? Are we to assume that these are payments similar to the payments which have been made by AECL and which have come under some criticism by thoughtful people, and certainly by taxpayers who wonder what is happening to their money?
What kind of system are we living in when the EDC can take the attitude, as has been outlined by my colleagues, the hon. member for St. John's West (Mr. Crosbie), the hon. member for York-Simcoe (Mr. Stevens) and other speakers on this side of the House, that it has absolutely no responsibility for reporting its activities or for accounting for them to the representatives of the people of Canada? What kind of rationale is there on the part of a government which now asks us to increase vastly the amount the EDC should have available to it when we have clear indications, as the hon. member for York-Simcoe has pointed out, that until there is any default-and even then I do not know whether the EDC will be subject to being asked questions or giving answers-there is a lack of accountability? The government and its supporters seem to want to force this bill through.
The facts surrounding this contract between Bell Canada and the Saudi Arabian government are an example of the kind of attitude the EDC has brought into its affairs. It accounts only to itself. It feels it has no responsibility for accounting to parliament. Who is to say that there is any accounting to the minister? What controls are we going to have-or can we look forward to in the future-on the basis of what has apparently transpired in the past and the record of the EDC as far as legitimate requests for information are concerned?
We have been spending much time debating the question of freedom of information. The question here is whether we should have a meaningful freedom of information bill brought forward. One after another hon. members opposite rise in their places and talk about how much they believe in freedom of information. In open convention the Liberal party passes resolutions supporting the concept of freedom of information and of independent reviews of applications for information, yet every time we come forward with requests for information concerning the operations of Crown agencies and the government itself, the argument of the government seems consistently to be that our parliamentary system dictates that the government should make the decisions in these matters and that every few years-four conventionally, but with this government perhaps five and a half or longer, whenever the Prime Minister has the courage to call an election-the people of Canada will speak.
The argument is that the people of Canada will speak as to whether the government has been withholding information. Well, I hope and trust that in the next election the question of
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withholding information which the Canadian people ought to have will play a key part in electoral decisions, because no thinking Canadian can support the position this government has taken throughout its mandate.
As far as EDC involvement is concerned, a line of insurance worth $430 million is being provided in this particular transaction with Bell Canada. This transaction involves modernization and expansion of that company's telephone system. In view of the fact that this transaction is supported by the Export Development Corporation to that extent, I think the minister should be in the Elouse. Tie should rise in the House and tell us whether any of the $88 million payment, if made in Canada, would violate Canadian law. That is not an idle request.
I referred to the example of AECL making kickback payments. Whenever government agencies refuse to give information with respect to payments of enormous amounts of money, such as this $88 million, I do not think I am being overly suspicious or irresponsible in wondering what those payments are all about. Have we reached a point in government where the contract is the thing? Are we to accept the rationale of the Minister of Industry, Trade and Commerce (Mr. Horner), with regard to the question of the Arab boycott, that somehow it is more important for Canadians to have this contract than to stand up for the civil rights and liberties of a large number of Canadian citizens with Jewish backgrounds?
It boggles the mind that hon. members would vote in support of this particular proposition, when information respecting this enormous amount of money is not forthcoming. This is almost a matter of right. If there is nothing to hide, and if this is a legitimate expenditure of money, why is there reluctance to make disclosure of this information? If services are to be performed by Saudi Arabian business concerns, we should receive a reasonable accounting of the reasons. We would be prepared to facilitate the transaction and be supportive of EDC if we were given the information by which we could make a reasonable, proper judgment.
What we have received is silence, a very ominous silence. On the basis of the record of the government, it is almost an axiomatic rule that where there is silence, there is a political reason for the government wanting that information concealed. There is a reason for this government veering away from having an independent arbiter making a decision concerning applications for information. Once a decision is taken as to whether information should be made available to Canadians and parliamentarians, and once it is taken out of the control of government, an awful lot of information which may not be beneficial to the government will come out. I hope I am wrong.
I did not intend to participate in this debate. On listening to the remarks of the hon. member for York-Simcoe and considering this particular transaction as an example of the incredible insolence with which EDC, other government agencies and the government have dealt with this particular matter, it is time to stand up to the government. We must let the govern-
[Mr. Hnatyshyn.)
ment know that we will press as hard as possible for a proper accounting and for freedom of information in this country.
When we form the government after the next election, under the leadership of the hon. Leader of the Opposition (Mr. Clark), freedom of information legislation will be brought forward and passed. It will be effective legislation and not the second class proposal the government is putting forth now. The government wants an information commissioner with powers similar to those of the Auditor General. He will be able to make recommendations but his decisions will not be binding on the government.
Perhaps we can be critical of Americans in many respects. They are our next-door neighbours. We see a lot of them, and we know what is going on there. But there is a lot in the American system respecting disclosure which we should pay particular attention to and perhaps emulate in the interests of good government, regardless of which party forms the government. I say that in a non-partisan sense. I am not suggesting that we are saints on this side and that the devils are on the other side. But unless there is a meaningful freedom of information mechanism, there will be a temptation for whatever party makes up the government to conceal in order to perpetuate its own political administration. If a different tone was set, this country would have the benefit of a better government. This is something government members should pay more attention to.
The only way members of parliament can receive information concerning Canadian activities is by operating through the freedom of information legislation in the United States. We are faced with going through the securities and exchange commission of the United States in order to determine what is happening, for example, in respect of Bell Canada. Under their regulations and legislation, they require a prospectus to be filed. Presumably they pulled teeth in order to receive information concerning the $88 million.
I see my time is fast coming to a close. Perhaps I will pursue this matter on another occasion when this bill is discussed. 1 thank the House for its attention.


Some hon. Members:: Hear, hear!


Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker, I had no intention of becoming involved in this debate, but after listening to the remarks of the hon. member for York-Simcoe (Mr. Stevens) and the hon. member for Saskatoon-Biggar (Mr. Hnatyshyn), suddenly I realized how important this bill is. Earlier I heard it was of some significance because there is a move afoot which Canadians are not fully aware of in terms of the ultimate repercussions. Of course, this has been clearly articulated by my colleagues.
We are attempting to indicate that apparently the government thinks EDC is the panacea for the ills of the world, and that it should have some $26 billion at its disposal in order to finance, insure and guarantee loans to various countries throughout the world. Apparently the government does not understand that the Canadian private sector needs assistance as well. It is turning a deaf ear and a closed eye to the
June 26, 1978

problems of the pulp and paper industry and the steel industry, just to name two.
I am from the city of Hamilton where we have the greatest steel company in the world. How long will that steel company last when we have this government, through EDC, subsidizing steel mills in the United States and throughout the world? How long can it possibly last? I want to stand up and be counted among those against this sort of thing, because it is something that in the long run, for some alleged short-term gains, will put us in very difficult circumstances years down the road. In other words, we are attempting to bankrupt the future of our young people who are even now crying out for help.


An hon. Member:: Sold down the river.


Lincoln MacCauley Alexander: Someone says they are being sold down the river. Our young people are looking for more leadership than this government is prepared to give.
There is something else about this whole thing that bothers me. The EDC apparently dislikes members of parliament criticizing its actions. We are elected by our constituents throughout this nation to stand up and be counted and to bring about constructive criticism when we feel it is required. We then have members of a Crown corporation or an agency, whatever you want to call it, who are not accountable to parliament, getting very angry about such criticism. They even go so far as to prepare and send out a bulletin for the edification of the people of Canada. I do not know what this is supposed to be all about, but under the heading "EDC NEWS", dated January-February 1978, there is an article which is in reply to a highly respected member of parliament who, having seen the direction in which the EDC was going, wrote an article which was published in a number of newspapers. The first thing that happened was the EDC replied in this newsletter, or whatever it is, at page 2 in the following words:
In an article that recently appeared in a number of local newspapers, Conservative MP William C. Scott (Victoria-Haliburton) called for the abolition of EDC and charged that it was a "threat to the future of some of (Canada's) domestic industries".
The article then has a series of reasons why that hon. member was wrong. This corporation is trying to flim flam and bamboozle the Canadian public. That hon. member had every right to bring to the attention of the Canadian people what he thought was wrong because, unlike members of the government, he realizes that questions are being asked about what is going on. That hon. member was in fact stating that the EDC is providing a lot of money to finance our competition abroad. That is what the hon. member was suggesting. Members of the EDC did not like that criticism, so they got their brain trust together, their lawyers, accountants and speech writers, and prepared this article castigating the hon. member for Victoria-Haliburton (Mr. Scott).
The second question that should be asked is, should the Government of Canada use taxpayers' money to commit loans
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in respect of industries that will eventually hurt our own struggling companies? That was the second question asked by the hon. member. The EDC did not like that and went even further than preparing this article; it conducted a $20,000 advertising campaign in the Financial Post, again to flimflam and bamboozle the Canadian people about the amount of employment EDC was creating.
The hon. member for York-Simcoe, the hon. member for Saskatoon-Biggar and others who have taken part in committee hearings have tried to determine just how the EDC created the supposed 200,000 jobs. They have not met with success as yet. As the hon. member for York-Simcoe has indicated, this is all a farce and a fraud perpetrated against the Canadian people.
Just let me refer again to this document which is headed "The Method of Estimating the Number of Man-Years of Employment Maintained and Created, Directly and Indirectly as a Result of EDC Support". This is another document issued by those people who are trying to bamboozle not only the Canadian public but, in this case, members of parliament. They did not get away with that because of the efficiency, credibility and intelligence of our financial critic, the hon. member for York-Simcoe, who gets on top of issues like this, holding on as though with the tentacles of an octopus until his opponents cave in under the pressure. Apparently the EDC gave in under that pressure because it is now seeking the sympathy of the Canadian people through a campaign of advertising and articles of this kind in issues of their own news magazine.
Officials of the EDC apparently want carte blanche from the government in respect to all they are doing. On the other hand, the Canadian people are wondering why our pulp and paper industry is going down the drain while at the same time this government, through the EDC, is lending money for the development of the pulp and paper industry outside Canada. The Canadian people were never stupid, and as a result of television they are no longer uninformed. They now realize there is something wrong with the leadership we have been getting.
The people of Canada know that the Steel Company of Canada and the steel company in Saskatchewan will be supplying pipe for the Alaska pipeline. They know that this will be for the betterment of Canadian life. What they cannot understand is why we are lending money, some $70 million, in order to build steel mills in Texas, Minnesota and New Jersey. This is absolute nonsense. We are attempting to be competitive, and I suggest we can succeed, but why is this government through the EDC trying to undermine the Steel Company of Canada and related industries?
I cannot sit idly by knowing that these things are happening. I have to stand and be counted as one of those who wants to know what is going on.


Stanley Howard Knowles: But we have to give Ford money to get it to come to Canada.


Lincoln MacCauley Alexander: The hon. member says we have to give Ford money to get it to come to Canada. We do not understand the

June 26, 1978
Export Development Act
priorities on that side of the House. No wonder the Prime Minister (Mr. Trudeau) did not go to the people. I remember the Prime Minister going down to Toronto and holding Mr. Evans' hand. He is going to lose as well. In any event, the election machinery was in place and rolling. Apparently those in government felt they had bamboozled the Canadian public for just about ten years and this was another opportunity to do the same.


An hon. Member:: They were all oiled up.


Lincoln MacCauley Alexander: They were oiled up and the machinery was moving once again. The Messiah over there was going to bring about national unity. The Messiah was going to wrestle inflation to the ground again. The Messiah was going to create-


An hon. Member:: Come off it.


Lincoln MacCauley Alexander: We hear from the Minister of State (Environment) (Mr. Marchand). We do not hear from him often because he does not understand his job. That party over there was saying to the Canadian people that they can solve our problems. I know they always feel they have control in Quebec. That is what the Prime Minister thinks but I do not know whether he still has Quebec in hand after the sales tax argument we heard around here over the past several weeks. That government over there lowered the boom on that debate. It brought in closure and cut off criticism by the opposition. Hon. members opposite like to interrupt and feel that we should not be allowed to speak. I intend to continue to speak in the hope of saying something for the edification of the people, not for that group over there. They do not want me to talk. They do not want the opposition to talk. They cannot stand criticism. I intend to continue to talk and I will ask for extra time if necessary.


An hon. Member:: Tell us more about the Messiah.


Lincoln MacCauley Alexander: The Messiah was saying that his party would bring about national unity. Has he forgotten that he has been in parliament as Prime Minister and the leader of this country for ten years? Because he has brought about national disunity. To make a long story short, he did not solve inflation. There has been no growth. Our growth will be lucky to hit the 3 per cent level in spite of the fact the Minister of Finance (Mr. Chretien) says it will be 5 per cent. We cannot believe him, however, because every statement which his officials give to him with respect to growth, employment and inflation has been wrong, wrong in such a way that no one can plan anything because no one knows what is going on.
What I am trying to say is that Canadians have lost confidence in this government. It is confidence which they thought they had until the polls came in vis-a-vis the province of Ontario; then they were shocked. They ran. They were all geared up and the machinery was well oiled until they saw that

Ontario does not love the Prime Minister any more. He has had the biscuit. This government cannot bamboozle the Canadian people any more.
The strange thing about it is that there are only two ministers here, the Minister of State (Environment), who does not know what this bill is about-


Mr. Marchand:: I know as much about it as you do.


Lincoln MacCauley Alexander: -and the Minister of Employment and Immigration (Mr. Cullen), who has a lot of problems. I do feel sorry for him because he has so many problems with respect to creating jobs. But I look at my old friend the Minister of Employment and Immigration and I say, "Doesn't he understand what this bill is all about?" Why doesn't he stand up and say "Well, I've looked at it, it looks good but I really don't know; we think that in the short run it is good, or in the short run it is bad." I say that in the short run it may be good but in the long run this bill is a monstrosity. The members on the other side should at least have the decency and courtesy to stand up and speak on it. They are just looking at me. I know I am handsome. I say to them, "Don't look at me; read your bill and understand what is going on."


Len Marchand: How are you voting on the bill?


Lincoln MacCauley Alexander: There is the Minister of State (Environment) again. We only have to follow our spokesman. The spokesman knows what he is going to do, as I always do when I have the carriage of a bill. We over here know what we are going to do, but what are the people opposite doing? What do they think of this bill that is trying to bamboozle the Canadian people out of $26 billion? Is the Minister of State (Environment), Mr. Speaker, going to stand up and talk instead of sitting in his chair? That is no way to debate; you have to be a man or woman and stand up in this House and let your thoughts come out. There has not been one member of the Liberal party who has had the decency or courage to stand up and say, "We will give the government position." Usually there is at least a parliamentary secretary who will stand up and give the government's point of view. That is the most I have heard the Minister of State (Environment) say in this House, and he is always speaking from his chair. One of these days, Mr. Speaker, we are going to hear-


Mr. Lumley:: Stonewalling.


Lincoln MacCauley Alexander: Stonewalling. There is the parliamentary secretary who bamboozled the provinces with respect to Bill C-56. Some of the provinces were blackmailed into going along with the bill, and before they knew it they were paying the people of Quebec $85 and forgetting the poor people. That is the attitude which the parliamentary secretary has, and yet they say that they are treating all provinces equally.
This bill is worthy of more comment, particularly from the Liberal side. The Canadian people are asking themselves why the government is paying more attention to offshore industry than to the plight of our own industry which in the long run will make this country more viable and bring about an econo-


*

June 26, 1978

my which we can hand to our children. The Canadian people are saying, for example, "Why are you not interested in the pulp and paper industry?" It is slowly going down the drain and needs the uplift of a financial commitment. Surely we have the human resources and the people ready, willing and able to work. How long are our industries going to be second class citizens in Canada as opposed to world industry? It is no wonder this government did not go to the people.
In closing, Mr. Speaker, I just want to say that our motion is merely stating-


An hon. Member:: Keep on going.


Lincoln MacCauley Alexander: An hon. member has said to keep on going;
I certainly will.
The hon. member for York-Simcoe spoke on the crisis in Peru. This is certainly a disaster, and the hon. member does not even know what is going on.


Steve Eugene Paproski: Lots of hanky-panky.


Lincoln MacCauley Alexander: I would like to quote from, I believe it is, the Toronto Star, but I will hold it up in case some members wish to have their research assistants follow it up. The heading of the article is "Canadian bankers nervous as Peru nears bankruptcy", and it says:
The Canadian Export Development Corporation, which in effect ensures Canadian investment and sales abroad, stands to lose a further $72 million if Peru goes belly-up.
It seems everybody knows about Peru except the Export Development Corporation and the Liberal government in Ottawa.


Steve Eugene Paproski: Jack Horner.


Lincoln MacCauley Alexander: I will not even mention his name.
Our motion states that rather than allotting $26 billion, which is up from $8 billion in terms of financing guarantees, the EDC should be happy with $16 billion. This government should be delighted that we at least let them know we understand there is a role for EDC, but not at the expense of the Canadian taxpayer. That is all we are talking about.
I want to thank you, Mr. Speaker, for giving me an opportunity to put forth those few unprepared comments, but they must have struck home because as yet I do not see a member on the other side trying to stand up and say, "Well, the hon. member for Hamilton West has a point. He has been mean, he has been tough, but he has been wrong and therefore I want to challenge him. I want to stand and challenge the hon. member for Hamilton West." I would like to see hon. members opposite let me know, because I do not know everything. I know a lot, but I do not know everything.
I thought that at least there would be one member who would stand up and show me where I went wrong, but as yet there has been nobody, in spite of the fact we have two ministers present, the Minister of State (Environment), who wants to sit on his fanny and throw smart-alecky remarks across the floor, and the Minister of Employment and Immi-
Export Development Act
gration. The minister of employment has nothing to say because he has other work, but I am ashamed of my longstanding friend, who knows what this bill is all about and that one of his roles is to create an environment whereby we have the necessary jobs to reduce that figure of one million and over in the hidden jobless. That is his role, sir, but the minister remains silent. The minister is a member of the class of '68, as I am, and he has had a very meteoric rise. I will not say that I am ashamed of him because I do not think that that would be honest; but I would ask him why he does not stand up and be counted.
Thank you, Mr. Speaker. I see you are just going to rise; I am going to sit.


Mr. Speaker:: The hon. member for Hamilton West (Mr. Alexander) is quite right, I was just attempting to rise. Earlier I had expressed some concern about motion No. 5 standing in the name of the hon. member for York-Simcoe (Mr. Stevens). A few minutes ago I attempted to indicate to members who are involved or intend to be involved with this discussion that I would return to the chair at this minute in order to try to inject some certainty into the situation. I wanted to interrupt the process of procedural arguments, since we have spent this afternoon on this question and given it some time prior to this afternoon's sitting.
I attempted to sound a warning to the House about the practice that we were following with respect to motion No. 5. I think the Chair must always be careful to distinguish between procedural matters and matters of policy or practice. They can come close together, and certainly this is one of those occasions.
I find that an examination of the precedents indicates that there is not just one but several examples of the kind of motion put forward by the hon. member for York-Simcoe which have become part of the legislation, such as the Air Canada Act, the CNR financing and guarantee act, both of them of recent memory, and quite a number of others which I have collected this afternoon. Therefore, I want to say that I would not be able to justify on procedural grounds intervention in the hon. member's motion. On the basis of precedents I think it would be a departure from the practice which we have followed recently for the Chair to intervene in the motion of the hon. member for York-Simcoe and for the House not to go ahead with debate and decision on it.
However, I think I should warn the House that we began with two rather excellent examples, with two strong cases. The first was the Auditor General's report, and the second was the statutory instruments committee. The House wanted to ensure that the Auditor General's report was automatically referred upon tabling to the Standing Committee on Public Accounts. That objective is so meritorious as to scarcely find any difference of opinion in any corner of the House. However, we should remember that we appropriately amended the Standing Orders to that effect.

June 26, 1978
Export Development Act
With respect to the statutory instruments committee we also amended the Standing Orders to give effect to the design that any statutory instrument, any regulation, be automatically referred, or, in other words, that the committee have authority to examine any statutory instrument or regulation. Otherwise, there would be no purpose for the committee to exist, if it had to wait for an order of reference. It is there as a safeguard against an abuse of power contained in statutory instruments or regulations, and therefore it should have authority to look into every regulation as it is passed.
Those two specific purposes resulted in corresponding amendments to our Standing Orders. Both of those had a clear and explicit purpose. Now we have moved to clauses which say that reports of Crown corporations, once tabled, will be referred automatically to a standing committee. Once again a very meritorious objective, but there is no concurrent amendment to the Standing Orders. That is one very important step away from the original example.
In the forthcoming report stage of the oil and gas measure to which I referred earlier, an amendment has been passed in committee which takes it one step further again. Because in this respect-and I think we will have to look at it very carefully-no report was to be filed, no order was to be made by any board, no statutory instrument and no regulations would be passed; in fact, nothing would take place except that five years hence the act, which is on the statute books, will be referred to a committee. The language of the act suggests that several committees may be involved because several committees may claim jurisdiction, and they are all required, by the language of the statute, to activate themselves, to work quickly and deliberately and to report to parliament.
It may be that procedurally I am stretching too far in trying to stop the practice, and perhaps it is clarity and draftsmanship that is concerned here; but I will not intervene in the motion of the hon. member for York-Simcoe, because examples of it have been repeated in the statute books several times previously and it is exactly in conformity with those provisions, as he said earlier today.
However, I am now worried that we have gone one step further in the oil and gas measure, because there is no intervening step, no initiative taken by any member of parliament, not that parliament will review the practice in the situation with respect to the bill, but that automatically, without any action on the part of any person, without the tabling of any order or regulation or the filing of any report, there is a reference to a standing committee, not to parliament. If that is not bad procedure, it is certainly a vague and dangerous practice.
I simply want to say to the House that the motion of the hon. member for York-Simcoe is procedurally acceptable. However, it seems to be used as a steppingstone to another practice in the oil and gas measure which is close to being too vague to be acceptable on procedural grounds; and if it is acceptable on procedural grounds, it is certainly a dangerous practice in terms of attempting to predict five years into the future, with lack of precision as to how it will be accomplished.

I warn members that when that measure comes forward we should look at it again, whether this week or whenever it comes before us. We should receive the arguments that have been prepared now to see whether it is not too great an extension of the principle which was established on stronger grounds than the ones we find now.


Sinclair McKnight Stevens: Mr. Speaker, I thank you for your ruling with respect to motion No. 5, but in line with your thinking, in which you have raised considerable doubt concerning a similar provision in the oil and gas legislation, I wonder if you have directed your thoughts to Bill C-60, the constitution bill, which seems to be the ultimate extension of what I think is giving you some trouble in that it is proposed in the bill to make various provisions somehow or other binding on future parliaments. I wonder if before that bill is debated some thought could be given as to whether or not it is procedurally out of order.


Mr. Speaker:: It being six o'clock, I do now leave the chair until eight o'clock this evening.
At 6:10 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
The Acting Speaker (Mr. Turner):: Order, please. Is the House ready for the question?


Some hon. Members:: Question.


The Acting Speaker (Mr. Turner):: I understand the vote on motion No. 1 will dispose of motion No. 3.


Sinclair McKnight Stevens: Mr. Speaker, I rise on a point of order. I believe there was some understanding that there would be a deferred vote on the various motions.


The Acting Speaker (Mr. Turner):: My understanding of the Standing Orders is that the Chair has the right to postpone the vote until both motions are disposed of.
Is it the pleasure of the House to adopt motion No. 3?


Some hon. Members:: Agreed.


Some hon. Members:: No.


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


Some hon. Members:: Yea.


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


Some hon. Members:: Nay.
June 26, 1978


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


The Acting Speaker (Mr. Turner):: The division is deferred pursuant to Standing Order.


John Carnell Crosbie: Motion No. 2.
That Bill C-36, An Act to amend the Export Development Act, be amended in Clause 3 by striking out line 3 at page 4 and substituting the following therefor: "shall not at any time exceed two billion".
Motion No. 4.
That Bill C-36, an act to amend the Export Development Act, be amended in Clause 5 by striking out line 12 at page 5 and substituting the following therefor: "shall not at any time exceed one billion".


The Acting Speaker (Mr. Turner):: In accordance with a ruling made earlier today by Mr. Speaker, a vote on motion No. 2 will dispose of motion No. 4.


John Carnell Crosbie: Mr. Speaker, the purpose of these two amendments is once again to try and hold within a reasonable limit the amount of authority that this House will delegate to the Export Development Corporation. The first amendment to clause 3 has to do with the ceiling for contingent liabilities of the Export Development Corporation. The government's amendment proposes to change it to $3,500 million and the present authority is $1 billion in contingent liabilities. Our amendment suggests that the amount should be $2 billion, for the same reasons that I outlined earlier today, because the ceiling the government is now suggesting would keep the Export Development Corporation from the scrutiny of parliament and the House of Commons for too long a period of time, namely three and a half to five years. We do not think their record justifies that kind of authority being given to them.
The other motion we will consider at the same time is an amendment to clause 5, line 12 at page 5. This has to do with the government account. As hon. members know, there is a government account and a corporate account for the Export Development Corporation. In the corporate account, they exercise their own authority. In the government account, the government may direct them to do certain things. The government stands directly behind the liability if matters are unsuccessful.
Certain loans are entirely at the government's risk. As the hon. member for York-Simcoe (Mr. Stevens) and I explained earlier today, all of these loans are at the government's risk. The corporation itself has admitted it is an agent of the Crown. It has a legal opinion saying the Crown must stand behind all its debts and obligations. The legislation before the House wants to fix the ceiling for the government account at $2,500 million, whereas at the present time it is $850 million. We suggest that that be reduced to $1 billion, which should be ample. It may require the corporation to come back to us for more authority in a couple of years.
Export Development Act
One of the peculiar things about the Export Development Corporation is that the Parliamentary Secretary to Minister of Industry, Trade and Commerce (Mr. Loiselle) said in committee there is going to be new legislation regarding the EDC brought in this fall. It is going to change around its operation in some way or another. Why do these huge increases then have to be secured for the EDC in light of that? That is a bit of a puzzle.
It is also a bit of a puzzle as to why the Minister of Industry, Trade and Commerce (Mr. Horner) wanted to ram this bill through the House so quickly last March or April. He tried to get our finance critic to agree to rush through this legislation on an emergency basis with practically no debate because it was of such great importance. Naturally, our finance critic, being the man of character and probity that he is, would not agree to that.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: He said he would have to give it our normal penetrating scrutiny, which we have done. We have given it that X-ray vision. The $6 million men on this side have given it intensive scrutiny and have found it wanting. Unfortunately that is what we have found.
When I was speaking earlier this afternoon, members opposite would not let me go on past my 40-minute allotment. I could have finished all my remarks this afternoon. I would then have gotten up this evening and said that I have already covered the ground. Now they have so irritated me that I feel I must go another 40 minutes.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: If they behave themselves while I am speaking, I may be able to shorten it a bit. Any interruptions will make me very, very irascible.
This afternoon I was discussing the Bankers Association and how the Minister of Industry, Trade and Commerce did not want us to see a communication that had been sent to the Minister of Finance (Mr. Chretien) and myself by the Bankers Association. We were informed, of course, that there was no reason why we could not see it.
The Minister of Industry, Trade and Commerce said he did not go along with the banks. He did not think the banks really knew what they were doing. He let one or two asides like that slip through. Of course, the Minister of Industry, Trade and Commerce is an expert on banks. He said he did not altogether agree with what the banks were doing and just because they had certain views on this legislation was no reason why we had to pay any attention to them. To make sure we would not pay any attention to them, he would not make public this submission from the Canadian Bankers Association.
We can only assume that their views were not the most favourable. They obviously were not favourable to the government's ears. I leave it there because we do not know what their views were. However, if they were anything like our views, they are unprintable.
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June 26, 1978
Export Development Act
I want to touch on another inconsistent matter in the government's policy. We were told by Mr. MacDonald, the president, in our committee hearings that the EDC will positively not have anything to do with Rhodesia. Rhodesia is not on the list. It does not matter what commercial sense it makes to finance a transaction with Rhodesia, Rhodesia is just not with us. I think it is still called Rhodesia and not Zimbabwe.
The corporation says the government has no power or authority regarding to whom they lend. However, if the government issues an official communication and passes an order in council that it has no relationship with Rhodesia, EDC will not finance a transaction with Rhodesia.
This was indeed welcome news, that if the government had passed an order in council or had a policy of not having anything to do with Rhodesia, EDC would not have anything to do with Rhodesia. One gained the impression from Mr. MacDonald that if the government passed an order in council that would be all that they needed to have something to do with them. However, he said it was their policy not to finance transactions with countries no longer ad idem with the Canadian public.
He was then asked about Cuba, whether EDC was still prepared to finance transactions with Cuba. We know that Cuba has a particularly soft spot in the heart of the Prime Minister (Mr. Trudeau). He is heart to heart with Fidel Castro. He has been beard to beard with him in the past.


Some hon. Members:: Oh, oh!


John Carnell Crosbie: In fact, they liked each other so much at one time that, as our former Prime Minister, the right hon. member for Prince Albert (Mr. Diefenbaker), said, he tried to canoe to Cuba from Florida, unsuccessfully. That would have been one of the great meetings of 1960 if we had been privileged to see that.
In any event, the Prime Minister has a very soft spot in his heart for him. We asked about Cuba because the Prime Minister has gotten a bit irascible about Cuba lately with all the bother in Africa, there being tens of thousands of Cubans in Africa. They are buzzing around like an African bee, stirring up trouble, stinging the economy and going into Mozambique, or whatever it is called these days. As you can see, Mr. Speaker, I am not the international affairs critic. It is hard to keep up with these names.
In any event, the Cubans are becoming a bit of a nuisance in Africa. The Prime Minister said in this House that we are not going to give Cuba anything else. He said they are not going to be on our gift list any longer. Therefore, we asked the president whether this would have any effect on EDC, whether EDC was still going to finance transactions with Cuba. We know that the minister of amateur sport and fitness, or amateur fitness and sport, or amateur fit sport or whatever it is, went to Cuba over Christmas.


Steve Eugene Paproski: The minister in charge of gambling.


John Carnell Crosbie: The minister in charge of lottery and gambling went to Cuba over Christmas. Apparently we are still allowed to go there as tourists even though one minister is saying we should spend all our touring time in Canada. However, I do not want to get nasty and point at any inconsistencies about government action.


Some hon. Members:: Oh, oh!


John Carnell Crosbie: Hon. members opposite are very touchy. There must be an election coming in the next 12 months some time and they are getting very nervous. As I was saying, we asked whether EDC would still finance a transaction with Cuba. Lo and behold, Rhodesia is out and Cuba is in. If a commercial transaction comes along with Cuba, Cuba will be looked after. Therefore, Cuba is in and Rhodesia is out. They are on different continents; I suppose that accounts for the difference.
The hon. member for Edmonton West (Mr. Lambert) asked about Taiwan. Lo and behold, Taiwan is out and Cuba is in. The poor Taiwanese cannot get a bone or a sou. They cannot get a low interest loan from the EDC. It does not matter how good a piece of business it is for Canada, they cannot do any business with Taiwan. Nor can they do any business with Rhodesia. However, they can do it with Cuba, the U.S.S.R., Czechoslovakia, Poland and every other communist country in the world. They can do it with the high countries, the low countries, the mighty countries, but they cannot do it with Taiwan and Rhodesia.
The policy of this government is supposed to be all business. The Minister of Industry, Trade and Commerce is all business. He does not want to have anything to do with outlawing and making illegal boycotts in the Arab-Israeli situation. He does not want to spoil Canadian trade and commerce with the Middle East and Arab countries. Therefore, he does not want to make the Arab-Israeli boycott illegal. He wants to allow Canadians to boycott Israel if they do not have to come to the government for assistance to do it. He will not assist them in doing it, but if they want to do it on their own, it is perfectly all right. However, it apparently is not all right for the EDC to do business with Rhodesia and Taiwan.
We can't make cheese of one and chalk of the other. Has the country got a policy or hasn't it? Does it do business with the devil or anyone else who wants to do business with it, or does it not? In the committee, the minister said that we would do business with the devil if it was in the interests of Canada to do business with the devil. But apparently the Rhodesian devils and the Taiwanese devils are not in the same class as the Cuban devils. So we have discrimination now among devils and I intend to ask the Human Rights Commissioner, Mr. Gordon Fairweather, to examine this policy; it doesn't make much sense to me.
Either a country is going to base its foreign policy on human rights or some kind of moral consideration which we are told by the practised diplomats is not the right thing to do-it is apparently tricky and dangerous to make moral judgments on
June 26, 1978

what happens in the rest of the world-or it is not. If we are going to make the moral judgment that Rhodesia is out and that Taiwan is out, then in my opinion we should make other moral judgments. There are a lot of other countries in the world just as bad in their domestic policy, in my view, as Rhodesia and Taiwan. In most of the world there are dictatorships of one sort or the other so it cannot be that we are knocking out Rhodesia and Taiwan because they have dictatorships.
What is the reason? One reason, of course, is that we want to be friendly with Red China and Red China does not want us to have anything to do with Taiwan. That is quite understandable. There are other reasons in the case of Rhodesia. But I say it is an inconsistency that this corporation, which lends Canadian money at low interest rates and uses Canadian credit, is still permitted to do so in Cuba and everywhere else in the world except Taiwan and Rhodesia. It makes no sense and it is time the government thought out a policy which is consistent. Perhaps the Secretary of State for External Affairs (Mr. Jamieson) can put his well-honed mind to work on this matter and get things worked out, or at least talked out. If we could only hear him talk in those soporific tones of his on the matter, I am sure it would satisfy everybody in this House who wished to be satisfied by listening to him. We want a new policy in that direction.
What about rescheduling debt? My hon. friend from York-Simcoe spoke this afternoon about rescheduling debt. We were told by Mr. MacDonald and his associates at EDC not to be concerned about the billions of dollars that EDC is lending and guaranteeing. We were told not to be concerned because, after all, they are lending to sovereign nations and no one ever has a bad debt dealing with a sovereign country. Did you ever hear such absolute-no, I'm not going to allow myself to be pushed into rudeness by the vacuity of the answer we received from the officials of the corporation that when you lend money to a sovereign country you don't have to be worried because you are always going to get your money back. Has anybody thought about all those countries in the first world war from which nobody ever got their money back? The bonds are still floating around and are discounted to about one cent on the dollar. Has anyone ever wondered about sovereignty in these instances? What kind of bellywash, what kind of codswallop, what kind of tripe-to use a term that all the farmers and fishermen in this chamber will understand. What kind of tripe and codswallop is it, Mr. Speaker, to say that because you lend to a sovereign nation you are going to get your money back?
Who is going to get their money back from "Zairy"? It is hara kiri to lend to "Zairy", or Zaire, to use the correct pronunciation. They are all rallying around at the moment because there is a bit of an external threat to Zaire. We all know there was an invasion, and it might happen again, and everybody is rallying around. But those people who have made loans to Zaire are very worried gentlemen. The great American banks and the international banks and the countries which got involved all realize they are not going to get their money back from Zaire, at least not for a long, long time-maybe a
Export Development Act
hundred years. Anybody who pays off a Canadian loan in a hundred years time will only be paying about 1/1,000 of the value at the rate of inflation we are seeing today, Mr. Speaker.
Then there is Peru. The hon. member for York-Simcoe mentioned Peru earlier. And in the committee we were told EDC were having problems in Biafra. They are having problems with Turkey. Mexico is looked on with a bit of a jaundiced eye, and India and Pakistan are not all that good. So here is the EDC telling us not to worry about the money they are lending, not to worry about the $26 billion, because they are going to lend it to sovereign countries. Just because it is a sovereign country does not mean you are going to get your money back. We don't swallow that. The hon. members on the other side who are so interested in this debate that they are listening with avid attention to every detail and intend to spring to their feet to try to reply to what I am saying do not believe it for one minute.
The EDC has a lot of shaky money out, and it is going to come due some day. Then they will have to come to this House and tell us about it, because they are an agent of the Crown in right of Canada. This House has to stand behind them and when the Zaire loan goes, and the Peru loan goes, and the Afghani loan goes-if there is an Afghani loan-and the Biafran loan goes, we'll see the minister down trying to lasso the llamas. He'll be in Peru trying to get our money back. He's probably got a chattel mortgage on the llamas down there- off on the last round-up.


Mr. Railton:: I want my money back after listening to you!


John Carnell Crosbie: There is the hon. member for Welland (Mr. Railton). We have a canal right here in the chamber at low tide.


Some hon. Members:: Oh, oh!


John Carnell Crosbie: Don't believe for one moment the story that the EDC are putting out-that there is nothing to worry about in connection with our money. There is plenty to worry about.
We have seen the situation in reverse. I will not mention the place where a certain export credit guarantee department got a little shellacking on the financial side here in Canada. Isn't that an inconsistency? If you try to put up an oil refinery or some kind of installation down in the maritimes you have to go over to England to get the credit and the loans you need. You have to buy English equipment and spend all the money in England. Here we have our own export credit department and they are financing oil refineries and everything else throughout the rest of the world. What kind of a crazy, mixed-up world do we have? It is time for us to have our own domestic EDC here in Canada, as my leader has suggested. When we get in next year I am sure we will be sailing full speed ahead on that one.
We have to be concerned about rescheduling the debt and that is why we want the committee back next year. We want an assurance that we will be back so that we can see what has happened to these loans in the meantime.
80045-6OV2

June 26, 1978
Export Development Act
Does anyone recall reading about Indonesia in the last two or three months and how all the smart American bankers, those debonair and sophisticated bankers who had slashed their money out all over the world, got together in a huddle because Indonesia was going down the spout. Pertomax, or whatever the name of the company was, had the great monopoly. I won't say what part of the body was going up; all are familiar with that expression. All these banks had to get together and be concerned about Indonesia which has tremendous oil resources, oil wells, and yet was unable to meet its obligations. The loans had to be stretched out. Hon. members had better be prepared to see what kind of loss the EDC is going to take.
Evidence before the committee showed that the EDC first put forward proposals to the government for extended limits last fall. That is to be found in issue 29 on page 39. Last October or November, EDC told the Minister of Industry, Trade and Commerce that it had to have the limits increased-that they were going to run out of funds some time this year. The minister dawdled and fiddled around, he diddle-diddled around and talked to his cabinet colleagues. He went out and around at Christmas and he toured his district and worried about his district and he almost changed his district. He should have changed his district-he should leave Alberta if he has any hope of being re-elected. He did all of those things and he did nothing about the EDC legislation. Then he had the gall to come to our financial critic in April and say he had legislation he wanted to see whistle through the House in 24 hours, otherwise he was going to tell Canadian exporters that we were holding up their credit and ruining Canadian export trade.
Where is the minister today? He is supposed to be in Toronto trying to deal with the auto schmozzle, the auto mess, the auto shag-up, the auto round-up. That's where he is today. Otto is blotto and Jack is up in Toronto. And he is probably blotto too, trying to deal with the auto pact. So no wonder he is not here. I don't blame him for not being here. If I had this mess on my plate I would be in Toronto too. Instead of that we are here trying to do business of the country.
Next year you boys will be out. You are going to be on this side and we are going to be over there. We'll be listening to all your foolish criticisms. You may as well get used to it. We will be there solving the problems.
Another interesting point-there are so many interesting points that it is lucky we have a lot of amendments here. The president of the corporation told the committee that EDC had between $6 billion and $7 billion out in the form of obligations. In other words, Mr. Speaker, what happens is that you want to do a deal in some foreign country and you come to EDC and they consider it and they may agree, "Yes, we can do your deal." It's a $100 million deal. "Yes, if it goes ahead as you project it is going to go ahead, we will stand behind you for the $100 million."
Now, that is not legal. That is in the form of a comfort letter or a moral commitment but not a legal commitment. It might be a year or two years before the EDC actually has to enter into a legal commitment for the $100 million or even advance the $100 million, and while we are talking here in this House now-and this was information that came two or three weeks ago-there were $6 billion to $7 billion out in letters from the EDC to various companies and firms and so on in Canada giving them commitments that the EDC would finance various deals that they were hoping they were going to be able to carry on. So their obligations and liabilities are not just what is outstanding at the moment or what is legally committed at the moment; there is another $6 billion or $7 billion apparently that they are committed to in a moral sense and they would look and the country would look and the government would look very bad if they ever went back on it.
That $6 billion or $7 billion is well past their limit. I think that is right, hon. member for York-Simcoe; the $6 billion or $7 billion added to what they have spent to date would be well past their limits?


Sinclair McKnight Stevens: Sure.


John Carnell Crosbie: So the EDC has gone well past their limits that are set in the legislation that is now before the House.


Sinclair McKnight Stevens: That is their problem.


John Carnell Crosbie: That is their problem, as the hon. member for York Simcoe says. In these letters of commitment, not legally binding, they have gone well beyond the present limits in the legislation now. That raises the question: Can we have a Crown corporation that can put us in the position where we have got to follow through whether we like it or not on obligations and commitments that they enter into, not just the legal ones but the ones where they have given people a handshake or a commitment that we would have to follow through if we were individuals? I think that if that is the case, then it certainly behooves us to look very carefully at who is doing what in the EDC and to whom.
I spoke this afternoon on the alarming Goldfarbian tendencies of the advertising of the EDC-I do not need to go into that in any great particular tonight-their misleading advertising, the politically partisan advertising, Liberal-fudging of figures, Goldfarbian tendencies; and it is quite obvious that for upward mobility in the executive ranks of the EDC you might have to be ready to do some Grit grovelling. Grit grovelling will get you ahead, and this is reflected in their advertising.
By the way, this afternoon from time to time there was not one minister in the House. Not one, not a single one. The House is usually vacant of ministers when they are here, but this afternoon it was physically vacant as well when this $26 billion bill was going through.
So, Mr. Speaker, to sum up those several points, the EDC is far too sanguine about the credit risk it is taking. They are not concerned. I mean, what's $26 billion? What's a billion here,

June 26, 1978

what's a billion there? That was the attitude of the EDC. You should have been at the committee to see it. Old C. D. Howe said "What's a million?", and we practically all dropped our teeth. The whole country practically collapsed. He said, "What's a million?", and here is an outfit that says, "What's $26 billion?" They are very sanguine, very easy going, very nonchalant about credit risks and sovereignty. They are the world's greatest exponents of sovereignty. 1 never heard so much talk about it until I got into the committee, and I think we are going to have to see a lot more of this bunch so that they learn just what they are up to and the responsibilities they have got.
The Americans are at this very moment considering their export policy. This is interesting, Mr. Speaker, because down in the United States the legislative branch has some real authority. It has some real get-up-and-go. It has some power. It can make the executive shake with anxiety when the legislative branch decides to do something. Here we are captive of the executive and their members on the other side who do as they are told to do and as they are bidden. But not in the United States. The legislature is the legislature, not the eunuch we are here. Our House of Commons today is eunu-chized. The American House of Representatives and the Senate still have everything they should have.
Now they are trying to search for a new export policy down in the United States. One of the interesting things is, imagine if we put this amendment and it was carried by the House. Well, what a pleasure it would be to look over at the ministerial ranks the next day and and see their faces. One of the things is that the Senate banking committee now has legislation going through the Senate and the House on the EX-IM bank down there. They are moving the loan ceiling up to $40 billion from $25 billion. The Senate banking panel tacked on a requirement that the administration submit to Congress a list of countries eligible for EX-IM credit based on their performance in such matters as-listen to this, Mr. Speaker-human rights, nuclear proliferation and environmental protection.
I think this is a good example for our government to give us. Give us a list of countries, and we will put them in the legislation if we find them eligible, and we look at their performance in human rights, nuclear proliferation and environmental protection. If it was our government they would be saying, "Yes, nuclear proliferation, they must buy a Candu or they won't get our credit". As for human rights, I don't know what their criterion is, or environmental protection either.
This is what Congress is doing down in the United States. Congress itself has decided who they think is credit worthy, and they may attach to the legislation what countries, country by country, are eligible for credit. That is a country that still has a legislative branch, not a bunch of tame pussycats like we have in Canada-on the government side of the House. On this side they are not tame. So, Mr. Speaker, export policy is being looked at down in the United States and also in Britain.


Mr. Pelletier:: You lost the punch line.
Export Development Act


John Carnell Crosbie: I will give you a punch if I get close enough to you. Mr. Speaker, in May and June of 1978 we had another issue of the EDC News. "EDC undertakes largest-ever financing". Every time you look at EDC financing it is the largest ever, and this was a $730 million job, a natural gas processing plant in Algeria. There is no doubt about it, those Algerians need a lot of help.
In Ottawa the Minister of Industry, Trade and Commerce commented. Well, that is no surprise. My surprise in looking at this issue is that he didn't have his picture in it. The last time I looked at the EDC News he had his picture in French and English sections. In this one here it is only the president, Mr. MacDonald, who has his picture, not the minister. The minister slipped up.
This deal is going to create a job ripple. I suppose that job ripple is over in Algeria. It is not going to make much of a ripple in Canada. The EDC 1977 annual report revealed record levels of business, 200,000 jobs for Canadians. I touched on that this afternoon; I will not go into it any more. The figure was never substantiated. "EDC issues the largest one-time insurance cover". Everything is the largest. "EDC's Halifax office officially opened". They have an office in Halifax. They have no office in St. John's yet. If they get an office in St. John's, then we will see what happens next year when they come up before us, but so far they are only in Halifax. They believe a mari usque ad mare or whatever it is-from sea to sea-means from Halifax to Vancouver. They are leaving out the most important part of the country. They have appointed a communications head. Thank God for that because communications haven't had much of a head in the last year or so.
I mentioned this afternoon about the EDC and their funding of two U.S. paper mills. That is a great body we've got there. I suppose we are going to apply to the Americans to give us lend-lease to get our pulp and paper while we are funding theirs down there. I quote from the Globe and Mail of June 8:
Export Development Corp. is finding itself under fire from the pulp and paper industry for helping finance two paper mill expansions in the United States, both of which will produce paper grades that compete with Canadian products . . . $47 million to a newsprint mill in Virginia-
Here is a comment from the pulp and paper industry of Canada:
In a recent speech at a Conference Board in Canada seminar, J. Ian McGibbon, vice-president of finance for Abitibi Paper Co. Ltd. of Toronto, said the EDC's action can "hardly be seen as an expression of confidence in the long term outlook for the Canadian industry."
What is the Minister of Finance doing? The Minister of Finance is trying to perk up the Canadian economy in his own pitiful way, and he is having no success, and he has been Minister of Finance now for what, nine or ten months? He is trying to perk it up, and the Minister of Industry, Trade and Commerce has got the EDC trying to perk up the American economy. What about perking up ours? The Minister of Finance of this government has been licensed by the Prime Minister. He is 007. He is licensed to kill the Canadian economy. James Bond rides again, and all they are able to do

June 26, 1978
Export Development Act
with all these billions of dollars in the EDC is help out the economies in other countries.
I want to quote again. I am not the author of these words. The author is Mr. McGibbon of Abitibi. It can "hardly be seen as an expression of confidence in the long-term outlook for the Canadian industry". It is robbing Peter to pay Paul, and Peter is here in Canada and Paul is anywhere in the world except Canada. What kind of an outfit is governing the country? The left hand doesn't know what the right hand is doing.
We saw that illustrated one night when the Deputy Prime Minister and President of Privy Council (Mr. MacEachen) spoke on a matter about which he knew nothing. That was the pipeline from Alaska down to the United States. He did not know that there had been a study by the Department of Industry, Trade and Commerce. We raised certain questions, he gave certain figures, and he looked piteously to the Minister of Industry, Trade and Commerce. The look in his eyes said: "Help me, please, Jack, help me". Naturally he received no help from "Jack" because "Jack" knew nothing about the report himself; it was only his department.
To go on with the Globe and Mail observations:
Other industry observers have said such loans are an insult to the Canadian industry since Canadian tax dollars are funding the industry's future competitors.
The official opposition did not say that. It was not the NDP opposition. It was not the Social Credit. It was not the independent members. They were not politicians at all who said this. We have made the point here for the last few months that it was the industry. Such loans are an insult to the Canadian industry since Canadian tax dollars are funding the industry's future competitors. What kind of a country cuts its own throat in such a stupid manner? Just to get a few construction jobs for 12 months or 15 months, we are going to build pulp and paper mills in the United States, give them every assistance, low interest cost loans and every assistance under creation. So they put up their own pulp and paper mills, and that is another couple of hundred thousand tons of newsprint that we cannot sell to the United States in the future. What kind of a policy is that?
When we ask about it, we get the stupid answer, the ridiculous answer, "If we don't finance it, someone else will". Well, let some other fool finance it. Why should we do it? Imagine the stupidity of that answer-"If we don't finance it, someone else will". Let the Canadian idiots finance it; that is their answer. Let us be idiots and do it, and not have some other idiots elsewhere do it.
The article continues:
An EDC spokesman said that the corporation would not make such loans if it meant providing a unique Canadian technology to a foreign country, thereby weakening a Canadian industry's unique position.
Have you ever heard such trash? They would not do it in that situation, but they do not mind doing it if it is not a unique Canadian technology. If it is an industry that is not unique, if it is an industry that is already exposed to international competition, and if it is an industry that is already half

to its knees, then go ahead and give it a boost. That is what that statement says. Have you ever in your life heard such junk? An EDC spokesman said that it would not make such loans if it meant providing a unique Canadian technology to a foreign country. It continues:
In the case of the loan to Bear Island Paper Co. for its mill near Richmond, Va., however, Canadian suppliers are competing with those in other countries that can produce similar equipment and also provide financing. If the services and machinery were not bought from Canada, they would have been bought elsewhere, he said ...
That is their justification. The Minister of Industry, Trade and Commerce has taken the same stance. Of course he has taken the same stance, and he has taken the same dance. If they take a different stance tomorrow, he will take that stance. If it changes the day after, he will take that stance, because he does not know what stance to take. He only knows that it is his job to take whatever stance they take.
A second mill, the Richmond mill, will be owned jointly by Bato Co. and Dow Jones. Bato Co. should be the name of EDC. The article continues:
The Richmond mill will be owned jointly by Bato Co., Dow Jones and Co. Inc. and Washington Post Co. Both Dow Jones and Washington Post now buy newsprint from mills in which they are partners in Canada, as well as from other Canadian newsprint suppliers.
Are they going to do it in the future, not in a year and a half or two years, or not because they are going to produce their own? Financed by Canada, they are going to produce their own news points down in the States, and they will not be buying any more from mills in which they are partners in Canada as well as from other Canadian newsprint suppliers. Well, there is no point in beating the thing to death; I just point that out. We have pointed it out in committee and nobody listened. Nobody on the government side cares. We have to hope that the public is listening and caring.


Mr. Boulanger:: That is not what the Gallup poll shows.


John Carnell Crosbie: Did I hear somebody speak over there?


Prosper Boulanger: That is not what the Gallup poll shows.


John Carnell Crosbie: If the Gallup is so good, why do we not gallop to the polls? Why are we not clop-clopping there now? We all thought in July that we were going to be at the old polls, and that we would see whether Gallup was right or wrong. The hon. Prime Minister's feet are so cold that he walks backwards these days.
I mentioned the edition of the Financial Post, the special one on EDC which cost $20,000. Here is a statement that I would like to see EDC prove. This is what I was saying. It is like truth in lending. You should not have to pass legislation to make Crown corporations tell the truth. The ad on the back page of the Financial Post supplement reads as follows: "At EDC, we finance export sales".
That was an astounding bit of information. It continues:
We can also insure them. Or we can guarantee Canadian investments abroad- every dollar thus invested returns an average of $7 in payments, contracts and jobs here at home.
June 26, 1978

Now, I say, prove it. They are unable to prove that they have created 200,000 jobs a year. I want to see EDC show us how every dollar thus invested-whatever that means, because we do not know how it was invested, whether it was insurance, a guarantee or how they did it-returns an average of $7 in payments, contracts and jobs here at home. That is the kind of thing that makes one suspicious of this Crown corporation. That makes one suspect that it is untrustworthy. It makes one suspect that it is a little like that fellow whose nose grew all the time, every time he told a lie, Baron Munchausen. His nose got bigger. There are noses here in Ottawa that would be so long they could not move if we had the same kind of thing going on here. It says that for every dollar spent, there is $7 in payments, contracts and jobs here at home. Do you wonder that we are a little bit suspicious as to what EDC is doing, how well they are doing, what they are doing, and what will be found out in five or ten years time about it?
I am coming to the end of my remarks, I am afraid.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: I want to give hon. members a little theme song which I thought up for EDC. It is patterned after the old engineers' song at university.
We are, we are, we are, we are, we are the EDC We shall, we shall, we shall, we shall from parliament be free From parliamentary control and general scrutiny So boys go in and obfuscate.
The last line does not rhyme, but it gives you the picture.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: The hon. gentleman who is on our committee will be asking me, "Where is the French translation?" I have not got that yet. That sums up what we have found to be the general pattern of operations of the EDC-obfuscation and a general desire not to have any parliamentary control. The EDC generally thinks that it is under control now by having the minister. If that is control, it is certainly easy to get along with.
I have a song for the minister too, but he is not here tonight.


An hon. Member:: Sing it anyway.


John Carnell Crosbie: All right. It goes:
Yippy yi qui yea, I'm on my way
Back to the saddle again
Back on the ranch with time to learn French,
Yippy yi qui yea.
That is where the minister is going to be when the election is called, the one which the Gallup poll shows is so desirable. I wonder why it has not been called to date. The hon. gentleman looked very cross today. He was a cross patch today, particularly when he found out that Canada's handkerchiefs and neckerchiefs were all made in Japan. I bet they were financed by EDC.


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


John Carnell Crosbie: In ending, as I do not want to keep this House unduly, the Auditor General made some remarks in 1975 on EDC which we should also keep in mind. One of the points he made which I think is well worth remembering, is that Crown corporation loan financing derived from external sources should be restricted, and where deemed necessary it should be subject to appropriate parliamentary review through budget submission. That is something for us to keep in mind when we hear these proud boasts that EDC and other corporations do not have to borrow their money directly from the government, that they can go out and borrow on their own. When they borrow on their own, they are still borrowing with you and I behind them, Mr. Speaker. When they borrow, they should be made to come before us so that we can give them a thorough examination.
In ending these remarks-


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


Some hon. Members:: Hear, hear!


The Acting Speaker (Mr. Turner):: He may continue with unanimous consent. Does the hon. member have unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


A. Daniel McKenzie: Mr. Speaker, I wish I could make rhymes and recite poetry like the hon. member for St. John's West (Mr. Crosbie), but I will have to stick to the basics!
This is a very interesting bill. I am sure many Canadian industries and municipalities wish that such a bill was being drafted for them to assist with their problems, which I will go into in a moment. This bill says the proposed amendment to subsection 11(1) would increase the authorized capital of the Export Development Corporation from $400 million to $1 billion and the number of shares from four million to ten million.
We have a number of problems in Winnipeg. Our mayor, Robert Steen, has been dealing with the federal government and the Minister of Transport (Mr. Lang) in respect of aid for an overpass in that city. We need a new bridge at this point and if we could get some financial assistance from the federal government in building this much needed overpass it would create a number of jobs in the Winnipeg area. We would be buying steel, bolts, cement and so on for its construction. The Winnipeg Free Press covered this subject last week when it stated:
Half of all federal urban transit money coming to Manitoba during the next Five years must be committed to the Sherbrook-McGregor overpass before Ottawa will consider giving more money for the $17.8 million project, Mayor Robert Steen of Winnipeg said Wednesday.

June 26, 1978
Export Development Act
But the Mayor also confirmed that the financial offer by federal Transport Minister, Otto Lang is vague and promises "no specific amount"-
When it comes to Tasmania, Zaire and all the rest of those countries there is absolutely no squabble at all and the money is made available immediately. The article goes on to state:
Revealing details of last week's secret federal proposal for the first time, Steen said Ottawa has asked the province to earmark $5 million of its five-year, $10.2 million grant from the federal urban transportation assistance program to the project immediately.
There have been a number of delays, much procrastination and stalling on this. The mayor has been down here looking for aid for a large, needed storm sewer in Winnipeg, the construction of which would create thousands of man-hours of work. Just consider all the material that would be needed, and which could be purchased from eastern Canada and elsewhere to build this much needed storm sewer. This would certainly create a tremendous number of jobs in the Winnipeg area and in industry throughout Canada.
In an article in the Tribune of June 23 it is stated:
A motion to give the Winnipeg Chamber of Commerce the job of attracting industry to Winnipeg will go to city council with the shaky support of executive policy committee.
The six-member committee split on the proposal, with mayor Bob Steen using his second, tie-breaking vote to approve the motion four to three.
The council proposal would give the chamber a six-year contract to study proposed economic development in Winnipeg starting September 1 with the city funding the effort by giving the chamber $200,000 a year. In Winnipeg we have continually to struggle to get storm sewers built, to get support for much needed projects, and struggle along trying to attract industry, while at the same time we are pouring billions of dollars out to other countries.
The hon. member for St. John's West referred to recent criticism by the paper mill industry in Canada. There was a rebuttal to charges made by Mr. Ian McGibbon, Vice-President of Finance for the Abitibi Paper Company. The article I have states:
An EDC spokesman said that the corporation would not make such loans if it meant providing a unique Canadian technology to a foreign country, thereby weakening a Canadian industry's unique position.
In the case of the loan to Bear Island Paper Co. for its mill near Richmond, Va., however, Canadian suppliers are competing with those in other countries that can produce similar equipment and also provide financing. If the services and machinery were not bought from Canada, they would have been bought elsewhere-
As the hon. member for St. John's West pointed out, that is a very strange rationale.
There are two factors involved here. There is criticism in respect of assistance in establishing paper mills outside Canada, and there is the clear indication that the EDC and the Minister of Industry, Trade and Commerce (Mr. Horner) are not consulting with the paper mill industry of this country. They make their rebuttals after they find out about what is going on outside the country. Mr. McGibbon pointed out that:
-one mill will produce the equivalent to half of total Canadian capacity manufactured by Abitibi at its Thunder Bay Provincial Paper mill and by Kruger Pulp and Paper Co. Ltd in Trois-Rivieres, Que. It is a grade that is able

to gain duty-free access to Canadian markets, although Mr. McGibbon is not suggesting the mill is being built for that purpose.
The Richmond newsprint mill will be larger than Abitibi's Thunder Bay mill, Mr. McGibbon said.
There is an open conflict there, and I am wondering why. In 1976 there was a special report compiled for the Minister of Industry, Trade and Commerce entitled "How to Improve Business-Government Relations in Canada". This was forwarded to the government in 1976. It suggested that the way to improve business-government relations in Canada is by consultation with industry. After reading the article I just quoted and referred to by the hon. member for St. John's West, it is obvious that these people are not working toward improved business-government relations in Canada.
The chairman of the task force that compiled this document in 1976, Mr. Roy MacLaren, pointed out to the then minister, the present Minister of Finance (Mr. Chretien):
I have the pleasure to present to you my report "How to Improve Relations between Business and Government in Canada".
The preparation of this report has benefited from the part-time assistance of members of the Task Force on Business/Government Interface (established earlier this year) and from the contributions of senior public servants, a wide range of businessmen across Canada, and the staff of several research institutes.
This is a very noble approach, but it is unfortunate the government has not carried out its recommendations. This study no doubt cost the Canadian taxpayer the usual $250,000, as most studies do, but, like most other studies, it has been absolutely ignored by this government. It is stated in this document:
The need for understanding and co-operation between business and governments in Canada must be evident to all those who believe that a mixed economy is the system best suited to Canada's current needs. Yet few today are satisfied with the state of understanding and co-operation.
That statement certainly is correct. There seems to be a complete lack of understanding and co-operation. We hear these continual complaints from small businessmen in Canada who are having such great difficulty obtaining financial assistance. We know about this by virtue of the number of bankruptcies taking place in the country today. The number is increasing at a terrible rate.
This report goes on to state:
The work of building greater rapport between business and government must be predicated upon clear commitment by both sectors. That work will necessarily be cumulative, with confidence begetting confidence. It will not be sudden; the structure will be built only by brick being placed upon brick. Concurrently, the yet broader task of developing tripartite understanding can be pursued upon a more certain basis.
This is a very interesting document which also points out the following about business perceptions:
We have reviewed the evolution of relations between business and government in Canada, suggested some future trends and noted some general differences in approach between Canada and other OECD member states. Let us now describe in more detail the varied flavour of current perceptions of governments by Canadian business leaders by quoting from our conversations with them:
Co-ordination between governments and business is a prerequisite to the implementation of a successful approach to industrial development during the 1970s . . . but far too many contacts between government and industry continue
June 26, 1978	______________COMMONS
to be coloured by attitudes such as "them" (government) and "us" (industry), as if we did not have mutual objectives.
The less government there is, the better our company likes it.
It is too bad that they do not concentrate more on dealing with Canadian businesses and municipalities with their much needed projects. If the government is going to spend billions of dollars abroad, they could at least direct some of that money into the municipalities. I have given some excellent examples of what we require in Winnipeg, but the city has to go it alone and get the runaround from the Minister of Transport in its attempts to obtain a few dollars to build a much needed bridge and much needed storm sewer. This government's priority, however, is to pump millions of dollars into other countries around the world.
Also in this book, "How to Improve Business-Government Relations", they go on to say:
-a rejection of the idea that business is just another interest group and the corollary conviction that business and labour together create the necessary economic underpinning for the existence of interest groups; a fear that there is no stable ground on which to take a stand between a market-based, investor oriented system on the one hand and "socialism" on the other. Governments are seen as moving increasingly large sums away from the producers to less productive elements in society;
Of course, we are moving large sums away from Canada to assist other countries.
We hear a lot about referendums today. If there was a referendum taken today in regard to EDC and the amount of loans we are making around the world, you would probably find that 95 per cent of the Canadian population would oppose a lot of those loans in light of Canada's current situation of one million unemployed and the high number of bankruptcies.
Another problem with the policies of this government is that it is driving business and investment out of the country. In the first quarter of this year, $1.6 billion of investment money left Canada, more than the whole of last year's total, which was $1.3 billion. The trend here is very dangerous with capital and business leaving the country and the government placing a higher priority on assisting other countries and establishing businesses in these other countries. Canada has many bankruptcies and many cities that need financial aid. If these cities had this financial aid, they would be buying goods and services in Canada, which in turn would create employment.
I hope that the parliamentary secretary or somebody on the government side will bring this document to the attention of the Minister of Industry, Trade and Commerce. One of the first things the minister should do is to take a second look at the tremendous amount of money the government is requesting for the EDC and start directing it toward some of our Canadian cities which need the money more than many of these foreign countries.


Donald W. Munro: The import of the motions now before us, Mr. Speaker, is to impose certain restraints on the limits available to the EDC in its loans. One motion applies to clause 4(a) which reads:
The total of
DEBATES	6755
Export Development Act
(a) the liability of foreign customers for the repayment of the principal amount amount under all loans made by the Corporation pursuant to section 29-
That is in reference to motion No. 3. Clause 4 also provides that the total liability-
-shall not at any time exceed an amount equal to ten times the authorized capital of the Corporation.
What has been suggested in this motion by my friend from St. John's West is that the total liability shall not at any time exceed $2 billion. The other motion is somewhat similar but under a different heading-that the loan shall not at any time exceed $1 billion, whereas we are being asked by this government to accept that the limit shall not exceed $2,500 million.
In other words, we are trying to impose a certain restraint upon the corporation because of the excessive manner in which it is seeking to free itself from coming back to parliament for a greater mandate.
When I was speaking this afternoon on the previous amendment, I had a similar purpose in mind when I referred to the shipbuilding industry and the fact that there had been 51 foreign flag vessels financed by the EDC over the past seven or eight years amounting to approximately $500 million, and the fact that in the last four years the shipbuilding industry had lost approximately 1,000 men. The government, however, claims that the purpose of the EDC is to create or sustain jobs and that it has created 200,000 jobs. The evidence is clear that in the shipbuilding sector there has been a loss of jobs. That is the first balance sheet.
I would like to read a section of the 1977 annual report of the Export Development Corporation. They are fine words, aside from splitting the infinitives to start off sentences. Reading from about the middle of the first paragraph, it says:
Each export transaction must provide significant benefits to Canada-
The fact that there has been a loss of 1,000 jobs in the shipbuilding sector is not a significant benefit by my reading.
-and is reviewed in consideration of such factors as: the level of the Canadian participation in the project-
In the shipbuilding industry, and I hope I am correct in saying this, there has been an actual participation of 100 per cent, and on those grounds the government is probably covered. It goes on to say:
-the nature and degree of sophistication of the Canadian package of goods and services supplied-
In referring to sophistication, we run into another problem. I will admit that while I have been concentrating in the area of shipbuilding, there were man-years sustained in different industries over the course of the last seven or eight years as a result of the activities of the EDC. However, these were short-term in the shipbuilding industry and in fact they have resulted in a loss, because while they may have been keeping our shipbuilders working during the past seven or eight years, there has been a reduction in the number of jobs. Perhaps it is due to advancements in technology, I do not know.
The matter I am concerned with is the long-term gains in the shipbuilding industry, and this is of concern, I am sure, to

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Export Development Act
all Canadians interested in shipbuilding and in Canada as a striving, developing nation capable of producing goods for export. I maintain that one of the things an exporting country ought to be able to do is carry its own goods around the world and bring the goods it needs to its shores. We are not doing this, and this was amply demonstrated in the figures I produced this afternoon.
One aspect that we tend to overlook is the design and development aspect of shipbuilding. What we are being asked to do in building these ships with designs that are brought to our shores by the British, by the French, possibly by the Greeks-or they may have borrowed from others-is just the same in the shipbuilding area as what hewers of wood and drawers of water do in other areas. We are made to be hewers of wood and welders of steel-that is all. There is nothing in the way of Canadian design going into these ships, and yet we are looking at technology which is part of Canada's tradition.
We all know of the Bluenose. In the nineteenth century the Bluenose was developed in Canada as a schooner. It was a beautiful ship which was improved and adapted to different sorts of trade. The design was basic. And then when steam came in, we developed steamships and moved into that area as well, but shortly after the war we began to lose the knack of designing our ships. We went into something pretty adventurous after the war when we built the Bras d'Or. It was a scary job and we went into it in the belief that we could produce a vessel which would have a greater capability than any other vessel doing the job that Canada should do as a member of NATO. We developed that vessel, but unfortunately it had to be put into mothballs before it became operational.
Out of the Bras d'Or came other developments, because it was designed by Canadian designers and developed in Canada. As a result, we were able to produce the best destroyer in the world, namely the DDH. There is no evidence that I can find anywhere in all the answers to my questions to the Minister of National Defence (Mr. Danson) and the Minister of Industry, Trade and Commerce (Mr. Horner) that Canada is continuing to develop and design ships for trade or for our armed services. This is a net loss. Sure, we are keeping our shipbuilders alive, keeping them at work, and that is good, there is no problem about that. But where are our ship designers?
What happened when the Avro Arrow had to fold up because we could not find markets for it? We lost those men. What happened when the Bras d'Or folded? As I said, we moved into building the DDH class destroyers, and the technique and design is exportable. It is being used by other navies, something of which Canada can be proud. The programs that are now in force for building 51 ships for half a billion dollars from foreign designs, to travel under foreign flags, means that we are losing the capacity to design our ships. You know, Mr. Speaker, we are reaching the point now where we will have to design a new military vessel or we will have to buy that design abroad, and I think it is shameful. The way things stand at the moment, we will have to buy our designs abroad. Sure, we will

put them in our stocks, we will be the hewers of wood and the welders of steel, but not the designers of what goes inside that vessel, and that, I think is absolutely deplorable.
That is why I feel that the EDC should be doing more than it is doing. It should be diverting some of its resources to the development in Canada of Canadian technology in the shipbuilding field and in others.
I see here that Versatile Manufacturing is being supported. I say good; Versatile is a good Canadian product and I hope plenty of support is given to it, not just to produce tractors for export but to help the company develop a better Versatile. Those are the things that this country needs. We do not need just R and D. What we need might be called D and D, design and development of high grade technology of which our university people in Canada are capable. We are producing some of the best minds in the world and we are putting them to welding steel plates. Shame, I say, utter shame!
What is the matter with this government that it cannot provide incentives? What is the industry asking for? Here is an outline of the shipbuilding industry assistance program as published by the Minister of Industry, Trade and Commerce. It is stated that the objective of the program is to maintain a shipbuilding capability in Canada for reasons of security, national sovereignty, maintenance of skilled tradesmen, and employment. Boy, the man has himself wrapped up in the flag, that is for sure! It says we are going to maintain our shipbuilding capability, not a ship design capability. To maintain our shipbuilding capability is to just continue maintaining the ability which the Canadian shipbuilding trades have now. What is happening to the assistance program? It speaks of a subsidy of 20 per cent of the approved cost of a vessel built in Canada. The program has no terminal date, but the subsidy will drop to 11 per cent on November 1, 1978. That is quite an incentive! Then it is to drop to 10 per cent on January 1, 1979, and each year thereafter the subsidy will be decreased by 1 per cent, until it reaches 8 per cent. That is a fine incentive to one of Canada's traditional industries!
Where does the following schedule stand in 1977-78? The following schedule provides the breakdown by province of the estimated financial expenditures under this program during the fiscal year 1977-78. Under the 20 per cent subsidy there will be $4.5 million in British Columbia, $10 million in Ontario, $23 million in Quebec, $8 million in New Brunswick, $3 million in Nova Scotia, $21,000 in Prince Edward Island, $1.2 million in Newfoundland, for a total of $52 million in one year. What did I say the EDC assistance was? It is for half a billion dollars.
The shipbuilders and ship designers of this country, to make Canada stand on its feet again as a nation which is proud of its accomplishments and proud of the fact that it can carry its products to other shores and bring the products it needs to our shores, are asking for a very simple thing. In a joint submission to cabinet by the Canadian shipping industry, the Council of Maritime Carriers, the Dominion Marine Association, the Newfoundland Shipowners Association and the St. Lawrence Shipowners Association set down eight points. They want new
June 26, 1978

legislation to restructure the advisory committee because they want elements of industry in the committee. That is fine. Their financial recommendations are along the following lines: debt financing assistance should be similar to that available in other countries engaged in marine activities. I see the minister raising his eyebrows and shaking his head-nobody has told him about this. They propose that future legislation should recognize the advantages of leasing. Shipbuilding assistance should be available at appropriate rates, shipbuilding capital subsidies for new construction or major conversions, and tax incentives.
It seems that the EDC can wander about the world, conclude contracts with Greece, France, the United Kingdom, Panama, Bermuda, the Bahamas, Cuba and Senegal and build ships for these countries while our shipbuilding industry is asking for assistance. Why is there not, even one fraction of the EDC funds available to Canadian industry on the same terms as are available to foreign buyers? It is as simple as that.


An hon. Member:: It is as simple as the minister.


Donald W. Munro: I find it extraordinary that the minister and the EDC should be touting these wares and asking for an increase in the loan limits-and I hope I am right about this-to $26 billion.


Sinclair McKnight Stevens: Loans and insurance.


Donald W. Munro: Loans and insurance, and if I remember correctly this is from something like $4 billion at the present time, maybe $10 billion.


Sinclair McKnight Stevens: Eight billion.


Donald W. Munro: Say $8.5 billion to $10 billion; two and a half times the total limit.


Sinclair McKnight Stevens: The minister shrugs.


Donald W. Munro: Yes. What's $26 billion? It is only twice our present debt, that is all. Why is some of that money not available to Canadian industry to build ships for Canadians, designed by Canadians for use by Canadians and not built to put another flag on them? I find that I am absolutely incapable of understanding this aspect.


Sinclair McKnight Stevens: The minister does not care.


Donald W. Munro: I wonder if the minister is beginning to wonder why it is not a little different too. Maybe he never thought of it. It is about time he did. Unless we are to continue as hewers of wood and drawers of water and welders of plate, Canadian industry must have that sort of assistance for its shipbuilding industry.
I conclude with a final plea. Restraint must be practised if we enter this foreign market with these fantastic sums tucked in our back pockets. Please consider the need of our own industry, in the shipbuilding area particularly, which needs to
Export Development Act
build Canadian ships to carry Canadian goods designed by Canadian minds.


Some hon. Members:: Hear, hear!


Mr. Paul E. McRae (Fort William):: Mr. Speaker, it had not been my intention to speak on this matter today. However, as I listened to some speakers on the other side-not the last speaker because I must say I have a great deal of sympathy for him in his plea for the development of an indigenous merchant marine and for the development of our shipbuilding industry-
I got the impression that if one came into the debate lately, although some of us have been discussing it in committee for some time, one would get the impression that it was some kind of a foreign aid scheme where we loaned money to countries all over the world for some vague purpose because we were fine people.
There is a strong reason for the existence of EDC. We loan money to foreign countries to buy goods made in Canada to create jobs in Canada. Do not buy any of this nonsense, as the hon. member from Winnipeg or the hon. member for St. John's West (Mr. Crosbie) did, about this being a foreign aid scheme. Most hon. members on the other side know perfectly well that every country that is exporting and selling in foreign countries has some kind of an agency like the EDC. Japan has one, Germany has, the United States and so on.


Donald W. Munro: So has Cuba.


Paul Edmund McRae: As a matter of fact the only countries that do not heavily subsidize, directly or indirectly, are the United States and Canada. Other countries subsidize these things very heavily. We cannot possibly sell goods abroad unless we get into this business.
The hon. member for St. John's West talks about his own province. What about the millions of dollars allocated to the Marystown shipyards so they could build tugs for Norway? This is an example of what has happened. I mention this particularly because in my community over the last four or five years we have had in excess of $100 million worth of business through Hawker Siddeley in terms of rail cars to Mexico, and tree farms to Poland. This has created thousands and thousands of man-hours in our community and it is the same all over the country. I have not seen the figures for Winnipeg but I am sure there are many firms in Winnipeg that have created many jobs due to the fact that EDC arranged a loan with some foreign country. I get angry when members talk like this and say that this is some kind of a foreign aid scheme. It is not a foreign aid scheme, it is a scheme to support Canadian industry and Canadian workers. It creates thousands and thousands of jobs.
I have one last point I wish to make. I support the discussions hon. members have had, but one has to admit that these orders to the shipyards at least keep the shipyards going and therefore they should be supported in the same way as a rail car order, for instance, to Hawker-Siddeley in Thunder Bay tends to keep that company going between receiving local Canadian orders. It replaces its capital goods, etc. For these

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reasons, although people can object to certain aspects of this bill, it must be understood that it is a scheme to support our export industry, to support industry across Canada and thus create jobs.


William Hillary (Bill) Clarke: Mr. Speaker, on motions nos. 2 and 4 I want to refer again to the history sheet as I did on the other amendment and remind the House that the present limits under the insurance section are presently SI billion. The amendment is proposing they go to $2 billion rather than the $3.5 billion as proposed in the bill. We think the extension of double the present limits should be adequate for the government, the reasons for which I partly stated earlier.
The other amendment, being the increase from $850 million to $2.5 billion, seemed somewhat excessive so therefore we are suggesting that we amend that increase to $1 billion. The over-all effect of changes or increases given to the EDC since it was incorporated in 1969, a short nine years, as taken the total government commitment from $1.5 billion to the now proposed $26 billion. As I have already mentioned, the profligate spending ways of the government opposite are nowhere better displayed than in the expansion given in the EDC. I may have something else to say about the spending habits of EDC in a moment or two.
I am glad to see that the minister has been able to join us for the continuation of the debate because he was involved in many of the committee hearings. I referred to some of his remarks and his refusal to help us out in the committee on some of the points we felt were important in this debate.
I note also that the parliamentary secretary informed the committee that the Export Development Corporation would be returning in the fall with a rather more complete overhaul type of bill. At that time we repeated our wonderment as to why they felt it necessary to get this huge increase in such a hurry when they would be well able to live within the limits until the fall. In the fall they could have had all this done under the new bill that they are going to be presenting to the House; that is, if we are not involved in an election campaign or do not have a new government by then.
Why should we not take the cautious approach and live within our guidelines? The government was told there are many ways it could exist for the time being with the limits that are there. It is probably impatience on the part of the government. Having been so used to doing things in its own way for so long, it does not want to change its ways and take any kind of reasonable course.
Why should parliament be asked to approve this enormous increase now when the government has told us it is going to change the rules later? Why would any government expect any investor to be willing to put up money now, not knowing what changes in the rules are going to be coming later? The limit is now going to be increased from $8.8 billion to $26 billion, an increase of some $17 billion. It is interesting that in committee and in earlier hearings it came out that the involvement in the

EDC per capita is away out of whack. It is much higher than the EX-IM Bank in the United States which has an authorized ceiling now of $25 billion. That is less than we are being asked to approve for EDC. On the basis of per capita comparisons, the difference is even more pronounced.
The official support expressed as a percentage gross national product in Canada is now just over 1 per cent at 1.05 per cent. In the United States it is .04 per cent. A comparison like that brings home better than straight numbers the extensive overinvolvement that EDC has in the business affairs of this country.
It is pertinent to note at page 61 of the annual report a section on the loans payable. Divulged there is that the loans payable to the Government of Canada and other lenders, and there is no breakdown, totalled $1.5 billion at the end of the fiscal year. The interest rates vary from 5 5/16 per cent to 9 1 /2 per cent per annum.
The government has made a big point of the fact that EDC operates independently of subsidies, that it is a profit-making institution and the taxpayers do not subsidize the operations of EDC. However, I ask hon. members to consider how EDC is able to borrow money at 5 5/16 per cent, albeit that maybe the portion to be paid back during calendar 1978. No one can borrow money at 5 5/16 per cent from the Government of Canada without admitting there is a real subsidy from the taxpayers of Canada. Money at 5 5/16 per cent just is not available to us today.
We know the government will say that is what it was borrowed at a long time ago when rates were lower and it did not have to pay it back until now, and that it is paying it back on schedule. I cannot deny that is within the terms of the borrowing and they are paying it back on schedule. However, to claim that 5 5/16 per cent interest is not a subsidy by the taxpayers of Canada is not being truthful to the House or the committee.
We are not told how much of that $1.5 billion has been borrowed from the Canadian government, although that question was asked in committee. We are only told it is being repaid to the government and that new borrowings are being made in the open market. We do not know where it is coming from, whether it is from superannuation funds or what. It may be significant to note, as is noted in note 4, that some 20 per cent of the amount outstanding in loans of $1.5 billion is borrowed from the United States sources. It is expressed here in U.S. dollars. We do not know whether it was borrowed in U.S. dollars, but certainly the recent action of the Canadian dollar is going to make that more expensive for the Canadian taxpayer when it comes time to repay that loan in American dollars.
I want to say a word about the expenses of EDC. We have been saying a lot about the expensive nature of this company. The president is known to be able to throw a pretty good party. He seems to have a reputation in Ottawa as being one of the big spenders. I know the president told us he only drank 7-Up, but everybody else was drinking champagne. In any event, a $75,000 party must have provided a lot of champagne for a lot of people.
June 26, 1978

I was taking a look at the statement of income and earnings for the year ended December 31, 1977. Although I am sure it is pleasing for the minister and company to note that interest earned and fees earned increased by 32 per cent during the year, neither the minister nor the president of EDC were able to explain how it was that the net income before administrative expenses was only up 9 per cent for the year.
When we had a look at the administrative expenses, we found they were up over $1 million, from $6 million to $7.1 million. That is an increase of 18 per cent during the year. However, the minister found nothing unusual about the fact that the administrative expenses were out of line with the net profit that the company was producing.
In any event, the net income for the year had an increase of only 6 per cent, partly as a result of the increase in the administrative expenses. With an increase in gross of 32 per cent and an increase in net of only 6 per cent, some investors might wonder what is wrong with the management of that company.
A word about the amount of the net income might be appropriate here. This is probably one of the few profit-seeking and profit-making companies in Canada that pays no income tax. Some companies that we can think of, Air Canada for one which has finally turned around and made a profit in the recent fiscal period, are required to pay income tax on their profits. For some reason, it is enshrined in the incorporation act of Export Development Corporation that it is exempt from any burden of income tax on any of its profits. Many businesses in Canada would like to have that privilege and might even be able to show better than a 6 per cent increase in their returns.
We should not leave these amendments without considering who is going to benefit from the increases sought here. I have a note or two which indicates that the government says that many jobs are produced. We went through that this afternoon; I do not need to do so again. I hope the minister will look at these remarks and refresh his memory. In the committee hearings we went through the matter of whether or not there were 200,000 jobs.
In any event we heard about the jobs and we heard there are thousands of businessmen who like to get financing from EDC. We have complained that we should be more careful about the way we are exporting jobs. We should ensure that we are not exporting jobs as well as these beautiful mills we are building and exporting.
Mr. R. H. Summer, vice-president of operations, admitted that the plant being built with a $47 million EDC loan for a newsprint mill in Virginia will compete directly with Canadian mills. The minister, and I think the president, told us this was not the case. However, here we have the vice-president of operations telling us it is. He said this:
-it will obviously increase competition in the more northern part of New England and those states closest to Canada. Thus you could say that, through increased competition, it will in fact compete with Canadian-sourced newsprint.
How can we argue with a fellow who is in the corporation and right on the ground? The government has sought to assure
Export Development Act
us that no matter how many pulp or newsprint mills we build overseas, Canadian business will not have to meet increased competition. The evidence does not support that statement.
What we would like to see was well expressed by the hon. member for Edmonton-Strathcona (Mr. Roche), when he said:
What is badly needed is a national policy for development which harmonizes our interests in Canada with our interests in developing markets abroad.
That is a quotation from one of the committee reports. My hon. friend from Esquimalt-Saanich (Mr. Munro) has argued that Canadian business also needs help from the Export Development Corporation. This may sound contradictory but it seems ridiculous that Canadian companies wishing to expand in Canada are often unable to obtain financing at prevalent rates, yet if they chose to expand their plants across the border somewhere they would seem to qualify for loans from the EDC. We on this side question whether such treatment for Canadian business is right or proper.
There are many businesses which rely on EDC backing. We recognize this but we believe the government has moved much too recklessly in permitting the EDC to expand as it has. The figures speak for themselves. I do not understand how the minister can sit over there and agree with the policy the government is following. The bill before us indicates that the government increasingly believes that it knows better how to do things than does the private sector. It is increasingly putting into place interventionist policies. The fact that its programs have not been working over the past ten years, as evidenced by the present lack of confidence, business dislocation, inflation and all the rest, makes no difference to those who sit on the treasury benches opposite. Finally, I suppose the government will wish to do everything itself; there will be no room for individual entrepreneurship at all.
I will conclude on that note. The direction of government policy as shown by its treatment of EDC over the last nine years must be viewed with great suspicion, because the trend which is being established is one Canada cannot live with.


Arthur Jacob (Jake) Epp: Mr. Speaker, I intend to raise some points which have been dealt with by other members but I want to relate them to the region of Canada from which I come. I am pleased the minister is in the House this evening. During the afternoon he was represented by his parliamentary secretary and the silence which greeted comments from this side of the House was rather obvious.
Now that the minister is here, with his reputation for silence both in this chamber and throughout the country, I am sure that after we are through speaking he will want to make some comment on the report stage of the bill. Indeed, if the minister wishes to speak at this time I would be willing to yield the floor to him. Perhaps he could answer some of the myriad of questions which have been raised. I feel, however, that the minister is not ready to answer questions-either he is afraid to do so or he does not know the answers. Instead of speaking in the House as was his wont, he keeps silent. I recall the days

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when he spoke at the drop of a hat or the flicker of a new idea. Suddenly he finds it safer to speak outside the House to audiences who will not respond by asking questions. He can make his pat speeches, and I must say they read a little better now than they did in the early months when he began to read speeches. As I say, I am glad he is here tonight to give us some information on Bill C-36.
He and his colleagues have asked parliament to guarantee S26 billion in connection with the EDC without offering a word of explanation. All we hear is the hon. member for Fort William (Mr. McRae) suggesting that these are not gifts or outright grants but merely guarantees. The point is that when the loans are not paid back the people of Canada will be left on the hook to sustain a direct loss.
The EDC has been making and guaranteeing loans on the basis that the acquisition of certain contracts create jobs within Canada. On the basis that we are bound to develop an export industry, the minister has my support. But we are bound to consider the over-all picture-the deficits the government has incurred and, in particular, the heavy deficit on current account. I recall the days when the hon. gentleman was on this side of the House and was one of the most vigorous opponents of deficit spending. Today he accepts deficit spending by the government of which he is a member. Indeed, he almost argues that it is good for Canada. I remember his telling us that future generations would have to pay for deficits presently being incurred.
Suddenly all that is changed. While the minister is asking for $26 billion we find there is extreme difficulty in developing industry here in Canada. In Provencher, for example, there is a long established pulp and paper industry. The pulp and paper industry has had difficult times for the last few years competing in the world market because of additional newsprint capacity. Through the EDC the minister has helped to develop an increased international newsprint capacity, but in the pulp and paper industry in Canada-in my riding specifically and in the ridings of other hon. members, especially in ridings where there are similar plants-there is difficulty.
The minister has been very reluctant to advance expansion capital here, but that is not so in other countries. It seems that there is a double standard. On the one hand he will allow a certain benefit so that other countries can develop their industries, but Canadian taxpayers who are contributing to this slush fund are not supposed to benefit. They are not getting the benefits international companies are receiving.
I am talking not only of the pulp and paper industry. I have received a fair amount of correspondence, and I have spoken twice in this House since the appointment of the Minister of Industry, Trade and Commerce (Mr. Horner) about the tantalum mine at Bernic Lake, Manitoba. That mine has known reserves of tantalum, cesium and lithium. In 1974 this government placed cesium under the Export Act. The U.S.S.R. has been using cesium in research and development, especially with regard to coal-burning to increase the capacity of coal for
[Mr. Epp.[
purposes of energy generation. As I say, the government placed it on the export control list.
I have said before to the minister and his officials that I do not object to placing cesium on the export control list, but I have been saying that it is one of the twenty-first century materials which has vast potential. That potential cannot be realized without research and development. The Soviets are ahead in research and development on cesium, well beyond anything we have in Canada. The Soviets have been importing cesium from Canada. When they are moving ahead in research and development, what do we do? We put it on the export control list. However, do we then take the second step and start research and development in order to develop Canadian industry and give us at this point some cesium development so that we can become world leaders? No, we do not do that. Do we do it in order to create jobs? No, we do not need those jobs. Instead we use the EDC and build plants elsewhere.
What are the facts?


Mr. Breau:: The fact is that you can buy it elsewhere.


Arthur Jacob (Jake) Epp: That is exactly the fact. We should create industrial capacity so that we can compete, but instead we export our money and development elsewhere. We will create jobs in the short term that way, but I am saying that we should create long-term jobs in research and development.
This government has finally realized the ripple effect of research and development. It was actually going to increase expenditures in the last budget for research and development. At the present time the U.S.S.R. is number one with regard to the amount of research and development expenditure per capita. West Germany spends 2.3 per cent of its g.n.p. on research and development, roughly the same percentage as the United States, the only difference being that the West Germans are increasing their percentage of g.n.p. on research and development and the United States is not. How much does Canada spend? In 1968 we spent 1.2 per cent, and today we spend less than 1 per cent. If the minister wants to do this extra funding for loans in order to export technology, I say he should look at his priorities again because Canadians are demanding that more money stay here to develop our research and technology and create the jobs that are needed here.
What has happened in the glass-making industry? There is much silica sand in Canada which can be used in the glassmaking industry. In the past most of the Canadian resource has been found in Ontario. I do not want to say anything about silica sand quarrying in Ontario, but the overburden which has to be removed before that sand can be quarried averages 59 feet in Ontario. In Manitoba we have been quarrying silica sand on Black Isjand, and we have tried to develop additional quarrying of silica sand on Deer Island.
I have been in contact with the Department of Industry, Trade and Commerce prior to this minister taking over the portfolio and also since. I have been asking for comprehensive research on the potential of enlarging the glass-making business in Canada, but up until now it has been virtually impossible to get any movement in order to determine whether that
June 26, 1978

industry can expand and whether there is a potential market. In fact, about the only study which was done was by the former provincial administration in Manitoba. That administration did a study on glass-making potential and the Canadian market. I thought we had an abundant supply of silica sand. In doing more research on this I found that we import much of the silica sand we use.
I am the first to concede that some of that silica sand is needed because of the chemical formation in the glass-making process and in foundry processing, but the point is that Canadians today import one million tons of silica sand for glassmaking purposes per year.
The area about which I am speaking is an area where there are native Canadians and Metis residents, and chronic unemployment has been part of the economic pattern of that region. These people have held rights to that island for as long as nine years and have paid claim fees for those nine years in the hope that they would be able to develop a glass-making industry, minimally at least. They would like to quarry the sand and have someone else start a glass-making industry so that they can market that sand. However, what has happened? We cannot even get a study out of the department.
Mr. Speaker, may I call it ten o'clock?


BUSINESS OF THE HOUSE
Stanley Howard Knowles: Mr. Speaker, before we proceed to the late show, I wonder if the Parliamentary Secretary to President of Privy Council (Mr. Pinard) could tell us what the program is for tomorrow.


Yvon Pinard: Mr. Speaker, tomorrow we will deal with the motion in the name of the Prime Minister (Mr. Trudeau), the motion to appoint a special joint committee to study the proposals related to the constitution of Canada. We hope there will be a short debate. Then we will resume debate on the EDC bill, Bill C-36, because the report stage and third reading of that bill must be completed before the summer adjournment.


Stanley Howard Knowles: Mr. Speaker, so that hon. members will know what is happening tomorrow, I give notice that we shall be moving an amendment to that motion to provide that it be a special committee of the House of Commons only.


Lincoln MacCauley Alexander: What is the matter with the Senate?


Yvon Pinard: I understand, even if the hon. member moves an amendment, that the debate will be very short just the same, and that we can resume debate on Bill C-36 for the reasons I mentioned before. We have to complete all stages of Bill C-36 before the summer adjournment.
Adjournment Debate



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Marcel Roy (Laval):: Mr. Speaker, during the question period on June 14 last I put questions to the minister responsible for the Canadian Broadcasting Corporation about the holding of a press conference on June 13 last announcing the programming for the Canada festivities. Naturally, the cameramen and reporters of the Crown corporation were there but I deplored their invisibility and their silence on the evening news program. So I asked the minister to inquire of the Canadian Broadcasting Corporation because Canadians are proud of their commemoration day. Since parliament has set aside modest amounts for the organization of Festival Canada it seems to me that the Crown corporation which receives $487 million from Canadians should cover all the events relating to the national day of Canadians.
My concern, Mr. Speaker, is based on a situation which I deplored two years ago when I informed the president of the Canadian Broadcasting Corporation-and I have here the contents of the correspondence-when I informed him on July 6 last that the CBC had not mentioned at all on any of its news programs the commemoration day of Canadians. That was in July 1976. I received an answer from the president of the Canadian Broadcasting Corporation, and the letter was signed by Dennis Thompson, who recognized that the Crown corporation had not mentioned Canada Day on any of its news programs, citing the reason as being a matter of budget, Mr. Speaker. Because of the restriction period we were going through, CBC commentators had just left out the ceremonies, the activities here on Parliament Hill when the Prime Minister of Canada was giving out certificates of citizenship. They left that day out entirely.
It is because of this attitude and my own experience that I emphasized the importance of these activities to the minister. Not that I am opposed to the coverage we had last week, because I am proud of this. As a French Canadian, I took part in the festivities of June 24. Mr. Speaker, I believe that you took part yourself in many activities in Valleyfield and 1 believe also that the right hon. Prime Minister of Canada attended festivities in Vankleek Hill to celebrate the day of French Canadians on June 24, along with 15,000 other people.
I want to congratulate the public corporation for having covered these events. However, I am concerned about its silence on the activities of Canada Day, which is the day of national unity. I believe I speak for many Canadians who

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Adjournment Debate
would like to make the authorities of the CBC aware of their dissatisfaction concerning certain news or public affairs programs.
I am not an expert, but I am aware of the difficulty that such an expert would have in judging the contents of a program if we consider the lighting, the camera shots, the choice of news, the choice of participants, the choice of music, the editing of films and sound tracks, which all give out a very pervasive and partisan message, but in such a way that it was nearly impossible to define.
We can understand this little game. We have only to read the report of the investigation committee on television which refers to all sorts of the situations which were discovered. Among others, it says that within 10 days, and without counting the provincial premier, Mr. Levesque, Quebec ministers were mentioned 153 times by the spoken media, 145 times on the French network, that is 82 times on television and 63 times on radio, and eight times on the English network. It is mentioned that Quebec ministers were well known personalities in the province of Quebec but almost unknown in English Canada. Federal ministers make less often the headlines on the English network than Quebec ministers on the French network. This is the report of the enquiry committee.
In the light of all those circumstances and considering that my time is limited, Mr. Speaker, I believe that the CBC has the responsibility, through its news services, to encourage a spirit of tolerance, respect, understanding and dignity among Canadians in the interest of national unity. It is unfortunate to see that the Canadian Broadcasting Corporation, instead of promoting better understanding between Anglophones and Francophones or any other ethnic groups, between employers and employees, as it is its duty, chose, through some news or movie programs, to use and develop the potential antagonism between some individuals. The corporation should not orient public opinion towards a given answer but it should at least reflect, in that constitutional debate, the importance of that debate.
I conclude my remarks, Mr. Speaker. After having seriously considered the situation and those comments from the committee, I intend to table, in the near future, a notice of motion reflecting my concern with regard to the Canadian Broadcasting Corporation and suggesting a revision of its administrative controls and a redifinition of its responsibilities concerning the present situation and the many comments contained in the reports tabled in this House.


Mr.   Ed. Lumley@Parliamentary Secretary to Minister of Finance: Mr. Speaker, first I want to thank the hon. member for Laval (Mr. Roy) for having raised that matter tonight. There was a press conference concerning Festival Canada on May 29, 1978 at the national level, in Ottawa. The CBC reporter, Mr. Jacques Rivard, opened the news conference and that news sequence was used for the first news bulletin of the

evening, on the French television network "Ce soir", and in the late evening news bulletin, "Le Telejournal", on the same day.
The French television network also made a report of the press conference in Montreal but, as the essential components of the conference were the same, and considering the volume of news that day, the sequence of the Montreal press conference was not used.
[DOT]	(2207)

As the minister assured the hon. member, he is in complete agreement with him concerning the importance of Canada Week. He has been assured by officials at Festival Canada that the CBC has been working closely with them in conjunction with the upcoming festivities and, furthermore, that both the French and English networks of the CBC have been reacting in a very positive and satisfactory way to the needs of Festival Canada.


FINANCE-DUMPING DUTY ON WIDE-FLANGE STEEL BEAMS
Mr. Ron Huntington (Capilano):: Mr. Speaker, I take serious issue with both the Minister of Finance (Mr. Chretien) and the Prime Minister (Mr. Trudeau) in respect of their replies to me last June 16 as they appear in Hansard at pages 6480 and 6481, whereby my concerns on behalf of the steelworkers and the steel fabricating industry in British Columbia were written off as following a very dangerous course, and that I was advocating ten different markets controlled internally within Canada. The Prime Minister subsequently, as reported in Hansard at page 6482, said I was suggesting a policy that would regionalize the country and, further, he said it was a question of bad economics.
In reply to those charges I must say I was not even associating markets with provincial boundaries in Canada, and both the Prime Minister and the Minister of Finance knew that. Markets in Canada are determined by freight costs and the ability of Canadian producers to supply.
[DOT]	(2212)
Historical records show that there are basically three markets determined by freight rates and the ability of Algoma Steel in Sault Ste. Marie to supply. The Canadian demand for wide-flange beams is 17,000 tons, but the productive capacity of Algoma Steel is 13,000 tons. Their production is allocated on the basis of previous purchases by their customers, and their freight cost factor is approximately twice that of the ocean rate to B.C. ports. The markets in question are: west of the Alberta-Saskatchewan border, east of the Alberta-Saskat-chewan border through to and including Quebec and to a limited extent the eastern seaboard, and then, of course, Newfoundland. The freight cost factor and the ability to supply determines these markets.
Within that market, which I represent as a member in this House, a great injustice is being done to the steel fabricating industry and the steelworkers of that province. That market
June 26, 1978

which they have worked within has been destroyed and delivered into the steel fabricating industries and steelworkers of Ontario.
This example of the Prime Minister's just society might in his opinion be good economics for that region of Canada with all the political clout and good economics for the Liberal Party of Canada, but I can tell you, Mr. Speaker, that it is bad nationalism and disastrous to regional good will which is so precious in Canada today. I am not against anti-dumping safeguards because they are a necessary fact in industrial life.
1 say again that within the spirit of GATT and by precedent of the anti-dumping tribunal, the concept I propose is sensible and equitable for a country such as Canada, covering just less than ten million square kilometers, touching on the Pacific Ocean, the Atlantic Ocean and 4,000 miles of border with the United States.
I ask again that the government reduce the level of regional inequity by accepting the principle that safeguards be applied to those regions or markets where the threat or reality of injury exists, and that safeguards not be applied to those markets in Canada where the threat or reality of injury does not exist.
The wide-flange steel beam situation is volatile and has reversed itself in the last six months. The decision made by the government last June 13 and announced last Saturday, June 24, will create chaos in the B.C. industry because the government has not announced the margin of dumping. The Prime Minister and the Minister of Finance are working against a healthy Canadian federation with this type of confrontation. Once again 1 urge them to rethink the matter and decide in favour of regional equity.
Algoma is playing a very cute game with the west. They are not accepting Alberta orders but, on the other hand, are accepting B.C. orders-not turning them down but saying they cannot supply at this time. Their games leave no alternative but for the B.C. government to reopen the tribunal hearing on the grounds that Algoma cannot supply. This is such a waste when what we need today are jobs and productive work. This policy of the government and its continued rigidity in this direction is costing jobs in western Canada. You cannot keep this country together with that type of centralized policy.


Mr.   Ed. Lumley@Parliamentary Secretary to Minister of Finance: Mr. Speaker, the comments of the hon. member for Capinalo (Mr. Huntington) concern the question of applying anti-dumping duties on wide-flange steel beams imported into British Columbia. He is proposing that the current remission order be extended beyond its present expiry date of June 29. As hon. members are aware, the remission order was provided by the government in order to allow sufficient time for fabricators in British Columbia, as well as in Alberta, Newfoundland and the Yukon Territory, to adjust to the new situation following the decision by the Anti-Dumping Tribunal that imports of dumped steel were causing injury to Canadian producers.
Adjournment Debate
The hon. member appears to base his case on his view that a regional market for these products exist in British Columbia. This view was, of course, not shared by the Anti-Dumping Tribunal when it examined the issue in the terms provided for under the Anti-dumping Act. Hon. members will be aware that section 16(4) of that act requires the tribunal to take fully into account in its determination of injury the definition of domestic injury as provided for in the GATT anti-dumping code. This definition sets out the circumstances in which a country may be divided into two or more competitive markets for the purposes of considering injury to domestic production.
We were advised that the Algoma Steel Corporation is making a considerable effort to ensure that western Canadian consumers will be supplied with wide-flange steel. In this regard, it should be kept in mind that the imposition of anti-dumping duties does not prevent imports and, although western imports of wide-flange steel are down so far this year,
I understand that the availability of wide-flange steel to western Canada is equivalent to that of last year.
With respect to the request concerning the remission of the anti-dumping duties, the government has considered the matter and I understand that a reply has gone today to the premiers concerned. The government has decided not to extend the remission order in view of the fact that the prices at which steel is moving internationally have increased significantly over the past few months by comparison with the unremunerative levels which had prevailed previously.
Nonetheless, many steel mills around the world are working well below capacity and the potential for large shipments of injuriously priced steel into the Canadian market still exists. Against this background, and in view of the fact that the remission program on imports of wide-flange steel shapes for use in British Columbia, Alberta, Newfoundland and the Yukon Territory was intended as a temporary and transitional measure, the federal government has decided not to review the remission order beyond its present expiry date of June 29, 1978.
I can assure the hon. member, however, that the final determination of normal values of wide-flange steel shapes under the provisions of the Anti-dumping Act will be made shortly so that, while injurious dumping of these products in Canada will not be countenanced, the products will land in British Columbia ports as in the rest of Canada at competitive prices. This, I believe, should serve the best interests of all parties concerned.



Benno Friesen: Mr. Speaker, the parliamentary secretary's answer to the hon. member for Capilano (Mr. Huntington) is nothing short of misleading. To suggest that Algoma is planning to do everything it can to supply the western Canadian market, particularly the B.C. market, is nothing short of misleading when just a month ago they put the western Canadian fabricators on allocations, as the parliamentary secretary knows, based on a percentage of

June 26, 1978
Adjournment Debate
the previous year's supply and, as he knows, 1977 was not a year of high sales to western Canada. This means that sales will be decreasing. To suggest that Algoma will do everything it can to supply the western Canadian market is, as I said, nothing short of misleading.
On June 20 I asked the Prime Minister (Mr. Trudeau) the following question:
Since Algoma produces only 13,000 tons, and Canadian consumption is 17,000 tons, obviously Algoma cannot produce for the entire Canadian market. Algoma has already put western fabricators on an allocation system, thereby permanently ensuring they cannot supply that market. Will the Prime Minister now recognize the reality of the regional market that exists in British Columbia and give assurance that the anti-dumping duty will not be re-instated at the end of this month?
The Prime Minister replied in part that it was a temporary measure made with the agreement of British Columbia and other provinces which expressed satisfaction in order to permit all parties to readjust to the current situation. Surely it is the objective of producers in Canada, including Algoma, to try to produce for the entire Canadian market, said the Prime Minister. He went on to say that the temporary measure was reinstated to permit the various parties to adjust to the current reality.
The Prime Minister's reply is great on theory but not great on realism or reality. I know he went to the London School of Economics, and perhaps he pretends he is still there, that Canada is a small island like Great Britain and that one central producer can supply the whole island. Well, I have news for him. The continent on which Canada sits is 4,000 miles across, and one single supplier cannot do what the Prime Minister imagines he should be able to do. The reality is that we have distance to contend with, we have transportation cost to contend with, we have familiarity of market to contend with, and it is human and natural for those producers to supply the market close to home first. They understand that market best and they are doing just that. That is what Algoma is doing. It is even supplying the U.S. market, which is closer to them, before it takes care of the B.C. market, and therefore it is neglecting the domestic market.
Then there are the realities of cause and effect on the construction industry in B.C. Just this afternoon I spoke to one processor in B.C. who told me that in January of this year the price of Japanese plate was $14.50. Today, that same product costs $25 because the Japanese have been scared off from the market in Canada by the anti-dumping decision of this government.
As I have already indicated, Algoma has put the Canadian western market on the allocation system, but they do not call it that any more. Now they call it restricted delivery. They cannot say when they will deliver and they do not confirm the orders. Anybody who has been in business for a short period of time knows that if you want to supply, you have to make a promise of delivery. If you cannot promise that delivery, how can you bid for the contract? The Prime Minister does not seem to understand that kind of economics. Various industrial companies in a telegram to the Prime Minister dated June 5 said, and I quote:

The B.C. industry is therefore unable to purchase their total wide flange requirements from Canadian mills within the necessary time frame, neither can wide flange be purchased from normal offshore sources, because importers are unwilling to import wide flange before determination of dumping duty.
Therefore B.C. industry is unable to fulfill some orders on current projects on schedule or quote competitively on future projects because of uncertainty of supply and prices.
That is the reality of the marketplace in British Columbia today. The Prime Minister say that the B.C. government and others have expressed satisfaction. Then why did the B.C. government in its brief of April 14 ask for two major revisions in that decision on the part of the anti-dumping tribunal, and why in its closing presentation does it say, and I quote:
While the logic of applying uniform economic policies within a single country can be justified the fact that these policies have highly differential impact between the various regions of Canada is factual and it is on this basis that we therefore request that you reflect your understanding of this principle in response to our submissions.
The Prime Minister was nothing less than misleading the House.
Now I come to the human element. I read from a letter from a Kitimat man operating a small fabricating industry. He says this:
Being a reasonably new company of four years, having just completed a new extension giving us 5600 square feet of working area which will enable us to hire from fifteen to twenty men.
Presently we employ six men, three of which are married with families, the extra cost brought on by the this tariff could possibly decrease our work load forcing us to lay-off our present employees adding to the already unemployment situation.
The tragedy and the great irony is that the loss of jobs in British Columbia will create no extra new jobs in Algoma because they are already operating at capacity. What is the sense of this kind of policy that is creating misery for those employed in British Columbia? The role of the government is to make life easier and more equitable for people. Why does the government not admit its mistake and back off and say that there is a regional market that deserves special treatment in British Columbia?


Mr.   Ed. Lumley@Parliamentary Secretary to Minister of Finance: Mr. Speaker, it is most unfortunate that in the adjournment debate the government has only three minutes to reply to each question. On an important question such as the one raised by the hon. member for Capilano (Mr. Huntington) and the one raised by the hon. member for Surrey-White Rock (Mr. Friesen), as well as members on this side who made representation to the minister before, we should have more time in order to prepare a more comprehensive answer.
Without repeating some of the statements I made earlier in answering the hon. member for Capilano, I would suggest most sincerely that the hon. member for Surrey-White Rock refer to section 16(4) of the Anti-dumping Act, which requires the Anti-Dumping Tribunal to take fully into account in its determination of injury the definition of domestic industry as provided for in the GATT anti-dumping code. This definition sets out the circumstances in which a country may be divided
June 26, 1978

into two or more competitive markets for the purposes of considering domestic production. This is really the crux of the whole decision taken by the government.
Freight costs, for example are obviously a very important element in the movement of heavy bulk items such as wide-flange steel beams. This problem is by no means peculiar to these products. It applies across the board to all processed and manufactured goods produced in one area and sold in another area of this country. Personally I am confident that both members opposite are not suggesting that the protection provided Canadian producers under the Anti-dumping Act against unfair trading practices by foreigners be limited to the area of the country in which a producer is located.
In the case of wide-flange steel beams it is clear that the primary competition for the domestic producer is offshore steel landed in British Columbia. In spite of statements made to the contrary by members opposite, the government has made all possible effort to ensure the steel is being shipped to the west coast at the lowest possible cost.
Adjournment Debate
I just want to reiterate the last paragraph of my reply to the hon. member for Capilano. The final determination of normal values of wide-flange steel shapes under the provisions of the Anti-dumping Act will be made shortly so that, while injurious dumping of these products into Canada will not be countenanced, the products will land in British Columbia ports as in the rest of Canada at competitive prices. This, I believe, should serve the best interests of all parties concerned.
This is a very legitimate inquiry by members opposite and by members on this side of the House. I hope when the final decision is taken by the government that the aspect of the layoffs and so on as alleged by members opposite will not come to bear.


Mr. Deputy Speaker:: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at two o'clock p.m.
At 10:27 p.m. the House adjourned, without question put, pursuant to Standing Order.

Tuesday, June 27, 1978