1979-03-05

ROUTINE PROCEEDINGS


Mr. James A. McGrath (St. John's East):: Mr. Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity.
If the House gives the necessary consent to my motion, I forgo the right to debate and I will also forgo the right to present the very substantial arguments supporting my motion. I therefore move, seconded by the hon. member for Bonaven-ture-Iles-de-la-Madeleine (Mr. Bechard):
That this House reaffirms the right of Canadian sealers to go about their legitimate pursuit under the strict supervision of the Government of Canada and the Canadian Federation of Humane Societies, free from harassment and interference.


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


Some hon. Members:: Agreed.


Mr. Speaker:: The House has heard the terms of the motion moved by Mr. McGrath. Is it the pleasure of the House to adopt the said motion?


[Stage Direction]
Motion agreed to.

Mr. Don Mazankowski (Vegreville):: Mr. Speaker, I rise under the provisions of Standing Order 43. In June of 1976, Transport Canada's committee on air traffic services' operational interfaces with aeradio stations outlined serious defects in communications procedures relative to air traffic control centres and aeradio stations.
Since the committee described this situation as being clearly dangerous, and since the recommendations advanced by the
committee have not been implemented, despite their strong expression of the urgent need for immediate action, I move, seconded by the hon. member for Central Nova (Mr. MacKay):
That a clear statement be made by the minister relative to this report, outlining the areas where recommendations have not been acted upon and the reasons for the minister's failure to act.


Mr. Speaker:: The presentation of such a motion, 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.


COMMUNICATIONS
Mr. Cyril Symes (Sault Ste. Marie):: Mr. Speaker, I seek to move a motion under the provisions of Standing Order 43. On March 2, Bell Canada submitted a petition asking the governor in council to overturn the decision of CRTC that revenue from the $1.1 billion Saudi Arabia contract be treated as part of Bell Canada's ordinary revenues for regulatory purposes.
In view of the fact that the CRTC is supposed to regulate Bell's telephone rates according to the level of profitability of Bell's operations and the kinds of contracts and undertakings entered into by Bell Canada and their effects on Bell's earnings, and since Bell Canada has chosen to enter into this contract directly, rather than through a subsidiary operation, thereby making Canadian telephone subscribers liable through increased rates for any loss which might be incurred as the result of the contract, I move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That the House recommend that the petition be denied.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.

March 5, 1979
5.0.	43
O)


HUMAN RIGHTS
[Stage Direction]
5.0.	43
Mr.   C.-A. Gauthier@Roberval: Mr. Speaker, under the provisions of Standing Order 43, 1 ask for the unanimous consent of the House to move a motion dealing with an urgent matter of pressing necessity.
Since it is now obvious that computer snoopers can easily obtain confidential information from national and continental data bank with startling easiness, as evidenced in an article in the Globe and Mail of today entitled: "Computer Snooper Finds It's Easy Work" in which an expert finds it easy to use computers to intrude in the private life of people; and considering that the Canadian government is increasingly dependent on that kind of data to obtain information on its citizens, I move, seconded by the hon. member for Lotbiniere (Mr. Janelle):
That the House take necessary steps in the shortest possible time so that individuals may provide in all security the information required by departments without any fear that such information may be used for unlawful purposes.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


CULTURAL AFFAIRS
Mr. Tom Cossitt (Leeds):: Mr. Speaker, I rise on a matter of pressing necessity concerning the Canadian Council of Christians and Jews, answers given by the Secretary of State (Mr. Roberts) to my recent order paper questions, and another matter related thereto.
I move, seconded by the hon. member for Hastings (Mr. Ellis):
That the government explain immediately the discrepancy between the answer to order paper question No. 293 which shows the total public funds given to the Canadian Council of Christians and Jews during the past year as $767,000, whereas the financial statement of the organization shows total receipts of the organization from all sources, including government and private contributions, to be only $749,000, of which $646,000 apparently came from private contributions; that the government make known immediately whether it is prepared to investigate whether or not renovation funds and rental funds paid by the Canadian Council of Christians and Jews for their new Toronto headquarters in
[Mr. Speaker.!
any way came from government funds for premises located in Toronto in which a Liberal senator is reported to have a substantial interest-


Mr. Speaker:: Order, please. Once again it seems to me the hon. member is working into the terms of his motion some facts in support of the proposition he wants to put forward. 1 think we must be very careful to confine the motion to a motion and leave the debate for later on, if it is accepted. The member seems to want to have it both ways; to put the motion and to put the arguments in support thereof within the terms of the motion itself.


Thomas Charles Cossitt: Mr. Speaker, there is just one sentence left to the motion which I do not think is provocative:
-and, finally, whether certain directors of the council received bonuses of $2,500 from public funds.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


IMMIGRATION
Mr. Robert Daudlin (Kent-Essex):: Mr. Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity.
In view of the fact the Canadian greenhouse industry relies heavily on the announced program of offshore labour and has required labourers thereunder since mid-February for planting, that labour for which contracts were tendered in January for mid-February arrival are due to arrive on Wednesday of this week, and that half of the same are being prevented from so doing by reason of delay in processing by Canadian medical staff, I move, seconded by the hon. member for Bruce-Grey (Mr. Douglas):
That this House instruct the Minister of Employment and Immigration (Mr. Cullen) to waive immediately the requirement of medical examination on-site and instruct his officials to admit all of those Mexican labourers currently ready to travel on Wednesday with a view to processing the medicals in Canada, so as to assure no further delay in planting and caring for the spring greenhouse crops takes place.


Mr. Speaker:: Introduction of such a motion for debate at this time requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.
March 5, 1979



ORAL QUESTION PERIOD


Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, my question is for the Minister of Finance, who late Friday afternoon called a press conference which turned out to be his version of The Gong Show.
In announcing the formation of a National Commission on Inflation, the minister chose not to set any guidelines for the commission to follow respecting prices, wage increases or profit increases. Would he tell us what, in fact, are the guidelines the commission will be expected to follow? Or are we to assume that a price hike of, say, 50 per cent will not worry anyone on the commission?


Hon. Jean Chretien (Minister of Finance):: If the hon. member would read the commission's terms of reference, he would see that we want the commission to identify areas where there is danger there might be heavy pressure on inflation, thus endangering Canada's competitive advantage.
We do not expect the commission to look at all the settlements and price increases; we want them to identify the points at which there is pressure on the system. I have great confidence that the commission, under its chairman, Mr. Renouf, will be able to discuss such situations with the people involved and persuade them that in the best interests of the economy they ought not to proceed with increases which have been judged to be too great.


Sinclair McKnight Stevens: The minister is no doubt aware that the Centre for the Study of Inflation and Productivity came up with some interesting observations about the source of inflationary forces in Canada, including the fact that one-third of last year's inflation was due to the fall in the value of the dollar alone and that much of the rest was caused by the high interest structure due to government policy.
In the light of these observations, would the minister tell us why he chooses not to listen to that body but prefers to turn to a new body which will, presumably, be much quieter and less embarrassing to the government?


Joseph Jacques Jean Chrétien: I do not want it to be quieter, Mr. Speaker. I have responded to the wishes of the House of Commons that it be given greater powers of inquiry. This was not easy to do because of the relationship of that body to the Economic Council. However, we have adopted the recommendations of a lot of people who are interested in the subject by giving this commission the power of inquiry. I hope this will be satisfactory to the public. Everyone will be obliged to give information to this commission.


Sinclair McKnight Stevens: If the purpose of setting up the National Commission on Inflation is not to bury the issue of inflation at
Oral Questions
least for the election period, would the minister tell us why the government has named Harold Renouf as chairman, bearing in mind that he was brought to Ottawa to bury the AIB? Is it not a fact that you want him to bury any meaningful dialogue on inflation in this country?


Joseph Jacques Jean Chrétien: The hon. member wants to make politics out of everything.


Some hon. Members:: Oh, oh!


Joseph Jacques Jean Chrétien: Mr. Renouf came in at the peak of the board's activity. He ran the organization very smoothly for two years, in which he managed to gain the confidence of both business and labour. He is a very competent man, a very good administrator and he has a lot of credibility, something that is lacking in the hon. member.


Some hon. Members:: Hear, hear!


James Aloysius McGrath: We can all take a lesson in making politics from the Minister of Finance, because every time there is an election there is a new commission. We have had five of them since 1969, and in that period the rate of inflation has gone from 4.5 per cent to 9 per cent.
Will this new commission-this illegitimate son of the AIB-be reporting to the House, and hence to the public; or will it, as the minister suggests, be reporting only to cabinet where ministers may suppress its recommendations if they are not to their liking?


Joseph Jacques Jean Chrétien: Mr. Speaker, we have directed the commission to report to the public when it deems appropriate to do so. It is within its terms of reference. Of course, once it has reported to the public, it will be free to report to cabinet but it is left up to its discretion to decide whether the abuses it might have found in the system ought to be made public or not. However, if after consultations and negotiations with the persons concerned, these people still refuse to work in the economic interest of this nation, I am convinced that the Renouf commission will release their names. At the same time, it will be able to make recommendations to the government and we shall study them but all its reports will be made public if it wishes.


James Aloysius McGrath: Mr. Speaker, apart altogether from getting another monitoring agency, which is the fifth such agency we have had, does the government have a strategy to hold down prices to complement the work of this commission? For example, in 1974 the government announced that they would be bringing in a strategy for food prices, a food strategy, and since that time food prices have risen by 50 per cent.
Is there any strategy within the government to complement this commission, especially to hold down food prices and restrain the Minister of Agriculture?

March 5, 1979
Oral Questions


Joseph Jacques Jean Chrétien: Mr. Speaker, we have discussed in this House many times the constraints we have to face with regard to food prices. There are many factors which come into play. There is the fact that we import a great portion of our food and that the price of that food is set at the international level.
I merely want to ensure that when there are price increases, the public is satisfied that there is no gouging by anybody. The commission will look into such matters and report on them. Of course, we must admit that there will always be some price increases in any market economy. We cannot impose controls on prices only and ignore other sectors of the economy. This is why we have decided not to reimpose controls and to expose all the facts to the public.
I hope that the hon. member will support such a move, because both parties on the other side were opposed to controls. We are not planning to impose controls. We want the market economy to operate normally, and this is why we are giving the public the instrument necessary to ensure that it will operate normally.


Mr. Clark:: I think I have heard that before.


REASON NATIONAL COMMISSION ON INFLATION NOT EMPOWERED TO ROLL BACK PRICES
Mr. T. C. Douglas (Nanaimo-Cowichan-The Islands):: Mr. Speaker, I direct my question to the Minister of Finance with regard to setting up the National Commission on Inflation.
Since this is the fifth body which has been set up in less than ten years to cope with the problem of inflation, and since the NCI is to have terms of reference which are almost identical with those given to the first commission, the incomes policy commission headed by Mr. John Young, and since that commission was a total failure in so far as holding down the cost of living was concerned, will the minister tell the House why, in the name of fairness and equity, he has not given this proposed commission the power to roll back prices where they find that there are unconscionable profits or deliberate gouging of the Canadian consumer? How can the minister expect a commission to operate sucessfully when he has already tied its hands behind its back?


Joseph Jacques Jean Chrétien: Mr. Speaker, the government imposed controls in the fall of 1975. When I became Minister of Finance in the fall of 1977, we decided to get out of controls. I am not proposing that we get back into them.
The other problem is that you cannot give an institution such as this the power of rollback under the Canadian Constitution unless it is considered an emergency situation, and the government at this time has concluded that we are not in such a position.
Since we got out of controls in April, 1978, I recognize that generally speaking in the Canadian economy, both labour and management have shown a great deal of responsibility, and I think that we can hope for the best in the future if all facts are put before the public. We have set up this commission for one

reason, and that is because CSIP did not have the power of inquiry. They were not given the power of inquiry because the first ministers a year ago said that they did not want CSIP to have the power of inquiry. The government has concluded that the power of inquiry was needed by CSIP, but as we could not give this power to CSIP we created a new institution.


Thomas Clement (Tommy) Douglas: Mr. Speaker, I have a supplementary question. Mr. Renouf, chairman of the NCI, is quoted in the press as saying that this organization does not propose to require companies or unions to report quarterly on prices and profits, nor does it intend to have access to the confidential information in the possession of Statistics Canada.
Not talking about controls, but talking about gouging the Canadian housewife because of the fact that previous royal commissions have shown that the difference between the price the farmer receives and the price the customer pays in the store cannot be justified, I should like to ask the minister how he proposes that this commission or the government will find out who is gouging the public-whether it is the processor, the distributor, the wholesaler or the retailer-unless they get the information which Mr. Renouf says they are not going to require?
Is this body he is setting up not only to be toothless but also unable to see out of one eye and to be prevented from seeing out of the other one?


Joseph Jacques Jean Chrétien: Mr. Speaker, Mr. Renouf, as head of the AIB, had two inquiries in the last twelve months about profits of the food chains and has seen that the profit margin is nothing abnormal according to the present situation. He will keep monitoring that situation.
Mr. Renouf said that he does not expect to use his power of inquiry very often because he found when he was managing the AIB that the great majority of institutions were quite willing to give him the information he needed. He has the power, however, and I am sure he will use it in cases such as, for example, the president of Dow Chemical and others who have said they will not report to anybody. Everybody will be obliged to report to him, and those who do not will be forced to do so under the law.


Thomas Clement (Tommy) Douglas: Mr. Speaker, a final supplementary question. What does this board have the power to do about specific cases of gouging? I would point out to the minister two instances of this. The first is the steel industry, where the workers settled for an increase of between 6 per cent and 7 per cent while steel industry profits last year went up from $196 million to $296 million, an increase of 45.6 per cent. The other instance is the banking fraternity, where high interest rates have resulted in profits going up by 34 per cent, or nearly $1 billion, and already in 1979 profits have gone up by 36 per cent.
What power does the board have in that situation? If the minister does not think it has the power to do anything, what
March 5, 1979

does he propose to do about calling in the steel industry and the banking fraternity and telling them they are the people who are pushing up the cost of living, and that they must do something about it? What is the government's policy, or is this board simply something to get them through the election because they intend to continue in their slothful state of apathy?


Joseph Jacques Jean Chrétien: Mr. Speaker, we stated in the fall of 1977 that we would return to a market economy, and I do indeed recall that at that time the NDP and the Progressive Conservative party wanted a return to a market economy. That is what we have at present. As for certain aspects of profits, it is normal that companies make profits in a market system, as capital is entitled to dividends, the same way as workers. The question is to ensure that there are no abuses and that is what the commission will do. As for bankers, hon. members will recall, Mr. Speaker, that a few weeks ago, for example, a bank announced that it would raise interest rates for Chargex cards. Following our representations, it reduced these rates. As for bank profits, there was a problem in our system, that we called income debentures, and in our November 16 budget, we eliminated this system by which banks could make profits we found excessive, and the House will be asked to ratify this through the estimates that are presently before the House.


NORTHERN PIPELINES
Mr. Gerard Laprise (Abitibi):: Mr. Speaker, my question is directed to the right hon. Prime Minister.
During his very recent trip to Washington, the Prime Minister seems to have obtained from President Carter the assurance that the American government will soon undertake the construction of the Alaska gas pipeline. Can the right hon. Prime Minister tell us whether, in addition to that promise, President Carter gave an idea of the date around which construction would start, and whether the American President asked something in exchange, such as shipments or exports of natural gas from Canada to the United States?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, it must be understood that President Carter and myself share the same point of view on the whole energy problem. Recent events in Iran have shown us all, I believe, that the problem of the security of supply, the problem of prices can constitute a serious threat unless we take defensive steps and creative measures for the future. It is in that context that President Carter assured me that the American administration would do everything in its power for that pipeline to go ahead, and reassured us that there were no ulterior motives on its part
Oral Questions
because the urgency of the problem had been demonstrated over there just as it was here through the desire of both governments, his and ours, to put in place legislation that would allow us to have a rationing system eventually. We hope we will not have to do so, but the legislation is necessary. It is now before a committee of the House and we trust we will have the co-operation of all parties to expedite passage of that bill.
As for the question of the hon. member on something in exchange, the answer is no. We, of course, discussed eventual exports, but no new project or new contract has been signed or is being planned between the United States and Canada. I took exactly the stand that the Minister of Energy, Mines and Resources upheld here in the House after the report of the National Energy Board was published.


THE CANADIAN ECONOMY
Mr. John Wise (Elgin):: Mr. Speaker, my question is directed to the Minister of Finance. Could the minister indicate whether it is his intention to extend the authority of the National Commission on Inflation to primary agricultural producers, and whether that authority will extend to provincial and national marketing agencies?


An hon. Member:: What about Loto Canada?


Joseph Jacques Jean Chrétien: Mr. Speaker, the authority is not restricted at all, but for cases which are under direct provincial government jurisdiction-for instance, settlement of price increases which come under the authority of provincial governments-the commissioner has been asked to get in touch with the provinces. I spoke twice with all the ministers of finance last week before making that arrangement. Most of them were very pleased and there was no objection from anyone. But in Quebec Mr. Parizeau wanted to consult his lawyer before replying to me. I think that is the only restriction that has been imposed on the commission. The problem of inflation concerns all Canadians in every jurisdiction.


John Wise: Mr. Speaker, my supplementary question is for the same minister. He has been kind enough to indicate that the authority does in fact extend a great deal to the provincial marketing systems. Would the minister care to indicate whether or not it extends to the national marketing systems?


Joseph Jacques Jean Chrétien: Mr. Speaker, I said that no restrictions were placed on the commission's terms of reference empowering it to comment on all sectors of the Canadian economy. Its


LABOUR DISPUTES
Mr. Stan Darling (Parry Sound-Muskoka):: Mr. Speaker, in the absence of the Minister of Labour, I would like to direct a question to the Postmaster General. The mediator-arbitrator appointed by the House under the back-to-work legislation which terminated the postal strike was given 90 days to file the first report with the Minister of Labour. However, he has applied for, and received, two consecutive extensions to this deadline.
Why is the mediator-arbitrator applying for extensions, and are all parties to the dispute agreeing to the extensions? Furthermore, Canadians are interested in knowing the current status of the negotiations.


Hon. J. Gilles Lamontagne (Postmaster General):: Mr. Speaker, I think the answer is rather simple. The mediator-arbitrator was nominated by Bill C-8 through the Ministry of Labour. According to the law, he has the right to ask for extensions to his mandate if he needs time to study the facts and to meet the people necessary in order to complete his arbitration award.
I think the question should be asked of Judge Tremblay as to why an extension was asked for. Apparently the mediator-arbitrator needs time to clarify a few items and to meet some people from both sides, namely, representatives of the employers and employees. I hope he will get his report out as soon as possible. I have no other answer than that, sir.


Stan Darling: Mr. Speaker, according to the president of the Letter Carriers Union, Mr. Robert McGarry, Post Office management has "multiplied like rabbits" in the last ten years, turning the Post Office into an inefficient mess. Given the fact that according to Mr. McGarry the number of managers has increased by 500 per cent since 1968, while the number of workers has only grown by 50 per cent in the same period, I would like the Postmaster General to explain this gross discrepancy, and how does he justify it? Is the presence of too many chiefs one of the points of discontent in the Post Office?


Mr. Lamontagne:: Mr. Speaker, I did discuss with the Deputy Postmaster General the allegation made by Mr. McGarry, president of the Letter Carriers Union. This was done in a very positive and constructive way-not like the allegation which the hon. member just made. We are a little puzzled about the figures Mr. McGarry gave. I would like Mr. McGarry to substantiate his allegation of a 500 per cent increase.


REPORTED PROFITEERING BY WESTERN OIL COMPANIES- MINISTER'S KNOWLEDGE THEREOF
Mr. F. A. Philbrook (Halton):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources. It was reported today that several Arab oil countries are concerned that western oil companies are profiting from unstable world oil markets. In fact, the term "ugly exploitation" was used. It was suggested they will be blacklisted if they persist, whatever that means. Does the energy minister know of anything in this regard? Does it affect Canada, and is he looking into the matter?


Hon. Alastair Gillespie (Minister of Energy, Mines and Resources and Minister of State for Science and Technology):: Mr. Speaker, I am not aware of any profiteering of that kind. As I have indicated in the House, there is always the possibility that trading companies could be trying to cream off profits in a way that does not necessarily assist the Canadian national interest. Indeed, I have made it quite clear if that was the result of the Exxon diversion, the Petroleum Compensation Board would intervene, it would check the invoices and ensure that any such higher prices would not be passed through or be compensated for by the Petroleum Compensation Board.


NATIONAL DEFENCE
Mr. Allan B. McKinnon (Victoria):: Mr. Speaker, my question is for the Prime Minister. I would like to ask the Prime Minister if the subject of our broken financial commitment to NATO was discussed during his visit to Washington.
Last June, the Prime Minister promised NATO that Canada would increase its over-all defence budget by 3 per cent in real terms. Estimates now indicate a cut in real terms. Could the Prime Minister give an explanation to the House for this drastic shortfall?


Pierre Elliott Trudeau: Mr. Speaker, the matter was not raised by President Carter. Obviously, he does not share the concern, real or feigned, of the hon. member.
As to the amount of the estimates, I do not have them at hand and I would have to defer to the Minister of National Defence to answer this question. I believe that over a five-year cycle we have budgeted for the undertakings that we gave of a certain rate of growth, particularly real growth, in capital expenditures but I do not have the figures at hand.


CONTRACT SIGNING DATE FOR NEW FIGHTER AIRCRAFT
Allan Bruce McKinnon: Mr. Speaker, in the absence of the Minister of National Defence-on duty somewhere, I am sure-I would like to point out to the Prime

March 5, 1979

Minister that the Minister of National Defence last May projected a contract signing date for the new fighter aircraft for the fall of 1978 which has now been postponed to late fall, 1979. Could the Prime Minister give an explanation to the Elouse about a defence project that in less than a year has fallen behind more than a year?


Pierre Elliott Trudeau: Mr. Speaker, 1 have information that the Minister of National Defence is touring the National Defence Medical Centre in Toronto.


An hon. Member:: He is sick.


Pierre Elliott Trudeau: On the project the hon. member is referring to, I repeat that I do not have the estimates and the knowledge before me. It is quite clear that when I announced last summer that the government would be cutting some $2 billion from its projected expenditures, it did mean that many projects in many areas of the economy-and I do not see why National Defence would have to be an exception, provided we live up to our over-all commitments-and would be deferred. This is perhaps one which will take one year more than originally anticipated.


LOCATION IN ONTARIO OF HEXAFLUORIDE REFINERY FOR ELDORADO NUCLEAR
Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources. I understand the environmental assessment review panel has reported that there are no environmental difficulties in building in Ontario, at either of three separate sites, a new hexafluoride refinery for Eldorado Nuclear. I wonder if the minister could indicate when a decision will be made respecting that location.


Alastair William Gillespie: Mr. Speaker, I expect it will be soon.


Allan Frederick Lawrence: By "soon", does the minister mean in a matter of days, weeks, months, or after the election? Second, can the minister tell the House whether the decision will be his, or whether it will be a cabinet decision on the recommendation of the minister?


Alastair William Gillespie: Mr. Speaker, I will be discussing this with my colleagues and in all probability it will be a decision of cabinet. 1 can tell the hon. member that I have received a good deal of interest with regard to this question from the hon. member for Algoma. He earlier came to me and asked exactly the same question, how soon could he expect an answer with respect to the particular refinery. Indeed, the hon. member for Sudbury has also expressed an interest in this question. I hope there might be an answer on this matter in the very near future.
Oral Questions


THE CANADIAN ECONOMY
Mr. David MacDonald (Egmont):: Mr. Speaker, my question is to the Minister of Finance. The minister said in Toronto recently that the job shortage is partly a result of the increased participation of women in the work force over the past few years. In particular he said, "We expect this rapid increase will taper off in the future".
Since previous estimates by his department were so woefully wrong with regard to participation rates for women, necessitating a report to the first ministers' conference last November because of its previous wrong projections, a statement that the department had underestimated to some extent the future of females and hence the aggregate participation rate-causing, I might say, untold hardship for women through the cutback by his colleague, the Minister of Employment and Immigration- can the minister now indicate on what he bases this projected decrease in the rate of entry of women into the work force? Is this a direction that his department is now promoting or supporting?


Joseph Jacques Jean Chrétien: Mr. Speaker, it is obvious that the rate of increase has been very high in the last few years. We do not object to it. We have said it is a fact we have to live with, that there are more women coming into the labour force than before. We welcome that. However, it is a problem for the total economy: we have to create an equivalent number of jobs to accommodate this increase.
The participation rate has increased very rapidly over the past four or five years. It is evident that at some time it will taper off. When you compare the spread in most of the developed nations, it is evident that ten years ago in Canada the participation rate of women in the labour force was lower than in the United States and in European countries. The gap between Canada and the United States is now virtually nil. It is evident from that the acceleration will stop very soon.


David Samuel Horne MacDonald: Mr. Speaker, I am grateful that the minister is not opposed to women entering the work force. I am sure there will be a lot of comfort as a result of that statement.
Since the minister mentioned other countries, can he indicate whether in fact there will be any publication of new labour force growth projections by his department based on the recent report of the Organization for Economic Co-operation and Development, which in its own survey indicated considerable growth both in the United States and in European countries with respect to increasing participation rates for women in the work force? If the minister has read those reports, can he advise if his department is going to publish new figures which would indicate a much more optimistic and realistic projection than the one the minister enunciated in Toronto?

March 5, 1979
Oral Questions


Joseph Jacques Jean Chrétien: Mr. Speaker, I will obviously be happy, when I report to the House on this matter, to make the necessary adjustments if my estimates are wrong. These studies are now being made throughout the world. I have read reports stating, for instance, that in certain European countries the participation rate of women in the labour force has decreased over the last three years. I am not in a position, therefore, to make a full report. I am following this situation as closely as possible, and I will be happy, at the first opportunity, to report back to the House, with the required adjustments if necessary.


NATIONAL COMMISSION ON INFLATION-POWER TO PREVENT EXCESSIVE PRICE INCREASES
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, 1 have a question for the Minister of Finance. I want to ask about a couple of specific price increases and what the commission will do about them.
Price increases have been brought to my attention by housewives who have been shopping. In the last six months, the price of raisins in this country has more than doubled. That is based on information that the wholesale price has gone up by 74 cents a pound and the retail price in Toronto by $1.64 a pound. Therefore, the rip-off is a 90 cents a pound increase in six months. What, specifically, can the National Commission on Inflation do about such an obvious rip-off as is now occurring with regard to raisins in this country?


Joseph Jacques Jean Chrétien: Mr. Speaker, the hon. member has concluded that it is a rip-off. There are many factors that do not show in a price increase. Most of the time the biggest part of the price increase is because the goods are imported and the price abroad has increased faster than in Canada. We want to make sure retailers in Canada do not abuse their position.
The AIB made a review of this during the summer, and another review last month. They concluded that, generally speaking, the mark-up by retailers in relation to their sales has not increased in the last while. If the hon. member has proof of a rip-off, he should give that to the commission, which will certainly investigate. The hon. member makes the sweeping statement that it is always a rip-off. I think the rip-off is probably very much in his own mind.


Lorne Edmund Nystrom: Mr. Speaker, I am not talking about a general situation; I am talking about something specific. The wholesale price has gone up by 74 cents a pound and the retail price in Toronto has gone up by $1.64. The difference between the Canadian wholesale price and the retail price is 90 cents. That has occurred in the last six months. This is the Canadian dollar; it does not concern imports.
What will the new commission do about specific charges such as this? Why does the minister not give them the power, not for a general control on prices but to stop gouging of this sort where it finds that gouging has indeed occurred?


Joseph Jacques Jean Chrétien: Mr. Speaker, the hon. member is being completely unrealistic when he says they should have the power to roll back on one item only. He knows that when you have controls, you have to control the whole economy. You cannot impose controls for 24 hours on one product; that will not work.


OFFICIAL LANGUAGES
Mr. Stan Schumacher (Palliser):: Mr. Speaker, my question is to the Prime Minister. In view of the fact the Leader of the Opposition has characterized the language policies of the government as being divisive, can the Prime Minister say whether an opportunity will be given to the House to express itself on the question of the constitutional entrenchment of language rights prior to dissolution?


Pierre Elliott Trudeau: Mr. Speaker, once again we are faced with an answer which would depend on the date of dissolution. I repeat the undertaking that the House leader and myself gave about ten days ago, that it would be the desire of the government to refer, hopefully, to a joint committee of the other place and the House of Commons the report of the Official Languages Commissioner. We hope that a debate on that will permit members on both sides to indicate their particular party's policy on the language question which the hon. member quotes his former leader saying "as being divisive".


Stanley Stanford Schumacher: Does the Prime Minister have any intention of tabling a replacement of Bill C-60 before dissolution?


Pierre Elliott Trudeau: Mr. Speaker, I believe I indicated at the press conference following the first ministers' conference in early February that if we were sitting long enough, we would want to do that. However, it might not be the entire contents of the former Bill C-60: it might be more specific in some areas. If there is such a bill, I can assure the hon. member that one element of it would be a bill of rights, including a bill of rights in the language area.


GOVERNMENT ADMINISTRATION
Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker, I would like to direct a question to the Minister of Finance. When the AIB was implemented there was some concern on this side of the House as to the extent of the bureaucracy. In 1975 we were told that this bureaucracy would be approximately 200, in 1976 we found it had grown to 485, and in 1978 we were looking at the figure of at least 635.
March 5, 1979

We now have the National Commission on Inflation. What assurance can the minister give the House that we are not setting up yet another massive bureaucracy that will grow just like Topsy?


Joseph Jacques Jean Chrétien: Mr. Speaker, I had discussions with Mr. Renouf and he does not intend to have a commission with more than 100 employees. Of course, at this time he will recruit his personnel from people available in the CSIP and people now employed by the AIB and due to complete their work in the next few weeks or months.
I think that the combined elimination of CSIP and AIB and creation of that new commission will result in fewer people monitoring inflation than there were at the beginning of the year.


Lincoln MacCauley Alexander: Mr. Speaker, we have heard those words before. In 1975 only 200 were to be involved. We then arrived at the figure of 635. I assume the minister is now putting his seat on the line with regard to this figure of about 100.
I would now ask him this question: Are the personnel being taken from CSIP and AIB personnel? Is that the understanding? Is the minister now stating that he does not envisage more than 100 people working for the National Commission on Inflation?


Joseph Jacques Jean Chrétien: Mr. Speaker, I understand that the number of people working for the new commission will not exceed 100. The number of people working for CSIP at this time is, I think, 74. A few hundred people are working for the AntiInflation Board. The Anti-Inflation Board will finish its work within a matter of weeks. I explained earlier that if we now have 100 and a couple of hundred disappear, we are gaining.


Lincoln MacCauley Alexander: We don't want any more.


FINANCE
Mr. Lloyd R. Crouse (South Shore):: Mr. Speaker, I wish to direct my question to the Minister of Finance. A total of $498 million in Canada Savings Bonds was redeemed as of February 21 this year, compared with $117 million at this time last year. Since Canadians are galloping to the banks to vote no confidence in this government through the sale of one-fifth of their bonds, is the minister making any plans to encourage them to hold on to the other four-fifths and, if so, what are they?
[ Translation]


Joseph Jacques Jean Chrétien: Mr. Speaker, people are totally free to do as they wish with their investments. We have several methods to get funds, and Canada
Oral Questions
Savings Bonds are one of them. Canadians have a lot of savings, and one of the indications that they do is that they must make a little money.


EXTERNAL AFFAIRS
Mr. Jack Murta (Lisgar):: Mr. Speaker, my question is to the Prime Minister, if I can get his attention. In bilateral talks with Canadian officials later this month the United States will be seeking to deregulate across-the-border travel which, if proceeded with, will ultimately mean cheaper air fares for people travelling into and out of Canada.
Is it the government's intention to adhere to the 1974 air services agreement which allows one country to block the other's cross-border fare proposals; in other words, to stay away from any kind of deregulating process between the two countries?


Pierre Elliott Trudeau: Mr. Speaker, I would have been happy to deal with the question if the hon. member had given me notice. Having had no notice, I can only take note of the question on behalf of the minister, who is busy and will be in the House presently.


RESEARCH
Mr. Elmer M. MacKay (Central Nova):: Mr. Speaker, I have a question for the Minister of Supply and Services. I would like to ask the hon. gentleman whether we can expect an announcement in the near future regarding the awarding of an important contract for research trawlers. This matter is the subject of a great deal of anticipation in certain areas of Nova Scotia, particularly at the historic port of Pictou.


Hon. Pierre De Bane (Minister of Supply and Services):: Yes, I think the government will soon be in a position to announce a decision in that regard, and I hope that the population of Nova Scotia will be pleased with it.


INDUSTRY
Mr. Paul McCrossan (York-Scarborough):: Mr. Speaker, my question is to the Prime Minister, in the absence of the

March 5, 1979
Oral Questions
Minister of Industry, Trade and Commerce and the Minister of State (Small Business).
On February 6 I raised a question in the House with the Minister of Industry, Trade and Commerce about the severe shortage of steel in the country and what plans the government had to assure Canadian businesses that they could receive supplies. I received a reply from the minister, who said that the government was making every effort to ensure supplies to Canadian businesses. Just one week later, one of my constituents received a letter from the Minister of State (Small Business) which stated that it is unfortunate that Canadian mills find it impossible to increase output quickly and that in the meantime many steel users are turning to imports to supplement domestic supply.
Is it government policy now to encourage imports of steel for Canadian manufacturers, or does the government have a policy of trying to assure Canadian manufacturers adequate steel supplies as the Minister of Industry, Trade and Commerce indicated?


Pierre Elliott Trudeau: Mr. Speaker, of course, I do not know what particular representations were made to the hon. member, nor from where; but the hon. member will recall that very few months ago we were receiving representations, from the west coast in particular, that we should keep Canadian steel out of British Columbia in order that we might import steel from overseas.


Mr. Friesen:: We can't get any.


Pierre Elliott Trudeau: I understand, and that indicates how the economy is booming. The steel industry is now producing at full capacity. Just a few months ago there was an excess of steel in the markets of the world. Thank goodness the Canadian steel industry, its workers and investors have proved particularly efficient in ensuring that they could not only survive that period but also come through it with production at full capacity.
Hon. members opposite have flip-flopped completely, as usual, and are complaining that there is not enough steel. They were complaining about too much just a few months ago.


STEEL NEEDED FOR EXPORT OF MANUFACTURED GOODS TO UNITED STATES-GOVERNMENT MEASURES TO ASSIST
William Paul Joseph McCrossan: Mr. Speaker, I find it incredible that the Minister of Finance is saying that because of the devalued dollar our finished goods export opportunities will increase, but that the government is taking no steps whatsoever to ensure that our manufacturers can get steel.
What steps is the government taking to ensure that small Canadian businesses can get the steel they need to export manufactured goods to the United States?


Joseph Jacques Jean Chrétien: Mr. Speaker, for a year I have been advising Canadian businesses to make plans for the time when Canadian production capacity will be
[Mr. McCrossan.)
completely utilized. Had they made investments earlier in higher capacity, there would be more steel available now. The problem at this point is that the steel industry is still functioning at full capacity, and when we are faced with full capacity we run into shortages.
I will refer this matter to the Minister of Industry, Trade and Commerce, and I hope Canadian producers will see that it would be in their best interests to keep their Canadian clients happy, because they are the industry's best clients.


FORESTRY
Mr. F. Oberle (Prince George-Peace River):: Mr. Speaker, I have a follow-up question for the Minister of State (Environment), who is also responsible for forestry.
Is the minister in a position today to tell the House and forest scientific staff who are engaged in forest products laboratories in Vancouver and Ottawa to what extent his efforts to privatize these institutions have been successful, whether the lay-off notices which have been mailed out by his department and which are to be effective April 1 are still to be effective, and whether sufficient capital has been found to defray the cost of these services?


Hon. Len Marchand (Minister of State (Environment)):: Mr. Speaker, the move to privatize the two laboratories is going very well. I sent the hon. member a press release a few days ago, or perhaps last week, indicating that the interim board of directors has been very successful in its quest for funds. The board is very hopeful that all the employees now working for the laboratories will move over and work for the new organization. I have also been told by Mr. Bob Rogers that the board's quest for funds from various sources has been successful in the initial stages.


Frank Oberle: Mr. Speaker, it is precisely because of this press release that I have been concerned. Even though this group has had some meetings and has passed the hat-to use the minister's words-around the country, there has not been a firm commitment to these people that they will have jobs after April 1. The question is whether the minister will communicate to this constituency that they will be assured of a job after April 1, or of someone to sign their pay cheques after that date?


Len Marchand: Mr. Speaker, the interim board of directors of Forintek, which is a new organization, has indicated very clearly to its employees that they have been offered jobs. As I said before, I hope the employees will see fit to become members of the new organization. I am very confident that this can be accomplished, as is the new board of directors, and that the privatization of these two labs will take place efficiently.
March 5, 1979


PUBLIC WORKS
Mr. R. E. McKinley (Huron-Middlesex):: Mr. Speaker, I have a question for the Minister of Public Works, but in his absence I should like to put it to the acting minister.
Since the minister announced outside the House on Friday the government's plan for a Public Works Lands Company to administer peripheral lands at Mirabel airport, would the minister do us the courtesy of explaining what the purpose of this company is, and why it requires the expenditure of over $8 million in the coming fiscal year? Will it possess any assets currently held by the Department of Public Works, and will it be hiring any employees who have been working for the Department of Public Works?


Mr. Hal Herbert (Parliamentary Secretary to Minister of Public Works and Minister of State for Urban Affairs):: Mr. Speaker, this is an existing body within the Department of Public Works at present and it will be taking over the organization of the area within its own terms of reference. It is not a new body and therefore the existing employees will be operating it.


Robert Elgin McKinley: It seems to me that this is a ploy on behalf of the government to cut down on the losses and not show them, losses that are being experienced in the operation of that white elephant.


Harold Thomas Herbert: Mr. Speaker, there was no change whatsoever in the budget-the same employees and the same budget.
An bon. Member: And still a white elephant.


PRIVILEGE
Lloyd Roseville Crouse: Mr. Speaker, I rise on a question of privilege. It has never been my policy intentionally to mislead the House. Since I asked my question of the Minister of Finance (Mr. Chretien), I have learned that my figures were incorrect. I would appreciate the opportunity to put the proper figures on the record. As of February 28, total redemptions in 1979 of Canada Savings Bonds exceed $541 million, which is a rate of almost $12 million per banking day. Last year, only $133 million in bonds had been redeemed, over $3 million a day.
Order Paper Questions



ROUTINE PROCEEDINGS


[Stage Direction]
On the order: Government notices of motions:
March 2, 1979-The Deputy Prime Minister and President of the Privy Council:
That a Special Joint Committee of the Senate and the House of Commons be appointed to consider the report of the Commissioner of Official Languages, 1978, tabled Tuesday, February 20, 1979 (Sessional Paper No. 304-1/301);
That 20 members of the House of Commons to be designated by the House at a later date be the members of the Special Joint Committee and that Standing Order 65(5) of the House of Commons be suspended in relation thereto;
That the said committee have power to send for persons, papers and records and examine witnesses; to sit during periods when the House stands adjourned; to report from time to time and to print such papers and evidence from day to day as may be deemed advisable and to delegate to subcommittees all or any of their powers except the power to report direct to the House; and That a message be sent to the Senate requesting that House to unite with this House for the above purpose, and to select, if the Senate deems it advisable, some of its members to act on the proposed Special Joint Committee.
Mr. Speaker:: Pursuant to section 2 of Standing Order 21, this notice of motion is transferred to and ordered for consideration under Government Orders 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 Deputy Prime Minister and President of the Privy Council):: Mr. Speaker, the following questions will be answered today: 26, 811,885,919, 949 and 1,188.
I ask, Mr. Speaker, that the remaining questions be allowed to stand.


Mr. Cossitt: 1.	What was the total amount of funds expended on all aspects of the Rideau Canal during the last fiscal year?
2.	What is the estimated amount to be expended for the current fiscal year and, what amount is for (a) maintenance and new construction (b) salaries?
3.	What is a list of all locations on the Canal where work was done last year and, in each case, what (a) was the amount expended (b) is a description of the work?
4.	What is a list of locations where work is being done this year and, in each case, what is (a) the amount being expended (b) a description of the work?


Yvon Pinard: In so far as the Department of Indian Affairs and Northern Development is concerned:

March 5, 1979
Order Paper Questions
1.	1977-78 Operating & Maintenance
Capital


[Stage Direction]
Total
[Stage Direction]
(b) Normal maintenance of ice surface and facilities and design of new skate/boat facility.
2.	1978-79 Estimated Expenditures
(a)	Operations, Maintenance & New
Construction	$4,058,800
(b)	Salaries and Wages	$2,480,660
Total	$6,539,460
3.	Major Work was carried out at the following locations in 1977-78
	(a)	(b)
Ottawa	$ 209,000	Start pedestrian circulation and landscaping-Ottawa LocksLong Island	1,596,000	Start replacement of waste weirNicholsons	16,000	Repairs to wallKilmarnock	229,000	Repairs to lockBeveridges	53,000	Repairs to lockBrass Point	512,000	Start replacement of bridgeKingston Mills	214,000	Repairs to swing bridgeKingston Mills	44,000	Interpretive facilityHogs Back	347,000	Replace dam, bridge and houseChaffeys	235,000	Repairs to lock
4. Major work is being carried out at the following locations in 1978-79:
Mr. Jones: 1.	Are there language requirements for employees of Canadian Post Offices and if so, what are they? Is language training available to all employees of Canadian Post Offices?
2.	If language training is not available, how is the criteria for language proficiency met (a) for currently-employed postal workers and (b) for any new employees?
3.	Are supervisors in Canadian Post Offices required to hire a certain percentage of English to French employees, with those above mentioned languages as their first tongue?
4.	Are posts within the Canadian Post Offices classified as bilingual and if, so, what are they? Are posts within the Canadian Post Offices classified as unilingual English and if so, what are they? Are posts within the Canadian Post Offices classified as unilingual French and if so, what are they?


Mr. D. M. Collenette (Parliamentary Secretary to Postmaster General):: 1. (a) Yes-there are language requirements and these are based on the functions and job description of positions. For each of the four skills (reading, writing, listening and speaking) the Public Service Commission recognizes three types of levels of proficiency which we have to follow to establish the language requirements required of incumbents to satisfactorily perform their duties.
Ottawa	$ 280,000	Pedestrian circulation and landscaping at Ottawa LocksLong Island	170,000	Complete the replacement of waste weir. Bulk of thisproject was completed last fiscal year.Burritts Rapids	225,000	Replace entrance walls on both sides at the upper end of lockMerrickville	365,000	Replace two fixed bridgesNew boro Cut	445,000	Newboro Cut to be dredged and banks stabilizedBrass Point	1,375,000	Replace Brass Point Bridge. Work was started last fiscalyearUpper Brewers	150,000	Repairs to lower lock
In so far as the National Capital Commission is concerned:
1.	$367,270.
2.	$358,000.
(a)	$168,000.
(b)	$190,000.
3.	No specific locations but general skating area between the Chateau Locks and Hartwell Locks and Dow's Lake.
(a)	$367,270.
(b)	Normal maintenance of ice surface and facilities.
Type	Level(s)	Codei	General	Superior	CIntermediate	BMinimum	Aii	Instrumental	Limited	Rhi	Technical or professional	Particular	P
(b) Yes and the priorities are set forth by the Public Service Commission.
2.	Not applicable.
3.	No. Positions are staffed in accordance with the requirements of the job.
4.	(a) Yes, there are positions in Canadian Post Offices identified as bilingual. Supervisory positions as well as positions serving the public mainly those of wicket clerks in areas where there is sufficient demand to warrant services in both official languages.
(b) and (c) Yes, based on the functions and duties to be performed there are positions identified as English essential or French essential only.
4.	Design of new skate/boat facility adjacent to the canal at Fifth Avenue in addition to general skating area between the Chateau Locks and Hartwell Locks and Dow's Lake.
(a) $358,000 including design fees for new skate/boat facility.
[Mr. Pinard.)


Mr. Howie: 1.	What is the flying range of the F-16 and the F-18A Aircraft?
2.	What military purpose will each aircraft perform and what aircraft will they replace?
March 5, 1979

3.	What effect, if any, will the flying range of each aircraft have on the continued use of CFB Chatham in New Brunswick?
4.	Is the government or the Department of National Defence considering contingency plans for the relocation of the Chatham Base for the final NFA selection and, if so, what alternate sites are being, or have been, considered?


Hon. Barney Danson (Minister of National Defence):: 1.
The range of an aircraft is dependent on a large number of variables which must be precisely defined before any comparison can be made. However, in general terms, the combat radius of action of the F-16 and F-18A is as low as 300 nautical miles and up to more than 2,500 nautical miles for ferry purposes depending on air speed, altitude and configuration such as weapons load and external fuel tanks.
2.	The new fighter aircraft will replace the CF-lOls based in Canada and the CF-104s based in Europe. The various missions of the new fighter aircraft are air defence, defensive counter air, close air support, interdiction, offensive counter air and anti-maritime surface.
3.	Not applicable.
4.	DND is currently conducting studies to establish which deployment bases are best suited strategically for the new fighter aircraft.


Mr. Stevens: 1.	For each fiscal year (a) 1977 (b) 1978, what was the total revenue and net earnings or deficits for the Dominion Coal Board?
2.	For each year, what was the total (a) of direct or indirect subsidies or other benefits conferred by the government on the Corporation (b) of loans, advances or guarantees extended by the government to the Corporation (c) investment by the government in the Corporation both before and after any write off?


Mr. Pierre Bussieres (Parliamentary Secretary to Minister of Energy, Mines and Resources and Minister of State for Science and Technology):: The Department of Energy, Mines and Resources reports as follows: 1 and 2. The dominion coal board was dissolved by the Dominion Coal Board Dissolution Act which was proclaimed in force on May 1, 1970.


Mr. Leggatt: 1.	What are the estimated ranges of the CF-16 and the CF18A, the two Fighter aircraft on the DND shortlist?
2.	Will their ranges be affected by their proposed roles, that is, will they have different ranges in North America as opposed to Europe and, if so, what will be the ranges?
3.	Will new landing strips have to be constructed in the Canadian North in order to accommodate the aircraft?


Barnett Jerome Danson: 1.
See answer to question No. 885 answered this day.
2.	Yes. In the air-to-air role the range for both fighters in North America or Europe will be approximately 700 nautical miles. In the low level air-to-surface role in Europe the range will be approximately 300 nautical miles.
3.	No.
Housing


Mr. Shymko: For each year since 1968, what amount in estate moneys were transferred from (a) Canada to surviving relatives in the U.S.S.R. (b) the U.S.S.R. to surviving relatives in Canada?


Yvon Pinard: This is a provincial matter as the provinces alone have jurisdiction over the transferral of estate moneys.


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


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Friday, March 2, consideration of the motion of Mr. Ouellet that Bill C-29, to amend the National Housing Act and the Central Mortgage and Housing Corporation Act and to make other related amendments, be read the second time and referred to the Standing Committee on Health, Welfare and Social Affairs.
Frank Oberle: Mr. Speaker, as is the case on every occasion when we discuss the topic of housing in the House, I take the opportunity to remind my friends and colleagues of some of the difficulties and problems experienced by a significant segment of our society in respect of the critical shortage of living space. It is left to me in this debate to articulate these problems, which affect about 20 per cent of our population, and particularly that part of our population which lives in rural areas and which is of native ancestry.
It appears to me that the more changes and amendments this government makes, the more things stay the same. Almost every day we are treated to fundamental changes in the orientation of government departments. The UIC and manpower problems have been reoriented from what they were in 1968 when the present government took over. Last week we had a reorganization bill before the House which reorganized the Department of the Environment, taking away from it the Department of Fisheries and establishing it as an autonomous agency. Today we heard the minister say that we have reorganized the food monitoring agency from what it was three or four years ago-twice during that time the government has developed a new awareness of this crucial problem-and now we are treated to yet another agency. In housing, the more improvements this government claims the worse things seem to get.

March 5, 1979
Housing
My colleagues have been treating the House to horror stories of government programs which have failed, of hardship and deprivation suffered by Canadians, not just those in the poorer income categories but also those in the middle income category, people who are stuck with AHOP housing and who thought at one time that they were entitled, as are most other Canadians, by virtue of owning their house, to having a cushion against inflation. These stories are on the record and they should be recommended reading not just to our colleagues in the House but to all Canadians.
I have listened carefully and attentively to the points the Minister of State for Urban Affairs (Mr. Ouellet) made in his opening remarks. He has not been present in the debate in the House since that time and he is not in the House today. I suppose he is out conducting another Gallup poll in respect of housing, because the statistics he laid before the House are mainly those that were given to him as a result of a Gallup poll.
The minister said that there is a new awareness in the government of the crucial problems facing us in respect of housing. He said, for instance, that the provisions in this bill address specifically our great national objectives, the first of which is probably the most important, namely, the considerable increase in the number of housing units which meet the needs of Canadians with lowest incomes. Further on in his speech he identified that need as being an immediate need for 30,000 housing units in one year. He said further:
Our present housing programs, which are undertaken in conjunction with the provincial governments, hardly provide at the moment 19,000 units a year; it is not enough to meet the needs of the country. It is obvious that we must build each year a greater number of units for old and low income people.
I am almost compelled to accuse the minister of misleading the House. It was nonsense for the minister to say that 19,000 new housing units for low income Canadians have been built. Further, the minister indicated that during the last four years housing starts in Canada reached an average of nearly 250,000 units, and that that is not sufficient. He described in glowing terms the government's record in its past performance. One almost began to wonder, as the minister was speaking both inside and outside the House, what the reason is for another change in housing policy and another reorientation when things apparently were going so well.
It will be left to me to talk about rural and native housing. The program initiated in 1974 has been a total failure; there are no other words to describe it. In his speech the minister said that there were certain obstacles to the program and that he is confident these obstacles have been removed. Again that is nonsense. The minister is attempting to shift an even greater burden to the provinces. He is including the municipalities of the country in the housing scheme. The minister is creating more obstacles than he is removing. His commitment to 30,000 new housing units for low income Canadians in one year is nothing but a dream which exists in the minister's mind. It will never be fulfilled.
It is my intention to lay before the House the statistics regarding the government's real performance in the last five years. The intention is to shift a partial burden of the financing of low income housing schemes to the provinces in addition to a 2 per cent interest rate. There have been consultations with the provinces, but there is no evidence of clear commitments from the provinces or the municipalities that they have greater faith in the government's new orientation program than the last one.
Perhaps it can reasonably be asked why the government should play a role in this important area. Surely we on this side of the House do not have to demonstrate the need for government intervention in this area. Hon. members on all sides of the House agree that government has a very real role to play. Perhaps government members have been more skilful in articulating this need, even though nothing is being done about it. The concept of subsidized housing for low income Canadians cannot be argued. Housing is a very significant component of a social contract. Adequate and comfortable housing and the right to privacy are very significant components in the social evolution of our citizens. Of course, my party differs in its approach to the type of people who should achieve their right to proper and adequate living, those people with steady incomes and those with lower ones.
We have spoken about the deductibility of the interest portion of the monthly mortgage payment for tax purposes and a portion of the property tax which individuals pay. The government claims such a scheme does not work. There are many other schemes, all of which have been successful in other parts of the world, particularly in countries the government uses for comparison purposes in areas other than housing.
For instance, there is a scheme whereby individuals are encouraged to invest through a mortgage exchange corporation. That is something which should have been passed in the House years ago. It has been sitting on the shelf somewhere and has never been proclaimed. The mortgage exchange corporation would allow individuals and investors to invest in the housing field with the concession of not having to pay income tax on certain earnings from such investments. The scheme works well in the United States. It has kept the United States interest rates 4 per cent to 5 per cent below our own. Whatever scheme is used or decided upon, it must be one which functions. It must not be one which sees the minister getting up in the House every two years and proclaiming in glowing terms that the government finally has seen the light and that there is a commitment to do something about it, without tangible evidence that such a commitment can be fulfilled.
There is no difficulty in determining how people in the very poor categories should be helped. Surely the element exists in this country, as it does in others, which says: "Why should I help him? He has lived on welfare all his life. He is drawing unemployment insurance and is a burden on society. Why must I now build him a house?" One must ask what fault it is of the small child or younger Canadians who live in substandard dwellings because their parents have not learned to manage well. What fault is it of theirs? If we do not help

March 5, 1979

them, and if we do not make a commitment to alleviate their problems, they will follow their parents' footsteps and the problem will be compounded many times over in the next decades.
After 11 years of its just society, the government claims a monopoly on social conscience. I should like to give hon. members of the House an assessment of the government's record in this important area. In order to identify the people of which I am speaking, I should like to give a few statistics as to the seriousness of the social deprivation 20 per cent of our fellow citizens face.
Approximately 20 per cent of the poor in our country, or the lowest 20 per cent of income earners, have seen their family incomes decline by 7 per cent since the just society was declared. I am not drawing these statistics out of the air; they come from the government's record. That 20 per cent at the lower end of the economic scale earns 4.4 per cent of the nation's income. Incidentally the upper 20 per cent, the highest 20 per cent of income earners, earns 42.2 per cent of the nation's income. Be it in industrial negotiations or be it in the government's commitments to its public servants and social contracts, its commitments always are based upon percentages. If a family lives on an income of $8,000 a year and if the increment is to be 5 per cent, the family can expect its income to increase by $400. If we talk about the persons who earn $40,000 annually, their increments, of course, would be five times higher, or $2,000 a year. Incidentally, there are many persons in Canada who earn $40,000, most of them being in the public service. Both these groups of people buy their bread, lettuce, meat and steaks from the same stores. Perhaps I should not refer to steaks because the first group of which I speak are not buying steaks. Both these groups are buying their essential commodities and services from the same stores but their incomes are 500 per cent apart.
The rich in the country have been getting richer; the poor have been getting poorer. The inner circle of the just society is getting smaller and smaller all the time. Also the living space of that important sector of society, that 20 per cent of low income Canadians, is getting smaller.
Let me demonstrate how serious this problem is. I draw attention to a press report in the Toronto Sun. I am sure hon. members will say immediately that it is a scandalous report, a scandalous paper. But let me put on record what it says in the Toronto Sun and set it against a press release I received in my office today from the Minister of Indian Affairs and Northern Development (Mr. Faulkner). I quote the Sun:
Edmonton, Alberta:
A doctor in the small town of High Level has suggested that bad housing conditions may be a contributing factor in the deaths of three Indian babies in the remote village of Assumption from an ailment similar to the so-called "Naples Dark Disease".
Dr. Doreen Mitchinson who makes weekly visits to the nursing station in Assumption, said housing conditions there are "far from ideal."
Housing
What an understatement that is!
The houses are mostly wooden and they can be very drafty with just a wood-burning stove to heat them.
"Sometimes there can be 10 to 13 people living in a one-room house with two or three babies under a year under the same roof. It predisposes the children to more illness."
There was not a great outcry when the electronic media exposed the story briefly one night but it drew my attention and I did some research in the press. The only mention I could find was in the Toronto Sun. It picked up this horror story comparing housing conditions in our country with the poorest slums in Italy. What an indictment! Some people were upset; some people were ashamed. The minister sent us a press release and I want to put a portion of it on record. He said:
There is no question that health problems such as respiratory disease are related to poor housing and overcrowding.
The communities where these deaths have occurred are all too symptomatic of reserve housing conditions in general, but particularly in remote areas.
Unfortunately, the Indian housing program, like virtually all other government programs, is under severe financial pressure. I do, however, intend to review the situation to see what further action may be possible within limited resources.
The only word I know to describe that situation is "incredible". The minister is quoting need for restraint at a time when we are confronted with a further 8.9 per cent increase in projected spending for the coming year, at a time when we see no attempt being made to curb spending in the non-productive sectors of the economy, at a time when we see no curbing of the government's appetite to continue with its frivolous dream. It is left to me, as I say, to make the case for 20 per cent of Canadian citizens, the category which includes natives and non-status Indians. The government's record in this regard is one of negligence-one is tempted to say, of criminal negligence.
It is not that the government is unaware of the problem. In 1968, as I have mentioned, great pronouncements were made concerning commitments to establish equity and bring these Canadians into the mainstream of the national life. Task forces were set up and voluminous reports were issued. The Hellyer report is one example. The Rheaume commission also travelled across the country examining this problem. Mountains of submissions were received from native councils and people interested in social affairs, all saying that something needed to be done, that something needed to be done immediately, that something needed to be done desperately, to establish a greater degree of equity in this regard.
Then, of course, the government had its own reports. I have one here, a voluminous document containing some 62 pages and entitled "Revised Draft Program and Discussion Papers with regard to Housing Policy for Indians on Reserves". It is written in the usual bureaucratic jargon. I don't know how many times this document has been revised; it was probably drawn up in the 1930s and revised every time a minister felt the need for it or felt himself under pressure to make a statement. I invite hon. members to put themselves into the position of an Indian on an outlying reserve who is given this document, a document within which is locked the secret of
800S0-27

March 5, 1979
Housing
how he can achieve the kind of housing which 60 per cent of all Canadians take for granted and accept as a right, not just as a privilege. The whole of this document should really be put on record because it is a typical example of bureaucratic nonsense. Let me quote just a couple of paragraphs, however:
The Band Councils, through a housing management authority to be established for each band, would prepare project submissions outlining the housing program requirements, type of houses, costs, funding mechanisms and proposed maintenance procedures.
What a bunch of nonsense! Imagine the reaction to all this of members of a remote band isolated from the mainstream of Canadian life. Most of those living on the reserves are without radio and television; they have no access to newspapers, and not many of the older people can read newspapers anyway.
Another paragraph in this document has to do with training for the housing management authority which it is proposed to establish. The department would generously assume the responsibility for training representatives from the housing management authority in the "proper utilization of federal funding programs, the development of labour training programs and encouraging adequate design standards and proper maintenance procedures." A planning cycle is outlined. Can you imagine that, Mr. Speaker-a five-year planning cycle involving band councils submitting annual forecasts for three years as the basis for the preparation of three-year forecasts, two-year estimates and one-year budgets? Has this government ever shown any evidence of ability to forecast for even two months ahead with any accuracy? Yet these Indians are expected to forecast their needs for five years ahead. Here is another paragraph:
In terms of tenure, it is suggested that the Band Councils, through the housing management authority, hold title of the housing obtained through the non-profit housing program and that this authority be charged with managing the housing on an ongoing basis and seeing to the collection of rents/loan repayments.
When we deal with Indian housing, we deal with a very serious problem which cannot be addressed by contemporary bureaucrats. What we are dealing with is a cultural gap between the manner in which we in the House and in the country see ourselves helping our constituents and the manner in which the native community in our country hopes to achieve equity. This paper deals only with the problems of status Indians on the reserves. There are a number of most peculiar components to the problem which have confounded the social engineers and the public bureaucrats in trying to solve it.
Native culture is not taught in our schools or learning institutions where, for example, Mr. Teron or our Prime Minister (Mr. Trudeau) received their education. The schools do not teach students about the cultures of the native people in our country. There is also the problem of the concept of communal living which says it is not important to own your own home. Even if it were important, so long as the Ministry of Indian Affairs and Northern Development retains ownership of the house once it is built, how can we ask the Indian person to make payments on this house and investments for the

future if it is not his in the first place? The house belongs to the ministry of Indian affairs or the governor in council.
In one sense this paper says that the band should have the right to own the house and property, but it also describes the needs of the individual with regard to ownership. What a contradiction! There is the whole problem of the high cost of servicing, utilities, insulation and building in the north and rural areas. We were told last year, and it is reiterated in this paper, that the subsidy of $10,000 which the department of Indian affairs offered to natives on reserves would be increased to $12,000 for status Indians who wished to build near urban areas, and to $18,000 for those who wished to build in remote areas. I am sure that anybody who has looked at the housing market over the last two or three years in this regard will not find it difficult to understand that this is just so much nonsense, and that with $18,000 one could not even cover the cost of putting the four walls up never mind the roof, furnace or water taps.
There are examples throughout the country of attempts to provide the most primitive shelter for people on Indian reserves as a result of trying to work within the constraints of these financial guidelines. The department of Indian affairs said last year with regard to the rural situation that, in addition to the $18,000, CMHC would be required to contribute another $28 million, Manpower to contribute another $48 million and other departments to contribute another $19 million over a five-year period to alleviate this crisis in the area of reserve housing. My friend and colleague, the hon. member for Lambton-Kent (Mr. Holmes), will speak more specifically about reserve housing.
I would like to speak about the non-status situation and the rural situation which are as equally crucial and important. In 1971 the Prime Minister said that there is a clear commitment by the government to a scheme which would provide natives throughout the land, non-status Indians and, generally, people in rural areas with housing and that they should look at the right to own a home as an inalienable right in this country with the resources we have. I said earlier that the government has known of the problem. This is reflected in the Prime Minister's statement of 1971, but nothing has happened.
Another commitment was made-and I will not bother the House by going into the actual references in Hansard-in 1972.
Of course, it was in the early 1970s when the natives became organized and, out of sheer frustration, became militant. In an attempt to make their positions felt here in Ottawa they began to exercise some political muscle. Hon. members will recall that in September 1973 the message got across to the bureaucrats and the people in the policy planning group, and as a result a policy was actually developed. However, when it was shown to the Indians, hon. members will recall that one of the people who was charged with developing this policy and who had a clear mandate to negotiate with the native people was fired because he had discussed with them the intricacies of such a policy. This firing took place in spite of the fact that the minister had ordered the individual to
March 5, 1979

make sure that whatever policy was advanced to the cabinet had the approval and acceptance of the native community.
In those years a whole new science developed within the bureaucracy. The conventional manner of giving these people a snow job did not work as well because they began to take the ministers at their word, and every time they or the Prime Minister or one of the senior bureaucrats made a new commitment, the native people expected it to be fulfilled. Of course, when that did not happen the native people became very concerned, outspoken and militant.
Then there was the new approach-which really is not new at all but which certainly came in handy at the time-of dividing and conquering, dividing the status native community from the non-status native community, the urban native community from the rural native community, and so on. Eventually, however, a decision had to be made, and it came in March, 1974, precisely five years ago when the policy for rural native housing was announced.
This year is the fifth anniversary of this policy, and it is in this climate that I have the opportunity to speak on this matter again. Let me put on the record the manner in which the policy is described in the manual under the heading "Rural and Native Housing":
CMHCs rural and native housing policy, announced in March, 1974, attempts to marshall all of the resources of the NHA for the benefit of rural and native people and, specifically, within the next five years, to acquire or build 50,000 housing units for these people and to rehabilitate an equal number.
Over a five-year period there would be 100,000 new housing units. The manual goes on to say:
The policy is to encourage the people concerned to plan, build and manage their own projects as much as possible, so that they will acquire not only housing but new skills and economic security as well. The resources of many other federal programs are channelled to rural and native people through an interdepartmental committee, of which CMHC is chairman. At the provincial level, federal-provincial rural and native housing committees perform a similar function.
One innovative aspect of the policy is to allow rural and native people to buy their homes with monthly payments related to their incomes, on a scale similar to that used to calculate rents in public housing projects.
The natives had asked for 30,000 new homes but the minister, not to be outdone, said their needs were for 50,000. That can well be demonstrated by all the reports I have enumerated, such as the Hellyer report and the Rheaume report.
Let me deal briefly with the record of this policy to build 50,000 homes over a five-year period and to rehabilitate another 50,000. In 1975, after the first year, I asked the minister how many homes had been built. The minister had forgotten there was such a policy but he checked with his officials and two or three days later said 24 of the 50,000 homes had been built. They were all in my constituency. It was a project I demonstrated in my home town, because we have to start somewhere, Mr. Speaker. A year later I asked the question again. At that time, 300 houses had been built.
When I was preparing my remarks for today. I telephoned CMHC to see how the policy had performed. The information
Housing
service did not know of its existence. Apparently the minister's office was alerted and a directive sent to the people in charge of it to give me whatever information I wanted. I was told that 31,144 houses had been built over the five-year period. That was a source of comfort to me, as I had not checked how it was going over the last few months.
I asked where the houses had been built. My province of British Columbia was mentioned and the province of Ontario. I asked how many new houses in total had been built and was told that the 50,000 houses were a combination of new and rehabilitated houses. I reminded them that the program was to build 50,000 new houses and rehabilitate the same number. I read the minister's press relase to them, I read the minister's speech in the House to them and an excerpt from the government's housing policy. It was admitted that all this was very true and they offered to give me the figures on the new houses actually built. In the five-year period 7,753 houses had been built and 23,391 rehabilitated.
I shall give the figures for each province in order to demonstrate the kind of response received for his frivolous dream from the provinces. In Newfoundland, 1,824 houses were built; in Nova Scotia, 549; Prince Edward Island, 45; New Brunswick, 450; and Ontario, 834. The program works well in Ontario and Newfoundland because there are groups organized by natives to provide a delivery system. In Manitoba, 1,266 houses were built and in Saskatchewan, 1,549 were built. In Alberta, the province with the housing problem described in the story in the Toronto Sun, 405 houses were built; and in British Columbia, 838. There was no requirement for the government to make any deal in the two territories. Surely we cannot abrogate our responsibilities for the Yukon and the Northwest Territories. Only 34 of the 50,000 houses were built in the Northwest Territories. In the Yukon it was zero; no new houses under this program for the Yukon.
I have omitted the province of Quebec, where the minister is the champion of federalism, the champion of all that is good and desirable in a just society.


The Acting Speaker (Mr. Turner):: Order, please. I regret to inform the hon. member that his allotted time has expired. He may continue with the unanimous consent of the House. Does the hon. member have unanimous consent?


Some hon. Members:: No.


Hon. James Hugh Faulkner (Minister of Indian Affairs and Northern Development):: Mr. Speaker, my intervention will be relatively brief. I want to speak about two aspects of the bill, the one that relates to the more effective delivery of housing to Indian reserves, and the other that deals with the conservation of heritage buildings. They seem at first blush to be rather disparate elements, but one stems from my responsibility as Minister of Indian Affairs and Northern Development and the other from my mandate in the parks program for heritage preservation. There are aspects of the bill which will be helpful in dealing with both areas and I should like to draw the

March 5, 1979
Housing
attention of the House to those amendments which I think will help address the problem that has been under discussion.
If we look at the problems confronting the department in coming to grips with the very serious housing conditions on Indian reservations, I think we all share the view that a great deal has to be done. The hon. member who just preceded me, in a fashion which I think is rather characteristic of him, pointed out the problems, discussed some of the difficulties and dwelt on some of the shortcomings, but failed to mention some of the improvements we have made in respect of housing on the reserves in the last ten years. I do not think anyone who is anxious to be fair would deny there has been substantial progress. What has to be admitted is that there are still outstanding difficulties facing the department in trying to address the problem of Indian housing.
I think it is important to recognize that in the past ten years we have built approximately 10,800 houses on Indian reserves. In 1973-74, our rate of new house construction was approximately 2,000 per year, but as a result of a decision taken in cabinet in August, 1977, the rate was increased to about 2,400 new houses per year. At the same time, some existing 3,000 houses on Indian reserves are currently being renovated each year.
That is an improvement over what was being done. Although hon. members opposite tend to dissociate themselves from the past, they cannot avoid the reality that they were the government of this country between 1957 and 1963. They were not great years, Mr. Speaker, but the point is that they also had a chance to address the question of Indian housing. They also had a chance at that point to address the question of health services on reserves. I would ask any of them, particularly the hon. member for Prince George-Peace River (Mr. Oberle), to compare the rate of new housing in those years, the rate of new infrastructure in terms of water supply and health delivery services in those years, with what has been done in recent years. I agree with the hon. member that the task is still in front of us and, if anything, is becoming more difficult to cope with.
The housing needs analysis which was effective in December, 1977, indicated there is still a need over the next five years for approximately 22,500 new homes and the rehabilitation of some 30,000 existing homes on Indian reserves across Canada. There is no question that new construction and renovation is badly needed to reduce overcrowding, to replace substandard housing, and to provide for newly formed families. There is equally no question in my mind that the failure of governments, and-let us be realistic-the failure of this parliament, to find sufficient sums to meet this problem has contributed to the conditions which the hon. member I think rightly described. Maybe the tragedy he referred to of those Indian children will quicken the consciences of members in this House on all sides to recognize that there is more to be done in these areas affecting the Indian people.

I am dealing specifically with the status Indians. The hon. member went on to discuss the Metis and non-status Indians, and that is a question we can probably discuss in committee. The fact is there have been some achievements; there is no question about that. In recent years particularly there have been some solid achievements. The task is still there and it is an immense one. In my rough estimate, if we would try to catch up to that backlog, say over a period of five years, we are looking at an expenditure of something like $400 million. This is just to try to deal with the housing problem alone on the reserves. The present rate of expenditure is something like $195 million. There is a question of financing that is directly involved, but there is also a question of will and I think to the extent this chamber is engaged in a debate about this, there seems to be concern on both sides of the House that we address this question more forcibly. Hopefully when we get to committee we will be able to generate a little head of steam which in turn will lead to some money, increased appropriations, to deal with this very important problem.
Let me point out that Bill C-29 which is before us does help deal with the problem. I just want to go over the reason why. One of the main financing questions has been to supplement my department's $12,000 capital housing subsidy with programs from other federal departments. I want to tell the House today that after some discussions I think it is fair to say that we are in the final stages of developing a formula for using LEAP funds from CEIC, in a manner that coincides with the summer construction season. This has been a source of difficulty with the Indian people over the past two or three years. I think we are fairly close to an agreement that would allow these Canada Works funds to come in at the beginning of the season to maximize the construction period during the summer months.
Another important mechanism for financing Indian housing and for narrowing the gap between a decent house and what my department's housing subsidy can provide is through the provisions of the National Housing Act and its delivery agent, Central Mortgage and Housing Corporation. There have been and still are difficulties in applying the NHA to the particular circumstances of Indian reserves. However, improvements are being made, in particular some of the amendments proposed in Bill C-29.
The most important feature of the proposed amendments to the Indian people is the non-profit housing program, which is designed to increase the supply of low rent housing. This program enables non-profit groups and co-op groups, in this case Indian chiefs and councils, to develop the most appropriate form of housing at minimum cost to low and moderate income families and individuals. It is obviously potentially quite useful in the reserve situation since the majority of Indian people are in low and moderate income groups.
Many bands have been reluctant to use CMHC loans because of the requirement to incorporate. They felt that such incorporation would affect their Indian status and put reserve land in jeopardy. Amendments to section 15(1) remove the
March 5, 1979

major block to the utilization of CMHC programs in response to the particular concern of the Indian people which I have mentioned. As a result of amendments to section 15(1), Indians will be able to obtain all the benefits of non-profit housing without the necessity of having to legally incorporate as nonprofit organizations.
How the non-profit housing program works is that it provides a mechanism for obtaining capital funds for bands to build houses and rent them to occupants wishing to supplement my department's $12,000 housing subsidy. The capital funds in this case come from CMHC, but not, until passage of this bill, from approved lenders, which is the important addition. These lenders normally require some form of mortgage for their funds. Following the passage of Bill C-29 the approved lenders will be able to make loans to Indians for housing on reserves without having to take mortgages on reserve property. My guarantee, as Minister of Indian Affairs and Northern Development, of repayment of the loan in case of default will be the security needed for such loans.
With respect to the non-profit housing program, there is already provision in the National Housing Act for interest reduction. Through an operating agreement with the chief and band council the interest rate on these loans can be as low as 1 per cent or 2 per cent. Thus, the payment schedule for the occupant to the band is only a modest amount. This bill should ease the problems that bands have in financing housing in this particular way.
Besides the non-profit housing improvements, the amendments also affect the application of RRAP, the residential rehabilitation assistance program. This program is designed to upgrade the existing housing stock in low income areas through a combination of low interest and forgivable loans.
Under a revised section 34.1 the amendments expand the scope of RRAP to cover all Indian reserves. Henceforth all Indian bands will qualify for assistance, irrespective of the location of the Indian reserves. Formerly, it was a requirement for participation in RRAP that Indian reserves be located in areas which provinces designated as high unemployment. As is frequently the case, Indian reserves with high rates of unemployment could be located in areas of otherwise high employment. With the passage of Bill C-29 this will no longer make such affected reserves ineligible for RRAP.
Indian leaders in Canada have been consistent in their representations as to how we must address the housing problem on reserves. They are saying that the authority and responsibility for delivering a housing program must be at the level of the Indian band council. Members here today will recall earlier remarks I have made in this House endorsing the concepts of Indian control and Indian self-determination. Our housing program direction is aimed very much along the line of this philosophy, although progress is often agonizingly slow.
The amendments concerning non-profit housing are designed to further the objective of placing housing responsibility at the band level. At the same time the department is setting up regional Indian housing councils to help monitor and supervise the implementation of the housing program.
Housing
Indian people also say to me that my department should be responsible for co-ordinating financing and programming sources for Indian bands or groups of bands. My participation in this debate and the provisions to tailor the NHA to reserve circumstances are a reflection of my commitment to respond to this co-ordinating responsibility.
Indian people are arguing that there should be a strong association between land tenure and the trust responsibility of the minister of Indian affairs. I believe in this context that Indian bands need to be able to develop mtchanisms for granting tenure without jeopardizing the status of reserve lands. As I stated earlier, this bill will provide greater flexibility in this respect.
Finally, Mr. Speaker, we all have an obligation to continue to work with the Indian people to try to solve the problem of Indian housing, and to work with the Indian people in a meaningful way, because in the final analysis they may be and probably are the best judges of how housing problems on the reserves should be handled. I happen to believe that the bill before us in that respect is a contribution to the objectives I and the Indian people have, and of course I welcome them.
I would like for a moment, if I may, to look at the bill in terms of my mandate as the minister responsible for Parks Canada, particularly the national program of historic conservation and commemoration. You may not know this, Mr. Speaker, but there are some one million buildings in Canada which were constructed prior to 1920. These buildings are a highly valuable resource in terms of capital investment, the labour and culture they represent, yet many of these are in a poor state of repair and are often threatened with demolition.
The loss of historic properties and the destruction of neighbourhoods and streetscapes is a continuing drain on our national built heritage. CMHC is being most helpful in encouraging recycling, renovation and heritage preservation in Canada. There is an emerging policy thrust in heritage, and my colleague referred to existing practices in a speech to HUDAC last week.
This bill should complement these CMHC practices in the following ways. First, provision is made in the bill for obtaining funds for non-residential heritage property conversions. This means that in addition to financing the renovation of existing rental properties, the financing will be extended to cover, for example, the conversion of old warehouses to apartments where heritage improvements are being undertaken.
Second, through the RRAP program the bill will help heritage renovators by increasing the attractiveness of heritage projects to private lenders. The bill provides for insurance of privately financed residential rehabilitation under RRAP. This provision replaces a direct loan program by CMHC. The advantage of it is that in future, when refinancing of mortgages is permitted by CMHC, heritage renovators will be able to refinance multiple mortgages to obtain a single mortgage at first mortgage rates.

March 5, 1979
Housing
Third, the bill facilitates non-profit housing co-operatives by relaxing the membership requirements from the stipulation of 80 per cent to 50 per cent of members or shareholders also being residents. In conjunction with the introduction of this bill, CMEIC has been encouraging non-profit co-operatives to enter into the field of heritage restoration through the RRAP program. Thus financing will be made somewhat easier for persons wishing to recycle older buildings. Bill C-29 helps to meet the widespread concerns Canadians have for preserving our built heritage.
Other initiatives have been taken recently. The week before last, for instance, I set up a study group of senior officials from the Departments of Finance, Public Works, Secretary of State, CMHC, my own department and Heritage Canada to consider proposals and present within a month recommendations for government action to help save our built heritage. They will be focusing on tax policy, and in particular on possible ways to neutralize the tax incentives to demolish buildings. Tax laws affecting demolition are strongly believed to have unfortunate consequences for heritage conservation. This theme became very clear in the meeting the cabinet recently held in Toronto where we received a submission from Heritage Canada. That was the brunt of their presentation to cabinet.
This government feels that it is important to encourage the recycling of the built structures in this country. It is a matter of avoiding the irreparable mistake of wasting this important resource. It is clearly a waste of material, workmanship and energy to destroy buildings. The buildings we live in and work in are a vital and tangible part of our heritage.
Heritage preservation makes economic sense as well. It usually means renovation, and renovation is particularly labour intensive. Studies have tended to show more jobs created through investment in renovation than an equivalent amount in new construction.
At the beginning of this month I met with groups of professionals and businessmen and with representatives from municipal and provincial governments to discuss actions that the government and the private sector can take. There was strong support for the initiatives the government is now discussing. As a result, there is a concerted effort between the government and concerned elements of the private sector to consider ways to stimulate and provide incentives for investment in heritage structures. This group also stressed the importance of the role of CMHC. The bill under consideration at the present time is another measure to increase the participation of the private sector. The private sector is concerned about the adaptive re-use of buildings and is ready to act. This government is responding. This bill is an important part of that response and a demonstration that the government is determined to take action.


Mr. Bill Clarke (Vancouver Quadra):: Mr. Speaker, in rising to contribute to the debate on Bill C-29, I cannot recall how many times in the six and a half years that I have been here that we have been asked to contribute to a debate on the housing policies of this government.

I recall the first time I spoke in a debate such as this in 1973. My advice to the government then to solve the housing problem in Canada was for the government to get out of the housing field. The minister of the day, Ron Basford, now a private citizen living in Vancouver, followed my advice to the extend that he got out. First he got out of the housing and urban affairs ministry. A few years later he got out of the justice ministry, and not too many weeks ago Mr. Basford got out of this parliament.
There are quite a few members opposite who should follow my advice and, along with the government, get out of the housing field. In fact, they should get out altogether. Maybe at the time of the next election the electors will take care of getting a few members opposite out of this parliament. They can follow the example of their former colleague, Mr. Basford, and take up private life wherever they happen to come from.
It is now the intention of this government to do something drastic with the Ministry of State for Urban Affairs. Maybe the whole thing will be wound up. That would be good for the Government of Canada. It would also be good for the people of Canada.
Another time I contributed to a debate on the housing policy of this government was in 1975. I want to quote briefly from Hansard for January 27, 1975, page 2631, a speech I made at that time:
I have mentioned the basic problem in speeches before today, namely, government interference in the housing industry. I have cited examples of high-cost government housing, the need for money in lieu of shelter so that the individual or family can be free to choose their home. I quote from an editorial which appeared last September in the Vancouver Province-.
"-our housing difficulties, particularly in the rental field, compose a classic case of problem creation by government.
It continued:
We did not begin to experience real rental shortages in this country until the federal government removed the tax incentives that channelled a lot of private money into rental accommodation."
They have not learned. They have not done anything to reintroduce this incentive on a permanent basis. As a result, there is continuing confusion in the housing field in Canada today. I want to read another short excerpt from that speech:
Let me say just a word or two about what the minister himself said. He is credited with saying that the intent of his bill is aimed at increasing the supply and holding down the cost of housing in the low and medium price range both for home ownership and for rental. He says that if we are really going to meet the demand, we must draw much more heavily on private capital. Of course, the minister cannot draw on that private capital by himself but needs the co-operation of his government. The government, in the past two successive budgets, has indicated it is not able or willing to control the economic situation in Canada so that private capital will be attracted to those areas to which certain government ministers wish it attracted.
No action has been taken by the government to try to correct the situation which existed four years ago. Billions of dollars have been diverted to the United States. Expertise in the housing industry has gone to the United States. We see the sorry spectacle of Canadian expertise and Canadian capital providing housing for Americans. The government does not ask itself why that happens. It keeps coming up with more and
March 5, 1979

more programs, which reminds me of the old saying that we certainly have too much government in Canada, but thank goodness we do not have as much as we are paying for. We need only look at the publications of the Ministry of State for Urban Affairs to realize where we are.
I have with me two booklets, one put out by the Central Mortgage and Housing Corporation and one by the Ministry of State for Urban Affairs. The publication put out by CMHC is a list of its publications, and it runs to 11 pages. The companion booklet put out by the Ministry of State for Urban Affairs contains a list of its publications, and that booklet runs to over 25 pages. It is clear that we have too much government, but the government opposite just continues with its policies and seems to think everyone likes them.
I think we should look for a moment at where we are now, six years after I first made a speech about housing in this House. We have the very same problems we had six years ago. It is true that some programs have been introduced. The government has given us an alphabet soup of programs. We have CHIP, we had DIP, and we have NIP. We have AHOP, ARP and RRAP, not to mention GPM, the graduated payment mortgage, about which I will say a word a little later.
In the last six years we have seen a dramatic increase in the level of interest rates for mortgages. However, people who are in the market for mortgages can be somewhat thankful now that there is so much money in Canada looking for something in which to invest.
Mortgages are actually available now at rates lower than bank loan rates. Mortgages are available at under 12 per cent in some instances, whereas the prime rate for bank loans is now 12 per cent. Higher interest rates, of course, magnified what was already the largest single component in the cost of a house over the years, but higher interest rates are understandable, expected and, in fact, necessary in order to attract capital for any kind of investment. If we reflect on the rates of true return some decades ago, we can see that capital was invested for a return of somewhere in the neighbourhood of 3 per cent. In the past decade or so inflation rates have ranged from between 7 per cent and, I suppose, 11 per cent. One naturally has to have an adjustment in the rate of return on capital; otherwise there will not be any capital available at all.
The high interest rates we have now are a direct result of the policies of the government opposite. The government has a lack of ability or willingness-I do not care which-to control inflation, the great robber. Why does the government love inflation so? The government loves inflation so much it is married to it. I do now know if we can tell exactly why, but one reason might be that inflation gives the government an opportunity to steal from the taxpayers of Canada. Inflation allows the government to reduce the value of the debt it must pay in the future, and this, of course, is at the expense of those who can least afford it, those on fixed incomes.
We might wonder whether it is really true that the government relies on inflation or loves inflation, but let us examine two of its current housing programs and see how they require continuing inflation in order to succeed. One of these programs
Housing
is the assisted rental program, ARP. After the government destroyed the incentive aspect of investment in rental housing it found, as it was told it would, that the supply of rental housing dried up. The government's solution was the assisted rental program. The purpose of that program is simply to reduce the economic rent for a rental property to what is called market rent. The government makes up the difference to the landlord. However, that money is not just given to the landlord. Even this government would not want to do that, so the money is lent to the landlord, albeit interest-free for the first ten years. Then the landlord must start repaying. If we do not have continuing inflation, the mounting debt created by the advances to the landlord in the early stages of the assisted rental program loan will bankrupt the landlord. I do not think the government wants all those landlords to go bankrupt.
I do not think the government realized what it was doing, but that clearly is the effect of the assisted rental program. It needs to be re-examined by the government and particularly by the Minister of Finance (Mr. Chretien) so that he can see the danger of these policies for the Canadian economy and for investors in Canada.
Let us consider the graduated payment mortgage, wherein payments by the home owner or purchaser for the first few years are at a lower than normal level. After a stated period, which is to be flexible-it might be three years, five years or more-the amount of the payments jumps up all of a sudden, presumably because the purchaser is in a better position to pay a larger payment later on. The problem this creates is that before the point at which the mortgage payments increase, the excess interest which is not covered by the initial payments has eaten into the home owner's equity in the property. Unless we have continuing inflation, home owners would then be in a loss position on the investment. If we do not have continuing inflation, we will have the situation we already have at some AHOP projects in which home owners simply have no equity. They treat what they have paid as rent and walk away, leaving communities in some cases to become ghost towns.
The other flaw in the graduated payment mortgage idea is that while the home owner may be in a better position and have a higher income five years down the road, all his other costs will have gone up too, and unless he is able to keep ahead of inflation by getting promotions and the like, he will not be any better able to pay higher mortgage payments then than he is now.
Having given a couple of examples of the government's apparent reliance upon continuing inflation, I want to say something about the effects of the inflation which the government has allowed to continue. We know that during this calendar year the national debt will rise above the $100 billion level. We are used to talking about billions, and perhaps $100 billion is a figure which some people can grasp. After all, it amounts to only two years' total expenditures of the Government of Canada. Let us put this into perspective. Let us divide that by the number of people. Let us get a per capita amount for that debt. That amount is about $4,300 per Canadian. Mr. Speaker, you and I may be able to handle our share, but what

March 5, 1979
Housing
about the family man who has four dependants? If we multiply his per capita share by five, will he be able to come up with his $22,000 share of that national debt? The answer, of course, is that he will not, unless it can be stretched over a large number of years.
In the meantime we are now faced with interest on the national debt of some $8 billion. Translated into the terms of the current budget, that is about 15 per cent of the total expenditures of the government of Canada this year; 15 per cent of $52 billion is about $8 billion which we owe in interest on the national debt. That does not say anything about raising a little extra capital to pay it off. Somebody has to pay that off. If the present government is not willing to, perhaps they will be looking toward another government which will at least get things turned around and going in the right direction. We cannot spend ourselves out of debt, any more than could New York City or any other city or province, or any more than can any other household or individual. After all, Mr. Speaker, the government is simply operating essential services in the name of you and me; at least that was the original idea. For them to go on this profligate spending spree is abominable.
What are the facts of the situation? Where are we now? We hear a lot about problems in the housing field, the housing shortage, and so on. There is no housing shortage in Canada today. In fact, on the new housing market there are some 70,000 unlived in and unsold houses. Vancancy rates in rental properties in many areas are soaring. It is true that you will not find them in the densely populated cities because that is the popular place to live, but I can take you to many areas in British Columbia, and probably in many other parts of Canada, where vacancy rates in rental properties are soaring. One has only to look at the Ottawa Citizen, which I did this weekend, to find eight pages of houses for sale in Ottawa. How can they say there is a housing shortage? We say there is not. What there is in Canada today is a shortage of money. People who want to buy houses do not have the money to buy them; or, translated in another way, we can say that the problem in Canada today is that there is an inadequate supply of affordable housing.
I have to refer to my 1975 speech again because, when I was reviewing some notes for today, I found a gem of information there.


Mr. Knowles (Winnipeg North Centre):: Has anybody else found it?


William Hillary (Bill) Clarke: I think my friend, the hon. member for Winnipeg North Centre (Mr. Knowles) will like this because I am calling on the Canadian Organization of Public Housing Tenants for support. It turns out that they realized the problems which this government has presented to them and wrote the following in their official newsletter "The Raised Roof', the first page of which is headlined "the problem is not really housing". In their lead editorial they said:

The group has tried to show members of government, housing corporations and authorities that the problem in housing is not really housing, but the entire economic question, of which housing is merely one part.
Of course, those people know better than anybody in the House, that the sure answer to the housing problem is adequate money. Anybody who has enough money can go and find himself a house anywhere he wants to live. So it is a shortage of affordable housing. It may be that in place of all the expensive government programs we have today we may end up having to look at some kind of assistance. As I said four years ago, I have often maintained that the needy should be given a housing allowance to do with as they wish. Not everyone wants to live the same way and not everyone wants to live where the government says they should, in so-called public housing. I will be speaking about the experience of our friends in the United States and the problem they have had with the bureaucracy, with the administering of these programs and with the acceptance of them.
I suppose we can expect that kind of talk from a government which has a Minister of Industry, Trade and Commerce (Mr. Horner) who says a home is a luxury and that his government wants to tax luxuries. They have shown their inability to gauge the needs of the industry through their tax policies. I am sorry the Minister of Finance has left the chamber because he might be interested in making a few changes on this score.


An hon. Member:: Here he is.


William Hillary (Bill) Clarke: The Minister of Finance has returned. He may want to consider some day the detrimental effect of some of his government policies on housing. I understand the ministers opposite seldom consult with each other, and on most days they do not even talk with each other, we are told. There is a situation in Canada today where the government says they are trying to encourage home ownership and encourage young people with young families to buy homes, and yet young people working together for their future are now taxed at the highest rate possible. There is no tax shelter they have been given to allow them to save their money to purchase a home.


Joseph Jacques Jean Chrétien: There are some.


William Hillary (Bill) Clarke: The minister is going to say there is RHOSP. All I can say is that the RHOSP with its $1,000 a year to a maximum of $10,000 was an absolute joke. Furthermore, it was not an incentive to buy a house because the only way one could benefit from RHOSP was to save money, not to buy a home. What kind of way is that to stimulate the economy? The hon. member for Hamilton West (Mr. Alexander) and I told the Minister of Finance at that time that the RHOSP was a crazy plan because what it would do was allow the hon. member for Hamilton West, for example-


Joseph Jacques Jean Chrétien: Balance budget.


William Hillary (Bill) Clarke: So balance budget is the name of this game now? The hon. member for Hamilton West would be allowed to collapse his registered home ownership savings plan and go out and buy furniture for his wife's house which she had
March 5, 1979

already owned for 20 years. What kind of a plan to encourage economic activity or to encourage housing is it? In the meantime, through inflation and higher costs of all sorts we now find that older Canadians are being taxed right out of their homes. They cannot afford to stay in their old homestead where they have lived for 30 years or more and where they want to stay.
1 have dealt with where we are now, with what the old problems were and what the problems are at present. Now perhaps we should take a look at the solution. I am happy to say that my leader has offered a solution. Some of the details of it are well known. Basically, it is an economic policy with housing overtones and with very definite social effects as well. It is recognized in North America generally, but in Canada as well, that home ownership is the dream of families. It is true that all families will not be able to have their dream; nevertheless, the government should not make it more difficult for Canadians to achieve their dream. So we on this side say that tax deductibility for mortgage interest and property taxes would aid Canadians who want to buy a home.


Joseph Jacques Jean Chrétien: That is not what you were saying two years ago in your riding.


William Hillary (Bill) Clarke: What we have now is a situation where young people are not encouraged to buy their homes, which means a drain on the housing market because there is not the activity necessary to contribute to the over-all economic well-being of the country.
Why is the government opposed to our proposal? The obvious reason is that the government did not think of it first or, if they thought of it first, they did not get around to acting on it, which may be more the truth. The Minister of Finance says it is a program for the rich. It is obvious that the rich do not care about a program such as this. The rich already own their own homes. If they are rich, either they are without mortgages or they have assets of sufficient size that they are able to arrange to have their mortgage interest deductible.
It is a long standing rule in our Canadian tax laws that any expense laid out to earn income is deductible. If a taxpayer borrows money for the purpose of earning income, such as buying bonds, stocks, a revenue-producing building or registered retirement savings plans, the interest paid by the taxpayer is deductible. But if he borrows money to buy a house, it is not deductible. It is so mixed up that even if a taxpayer sells his home, takes back a mortgage from the purchaser, then purchases another home and assumes a larger mortgage therefor, the poor taxpayer must include the interest income in his income for tax purposes, but he is not allowed to deduct the interest which he is paying because of receiving this interest.
Under Canadian tax laws it is very important to follow the line carefully and not be confused. One must take the correct step at the correct time. Otherwise, the minister's henchmen come along and say: "That is not what we meant; you must pay". I know it can be done. I am a chartered accountant. I
Housing
used to do some tax practice before I came here. Now I have so much to do here that I can hardly keep track of what is going on in the tax laws. But any Canadian taxpayer who has any amount of assets at all can deduct his home ownership interest under the present rules, with good tax advice.
The minister indicated that this is a program for the rich. If the rich can get around this and deduct their mortgage interest anyway, let us have a program for the poor. We should let the poor deduct their mortgage interest, too. Let us not restrict mortgage deductibility to the rich. In any event, the rich have their houses; they are not the ones we on this side worry about. The rich who own their houses are not about to remortgage them unless it is for business purposes. In any event, they can easily go to the bank with their clear title certificates and borrow money if the rates are more favourable. One can be sure they will. The plan which my leader has outlined carefully throughout the country has been extremely popular, and so it should be. Canadian taxpayers and residents realize there is something in it for everyone.


Joseph Jacques Jean Chrétien: Increasing the deficit.


William Hillary (Bill) Clarke: It will help young and old home owners and renters. It will help the young who are either just forming households or those who are now renting and want to become home owners. It will mean they will have the benefit of lower monthly payments than otherwise. The old home owners, the ones being forced out of their homes by the government's economic policies because the size of their pensions and savings are shrinking, will be given the right to deduct their property taxes. It will provide them with a savings and help them to stay in their houses. There is no reason for the old folks to be forced out of their houses by some uncaring government. It will help young renters because it will be easier for them to make the transition from rental to home ownership. The older people who are renters because of choice and want to live in situations other than single family homes will receive a benefit and encouragement to move to condominium type residences or to convert their properties if it can be done. Condominium type residences would provide them with the rights of home ownership and would allow them to deduct their property taxes and interest like everyone else.
The hon. member for Westmount (Mr. Johnston) participated in this debate on March 1. I should like to refer to some of his comments because he and I were members of the task force from this House which went to Washington. There were five members of the task force. We went to Washington to receive information on the United States experience with this type of program. The hon. member for Westmount started his comments by saying the following:
Mr. Speaker, my intervention in this debate will be quite limited.
I agree with him. His intervention was limited in content, but it was not limited in time. As nearly as I can calculate, he ended his contribution approximately 30 seconds before Your Honour would have risen to interrupt him because his 40-minute time limit had expired.
3818

March 5, 1979
Housing
The hon. member pointed out that this type of program should not be embodied into the tax system, that there should be different kinds of incentives to encourage people to pur' chase their own homes, something which could be put on one week and taken off another week. That is exactly the kind of tax policy which has destroyed the Canadian economy. No taxpayer has had the opportunity of a program being in place long enough to know whether he is coming or going when dealing with the government.
The hon. member referred to the severe consequences of withdrawing this program, if necessary for cyclical reasons. If the hon. member for Westmount were present in the chamber, I would ask him: "What about the old folks who are having their purchasing power withdrawn by the government's economic and inflationary policies?" Does the hon. member not think there is a severe consequence in withdrawing purchasing power year after year? Of course there is.
Also the hon. member for Westmount talked about using a tax credit instead of tax deductibility. We have come a long way since 1917 when we had our first income tax approximately 62 years ago, and people are finally accustomed to the idea of having something deductible from their incomes in arriving at taxable incomes. It is something which makes sense, and many things are deductible. Hon. members have only to look at their experience as politicians to realize how difficult it is for the average taxpayer to digest the tax credit concept. We have only to look at the difficulty in our constituencies of people understanding the effects of a tax credit when they give money to a political party. The hon. member for Westmount is a tax practitioner. For him to suggest something which would make the tax system more complicated rather than less complicated, I cannot understand.
Also the hon. member suggested that there should be tax cuts for all instead of tax deductibility for a few. Then we would have no way of telling whether the moneys left in the people's hands by way of tax cuts would be used to stimulate the economy which so badly needs stimulation.
As my leader has said on other occasions about his economic policies, we want Canadians to take their money out of their socks and put it into stocks. I am sure that putting money into housing would have the same multiplier effect as putting it into stocks. The point is: the money is active and doing something instead of being kept in a sock or in a low interest paying bank account to be lent out by someone else.
Also in his speech the hon. member referred to a few examples and compared our system to that of the United States. But unfortunately he omitted several credits from his examples and perhaps did not give the information he intended. It has been eight years since the last tax reform which the government assured would give equity and simplicity. I am sure there is not a single taxpayer who would say that we have achieved either simplicity or equity. The policy of my party would give some sense of equity to Canadian taxpayers and allow them to stimulate the Canadian economy by encouraging the housing industry with the purchase of homes.

Previously I mentioned the trip to Washington. I should like to make some comparisons between the system in effect in the United States and what we propose on this side. The system in the United States has been in effect for 66 years, ever since its tax law was introduced in 1913. All interest costs, including mortgage interest, have always been deductible, as are all state and municipal taxes. So they have an altogether different system. In the United States an individual is allowed to deduct $1,000 as a personal exemption. In Canada this year the amount is $2,400. In the United States they have to deal with 23 million tax returns which involve tax savings as a result of the government's taxation policy. Translated into percentages this means that 26 per cent of all U.S. tax returns filed bring some kind of benefit as a result of tax deductibility; the others are satisfied by the standard deduction which, in the case of a married couple, is $3,200 in addition to the personal exemption of $1,000.
We also found that fully 50 per cent of home owners in the United States have no mortgages of any kind on their houses. Of the remaining 50 per cent, 25 per cent have mortgages on their homes but the deduction does not give them any benefit over and above the standard deduction. Thus, only 25 per cent are taking advantage of the policy.
The plan has been criticized on the ground that it contains no benefit for tenants. I ask hon. members to think for a moment. If we can get some of these tenants out of the homes they are presently renting and encourage them to buy homes, we shall be increasing the supply of rental housing or reducing the demand upon it. To look at things in another way, the effect will be to reduce or hold steady the level of rent which has to be paid for these units. Thus we would have helped tenants who choose to stay on as well as those who wish to leave by making it easier to move out.
We have heard criticism on the ground that the people of the United States did not really want this program but that once it has been introduced it could not be removed because it was politically popular. Of course, it would be unpopular for the bureaucrats in the government to get rid of it because those who are benefiting from the program like it very much. Incidentally, we were astonished by the size of the bureaucracy required to run the very many housing programs which are in effect in the United States. It is enormous, and we cannot imagine anything like it in Canada. But the tax deductibility scheme in the U.S. is run through the Internal Revenue Service in accordance with a simple procedure which does not require any addition to the bureaucracy; not even 600 people, as in the case of the AIB, and not even 100, as in the case of the NCI.
So there is what is called a reduction in revenues to put money into the system where it belongs without requiring the creation of an extensive bureaucracy along the lines that almost all housing programs seem to require. One figure I have here shows that the government was spending $250 million on housing programs in a recent taxation year.
March 5, 1979

What happened in the United States was this. We found a situation reported to us in which poor people who needed housing assistance from the government were living in homes which were almost palaces in middle class neighbourhoods, whereas the middle class taxpayers who were paying for this subsidized housing could no longer afford to live in housing of a comparable quality. Is it any wonder, then, that the middle class is rising up and supporting a program which will allow them to live a little better, when they see people who are supported by their tax dollars living in a classier manner than they themselves can afford?
The policies we have put forward will be accepted by the Canadian people. The lack of action on the part of the government in planning the economy in such a way that ordinary people can still afford to buy houses and live in them afterwards is an example of poor performance that Canadians will not accept.


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


An hon. Member:: No.


Mr. Ian Watson (Laprairie):: Mr. Speaker, the bill which is before us today is both useful and welcome. I am glad to note that the sources of funds available for housing in Canada will be broadened by this measure. I am happy, too, with the heritage preservation provisions to which the Minister of Indian Affairs and Northern Development (Mr. Faulkner) referred earlier in the debate. They will allow for CMHC guarantees to be used in a more effective way to permit greater private financial participation in the preservation of both neighbourhoods and individual buildings.
In my view, it is of great importance that buildings to which special merit and associations are attached should be preserved. They enhance the quality of life in our cities, improve the atmosphere of the neighbourhoods in which they exist, provide a link with our past and are increasingly popular focal points for the renovation of our city cores. So this bill, with the possibility it offers for increased private financial participation in the work of renovation, is indeed welcome.
I am also pleased about the provisions which will allow greater access to funding under the National Housing Act on the part of Indian people. In the last few years we have seen situations where many Indian people refused to utilize the method of establishing corporations to take advantage of the non-profit sections of the act. As a result, the housing programs which are available to them are much more restricted than might have been the case.
In my own area of Caughnawaga there were over 1,200 men unemployed last year, most of whom were experts in the high steel industry. They were not able to take advantage of this large reservoir of unemployed skilled men to build the housing which was needed and which many people on this reserve
Housing
could afford, simply because there was no means of tapping the funding available under the National Housing Act.
These changes are very useful, and I would urge the House to pass this bill soon so that this funding can be made available for native people on reserves across the country who are desperately in need of better housing and who up to now have been restricted in their ability to achieve this housing because of the limited funding available from the Indian affairs department itself.
One aspect of the situation regarding access to funds available through the National Housing Act for Indian reserves which I feel the government should consider at second reading as a possible amendment to this bill is with regard to opening up the provisions dealing with land banking or land assembly which existed under the National Housing Act previous to the announcement by the government that it was ending this program with the provinces. This section is still in the act, as I understand it. I feel strongly that this particular provision should be opened up to Indian reserves. The reason is that many Indian reserves, especially those close to cities are experiencing the phenomena of land and buildings being sold at fire sale prices because Indian land and buildings can only be sold to other Indians. For example, in an estate sale, or where one must sell land for one reason or another, there is a limited market for the sale of that land. Usually there are about half a dozen people or less on a given reserve who happen to be successful businessmen or who have amassed money in one way or another, and they end up acquiring huge amounts of land on a given reserve. These are Indian people who have done well.
It goes against the tradition of all the Indian groups across Canada to have what was originally considered communal land but for which usufructuary rights were recognized, now being concentrated in a very few hands, and often acquired at prices which are unfair to the people or the estates selling the land. A very slight amendment in this bill would allow the land banking provisions or the land assembly provisions of the act to take effect, and if this were the case it would be possible for a band council to acquire funding from National Housing Act sources such as CMHC and thereby acquire the land at reasonable prices. They could preserve that land for the use of either the community or for resale at a more equitable price to other Indian people. It is a very unhealthy situation which is developing in this regard, and I urge the minister of Indian affairs to give my suggestion serious consideration. I will be raising my proposal again when this bill is before committee following second reading.
One other item in this bill which I like is the reference to community services. Unfortunately, the provision is not operative until 1980, but it does offer the potential of flexibility which will allow communities to do many of the things which they themselves have found are working well with some of the existing programs, such as the neighbourhood improvement program. This is a program which the government has decided to terminate, and I regret that very much. This program has done some interesting things in several areas of Canada,

March 5, 1979
Housing
including my own constituency of Laprairie in the village of LaPrairie. I would urge the minister to be most sympathetic in considering whether or not to allow this sort of program to continue under the new community services title.
Over the years I have heard a number of interventions by the opposition with regard to housing. There seems to be one theme which they constantly repeat. Perhaps the official opposition does not take the extreme position of the hon. member for Vancouver Quadra (Mr. Clarke) that the government should get out of housing altogether.


William Hillary (Bill) Clarke: That's what the board people say.


Ian Watson: Nevertheless, the position of the official opposition to a great extent has been, "let the private developers do it." What they are saying is that we should let the private developers make their profits, let them speculate and let them do what they did in Toronto and around Ottawa. House prices in Toronto are approximately $20,000 higher than they should be and probably $10,000 higher than they should be in Ottawa. These higher prices have resulted simply because governments-and this includes our own because we do have some responsibility in the Ottawa area-have allowed situations to develop where land was acquired almost entirely by a small group of developers. The end result of this monopolization of land ownership around cities such as Ottawa and Toronto is tremendously higher prices for housing than are necessary.


William Hillary (Bill) Clarke: You want more state control.


Ian Watson: Since 1953 we have had on our statute books laws which permitted land assembly. The hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), who was undoubtedly responsible for the land assembly effort in Saskatchewan, is well aware of the successful land assembly program in that province. There land prices have continued to be among the lower land prices in the country around cities, and this is largely due to that government taking advantage of the land assembly provisions when land was still inexpensive.
Had this very same thing been done around Toronto and Ottawa, these two cities would be facing an entirely different situation today. These people who urge the federal government to get out of housing and out of urban affairs, unfortunately, seem to be having some success because we seem to be taking their advice. But what does it mean to get out of urban affairs? It means higher prices for the average home owner over the long run. Home prices in Ottawa could have been controlled by a combination of land assembly, National Capital Commission policies, government hiring practices, government renting practices in its buildings-


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



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Turner):: It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Saskatoon-Biggar (Mr. Hnatyshyn)- Labour Disputes-Action taken to avert possible strike of Vancouver dock workers; the hon. member for Madawaska-Victoria (Mr. Corbin)-Regional Economic Expansion- Inquiry whether agreement reached with New Brunswick on additional development; the hon. member for Fundy-Royal (Mr. Corbett)-Trade-GATT negotiations on non-tariff trade barriers.
It being five o'clock, the House will now proceed to the consideration of private members' business as listed on today's order paper, namely, notices of motions and public bills.


PRIVATE MEMBERS' MOTIONS
Yvon Pinard: Mr. Speaker, it seems there is unanimous consent that we proceed to notice of motion No. 17 and that the preceding notices of motions be allowed to stand.


The Acting Speaker (Mr. Turner):: Is it agreed that items Nos. 7, 9 and 16 stand by unanimous consent?


Some hon. Members:: Agreed.


AGRICULTURE
Mr. Bert Hargrave (Medicine Hat) moved:: That, in the opinion of this House, the government should consider the advisability of introducing beef import legislation to establish reasonable quotas on the importation of fresh, chilled and frozen beef and veal, including provisions to relate imports counter cyclically to the domestic beef supply cycle, and to thereby assure consumers of more stable supplies.
He said: Mr. Speaker, it is my understanding that this is the first debate on a motion or bill to come before the House on the subject of a Canadian beef import law. During the last session there was a private members' bill that did not reach the House and there are at least two more private members' bills on the order paper. Needless to say, this exercise is a labour of
March 5, 1979

love that I am privileged and proud to be involved in on behalf of Canada's beef cattle industry.
I am proposing new legislation involving the importation of beef, such legislation to include the following aspects: it should apply universally to beef imports from all sources; import quotas should be established annually based on historical averages that relate to the traditional beef cycle as experienced in Canada and the United States; imports should be inversely related to anticipated domestic beef supplies, the quota formula should reflect a provision for counter-cyclical quota adjustments, and live cattle should not be included. I see no reason to incorporate a price limitation since quantity quota limitations that reflect our domestic supplies should assure consumers of more stable supplies of beef. There should be no need to increase the import tariff on beef. This is in recognition of the trade we have with the United States.
These are the essential component parts of my proposal and I will return to them in more detail later.
Hon. members may ask why we need a Canadian beef import law, why we should not just continue with the annual quotas set by the Export and Import Permits Act as was done in 1977, 1978 and for the current year 1979. There are a number of important reasons for this. Canada is the only country involved in meat importing that does not have such legislation at the present time. The United States has had a meat import law since 1964 and its application-or, more properly, the threat of its application-has been very effective. In its operation, the United States asks for voluntary limitations on beef exports by exporting countries to levels suggested by United States quotas.
I should like to deal in particular with 1976. With respect to beef imports and in particular offshore imports-that is, from New Zealand and Australia-that one year provides reasons enough for a Canadian beef import law. During that year we imported 183 million pounds of beef from Australia and New Zealand, an increase of 63.9 per cent over 1975. This represented the equivalent of 523,000 head of live cows or half the total cows slaughtered in Canada that year. The cow comparison is made because those offshore beef imports competed directly with our cow beef. If we had been short of domestic beef supplies in 1976 as we are now, our Canadian cattle industry might have tolerated this, but 1976 was also the year of our all-time high record beef production. By comparison, our cattle numbers today are about 18 per cent lower.
That year, 1976, was also the year of the infamous "six cents under" rule established by our government. This decreed that all offshore beef entering Canada had to be discounted at not less than six cents per pound under the same types of meat entering the United States. These price discounts were usually 20 to 30 cents per pound below the U.S. level for the same imported beef and of course established a Canadian ceiling on cow prices at what were generally considered disaster levels. Today, two years later, I am firmly convinced that the negative impact of these two items on our domestic industry was the major reason for delaying the turnaround in cattle prices by a full year.
Beef Import Quotas
Thanks to their import law United States offshore imports were 7.8 per cent of domestic production in the key year 1976, and only slightly above their historical average. In Canada the corresponding figure was 12.6 per cent.
Canada and the United States share the same North American cattle and beef markets, so it is essential that both countries' proportional share of these offshore beef imports be approximately the same.
The Canadian cattle industry has just come to the end of the contractual phase of its ten-year cattle cycle. The earliest opportunity to begin the national herd rebuilding will be next fall when more cows will be retained and increased numbers of heifer calves held back for breeding purposes.
More than anything else our industry is looking for indications of confidence and stability. The last thing we need is another year like 1976. That confidence and stability could be brought about with the help of a Canadian beef import law that would establish an atmosphere of predictable confidence which could only come with proper legislation instead of ad hoc, year by year, behind the scenes manoeuvring.
I mentioned the beef cycle earlier and perhaps some further comments would be appropriate. We hear more and more these days about taming the beef cycle. This is a noble and commendable objective but we should not hold our breath in expectation. If cattle producers and consumers were to learn more about it and understand why certain phases occur, I think everyone would be much better off.
The traditional cycle lasts about ten years and the numbers peak at the midpoint-for example, in 1955, 1965, 1975-and it is anticipated that the next number peak will be 1985. The beef supply-not the numbers-peaks about two years later. The expansionary phase will begin late this year in the current new cycle, with additional hold backs of cows and replacement heifers-mostly heifer calves. This in turn will still further reduce cattle numbers available for slaughter.
The 1965 peak was barely noticeable because of a world demand for beef, especially from new consumers, and increased per capita consumption on a global basis. That state of euphoria for cattlemen ended abruptly with the world energy crisis. Food dollars that had been buying the most expensive food of all, beef, had to be diverted to energy use. The result was a global oversupply of cattle and beef and the most rapid sell-down of cattle numbers in our history. That all took place within two years. It will require at least four years to rebuild and the process cannot be speeded up because of the simple biology of the cow.
The Canadian cattle industry is in the early stages of recovery from the worst crisis in its history. For the previous four years, prior to early 1978, lost equity in the industry has been estimated at $400 million.
The numbers sell-down has been greatly exaggerated by the need to continue selling at today's very high prices, and for one reason only-to satisfy our creditors, mostly bankers, who financed those four years of losses.

March 5, 1979
Beef Import Quotas
Only three other countries produce cattle and beef which can be exported to Canada in any significant numbers. These countries are Australia, New Zealand, and the United States. Mexico is involved in a minor way since Mexico exports some cattle and beef but only to the United States. South American cattle countries are not a factor because of our animal and human health requirements which exclude them from exporting to the United States and Canada. The beef cycles of those three countries are synchronized with our own. The 1979 calf crop, not yet born, will not appear on our dinner table for at least another two years. From a per capita consumption point of view Canadians consumed 112 pounds of beef in 1976, the year of our all-time high supplies, but 108 pounds in 1977 and 102 pounds last year. The 1979 estimate is about 95 pounds. This is two pounds higher than the previous 10-year average ending last year. I maintain there is no shortage of beef, but there is a lower supply than there was in 1976.
The base period in the proposed beef import law should coincide with this beef cycle in some manner. I suggest we should have a ten-year base period, say from 1965 to 1975 if numbers are to be the key, or from 1967 to 1977 if supply is to be the criterion. If a shorter half cycle is necessary to start the policy, then use a five-year cycle which is balanced on either side of the high or low points. There is already a probable exception to this historical cycle in that the new cycle now starting will last at least two years longer because of the extra time required to rebuild our breeding herds.
There are valid reasons for not including live cattle in my beef import proposal. First, simply because the United States law does not cover live cattle, our legislation should not try to be more protective than the U.S. law. That is an important point. We cannot expect to get more than the American law when we are trading back and forth. The Canadian-U.S. trade in live cattle and beef is a two-way trade, whereas oceanic beef imports are a one-way trade item. Canada and the U.S.A. are essentially net importers of beef. Canada traditionally exports feeder cattle and cows, mostly from the west to the United States. The U.S. in turn exports fat cattle and/or beef to central Canada. In both cases this only occurs when appropriate market price conditions prevail. Canadians should not forget that the United States is essentially the only market available to us for both import and export purposes for live cattle and beef. In this regard I am referring to our commercial beef cattle industry and not to the purebred side of the industry.
The timing of my motion today is most appropriate in that Senate Bill S-13 on the same subject is now before their Standing Committee on Agriculture. I sincerely commend the Senate for their efforts in this bill. I would say it is a logical development of their in depth study of Canada's beef cattle industry concluding with their report of October, 1977. This report is entitled "Recognizing the Realities-a Beef Import Policy for Canada" and was the result of their committee listening to cattlemen talk about their industry across Canada. In my opinion, this Senate study and report has quietly put to

rest the 1976 MacKenzie commission of inquiry into the marketing of beef and veal.
In his opening remarks on Bill S-13, Senator Sparrow had this short quotation, with which I thoroughly agree. It reads:
The hearings indicated that the most critical and pressing problem concerned the importation of beef into Canada, or, more precisely, the lack of effective rules pertaining to the importation of beef into Canada.
The hearings mentioned above were those of the Senate Agriculture Committee on its travels across Canada. Senator Sparrow went on to say:
Uncontrolled imports, without a firm long-term goal, backed by legislation, has caused numerous negative results for the Canadian producer and consumer.
As I have already indicated, I cannot support the inclusion of live cattle in this Senate Bill, nor do I feel that their use of "signal price" is essential or necessary.
Since my proposals have many similar features to the American legislation, some brief comment on their beef law seems appropriate. Last year a serious effort was made to amend the United States Meat Import Act of 1964. The 1978 amendment was passed overwhelmingly by the 95th Congress. It passed the Senate by a voice vote and the congress by a vote of 289 to 66, but it was later vetoed by President Carter on November 11, 1978. The amendment's principal clause dealt with the protection of producers during the liquidation phase. That is the phase we have just come through. It proposed to do this by means of a counter-cyclical formula. Live cattle will continue to be excluded in the American bill. The loophole in the old act relating to what they referred to as "slightly processed beef' would be closed. The President's veto was based on proposals to limit the President's discretionary powers in the proposed amendment bill. President Carter's veto memorandum ended with this quote, and I think it is very significant:
I am prepared to work with the Congress next year-
"Next year" in this case means 1979.
-to pass a counter-cyclical meat import bill which will provide the stability and certainty the cattle industry requires, while preserving the President's existing discretionary authority, and setting an acceptable minimum access level for imports.
That says it all as to why the amended bill last year failed to get the President's support, but indicates he is prepared to support a new bill.
With respect to my own proposal, I suggest that that provision might be made for periods when our Canadian beef import law can be suspended from time to time when conditions exist. I would be prepared to see that incorporated into Canadian law.
In conclusion, the concept of a Canadian beef import law has received wide support from across the nation, from government departments, both federal and provincial, from almost all cattle producer organizations across Canada, with major and detailed research and specific suggestions that have been supplied for several years from the Canadian Cattlemen's Association, and I am reasonably certain I can expect some
March 5, 1979

form of support from members in other political parties, including, I am sure, certain cabinet ministers.
We should all be aware of the joint policy statement issued by the Minister of Agriculture (Mr. Whelan) and the Minister of Industry, Trade and Commerce (Mr. Horner) last March 30, 1978. They proposed an import quota policy for the next three years, that is, from the March 30 date. That release concluded with this statement:
If, at any time, it is not giving satisfactory protection to the Canadian beef industry, we will introduce legislation to control imports.
The "it" referred to is the policy.
The Canadian cattle industry is about to begin the rebuilding of its entire breeding herd after surviving the most critical period of its 100-year history. It is vital that this industry has unshakeable confidence in the long term outlook for our cattle industry. This rebuilding will take years. Let us not forget what happened to the Canadian sheep and lamb industry when offshore imports took over. Canadians today eat only about 1.8 pounds per capita of lamb or mutton. We need a Canadian beef import law.


Mr. Ellis:: Mr. Speaker, I know a number of members want to get involved. However, I wonder if I might be permitted to put one brief question to the hon. member for Medicine Hat (Mr. Hargrave)?


Mr. Deputy Speaker:: Because the time of the hon. member has expired, that can only be done with unanimous consent. Is there consent?


Some hon. Members:: Agreed.


John Raymond Ellis: Mr. Speaker, the hon. member for Medicine Hat has the most extensive and probably the most comprehensive knowledge on this subject in the House. However, he said one thing that raises a question for a farm boy from Hastings country. The hon. member mentioned the cyclical production of the various countries being synchronized. Is that a happy circumstance or something that is planned?


Herbert Thomas (Bert) Hargrave: Very briefly, it is a fact of cow life. It has developed over hundreds of years. Every country is now in the same process that we are in, that is, involved in numbers that they can import or export. It is not that every country in the world that raises cattle has a problem like this created by the cycle, only Australia, New Zealand, the United States and Canada. They are the only countries with significant amounts of cattle and beef traded back and forth. Therefore, those are the only countries which have to live with this situation.


Mr. C. Douglas (Parliamentary Secretary to Minister of Communications):: Mr. Speaker, I congratulate the hon. member for Medicine Hat (Mr. Hargrave) on putting forward this motion today. As he said, it is a very timely motion, one which the cattlemen, the producers and the consumers are vitally concerned with at this time in the beef cycle.
Beef Import Quotas
Many times in this House we have heard complaints about the price of beef being too high, rising too quickly and everybody is to blame. I am not sure that anyone is to blame for the prices. The price that the consumer in Canada pays for beef, veal and produce such as that has remained almost constant in the past 20 or 30 years compared to the buying power of the worker. In 1950, he spent about 2.5 per cent of his disposable income on beef. That is exactly what he spends today. It costs about 2.5 per cent of his wages for the beef that he buys to put on his table. The difference, as was pointed out by the hon. member for Medicine Hat, is the amount the housewife is buying. In 1950, Canadians consumed approximately 50 pounds of beef products per capita. In 1979, it is estimated we will consume about 95 pounds per capita.
The increase in the amount of beef and beef products consumed has been rather remarkable over the past 20 years. It is also remarkable that the price of that beef still accounts for 2.5 per cent of the total income of the wage earner. There is no lack in the amount of beef. It is the demand for that beef that has risen substantially over the past 50 years.
I come from a large finished-beef producing area in western Ontario. I have the honour of representing one of the largest beef producing areas in eastern Canada. Stability of price, both for the finished product and input costs, has a resounding effect on the over-all economy of the area I represent.
It can be seen from my opening remarks that I am certainly in favour of the motion put forward by the hon. member for Medicine Hat. In fact, I am the one the hon. member was referring to in his opening remarks. I have a bill respecting the importation of beef which I hope will be discussed during private members' hour, hopefully before we are out of here. I hope the hon. member will take part in that discussion as well.
Like the hon. member for Medicine Hat, my concern is not only with stable supplies but with stability of demand for the primary producer. This is borne out by the fact that I have a bill, which will give to the Minister of Agriculture (Mr. Whelan), the power to impose import regulations when in his opinion the economic and national interest of Canada would require it.
It is all well and good to say that we have a form of import regulation. It is true, we do. As well, we must have some protection for the primary producer. We should have legislation in place that can be triggered if a situation such as that which took place in 1976 should occur or appear that it is going to occur.
As hon. members know, the primary producers of beef in Canada, from the cow-calf operator right through to the finished cattle operator, have in the past three or four years come through one of the most disastrous slumps in the history of the beef industry. Much of the reasoning and the effects of that has been outlined by the hon. member for Medicine Hat.
In the industry they have what are known as cyclical hills and valleys, due in part to the producer's reliance, and I think rightly so, on the supply and demand position. That position can be greatly influenced, as it was in 1976, by a large influx

March 5, 1979
Beef Import Quotas
of offshore or imported beef and veal into an already volatile domestic beef situation.
To the hon. member referred to the Senate bill. It was my pleasure today to talk with the secretary-manager of the Canadian Cattlemen's Association. While he agrees in principle and in general with Senate Bill S-13, there are two aspects of that bill which give the Canadian Cattlemen's Association a very distinct feeling of uneasiness. One aspect is the bill's reference to live cattle. The other is the reference to the triggering mechanism in that bill which gives the cattle producers and their representatives a great deal of cause for concern. It is known as a trigger price or signal price which triggers the bringing into effect of the beef import law.
The cattlemen and their representatives feel that a trigger or signal price could be misconstrued by both the consumer and those in charge of it. It gives them great concern that the signal price could be set either too low or too high, and thereby give an improper effect to the legislation which the Senate has proposed. I hope that will be thoroughly discussed. I understand that representatives of the Canadian Cattlemen's Association will appear before the Senate committee on the fourteenth, if my memory serves me correctly. Both of those points will certainly be discussed at that time.
The importance of live cattle has been dealt with by the hon. member for Medicine Hat and really needs no further comment, except that I believe we have to take into account the fact that the cattle industry supplies the domestic Canadian market and, more important, the North American market, which the producer looks upon as having even greater importance in the future planning of the beef cycle than just the domestic market because of the flow of live cattle north and south, mostly from the western provinces into the American system, and their return as finished cattle here to us in the east. That is an historical situation which has grown up over many years of good trade patterns between ourselves and our neighbours to the south, which could be disastrously affected if the live cattle question in that Senate bill is not considered carefully.
We saw what happened back in 1973 or 1974 when an embargo against the movement of live cattle was brought in- I believe justly-by the Canadian government, and we saw the reaction of the United States government, which I thought was somewhat unfair. That reaction included tariffs and the prohibition on the movement not only of beef cattle but also of pork, chickens, turkeys, and almost everything else. The United States reaction was very quick and almost disastrous for the Canadian beef and meat industry.
The reason mentioned by the hon. member for Medicine Hat for not including in his motion or in the Senate bill-and I do not believe it would be included in mine-the live cattle trade, is of vital importance to the Canadian consumer and to the Canadian producer. My concern is that while the instrument in place at the present time-and I will talk about it in just a moment-gives protection to the producer and consumer

in the short term, I believe it must be backed up with legislation which will produce the same type of production over the long run of the beef cycle.
Just what is in place now? The government took steps to establish reasonable quotas on the importation of fresh chilled and frozen beef and veal. Beef import quotas were applied in late 1976 and were in effect through 1977 and 1978. They are in effect in the current year. Quotas are administered under the existing Export and Import Permits Act. Furthermore, as announced in March of last year by the Minister of Industry, Trade and Commerce (Mr. Horner) and the Minister of Agriculture (Mr. Whelan), the government has an ongoing policy of import controls on beef and veal which will be in effect for a three-year period, at the end of which it will be evaluated, and alternative measures will be taken if necessary. In this regard I agree with the hon. member for Medicine Hat. I would like to see that over a ten-year period because the beef industry works on a ten-year cycle. This would afford the protection which is required and allow for the basic input which I do not think a three-year period does.
The current policy arose out of producer concerns in recent years, very justifiable ones, about the possible effects of beef imports at a time when low prices were causing serious difficulties in the industry. What that points out to me is that it was a reaction and not an action. I believe that now is the time to take a very conscious and clear look at the situation of our primary producers of beef products and to take action so that we do not always have to be reacting to situations which arise. The legislation put forward by the hon. member is that type of action in a time of comparative quiet, shall we say, when returns to the producer are at a level which balances with input costs. We have to remember-and not often enough is this put forward-that the primary producer of beef, or any agricultural product, is also one of the country's largest consumers. He consumes energy in large amounts. He consumes all the things the consumer in the city looks upon as being highly priced.
Many primary producers buy beef, pork, chickens or eggs from the same supermarkets from which city consumers buy. To say that they are not concerned about high prices is a complete fallacy. They are perhaps more concerned about high prices in supermarkets than consumers who receive weekly wages from Ford or any other industry in the country. Producers have to face high prices, just as inevitably as city consumers.
With respect to that I would like to point out to hon. members an article which recently appeared in, I believe, one of the Ottawa newspapers. This article brought to my attention the fact that we in Canada are not as badly off as some people would like us to believe when it comes to buying beef, eggs, or poultry. The article is entitled "Eat Up, Ottawa! Our Food Prices Are Low". This was not a Canadian survey. It was not one which anyone could say the government had rigged so that it would come out the way the government wanted. This survey is taken every month by the agricultural attaches in U.S. embassies in 15 countries around the world. It is impor-
March 5, 1979

tant to know the results of this survey. 1 admit that we do pay a good deal for most of our manufactured goods, especially imports, but the U.S. government has produced statistics showing that Canada is a world leader in something other than shovelling snow.
The article to which I refer reads in part as follows:
When it comes to food, we're on top of the heap, despite domestic price hikes and the plummeting dollar's effect on the cost of fresh produce we import for six months of the year.
Figures released this week show that on Jan. 3, at the height of our import season, Ottawa stores charged 21 per cent less than their counterparts in Washington, D.C., for a shopping basket of 21 items.
That must say something about the producers in this country.
Agricultural attaches at U.S. embassies in 15 capital cities survey local grocery stores once a month to determine prices for such staples as meat, eggs, butter, milk, tomatoes, bread, rice and sugar.
The results of the January survey published in the U.S. Department of Agriculture bulletin, Foreign Agriculture, help put domestic price trends into perspective.
The bulletin also compares the number of hours an average industrial employee must work to earn enough money to buy a given amount of food, based on mid-1978 Figures.
The February issue shows that although Canada had one of the highest increases in its consumer food price index in the 12 months ending in November, 1978, our January prices were 21 per cent below U.S. levels and substantially below Japanese and German figures.
The article cites the example of sirloin and refers to a kilogram of sirloin steak. If my mathematics have not gone completely out the window, a kilogram is 2.204 pounds. 1 will never get used to that. The article goes on:
Sirloin steak was selling for $5.62 (U.S.) per kilogram in Ottawa, $6.37 in Washington, $9.74 in London, $14 in Bonn and an unbelievable $41.20 in Tokyo.
The difference between Canadian and U.S. wage levels was almost enough to wipe out the advantages of our lower prices, but not quite. A U.S. citizen-I am speaking of the 21 items used in the survey-would have to work 8 hours 31 minutes to pay for the same shopping basket that a Canadian can afford by working 8 hours and 28 minutes. So the difference is 3 minutes on a full shopping basket.
What is of vital importance to the consumer-I hear people talking about the industry of the Japanese and the Germans and about everyone there being so much better off than we are-is that in Ottawa, for instance, a Canadian would work an hour and 2 minutes for those sirloin steaks, and in Tokyo a Japanese would work 8 hours and 11 minutes to pay for that one kilogram of sirloin steak. The question is the same right across those lists. With regard to boneless roast chuck, in Ottawa a Canadian would work 37 minutes for a kilogram of that meat, in the United States they would work about 35 minutes, and in Tokyo they would work 4 hours and 14 minutes for it. What this points out is that despite the gloom and doom of some people in Canada when it comes to the food price index, the fact is that the Canadian primary producers are providing this country with the finest food at the cheapest prices anywhere in the world.
Beef Import Quotas
What this motion is all about is providing the primary producer with an assurance that some of the valleys and pitfalls will be taken out of the cyclical endeavour and provide him with the knowledge that over a ten year period, or over the life of his input into the industry, there will be something on which he can count, should the need arise, to protect him from unfair competition-and I think in 1976 it certainly was unfair-from offshore beef imports.


Lorne Edmund Nystrom: Mr. Speaker, first of all I want to compliment the hon. member for Medicine Hat (Mr. Hargrave) as one of the few members of the House who has real expertise-I say that with sincerity-and working knowledge in his area of interest in the House, that is, in the beef industry. When he speaks I pay a great deal of attention to what he says. He speaks from his heart, with a great deal of experience and knowledge in the area.
I want to say at the outset also that I support the general direction of his motion, but I have one difference with him which is a philosophical difference because I do not think what he is proposing will be adequate to solve many of the problems of the beef industry today. What I want to argue for is a national beef marketing board, something that is supported by a large number of people across the country. As the hon. member for Medicine Hat has already said on many occasions,
I know also that there is a large number of people across the country who do not want a national beef marketing board. So this is a philosophical difference between the two of us.
Before I go into that subject, however, I want to underline a point made by the hon. member for Bruce-Grey (Mr. Douglas), and that is that in general in this country we as Canadians are not paying an excessively large part of our disposable income for food. We pay about 15 per cent or 16 per cent for food. The Americans pay roughly the same amount of their disposable income for food, the Europeans pay close to 30 per cent, the Japanese more than that, and the people in India pay around 60 per cent. When we talk about food prices, we must put things into perspective. What we must watch now are companies, retailers and the like, taking excessive advantage of the consumer with excessive mark-ups. That is what we must watch in terms of food pricing.
Let me get back to this motion. As I said, I do not think it is quite adequate or that it goes quite far enough, because I believe we need a national beef marketing agency for two groups of people in our country, for the producer, in terms of making sure he has a stable price for his commodity, and for the consumer to ensure a stable price in the retail market for the commodity which the consumer is purchasing.
Let me offer one or two arguments in favour of what I am proposing. All we have to do is to take a look at the price increases in food across the board in this country. We find that price increases in products in which we have national marketing boards-we now have three and will soon have four in operation, the egg marketing board, industrial milk, and turkeys-have been lower than in products which do not have national marketing agencies to manage supplies and tailor supply to demand. One of the problems we have in beef is that

March 5, 1979
Beef Import Quotas
we do not have such an agency, and because of that there are tremendous fluctuations in the price of beef which hurt both the farmer and the consumer.
I could go over some of the history of beef prices, which has already been done in the House. Beef prices started to drop below the floor level, so far as the producer was concerned, in 1974. They became worse in 1975, and even worse yet in 1976. They stayed at that level in 1977, and it was not until April, 1978, that the price of beef for the farmer started to go up. What happened was that when the farmer was selling his cattle and getting less than the cost of production, he started to sell the herds. This is a normal reaction. We all agree that that is what happened. When a farmer or a rancher does that, he cannot replenish his herd quickly, as the hon. member for Medicine Hat said. This takes a long time. A cow has a calf once a year, not like chickens which reproduce rapidly. When the hon. member for Elgin (Mr. Wise) goes to the supermarket to buy a chicken, he buys one that is only about 60 days old. You cannot do that with beef. You cannot turn the tap on and off at will or at whim.
The result was that when we had an oversupply, the price was low and people started to sell off their herds. Now we have an undersupply. One reason for the oversupply was that back in 1973 the Italians and the Irish-the Italians because of some problems they had with their economy because of the high price of oil and because of OPEC, and the Irish because they had cattle which they wanted to sell-persuaded the European Economic Market to import fewer cattle from abroad. They persuaded EEC to curtail imports, and those imports were primarily from Australia. As a result, the Australians had to get rid of their beef somewhere, so they sent it in abundance to Canada, and that helped to distort the Canadian market and hurt Canadian producers. It created many of the problems we have today with beef in our country.
How do we solve those problems? I think only a partial answer is found in what the hon. member for Medicine Hat has said in the House today. As I said, I have a philosophical difference with him. I do not think one can deal with the problem of EEC unless there is a national marketing board, because unless you have a national supply-management board or orderly marketing, GATT agreements tailor your supply or production. You are not allowed to do that, and you need some form of orderly marketing, such as we have in turkeys, eggs, industrial milk or broilers. In order to have that type of planning, we need a national marketing agency of one sort or another. I do not think the type of import laws the hon. member suggests are adequate. They are better than nothing and obviously a step in the right direction, but that is one reason why we should go further to create a national marketing agency.
Another reason is, as I said before, that it gives the producer a more stable price for his commodity, such as producers get for eggs, poultry and milk. It means also that when the consumer has the product in the supermarket, he is paying a more stable price, the mountains and valleys are taken out of

the pricing mechanism and what you have is a planned economy, which is good for all.
Another reason why I am suggesting a national beef marketing agency is that we are not self-sufficient in beef and we will not be until we have a government policy which provides a guaranteed income for the producers. It should allow them to produce more of our own goods and commodities.
I have before me a group of statistics which I think the House will find interesting, and hopefully very shocking. They reveal a lot about Canadians which should be of concern to the House. The statistics come from the Senate. They were provided as background material for the consideration of Bill S-13, the Senate bill to control the importation of beef into Canada. These statistics are slightly different from the ones referred to by the hon. member for Medicine Hat, but some of the points are similar. The statistics refer to the net domestic production on a per capita basis in Canada. In other words, they refer to the net production of beef in the country. Also the statistics refer to the actual consumption of beef.
When one looks at these statistics, one will find that we are becoming less and less self-sufficient in the production of beef, according to the Senate. For example, from 1967 to 1974 the average net domestic production of beef in the country on a per capita basis was 85.9 pounds, and our consumption during that same time was 94 pounds per capita. It means that approximately 91 per cent of the beef consumed was produced in the country. We were 91 per cent self-sufficient. If one looks at the figures over the next few years, one will find the self-sufficiency starts to go down. The Senate had not completed the estimate or the accumulation of statistics for 1978, but it was indicated that we would be producing approximately 86.6 pounds of beef per capita and consuming approximately 101 pounds of beef per capita. That would make us 84 per cent self-sufficient. In 1979 the estimate is that consumers would consume approximately 93 pounds of beef per capita and that approximately 76.3 pounds of that would be Canadian beef. That means in 1979 we will be only 82 per cent self-sufficient. These are background statistics which were provided by the Senate researchers. They accompanied Bill S-13, which was introduced by Senator Sparrow a short time ago in the other place.
I have put those statistics on the record to show that we are becoming less and less self-sufficient in beef production. There is no excuse for that at all. We have the capacity to be an exporter of beef. We have a lot of land. We have a very small population. Farmers are in need of better incomes. We are in need of more jobs in the country. There is an unemployment problem. If more people were farming and producing cattle, there would be more people involved in packing, slaughtering, and the transportation of cattle. A better situation would be created all around. Of course there are the other economic factors of self-sufficiency as well, such as a better impact on the balance of payments, more economic activity and the like.
March 5, 1979

That is another reason why I feel there should be a national beef marketing plan for the orderly marketing of beef.
I should like to leave a few minutes for other hon. members to participate, so 1 will make my remaining points quickly. The heifer and cow herd in the country is being diminished. That is really a sad situation. We will have more problems in the future, and it is another reason why we require orderly marketing and more planning when it comes to the beef industry. The farmer is receiving less and less of the food dollar. A few years ago he received 60 per cent of the food dollar. Today he receives only 37 per cent of the food dollar. Anything we can do to help the farmer is indeed a move in the right direction.
My main point is that I think we require a national beef marketing agency for orderly marketing in beef, such as exists in the production of eggs, turkeys, and many other products at the provincial level. A similar agency should be introduced at the national level for beef. It would solve many of the problems of the producers and consumers. Also it would help Canada become ultimately self-sufficient in the production of beef. That would help every Canadian and the entire Canadian economy.


John Wise: Mr. Speaker, I appreciate the courtesy of the hon. member for Yorkton-Melville (Mr. Nystrom) in providing me with approximately five minutes to participate in the debate. I am sure a good number of other hon. members would have utilized their entire 25 or 30 minutes.
However, I should like to begin my comments by indicating that I welcome the opportunity of making a few brief comments in support of this notice of motion. I do so because I have a great deal of respect and admiration for the hon. member for Medicine Hat (Mr. Hargrave). In addition to this respect and admiration, I believe firmly the enactment of the Canadian beef import law proposed in this motion certainly is essential and paramount. I participate in this debate to renew my commitment and support, because the intent of this motion represents not only the views and the position of the hon. member for Medicine Hat, but moreover it represents the official position of my party. In fact it has been the official position of my party since September, 1976.
The beef industry is a Canadian industry and it is a large one. In 1973 it became a billion dollar industry. Because of the increased value of slaughter cattle and calves, this year the figure is expected to exceed the $2 billion mark. It should be noted and stressed that this doubling in sales values does not reflect the same pattern in relation to increased profits. Rather, it reflects the impact which inflation and rising costs have had on the beef industry. It reflects the disinterest and the failure of the government to provide the necessary leadership. It reflects the failure of the government to manage the Canadian economy with any degree of competence or success. It reflects the need for appropriate long-term goals, objectives, and programs which will interpret accurately the market signs. Also it reflects the need to provide equity and stability to Canadian beef producers.
Beef Import Quotas
A beef import law, accompanied by a deferred annual income annuity plan and some common sense provisions in the area of capital gains, which has been spoken about often by the hon. member for Norfolk-Haldimand (Mr. Knowles), would provide much needed stability to the Canadian beef industry. It would ensure the preservation of family farm management and ownership. It would greatly reduce and hopefully eliminate the government's sporadic intervention into the market place. Also it would leave the government free to perform only those necessary and proper functions of inspection, grading and dealing with animal health. Financial support would be limited to emergency and disaster situations.
In the remaining minute, let me conclude by saying that the beef industry, like food prices, has been studied to death. This measure was recommended and justified by Canadian beef producers two years ago. As I have indicated, it has been the position of my party for over two years. I commend the hon. member for Medicine Hat for his interest and efforts respecting this motion. I challenge government members to utilize this opportunity to pass at least one major piece of legislation before they strike out. I say to the beef producers of the country, if the government chooses to procrastinate throughout the remaining weeks or days of its mandate, we in this party will enact this legislation shortly aftr the next election.


Mr. Deputy Speaker:: Is the House ready for the question? The hon. member for Battleford-Kindersley (Mr. Mclsaac).


Mr. Cliff Mclsaac (Battleford-Kindersley):: Mr. Speaker, I rise to respond very briefly to the challenge of the hon. member for Elgin (Mr. Wise). I think beef producers will have a message for him, but we will wait to hear it.
I have no difficulty at all agreeing with the principle put forward this afternoon by the hon. member for Medicine Hat. At the same time, I believe we would be deceiving ourselves if we though the passage of such a resolution would provide the panacea for which many beef producers are looking. Last fall, President Carter showed the great weakness of that measure by usurping it. But by the same token I thought he proved the need for it because the increase of one more pound-


Mr. Deputy Speaker:: I am sorry to interrupt the hon. member but the hour appointed for the consideration of private members' business has expired.
It being six o'clock I do now leave the chair until eight o'clock this evening.
At 6.02 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
[Stage Direction]
March 5, 1979
Housing


[Stage Direction]
The House resumed consideration of the motion of Mr. Ouellet that Bill C-29, to amend the National Housing Act and the Central Mortgage and Housing Corporation Act and to make other related amendments, be read the second time and referred to the Standing Committee on Health, Welfare and Social Affairs.
Ian Watson: Mr. Speaker, at five o'clock I was pointing out to the House the calamitous effect which the Conservative party's negative attitude toward the role of the government in housing could produce if it becomes government policy, as it did for a number of years during a Conservative government in Ontario. In Ottawa houses cost up to $10,000 more, and in Toronto up to $20,000 more, simply because the government of Ontario took a hands-off policy with regard to land assembly and land banking. I was in the process, at five o'clock, of explaining that even the federal government, because of what I consider was an over-sensitivity to provincial responsibilities in municipal affairs and an under-sensitivity to the national consequences of failing to use the many instruments available to control land speculation in the Ottawa area, has in effect fueled inflation in land costs and thus in housing costs.
The National Capital Commission's and the Public Works Department's land holdings in the Ottawa area, government hiring policy, and government rental policy or the absence of an aggressive pushing of land assembly programs in the province of Ontario, are all policies or a combination thereof which unquestionably could have substantially reduced housing prices in the Ottawa area. These higher than necessary housing prices, added fuel to public service wage demands, and the federal government's acquiescence to these demands unquestionably contributed much to the inflationary wage spiral that has affected the ability of Canadians to compete on world markets.
We have often heard that housing prices are largely the result of the some 100 approvals that are necessary before a house is sold. I would ask hon. members to reflect on this. If land assembly takes place surely most, not all, but most approvals would be eliminated because there would be a much more precise planning process. Many planning steps which are now necessary to approval would be eliminated, or would not amount to the kind of brake on housing development that the critics allege.
In the Ottawa area the federal government tried to do something about land prices and at the same time create a model city that would be a Canadian crucible for better planned urban environments, where public transit and various urban features like totally planned energy conservation,

recreation and green spaces, and ail the factors that contribute to the quality of life, would be imaginatively co-ordinated to show what could be done when the public interest comes first. In spite of the federal government acquiring 5,000 acres through the NCC and the provincial government of Ontario another 4,000 acres, the Conservative government of the province of Ontario, assisted by the sniping of the hon. member for Grenville-Carleton (Mr. Baker), and more recently some sniping by the hon. member for Ottawa-Carleton (Mrs. Pigott), sabotaged the model city.
The developers who owned the undeveloped land immediately to the east of Ottawa where the Ontario government is approving housing for upward of 50,000 people, were considered more important than lower house costs and opportunities to show what could be done through planning imagination. Southwest city would have been a model for all Canadians. What a scandal, Mr. Speaker; what a tragedy that this opportunity was lost to all Canadians because the Conservative government of Ontario put the developers first and people second!
The worst mistake this government could make would be to follow the advice of the official opposition on housing policy, but unfortunately that seems to be what it has been doing recently. I refer specifically to this government's ill-advised and shortsighted termination of the Department of Urban Affairs. I will deal with that question later, Mr. Speaker.
I want to turn now to the suggestion made by the official opposition regarding mortgage interest deductibility. That proposition is as demagogic a suggestion as has been made in this House for a number of years. It is demagogic, because while it is patently unfair to everyone who rents rather than owns a house, and while it would cost the federal treasury up to $4 billion in decreased revenue-


Sinclair McKnight Stevens: Prove that.


Ian Watson: There are a lot of people who are better economists than the hon. member and myself, who have produced these figures.


Sinclair McKnight Stevens: You cannot back them up.


Ian Watson: I do not think the hon. member can, either. We are in about the same category as far as economics go- which does not say much for the hon. member for York-Simcoe (Mr. Stevens).


Sinclair McKnight Stevens: Back up your statement.


Ian Watson: The problem is that this particular proposition is very popular. I admit that politically it is very popular because it appeals to the selfishness in all of us.
The United States has had this measure in effect for 66 years. The group of members from both sides of the House who went down there to examine it, while they have taken public positions diametrically opposed to each other, heard one single story. I suspect they realized that the scheme does not make any sense, but it is popular. We all admit that.
March 5, 1979


An hon. Member:: You had better.


Ian Watson: If we are going to be responsible in government, surely we do not simply do what is popular.

As I said before, the proposal put forward by the Progressive Conservative party for allowing mortgage interest deductions would cost the treasury a considerable amount of money. If we are to pass such a measure, it seems to me certain social objectives should be tied in to such an initiative on our part. I can suggest, for instance, granting a tax credit to Canadians over 65 who live in their own homes. Obviously, it is better to encourage citizens of more than 65 years of age to live in their own homes than to build old folks' homes and send them to live there. That does not make any sense. It would be better, through some legislation or other, to encourage them to live in their own homes where they are happy; it would also be more advantageous for the state.
I am also convinced there are other deserving social goals that could be encouraged by the government instead of having the type of gifts promised by the official opposition. For instance, with respect to saving energy, all governments consider that objective valid these days, but unfortunately the steps taken in the last few years to encourage energy conservation are still inadequate. I have two or three suggestions to make, Mr. Speaker. By offering tax encouragements and using new systems of measurement in co-operation with the provincial authorities in the field of electricity, we could save considerable energy. I am thinking here of a meter system that would allow suppliers to set the price of the electricity used according to the various load periods.
Why are tax incentives not used to encourage the installation of these meters in private homes? I think they would cost $100 to $150. If the federal government and the provinces used their imagination and co-operated, they would encourage home owners to use electricity especially during off hours and thus save money. That would amount to tremendous savings. The money saved would easily be enough to pay for the construction of one or two major dams, one or two nuclear stations. If the government had some imagination, it would offer tax incentives in this area. I could say the same thing about the opposition which, instead of making rabble-rousing promises, to say the least, should propose things that make a bit of sense.
I have already mentioned that I am unhappy with one piece of advice which the government seems to have taken from the official opposition, and to me it is one of the more mindless recommendations that has ever been made by them. I am speaking of the termination of the Department of Urban Affairs. This is a genuine case-and I know this is an overworked saying-of throwing the baby out with the bath water.
Housing
The government wanted to save some money, but it could have abolished many of the urban affairs programs which were costing money. I would have been unhappy had it done that, but not only did it do that, the ministry has been thrown out as well.
As far as I am concerned the Department of Urban Affairs has provided a number of important initiatives. I will mention them in a minute. But let me outline the number of international organizations that believe the area of urban affairs is important enough in which to be involved: the Council of Europe; the European Parliament; the World Bank; and the United Nations. Even the North Atlantic Treaty Organization, through the Atlantic council, has been involved with a number of urban affairs programs. And the federal Government of Canada is saying now that we should have nothing to do with urban affairs.


Sinclair McKnight Stevens: What are you supporting them for?


Ian Watson: That particular decision to terminate the Department of Urban Affairs did not come before parliament. Its termination has been done by order in council.


An hon. Member:: By fiat.


Ian Watson: I support the bill we are talking about tonight. This bill was introduced at the same time the announcement was made that urban affairs was terminated. That is why I am dealing with the question of urban affairs which I feel has the potential to influence, more than any other ministry, the kind of future Canadians will enjoy.


Sinclair McKnight Stevens: Vote the ruffians out.


Ian Watson: Let me give you some examples of what the Department of Urban Affairs has been able to do in many parts of Canada. It is responsible for the initiatives that have resulted, for example, in the port front renewal in Halifax; Montreal's harbour front renewal; Toronto's harbour front renewal; the bicycle path along the southshore in my own constituency which engenders a fair amount of interest. In Quebec City-

-the St. Louis Basin, the Guy Favreau complex was changed through the efforts of the Ministry of State for Urban Affairs. The plans would have resulted in the creation of a white elephant. Thanks to the influence of urban affairs, the Guy Favreau complex will now be a valid and acceptable project for Montrealers.

The Lachine Canal project is another project.
There are dozens of urban initiatives across Canada that have come about because the Department of Urban Affairs was there. Surely there should be a realization that there is a need for co-ordination between different government ministries and between different levels of government. This co-ordination should be directed toward assuring a better urban

March 5, 1979
Housing
future, a better quality of life where the federal government plays a role, no matter whether it is in owning land, owning buildings, building new buildings in our cities, or whether it owns railways or wants to change railway lines. We passed the Railway Relocation and Crossing Act a few years ago which allows us not only to redevelop railway shunting yards in the middle of cities, but it also allows us to redevelop rail lines into cities for purposes of rapid transit. These laws are in the books, and we are neutering them, temporarily, I hope.
In my opinion, all of these very positive elements which the Department of Urban Affairs offered to Canadians while it was in existence, and the even greater potential it offers to Canadians in the manner it offers co-ordination between ministries and between levels of government, are so important that we are making a very serious error in removing a tool from our work kit that can influence our urban and suburban lives for a generation or two to come.
There are a number of other things I would like to mention. These are a number of pullbacks which seem to be the result of suggestions made by the opposition.

What shocks me most is that since World War II we have had the means to do better, but fearing too often to hurt provincial sensitivities, we have not dared insist on proper planning. We have not used our powers as moneylenders through Central Mortgage and Housing Corporation, for instance. We could have used this to force the municipalities and provinces to adopt better planning methods. Any hon. member present could give examples. Representing a suburban riding, I can give many examples to show that the need to rectify years of inadequate planning has given rise to demands costing millions of dollars. Had we dared use the powers our financial position gave us, we could have had an influence. If I may give you some advice, Mr. Minister, please do not be afraid to exert this influence, to insist on proper planning. It will cost you less in the long term. In fact, this is the same recommendation I can make for Urban Affairs.
It will cost ten times and perhaps 50 times as much to abolish Urban Affairs as to maintain it and-have adequate planning and co-ordination among the various other departments and government levels. The past often provides no encouragement. This co-ordination will be made without any incentive and we need a department like urban affairs to provide this incentive.
We must not forget, Mr. Speaker, that 80 per cent of Canadians live in the urban centres of Canada and that 6 million Canadians live in suburbs built since the Second World War. As I have just said, the quality of life in downtown areas and the suburbs suffers from a lack of long-term planning and co-ordination among departments and this lack of long-term planning and co-ordination has caused mistakes and deficiencies in municipal services. And even worse, the enormous cost

of certain planning mistakes has a negative effect on the efficiency of the Canadian economy and the capacity of Canada to compete on world markets. I mentioned the example of the price of houses in Ottawa which could at least have been reduced from $5,000 to $10,000 a unit if sensible action had been taken several years ago. This mistake on the part of former governments and ourselves has had an effect on inflation in Canada because of its unfavourable effect on wage demands by public servants.
The influence of urban development on our national economy, national energy requirements and the quality of life in Canada means in my opinion that the federal government must play an active role and contribute to ensure that federal policies and agricultural operations are co-ordinated at the federal level and with the other government levels. Furthermore, in the context of long-term planning, this influence will ensure the effectiveness of financial data.
I am convinced of one thing, Mr. Speaker, and that is that the Canadian people will long regret the decision of this government to abolish urban affairs if we do not take the initiative right now and suggest to our colleagues that the Department of Public Works take on additional responsibilities and that it become the Department of Urban Affairs and Public Works. In my opinion, this would give this department the prestige, the capacity and the talent required to meet the needs of our suburbs and urban areas in Canada. Mr. Speaker, I hope that the government will consider this suggestion favourably.
I regret that I feel obliged to criticize so much the policies of the government, but when a government like ours, that is a liberal government with a small "1", accepts conservative recommendations with a small "c", I believe that we must reconsider our position.

I am disheartened by this acceptance of a recommendation from the official opposition. Urban Affairs was doing a great job for Canada. It has the potential of saving hundreds and hundreds of millions of dollars. This shortsighted step of terminating this ministry will end up costing us untold millions unless the government decides, upon reflection, to give the full power that Urban Affairs had to Public Works and allow that ministry the power to influence the co-ordination between levels of government and between ministries which is so necessary to help in improving the quality of life in the future.


Sinclair McKnight Stevens: On a point of order, Mr. Speaker, the speech of the hon. member for Laprairie (Mr. Watson) has been intriguing. I wonder if he would accept one question with a view to clarifying something.


The Acting Speaker (Mr. Turner):: Due to the fact the hon. member's time has expired, unanimous consent would be required in order for the hon. member to accept a question. Is there consent?


Some hon. Members:: Agreed.
March 5, 1979


Sinclair McKnight Stevens: I thank hon. members. My question is simply this. In view of his burning criticism of the government with respect to its actions touching on the urban affairs department, may we expect some overt sign of this opposition in the form of his voting against the government or even breaking with the government?


Ian Watson: Seriously, Mr. Speaker, if there were a vote on the termination of Urban Affairs, I would not hesitate to vote against the government. I support this bill because there are a lot of good things in it. This bill has nothing to do with the termination of Urban Affairs which will, unfortunately, be terminated by an order in council without consultation with anyone.


Sinclair McKnight Stevens: My further question is this. If we can arrange for a confidence vote on the question the hon. member is referring to, will he agree to vote against the government?


Ian Watson: Mr. Speaker, I find that question amazing. My criticism of the government is that it has accepted the recommendation of this hon. member, the former mayor of Toronto and others on his side, who apparently have had it as a policy of the Conservative opposition for at least a year, if not more, to abolish Urban Affairs. My criticism is that we followed their advice.


Mr.   C.-A. Gauthier@Roberval: Mr. Speaker, I am pleased to deal briefly with Bill C-29 which is before us. As I was listening to the previous speaker, I could not help thinking what nonsense we are subjected to in this House of Commons when he suggested that the minister should restore the Department of Urban Affairs to life.
I had thought that everybody knew that if the minister had eliminated his Department of Urban Affairs, it is because it was interfering too much with provincial issues. But that is the way Anglophones think. Another member of the House claimed that we should need this department to indicate to the municipalities how they should administer their own affairs. I am flabbergasted and I am afraid that with a parliament with such opinions, we are not about to understand one another.
Mr. Speaker, in all the projects the government has put forward over the years in the area of housing, we must admit it has not obtained the success it had hoped for. And after all the cutbacks that this government has been trying to make lately in all sectors, more specifically in the social affairs sector, now on the fever of an election the government in a supreme effort tries to make Canadians believe that it has finally found the answer. This bill is a lot a fuss for nothing. Indeed, what does the government risk with this bill? What does it risk through this proposal as a whole?
I read the first part of the bill. I was not here when the minister delivered the first part of his speech. But I put it aside
Housing
at once because the minister was not dealing with the subject at all; obviously he was upset. He was upset by the vote that has been held and he lost his cool and used some pretty strong words. I shall not repeat them. Recently he wanted me to withdraw my words but I will not ask him to withdraw his. Next time, I suggest he behave in a more dignified manner even if he does not like the result of some votes. Indeed, I do not like to hear these kinds of remarks in the House.
But I found very interesting the second part of his speech with which I shall now deal. I was indeed saying: what is the government risking with this bill? It is risking backing mortgages and perhaps also having to pay out $5 or $10 a month for some tenants who will have trouble paying their rent with its proposal to grant 25 or 30 per cent to those who will spend more than 25 per cent of their income on rent. The real problem is that the federal government is operating in an area outside its jurisdiction, an area coming under provincial jurisdiction. 1 am still wondering why it is so stubborn as to remain in those areas when all the provinces are asking it to withdraw, to let them do as they wish and give them at the same time-


An hon. Member:: To get out!


Mr. Gauthier (Roberval):: Yes, it should get out and at the same time give back the taxation right it has taken. At the present time they have no choice but to provide the money because they have the power of taxation which they borrowed and have been keeping for 38 years. There is the difficulty. There is the problem.
I heard the hon. member say a while ago: Well, the federal government should re-establish they had the nerve to create a Department of Urban Affairs, imagine, when it is a well known fact that urban affairs come under provincial jurisdiction! Well, besides the fact that this is outside its jurisdiction, the government does not know anything about that because it is too far removed from it. It does not, like the provinces, live close to the authorities which are responsible for those municipalities.
The government is anxious to be forgiven for its illegal interference with provincial jurisdiction, and then it hands out goodies to prevent the taxpayers from shouting out their contempt. Why is this government refusing to transfer the powers of taxation to the provinces so that they may administer their affairs within their own area of jurisdiction? You have never seen a province interfering with federal affairs. You have never seen that. They respect federal jurisdiction but why do we not do the same at the federal level? Why not uphold the Constitution and the meagre rights the provinces were given? For the past 10 years, there has been a steady and increasing encroachment upon provincial jurisdiction. No wonder war has broken out between the federal government and the provinces. That is no wonder. Every Canadian knows that urban affairs, housing, house rehabilitation, like commu-

March 5, 1979
Housing
nity services, are constitutionally matters of provincial jurisdiction.
After snatching direct taxation rights from the provinces in a hypocritical and fraudulent way, this government is taking the initiative because it has the money; it collects, it has every spending power, to ask the provinces to share equally. Those were the taxation rights of the provinces, but they are told: Participate. We are going to use your money to pay for that but put up half in any case. That is all very nice. But it holds on to their means of collecting the necessary taxes. Mr. Speaker, that is the problem and the major cause of all those family quarrels. Add to that the way of redistributing the revenues of direct taxation, either through the Central Mortgage and Housing Corporation, project managers and all those who are appointed by the government to carry out projects-I was just talking to the minister this afternoon about that. I told him there were pretty bad things. I know the minister cannot control everything going on in those projects, rehabilitation projects, Central Mortgage and Housing Corporation projects and others where you have to qualify and where qualifying means being a Liberal. Well, Mr. Speaker, that I will not forgive. I am not accusing the minister here because 1 know he is not aware of that but things are going on that are unforgivable.
I have seen projects granted to people who had no use for them at all and I have seen other people who would have needed them but failed to qualify because they were probably Conservatives or Social Crediters. I call things as I see them. That must be brought in the open. I am here to say what is going wrong-that also helps the minister, I am sure he is going to keep his eyes open. I told him: "When you select a man like that, I understand that he is on your side, but select three of them and form a committee to prevent discrimination like that". I think that this would immediately clear up the situation and provide everyone with a bit of justice.
In his remarks the minister told us that the current housing programs undertaken in co-operation with the provinces are supplying 19,000 housing units a year, which, again according to the minister, is not sufficient and I agree on that. I also agree on the non-profit housing program. The government expects to build 30,000 units, and the minister adds that the program will be the responsibility of the federal government, the provinces, the municipalities and private or public organizations which may be involved in housing. First, I wonder if the government did meet with the provinces, if it did meet with those who are concerned, with those who are really responsible, if it had discussions with them, because once again as ever it seems to have followed the usual rule, that is to set up the whole program and later submit it to the provinces and say: "Take it or don't take it. If you don't take it, you won't have it; if you do take it, you must follow our rules and do what we tell you to do."

Mr. Speaker, they will have to mend their ways if they are to face the electorate in our provinces, and especially in the province of Quebec, because I can tell them people know what the Liberals are all about. They will get a surprise, not us. The government forgets they use three tax collectors for federal taxes, for provincial taxes and for municipal taxes. This makes for three tax collectors preying on the same taxpayer. The same taxpayer that will be taxed three times is the worker. Always the worker.
Programs are put forward, Quebec and other provinces put them forward in their jurisdictions, but in the final analysis, the worker pays-one, two, three, go! Three taxes for one area or one project. We may not be fully aware of this, but the taxpayer knows. He sees that. I would even say that all those parallel bureaucracies, we will have to get rid of. Each level will have to remain in its own area. The federal government in its area, provinces in their areas, and then only can harmony set in.
The bottom line truth is that the government recognizes it has no more money. The Central Mortgage and Housing Corporation has no more money either. So the government calls upon voluntary organizations, the private sector to hide its failure in housing. The minister suggests that low income people, single mothers, senior citizens will benefit from the program. Admittedly those groups will be able to find easy housing for some time just until the bureaucrats, the "taxers", decide otherwise. We know what goes on in low rental housing.
Senior citizens, as the minister suggested, will get 25 or 30 per cent to help pay their rents where they exceed 25 per cent of their monthly incomes. That is all right, Mr. Speaker, 25 per cent of monthly income, that looks like a nice grant. But what does that mean in actual figures? This is what I am interested in. What does that get us to? Let us take the case of two senior citizens, both getting the old age pension. A couple getting $600 per month in pensions and paying $200 in rent. If they pay a $200 rent on $600 per month, this means they will get nothing. No grant. He might as well not expect it, he will never get it! If his rent is $225 per month, he will get the enormous amount of $6.50 a month, as a tax credit to help him survive. That is the mouse brought forth by the elephant scheme of the minister. What about heating? The rent is taken in consideration. We talk about subsidizing the rent, but what about heating and the other maintenance costs? The new housing units accepted by the Central Mortgage and Housing Corporation all have electrical heating systems. I know people who had to pay over $800 for heating, last year, in houses accepted by the Central Mortgage and Housing Corporation, which were not properly insulated. The contractor probably had some friends working for the Central Mortgage and Housing Corporation. That happened before. But, there again, the tenant has to pay for all this. When you feel a draught while sitting by a window, you know there was no insulation.
March 5, 1979

And this was accepted by Central Mortgage and Housing Corporation which, like others lenders still charges 10 per cent, 1OV2 per cent, 11 per cent, 11'A per cent interest. What about tenants' taxes, Mr. Speaker? I think that the best tax credit should be used to reimburse the municipal taxes paid by tenants in order to avoid double taxation.
If the government reimbursed municipal taxes to tenants, and if we consider the situation of the single family dwelling owner, it is even worse, Mr. Speaker. For years now, we have been urging this government to allow the small home owners to deduct their school and municipal taxes from their income tax and to grant a tax credit to welfare recipients because some home owners are on welfare. Someone earlier was blaming the Progressive Conservative party for asking for a reduction of municipal taxes, but we have been blamed for that for the last 17 years. Yes, 17 years! I really wonder why the home owner is denied a tax credit for municipal and school taxes, for the interest paid on his mortgage interest when it is granted to multiple unit dwelling owners.
Let us suppose that 1 decide to built a 40-unit apartment building, I shall be allowed to deduct from my income tax the interest on my loan plus school and municipal taxes. But this tax relief is denied to the family head who builds a house, the rationale being that he builds for himself. But he does not, he builds for his wife and his children. If he were alone, he would not need a house, he could board somewhere. I think that someone should be entitled to deduct municipal and school taxes as do those who build apartment buildings, it should be him. I fail to understand the logic of this government when it says: "You must not go over that level for fear of becoming too strong and a threat to us. Such reasoning has to be prompted by a desire to squash the low income people. But it does not do them any harm to put up the financing for they are the ones who supply the campaign funds. I call this discrimination. Those who do not pay any income tax are to get a tax credit? Those on welfare already get an allowance for their rent. They should build themselves small inexpensive houses and use this allowance to make their payments. But for God's sake, let us give them a tax credit, and also to the tenants. By the way, the tenants get one from the school board now. This should be in the form of a tax credit which could be surrendered to the municipality since the municipality obviously needs adequate revenue.
In behaving the way it does, Mr. Speaker, the government acts as if it is only interested in making money, in having the poor help increase its own wealth and make the poor even poorer.
The minister says that the National Housing Act is amended to increase the construction of public housing by non-profit organizations. Once again, his objective is praiseworthy, I agree, I support his proposal, but how can that objective be
Housing
reached? By paying once again for four houses to acquire one. If we apply to financial institutions, if we use means made available through the government, even the Central Mortgage and Housing Corporation, which is a government organization, will make you pay the price of four houses to get one. The minister would have a fine opportunity to follow the example of the people. Since non-profit corporations are involved, all voluntary workers who will be unpaid, that is the group that will build low-rental accommodations, could take advantage of interest-free funds. No, they will have to apply to the Bank of Canada exactly as if they were needy countries. There are also needy families and areas. We need not go to other countries to see people in need, Mr. Speaker, there are lots of them in Canada. I think that if the Bank of Canada can help others, it can also help the people of this country.
I will not insist on that lest someone starts talking about the floating dollar. Fortunately the Minister of Finance (Mr. Chretien) is not here with his floating dollar or rather his sinking dollar. We cannot bring the dollar back to the surface without upsetting the large financial institutions. The minister also extends the invitation to private investors but when I hear that I wonder whether the government is still willing to keep its word. Again, I blame the minister, but I should not blame him. I should blame the developers because I have evidence about people who took a risk in the private industry, who built 40 units because they had been promised benefits of $80 to $85 per unit and who received only $42 per unit once the work had been done.
So I suggest if we continue to invite private enterprise this way, private entrepreneurs will stay home. And I urge them to stay home as long as the government fails to keep its promise. It gave $89 to others and then only $42 to this one, why? Let us find out. But I talked to the minister about this and I hope he will be fair to him and give him the same amount he gave others, since he made the same effort; he even made more because he was forced to build in winter, which cost him around 10 to 15 per cent more. And when he woke up the next morning with only $42 instead of $89 in rebate, I suggest, Mr. Speaker, this does not encourage future owners at all.
Mr. Speaker, the minister also said he will encourage cooperatives. I do not know what he did for co-operatives, but when he said that, I was reading a press report from today, March 5, and I quote:
Mr. Ouellet wants to kill Quebec's housing co-operatives.


Hon. Andre Ouellet (Minister of Public Works and Minister of State for Urban Affairs):: That is not true.


Charles-Arthur Gauthier: The minister says it is not true, but I am not the one who said so. Frankly I wonder what happened because here is what we can read in that article:
In an interview with the Journal de Montreal, Mr. Jean-Guy Lague, the spokesman for Quebec housing co-operatives, stated "that the CMHCs new

March 5, 1979
Housing
programs go directly against the basic principles of the present movement of housing co-operatives".
"If the minister had wanted to kill Quebec housing co-operatives, he could not have done any better," added Mr. Lague.


Ian Watson: That is PQ propaganda.


Charles-Arthur Gauthier: Mr. Lague is not a PQ partisan. The hon. member is wrong, because whenever anything happens they yell PQ. You have unemployment, they blame the PQ. People are getting sick, they blame the PQ. You have smallpox and they blame the PQ. That is a sickness now. If you need a psychiatrist, you will be sent to Dr. Laurin .. .


André Ouellet: Does the hon. member know Mr. Lague?


Charles-Arthur Gauthier: He is not a PQ member.


André Ouellet: Does the hon. member know him?


An hon. Member:: He must be a Social Credit supporter.


Charles-Arthur Gauthier: I will not say anything because you will be influenced again. Nor I will say he is a Progressive Conservative because you will be influenced again. I continue the quotation:
The housing co-ops are not a new issue. Indeed for several months the Quebec housing co-ops representatives have been trying in vain to meet with Mr. Ouellet.
That is strange because we get to see him any time we want. Simply get him upset a little bit and there he is. I continue:
But the minister delays rendezvous for weeks and weeks. According to that spokesman, the autonomy of co-operatives is not respected when it comes to selecting members and criteria used 10 determine an equitable rent structure.
They also have rental problems, Mr. Speaker.
This new program gives a deadly blow to home rehabilitation by co-op members or working parties. The lower rehabilitation costs as a result of the work performed by co-op members do not reduce the rent but rather the CMHC subsidy.
I am getting close to the point, Mr. Speaker. It seems that when the co-op members volunteer to work on the project, the subsidy is reduced, as he explains, and I quote:
The lower rehabilitation costs as a result of the work performed by co-op members...
-voluntary work-
... do not reduce the rent but rather the CMHC subsidy. It is a program which favours new conduction, unsuitable for buyers of older homes in need of rehabilitation and more suitable to the needs of other provinces. Generally speaking, it is a discriminatory program towards Quebec. What Mr. Ouellet proposes to the Quebec co-operatives are actually "subsidies to the banks" . ..
In that respect, I fully agree with him because those who will benefit from that are precisely the banks, because they will make loans and will never lose a cent. It is the government which guarantees every cent of every mortgage dollar. Therefore, it is true that these are actually subsidies paid to banks. I go on with the quotation:

... it is to reinject co-operative housing into the main stream of the inflationary market, it is to base the development of co-operative housing on the incomes of certain groups of people. In view of the minister's contempt for their proposals, Quebec co-operatives are requesting another meeting with him to ascertain once and for all how these new federal programs will be implemented in regard to the specific features of Quebec housing co-operatives.
Another article refers to a major fight, and I will not have time to read it all because my time is almost expired, but I simply want to say to the minister that if there are falsehoods in the release, I hope he will schedule another meeting, because these people are complaining that they cannot meet with the minister.


André Ouellet: I have met with them.


Charles-Arthur Gauthier: In any event, I told them that if they cannot see him, they can come and see me, and that I know how to arrange a meeting.
Mr. Speaker, the minister asked me for suggestions this afternoon; the best thing I could suggest to him would be to reduce interest rates or, particularly for non-profit projects, to recover only administration costs. This we can do, if we only want to.
Should the government take these means to give satisfaction to senior citizens and low income earners once again, should elections be called, it would be presentable in the province. It must act fast however because the election is getting near and we would like it to be somewhat presentable. We are, for our part, doing our best always, and we will again do our best in the next election. Our organization is such that we can make it known under all its aspects, but I hope they will act before the election is called.


Mr. Deputy Speaker:: The hon. member for Saint-Hyacinthe (Mr. Ostiguy).


Benno Friesen: On a point of order, Mr. Speaker, I cannot be here for the rest of the week and my name is on the list. I apologize to the hon. member for Saint-Hyacinthe (Mr. Ostiguy)-


Mr. Deputy Speaker:: Order, please. As far as the Chair is concerned there is, in principle, no list; every member has to rise to seek the floor and the Chair has already recognized the hon. member for Saint-Hyacinthe. I understand the hon. member's preoccupation. This debate may continue for some while-I do not know what may happen in the House. The hon. member for Saint-Hyacinthe may not be long, and there is a possibility that the hon. member will get an opportunity to speak afterwards.


Mr. Marcel Ostiguy (Saint-Hyacinthe):: Mr. Speaker, I should like to remind my colleague opposite that I will only
March 5, 1979

speak fifteen or twenty minutes. I think that he will have enough time to speak following my comments on the bill.
For several reasons, Mr. Speaker, I would like to support the amendments to the National Housing Act proposed in that bill. I heard my colleague opposite, the previous speaker, say that the bill would have bad implications and that it would be misunderstood by the people. This has surely been already pointed out, but I would like to remind him of some statistics recently provided during a Gallup poll which indicated that in 1963, 76 per cent of the people were satisfied and that today 86 per cent of the people are satisfied with the policies of the Central Housing and Mortgage Corporation. In the province of Quebec, 95 per cent of the people are satisfied while 5 per cent are not.
I believe that these recently published figures show that Central Mortgage and Housing Corporation has done a lot for the building industry and the development of Canada. Indeed, I believe that it represents a logical way to deal with the whole area of housing problems. I am especially pleased to see that this bill has retained one of the most important measures ever implemented in Canada in this area, the Residential Rehabilitation Assistance Program better known as the RRAP.
I am also happy, Mr. Speaker, to see that the restrictions imposed upon this program have been abolished and that it will no longer be limited to certain designated areas. If this bill is passed, as I am sure that it will, Mr. Speaker, all Canadians will be able to benefit from the assistance granted under the RRAP. Under the terms of this program, the available funds will no doubt help to meet the most urgent needs of Canadians throughout the country. I am not surprised that the RRAP has been received so enthusiastically and spontaneously by Canadian as a whole.
I was told that since this program was established in 1973, Central Mortgage and Housing Corporation has helped in the rehabilitation of approximately 20,000 dwellings a year in Canada. I hope that this figure will increase as the program is expanded and municipal authorities become more familiar with it. Since my election on October 16, just four months ago, my constituency office in St. Hyacinthe has been visited by a great many people asking information about these programs. I could also tell the minister and the Central Mortgage and Housing Corporation authorities that there is perhaps a lack of information in rural municipalities, who are informed either through the county boards or by material and letters sent to the mayors or the secretaries of these municipalities. I believe that it would be a good thing to familiarize people with Bill C-29 now under consideration.
We must not forget however that housing rehabilitation is a long-term project. About 2 million Canadian dwellings were built before the end of the Second World War. Some of these dwellings are still solid enough while others are not worth being repaired. A basic renovation would do for many of them, perhaps half of them, and would extend their life for many
Housing
years. What I mean, Mr. Speaker, is that a task of such a scope cannot be realized overnight, nor even within a year. The number of houses which can be renovated each year depends not only on the funds that the federal government will be able to allocate to these programs but on the attitude of the municipal organizations which will administer them and of course of the qualified and unionized labour which will be available and capable of making the necessary repairs and restoration works. Undoubtedly the number of renovated houses in Canada is rising each year. I am certain that the government of Canada will go on playing a leading role in this growing industry which is so important for our country. One recognizes more and more in Canada and everywhere in the world that the rehabilitation of dwellings is of capital import. If we think of the energy crisis, of oil and gas restrictions, we see that we must take all possible steps to look after those old houses which, when they were built, did not have any of the insulation which is available to us in the 1980s.
In fact, Mr. Speaker, people in increasing numbers consider that it is better to try and maintain their house and prolong its life expectancy than to take it apart and start from scratch. Renovation and preservation are both important factors of the federal government's conservation policy which calls for the proper administration and recycling of our non-renewable resources. To make a house last longer instead of starting from square one will result in major savings in terms of energy, material and money. And that is more and more what people are seeking both in Canada and elsewhere. In other words, Mr. Speaker, people are more concerned with providing adequate lodging than reaching set goals for housing starts every year.
Mr. Speaker, ever since the end of World War II and up to these past few years, we were mostly concerned with the production and construction of new housing. The Central Mortgage and Housing Corporation was created in 1946 to help us catch up with the backlog accumulated during the depression and war years. But times change and so do the housing needs of Canadians. That factor, Mr. Speaker, associated with many others will mean that fewer new housing units will be needed each year. As we all know, we will probably need only about 20,000 housing starts a year around 1985, as compared with 30,000 today. The decrease in the population growth will also mean the population will be made up of a higher percentage of older persons.
At the same time, people are increasingly putting off getting married and having children, and children are leaving home at an earlier age. As a result of those trends, Mr. Speaker, families are growing smaller and couples without children are becoming more numerous. There will be a resulting exodus from the suburbs and big family houses to downtown areas where housing is older and in greater need of renovation. The increasing cost of gas and decreasing energy resources will in addition speed up this movement towards the city by pushing up the cost of daily commuting.

March 5, 1979
Housing
Mr. Speaker, all those demographic trends and economic projections, as well as changing social values, lead one to believe that rehabilitation will become increasingly important, at least until the end of the 20th century. I am very happy indeed that the government, by introducing these changes, recognizes the importance of renovation programs and the conservation of houses, and that it should have reaffirmed its intention of continuing to support those programs in concrete ways as it does through Bill C-29.
A few words now, Mr. Speaker, about non-profit corporations. I feel that through these assistance programs for cooperative housing projects and non-profit corporations, this bill underlines the needs of those for whom buying decent housing is a must. I am sure, Mr. Speaker, that once the bill is passed and implemented, those programs will do much in achieving our objective for people of limited means. I am particularly happy with those programs which merge private capital with federal subsidies, and so achieve an efficient association of the resources of both the private and the public sectors. At this juncture, those financial arrangements are particularly important as government expenditures must be severely restricted for all programs it is setting up.
About those non-profit organizations, Mr. Speaker, I must say that in a riding like Saint-Hyacinthe with some 37 municipalities, already several municipal councils, several non-profit corporations have been formed and have come to ask me for information about those projects scheduled for 1979, having heard that under the new Bill C-29 they could have the benefit of a 100 per cent loan guarantee for non-profit corporations and have to pay only 2 per cent interest whatever the current rate of interest at the time the contract is signed. I say to you, Mr. Speaker, that in a riding like Saint-Hyacinthe, at least five municipalities are already interested in that proposal, and I believe the publicity about this bill will have to be toned down for a while because we will surely not be able to have them all go ahead during 1979-80. I also say to the minister that projects will be welcome on the south shore of Montreal.
We also have in the town of Saint-Hyacinthe itself, Mr. Speaker, a 137-unit project under completion which should be opened in the month of March. The municipal authorities in Saint-Hyacinthe are asking us to apply for a new project because demand being so strong for retired people, this 137-unit project is already filled to capacity.
Mr. Speaker, 1 must say also that the housing policy set out in this bill is much wiser, fairer and much more efficient than certain irresponsible proposals put forward by members of the official opposition. I am thinking for example, Mr. Speaker, about the idea of making mortgage interest and municipal taxes deductible from taxable income. That proposal is in my opinion irresponsible because it is being introduced at a time when the government with the support and the approval of business is making big efforts to reduce spending and deficit. And members opposite chose precisely that time to put for-

ward a measure that would cost hundreds of millions of dollars and would actually benefit only a very limited group of people who are far from being those most in need of help.
Out of the seven and a half million families in Canada, about three million rent either out of necessity or by choice. The tax deduction being proposed by certain members of the opposition will be of no use to that group in which you find most needy families. Approximately 2.5 million Canadians are home owners paying off mortgages. Among them are not only low income Canadians who were assisted in purchasing their homes but also the richest people in Canada.
Mr. Speaker, I think the bill before us provides assistance to all Canadians, because it gives them the opportunity to buy good homes at a price they can afford. Given the present economic situation in the country, this legislation is socially equitable and financially sound. In my opinion, Mr. Speaker, it is highly preferable to the inequitable, irresponsible, discredited yet revived proposal put forth by members of the opposition.
Mr. Speaker, there is a saying to the effect that activity in the building trade is a sign of prosperity, yet when we look at the latest figures for housing starts, we see that there were only 227,667 housing starts in 1978 as compared to 254,725 in 1977. The number of completed homes in 1978 came down to 246,653 units compared with 251,789 in 1977. So there has been a decrease in construction in 1978, and we must do everything possible, Mr. Speaker, to boost the construction industry in the province of Quebec as well as in the whole country.


Benno Friesen: Mr. Speaker, I have enjoyed listening to this debate, particularly the remarks of the hon. member for Laprairie (Mr. Watson) who, in true Liberal fashion, came down four square solidly on all sides. On the one hand he is in against the bill, and on the other hand he is in favour of it. He did not like the fact that his leader, the Prime Minister (Mr. Trudeau), issued a fiat to the effect that this department will be abolished, but he is going to vote for the bill anyway. The hon. member for Roberval (Mr. Gauthier) was right when he said the government had no business in this business in the first place. Over the past ten or twelve years, experience has shown that it should never have gone into it. There are a lot of sorry home owners in Canada who have had the disagreeable experience of buying homes under some of the more unfortunate schemes this department put together.
The intent of Bill C-29 was well capsulized by the hon. member for Rosedale (Mr. Crombie) who has a talent for compressing a comprehensive subject into a very few sentences. On March 1, as reported at page 3742 of Hansard, he said:
Essentially, the bill does three things. First, it disentangles the mess which the government has created in housing at both provincial and municipal levels over the last seven years; second, it cuts out the government's Financial commitment
March 5, 1979

to housing and urban affairs and, third, it winds down the Ministry of Urban Affairs after its death was announced in 1978. That is really what the bill does on behalf of the government. It disentangles, it cuts losses, and it winds down the ministry.
In a nutshell, that is what the bill is all about, but that really does not tell the history of some of the experiences people have had with this department.
I remember, when I came to this House almost five years ago, listening to the former minister of housing and urban affairs who is now the Minister of National Defence (Mr. Danson). Every year he would give statistics for the new housing starts-20,000, 30,000-they all looked good and it sounded as if the needs of the Canadian people were being met. It was evident that he was very statistics conscious, as I am sure the present minister is. It took two or three years for the reactions to those statistics on AHOP to come in. The big problem with AHOP is that it is not a "people" program. It was just another public relations gimmick, made to sound great, fun to end load the thing, to make sure that people could afford the downpayment. All the new housing starts to meet the needs of the people would make the government look good, and actually its purpose was to meet the public relations needs of the government. It took three or four years for us to find out what was going on. While this bill gets rid of the original department, it does not get rid of the problem, Mr. Speaker.
Some of my constituents who talked to me about the AHOP program showed me a brochure from CMHC which said that the government inspection would look after things. I notice that the bill does not change that. Clause 1(a) reads as follows:
(a) in accordance with this Act make approved loans on such security in favour of the lender as is provided for by this Act;
Mark those words, Mr. Speaker, "in favour of the lender." That is why I say it is not a people program.


An hon. Member:: It is called free enterprise.


Benno Friesen: The hon. member from Saskatchewan, who has never had a housing problem in his province because nobody ever moves there, wants to educate everybody else on what should be done about housing. I understand there is zero population growth in Saskatchewan. I would say that the lenders, the trust companies, mortgage companies and the banks, are big enough to look after themselves. Surely the Royal Bank, the Bank of Montreal or the Bank of Nova Scotia and all the trust companies have enough resources to supply their own inspectors.
The first-time home buyer who reads that brochure is starry eyed at the prospect of moving into a new home and thinks he is going to be protected. It is not the home buyer who is protected by that inspection, Mr. Speaker, it is the lender, and those lenders are big enough to look after themselves. The bill does nothing to correct that and I think the minister ought to change it so that it does. If inspections are necessary, and they are, why should they not be done on behalf of the buyer rather than on behalf of the money lender?
Housing
The second area in which this is not a "people" policy is that a ceiling is put on the price of the homes, especially in AHOP projects. At first blush that looks good. A buyer does not have to pay more than $47,000 for a home and that seems to be an advantage to the first-time home buyer. While it imposes a ceiling on the price of the home, however, it in no way imposes a ceiling on the cost to the contractor. It costs him just as much to buy the lumber, provide the services and pay the subtrades. The bill does not impose a ceiling on the cost of production, but only on the cost to the purchaser.
If the contractor is to meet that cost price squeeze he must look for ways of doing it, and it is likely that he will try to get money above the ceiling. Of course this is not legitimate.
On Saturday morning when I was in my riding I received a call from a constituent who claimed that he had not slept all night. The evening before he had signed an agreement to purchase an AHOP home. After he signed, the realtor slipped another piece of paper to him on which was written "lot differential fee". It turned out that in this project the original plans had not been good enough to suit the municipality and the developer was asked to upgrade them, which of course cost more. In an effort to recoup he put this piece of paper before the buyer and told him not to show it to his banker, otherwise he might not approve the mortgage.
I asked for a copy of the documents which I said I would take to the minister, as I did. To the credit of the former minister he said this was not right, and got in touch with his officials in Vancouver regarding the matter. Before the day was out, that project was frozen and about 35 home buyers had their money refunded.
When a ceiling is put on the price of the home, with no way of controlling the cost to the contractor, he is going to try to make it make it up in some other way. He can make it up by cutting corners. That is fine, as long as they are not cut so much as to produce a shoddy piece of merchandise.
The former minister was so interested in statistics that he put pressure on CMHC officials to get the contractors involved in this program. They were supposed to get out and build the homes. The result was that the good reputable contractors who had been in business for a long time and were concerned about their reputation and about ethics, stayed away from the program for the first two or three years. Meanwhile the quick operators moved in, put together a land assembly and, because there was no proper surveillance, they cut costs.
In a project in my constituency there were about 35 homes. I have shown the minister a video tape of some of the things that are wrong with it. He says it is too bad, that it should not be that way, and indicated that his officials in Vancouver say it is not right. It does not look as though the people concerned are going to get anything out of it, however. They have lost thousands of dollars in these homes but are not going to get anything from the government. I visited those people who bought some of those AHOP homes, Mr. Speaker.

March 5, 1979
Housing
In one case I know I hit my head on the dining room chandelier near the fridge. Would you believe that in a number of cases there was an electric splice box with bare wires? These were located behind medicine cabinets directly above the sinks. Just for kicks someone said, "I bet I can short that out." The man took a screwdriver to one of the boxes and blew out the fuse. This was a CMHC inspected home. Then there were water problems to contend with. These included seepage of water into the basement and water running into the basement instead of away from the house. The design did not call for closet doors, and there were none. Every closet door was a different size. Now it costs the home buyer twice as much, perhaps even three times as much to buy closet doors. In another home one had to open the oven door in order to get the cutlery drawer open. The list goes on and on.
The government inspectors were not doing their job. The former minister was so anxious to get statistics in order that he could have his 20,000, 25,000 and 30,000 new homes each year that he sacrificed the home buyer in the process. What we had was a series of companies throughout the country which were forming new companies to develop one project. They would then build all the homes and move out, taking the assets from the company and finally dissolving it, so that there was no way the homeowners could ever touch that company again. This happened because the minister was in a hurry. We have CMHC saying that they will secure the mortgage. But they made sure those homes were just good enough so they would last the life of the 25-year mortgage. Who knows what will happen after that?


Mrs. Pigott:: Instant slums.


Benno Friesen: Instant slums, right. Why were there not more inspectors? I understand from officials that they could not hire enough of them, first, because the growth factor was so large and, second, because the turnover rate in the inspection department was so great they could not train people fast enough to take care of the inspections. But, the minister got his statistics. Is it any wonder that as a result of AHOP now, after five years of production, out of 130,000 AHOP units built between 1973 and 1978 we have 53,000 units unsold? This amounts to roughly 35 per cent to 40 per cent unsold. Who knows how many of them are now vacant because of midnight movers? People said that the payments for the first five years were going to be subsidized, and in the next five years they would have to make that up. But in the next five years the house has already depreciated, so why pay higher payments for a depreciated house? And the midnight movers move in, and the 'for sale' signs go up.
In 1978, 10 per cent of the owners of AHOP homes defaulted on their payments. This compares with one half of 1 per cent of conventional mortgage home owners. That is the human problem. The minister can look at the statistics, and the House can study the statistics. That is one thing, but what about the pain and the anguish of those people who, for the first time, said, "I am going to have my own home."? They

move into their dream home and those dreams are shattered within two years. For about three years there is one project on which I have worked with these people and with the minister and got zilch satisfaction out of it. The latest thing which the minister introduced is a kind of insurance program for new home buyers. That insurance program is about five years late. Incidentally, that insurance program is a confession of failures in other programs.
The other indefinable, intangible problem that this massive failure has created is the problem of reputation. What must it be like for someone who lives in an AHOP home in what has already been described as an AHOP district when he has to try to hide from other people that he lives in an AHOP project?
Reputable contractors have been coming on stream and they have been sharpening their pencils. They have said, "Look, if I do this and this, I think I can put out a new product within the price the ceiling establishes." So there are a lot of good AHOP projects around. The people who have bought in these projects are satisfied. They have a good reputation, except blurred across that good reputation are the other AHOP projects that people want nothing to do with. These include homes that were bought for $47,000 and are now worth perhaps $45,000, $44,000 or even $43,000. These homes were for first time home buyers. People not only had to come up with the down payment, which was hard to come by because obviously this program was designed for low income home owners, but frequently they had to borrow that down payment either from the bank, relatives or friends. Once they are in these homes they have to borrow more money for upgrading purposes so the houses will look the way they were supposed to look in the first place.
There is this mixed picture of good AHOP projects, mediocre AHOP projects, and poor AHOP projects. There is blurring in the public's mind. Where is the home buyer at in a situation like this? What do we do?
Now that the program seems to be working, as this government so often does, it has cancelled the program. That is it. It did this with the assisted rental program. Then it moves into another new area. The government's new alternative to AHOP is a graduated mortgage payment. It simply says that if one cannot afford a steep down payment, "We want to help you with that and temporarily ease the burden." In other words, in the first five years the burden will not seem quite so bad, but in the second five years it will get worse.
The government has ensured that inflationary pressures will continue. It is building on inflation on the one hand. In all the other programs it is saying, "We are trying to fight inflation, we are going to reduce inflation from 9 per cent to 7 per cent to 6.5 per cent." The Minister of Finance (Mr. Chretien) is continually saying, "We are going to cut it down." But in a program like the graduated mortgage payment program it is saying, "Inflation is going to be here a long time. We are going to help you fight inflation by helping you with this graduated mortgage payment." By so-called levelling out these payments it is increasing the inflationary pressures for these people who are buying these homes.
March 5, 1979

I note with interest comments of an earlier speech in this debate where the speaker quoted one of the economists in this country. At page 3746 of Hansard for March 1, 1979, it reads:
Administered by the CMHC, GMP's are designed to give a house buyer one of the major advantages already provided by AHOP during the first five years of a graduated payment mortgage, monthly payments are much lower than a conventional mortgage would allow. From then on, payments are stepped up gradually until after the tenth year, when they reach a plateau.
The economist was a good man with figures, and he whipped out his pocket calculator. He found out that this was not such a great deal for the home buyer. As he said, the unpleasant, less obvious fact is that over the life of the debt the graduated mortgage payment will cost the borrower $9,324 more than the standard mortgage would, $105,024 compared to $95,700. As the speaker said at that time, the man who buys this mortgage borrows $35,000 and he pays back $105,024. Who needs that kind of help? Not the first time home buyer.
The economist goes on to call this permadebt. He will never get out of debt. It used to be that a man's home was his castle. It is now the case that the government is going to make sure that a man's home is somebody else's castle. The home buyer will never look forward to the day when he can own his own home.
I do not know that we can afford in this country to encourage a policy of debtorship. I thought in this country we were proposing policies of ownership, not debtorship, but the government seems to insist on wanting to lay the burden on those who cannot afford it so that they will be perpetually in debt, never seeing daylight. It believes in debtorship, not ownership.
A number of government members have criticized the Conservative plan to introduce deductibility of mortgage payments and home owner taxes from income tax.


Jean Elizabeth Pigott: They just wish they had thought of it first.


Benno Friesen: That's right, they wish they had. Now they are fighting a rear guard action and spending all their time trying to find fault with something they wanted to promote previously. That is not easy.
The latest gimmick is to say that members from both sides of the House visited Washington where everyone was against the program. I lived in the United States for about seven years and I remember the home owners talking about that. There was not one who was not claiming it on their income tax. They thought it was the greatest thing to happen since sliced bread. At least it led to home ownership.


Mr. Hare:: And early.


Benno Friesen: As the hon. member for St. Boniface (Mr. Hare) says, it leads to home ownership early. There were people in Washington who were against it, the same type of people as those in Ottawa who are against it, those in the department of HEW, the housing department. The bureaucrats think it is their God-given right to collect all the taxes in the country and to be the omniscient dispensers of tax money
Housing
in programs which they design, programs which they believe are infallible. In Washington, as in Ottawa, they believe they know best how to spend the tax dollars.


Jean Elizabeth Pigott: They get advice from tax lawyers.


Benno Friesen: That is right, those who specialize in that kind of mentality.


Jean Elizabeth Pigott: They make a lot of money.


Benno Friesen: That's right.


Mr. Benjamin:: How much help do you need?


Benno Friesen: I will take all the help I can get from the hon. member for Ottawa-Carleton (Mrs. Pigott) because it is good. I don't mind. The Liberals are saying this does not work well. When something has worked for 30 or 40 years in the United States and they say it does not work, I wonder about their rationale. We are making a proposal to the people of Canada. So that those who need it most will benefit the most, all those up to a level of $50,000 will be able to deduct their mortgage interest rate from their income tax.
I just finished a survey in my constituency. One of the questions I asked was. are you in favour of being able to deduct housing interest payments and property taxes from your income tax? Surprise, surprise, 81 per cent of those who responded were in favour.


Mr. Johnston (Westmount):: I love it.


Benno Friesen: There is one of those rich Liberals who will make use of this. 1 do not think the minister of amateur sport should get involved in this. She has not yet solved the coastal transportation problems. Therefore, she should not get into the housing debate.


Mrs. Campagnolo:: You had better stick to AHOP.


Benno Friesen: I am sorry AHOP ever came into Surrey.


Iona Campagnolo: Ask your mayor.


Benno Friesen: I have, and don't think we haven't been talking about it. As a matter of fact, the whole GVRD looked at the AHOP program and you know what they thought about it. This is the minister who said she was going to resign if in 90 days the transportation problems along the northern coast was not solved. She must have invented the metric calendar because that 90 days was up three years ago and she is still hanging around.


Iona Campagnolo: Go back to Surrey. They don't want AHOP in their boundaries.


Benno Friesen: She is now taking the expertise she gained solving all the northern transportation problems and is investing her expertise in Loto Canada where she has managed to lose $13 million. Now she wants to help in housing problems.

March 5, 1979
Adjournment Debate
Members of this House, I do not think we need that kind of help from the minister of amateur fitness.
The Liberal members want to draw up a list as long as your arm listing all the reasons the program we have devised will not work. Although they are against it, millions of home owners across Canada are in favour of it, and they are going to see that we have a chance to bring about that policy and provide them with the kind of help for which they are looking.


Jack Hare: If there is ever an election.


Benno Friesen: That's right. There is another suggestion that I think is interesting. Something like 400,000 home owners in this country spend over 30 per cent of their income on housing.


Donald James Johnston: They own homes though.


Benno Friesen: Can they afford them? The CMHC guideline states that you should never spend more than 25 per cent. The government is breaking its own guideline and allowing CMHC mortgages to people paying more than 30 per cent of their income. There are something like 800,000 home owners who spend over 25 per cent of their income on housing.
We have a situation where 1,200,000 home owners in this country spend more than 25 per cent of their income on housing. We in the Conservative party have a solution to that problem. If the Prime Minister gets the nerve to call an election we will be able to present that solution. May I call it ten o'clock, Mr. Speaker, so that I can finish tomorrow?



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Ray Hnatyshyn (Saskatoon-Biggar):: Mr. Speaker, I rise in connection with questions I raised last Friday in the House during the question period with respect to some of the difficulties being experienced by our grain transportation system. I know that we often rise in this House for the purpose of trying to get better answers to some of the questions we put in question period, but I am in the awkward position of having taken the exceptional step of giving notice of my intention to ask a question, explaining to the minister precisely what I was going to ask, and having the parliamentary secretary get up and tell me that he would take notice of my question. That is what I would term the ultimate in unsatisfactory answers as far as a question very important to western Canada is concerned.
Quite apart from the fact that grain transportation is vital to the farmer and an efficient grain delivery system is vital to people in western Canada, I should point out these are also vital to the total economy in Canada. I think the government should pay attention to that fact, and when people from western Canada ask questions about such very important topics, the government should understand how important they are to all of Canada. They are not local, parochial, or regional questions at all.
I want to deal this evening with that aspect of my question which related to hours of work regulations under the Canada Labour Code. You will know, Mr. Speaker, that under the amendments to that legislation which were passed in 1977, there has been ongoing consultation between the Department of Labour and western grain elevator operators with respect to whether elevator managers in western Canada are going to be exempted from the hours of work provisions in that legislation, or whether there is going to be some special arrangement for elevator managers, having regard to the unique and seasonal nature of their business in terms of the grain trade. I am sorry to report that there has been no resolution of that very serious matter.
The minister has been out in Western Canada meeting with representatives of elevator companies, pools and others. They have been very dissatisfied with the way in which this matter has been handled as far as the Department of Labour is concerned. In fact the secretary-manager of the Western Grain Elevator Association, Mr. Keith Grey, is quoted as saying that the Western Grain Elevator Association is totally dissatisfied with the proposed hours of work regulations for grain elevator workers. He said:
We are not happy with anything because we feel the managers are exempt and Labour Canada is taking a firm position in opposition of that representation, which we feel is not on sound ground.
The article in which that quotation is printed goes on to say:
He said the minister has met with the association on two separate occasions to explain why country elevator managers "cannot be totally exempt from the hours-of-work provisions of the Canada Labour Code."
"The bureaucrats are not concerned with political ramifications. If we cannot obtain an understanding with the minister through discussion, then we will have to go another route," Grey said.
In another interview Mr. Grey put his finger on the way this problem might be solved. He is quoted in the Western Producer of Thursday, March 1, 1979. The article in which he is quoted reads in part as follows:
A change of government in the next federal election would probably help the grain elevator industry receive a permanent exemption from federal hours of work rules for employees-
If the Progressive Conservatives win, "I think they are in tune with the concerns of western Canada," he said. "It could well mean a total exemption."
Mr. Grey went on to reiterate that the Minister of Labour (Mr. O'Connell) understands and is sympathetic to elevator company concerns about hours of work, "but he is getting bad advice from his bureaucrats". The situation is simply that federal proposals to end the exemption have been postponed several times, and the latest postponement came last February

March 5, 1979

15 when implementation was put off from April 15, 1979, to April 15, 1980. The article goes on:
Industry officials have argued that because elevator managers are paid both a base salary and some "incentive bonuses," hours restrictions and overtime would require a major revision of pay structures. It would also require an extensive monitoring and policing system.
I think the worst complaint of the people in the industry and of the people in western Canada is the indecision and lack of sensitivity of the government to the practical circumstances of the western farmer in terms of his relationship with the western grain elevator managers. These people, by and large, are highly industrious, highly efficient managers of western grain elevators, and they perform a very important and useful function within the community. They are available to farmers at a time of their greatest need. They are compensated in terms of incentive bonuses and are given time off to make up for the overtime they put in during the course of a busy season. Probably this is hanging over them as another obstacle to the efficient grain delivery system, so I ask the parliamentary secretary to give us some assurance, and to give some assurance to western Canadians and to the grain elevator managers with regard to the government's intentions, whether or not it is going to play around with the matter indefinitely, causing the kind of inconveniences which have been caused up to this point.
[ Translation]


Mr. Dennis Dawson (Parliamentary Secretary to Minister of Labour):: Mr. Speaker, I would like to extend my apologies to the hon. member for Saskatoon-Biggar (Mr. Hnatyshyn) for not answering his second question last Friday, but unfortunately, despite the generous 15 minutes' advice he gave to the minister's office, it had been impossible for me to grasp all the aspects in his question in order to give him a reliable and complete answer. I hope I will be able tonight to give him some elements of answer which will prove to his satisfaction. [English]
Since his appointment last year, the Minister of Labour (Mr. O'Connell) has had numerous discussions with representatives of the Western Grain Elevator Association on the hours of work question. The association is fully aware of his position regarding the need to ensure fair treatment of employees. He is also aware of the needs of farmers for extended grain elevator services during the planting and harvest seasons.
Consequently, the Western Grain Elevator Association and the grain services union have now been informed that the current exemption from the hours of work provisions of the Canada Labour Code for country elevator agents, managers and their assistants, due to expire on April 14, 1979, will be extended to April 14, 1980, at which time a modified hours of work regime will come into effect.
The new hours of work regime will take into account the interests of the employees concerned, the interests of farmers and the interests of the grain elevator companies, by providing
Adjournment Debate
for standard hours of work of 48 in a week and a maximum of 60 hours a week during the planting and harvest season, instead of the 40 and 48 hours respectively provided by division I of Part III of the Canada Labour Code.


REGIONAL ECONOMIC EXPANSION-INQUIRY WHETHER AGREEMENT REACHED WITH NEW BRUNSWICK ON ADDITIONAL DEVELOPMENT
Mr. Eymard Corbin (Madawaska-Victoria):: Mr. Speaker, last Friday, I asked the Minister of Regional Economic Expansion about the progress made in the negotiations with New Brunswick concerning a subsidiary agreement on so-called developing regions.
These regions include not only my riding of Madawaska-Victoria but also that of Northumberland-Miramichi and the regions of Grand Lake and Charlotte in southern New Brunswick which, as a whole, have not yet been covered by a special agreement as was the case in almost all other regions of the province.
The northeast agreement has been known for years and includes the counties of Restigouche and Gloucester. There was an agreement on the Mactaquac region, the agreement concerning the special zones of St. John and Moncton, the agreement on Kent county, and let us not forget the sectorial agreements on agriculture, forestry, highways and others which of course concern the whole province.
In the circumstances, it was perfectly normal that northwest New Brunswick should claim its fair share. However, I emphasize that my region benefited from the programs offered by the federal government through DREE, the Department of Transport, the Department of Urban Affairs and others. The regional airport, Assomption Crossing in Edmundston, the regional museum, McCain Foods, Nadeau & Nadeau furniture, Fraser plants and dozens of small businesses are just a few examples of a long list of achievements in which the federal government has been involved. However, there is still some basic work to be done and I shall deal with this tonight. There are the municipal infrastructures that are essential to a certain quality of life and conditional to our economic development.
The small municipalities which do not have a large enough tax base to provide a minimum of services are particularly deserving in this regard.
While the northeastern part of the province and urban areas in the south could benefit from generous federal-provincial development agreements, many northwestern municipalities either had to freeze their water and sewer system projects, for instance, or pay through the nose. The provincial government told them: You are wealthy enough, you are well off in the northwest.
3842

March 5, 1979
Adjournment Debate
My colleague from Northumberland-Miramichi (Mr. Dionne) and myself were opposed to these disparities being perpetuated in a province which was already underprivileged compared with the others. We urged the present minister to correct these aberrations and I believe that we have won the first 14 rounds of the match, thanks, I am glad to note, to the understanding and the generosity of the minister, and in spite of the stubborn resistance first shown by the province of New Brunswick which opposed the negotiation of this agreement.
We therefore developed, with the industrial boards of our areas and in close consultation with the municipalities involved, a series of projects and proposals which, if all were accepted, would greatly assist in our industrialization and job creation efforts, without however being a solution to all the problems. This does not mean that all the proposals contained in the draft agreement are equally good or urgent or that the federal and provincial governments have enough money to finance all of them. As usual, the federal government will pay the bigger share, from 75 to 80 per cent, and the province and the municipalities, the taxpayers in other words, will pay the rest.
Unlike certain provincial ministers who represent my area, I do not consider the federal government as an inexhaustible source of funds. I feel particularly distrustful of electoral promises made by provincial politicians who will deliver just about anything and unknowingly feed great expectations into the minds of local governments and communities. The very meaning of the words consultation and negotiation should be explained to these people. Furthermore, it is the provincial government which itself put a ceiling of $25 million on the contribution of the two superior levels of governments in the agreement which we are now negotiating. It is a lot or it is too little. It all depends on which side you are. As for me, Mr. Speaker, what is important is to get started and to reach an agreement as soon as reasonably possible. 1 understand that the federal and provincial governments agree over most of the proposals contained in the draft agreement and that the views vary on one or two projects only.
Orally and in writing I have asked the minister to sign the agreement for the projects on which there is a consensus even if it becomes necessary to add or modify certain aspects later on. The municipalities would like to know the intentions of the two levels of government so as to be able to take advantage of the pleasant season ahead. The minister knows fully well that it takes some time to call the tenders, to study them, to award the contracts, to purchase the materials, to hire the manpower and to get the projects under way.
In answer to my question, last Friday the minister said he hoped that the agreement could be effective as of the next fiscal year. It is also my hope and the Parliamentary Secretary, the honourable member for Malpeque (Mr. Wood), who is going to speak tonight on his behalf and who has been a member of the Atlantic Development Commission, is aware of

the problems of my riding and of the maritimes. I am quite confident that he will be able to provide my constituents and myself with an encouraging answer.


Mr. Donald Wood (Parliamentary Secretary to Minister of Regional Economic Expansion):: Mr. Speaker, I am happy to have this opportunity to respond to the hon. member for Madawaska-Victoria (Mr. Corbin).
In order to provide for special development measures in four New Brunswick regions which are lagging behind the rest of the province, negotiations are nearing completion with the province for the signing of a subsidiary agreement to provide assistance in overcoming intraprovincial disparities. I am aware, Mr. Speaker, that the hon. member has discussed this important subject as recently as this afternoon with the minister.
An examination of the distribution of economic activity reveals that each of the regions has a significant reliance on the primary sectors. Growth in the manufacturing sector has not been sufficient to absorb increases in the labour force. The four regions are the following: Northwest-the counties of Madawaska and Victoria; Miramichi-the county of Northumberland; Grand Lake-the counties of Sunbury and Queens; Charlotte-the county of Charlotte.
Rates of population growth in these regions have been typically lower than the provincial average. A contributing factor to the relatively poor population growth is the lack of employment opportunities in these regions. Both average income, and average earned income remain below the respective provincial averages. For the majority of the six counties, the gap is most pronounced for average earned income.
There is little to suggest that these regions, left to their own devices, will significantly alter their relative position vis-a-vis their provincial average. There exists a requirement to revitalize the various regional economies, and to encourage local growth and development. The proposed agreement will attempt to encourage such development by providing funds for specific projects which may have a particularly significant effect on the regional economies.
The agreement proposal has been formulated following a planning and public consultation exercise which has attempted to ensure that initiatives respond to public priorities. Special emphasis has been given to the views of local community business leaders. A series of meetings was held in June and July 1978 in order that development needs and potential could be discussed by representatives of government and those of the designated regions.
A major objective of the agreement will be to halt, and possibly reverse the long-term declining trend in employment and income levels. The proposed programs are intended to take advantage of resource and industrial development opportunities, and reinforce the growth potential of a number of selected centres by the provision of infrastructure assistance.
March 5, 1979


TRADE-GATT NEGOTIATIONS ON NON-TARIFF TRADE BARRIERS
Mr. Bob Corbett (Fundy-Royal):: Mr. Speaker, I rise to take part in this debate to follow up a question I put to the minister responsible for DREE, the Minister of Regional Economic Expansion (Mr. Lessard), on February 28, dealing with his knowledge of the current GATT negotiations. In his response the minister said he was not in a position at that time to report on the progress which had been made with the United States in relation to non-tariff trade barriers.
Unfortunately, time did not permit me to pose my supplementary question. It would have been in line with my proposed motion under the terms of Standing Order 43 for which I had earlier sought unanimous consent. It would have been: "Would the minister consider proposing regionalization schemes and negotiating subsidized exports so that provinces such as New Brunswick could benefit from the lowering of trade barriers with New England and become an attractive location for branch plants?"
I should like to reiterate, for the benefit of the House, that the maritimes and New Brunswick were at one time the hub of economic activity in Canada. It was only after the opening of large markets in central and western Canada that our economy began to decline. It is not the way of maritimers or of Atlantic Canadians to expect others to bear the burden of the social and economic stagnation we have experienced over the past number of years. We possess a good many resources, including people, to deal with our problems.
What has happened is that the Atlantic region and the maritime region have become a bit like a boat, adrift in the sea of economic stagnation, with a broken oar. There are all kinds of statistics to point out the fact that the maritime region and the Atlantic region are indeed a depressed area and, therefore, an area at which this government should take a strong look.
The government's approach has been through DREE and in that respect I give it full credit, although DREE has not solved the problem. It has been in existence for approximately ten years and, indeed, it has allayed our difficulties to some degree. I applaud the government's efforts from the standpoint of realizing that the maritime region does have a particular problem. I want the government to know that, as maritimers, we appreciate the feeling that the government has taken in its approach through DREE.
Unfortunately what has developed since the decentralization of DREE is that there has been no change in its attitudes, no gut changes in its approach. This has contributed to the continuing attitude of the Bay Street mandarins toward the Atlantic region, an attitude which I refer to as a "piggy bank" attitude. I feel that there should be a definite plank for development. I believe that DREE should take upon itself a program to establish definite goals that would illustrate the direction in which it would like to see the Atlantic region go. I believe that a fresher approach is necessary, and I would like
Adjournment Debate
to see new life injected into the old program and hierarchy of DREE.
Let me now refer to the present GATT negotiations. I am not privy to any inside information, but I believe that one approach which could be taken to help develop the Atlantic region would be to negotiate with the United States with regard to the maritime and Atlantic regions specifically. The Atlantic region is hindered in taking advantage of the great New England market, which is comprised of millions of people, by the economic countervailing duties, trade barriers, and so on.
I would like to see the day when DREE could be disbanded altogether. I suggest that one approach would be to set up a special program whereby products which are manufactured and exported from the maritime region to the New England market are given special consideration. This would have the benefit of attracting new industry to the maritimes and of inspiring manufacturers to expand existing industry. It would also pave the way for that well known approach which has been talked about for some time, the branch plant approach, whereby major manufacturers in other areas of Canada locate and establish branch plants in an area which has access to particular markets. We offer in this case a well positioned geographic location plus a solid, substantial labour market, so that the products of an industry could be very attractive to that very lucrative New England market.
It was in this context that I posed my question the other day during question period. I appreciate the opportunity of having this allotted time to bring my concerns to the attention of the government, because I am not hindered by the question period in so far as supplementary questions are concerned.
I think that the attitude of the government, although it is channelled in the proper direction, has become stagnated. I would like to see a face lift for DREE, with the ultimate goal of phasing out the operation totally because we, as Atlantic Canadians and maritimers, have the expertise, labour, and certainly the willingness.


Donald Paul Wood: Mr. Speaker, I am glad to have the opportunity to respond to the hon. member on the question of our progress with the United States in the GATT negotiations in Geneva in the area of non-tariff barriers.
The draft agreements that we have been discussing with our trading partners cover a very wide range of subjects-subsidies and countervailing duties, government procurement practices, customs valuation, safeguards against disruptive imports, technical barriers to trade, import licensing procedures, the counterfeiting of commercial trade marks, and trade in civil aircraft and parts. All of these, of course, have been the subject of multilateral discussion rather than direct negotiation with the United States. Given the extent of our trade with that country, however, their impact on the flow of goods between us is clearly of major significance. An obvious example is the code on subsidies and countervailing duties.

March 5, 1979
Adjournment Debate
As a result of these negotiations, the U.S. Congress will be asked to amend its legislation to require a determination of material injury to domestic industry as a precondition to the imposition of countervailing duties. Such a change will substantially diminish the threat of such duties being levied against Canadian exports which have benefited from Canadian assistance programs. This has obvious relevance to the sorts of cases we have encountered in recent months.
In the area of government procurement, what is being discussed is a code which will provide a start in bringing government purchases under international trade discipline. The question of coverage is still under negotiation. With regard to customs valuation, an international code has also been under discussion. As drafted, there remained a number of difficulties from the Canadian point of view. No government decision has yet been taken as to whether or not Canada will adhere to this code and, if so, under what conditions.
Another important area in the negotiations has to do with safeguards, that is to say, the action which a country is permitted to take to protect its domestic producers from serious injury arising from a sudden and significant increase in
imports. One of the special questions under discussion is a provision which would allow such action to be taken on a selective basis against imports from those countries primarily responsible for the injury, rather than against imports from all suppliers of the product in question.
The proposed agreement of technical barriers is designed to prevent the use of standards or technical regulations in such a way as to create unnecessary obstacles to the flow of international trade. Canada and the United States have common interests in this area.
In general, Canada and the United States are in reasonable agreement on these various codes and other arrangements. For the most part they are at a relatively advanced stage and negotiations are continuing. Even after the negotiations are over, of course, there will undoubtedly remain a number of non-tariff problems to be resolved. These will be taken up as necessary with the United States and our other trading partners.


Mr. Deputy Speaker:: Order. The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 2 p.m.
Motion agreed to and the House adjourned at 10.28 p.m.

Tuesday, March 6, 1979