1979-12-03

ROUTINE PROCEEDINGS


Hon.   J.-J. Blais@Nipissing: Mr. Speaker, pursuant to Standing Order 43, I rise on a matter of urgent and pressing necessity. Canadians, facing tight oil supplies this winter and concerned with the total inability of their government to take any decision in energy matters, except the dismantling of Petro-Canada, have been shocked to learn that at least two of the major oil multinationals have been siphoning millions of Canadian dollars to their United States parents, while others have diverted large amounts into enterprises unrelated to the oil and gas industries.
Since the amounts of Canadian dollars passing through the hands of multinationals annually may exceed $25 billion, or 10 per cent of the gross national product of Canada, I move, seconded by the hon. member for Ottawa Centre (Mr. Evans):
That this House urges the government to charge the Auditor General to inquire, pursuant to section 11 of the Auditor General Act and section 9 of the Petroleum Corporations Monitoring Act, into the financial activities of the oil multinationals operating in Canada, including the transfer of funds into parent companies as well as the diversion of funds into investments unrelated to the oil and gas industry in Canada or abroad.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
[ Translation]


REQUEST GOVERNMENT MODIFY POLICY CONCERNING PETRO-CANADA-MOTION UNDER S O. 43
Hon. Marc Lalonde (Outremont):: Mr. Speaker, pursuant to Standing Order 43, I ask for the unanimous consent of the House to move a motion dealing with an important matter of urgent and pressing necessity.
Considering that the latest Gallup poll confirms the retreat of this government, and that the Prime Minister and the officials of the Progressive Conservative Party did not even succeed in having their own candidate elected as president of the Quebec section of that party at their convention last weekend; considering that not only public opinion but even the members of the Progressive Conservative Party have lost confidence in this government, I move, seconded by the hon. member for Hull (Mr. Isabelle):
That the House request the government to modify completely its policies and, especially, to relinquish its plans to dismantle Petro-Canada and to raise taxes substantially on the pretext of energy conservation.


Mr. Speaker:: The House has heard the motion of the hon. member. This motion, pursuant to Standing Order 43, can be presented for debate at this time only with the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


CANADIAN PACIFIC RAILWAY
Mr. Bob Rae (Broadview-Greenwood):: Mr. Speaker, whereas the Canadian Pacific Railway has been exacting liability release forms from the residents of Mississauga before making any payment for out of pocket expenses, and whereas this amounts to a form of economic duress and proves once again that some rob you with a six-gun and some with a fountain pen, I move, seconded by the hon. member for Nickel Belt (Mr. Rodriguez):
That this House condemns the CPR for exacting releases from future liability from the residents of Mississauga as a precondition for payment of out of pocket expenses, calls upon the government of Ontario to render such releases null and void, and calls upon the Government of Canada to use all the resources at its disposal to dissuade the CPR from this course of action.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.

December 3, 1979


REQUEST GOVERNMENT INTRODUCE LEGISLATION ESTABLISHING ENERGY BANK BEFORE BRINGING DOWN BUDGET-MOTION UNDER S O. 43
Mr. Armand Caouette (Abitibi):: Mr. Speaker, under the provisions of Standing Order 43, I ask for the unanimous consent of the House to move a motion dealing with an important matter of pressing necessity.
In view of the announcement made by the right hon. Prime Minister (Mr. Clark) during the conference which was held among the premiers of the provinces and himself last November 12, regarding the creation of a Canadian energy bank; and considering the commitment he made last weekend in Quebec City during the convention of the Quebec wing of the Progressive Conservative Party, I move, seconded by the hon. member for Beauce (Mr. Roy):
That the House request that the government introduce in the House its legislation on the Canadian energy bank before bringing down the budget scheduled for next week.


Mr. Speaker:: The House has heard the terms of the hon. member's motion. Pursuant to Standing Order 43, this motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


NATIONAL DEFENCE
Mr. Alex Jupp (Mississauga North):: Mr. Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity.
In view of the claims by Major General Herbert Pitts, formerly the head of the Canadian Airborne Brigade, in last evening's CTV program "W5" that because of the neglect of our defence requirements over the past decade, our northern defence forces are so inadequate and antiquated that as few as 1,000 Soviet troops could take over our northern installations, I move, seconded by the hon. member for Assiniboia (Mr. Gustafson):
That the government undertake a special inquiry into the serious nature of General Pitts' allegations, with a mandate to recommend specific steps to restore our northern defence capacity.


Mr. Speaker:: Is there unanimous consent for the presentation of such a motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.

[ Translation]


METRICATION
Mr. Irenee Pelletier (Sherbrooke):: Mr. Speaker, I rise under Standing Order 43 to ask for the unanimous consent of the House to introduce a motion on an urgent and important matter.
Considering that the metric system has been adopted by almost every country, except the United States, considering that it was introduced in Canada almost ten years ago and that Canadians from coast to coast are gradually yet quickly getting used to it, considering that governments, small and medium businesses and institutions have, since 1970, spent large amounts of money to acquire the new weights and measures equipment; and considering that it will cost us millions of dollars more if the handful of Progressive Conservative members who have been attacking the system for highly questionable reasons continue to do so, I move, seconded by the hon. member for Spadina (Mr. Stollery):
That the Prime Minister, the Minister of State for Small Businesses and the Minister of Energy, Mines and Resources indicate to the House, unequivocally and as soon as possible, whether it is their intention to continue to obstruct for a long time, and without reason, the total and complete conversion in Canada to the metric system.


Mr. Speaker:: Order, please. Under Standing Order 43 such a motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


PRESENCE IN GALLERY OF FIRST VICE-MINISTER OF FISHERIES AND MEMBER OF SUPREME SOVIET OF THE U.S.S.R.
Mr. Speaker:: May I invite hon. members to join with me in signalling the presence in our gallery of a distinguished visitor in the person of the First Vice-Minister of Fisheries and, of course, he is also a member of the Supreme Soviet of the U.S.S.R., Mr. Kudryavtsev.


Some hon. Members:: Hear, hear!

December 3, 1979


NEW MEMBER
Mr. Speaker:: I have the honour to inform the House that the Clerk of the House has received from the Chief Electoral Officer a certificate of the election and return of Stan J. Hovdebo, Esquire, member for the electoral district of Prince Albert.


NEW MEMBER INTRODUCED
[Stage Direction]
Mr. Stan J. Hovdebo, member for the electoral district of Prince Albert, introduced by Mr. Edward Broadbent and Mr. Lome Nystrom.


Right Hon. P. E. Trudeau (Leader of the Opposition):: Mr. Speaker, I have a question for the Prime Minister, as we enter the fifth week of the hostage-taking incident in Iran. As, over the last few days, the heads of the European Economic Community have decided to make a collective statement denouncing that incident-I hope they do not have to apologize to the members of the European Parliament, as our foreign minister did when I asked that the statement be made at the heads of government level-I would like to know, and the House would like to be informed by the Prime Minister whether he has taken steps toward getting that type of statement from the seven participants at the Tokyo Summit, which would constitute a reinforcing of our solidarity with the United States.


Right Hon. Joe Clark (Prime Minister):: Mr. Speaker, 1 naturally welcome the decision taken by the leaders of the European Economic Community at Dublin. 1 think their statement was strong and unequivocal and indicates that they stand, as Canada does, very strongly in support of the efforts of the United States to have Iran respect international law.
Pursuant to suggestions made by the right hon. Leader of the Opposition and others, I have been in touch with some of the other countries represented at the Tokyo Summit. It is my view that it would not be particularly productive to have the wealthy nations of the world, represented at the Tokyo Summit, gathered together at that forum or as emanations of that forum to add to statements which each of those nations has already made individually, or in other forums.


Pierre Elliott Trudeau: A supplementary question, Mr. Speaker. When it comes to upholding international law, I am not quite
Oral Questions
certain how the Prime Minister thinks the size of one's pocket-book can affect the declaration. Surely the members of the EEC did not look to their pocketbooks before making that statement. The Prime Minister fails to see the point, once again, that it is collective action and collective decisions which are noted and needed at this point, not individual statements by Canada or someone else. The Europeans have understood that.
1 should like to ask the Prime Minister, once again, if he could tell us if he is working toward some international statement of co-operation of the leaders of the seven nations. Could he tell us what kind of statement he is looking at? Is it merely a statement of protest at the breach of international law, or is he seeking to get a commitment from various friends and allies of the United States that they would be 'prepared to impose international sanctions on Iran or any other country which acted in breach of international law?


Charles Joseph Clark: Mr. Speaker, I would have thought that, of all people in this House, the right hon. Leader of the Opposition would have understood that in a situation as delicate and as complex as this, the purpose of Canada and other countries in seeking to uphold international law should not be simply to be heard, but should be, rather, to be effective in trying to bring influence to bear on the Iranian authorities.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: I am not interested, and I think most Canadians are not interested, in finding a forum for Canada to speak. We have plenty of those forums, and we have been effective there. What I am interested in, and what I think other countries in the world are interested in, is finding a variety of means by which the authorities in Iran can be persuaded to respect international law.
Consequently, we as the Government of Canada have taken a role of leadership, through a variety of the forums open to us, that we believe will have influence on the Iranians. We have done that at the United Nations; we have done that through the Commonwealth; we are doing it through Franco-phonie. We are doing that individually and bilaterally with other countries. That will continue to be our approach, to try to amass as much as possible a range of influence upon the Iranian authorities to encourage them to respect international law. Our interests will be in the response of Iranian, not the response of Canada.


Pierre Elliott Trudeau: Mr. Speaker, I think the Prime Minister is on solid ground when he asks for effective action and not merely expressions of indignation. But it seems to me that that is what the world has been having a lot of in the past month, expressions of indignation, of solidarity for the United States, and the whole point of my question, Mr. Speaker, is that it has not been effective. A month will have elapsed tomorrow since the taking of the hostages. We have not been effective. When we met in Bonn a couple of summers ago, we took effective action

December 3, 1979
Oral Questions
against hijacking by deciding that we would all act collectively against those who perpetrated any hijacking.
What I want to know now from the government is whether it is contemplating such a form of action or declaration, a declaration of solidarity with the United States indicating that if we do not act collectively against this international terrorism, at least we would support the United States in imposing sanctions on its own against any country like Iran which is perpetrating indignities against the United States.


Charles Joseph Clark: Mr. Speaker, we are, naturally, considering whether sanctions by Canada, by the United States or by anyone else would be effective. At this stage, we think what will be effective is not a show of force in relation to Iran, except the force of international opinion, and we are trying through a variety of initiatives, public and private, to bring to bear upon authorities in Iran the view of Canada and the view of other countries which respect international law that the situation now existing in Iran is not acceptable.
I repeat to the House, and I repeat to the right hon. Leader of the Opposition who, of all members in this House, should understand the delicacy of the situation, that this is not a matter where a desire for domestic publicity should be allowed to interfere with the effectiveness of international action.


Some hon. Members:: Hear, hear!


UNITED STATES DECISION NOT TO PURCHASE OIL FROM IRAN-POSSIBLE ASSISTANCE FROM CANADA
Hon. Allan J. MacEachen (Cape Breton Highlands-Canso):: Mr. Speaker, I will attempt to avoid seeking publicity in putting this question, and follow the modesty of the Prime Minister who has never been known to seek publicity on any subject.


Some hon. Members:: Oh, oh!


Allan Joseph MacEachen: But more seriously, Mr. Speaker, the Prime Minister has talked about effective action and a range of influences, especially the necessity of supporting the United States. In view of the fact that a high official in the Carter administration had a statement attributed to him over the weekend, that allies of the United States were prepared to do everything they could to help the hostages, except to hurt themselves-it seems to me that that reflects the feeling of isolation that is growing in the United States-has the Prime Minister explored within his government or with other governments the possibility of assisting the United States this winter because of its decision not to purchase any more oil from Iran by making available, in concert with other nations, some additional supplies?


Charles Joseph Clark: Mr. Speaker, we would certainly be prepared to consider that.


Allan Joseph MacEachen: Mr. Speaker, on another point related to that, may I ask the Prime Minister, has he explored or is he prepared to explore, in concert with other nations, taking the

step which the United States has already taken, namely, to declare that it will no longer rely upon sources in Iran for oil supplies? Would he explore that possibility and consider it possibly with other nations as a way of giving some teeth to his readiness to apply sanctions in this situation?


Charles Joseph Clark: Mr. Speaker, certainly, again, we would be prepared to consider that to see whether it would be effective. I repeat to the hon. member and to the House that what we are interested in here is not simply showing the extent of our support for the United States, for North American reasons, but what we are interested in here is to try to mobilize international opinion in a way that will have an effect upon the authorities in Iran.
It may be that indications of support for the United States, of the kind to which the hon. member refers, would be useful. If so, we will certainly consider them seriously. But I think it is important for me to underline to the House how essential it is, in circumstances like this, for us to act with some calm, to act in a way that is designed to have influence upon authorities in Iran as our primary purpose, and not to let that primary purpose fall prey to any subsidiary domestic purpose.


NATURAL RESOURCES
Mr. John Rodriguez (Nickel Belt):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources. In view of the fact that a particularly serious situation exists in the iron ore mining industry in Ontario, with four out of nine iron ore mines closing in the last 18 months, with a loss of over 1,200 jobs, the fact that the Ontario steel industry now imports 58 per cent of its iron ore, most of it from the United States, and the fact that mines in Atikokan and Capreol can still provide this iron ore, will the minister tell the House what steps he plans to take to investigate the situation and to get these mines and men working again?


Hon. Ray Hnatyshyn (Minister of Energy, Mines and Resources):: As the hon. member knows, Mr. Speaker, there has been a downturn in the demand for steel from Canadian producers, as well as with respect to iron ore from mines in Canada. Part of this is attributable to increased production in the United States. We in the department are very much involved in monitoring this situation. In conjunction with my colleagues in cabinet, we will continue to watch the situation in order to see what can be done to improve the circumstances in Canadian mines and with regard to steel producers.


John R. Rodriguez: Mr. Speaker, I will direct my supplementary to the Prime Minister, because trying to get an answer from the minister is like trying to find eggs in a cuckoo clock.


Some hon. Members:: Oh, oh!


Mr. Crosbie:: You're the expert on cuckoos.
December 3, 1979


John R. Rodriguez: Keeping in mind that steel mills in Canada are operating at or near 100 per cent capacity, and that it is the density of foreign ownership of our resources and the vertical integration of monopolies in the iron mining and steel industries in Canada that are resulting in the replacement of Canadian iron ore production by foreign imports, can the Prime Minister tell us whether his government is prepared to take steps to rationalize the iron and steel industry so that Canadians can get the maximum benefits from their resources?


Charles Joseph Clark: Mr. Speaker, the claim of the hon. member to absolute authority in relation to anything touching on cuckoos is uncontested in this House.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: In relation to his question, we as a government are certainly interested in developing means by which we can encourage more Canadians to become more active in the ownership of Canadian resource industries. That is one of the reasons we are proposing the steps we are in relation to energy policy. If the hon. member and his party are seriously interested in practical steps that will encourage Canadian ownership of Canadian resources, I hope they will support the measures we put forward in relation to energy development.


John R. Rodriguez: Mr. Speaker, the Gallup poll has determined who the real cuckoo is in this House at the moment.


Some hon. Members:: Hear, hear!


John R. Rodriguez: I will direct my final supplementary question to the Minister of Employment and Immigration, the friend of the mining companies. Maybe he will have some answers. Was the minister informed, in advance, of the layoffs in all of these iron ore mines? What steps is he taking to overcome the disastrous effects of such shutdowns, because all of them have occurred in one-industry communities? What is he going to do? We want no pussy-footing around.


Hon. Ron Atkey (Minister of Employment and Immigration):: The answer is yes, Mr. Speaker. My officials were informed of, 1 believe, all the cases to which the hon. member has made reference.


John R. Rodriguez: What are you doing about it?


Ronald George Atkey: My officials in the Manpower consultative services have been meeting with mining company officials and union officials to see if there are certain alternatives that can be taken to soften the blow of the lay-offs for the men concerned. One, of course, is unemployment insurance. Another is work-sharing. A variety of options are available within the Manpower consultative service program, and these will be fully explored.
Oral Questions


INQUIRY AS TO DATE OF ESTABLISHMENT OF NATIONAL ENERGY BANK
Mr. Fabien Roy (Beauce):: Mr. Speaker, I should like to put a question to the right hon. Prime Minister.
Mr. Speaker, at the first ministers' conference which met here in Ottawa on November 12 last, the Prime Minister proposed the establishment of a national energy bank. Over the weekend, in Quebec City, the Prime Minister said he would keep his promise. Today, I should like to ask him, for the benefit of the House and the Canadian people, first, when that project will be put before the House; second, who will finance that bank and, third, whether the oil companies will have to participate in it?


Charles Joseph Clark: Mr. Speaker, that is a serious question and I appreciate it very much. I intend to discuss the establishment of a Canadian energy bank with the provincial premiers here on December 17 and 18. We have already had general discussions with them in this regard but, as the hon. member knows, the government hopes that Canada can have such an institution in which not only the federal government would participate but also some of the provinces; if the provinces participate, it would be appropriate for them to take part in drafting the terms of reference of that bank.
With regard to the funds, they would be collected through federal taxes. We intend to channel all the funds provided by new taxes to oil companies; we want to channel them to the Canadian energy bank and other energy projects. We hope it will be possible for some of the provinces to contribute to it financially.
As for the third part of the question dealing with the participation of the companies, we intend to have the Canadian energy bank give special assistance to those Canadian companies that want to participate in the development of Canadian natural resources.


INQUIRY WHETHER AGREEMENT IN PRINCIPLE CONCLUDED WITH CERTAIN PROVINCES
Fabien Roy: I have a supplementary question, Mr. Speaker. The Prime Minister has had talks with the provincial governments. I would like to know whether his proposal or at least its basic principle has been accepted by some of them. Further, 1 would like to ask him whether the oil companies will be obliged to deposit in the Canadian energy bank the profits accruing from the price increases or if the government only intends to get that money through the tax system. In other words, I would like to know whether the increases-

December 3, 1979
Oral Questions


Mr. Speaker:: Order.


Charles Joseph Clark: Mr. Speaker, most provinces have made a statement of intent about the establishment of a Canadian energy bank. If that is necessary, 1 hope we can introduce a bill in the House in January or February. I hope we can do it in January. As for the issue of profits, we intend to develop a taxation scheme through which we can recoup most of the new profits the oil companies will make following the increase in the price. We will direct a large part of this money towards the Canadian energy bank while other revenues from that source will be directed towards Canada's other energy goals.


INTERNATIONAL TRADE
Hon. John C. Munro (Hamilton East):: Mr. Speaker, I should like to address my question to the Minister of State for Small Businesses and Industry. He is no doubt aware that a few days ago Mr. Greenwald, a vice-president of Chrysler (America), appeared before a congressional committee and stated that negotiations were under way with the Canadian government for financial help for Chrysler Canada to the extent of $150 million to $300 million. As I say, he indicated-and this was confirmed to the standing committee last week-that negotiations were going on with Canada.
Could the minister advise the House whether, in the process of these negotiations, we are insisting on Canadian equity participation in the ownership of Chrysler here, as a means of ensuring that our money stays in Canada and that Canadian jobs stay in Canada to give our people opportunity for employment?


Hon. Michael Wilson (Minister of State for International Trade):: One of our principal concerns in the negotiations we are carrying on right now with the Chrysler Canada people is the employment of the people involved in Windsor. This will be studied from a number of different angles. Indeed, the question has been under study for about two months as a result of a series of meetings we have had with Chrysler Canada officials. I cannot say at this stage just what form of government support they would receive, if any.
As to the proposals we are considering, we are looking at a wide range of possibilities and as soon as decisions have been reached I will be very happy to advise the House.


John Carr Munro: I will direct my question to the Prime Minister. He can no doubt give a specific answer to my question. About three months ago the Automotive Parts Manufacturers' Association of Canada suggested to the Canadian government that in return for financial help to Chrysler, we should ask for the sale of Chrysler parts manufacturing subsidiaries to Canadians, and that in addition we
[Mr. Roy (Beauce).J
should ask for increased Canadian participation and ownership in Chrysler Canada. That would be one of the conditions for advancing any money to save Chrysler Corporation. If the Prime Minister is not aware whether this is a condition or not, would he be prepared to consider it as one of the conditions for any help?


Michael Holcombe Wilson: As I said to the hon. member earlier, that is one of the options which is open to us. We are looking at a variety of options. Our principal concern is to protect the jobs of the people in the Windsor community who are affected. As soon as we are able to put forward a specific package on completion of our negotiations with Chrysler Canada, we shall do so.


STUDY OF CANADA-U.S. AUTO PACT
Mr. John Evans (Ottawa Centre):: Mr. Speaker, my question is directed to the Prime Minister. In view of the great concern over Canada's international deficit situation and the fact that the auto pact is about to add some $3.1 billion to that deficit, and bearing in mind that the Ontario minister of industry and tourism has announced that the province is preparing a study of the auto pact-which is a federal government agreement with the United States-is the right hon. gentleman prepared to enter into joint co-operative effort with Ontario to examine the auto pact which could have such a great bearing on the future of our economy?


Charles Joseph Clark: As the hon. member may know, the Government of Canada completed a study last year and so, I understand, did the government of Ontario. I would certainly be prepared to discuss the matter with officials of the Ontario government to determine whether they think there is any need for a new study, and whether they believe it would be useful for the federal government to participate in such a study. We would make our decision on the basis of the response.


OUTFLOW OF FUNDS FROM OIL MULTINATIONALS-SITUATION WITH OTHER MULTINATIONALS
John Leslie Evans: Mr. Speaker, I should like to address a further question to the Prime Minister, again dealing with the question of the deficit. The Minister of Energy, Mines and Resources has indicated he intends to bring in the multinational oil companies to look into the outflow of funds which was announced on Friday in a report from his department.
Would the Prime Minister agree to involve himself in these discussions, and would he be prepared to pursue the matter further by inquiring whether other multinational corporations might be behaving in a similar way by allowing money to flow out of Canada?
December 3, 1979


Charles Joseph Clark: I do not think there will be any need to involve myself at this stage. The matter is within the active responsibility of the Minister of Energy, Mines and Resources. His officials are meeting this week with those of the companies concerned, I believe. The minister himself will be meeting with other representatives of those companies, more senior representatives, if that turns out to be necessary. 1 think there is no need for me to become involved at this stage.
In relation to the broader question, I will check with our officials to see if we have any record of significant movement in fields other than energy. As the hon. member and the House will know, the danger has been most acute and most evident in relation to energy companies.


INTERNATIONAL TRADE
Mr. Denis Ethier (Glengarry-Prescott-Russell):: Mr. Speaker, my question is to the right hon. Prime Minister. In light of the statement last week by Ken Graydon, executive vice-president of the 2,800 member Federation of Automobile Dealer Associations, predicting that the delayed impact of recent interest rate increases could mean that the Canadian auto industry is only "a month or two away from real hurt", does the government not feel that there is an urgency involved in making a decision about Chrysler Canada before the situation deteriorates any further?


Michael Holcombe Wilson: Mr. Speaker, we have been very conscious of the state of the industry in the discussions we have had with Chrysler Canada officials. I think a great deal of good discussion has been going on today to try to get to the heart of this problem so that we will be able to come forward with a proposal which will receive acceptance by this House.
I should point out that the proposal which has been put forward by Chrysler does not call for a bail-out situation the same as in the United States. It is a proposal which relates to the long-term development of the company and the industry in this country.


Denis Éthier: Mr. Speaker, my supplementary is to the Prime Minister. Given that employment at the Chrysler Canada engine plant in Windsor has dropped from 2,800 workers in 1978 to around 500 workers now, because of the plant's continued reliance on production of V-8 engines, and given that this plant could be the location of production of a new Chrysler V-6 engine, will this House be assured that any aid given to Chrysler will be contingent on the V-6 engines being produced at Windsor rather than the rival site considered at Trenton, Michigan?
Oral Questions


Michael Holcombe Wilson: Mr. Speaker, the future of the engine plant is very much a part of the proposals which have been put forward by the people of Chrysler. I do not think anything more can be said now in a meaningful way without jeopardizing the industrial confidence and the competitive position of Chrysler in the automotive industry.


REQUEST FOR STATEMENT ON NUCLEAR EXPORT PROGRAM
Hon. Jean-Luc Pepin (Ottawa-Carleton):: Mr. Speaker, on the same subject of jobs, but changing the industry to the nuclear industry, my question is to the Prime Minister. About 35,000 jobs directly, and the fate of more than 100 manufacturers, wholly or in part, are dependent on the success of the nuclear export program. Yet there are uncertainties and difficulties in marketing in Argentina and Japan.
The Secretary of State for External Affairs has made a statement demanding "the most stringent conditions", which is unclear. A parliamentary committee might be created soon on the whole problem of nuclear energy. Could the Prime Minister commit himself to a calm, but strong and relatively detailed statement on the nuclear export program, in the coming weeks?


Charles Joseph Clark: Yes, Mr. Speaker, I think I can state again the position of the Government of Canada in relation to the nuclear export program. It might be helpful for that to be done as a prelude to the consideration of related questions by a committee of this House. I will take the opportunity to review the guidelines and the conditions set down, not only by this government but also by the preceding government, and also to review the very active work which has been undertaken by the Minister of State for International Trade and others in pursuing contracts for the Canadian nuclear industry.


FISHERIES
Mr. Ted Miller (Nanaimo-Alberni):: Mr. Speaker, my question is to the Minister of Fisheries and Oceans. The minister was quite busy at the end of last week announcing three policies, one on Atlantic salmon and another on the roe herring industry in British Columbia, and on Friday he announced a new policy for factory trawlers on the east coast.
In view of the fact that the policy of the minister on the roe herring industry in British Columbia will result in the loss of 800 to 1,000 jobs in that industry, and in view of the fact that the minister has guaranteed that in the Atlantic industry bona fide salmon industry fishermen will maintain their jobs, will the minister guarantee the same rights to bona fide fishermen in the British Columbia herring industry, and will he assure us that those moonlighters who have been in the industry will be curtailed just as they will be on the Atlantic coast?

December 3, 1979
Oral Questions


Hon. James A. McGrath (Minister of Fisheries and Oceans):: Mr. Speaker, my understanding is that this will result in a short disruption for the fishermen who are to be affected. However, I will certainly take the hon. member's question as a representation and I will be prepared to discuss it with him.


NATIONAL DEFENCE
George Alexander (Alex) Jupp: Mr. Speaker, my question is to the Minister of National Defence. It is a follow-up of my motion under Standing Order 43 which, unfortunately, was turned down because of the negative votes of some hon. members in the New Democratic Party.


Some hon. Members:: Order.


Mr. Speaker:: If the hon. member has a question, would he put it forthwith.


George Alexander (Alex) Jupp: Yes, Mr. Speaker. My question pertains to the very serious allegations which were made in last evening's "W5" program in which it was said that because of a decade of neglect, Canada's situation in terms of being able to defend our country is in very serious jeopardy and that, indeed, 1,000 Soviet troops could take over our northern installations.
Would the Minister of National Defence be prepared to consider setting up a special inquiry which would have as its mandate the making of recommendations to Canada on the necessary steps which must be taken in order to restore our defence capacity in northern Canada?


Hon. Allan B. McKinnon (Minister of National Defence and Minister of Veterans Affairs):: Mr. Speaker, this is a very serious question and I can say that I, of all people in the House, am well aware of the deficiencies in the equipment of the Canadian Armed Forces. Unfortunately, we cannot turn a situation like that around in six months. A more modest appraisal would be that in about six years we can turn it around. We intend to do the best we can, with the funds which are available to us, to provide equipment and armed forces to ensure the sovereignty of this nation.


REGIONAL ECONOMIC EXPANSION
Mr. Gilles Marceau (Jonquiere):: Mr. Speaker, my question is for the Minister of Regional Economic Expansion. On March 14, 1974, one of his predecessors, the Hon. Don Jamieson, signed a basic agreement with Quebec for a period
[Mr. Miller.)
of ten years in order to stimulate the creation of permanent jobs and a more balanced development among Quebec and the other provinces of Canada. This basic agreement and this development agreement was translated into subsidiary agreements.
Can the minister say whether that agreement will be honoured up to its term of expiry and, if so, in order that it does not become inoperative, did the minister ensure that the Minister of Finance will grant the necessary funds and, more particularly, does the minister intend to stand by the letter of the subsidiary agreements being implemented and to respect the timetables agreed upon, so that the Saguenay-Lac-Saint-Jean area may benefit from the $16 million set aside for this year and the $55 million earmarked for the period 1980 to 1983?
[ English ]


Hon. Elmer M. MacKay (Minister of Regional Economic Expansion):: Mr. Speaker, I can assure the hon. member that our department will continue to perform its mandate under the terns of the general development agreement, not just in Quebec but in all the provinces, and that my colleague, the Minister of Finance, has a very genuine commitment to regional development. We will be following through and honouring our commitments.
[Translation\


AGREEMENT WITH QUEBEC-REQUEST FOR MODIFICATION TO ASSIST SAGUENAY-LAKE SAINT JEAN REGION
Gilles Marceau: I have a supplementary, Mr. Speaker. While he is favourably disposed, could the minister indicate whether new and additional agreements, as well as amendments to existing agreements could be negotiated and signed between the Government of Canada and the government of Quebec in order to assist the Saguenay-Lac-Saint-Jean area which requires major and immediate assistance to alleviate its economic situation?


Elmer MacIntosh MacKay: Mr. Speaker, I trust that this will be possible: certainly, it is my desire that it be so. This will be a matter for continuing discussion between ourselves and the government of Quebec.


REQUEST FOR ASSURANCE OIL SUPPLIES WILL BE SUFFICIENT THIS WINTER
Marc Lalonde: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources. It relates to the extremely serious, extremely fragile situation, to
December 3, 1979

use the minister's own terms, of Canada's oil supply this winter, particularly in eastern Canada. A few weeks ago, in answer to a question, the minister indicated that an oil shipment leaving Iran today would reach Canada on December 14, and that another shipment would leave Iran on January 4 and arrive on February 5. Can the minister tell us, first, whether the loading of the December 3 shipment is proceeding normally and whether we can count on this oil being delivered? Also, can he tell us whether Canada expects a fifth shipment which is not scheduled yet in addition to the January 4 one, which would reach Canada later during 1980, so as to ensure that we will not experience any oil shortage this winter?


Ramon John Hnatyshyn: Mr. Speaker, I can tell the hon. member that this morning I communicated with the president of Gulf with respect to the present circumstances on shipment of crude to Canada from Iran. He confirmed that the second shipment is, in fact, very close to delivery in eastern Canada and we should expect it.
Also, he indicated to me that he expects arrangements will be made relating to additional shipments at the beginning of the New Year. Due to the uncertainty in terms of the Iranian situation, it is impossible to say whether or not that will be the source of supply. But the company is working very hard to obtain alternate sources of supply with respect to crude. They are very optimistic that that, in fact, will be received by us in February.


INQUIRY WHETHER FIFTH OIL SHIPMENT WILL ARRIVE FROM IRAN
Marc Lalonde: Mr. Speaker, 1 have a supplementary. My question may have confused the minister a little. I wanted to know if another shipment is scheduled after the January 4 shipment. Could the minister confirm that this fourth shipment is indeed scheduled for early in 1980, or is there some connection between this shipment and the lack of vigour with which the government is dealing with the matter of the hostages' release in Iran?


Ramon John Hnatyshyn: Mr. Speaker, I find it rather strange that the hon. member would raise this point with respect to further deliveries from Iran when his leader, not five minutes ago, indicated that we should impose a sanction with respect to deliveries from Iran.
The fact is that the corporation indicated to me today, in the discussions, that they are not only bringing in supplies in terms of light crude which will be brought to the refineries here, but also are investigating in a very serious way the importation of
Oral Questions
product to supply Canadian needs over the course of this winter.


GOVERNMENT EXPENDITURES
Mr. Donald J. Johnston (Saint-Henri-Westmount):: Mr. Speaker, my question is for the President of the Treasury Board. As the House is aware, the government has announced its intention to appoint a special committee to look into cost overruns on major government projects, which would appear to be part of the mandate of the Standing Committee on Public Accounts.
Therefore, my question to the President of the Treasury Board is: during this period of concern with government expenditure, how can he justify the establishment of a committee which effectively would duplicate the mandate of a standing committee of this House?


Hon. Sinclair Stevens (President of Treasury Board):: Mr. Speaker, I am very pleased that the hon. member has asked me that question, because it gives me an opportunity to draw the significant distinction between the work the special committee will be doing and the very good work which the Standing Committee on Public Accounts does with regard to such things as major capital expenditures.
The special committee will deal with the present: it will deal with jobs that are ongoing, where we have been told that there could be overruns as much as 400 per cent from the original estimate. We would like that committee today to tell us what we can do to arrest this dreadful situation with such overruns. I hope the Standing Committee on Public Accounts will carry on its good work of looking at the deals which were reported on, say, two years ago by the Auditor General, and of drawing up more general guidelines as to what might be done of a more general nature in order to have a more satisfactory management system in Canada.


Some hon. Members:: Hear, hear!


Donald James Johnston: Mr. Speaker, the President of the Treasury Board does not appear to be aware of the current work of the Standing Committee on Public Accounts and the Study of Procedures in Cost Effectiveness on an ongoing basis which the Auditor General is carrying out.
My question is: since the work, essentially, has had this same objective, non-partisan approach, surely it would be appropriate to appoint a member of the opposition as chairman of such a committee, in the same spirit as the Right Hon. John Diefenbaker established in 1957, that a member of the opposition should be chairman of the Standing Committee on Public Accounts.


Sinclair McKnight Stevens: Mr. Speaker, if I may reply to the hon. member, in no way do we wish to see the Standing Committee

December 3, 1979
Oral Questions
on Public Accounts cease doing its good work. But what we are saying is that there are specific projects before us. At the present time, Treasury Board is considering an overrun in the Prince Rupert grain drying facility, in the MAPP facility in Montreal, in an environmental centre in Newfoundland, and we would like the advice of a parliamentary committee as to how it thinks we can arrest, somehow or other, these dreadful overruns which we are now experiencing. We would like the committee to tell us, have we done enough to arrest the deterioration as far as the expenditures are concerned? Do they have any suggestions?


NATIONAL DEFENCE
Mr. Terry Sargeant (Selkirk-Interlake):: Mr. Speaker, my question is for the Minister of National Defence and Minister of Veterans Affairs. It concerns the rather startling reports that the United States department of defence presently is seriously investigating the feasibility of stationing Trident nuclear submarines in the Great Lakes as an alternative to the MX program.
Has the minister informed his American counterpart that such a plan would place the United States in violation of the Rush-Bagot agreement, and has he taken steps to inform the United States that Canadians are not prepared to accept, under any circumstances, Trident nuclear submarines in the Great Lakes?


Allan Bruce McKinnon: Frankly, Mr. Speaker, it has always seemed to me that the idea was too preposterous to take seriously.


SUPPLY AND SERVICES
Mr. Bob Kaplan (York Centre):: Mr. Speaker, I would like to ask the Minister of Supply and Services why he changed the policy relating to Media Buying Services Ltd. When he testified before the Standing Committee on Miscellaneous Estimates, he repeated three times that the government would use the tender system for contracts to advertising agencies. Now, the House knows about two contracts which were awarded to Allan Gregg and a third one about the tourism bureau without any call for tenders. Why did the minister change his policy?


Hon. Roch La Salle (Minister of Supply and Services):: Mr. Speaker, the answer is quite simple. When the committee asked those questions, I referred to an eventual contract which

was to be signed in the short term. That contract should be signed very soon now. I clearly stated to the committee that I could not say anything about that contract because it had not been signed yet. Given the old practice of calling for tenders, we hired a company specializing in that field for the reasons we have already told the House. That mechanism allows us to achieve the goals that we had already set-reduction of expenses and quality of programs-and we trust that MBS will give us the best possible information because of its experience and qualifications in the field.


INQUIRY AS TO PAYMENTS MADE TO MEDIA BUYING SERVICES
Robert Phillip Kaplan: Mr. Speaker, since there is no contract at present between the federal government and that firm, and since the latter has nevertheless started to award contracts, and so on, has the government already made payments to that firm? If so, how much, and how does it figure out how much a firm that is doing so much for the taxpayers will be paid without a contract?


Roch La Salle: Mr. Speaker, given the responsibilities of MBS, l am talking about an over-all contract, but my department has already signed three contracts for July, September and October in the amounts of $39,000, $20,000 and $21,000. Contracts have been awarded by my department and we hope to sign at least a medium-term, over-all contract for the responsibilities entrusted to that firm.


REGIONAL ECONOMIC EXPANSION
Mr. Marcel Dionne (Chicoutimi):: Mr. Speaker, my question is also for the Minister of Supply and Services. Last week, he said that we have made a lot of speeches and now the time has come to act. Now that the government is about to unveil the details of a broad strategy for economic recovery by all underdeveloped regions, including Chicoutimi, may I ask the minister when that announcement will be made and what economic sectors it will deal with?


Roch La Salle: Mr. Speaker, I think I do not have any particular news to give the hon. member for Chicoutimi today. I simply said we had made a lot of assessments and we are about to announce certain projects that will please Quebec as a whole and Canadians as a whole. The budget of the Minister of Finance is forthcoming, and there will also be statements by the Minister of Regional Economic Expansion which will surely please, 1 hope not only Canadians as a whole but also the people of Chicoutimi.
December 3, 1979


ENVIRONMENTAL AFFAIRS
Mr. Peter Ittinuar (Nunatsiaq):: Mr. Speaker, my question is to the Postmaster General and Minister of the Environment. Public hearings on the Brinex uranium mine proposal are commencing today and are to continue until December 8, 1979. Residents of coastal communities in Labrador have informed me that they have neither the time nor the funds with which to study and assess the available data and information in order to prepare their position.
Can the minister assure the House that he will send representatives from his department to cover and monitor the hearings on the proposed Brinex uranium mine and to ensure that residents are satisfied with the review process?


Hon. John A. Fraser (Postmaster General and Minister of the Environment):: Mr. Speaker, I thank the hon. member for the question. As a result of representations made by the hon. member last week, I have made arrangements to have an official of my department at the hearing today. A senior official was dispatched this morning and will be there for the remainder of the hearings. I thank the hon. member for his concern.


PRESENCE IN GALLERY OF MR. CLAUDE CHEYSSON, SENIOR REPRESENTATIVE OF FRANCE IN EEC
Mr. Speaker:: As we conclude question period, may I be allowed to point out the presence of a distinguished guest in the gallery in the person of Mr. Claude Cheysson, senior representative of France in the EEC.


PENSIONS
John Carnell Crosbie: Mr. Speaker, 1 rise on a point of order. 1 want to clear up a matter that has been arousing some controversy in the House while I have been away, and Your Honour commented on it on Friday. It has to do with the status of the Lazar report on the Canadian pension system, a study done over a period of two or three years by officials of the government.
These are the facts, Mr. Speaker. The report is in three sections; a report, summary and appendices. It was originally drafted in English. With regard to the English version, the report and the summary are ready for printing. These have
Order Paper Questions
been delayed awaiting the French version. At the present time the budget has priority with the printing presses. The report and summary in English are scheduled for printing beginning the weekend of December 15. They can only be printed on weekends and can be completed on the weekend of December 21 and 22. The appendices in English will be ready in mid-January. We are dealing with hundreds of pages of material, some 400 to 450 pages.
Having regard to the French version, the translation should be returned around mid-December. This has been farmed out to translators around the country in order to expedite it. It is being done by those translators in addition to our own. The edited French version of the report should be completed in mid-January, and the summary should be ready by mid-December. The French version of the appendices should be ready by mid-January.
I believe that we can undertake to have the complete English and French versions ready for tabling in the House by the end of January. If there are members in the opposition, pension critics or whoever the opposition parties nominate, who are anxious to get a copy now, we can supply the English version. We cannot table it in the House until we have both the English and French versions. If there is great anxiety in this regard, and certainly there is no one more anxious than we are as we want to refer this report and others to the committee for consideration of the whole pension area, we have several English copies we can provide for this purpose.



ROUTINE PROCEEDINGS


Mr. Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the table the second report of the Clerk of Petitions, stating that he has examined the petition presented by the hon. member for Cowichan-Malahat-The Islands (Mr. Taylor) and advising that it meets the requirements of the Standing Orders as to form.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. David Kilgour (Parliamentary Secretary to President of Privy Council):: Mr. Speaker, the following questions are being answered today: Nos. 151, 230, 243 and 378.
I would ask that the remaining questions be allowed to stand.

December 3, 1979
Order Paper Questions


Mr. Herbert: 1.	How many federal regulatory agencies, having regulatory or semi-judicial powers, exist?
2.	What is the number of such regulatory agencies reporting to Parliament through members of the ministry and what is the number the Prime Minister and each cabinet minister is primarily responsible for?
3.	What is the number reporting only to the Prime Minister and to members of the ministry and what is the number from whom each receives a report?
4.	How many do not report to Parliament or for whom no cabinet minister is responsible?


Mr. John Bosley (Parliamentary Secretary to Prime Minister):: 1. There is no formal official definition of what constitutes a regulatory agency.
One possible definition was provided by the Royal Commission on Financial Management and Accountability, as "agencies whose primary functions are licensing, making rules and orders, and supervising activities in a particular industry or sector of the economy" (Final Report, page 309). On this basis the royal commission listed the following bodies:
Anti-Dumping Tribunal * Anti-Inflation Board Atomic Energy Control Board Canada Labour Relations Board Canadian Radio-television and Telecommunications Commission
Canadian Transport Commission International Boundary Commission *Since ceased to exist.
International Joint Commission National Energy Board
Office of the Administrator under the Anti-Inflation Act
Petroleum Compensation Board Public Service Staff Relations Board Restrictive Trade Practices Commission Tariff Board
It might be noted that other writings on the subject have usually suggested less broad definitions of the term regulatory.
2 and 3. Eight of the bodies mentioned above have reported annually to Parliament through members of the ministry. These are:
Minister of Communications Canadian Radio-television and Telecommunications Commission Minister of Energy, Mines and Resources
Atomic Energy Control Board National Energy Board Minister of Finance Anti-Inflation Board Anti-Dumping Tribunal Minister of Labour Canada Labour Relations Board President of the Privy Council Public Service Staff Relations Board Minister of Transport Canadian Transport Commission
The situation with the remaining six bodies, classified according to minister responsible, is:
Minister of Consumer and Corporate Affairs
The activities of the Restrictive Trade Practices Commission are encompassed in the annual report of the director of investigation and research, both being bodies established under the Combines Investigation Act.
Secretary of State for External Affairs
Annual and other reports of the International Joint Commission and the Internationa! Boundary Commission are made public.
Minister for Energy, Mines and Resources
The Petroleum Compensation Board is established under the Petroleum Administration Act. Section 94 of that act requires the minister to prepare a report to be presented to Parliament on the administration of the act.
Minister of Finance
The Tariff Board is not required to report annually, but all reports, evidence and information (other than confidential material) on specific matters examined by the board must be laid before the Parliament.
Minister of National Revenue
Reports of the administrator under the AntiInflation Act are tabled.
Further information on reports and documents to be laid before the Parliament is obtainable from relevant statutes, and from the "List of Reports and Returns to be made to the House of Commons by Public Officers and Private Corporations" prepared for members by the Law Clerk and Parliamentary counsel.
4. None.

December 3, 1979


Mr. Lambert (Bellechasse): Was a study undertaken to ascertain the profitability of the possible 60,000 jobs cut in the Public Service and, if so (a) which sectors will be affected (b) how many lay-offs will there be in each sector (c) what will be the saving for each sector?


Sinclair McKnight Stevens: There has been no single study undertaken to determine the profitability of the 60,000 job cut. However, a board strategy to achieve this reduction has been developed and announced. The strategy is based on a reduction of 20,000 to be realized from the privatization of Crown corporations, a decrease of 5,000 in the agencies and Crown corporations that receive parliamentary appropriations but whose personnel resources are not subject to Treasury Board control, and a reduction of 35,000 in the controlled public service. The government also announced that one of its guiding principles in achieving these reductions would be reliance on attrition. As each phase of this strategy is implemented, studies will be undertaken to ensure that the cuts are designed to achieve the greatest possible savings for Canadian taxpayers.


Mr. Lambert (Bellechasse): Between May 22 and October 9, 1979, did the government conduct any studies re-evaluating the electoral position of the party in power and, if so (a) how many (b) what was the total cost?


John William Bosley: No. (a) and (b) Not applicable.


Mr. Pepin: 1.	For the fiscal year ended March 31, 1979, what amount of interest was credited to the (a) Public Service Superannuation Account (b) Canadian Forces Superannuation Account (c) Supplementary Retirement Benefits Account?
2.	What amount did each account receive by way of contributions in the same period?


Hon. Walter Baker (President of Privy Council and Minister of National Revenue):: 1 am informed by the Department of National Defence and the President of Treasury Board as follows:
1. (a) The amount of interest credited to the public service superannuation account during the fiscal year ended March 31, 1979 was $374,687,241. This represents interest earnings at a rate of 4 per cent per annum. Interest earnings over that amount (currently earnings from the difference between interest rates of 8 per cent and 4 per cent) are used to offset the cost to the government of amortizing over a period of five years, the liability created by salary increases.
(b)	$310,700,953.91
(c)	The amount of interest credited to the supplementary retirement benefits account was $36,680,602.
Order Paper Questions
2. The total amount of contributions paid into the public service superannuation account including government contributions, employee contributions and salary increase deficiency credits was $1,016,141,519.
The total amount of employee and government contributions paid into the supplementary retirement benefits account was $134,377,334.
Canadian Forces superannuation account:
Current contributions	$69,318,651.85
Arrears of contributions	$1,383,899.58
Transfers from other funds	$45,644.40


David Kilgour: Mr. Speaker, if question No. 548 could be made an order for return, because of its length, this return could be tabled immediately.


Mr. Speaker:: The questions enumerated by the parliamentary secretary have been answered.

Is it the wish of the House that question No. 548 be deemed to have been made an order for return?


Some hon. Members:: Agreed.


Mr. Friesen: 1.	How many works of art are in the collection at CBC headquarters, Calgary, Alberta and, what is (a) a description of each item, its purchase price and the name of the artist (b) the purpose of the collection?
2.	Does the corporation have other collections or does it plan any other collections?
3.	Is the collection added to on a regular basis and, if so, how are the works chosen?
4.	How were the original works chosen and what was the budget for each year since it was initiated?
5.	Who owns the collection, i.e. CBC Calgary or the corporation as a whole?
6.	For how long has it been CBC's practice to purchase art works for a collection?
7.	How many original works have been purchased by the corporation in the past ten years and, in each case, what was the (a) name of the artist (b) name of the work (c) purchase price?
8.	(a) How many collections does CBC have (b) where are they located (c) how many works are there in each collection (d) what is the estimated value of each collection (e) is any item ever loaned to a private gallery etc.?
9.	Does the corporation ever sell any of its acquisitions and, if so (a) what is the policy in this regard (b) how many have been sold to date (c) what policy does the corporation follow in the expenditure of this income i.e. is it used to purchase art?
10.	How does the corporation refer to such collections for the purpose of documentation, i.e. as an art collection or furnishings?
11.	(a) How are the art works displayed in each collection (b) what number are in public areas, private offices or are located in a gallery situation?

December 3, 1979
Voluntary Sector
12.	How many persons are involved in (a) choosing the works (b) maintaining the collection?
Return tabled.
[ Translation]


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


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Friday, November 30, consideration of the motion of Mr. Baker (Nepean-Carleton) (for Mr. MacDonald, Egmont):
That a special committee of the House of Commons be appointed to inquire into and report upon means to strengthen the role of the voluntary sector in Canadian society;
That the committee, taking into account the scope of activities now being carried out by the voluntary sector, the problems being faced by voluntary groups and the extent, nature and impact of current government support, report its conclusions and recommendations with respect to the measures that could be taken by the federal government to strengthen the role of the voluntary sector
(1)	as an objective that is desirable in its own right,
(2)	as an alternative to public dependence on government services, and
(3)	in ways that would enhance the ability of such groups to operate
independently of government
together with such other matters as the committee considers relevant;
That the committee submit reports from time to time, as appropriate, and in any case a final report not later than May 31,1980;
That the special committee be composed of seven members of the House of Commons to be designated at a later date;
That the committee have the power to appoint from among its members such subcommittees as may be deemed advisable and necessary and to delegate to such subcommittees all or any of its powers except the power to report directly to the House;
That the committee have power to sit during sittings and adjournments of the House of Commons;
That the committee have power to send for persons, papers and records, and to examine witnesses and to print such papers and evidence from day to day as may be ordered by the committee;
That the committee have the power to adjourn from place to place within Canada; and
That the committee be empowered to retain the services of expert advisers and to commission studies or research to assist in its work and that it also be empowered to retain such professional, technical, clerical and stenographic help as may be required.
Mrs. Margaret Mitchell (Vancouver East):: Mr. Speaker, I am pleased to speak on behalf of my party today in relation to the proposed special committee on voluntarism. I should like first of all to review the purpose of this special committee, which is to "inquire into and report upon means to strengthen
[Mr. Friesen.J
the role of the voluntary sector in Canadian society". Several questions need clarification, however.
First, what is meant by "voluntary sector"? I assume the government refers to non-profit activities in the fields of health, welfare, environment, recreation, education and many other community or national endeavours which are sponsored by private organizations rather than by governments, and which involve the use of volunteers or the participation of ordinary citizens.
We hear so much these days about government privatization, or "privateering" as we call it on this side of the House, or at least those of us in this corner, that we should perhaps clarify that this, indeed, is not what will be the concern of this committee. I assume this committee will not concern itself with the great debates on free enterprise versus public ownership, but will concentrate instead on human services that are primarily for the benefit of humanity, and are not concerned with profits in the material sense.
My next question then is, why do we need another committee to study the many aspects of voluntarism? I hope most members are aware that there was a lengthy report put out by the national advisory council on voluntary action called "People in Action", commissioned by the past Liberal government. It was published in September, 1977, after a three-year period of study that involved many groups across Canada.
This extensive analysis posed many valuable recommendations for government action. Why do we need another study committee? There are a few things the report left unanswered, including a clear definition and a listing of voluntary organizations that were involved. However, surely we do not need a repeat performance. We do not need another study on the need for action which would only serve to delay further action.
1 can only assume that the present government is suspicious of studies done by the previous government, and perhaps we should share their suspicion, even though the "People in Action" report appears to be fairly objective and even critical of the role of government in relation to voluntary activities. I appreciate, hopefully as a means of promoting action, that there has been a short time span designated for this special committee. I sincerely hope this means that action is intended in the very near future.
Whether or not this special committee can adequately study the scope of activities carried out by the private sector, the problems faced by voluntary groups, the extent, nature and impact of current government support, and report its conclusions, as has been suggested within this proposal, within six months remains to be seen. I know that there are certain organizations of poor people, such as the federation of antipoverty groups in British Columbia, which cannot wait this long to receive funds for such things as stamps, telephones, an office and a newsletter. I would ask the Prime Minister (Mr. Clark) to see that such priority requests are dealt with immediately.
December 3, 1979

The proposed motion states three objectives relative to strengthening the role of the voluntary sector: first, as an objective that is invaluable in its own right, and there is no real elaboration on that point; second, as an alternative to public dependence on government services; and third, in ways that would enhance the ability of such groups to operate independent of government.
If one were cynical, one might wonder if there is a hidden motive here. Is the hand of the President of the Treasury Board (Mr. Stevens)-the hand of the "slavish slasher"- looming over us to curtail, cut back and starve voluntary services? Is he also planning to rid the government of responsibility for essential public services? We on this side of the House will certainly be watchdogs to ensure that this is not the main interest of this government in reviewing the voluntary sector. In all seriousness, I hope that that is not the government's intention.
During times of high unemployment which create many economic and social stresses for families and individuals, the need for public and private services increases. The government must not pay for the national debt by cutting essential human services. We recognize the value of volunteer participation in both private and community services. Effective volunteer effort benefits the community, but it must also be satisfying to the volunteer. Training and support are very essential. The days of volunteering as a charity service are long gone. Now volunteer activity is a means of mutual help and learning.
In recent years there has been a major change in the nature of volunteer help. With the growth of welfare rights groups, citizen's action movements and self-help community services, the role of the middle class volunteer has changed. No longer do low income people who take pride in their own efforts and who want to be in control of decision-making in their own communites welcome the lady bountiful or the patronizing patrols who used to come down from the other side of town to do good. Indigenous members of low income communities want and have the right to funds, opportunities and training to develop their own leaders, their own programs and their own actions to solve community problems.
There are many new types of volunteer actions which are evolving, some of which were reported in the recent study I mentioned but many of which were not, and I hope that this committee will look at them. 1 am thinking particularly of new innovations such as were developed by low income people on welfare in Vancouver under a program called the Vancouver opportunities program. Under this program people on social assistance received an incentive allowance to work in the community to develop many self-help programs of their own and to grow and develop confidence which eventually led to their own employment. I understand that there is also potential for looking at this program in relation to unemployment insurance, where claimants in a voluntary way might give of their efforts and develop their own potential through community activities while unemployed.
As a result of these new developments and their self-help nature, many middle-class volunteers have had to find new
Voluntary Sector
ways to participate in their communities. They have become involved in their own community issues. So we see the growth of environmental people's movements, and we see new alliances and mutual partnerships being formed where people with a greater degree of education, skill and perhaps leisure time are sharing their skills as resource people with groups that need such expertise.
We recognize the value of volunteer participation, but voluntarism cannot replace the need for quality programs and services that are essential to meet the basic needs of Canadians. Essential services are a public responsibility available without stigma for those in need, and should be paid for by all of us through an equitable sharing of our tax dollars.
It is important that the proposed special committee confirm that approach as a basic first assumption and confirm the areas of community service that are a legitimate, essential public responsibility so that we not lose the programs which we have struggled so hard to establish over the past years. Public responsibility includes the provision of public health, medical care, adequate income supplements, pensions, employment services, social services-both preventive and remedial-child welfare and many broad educational and recreationals and para-professionals are needed. Most of them are government employees, but there is also a great potential for the use of volunteers as long as they are used in appropriate roles in public services as well as in private organizations.
I hope that these roles will be clarified in this committee with the agreement of organized labour so that people who wish to help as volunteers-perhaps in schools, in public health services and so on-may perform these satisfying and important tasks without replacing potential paid employees. Of course, there are many programs which are co-sponsored by public and private organizations in which volunteers are also active. I hope that these programs will also be considered.
We in this party agree that volunteer participation by citizens in social action and community programs is essential to democracy. We believe that government should encourage and actively facilitate such development. This is not to say that we necessarily agree that long established, highly institutionalized, self-perpetuating private agencies are all necessarily relevant to the needs of today. Many of them I think are not and should be reviewed.
Nor should such programs necessarily be funded at the expense of more dynamic, indigenous groups that have grown out of people's own needs and a desire to solve their own problems in communities. I hope that this committee will look at new self-help community services and people's movements which have emerged in recent years and which are not now a part of the welfare establishment. In fact, many of them have difficulty getting meagre funds allocated through community united appeals.
The role of advocacy groups in helping individuals who are beaten down by the red tape of bureaucracies and of groups which are pressing for institutional legislative reform is also very important. It is a very worth-while voluntary activity that is important to government if it is to function effectively

December 3, 1979
Voluntary Sector
because it provides the kind of criticism that is essential to review programs to make them more relevant to human needs. Studies of self-help volunteer action should also include the full range of citizen action groups which have emerged in recent years and have a voice in planning and improving communities. For example, neighbourhood improvement committees, local area councils and some other groups are all very important, as are tenant action groups and environmental groups.
There is now a great impetus in the anti-nuclear movement which promises to be active in the future as well. These groups are all important, as are the anti-poverty groups that 1 have mentioned. They are important not only in local communities but also as national movements which can have considerable impact on society and governments. Non-profit co-operatives in the areas of housing, food and day care, as well as many other kinds of community enterprises, are all forms of self-help volunteer activity. 1 expect and hope that the Conservative government will see this in line with their philosophy of trying to develop self-reliance and individual human rights. I am pleased to hear that the government has recognized co-operatives. I have heard that term used several times and it was included in the Speech from the Throne. I am anxious to see how this will be encouraged with the needed start-up funds and technical resources.
This committee should examine a new form of development, one which is not too prevalent in Canada but which could have great meaning. I refer to community development corporations. These can be organized with help in the beginning to train and employ local people to deliver the services needed in local communities. They can also develop expertise and business skills which may result in one very essential kind of job creation, as well as important services in the local communities.
These important aspects of volunteer activities in Canada often lead to needed reforms and contribute to the healthy development of self-reliant communities. People who participate in them develop confidence and skills that help them become more employable. Some go on to work in public life and some become politicians. Not only is it a service to communities and not only is it important as a form of active citizen participation, but it also gives great opportunities for individual growth in many ways.
I hope there will be greater recognition and support for the self-help movement as a very vital part of the volunteer sector in Canada which should be actively encouraged by this government.
I should like to note also that the "People in Action" report that 1 referred to earlier points out that some form of honorarium to cover the cost, at least, of child care, transportation, or the other expenses incurred by people who volunteer, particularly those in low income communities, is another element that should be considered carefully.

1 am pleased that there seems to be a very positive response from members to my proposal that a subcommittee on selfhelp voluntary action should receive particular attention from this committee.
I fully support the views of others who have spoken who say that priority must be given to grass roots community organizations, to volunteers working in local communities and citizen action groups, as well as local community service agencies.
In conclusion, Mr. Speaker, I should like to quote a passage from the "People in Action" report. I believe this statement might well form the basic assumption for the special committee which has been proposed. On page 134 of the report there appears the following statement:
The federal government has a responsibility to ensure that there is a general social, economic and political climate in which the basic needs of the people can be met, their basic freedoms can be exercised, and opportunities for growth and a better life can be accessible to all. Where equality of opportunity is not present, the government has an obligation to correct the imbalance. In particular, the government has an overriding responsibility to remove any and all barriers to equal participation in the democratic process and equal access to government. No person or institution should be in a privileged position.


Mr. Eymard Corbin (Madawaska-Victoria):: Mr. Speaker, if I rise today, it is to express my opposition to the arguments in favour of setting up this committee. I believe that the government, even though it is new at its job and is still a student government, cannot truly justify setting up this committee in view of the major cost in time, travel and money to those who will be on it.
Our major role should be to sit in Parliament when Parliament is in session, and to take part as much as possible in its work and committee work here in Ottawa. 1 have never been in favour of proposals aimed at making committees travel. 1 have had to sit on such committees in the past. I therefore speak from personal experience when I say that during their travels, these committes accomplish nothing which could not be done here in Ottawa.
Therefore, instead of setting up another committee, which, in my opinion, is a simple diversionary tactic to keep its backbenchers and perhaps opposition members busy, immediately after receiving the report of the Canadian advisory committee entitled People in Action, the government should have put a group of experts to work, because there are such experts in the government, very well paid and very able experts, I am happy to say. They should have agreed immediately to analyse the 80 or so most concrete proposals made by the Canadian Advisory Council and come back to Parliament with some sort of legislative statement of the type usually tabled as a white, red or green paper, I am not sure which, but with concrete legislative proposals which come immediately before the legislative process as such, and referred that document to a committee. I believe that the action taken by this government simply aims at delaying even more the implementation of the many excellent recommendations contained in this report.
December 3, 1979

Of course, the council did not exhaust all the arguments or all possible situations in its report, but the subject matter is sufficient for the government to take action as soon as possible and instead of looking for excuses by setting up another committee. 1 even believe that the motion to set up such committee could be interpreted as a slap in the face for those who have spent weeks and months to prepare their report, make their study and submit specific proposals.
In any event, had I been a member of that council, that is how I would react to the government's motion to set up yet another parliamentary committee. It certainly shows a lack of determination and of fortitude on the part of the government to take action when it already has the data required to legislate or at least-since legislation may not be necessary-to issue statements of policy which would be guiding lights for all voluntary groups throughout the country.
Should the House authorize, today or at some later date, the setting up of this committee, I hope that its members, the seven or so members chosen from either side, will have the basic common sense not to crisscross the country and consult, as is usually the case, only the experts in the various types of voluntary action or the various voluntary sectors in Canada, but that they will consider also the situation in which the beneficiaries of voluntary action find themselves. They are very often the first to be forgotten when a committee is established. 1 say that from experience. For example, Mr. Speaker, I can quote a press release issued by the Minister of Employment and Immigration (Mr. Atkey) on June 8 when he decided to order the proclamation to enact on July 1 the last provisions of Bill C-14, the legislation amending the Unemployment Insurance Act. The minister said that he was not satisfied with current conditions but, and I quote from page 3 of his statement:
During that study the government will thoroughly consult the provinces and the private sector-
We have a fair idea of what "private sector" means. They are those who pay part of the contributions to the unemployment insurance scheme. They are generally the companies which more often than otherwise object to that contribution. The press release goes on:
-to make sure that their concepts and views will be taken into consideration.
Nowhere in that press release is there any mention of the claimants, those who receive unemployment insurance benefits or the poor workers.
Mr. Speaker, I want to make sure that, should it be decided to set up that special travelling committee, someone will go out into the field. The only justification for authorizing the committee to travel is to go and see the people who benefit from voluntary services throughout the country because, to my mind, those who are really interested in the work of the committee could easily come to Ottawa themselves. As in the past, the committee would approve their expenses, which is something all committees do, since we would stay here to enable a great number of hon. members to participate in the work of the committee. I am also against the idea that the
Voluntary Sector
committee should be composed of only seven hon. members. The work should go on here. This committee should give a large number of hon. members a chance to participate in its efforts.
Mr. Speaker, as the former speaker said, and as I have already mentioned, we received the report of the adivsory committee; no mention is made, which I sincerely regret, in the motion of the House leader or in the speech of the Parliamentary Secretary to the Secretary of State (Mrs. Stratas), to the fact that the report was requested by and presented to the immediate predecessor of the present Secretary of State, the hon. John Roberts. Mention could at least have been made to the fact that it was an excellent initiative of the former secretary of state but, for some reason that escapes me, nothing was said about that; I have a feeling someone wants to give the public the impression that nothing was done before in that very interesting and certainly very worthy field of endeavour, that of voluntary organizations in Canada.
Mr. Speaker, if at least the government spokesmen had recognized the essential role of the Canadian family in a strong national structure, I would have been half satisfied. But here again no mention has been made of the basic role of the Canadian family in the welfare of the whole Canadian society, as if the very important role of the Canadian family in the stability of the nation has been deliberately downgraded. And voluntary groups will never be able to replace the family, the obligations, the responsibilities of the father and mother. 1 deeply regret this omission by the Parliamentary Secretary to the Secretary of State who, two weeks ago, talked out my private motion in which 1 proposed to establish a national family week in Canada. And I find that the reasons given by the government to kill my bill are the same as those given today to justify the establishment of that special parliamentary committee.
I simply cannot understand that attitude, but 1 have reasons to worry about the general direction taken by the new government in the area of social policy, of policies affecting the basic unit of Canadian society, the family cell.
1 wish to conclude my remarks because I said to the President of the Treasury Board (Mr. Stevens) that I would not take too much time, and I know he has an important duty to fulfil. Mr. Speaker, we cannot be against voluntary groups any more than we can be against motherhood or fatherhood or family or all the decent institutions in our society. So I shall accept the verdict of my colleagues who are favourable to the establishment of that committee, even though the government did not convince me of its necessity. I seriously question the reasons of the government, as did our party's spokesman Friday afternoon, and 1 intend to keep a very critical eye on the work and travels of the members of that committee and I shall certainly scrutinize the report that they should submit to us within six months.


@Acting Speaker: Is it
the pleasure of the House to adopt the said motion?

December 3, 1979
Cost Overruns


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

Sinclair McKnight Stevens: That a special committee of the House of Commons be appointed to enquire fully into the measures necessary to prevent recurring cost overruns on major government projects (defined as those involving expenditures in excess of $1 million) and in particular
(1)	to carry out a review and an analysis of the measures already taken by the Treasury Board to prevent cost overruns on major government projects, and assess their impact;
(2)	to examine measures in place or planned in departments in respect to present or future major government projects, with a view to assessing their compliance with Treasury Board guidelines and directives; and
(3)	to examine major government projects that will be referred to the committee by the President of the Treasury Board, where the Treasury Board has identified a cost overrun;
That the special committee be composed to seven members of the House of Commons to be designated at a later date;
That the committee have power to appoint from among its members such subcommittees as may be deemed advisable and necessary and to delegate to such subcommittees all or any of their powers except the power to report directly to the House;
That the committee have power to sit during sittings and adjournments of the House of Commons;
That the committee have power to report from lime to time, to send for persons, papers and records, and to examine witnesses and to print such papers and evidence from day to day as may be ordered by the committee;
That the committee have power to adjourn from place to place within Canada; and
That the committee be empowered to retain the services of advisers to assist in its work and that it also be empowered to retain the professional, clerical and stenographic help as may be required.
He said: Mr. Speaker, if the House were going to pass this motion automatically, maybe I would have nothing further to say. On the assumption that hon. members would like a brief explanation of what we have in mind respecting this special parliamentary committee, perhaps I should take a few minutes to explain why the government is asking for the establishment of this committee.
I would like to say that I find the debate on the establishment of a special parliamentary committee on project cost overruns is, if you like, an opportunity welcomed by myself so that I may share with this House the government's concerns regarding the provision of ever costlier services to the public.
I have stated on numerous occasions that reducing both the presence and the cost of the federal government in the economy of our nation is our first priority. One important step in reducing government expenditures is through more frugal and efficient utilization of resources. The purpose of my comments now is to present to this House the reasons why this government has felt it necessary to ask a parliamentary committee to
[The Acting Speaker (Mr. Scott, Victoria-Haliburton).]
examine major projects undertaken by the government, and their associated costs to the taxpayer.
It is not unusual that governments undertake projects which for a variety of reasons eventually cost much more than anticipated. Canada has had its share: the hydrofoil and the Bonaventure and I could name more. What concerns me, however, is that notwithstanding our earnest efforts to minimize the increase in expenditures of projects, the federal government, now and in the past, appears to be plagued with projects which are not, and cannot, be completed within budget.
In saying this, it is not my intention to allocate blame but rather to focus attention on the situation, to bring it into the open, and to discuss it in a public forum in order to arrive at a course of action which will correct this drain on public funds.
Let me also hasten to add at this time, Mr. Speaker, that many, indeed, the majority of government projects are managed efficiently with due regard to prudence and economy. Nevertheless "most" is not good enough; we must continuously strive to improve until the federal government is achieving high standards of efficiency and effectiveness in the management of all of its projects.
What then appears to be the main problem with government projects experiencing cost difficulties? The essence of the problem which distresses this government is the large discrepancies between the funds initially approved for projects and the final costs to completion, together with an attitude that once a project is approved all necessary funds will somehow be forthcoming to ensure its completion.
The Auditor General of Canada states in his one hundredth annual report:
Capital cost estimates at all stages of the planning process should be realistic and complete, covering all aspects of the project. A revised estimate based on the actual design, schedule and site conditions should be prepared before seeking final approval. The effects of possible future inflation should be considered separately from other cost-increase factors. Estimates should be expressed in both current and anticipated future dollar values.
The Auditor General goes on to cite examples of capital projects which experienced inordinate cost escalations. Indeed, the 12 projects identified by the Auditor General had initial cost estimates of $281.6 million but resulted in expenditures of $699.7 million, an increase of almost 150 per cent. Our Standing Committee on Public Accounts is currently reviewing these projects, but they are by and large completed. I am confident that every member of the House will look forward to their findings, but what I am concerned about, Mr. Speaker, is the present, the ongoing projects which are currently off the rails.
Recently, this government directed the Treasury Board secretariat to conduct a study which will identify the scope of the cost overrun problem as well as the difficulties in the various stages of decision-making, funding, contracting and implementation where departments need assistance in coming to grips with trade-offs, such as site reconnaissance to identify alternatives; feasibility studies to determine the best approach using common costing techniques; detailed design and costing
December 3, 1979

by phases; inflation contingencies in materials and labour; international monetary fluctuations; project management and funding operations; and project deferment or schedule extensions due to restraint needs or priority adjustments.
Initial results of this study verify, as I have already mentioned, that everything is not bad. Approximately 75 per cent of our projects are completed at or below budgeted forecasts. Some of the remaining 25 per cent, however, are projects which we feel should be examined to determine the major causes of, and identify the measures needed to prevent cost overruns.
I am not suggesting that we have been sitting on our hands in providing guidance to departments on project management while determining the magnitude of this problem. Major initiatives have been taken in the development of directives, guidelines and suggested practices which will ensure the establishment of improved systems and procedures. I would like briefly to review a number of these.
In June, 1978, the Treasury Board issued policy and guidelines on the management of major Crown projects. A revised version of this circular was incorporated in the administrative policy manual under the heading "Management of Major Projects in September of this year. This document addresses in detail the over-all planning, budgeting, execution and control of major Crown projects. The policy deals with such questions as: single point leadership and the interdepartmental organization of these projects; the consideration of socio-economic objectives; the approval process; the resolution of disputes; and the control and evaluation of projects. A major Crown project is a project of a value in excess of $100 million, or a lesser value but deemed to have a major social, environmental and economic impact and a significant level of political sensitivity and public visibility. Projects falling under this policy include the new fighter aircraft, the Canadian patrol frigate, the search and rescue satellite, the Leopard tank and the nuclear icebreaker.
Following the Treasury Board's issuance of the policy relating to major Crown projects, two follow-up activities were undertaken. These were a simplified version of the policy and guidelines, as a working guide for departments to be used generally for smaller projects referred to as "Management of Projects-Aide Memoire" issued in September, 1979; and a policy statement on the process for the identification, provision and remuneration of qualified project leaders for major Crown projects, also issued in September, 1979. Additionally, as a direct result of this government's concerns with respect to project management, accountability concepts, cost overruns and requests for retroactive approvals, Treasury Board issued "Directives on Cost Control" in July of this year.
In this circular letter 1979-20, deputy heads were informed of the requirement of the ministers of the Treasury Board for increased control over the expenditure of public funds in the implementation of all government projects, be they capital or operational in nature. This directive requires departments and agencies to submit to the secretary of the Treasury Board a
Cost Overruns
complete list of all approved capital and operational projects where the total estimated cost to completion exceeds $500,000.
Another requirement of this directive is that a project manager be appointed for each project which may require contract or project approval by the Treasury Board, and that the project manager be answerable to his deputy head for achieving the planned results within budget. The circular letter goes on to state that the Treasury Board will not entertain submissions requesting funds for cost overruns, nor requests for retroactive approvals. In order to provide the needed incentive for complying with this directive a sanction has been included as follows:
When a project exceeds the approved budget, including allowances for contingencies, and the cause of the overrun is considered by the ministers to be the result of inadequate management, a penalty may be levied against the responsible department in an amount up to twice the total overrun. Whether this penalty will be levied against current or future departmental programs will be at the discretion of the ministers.
In order to deal with this difficult problem of cost overruns, the government announced in the Speech from the Throne on October 9 its intention to create a select parliamentary committee on major government projects. This intention was formalized in the draft motion tabled on November 5.
It is proposed that this committee be given a mandate to inquire fully into reasons for which overruns have occurred and consider the measures necessary to prevent recurring cost overruns in connection with major government projects. More specifically, it will be asked to carry out a review and analysis of the measures already taken by Treasury Board to prevent cost overruns on major government projects and to assess their impact, as well as to examine measures in place or planned in departments with respect to present or future major government projects with a view to assessing their compliance with Treasury Board guidelines and directives. In addition, the committee would be asked to examine major government projects which would be referred to it by the President of the Treasury Board where Treasury Board had identified a cost overrun. It is the intention of this government to see the problems of project management and cost overruns discussed in public in order to arrive at a proper understanding of the underlying causes and to further improve the efficiency and effectiveness of government operations while, at the same time, emphasizing that the majority of government projects are properly managed.
The government feels that a select parliamentary committee is the ideal vehicle to accomplish this purpose. It can work closely with the public accounts committee which reviews the past expenditure of funds and discusses observations contained in the Auditor General's reports. The select committee will focus on current projects with a view to recommending corrective action for the future.
To deal specifically with the question of why we believe a committee is needed to deal with current projects, first, a select committee would be focusing sharply on one specific aspect of government activity while the public accounts com-
1942

December 3, 1979
Cost Overruns
mittee involves itself with total government activity, not with respect to project management alone but with respect to government expenditure generally.
Second, 1 would point out that the select committee we are contemplating would, under its mandate, focus its attention on current activity in connection with major projects. As well, the public accounts committee has normally restricted itself to examining departmental response to observations made public by the Auditor General. This frequently involves a time lag of one to two years between the observation being made and corrective action being taken. In short, a select committee could concentrate on procedures for prevention rather than simply on examination after the event.
Earlier today the hon. member for Saint-Henri-Westmount (Mr. Johnston) asked me why 1 thought a special committee should be set up. It might be helpful if I could give hon. members an insight into a few of the projects before us which might well be referred to such a committee for study and recommendation as to what we at the Treasury Board can do to arrest the dreadful outflow of money that is occurring.
1 referred earlier to a project known as Montreal MAPP involving the construction of a postal plant. Mr. Speaker, I am glad you are sitting in your chair because this is going to startle you. Approval was originally given in 1974 for the expenditure of $161.2 million on that project. At the present time it is estimated the final cost will be $273.6 million, which means an overrun of $112.4 million or, in percentage terms, 69.7 per cent. Surely, every member of this House is bound to ask himself whether he ought to resist the setting up of a select committee to look into that kind of thing.
It is not just the cost overruns that concern us. This program, if completed, is going to be completed 37 months later, it is estimated, than the date originally established. This may well be one of the projects 1 would refer to the select committee should Parliament see fit to set it up.
Earlier 1 referred to the Prince Rupert grain dryer. Approval was originally given to the allocation of $705,000 for the construction of this project. The final cost is now estimated to be $3,812,000, or an overrun of $3,107,000-in percentage terms, 439 per cent. Moreover, Mr. Speaker, that project will be eight months late if it is finished by the new due date.
1 could read into the record comments made in my briefing document explaining how we got into this position. In this case, the case of the 439 per cent overrun, 1 asked certain officials: can we assume, if this last amount of money they have requested is forthcoming, that that will be the end of it and we will finally have a finished grain drying facility in Prince Rupert? All they can say is: "We hope so, Mr. Stevens." 1 hope the new committee will look into this situation and tell us whether there are any new steps we should be taking to ensure that these cost overruns are arrested and that if we do agree to further funding, no additional funding will be requested.
In case you may think such things happen only in Canada, Mr. Speaker, let me take you to Paris, to the chancery they are
building there. The cost originally estimated for that complex was $4.5 million. It is now estimated that the final cost will be $8.98 million, that is, an overrun of $4.4 million or in percentage figures 96.6 per cent.


An hon. Member:: Do they have a Liberal government?


Sinclair McKnight Stevens: Surely, every member of this House, if he were talking to a constituent back in his own riding, would have to agree that we owe it to the Canadian public to look into overruns of this kind, not in the abstract, not after they have become history, but today while the projects are still under way. The French authorities now estimate the chancery will not be completed until June of 1981.
Let me give you another example, Mr. Speaker. You have heard of Mirabel airport. The original completion date was to be late in 1974. The actual completion date was 12 months later and there are still things that need to be done with regard to land acquisition. The original cost of constructing the airport and acquiring the land was estimated to be $243,495,000. That is what, initially, the government of the day said would be the total cost. Well, the final cost was $360,667,000 for an overrun of $117,172,000, or 48 per cent. That is only part of the story, Mr. Speaker. The adjacent land which was orginally said to be needed for Mirabel was supposed to cost $86 million to acquire. The final cost is likely to be $142,136,000, an overrun of $56,136,000 or 65 per cent.
Surely, these four examples I have given should be sufficient, though I could talk literally for the rest of the afternoon about other projects which are coming down the pike toward us, projects where massive cost overruns are anticipated. Within the context of what I am saying it surely behooves every member of the House to support this resolution, which would ensure that a special committee is set up to look into specific ongoing projects which are subject to cost overruns for which somebody should be answering to the Canadian public.


Donald James Johnston: Mr. Speaker, I was interested in hearing the remarks of the President of the Treasury Board (Mr. Stevens) both during the question period this afternoon and in explaining the purpose of this motion to our fellow parliamentarians here in the House.
One might say that I have an axe to grind with regard to this particular motion inasmuch as I am chairman of the public accounts committee. I would like to assure the President of the Treasury Board that everyone on this side of the House, I am sure everyone on his side of the House and even all the members to my left can agree on one thing, and that is that government mismanagement of public funds must be arrested and efficient procedures introduced to prevent some of the so-called "horror stories" as that term has been used frequently in the past with regard to several, or many, projects which have taken place over many years. The reasons for that are manyfold. It has been an experience which many countries have suffered due to the extraordinary expansion of expenditures in the government sector and the lack of controls one

December 3, 1979

might find in the private sector where there is a bottom line at which to look. That is not the case, as we all know, in government.
So I can say to the President of the Treasury Board that I am terribly concerned about the management of government funds. In fact, I think I can say that that is one of the principal reasons I got into politics. I think that is true of many people of the young generation of politicians coming on stream, if I may use that term, at the municipal level, the provincial level and federal level.
Waste of public funds has been reflected in our whole fiscal apparatus. I have been told that we have seen an increase, for example, in tax evasion in this country. I believe that is partly because the public perceives that its funds are being squandered, mismanaged by bureaucrats, that there is fat in government and so forth. Accordingly, they have decided that they are just not going to pay the government funds to be squandered in that fashion. I think that is a general perception on the part of the public which we have to remove.
To that extent I basically agree with everything the President of the Treasury Board has said except with the necessity of appointing a special committee of this House to take on what is clearly the mandate of the Standing Committee on Public Accounts of this House of Commons.


Some hon. Members:: Hear, hear!


Donald James Johnston: The minister has said that the public accounts committee has been concerned with matters which have arisen in the past. Historically that is the case, and 1 believe that when the President of the Treasury Board was first elected to this House, that indeed was the case. The public accounts committee normally looked into so-called horror stories and summoned people before it to find out what happened and why. There was much publicity and much media coverage. There were examinations into cost overruns, as in the case, hon. members may recall, of the aircraft carrier HMCS Bonaventure, which was one of the celebrated studies of the public accounts committee.
However, in the mid-1970s and beginning after the appointment of the current Auditor General, Mr. Jim Macdonell, the entire role and perception of the public accounts committee have changed. As we know, the office of the Auditor General was given extended powers in the amendments to the Auditor General Act in 1976, which basically introduced the concept of comprehensive auditing: "Is the Canadian public getting value for money?" The Auditor General has a mandate to look into the economy, efficiency and effectiveness of government programs: and in keeping with that mandate, the role of the public accounts committee has also changed because, as hon. members are aware, the committee receives an automatic reference of the annual report of the Auditor General of Canada.
That automatic reference, in 1978, included a large portion of that work devoted to comprehensive auditing and special studies which the Auditor General and his staff had taken upon themselves in pursuing their mandate to introduce into
Cost Overruns
various government departments. I refer specifically, for example, to the study of procedures in cost effectiveness. If one looks to the report of the Auditor General of 1978, one will find in chapter 3 an analysis of basically the very matters which the President of the Treasury Board tells us we now need a special committee to look into, namely, planning capital acquisition projects.
I am not going to take hon. members of this House through the report of the Auditor General, but if they look at that report they will find that the Auditor General has established audit criteria which are to be followed in planning major capital acquisitions for the very reason that the President of the Treasury Board has suggested. We have to stop this haemorrhaging.
Let me just give a summary of the audit criteria which have been suggested by the Auditor General and were applied by the Auditor General's staff in analysing a series of capital acquisition projects, a number of which I might say have already been considered this very year by the public accounts committee. 1 refer, for example, to the celebrated cost overrun of the Calgary airport, and whereas the President of the Treasury Board says that he is interested in ongoing projects and not what happened in the past, I am completely satisfied that the public accounts committee is also concerned more with ongoing projects than with what happened in the past. What happened in the past is sad and unfortunate, but it is water under the dam, spilled milk or whatever term one might apply.
The fact is that we are primarily concerned not even with what is going on today but with what is going to go on for generations, the future structures we wish to establish to control and examine the efficiency, the economy and the effectiveness of government spending in this country, so that the public will regain confidence that its funds are being properly managed. I hope that the initiatives which have been taken by the Auditor General and which, by and large, will be supported, I hope, by the public accounts committee and by its reports to this House will in turn serve as an example to provincial levels of government, municipal levels of government and, in fact, any organization of any kind which is concerned about the mangement of public funds, be they universities, hospitals, charitable organizations and so forth.
The audit criteria which are set forth in chapter 3 for planning capital acquisitions are as follows: "Responsibility and accountability should be clearly defined and communicated". That criterion was tested against a variety of projects to determine whether it was followed. Second, "Requests for funds should be supported by accurate and complete documentation' . Again, that audit criterion was tested against various projects to determine whether it had been followed. "Final approval should be based on full information". Again, that was tested against the Calgary airport, the schools in the north on Indian reserves and the acquisition of class R icebreakers by the Department of Transport. We have already looked at these areas to determine these criteria and the others to which I am about to come were followed. "Project implementation should

December 3, 1979
Cost Overruns
be properly controlled". Finally, "Completed projects should be reviewed". 1 am only touching upon the headings, not what follows from those basic criteria.
In the public accounts committee we in turn are endeavouring to determine, by working with and by questioning the Comptroller General, the staff of the Treasury Board, the Auditor General and the various departments, whether these criteria are acceptable and effective. And, complementary with that, the Comptroller General, as many members of this House know, has been conducting, basically, studies on improving the practices and controls within the various departments. With this study called "IMPAC", the Comptroller General in turn has a mandate to determine that each one of these departments is going to meet the criteria with respect to planning capital acquisitions which are set forth in the report of the Auditor General.
What we are hearing from the President of the Treasury Board is all very well, but it is a complete duplication of effort.
1 cannot see how any special committee charged with the mandate which the minister hopes to give it can avoid dealing specifically with the same audit criteria we are dealing with in the public accounts committee. In turn, what kind of image is it to portray to the Canadian public to get committee upon committee to examine what the Auditor General has proposed to us and what we have already undertaken to test?
I would not want to estimate the cost of that exercise and, in addition to that, I am particularly concerned because this will clearly draw upon the expertise of the office of the Auditor General which we need in the public accounts committee. It will probably draw upon the time of members of the committee who should be concerned about what is being done in public accounts. Also it should do no more than confirm the very report which we in the Standing Committee on Public Accounts will make to Parliament on the planning of capital acquisitions. So the whole thing to me is senseless in that context. It suggests to me that the President of the Treasury Board does not really know what the report of the Auditor General contained or what is going on in the Standing Committee on Public Accounts, because he insists on referring to this committee as a committee which is dealing with skeletons of the past, instead of one which is looking forward to the future and trying to establish proper management controls in every department of government,
a (t6io)


An hon. Member:: It is a Tory witch hunt.


Donald James Johnston: 1 am afraid there is a complete misconception in the mind of the President of the Treasury Board on this particular point.
Great accent was placed by the President of the Treasury Board on the fact that he was not dealing with the past. Yet in one of the very examples he cited, Mirabel airport, we are committee? When I look at the terms of the motion contained in today's order paper, I see nothing which suggests that this talking about a completed project. What is the mandate of this
[Mr. Johnston.)
committee is to look at ongoing projects only, as was suggested by the President of the Treasury Board, both in his remarks and also in response to questions which I put to him this afternoon. The only departure from the consistent position he took was with regard to Mirabel. As I pointed out, it is a project in the past which, it would seem to me, would fall clearly outside the mandate that he indicated he intends to confer upon this particular committee.

Mr. Speaker, I am somewhat nonplussed. This may be because 1 chair the committee, but it seems to me that if we are going to be efficient in the management of government business, responsibility should lie squarely with the standing committee of the House that has the mandate. There is another aspect to this problem. It was decided in 1957 by a Progressive Conservative government to have an opposition member chair the committee. That Progressive Conservative tradition has always been followed since. It is a very important tradition because it gives the committee an objective perception, with the chairman coming from the opposition. The same tradition now exists in England. And it seems to me that the proposal to have a government member as committee chairman reduces that committee's objectivity.
1 submit that if we accept the principle that there should be an opposition member to chair the Standing Committee on Public Accounts, it follows that the chairman of the proposed committee should also be chosen from this side of the House. Otherwise, there is the risk of creating a political forum rather than a committee with a genuine concern for the responsibility of managing public funds.

As Mr. Speaker might gather from my remarks, I for one am not happy with the possibility of the creation of another committee to duplicate the work of a respected committee of the House. I am very proud of the work of that committee, as I think other members will be, particularly when the session finishes. It distresses me to think that perhaps we may be drawn into some kind of political witch hunt in a special committee which the President of the Treasury Board wishes to initiate.


An hon. Member:: That is the purpose.


Donald James Johnston: That being said, if members of this House-

They are laughing Mr. Speaker, I wonder why. Let them laugh, 1 shall be laughing in turn. Anyway, Mr. Speaker, if the House insists on the establishment of this committee, 1 would propose an amendment, an amendment to the terms of the motion.

Specifically, I would suggest that this motion be amended to reflect the mandate which the President of the Treasury Board


UHBHHHHHHI
[Stage Direction]
December 3, 1979
[Stage Direction]
tells us will be the terms of reference of the committee, namely, the examination of major ongoing government projects. He said that in his view the Standing Committee on Public Accounts looks at history. I do not agree with that, but accepting that interpretation for the moment, and assuming that it is the wish of members of this House-to give that interpretation to the terms of reference of the Standing Committee on Public Accounts, I would insist that this motion be clarified so as to make it absolutely clear that it is concerned with ongoing major government projects.
Therefore, looking at the English version, I propose, seconded by the hon. member for Ottawa Centre (Mr. Evans), that the word "ongoing" be added after the word "major" in the third line of the motion. Thus the opening paragraph of the motion would read as follows:
That a special committee of the House of Commons be appointed to inquire fully into the measures necessary to prevent recurring cost overruns on major ongoing government projects (defined as those involving expenditures in excess of SI million) and in particular-
The rest of the motion would remain the same. I formally propose that amendment.
Before concluding my brief remarks, I might add that the motion, as amended, is entirely in conformity with the raison d'etre of this special committee as expressed to the House in the comments of the President of the Treasury Board during his presentation in support of the motion this afternoon, and also in response to the questions 1 put to him earlier during oral questions today.
Walter David Baker: Mr. Speaker, 1 rise on a point of order. 1 understand that there is no written draft of the amendment available yet, but that one is being prepared now.


Donald James Johnston: Right.


Walter David Baker: While we are waiting for it to be prepared, did I hear the hon. member correctly to say that the word "ongoing" was after the word "recurring", in the third line, and before the word "cost"?


Donald James Johnston: No. The word "ongoing" is after the word "major". It will read, "major ongoing government projects".


Walter David Baker: Thank you.


The Acting Speaker (Mr. Scott, Victoria-Haliburton):: Order, please. I understand we will wait for the hon. member for Saint-Henri-Westmount (Mr. Johnston) to present his amendment in writing.


Walter David Baker: That is right.


Mr. Knowles:: Agreed.


The Acting Speaker (Mr. Scott, Victoria-Haliburton):: Is
the hon. member for Saint-Henri-Westmount ready?
Cost Overruns


Donald James Johnston: Mr. Speaker, could 1 present the amendment?


The Acting Speaker (Mr. Scott, Victoria-Haliburton):: It is moved by the hon. member for Saint-Henri-Westmount (Mr. Johnston), seconded by the hon. member for Ottawa Centre (Mr. Evans), that motion No. 5 on the order paper be amended in the first paragraph by adding the word "ongoing" after the word "major" so that the paragraph would read as follows: That a special committee of the House of Commons be appointed to inquire fully into the measures necessary to prevent recurring cost overruns on major ongoing government projects (defined as those involving expenditures in excess of SI million)-
I would now invite views from both sides of the House on this amendment.
[ Translation]


Mr. Gauthier (Roberval):: Mr. Speaker, I would simply point out that it is impossible to be against the amendment because it is stated in paragraph 2, and I quote:
-present or future major government projects-
We are inserting "ongoing projects". The term is repeated, and nothing more.


The Acting Speaker (Mr. Scott, Victoria-Haliburton):: Is
the House ready for the question?


Stanley Howard Knowles: On the amendment.


The Acting Speaker (Mr. Scott, Victoria-Haliburton):: On
the amendment. Does the House adopt the said amendment?


Walter David Baker: Mr. Speaker, 1 listened with considerable care to the speech by the hon. member for Saint-Henri-Westmount (Mr. Johnston). He was arguing very effectively and very eloquently for the work of the Standing Committee on Public Accounts, but when 1 compared what he had to say with what was said by the President of the Treasury Board (Mr. Stevens) in moving the motion, I was struck with the positioning of the word "ongoing". It is quite difficult for us to define what is an ongoing project in terms of the kinds of things that are envisaged by this amendment.
For instance, the President of the Treasury Board mentioned the Mirabel airport. Because aircraft are using that airport, and in terms of the cost overruns that are involved, is it to be said that it ceases to be a case where cost overruns in the present sense could not continue? 1 have in mind particularly what the President of the Treasury Board had to say about land acquisitions around the airport and the tremendous costs that are being imposed upon the people and the Government of Canada in respect of the operation of the airport.
What I am saying to the House is that 1 think it is important that this be considered not only in terms of the work of the Standing Committee on Public Accounts, but also in

December 3, 1979
Cost Overruns
terms of what the opposition is attempting to do by placing the word "ongoing" where it is proposed. I hope the President of the Treasury Board will come into the House so that I can discuss the matter with him in detail, because what really concerns me in regard to the work of this committee, given the terms of reference with which the President of the Treasury Board dealt, is that members of the opposition in this House who were members of the former government are very skilfully and artfully attempting to draw a curtain over several major government projects and contracts which can be defined as those involving expenditures in excess of $1 million. This would put them beyond the purview of the committee for consideration as undertakings or expenses of the government in relation to ongoing overruns. This is a very artful attempt, in my judgment, subject to the judgment of the President of the Treasury Board, to draw down a curtain. If that is in fact what is happening, under the guise of suggesting that this would contravene or interfere with the work of the committee on public accounts, I am really quite surprised.
In terms of these contracts or arrangements, 1 do not think we can say with precision what is the sense of the word "ongoing". When the President of the Treasury Board comes into the House he may be able to satisfy me regarding that matter, but I am concerned that the inclusion of the word "ongoing" will limit the ability of the committee of this House to inquire into ^ whole host of rather large projects which are now generally regarded as a problem for the Government of Canada. These projects may have been regarded as a problem for the former government. If they were not so regarded, they should have been.
I listened to what the hon. member had to say, and I certainly would not want to put a bad face on it, but I am not certain what the significance is of that word "ongoing" and its positioning, unless it is an attempt to draw a curtain over certain classes of contracts in respect of which this committee will not be allowed to deal.
Quite frankly, I had hoped there would not be an attempt by this House to limit the work of parliamentary committees. We are concerned with what is generally recognized as a very important consideration to the operation of government, namely, why millions and millions of dollars seem to be underestimated in relation to a host of government contracts. Was there something wrong with the estimating procedures? There is a whole host of similar questions that were supposed to be dealt with by this committee.
I am surprised at what the official opposition is really attempting by this amendment. The only purpose I can see is to limit the right of a committee of the House to examine these matters, and to limit the mandate of that committee as granted to it by the government's motion No. 5. Government motion No. 5 asks the House of Commons to appoint a special committee:
-to inquire fully into the measures necessary to prevent recurring cost overruns on major government projects-

How can there be any serious objection to such a motion? Quite frankly, it was not clear in the speech made by the hon. member for Saint-Henri-Westmount why the amendment was proposed. It is the first time in my experience in this House that 1 have heard of the opposition attempting to limit the work of a parliamentary committee investigating the matter of government expenditures, cost overruns, and what have you. I am quite startled by such a move. I can only conclude that this amendment came off the top of the hon. member's head, because he did not have it prepared in writing. I hope that someone in that party will answer that question.
Is there something which the former government is attempting to cover up? I do not know. If there is nothing they want to hide, I think that the amendment should be withdrawn so that the fullest of consideration can be given to the motion by the government. The motion was proposed because there is a problem. If one has followed the awarding of tenders on government contracts for certain fixed amounts of money, or if hon. members have followed the proceedings of the Standing Committee on Public Accounts or other committees of the House, they will know that there are always applications for more money for extras on all contracts. The question is, why does that happen? What is wrong with the practice and where should it be changed to ensure that the tender system and the estimating system are appropriate? Are there new methods of arrangements for the letting of contracts that ought to be employed, both io expedite contracts and to ensure that the contractors get their fair amount? Why is it that these things occur? Is there some experience from the past that we can draw on that will help us chart a course for the future?
Is it the intention of the official opposition, for the first time in my history here, to limit an inquiry that, if they are on their toes, will be carried by the opposition anyway? That is the position in which we find ourselves, and I hope that debate will continue with respect to that one question. I am prepared to give the hon. member for Saint-Henri-Westmount an opportunity to explain why he would like to limit that inquiry, because 1 would certainly like to know. It is not our wish to precipitate or lengthen debate with respect to the matter.
1 would like to know the opposition's position. Certainly the explanation given by the hon. member for Saint-Henri-Westmount does not satisfy me and, as he knows, I tried to follow his speech very closely. I thought that the President of the Treasury Board, both in answer to his question and in the House earlier today, explained well why he felt that the motion should be framed in the way it is. The minister referred to many projects which would now be considered old projects. The hon. member for Saint-Henri-Westmount ought not to muzzle the work of the committee. When the committee gets into the discussion of how it will interpret its terms of reference, it may very well decide that it will look at certain projects in certain ways. I do not think we should fetter the work of the committee in advance.
With respect to the foreign investment review committee, hon. members will recall that on Friday there was an explanation asked of the government by the hon. member for Win-
December 3, 1979

nipeg North Centre (Mr. Knowles). I indicated the government's view. The government would like this select committee to have as broad a reference as possible so that it can decide the areas in which it will undertake its work.
I hope that the hon. member will answer the question with regard to his amendment. As to why he did not answer in his speech, 1 do not know, but I invite him to answer and to indicate why, for the first time in history that 1 can recall, there is an attempt by the official opposition to limit an issue which is being sent to a committee of the House of Commons. Is there something which I do not know? Is there something which the opposition is trying to hide?


Allan Joseph MacEachen: You obviously don't know.


Walter David Baker: The opposition House leader says that I do not know. He is quite right. I have been in government for only six months and have not had a chance to delve into many things. I must say that I am a little alarmed not only at the proposal to limit the work of the committee, but also that it would be supported by my good friend, the opposition House leader, because I would think that he, in his position, would want the fullest possible scope given to the committees.
That is the reason for my intervention. I am very concerned about this attitude which would somehow propose to limit a government proposal to Parliament. I hope that this approach of limitation is not supported in this House. I would hope that the wish of all members of the House would be to have the fullest possible scope in the terms of reference of committees so that the committees may decide for themselves whether they wish to limit the reference. There has been too much limitation put on committees of this House. This is one committee to which the government has given broad terms of reference, and I hope that the House will support those terms of reference.


Donald James Johnston: Mr. Speaker, on a point of order, could I have some clarification on my position. I have been asked a question by the government House leader, and I would like to know at this point if I have the opportunity of responding to that question.


The Acting Speaker (Mr. McCain):: To answer the question, I would think yes.


Donald James Johnston: Thank you, Mr. Speaker. I had thought that during my speech the government House leader was in the House, but it is apparent from his remarks that he was not, or that if he was here physically, he was not here in spirit. I made it very clear at the outset that cost overruns were the purpose, the raison d'etre, of the Standing Committee on Public Accounts. I was not suggesting that we should in any way fetter parliamentary inquiries into the activities or projects in question. I simply make the point that the public accounts committee is a standing committee of this House and has a permanent order of reference from the Auditor General's report to look into those very projects. The government simply wants to add another committee that will duplicate the work of
Cost Overruns
the public accounts committee at the expense of the Canadian public.


The Acting Speaker (Mr. McCain):: Order. I suggest the hon. member is now approaching debate and that his point of order has been made.


Stanley Howard Knowles: Mr. Speaker, some minutes ago I thought that the Chair had declared the amendment carried, but then the President of the Privy Council (Mr. Baker) got up and spoke as though he thought he was speaking to the amendment. I gather that the House is acting as though the amendment is still before the Chamber. Does Your Honour want to straighten that out?


The Acting Speaker (Mr. McCain):: The matter is still before the chamber. The amendment was not carried.


Stanley Howard Knowles: I am prepared to accept that. I think there has been a fair amount of misunderstanding. At any rate, we are still debating it and it seems to be the hope that if members can speak as freely and lengthily as did the President of the Privy Council, the President of the Treasury Board (Mr. Stevens) may eventually get here. I am surprised that he ever left the chamber when this important motion was before us.
I must say to my friend the President of the Privy Council that I am startled at his being startled at this motion, as though it has a restrictive effect. As I heard the speech of the President of the Treasury Board, his main justification for this committee alongside the public accounts committee, was that the public accounts committee deals with history and this one will deal with the present and the future.
I gather that all that the hon. member for Saint-Henri-Westmount (Mr. Johnston) wants to do is to make sure that the new committee will not go back into questions of ancient history. He wants the committee to have the power to investigate ongoing major government projects. 1 suspect that Mirabel is past, present and future, so it is ongoing. The amendment will not cut that out. I suspect, however, the amendment would cut out an investigation into the activities of Colonel By when he built the Rideau Canal!


Mr. Nystrom:: And Stanley was here.


Stanley Howard Knowles: Is that not what the hon. member for Saint-Henri-Westmount wants, namely, to ensure that this new committee will not conflict with the public accounts committee in being able to go back and dig up old projects that are completed? In other words, the new committee, in the terms of my hon. friend's amendment, would be able to deal with projects starting now or projects already in place which are continuing.
If that is the basis, I believe the President of the Privy Council ought either to accept the amendment or give us the same kind of undertaking that he gave us on Friday with respect to the committee on FIRA. We were concerned then

December 3, 1979
Cost Overruns
that the motion did not cover something we felt should be covered. The President of the Privy Council gave us an assurance that it did, and we were satisfied. Perhaps he could now give us an assurance that there is to be no investigation into the building of the Rideau Canal, that there is to be no overlapping of the public accounts committee in the sense that this committee will investigate things on which the books are closed. The public accounts committee is there to do that and we hope that its activities in that direction will continue.
At any rate, Mr. Speaker, that is my purpose in intervening at this point. I do not want to repeat myself a dozen times just so the President of the Treasury Board can get here. Perhaps others can do that. 1 believe that there is reasonable sense to the amendment that has been proposed and that the President of the Privy Council should have no difficulty in accepting it. We do not need to divide the House on this. Why does the government House leader, on behalf of the government, not say that this is acceptable, or at least give an interpretation of the motion that covers it?
1 see that though the President of the Treasury Board has not come back, we have gone higher and got the Prime Minister (Mr. Clark) back. Maybe this matter can be resolved without its becoming a major issue on which we have to divide the House on a Monday afternoon.


Allan Joseph MacEachen: Mr. Speaker, I am pleased that the Prime Minister (Mr. Clark) is in the House. I did not expect this bonus five or ten minutes ago when 1 planned to speak.
I want to begin with the point I would have begun with in his absence, namely, to ask where the President of the Treasury Board (Mr. Stevens) is. If this were an isolated absence on the part of ministers, then I would not complain. We had a similar experience when the House was asked by the Minister of National Health and Welfare (Mr. Crombie) to establish a committee to look into the problems of the handicapped: neither the minister nor his parliamentary secretary found it possible to come into the House either to participate in the debate or to listen to the presentation made, presumably on their behalf, by the hon. member for Brandon-Souris (Mr. Dinsdale). That was the first incident when neither a minister nor a parliamentary secretary came into the House to defend the motion being put forward by the government.
1 was prepared to overlook that, Mr. Speaker, but on Friday afternoon the House had to deal with a second important committee-important in the view of the government-to establish a review of the Foreign Investment Review Act. For a good portion of Friday afternoon the Minister of State for International Trade (Mr. Wilson) was not in the House. The hon. member for Winnipeg North Centre (Mr. Knowles) complained about that. This afternoon the President of the Treasury Board has missed a certain portion of the debate.
I do not want to say anything further, except that if the Prime Minister is serious about his respect for Parliament, then he must ensure that ministers are present in the House when important motions standing in their name are moved and

defended. This is one of the fundamentals of ministerial government.


Charles Joseph Clark: Such hypocrisy.


Allan Joseph MacEachen: If the hon. member is suggesting to me that I look after my business and let the Prime Minister look after his business, then 1 want to tell him that what I am talking about is the business of the House of Commons. If the President of the Privy Council (Mr. Baker) seeks co-operation to get his measures through the House, co-operation which we wish to give, then the most elementary thing he has to do in order to secure that co-operation is have ministers present to explain and defend their motions in this House.
That is the first point, Mr. Speaker. I appeal to the Prime Minister, who has made a fetish-almost an obsession-of declaring his respect for Parliament. Since this session began we have had incident after incident where that fundamental interest has been lacking. I want to express my complaint in that respect.
The President of the Privy Council has suggested that we have some sinister motive in moving an amendment to this particular motion. I want to assure him and members of the House that the proposed amendment was an effort to put into practice the principle which the President of the Treasury Board enunciated today in question period and, I understand, later in his speech.
We examined this motion and wondered why the government proposed to establish a further special committee on cost overruns when the public accounts committee is equipped to deal with that very subject. We know that we have many committees in the House of Commons. We are adding to them with a profligacy I have never seen in this House before. We therefore wonder why we should have a further special committee when we have an existing committee which can do the very task that is to be assigned to the special committee.
That is why the question was addressed, before the debate began, to the President of the Treasury Board. I do not have to go into the argument that was advanced by the youngest member of the Privy Council in saying that the President of the Treasury Board told us this afternoon that he wanted the public accounts committee to deal mainly with history and the special committee to deal mainly with what I understood to be ongoing projects. We are not happy with that but we think it is a better situation than a total duplication.
in order to improve the situation, we proposed the amendment, not to limit the inquiry because inquiries can move apace in the public accounts committee, but at least to reduce what appears to us to be duplication. That is the sole purpose of the amendment.


Walter David Baker: Mr. Speaker, I rise on a point of order. I appreciate very much what the opposition House leader has said. I wish to indicate to him that the inclusion of the word "ongoing" within the motion in the place
December 3, 1979

indicated in the amendment moved by the hon. member for Saint-Henri-Westmount is quite acceptable.


Some hon. Members:: Hear, hear!


Walter David Baker: 1 understand the thrust of it now as it was explained to me by the hon. member for Winnipeg North Centre, and it is quite acceptable.


Allan Joseph MacEachen: Mr. Speaker, 1 understand I have the floor. I yielded the floor on a point of order. It was not a point of order, but clearly a statement by the President of the Privy Council. Do I have to sit down and listen to another speech?


Mr. Kempling:: Mr. Speaker, 1 rise on a point of order. I just want to correct the opposition House leader-


Allan Joseph MacEachen: Your Chinese friend.


William James Kempling: -my Chinese friend, Gambay. In his remarks, he commented that the Parliamentary Secretary to the Minister of National Health and Welfare (Mr. Schellen-berger) was not in the House on Friday. I can assure him that he was here all through that debate. In fact, he was trying to rise to speak in the debate.


Allan Joseph MacEachen: Mr. Speaker, I want to thank the chief government whip for clarifying that point. I regret that the parliamentary secretary did not, in the normal way, lead the debate; I understand the purposes. But I do want to thank the Prime Minister for coming into the House, accepting the amendment and putting the President of the Privy Council straight once again. I wish he would come in more often.


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


An hon. Member:: Question.


The Acting Speaker (Mr. McCain):: Shall the amendment carry?
Amendment (Mr. Johnston) agreed to.


Mr. Simon de Jong (Regina East):: Mr. Speaker, I think the events of the last three quarters of an hour could have been put into five minutes had the government been on top of things and had the President of the Treasury Board (Mr. Stevens) been here to see his motion through the House. It is an important motion and there are a fair number of implications in it.
The present chairman of the public accounts committee has made a very good case to rely upon that committee, although I can understand the motivation behind the government's wanting a special investigation into government cost overruns. There is no doubt but that there have been some very serious and major cost overruns amounting to billions of dollars. I understand the desire of the government to get a handle on this and to investigate why these overruns occur and be able to put
Cost Overruns
a stop to them. As a member of the public accounts committee, reviewing the report of the Auditor General and listening to some of the testimony I have been amazed by the lacklustre administrations in the past. I was amazed when I discovered that in public services over 50 per cent of the contracts were entered into without tender, and that 10 per cent of the contracts were done totally on an oral basis, without any written document. I stated in committee that this was a Mickey Mouse operation. It just blew my mind, Mr. Speaker. There is no doubt the Auditor General has zeroed in on this insanity in his report and that he has made some worth-while recommendations to stop it in the future.
On the one hand, we recognize the importance of the public accounts committee, but on the other hand we recognize the desire of the government to give particular attention to cost overruns. I am glad that the government has accepted the amendment. I think the motion as it stands is strengthened and we will be supporting it.
It has often been suggested that members in this particular corner of the House are crazy spenders and that we are really not concerned with a properly managed government enterprise. This is far from the truth. If one looks at the record of the provincial government of Saskatchewan, one will find that the public debt is very low. In fact, in 1976 it was the lowest in the country. Perhaps for the record I might just include figures concerning the public debt in the various provinces. For example, the public debt in British Columbia was $1,840 per person; in Alberta-such a rich province-the figure was $1,880 per person; in Saskatchewan the figure was only $960; in Manitoba the figure was $2,589; in Ontario, another Conservative province, the figure was $2,059; in Quebec the figure was $1,803; in New Brunswick the figure was $1,978; in Nova Scotia the figure was $1,886; in Prince Edward Island it was $1,042; and in Newfoundland, $3,274. It was the socialist province of Saskatchewan that had the lowest debt per capita.
We have one of the best managed government operations in Saskatchewan. We do not allow the type of cost overruns that the previous Liberal government and the various Conservative governments throughout this country have allowed. If there is a cost overrun, it is not added to the general budget. What happens in Saskatchewan is that another department or another project is cut. Throughout the seventies Saskatchewan has had balanced budgets. If a deficit does occur in one year, it is then made up in the other year. The province of Saskatchewan has had sound business practices.
The federal government meanwhile has experienced major deficits not only in government spending and overruning of costs, but also on the revenue side. Such giveaways as MURBs and drilling incentives have made the revenue side a very uncertain factor. There have been major giveaways resulting in some major deficits.
We have also experienced ongoing deficits in the country because of the general economic picture. For example, slowdowns in the economy and an improperly planned economy result in declines in government revenues.
1950

December 3, 1979
Law of the Sea
Before we can really tackle the problem of government deficits, we must have a much more stable economy. We must have a planned economy where one is able to predict economic trends and put in proper government expenditures with the knowledge of how the whole economy will operate in the years ahead. As long as we have economic anarchy we will never be able to properly control all the expenditures.
I hope as well when the government sets up the committee that we will also look into the possible cost overruns on the mortgage insurance tax credit scheme. I think this is Pandora's box. Again, it is one of those projects that the present government has every right to condemn the former government for doing. I am afraid the present government is making the same mistake in carrying on in the same tradition. There are no decent controls on the scheme and there is no proper way of forecasting how much it will cost. I think we will end up with many of the problems that we have experienced in the past.
So we will support the motion, Mr. Speaker. We hope something decent and good will come out of it, although 1 am afraid, given the reality as a whole, I do not believe this committee will have the power to properly control government spending.
Motion, as amended, agreed to.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. McCain):: Order. 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 Mississauga North (Mr. Jupp)-National Defence-Contract for Cruise missiles; the hon. member for Vaudreuil (Mr. Herbert)-Treasury Board-Sale of Crown corporation to private enterprise; the hon. member for Burnaby (Mr. Robinson)-Energy-Government control over oil prices.
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.


PRIVATE MEMBERS' MOTIONS
The Acting Speaker (Mr. McCain):: Is it the pleasure of the House to give unanimous consent to stand motion No. 9?


Some hon. Members:: Agreed.


LAW OF THE SEA
Mr. Keith Penner (Cochrane) moved:: That, in the opinion of this House, the government should continue to work to achieve agreement on a comprehensive and broadly supported law of the sea treaty through the United Nations Conference on the Law of the Sea and that such a treaty should provide for an international seabed or ocean authority to regulate the exploitation of deep ocean minerals in an equitable manner, with appropriate roles for private, national and international entities and that a significant portion of ocean mineral revenues, both offshore and in the deep ocean, should be regarded as "the common heritage of mankind'- and used in a "Common Heritage Fund" to assist developing nations, to fight pollution, and to assist the work of the United Nations, especially in the area of peacekeeping, along the lines of the 1978 proposal of the government of Nepal.
He said: Mr. Speaker, last week some hon. members of this House were treated to an inspiring and most thoughtful address by Dr. J. F. Leddy, president of the World Federalists of Canada, when he spoke to the annual meeting of the Canadian World Federalist Parliamentary Association. 1 would very quickly report to the House that the Canadian World Federalist Parliamentary Association now has 130 paid up members, members of Parliament and senators. At our meeting last week we elected a new president, the hon. member for Waterloo (Mr. McLean). We look forward to the high quality of leadership which we know this new member of Parliament will provide for our association.
I should also say a word in the way of tribute to the past president, the hon. member for Windsor-Walkerville (Mr. MacGuigan), who served our association extremely well for a long period of time.
In introducing my motion today, 1 would like to begin by quoting very briefly from Dr. Leddy's speech which 1 believe sets the tone for the motion I would seek support for from hon. members. Dr. Leddy said:
What will future historians think of our times? What will be their view of our stewardship of civilization . . . Ask young people in North America today what label will probably be applied to the twentieth century, and they will usually emphasize the marvels of science and technology, of air travel and space exploration, of communication through radio and television. Some will speak of a greater degree of social and political democracy.
If one interrupts this glowing litany to point out that many millions in the world have enjoyed little if any of these benefits of our century, these students are genuinely surprised and uneasy to be reminded, as well, that there have been two world wars, destroying many millions of lives, that two atom bombs were dropped, wiping out 250,000 lives in a flash, that six million Jews were killed in cold calculation in the Holocaust, and that even after the war there has been, year after year, the never-ending plight of hordes of refugees, fleeing in misery as the result of some new commotion in Europe or Asia or Africa or South America. One should add to this grim list the collapse of democratic regimes in many parts of the world, and the recurring misery of famines, remedied too little and too late.
My motion, which has the support of the Canadian World Federalist Parliamentary Association, proposes that a significant portion of ocean mineral revenues, both offshore and deep ocean, be regarded as the common heritage of mankind and used in a common heritage fund. To do what? As the motion says, it is to assist developing nations, to fight pollution, particularly ocean pollution, to transfer marine technology to developing countries and, finally, to assist the work of the
December 3, 1979

United Nations Organization, especially in its responsibilities for international peacekeeping. This common heritage fund, very simply stated, is a major instrument for promoting economic and social justice, environmental sanity and peace.
Some members may ask, does not such a proposal as contained in this motion run counter to the establishment of the 200-mile economic zones in the process of being implemented by many of the coastal nations? The answer is no. The proposal which was put forward by the leader of the delegation of Nepal to the Conference on the Law of the Sea in May, 1978, would accept the establishment by treaty of a 200-mile economic zone in which coastal countries would be sovereign and would have ownership of all the resources. According to the proposal, however, mineral resources, including gas and oil, would be subject by treaty to a sliding scale tax to a maximum of 20 per cent. This tax would be contributed to a common heritage fund.
The minerals within the exclusive economic zone, the EEZ, would continue to be the exclusive property of the coastal state in exactly the same way as a home owner's home in his or her exclusive property. In the same way that a home owner is required to pay a tax on his exclusively owned property, the coastal state would be taxed on the revenues from mineral exploration and development in its exclusively owned economic zone.
We know that some coastal states are rich and some are poor. Therefore, there would have to be a scale of contributions which any coastal nations would make. This would vary inversely with the per capita gross national product. The richer coastal nations, Canada included, would contribute much more to the common heritage fund while the poorer nations would contribute less or perhaps in some cases nothing at all.
About 70 per cent of this fund would be directed to development in the Third World while the remaining 30 per cent would be administered by an international seabed authority for agreed upon purposes. Those purposes would have to be negotiated. In 1970 the United Nations general assembly endorsed the common heritage principle. Members will realize immediately that this is not a new idea or some harebrained scheme. Referring to the principle, they said the seabed and ocean floor beyond the limits of national jurisdiction are the common heritage of mankind. It is very interesting to note there was little dissent at the time, perhaps because the resolution of the general assembly did not define the limits of national jurisdiction.
Then as the United States, in particular, and Canada as well, increased the limits of their territories along with other coastal nations of the developed world to 200 miles from the traditional three-mile and 12-mile limits, it became increasingly clear that the common heritage on which everyone was agreed at one point in time was shrinking and shrinking fast. It was shrinking not because the 200-mile limit makes huge inroads on the world's seabed acreage, but rather because it came slowly to be understood that the real ocean wealth lay within 200 miles of shore. This is because as much as 93 per
Law of the Sea
cent of recoverable hydrocarbon reserves of oil and gas lie within that margin of the coastal shelves of the world. On the other hand, what mineral wealth lies on the bottom of the sea beyond the coastal shelf is difficult or impossible to extract and will yield next to nothing in revenue by comparison to the estimated two billion barrels of proven oil reserves closer to shore. The effect, therefore, of excluding the developing world from any significant share of oil and gas revenues within 200 miles of shore would be to make the rich even richer, as, indeed, would 80 per cent or more of those revenues in any case, and at the same time to make the poor very much poorer by comparison.
If we survey the coastal regions within 200 miles of the coastal nations of the world we find that there would be 25 million nautical square miles of exclusive economic zones, or EEZs, as they are called. Should all the profits accrue to the coastal nations by a law of the sea treaty, more than 50 per cent would accrue to only ten nations and more than 75 per cent to the first 22 nations on the list. To put it in another way, more revenues would accrue to 13 developed nations than to all 120 countries of the Third World combined.
Let us look at the growth situation and the capital requirements of the Third World in the second United Nations development decade and try to reach some conclusions. In order to achieve a 6 per cent growth rate annually in the Third World it is estimated that the yearly flow of capital to the Third World would be in the order of about $50 billion. Current forecasts, however, show that based upon the average aid target of less than 1 per cent of gross national product per year which the developed world has committed to these countries, there will be an anticipated shortfall, or deficit, in the order of about $18 billion a year.
What would the Nepal proposal do with respect to such a shortfall? For those of us who think that the immediate potential of the seabed is unlimited, it may be surprising to learn that the Nepal proposal would yield only about $5 billion, or less, to the common heritage fund in the early years, though perhaps more later on. So the shortfall for the needs of the Third World even with the common heritage fund remains very significant indeed. However, at least some portion of the deficit would be covered in this way.
By comparison with these figures, we have available to us the payout figures under the present draft treaty. This draft treaty, by the way, will be coming before the Law of the Sea Conference when it next meets. If this document were to be enshrined in a treaty consequent action would generate about a quarter of a billion dollars in revenues; that is, $250 million compared to the Nepal proposal yielding $5 billion. And we are talking about a deficit in the Third World of $18 billion. This quarter of a billion dollars would come principally from the nodules of nickel and other minerals on the sea floor. Very little of it would come from the profits of oil and gas. In other words, in 1985 the proposal put forward by Nepal would net 16 times more for the common heritage fund than the proposal now favoured by Canada.

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Hon. members should be reassured, in the interests of Canada, that the proposal which was put forward by Nepal and which is gaining support every day in the developing world poses no problem at all with respect to the legal status of the EEZ-the 200-mile limit. It does not bring into question sovereign jurisdiction over that zone, although 1 might say in passing that recent actions of the Government of Canada in giving up a significant part of that jurisdiction to the provinces may seriously tie our hands when it comes to future international co-operation for Third World development.
In short, therefore, the issue here is not in any way a legal one, but it is certainly a moral one. It is a question whether developed nations with a sea coast will limit their greed and be willing to invest a fair portion of the return from the earth's coastal resources in a common heritage fund for mankind. As someone closely involved in the debate for the establishment of a common heritage fund so aptly put it: "It is one of the greatest and most painless opportunities for international justice that has ever existed or is ever likely to exist."
What works against the success of such a proposal to share this wealth is, of course, greed and avarice. This is greed and avarice at the expense of the developing world. This leads us to the kind of situation which Dr. Leddy described to us in his speech last week. It is what the 1970 U.S. resolution had in mind. It is also the consideration which gave focus to early sessions of the Law of the Sea Conference. But Nepal's representative at the Law of the Sea Conference put it much better than I can. With this quote, I conclude:
If the Law of the Sea Conference fails, it will be because we, the participants in it, did not hold high the idea of the common heritage fund. We did not do that because in spile of our awareness of new challenges facing the earth and its inhabitants we are still victims of narrow, self interest. Look at the results. Most of mankind's share of ocean resources has been thrown into the coffers of a few rich countries.


Mr. Joe Reid (Parliamentary Secretary to Postmaster General and Minister of the Environment):: Mr. Speaker, this government most assuredly joins with the concerns of the hon. member opposite when he speaks about the abuse of our environment all across the world. In addition, we join with him in his expression of concern for the favourable and progressive development of those nations now emerging-what is called the Third World. More particularly, I would like this evening to assure the hon. member that the government would like to express its complete agreement with the hon. member's motion when he calls on the government to "continue to work to achieve agreement on a comprehensive and broadly supported law of the sea treaty through the United Nations Conference on the Law of the Sea and that such a treaty should provide for an international seabed or ocean authority to regulate the exploitation of deep ocean minerals in an equitable manner, with appropriate roles for private, national and international entities".
Canada is on record. Since 1967, when Ambassador Pardo of Malta introduced before the United Nations general assembly a proposal calling for the UN to undertake the
"examination of the question of the reservation exclusively for peaceful purposes of the seabed and ocean floor and the subsoil thereof, underlying the high seas beyond the limits of present national jurisdiction and the use of their resources in the interests of mankind", Canada has energetically supported and pursued, in the context of those negotiations attempting to promote an over-all agreement on the use of the oceans, the principle of reserving the deep seabed beyond those limits, in the interests of mankind generally and under the term "the common heritage of mankind".
Canada was among the 35 countries on the original ad hoc committee set up by the general assembly in 1967 to conduct an examination of this issue and was also represented on the new 42-member permanent committee on the seabed formed in late 1968 to continue the work of that ad hoc group. At the 25th session of the general assembly in 1970, this committee was further expanded to comprise 86 members, exactly the same number of states which participated in the 1958 and 1960 Geneva Conferences on the Law of the Sea. At the same time the general assembly decided that a third Conference on the Law of the Sea should be held in 1973 and assigned to the expanded seabed committee the mandate of preparing for that conference. The general assembly resolution underlined that a single comprehensive convention was necessary because of the interrelationships among all ocean uses and activities. At the same time it gave the seabed committee some special tasks in preparing for the conference, in particular the completion of a comprehensive list of subjects and issues for the future convention to cover.
The decision to convene a new Conference on the Law of the Sea required lengthy and difficult negotiations in light of the wide divergence of views regarding the scope of the Conference and the priority attaching to the various issues it would have to consider. Canada was among those countries-mainly the developing states-favouring a conference broad in scope and according priority to the seabed regime as against the more restricted conference favoured by a number of other states which wanted only matters of direct interest to be included in considerations. It was and remains the Canadian view that no accommodation on the Law of the Sea issues could be successful unless it was a comprehensive accommodation on all major issues. A partial solution would be no solution at all in the long run.
In the end it fell to the Canadian delegation to chair the negotiating group seeking an accommodation among these conflicting views and to bring about agreement on the compromise resolution which was finally adopted. That resolution, introduced by the Canadian delegation on behalf of its many sponsors, called for a conference to deal with a broad range of issues, including the establishment of an equitable international regime-including international machinery-for the seabed and ocean floor beyond the limits of national jurisdiction and a precise definition of this area to be included in the term "seabed".
At the same time, the general assembly passed resolution 2749 declaring principles which would form the basis for a

December 3, 1979

new regime governing the uses of the seabed, ocean floor and the subsoil thereof beyond the limits, again, of national jurisdiction.
That resolution represented a major landfall in that it constituted the first and only consensus of the international community in this field and laid the foundation and framework for the international seabed regime. In essence, the resolution affirmed the following principles:
First, there is an area of the seabed and ocean floor which is beyond the limits of national jurisdiction and which constitutes the "common heritage of mankind''.
Second, this area is not subject to national appropriation or claims of sovereignty.
Third, the exploration and exploitation of the resources of the area shall be governed by an international regime and international machinery, still to be established, and shall be carried out for the benefit of mankind as a whole, taking into particular consideration the interests and needs of the developing countries.
Fourth, the area shall be reserved for exclusively peaceful purposes.
Fifth, every state shall be responsible for ensuring that activities in the area conducted by its agencies or entities or persons under its jurisdiction shall be carried out in conformity with the international regime.
The acceptance of these far-reaching principles ranked in importance with the agreement on the applicability of a similar principle to outer space and celestial bodies. It represented a bold new approach towards a developing world order and a turning away from traditional land-oriented concepts of jurisdiction and sovereignty. Most significantly it put the general interest of the world community ahead of the special interests of any state or group of states. It is a concept holding great promise for the world of tomorrow.
Many years of work have followed these early attempts by the UN General Assembly to define principles to govern the regime of the deep ocean seabed. The third Conference on the Law of the Sea was convened in 1973 to elaborate a multilateral convention to bring into effect the principle of "the common heritage of mankind".
This country is dedicated to the establishment of such a deep ocean seabed and dedicated to that common heritage of mankind.


Edward Allan Miller: Mr. Speaker, 1 congratulate the hon. member for Cochrane (Mr. Penner) for bringing this matter to the attention of the House. I think it is an extremely important issue which we have to continue to pursue for the developing countries. If we look at it from a selfish point of view, I think we also have to support this motion from Canada's point of view.
As the last speaker mentioned, the Law of the Sea Conference has been going on in the third session since 1973. I had the pleasure of going to the Law of the Sea Conference in New York this past summer and, if anything, the surprise I
Law of the Sea
experienced there was the difficulty of the developing nations to make any inroads in gaining access to what we all accept as the common heritage of mankind. At that conference there are many pressures to gain the resources and the wealth that those resources promise to the world community. Developing nations, many of which are landlocked, have very little economic or political clout at the United Nations except in the formation of groups of other landlocked developing states.
From Canada's point of view, we have gained considerably from the progress which has been made at the Law of the Sea Conference since 1973, and we should be aware that that convention has not been signed. There are many outstanding issues still to be resolved, and until those issues are resolved we do not have any long-term guarantee that every nation in the world will recognize a 200-mile economic zone. We do not have any long-term guarantee that those same nations will continue to respect Canada's 200-mile jurisdiction over our very profitable and growing fish resources. We have taken on an obligation, through agreement and consensus at the Law of the Sea Conference, which sees Canada's management of those resources off our shores. There is an understanding that those minerals found within 200 miles are also the property of the sovereign state on whose continental shelf those resources lie. My concern-and I am sure the concern expressed by the hon. member for Cochrane-is that the developing nations are going to be squeezed out of the profits which may come from those resources.
If I may just reflect on some of the attitudes which I saw dealing with seabed mining, the attitude of Canada and other nickel and copper producing states was that they were demanding a certain ceiling and a certain timetable for the export of those ferro-manganese nodules. We were demanding a timetable and a ceiling in the recognition that if those resources were exploited rapidly by those nations which are capable of developing them-mainly the United States, West German and Japanese interests-Canadian jobs and the Canadian nickel industry would be particularly harmed. We understand why the United States, West Germany and Japan were and are anxious to mine the seabed. They are importers of nickel for industrial steel. They need those resources to become self-sufficient in their industries. Canada, Indonesia, and Guatemala were not very anxious for those resources to be developed in a hurry.
But what about the developing nations, the nations which do not have the technology or financial resources to exploit those reserves? Where do they stand? This is an attempt to assure the developing nations that they can gain some of those resources. Canada and other developing nations have a vested interest in saying that. We share wealth in oil, natural gas, and nodules which are expected to provide billions and billions of dollars of wealth to the world. We must look at that wealth in terms of how much it will cost to draw those off the seabed, to process them and ship them to areas where they can be utilized. We must consider how many developing nations there

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are. There are probably 119 or 120 nations which do not have capabilities at this moment to utilize those resources. We expect they will share in our deep sea deepbed mines. This is why 1 say we do not have any choice in the matter, except to pursue an adequate and equitable sharing of those resources.
Other issues in which Canada is interested at the moment include the delimitation of the continental shelf. Not all nations in this world accept that the continental shelf should extend only to 200 miles. There are other proposals which suggest any distance off the coast of a nation where it can be shown that that shelf is actually a prolongation of that nation. There are some nations which demand the entire shelf. 1 hope Canada would not be in that position. There are other nations which indicate that 200 miles is the limit, regardless of the continental shelf and regardless of the terrain in the area. Nepal suggested that within 200 miles there should be a sharing of the resources in that area.
Also we are informed by some nations, including the United States, that there is a reluctance when the world authority and the Law of the Sea Conference discuss the matter of having a world authority to govern seabed mining activities, by which the authority would set up an enterprise to develop the capability of seabed mining and sharing with the developing nations. There is a reluctance on the part of the United States to share the technology which it is developing now and which it will have to develop to mine those seabeds. There is a reluctance on the part of the nations and the companies capable of doing that, a reluctance to share the technical resources needed by developing countries.
Within the Law of the Sea Conference there is a mechanism by which we would settle international disputes. We must continue our presence at the Law of the Sea Conference in order to see the proposed mechanisms or the alternatives to them. The Law of the Sea Conference must continue with Canada's presence and leadership. Canada has played a leadership role at the Law of the Sea Conference. We have done well in fisheries. We have done well in providing ourselves with the opportunity to manage fish stocks off our coasts. We have done well in accepting the responsibility to control pollution within that area. We could have developed a greater leadership role, and 1 hope we will in the future.
The matter of continuing to work toward an international agreement through the Law of the Sea, respecting the sharing of a seabed authority and the resources of the seabed, will not be argued by this party. Again we encourage the present government to assemble the kind of staff which was sent to Law of the Sea Conferences in the last six years to continue that type of leadership role. 1 hope the new government will see to it that Canada is prepared to fight for an adequate and equitable share of the resources to go to developing nations, more so than was done at the last Law of the Sea Conference in New York. If some of the developed, wealthy nations do not begin to compromise on sharing the riches of the seabed, it is my fear that those other nations will not ratify the Law of the Sea Conference and therefore will not ratify the EEZ, our control over fisheries, our control over pollution and the con-

trol which nations have over navigation and management of resources.
In closing I should like to indicate that again the hon. member has done a service to this House. I encourage the government and all parties in the House to support this resolution so that developing nations will realize that by compromising and giving Canada and other coastal nations access to those resources, in turn we are prepared to share some of the income we gain from those resources with the world community.


Mr. Walter McLean (Waterloo):: Mr. Speaker, I should like to join with the hon. member for St. Catharines (Mr. Reid) and the hon. member for Nanaimo-Alberni (Mr. Miller) in paying tribute to the hon. member for Cochrane (Mr. Penner) for bringing this significant motion to the attention of the House. Also I should like to say a word of appreciation, echoing the sentiments of the hon. member for Cochrane, for the comments and the address at the annual meeting of the Canadian World Federalist Parliamentary Association of Dr. J. F. Leddy, as he set in context our world community and reminded parliamentarians of our responsibility to be part of the peacemaking process.
I should like to say a word of appreciation to the hon. member for the ingredients which are part of his motion, as expressed and brought to the attention of the House. It is apparent to all of us today, as we look at our world, the hourly reports from Iran, the reports from the Middle East, and as we receive into the Canadian community more refugees, that we increasingly need mechanisms for world order. In terms of the future, one point of hope for the great multitude of our human family is the manner in which we manage and order the life of the seas.
When we consider that in so many areas now the resources of our land are increasingly being depleted, one area of hope for the future surely is in the harvesting of the resources of the sea and the seabed. I want to suggest that in linking together this resource with our Canadian commitment to working together through the forum of the United Nations, the hon. member is pointing to the direction in which we, as a nation, have been and will wish to continue. I think that this discussion in this House at this time is timely, as I understand there is shortly to be named the make-up of the review members for foreign policy and for development assistance for the 1980s and 1990s, and in the review of that parliamentary process surely the experience and the work which has been done through the years by this conference must be weighed and considered very seriously.
1 want to suggest that we, as Canadians, have a great deal to offer to the continuance of this conference with our long history in fisheries, being a trading nation and dependent upon world order and world markets. We are also a people of humanitarian spirit, and we can see in the motion that we wish to be a part of those who bring some hope to the needy in our world.
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This motion is also important as it challenges us to look at our own national negotiations between provinces and the federal government, and in understanding some of the complexity and the time span of the Conference on the Law of the Sea we know just how painstaking and how carefully our negotiations have to be undertaken across this nation.
At the moment, as we are seeking to find ways of sharing the resources of oil and energy across our nation, we can understand how fearful certain parts of our nation are lest they not have the resources to meet their basic energy needs.
Similarly, this motion points us to the broader family concern in our world beyond our Canadian family, and to the same types of concerns which are being felt around our world. Surely something which Canadians and this Parliament can be sensitive to is both the time-frame and the sensitivity of these negotiations.
Many of us have had the opportunity to visit nations which are landlocked, and the motion gives expression to the sense of hopelessness of many of these nations, in Africa particularly, and other parts of the world. We have been, through C1DA, through other mechanisms and through the voluntary sector, seeking to relate, but what many of us have come to realize, and what many of the international organisms have come to realize, is that our efforts only touch the edge of the plight of these people. If we are to find some means of bringing hope, it will be in terms of the principles which are outlined through the conference on the sea.
I want to say a word about the common heritage principle, which surely must continue to be a mainstay in the negotiations as they proceed through the 1980s. It would seem that before this House could adopt fully the intention of this motion there will be need for further discussion, and this will surely come as the conference continues through 1980 on the makeup of the assembly, on the form of a secretariat which will be charged with the opportunity of carrying out the principles and the financial arrangements as they are developed.
More work will be done at the ninth session of the Law of the Sea Conference in the 1980s, and Canada will continue to play a significant and energetic part in that. Discussions through the 1980s will be on the development of the resources in the areas under discussion, on the composition and the voting of the council, and on surrounding financial arrangements.
This House is indebted to the hon. member for Cochrane for bringing to its attention this significant ongoing Conference on the Law of the Sea, and as the months pass and the new year comes this House will be receiving reports of developments, and surely will be in a position to ratify the negotiations which have been going on through this extensive process and period of time.


Hon. Alvin Hamilton (Qu'Appelle-Moose Mountain):: Mr. Speaker, 1 am sorry to change the tune that has been played in this House this last few minutes. 1 have heard a lot of complaints about the House of Commons at times for its lack
Law of the Sea
of credibility, but never have we aimed such a low blow as in the present debate.
This motion ignores the facts of life on how the world works. It does not begin to tell what this really is; this whole motion of turning the ownership of the bottom of the seas of the world over to an international authority. In reality what it is is a ramp by international mining companies to put the authority of ownership into the hands of an unsophisticated authority run by the United Nations civil servants so they can exploit the bottom of the sea like they have exploited the land surface of the earth. To pretend that we are doing all this in the name of doing good to people who are less fortunate than ourselves does not bring us too much credit in this House.
I wonder if I might go back and just remind you of a few things that have happened in this regard. Every one of us here is the son or the descendant of people who left the old world to come here to get access to land and resources. Some of our folks fought damned hard to get them. We have seen this fight of ours hurt, over and over again, as stronger powers took from us what we have fought so hard to win.
I saw the British, Spaniards, and French, in the history of our nation, come out to the western world. I saw the British win dominance here. One family of the British won more dominance than the other and fought with the United States. Our history is a history of fighting back the encroachments by Americans taking over our soil.
I come from that type of background, Mr. Speaker, and I think you do too. We understand what it means when we hear people stand up and say we should give away what our ancestors fought so hard to win, and hand it out for a purpose that is not what they pretend, but is nothing else in the final analysis but a ramp of the giant international mining companies to get control of something they want at the bottom of the sea.
When this proposal was first put forward I had the honour to make a proposal to the Law of the Sea Conference in 1958. The proposal Canada made at that time was that the land off our coasts at the bottom of the sea for a certain distance out would come under the national jurisdiction of the littoral state, the state beside the ocean. That was one of the two proposals made by Canada. There were five proposals made altogether.
I reported to the House on this matter in July, 1958. Canada's motion was supported by all the other nations present, and they unanimously agreed that the rule of law should prevail over the bottom of the sea. The decision was to divide up the bottom of the sea on the basis of extending our boundaries out into that sea to the point where they would meet the boundaries of the other nation coming from the other side. That convention was ratified after 22 nations had signed it, and that is the basis of international law today, that the ownership of the bottom of the sea belongs to the littoral state at the present time.
There have been a number of such conventions on the law of the sea based on the Maltese proposals of 1967, which were

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later modified into the stages of the Nepal proposal of recent years. It all comes down to the fact that these proposals were to change what the nations of the world had unanimously agreed to in 1958, that to bring the rule of law and order to the bottom of the sea and its unknown wealth of the future, we give control to the littoral states, the nations beside the oceans.
It was on the basis of that international law that the Conservative party, which now forms the government of this country, plans to give to the provinces of Prince Edward Island, Nova Scotia, Newfoundland, and New Brunswick, areas of this earth equal in extent to the size of Quebec, Ontario, Manitoba, Saskatchewan, Alberta or British Columbia. If we look at the history of our country, at one time Manitoba was a tiny little province, and there was not enough economic base to support the way Manitobans wanted to build. So the government of this nation extended the boundaries of Manitoba, and also the boundaries of the provinces of Quebec, Ontario, Alberta, Saskatchewan, and British Columbia. We were once small little areas unable to support ourselves on the resource base that we had.
My party would like to give the same feeling of equality that comes from having a resource base, to the eastern provinces. We cannot do this if we hand away what we have offshore. How can we give equality of size and resource base to Prince Edward Island, Nova Scotia, Newfoundland, and New Brunswick by giving away the land that is ours by international law, in the name of setting up a common heritage fund? I am not opposed to a common heritage fund. I think that every province should set up such a fund.
What I am saying is: look at the realities of what we are considering in this motion. This proposal came in with the Maltese proposal to the United Nations in 1967, I believe. Canadian civil servants jumped on it and began to write speeches for our MPs to deliver at the United Nations. I protested in writing about the proposal, but support for it still continued. It is embarrassing for me to hear the same thing coming from hon. members on our side who apparently do not know the story of how hard our party fought to bring justice to all parts of this country.
When it became known that there was an attempt to put up an authority under the United Nations to take over the resources at the bottom of the sea, all the big mining companies formed consortiums. They knew the expense of extracting minerals such as manganese and so on from the bottom of the sea would be so great that the mines on shore would have to cut back their production and that the world's consumers would pay a much higher price for this new supply. The whole world realized that situation. These companies moved quickly to take advantage of the situation, and from that one should realize that it was a ramp supported by the international mining companies to put two-thirds of the world, which is under the ocean, into the hands of unsophisticated people- call it an authority or what you will-so that these companies could get in and develop it under their type of regulations.
Canada has suffered terribly through its mining regulations in the provinces and in the federal territories. In 1957 I
[Mr. Hamilton (Qu'Appelle-Moose Mountain).)
proposed to this House that these regulations were unjust and that they were turning the wealth of our nation over to these companies. Those regulations were changed, and today when a company goes into our northern territories, it must agree according to the laws and regulations on the share it will take out. In the unsophisticated provinces, however, these companies merely have to pay a royalty and they can take all they want. That is the basis of the big fight between the federal government and the province of Alberta over oil.
I am simply pointing out to the House that we should be careful. God bless all hon. members; I know they have sympathies for these developing nations, but they are not helping them one bit. Canada takes second place to no nation in its efforts to help other nations of the world. But at the same time, no matter what we do, it is not enough. I am simply saying that such a move would confuse the issue. I know that there will not be a vote on this motion, but before hon. members bring up such a proposal again I suggest that they think of all its ramifications and what it will do to the policy and the hope of the Canadian government of bringing justice to the Atlantic provinces and, at the same time, ensuring that these resources off our shores are developed under rules and regulations made by Canadians, not by some international authority which has no knowledge on this subject.


Mr. John Gamble (York North):: Mr. Speaker, it is a pleasure for me to follow the hon. member for Qu'Appelle-Moose Mountain (Mr. Hamilton) and to deal with the motion before the House. I would draw to the attention of the House a couple of significant matters in this motion which give me substantial reason for concern.
1 am concerned in particular about the suggestion:
-that a significant portion of ocean mineral revenues, both offshore and in the deep ocean, should be regarded as "the common heritage of mankind" and used in a "Common Heritage Fund"-
My question with respect to that proposal is: who would administer it?
Another point of concern to me can be found in the concluding words of the motion. After detailing the nature of the fund and what it will be used for, these words appear:
-along the lines of the 1978 proposal of the government of Nepal.
I come to this House fresh from a non-political background. I am not familiar with the 1978 proposal of the government of Nepal and I would be reluctant to vote upon a matter of this nature without knowing exactly what it is that proposal in fact details.
From my observations in the House since being elected I feel that far too often we are confronted with complicated, difficult proposals for our consideration in determining the laws of Canada without all the facts before us, or without them duly explained. We are confronted with a proposal by an hon. member without an explanation or, indeed, any attempt to detail exactly what the proposals are.
Let me get back to my fundamental concern. It was raised by my colleague, the hon. member for Waterloo (Mr. McLean), when he said that the implementation of a program
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of this nature would assist in the preservation of peace. My comment is that if the peace process involves a constant handout, whether it be through Cl DA or through a program of this nature, then indeed peace is in a fragile position.


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


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.


John Carnell Crosbie: that Bill C-3, respecting grants to municipalities, provinces and other bodies exercising functions of local government that levy real property taxes, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
He said: Mr. Speaker, it is my pleasure and privilege to move that we proceed with second reading of this municipal grants act, Bill C-3. The bill is intended to expand and update the federal program of grants to municipalities in lieu of property taxes. The program began in 1950. It is now in its thirtieth year, which makes it one of the more durable of the intergovernmental programs in our federation. The Municipal Grants Act has not been amended since 1957, which is 22 years, by a quick calculation. It therefore contains anomalies and fails to take account of various changes within the provinces and property tax institutions, over these last 22 years. The bill is intended to remove anomalies in the law, to update the statute and expand the program, mainly by removing existing restrictions on grants. Most of these changes will take effect in the 1980 tax year of municipalities, but in some instances they will be pased in over a four-year period ending in 1983.
Tonight, Mr. Speaker, I am going to attend strictly to the tedious details of this bill without any attempt to enliven the debate. 1 think three is going to be a large measure of agreement in the House, and we are anxious to give a complete explanation of the bill at second reading. 1 am hoping for unanimous support-unanimity, before we finish.


Stanley Howard Knowles: We like the Minister of Finance (Mr. Crosbie) better when he is funny.
Municipal Grants


John Carnell Crosbie: Mr. Speaker, I welcome the comments of our new entrant to the Privy Council. Anybody who spends 37 years in this institution deserves to become a PC. He deserves that, Mr. Speaker.


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


Stanley Howard Knowles: Order!


John Carnell Crosbie: This is a very important program under which an estimated $148 million will be paid in this financial year in connection with the properties of various government departments. In addition, about $110 million will be paid by Crown corporations for their property. As well, the Department of External Affairs makes grants for diplomatic and consular properties, foreign governments and international organizations in Canada. This means that the total payments in respect of property taxes this year will be approximately $258 million from the Government of Canada, through Crown corporations and the Department of External Affairs. These grants are paid free of any condition.
I am sure many members of this House have had some experience in local government, as members of municipal councils or on school boards. I was a member of the St. John's city council in 1965 and became deputy mayor. 1 would be surprised if there were not possibly 50 or 100 members of this House who had some experience of that nature. Members will generally be aware of the vital role that municipal governments play in this country and the great value of the services they provide, very many of them without remuneration.
Local government services are primarily for the benefit of real property, to help enhance its value as well as benefit people who live or work in those real properties. The federal government owns real property in approximately 2,500 municipalities, or well over half of the municipalities in Canada have real property contained in their boundaries owned by the Government of Canada. We are the largest property owner and employer in the country. We are a major beneficiary of the services that are provided by municipal governments, particularly to real property. I want to acknowledge those services now and thank the municipalities, school boards, the elected councillors, police officers, fire fighters, engineers, teachers, garbage collectors, maintenance workers and the others who provide the services that assist our property, as well as that of the other citizens of this country.
All of these services have to be financed. As hon. members know, the main instrument of municipal finance is the local property tax. Owners of private property have to pay this tax and naturally local councils feel that the Government of Canada should pay its way too for the services we receive. There are now various categories of federal property which receive local services but they are excluded from the grant program, that is, they are excluded until the House passes this legislation, if the House chooses to do so. The principal aim of

December 3, 1979
Municipal Grants
this bill is to remove and reduce these exclusions so that this program will cover as many federal properties as possible.
1 should point that section 125 of the British North America Act states the following:
No Lands or Property belonging to Canada or any Province shall be liable to Taxation.
This provision explains why we make payments in the form of grants rather than taxes because, under the British North America Act, we are not exposed to local taxation. It also explains why the established system of appeals through the courts for settling differences between municipalities and private taxpayers is not used in our grants program.
The present system for settling any differences between the Government of Canada and a municipality will continue. Under that system differences are discussed between ourselves and the municipalities. The municipality is given every opportunity to state its case and then we have to make a decision whether it is a case that we should accept. This system has worked well so far. It avoids great legal costs; extra staffing and delays that would be involved with any appeal system involving the federal government. This bill makes it clear that where a grant is to be made its amount is intended to be equal to the amount of tax that would be paid if the property of the Government of Canada were taxable property to the municipalities. If we cannot reach agreement, however, the Government of Canada eventually has to decide the matter itself. Afer all, under the British North America Act we are not subject to any local taxation at all. We are making grants in lieu of taxes and we have to make the final decision.
I am advised-I am no expert in the area-by my department that cases where the Government of Canada and the municipality have been unable to reach agreement in the past have been quite infrequent, that is, in disputes about valuation and the like. We believe that in the future unresolved differences should occur less often because this bill contains changes that meet many of the complaints that municipalities have been making up to this date.
The equality between grants and taxes is achieved by two steps. First, our property is to be valued as if it were taxable property. Second, the rate of tax used in calculating the grants is to be the rate of tax that would be applicable to property of the federal government if it were taxable property. The principle of equality between grants and taxes is generally followed in this program.
There are two exceptions which have been a source of irritation to local municipal governments and provinces, and it is intended in this bill to remove those two exceptions. The first exception is deductions for local services which the federal property does not receive or does not use. The second refers to the use of preferred tax rates for calculating grants on certain kinds of federal property. At the present time deductions are made from grants in respect of local services that are not accepted by the Government of Canada. The deductions for those kinds of services consist of elementary and secondary schooling, police protection, fire protection, garbage collection

and sewage disposal. The exceptions relate almost entirely to national defence property.
Complaints have been received about these deductions because they cannot be claimed by owners of private property. In addition, deductions create problems in cases where one local authority collects taxes on behalf of another. In these circumstances provincial legislation may specify how grants in lieu of taxes are to be allocated between the different bodies. In this event the existence of service deductions complicates that allocation and is a great source of irritation to the province and municipality concerned. It is our intention to eliminate almost all deductions from our grants. However, deductions for schooling are a special case because of the tremendous financial magnitudes involved. These deductions will continue where the Government of Canada operates its own schools or where it has worked out some alternative means of financing school services with a province or local school board. If the deductions are not made in those circumstances we would be making two sets of expenditures for the same purposes, and that would not be reasonable.
In future, deductions may arise in respect of services other than education only in very special circumstances. But in no case will we make deductions from real property tax grants for any service that a municipality is willing and able to provide. This means that deductions related to police protection, fire protection, garbage collection, and sewage disposal should be eliminated. I hope that the municipalities that benefit from the removal of a service deduction will be prepared to provide the same level of service for our property as they are for taxable property if they are not now doing so.
Second, I indicated that the Government of Canada presently uses preferred rates of tax in calculating grants on some properties. These preferred rates arise because most local governments are required by their provinces to levy real property taxes at two or more rates. These rates usually consist of a low or a preferred rate for residential and farm property, and a high or non-preferred rate for commercial and industrial property. While the Government of Canada now uses the nonpreferred higher rates in calculating grants on most of its properties, it uses the preferred lower rate for certain categories. These include employee housing, experimental farms, hospitals, educational properties, and penitentiaries. This is a bit complicated and tedious, but I hope members in the House will permit me to put all of this on the record.
The use of a preferred rate has worked well in the case of employee housing. It has not always worked well in other cases because it has not always been clear that these other federal properties could be properly compared with taxable properties that qualify for the low rate. In future, we propose to take advantage of preferred rates only where property of the Government of Canada is directly comparable with the taxable property to which the low rates apply. This is another improvement for the assistance of the municipality.
As a result of these changes, Mr. Speaker, in respect of service reductions and preferred tax rates, it should be evident that in almost all cases where grants are paid under the new
December 3, 1979

municipal grants act we are now considering, these grants should constitute the full equivalent of the taxes that would be paid if the property of the Government of Canada were taxable property.
This is really legislation that has been sponsored by the government House leader. I have to say that the pressure has been intense from the government House leader for this legislation to be brought forward. He is, of course, the great champion of the Ottawa area and a man who has waged a constant campaign of harassment against me to bring it on. Any generous provisions in this bill are due entirely to him and other members on this side who represent municipal areas that are involved.


Mr. Whelan:: It was Jean Chretien who announced that first.


John Carnell Crosbie: Why did he not carry it through?


Eugene Whelan: Certain things happened to him.


John Carnell Crosbie: Why did he desert it along the way? This brings me to what is undoubtedly the most important part of this bill.
1 am delighted to have an interjection from one of our leadership candidates on the other side. Many on this side are hoping the hon. gentleman will truly lead his party, that we will not have the Bay Street boys taking over but instead will have the farmers truly represented for the first time in the leadership of the Liberal Party of Canada.


Walter David Baker: Whelan will whale them.


John Carnell Crosbie: Many of us here are almost prepared to walk across the floor to help that hon. gentleman.


Eugene Whelan: 1 know you are in need of leadership. That's for sure. After you saw that Gallup poll you have to go somewhere.


John Carnell Crosbie: Notice I said "almost". This brings me to what is the most important part of this bill, that is, the definition of property that will be subject to grant. If hon. gentlemen referred to the bill, and I know they have all read the provisions intently, and if they looked at subsection 2(2), while that subclause is rather complex, the basic intention is simple. The basic intentions of the hon. gentleman I have just been talking to are simple, but to achieve his ambitions will be complex.
The provision of that subclause is that grants shall be paid in respect of all real property owned by the Crown that is occupied by a federal department, subject to exception for structures, urban parklands and Indian reserves. This new definition of the property that is subject to federal grants is much broader than the one that is now in effect. The properties that will be eligible for the new and enlarged grants will include defence bases in rural or semi-rural areas. The hon. gentleman who represents a rural area is apparently unconcerned about this.
Municipal Grants


Eugene Whelan: I am talking to another member from a rural area.


John Carnell Crosbie: It will include defence bases in rural or semi-rural areas. I do not even hear the hon. member knocking on his desk applauding. He is certainly not looking for support as far as I can see. It must be a false rumour.


Eugene Whelan: If there is anything false, it is on the other side.


John Carnell Crosbie: These are presently classified as self-contained defence establishments. Other properties that are going to be eligible are national parks, wildlife reserves, which, of course, are more suitable for some of those gentlemen-


Some hon. Members:: Oh, oh!


John Carnell Crosbie: -national parks, historic sites, and that accounts for the first bench over there, these historic sites will be subject to grants. Parliament Hill will become subject to grants. Museums-we are back to the front bench of the opposition again.


Jean-Luc Pepin: Are circuses included?


John Carnell Crosbie: Libraries, art galleries, concert halls, water conservation projects and community pastures-we are back to the hon. gentleman again.


Eugene Whelan: That is where you are going to go, so you want to fix them up good.


John Carnell Crosbie: The hon. gentleman will be put out to pasture.


Eugene Whelan: The Gallup poll said who will be put out to pasture.


John Carnell Crosbie: The only gallop we are worried about is the gallop to the polls.


Eugene Whelan: You ought to be!


John Carnell Crosbie: We are including now self-contained defence establishments, national parks, historic sites. Parliament Hill, museums-strange conjunction-libraries, art galleries, concert halls, water conservation projects, and community pastures. In addition, three other rather specialized categories will be newly eligible. First, portions of Indian reserves that are occupied by federal departments to provide services to persons who are not resident in such reserves and, second, real property occupied by a department under a long-term lease known as an emphyteutic lease-do you know how to pronounce that?


Walter David Baker: You did very well.


John Carnell Crosbie: -third, real property owned by a province but occupied and used by a federal department pending transfer of administration and control. In the case of some 58 defence bases presently classified as self-contained, grants are now determined with reference to the value of the land plus any buildings used as married quarters. We do not now make any

December 3, 1979
Municipal Grants
payments for administrative or operational buildings. This is incredibly complicated.


Jean-Luc Pepin: Then table it.


John Carnell Crosbie: Imagine, for 22 years payments have been made on self-contained defence establishments for the land plus buildings used as married quarters, but they were not used as married quarters, they were administrative operation, and no grants were paid. This bill removes that restriction.
The result of this enlarged definition, if hon. gentlemen and ladies of the House pass this bill, will be to increase payments in all parts of Canada. Along with the other changes that are set out in the legislation, this will benefit many municipalities. It will increase the grants paid on the property of government departments by an estimated $25 million as of 1983. In addition, there will be other benefits that relate to Crown corporations. I will come to that a bit later.
Some of these changes will be phased in over four years. The phase-in provision is set out in clause 15 of the bill. This clause is limited to increases in grants on self-contained defence bases, national parks, museums, art galleries and concert halls. All other changes will be fully effective with the 1980 taxation year.
The definition of property subject to grant has some remaining exceptions. There are only three of significance-structures, urban parklands, and Indian reserves. Members might ask, what do you mean by structures? I was struck by that question myself when I examined this. Structures are the most important. These include jetties, canal locks, and aircraft runways. These are some of the examples. The cost of those kinds of structures and the potential grant are very large.
At the same time, because of the nature of these items, the local cost of providing services is minimal. In all justice, can we say that municipalities provide services to jetties, canal locks, or aircraft runways? Of course they don't. If grants were paid, they would in most cases greatly exceed any costs to local government for providing services to those kinds of structures, so they are not included.
In addition, whereas all jurisdictions apply their property taxes to land and buildings, there is a great deal of difference with respect to structures. Many types of structures are taxed only in some parts of Canada and not in others. In addition, many structures are by nature owned only by governments. Therefore, we have no comparison to the private sector. The decision to exclude structures from this bill was taken in view of those kinds of considerations. Schedule II of the bill sets out a list of structures of which I have given some examples. That list is not exhaustive but it shows the kinds of properties that are included.
Second, urban parklands were excluded on the grounds that that property, urban parkland, provides a service that normally is provided by an urban municipality. In other words, if the Government of Canada has urban parkland, that is ordinarily the kind of service that the municipality should provide. Where it is provided by a municipality, the municipality does
not get any direct revenue from the urban parkland because it cannot tax itself. If we are providing the same kind of service, why should we pay a grant on this kind of property where we are providing the service to the municipality? That is the reason for this second exemption.
Indian reserves are a special case. I must say I have no direct experience in this because we have no Indian reserves in my home province of Newfoundland. In some parts of Canada, municipal boundaries are drawn in such a way as to exclude reserves. In other parts of Canada, Indian reserves are within municipal boundaries. However, the payment of grants to the municipalities concerned would imply some degree of integration between the reserve and the municipality in the provision of services which seldom exists.
There are some very special cases in defining federal property. I will just refer to one category because of its importance. That is Crown property administered by a federal department but leased to or occupied by a third party. In most cases, the third party is taxable by the municipality with respect to its occupancy of the property. The amount of the tax payable is exactly the same as it would be if he were the owner of the property. In most of those cases, the occupant pays the tax for which he is liable and there is no problem. However, if for any reason the occupant does not pay his tax, the municipality then has a problem as to how it enforces the collection of their tax. Normally they can seize a property and sell it, but they cannot seize Crown land and sell it. The existing act tries to deal with that problem by excluding leased property from grant if the occupant is taxable, but permitting the minister to include the property by prescription.
There have been many controversies over the years as to whether this particular property or that should be prescribed. Well, this problem has been examined at length by the government as well as by its predecessor. The most basic conclusions which emerged were the following: first, in general the government ought not to pay grants with respect to property which it does not occupy. In particular, we should continue our policy of not paying grants on behalf of applicants who are themselves tax exempt. This occurs where a departmental property is occupied by a province, municipality or school board. 1 mean, if our property is occupied by a province, municipality or school board, and they are tax exempt, surely there is no reason we should pay the tax although the organization concerned does not. If a municipality is unable to derive revenues from a body where it owns property, thee is no strong reason why it should derive taxes from the federal government when that body occupies federal property.
Second, where the lessee or occupant of departmental property is taxable in respect of his occupancy the government ought not, in most cases, to include the property in its grants. The occupant should continue to pay the taxes for which he is liable. This works well in most cases, but there would be great difficulties if we were to attempt to pay on behalf of the

December 3, 1979

occupant, particularly where occupancy is for commercial or industrial use.
There are some instances where the occupant of departmental property is taxable and where the system does not work well if the municipality seeks to tax him. This occurs most often in the case of residential and farm property. If there are a large number of problems of this kind in a particular municipality it might face the possibility of a significant revenue loss because of the difficulty of enforcing collection of its taxes. There are other instances when the federal government expropriates or purchases property with outstanding leases, including commercial or industrial leases, and when payment of tax by the lessee would mean he is paying twice- once directly and a second time indirectly through his rent. The government should continue its present policy of including these categories of leased property in its grants and should, in almost all cases, take the necessary steps to recover its costs through rental charges. The municipality then forgoes its right to tax the occupant.
The problem of leased property calls for maximum flexibility, and the act should give the minister power through regulations to determine how property which is leased or occupied by a third party should be treated in an effort to meet special cases. Then, of course, we shall have to keep the case of leased properties under periodic review.
Well, Mr. Speaker, those conclusions are reflected in the bill before us. In particular, clause 8(1 )(e) gives the governor in council authority to make regulations prescribing particular categories of leased or occupied property as being eligible for grant. We intend to have the necessary regulations prepared to enable us to pay grants on those categories of lease or occupancy which are included in grants under the existing act. This bill will require that the regulation be published in the Canada Gazette. I might say that that has not been the case in the legislation up to now.
I would point out that clause 8(3) requires that all regulations proposed by the governor in council under 8(1) are to be published in the Canada Gazette and shall not become effective until a reasonable opportunity is given to interested parties to make representations about them to the minister. That is another new departure.
I would also call the attention of hon. members to clause 10. This authorizes the minister to enter into bilateral agreements with the provinces respecting leased property. We do not intend at the present time to seek such agreements. However, this provision might be useful in the future if it were ever considered desirable to pay grants on a broader range of leased properties.
Most of my comments up to now have related to grants in lieu of real property tax. As we all know, this is the tax which municipalities levy each year upon owners of real property, based upon the value of the property occupied and the tax rate applied to that value. There are other taxes levied upon owners' real property and these, too, will be covered by the bill. Such taxes are based upon some characteristic of property other than its value. Usually such taxes are tied to the frontage
Municipal Grants
or area of land concerned, or to a building on the land. Local improvements are the best known example. The bill defines these other taxes as frontage or area taxes and provides for payments in respect of them.
Grants in respect of most of these have been paid in recent years, but apart from local improvements this has been done pursuant to special wording added to the municipal grants vote of Parliament and not through the act itself. However, it has not been possible in the past to pay grants where such taxes were levied to finance non-capital services such as street oiling. The present bill removes that restriction. Now street oiling is not of much importance in areas where all the streets are paved, but for people living in areas such as certain places in Newfoundland where street oiling is important, this can be important. I am sure the hon. member for Grand Falls-White Bay-Labrador (Mr. Rompkey) would agree.


Mr. Rompkey:: We don't even have streets.


John Carnell Crosbie: He says some of his communities don't even have streets. As 1 say, the bill removes that restriction and it gives the minister an option for the first time of paying a local improvement grant in a lump sum exclusive of interest, or in annual instalments of blended interest and principal. I hope hon. members are grasping the minutiae I am trying to detail here, Mr. Speaker, because the municipal councils will be interested in all this.


Eugene Whelan: It was more interesting when the hon. member for Stormont-Dundas (Mr. Lumley) presented it to cabinet committee a few months ago.


An hon. Member:: What?


John Carnell Crosbie: It is shocking to be interrupted by an old veteran of the House like that.
The bill also removes a long-standing restriction in respect of water taxes. Most municipalities finance water as a service charge but there are some, mainly in the province of Quebec, which finance it in part by a property tax.
The bill does not provide for the payment of grants in lieu of business occupancy taxes on departmental property. I know this is an issue with many municipalities; they claim we should pay grants in lieu of business occupancy taxes, but we just cannot see that proposition. The payment of business tax grants has been considered-there is some validity to the argument. However, we take the position that government departments are not engaged in business. That, surely, is evident from the record of the last 16 years. In fact, the government was not engaged in business either. It was engaged in harassing business.
There are some parts of the government which are engaged in business but they are a relatively small number of Crown corporations, the Crown corporations which are trying to make a profit or a reasonable return on investment capital. So the argument used by the municipalities would apply to them, and does make some sense. The bill does address this matter and it identifies the bodies which will be expected to make payments

December 3, 1979
Municipal Grants
in respect of business occupancy tax. We feel that certain Crown corporations which are comparable to business in the private sector should pay business tax grants, but not the ordinary departments-they are not engaged in business, they are engaged in providing a service to the public. It is to be hoped they are.
Another argument against paying business occupancy tax grants on departmental property is that the money which would be required is simply not available. If we were back in those halcyon years when revenues were burgeoning, when hon. gentlemen opposite were spending like mad, when they were looking around to see where next they could throw some public money, if we were in a situation of that kind and we did not know what to do with it all or where to spend it all, we could spire some out in business occupancy tax credits. That is not the case today. We have had that for the last ten or 15 years. The cupboard is getting pretty bare, and we simply have not got the money that would be needed if we agreed to pay business occupancy grants in lieu of taxes.
We also feel that it would be preferable to bring into the grants system some properties now totally excluded rather than leave those out while increasing the grants on properties that are already qualifying. 1 want to point out, by the way, that none of the provinces now pay a grant in lieu of business occupancy taxes in respect of the departmental property of those provinces, so it ill behooves them to look at us and say that we should do the same. There is one province, la belle Province de Quebec, that has recently introduced legislation which is going to result in that step being taken in the province of Quebec. I am not sure whether that legislation is now passed, but there is a considerable change taking place in Quebec with respect to real property municipal taxation, and the province of Quebec intends to do this, but it is the only province.
So, 1 come now to the subject of grants by Crown corporations and agencies. They are excluded from direct coverage under this particular municipal grants act, but it has been government policy since 1950 that they should pay their own grants. And, since 1967, they have been directed to pay on a basis at least as generous as that set out in the Municipal Grants Act for departmental property. So, it has been a matter of policy that they pay grants in lieu of taxes.
In general that system has worked well. However, there have been cases where it has not, and there have been no effective means of co-ordinating the practices of the bodies concerned. There has been confusion on the part of municipalities and provinces as to our general policy, and in some few instances there have been bitter complaints. So, to try to remedy this situation the bill contains three provisions. First, it provides for the governor in council to make regulations which will constitute guidelines to be followed by Crown corporations making grants in lieu of taxes.

Second, it specifies that such guidelines are to provide that grants be determined on a basis that is at least equivalent to that which is applicable to departmental property.
Third, it lists schedules 111 and IV, if hon. members will check those schedules, the specific bodies which are affected by these guidelines. The bodies listed in schedules III and IV are required to pay grants in respect of real property taxes and frontage or area taxes. The bodies listed in schedule IV, in addition, are required to make payments in respect of business occupancy taxes as well. Bodies are listed in schedule IV if they are generally independent of our own treasury, the federal treasury.
I think it might help members of the House who are interested if I just outlined what the government's guidelines will be if the House passes this bill. The first principle will be this: Crown corporations are not to enter into special arrangements with local governments or provinces in respect of real property taxes, frontage or area taxes or business occupancy taxes.
Second, the grants that they make are to be paid to taxing authorities responsible for collecting taxes in the areas where their property is situated, and they are not to by-pass these authorities.
Third, the grants are to be paid in respect of any property of a kind that would be subject to grant if it were property of a federal department. However, this will not apply in respect of Crown corporation property leased to a third party.
Fourth, the rate of tax to be used in calculating a grant on Crown corporation property is to be the rate that would be applicable to such property if it were taxable property. Deductions from the resulting grants are not to be made except in very limited cases where they could be made in respect of departmental property as set out in clauses 6 and 7 of the bill.
The fifth principle is this: Grants are to be settled and paid with reasonable promptness in respect of each taxation year for each taxing authority, having regard to when the taxes are due for the owners of private property. Where final settlements cannot be made within such a time frame, interim payments are to be made which will be substantial in relation to the total grant that the body estimates will be made for the taxation year.
Sixth, grants are to be paid free of any conditions.
Seventh, where a dispute arises between two Crown corporations as to which of them is responsible for the payment of a grant in lieu of taxes for a given property, the matter will be referred promptly to the Department of Justice for a ruling, and the opinion of that body shall be accepted.
These are the principles that will be contained in these regulations if the bill is passed.
These guidelines should help to clarify the present situation with reference to grants by Crown corporations and agencies. They will be set out with precise wording in regulations, but they will not become binding until the bodies concerned or any other intereted parties, including municipalities, have had an
December 3, 1979

opportunity to comment on them. For this reason we do not intend to have these guidelines become applicable until the first day of taxation years commencing on or after January 1, 1981, not 1980.
Provision will be made for adding corporations to or deleting them from schedules 111 and IV. This will be done at a later stage, likely in connection with a separate bill. Bill C-27, dealing with the Crown Corporations Act. I believe that has now had first reading in the House. Bill C-27 concerns the control, direction, and accountability of all Crown corporations.
I should also refer before closing to the role of the provinces in this federal program. Municipal governments are the creations of the provinces. I notice that my script says "the creatures of the provinces". I remember when 1 was elected to St. John's city council that this term was used by somebody in the Newfoundland government. We were the "creature" of the provincial government. 1 took strong objection. So, harking back to that, over the years, back, in 1965-14 years ago; it is gone in a flash. As you get older, you realize we are only transient here.


Jean-Luc Pepin: Some more than others.


John Carnell Crosbie: The poll has had very deleterious effects on me.
However, local governments are creations of the provinces. The taxes which they can levy, as well as the form of those taxes and the body that is responsible to administer and collect them, are all determined by the provincs. With a few exceptions, notably those that apply to appeal procedures and the definition of property subject to grant, we try to follow the property tax institutions of each province.
For that reason grants have always been paid to those bodies which had been designated by the provinces as tax collecting bodies. As a consequence we pay grants to school boards. We pay them to upper tier and regional municipalities only where they are the tax collecting authorities as designated and appointed and decided by the provinces. In my view it would be inappropriate for us to depart from that practice, or for us to designate on our own the bodies to which our grants should be paid. That is a matter to be decided by the provinces which create the municipal and local government structures in this country.
I have to point out in that respect that in some cases the provinces themselves, or the territories, collect the property taxes. This is happening in New Brunswick, Prince Edward Island, British Columbia, the Yukon, and the Northwest Territories. In those cases we pay federal grants to the provinces and the territories in the same way as we do to the municipal governments since 1967. That has been authorized by a special wording added to the municipal grants vote of Parliament and not through the act itself. If we pass this bill, then such payments will be brought within the act for the First time.
Finally, in ending I want to note a number of minor new things which the act does. It permits the payment of grants for
Municipal Grants
the first time to Indian band councils where they levy a property tax. It provides exclusions for lands for which a Crown grant was never issued and for which there is no designated use, and also for general purpose public highways owned by the federal government. It gives the minister power to reduce a grant by the amount of any cancellation, reduction or refund of taxes that would be applicable to federal property if it were taxable property. There is no concern why we should not get the same kind of reduction.
While the bill authorizes grants on community pastures for the first time, it has an exclusion in clause 11 for such time as a special existing program of payments in lieu of taxes on community pastures continues in effect.
The fifth point is that the bill makes it clear that no grant is to be paid in respect of taxable property acquired by the Government of Canada for any part of the taxation year during which it is acquired. The latter is because in fact the former owner of such property is taxable for the whole of the taxation year during which the acquisition takes place, and there is no reason why the tax should be paid twice.
This brings me to the end of my comments about the purpose and intent of Bill C-3. We can all see from my remarks-and I know they are hard to follow if one does not have the text before him-that this is a complex and important measure. It will tidy up and modernize a statute where changes are long overdue; it is now 22 years since it was changed. It will bring substantial benefits to local governments in all parts of Canada and will strengthen the principle that the Government of Canada is paying its way for the services it receives from municipal government.
Before anyone in the official opposition jumps up to point it out, I am quite happy to say that the terms of the bill are pretty well the same as the bill which was introduced in the House of Commons approximately nine or ten months ago by the then minister of finance, who has since passed on to happier things in the opposition. Therefore I would anticipate tremendous support from the official opposition for this piece of legislation. 1 would not be surprised if even the New Democratic Party supports this legislation. Normally they do not like to see money spent or any increased amounts of money spent when it comes to the average home owner across Canada who hopes to get a break in the new year through another piece of legislation that I would not mention because I do not want to get on a controversial tack here. But I hope even members of the New Democratic Party will support this legislation and we get it through the House tonight. As a matter of fact, we have one hour and ten minutes. What a tremendous demonstration this would be to the municipalities of Canada of how members opposite were concerned about them, if this whistled through all stages tonight with no hesitation, on to third reading, and became law tomorrow. I move second reading of the bill.


Some hon. Members:: Hear, hear!

December 3, 1979
Municipal Grants
[ Translation]


Jean-Luc Pepin: Mr. Speaker, the first time I had the opportunity to speak in this most impressive chamber was in 1963. I had chosen, as the topic of my maiden speech, the price of manufacturing milk. In so doing, I was of course proving the great interest I had in local matters dear to my electors of Drummond-Arthabaska, my riding at the time, and today the riding of Drummond. I must admit that I am seeking to express somewhat the same feeling today in speaking of grants in lieu of taxes paid to municipalities in which there are federal buildings, a topic of prime interest, naturally, to the electors of Ottawa-Carleton, my new riding.
Mr. Speaker, I do not profess to be an expert in the matter like my colleague from Langelier, former mayor of Quebec City, who unfortunately is unable to be here tonight and who would very much like to participate in the debate. This may be reason enough to extend it till tomorrow because the hon. member for Langelier (Mr. Lamontagne) has important things to say about the principles involved in this debate. As for me, 1 certainly intend to become more versed in the matter than I was, or at least sufficiently to meet the needs of my present duties.

The Minister of Finance (Mr. Crosbie) has already given the basic elements of this bill. They are pretty clear, notwithstanding the fancy job he did on his speech, with additions which were more of a confusing nature than of an enlightening one. But we thank him for that nevertheless, because it made the last hour easier to go through. The words, thoughts and ideas, as he said himself, are those found in the proposal made by the hon. member for Saint-Maurice (Mr. Chretien) in Bill C-46 in January of 1979. So, we can easily call it a bipartisan, and, I hope, a tripartisan bill.


Walter David Baker: Quadripartisan.


Jean-Luc Pepin: As has been clearly indicated, obviously 1 have a special interest, as others have, because of what is involved in this bill for Ottawa and surrounding municipalities. I am informed on what the city of Ottawa will be getting out of this new law. Presently the grants in lieu of taxes for the city of Ottawa are in the area of $30 million. This figure will go up by $3.3 million in 1980, by $4.4 million in 1981, by $5.5 million in 1982, and $6.6 million in 1983.
The township of Gloucester is interested in it too. At the moment it receives $1,165 million, and $475,000 for the Crown corporations. I assume that that figure will be adjusted as the others will be.
1 am very keen to know what the village of Rockcliffe will be getting out of the new formula by way of compensation for embassies located on its territory. As the minister said, in the case of Ottawa, the Parliament Buildings, the National Archives, the National Library, the National Arts Centre and the National Museum will be included for the first time in the formula. As he said, also the bill covers Crown corporations, at least those found in schedules I, III and IV. This includes only

56 of them. I am quite keen to know what will happen to the others. Presumably we will have detailed statistics on what will happen to the Crown corporations not listed at the end of this bill.
[ Translation]
The following question is immediately raised: does Bill C-3 solve all problems and satisfy the aspirations of the municipalities involved? The views of the municipalities have been stated by the Canadian Federation of Municipalities in a letter to Mr. Chretien and a brief to the Canadian government, both delivered on June 20, 1977. It would be useful to make a comparison between supply and demand, between the demands of the municipalities and what is offered by the government, to record in Hansard and comment very quickly a few excerpts from the second document. It is a paper which I read carefully and, as I said, I would simply wish to put on record in Hansard a few quotations so that those who read the interesting debates of this House can compare the demands of the municipalities with what they get under Bill C-3.
1 therefore quote from the brief dated June 20, 1977 and entitled "Urgent Amendments to be made to the Municipal Grants Act". The quotation reads as follows:
Through the federal program of grants in lieu of taxes, considerable revenues accrued to the municipalities of Canada. However, the program had several basic flaws. In our opinion, the federal government should pay taxes the same way as any other ratepayer of a municipality or provide corresponding grants.
That is the principle the former mayor of Quebec City, now the hon. member for Langelier would like to comment upon tomorrow. In that paper, the municipalities indicated five issues still outstanding in June, 1977, at the time they were expressing their opinions. The first issue was the difference between the assessed value and the agreed value. I quote from the brief:
In a number of cases, the assessed value of a given property (determined by the municipality) does not coincide with the agreed value (determined by the federal government). We strongly recommend-
It is still the Federation of Municipalities that is speaking.
-to correct the situation by accepting the assessed value that the municipality concerned will have determined.
Bill C-3, as the Minister of Finance indicated very clearly tonight, does not recognize that principle. Clause 2 of the bill defines theeffective rate
-as that which "in the opinion of the minister, would be applicable to any federal property if that property were taxable property". The minister said that this difference between the assessed value and the agreed value does not create too many problems. My information is slightly different.
As a matter of fact, I have been told that in 10 per cent of the cases the agreed value is higher than the assessed value, that it is lower in 50 per cent and that it is the same in 40 per cent of the cases, which still means that there is a difference between both values in 50 per cent of the cases. The govern-
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merit's refusal to accept the point of view of the federation is probably based on the lack of consistency in the assessment process from one town to another. But we should like to know, and we shall see in committee, whether the problem is serious and whether there is a way of reducing-we should always try to improve the law-the total liberty now left to federal authorities which are responsible for the negotiation of the evaluation base. Perhaps the mechanism itself through which the evaluation is determined should be improved.
We should also wonder, and the minister did so, how the provinces act in such circumstances. 1 read that some provinces accept the municipal evaluation. So we should try to determine why they do so. If some accept the municipal evaluation, there is perhaps some reason for this. I also read while preparing my speech that some commentators suggested there should be some common effort between the federal government and the provinces to have precisely a common federal-provincial approach in that area. This is perhaps a subject to be put on the agenda of a federal-provincial conference.
The second area of conflict which the Federation of Municipalities mentioned is the number of tax exempt properties at the present time. There is no possible ground for discussion on this subject. There has been a great deal of improvement in the number of federal buildings which are now, which henceforth will come under this system of grants in lieu of taxes. But are they cases of unacceptable tax exemptions? The Ottawa municipal authorities seem satisfied but other municipalities may not be so and they should be encouraged to write to us if that is the case.
The third issue of conflict is the business occupancy tax and again 1 quote the text from the Canadian Federation of Municipalities.
The federal government has not taken into account the business occupancy tax in the calculation of the grants. The Canadian Federation of Municipalities suggests that the business occupancy tax is an integral part of the property tax system.
The commission paper then lists the reasons which in the past had justified or seemed to justify the refusal on the part of the central government to compensate for the non payment of the business tax. These two reasons are, first "the lack of uniformity in Canada concerning this tax system", and second the fact that "federal government activities do not generate taxable income".
And on that point the federation was almost violent, not accepting, and again I quote:
-the technical arguments used by the government-
-which, they said-
-to a large extent do not apply to the calculation of the grant and do not hold before the significance of that tax as a source of revenue for municipalities.
1 have a bit of difficulty here because the text of the Federation of Municipalities uses the expression commercial
Municipal Grants
tax. It may just be a matter of semantics but I have been told that for the past three years the commercial property tax has been accepted with the residual property tax as the basis of evaluation in the current legislation on grants to municipalities. In other words, and the minister said so earlier, any property tax, residual or commercial, is considered to determine the basis for federal grants.
What is not accepted-the Minister of Finance has also mentioned this, maintaining the central government's position in this regard-what is not accepted is the business tax, the business occupancy tax which is defined in clause 8(2) of Bill C-3 as a tax for business activities and not as a property tax as such. This business tax is still excluded in the bill, except, as the minister indicated, for Crown corporations listed in schedule IV, corporations which are openly and truly commercial.
So, Mr. Speaker, this is one of the most important points on which the Federation of Municipalities, speaking on behalf of municipalities which are recipients of these grants, disagree with the government. Incidentally, it is important to note that if the business tax or the business occupancy tax were retained as a basis for federal grants it would add, I do not have any precise figures since estimates vary, but it would add $30 million, $40 million, some even say $100 million to the amount the municipalities now claim from Ottawa. I wanted to stress this point, Mr. Speaker, so that it would be well understood, including by myself, that there is a very large gap on this point between the Federation of Municipalities and the central government.
The fourth contentious issue is that of deduction for services. The minister stated tonight that almost all deductions were now set aside. As he himself said, this includes schools, police, and garbage collection where the government uses its own services or does not use those of the municipality. Those deductions are covered in clauses 6 and 7 of the bill. I have consulted those concerned and was told that this did not represent a major problem here in Ottawa. Again, if our information is not correct I hope that the people concerned will write to us or will phone us. There may be instances where this creates real problems.
Finally, the fifth contentious issue that the federation brought up in June, 1977, concerns Crown corporations; it deplored the fact that there was no "consistency in the way Crown corporations pay their municipal taxes". According to what the minister said tonight, and to the bill before us. Crown corporations listed in schedules 1, III and IV are now subject to this legislation. Therefore, in this instance, as in two or three others, the federation won its case. But there are other Crown corporations, not enumerated in schedules I, III and IV, and about which we would like more information.
Mr. Speaker, 1 would like to conclude the second part of my comments by saying that Bill C-3 solves a lot of problems but does not solve them all. The most pressing problem that

December 3, 1979
Municipal Grants
remains is that of the status of the business tax, the business occupancy tax, the formula for evaluating the effective rate which is the basis of the grant. The minister has said again tonight that the federal government will act as it has in the past.
[English ]
The federal government in these matters continues not to recognize business occupancy taxes in its new granting formula with some exceptions; for commercial Crown corporations. Why is that? One reason is that municipal business occupancy taxes vary from one province to another, ranging from Prince Edward Island, which not long ago abolished them completely, to Saskatchewan, Ontario, and Nova Scotia, which 1 understand have made them mandatory. I understand Manitoba permits municipalities, but does not require them to levy an extra business tax. In addition, as a general rule throughout Canada, distilleries and breweries pay much higher rates of taxes. Pipelines, telephone companies and mines usually have their business tax rates prescribed by statute.
To repeat, there is very little consistency in business taxes from one municipality to another or from one industry to another, and that is the real problem. The Canadian Federation of Mayors and Municipalities have spoken, as I have said before, for the inclusion of these business taxes in the grants formula, for many years. Should they be accepted, they would add about 25 per cent to the cost on a national basis. Municipalities have argued that by making grants purely at residential and commercial real property rates, the federal government is paying less than its fair share. This is an argument of which the public at large and members of Parliament must be very much aware.
Prince Edward Island has found an interesting way around this difficulty. It abolished business taxes and created a single rate for all property, the effect of which was to increase federal grants in lieu of taxes in that province. Theoretically, all provinces could follow the example of Prince Edward Island and create one uniform tax rate which would be higher than the current residential and commercial rates combined. In practice, however, it would be very difficult for them to do so, as they would be accused of giving money to businesses, especially breweries and distilleries. So, politically, they have not been able to do this, in spite of the fact that such a move would increase grants in lieu of taxes.
1 would like to emphasize that there is created here an anomaly which in principle should be corrected if at all possible. The problem has potential constitutional dimensions. 1 would put the questions to the Minister of Finance in this way: the first possibility is, should the federal government respect provincial autonomy and jurisdiction in municipal affairs and accept the distinction most provinces make between commercial and business occupancy tax and let them penalize themselves or their municipalities if they so wish? The second question is, should Ottawa respect provincial autonomy and jurisdiction and accept the province's right to distinguish
commercial and business occupancy taxes and not penalize those provinces which do so? In my view these are the alternatives. I am quite sure that the problem will not be solved tomorrow. It should be the objective of the government however, to solve the problem by means of the second suggestion which is more accommodating to provincial autonomy and to the federal system as a whole.
The Minister of Finance has indicated that this is not only a theoretical or constitutional problem, but one of cost to the federal purse. Consequently, I suggest that the federal government consider the possibility in the future of paying a certain percentage of the business occupancy tax to those municipalities which levied that tax separately from the commercial property tax or, in other words, to those provinces which do not roll the taxes together. I am interested in questioning the minister on this topic when this bill gets into committee. I think that the principle 1 proposed is better than the present law. We should always strive for improvement, and my proposal would meet the needs of the future if not the possibilities of the moment.


Simon Leendert de Jong: Mr. Speaker, I wish to indicate my support for this bill. It is a marvellous bill and I congratulate the Minister of Finance (Mr. Crosbie) for bringing it before the House. I am sure that members on all sides will support the bill. So far, the government has not proposed many such bills, and it has been rather difficult for us. I know that the minister has been threatening the members opposite with an election if we do not rush in and support his proposed bills and suggestions, but indeed tonight we have something before us which we all can applaud. It has definitely been a long time coming.
Many municipalities, and particularly the ones around Ottawa, have definitely experienced numerous injustices in the past. I was not here for the occasion, but I understand that at one time the city of Ottawa threatened to cut off the water supply to the Parliament Buildings because of the injustices perpetrated by the previous government. Indeed, the previous government introduced this bill in 1976. They took a great deal of time before they actually introduced the bill, and then they eventually went through the motions of getting it through the House. I think, though, that we came to expect that from the previous administration. They moved slowly on a number of matters. That is why the people of Canada decided in May to see what a bunch of new fellows could do.
On this particular measure I congratulate the government not only for introducing the bill, but for giving it priority. 1 am sure that we will be able to pass the bill tonight. It is not a controversial measure and I think that all hon. members will support it. I see no reason why we cannot pass this legislation tonight.
The Minister of Finance will be happy, and he will be able to sleep tonight with a smile rather than a frown on his face. If the Minister of Finance is happy for an evening, the country will benefit, I am sure. I urge the House to send the Minister

December 3, 1979

of Finance home tonight with a smile so that he will have pleasant dreams and not nightmares.
The one thing that I wonder about is why some of the measures will be phased in. 1 recognize that in most cases the municipalities will be able to collect grants in lieu of taxes next year, but on some occasions it will be over a four year period.
Having accepted the fact that grants should be given in lieu of taxes, why should it take four years to actualize that truth? That is one of the major defects in the bill. Perhaps the minister could reconsider the matter and perhaps next year, if he is still here, he could speed up the process, so that this four year phase-in period could be reduced.
I do not wish to say any more on the bill. The previous speaker in a non-partisan way has raised some valid points. I am sure that the Minister of Finance will accept those points and will consider all suggestions wich have been made. There are problems which defy easy solution and which require a sense of good will and determination before they can be worked through and solved. Other than that, I have nothing more to say. We will support the bill.
[ Translation]


Armand Caouette: Mr. Speaker, like the hon. member who spoke before me, we also do not intend to keep this bill on second reading too long in this House but we want to give the government the possibility of doing something as it has once again taken a step favourable to municipalities which have been indeed complaining for years about the lack of revenue because of Parliament or government buildings.
We know that the city of Ottawa in particular had serious problems and nearly every year groups were formed to urge the government to give their fair share to the municipalities or cities which were asking the federal government to be a good citizen like all others and pay its property contribution. We also know, Mr. Speaker, that under the British North America Act and other regulations, a municipal or provincial government cannot force the federal government to pay property taxes.
Clause 13 of Bill C-3 says, and I quote:
1 3. No right to a grant is conferred by this act.
Such a conception, Mr. Speaker, could be justified in 1867 when the federal government and its administration amounted to a very small number of buildings, including the Parliament Building, the residences of the Governor General, the Lieutenant Governor, the Prime Minister and a few others. Today, the situation has changed and the federal government is the biggest administration in this country. Its buildings cover thousands of square feet and when one looks at the number of buildings the federal government has in our Canadian cities, those grants that the Minister of Finance (Mr. Crosbie) is proposing tonight, in Bill C-3, are indeed welcome.
Municipal Grants
I would not want, as the hon. member who spoke before me suggested, to take too much of the time of the House to move amendments to Bill C-3 if necessary. 1 would like to conclude by urging the minister to introduce other bills which could help our municipalities which for the past years have had to go heavily into debt.
Mr. Speaker, on behalf of my colleagues, I hope this bill will go through third reading quite rapidly so those municipalities can have the grants the minister described so well tonight.


Mr. Ken Binks (Ottawa West):: In speaking to Bill C-3, Mr. Speaker, the municipal grants act, 1979, I want to commend the minister for making the changes contained in this bill and making it one of the first pieces of legislation to be offered in the new Parliament.
1 was interested to hear the hon. member for Ottawa-Carle-ton (Mr. Pepin) ask how it will meet all the problems. Mr. Speaker, there is no bill that meets all the problems, but in my opinion Bill C-3 should be considered in the same sense as Bill C-20. Bill C-3 is as important in its own way as is Bill C-20, because it gives relief to municipalities while Bill C-20 gives relief to individuals in this country.
This bill is long overdue. The first municipal act was passed in this country in the Baldwin-Lafontaine ministry in 1837, and the last time municipal grants in lieu of taxes was discussed in this House was in 1957, when the question of taxation of the Crown by municipalities was fully discussed by ministers, and laid to rest.
This bill recognizes the urgent needs of more than 2,000 municipalities across Canada. The previous government diddled with this problem and the bill was reluctantly offered to the previous Parliament but did not pass second reading.
The hon. member for Regina East (Mr. de Jong) has asked why the legislation is to be phased in, and why it will not become effective within one year. It is for the same reason that Bill C-20 has to be phased in. that is, because of the present economic situation in Canada.
Municipalities across Canada, and the 2,000 municipalities that will benefit from this bili, the bedrock of democracy in Canada, suffered grievously because of the previous government's lack of initiative. By providing an additional $25,500,000 in annual federal grants in lieu of municipal taxes, this legislation will expand grant coverage to include almost all categories of real property owned by the government. It will provide, for the first time, full grants in lieu of real property taxes on defence bases in rural areas, national parks, historic sites, museums, libraries, art galleries, concert halls, reclaimed lands, and water conservation projects.
Most of the existing deductions from grants for municipal services provided by the government will be removed. Grants will be calculated using higher mill rates in some cases, such as for penitentiaries in provinces where real property taxes are levied at multiple rates. Grants will also be paid in respect of

December 3, 1979
Municipal Grants
certain types of property tax which are presently excluded from the grant system.
The municipal grants act will, for the first time, give some direction to Crown corporations regarding the grants they pay. This, Mr. Speaker, will alleviate the tax burden of potential private sector shoppers to an area such as Ottawa. Because the increased federal grants will be executed on a four-year phase-in period, this will allow municipalities to plan, in a responsible way, the yield they will receive to improve their service to residents and employees.
As the member for Ottawa West I particularly welcome the positive effects this legislation will have on the city of Ottawa. There has been much criticism expressed towards the former mayor and councillors for threatening to cut off the water supply and local services to Parliament and other government buildings, but I can see how they were frustrated. I want to pay tribute to the President of the Privy Council (Mr. Baker) for his influence in seeing that this legislation was offered early in this session.
I can appreciate the frustration of civic politicians in attempting to govern and plan for even minimum requirements in Ottawa. Ottawa will receive more than $6.5 million when this bill is completely phased in. More important, the uncertainty of not knowing in what directions the civic government should plan, will be removed.
Ottawa, the nation's capital, has found itself in distressing circumstances by reason of what the previous government did since 1968 to downgrade the importance of Ottawa as the capital of this country. The decentralization program-the most ill-conceived plan in this decade-in moving thousands of public servants from the Ottawa area, has left scars that will long remain. While it is proper to think of the national capital area as one geographic entity, it was scandalous to move thousands upon thousands of public servants across the river to Hull without even making provision to educate their children, without making adequate provisions for proper sewerage. There is no excuse in the world to send public servants to the four corners of Canada without proper planning in advance.
We need a strong federal presence right here in Ottawa, right here in the national capital, and this legislation will help to achieve that goal.
Canada is one of the most decentralized countries in the world. 1 am happy that this new government has stopped the madness of evacuation of the national capital. In my view, Mr. Speaker, this bill will help the national capital region. It is long overdue. But it is not all. I want to commend the President of the Treasury Board (Mr. Stevens) for his assistance in setting up a task force to consider future economic goals for the national capital area. One of the greatest unexploited resources in the national capital area has been the tourist industry. Construction of the Rideau Centre should go forward at once. Her Majesty, or an immediate member of her family should be in residence in Rideau Hall for at least one month every year. The recent heresy of making Ottawa and

Hull together in name by hyphen should be stopped. The capital of Canada is Ottawa; it is not Ottawa hyphen Hull, i There is no excuse for attempting to change the name of the capital, chosen in 1857 by Queen Victoria, from Ottawa to Ottawa hyphen Hull.
In introducing this important legislation, sir, the government has taken the first step in what I hope will be a number of provisions to restore vitality in the national capital. Ottawa needs a truly international airport and not the Mickey Mouse excuse we are required to put up with here in this city. 1 am speaking of the future of Ottawa and the hope that it will become an entity with a diversified economy not subservient to the federal government.
This legislation, Bill C-3, will help to create a new climate in Ottawa, and the number of groups at work today in this city can help remould the future of Ottawa. In addition to reaping the benefits of additional grants proposed by this legislation, Ottawa wants to attract candidates in the private sector area who can share in the tax burden of the community.
Bill C-3 is the avenue for growth potential, the underpinning of economic health of our capital and across the country. This government, Mr. Speaker, realizes we are big government, but this government states we will act as a private citizen for private citizens.


Mr. Gaston Isabelle (Hull):: Mr. Speaker, I am pleased to express my views on Bill C-3, a very significant piece of legislation for the municipality of Ottawa in particular, and 1 am most happy for that municipality that has been trying for a number of years to obtain an increase of grants in lieu of taxes in order to cover its yearly costs. However, this bill has been put forward at this point, because the previous government had already introduced remedial legislation on the subject of grants in lieu of taxes.
There is no reason for overcommendation. Although the bill is excellent, it should go much further. But 1 shall make no attempt at pulling it down or disparaging it. I feel it is overdue because the Canadian Federation of Municipalities and all neighbouring municipalities within the national capital area were requesting it. Maybe more should be done, because this is the first time that grants in lieu of taxes will be paid for military bases, museums and so forth. But let that be as it may.
It must also be realized that we have come a very long way in Canada in every area. Provinces have created new entities in addition to municipalities, such as regions, regional communities. We have one in Ottawa. There is one in the Quebec area of the national capital. I would not like to start an argument, but the hon. member for Ottawa West (Mr. Binks) suggested Ottawa was the capital of Canada. I think that no one will deny this fact except that, if you know the history of the area, you will realize that since 1893 all governments have always
December 3, 1979

attempted to include Hull, Ottawa and the area in some kind of region called the national capital area.
If 1 remember our history, in 1906, the then minister of finance, Mr. Fielding, held some kind of a referendum but only on Ottawa side, to ask if the people of the national capital would like a federal district like that of Washington. This proposal was rejected by only 600 or 800 votes. Had the Hull area been included according to the wishes of Sir Wilfrid Laurier, we would probably have a federal district like that of Washington. The situation might have changed tremendously, but when we say in this House that Ottawa is the capital of Canada 1 think that we are guilty of chauvinism. I believe that we live beyond that chauvinism, in what we call the national capital area. So, let us have the honesty to recognize the existence of the national capital area. The description of the municipalities included in that area is given in a measure passed by the government of the right hon. John G. Diefen-baker in 1958, I think. So we should pull down those psychological barriers and attempt to find the answer for our municipalities. It must be recognized that the national capita! area is a very special region more than any other in Canada, Mr. Speaker. This is the seat of the central government. It expanded on the other side of the river, in Hull. It even extends beyond the municipality of Ottawa.
I think that instead of discussing small, insignificant, useless and silly arguments, the members of the national capital area might join their efforts to promote the improvement and the economic and social development of the national capital area. The city of Hull, Mr. Speaker, is unique. For years, when Mackenzie King had recognized that Hull was part of the national capital area, the federal government did not do much for the city. It is only since 1968 that the federal government has decided to make a big move which displeased some but which was a way of catching up.
I believe that the people in the national capital area must be happy to see that the Canadian capital has an adjunct in the city of Hull. The sums which have normally been given to us parsimoniously by governments since the beginning of this century have been minimal amounts used for beautifying the area, but that did not stop everyone from coming to the Gatineau region for recreation. Gatineau park, one of the most beautiful in Canada, was developed, as well as the fantastic Fairy Lake Parkway, and quite recently magnificent buildings have gone up in Hull, which give a face lift to the whole panorama of the national capital area. On the other hand, this has caused problems to such a point that a brief submitted in 1971 by Hull municipal authorities to the Special Joint Committee of the Senate and the House of Commons on the Canadian Constitution says the following:
It plainly shows that for many years, always for beautification purposes of unquestionable value, the city of Hull has been progressively deprived ... of part of its territory ... of hundreds of taxable buildings and properties ... of part of its industries, in summary of an important part of its main source of revenue.
Municipal Grants
with no compensation formula in the least proportionate to the magnitude of this deprivation.
We do not mean that as a criticism, because 99 per cent of Hull area residents are very happy about the presence of the federal government and my predecessors and elected officials at every governmental level have supported projects to allow the federal government to expand around the Parliament Buildings.
In summary-
-I am still quoting from the brief-
-while the functions of the city of Hull have multiplied at the same rate as those of all other major municipalities, its commitments, which for a large part can be attributed directly to its proximity to the national capital, have increased substantially at the same lime as a major part of its tax base has disappeared gradually under the steamroller of beautification which has transformed taxable property into non-taxable green spaces.
Mr. Speaker, again last year, the mayor of Hull met with the then minister of finance, Mr. Chretien, to ask him simply why property value could not be calculated according to the method used by the Outaouais Regional Community which can make a real property assessment of all municipalities of the national capital region on the Quebec side of the river.
I think that method would have meant $850,000 more for Hull, which would have been a great help because it had to incur more expenses than any other municipality to provide services for the new buildings that were erected on its territory. On numerous occasions it was asked that the assessment be based on the regional community method or, as preceding speakers mentioned, that the business tax be used to a certain extent. But for reasons that would be too long to discuss, I think that for all practical purposes the federal government should find means to help municipalities on both the Ontario and the Quebec side, particularly those located in the national capital region since it differs from all others. I repeat that we are in the national capital region. To take exception to adding the name of Hull to that of Ottawa to form the name Ottawa-Hull is to show a partisan mind and is unworthy of all great statemen and any ordinary politician who has any common sense. So I think that those who think we are lost somewhere in the Quebec territory are wrong; we are on the border of Quebec, we live in the shadow of Parliament and we hold full Canadian citizenship, besides being residents of the national capital region of which I am immensely proud, Mr. Speaker.
Since we are talking about the national capital region, I would say that governments have a tendency to turn more and more towards regionalism, that is, that they realize regions are not all alike and that each one can succeed in every possible way in developing economically, in achieving a higher standard of living than another provided it is given adequate means to do so. Therefore, 1 think we must respect regionalism and that we must see to it that the national capital region is respected like all others. Let us give it the means to develop fully.

December 3, 1979
Municipal Grants
1 am very glad that this bill has been introduced in the House. I have nothing to say against it. On the contrary, 1 wish to congratulate the government for bringing it forward and 1 hope it will continue to introduce bills as positive as this one, Bill C-3, but I insist that we should find methods whereby we can make a positive contribution to the Ottawa-Hull region. When I say Hull, I refer as much to Ottawa; being from Hull and having lived in Ottawa for a long time I think that I am no more a resident of Hull than one of Ottawa; I am a resident of the national capital region.
So I hope that the government continues to bring those changes that have been required for a long time by the city of Ottawa, by the city of Hull and by the Ottawa-Carleton regional community, by the Communaute regionale de l'Ou-taouais, by the Canadian Federation of Municipalities, by all the other bodies, the chambers of commerce and so on which have attempted by submitting briefs to urge the government to assist municipalities.
Before finishing, Mr. Speaker, 1 would like to say that I am happy to live in the national capital region, that I am pround of the city I represent, that I am happy to associate with my Ottawa colleagues and I hope they are glad to have me as their colleague representing Hull.


John Leslie Evans: Mr. Speaker, 1 welcome this opportunity to add to the comments of my colleagues on this bill which affects municipalities across Canada, particularly Ottawa. 1 am also happy to see this government follow the lead of the former government in recognizing the need for additional moneys to the municipalities. However, 1 do not believe that the present bill goes nearly far enough in overcoming certain inequities in the current grants structure, as 1 will indicate shortly.
In my maiden speech to this House, 1 urged the government to move quickly on this matter of grants in lieu of taxes. I stressed the importance of it to the municipalities in the national capital region as well as to municipalities across Canada where there is a federal presence. The city of Ottawa has by far the lion's share of federal properties. As a result it has lost the most in the past and stands to gain the most with this legislation before us.
Bill C-3 will serve to eliminate some of this burden and should help prevent additional tax hikes to the people of Ottawa by the municipal authorities, but it will not eradicate all of the inequities. Allow me to explain, Mr. Speaker. While Bill C-3 provides for the inclusion in the grants formula of most federal property previously excluded, it fails to deal with the loss of revenue to cities which results from the federal government's inability or unwillingness to pay business occupancy taxes. Therefore, while the new grants formula will overcome the inequality of the past resulting from underpayment of property taxes, it fails to address the inequities associated with non-payment of these business taxes.

Although I certainly agree that the federal government should not be as a business, I do believe that the federal government should provide compensation to municipalities which reflects their loss resulting from the fact that the government, and not a private business, occupies land within the municipality. Bill C-3 will not achieve this result, and it is a major omission. 1 estimate that the revenue loss to the city of Ottawa resulting from this omission is approximately $15 million per year. Now I should not lay the full blame at the door of the federal government. While it is true that the federal government is precluded from paying business taxes, this has been overcome in other parts of the country where the province simply allows the municipalities to incorporate the business tax within the commercial property tax category. Prince Edward Island has done this. Unfortunately, Ontario has not, and since Ontario shows no signs of moving, there is but one alternative. That alternative is for the federal government to provide a special grant in lieu of business taxes. 1 hope that the government will seriously consider this option and I intend to push for its adoption in the near future.
Mr. Speaker, 1 would like to touch on another issue if 1 may. While I welcome this bill, there is a bit of irony to be seen in its reintroduction at this time. The government has stated time and lime again its intent to cut the public service by at least 60,000 jobs over the next three years. This will cause irreparable damage to my constituents, to the city of Ottawa, and to the business community. This will happen irrespective of the passage of Bill C-3. The effects of this cut-back policy will greatly weaken the city's financial base. The present high taxes in Ottawa will have to be increased in all likelihood as a result of this government's commitment with regard to the public service. Therefore, while the government promises relief with one hand, it takes it away with the other.
It would appear, Mr. Speaker, that this government is playing a very dangerous game and the city of Ottawa is caught in the middle. It's a first class juggling act. First they promise cuts to the public service and then they try to make amends by giving the city money. This will not make amends to those public servants affected by the cuts. It will not make amends to those businessmen who depend on the buying power of public servants who will soon join the ranks of the unemployed. It will not improve the morale of a city which is coming to realize that it is facing a grim future. While I repeat I welcome the increased grants to Ottawa, it should be well understood that this in no way compensates for the other drastic measures being inflicted upon this city and upon my constituents.
Mr. Speaker, there is an additional case against this government which once again demonstrates its insensitivity to the problems of Ottawa. Within two weeks, the Eastern Ontario Rural and Economic Development Subsidiary Agreement will be signed between the federal government and the province of Ontario. This program has a budget of $50 million over the next five years out of which $10 million is designated for small business assistance. However, this government, contrary to the expressed wishes of the province of Ontario, has decided that
December 3, 1979

small businesses in Ottawa-Carleton will be ineligible to participate. Apparently, Mr. Speaker, the federal government feels that small business in Ottawa-Carleton is thriving and is not in need of the extra help. Yet small businesses in other areas of eastern Ontario will be eligible for grants up to $100,000. This is strange talk for a government which has publicly acknowledged that Ottawa will require special assistance to help cushion the impact of its public service policies on the business community. By eliminating the opportunity for small businesses in Ottawa-Carleton to share in this program, it is eliminating an opportunity to promote the diversification which the government admits will be required over the next decade. Mr. Speaker, this is but one more example of the inconsistent approach to policy development which is becoming the hallmark of this government.
I call on this government to remove the prohibition on Ottawa-Carleton firms now found in the proposed Eastern Ontario Rural and Economic Development Subsidiary Agreement. I am not calling for special status for Ottawa, only that Ottawa firms be allowed to compete on the basis of merit for assistance funds which will be made available. Certainly, a government which purports to value efficiency and free enterprise cannot argue with the granting of assistance to the firms shown to be most worthy on the basis of merit.
In conclusion, Mr. Speaker, this government is refusing to recognize the legitimate claim of the municipalities with regard to grants in lieu of business taxes in Bill C-3. Further, they are casting a blind eye on small business in Ottawa by denying such businesses access to assistance which is available to small business elsewhere in Eastern Ontario. This is indeed a sorry state of affairs for Ottawa, and while I wish to state once again that I will support the passage of Bill C-3, 1 strongly and sincerely urge the government to move to overcome the inequities I have described with regard to grants in lieu of business taxes, to remove the prohibition on the participation of Ottawa firms in the Eastern Ontario Rural and Economic Subsidiary Agreement in order to help this city in its attempts at economic diversification, and finally, Mr. Speaker, to reconsider its arbitrary and ill-conceived plan to decimate this country's public service.

Eton. J.-J. Blais (Nipissing): Mr. Speaker, 1 thank the hon. member for Ottawa Centre (Mr. Evans) very kindly for having given me a few minutes to take part in this debate which is indeed very stimulating. 1 merely want to stress one of the aspects of this bill which has not been touched upon. I would not want it to be overlooked since, to my mind, it deserves to hold public attention. I am thinking here of the transformation of our military bases system. As you know, Mr. Speaker, I have the honour of representing the riding of Nipissing which has, within its boundaries, one of the most important military bases in Canada, importance which will grow as we have just heard that capital investments in the base will be doubled in
Municipal Grants
order to transform it into the communications centre for the whole air control system in Canada.
Now, if I understand correctly, the Minister of Finance (Mr. Crosbie) indicated very clearly that there will be changes of great benefit to those municipalities that apply for them. All 1 want to do is to stress that it is imperative for the municipalities to apply for those benefits because, as clause 3 of the bill indicates clearly, those funds will be available to the municipalities that recognize their advantages and consequently apply for them.

So, for the people of North Bay in my riding it is essential that this bill which is, of course, imbued with Liberal principles-


Some hon. Members:: Oh, oh!


Mr. Blais:: -be passed through this House with all due dispatch in view of the major advantages it provides for communities which are involved with small business.
1 am very pleased this legislation has been introduced because there needs to be greater integration between municipalities which serve military bases and the bases themselves. North Bay has always enjoyed the tremendous advantage of having the warmest relationship with its military base, CFB North Bay. The whole process whereby negotiations are now to be undertaken between the city and the Department of National Defence in order to identify the increases to which North Bay will be entitled is going to enhance that very warm and remunerative relationship between the two areas.
1 look forward to the passage of this legislation and to assisting the Minister of National Defence (Mr. McKinnon), along with any members on that side of the House who may think they do not have sufficient experience, to reach the best possible arrangement between the military and the municipal authorities. 1 would hasten to advise the municipalities of North Bay of the worth-while advantages of the legislation which is coming forward.


An hon. Member:: Let us have the bill, then!


Walter David Baker: Send them a copy of your speech!


Mr. Maurice Harquail (Restigouche):: Mr. Speaker, 1 cannot forgo the opportunity to speak on this important bill.


Mr. Darling:: Filibuster!


Maurice James Harquail: I want to associate myself with the hon. member for Ottawa-Carleton (Mr. Pepin) as well as with the hon. member for Nipissing (Mr. Blais). It is important to consider assisting municipalities, especially in the area of municipal services such as water, sewage, and that type of development.


Mr. Deputy Speaker:: Order, please.

December 3, 1979
Adjournment Debate



PROCEEDINGS ON ADJOURNMENT MOTION

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

George Alexander (Alex) Jupp: Mr. Speaker, on November 15 1 asked a question of the Minister of National Defence (Mr. McKinnon) regarding the cruise-missile guidance system contract. The minister's response was reassuring in that he confirmed there was no substance to the suggestion of a Liberal defence critic, the hon. member for London West (Mr. Buchanan), that the contract was in jeopardy.
I would like to comment on questions which have been raised in recent weeks by the defence critics of both opposition parties regarding the new fighter aircraft program.
The positions of the two parties are different, but both are ill founded for different reasons. The Liberal party now seems to take the position that the process set in place by its government should now be set aside to include Northrop's FI8L on the "short list" which currently includes the McDonnell Douglas F18A and General Dynamics' F-16. 1 am at a loss to understand the Liberal position.
Mr. Danson, as the minister of national defence, reported to this House on November 23 last year why the F18L would not be included for final consideration, and 1 quote:
-we have assessed as very considerable the risk of committing Canada to buying a sophisticated aircraft that is not in service with any other country. At this time, I consider all the various types of risks which could be involved in the development and initial introduction into operational service of this aircraft are greater than we either need or are prepared to accept.
This conclusion is shared by the present minister and has more recently been echoed by the minister of defence for Australia. The Hon. D. J. Killen reported to the Australian parliament on November 21 of this year the following:
Northrop I8L has been excluded because there is no firm program and there could be no assurance that the aircraft would be available to meet the time scales sought from our new tactical fighter. We do not believe that this aircraft, which is comparatively expensive, has advantages sufficient to continue detailed evaluations.
The Liberal party has either flip-flopped on this issue, as on so many others, or it is undertaking a stance of political opportunism at the expense of Canada's military defence. Neither does credit to the official opposition of this Parliament.
The position of the New Democratic Party is at least consistent. Its position, as expressed through questions by the hon. member for Selkirk-Interlake (Mr. Sargeant), is that consideration of the new fighter aircraft program as an instrument of defence should be put over until Parliament has had an opportunity to undertake a review of our defence position and future requirements. The problem with this position is that it fails to appreciate two significant factors. First, over the past

decade the Soviet Union has engaged in a massive military balance. Whatever the motives of the Soviets in engaging in such a land, sea and air force build-up, the consequences are serious for the principle of balance which has tenuously preserved world peace since 1945.
Second, the previous government, through neglect or intent, allowed Canada's armed forces to degenerate so that the equipment for all three forces is antiquated to the point where Canada can contribute very little to the defence of Europe through NATO or, indeed, to the defence to North America.
These two factors, the increase in Soviet military strength and the degeneration of Canada's defence capability, were vividly revealed in the CTV interview last evening with Major-General Herbert Pitts on the W5 program. General Pitts, who formerly headed the Canadian Airborne Regiment, stated that Canada's northern defence forces are so inadequate and antiquated that as few as 1,000 Soviet troops could take over our northern installations. The NDP position simply fails to recognize these two factors. If the government were to heed its wish for a delay, the consequences could be serious for Canada.
Members of the NDP might counter my argument by saying that if Canada is so defenceless, why do we not simply concede our weakness to the United States and ask the U.S. to assume our military responsibilities both in Europe and North America? However, such a request would constitute an international declaration that Canada is no longer a sovereign nation, that we are incapable of assuming our share of responsibility for defending the free world. That is not the position which will be taken by this government.
On the contrary, this government is committed to a systematic re-equipment program which will restore gradually our once-proud armed forces to the point where Canada can assume its share of responsibility for the defence of our allies in Europe and for the territorial integrity of the northern part of this continent. Having regard for the dreadful state of our national finances which we inherited from the former government, this will not be an easy task. Nonetheless, it is one we assume as a new government, recognizing that to do otherwise would constitute a betrayal both to the members of our armed forces and to the sovereignty of this great country.
Let me conclude with a brief comment on the new fighter aircraft program itself. The program is of considerable importance to my constituency of Mississauga North because of the presence of defence production facilities. It is largely because of this constituency interest that I spent part of the past summer, along with a number of my colleagues, on a defence caucus committee. We were able to review the submissions of aircraft manufacturing companies and to weigh the consequences from both a military and industrial benefits point of view. As well I had the opportunity, while in Germany, to talk to several of our Canadian fighter pilots. This experience left no doubt in my mind that the choice for Canada is clear.
December 3, 1979

The F-18A is a generation ahead of its competitor, will be a much safer aircraft, more strategically viable for its dual role in North America and Europe, and offers the best industrial benefits program in terms of firm commitment, life cycle support, and long-term job creation. I trust that in the next week or so that judgment will be confirmed by the announcement of the Minister of National Defence and Minister of Veterans Affairs.


Mr. Dan McKenzie (Parliamentary Secretary to Minister of National Defence and Minister of Veterans Affairs):: Mr. Speaker, in reply to the question raised by the hon. member for Mississauga North (Mr. Jupp) that somehow Canada might lose the $545 million cruise missile guidance business which had been committed by McDonnell Douglas in their draft contract for the new fighter aircraft, I should like to repeat the assurance given by the Minister of National Defence and Minister of Veterans Affairs (Mr. McKinnon) in the House on November 15, 1979, that the correspondence in question made no reference to actual cancellation of a contract.
The McDonnell Douglas Corporation in their NFA draft contract listed $545 million worth of work on the cruise missile navigation system as part of the package of their industrial benefits and offsets. The contract was then awarded to Litton Systems (Canada) Ltd. as a second source.
In late October, Mr. Dale Church, United States deputy under secretary of defence, acquisition policy, in a letter to the Department of Industry, Trade and Commerce, questioned the right of McDonnell Douglas to use this item as an offset and asked that the Canadian government remove it. 1 wish to advise the hon. member that the Department of Industry, Trade and Commerce, in consultation with the new fighter aircraft program office of the Department of National Defence, in fact prepared a reply to Mr. Church explaining the Canadian position. We are still awaiting a reply from the United States government, but it is expected that this reply will resolve any misunderstanding which might have led to Mr. Church's letter.
In general, because the industrial benefit commitments of McDonnell Douglas to Canada is expressed in terms of total dollar values and is not tied to specific work packages, Mr. Church's letter in any case would not have affected the substance of their offer. In particular, I am pleased to advise the hon. member for Mississauga North that the same Mr. Church has been quoted in Aviation Week & Space Technology of November 12, 1979. He is reported as saying that Litton Systems (Canada) Ltd., as an affiliate of its parent company, "has come up to speed", on the cruise missile guidance program, "is doing excellent work and we expect it to be a very effective competition to its sister division in the United States."
1 think the hon. member for Mississauga North has stated very well the policy or non-policy of the opposition parties, in particular the fact that the Liberal party now is taking the official position that the final decision on the new fighter aircraft should be delayed. They in fact were the government
Adjournment Debate
which made the initial decision that this aircraft be acquired, and set its initial timetable for development.
As for the position of the New Democratic Party, although their position certainly has been more consistent, it is nevertheless wrong in that it does not recognize the need for development and deployment of the new fighter aircraft, and they are opposed to Canada being members of the NATO and NORAD agreements. In addition, New Democratic members are against the defence of Canada and never make mention of the communist build-up of arms.
As to the choice of a fighter aircraft, I am sure the hon. member can appreciate that it is most important that the government maintain this as an open and fair competition between the two finalists.


TREASURY BOARD-SALE OF CROWN CORPORATION TO PRIVATE ENTERPRISE
Mr. Hal Herbert (Vaudreuil):: Mr. Speaker, in September the President of the Treasury Board (Mr. Stevens) announced the first phase of privatization. He was to be assisted by a Treasury Board secretariat and an advisory committee. In answer to a question on November 19 the President of the Treasury Board said that "the terms of reference have been substantially identified and agreed to". He said:
The advisorsy group . . . will likely be formed later this month-
The group was to be composed of a representative group of Canadians from coast to coast, both from the business community and from other sections of our economy. He said, "they will be called together to make decisions".
Today the President of the Treasury Board announced that the special advisory board, 14 in number, will offer both advice and suggestions to him and to the Treasury Board privatization unit. He said that the privatization unit's work is well advanced and it is now ready to brief the new advisory board.
The minister then went on to say that the chairman of the board is Derek Hannaford, who has been active in the Montreal and Canadian investment communities for many years. Looking for more information on this 1 noted that in the biographical notes the list shows Mr. Hannaford as president of Derhan Limited and director of Mastorak Limited. 1 asked our friendly computer for information on Derhan Limited and I struck out. I tried Mastorak Limited and received a response as follows:
The Quebec Securities Commission has issued a cease-trading order in shares of Mastorak Ltd. for failure to comply with disclosure requirements.
This apparently was reported in The Globe and Mail on November 2 of this year.
However, not to be discouraged, and because the President of the Treasury Board is a former bank president, I thought 1 should have a look at the rest of the board. Sure enough, 1 was not disappointed. Just looking at banks, for example, we have directors from the Canadian Imperial Bank of Commerce,
1974

December 3, 1979
Adjournment Debate
from Continental Bank, from the Bank of Nova Scotia, from the Montreal City and District Savings Bank, from the Toron-to-Dominion Bank, and from the Bank of Montreal. All I can say to the President of the Treasury Board is, shame on him; he left out the Royal Bank.
There are also other members of this advisory board, for example, the chairman of the board of Empire Life Insurance Company and also a director of the Argus Corporation. Five members of the board are presidents of various companies, one is a past president of a corporation, and one is a consultant to a corporation. This, of course, is in no way a full summary of the activity of this group in the business world. One gentleman is on the boards of some 20 companies and groups, and the average is six companies and groups per board member.
Undoubtedly we will not be short of business expertise and, as the minister said in reply to my question in the House, since they will be called together to make decisions they will undoubtedly be qualified to judge if the price is right from the point of view of a banker and from the point of view of a president of a large corporation. This, however, will not answer the critical and, in the opinion of those of us in the opposition, the far more essential questions as to (1) why, (2) when, and (3) how?
Privatization as such, or the sale of Crown corporations, is not something that the official opposition opposes in principle. Why should it? Canadair and de Havilland were both up for resale at an appropriate time and under predetermined conditions. Nordair was bought for resale. The inclusion of the Canadian Development Corporation in the so-called privatization list does not hold water. The CDC was formed as an instrument of government policy. The increase in public shareholding is fully consistent with the original intention when CDC was formed. Thus, to include CDC on this list is a phony attempt to boost the so-called privatization list.
That leaves Petro-Canada, which has already been well covered in debate. Eldorado Nuclear and Northern Transportation are companies of such a nature that offers to purchase are feasible propositions. One wonders a little bit about the loss record of Northern Transportation. However, each of these companies on the list is presently serving as an instrument of government policy. Thus, any sale entails a change in government policy, and it is this change that needs to be explained.
I do not think that we will get an explanation on this matter from the advisory board because, according to the news release, it has as its terms of reference the purchase by Crown corporation officers, continuing employment for employees, the prevention of foreign ownership, the facilitation of share purchase by employees, purchase by other levels of government, acquisition by a competitor and lessening of competition, and the extent of share purchase by employees.
That still leaves us with the question of what is the change in government policy. These companies were bought to be an instrument of government policy. Many of them were pur-

chased for resale and, therefore, there is nothing new in that respect except that they were to be resold under certain predetermined conditions. 1 would like the President of the Treasury Board to tell us the present government policy on this matter. In other words, what are the conditions under which the government intends to dispose of the companies which have been listed so far for privatization?


Sinclair McKnight Stevens: enterprises, it would be a terrible oversight not to include the CDC.
1 am very pleased to have at least this one member of the official opposition so supportive of our privatization moves, Mr. Speaker. If he can radiate his opinion to all other members of the opposition on that side of the House, we may have a unanimous vote at some stage in favour of privatization.


ENERGY-GOVERNMENT CONTROL OVER OIL PRICES
Mr. Svend J. Robinson (Burnaby):: Mr. Speaker, I should like to follow up a question which 1 put to the right hon. Prime Minister (Mr. Clark) on October 30 and raise an issue which has been before this House many times in the past six or seven years. 1 refer to the question of the investigation by the Department of Consumer and Corporate Affairs into the petroleum industry.
1 want to quote tonight from a question raised in this House on October 24, 1973, more than six years ago. The question is of particular interest because the gentleman who raised it is now the Minister of Consumer and Corporate Affairs (Mr. Lawrence), and is responsible for the investigation presently under way. This was some six years ago and the member, who is now the minister, defined the issue as "urgent". He also demanded, and again 1 quote "-that the House be informed of the contents of the report when it is made."
Six years ago, Mr. Speaker, the Minister of Consumer and Corporate Affairs thought that this issue was urgent. He was so concerned that he raised the issue again on January 4, 1974, not quite six years ago. 1 want to quote the whole question this time because I think it is relevant. He asked:
In view of the fact that in the United States an investigation into exactly the same matter and involving exactly the same companies started after the investigation began in Canada and the United States government has now started prosecution in the courts against these same companies, can the minister possibly explain to us why there has been delay in regard to this matter in reporting to him and to the government of this country?
The man who answered these questions, Mr. Speaker, was the hon. member for Windsor West (Mr. Gray), who at that time was minister of consumer and corporate affairs. This was before he was unceremoniously dumped from the cabinet for allegedly being too progressive and before he was revived from obscurity when the Liberal party needed to prove that they were not the heartless tycoons the public perceived them to be. In 1973 and 1974 he was still the minister of consumer and corporate affairs and he was still doing a fairly good job. He must be commended for having the courage to undertake the investigation in the first place. After all, we all know that the oil companies he tried to investigate have been bankrolling his party for years. In any event, Mr. Speaker, the progressive cabinet minister from Windsor West was subsequently dumped, possibly because of this very investigation, and was sent off to the ignominy of the back benches.
After six years of investigating, however, he lost his temper. He took a very courageous stand, and one for which he should be congratulated. He became frustrated by the foot-dragging on the part of the government, headed by his colleague, and in
Adjournment Debate
fact issued a public statement calling for quick action on the petroleum investigation. What he asked for was as follows:
Continuing delays cannot help but raise questions in the minds of the public as to the degree of attention and priority that is being given by the government to the Combines Branch of the Consumer and Corporate Affairs department, to the important matters which the 1973 application called on the director to inquire into. These were important in 1973, they are no less so today.
That was in January, 1974, so naturally we would expect the new minister, who was so concerned six years ago that the matter would be dealt with expeditiously, would do everything in his power to ensure that the investigation was concluded post haste. What happened, however, was as follows. There has been no date yet set for completion of this particular investigation. Even the last Liberal government promised the matter would be concluded by the end of this year. On the other hand, we have the minister and his representatives who were so concerned that the inquiry be completed some six years ago, now saying, "Well, we are going to delay it and it may not be until March," and only a couple of weeks ago they finally got around to appointing counsel for the inquiry.
Of course we should not be particularly surprised that the government has cold feet on this issue. This particular government receives as much money as the Liberals do from companies that are being investigated.
However, one of our major concerns is that in the background we have the scenario for the dismantling of PetroCan which is partly as a result of this government's very close connections with Imperial Oil. So the delay in the prosecutions is coming about partly as a result of these rather cynical attempts to dismantle PetroCan. Our concern is that one of the reasons PetroCan is being dismantled is because it gives Canadians a real picture of what is going on in the petroleum industry. In fact these are the kinds of figures and facts and the window on the industry which the present government does not want to see existing.
There is one other area which is of some concern in this whole energy field, again talking about the cynicism of the Conservative government, and that is the whole question of aid to rapid transit. Certainly the Liberal party has nothing to brag about in this area after cynically breaking its particular promise in 1974. However, the tories had indicated that they were concerned. They promised the people of Canada that there would be action in terms of financial assistance for rapid transit. But what did they do, despite the concern expressed before the election even by such persons as our friend the slasher, from York Peel? They cried. They moaned. They insisted that rapid transit financing was essential. They said they would do something about it when they got into power.
To date there has not been a single mention in the throne speech nor a penny whatsoever for rapid transit. 1 think that the concern that has been expressed, not only in my own constituency in Burnaby but throughout the lower mainland,

December 3, 1979
Adjournment Debate
and in other areas of Canada, with respect to this essential question of rapid transit funding, relates to a larger concern about the integrity of this government and the promises that they are keeping and the promises that they are not keeping. One of the results of that is that we have seen today the most startling Gallup poll results in some time, showing that the government is even less popular than its predecessor, and even less popular than the R. B. Bennett government.
To conclude, 1 would say that we are concerned about the question of energy pricing. We are concerned about the dismantling of PetroCan. We insist that there be federal government aid to rapid transit. We want the people of Canada finally to have some answers about a sensible energy policy for Canada instead of the kind of dithering flip-flops which have taken place so far.


Mr. Bob Jarvis (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, I would like to assure the hon. member for Burnaby (Mr. Robinson), now that the hon. member for Durham-Northumberland (Mr. Lawrence) has assumed the portfolio of Minister of Consumer and Corporate Affairs, that there will be a resolution to the problem that he referred to in his dissertation this evening.
Resolution of the petroleum inquiry has been given a very high priority by the director of investigation and research and the Department of Consumer and Corporate Affairs. The director of the Combines Investigation Act, Mr. Robert J. Bertrand, has indicated that the public, as well as the parties directly concerned, deserve to have the results of the inquiry confirmed as quickly as possible. As the director has indicated publicly, the inquiry has been progressing, and the evidence
obtained during the course of the inquiry will be considered in terms of the relevant provisions of the Combines Investigation Act.
Inquiries are conducted in private pursuant to section 27(1) of the act. To proceed otherwise is to prejudice the rights of those whose affairs are being examined. Under section 15 of the act, the director may refer the evidence arising from an inquiry to the Attorney General for Canada for consideration of whether the evidence warrants prosecution or any other proceeding under the act. In this case, if the Attorney General decides a prosecution is warranted, the matter would become public knowledge when proceedings commenced before the courts.
In addition, under section 18, the director may, at any stage of the inquiry, submit a statement of evidence to the Restrictive Trade Practices Commission, and the commission would produce a report reviewing the evidence in the matter and make recommendations as to remedies. Such a report would become public under the conditions set down under section 19. Given the provisions of the act, to say more would constitute interference in this due process of law which is now going forward promptly.
I would advise the hon. member with respect to the government's position and policy with respect to PetroCan that he will be among the first to know when that policy is announced in the House, in due course.


Mr. Deputy Speaker:: The motion to adjourn the House is now deemed to be adopted. Accordingly, this House stands adjourned until tomorrow at 2 p.m.
Motion agreed to and the House adjourned at 10.30 p.m.

Tuesday, December 4, 1979