1979-12-12

[Stage Direction]
[English}

Mr. Maurice Foster (Algoma):: Mr. Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity. In view of the provisions of the budget last night which will have the effect of imposing a new 15-cent per gallon excise tax on fuel for farm tractors and equipment and a 25-cent tax per gallon for farm vans and trucks, and considering the devastating effect this tax will have on farmers' costs which are already rising rapidly due to inflation, and considering that these extra costs will result in higher food costs to the consumers of the country, I move, seconded by the hon. member for Essex-Kent (Mr. Daudlin):
That this increase in excise tax for fuels used on farms be reconsidered by the government and cancelled.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE BUDGET
Mr. Yvon Pinard (Drummond):: Mr. Speaker, 1 rise under the provisions of Standing Order 43 to ask for the unanimous consent of the House to move a motion on a matter of urgent and pressing necessity.
1 move, seconded by the hon. member for Rosemont (Mr. Lachance):
That the Leader of the Social Credit Party of Canada communicate forthwith with Mr. Levesque to know whether he should support the people or the multinationals in the face of the Progressive Conservative budget of last night.


NUCLEAR POWER
Mr. Bill Blaikie (Winnipeg-Birds Hill):: Mr. Speaker, 1 rise pursuant to Standing Order 43. In view of the fact that since June of this year many Canadians have been under the false impression that this government genuinely wished to review the development of nuclear power in Canada and intended to set up a parliamentary inquiry, I move, seconded by the hon. member for Vancouver-Kingsway (Mr. Waddell):
That this House instruct the government to get moving on the establishment of its promised parliamentary inquiry into nuclear power.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


NATIONAL SECURITY
Mr.   Tom@: Mr. Speaker, I rise on a matter of urgent necessity arising from the quotation by CJOH TV Ottawa from a document classified "Top secret; Canadian eyes only" and expressing priority being given by the Russian intelligence service to the Department of Industry, Trade and Commerce and the National Research Council. I move, seconded by the hon. member for Hamilton Mountain (Mr. Beattie):
That the government make public all details in this regard, specifically mentioning the parts played by Captain Valari Nicolayevich Smirnov of the Russian GRU, Yuri Demitriyevich Shcherbina and Vasaliy Andrevich Shimchik who has been labelled a suspected member of the Russian military intelligence by the RCMP security service, and specifically that the government investigate why the former government never permitted the Canadian people to know the details.


Mr. Speaker:: Such a motion can be introduced for debate only upon unanimous consent. Is there unanimous consent?

December 12, 1979


Some hon. Members:: Agreed.


Some hon. Members:: No.


AGRICULTURE
Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, under the provisions of Standing Order 43, I ask for the unanimous consent of the House to move a motion dealing with a very important matter.
Considering that the Canadian Chicken Marketing Agency has announced that under a Canada-United States agreement the import quota of American poultry was 22,250 tons this year and that it would be doubled next year, considering that the Minister of Industry, Trade and Commerce is issuing additional import permits and that Ontario has invaded the Quebec market with its quota, following the Quebec threat to withdraw for those reasons from the Canadian Chicken Marketing Agency, I move, seconded for the hon. member for Beauce (Mr. Roy):
That the House urge the government to renegotiate the Canada-United States agreement of October 22, to protect the interests of Canadian producers as well as Canadian slaughterhouses.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


REQUEST FOR INQUIRY INTO POTATO INDUSTRY-MOTION UNDER S.O. 43
Mr. Eymard Corbin (Madawaska-Victoria):: Mr. Speaker, under the provisions of Standing Order 43, 1 should like to move a motion on a matter of urgent and pressing necessity. 1 move, seconded by the hon. member for Westmorland-Kent (Mr. LeBlanc):
That the government immediately establish an independent commission of inquiry or, if it prefers, a royal commission into all aspects of the potato industry in Canada.


Mr. Speaker:: In accordance with Standing Order 43, such a motion can be introduced for debate at this time only upon unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


FINANCE
Mr. Russell MacLellan (Cape Breton-The Sydneys):: Mr. Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity regarding the projected increased profits in the oil industry of 1,000 per cent, meaning that by the mid-1980s foreign-owned firms producing oil and gas in Canada will be either repatriating large flows of dividends or acquiring large, new Canadian investments outside the non-conventional oil and gas producing sector. Therefore, I move, seconded by the hon. member for Essex-Kent (Mr. Daudlin):
That the government allow the oil and gas companies to retain a certain percentage of their quarterly profits, while placing the balance with the government in trust, to be drawn down by and paid to the respective oil and gas companies if and when these drawdown amounts have been expended by those companies in oil and gas exploration or certain aspects of research and development.


Mr. Speaker:: This motion can be introduced for debate at this time only upon unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE BUDGET
Mr. Ray Skelly (Comox-Powell River):: Mr. Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity. In last night's budget speech, the Minister of Finance (Mr. Crosbie) took pride in comparing his budget to the farsighted budget delivered by his grandfather to the Assembly of the Dominion of Newfoundland 51 years ago.
Noting that shortly after the delivery of that budget the Dominion of Newfoundland was bankrupt and that the Dominion was compelled to seek colonial status from the government of Great Britain, I move, seconded by the hon. member for Selkirk-Interlake (Mr. Sargeant):
That the Prime Minister table in this House records of any discussions or any correspondence between the Government of Canada and the British government dealing with the possible surrender of responsible government to London.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order.
December 12, 1979


CANADIAN BROADCASTING CORPORATION
Mr. Don Cameron (Kamloops-Shuswap):: Mr. Speaker, 1 hope hon. members will agree to my motion. I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity. Last Sunday night, on the CBC program "The Nation's Business", three answers were edited from the tapes of the House of Commons. The hon. gentlemen asking the questions clearly lacked the moral fibre, the courage of their convictions and the intestinal fortitude-


Some hon. Members:: Order.


Mr. Speaker:: Does the hon. member have a motion pursuant to the provisions of Standing Order 43?


Mr. Baker (Nepean-Carleton):: He is just coming to it.


Donald Niel (Don) Cameron: -to include the answers to the questions as given by the Prime Minister (Mr. Clark). So that taxpayers will know the answers as well as the questions, I move, seconded by the hon. member for Brampton-Georgetown (Mr. McDermid):
That they use their next time allotment for this purpose.


Mr. Speaker:: Order, please.


THE BUDGET
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I move that this House notes that the only generous part of the budget delivered by the Minister of Finance (Mr. Crosbie) was on page 83 of the Budget Papers, namely, that he is removing the duties on Bible recordings, certain bird-scaring devices and also the duty on farm storage tanks for animal waste.


Some hon. Members:: Oh, oh!


Mr. Jarvis:: What is the matter with that?


Lorne Edmund Nystrom: In light of the fact that the Conservative party now has broken almost all the promises it made prior to the election, 1 move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House instructs the Minister of Consumer and Corporate Affairs to prosecute the Progressive Conservative Party of Canada for misleading advertising.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Oral questions.
Oral Questions



ORAL QUESTION PERIOD


Hon. Allan J. MacEachen (Cape Breton Highlands-Canso):: Mr. Speaker, I have a question for the Prime Minister. In view of the budget statement last night, painting a picture for the future for Canada of double-digit inflation, increased unemployment, higher taxes and slower economic growth, is the Prime Minister contemplating any special steps to try to convince the House of Commons that it should support this budget?
Will he, for example, be writing to the leader of the Social Credit group before the votes, giving him special reasons why that group should support the budget and, if so, would he make available copies of his correspondence to the rest of us, which might assist us in considering this extraordinary document?


Right Hon. Joe Clark (Prime Minister):: Mr. Speaker, the special measures that we intend to use to encourage the House to support the budget are the measures that were introduced and announced by the Minister of Finance last night in a budget which has been widely celebrated as the most honest budget in years.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: It is also a budget which spells out specifically steps the government intends to take-steps, by the way, which the former government, although they were urged upon it, refused to take-to help small business, to help women and to help a number of groups in the country. We believe the measures that are included in that budget will recommend themselves to the House. If the House is interested in having economic recovery generated in the country, then the House will support this budget.


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: Mr. Speaker, in view of the Prime Minister's statement to the House on October 18 that inflation was public enemy number one, would he relate for me that objective with the very heavy burdens that are now placed in this budget on low and middle-income Canadians? Has he now decided to fight public enemy number one on the backs of low and middle-income Canadians, or have those groups become the new public enemy of the government?


Some hon. Members:: Oh, oh!


Charles Joseph Clark: Mr. Speaker, the budget proposes to move this country towards a significant reduction in deficits, which will have an effect on bringing inflation down. The budget also proposes to change the Liberal practice of having Canada rely

December 12, 1979
Oral Questions
on unstable, expensive sources of foreign oil, which reliance is a significant contributor to inflation in the country.


Allan Joseph MacEachen: Mr. Speaker, 1 am getting a number of homilies from the Prime Minister, but no answers to my questions. May I ask him one final question? In view of the fact that the substantial increases in the budget are intended to finance the tax credit program for home owners-and that is obvious-will the Prime Minister justify, or explain to the country why all the taxpayers in Canada should be called upon to finance a program which is intended to serve and help only a special group in the community?


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Mr. Speaker, the official opposition has carried its opposition to this program, which will benefit thousands of Canadian home owners, into obstructive measures in the House of Commons. They are now carrying that opposition into the question period. If the member has questions he wants to direct in relation to the budget, and to use the question period for the purpose for which it was intended, I invite those questions.


Some hon. Members:: Hear, hear!


EFFECT ON INTEREST RATES
Mr. Ed Lumley (Stormont-Dundas):: Mr. Speaker, my question is to the Prime Minister. For over a year now the Prime Minister has promised lower interest rates. Can he tell the House what measures there are in the budget that will have the general effect of lowering interest rates throughout Canada, outside the small business development bonds?


Some hon. Members:: Oh, oh!


Hon. John C. Crosbie (Minister of Finance):: Mr. Speaker, while the whole thrust of the budget-


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order. While heckling has been part of our practice, I cannot understand how it is possible to start to heckle a person before they have begun to give a response.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: Mr. Speaker, the whole thrust of the budget is to create an environment in which interest rates can go down. That will be done by reducing the size of the government deficit and by reducing the government's financial requirements for next year by $1.75 billion, which will give more room to the private sector and ease the pressure on interest rates. I hope that the forecasts in our budget are more accurate than those made last year, when an inflation rate of 6.5 per cent was prophesied and it is now 9.2 per cent.


Edward C. Lumley: Mr. Speaker, I regret that the Prime Minister, who made the promise during the election campaign, could not

answer my question and had to defer it to the Minister of Finance. I will put my supplementary question to the Prime Minister. The Prime Minister has talked about helping special groups in our society. Outside of the minimum relief provided by the energy tax credit, what does the Prime Minister plan to do for the senior citizens of this country, particularly those living on fixed incomes?


John Carnell Crosbie: Mr. Speaker, the senior citizens of this country will be assisted by the energy tax credit, which will apply particularly to those who have an income of up to $21,380. They have been assisted by our spouses' allowance legislation, which was introduced in this House this fall to account for a Liberal gap. Senior citizens will also be assisted by the new veterans' allowance legislation that has been introduced, and further assisted by the fact that we will bring our economy back to a healthy state, which will have the effect of increasing the amount that they will get from the government generally.


Some hon. Members:: Hear, hear!


ALLEGED REVERSAL OF ELECTION CAMPAIGN PROMISES
Mr. Edward Broadbent (Oshawa):: Mr. Speaker, blarney is blarney whether or not it comes from Newfoundland. 1 would like to ask the Prime Minister a serious question.
During the recent election campaign, the Prime Minister promised to stimulate the economy, provide low interest rates and bring forward major tax cuts for the people of Canada. Considering that in last night's budget the government reversed itself completely on virtually every one of these promises by bringing forward a restrictive budget, by maintaining high interest rates, and by increasing taxes by some $3.5 billion for the people of Canada, would the Prime Minister explain to the House and to the people of Canada why, in a parliamentary democracy, after reversing himself so completely, he ought not go to the Governor General to seek dissolution in order to get a mandate from the people of Canada for this complete reversal of policies?


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Mr. Speaker, one can always tell when the Leader of the New Democratic Party intends to raise a question that he does not regard as serious, because he prefaces it by calling it a serious question. The Leader of the New Democratic Party should know that if he wishes to force an election upon the country, he will have to take it on his own shoulders and not seek shortcuts in the way he has suggested and as he has done in a number of other ways.


Some hon. Members:: Hear, hear!


John Edward Broadbent: Mr. Speaker, the Prime Minister will see from the amendments we intend to move today-when we will have all 27 members present-that we intend to be consistent, at least, with what we promised the people of Canada.
December 12, 1979

I should like to shift to the shifty Minister of Finance and ask him a question, Mr. Speaker. Will he confirm that out of a total of a $90 billion increase in oil revenues that is going to come as a result of last night's budget, less than 2 per cent will go to the energy bank, while some $73 billion will go to the multinational oil companies and the province of Alberta? If so, will he explain why Canadians from coast to coast are being gouged to provide such a small sum for an energy bank but are bankrolling the multinationals in the province of Alberta?
Elon. John C. Crosbie (Minister of Finance): Mr. Speaker, what a simplistic approach to problems the Leader of the New Democratic Party has! As the budget document shows, if there are certain oil and gas price increases which are outlined in the budget over the next four years, it shows how much of that will go to the provincial governments, how much to the industry and how much to the federal government. I think it is $17 billion to the federal government, $33 billion to industry and a larger figure to the provincial governments.
Of the amount that comes to the Government of Canada, all of the $17 billion will be spent on energy projects in Canada, conservation projects, home insulation programs, oil furnace retrofit programs, assistance to the Atlantic provinces because of their high dependence on oil-generated electricity, assistance for hydro projects like the Lower Churchill project in Newfoundland, assistance for gas pipelines like the gas pipeline to the maritime provinces, and assistance for projects that will help Canada and the people of Canada all over this country. That is what it will be used for.


Some hon. Members:: Hear, hear!


EQUALIZATION PAYMENTS TO ONTARIO RESULTING FROM BUDGET-LOSS OF JOBS
John Edward Broadbent: A final supplementary question, Mr. Speaker. It is still 2 per cent for the energy fund and $73 billion for the multinationals. The minister could try again, Mr. Speaker. Will he confirm the figure used by a cabinet minister in the Ontario government when he said last night that in 1980 alone, as a consequence of the oil price increases forced on the people of Canada by this government, Ontario will lose some 20,000 jobs? Will the Minister of Finance confirm that figure?
Will he also confirm that, as a result of the policy of oil price increases of this magnitude, hundreds of millions of dollars in the next few years will have to be paid out to the province of Ontario in equalization payments as a result of the unprecedented attack by this government on the industrial core of Canada?


John Carnell Crosbie: Mr. Speaker, 1 will not confirm anything of the sort. First, with reference to the industry and the $33 billion that they will get over a four-year period, they will invest that in tar sands plants costing $5 billion each, in heavy oil plants costing $4 billion or
Oral Questions
$5 billion. There are billions and billions of dollars of projects for them to invest those funds in. If they do not invest their funds in those projects, then we will review their activities. But we know that they will.
As for Ontario, I will confirm, Mr. Speaker, that Ontario will rise with stronger industrial plant and capacity than ever after the next two or three years as we go gradually up in oil and gas prices. We have pledged to Ontario that we are not going to exceed 85 per cent of the U.S. or international price, whichever is the lower. The official opposition was going to go to 100 per cent, but we are only going to go to 85 per cent in the interests of Ontario and the rest of Canada.


AGRICULTURE
Joseph Adrien Henri Lambert: Mr. Speaker, my question is directed to the hon. Minister of Agriculture.
According to our information, the Maple Lodge corporation of Toronto has requested and obtained an additional import permit of over 1,760,000 pounds of poultry for 1979. Could the Minister of Agriculture confirm this and advise the House whether he will continue to allow chicken imports permits to be issued by the Minister of Industry, Trade and Commerce?


Hon. John Wise (Minister of Agriculture):: Mr. Speaker, in response to the hon. member's question, it is true that some weeks ago an application was made by a particular processing firm for a supplementary permit. The Department of Industry, Trade and Commerce did contact the national agency. The national agency, in turn, contacted its provincial counterparts. They were able to secure about half the amount of product that that particular processing plant wanted from Canadian sources, and a supplementary permit was issued. However, since that time a number of applications have been received from that processor.
My colleague, the Minister of Industry, Trade and Commerce, and I have appointed a committee which is made up of a cross-section of the industry. We have said publicly that no further supplementary permits would be issued to any processor in Canada without the approval of that committee.


FLOODING OF QUEBEC MARKET WITH POULTRY- MEASURES TO BE TAKEN TO PROTECT PRODUCERS
Joseph Adrien Henri Lambert: Mr. Speaker, I rise on a supplementary. In allotting the quotas, a certain percentage was set for Ontario, another for Quebec and so on for the

Oral Questions
other parts of the country. In this regard, does the minister know that the Ontario company, Maple Lodge, has flooded the Quebec poultry market with part of the quota allotted to Ontario, so much so that it could lead to the withdrawal of Quebec from the Canadian Chicken Marketing Agency? In addition, could the minister take steps to protect Quebec producers who are on the brink of bankruptcy, which will result in financial difficulties for Quebec slaughterhouses?


John Wise: Mr. Speaker, I am aware that some of these comments have been made and, indeed, some of these charges. I am quite certain that the national board, which is made up of provincial counterparts, will be able to resolve this difficulty.


THE BUDGET
Hon. Jean Chretien (Saint-Maurice):: Mr. Speaker, I would like to ask a question of the Minister of Finance. Last night he indicated to the nation that his government will be satisfied with almost no growth in the economy next year. Consequently, there will be a big increase in unemployment in Canada. Will the Minister of Finance agree to follow what was suggested on April 18, 1978, by the hon. member for St. John's West when he said:
Any government that is not led by a man obsessed with unemployment in Canada today should resign and get out and let people take over who arc obsessed with unemployment.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: Mr. Speaker, it is because I am obsessed with unemployment that we are going to do everything we can to see that these projections do not come true. We are honest with the Canadian public. We are giving the Canadian public what our professional economists think is likely to happen next year. We are going to do everything we can to show that the professional economists are wrong in unemployment as well as in other directions.
I am not going to pretend that inflation is going to be 6.5 per cent, when it is going to be 9.2 per cent, or anything like that, as was done last year. Nor are we satisfied with no growth in the economy. We are expecting real growth of at least one per cent. If our efforts are right, we will have in excess of that despite the impediments that we are carrying on our backs from the past. A lot depends on what happens in the United States of America.
December 12, 1979


INQUIRY WHETHER ENERGY SELF-SUFFICIENCY TAX WILL BE LEVIED ONLY AFTER AGREEMENT WITH PROVINCES
Hon. Marc Lalonde (Outremont):: Mr. Speaker, in view of the commendable efforts of the Minister of Finance last night in the use of the language of Moliere, may I be allowed to ask him a question in French today? We are asked to approve this budget which contains a forecasted revenue from 1980 to 1984 of some $13 billion from the self-sufficiency in energy tax. Unfortunately, Mr. Speaker, nowhere is there any indication of how that tax will be levied, or what type of agreements will have to be reached with the provinces. At this time, there are no agreements.
So my question to the Minister of Finance is this: first, the budget indicates that additional increases in price in July 1980 will not become effective until such time as the new tax applies. Can the minister say whether he intends to apply this tax only after agreements have been reached with the producing provinces, or does he intend to apply it even if there are no agreements with the provinces? Will that tax be levied on corporate income, gross income, or profits, and does the minister intend to levy a 50 per cent tax, or less, on the surplus income of the companies? Finally, does the minister agree that by 1990 that tax will bring us to the point where we now stand, that is, the one explained by the Minister of Energy, Mines and Resources last Friday in the standing committee, where we will be importing 250,000 barrels of oil-


Mr. Speaker:: Order.


John Carnell Crosbie: Mr. Speaker, to answer the hon. member's question, I would have to read over the budget speech of last night and it would take me an hour and five minutes. The oil and gas price increases are going to be as set out in the budget. There will be an energy tax which will give us the revenues as set out in the budget. Whether that is to be a revenue tax or a profits tax has not yet finally been decided.
There will be such a tax. Without a tax there will be no such increases. We are going to take the amount of revenue that is shown in the budget and use that to help people all across Canada and help prepare Canada for self-sufficiency in energy. It was all laid out in the budget last night.


EXCISE TAX ON FARM FUELS-DETRIMENTAL EFFECT ON PRODUCERS
Mr. Robert Daudlin (Essex-Kent):: Mr. Speaker, my question is for the Minister of Finance. Given that the forecasts of the officials of the Department of Agriculture are for a drop in farm incomes over the next year of some 12 per cent, and that all producers' estimates find this optimistic in the extreme, given that those projections were made in advance of notice of the over 100 per cent increase in taxes on fuels to the farmer for land preparation, cultivation and harvesting of food, and

December 12, 1979

given the fact that some farm organization representatives are now estimating that this fuel input cost increase is likely to cost something in the order of $50 to $200 more per acre next year, does the minister not now agree-


Some hon. Members:: Order.


An hon. Member:: Come on.


Robert Mose Patrick Daudlin: -that the additional impact of the increased fuel costs as announced by the Minister of Finance last night is likely to result in an actual loss to the producers, by way of income, more closely approximating 16 per cent than the forecast 12 per cent, and that the rebate of 10 cents proposed by the minister is totally inadequate? Does he not agree that a blue Newfoundland herring drawn over and disguised as a tax concession is, in fact, a direct tax on the production of food and an indirect tax on all consumers in this country?


An hon. Member:: Right.


John Carnell Crosbie: Mr. Speaker, the hon. gentleman has very little faith in the farmers of Canada if he is going to take that defeatist attitude. Food is always needed. Canadian farmers can produce it. They are efficient producers, and to assist them the excise tax on gasoline is reduced by 10 cents in connection with farm operations, which will be a considerable boost to them.
In addition, we are assisting the farmers by removing the tax burden when they sell their farms at the end of their careers to help in their retirement. We are going to look after the interests of the farmers; the hon. gentleman does not need to worry about that. On a comparative basis, the farmers will be in good shape next year.


REASON FOR 15 CENTS A GALLON EXCISE TAX ON URBAN TRANSIT SYSTEMS
Mr. Pierre Deniger (Laprairie):: Mr. Speaker, my question is for the hon. Minister of Finance. In reply to one of my questions last November 23, the minister indicated that mass transit was a subject dear to his heart, and last night he urged Canadians to cut their consumption of oil products. Can the minister tell the House and the Canadian people why he is imposing a 1 5 cents a gallon excise tax on urban public transit and thereby taxing the users of this type of service?


John Carnell Crosbie: Mr. Speaker, the government is levying an excise tax on urban transit systems which is 10 cents less than on the other sectors in the country-with the exception of farmers and fishermen-to encourage the use of mass transit. In addition, the energy bank which is to be funded from the new energy tax and other energy revenues coming from the energy tax will be used to help assist the development of urban transit systems throughout Canada on the basis that this is a conservation move. So
Oral Questions
there will be more good news for urban transit systems in Canada in the next 12 months.


NATIONAL SECURITY
Mr. Tom Cossitt (Leeds-Grenville):: Mr. Speaker, I have a question for the Prime Minister concerning recent statements attributed to him by the news media in regard to the release of the so-called Taschereau papers.
Is the Prime Minister now in a position to tell the House approximately when, or if, the papers will be released and whether there was really any legitimate statutory power for the former government not to release them after 30 years? Finally, was the non-release decision made in any way, according to investigations so far, to protect the interests of former Liberal governments?


Charles Joseph Clark: Mr. Speaker, the comment that was attributed to me after a press conference in relation to those files followed a question put to me concerning two files, the Featherbed file and the Taschereau file. I indicated in relation to the Featherbed file that in our judgment it contained primarily gossip and was not a matter to which we intended to give credence by publication.
The question of the Taschereau file is still under consideration. We are looking at a way by which we can have a respected and independent review of the contents of the Taschereau file prior to coming to a decision on whether or not it should be published.


THE BUDGET
Mr. Bob Rae (Broadview-Greenwood):: Mr. Speaker, my question is for the Minister of Finance. 1 would like him to confirm that the tax increases which were announced last night-over $3.5 billion in personal taxes alone-were the highest tax increases since World War II, and that the effect on the average family will be somewhere between $260 and $480 a year, net, depending on whether one spouse or both spouses are working.
How can the minister square that tax increase with the promise that he and the Prime Minister took to the Canadian people before May 22, that there was going to be a significant reduction in taxes in the first Conservative budget in 17 years?


Some hon. Members:: Hear, hear!


John Carnell Crosbie: Mr. Speaker, I can confirm that this budget and associated measures contain

December 12, 1979
Oral Questions
a significant tax reduction for the people of Canada: $1.2 billion for 1980, which hon. gentlemen opposite are trying to stop, a mortgage interest and property tax deduction, another $1 billion in 1981 under the energy tax credit, and $1.4 billion in connection with the index of the income tax.
That is what I can confirm, that every consideration has been given to the Canadian taxpayer, but that we need to have a drive toward conservation and energy self-sufficiency, which is another part of the budget and which the people of Canada are responding to very positively.


Some hon. Members:: Hear, hear!


Bob Rae: Mr. Speaker, it is clear that this budget should be subtitled "New Adventures in Mathematics''. I have a supplementary question to the Minister of Finance. In view of his statement last night that the creation of new jobs and new employment was essential, can he explain to us as well as he explained in his first answer how it is that the government saw fit to increase the cost of unemployment insurance premiums by $800 million at the same time as they are saying they want to increase employment. How does that increase jibe-to use a Newfoundland expression-with the intention of the government to create new jobs?


John Carnell Crosbie: Mr. Speaker, 1 am glad that the hon. member accepted my answer to his first question and did not follow it up with a supplementary. As far as jobs are concerned, if the hon. gentleman looks at the budget he will see that the new employment tax credit program is going to create 100,000 jobs; that we are going to spend, in tax expenditures, $150 million more than the official opposition did last year; that we also have a special fund of $50 million for employment creation projects in eastern Canada, Quebec and the Atlantic provinces; and that this whole budget is replete with job-creation through our assistance to small business corporations by making the salaries of spouses deductible in small, unincorporated businesses.
There are 400,000 unincorporated businesses across Canada which can benefit from that, and 300,000 small business corporations from our small business development fund. On and on it goes, a budget of job-creation and reaching toward our potential.


Some hon. Members:: Hear, hear!


ADDITIONAL EXPORTS OF NATURAL GAS TO UNITED STATES- COST OF REPLACEMENT FROM FRONTIER AREAS
Mr. Paul E. McRae (Thunder Bay-Atikokan):: Mr. Speaker, my question is to the Minister of Finance. The centre-piece that he announced last night in the budget-at least, the current account showpiece-is the 3.8 trillion cubic feet of gas to be exported to the United States which will bring $15.5 billion according to the minister.
Since the Minister of Energy, Mines and Resources admitted last week that conventional supplies of gas would run out, or at least demand would exceed supply in 17 years, can the

minister give me an estimate of the cost to the next generation of Canadians of replacing this gas from frontier areas which would be far more expensive than what we are selling it at now?


John Carnell Crosbie: Mr. Speaker, 1 can give the hon. gentleman this assurance, that the next generation of Canadians will be freezing in the dark if we do not take the steps we are taking now for energy self-sufficiency-in Canada.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: In connection with the export of gas, that has been approved by the National Energy Board, an independent agency whose members were appointed by the last government

all of them-and who have reached the conclusion after studying this area that we have this surplus that can be exported. Unless we export this surplus gas, we will not have any exploration and development of other sources that is going to go on year after year well into the twenty-first century. So the hon. gentleman does not need to worry: we are looking after the next generation, unlike his government which did not do it.


Some hon. Members:: Hear, hear!


INCREASE IN PRICE OF OIL-DETRIMENTAL EFFECT ON FOOD PRICES
Miss Aideen Nicholson (Trinity):: Mr. Speaker, my question is for the Minister of Finance. In view of the fact that even before last night's brutal budget, spokesmen for the food industry and for consumers at a conference sponsored by Agriculture Canada yesterday were predicting an increase in food prices of at least 15 per cent in 1980 because of transportation and energy costs and high interest rates-a figure which will quickly become even higher as a result of last night's oil price hike-and in view of the fact that the chairman of metro Toronto has been quoted today as saying that it will be necessary to raise property taxes in metro because of the oil price hike, will the minister tell the House how he justifies taking billions of dollars aw'ay from consumers while failing to use it to finance energy-saving measures?


John Carnell Crosbie: Mr. Speaker, one of the important influences on food prices is the state of the Canadian dollar. Hon. members opposite have been complaining because steps have been taken to try to maintain the Canadian dollar around its present level so that the food and other goods which we import will not increase in price because of the price of our dollar compared to that of the United States, from which we import much of our food. That is one of our concerns. We are very concerned about the situation. It is the government's energy policy and its drive toward conservation and energy saving that is going to result in improvements in food prices in the future. There has to be some short-term pain for long-term gain; that is the way we have to look at it.
December 12, 1979


EXPENDITURES BY TREASURY BOARD AS A RESULT OF THE BUDGET
Hon. Robert K. Andras (Thunder Bay-Nipigon):: Mr. Speaker, my question is for the President of the Treasury Board, who has revelled in his new nickname, "the slasher", which he thought he earned stemming from his bravado about indiscriminate cutting of people and expenses.


Allan Joseph MacEachen: He slashed himself in committee: the "self-slasher."


Robert Knight Andras: Since the disclosure last night it is evident that he has accepted expenditure increases of 10 per cent per year, greater than in the past three years; expenditure increases from $48 billion to $78 billion in five years, an increase of 60 per cent in those five years; and since in the expose-and that is what it is-the so-called cash deficit reduction stems, not from expenditure restraint but from increased taxes and an accidental accrual of pension funds, how can the President of the Treasury Board accept the total loss of his credibility, and what is left for him to slash but his own throat?


Some hon. Members:: Hear, hear!


Hon. Sinclair Stevens (President of Treasury Board):: Mr. Speaker, I would suggest to the hon. member that if he has a knife available, he had better start slashing his own throat after 1 give him the answer. I cannot get over the gall of the hon. member in standing up and asking that question. He seems not to have read the budget of last night, which made it clear that there is a negative real growth in expenditure after inflation in the figures revealed by my colleague, the Minister of Finance.
Certainly, even the hon. member must know that, based on the figures we revealed last July-which were simply their figures-the figures released last night indicate we are going to narrow the deficit in Canada between now and fiscal 1983 by over $17 billion.


Some hon. Members:: Hear, hear!


Joseph Jacques Jean Chrétien: Raising taxes.


Sinclair McKnight Stevens: I think the former president of the treasury board and the immediate past president of the treasury board should get up and apologize to this House for not supporting-


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


DEFICIT FORECAST IN BUDGET
Mr. Arthur Phillips (Vancouver Centre):: Mr. Speaker, I would like to ask my question of the Prime Minister, because earlier the Prime Minister said that one of the main objectives of this budget was to slash the deficit. The hon. minister who just spoke named some figures regarding slashing the deficit,
Oral Questions
and the people of Canada are being asked to make considerable sacrifices to this end.
My question is a very simple one: Why is it that in the government's own figures, at page 21, the deficit is shown- that is, the excess of expenditures over revenues-as droppping only from $11 billion in the current year to $9 billion five years from now?


John Carnell Crosbie: Mr. Speaker, if hon. gentlemen will be patient, the reason is this: that is a tremendous decrease, in view of the anticipated inflation, in view of the tremendous interest cost expenses which we cannot control, the $1.7 billion increase in interest expenses-due to the profligacy of the last government-that we are going to have next year in our budget, and in view of the fact that it takes two or three years to get that under control. This is going to be a magnificent achievement. With financial requirements reduced from $10 billion to $4.5 billion in the same time-period, that is a tremendous achievement.


EXCISE TAX ON FARM FUELS-COST TO FARMERS
Lorne Edmund Nystrom: Mr. Speaker, my question also goes to the excited Minister of Finance. In view of the fact that last night the minister increased the price of fuel for farmers by some 15 cents a gallon and that there will be a future increase of $4 per barrel coming in 1980- and this is on top of interest rate increases all year long-I would like to ask the minister whether he can tell the House how many hundreds of millions of dollars increase in tax this will mean for farmers. Does he have those figures for the House today?
Second, while he is on his feet, can he tell us why he will not rebate this increase to farmers, since fuel is a necessity, not a luxury, in the production of food?


John Carnell Crosbie: Mr. Speaker, I have never yet seen an NDP member who could excite me.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: With one exception, Mr. Speaker.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: 1 think the hon. member should look on the positive side. With this impetus to conservation, we are going to save the importation of 100 million barrels of oil by 1985. We are going to save $2.5 billion of current prices in our deficit and our current account. That is going to help the farmers of Canada; that is going to help all the people of Canada; that is going to give them a future; and that is going to make us a strong country. That is what he should remember.


CONCERN OF FISHERIES COUNCIL OVER INCREASE IN EXCISE TAX ON FUEL
Mr. Roger Simmons (Burin-St. George's):: Mr. Speaker, I have a question for my good friend from Newfoundland, now

December 12, 1979
Oral Questions
that he is in the process of opening his mouth and changing feet. In view of the budget announcement of an increase in the excise tax on fuel to 25 cents a gallon, with the 10-cent rebate to primary producers, and in view of the statement of the Fisheries Council today that this increase raises serious questions about our competitiveness in the export Fish market, can the minister confirm that the net increase of 15 cents a gallon, first of all, applies to all fishermen, both salt water and inland, and to all farmers; and, second, does the minister share the expressed concern of the Fisheries Council?


John Carnell Crosbie: Mr. Speaker, I want to congratulate the hon. member for Burin-St. George's on his election to the House.


An hon. Member:: You elected him.


John Carnell Crosbie: It is true that his provincial district of Hermitage is now PC, so it was a good move.


An hon. Member:: What happened to Carter?


John Carnell Crosbie: With reference to the hon. member's question, the Fishing industry in Canada is in a very healthy state. The main market is in the United States of America. Energy prices in the United States of America have increased far more swiftly than ours, and are going to continue to do so. We are going to keep our fuel costs well below those in the United States of America.
Although costs for the fishing industry and all other industries are going to be increased, they will still be very reasonable, from an energy point of view, compared with any other of the western industrialized countries, particularly in Europe and the United States. If the fishermen carry on with their usual efficiency and enthusiasm, there is no reason for them to worry at all-in addition to which we are giving them assistance. We are making it attractive for investors to invest in fishing vessels of sizes from 40 feet to trawlers, the long-liners. We are doing quite a bit to assist them in that direction.


INVESTMENT IN SMALL BUSINESS-NO TAX SHELTER IN BUDGET
Mr. Roy MacLaren (Etobicoke North):: Mr. Speaker, my question is for the Minister of Finance. The government's decision to allow Canadians investing in Canadian companies listed on Canadian stock exchanges a $20,000 tax shelter next year does not extend to investments in small businesses. Will the government indicate why this new opportunity is limited to investors in large corporations and is not afforded to investors in smaller businesses? What has become of the Prime Minister's promise of last year to allow a tax credit for capital investments in small businesses?


John Carnell Crosbie: Mr. Speaker, the plan to which the hon. gentleman refers is one which will apply to publicly-traded companies on Canadian stock exchanges. For technical reasons, it is impossible to include in that plan companies which do not trade. But there are stock

exchanges today which can handle companies in the trading of shares of no great size in the ordinary term, so that this will apply to a great many companies.
In addition, the small business sector will get the tremendous advantage-the incorporated small business sector-of the small business development bond after-tax financing. They will be able to cut their interest costs during 1980 very, very considerably. That is a tremendous incentive and boost to them. In the unincorporated area of small business, they will be able to deduct the salaries of their spouses, at a cost of $150 million. That is a tremendous boost to small business in all sectors, publicly-traded, incorporated and unincorporated.


Some hon. Members:: Hear, hear!


INCOME DEBENTURE FINANCING
Mr. Donald J. Johnston (Saint-Henri-Westmount):: I have a supplementary question, Mr. Speaker. The Minister of Finance fails to point out that the very measure of which he is so proud is simply a recycling and a retread of an idea which was eliminated in Bill C-17, namely, income debenture financing. As far as the spousal allowance is concerned, he fails to point out that the recipients-


Mr. Speaker:: Order, please. Does the hon. member wish to put a question?


Donald James Johnston: My question is to the Prime Minister in order to elicit a serious response. Why is there this patent discrimination in this budget against the small business sector, where no provision is made to attract equity capital into that sector at this time? Only in the case of listed corporations are these provisions available.


John Carnell Crosbie: Mr. Speaker, in Bill C-17 we were dealing with a problem of the previous government, where they let the giant corporations-the Petro-Canadas, the billion dollar outfits-get the beneFit of after-tax financing. That loophole has now been stopped and we are giving that benefit where it should have been given in the first place-to the small business sector. That is our approach-not the approach of the monopoly capitalists opposite.


Some hon. Members:: Hear, hear!


FINANCIAL SUPPORT FOR NATIONAL ORGANIZATIONS
Mr. Louis R. Desmarais (Dollard):: Mr. Speaker, my question is for the Minister of State for Fitness and Amateur Sport.
December 12, 1979

Would the minister tell the House what precautions he took to ensure that our national sports organizations which were supported by Loto Canada will continue to receive support after the disappearance of Loto Canada? Also, what level of support can they expect to receive in 1980 as opposed to what they received in 1979?


Hon. Steven E. Paproski (Minister of State for Fitness and Amateur Sport and Multiculturalism):: I have a question today. I should like to take this opportunity to thank the hon. member for his question.
I would like the hon. member to know, through you, Mr. Speaker, that after the wind-down of Loto Canada, as of December 31 there will be $12 million coming from the provinces from the wind-down, the full amount of which fitness and amateur sport will be getting, which means they will be receiving three or four times as much money as they have in the past three or four years. In the past, we have been averaging about $2.7 million, although we were promised at least $6 million annually from the lotteries. Now we will be receiving half of the $24 million which we negotiated, in 1979 dollars, connected with CPI.


THE BUDGET
Mr. Bob Ogle (Saskatoon East):: Mr. Speaker, I have a question for the Minister of Finance. The minister is forecasting an 11 per cent inflation rate next year, yet the government has adopted a 10 per cent ceiling on all government expenditures. Since this will mean a $500 million cutback, can the minister indicate to the House what specific programs will be cut, and can he give us an unequivocal assurance that there will be no further cutbacks on health and social programs which are already being eroded by previous government decisions?


John Carnell Crosbie: Mr. Speaker, the hon. gentleman's question points up the fact that we are tightening expenditures and that under the regime of my friend next to me, the President of the Treasury Board, through his fierce efforts a considerable amount of money will be eliminated from the budget which was previously wasted on cost overruns and the like.
I can also reassure the hon. gentleman that we are not planning any cutbacks in the health or social services. There will be a review to see whether funds can be better directed to those who need them most, not necessarily on a universal basis. This will be studied. It is one of the things we intend to do to better direct the funds. But as for cutbacks, there will be none.
Privilege-Mr. Chretien


Robert Joseph Ogle: Mr. Speaker, I should like to direct my supplementary question to the Minister of National Health and Welfare. Since the minister is not a member of the inner cabinet, can he find out from the Prime Minister what programs of his department, if any, will be affected by last night's budget; and will he inform the House and the Canadian people whether senior citizens and low income people will be further cut from government programs ?


An hon. Member:: He has not been told yet.


Some hon. Members:: Oh, oh!


Hon. David Crombie (Minister of National Health and Welfare):: Mr. Speaker, I can assure the hon. member that there is absolutely nothing in the budget of last night-


Some hon. Members:: Hear, hear!


An hon. Member:: You won't even be in the outer cabinet from now on.


David Edward Crombie: Mr. Speaker, it is obvious that members opposite have so little to occupy their minds that they would halt me in the middle of a sentence. I can assure the hon. member and all members of the House that nothing in the budget of last night will adversely affect any health program or, indeed, any social service program. Also, I would like to remind the hon. member that the reviews now being carried out-which we have talked about in the House previously- will continue to be carried out through 1980. Indeed, the way we have approached it so far is to look for ways in which we, as the Minister of Finance has indicated, will be able to provide funds for those most in need.
I am sure the hon. member has already had an opportunity to read the report which has come from the National Council on Welfare entitled "In the Best Interests of the Child". On a number of occasions in the House 1 have indicated the importance of making sure there is sufficient income for low and moderate-income people. This report gives support to that kind of review, and I thank the hon. member for the question.


PRIVILEGE
Joseph Jacques Jean Chrétien: Mr. Speaker, I rise on the question of privilege I raised last night after the budget speech. The confidentiality in which the details of a budget are kept is a constitutional practice which forms an integral part of a parliamentary system. Such practice is based on the principle that no individual, whoever he may be, must know in advance the details of a budget which he could use for personal gain.

December 12, 1979
Privilege-Mr. Chretien
On July 24, 1975, the hon. member for York-Simcoe, now the President of the Treasury Board (Mr. Stevens), stated, and 1 quote:

Ministers deliver their budget speeches, and any amendments that the minister may think fit thereafter, in a spirit of confidentiality. For example, budget speeches themselves are usually delivered in the evening to avoid any possible effect on the stock market. The tradition of secrecy ensures that all Canadians will enjoy the same advantage or disadvantage with respect to any budgetary matter, and that any announcement will be made first in the House and not privately to those who rightfully have no access and should have no access to that information. 1 suggest that budget secrecy is essential to guarantee to all taxpayers that no group can escape its share of taxation, and that in particular those whom they have elected to the House of Commons cannot escape laws approved for everybody . .. The point is not only a question of budgetary secrecy, but also the importance of keeping any tax change also secret, and 1 would suggest that the two are really one and the same.
All the ministers of finance have been critical of the fact that this tradition was creating some problems for them in carrying on the normal consultations which they wanted to have with either the provincial government, the business community, economists, and so on. Ministers of finance have always been extremely careful about their actions in that field. Of course there are some precedents that are well estabished for this long-standing British tradition, to the effect that ministers of finance must keep budgetary information very close to the chest. This is something that 1 and all my predecessors were very careful about. I do not want to recite all the precedents, but there are two well-known cases in England where ministers casually revealed some budget information or someone around them did so, such as Hugh Dalton, a former chancellor of the exchequor, who had to resign as a result.
In Canada in 1975 there was a member of the House, namely, the hon. member for Kenora-Rainy River (Mr. Reid), who was accused by the then opposition of leaking some budget information, which he denied. Despite his denial, the House ruled that he had to justify himself in front of a committee. He went before a committee of the House and explained the matter, following which it was proven that he had done absolutely nothing wrong and no leak had taken place. Nevertheless, members of the House, and especially members who are in the government today, cast innuendoes and accusations of all sorts so that for many weeks thereafter the hon. member for Kenora-Rainy River was subjected to them. He had to go before the courts to clear his name in the minds of the Canadian public.
On Monday night, on the CTV national news, the Ottawa bureau chief, Craig Oliver, who is one of the senior men in the gallery and a very respected reporter who would not have made this information public had he not been completely sure of his sources, said the following:
The finance minister's budget will be hitting hard at major corporations in Canada. They face an increase of five points in their corporate tax rates from 46 to 51 per cent. The government is expected to raise one and a half billion dollars with the measures, which sources say will be the highest corporate tax rates in years. To sweeten the pill they will receive some tax breaks.
But for individuals, there are no tax increases in the budget. However, there are no cuts either. To help with the increase in the costs of energy for low income
(Mr. Chretien.1
Canadians, Ottawa will offer an energy tax credit of $80, to those whose income is less than $18,000 per year. If there are two of you in the house, you can both claim, and it doesn't matter whether you live in a single family dwelling in a highrise or whether you rent. The measure will cost Ottawa $1 billion. The budget will be heavily energy-orientated in other ways too-it will increase the assistance to and expand the home insulation program. To raise a lot of the revenues the government requires for the budget measures, Mr. Crosbie will impose a 25-cent transportation fuel excise tax-it will be registered on Canadian gas pumps Wednesday morning.
This is very close to what was in the budget. Today the press reports all over Canada that there were last night line-ups at the gas pumps because of it. The fact that he was very close to the real thing-


Allan Joseph MacEachen: He was dead on in some places.


Joseph Jacques Jean Chrétien: Of course it is very obvious it was someone who spoke-who did not deliver a document, but spoke to him, or through him, to another person.
It is nothing personal which I have against the Minister of Finance (Mr. Crosbie). But I have to tell the House that I have been the minister of finance myself. I went through an extremely difficult consultation with the provinces where some members of the opposition accused me, because I could not be as candid as I wanted, of being a dictator. That was because I was doing something with the provinces for the first time in the budgetary process in Canada. 1 was trying to involve the provincial governments. In spite of that, I took all the necessary measures to make sure that there was no leak. That gave me extreme difficulties in this House and outside, but I always kept in mind the responsibility which 1 had in terms of budget secrecy.
There were some stories in the press that it was the first time in history this budget was kind of a "strip tease", because we had bits and pieces-everything out-until yesterday we realized that there was absolutely nothing new when we sat in the House for more than an hour. Everyone knew, one way or another, what would be in this budget.
It is pretty ironic that I would be standing in my place defending the best British traditions. I am sure Mr. Diefen-baker would be very proud of me standing to defend the British tradition and asking the Minister of Finance to take his responsibility. Of course it is extremely difficult, and I have a lot of sympathy for the minister. He is forced to conduct those consultations in order to have a budget document prepared. Sometimes he has to consult with the department and so on. He has the responsibility of making sure that there is absolutely no leak.
With what 1 read to Mr. Speaker today, and with what has been said in the House over the last few days, I have no choice but to raise this problem. The oil companies have jumped the gun on the government by increasing the price of oil and gasoline in the last few days. There was a fantastic indiscretion by the Prime Minister (Mr. Clark) a few weeks ago, when he said to the House that he was to consult the industry before increasing its taxes. We see that he has done just that, because
December 12, 1979

the industry was able to jump the gun and increase the price of gasoline last week.
1 have absolutely no choice but to raise this fundamental problem of parliamentary democracy. When we have a government that is responsible to this House, the Minister of Finance has to take all the necesary steps to ensure that there is absolutely no leak. I realize that a pair of mukluks is more leaky than a pair of shoes. Also I realize that the hon. minister has no choice but to reveal to the House what happened. In order to help him to clarify the question of whether there was a leak-and 1 think there was a leak-in my judgment he will have to take his responsibility in the best British tradition.
Therefore, I move, seconded by the hon. member for Keno-ra-Rainy River (Mr. Reid):
That the Standing Committee on Privileges and Elections be instructed to investigate the advance knowledge by journalists and others of measures to be proposed in the budget, including proposed changes in corporate and commodity taxes, in advance of the delivery of the budget; and that the committee report its findings no later than December 31, 1979, and in the absence of a final report, make an interim report by that date.


Some hon. Members:: Hear, hear!


John Carnell Crosbie: Mr. Speaker, the hon. member is really straining with this motion. First 1 will submit to Your Honour that there is no question of privilege whatsoever.


Walter David Baker: Precisely.


John Carnell Crosbie: But just let me say on a factual basis that there has been no budget leak. There was certainly no budget leak for which I am responsible. There was no budget leak from the Department of Finance. There was no leak, period.
Everyone in the country has known for some months that the Government of Canada is involved in negotiations with the provinces over the energy situation. It has been known in public documents tabled at the first ministers' conference and given to the government of Saskatchewan, the government of Alberta, and to the government of British Columbia. It was known to dozens of officials in the government that there were being contemplated energy price increases and an excise tax. They were given to the government of Ontario, every government in Canada. They were filed at the first ministers' conference.
It was widely known that there was likely to be an energy tax, and there was speculation to that effect. Some speculators said that it would be 30 cents, some said that it would be 20 cents, some said that it would be 25 cents. In actual fact it was 17 cents.


Marc Lalonde: You are not even right. It is 18 cents.


John Carnell Crosbie: If we look at the report of Mr. Craig Oliver of Monday, December 10, Mr. Oliver was guessing like everybody else. He guessed the 25 cents, and he guessed wrong because the increase to the personal consumer is not 25 cents; it is 17 cents.


Walter David Baker: It is 18 cents.
Privilege-Mr. Chretien


John Carnell Crosbie: I am sorry, 18 cents.


Some hon. Members:: Oh, oh!


John Carnell Crosbie: When we look at this broadcast again, what do we see? Mr. Craig Oliver said that the rise in corporate income tax "will be a heavy blow to major corporations; they face a jump of a full five points from the present income tax rate of 46 per cent to 51 per cent; government insiders say the increase will raise as much as $2 billion." That is completely inaccurate. There is no accuracy to it at all. It is not correct- incorrect to the last degree. The increase of 5 per cent is in corporate surtax, Mr. Speaker. The 5 per cent corporate surtax will raise $370 million in the year to come. That is not even near $2 billion. It is really stretching the point. There was no increase in the corporate tax rate at all. So much for that allegation!
Then Mr. Oliver went on to say or to guess that there would be an energy tax credit. The possibility of an energy tax credit was discussed with all the governments that I have mentioned. They were aware of the fact that there might be an energy tax credit. Mr. Oliver suggested that there would be some incentives, that low income families would get assistance. He said that any Canadian whose income is less than $18,000 a year would receive a flat energy tax credit of $80. That is not accurate at all. It is every Canadian who has an income of up to $21,380 a year. So, on and on it goes.
Let us look at the rest of his report. He said that in the budget we would beef up grants for home insulation programs. That was not done in the budget. He said that we would offer generous tax incentives to convert furnaces from oil to natural gas. That is not in the budget.


An hon. Member:: You should have done it.


John Carnell Crosbie: On and on it goes. There was no leak in the budget secrecy process. But let me say that we are trying to open up the budgetary process. There is quite a difference between a budget leak which could give people a chance to make a large amount of money on the stock market or whatever, if they had inside knowledge, and some speculation that there will be an excise tax increase or not an excise tax increase, or whatever. So this is just in the realm of speculation.
In addition the Prime Minister (Mr. Clark) yesterday, when asked a question in the House, denied that there was any budget leak. He denied the fact that there was any budget leak.


An hon. Member:: How does he know?


John Carnell Crosbie: This broadcast was made on Monday evening. That denial has not been accepted by the hon. member for Saint-Maurice (Mr. Chretien) who should know better.
I should like to refer to a statement made by Your Honour on April 17, 1978, where you ruled on a matter which involved the hon. member for Saint-Maurice. It was alleged that there had been leaks in connection with certain sales tax proposals. I

December 12, 1979
Privilege-Mr. Chretien
do not like to mention this as it is a very painful experience for the hon. member for Saint-Maurice. He was trimmed, pounced on, trounced on and jounced on by the government of Quebec because of these sales tax proposals last year. Before the budget was brought down there was a story in the Toronto Star which indicated there were going to be these sales tax proposals in the budget. The actual sales tax proposals were outlined in the Toronto Star. This was also done on CTV national news on April 9. There were also allegations that the CTV had said there were going to be changes to research and development benefits for corporations. They had revealed that before the budget. The minister was very, very injured by the fact that allegations of leaks had been made against him.
Your Honour dealt with the matter on April 17. You pointed out that the minister had made it clear that there was ample room for speculation with respect to research and development benefits as this subject had been discussed at a recent first ministers' conference. That is right on, and a wonderful precedent in relation to the matter he is bringing up here this afternoon. His excuse last year was that research and development benefits had been discussed at a first ministers' conference. The whole House knows that energy taxes and energy tax credits, and the whole business, have been discussed at first ministers' conferences. Your Honour then went on to say:
In addition to those, it seems to me that the matter has been disposed of in a complete way, as far as this House is concerned, by the minister's explanation that he was not able to discover and did not take any responsibility in any way for any leak of budgetary information.
I say that I am not able to discover and I do not take any responsibility in any way for any leak of budgetary information, and in fact there was no leak, so certainly 1 am not going to take the responsibility.
Then Your Honour went on to say:
-I must express some serious doubt whether the conventional budgetary secrecy falls within the area of privilege at all.
You dismissed the whole allegation and the fact that it could have been a breach of privilege last year. The member has cited nothing to indicate any leak of budgetary secrecy. There was no leak, Mr. Speaker. There was scuttlebutt and there was speculation, as there always is when a budget is coming forward. Naturally people last night went to fill up their cars before the budget came down because they had heard so much speculation about an excise tax increase. The only one who did not was myself. I did not dare go and do it, but everybody else in the country who had any sense did.
So, Mr. Speaker, as far as mukluks are concerned, the hon. member is in the muck without any luck.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Order, please. The motion that has been put forward is to be seconded by the hon. member for Kenora-Rai-ny River (Mr. Reid). I am going to permit the hon. member a brief intervention, but I must point out to the House that there

is no allegation in the motion of any misconduct on the part of the minister or on the part of any other member. The motion and precedents to which I have referred, and to which the Minister of Finance (Mr. Crosbie) has referred, it would seem to me, ought to lay the matter to rest. However, I am prepared to hear briefly from the hon. member for Kenora-Rainy River since he is named as the seconder of the motion.


Mr. John M. Reid (Kenora-Rainy River):: Mr. Speaker, 1 would like to refresh your memory as to the precedents on this going back to 1975. Your Honour may recall that you were in the chair and at that point 1 was accused of having released budgetary information illegally. There was an investigation by the Committee on Privileges and Elections as a result of a decision subsequently taken by the House and after Your Honour had made a decision that, indeed, there was a prima facie case of privilege involved. I do not want to go into the details of that experience, but I do want to indicate-


Mr. Speaker:: Order, please. I think the hon. member should realize that this is the point 1 have just made. That motion made an allegation directly against the hon. member for Kenora-Rainy River. This motion makes no allegation against the actions of any member of the House of Commons. That is the fundamental difference.


John Mercer Reid: Mr. Speaker, it seems to me that the motion says there have been budget leaks. Your Honour said in 1975 that the question of budgetary secrecy was one of the great constitutional conventions of our system, and that anything that broke that obviously put the people who had done that in contravention of our constitution.
It seems to me the fact that this is mentioned, with some evidence by the hon. member, is an allegation that the privileges of myself, the hon. member for Saint-Maurice (Mr. Chretien), and other members of the House of Commons, have been breached.
I think we could have an argument as to whether in point of fact budgetary leaks did take place as alleged by the hon. member for Saint-Maurice, but that would be the job of the standing committee to decide. What is important is the fact that the hon. member for Saint-Maurice has brought forward some evidence to indicate that, indeed, a great deal about the budget was well known before the budget was presented to the House of Commons.
I am prepared to agree with the Minister of Finance (Mr. Crosbie) and also with the hon. member for Saint-Maurice that the budgetary procedures that we go through in this House may, indeed, be obsolete. It may well be that with the kind of mixture of financial considerations by the federal and provincial governments we must have more negotiations taking place at public meetings between the two levels of government. I accept that, but the point is that if the Minister of Finance is going to change the rules in midstream, he ought at least to let the House of Commons know. He did not do that, and we feel that he has in fact changed the rules in midstream. Had he told us, we probably would not be raising this point of order.
December 12, 1979

There is no question, if you take the transcript of what was given by Mr. Oliver on CTV news on December 10, that you will find that he was more right in his discussion of what was going to be in the budget than was the Minister of Finance, in his rebuttal. Let me give you a couple of examples.
The Minister of Finance said that Mr. Oliver was wrong in his discussion of the increased taxes on corporations. Mr. Oliver said there was going to be an increase of five points in the corporate tax rates from 46 per cent to 51 per cent. The 5 per cent figure was correct. What Mr. Oliver got wrong was not that there was going to be an increase in the tax rate, but that it was going to be a surtax. The total amount of revenue to be raised over the life of that tax he said was going to be $1 billion, not the figure given by the Minister of Finance which was for one year. I would suggest in that case that the Minister of Finance has misled the House.


Some hon. Members:: Oh, oh!


An hon. Member:: Withdraw.


John Mercer Reid: I think if you go on to the other point that the Minister of Finance dwelt a great deal upon, it was that Mr. Oliver's statement was that the excise tax would be a 25-cent one, when it was only going to be 18. Let us read what Mr. Oliver actually said:
-Mr. Crosbie will impose a twenty-five cent transportation fuel excise tax-
What is the value of that tax, Mr. Speaker? It is 25 cents. He has raised it from seven cents to 25 cents, and that is what Mr. Oliver said.
I think when you look at what is there and you take a look at the evidence, you will have to decide that Mr. Oliver had more accurate information than in respect of previous budgets we have had, particularly if Your Honour goes back and looks at other points in time when allegations of the same sort were raised against ministers of finance. Those allegations, after those budgets came down, were never seen to be as accurate as these particular allegations were in this specific case. It is for that reason we feel there is a question of privilege.
We think also that if Your Honour finds there is a prima facie case of privilege we should also have the reference expanded in order that we could look into the question of budgetary secrecy.
I agree with the Minister of Finance and the former minister of finance in thinking that the system we have entraps us into a situation where often we have to go the hard route of raising these matters on a question of privilege, and there ought to be other ways of resolving the difficulty. Successive ministers of finance have argued that there, indeed, is a real problem in terms of this matter, and we agree that it should be cleared up.


Mr. Speaker:: Order, please. The House will understand, of course, that 1 am faced with an intervention by the hon. Minister of Finance (Mr. Crosbie) in which he has directly and categorically denied that there was any leak for which he assumes responsibility.
Privilege-Mr. Chretien
The House has several traditions, one of which is related to budgetary secrecy. The House also has the very firm and very strong tradition that it always accepts the word of any member given in debate in this House. When the Minister of Finance at any time stands in his place and says, as he has said today, that there is no leak, that he has examined and attempted to discover whether there was and finds none, and therefore does not take responsibility for one and, furthermore, disputes the fact that one in fact took place, that word must be accepted. Therefore, I am not able now to take action which would amount to a contradiction of that word unless, of course, there is a proposal by the House to directly contradict the word of the Minister of Finance in the debate today by accusing him, or someone else, specifically of taking responsibility, or failing in their responsibility, to safeguard budgetary secrecy. That allegation has not been made in this motion, and if there is any basis for such an allegation it will have to be made specifically.
There is a very clear rule which was enunciated by one of my most distinguished predecessors, former Speaker Michen-er, that to accuse a member of this House of misconduct in any way, and to expect that that accusation can be sent to the Standing Committee on Privileges and Elections for investigation and examination, the allegation of misconduct by a member will have to be clear. The minister has stood in his place and denied that he is responsible for any leak and wishes to argue, as he has said, that there is not in fact any leak at all. On the face of that, I have to set aside the question of privilege, after having permitted, 1 think, ample contribution by the mover and the seconder of the motion.
I cannot find on the face of the motion, as I am being asked to find, that there has been a publication, even if I were to be persuaded that the publication would appear to be based in some way on a theft of the budget document, as the result of a leak. The fact of an accurate appraisal or prediction of what is in a budget by an outside source speaks in and of itself and on its own merits of the fact that a transgression of the practices of the House has taken place, is not enough to constitute an investigation. I need something more than merely the existence of the prediction, a prediction with which the Minister of Finance takes issue. Therefore, the motion in its form does not allege any misconduct by the minister.
It is a motion based simply on the existence of a report by the reporter who was referred to in the argument. In view of the fact that the Minister of Finance has indicated, first, that he differs with that prediction and, secondly, having investigated the matter and indicated to the House that he is satisfied that there has been no leak and that he is certainly not responsible for it, the House, in its traditions, accepts the word of the Minister of Finance. On that basis, the matter remains closed.
However, if a member wishes specifically to raise an allegation at any time, as was the case with respect to the hon. member for Kenora-Rainy River (Mr. Reid) when the motion made special reference to him, he may do so. When the matter

December 12, 1979
Privilege-Mr. Corbin
came to a conclusion, it was obviously under a different consideration because it followed the Michener precedent. This motion does not come within that precedent at all. Therefore, I find this to be a different case and do not consider it to have a priority which can be attached to this kind of motion if it does in fact affect the privileges of the House.


Hon.   J.-J. Blais@Nipissing: Mr. Speaker, 1 recognize from the comments which you have made that you have recognized, not only today but in the past, the importance of the principle of cabinet secrecy and its impact upon financial documents such as the budget. From what you have said, sir, 1 do not hear any withdrawal from that recognition which you have advanced in the past. 1 trust that what you have said in your decision is that we are completely free to present such a motion as would be in order in terms of calling the privileges of the House into play so that in effect we could get a reference to the Standing Committee on Privileges and Elections as was the case with the hon. member for Kenora-Rainy River (Mr. Reid).
I trust that we are not debarred by your ruling today, sir, on circumstances that may involve circumstances which we have already identified, from presenting a motion that would be in order.


Mr. Speaker:: If the hon. member is asking me to rule in advance on the procedural irregularities of a motion which 1 have not seen yet, he knows that I would not do that.


Walter David Baker: Mr. Speaker, there still arises the question raised by the hon. member for Nipissing (Mr. Blais) as to what extent does an absolute denial by a Minister of Finance with respect to a particular leak exist. I assume that we have not come to the time when the Minister of Finance would have to face another motion drawn on exactly the same set of facts on another occasion, and to which he would give the same denial. That would be a waste of time for the House, and that is certainly within the purview of the opposition.


Mr. Speaker:: Order. It seems to me that the President of the Privy Council (Mr. Baker) is on precisely the same ground as the iton. member for Nipissing (Mr. Blais). It is premature to speculate on what procedural decisions will have to be made until we see the motion.
1 have notice of questions of privilege by the hon. member for Madawaska-Victoria (Mr. Corbin) and the hon. member for Kootenay West (Mr. Brisco).
[ Translation]


MR. CORBIN-LANGUAGE USED BY MEMBER FOR KOOTENAY WEST (MR. BRISCO)
Eymard G. Corbin: Mr. Speaker, I rise under the provisions of Standing Order 35 which says a member cannot use offensive words against either House, or against any member thereof. Yesterday, Mr. Speaker, during
[Mr. Speaker.)
the debate in Committee of the Whole on Bill C-20, the hon. member for Kootenay West (Mr. Brisco) said the following:

Mr. Chairman, I would ask if this is Parliament or is it a zoo? Because those are the animals over there, and I am damned well ashamed of them.

Mr. Speaker, it seems to me in accordance with the very spirit of Standing Order 35 and considering Beauchesne's citation 319, it is clearly indicated no member shall use blasphemous or indecent language. Beauchesne's citation 324 dealing with unparliamentary expressions says, and I quote:
-much depends upon the tone and manner, and intention, of the person speaking;-
The language may be abusive, unparliamentary or indecent. Mr. Speaker, I believe the tone goes far beyond the words, and the tone the hon. member for Kootenay West used to make that statement yesterday appeared to me at first glance both malicious and vicious. I was not the only member who rose on a point of order or a question or privilege yesterday. There was also the hon. member for Vercheres (Mr. Loiselle) who dealt with the same matter. In addition, in Beauchesne, in the list of forbidden parliamentary expressions, it is clearly indicated that the word "animal" is prohibited.
Mr. Speaker, I would not want to make this point of order harder than necessary. I quite simply ask you, if you think 1 am right in my argument, to ask the hon. member of Kootenay West to withdraw his offensive words toward all members on this side of the House, men and women alike.


Mr. Bob Brisco (Kootenay West):: Mr. Speaker, at the time of my outburst yesterday I felt it was warranted. I would like to correct the hon. member for Madawaska-Victoria (Mr. Corbin) who has used the descriptive adjective "vicious", and say that I do not have a vicious bone in my body. I have read my remarks, which were directed at no one in particular. I have also read the comments of the chairman, who felt that I was not out of order because I had not directed them to anyone in particular.
However, for the sake of the decorum of this House I do not hesitate to withdraw the word "animals".


Mr. Speaker:: 1 think we have two principles here. The first is that it is always the individual presiding over the meeting who is in the best position to judge. The chairman at the time made a ruling with which I would not want to interfere, since he was the one present at the meeting when the words were spoken. The second principle is that technically it is difficult to ascribe an absolute meaning to any word so that in all circumstances it will be unparliamentary. But without waiting for that, the hon. member, having had an opportunity to reconsider his intervention, has rather generously withdrawn it. I think that that is in accordance with the best principle of the conduct of the House.
December 12, 1979


MR. BRISCO-NATIONAL ENERGY BOARD HEARING IN VANCOUVER, B.C.
Robert Hylton Brisco: Mr. Speaker, if I may turn for just a moment to something which is perhaps a little more enlightening, yesterday when 1 rose on a question of privilege you, sir, indicated that it was not a question of privilege but made a contribution in your summary which was of significant value. I want to report to you, Mr. Speaker, and to the House that on the basis of perhaps our mutual contributions on the question of the National Energy Board, it has today adjourned the meeting in Vancouver until January, 1980. 1 thank you for your help.


MR. KAPLAN-STATEMENTS MADE BY MINISTER OF EMPLOYMENT AND IMMIGRATION
Mr. Bob Kaplan (York Centre):: Mr. Speaker, my question of privilege arises out of statements made by the Minister of Employment and Immigration (Mr. Atkey) on December 6 before the Standing Committee on Labour, Manpower and Immigration. He appeared before the committee to deal with his estimates. On that occasion he announced a cutback was taking place by the government in its program to support publicly sponsored boat people as refugees from Vietnam. He indicated that in taking his decision he had consulted with the provinces.
I have a transcript here of his remarks before the committee where he said:
-committee members appreciate that federal-provincial consultations are an important part of my mandate-
Later he said:
And at the same time I should say that virtually all those provinces made the point-and this was made no more strongly than by Mr. Couture in the province of Quebec-they said: can you not find some way to provide increased food and medical aid to the victims of starvation in Kampuchea, Thailand. And it is having all those factors in mind-
He was referring to the consultations. Subsequently, an article appeared in La Presse on December 7 in which Mr. Jacques Couture denied that he had been consulted by the minister and denied that he was in favour of the change which the minister had indicated he was making after several provincial consultations. Yesterday, for the first time, I was able to speak to the office of Mr. Couture, the minister of immigration in Quebec, and was able to confirm from their point of view the accuracy of this report, that is, that Mr. Couture had not been consulted about these changes and that he did not approve of them.
In view of that, Mr. Speaker, I rise on a question of privilege, perhaps as much as anything, to give the minister an opportunity to indicate whether he or the minister of immigration for the province of Quebec was making accurate statements about the consultations which are alleged to have taken place.
Government Motions


Mr. Speaker:: Order, please. I am sure the hon. member will realize that for me to permit this would be an extension of the committee proceedings into this House in this way. That is an unwarranted extension of our practice. If the matter is to be pursued any further, it will have to be done in committee or in some other way on the floor of the House. To raise in this way what is evidently a dispute between two persons, one of whom is not a member of this House, on a matter which took place outside this House, would seem to be inviting an extension of committee proceedings on to the floor of this House. The matter will have to be pursued either in committee or brought on to the floor of the House in some other way before I can deal with it.



ROUTINE PROCEEDINGS


[Stage Direction]
On the Order: Government notices of motion:
December 10, 1979-The Minister of Regional Economic Expansion-The following proposed motion:-That the Standing Committee on Regional Development be authorized to review': the present role of the Prairie Farm Rehabilitation Administration in keeping with perceived federal responsibilities; whether the legislative base of the Prairie Farm Rehabilitation Administration should be expanded to include non-agricultural areas and other sectors of the economy, or whether these activities should continue to be implemented under the general Department of Regional Economic Expansion legislation; whether the agency should continue to operate under the auspices of the Department of Regional Economic Expansion; whether the agency should operate in the prairie provinces only, or whether there is a requirement for similar programs in other parts of Canada; whether the agency should continue to exist as a federal agency and if there are any changes to be made in its management and administration;
That the committee report back to the House of Commons no later than September 1980, on any legislation required to implement the committee's recommendations; 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.
Mr. Speaker:: Pursuant to Standing Order 21(2) this notice of motion stands transferred to and ordered for consideration under government orders later this day or at the next sitting of the House.


WAYS AND MEANS
John Carnell Crosbie: Mr. Speaker, pursuant to Standing Order 60, I now table in both official languages, a notice of ways and means motion regarding the Customs Tariff, and request that you designate an order of the day for the consideration thereof.

December 12, 1979
Order Paper Questions
This is the customs tariff that results from the MTN-GATT negotiations, the Tokyo round.


MESSAGE FROM THE SENATE
Mr. Speaker:: 1 have the honour to inform the House that a message has been received from the Senate informing this House that the Senate has passed Bill S-7, an act respecting Canadian non-profit corporations, to which the concurrence of this House is desired.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Orlikow: 1.	Who (a) is the president (b) are the vice presidents of the Cape Breton Development Corporation?
2.	What is the annual salary in each case?


Hon. Elmer M. MacKay (Minister of Regional Economic Expansion):: 1 am informed by the Cape Breton Development Corporation as follows:
1.	(a)D. S. Rankin
(b)B. R. McDade, vice president and secretary
K. Sanderson, treasurer and vice president, Finance
J. L. Dodge, vice president, Operations and Marketing
D. 1. Miller, vice president, Industrial Operations J. Bardswich, vice president, Coal Division.


Walter David Baker: Mr. Speaker, the following questions will be answered today: Nos. 46, 79, 71, 189, 208,
292, 301, 320, 442, 593, 594 and 597.
I would ask that the remaining questions be allowed to stand.
D. S. Rankin B. R. McDade K. Sanderson J. L. Dodge D. I. Miller J. Bardswich


Mr. Speaker:: I believe the President of the Privy Council (Mr. Baker) said question 79 after 46 instead of 69. I believe the intention was 69.


Walter David Baker: Yes, Mr. Speaker.


Mr. Orlikow: 1.	Who (a) is the president (b) are the vice presidents of the Municipal Development and Loan Board?
2.	What is the annual salary in each case?


John Carnell Crosbie: The municipal development and loan board no longer functions. Loan repayments, however, continue. These are monitored by the financial services division, Department of Finance.


Mr. Orlikow: 1.	Who (a) is the president (b) are the vice presidents of the Canada Deposit Insurance Corporation?
2.	What is the annual salary in each case?


John Carnell Crosbie: 1.	No president or vice presidents.
2.	The Chairman is John F. Close, annual salary $15,000-


[Stage Direction]

Mr. Herbert: How many (a) permanent (b) term employees were on the Ministry of State for Federal-Provincial Relations' payroll on March 31, 1979?


Robert Jarvis: (a) 92 employees (b) 2 employees.


Mr. Herbert: How many (a) permanent (b) term employees were on the Department of Finance's payroll on March 31, 1979?


John Carnell Crosbie: (a) 727 (b) 9.


Mr. Herbert: Does the government intend to introduce legislation requiring the labelling of all appliances, equipment and vehicles to indicate the decibel output of the item and, if so, will a maximum noise level be established?


Walter David Baker: Under the Hazardous Products Act, there is already a maximum allowable noise level of 100 decibels for toy products. Consumer and Corporate Affairs Canada does not plan to introduce legislation requiring the labelling of all appliances, equipment and vehicles to indicate the noise emission of the products, nor does the department intend to establish maximum noise levels for all such products.
December 12, 1979

Labour Canada: Labour Canada does not plan to introduce legislation requiring the labelling of all appliances, equipment and vehicles to indicate the noise emission of these products, nor does the department intend to establish maximum noise levels for all such products. The Canada Labour Code which deals with occupational safety and health in federal enterprises, has no provisions for regulating this area. Noise control of these products is subject to provisions of provincial legislation to which provincial governments are actively involved in environmental noise concerns and controls at the manufacturing level.
However, an existing Canadian Standards Association (CSA) standard for chain saws, developed at the request of Labour Canada, includes a sound level and labelling clause which we plan to reference in the Canada hand tool regulations.
Background Information: Under the Canada Labour Code, Labour Canada is responsible for regulating occupational noise exposure in federal work places. The Canada noise control regulations, which apply in federal enterprises, specify the requirements to preclude hearing impairment by the workers. Conplementary provincial legislation also exists in this area. Health and Welfare Canada advises that it does not presently have any regulations under its Radiation Emitting Devices Act concerning noise emission, either audible or inaudible, of equipment but that department is looking at the development of guidelines for occupational noise. Environment Canada no longer has a noise program.
Provincial governments generally are concerned with and are actively involved in environmental noise concerns and controls. For example, the province of Ontario has developed a model modern municipalities in the province. The Canadian Standards Association (CSA) is presently developing a voluntary standard entitled the "Measurement and Rating of the Noise Output of Consumer Appliances." This draft standard includes a proposed labelling component concerning noise output of products. An existent standard at the request of Labour Canada for chain saws includes a sound level and labelling clause.
In the U.S.A., the office of noise control, environmental protection agency, has recently put forward a new package proposing noise labelling requirements for a variety of products such as equipment and appliances.
Transport Canada: Under the authority of the Motor Vehicle Safety Act the level of noise emitted by motor vehicles manufactured in or imported into Canada is regulated. The current maximum noise levels for various categories of vehicles when measured in accordance with specified test methods are as follows:
Motorcycles	86 dbA-decibels, A-scale
Passenger Cars, Light Trucks and Vans
80 dbA-decibels, A-N-scale Heavy Duty Trucks and Buses	83 dbA-decibels, A-scale
It is planned to recommend requirements for the labelling of motorcycles by the manufacturer with the maximum noise
Order Paper Questions
level produced in a simple stationary test, in order to facilitate the control of inuse noise by the appropriate authorities. No plans currently exist for similar labelling of other categories of vehicles.


Mr. Herbert: 1.	What was the total value of construction at the St.-Jean Military Base, Quebec, in each of the past five years?
2.	For the same period, how many (a) contractors (b) sub-contractors had contracts exceeding $100,000 and, in each case, what was the name of the company and the total value of the work performed?
3.	For the same period, what was the total design cost and who were the principle firms of designers?
4.	(a) How many contractors and sub-contractors listed in Part 2 had authorized addition work exceeding twenty per cent of their original contracts (b) were any working on a cost plus percentage basis?


Hon. Allan B. McKinnon (Minister of National Defence and Minister of Veterans Affairs):: 1.	1974/75	$ 1,199,912
1975/76	2,972,369
1976/77	14,470,373
1977/78	36,108,160
1978/79	26,992,028
1979/80	5,596,201
to 31 Oct 79
2.	(a) and (b) eighty one contractors/subcontractors had contracts exceeding $100,000. The names of the companies and the value of work performed is listed in list A.
3.	$8,810,163-The principal firms of designers are listed in B.
4.	(a) 16-These firms are indicated by an asterisk in list A.
(b) No.
List "A"
Contractors with contracts exceeding $100,000, and Current Value of Contract
Contract
Contractor	Value
Omer Brault Limitee	189,257.02
P. Baillargeon Ltee	*203,711.53
Western Caissons (Quebec) Limited	1,638,192.47
Les Entreprises Desourdy Inc.	811,853.41
St-Johns Ready Mix Co. Ltd	1,677,256.75
Acier d'Armature de Mtl (1968) Ltee	633,765.21
Quebec Reinforcing Steel Inc.	538,149.52
Formco Inc. & N.A.F. Limitee	1,480,601.20
Wallcrete of Canada Limited	1,695,616.99
Wallcrete of Canada Limited	2,262,244.08
Universal Concrete Services Limited	152,990.16
Eastern Armoured Floor Limited	130,981.56
Lord & Fils Cie Limitee	524,002.55
Pallotta Metal Works Inc.	425,987.46
Robertson Building Systems Limited	320,846.51
Jean Attore Inc.	4,055,007.32
Les Industries Glaverbel Limitee	291,001.06
Pilkington Glass Limited	734,609.97
Duron (Quebec) Limited	830,467.09
Hickey Plastics Co. Limited	125,339.00

December 12, 1979
Order Paper Questions
Contractor
Polybois Inc.
Herve Pomerleau Inc.
Socame Inc.
Gen. Acc. Ass. Co./Kelly-Leduc Ltd., Staniey-Bumeda Limitee Canadian Johns-Manville Co. Ltd.
La Cie Can. de Marbre & Terr. Ltee Mount-Royal Concrete Floor Ltd.
Nap. Laforest & Fils (1968) Ltee Nap. Laforest & Fils (1968) Ltee Lagendyk & Company Ltd.
Gerco Metal Ltee Westeel-Rosco Ltd.
Les Entreprises Desoudry Inc.
J.M. Szoges Inc.
Cassidy Ltee/Equip. de Cuis. G.H.
Les Constructions Gart Inc.
Pilkington Glass Ltd.
Ernest Leblanc Limitee Kolostat Inc.
Kolostat Inc.
Kolostat Inc.
Award Ind. (Mech) Limited Plomberie Bellerose Inc.
Sto-Bert Inc.
Herve Houde Limitee Vestmor Enterprises Ltd.
Johnson Controls Limited Honeywell Ltd.
Asbestos (1976) Limitee
La Cie Electrique Swift (1974) Ltee
Herve Houde Limitee
Lee Electrical Construction Inc.
Les Ascenseurs Labadie Inc.
Herve Houde Limitee
Les Constructions Impact Limitee
Lucien Desranleau Inc.
Construction Canvar Ltee J.M. Szoges Inc.
Les Gicleurs Acme Limitee Gicleurs Automatiques Beaudoin Inc.
L.M.L. Electrique Ltee F. Vinet Inc.
Chagnon (1975) Limitee R.L.R. Construction Inc.
Taragon Construction Equip. Ltee Raphael Ruffo Collet Freres Limitee Ediitec Construction Inc.
Laurent Gendron Limitee Acier Gendron Limitee A. Marfoglia & Fils Ltee Seven Brothers Construction Inc.
Classic Metal Works Inc.
J. Lewin & Co. Inc.
Bole Inc.
Formco Inc. & N.A.F. Limitee Signalisation Octa Inc.
Foschi & Liberatore Inc.
P. Baillargeon Ltbe
Duranceau Ltee/Beauchemin, Beaton, Lapointe Inc. (Construction Management Services)
Contract
Value

1,388,736.23
633.181.68 185,349.83 319,613.04
545.025.64 1,565,741.16
734,150.99
113.071.00
233.015.47
554.839.68 1,077,751.56
158.927.00
155.506.00 1,353,469.08
134,049.86
1,298,489.14
219,336.50
121.250.34 1,194,260.92
*1,523,864.70 271,125.77 1,289,684.82 *2,143,801.73 1,298,398.20 1,559,612.38 2,291,682.97 110,809.08
939.047.64
129.556.00 604,744.42
*2,035,970.74
*1,400,969.44
1.042.310.04
1.079.319.05 *1,458,345.83 *1,613,094.58
895,660.06
841.762.47
618.875.32
701.152.34 599,899.14
*252,969.37
144,385.17
1,287,311.03
*534,048.80
1,808,728.86
315,375.54
729,964.39
921,433.03
*495,817.38
157,482.85
937.738.33 *365,400.51 *138,172.88
906.463.69 *280,289.80
267,645.58
*133,301.86
*164,702.02
1,588,927.53
*9,944,300.00
Authorized Work Exceeding 20 per cent of Original Contract Value


[Stage Direction]
Principal Firms of Designers:
Dobush, Stewart, Longpre, Marchand, Goudreau/David, Boulva, Cleve Architects
St. Amant, Vezina, Vinet, Brassard/de Stein & Associes

Barre, Pelierin, Lemoine & Associes Pageau, Morel & Associes Archer, Seaden & Associates Inc.
Monarque, Morelli, Gaudette, Laporte Inc.
Leonard Savoie
P. Mundie & Associates
Jacques Guillon Designer
Morrison, Hershfield, Burgess & Huggins Ltd.
Claude Vermette
Mr. Herbert: 1.	Is the government aware of the many errors made by chartered banks and other Financial institutions in the calculation of mortgage interest and, if so, what measures are envisaged to correct the situation?
2.	Has the government considered making it illegal for the vendor of a mortgage to absolve himself of any responsibility from any errors in mortgage interest calculation which are subsequently found?


John Carnell Crosbie: 1.	The government is not aware, at the present time, of any widespread errors in the calculations of mortgage interest by the chartered banks and other financial institutions. Rules defining the calculation of mortgage interest are set out in section 6 of the Interest Act and financial institutions must act in accordance with them. On occasions in the past when the government has received correspondence from individuals suggesting that an error has been made, investigations have been carried out in order to resolve the problem. The new disclosure regulations which will accompany the revised Bank Act will also be of help to the consumer in this respect as they will require the bank to clarify the cost of borrowing to consumers and the manner in which charges are being calculated.
2.	The second question deals with the legal rights of certain parties upon discovering an error sometime over the life of a mortgage. This is a question of contract law which falls under provincial jurisdiction. The question of a mortgagor's right upon the assignment of title to his mortgage to another party is covered under applicable provincial law, usually under the Mortgage Act. Whether or not the originator of the mortgage can be held responsible for the error is determined in accordance with the contract law in that province.


Mr. Herbert: What was the chartered banks' percentage increase in the average annual rate of general loans in each of the past five years and, of this percentage increase, what was the business loan component?


John Carnell Crosbie: This information is published monthly in table 10 of the Bank of Canada Review. For the years ended December 31, the percentage increases were:
December 12, 1979

	General Loans	Business Loans
1978	12.8	10.01977	12.6	11.01976	21.5	21.51975	15.5	12.91974	19.1	20.0


Mr. Herbert: What was the cost to Defence Construction (1951) Limited in the fiscal year 1978-79 for the administration of its European projects?


Allan Bruce McKinnon: 


Mr. Herbert: Was any of the $509,322 shown in the 1978-79 fiscal year financial statement of Defence Construction (1951) Limited as recovery of expenses from government departments and agencies, recovered from the Department of Public Works and, if so, what was the amount?


Allan Bruce McKinnon: No.


Mr. Herbert: In the last fiscal year, what percentage of interest was added by Defence Construction (1951) Limited to (a) accrued employees' leave (b) provision for employee benefits?


Allan Bruce McKinnon: None.


Mr. Speaker:: The questions enumerated by the President of the Privy Council have been answered. Shall the remaining questions be allowed to stand?


Some hon. Members:: Agreed.


Walter David Baker: Mr. Speaker, would you be so kind as to call notice of motions for the production of papers No. 40 in the name of the hon. member for Beauce (Mr. Roy).
Privilege-Mr. Herbert


[Stage Direction]
Motion No. 40-Mr. Roy (Beauce):
That an humble Address be presented to His Excellency praying that he will cause to be laid before this House a copy of the agreement signed during the War 1939-45 (1942) between the government and the government of the province of Quebec concerning the suspension of certain taxes during wartime.
Mr. Ron Ritchie (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, I will answer for the Minister of Finance (Mr. Crosbie). The information requested by the hon. member for Beauce is contained in the wartime fiscal agreement between the Government of Canada and the government of Quebec. This document is public and available at the Library of Parliament. I would therefore ask that the hon. member withdraw his motion.


Mr. Speaker:: Is the motion withdrawn?


Mr. Fabien Roy (Beauce):: Agreed.
Motion withdrawn.


Walter David Baker: Mr. Speaker, I ask that the other notices of motions for the production of papers be allowed to stand.


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


Some hon. Members:: Agreed.


PRIVILEGE
Mr. Hal Herbert (Vaudreuil):: Mr. Speaker, when I rose in the House on Friday to discuss a document that was relevant to the debate, if I may digress somewhat to another motion, you told me to remember that Wednesday was the day to bring up such points. I therefore would like to bring to your attention, and to the attention of the House, the fact that there remain outstanding three sets of documents that I have asked for and the House has ordered to be produced. If the government is going to inform the House and the public at large that the documents are to be produced, I suggest that it should at least indicate the reason for the delay.
Incidentally, the document to which I referred on Friday was produced in my office yesterday afternoon, some four weeks after the government said it would be produced. I thank the government for producing the document.
While I am on my feet, may I refer to the fact that of a total of 29 sets of documents which I have requested, four have been produced, three are now outstanding, awaiting production by the government which has said it will produce them, eight sets
2294

December 12, 1979
The Budget-Mr. Gray
of documents have been refused, and 14 requests, at the moment, have not been answered by the government. In other words, they have neither said that I cannot have them nor that they cannot be produced. They have given no reason at all. At the moment, out of 29 requested, four have been produced.


Walter David Baker: Mr. Speaker, I appreciate the kind remarks of the hon. member with respect to the productions that have taken place. I do not think I have to tell him that sometimes there is difficulty in locating the documents and the information. I think 1 can repeat to him the undertaking of the government to comply, to the greatest extent possible, with the request of hon. members.
I am sure the hon. member will be interested to know that in terms of the percentage of answers to questions, this government has exceeded the former government in the last session. If the hon. gentleman would like me to produce statistics with respect to that, I shall be pleased to do so.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Tuesday, December 11, consideration of the motion of Mr. Crosbie that this House approves in general the budgetary policy of the government.
Hon. Herb Gray (Windsor West):: Mr. Speaker, just before 1 adjourned the debate yesterday evening, 1 said:
The late R. B. Bennett would be proud of this new Minister of Finance this evening, but I do not think Canadians generally, especially middle and lower-income Canadians, would be proud of the minister or of the Conservative government. They will be hoping for an early opportunity to get rid of that government.
Of course, Mr. Speaker, R. B. Bennett was the Conservative prime minister and leader of the Conservative government that was in power in Canada from approximately 1930 to 1935, the years of the Great Depression. There are disturbing resonances and similarities between what the Minister of Finance (Mr. Crosbie) said and proposed in his budget last night and what Conservative ministers of finance said and did during the dark days of the thirties. They had the same fixation with the deficit as the present Minister of Finance and his government. Like the present minister, they insisted that tax increases, especially increases in sales and excise taxes, were necessary in order to reduce or eliminate government deficits, irrespective of the effects on the economy.
In 1932, for example, the Conservative minister of finance of that day, in presenting his budget said, I am told, it was necessary, "at whatever sacrifice, (to) fully meet our financial

obligations, balance our budget and preserve our national credit". He went on to say:
This course may result in hardship. It may entail sacrifice. But in the long run it will result in less hardship, it will call for less sacrifice than that which would flow from a policy less courageous.
We know all too well the results of that courageous Conservative policy of the 1930s. It helped push Canada into a depression, with untold hardship for millions of Canadians. In comparing what the minister proposed last night with what his predecessors did in the early years of the 1930s, it is obvious that the minister and his Conservative colleagues are like the Bourbon kings of Europe, of whom it was said regarding their past experience, "They learned nothing and they remembered nothing".


Some hon. Members:: Hear, hear!


Herbert Eser (Herb) Gray: This cannot be said of the Canadian people. They remember the harmful effects of Conservative policies during the 1930s and the harmful effects of Conservative policies during the years of the Diefenbaker government in the late 1950s and early 1960s. They remember the harmful effects on the Canadian economy of the Conservative non-government that we have had already over the past six months. The Canadian people have also learned a lot from what happened to Canada in the past 50 years during those times when Conservative governments were in office. The Canadian people have learned a lot from observing what is in this budget and comparing it with what the Conservatives promised in this House before the last election, and on platforms across the country during the election campaign.
The Conservatives promised that they would reduce personal income tax to Canadians by some $2.5 billion. They promised to do this in their first budget. They promised to do it even though they believed the government's budgetary deficit to be too high, and even though they predicted it would be higher than the Liberals predicted it would be, and higher than the Minister of Finance admitted it has turned out to be.
On November 20, 1978, speaking in the last budget debate, the Prime Minister (Mr. Clark), then leader of the opposition, said, "We are in a deep deficit position today in this country". But in spite of this, he went on in the same speech to say that Canadians needed a "decrease in federal income taxes of at least $2 billion in favour of all Canadians who could spend that money quickly here in Canada". I say that is quite a change from what we heard in the budget speech last night. The Prime Minister also proposed, at the same time, his mortgage interest deductibility scheme.
In that same debate, the budget debate of last November, the President of the Treasury Board (Mr. Stevens), then the spokesman on finance for the official opposition, said that the deficit for 1979-80 would be $13 billion. This turned out to be quite incorrect. In fact the Minister of Finance has admitted the deficit is substantially below that figure.
The President of the Treasury Board, when he was spokesman on finance for the official opposition, argued also in that debate that the budgetary deficit of the government would rise
December 12, 1979

to $16 billion by 1983. Yet, in spite of this, a few months later in January of this year, while speaking as leader of the opposition, the Prime Minister told CBC News Magazine, in a famous interview-although I suppose it is one the Prime Minister would like to forget-"that to reduce current and future deficits the government must spend more money now to stimulate the economy". A few weeks later he told a reporter that this stimulative deficit would last as long as three years. The Prime Minister and the Conservatives obviously have done yet another flip-flop. The Minister of Finance said just before the budget, as hon. members will recall, that the only stimulative deficit that he would agree to was a smaller deficit.
In order to work out their doctrinaire Conservative fixation with the government's deficit, the Minister of Finance and the Conservatives are willing to force the Canadian economy to come to a halt. They are willing to see tens of thousands of Canadians out of work. They are willing and anxious to impose on Canadians, in addition to the burden of record high interest rates they have placed on them since June 4, the burdens of double-digit inflation and higher taxation. Surely the health of the Canadian economy cannot be looked at primarily in terms of the government's deficit. What is also important, surely, are measures of performance such as the growth of employment, the growth of the economy, and the level of the cost of living. This is not what the Conservatives are doing in last night's budget. These measures are being given second place to a concept which was discredited or, at least, greatly called into question as a result of the bitter experience of the Conservative government of R. B. Bennett in the 1930s.
The budget speech contains the admission that both the government's deficit and the cumulative national debt must be looked at and measured, not in absolute terms, not simply in terms of how many billions of dollars they are, but in terms of what they represent as a percentage of gross national product. Our national debt at this time is in fact a lower percentage of our gross national product than it was during the years of the last Conservative government in the 1960s.
Even the government's own projections accompanying the budget show the results of the higher taxes it proposes for middle and lower-income Canadians will have limited effect on the size of the government's budgetary deficit, the difference between its expenditures and its revenues, a reduction from some $11 billion to some $9 billion by 1984. I want to say in passing that it is significant-perhaps 1 should say I hope it is not too significant-that all these Conservative projections end in the ominous year, 1984. 1 hope that concepts associated with 1984 will not arise out of the mis-government and the non-government of the Conservatives as seen in the budget presented last night.
The further reduction in cash requirements which the government projects in additon to the reduction in its budgetary deficit will come through what the budget papers make clear are non-budgetary manipulations of government loans and investments and its employee pension funds. Yet the government wants Canadians to pay a terrible price for all of this in terms of higher taxes, fewer jobs, less economic growth and
The Budget-Mr. Gray
more inflation. Prior to the election, the Conservatives said they would reduce the government's deficit not by raising taxes but by cutting expenditures. They are allowing expenditures to rise by 10 per cent, an amount higher than the Liberals' intended target. As 1 recall, their target was some 8 per cent.
The Conservatives are promising to cut expenditures. They criticized the Liberals for allowing expenditures to rise too much and too fast, but they are admitting they are going to spend more.


An hon. Member:: Another flip-flop.


Herbert Eser (Herb) Gray: Another flip-flop. Instead of cutting expenditures as they had promised, they are working out their bizarre fixation with the deficit through raising taxes even though they had promised to do the opposite. They promised to cut taxes for individual Canadians by $2.5 billion in the first budget. The budget is in deficit in terms of its favourable impact on Canadians. It is a big zero. Here is their first budget. We heard it last night. We see they are raising taxes for individual Canadians in an unfair and regressive way.
The burden of the increase in excise taxes on gasoline falls most heavily on low and middle-income Canadians. It has nothing to do with anyone's ability to pay. These taxes fall on the Water Street merchant in St. John's Newfoundland, and on the factory worker in Windsor or Hamilton.
Obviously the burden on these two categories is certainly not the same in terms of ability to pay. This tax takes no account of the fact that many people have to drive to work or have to drive as part of their work since there is no practical alternative public transportation.


Some hon. Members:: Hear, hear!


Herbert Eser (Herb) Gray: If the government wants to encourage use of public transport then the budget it presented last night shows a strange way of doing this since it now imposes the excise tax on gasoline used by public transportation companies. The higher price the government wants people to pay for gasoline, in addition to the excise tax and the higher price the government wants the Canadian people to pay for home heating oil, are the equivalent of a new tax. Yes, a new tax! It takes money out of their pockets just as much as would have been the case for a new tax announced in this budget last night, and we had enough new taxes in it as it was.
The government says it is imposing these higher prices to encourage conservation. It says it is imposing these higher excise taxes to encourage conservation. However, for millions of Canadians this is something they will react to with nothing more than bitter laughter. The Canadian climate means they have to use a certain amount of fuel oil to heat their homes adequately no matter what. The distances in our country and the lack of public transport mean they have no alternative to driving to work as much as they do now.

December 12, 1979
The Budget-Mr. Gray
The only result of these higher taxes on gasoline and the higher prices for gasoline and fuel oil will be to lower the standard of living of Canadians. They will have to cut back on what they are now spending for food, clothing and shelter for themselves and their families, in order to heat their homes adequately, in order to be able to continue driving to work to keep their jobs, if they still have jobs, once this Conservative hard times budget goes into effect.


Some hon. Members:: Hear, hear!


Herbert Eser (Herb) Gray: The Conservatives, I suppose, will now point to their refundable energy tax credit as a way of cushioning the unfair blows of these high energy prices and high excise taxes. These credits will not cover all the additional cost. They will clearly cover only a part of it.
The maximum credit for a family of four is estimated in the budget statement as being $220, and that is after two years. Last night I put on the record information about the impact of these high energy prices and high excise taxes on typical families across our country. In all cases the extra costs are far in excess of the value of the credit. For the typical Canadian family there will be, on the average, an additional annual cost of $381 for heating and transportation, far more than the tax credit.
[ Translation]
Mr. Speaker, these raises in the excise tax and the cost of gasoline and heating oil will be too hard on lower and middle-income Canadians. For example, the average Quebec dairy producer and his family will pay $800 more because of this harsh Conservative budget which will lead to depression and recession in the province of Quebec and in the whole country. [English]
This tax credit that the Conservatives have proposed will not be paid to anyone until the spring of 1981 and, at that, only half of it can be claimed at that time. Millions of lower and middle-income Canadians will have to get by somehow, paying the higher Conservative energy price and the higher Conservative excise taxes for at least a year and a half, before they get any part of that credit. They will have to get by somehow for more than two years before they get all of it, just the full amount proposed for one year. In the meantime, they will have to take money away from needed food, shelter and clothing for themselves and for their families, necessities which are going up in cost anyway because of the impact of the higher oil prices and higher excise taxes on the cost of manufacturing and the cost of production.
It is likely that many Canadians will have to go into debt, borrowing at the Conservative high interest rates from finance companies and the like in order to get by until, at the very least, they can have that limited, almost illusory relief from the Conservative energy tax credit. Canadians will find this promised tax credit to be an empty promise, a non-existent promise for at least the next two years.
Last night I said the combination of the high excise taxes on gasoline and the higher energy prices for both gasoline and

fuel oil is the equivalent of more than a $5 billion increase in taxes for Canadians, an increase falling especially hard on lower-income and middle-income people. I said last night it is the equivalent of a more than 14 per cent increase in direct personal taxes, like a 14 per cent increase in the combination of both income and sales taxes.
I have since had some further calculations of this done. I now say that, contrary to what I put on the record last night, there is an even more severe impact. 1 am informed that the household sector will pay a $2 billion net increase in taxes from the higher excise taxes on gasoline and the other excise taxes proposed. To this one must add the additional $5.9 billion consumers will have to spend for petroleum products and natural gas, higher prices for them that are a result of the Conservative policy set forth in the budget last night. As a result, consumers will be out of pocket a total of an additional $8 billion in the fiscal year 1980-81.


Some hon. Members:: Shame!


Herbert Eser (Herb) Gray: Therefore I would like to correct my estimate of last night. I want to say instead that, compared to 1979 direct taxes, the impact of the higher Conservative excise taxes and the higher Conservative energy prices for 1980-81 is equivalent to an increase of 39 per cent in federal personal direct taxes- 39 per cent more, Mr. Speaker!


Some hon. Members:: Shame!


Herbert Eser (Herb) Gray: Even after allowing for the mortgage interest tax credit plan, this will still represent an increase of approximately 30 per cent. That is bad enough, but for those people who do not benefit from that tax credit plan, and most Canadians will not, it will be the equivalent of a 39 per cent increase in federal direct taxes, probably the largest single increase for individuals in the last 30 years.
That is from a Conservative budget, the largest single increase in taxes on individuals since the war, or perhaps even further back than that excluding the difficult period of the second world war. The increase is even larger when you add in the higher premiums imposed by this Conservative budget for unemployment insurance on individual workers. All this reduces purchasing power. It weakens the possibilities for consumer spending.
The government says in its budget it wants to strengthen business confidence. The confidence of business will not be very high when it sees that the result of the Conservative budget will be to cut back on consumer spending drastically. Business confidence will not be very high when it sees that the results of the budget will also be to increase unemployment by at least one per cent next year. This means some 100,000 people without work as a result of Conservative policy.
These 100,000 people will be out of work in addition to those out of work already, people without regular income to spend. The Conservative policy as admitted in the budget documents will have the effect of reducing the gross national product by one per cent next year and increasing inflation by
December 12, 1979

some 2 per cent next year. This increase in inflation will certainly wipe out increases in real disposable incomes, and the reduction in gross national product will mean that there will be no gross national product growth in Canada next year, for the first time in 26 years.
Business confidence basically comes from its belief that business can sell its goods at a reasonable profit, but obviously to do this there must be enough Canadians working with satisfactory incomes to be able to buy those goods. This Conservative budget will have the effect of weakening this basic essential belief necessary for business confidence and the investment decisions which accompany it.
Business will see as well as anyone else that this Conservative budget is lessening the potential for consumer spending. Business will see as well as anyone else that the gross national product will be reduced severely because of Conservative budget policies. In proposing a budget which will increase inflation to double digit levels we see another bizarre flip-flop from a government whose Prime Minister said in this House just a few weeks ago that inflation was his public enemy number one. Well, I think this budget shows the public that its enemy number one has to be this Conservative government.


Some hon. Members:: Hear, hear!


Herbert Eser (Herb) Gray: In his budget and the forecasts accompanying it the Minister of Finance has presented a pretty bleak picture of what to expect, even if there are five years of Conservative government, something the Canadian people, I am sure, have already reached the conclusion they want to avoid having as much as possible.
The Conservatives have made all sorts of promises, including some promises about the goals and objectives they want to reach in terms of the performance of the economy. They said that they were going to increase growth to over 5 per cent by 1985, that they were going to create 1.5 million jobs by 1985, that they were going to reduce unemployment to 5.5 per cent by 1985, and that they were going to reduce inflation to 5 per cent by 1985. In the light of this budget these promises are very hollow and very empty. Instead of now assuring us that the goal of 5 per cent growth will be achieved, the Conservatives in their budget documents are projecting an average growth of only 3 per cent to 1985. So much for another Conservative promise. And for 1980 the government, in its budget documents, forecast real economic growth of only 1 per cent. I say that the impact of the Conservative budget is not to permit any economic growth at all.
While the Conservative estimate, in my view, is obviously very optimistic, it still represents lower growth than any achieved in Canada in any of the past 26 years. That is a shameful proposal and a shameful willingness to accept unemployment and economic weakness in this country on the part of the Conservative government. Instead of reducing unemployment to 5.5 per cent by 1985, the Conservatives in their own budget forecast have opted to push it up from the current rate
The Budget-Mr. Gray
of 7.3 per cent to 8.3 per cent next year, and not to be willing to try to restore it to the current rate even by 1985. Instead of reducing inflation to 5.5 per cent, Conservative policies are now guaranteed to raise it from the current rate of 9.3 per cent to over 11 per cent in the next two years and then to achieve only a very modest reduction thereafter.
These projections themselves are probably understating the negative impact of Conservative policies on the economy because they do not take into account the possibility of efforts of catch-up in wages and efforts of catch-up in profits which will result from the burst of oil-induced inflation created by these Conservative proposals in the budget of last night.
We see that the Conservatives have abandoned their promises of what they want to achieve for the Canadian economy by 1985. They have been willing to admit in their budgetary documents they have done this. This is certainly not consistent with the request of the Prime Minister to Canadians not long ago to raise their expectations, unless, of course, the Prime Minister meant by that that they should raise their expectations as to what they would get from the Conservatives in the way of higher unemployment, higher inflation, and less growth as a result of Conservative economic policy.
What this budget proposes is a multi-billion dollar tax grab from lower and middle-income Canadians-a raid, in effect, on the pocketbooks and wallets of lower and middle-income Canadians-and not to pay for an energy self-sufficiency program, as suggested by the Minister of Finance, except perhaps in a very limited way, but simply to build up government revenues. This tax grab from all Canadians will be used to pay for the government's mortgage tax credit plan, Bill C-20. This tax raid is on the wallets and pocketbooks of all Canadians including Canadians who will not benefit from the plan at all-renters, people with no mortgages, people with incomes too low to claim tax credits-and also cancels out any benefits from those eligible for the plan, if any benefits remain after being offset by the Conservative high interest rate policy.
The Conservatives have also proposed a surcharge on corporate income tax, but this increase is only for two years, unlike the increases in excise taxes and unemployment insurance contributions for individuals-tax increases which are permanent, or at least for as long as the Conservatives are in power. I am sure the Canadian people by now hope that time will be as short as possible.


Some hon. Members:: Hear, hear!


Herbert Eser (Herb) Gray: I think individual Canadian taxpayers will likely not agree that what is found in the budget with respect to corporate income tax increases and personal income tax increases is an equitable sharing of the higher tax burden as between individual Canadians and the friends of the Conservatives, the big business sector of this country.
In his budget the minister mentioned only in passing a deficit which deserves as much and, in fact, more attention than the government's budgetary deficit, and that is the deficit in the balance of payments of our current account of international trade. This budget will do little to help solve that

December 12, 1979
The Budget-Mr. Gray
problem in any meaningful way. This budget says nothing which really matters about interest rates, a factor in this deficit on current account. It does, of course, propose a temporary financing measure to help small business meet the burden of higher interest rates, but this is only for one year, and the burden of high interest rates on Canadians is much wider and heavier than the burden on small business and, of course, that is serious enough. A recognition of this is found hidden in the tables attached to the budget setting out what the government expects to pay in interest on the public debt over the next several years.
In addition, in its provisions to encourage Canadians to invest in shares, the government would allow this to be done only for companies incorporated in Canada and listed on the stock exchanges in this country irrespective of the ownership or control of those companies. Surely this proposal should be, if not limited, at least oriented, to companies which are Canadian-owned or Canadian-controlled.


Some hon. Members:: Hear, hear!


Herbert Eser (Herb) Gray: Otherwise, this proposal would serve mainly as a means of enabling foreign-controlled companies to have even greater access to Canadian savings than they do already simply by making a minority equity interest or an interest in non-voting shares available for public trading, with foreign control of these companies continuing all the same. Surely we want to use measures such as these not only to encourage share investment by Canadians but also to have this done in a way which helps Canadian-controlled companies which often do not have the same access to needed capital as do foreign-con-trolled subsidiaries. It is strange that the special income bonds proposed in the budget as being available to small business for one year are available only to companies which are Canadian-controlled. Why should this not also be the case for the share investment plan proposals? But at the same time why should the share investment proposals be limited as a vehicle for Canadians only for shares of companies traded on the stock exchanges?
This will make it all the harder for many small privately-owned Canadian companies to get the capital they need to expand, to grow, and in some cases simply to stay in business. This Conservative proposal is biased toward larger companies, those big enough to be able to list their shares. Certainy smaller, privately-owned companies should also be eligible under these proposals. Yet, while these proposals have some use, they will not be much help to most Canadians in the middle and lower-income groups. They will not have the $10,000 of the $20,000 to invest in these plans, certainly not with the additional burden over the coming years of higher energy prices and higher excise taxes imposed on them by this Conservative government.
There is something else that might have been done with respect to share ownership, something the Liberals proposed during the election campaign, that is, something specifically
[Mr. Gray.)
aimed at helping workers purchase shares of the companies where they work. It is a worth-while proposal that should have been given priority in the budget instead of some of the other things we have seen in it.
The Conservative answer to our balance of payments problem is to encourage more exports of unprocessed, non-renew-ablc raw materials, this, in fact, is what their decision to allow larger exports of natural gas really means. Rather than use it to build up and expand our petrochemical industry, rather than use it as a substitute for imported oil, Conservatives have agreed to export it and they have done so without getting any commitment that American gas will be available later to Canada on a swap basis at the same price.


Some hon. Members:: Hear, hear!


Herbert Eser (Herb) Gray: They have done so without getting any commitment in return from the United States for greater access for our manufactured goods. The Conservatives have allowed these exports, without getting any final commitment on the building of the northern gas pipeline. They do not have any final commitment from the gas producers that they will finance and ensure the building of a natural gas pipeline to Atlantic Canada. Instead, through this budget, Canadians are being asked to pay higher fuel prices and higher taxes under the guise of helping Canada reach energy self-sufficiency. But to the extent that any of this money is used to find new oil and new natural gas, 1 ask the House what assurance Canadians have from the Conservative government that any new reserves found at the expense of Canadian taxpayers, middle and lower-income Canadians, will not simply be exported to the United States. This is happening with much of the reserves of natural gas found in recent years in Canada, natural gas reserves found with money put up by Canadian taxpayers through higher prices and through tax expenditures.


Some hon. Members:: Hear, hear!


Herbert Eser (Herb) Gray: There was no answer to this key question in the budget speech last night.
As 1 said yesterday evening, this budget is just the opposite to the kind of industrial strategy which this country must have. This kind of strategy must be based on the basic strengths of our economy, our actual and potential energy supplies, and our ability to produce them at less than world price. This strategy must also be based on a commitment gained through government leadership from our industry to produce more end products, more fully manufactured goods both for domestic and, above all, for our foreign markets. Rather than selling abroad more and more of our raw materials in an unprocessed form, we have to produce more end products or fully manufactured goods. This means encouraging Canadian innovation and technology, Canadian entrepreneurship, Canadian ownership and control. It also means ensuring high standards of productivity and efficiency on the part of all sectors of the Canadian economy.
This budget does not do this at all, it conflicts with these objectives, it hampers their achievement.
December 12, 1979

While I have spoken of the minister's speech last night as a budget, in one way it cannot really be described as a budget. The minister has admitted the government has no agreement at all with the producing provinces on the oil price increase he and the government want and which has been set out in the budget. He has no agreement on the new tax on additional oil company revenues from these high prices. As 1 said last night, this tax is not even described in the budget. It is not in the ways and means motion.
So two basic fundamental factors on which this Conservative budget are based are as yet unknown. They are hypothetical. This means we are being asked to vote on a hypothetical document, a phantom document which the minister calls the budget.
The minister says he is going to bring in a bill next year to legislate this new energy revenue tax.


An hon. Member:: He won't be around.


Herbert Eser (Herb) Gray: But even if he is around for a few months next year, he will be doing so, in spite of his complaint about the Liberals using fine tuning because they presented budgetary statements more than once every 12 months. If this is not fine tuning, then at least it shows that the Conservative government is completely out of tune as it shows its inability to manage the Canadian economy. This document is a prime example of Conservative mismanagement and of their inability to lead and to govern.
The minister said in his speech that he will be taking steps to move away from the traditional budget secrecy. Let us look at what he has done already when it comes to this new energy revenue tax that he and the Prime Minister said in the House and at the meeting of first ministers they want to have imposed. The Prime Minister has already admitted, well before the budget was presented, that officials of the government were consulting with the oil industry about the form of this energy self-sufficiency tax, the form of this tax which was mentioned in the budget last night. The minister's officials did not ask lower and middle-income Canadians whether they wanted a higher excise tax on gasoline. They did not even ask them whether they liked the form, or what ideas they had on the form of such a tax. The minister's officials did not ask working people across the country whether they wanted higher unemployment insurance premiums, or even about their form.
The Minister of Finance has an approach to budget secrecy, which he has not outlined in his statement last night. This approach involves a different concept of secrecy, a different concept of consultation when it comes to discussing taxes of interest to the multinational oil companies, than the concept of secrecy, the concept of consultation on measures directly affecting individual Canadians. I say that is the wrong approach to budget secrecy. I happen to believe that we should be getting away in this House from traditional budget secrecy concepts. I think they are outmoded, I think they hamper proper and meaningful discussions of tax measures. What we need is more openness by the government about those parts of the budget that really matter to all Canadians. It means
The Budget-Mr. Gray
making proposals to the House in the budget statement on the basis that the government is open to changing them as a result of input from members of Parliament and Canadians generally at hearings, not in Committee of the Whole, but of a parliamentary committee after the budget is presented. I think that is the approach we should have to a change in budget secrecy, not two standards, not two measures, one for the minister's friends, one for the government's friends the multinational oil companies, and another standard when it comes to individual Canadians.


Some hon. Members:: Hear, hear!


An hon. Member:: Tell that to Bronfman.


Herbert Eser (Herb) Gray: Essentially this budget hits the little guy in this country. If the little guy decides to have a smoke or a drink to try to find some solace from the impact of this Conservative budget, he will still be reminded of its unfair impact. He will also be reminded every time he pays for gasoline at a service station. He will be reminded every time he has fuel oil delivered to his home.
At the opening of my remarks, I spoke of how the Conservatives are like the Bourbon kings of France who learned nothing and remembered nothing. But I think the lower and middle-income Canadians and their families will remember this Conservative hard times budget and they will learn, as the result of its impact on them, the negative impact on them, of this budget, never again to trust the Conservatives with their votes. What we should have had from the Conservatives last night was a budget that would reduce inflation, strengthen the economy and create more jobs for Canadians, now, next year, and in the years to come. Instead, this budget brings Canadians a higher cost of living, including higher food prices, more unemployment and no economic growth, as well as higher gasoline and fuel oil prices, and higher taxes.
In his speech the Minister of Finance quoted Sir Wilfrid Laurier who said the twentieth century will belong to Canada. I say to this House that the twentieth century should belong to Canada and that largely because of the efforts of Liberal governments it has belonged to Canadians generally, but the twentieth century will not belong to Canada if the harmful and negative measures in this Conservative budget ever come into effect.


Some hon. Members:: Hear, hear!


Herbert Eser (Herb) Gray: Therefore, Mr. Speaker, I move, seconded by the hon. member for Outremont (Mr. Lalonde):
That all the words after "that" be struck out, and that the following be added:
this House condemns the government for its budget which will place an unfair
and unnecessary burden of higher gasoline prices, higher fuel oil prices, and
higher taxes on middle and lower-income Canadians.


Some hon. Members:: Hear, hear!


Mr. Olivier:: Mr. Speaker, I rise on a point of order.

December 12, 1979
The Budget-Mr. Rae


The Acting Speaker (Mr. Scott, Victoria-Haliburton):: The
hon. member for Longueuil (Mr. Olivier) on a point of order.


Joseph Mario Jacques Olivier: Mr. Speaker, to my knowledge there is only one minister in the House now, and the Minister of Finance (Mr. Crosbie) also seems to be absent. Maybe he is writing a recommendation to the Socred leader in order that the latter supports him when the motion is put, but it is unacceptable to the House and to the Canadian people that there is only one minister present in the House when we are discussing the budget.


The Acting Speaker (Mr. Scott, Victoria-Haliburton):: I do
not consider that to be a point of order, and I recognize the hon. member for Broadview-Greenwood (Mr. Rae).


Bob Rae: Mr. Speaker, the champagne was flowing freely in the penthouses in Broadview last night at eight o'clock, just as it was in the tenement houses on the Circular Road in St. John's West. After all, imagine the eager anticipation on the part of the Canadian people at eight o'clock as they turned on their television sets. They were eagerly awaiting the promises of the Conservative government, the promises they were looking forward to: the $2.5 billion tax cuts, the special incentives and tax write-offs for small businessmen, intensive capital programs for Atlantic Canada. Also, an end to big government was promised by the Prime Minister (Mr. Clark), and an end to high taxes. This is the government that was going to set the iittle guy free.
Imagine how flat that champagne turned at 9.20 p.m. when Newfoundland's gift to seventeenth century economics completed his discourse. It was not a tax cut, but a whopping tax increase-billions. Over $3.5 billion in personal taxes alone were taken out of the economy and put into the hands of governments and oil companies. There was no action on interest rates. After all, the policies of "Bouey XVI" have been confirmed for yet another seven years. There were no capital programs. There was nothing for the poor, nothing for the pensioners. There was something for the private investors, and nothing for anybody else.
Some have called it a tough budget. Some have said that the budget was actually a courageous one. It was certainly tough on the average Canadian. While the Minister of Finance (Mr. Crosbie) swaggers down Main Street in his mukluks, he is tiptoeing softly through Bay Street and the corridors of power in Calgary and Edmonton. Somehow Clark Kent cannot find a telephone booth when he reaches the Alberta border. This budget is courageous only in the sense that the Charge of the Light Brigade was courageous: "Into the valley of death rode the one hundred and thirty-five."
In my remarks this afternoon I want to talk about the people of Canada, their jobs, and their standard of living. I want to suggest to the Minister of Finance that he start with the people of Canada, with their jobs, and with their standard of living. We ask ourselves: what does this budget mean for the average Canadian? First, it means punitive taxes. Second, it means

prices which continue to climb. It means jobs threatened, that nagging and gnawing insecurity which lies at the heart of every industrial worker not knowing whether he will be able to have his job for the next six months. Down the road it means no change in pension plans, which leaves so many Canadians uncovered and in poverty as they reach age 65.
Thanks to these wonderful projections from the Conservative government, we have been told that we will have no social programs because, as was confirmed again today, there is no money in the bill. Finally the bottom line, Mr. Speaker. Hon. members opposite are so proud of telling members of my party that we have never shaken hands with the bottom line. Well, I should like to introduce them to this particular bottom line. For the average family of four with one working spouse, the tax increases and price increases which have been imposed mean at least $370, and a tax credit of $110. If both spouses are working, which increasingly is the case, because so many families require both spouses working in order to make ends meet, those families will not get a single penny of the tax credit which is being offered to them by the Conservative government, not a single penny of it. Single parent families will pay just as much and receive an even smaller break.
Such a sizeable tax increase would be bad enough when our economy is already slowing down, but it is not just any old tax increase that this government has imposed. It is a hidden tax increase, an indirect tax increase, which makes it worse. I want to try to explain in simple terms which everyone will be able to understand why it makes matters so much worse. Let us look at what the government has told us. The government has told us that we must concentrate on energy conservation. So, we do not have an income tax increase. We have what they call a "conservation tax". The rise in unemployment insurance premiums of some $800 million is to make the scheme look more like insurance. "It is not really a tax. It is in order to get the insurance principles back into the Unemployment Insurance Act." We were not told what the purpose of the tax on booze and cigarettes was. Presumably it is to pay for our sins, since we know that a deficit is sinful. We have been told that by the President of the Treasury Board (Mr. Stevens), so it must be true.


An hon. Member:: It is "sin tax".


Bob Rae: That is right, it is "sin tax". It is "Sineful", not sinful. What about these arguments? Of all the taxes which have been put before us, I want to suggest that the so-called conservation tax is the most dishonest.
I ask Mr. Speaker to think of an average family in my riding. I want to remind the House that my riding is in the downtown area of Toronto. Mr. Jones works in a factory in an industrial park on the outskirts of Toronto. Mr. Jones drives a 1976 model car. Mrs. Jones works downtown. She takes public transportation to work, and the children go to school by bus as well. They live in a house which is 30 years old. They have an oil furnace. As the hon. member for Mission-Port Moody (Mr. Rose) has said often, "Today there is no fuel like an oil fuel". Those are the people who are being lectured, being hectored,
December 12, 1979

by the Prime Minister and the Minister of Finance as being the profligate energy wasters. These are the new profligates, the new sinners in our society, Mr. and Mrs. Jones.
I want to ask the Minister of Finance to answer these questions. Perhaps he can give these answers during the next election campaign when he has an opportunity to meet Mr. and Mrs. Jones if he comes into my riding. Did Mr. and Mrs. Jones build the factory that is on the outskirts of Toronto, requiring Mr. Jones to drive 20 miles to get to work? Did Mr. Jones design the car that gets 16 or 18 miles to the gallon? Did Mr. Jones design an urban transportation system that does not serve industrial parks such as we have in metropolitan Toronto? How can Mr. Jones buy a new, more fuel-efficient car, with consumer loans now running somewhere between 16 per cent and 20 per cent, and higher if Mr. Jones has had the bad luck to run into credit problems earlier? How can he do this when he is getting constant lectures from governor Bouey and others that he is over-consuming, that he is sinning and that he should be restrained?
How can Mr. and Mrs. Jones afford to buy a gas furnace when that involves a capital expenditure of over $1,000 and the interest rates are running at 16 per cent to 20 per cent? How can they do that when the Minister of Finance admitted in this House today that there is nothing in this budget that allows people to write off the cost of changing from oil to gas?
Another question that comes to mind, Mr. Speaker is this: are Mrs. Jones and her children encouraged to take public transportation when she is paying an excise tax of 15 cents a gallon? That is one of the things, along with the charge to the farmer and along with the charge to the fisherman, that puts the lie to this government when it says this is a conservation tax. If it is a conservation tax, why in the name of goodness are they putting it on urban transportation when that is precisely the means of transportation the government wants the people to use to replace the sinful car? If they want to replace the sinful car, what are they asking the farmers of Canada to do- go back to the horse and the oxen? Is that the standard of conservation the government is seeking to apply to the farmer?
Is the government seriously suggesting that the farmers of Canada will be able to conserve, that they are the profligate energy wasters? All the government is doing is passing this on to the consumer, or putting the farmer out of business. The government is giving the farmer two choices. Those farmers who have a lot of market power will be able to pass this on to the consumer. Those farmers, the vast majority of them, who do not have a lot of market power will get stuck. That is the policy and the result of the policy of this government.
Should the Joneses take advantage of the CHIP program, that program which the minister just two months ago was making such fun of and now has come out in favour of, and which is a substitute for a policy on insulation-should they take advantage of the CHIP program to insulate their home when their neighbour has just had wet cellulose poured into his walls by a night flyer insulation company and his house is
The Budget-Mr. Rae
suffering from undue damp and mildew with no reduction in heating cost? Is that the model the government wants to put forward when there is no inspection? I can give the figures, the people, and the houses, for the minister's information. I have done it already in one or two cases of people who have been taken to the cleaners by companies in the city of Toronto, and who have had no inspection from CMHC because CMHC does not provide that kind of inspection.
I want to ask this government where Mr. and Mrs. Jones will conserve? They will not conserve on energy because the energy costs which they are undergoing are constant. There is no way they can conserve without a dramatic change, but not in their lifestyle as has been suggested. The Joneses are not suddenly going to be transformed into upper income civil servants running around Ottawa in Volvos, Mr. Speaker. The Joneses are facing the realities of life. Mr. Jones' factory is not suddenly going to be moved next door to his house. He cannot suddenly demand that the Toronto Transit Commission, which has just had a $61 million deficit, start providing decent 24-hour transit for a 24-hour factory 20 miles from his house outside the city. He must have his car.
The hard fact of the matter is that it is lower and middle-income Canadians who have the gas guzzling cars because those were the cars they bought years ago and cannot now afford to replace.


An hon. Member:: They cannot afford to drive them.


Some hon. Members:: Oh, oh!


An hon. Member:: The Tories say they cannot afford to drive them; "let them eat cake."


Bob Rae: Where will they conserve? They will conserve on other items. They will not buy a new fridge which might be more fuel efficient. They will not be able to afford to buy it. They will not be able to buy furniture. Let me give the minister an elementary lesson in the realities of life. The people who make fridges and furniture are laid off when people do not buy their products. Mr. Jones' neighbour who works at the John Inglis factory making fridges is going to be laid off because the market for consumer durables like fridges is going to go down. That is the meaning of the multiplier effect. It was not invented by the anti-Christ Keynes. It was somebody looking at the reality of an industrial situation who said this is what happens. When you put people out of work, that puts more people out of work, and that puts more people out of work. If you take money out of the economy and tax people to death that is exactly what is going to happen. The people will cut down on entertainment. They will not drink so much, they will not smoke so much, and they will not have such a good time. They will cut down on clothing, and perhaps they will even cut down on food.


An hon. Member:: It might save on health care costs.


Bob Rae: If you cut down on food it might not save on health care costs. 1 suppose the hon. member who has just spoken might suggest that the only perfect energy conservers
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December 12, 1979
The Budget-Mr. Rae
are dead people; the only people who do not consume energy are those people who have passed on to the other side, and 1 am referring to that side over there.


Some hon. Members:: Oh, oh!


Bob Rae: Let me suggest to you, Mr. Speaker, that the lesson is quite simple. Mr. and Mrs. Jones are being taxed, and they are being taxed punitively. That is what this budget does.
I want to compare Mr. and Mrs. Jones to Mr. Lawyer Jones who lives in one of those celebrated tenement houses on Circular Road in St. John's, Newfoundland. The excise tax is a tax that he can afford. Has Mr. Lawyer Jones been told not to buy a bigger or fancier car? No way; no one has said that. Has there been a tax put on luxury cars which are guzzling gas? The answer is no. Is this the kind of price increase that is going to have an effect, or hurt Mr. Lawyer Jones? No, he will not feel it or, if he feels it, he will not feel it as much, and that is the definition of a regressive tax.
I was upbraided the other day by a member of the press who said that the public does not understand me when I talk about a regressive tax. A regressive tax, to put it quite simply, is a tax which hurts some people more than others, and this tax hurts the poor people, the working people and the middle-income people, far more than it hurts the lawyers, the doctors, and the accountants.


Some hon. Members:: Hear, hear!


Bob Rae: The Christmas message from St. John's West is quite simple. It is an old message; to them that hath it shall be given.
Perhaps we could put the lesson another way. If you drink, don't smoke; if you smoke, don't drive; if you drive, don't drink; if you drive, smoke and drink, don't think, because if you think you will wonder why you ever voted Conservative in the last election!


Some hon. Members:: Hear, hear!


Bob Rae: What I have said about Mr. and Mrs. Jones is so much more true of the farmer, and is so much more true of the unemployment insurance payee who is now being asked to pay more through a completely regressive tax. It is a tax that is not progressive, a tax that does not get higher as your income gets higher.
Imagine the effect on a group whom we ignore in this House far too much, the six million Canadians who live in poverty; those people who, because of age, because of circumstances, because of region, because of the peculiarities of history, because of the marvels of the market system, which is the sine qua non of the party opposite, have competed in our society, and, when the race was over, have lost. Those are the people, and there are millions of them-young and old-who are, to put it bluntly, getting a kick in the teeth from the Conservative Party of Canada through the budget which was presented last night.

[ Translation]
Mr. Speaker, I suggest that socially the budget put forward last night by the Minister of Finance is very unfair. It reflects a regressive attitude that threatens the standard of living of each Canadian, whether French Canadian, English Canadian or other. I would simply like to suggest to my friends of the Social Credit Party of Canada that we are going to move an amendment to the motion put by my colleague from Windsor West. I also take the liberty of suggesting to them they can no longer support a government that is taking money away from the have-nots in order to give it to the haves.


Mr. Caouette:: Come now, be serious!


Bob Rae: I am very serious. I am hearing the minister's words. We have a system of excise taxes that is the most regressive that can be imposed, because these taxes have been rejected by all progressive parties since the turn of this century. And I urge my colleagues from the Social Credit Party of Canada to read it closely, and to weigh seriously the consequences if they go on supporting a government that threatens the basic principles of social justice, which are so important to our future, especially at this point when we are entering a period of economic and social crisis.

I would like to move from the condition of Mr. and Mrs. Jones to looking at the condition of the whole economy. It was John Maynard Keynes, who has become the anti-Christ of the Calvinist economics practised by the other side, who said something which 1 think is worth reading. John Maynard Keynes said:
-Practical men, who believe themselves to be quite exempt from any intellectual influences-
And that, I think, would include the Minister of Finance.
-are usually the slaves of some defunct economist. Madmen in authority-
And I will leave it to the imaginations of hon. members as to whom that implies.
-who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back.
I had a hard time trying to think of who the economist is behind the ideas of the Conservative party. It could be Milton Friedman, as it is frequently said, but while intellectually defunct, he is still alive.


Mr. Rodriguez:: John Turner?


An hon. Member:: Joe Clark?


Lorne Edmund Nystrom: Eugene Whelan?


Bob Rae: Joe Clark, John Turner, many names have been suggested to me by my colleagues, but I think that we have tracked it down to that nineteenth century economist who tied the rise and fall of the business cycle to the existence of sunspots. There is about as much connection between sunspots
December 12, 1979

and the business cycle as we get from the Conservative party in their understanding of the nature of a modern economic system. The fact of the matter is that the real health of the economy is portrayed by whether or not Mr. and Mrs. Jones have a job, can keep the inflation from which they are suffering under control, and can provide for their children in the future.
When we look at the over-all effects of this budget, they include a dramatic redistribution of wealth toward certain provinces, redistribution of wealth toward certain classes, and redistribution of wealth toward certain companies. That is the nature of this government's energy policy. There was a great deal of comment when my leader got up today, as we expected there would be, and pointed out that of this $90 billion which was being collected, $40 billion will go to the producing provinces, $33 billion will go to the multinational oil companies, and $17 billion will go to the national government. Of that $17 billion, a small fraction will go to the national energy fund.
The second thing about this budget is that it is a redefinition of a clarifying of the role of government in our society. It is a redefinition which ignores the economic, social, and political revolutions of our time. That revolution is that people will no longer accept being treated as commodities in our society, to be traded, shipped, transferred, and paid for as though they were another commodity.
With a reduction in the role of the government in the economy such as predicted over the five-year period by the Conservative party, the growth and expansion of large multinational companies, which will be subsidized again as they were subsidized in the past by the Liberal party, will continue. The Liberal party has presided over the sell-out of Canada to these multinational companies. It is something of an irony to hear these reborn, new born, born again Liberals, as if that party sprang immaculate from the loins of the hon. member for Windsor West (Mr. Gray) on May 23, 1979.


Some hon. Members:: Hear, hear!


Bob Rae: That party has a history which the people of Canada will not readily forget. Whether they are left, right, or centre, they have presided over the economic sell-out of our country, and that is a lesson which no Canadian will readily forget.


An hon. Member:: They should wash their mouths out with Tory policy.


Bob Rae: They have been washing their mouths out with Tory policy for many years.
finally, the element in this budget which is the most unacceptable to most Canadians is the unfairness or the problem of equity. The challenge of the crisis of the 1980s, if there is an economic crisis and an energy crisis-and we accept the fact that there is and are not doubting for a moment that there are very serious problems with energy and within our economy- and if an election must be fought on this issue then let it be
The Budget-Mr. Rae
so-is who will bear the sacrifices of the 1980s. Will it be the members of the Empire Club, whom the Minister of finance is so happy to inform that they will have to tighten their belts as they dig into another course? Are those the people who will be making the sacrifices in our society? I suggest not.
1 suggest that the people who are being asked in this budget to make the biggest, the most important, and the most difficult sacrifices, are those who can least afford to do so.


An hon. Member:: Oh, oh!


Bob Rae: I hear an hon. member catcalling; that is what we expect from him as he faces the slaughter.
We only need to look at those elements. What have they done? It is appropriate as the power in Canada moves from Toronto, where the Liberal party with MURBs as tax shelters put big advertisements in The Globe and Mail saying, "get your shelters in there". Let me suggest that as soon as this budget is passed, there will be other advertisements, but the difference will be that instead of advertising for MURBs they will be advertising for fishing vessels. It is appropriate that the Minister of finance have an interest in seeing that fishing vessels are built. We have the same interest, but the question is how do we get them built? Do you bribe the lawyers, the accountants, the doctors, by giving them a tax write-off? If that is the way to do it, then I suggest it is a society of which most Canadians do not want any part. If they were aware of the cost of the tax expenditures and the subsidies to the wealthy in our society, they would be shocked.
a (1700)
I want to suggest an alternative to these policies. I think it was Maurice Chevalier who, when asked what it was like to be 75, replied that when you consider the alternative, being 75 is not so bad. 1 said it was Maurice Chevalier, Mr. Speaker, and not the hon. member for Winnipeg North Centre (Mr. Knowles)!
None of us like the fact that the Liberal party has left us with a gigantic deficit as a result of the extraordinary tax policies they followed, the incredible expenditures they allowed, and the pork-barrelling which was the defining quality of the Liberal party. When the tomb of the Liberal party is built, a large statue of Mirabel will be placed on it. That represents the worst form of public spending that we have seen.


Some hon. Members:: Hear, hear!


Mr. Caccia:: Even the Tories applaud you.


Bob Rae: 1 find it no more unacceptable to be applauded by Conservatives than 1 do the odd time that I am applauded by my friends to the far right in the Liberal party. Guilt by association is not pleasant, but it is not always possible in this game of politics to choose people who decide to align themselves with you for their own reasons.


Mr. Grafftey:: How pompous!

December 12, 1979
The Budget-Mr. Rae


An hon. Member:: You should know.


Bob Rae: There are alternatives to the policies of this government, Mr. Speaker. This is the last time we should be taking Canada on a forced march to a reduced deficit of $4 or $5 billion in 1984. On the government's own figures, this will lead to unemployment of 7.5 per cent, which is an increase. Inflation will remain at exactly the level it is at now, but next year will be higher. We have to ask ourselves what we are getting. We are getting Herbert Hoover and R. B. Bennett, but I do not see any advantage to the policy.
The minister says that we have terrible unemployment and terrible inflation in Canada and that we need a five-year plan to deal with these horrendous problems. But with this five-year plan we find we have exactly the same inflation and the same unemployment as there is now. if that is the kind of long march the minister now wants to take us on, I suggest he put on his mukluks and head off by himself. He will not be followed by the rest of the Canadian people.
In his closing remarks the minister mentioned his grandfather. I should like to mention my grandfather. Seventy years ago he came to Canada as an immigrant, worked hard, fought in a war, suffered through a depression. Were he alive today, I doubt very much that he would find anything has changed in the consecutive budgets produced by Liberal and Conservative governments.


Some hon. Members:: Hear, hear!


Bob Rae: I should like to recite to hon. members a poem by T. S. Eliot, which goes as follows:
Though you have shelters and institutions,
Precarious lodgings while the rent is paid,
Subsiding basements where the rat breeds Or sanitary dwellings with numbered doors Or a house a little better than your neighbour's;
When the Stranger says: 'What is the meaning of this city Do you huddle close together because you love each other?'
What will you answer? 'We all dwell together
To make money from each other'? or 'This is a community'?


William Heward Grafftey: You look like a college boy now.


Bob Rae: I see the minister with his usual knowledge and common sense has a comment. I should like to tell him where I first saw this poem. It was in a United Auto Workers' hall in Port Elgin, Ontario. If he wants to go and see it himself, he can. The message that came from that union movement is one with which I am not the least bit ashamed to associate myself. It is:
What will you answer? 'We all dwell together
To make money from each other'? or 'This is a community'?
Let me suggest that there is a very clear alternative to the policy of this government which is about to be defeated, and that alternative is a policy which recognizes that Canada is a community-not a community of communities only, but a community. It is a community in which the critical question in

the 1980s will be: are we simply here "to make money from each other" or are we here to do something different?
In the policies which this party suggested during the election campaign, such as a cost of living tax credit, the need for an industrial strategy, the importance of providing jobs for Canadians and looking at the real health of the economy, and not some abstractions which so upset hon. members opposite, we have suggested that there is an alternative to the policies of the government. That alternative is the social democratic alternative.


Some hon. Members:: Hear, hear!


Bob Rae: Let me suggest that between the new Conservatism and the new democracy there is no middle ground. It has something which my friends to the far right in the Liberal party are quickly going to discover, that there is a message in this budget-the government has thrown down the gauntlet, the government has waved its flag and said, "We dare you in these trying political times, with the resignation of the leader of the Liberal party, to oppose the policies with which we want to take Canada into the eighties." We accept that challenge, Mr. Speaker. We accept it happily. We accept it with confidence and with vigour, because we are convinced that the message contained in this budget is a message of injustice. It is a mean message, not a generous or compassionate message; it is a message which will be rejected by the Canadian people because it is so mean and not compassionate.


Some hon. Members:: Hear, hear!


Bob Rae: Mr. Speaker, 1 therefore move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That the amendment be amended by changing the period at the end thereof to a comma, and by adding immediately thereafter the following words:
and this House unreservedly condemns the government for its outright betrayal of its election promises to lower interest rates, to cut taxes, and to stimulate the growth of the Canadian economy, without a mandate from the Canadian people for such a reversal.


Some hon. Members:: Hear, hear!


Mr. Jim Hawkes (Calgary West):: Mr. Speaker, I rise in this House as the first new member of Parliament to speak on the budget debate. As I sat here and listened to hon. members opposite, I was reminded of some phrases that were thrown at us that I might like to twist and throw back at them.
There is a choice for Canadians, and the hon. member is correct when he says that our budget clarifies that choice. One of the choices we have is to continue to deal with poetry or choose to deal with reality. Are we going to become a nation of doers, or are we going to continue to be a nation of dreamers? Are we going to deal with promises, or are we going to deal with plans?
I am particularly proud to stand up in this House today, because about three years ago I committed a significant portion of my life working within this political party to develop plans for governing this nation. As most new members of
December 12, 1979

Parliament have done, one does so at some personal cost in terms of time and other dimensions. I chose to do so, and I think most of the new members on this side of the House chose to do so because we were concerned about this nation and about the direction in which it was heading.
I understand that it is parliamentary tradition to be allowed a little latitude on the subjects to which one chooses to address oneself during the throne speech debate and the budget debate. I am going to digress from the budget for a moment but 1 will return to it.
I want to deal with something which has caused me increasing concern as I sit here day after day. We on this side have been accused of being no different from the previous government. I think one of the differences, which has been long in the planning and is taking some time in the execution because of obstructionist tactics from the othei side, is the reform of the institution of Parliament. In the last week or two we have been treated with increasing frequency to those kinds of tactics which delay, which waste the time of members of the House, which waste the attention of the Canadian people, the longterm consequences of which are for Canadians to lose faith in their political process.


An hon. Member:: They waste the taxpayers' money.


Frederick James (Jim) Hawkes: This government is concerned about changing the institution of Parliament and, after having sat in this House for only two months and three days, I understand even more completely why that is a priority of this government. In that connection I would just like to review our two-month record with respect to the change of this institution. The most important piece of legislation which is before this House and before the Canadian people is the freedom of information bill. If we, as Canadians, are dependent upon the interpretation of information which flows from the other side of the House, we are going to be bankrupt of ideas, bankrupt of the kind of information which will enable us to make solid decisions. If we pass the freedom of information bill in this House, and then put the information out into the public domain, we can let Canadians decide who is telling the truth and who is playing a magician's game.


Some hon. Members:: Hear, hear!


Frederick James (Jim) Hawkes: We believe in that principle over on this side of the House, and I believe our actions give credence to that principle.
Last night we had our Minister of Finance (Mr. Crosbie) stand before us and lay out for the information of the Canadian people, for the members of this House, a five-year budgetary projection, not a six-day wonder, not a six-month wonder, but a five-year budget projection. That is what we laid out in the House of Commons. And that is an important principle for the kind of stability which this nation needs.
Members opposite might ask: what is so important about that? Where is the courage in that kind of step? Well, Mr. Speaker, 1 say to the people of Canada and to the members of
The Budget-Mr. Hawkes
this House that in the next five years we are going to have those numbers thrown back at us. They are projections which represent the best guess we can make today as to the state of the economy over the next five-year period of time. As is true of all guesses, not all of them will be correct. And members opposite will take advantage of that and attempt to throw those figures back in our faces. But I say that the Minister of Finance, and this government, have the courage to say to the Canadian people, "This is the way we think it will go." We had that same kind of courage in March, April and May of this year.
Based on the information which was provided to us we laid out to the Canadian people the kind of steps we felt we would be able to take, the kind of things we felt were necessary to undertake. And today we are getting some of those things flung back in our faces. In some cases 1 welcome the opportunity to debate them.
One other thing 1 would like to say before I turn to the budget itself is that we have had another historic precedent set by the Prime Minister of Canada (Mr. Clark) in recent days. The Prime Minister chose to voluntarily appear before a committee of the House of Commons to defend his personal budget. The accountability of the expenditure of taxpayers' dollars begins on this side of the House. From the Prime Minister it flows to the cabinet, and it continues to be a concern of each and every one of us who sit on this side of the House.


Some hon. Members:: Hear, hear!


Frederick James (Jim) Hawkes: As I learn my parliamentary responsibilities in the ten standing committees of the House, and listen to question period, I hear many pleas from the other side of the House to spend money. 1 cannot recall, in two months and three days, a single suggestion of how to save money or how to raise the increased taxes to pay for what they propose to spend.
Mr. Speaker, the information provided to me as a member of Parliament, which is relevant to this budget and to the Public Accounts of Canada, is a stack of information which in reality is about 12 inches high. It is difficult material to comprehend. It was made available to us yesterday. If it is difficult for a member of Parliament to comprehend, 1 can imagine how confused the Canadian people must be in many cases about the provisions of the budget and about the state of the economy in Canada.
I would like to try to pin it down to some fundamental aspects that we should be debating with great gusto. The New Democratic Party is clearly on record as favouring a larger deficit. The Liberals talk about our "bizarre fixation" with the deficit.


An hon. Member:: Bookkeeping matters!


Frederick James (Jim) Hawkes: I would like to ask the Canadian people to look at their family budgets. If one makes $500 a month and spends $600 a month, 1 ask the Canadian people: how long can you continue to do that? If you make $500 and you spend

December 12, 1979
The Budget-Mr. Hawkes
$600, how long can you continue to do that? If you make $2,000 but each and every month you spend $2,400, how long can you continue to do that? One year, two years, three years, four years-we have now had seven years in a row of that kind of spending. When we stand on this side of the House, and the finance minister stands up and says, "we must reduce the deficit," that is what he is talking about.
In the absence of the kind of controls which we on this side of the House are proposing, we have a future, but it is a bankrupt future. In the presence of the kind of expenditure controls and taxing policies proposed on this side of the House we have a rosy future. But we must begin to pay our way.
1 ask the people of Canada to consider what happens if they take their Chargex card, or oil company card, and spend each month 20 per cent more than they make. Sooner or later you have to pay it back. You have to begin paying the interest on it and your expenses rise. The situation in Canada today is such that the federal government will be borrowing something in the order of $12 billion. That is the size of our deficit. The finance minister stood up in this House last night and talked about the cash requirements of the government. 1 wonder how many Canadians really understand those words, the cash requirements of the government.
1 would like to draw an analogy. Out west we have a tradition called the auction sale. 1 think it exists in all parts of the country. We make great use of it. The auctioneer tries to get a big crowd with a lot of money, to compete for what he is selling. That is his job, to get the best price he can for his customer. 1 draw to the attention of the Canadian people that money is a commodity. It is like a car or a sofa, a commodity. It is in limited supply under any responsible government.
The way we auction money in the world is on the basis of interest rates. What you are doing in Canada today with a $12 billion debt is forcing the Government of Canada to go out and borrow in that restricted money market $600 for every man, woman and child. You are putting pressure on that auction market. If the government were not borrowing that much, the lenders would have it to lend to the private sector. There would be less competition. Ultimately we would have lower interest rates, the kind we can all live with.
The government is an unfair competitor in that auction sale for money and for resources. It, and it alone, has the power to tax. It can determine what it spends and what it raises. None of us in a free democracy have that choice. The government makes that decision on our behalf, and it has been making some terrible decisions over the years.
I would like to go to another feature of the budget. 1 saw over television last evening the president of the chamber of commerce from my area, Calgary.


Mr. Benjamin:: Another barefoot boy.


Frederick James (Jim) Hawkes: He was one of the people who was very critical of the government for its budget. This criticism was based on

the fact that we were not cutting budgetary expenditures quickly enough. I bring to the attention of the House that close to 80 per cent of the budgetary expenditures laid out in the documents before us are a consequence of legislation passed by this House or agreements signed by the previous government. 1 wish to illustrate the three most important parts of those expenditures.
The first is interest on public debt. We are approaching the point where 20 cents out of every dollar we raise through taxation is used to pay the interest on the debt created by government. I ask members opposite who want this bigger deficit, who want this government to borrow more money, how much social good could be done if we had that 20 cents of every dollar to give to the senior citizens of this country. Let's not be dreamers, let's be doers.
Let me come to the second large item which accounts for more than 30 cents of every dollar. That is the transfer payments to persons: unemployment insurance, old age pensions, family allowances, and social assistance of various kinds. Thirty cents out of every dollar goes to those kinds of people. This government has decided to leave the indexing provisions in place. Those allowances which go to the disadvantaged of this country will increase at the same rate as the cost of living. They are protected by this Minister of Finance and this government. That is a point we should make with clarity.
Another area of expenditures which accounts for approximately 20 cents out of that dollar is the transfers to provinces and other jurisdictions. Those are agreements which come up for renewal in 1982. If the Prime Minister continues on the course which he has started, which is working within a federation-not trying to run the whole show, but working with the provinces-I am optimistic that by 1982 the fiscal arrangements which we as a federal government have with the provinces can be arranged. Somehow they can be made more equitable so that the federal government will have more freedom of choice in its expenditure pattern.
These are the major features, interest payments on public debt 20 cents out of every dollar, transfer payments to persons 30 cents out of every dollar, transfers to provinces 20 cents out of every dollar. There are other agreements which account for the remaining 10 per cent. There is very little room in a federal budget for a new government to make significant changes because the agreements which have been signed are historical and long range.


Leslie Gordon Benjamin: Why didn't you say that during the election?


Frederick James (Jim) Hawkes: We did say much of that during the election. We said we wanted information, we could not get it and we could not tell. However, these were the directions. This budget is consistent with the directions 1 talked about during the election campaign.
Members opposite would have Canadians believe there will be no change in what they are going to find in their income tax form when it arrives at their houses next January. Let me just run over a few of them. I have used the context of a man and wife with a couple of children. 1 simply say that Canadians
December 12, 1979

should look at this tax form. Their personal exemptions this year compared to last year will be $530 higher. The mortgage deductibility provision will allow many of them to deduct $375, and the energy tax credit will amount to $240 for many of them. Those are three of the major ways in which each individual Canadian family will be helped. That comes to almost $1,200, which is $100 that is non-taxed each month. Those are significant changes to all Canadians, and they should be identified. On that one they do not have to trust members on this side or the other side of the House. They can look at their individual tax forms and determine for themselves.
What have we done in terms of raising taxes? Members opposite would have you believe that we have really clobbered the Canadian people. That, I suggest, is simply not so. The group which will be hardest hit in terms of tax increases are the corporations.
The group of corporations which will be most affected by changes in tax legislation are those corporations which are engaged in the oil and gas industry. Those are the corporations, some 700 of which have headquarters in the city which 1 represent in this House of Commons, and I know that the chief executive officers and employees of those companies do not welcome the kinds of tax changes which will affect them, because the world for them will be significantly different after last evening than it was before. However, at the same time, the people in that industry-my friends, my neighbours, and the people who live around me-are Canadians first. 1 should perhaps back up from that and say that they are human beings first, the same as the rest of us.
Hon. members opposite talk about multinationals as if there were no human beings inside those corporations. Well, my friends and neighbours laugh, love, and breathe the same as hon. members of this House of Commons and those who work in the automotive industry and every other industry in this country.


Some hon. Members:: Hear, hear!


Frederick James (Jim) Hawkes: 1 said that they are the same. They are in some ways. In some ways we do not do justice to what may in fact be the best example of pioneering left in Canada today, but there is a branch of that industry which is very seldom talked about and should be talked about more, and that is the exploration end of the industry.
Living in this part of the country, Ottawa, is a new experience for me, but when you live in this part of the country you come into contact with the oil and gas industry because someone drives a truck up to your home and puts fuel oil in your tank, or you drive your car to a service station and somebody puts gasoline in your tank. Let me tell hon. members that the oil industry begins out in the field in 40 below Fahrenheit weather with a wind-chill factor of 120.
What are we doing out in the bush country day after day in that industry? We are drilling a hole one mile, two miles, three
The Budget-Mr. Hawkes
miles, or perhaps four miles deep in the ground. How are we drilling it? The same way one drills a hole in a piece of wood. There is a drill down there except that that drill is going down through a narrow pipe. Sometimes it runs into granite, and it does not last very long. You are down there two miles in your search for oil and gas, and you have to bring up that whole two miles' worth of pipe to change the bit on the end of that drill. It comes up in 30-foot lengths. It is steel, and let us remember that the wind-chill factor is 120 below. That is where the oil industry begins, and that is what we are talking about when we are talking about oil self-sufficiency. It is human beings out in the bush in very difficult circumstances.
I would like the public record to show that by October 1 of this year in the province of Alberta alone there had been 19 industrial deaths in that industry. It is an industry which employs approximately 7,500 people when it is flat out. There were 3,500 time loss accidents. It is a hazardous occupation, full of risk for those who choose to invest in it, but a risk of life and limb for those who choose to work in it. Let us not forget that.


Leslie Gordon Benjamin: No health and safety laws in Alberta.


Frederick James (Jim) Hawkes: The hon. member opposite talks about health and safety laws in Alberta. We have a tradition in Alberta and in Alberta governments of listening to the people, not telling them what is good for them. We have just gone through a commission in which we looked at health and safety aspects. That will be done again and again. If there is any chance to improve the climate, I think we will be out in the forefront of those who seek to provide the kind of improvement which is necessary.
Mr. Speaker, all public policy is biased. There was never a government invented which could make a decree of any kind which did not show bias in favour of some and against others. Any document such as a federal budget should be judged in the light not only of its details as they impact on particular individuals but also in the light of what it attempts to do and the fact of whether it will accomplish what it intends to do. In his own words and in his own way, the Minister of Finance expressed his view of the budget as a budget which would rely on the initiatives and the sense of enterprise of Canadians. I reviewed the budget and came to some different words which may have relevance for our deliberations, but I think the budget addresses itself in two primary ways to the Canadian condition. What it attempts to do and what I think the policies of this government collectively attempt to do, is bias the universe for at least a period of time in favour of ownership. That is the first thing it does, and if one really looked inside the tax changes as they are going to affect Canadians, 1 think one could see that.
The most publicly visible part to this point is the mortgage deductibility plan, which encourages Canadians to own homes and makes it a little more possible for them to finance the costs of those homes.
One of the provisions which is in the same category is the provision related to spouses in small unincorporated busi-

December 12, 1979
The Budget-Mr. Hawkes
nesses. For years, husbands and wives have been running small businesses and working long hours. The tax system has not encouraged that. The tax system has discouraged that. In terms of signalling a change in direction, that small provision, which is not at high cost to the taxpayers of Canada, is simply an expression of willingness on the part of this government to acknowledge the importance of husbands and wives working together to create businesses and economic futures for themselves. Owning a business and spending the 16 to 18-hour days which small business frequently requires is not everybody's cup of tea, yet as a government we still wanted to encourage ownership.
The provisions in this budget which address themselves to the issue of common stocks and related matters, 1 think, are an encouragement to all Canadians to invest in enterprises inside Canada. If you do not feel competent to run your own business, then this government wants to encourage you to put up part of the money and put it into the hands of somebody with the skill and drive to go out and make it grow through some other means. That is what the common stock provision is, and that relates to the issue of ownership.
The debenture bonds which will help relieve small business from the high cost of interest rates are interesting in two ways. It is a budgetary provision which is targeted to the principle of ownership, and it is a time limited provision. It is a step we need to take in this particular economic climate, but it is one which we hope a year or two down the road can disappear because it will no longer be needed as the government will be borrowing less money. The cost of money will go down, and we will all benefit from that.
The provisions related to capital gains on farms are another example of what I call the ownership philosophy which characterizes the budget which we heard last night.
The second major issue to which this budget addresses itself is something which professional economists would call the infra-structure concern, and we see its expression in the energy package. We see some words dedicated to the starting of an energy bank. In my city the words "energy bank" conjure up an image of oil and gas and their exploration. I want to say to the people in my riding that the words "energy" and "energy bank" in the Canadian context are much broader than that. We are talking about bringing substitute energy sources on stream so that individuals and corporations can have the kind of fuel which is indigenous to the regions of this country in economic terms so that they can go out and get the job done in the region.
Is my time up, Mr. Speaker? I will conclude very shortly. I have one idea which I would like to lay out for public debate and I hope that people will communicate with me on it. I think there is something psychologically damaging about the concept of unemployment insurance. I would like to throw out into the public arena of policy debate the whole concept of employment insurance. I believe the key word in both instances is insurance, and I think the steps in last night's budget move us closer

to the reality of the insurance principle. But I think there is something psychologically damaging to the recipients of insurance payments when we say to them, "You cannot work, you cannot do things that are socially useful the way your friends and neighbours do." I would like us to begin to engage in a debate on a fundamental change in relation to that program in the direction of employment insurance. I would caution members of the House and members of the government that such a fundamental change should not be entered into hastily, but I think it is an issue that we might well support over the next year or two. Thank you for your attention.


Some hon. Members:: Hear, hear!


Mr. Dennis Dawson (Louis-Hebert):: Mr. Speaker, it is a pleasure for me to participate in this debate on this budget which is the first and, I hope, the last one of the present Minister of Finance (Mr. Crosbie). It would have been more interesting even for the new member to speak on a budget with positive points. The hon. member even admitted to participating a few years ago in drafting the economic policy of the Progressive Conservative party, so I think he might have been better off keeping his mouth shut.
That is not so, Mr. Speaker, no, there is nothing in this budget to talk about, nothing to give Quebeckers and Canadians generally the least impression that there is something progressive in that so-called Progressive Conservative party. I would have liked to see the hon. member talk of job creation. Unfortunately, we heard nothing or nearly nothing about that, Mr. Speaker. In a speech that lasted over an hour, there were 30 seconds on job creation. One paragraph out of 25 pages, Mr. Speaker.
Not only nothing in terms of job creation, but in addition there are measures harmful to job creation in Canada. The rise in the price of gasoline, Mr. Speaker, as was pointed out by the critics of this budget, is going to create at least 100,000 more unemployed. If you add to that the other harmful measures in this budget, we will have at least 150,000 new unemployed. I could talk at length about the absence of concrete measures in the budget to protect the purchasing power of older people. There is nothing, Mr. Speaker, absolutely nothing, only higher transportation costs and unemployment. Nothing for pensioners. They will have to pay more to travel within their cities. They will have less purchasing power because inflation will probably reach 10 and 11 per cent. There will be less money for food and less money for clothing.
What about workers, Mr. Speaker? Workers will see in this budget an increase in their transportation costs to get to work, an increase in their contributions to unemployment insurance so that at the end of the week they will end up with a loss of at least 2 or 3 per cent on their regular salaries as a result of the budget measures alone, not to say anything about inflation. Before this budget, these same workers, these same unem-
December 12, 1979

ployed, these same pensioners were sure that thanks to these programs their purchasing power would be protected. This is no longer the case, and I shall mention the high interest rates they have to pay on their loans.
The Canadian farmers whom hon. members of this Progressive Conservative government and the Social Credit Party of Canada claim they want to defend will have to pay more for the gas they need to operate their farm machinery and to carry their products to markets and to consumers. The budget will cause all these things farmers need to cost more. They may cost the average farmer between $500 and $800 more a year. This budget was put together by a Progressive Conservative government which claims to be the farmer's friend. This Progressive Conservative government has been supported for the past six months by Quebec Social Creditistes who also claim they are the farmer's friends. Well, Canadian farmers will certainly remember this Progressive Conservative government. In the next election Quebec farmers will remember Social Creditistes who let this government come up with this budget. We hope it will be called soon, Mr. Speaker, even if it implies an election campaign in the middle of winter. Farmers will remember Social Creditistes and Progressive Conservatives.
We could elaborate on the small and medium-size business and on the instability this government has been creating around them for the last six months, but in their case as in the case of other persons, of senior citizens, of pensioners, of businessmen, they will be penalized by the same increases in the cost of transportation, they will be penalized at all levels. Those people are going to remember in the next election.
As my colleague, the hon. member for Broadview-Green-wood (Mr. Rae), emphasized, I hope that Social Creditistes will stop propping up this Progressive Conservative government, as they have done in the last six months, and that they will co-operate with us to defeat it in the weeks to come, not only in this House but in their constituencies.
1 also urge the Social Credit leader to remember his past as a great champion of provincial jurisdiction. That same leader, who claimed that the federal government interfered too much in provincial policies, will remember today that several provincial premiers, that of Alberta and even the Quebec finance minister have told this Progressive Conservative government that the excise tax is an unwarranted intervention in provincial jurisdiction. 1 trust the Social Credit leader will remember that when the time comes to vote on the budget and the non-confidence motions.
I trust that, tormented by his support of the Progressive Conservative party, of the right hon. Prime Minister (Mr. Clark), and tortured by the support he gives the Parti Quebe-cois, he will for a change fight for the interests of Quebeckers and quit supporting this Progressive Conservative party as he has done in the last six months.
The Budget-Mr. Dawson
With regard to unemployment, let us look at the performance of the present government. For six months now they have been in power and they keep putting off implementation of their promises which have been changed only to shrink. They keep telling us they are looking into the problem and consulting the provinces. That is all very well, Mr. Speaker, but they should now start to act. Waiting till December to announce the employment programs for the fall, winter and spring is irresponsibility on the part of this government. In fact, we are still waiting because in his budget last night the minister spent only 30 seconds on the problem.
1 trust the Minister of Employment and Immigration (Mr. Atkey) will take the opportunity of his intervention to announce concrete measures for job-creation. The only thing they have managed to do is reduce the Canada Works program, freeze funds for job-training programs, create economic uncertainty which penalizes especially the young, those who in the past were encouraged by the former Liberal government to propose programs for their communities which gave them both a chance to get some experience and earn a little money.
As early as June last, young people were told everywhere in Canada that unfortunately there would be no jobs for them in the civil service because the President of the Treasury Board (Mr. Stevens) had decided to stop making jobs available especially to young people, women and Francophones. Those young people, Mr. Speaker, even if they have graduated from college or university during the past six months cannot plan a career in the civil service due to the drastic steps taken by the Progressive Conservative party which are based on Progressive Conservative dogma no longer consistent with the policies of 1979.
In addition, these same young people cannot hope to find a job on the labour market, as we can see from the figures published last month. These show that two-thirds of the newly unemployed in October were young people under 25 and that only one-third of all new workers were young people. There is therefore a gap and it is increasing steadily; it has increased by 25,000 for men between 15 and 24, by 18,000 for women 25 or more and by 4,000 for women between 15 and 24, which means that 22,000 people more have been forced into unemployment by this Conservative government, and that less than one-third of the new jobs went to young people.
This is the first increase in unemployment in over one year and it reflects the difference in the programs of the previous government and those of the new government. Mr. Speaker, it would be appropriate to underline the contempt that this new government has shown towards the House, as exemplified by the actions of the Minister of Employment and Immigration. Last month, the hon. member for Blainville-Deux-Montagnes (Mr. Fox), the hon. member for Manicouagan (Mr. Maltais) and myself asked the Prime Minister and the Minister of Employment and Immigration to give us details about job creation. They replied that no details would be made public

December 12, 1979
The Budget-Mr. Dawson
before the budget speech last evening. Mr. Speaker, 1 could quote the right hon. Prime Minister who said that if we wanted answers concerning the budget, we would have to wait until after the minister made his budget speech. He said the following:
Mr. Speaker, I can repeat for the information of the hon. member that a job creation program aimed at providing job experience for young Canadians will be included in the budget.
This took 30 seconds, Mr. Speaker, and two paragraphs over 25 pages. 1 do not believe that this can be considered as fulfilling the promises or commitments made by the government. That same week, Mr. Speaker, before the Standing Committee on Labour, Manpower and Immigration, the Minister of Employment and Immigration announced that the budget would contain concrete measures, but without giving any details. The next day, he spoke before the Canadian Club in Toronto and gave them scoops on some details he refused to give us as members of Parliament, he refused to give to this House and the committee. That kind of arrogance will destroy the government.
In that budget the minister tried to get rid of the problem by passing it on to private industry, or by blaming rising unemployment on the population explosion. Mr. Speaker, I see no reason why an increase in the population growth rate should penalize the young. It is my view that young people born in times of high birth rate have a right to work as much as those who were born in times of low birth rate.
Mr. Speaker, the same minister announced a program for the placement of 105,000 young Canadians by March 1981. In his budget he repeated this last night, but he brought no concrete measure that could show us he is going to achieve this. All we know is that they reduced the Canada Works projects, they froze the manpower training budgets. In that statement he tried to pass the buck once more by suggesting this will require total co-operation from private industry. What the minister is ignoring is that private industry is waiting for government leadership and this has not yet been forthcoming from this government.
It is wishful thinking to imagine that the tax credit programs will solve every problem, because there must be a tax liability in order to receive credits, and under the current conditions many companies do not pay tax. Where are the programs to help municipalities and co-operatives that do not pay tax, companies that do not have enough money, that do not make enough profits to pay tax, Mr. Speaker? We find nothing in the minister's proposals that could be of help to them.
Since I represent a riding with one university and five colleges, and 56 per cent of the unemployed in my riding are between the ages of 17 and 25, I must say that it is a subject of interest for me. I would not pretend to have found some

miracle solution to a problem which plagues the economy of the whole western world. But I would say that it is our duty to do the utmost to "sensibilize" and to convince the government that we must make a supplementary effort if we are to heal this unacceptable situation.
As I mentioned before, we are not the only country to be faced with this situation. Hon. members surely know that youth unemployment in all countries is higher than the national average in each country. But for reasons I have yet to discover, whether they be historical, economical, seasonal or what, Canadian youth are, or at least seem to be, harder affected than the youth in other countries. We have statistics on that. In 1976 there was a 10 per cent unemployment rate for youth in Canada, and it was half that amount in most European countries. Those are the figures of the O.E.C.D. It is even more dramatic in the part of the country I represent which is French. They do not have the same possibility as those in the rest of Canada, the same possibility to pick up their belongings and move away, leave their province or leave their country. That is because of the linguistic situation which does not always guarantee the Francophone his rights all across the country.

In Quebec's case, the difference in language and culture limits the mobility of young people towards provinces offering more job opportunities. Statistics show a lower mobility rate for all Quebeckers. The most recent figures unfortunately date back to the 1966 to 1970 period. The study from which these statistics are taken points to the difference in language and culture as one of the causes for the lower mobility rate.
Thus Ontario, where the unemployment rate is lower, has a higher mobility rate than Quebec even though its net migration is positive. The same study points to the high proportion of young people among the migrants and the importance of economic reasons in the migration phenomenon. Therefore, the difference in language and culture keeps the unemployment problem among young people in Quebec at a higher level than would otherwise be the case.

Some technocrats in our present government and in past governments have found many reasons which explain our present predicament, such as the lack of effective bridges between the world of school and the world of work; the baby boom, or the demographic aspect of Canada; the general weakening of our economic situation and the structural factor of our labour market. These reasons might be acceptable to technocrats and government officials, but I do not think they are acceptable to Canadian youth and Canadian politicians. They cannot explain the fact that as long as 15 years ago youth unemployment was 1.7 times higher than adult unemployment.
Youth unemployment is not the difficulty of a splinter group or minority. At present there are 2.5 million to 3 million young people under the age of 25 in a labour force of ten million people. Since 1966 the number of young people unemployed
December 12, 1979

has tripled, to more than 400,000, and the youth unemployment rate has more than doubled to 13.1 per cent in October.
Figures given out by the Economic Council of Canada are not more encouraging. In 1960 the youth unemployment rate was 1.7 times higher than the adult rate. By 1970 it had climbed up to 2.3 times the adult rate. In 1976 it was 2.5 times the adult unemployment rate. Now it is three times that, three times the unemployed rate in the regular work force. Technocrats can probably find the reasons for it, but that does not make it more acceptable for those young people who are unemployed.
But we also have to give the other side of the medal. It is a known fact that youth unemployment causes a company to make major investments. When an employer hires a group of youths, it is a fact that there is an expense cost for him in developing skills training programs. A high rate of turnover in youth is often a major factor which might make an employer hesitate. Also it is a fact that many young people at least seem to be less productive at the beginning of their careers than the rest of the labour market. But I think it is the responsibility of the government to try to minimize these effects, and the Liberal government was doing that already.
1 can talk about the different kinds of youth unemployment programs. For the last few years the Liberal government set up a special Canada Manpower centre for youth co-operation and education programs which were joint federal-provincial initiatives to encourage the development of co-operative and work experience programs in order to facilitate the transition of young people from school and their integration into the labour
The Budget-Mr. Dawson
force. Canada Manpower centres on campus play a positive role but there are jurisdictional federal-provincial conflicts. Job exploration and job experience training programs were designed to provide secondary school students with opportunity, based on exposure to the unemployment market, to make an informed and realistic career decision as to whether to continue with the in-school education process or to enter the labour force market on a permanent basis.
Following that, the Liberal government set up the Student Summer Employment and Activities program, Canada Manpower Centres for Students, the Young Canada Works program and the Summer Job Corps. These programs all have budgets which have increased in the last few years. The rise in youth unemployment must be kept to a minimum. We are hoping that the present government will continue those types of programs, not only for now, but for next summer. Also we are hoping that even though they waited for the month of December to announce programs for the creation of jobs for the winter and the spring, they will not wait until the month of July to do the same thing for the summer and fall.


An hon. Member:: They probably will not be here.


Dennis Dawson: As the hon. member behind me said, probably they will not be here then. 1 hope we, as a Liberal government, will be over there trying to create those jobs.
May I call it six o'clock?


Mr. Deputy Speaker:: It being six o'clock, the House stands adjourned until tomorrow at 2 p.m., pursuant to Standing Order 2(1).
At six o'clock the House adjourned, without question put, pursuant to Standing Order.

Thursday, December 13, 1979