1979-02-26

ROUTINE PROCEEDINGS


Mr. Andy Hogan (Cape Breton-East Richmond):: Mr. Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgency and with a great deal of sorrow.
I ask through you, sir, seconded by the Minister of Regional Economic Expansion (Mr. Lessard):
That the members of the House of Commons extend to the families of the men killed in the coal mine accident at No. 26 Colliery, in the town of Glace Bay, Nova Scotia, on Saturday, February 24, 1979, their deepest sympathy in this tragic moment of their lives and express the hope that the surviving miners will pull through their terrible ordeal.


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


Some hon. Members:: Agreed.


Mr. Speaker:: The House has heard the terms of the motion moved by Mr. Hogan and seconded by Mr. Lessard. Is it the pleasure of the House to adopt the motion?


[Stage Direction]
Motion agreed to.

Mr. J. R. Ellis (Hastings):: Mr. Speaker, under Standing Order 43, I move, seconded by the hon. member for Prince Edward-Hastings (Mr. Hees):
That this House request the Liberal party to pay the $4,000 plus that it cost the taxpayers to transport six members of the Liberal caucus, namely, the hon. member for Peterborough, the hon. member for Windsor-Walkerville, the hon. member for York South and the hon. member for Peel-Dufferin-Simcoe, in a Department of Transport executive Viscount aircraft and have a full crew standing by all day today so that those members can spread political propaganda liberally in that area, it being particularly a waste of time since the good people
of Prince Edward and Hastings counties are not in any way taken in by such nonsense.


Mr. Speaker:: Is there unanimous consent for the introduction of the motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


PUBLIC WORKS
Mrs. Jean E. Pigott (Ottawa-Carleton):: Mr. Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity.
Because there has been the allegation of external pressure in the dispute between the National Capital Commission and Phillipe St-Cyr, the owner of Le Diplomate, and 21 witnesses' have been named, including the Minister of State for Urban Affairs and Minister of Public Works, the President of the Treasury Board and the Chairman of the National Capital Commission, I move, seconded by the member for Central Nova (Mr. MacKay):
That the Minister of Public Works rescind the order in council issued giving the federal government permission to occupy Le Diplomate and abide by the court's decision in order that justice both be done, and be seen to be done.


Mr. Speaker:: Introduction of such a motion for debate at this time can be done only with unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


CONSUMER AFFAIRS
Mr. Edward Broadbent (Oshawa-Whitby):: In view of two reports released over the weekend, one by the AIB showing that food prices in 1978 escalated by 21 per cent, the other by Statistics Canada showing that the average weekly wage increased by only 6.4 per cent, meaning, with a 9 per cent increase in the cost of living, a decrease of $340 for the year in

February 26, 1979
purchasing power, I move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House calls upon the government to bring in measures to restrain rising prices and, furthermore, urges specifically the reinstatement of federal subsidies on bread and milk to alleviate the burden of food costs faced by Canadian families.


Mr. Speaker:: Introduction of such a motion for debate at this time can be done only with unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


AGRICULTURE
Mr. Jake Epp (Provencher):: Mr. Speaker, I rise under the provisions of Standing Order 43.
In view of the statements made on February 15 by the Minister of Agriculture that bacteria infected feed from Manitoba caused a salmonella outbreak in Quebec, and in view of the fact that tests now concluded have proven that the infected feed did not originate in Manitoba, but in Quebec, and in view of the fact that these statements of the minister are damaging the reputation of Manitoba's feed industry. I move, seconded by the hon. member for Lisgar (Mr. Murta):
That the Minister of Agriculture retract his unfounded statements and extend apologies to the members of Manitoba's agricultural community.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


REQUEST FOR GOVERNMENT MEASURES TO PREVENT OIL SHORTAGE IN QUEBEC-MOTION UNDER S.O. 43
Mr. Jacques Lavoie (Hochelaga):: Mr. Speaker, I rise under Standing Order 43 to ask for the unanimous consent of the House to present a motion regarding an urgent and important matter.
In view of the fact that oil companies have exported refined oil and that Esso has diverted to the American market oil

which was intended for Canada, I move, seconded by the hon. member for Mercier (Mr. Boulanger):
That the Minister of Energy, Mines and Resources take appropriate action so that Quebeckers not be deprived of oil.


Mr. Speaker:: Order, please. The House has heard the terms of the hon. member's motion. Under Standing Order 43, this motion cannot be presented at this time without unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


NATIONAL REVENUE
Mr. G. H. Whittaker (Okanagan Boundary):: Mr. Speaker,
I rise on a matter of urgent and pressing necessity, under the provisions of Standing Order 43, involving the security and confidentiality of tax and statistical data supplied by Canadians in trust to their government.
Since it has been demonstrated that tax and statistical information has been left open to public inspection, and that the responsibility rests with the cabinet and particularly with the departments of National Revenue and Industry, Trade and Commerce, I move, seconded by the hon. member for Central Nova (Mr. MacKay):
That the tax and other forms be examined by qualified officers to ascertain how many Canadians were affected by having their forms left under such carelessly exposed conditions and notified so that they are made aware of the situation in case any complications occur from unauthorized access to the information on their returns.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


SHIPBUILDING
Mr. Gus Mitges (Grey-Simcoe):: Mr. Speaker, I rise under the provisions of Standing Order 43.
In view of the fact that in the government's recently announced program to assist the lagging shipbuilding industry in Canada, it is quite evident that most of this assistance is slated for the east and west coast shipbuilding industries to the almost complete disregard of the shipbuilding industries in the
February 26, 1979

Great Lakes area, I move, seconded by the hon. member for Hamilton-Wentworth (Mr. Scott):
That the government take immediate steps to correct this injustice and that applications for assistance from the shipbuilding industries on our Great Lakes be given the same earnest consideration and the same priorities as those from the shipbuilding yards on our coasts.


Mr. Speaker:: In accordance with the provisions of Standing Order 43, presentation of such a motion for debate at this time requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


PRESENCE IN GALLERY OF SPEAKER OF THE LEGISLATIVE ASSEMBLY OF THE STATE OF VICTORIA, AUSTRALIA, SIR KENNETH WHEELER AND CHINESE TRADE DELEGATION HEADED BY ZHANG JIAN HUA
Mr. Speaker:: Before beginning the question period, may I ask hon. members to join with me in welcoming in the Speaker's Gallery two distinguished visitors, first, the Speaker of the Legislative Assembly of the State of Victoria, Australia, Sir Kenneth Wheeler.


Some hon. Members:: Hear, hear!


Mr. Speaker:: Second, a Chinese delegation here to sign a three-year wheat agreement, which is headed by Zhang Jian Hua.


Some hon. Members:: Hear, hear!



ORAL QUESTION PERIOD


Mr. John C. Crosbie (St. John's West):: Mr. Speaker, in the absence of the Prime Minister and the Minister of Industry, Trade and Commerce-who are probably discussing whether the Prime Minister was sinful or not by going south-I have a question for the president of the economic board of refugees.
First, I want to know whether the minister has examined the study "Forging the Links," of the Science Council of Canada. If so, does he have a comment on the situation they describe on page 17 "as a massive failure of the country's industrial system", that imports have grown from 26 per cent to 31 per
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cent of our Canadian market-that imports grew to 31 per cent up to 1977-and our exports are declining relatively, and that we are moving from an industrialized economy to one based on the export of raw materials?
Has the minister studied this report? Did he read it before he stated and came to the decision that Canada should have no coherent industrial strategy which the Science Council of Canada recommends?


Hon. Robert K. Andras (President of the Board of Economic Development Ministers):: Mr. Speaker, the hon. member is, again, making distortions out of any comments I made. Yes, the report to which he referred is a matter of very important significance to the government. It is being studied most carefully.
With regard to the question of imports, the hon. member might be interested to know that in the last two years the growth of import penetration in Canada is the smallest of 11 OECD countries, which is a source of some comfort to us.
With regard to the development of industrial strategies, we have been, and will continue to be, diligent in working toward that end.


John Carnell Crosbie: I realize the minister is being diligent, Mr. Speaker, but he has not come up with any industrial strategies that the Science Council of Canada know about. The Prime Minister said to help him, he is in trouble, but we want Canada helped because Canada is in trouble as a result of this ten years of inaction.
Would the minister comment on page 24 of the report where the Science Council deals with the question of invisible trade, items such as transport services, tourism, investment income and payment on the debt which has risen, by the way, from $1.5 billion in interest on our foreign debt to $4.8 billion which is estimated this year-and it will be worse in the future. They state that of 25 industrial countries, Canada is twenty-fifth in the contribution of invisible trade items to our trade account.
Will the minister tell the House whether he has now developed any strategy in dealing with this desparate situation, other than the strategy of borrowing $8 billion or $9 billion abroad to add to that tremendous deficit? What is his strategy for dealing with this?


Hon. Jean Chretien (Minister of Finance):: Mr. Speaker, I think the hon. member is referring to the deficit in the current account. I have, of course, said that we have a current account deficit that is quite significant in Canada. Traditionally, we have opted for investment from abroad.
Canada is a country that has been developing over the past 110 years through borrowing from abroad. We are, in fact, a developing nation with a lot of infrastructure to put in place. It has been traditional for Canada to borrow abroad. Therefore, that is what we are doing at this time. I think this policy has served Canada very well for a long time.


John Carnell Crosbie: Mr. Speaker, the minister has not answered my question. I will ask his deskmate, the President of the

February 26, 1979
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Board of Economic Development Ministers-who is now supposed to head this area-what specific policies the government is developing to overcome this tremendous deficit on the invisible trade account, particularly in view of the fact that the study has found that in the sectors of our manufacturing which utilize high technology, we are in a very serious deficit situation and our surplus in exports is really from raw materials and crude and processed resource material.
In view of this, what are the minister's promises? His deskmate is borrowing billions more abroad and there will be very much higher interest payments. How is the minister going to overcome that on the trade surplus or the surplus side of our international balance of accounts? If not, the Canadian dollar is doomed to even worse decreases. What is his answer to this?


Robert Knight Andras: Mr. Speaker, one of the greatest dangers to the Canadian dollar is spurious comments like that of the hon. member and some of his colleagues. There is a great deal of encouragement to be taken from the increase in our export merchandise trade balance which will reach $3.5 billion this year with every sign, over and above the advantage the Canadian dollar gives us for exports these days, of a vast improvement in the competitive position of Canadian manufacturing. That fact is well known to the manufacturing industry and is a matter of their comments in recent consultations and public statements by them.
I really believe the hon. member would serve the country much better if he would give some kind of hope based on facts that are well known and well established. If he wants to deal in facts of three or four years ago and peddle those across the country, he is not encouraging optimism or investor confidence in this country.


INTEREST PAID ON NATIONAL DEBT
Mr. Sinclair Stevens (York-Simcoe):: Mr. Speaker, I should also like to direct my question to the minister in charge of the BED ministers of this cabinet: it centres on the question of an industrial strategy.
Does the minister agree with his counterpart, the President of the Treasury Board, that it is not the quantum of national debt that worries him but, rather, the amount of interest we are paying on it? I ask this question bearing in mind that just before this government took power, the total interest portion of the national budget was about 9 per cent, compared to 16.5 per cent now.


Joseph Jacques Jean Chrétien: Mr. Speaker, this question was handled by the President of the Treasury Board quite efficiently last week when he explained to Canadians that, of course, we have a large debt in Canada but that in relation to what the debt was in 1962 in terms of percentage of gross national product, the proportion of Canadian debt at this time has dropped from 30 per cent to 23 per cent, and that is a good achievement.
[Mr. Crosbic.J


Sinclair McKnight Stevens: Mr. Speaker, if the minister in charge of the BED ministers does not wish to reply, perhaps I could put my supplementary question to the Minister of Finance, the minister who has attempted to justify the $62 billion net debt of this country at the present time.
Following the pattern set in the United States and in the United Kingdom, will the minister give us a five-year overview in relation to expenditure and revenue figures in Canada with a view to establishing what, in fact, will be the borrowing needs of this government this year and for the ensuing four years, bearing in mind that Wood Gundy points out that the total borrowing requirement of this government for this year and the next four years will amount to $55 billion?
I would like the minister first to indicate whether he confirms this five-year forecast and, second, will he confirm that $55 billion is, in fact, the amount the government will likely be borrowing if its plans are carried out?


Joseph Jacques Jean Chrétien: Mr. Speaker, each year we table before the House a budget which includes the government's expenditures and revenue. We are fully aware that the service of our debt is presently quite costly and that our requirements for liquid assets of $10.7 billion are very high. That is why over the last three years we have undertaken to cut back our expenses, and I am certain that the hon. member will agree with me that our deficit should not increase; also I hope that he will not endorse the statements made by his leader who has gone across Canada recommending tax cuts that would increase the deficit by $6 to $7 billion next year.


CONSUMER AFFAIRS
John Edward Broadbent: Mr. Speaker, I have a question for the Minister of Consumer and Corporate Affairs.
On the weekend, the Anti-Inflation Board produced figures showing that food prices went up a full 21 per cent over last year. In view of the fact that this is the biggest increase in the history of indexing, and considering that this process is continuing day after day, will the minister explain why flour prices-which affect the price of so many food items, including bread-have gone up, according to the same report, by a full 25 per cent in the past two months, when the removal of the federal subsidy should have meant a price increase much lower than that?


Hon. Warren Allmand (Minister of Consumer and Corporate Affairs):: Mr. Speaker, according to the AIB report, the reason for food price increases is, as we have been stating all along, the increase in the price of beef, fresh fruits and vegetables and of bakery products.
February 26, 1979

The increase in the price of fruits and vegetables in part is due to the difference in the value of our dollar and the American dollar, particularly during the winter when these commodities are imported. The increase in the price of beef, as is well known, relates to the beef cycle. We have been trying to encourage people to move to alternatives to beef, especially pork, the price of which has been very good in recent weeks.
On the question of flour and bakery products, we estimated that the removal of the subsidy should result in an additional cost of seven cents on a standard loaf of bread. I have not been able to analyse the figures with respect to flour. I think the hon. member referred to bakery flour, and I would have to analyse the figures which he gave and of which I have not had notice. However, I will be pleased to do that and get back to him.


John Edward Broadbent: Mr. Speaker, as usual, the minister is going to set up another study to investigate some price increase. It would be nice for him to come to the House just for once having conducted an investigation of the matter about which he is almost certain to be asked.
The Anti-Inflation Board also confirmed at the weekend that chicken retail prices went up some 35 per cent in the past year, more than twice as much as the farmer received. Since this question was raised with the minister in the House by one of my colleagues more than a week ago, will he now confirm that in the case of chicken prices the middlemen simply increased their profits on chickens by increasing chicken prices to correspond with beef price increases, even though there were not real increases in the cost of chicken production to correspond with increases in the cost of producing beef?
If there is profiteering in this area-and all the evidence seems to indicate that there is-will the minister do something such as rolling back price increases for chicken?


William Warren Allmand: Mr. Speaker, it is very easy for the hon. member to come to the House every day to ask questions without giving notice. I have pages and pages of briefing here on food price increases, but the hon. member always manages to come up with some obscure question.


Some hon. Members:: Oh, oh!


William Warren Allmand: Almost any fool can put a question in the House, but a worth-while answer requires some analysis of statistics. The hon. member puts questions, not to gain information but merely to embarrass.
On the hon. member's question with respect to chickens, there is no doubt that the price of chicken and poultry has increased following the phenomenal rise in beef prices. Because there has been a shift to alternative sources of protein, demand is greater than supply and under market conditions the price of chicken will increase.
As the hon. member knows, there are marketing boards for chicken and turkey, and we hope measures will be taken to
Oral Questions
increase quotas for those two items so that there will be a greater supply and, therefore, a lowering of prices.


John Edward Broadbent: Mr. Speaker, not just any fool would give that answer; it takes a particular fool on the government side.


Some hon. Members:: Oh, oh!


John Edward Broadbent: If the minister considers a question about chicken prices to be obscure, I would like him to go out into the streets of Ottawa and talk to typical housewives and ask them if the question is obscure. The minister has had notice of that question for more than a week. He was asked this same question. He has produced no answers. It is very clear-


Some hon. Members:: Order.


Mr. Speaker:: Order, please. The hon. member realizes that I consistently extend to him the opportunity to ask questions at the beginning of every day. However, he now seeks an opportunity on a final supplementary both to ask a question and to make an argument. Now I suppose the hon. member seeks to put another question. He should get to it very directly.


John Edward Broadbent: Mr. Speaker, I will come to the question. Considering that for more than three weeks the minister has not brought about one rollback in price increases, will he now honestly state to hon. members on this side of the House as well as to the people of Canada that the government has absolutely no intention of doing anything about escalating prices in any sector of the economy?


William Warren Allmand: Mr. Speaker, the hon. member says he gave me notice about flour prices. He did not. The notice I received was with regard to a question about bread prices. There are many aspects of the milling industry about which one could put questions and it is impossible to have all the statistics and figures here in the question period without notice.
The hon. member knows that with the phasing-out of the AIB there is no power in the government to roll back prices. There may be measures which could be taken to moderate price increases, and the government is considering measures which might do that, but we have no rollback power. The hon. member knows that, and he opposed that. Furthermore, he puts forward very facile suggestions for action without even considering what fallout there would be on many other sectors of the Canadian economy.


THE CANADIAN ECONOMY
Right Hon. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, I listened to the Minister of Finance a moment ago going back to 1962, and it impels me to ask him, as Minister of Finance in a totally bankrupt government, a question. Today, the deficit is approximately $11,000 million because of a

February 26, 1979
Oral Questions
government which had engaged in squander-mania all across the board. That amount had to be borrowed and it is costing the Canadian people $5 million a day in interest.
I would like the minister to explain that and to produce his alibi for a situation which indicates that our country is virtually in a state of bankruptcy.


Some hon. Members:: Oh, oh!


Joseph Jacques Jean Chrétien: Mr. Speaker, as I just said, the ratio between the GNP and the debt in Canada has gone down from 33 per cent in 1962 to 23 per cent today. That is a fact.


Some hon. Members:: Hear, hear!


Joseph Jacques Jean Chrétien: If hon. members do not like me to speak about 1962,1 can go back to 1958, which was worse.


Some hon. Members:: Oh, oh!


John George Diefenbaker: Mr. Speaker, the Minister of Finance has been singularly free of questions on my part during the session even though I have listened to his obvious alibis. I ask him to answer this question: Is it not a fact that today it costs the Canadian people, because of the squander-mania and the waste of this government causing a deficit of SI 1,000 million, $5 million a day in interest?


Joseph Jacques Jean Chrétien: I think that the borrowing of this government abroad is not more expensive than borrowing inside Canada. As the right hon. member knows, when we borrow for exchange purposes this money goes into the fund and is reinvested in U.S. government securities. On some days the cost of the money we borrow is no more than the revenue we are receiving. Last week I gave the committee a letter about this. I will make sure that the hon. member receives a copy of it. He can read it and he will have good reason not to ask me any more questions.


Some hon. Members:: Hear, hear!


John George Diefenbaker: Why does the minister not answer the question? I produced the truth, and he is afraid to admit it.


ADMINISTRATION OF JUSTICE
Mr. Adrien Lambert (Bellechasse):: Mr. Speaker, my question is directed to the Minister of Justice. Since the beginning of this session, I have been intrigued by the sight, at the west door of parliament, of a person walking about holding a sign. As that sign was unilingual, I could not make out too well what was written on it. Last week I went to the person and asked her: Are we not in a bilingual country: why could your

sign not be bilingual? The next day I had the pleasant surprise of seeing that it was bilingual. I could then better understand her claims. I should like to ask the Minister of Justice whether, in that capacity, he would be willing, or has already done so, to look into the claims of that person who is still there despite the very cold weather and whether he could tell us very frankly after having met her what the position of the government is with regard to her situation and, if she has certain rights, how he could help her to make herself heard democratically in order to settle that matter once and for all?


Hon. Marc Lalonde (Minister of Justice):: Mr. Speaker, I thank the hon. member for his question. I have had the opportunity of speaking with the person concerned, to have her explain the situation; I have also had some of the civil servants in my department look into the situation brought to our attention by that lady. Unfortunately, I must tell the hon. member that this person is complaining about the decision brought down by the Quebec Court of Appeal confirming the judgment of the Quebec Superior Court. As the right hon. Prime Minister mentioned in the House last week or two weeks ago, I believe, our examination of the case has shown that there is nothing we can do as a government. The case resulted from a matter under municipal jurisdiction, more specifically that of the city of Hull; we must respect the decisions of the courts just like any other Canadian citizen is expected to do. So, despite my conversations with that lady and our examination of the case, I feel there is nothing we can do as a government because to do otherwise would be tantamount to intervening in the decisions of our tribunals. I doubt that anyone in this House would like to see the government embark on that course of action.


HUMAN RIGHTS
Joseph Adrien Henri Lambert: Mr. Speaker, I should like to put a supplementary question. It has already been widely reported that a federal ombudsman, such as the one in Quebec and in Ontario, would be appointed and very recently the Ontario government asked parliament to pass special legislation to enable a judge to fill that post. Is the minister prepared to tell the House whether the government still intends to introduce such legislation so that the matter could be considered not at a ministerial level but at the ombudsman level, so as not to lead other countries to believe that we are not well disposed towards the individuals who make demands that come under different jurisdictions?


Marc Lalonde: Mr. Speaker, the government still intends to introduce such a bill. However I would like to remind hon. members of two things. In the
February 26, 1979

first place, concerning complaints of citizens about administration of justice, as in the present case, the complaint would not have to be filed with the ombudsman but with the Canadian Judicial Council which, as far as I know, has considered the matter and found that there was no ground for complaint. As for the other aspect, if that lady is complaining about a municipal regulation, it is obvious that her complaint should be filed with the Quebec ombudsman rather than with a federal ombudsman who would not have the necessary authority to intervene in such decision.


COMMUNICATIONS
Jacques Lavoie: Mr. Speaker, my question is directed to the Minister of Communications. Considering that the broadcasting of the debates by cable TV companies such as the Montreal based National Cablevision is very late, which prevents many citizens from participating or becoming acquainted with what happens here in the House of Commons, can the Minister of Communications tell the House whether some move is being considered or whether communications to those companies are needed to be able to broadcast those debates earlier, like those of the National Assembly, to enable as many citizens as possible to follow them?


Hon. Jeanne Sauve (Minister of Communications):: Mr. Speaker, at the present time the debates of the House of Commons are broadcast mainly on community channels, and only people in the Ottawa area have direct access to the live broadcasting of those debates. As for the province of Quebec and the debates of the National Assembly, Radio-Quebec is responsible for that broadcast. Consequently it has the choice to have a live broadcast in some areas of Quebec. As far as our debates are concerned, we can only have a pre-recorded broadcast outside the Ottawa area. The problem is quite different in a large country like ours but CBC is taking steps to broadcast the debates by satellite. On their side, cable TV companies are taking steps to broadcast the debates and in a few days, a workshop will be held to try to come up with a package which could be programmed by satellite, which would enable a larger number of people to see a live broadcast of the debates.


GOVERNMENT POLICY ON EARTH STATION SATELLITES-DATE OF ANNOUNCEMENT
Mr. J. P. Nowlan (Annapolis Valley):: Mr. Speaker, in view of the fact that one of the problems is completion of the discussions on how to televise live the proceedings of the House of Commons, when will the long delayed announcement of the minister on the earth station satellite receiving policy be made, which will overcome some of the hurdles; or is she waiting
Oral Questions
until the select committee makes its report, which was scheduled for the end of this month?


Jeanne Sauvé: No, the
ownership policy on earth stations has been under review now for a year. 1 am due to announce my conclusions of that review very, very soon.


CANADIAN BROADCASTING CORPORATION
John Patrick (Pat) Nowlan: Mr. Speaker, my supplementary question is directed to the Secretary of State: it involves television in the House of Commons.
In view of the fact there have been negotiations between the cable industry and the Canadian Broadcasting Corporation combining an earth station satellite review policy, which the minister will announce in a few days, is the minister aware the CBC has declared an intention to purchase 100 frontier type earth receiving stations to attach to the head-ends of cable companies without their consent at the moment?
If the minister is aware of this, can he indicate what cost factor is involved, in view of the fact we understand there has been certain restraint in CBC moneys and that this could have been done at no charge to the public purse by the sole initiative of cable companies?


Hon. John Roberts (Secretary of State):: Mr. Speaker, I have had discussions with the corporation concerning the possibility of extending the coverage of the broadcasting of the House. The specific proposal suggested by the hon. member has not been brought to my attention, if indeed it is true. I will examine with the CBC whether in fact that is the case.


LABOUR CONDITIONS
Mr. Robert Muir (Cape Breton-The Sydneys):: Mr. Speaker, my question is directed to the Minister of Labour under whose jurisdiction comes mine safety in the Cape Breton Development Corporation.
I was not present in the chamber when the motion under Standing Order 43 was made, but I am sure we all reiterate the sincere sympathy to the survivors of the ten men who lost their lives and our deepest prayers go out to those who have gone through such a horrible, horrible experience. I thank the minister for sending his preliminary report. Is the minister in a position to provide any further information to the House at this time regarding this terrible, terrible tragedy?

February 26, 1979
Oral Questions


Hon. Martin O'Connell (Minister of Labour):: Mr. Speaker, I want to join with the expression of sympathy in the motion under Standing Order 43 moved by the hon. member for Cape Breton-East Richmond and express my sympathy to the families who have suffered the loss or severe injury of loved ones in that tragic accident.
Today I appointed Mr. Roy Elfstrom, the director of the occupational safety and health branch of my department, as a commissioner with powers under the Inquiries Act to do an immediate on-the-spot investigation into the causes of the accident so far as they can be determined. Already a preliminary investigation is under way which is being conducted on a tripartite basis, that is, safety officers from Labour Canada who are in Sydney all the time, members of the unions involved, and of the company.
I felt it was necessary to make a second inquiry in order to secure all physical evidence and if necessary all testimony under oath before physical evidence changes or people's memories slip. Also, I am giving consideration, although I have not reached a decision, to appointing a public inquiry should that seem to be necessary.


PUBLIC SERVICE
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, my question is directed to the President of the Treasury Board. In view of the fact the government preaches restraint, especially for ordinary workers, an example being the fact that some 18,000 low-paid Ontario hospital workers were limited to an average wage increase of approximately $8 a week, how does the government justify the increase for senior public servants ranging around $100 a week, with a new high of $78,700 a year?


Hon. Judd Buchanan (President of the Treasury Board):: Mr. Speaker, as the hon. member is aware, the government decided to increase the compensation of senior public servants in Canada based upon a report prepared by an independent group which advised the government on this. As a matter of fact, its recommendations were in excess of the figure decided upon by the government.
The 7 per cent increase leaves us with a very significant compression problem as far as incomes are concerned within the public service. But we felt it should be held to that amount at this time because that is roughly the figure many settlements came in at within the public service.


Stanley Howard Knowles: Mr. Speaker, I will not comment upon the attempt to pass the buck back to that advisory group; after all, it is the government which makes the decision.


An hon. Member:: Hear, hear!
[Mr. Muir.l


Stanley Howard Knowles: In view of the fact that references to the consumer price index were made both in the report of the Lambert advisory group and in the minister's statement, and if these increases are to enable persons to keep up with the cost of living, is it not about time to consider those who have to struggle with the cost of living, and not those who are making $40,000, $50,000 or $60,000 a year? Will the government give some leadership, and not just preach restraint which amounts to sheer hypocrisy?


J. Judd Buchanan: Mr. Speaker, as the hon. member has pointed out, the recommendations of the advisory committee report were of the order of 7.5 per cent and 8 per cent. It was felt those should be cut back to the range of 7 per cent.


An hon. Member:: Big deal.


J. Judd Buchanan: If hon. members are now starting a new approach, that we should not use percentages, that we should use absolute dollars-


John Edward Broadbent: Good idea.


J. Judd Buchanan: Well, it is a totally new concept. I suggest hon. members might go out and advocate it to some of their union supporters, to see how vigorous the support would be from them.


An hon. Member:: That is right.


CONSUMER AFFAIRS
Mr. James A. McGrath (St. John's East):: Mr. Speaker, my question is supplementary to the one raised by the hon. member for Oshawa-Whitby. Last Friday, outside the House, the Minister of Consumer and Corporate Affairs referred to a food policy which was about to be announced by the government. He said that we could expect an announcement today, although it would not come from him.
In light of the 21 per cent over-all annual rate of increase in the price of food identified by the AIB, and the justifiable concern about this matter, can the minister tell the House who in the government is responsible for food policy and when we can expect the announcement to which he referred outside the House on Friday?


William Warren Allmand: Mr. Speaker, the story in the press was completely false. At no time did I say that there would be an announcement this week or any other week, although I was pressed by a reporter, or several reporters, to do so; and I cannot tell the hon. member now.
I have told the hon. member on several occasions that there are several departments involved in food policies: the Department of Agriculture, the Department of Fisheries and the Environment, the Department of Consumer and Corporate
February 26, 1979

Affairs, the Department of Industry, Trade and Commerce, the Department of National Health and Welfare, and there are many provincial departments of agriculture, fisheries and consumer affairs. But the answers to the problems of high food prices are not as simple as many hon. members would suggest.


JUSTIFICATION FOR INCREASE IN PRICE OF CHICKEN
James Aloysius McGrath: Mr. Speaker, my question is directed to the Minister of Agriculture, who seems to have something to say in the area of food policy.


An hon. Member:: Not much.


James Aloysius McGrath: If an announcement on a new food strategy for the government is made, will the Minister of Agriculture be responsible for that food strategy?
While I am on my feet, perhaps I can ask the minister if there is any shortfall in the supply of chicken which has been identified by AIB as one of the contributing factors because of the decrease in the demand for beef. If there is no shortage of supply, perhaps the minister can tell the House how he justifies the increase in the price of chicken.


Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, the statistics and facts I have been given show that there are some four million pounds more poultry in storage now than a year ago, and some five million pounds more beef and pork. There has been an increase in the production of turkey, and turkey has gone down in price by 2.8 per cent. The hon. member did not mention that. The hon. member hollered like hell about how much turkey there was-


Stanley Howard Knowles: Order.


Eugene Whelan: Mr. Speaker, I apologize. He hollered like everything about how much the shortage of turkeys would be, and we ended up with approximately 20 million pounds of turkey surplus after the first of the year. The program for food policies was stated quite clearly by my colleague.


PUBLISHING
Mr. David MacDonald (Egmont):: Mr. Speaker, my question is addressed to the Minister of National Revenue. It relates to the considerable concern and reaction in the book publishing industry with respect to a recent decision by his department to establish a new zero-rate tariff on imported books.
In view of this major decision which was taken by National Revenue earlier this year, and its impact upon Canadian book publishing, I wonder if the minister could indicate what kind of consultation took place with the book publishing industry,
Oral Questions
and what kind of advance notice was given prior to the introduction of this new zero-rating for the next three-year period.


Hon. A. C. Abbott (Minister of National Revenue and Minister of State (Small Business)):: Mr. Speaker, I have read the article and some surrounding data about the reduction of the rate to zero, and I gather that this has been a long-sought reform by the publishing industry.
As the hon. member perhaps is aware, changes in duties and rates are carried out by my department but the policy is directed by the Minister of Finance I assume that this has been a step which has been sought for some time by the international publishing community.


David Samuel Horne MacDonald: Mr. Speaker, I am sorry that the minister is not better informed on this particular subject, otherwise he would be aware of the comprehensive policy that was forwarded to the government late in 1977. I am sure that the Secretary of State for External Affairs or the Secretary of State is aware of this.
Would one of those ministers, or the Minister of Finance, indicate to the House why only one element of that policy was introduced, why there was no zero-based year attached to the policy, why it excludes the whole question of the importation of fine paper and material used in book publishing and why, in effect, there was no final consultation or notification to the publishing industry, inasmuch as all segments of publishing and the book industry at the retail level, as well as authors, have protested the government's recent action in this regard?
Perhaps the Secretary of State is the best informed in terms of the health of the Canadian book publishing industry.


John (Moody) Roberts: Mr. Speaker, I am sorry that the hon. member terminated his question that way, because up to that point he had been rather sensible.
Indeed there have been extensive discussions with the industry about these changes, particularly in the context of accession to the Florence agreement. The decision was not to attach ourselves to the Florence agreement but go to a zero-based tariff item for three years over which we would assess its possible consequences. There have been extensive discussions and consultations with the industry and, contrary to the hon. member's suggestion, the industry is by no means unanimous in its rejection of such a move. There is division within the industry as to whether this step would be favourable or not.
We have taken this decision, not in isolation but in the context of other measures which I hope to be able to announce soon.

February 26, 1979
Oral Questions ENERGY


SECURITY OF OIL SUPPLY FOR EASTERN CANADA-ROLE OF PETRO-CANADA
Mr. Maurice Foster (Algoma):: Mr. Speaker, my question is addressed to the Minister of Energy, Mines and Resources.
In view of the need for secure supplies of oil from offshore for eastern Canada, and the reversal of the Tory policy concerning Petro-Canada as indicated over the weekend by the hon. member for Northumberland-Durham and reported in the Toronto Star of yesterday, will the Minister of Energy, Mines and Resources be pressing ahead with additional longterm supply arrangements for imported oil using Petro-Canada as Canada's agent?


Hon. Alastair Gillespie (Minister of Energy, Mines and Resources and Minister of State for Science and Technology):: Mr. Speaker, I am very interested in the change of view by the hon. member for Nothumberland-Durham. I am not sure whether he has checked it out with his leader yet, because his leader is still talking about winding-up and dismantling Petro-Canada.


Miss MacDonald:: Ask Maurice Strong about it.


Alastair William Gillespie: I can assure the hon. member that Petro-Canada is pressing ahead in trying to make a deal and write a contract with Pemex, the national oil company of Mexico. A group of negotiators from Petro-Canada and the Canadian government were in Mexico very recently. 1 can report that they had a very good and very useful discussion, and I believe that it should be possible to sign an agreement with Mexico in the very near future.


GOVERNMENT POLICY ON NATURAL GAS PIPELINE TO QUEBEC AND EASTERN CANADA
Mr. Allan Lawrence (Northumberland-Durham):: Mr. Speaker, my question is also for the Minister of Energy, Mines and Resources. Could the minister tell the House if it is government policy to approve a natural gas pipeline to Quebec and the maritimes, if it is government policy to be against it, or if it is government policy that they are awaiting the recommendation of the National Energy Board?


Alastair William Gillespie: Mr. Speaker, I have made a number of statements in the past indicating that I think it would be highly desirable for a natural gas pipeline to go all the way from the west to the Atlantic Ocean. I hope that that will be possible. I also hope that the economics of this particular submission will be established before the National Energy Board. I expect that the National Energy Board will be addressing itself to this very important question this year.


Allan Frederick Lawrence: Mr. Speaker, if it is already government policy to approve of this, why is the question of whether or not there should be an application to the National Energy Board

one which the government is following? Why is the time and money being spent with respect to the policy decision itself which the National Energy Board is expected to recommend to the government? Why are we going through this rigmarole, if the government has already made up its mind?


Alastair William Gillespie: Mr. Speaker, this is not the first time that the hon. member has not listened to the answer or based his question on an absolutely false premise. If the hon. member had listened very carefully, he would have heard that I said the economics of this matter are very important. The National Energy Board has been set up to examine the submission and the economics of that submission.
 * *


ADMINISTRATION OF JUSTICE
Mr. Eldon M. Woolliams (Calgary North):: Mr. Speaker, I would like to ask a question supplementary to those asked a short time ago by the hon. member for Central Nova, by the hon. member for Bellechasse today, and by the hon. member for Timiskaming in the past, of the Minister of Justice who is a lawyer and knows of the difficulties of trials and the experience of trial lawyers.
In light of the fact that the lady who is protesting outside parliament is a registered nurse, has been out there for two or three months and is actually starving herself in an attempt to bring some heed to her grievances, would the minister now- and I offer this as a plea and suggestion-discuss this matter with the chairman of the Standing Committee on Justice and Legal Affairs and members of the committee on that side of the House so that this lady could come before the committee and set out her grievance, and so a report could be made to the Department of Justice and the government? In this way that person would get a fair hearing. I am sure she would receive a fair hearing from that committee.


Marc Lalonde: Mr. Speaker, the hon. member is a member of the steering committee on justice and legal affairs. I am sure that he could bring his representations directly to that steering committee and to the chairman of the standing committee.
I would repeat that I have seen this lady myself. I have asked the officials in my department to look into her case and it is quite clear that the matter which the lady is protesting about is one of private litigation. The lady is unsatisfied with a judgment rendered by the Superior Court of Quebec and the Court of Appeal of Quebec. She is in the same situation as any private citizen who is not satisifed with a judgment rendered by the courts. There is nothing which the Minister of Justice or the federal government as such can do. In this particular litigation, neither the federal government nor any of its agents were involved, either as a party in the action or as interveners
February 26, 1979

in any way. It is a matter of private litigation under the civil law of Quebec.
Mir. Speaker: The hon. member for Capilano.


Eldon Mattison Woolliams: Mr. Speaker, may I ask one supplementary?


Mr. Speaker:: The hon. member for Calgary North.


Eldon Mattison Woolliams: Mr. Speaker, I am not suggesting-


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order. I do not like to interrupt the hon. member, but I am troubled that we have spent a great deal of time on this matter. There are several other members who, I am sure, have been pressing for several days to be recognized. Perhaps the hon. member could ask a very brief question and then I will recognize the hon. member for Capilano.


Eldon Mattison Woolliams: I am always brief, Mr. Speaker. I would ask the Minister of Justice if he would lend his support. Naturally, I can recommend the matter to the steering committee, but this parliament sets the references for that committee. I am asking the minister to lend his support in this matter.


Marc Lalonde: Mr. Speaker, I think that if the hon. member had listened to my first answer, I said everything that I needed to say on the subject.


CANADIAN BROADCASTING CORPORATION
Mr. Ron Huntington (Capilano):: Mr. Speaker, I have a question for the Secretary of State. Would the Secretary of State tell the House if he has approved the issuance of credit cards with major department stores in the name of and to the account of Canadian Broadcasting Corporation, and can he advise us as to the extent of such issuance?


John (Moody) Roberts: Mr. Speaker, I have not personally done so. It may be within the delegation of signing authority that that has taken place, but I personally have not done so.


Arthur Ronald Huntington: Mr. Speaker, while the minister is looking into the risk and accountability aspects of such a credit card issue, would he also look into the purchase of $58 worth of pantyhose at an Eatons's downtown store in Vancouver, and will he take steps to protect the credit of the Canadian Broadcasting Corporation by either withdrawing such credit cards or by instructing the CBC to pay its account with Eaton's on time?
Oral Questions


John (Moody) Roberts: Mr. Speaker, I take it the hon. member's question relates to the CBC. I shall be happy to pass on his concern about pantyhose and any other miscellaneous details.


AGRICULTURE
John Raymond Ellis: A few weeks ago the Minister of Agriculture made a speech having to do with tariffs on canned tomatoes. This resulted in a headline that said he promised 17 per cent protection. Can the minister tell the House if there is to be 17 per cent protection for producers in the province with regard to imported canned tomatoes?


Eugene Whelan: Mr. Speaker, I am fully aware of the headline in that newspaper. That was not what I stated. The person who wrote it was concerned about what the Tariff Board had recommended. The Tariff Board had recommended that kind of protection.
In the talk I gave to them, I said that I hoped they would be somewhere near that when the recommendation was made, etc. I can give the tape to the hon. member to listen to. All my speeches are taped and double-taped to make sure that when somebody does use a headline such as this, we can offer them the evidence of what was actually said.
As the hon. member knows, a study of the Tariff Board report has been completed. Negotiations have been going on for some months, representations have been made and we hope they will soon be implemented.


John Raymond Ellis: Mr. Speaker, it is obvious the Minister of Agriculture wants to support the farmers in this matter.


FINANCE
John Raymond Ellis: May I ask the Minister of Finance whether in cabinet he will support a recommendation espousing such a tariff to protect the tomato growers in the province?


Joseph Jacques Jean Chrétien: Mr. Speaker, if we have something to make public, we will do it in due course. 1 am not in a position to do it at this time.

February 26, 1979
Public Service PRIVILEGE


MR. FRIESEN-REMARKS OF PARLIAMENTARY SECRETARY TO MINISTER OF INDUSTRY, TRADE AND COMMERCE
Mr. Benno Friesen (Surrey-White Rock):: Mr. Speaker, last Friday I rose on a question of privilege respecting language used in the House by the Parliamentary Secretary to the Minister of Industry, Trade and Commerce (Mr. Loiselle). He was not in his seat at that time so I reserved my question of privilege until today.
I would point out that Hansard records that the Acting Speaker on that evening pointed out that the rules of the House did not permit me to rise on that occasion to ask the hon. member to retract his statement. While I applaud his facility in bilingualism, I wish he would use a more elevated diction. As Hansard records, and as Beauchesne points out, the language he used on that evening was definitely unparliamentary, and I would ask him to retract his statement.


Mr. Bernard Loiselle (Parliamentary Secretary to Minister of Industry, Trade and Commerce):: Mr. Speaker, it is a fact that I used the expression "bullshit" but unfortunately this type of slang is sometimes acceptable in French. I just cannot accept the pessimistic attitude of the hon. member opposite concerning the excellent record of the Canadian economy. I therefore withdraw my remarks, but I realize at the same time that they were founded.


Mr. Speaker:: Order, please. As the hon. member for Surrey-White Rock (Mr. Friesen) pointed out, we were facing a procedural constraint, as we do in adjournment debate when we set aside three ten-minutes periods. We have always followed the practice that those periods cannot be upset by procedural discussion of any sort. When this occurred, the hon. member properly gave notice and the parliamentary secretary in response to this later discussion has now withdrawn the offending remark. The matter is now closed.



ROUTINE PROCEEDINGS


J. Judd Buchanan: Mr. Speaker, pursuant to Standing Order 41(2), I wish to table in both official languages the 1979 report on program performance measurement in the public service of Canada.


VETERANS AFFAIRS
Daniel Joseph MacDonald: Mr. Speaker, June 6, 1979, marks the thirty-fifth anniversary of the D-Day landings in Normandy. I would like at this time to pay homage to the gallant Canadian sailors, soldiers and airmen who took part in the allied invasion of Normandy on June 6, 1944, the greatest amphibious operation of all time.
Thousands of Canadians servicemen in the Canadian 3rd division, 2nd Canadian armoured brigade and 1st Canadian parachute battalion-nearly one-fifth of the total invasion force of 100,000 men-stormed across the Normandy beaches and elsewhere to free northwest Europe from the tyranny of enemy occupation. By the end of that dramatic day 35 years ago, it had become apparent that the massive venture had succeeded, though it represented for Canada a loss of 1,074 killed, wounded and missing.
Canadian veterans of the three services who took part in the Normandy landings continue to reflect on those events and think of their comrades who fell, denied the chance to return home and partake of the opportunities of our growing and prosperous land.
This coming June, Mr. Speaker, I will lead a delegation of 40 veterans, representing the Canadian units, battalions, regiments and corps which took part in Operation Overlord. Commemorative ceremonies will be held at Beny-sur-Mer and other sites in the Canadian sector. The group will also participate in British and American ceremonies in the respective sectors. Representatives of the Royal Canadian Legion and National Council of Veterans Associations will also attend these commemorative ceremonies.
I must remind hon. members that we emerged as a great nation because of the tens of thousands of young men and women-including some who sit here today as members of parliament-who volunteered in two world wars to fight for their country in far off lands when our freedom was threatened. These Canadians served and fought together, regardless of language, race or color. They fought united as Canadians on the Normandy beaches and later in the campaign in northwest Europe-the final turning point in the titanic struggle to preserve freedom and democracy in the world.
Let us remember today and always the thousands of Canadians who lie in graves in France and around the world because of their duty to Canada. They, by their sacrifice, protected our freedom to govern and to build a great nation for those of us who remain. They have earned their place of honour, and "We will remember them".


Some hon. Members:: Hear, hear!


Mr. Dan McKenzie (Winnipeg South Centre):: Mr. Speaker, I am delighted to join with my colleague the Minister of Veterans Affairs (Mr. MacDonald) in paying homage to the gallant Canadian sailors, soldiers and airmen who took part in the allied invasion of Normandy on June 6, 1944. The minister is quite correct in terming this the greatest amphibious opera-
February 26, 1979

tion of all times and no one who lived through those days will ever forget the fear and tension of the moment.
It is also important that Canadians not yet born in 1944 be reminded of the valiant efforts of the invasion force and the terrible losses suffered during that day-1,074 killed, wounded and missing in a single day. The figure is awesome.
I congratulate the minister on his plan to lead a delegation of veterans who took part in Operation Overlord to the commemorative ceremonies at Beny-sur-Mer. I am sure this will be a moving occasion for all involved and will serve to draw special attention to the thirty-fifth anniversary of D-Day.
To the minister's call to remember the thousands of Canadians who lie in graves in France and around the world, I would also like to add a plea to remember the veterans who returned. I am thinking particularly of veterans who were accorded veterans' preference in employment in the public service and who are now suffering from an apparent change of government policy in this regard. I also refer to veterans experiencing difficulties obtaining admission to former veterans' hospitals, widows of veterans denied a pension because of the government's failure to act on the recommendations of the Standing Committee on Veterans Affairs relating to prisoners of war, war amputees and others.
Yes, Mr. Speaker, by all means let us remember the anniversary of the D-Day landings in Normandy; but at the same time let this government manifest in a tangible way to the veterans of this country that they are remembered also.


Some hon. Members:: Hear, hear!


Stanley Howard Knowles: Mr. Speaker, we are happy to join in welcoming the announcement that has been made by the Minister of Veterans Affairs (Mr. MacDonald) that he will lead a delegation to Normandy on June 6 of this year. I remember very well the solemnity of that day, June 6, 1944, in this House of Commons when all of us realized how much turned on the events that were taking place. It was before the days of television and so we went across the hall to room 16 to listen to a radio broadcast by his Majesty King George VI. As I say, we were all aware how much depended on the outcome of the events of that day.
Accordingly, Mr. Speaker, we are glad that this delegation will be going to commemorate the thirty-fifth anniversary, and I join with the minister in saying that we cannot too often say of Canada's veterans "We shall remember them".


Some hon. Members:: Hear, hear!


Mr. Eudore Allard (Rimouski):: Mr. Speaker, I want to thank the minister for providing me with the text of his remarks a few minutes before the oral question period.
Mr. Speaker, even if World War II events are slowly falling into oblivion, there are faces and memories which just refuse to die. For all those of us who lived through the difficult
Point of Order-Mr. Alexander Normandy landings and all those Canadians who were involved in it, this remains the epitome of courage and determination.
This military operation certainly proved costly, claiming nearly 1,100 Canadian lives, but what sorrow for all those who, on this side of the Atlantic, had lost their loved ones. Yet, they could find solace in the conviction that these braves had not lost their lives in vain. Thus falling on the field of honour, our Canadian servicemen have set the corner-stone for the new, strong, prosperous and free Canada in which we live today and which we owe in part to them. This is something to keep in mind. I sincerely wish that all young Canadians will follow the fine example of courage and determination these heroes have set and which remains a source of unlimited hope for the future.


Hon. Barney Danson (Minister of National Defence):: Mr. Speaker, I do not mean to intrude into the area of my colleague, but I would like to point out that one of the spearhead brigades of that invasion was the 8th Canadian Infantry Brigade in which I served. That brigade was made up of Le Regiment de la Chaudiere which was all French speaking; the North Shore New Brunswick Regiment which was about half French speaking; and the Queen's Own Rifles of Canada which was English speaking. So it was a brigade commanded at one time by a Francophone commander which was just about 50-50 English speaking and French speaking. I hope that Canadians will not forget that. I hope they will also not forget that had we had an alliance at that time, and had we been prepared better than we were, we might not have seen all of those lives lost.


Some hon. Members:: Hear, hear!


POINT OF ORDER
Mr. Lincoln M. Alexander (Hamilton West):: Mr. Speaker, I rise on a point of order. I want to register my concern with respect to actions by ministers that are taking place of late in this House of Commons. We have just seen the President of Treasury Board (Mr. Buchanan) tabling a document or documents concerning program performance measurements. What I find extremely offensive is the fact that I know he held a press conference, or a mini-press conference, this morning. The press is aware of the contents of the documents. It seems to me the practice is that ministers are now tabling documents and running.
As I understand it, Mr. Speaker, this is the sort of practice which is becoming more prevalent. I understand from the documents they have tabled that they have picked the best and ignored the rest, and given them a gold star, which is certainly distorting the truth. Sooner or later we have to put our finger on the problem around here. When I first arrived in 1968

February 26, 1979
Normandy Landings
ministers had the guts to stand up when they were tabling documents.
This document or these documents in particular are of some concern because they talk about the economy, value for money, efficiency, the Comptroller General and the Auditor General. This sort of practice must stop. We in the opposition must be given an opportunity to know at least as much as the press. The press knows all about the documents which have been tabled this afternoon. I think it is very unfair and most discriminatory that we do not. It shows a certain amount of irresponsibility on the part of ministers. I would respectfully say, sir, that we have to come to grips with these particular tactics which this government is becoming so famous for in attempting to evade its responsibilities.
My objection is that if ministers can table documents after they have discussed the contents therein with the press, then I think it is incumbent upon them at least to give us the benefit of their views at the time these documents are tabled, rather than tabling documents and running, which seems to be the policy of this government.


J. Judd Buchanan: Mr. Speaker, I am not quite sure what the hon. member is alluding to. I was in Toronto all morning and did not have a press conference. I do not know what he is speaking about, I am sorry.


Some hon. Members:: Oh, oh!


Mr. Speaker:: Order, please.


Lincoln MacCauley Alexander: Mr. Speaker, there was a conference held-


Mr. Speaker:: Order, please. In any event the hon. member for Hamilton West (Mr. Alexander) was not on very strong procedural grounds. I do not know what procedural objection can be taken to a minister tabling documents. The hon. member may have a grievance which he wants to argue about, but in fact there is no action that the Chair can possibly take on the point that he raised.


VETERANS AFFAIRS
Mr. Tom Cossitt (Leeds):: Mr. Speaker, in regard to the statement made a moment ago by the Minister of Veterans Affairs (Mr. MacDonald) and to speeches made by other members representing other parties, I stand to be corrected but I assumed that it was possible under the procedure now in effect for a member to ask a question of the minister in regard to the statement he had made following the making of that statement.
If that is correct, in the minister's absence I would like to direct my question to whomever the acting prime minister may be.


Mr. Speaker:: Order, please. The hon. member for Leeds (Mr. Cossitt) is correct that we have been following a practice which calls for discretion by the Chair in entertaining questions of a minister following a statement made by a minister and then corresponding statements on behalf of the other three parties. However, the existence of a question period itself and the duration of it, if it does exist, is in the discretion of the Chair. I did see the hon. member standing but I was not aware that he wanted to put a question. Frankly, my inclination would be that this was not the kind of statement which would ordinarily lead me to conduct a question period in any case.
In these circumstances, the nature of the statement would be such that I would have had to have some advance notice. The hon. member will be aware that in almost every other case where a statement is made by a minister and it raises an area of some discussion or some disagreement, that is routinely followed by a question period, but with the more ceremonial statements of this sort we have not done that. I think I would exercise my discretion along those lines in that way.
I should also say to the hon. member that if I do start a question period the rule is that questions can only be put to the minister who has made the statement. Therefore, perhaps the hon. member will have another opportunity to put whatever question it was, he had in mind.


ADMINISTRATION OF JUSTICE
Mr. G. W. Baldwin (Peace River):: Mr. Speaker, I rise on a point of order dealing with ministers' statements. I have just been advised that the Minister of Justice (Mr. Lalonde) went outside the House and made a statement to some members of the media to the effect that the government did not intend to appeal the decision in connection with the case of Peter Treu. This, of course, is the right of the minister, but to some extent this matter was the property of the House and it had been raised in the House.
I did attempt to seek the floor in order to put a supplementary question but the Chair did not recognize me, as is its privilege. Tied up with the question of appeal is the question of compensation and matters of that kind. I think it shows a shocking arrogance and contempt on the part of the minister by his failing-


Some hon. Members:: Oh, oh!


Gerald William Baldwin: I see the minister is here now. It has been brought to my attention that the minister made the statement that it is not the government's intention to appeal the case of Peter Treu and that this statement was made outside the House. If I am wrong in that and the minister tells me, I will apologize. However, if I am correct, I think the minister should apologize, or, in the alternative, make a statement in the House at this time.

February 26, 1979


Mr. Speaker:: Order, please. Before recognizing the minister I want to say that the hon. member for Peace River (Mr. Baldwin) did ask a question to this effect a day or two ago. I know that he was trying to get recognized today. Obviously the line he is pursuing is one that ought to have been pursued in the question period. He is telling the House that, through circumstances beyond his control, he was not able to do that. I was not able to recognize him in the question period. That does not alter the basic fact that the hon. member does not have a good procedural ground. If the minister intends to make a statement now, it will have to be with the consent of the House.


Marc Lalonde: Mr. Speaker, I waited during the whole question period for a question on this particular subject. Unfortunately no question came. I instructed my officials to advise counsel for Mr. Treu at noon today that the government would not be appealing the case. Since I had not had the question in this House during question period, when the press asked me about it after question period I indicated my decision not to appeal the case against Mr. Treu.


Gerald William Baldwin: Mr. Speaker, I will not pursue this further except to say that under those circumstances I will tell the minister that anything I said about his being arrogant and contemptuous I will withdraw, because he was waiting for me to ask the question. That I was not recognized was not his fault. It is not often that ministers sit around waiting for me to ask questions; I hope it becomes a habit. I certainly hope that under the circumstances the Chair's very long memory will be kept in full gear so that tomorrow or the next day this matter might indeed be pursued.


Thomas Charles Cossitt: On the same point of order, I feel that I have a valid point of order with regard to what the Minister of Justice (Mr. Lalonde) has just said, that he made the statement outside the House because he did not have an opportunity to answer inside the House. I, and I am sure other hon. members, fail to see why he could not have made such a statement on motions.


Mr. Speaker:: I think the hon. member will recognize that if ministers were to avail themselves of an opportunity to make such a reply, which might be only a single line, on statements on motions on a regular basis, that procedure would get very cluttered indeed.


CANADA EVIDENCE ACT
Mr. J. Robert Howie (York-Sunbury) moved: for leave to introduce Bill C-462, to amend the Canada Evidence Act (evidence not lawfully obtained).


Some hon. Members:: Explain.
Order Paper Questions


J. Robert Howie: Mr. Speaker, the purpose of this bill is to put the common law poisoned evidence rule into perspective in certain criminal cases.


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

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Yvon Pinard (Parliamentary Secretary to Deputy Prime Minister and President of Privy Council):: Mr. Speaker, questions Nos. 234, 383, 597, 623, 696 and 735 will be answered today.


Mr. Howie: For the Fiscal year ended March 31, 1978, what amount was spent on interior landscaping by the Department of Public Works?


Hon. Andre Ouellet (Minister of Public Works):: For the
fiscal year ended March 31, 1978, $161,448 was spent on interior landscaping by Public Works Canada from its departmental appropriations.


Mr. McCain: 1.	What amount was spent on subsidies for Fishing vessels by the Department of Fisheries in eastern Canada in each Fiscal year 1970 to 1979?
2.	(a) What was the size of each boat subsidized (b) what was the amount of the subsidy (c) who is the registered owner of each boat?
3.	What was the class of Fishing licence or licences owned by the successful applicant?


Mr. Jack Pearsall (Parliamentary Secretary to Minister of Fisheries and the Environment):: 1. The following subsidies were paid for fishing vessels in eastern Canada (Newfoundland, maritimes and Quebec) 1970 to 1979.
Amount ($000)	No. of Vessels
1970-71	939.2	941971-72	1952.71	2111972-73	3158.2	2491973-74	7960.0	4191974-75	3876.9	2631975-76	3575.4	2541976-77	3098.2	3131977-78	3633.4	3771978-79*	6438.6	396
* Funds allotted and vessels approved to date.
2. (a) Number of vessels and size range 1978-79 (See note). 25' - 35'	58	vessels36' - 45'	314	vessels46' - 55'	17	vessels56' - 65'	7	vessels396	,
Note: For previous years data could not be provided without excessive cost and time.

February 26, 1979
Order Paper Questions
2.	(b) and (c) The amount of individual subsidies and the recipients is considered confidential information.
3.	The following aggregate number of classes of fishing licences were issued to approved vessels in 1978-79 (See note 2 (a)). The names of the licence holders are confidential.
Lobster	279
Groundfish	238
Herring	208
Mackerel	62
Scallop	50
Salmon	45
Irish Moss	23
Eel	12
Oyster	12
Longline	12
Tuna	10
Snow Crab	8
Smelt	7
Gaspereau	4
Shrimp	1


Mr. Mazankowski: 1.	Did the Attorney General of Canada register a Statement of Claim in the City of Winnipeg, July 24, 1978 against Host Rent-a-Car Ltd. for total arrears, including interest, in the amount of $863,679.96 and, if so, what is the total amount of arrears and interest owed to the Department of Transport by the Company from July 24, 1978 to date?
2.	Does Section 27 of the Contract Lease Specifications for Car Rental Concessions state, that in case of non-payment of fees, default, breach or non-observance made by the lessee, the Department may terminate the agreement between Host Rent-a-Car Ltd. and the Department of Transport and also, if required by the Minister, remove all supplies, articles, equipment, materials, effects and things brought or placed thereon or therein by the lessee and, if so, for what reason did the Department not implement Section 27 of this tender contract?
Hod. Otto E. Lang (Minister of Transport): 1. Yes. The arrears, including interest, from July 24, 1978, to November 15, 1978, total $1,119,260.
2. Yes. The Crown instituted its statement of claim against Host after due consideration of the available legal recourses.


Mr. Friesen: How many persons are employed as (a) stone carvers (b) carpenters (c) painters by the Department of Public Works and, in each case, how many are in the salary range (i) $5,000 to $8,000 (ii) $8,001 to $10,000 (iii) $10,001 to $12,000 (iv) $12,001 to $14,000 (v) $14,001 to $16,000 (vi) $16,001 to$18,000 (vii) $18,001 to $20,000 (viii) $20,001 or more?


Hon. Andr6 Ouellet (Minister of Public Works and Minister of State for Urban Affairs):: Public Works Canada employ:

Salary Range	(a) Stone Carvers	(b) Carpenters	(C) Painters(')	5,000 to 8,000	nil	nil	nil(ii)	8,001 to 10,000	nil	nil	nil(iii)	10,001 to 12,000	1	8	1(iv)	12,001 to 14,000	nil	20	25(v)	14,001 to 16,000	2	55	23(vi)	16,001 to 18,000	1	24	3(vii)	18,001 to 20,000	nil	1	nil(viii)	20,001 or more	nil	3	nilTotal:	4	111	52


Mr. Forrestall: 1.	With reference to the $1,200,000 spending cutback that will result in a reduction in the level of flying time contracted for ice reconnaissance purposes, which contracts currently held in the Arctic and Atlantic areas will be reduced or terminated?
2.	What percentage of the total (a) budget (b) flying time for ice reconnaissance purposes does such reduction represent?
3.	What part of the reduction in the level of flying time represents time contracted for over Atlantic areas as compared to Arctic areas?
4.	Will there be a corresponding reduction in ground operations as a result of the reduction in flying time?


Hon. Len Marchand (Minister of State (Environment)):: 1.
Most ice reconnaissance is flown under a single multi-year contract which remains in force, but flying time will be cut back to the minimum allowed in the contract.
2.	The reduction represents approximately (a) 13 per cent of the proposed budget and (b) about 17 per cent in contract flying hours.
3.	Likely in the order of 40 hours or 4 per cent of the planned total for the Atlantic areas as compared to 90 hours or 6 per cent of the planned total for the Arctic.
4.	There will be no reduction in service output, for most cuts will be made in remote sensor development and in the system documenting where these sensor records were obtained.


Mr. Mitges: 1.	Has the Multiculturalism Directorate developed a method of evaluating the (a) effeciency (b) effectiveness of its programmes which are involved in the distribution of grants and/or contributions and (i) if so, what is the method (ii) if not, for what reason?
2.	With respect to the above programmes, for the fiscal year (a) 1975-76 (b) 1976-77 (c) 1977-78 (d) 1978-79, has the Directorate made any attempt to evaluate their (i) efficiency (ii) effectiveness and, if so, what were the results?


Hon. Norman A. Cafik (Minister of State (Multiculturalism)):: 1 and 2. Up to the present time evaluation of the multiculturalism programs has been an informal but constant and on-going process, leading, in 1977, to a review of the entire multiculturalism program within the Secretary of State Department. As a result of this review new directions were given to the program, with the introduction of new activities and the expansion of existing projects; new and revised criteria were established; and Treasury Board approval obtained for additional resources to carry out the new directions over the
February 26, 1979

next five years. The directorate is now in the initial stages of developing a formal plan to evaluate the efficiency and effectiveness of its programs which are involved in the distribution of grants and/or contributions.


Yvon Pinard: Mr. Speaker, if question No. 42 could be made an order for return, this return would be tabled immediately.


Mr. Orlikow: 1.	For the fiscal year 1976-77, what contracts for professional services were let for studies, surveys and analyses into (a) present or future policies, programmes or information analysis and their efficiency and effectiveness (b) the examination of the administration or internal operation of the Department of National Health and Welfare?
2.	How much was committed on each contract and to whom?
Return tabled.



POINT OF ORDER


Thomas Charles Cossitt: Mr. Speaker, I rise just briefly to draw attention to the same four questions that I have drawn attention to on at least five or six occasions. In the absence of the parliamentary secretary, I raised this point about a week ago with the hon. member who stood in for him. I asked if I could be told when these long standing questions would be answered.
One question is No. 4, concerning members of the Canadian Transport Commission or their wives who have passes with Air Canada. This question has been outstanding on various order papers for two years and eight months.
Another concerns purchases made by the Prime Minister's office in excess of $86,000 from public funds. I asked what this represented. It has been outstanding for three years, despite the fact that the Prime Minister (Mr. Trudeau) said in this House "Let it be made public. Put it in all the papers, I don't care". That was one year ago.
I would also ask about two other questions. Question No. 9 concerns the invasion of privacy, and so on, of public servants in non-security risk positions who have been fingerprinted. I asked why this was being done, how many have been done and so on. This question has been outstanding for two years.
Housing
Finally, question No. 10 concerns Martin Goldfarb and Goldfarb Consultants, also known as pollsters for the Liberal party. I asked how much work they had done for the government. This question has been outstanding for one year and seven months on various order papers.
I wonder if the parliamentary secretary, as I said before many times, instead of giving percentages of how well he has done, could tell us about the questions he has not answered which are embarrassing to the government. I assume the reasons for not answering these questions can only lie in that category. Can I have some assurance as to when these questions will be answered?


Yvon Pinard: Mr. Speaker, the hon. member is complaining about four questions only which have remained unanswered. That is, of course, because we have answered a very large number of his questions during the last few months as he might have noticed. So he can rest assured. Once again, I would remind him that he has always been treated very fairly by parliament, and we will continue to give his questions serious consideration.


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


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Friday, February 23, consideration of the motion of Mr. Ouellet that Bill C-29, to amend the National Housing Act and the Central Mortgage and Housing Corporation Act and to make other related amendments, be read the second time and referred to the Standing Committee on Health, Welfare and Social Affairs.
Jean Elizabeth Pigott: Mr. Speaker, before we adjourned debate on this bill on Friday, I had been explaining the failure of this government over the last eight years to commit itself to any national urban strategy. Moreover, as late as this past week end the minister in Montreal reiterated the stark fact that housing is not a priority of this government. It is interesting to see that for the debate on this bill the minister is not in the House.


Mr. Paproski:: That shows how much he cares.


Jean Elizabeth Pigott: That's right.

February 26, 1979
Housing


Marc Lalonde: On a point of order, Mr. Speaker, the hon. lady will realize that the minister had an important press conference in Montreal at noon today. He is on his way to this House. He will be here a little later this afternoon.


Jean Elizabeth Pigott: It is funny that press conferences always take precedence over what is going on in the House of Commons.


Mr. Boulanger:: Where's Joe?


Jean Elizabeth Pigott: I am interested in the minister whose bill this is.


Prosper Boulanger: I am interested in Joe Clark.


Jean Elizabeth Pigott: You will have a lot of him later. The government, in the words of the Minister of Industry, Trade and Commerce (Mr. Horner), believes that housing is a luxury and will always be considered a luxury. I can only relate the facts of the latest available study, including all of the ones I have from the minister's own office.
More than 40 per cent of Canadian home owners had personal incomes in 1976 of less than $10,000 and 67 per cent of them had incomes under $15,000-and the government think that mortgage deductibility is just for the rich. Less than 6 per cent of all Canadian home owners reported personal incomes of more than $25,000 in 1976. If one takes household income, which is the total income in a household, even if more than one spouse works or there are working dependants, the figures for 1976 show that 35 per cent of all home owners in Canada had an income under $10,000 a year. Slightly more than 10 per cent of all Canadian home owners recorded household incomes of more than $25,000.
These are the facts about Canadian home owners who the Prime Minister (Mr. Trudeau) and the Minister of State for Urban Affairs (Mr. Ouellet) claim are too rich to deserve any kind of tax break from their government in Ottawa. In terms of occupation, it is worth noting that the largest single category of homeowners, almost 35 per cent, are skilled or unskilled labourers. When we get out on the hustings, Mr. Speaker, I wonder what the other two parties are prepared to do, and will they go into the union halls and factories and tell these Canadians that they are too well off to warrant a tax reduction?
What about the second largest category of home owners? They are retired people and account for 19 per cent of all home owners. Are they the rich?


An hon. Member:: Perhaps.


Jean Elizabeth Pigott: Well, tell that to the home owners. Tell them they should not have a tax break. In fact, these classified home owners, the top income category, account for little more than 6 per cent of all Canadian home owners. The minister spent most of his time last Friday discussing the benefits of extending tax reductions to the beleaguered Canadian home owner. Like a variety of economists, columnists and politicians who

criticize our proposal, it has been an interesting exercise to watch the number of Liberal government spokesmen assume the role of critic, one usually reserved for our side of the House. We have had the more positive role of taking the government side. Let me assure hon. members opposite, Mr. Speaker, that this is a position my party and my leader readily accept.


Some hon. Members:: Hear, hear!


Jean Elizabeth Pigott: I do not wish to dwell too long on this subject, but long enough to say that our proposed policy is one which offers tax recognition and relief to Canadians who have worked hard and saved to buy homes of their own. These are the forgotten people of the Canadian tax system who put up most of the money and make relatively little demand on many public services.
The Progressive Conservative party does not accept the Liberal no-growth scenario of the future. It means death to our communities. Our party is the only one to accept that growth must be an economic policy. Originally, the concept of government was that taxpayers would finance the administration to contribute to the economy. We now seem to be caught in the position of trying to administer the economy to finance the government. For 16 per cent of every Liberal government dollar goes to finance the national debt, which will reach $100 billion next year.


Some hon. Members:: Shame!


Jean Elizabeth Pigott: The government will have the dubious distinction of being known as the government of default by default. On behalf of the Conservative party, the future government, I make no apology for the fact that we recognize it is high time that Canadians were given some recognition and some incentive to keep up the hard work on which this country was built. That means we would not continue with a tax system which penalizes young couples who want a home and young children. Mr. Speaker, it means turning our tax system around to reward those who produce and those who save in order to provide the capital for the expansion of our economic base, which in turn provides the jobs for our chidren.
After the minister's trip to Toronto on Wednesday of last week, I thought it would be interesting to read the Globe and Mail. It said:
No, Mr. Ouellet's proposal falls down on its own demerits. Whatever its failings, Mr. Clark's mortgage deductibility program was aimed at reducing the high inventory of houses on the market, prompting a boom in the housing industry, and reactivating the economy. What Mr. Ouellet suggests is, quite simply, a redistribution of wealth, and the obvious question is, why is he cloaking a plan to cut taxes in something that resembles a housing policy?
The answer, we fear, is that the federal government, anxious to be seen as all things by all people, delights in creating special categories which appeal to special sectors of voters. Mothers get a cheque, families with low income get a cheque, everyone gets a cheque-less a policy than a determined effort to disguise a lack of policy. With any luck, the builders' reaction-one of disappointment-should convince Mr. Ouellet, and his government, to leave this particular kite on the conference floor.
This is one time I happen to really agree with the Globe and Mail.
February 26, 1979

One of the remaining elements in the bill emphasizes new expanded use of NHA mortgage insurance. In point of fact, the aggregate maximum of loan insurance has been increased to $40 billion and we hope to spend more time in committee in this area. The AHOP program has been dropped in favour of a graduated mortgage payment. Major lending institutions do not support this financing technique and to gain this support the government proposes to implement a quick settlement package. In the words of one analyst, "there are no longer any checks and balances; no rules for circumspection. The borrowers can borrow with hardly any money down. The lenders can lend with scant attention to risk. And CMHC can subsidize with magnanimous indifference."
I would like to read a little more, Mr. Speaker. I think it is important to quote, for instance, from the magazine "Finance". I refer to an item headed "The federal mortgage mess: will the banks help bail out Ottawa?" It is by Stephen Raikes:
It started out last winter as an election plum-yet another program to help thousands of "average Canadians" buy homes they would otherwise be hard pressed to afford.
Now, several months after the election-campaign-that-never-was, Ottawa's Graduated Payment Mortgage (GPM) program looks more like a badly shriveled prune-
Suppose for instance that a house buyer needs to borrow $35,000 at 10!4 per cent for 25 years... The unpleasant but less obvious fact is that over the life of the debt the GPM will cost the borrower $9,324 more than the standard mortgage would-$105,024 compared with $95,700. In those early years his payments aren't large enough even to cover all the interest, let alone retire any of the principal. As a result, he's obliged later on to pay interest on his unpaid interest. Thus his debt, rather than being retired, gradually increases-
Understandably, there are people in the world of finance who wonder whether there is a house buyer anywhere in Canada who really needs that kind of "help" from his federal government.
W. Peter Carter, past chairman of the mortgage committee of the Canadian Bankers' Association, has coined his own term for this. He calls it "GPM, the Permadebt." I think this is a very serious side to the graduated payment mortgage, Mr. Speaker, and we must take much more time to debate it. We must spend time in committee on its detail.
On the one hand we have the Minister of Finance (Mr. Chretien) who wants to continue to wrestle inflation to the ground, and on the other we have the Minister of State for Urban Affairs phasing in graduated payment mortgages based on future inflationary increases in prices and incomes. We are putting people into a dreadful box if we pass this piece of legislation.
The Minister of Finance claimed some months ago that the money spent under the present government went to build houses and increase supply, not to create expectation and demand higher prices. In fact, scarcity of serviced lots and high carrying costs due to zoning delays combined with this government's own demand initiatives equal unprecedented housing inflation over the past four years. This problem is now compounded by the fact that residential construction activity is bound to decline if the current large inventory of newly constructed but unoccupied dwellings is not absorbed.
Housing
To compensate for this decline in residential building activity the minister has encouraged the home building industry to become actively involved in the new co-operative and non-profit form of housing. In a speech he made last Friday the minister went to great lengths to describe this. But what worries me is the statement the hon. gentleman made last September when he was discussing the CMHC budget cuts. The minister urged sponsors of low income housing projects to give up their preoccupation with the design and construction of new housing. He went on to say, and I quote:
I believe that low income housing sponsors would be wise to consider seriously the "best buy" principle and look toward existing housing for their clients rather than think in terms of new structures.
I hope the people in the private sector will recognize what the minister was saying here. I am warning them now that he will probably try to get rid of the 53,000 AHOP homes before he lets them go ahead.
Mr. Adamson of the Central Mortgage and Housing Corporation indicated last year in a speech in Windsor that while the new non-profit program promises to do a better job of bringing adequate accommodation within the reach of many people, it is not likely to have a massive effect on the production of new housing. I think this is one thing this House and this government must realize. While it is imperative that we encourage this side of our community life, we must realize that it represents only a very small proportion of what must be done in the housing market.
As for the termination of the old AHOP, the minister is certainly aware of my evaluation of that program. However, I believe it is important for us to examine for the record the actual success of this program because I believe it mirrors the future of the graduated mortgage payment as it is being proposed at the moment. The graduated mortgage payment is much worse, from the government's point of view, because there will be an automatic payout with any account three months in arrears.
I would like to draw the attention of the House to the fact that AHOP foreclosures increased by 463 per cent in 1978 over 1977. That is to say, the number of AHOP foreclosures increased from 265 to 1,492. AHOP foreclosures now account for 56 per cent of all mortgages acquired by the mortgage insurance fund. Furthermore, we have stated that the default rate approximates 10 per cent. In recent correspondence the minister indicated that it is 1.62 per cent of direct loans administered by Central Mortgage and Housing Corporation, up marginally, he said, from the 1.31 per cent of a year ago. However, a year ago in the Standing Committee on Health, Welfare and Social Affairs he indicated that the default rate was 5.6 per cent, up from 5.1 per cent, and records show that by March of 1978 the rate was 8 per cent.
Now the minister states that there are 36,000 AHOP accounts under administration. One year ago there were 39,000. Changing the definition does not remove the fact that there are hundreds, if not thousands, of AHOP purchasers
3586

February 26, 1979
Housing
who are now having difficulties in meeting their shelter expenditures. It is a common joke within the Central Mortgage and Housing Corporation that the minister is operating the best key club in Ontario because people just mail in their keys.
Meetings called "disaster meetings" are held at the Central Mortgage and Housing Corporation with regard to AHOP foreclosures, but the minister will not even answer our questions about them in this House. What is even more alarming is the growing number of reports daily about lack of quality construction in many AHOP homes, in violation of the national building code. I am aware that in the spirit of good politics a man should mend his fences. If this holds true for this program, the minister had better start "fixin". The question this raises is, what does it actually mean when a project is advertised as "government approved" or "CMHC approved"? According to the minister or his ex-parliamentary secretary, the hon. member for Ottawa-Vanier (Mr. Gauthier), the slogan or advertisement "CMHC approved" means nothing. Indeed, according to the ex-parliamentary secretary, the government could not care less what happens to the houses. The only inspection which is supposed to be carried out pertains to the advancement of mortgage money. We know from the growing number of reports and the increase in the number of active RCMP investigations that the government cannot even manage this. This is one of the hidden tragedies.
How many people have driven by these projects and seen the label of the Government of Canada on them, and how many have thought that they were buying a good product? This is a serious matter which must be investigated and rectified.
I found it particularly enlightening to review another confidential study of the department which reads in part as follows:
Provision of insurance entails appraisal and inspection of units and this served to provide a kind of guarantee to purchasers on the quality and workmanship of their unit.
The question, of course, is whether or not we can describe the kind of guarantee which is referred to in that cabinet document.
Before I leave completely the housing mortgage issue, I think I should make it clear that if the minister had anything to say last week in Toronto, one thing was clear: housing is not a priority of this government at this time. We on this side feel that housing is a basic right of every Canadian, and to us it is priority.
If the so-called Canadian housing crisis means anything, the lack of affordable and meaningful choice is its characteristic. Many Canadians have been forced into the no housing choice position in which a third to one half of their regular income goes for shelter. In this process they do not necessarily gain better quality but may be forced into accommodation which is considered by any set of criteria to be substandard. The changing pattern of ownership and tenancy is a response to what is available, not an exercise of choice.
To many Canadians this lack of choice means that the user requirements are not being met. User requirements have physical, social and environmental aspects. Physical requirements relate to a concern about the individual house and its heating,

plumbing and wiring systems. They pertain to structural safety and to the development and determination of housing standards which will engender good public health. At least half the total housing stock in the 1970s was created prior to 1945, and a fair proportion of it was built in the first quarter of the century or earlier. This very substantial amount of reasonably good old housing deserves our profound attention during the balance of this century. This party feels very strongly that this is a priority.
User requirements, however, should be seen in a much wider context. A dwelling is located in a neighbourhood, and much more attention should be paid to the wider environment as one of the important aspects of user concern. Therefore, user requirements must be conceived as social and environmental in nature rather than merely physical.
One of the toughest tasks for business today is to foresee what tomorrow's customers will want to buy. The industry with the bleakest outlook is housing, and that has ominous implications for the rest of the economy. That is why mortgage interest deductibility and property tax deduction proposals are part of our policy. We care about the economy as well as about housing.
Earl Bederman, assistant vice president and economist for the Permanent Trust Company, has said:
The future for housing isn't what it used to be. The annual population growth from now until the end of the century will be 1 per cent compared with 3 per cent of the 1950s. Actual requirements for new housing will take a dive in the mid-1980s.
Bederman estimates that by the end of the century requirements will be 40 per cent lower than they are today. Over the long run, and I quote again:
Real estates markets are likely to get more fragile.
As house prices decline, home owners could find themselves with high mortgages but lower equity. We are getting very close to the point where equity-carrying cost ratios will tilt in favour of more walk-away situations and outright defaults. Price declines in the order of 25 per cent to 30 per cent cannot be ruled out. That is why we have to have a review of AHOP, and we must look very carefully at graduated mortgage payments.
What opportunities there will be in construction should be in smaller-sized homes, duplexes and row housing. The renovation business will boom. It already accounts for 35 per cent of the residential construction market, and analysts feel that it will continue to be the fastest growing sector over the next few years. This must be encouraged by the federal government.
Experimentation in the social and environmental aspects of user requirements should be actively encouraged. Experimentation is required at four levels: the street, the immediate neighbourhood, the subregions within an urban area and the broader community. In short, we must have emphasis on experimentation. Funds must be made available which make much more possible active experimentation in new ways of building our communities. To this end, government and businesses must provide the funds necessary for experimentation to adapt our communities to new forms of living in the remaining
February 26, 1979

part of this century. We must find incentives for the unorthodox builder. The "thou shalt not" philosophy should be replaced by a policy of encouraging social and physical innovation. The Central Mortgage and Housing Corporation and the provincial housing corporations are in a strategic position to provide leadership in such an effort.
The great tragedy is the wasted years of this ministry. I find it strange to read again the comments which the minister made last Friday. Never once did he mention what was going to happen to the people, the policies and the projects that had been started in the ministry. Who is going to care for this in the federal government when the ministry is phased out on April 1? What will happen to CMHC? It is one of the saddest things to have to stand here today and comment about that wonderful organization of the past called CMHC. The minister seems to want to change its name, and I wonder why.
In the question period I asked for an investigation into CMHC by the Auditor General because I believe we must clean up a sad and desperate situation out there. It is rather hard to read into the record what has happened to CMHC under the direction of the minister. I could talk about York Place, luxury hotels, Cloverdale, I could mention Virginia Park, the great home insulation program that never got off the ground, that great tragedy called Walter Rudnicki, the $15,000 staff tournaments, Quigley Road, and land banking. 1 could read into the record the series of five articles in which the Hamilton Spectator wrote about such things as $500,000 for 12 basements, the RCMP probe into housing disasters, 150 Sanford, how the developers' pie was sweetened. But what I need to read really is the very fine editorial which appeared in the Spectator of February 3 entitled "Time to Evaluate CMHC". It reads:
When short-term political considerations become more important than good planning and competent management, taxpayers can expect to find themselves footing the bills without receiving any benefits.
In a probing series of articles published last week, Spectator reporter. John Kernaghan revealed how the corporation has been used as a political tool for several years now. As a result, CMHC may have wasted millions of taxpayers' dollars over the last ten years.
If CMHC had stuck to its original purpose and remained a lending institution, chances are it would be a respected and substantial part of today's housing industry. However, government pressures for social involvement and the consequent use of CMHC as a way to influence voters through such programs as low income housing projects, native housing projects and modified handouts such as the Assisted Home Ownership Plan have left the Crown corporation with some major, and unnecessary, financial white elephants on its hands.
CMHC's current problems apparently stem from a combination of political pressure coupled with a lack of ministerial responsibility and an absence of accountability ... On the other hand, there is also considerable evidence that the federal government frequently ignored the recommendations of CMHC inspectors and officials.
We have terrible tragedies which should be investigated, Mr. Speaker. There is one called 150 Sanford. I believe that there should be an immediate investigation into this area. The editorial goes on to read:
As a first step in cleaning up CMHC's problems, the minister responsible for the agency must exert control over the corporation's plans and its budget-
Housing
Finally, CMHC should not be used as yet another job creation agency or as a vehicle for social form. Its original purpose was to provide funds to home owners, not to developers, and it should return to its role as a funding agency.
To a great extent, the problem stems from the present government's lack of coherent planning and its tendency to distort valid programs to political ends. The unemployment insurance scheme and CMHC are prime examples of the messes that can result.
Since Canada now has a declining birth rate and a temporary housing surplus, it is an ideal time to have the Auditor General review the management policies of CMHC and determine how well taxpayers' money is being spent.


Some hon. Members:: Hear, hear!


Mr. Whiteway:: The minister will not do it.


Jean Elizabeth Pigott: We have asked for it.


Dean Waldon Whiteway: Maybe he is having a press conference to resign.


Jean Elizabeth Pigott: To come back to my comments, sir, may I point out that policymakers must come to recognize that we have a considerable technical knowledge of house building, of the servicing of land and of the provision of physical facilities within a house, on a street or in a neighbourhood, but that we have very little knowledge about meeting people's social and community needs. A major objective is to obtain that knowledge.
This is not to say that we should attempt to obtain this understanding in isolation. Whatever experimentation is going to be tried should be intimately embraced within the systems approach. It should be part of the effort to obtain a better understanding of the urban system. Already many innovations have been made in Canadian urban life. What has often been lacking is the monitoring of these innovations. It is only through organized and systematic monitoring of experiments that answers can be obtained on what works and does not. Probably the major concern that needs to be addressed in housing today is the affordability problem and the promise of industrialization within the housing industry. It is to their credit that the industry has been able to produce as well as it has within the constraints that have developed around it and within it.
However, increased attention must be given to the regional variations in housing construction. As well, qualitative criteria for human habitations must be incorporated. It can no longer remain a policy of guaranteeing mortgage risk only to have the house deteriorate some months after the work is finished. The national building code should not be a static document. Input must come from architects, scientists, psychologists and many others in the formulation of a realistic code that will reflect regional quantitative and qualitative standards for housing.
Other constraints include financing, training and land assembly. I should make reference to the land component. Although a recent study, the Greenspan report, indicated that it was a mistake for government to have initiated land assembly programs when they did, the fact is that affordability and choice could be bettered if policies were launched which utilized the public funded land banks now in existence. We must address ourselves to land banks. We have close to $1

February 26, 1979
Housing
billion invested in them and there should be a well thought out plan for them. I speak with experience because Carlsbad Springs in my constituency is one of the saddest blots on our history. The land there was brought by Mr. Teron before the 1972 election. What happened is that many of the good market gardeners of this region who were displaced, first, by the green belt went out to Carlsbad Springs and were then displaced the second time. People have not received fair compensation, but that is not the only issue. The sad thing is they cannot get a long-term lease and they have no idea what is to happen to that land. Why invest a second time in your life in a good farm if you do not know what the future is?


Mr. Francis:: Mr. Speaker, may I rise on a point of order?


The Acting Speaker (Mr. Ethier):: I cannot recognize the hon. member, he is not in his proper place in the House.


Cyril Lloyd Francis: Yes, I am, Mr. Speaker.


The Acting Speaker (Mr. Ethier):: My humble apologies.


Cyril Lloyd Francis: 1 am sure the hon. member would like to acknowledge the fact, with regard to her reference to Mr. Teron, that he did not join CMHC until 1973. Therefore he could hardly have acquired the Carlsbad Springs area in 1972 when he was in private business.


Jean Elizabeth Pigott: I am glad to see the hon. member for Ottawa West (Mr. Francis) being so close to this side; it is wonderful. Perhaps I am mistaken but I think the hon. member would find that Mr. Teron put together the whole-


Cyril Lloyd Francis: The hon. member is mistaken.


Jean Elizabeth Pigott: I will continue, Mr. Speaker. Returning to the area of land banking, in the long run the forms and procedures for those measures of public ownership which might be required must be the object of study and consultation among the three levels of government. Although this and other improvements should be considered, I should like to emphasize that a fundamental reconsideration of housing policy is required if technology is to be employed adequately.
The absence of an effective national policy for public deployment of land and for application of up-to-date concepts of land usage ultimately must be remedied. Otherwise, alternative policies will be mere stopgaps to be eroded as the built-in constraints take a toll on the national effort. As a parliamentarian, I realize there is an urgent necessity to find a new role for government, sensitive to the complexities of contemporary urban problems.
In the interest of freeing the creative potential of government, I am suggesting a major retreat from processes of heavy bureaucratic supervision of urban programs involving two or more levels of government. Governments as providers of public services must recognize that passing papers of approvals and counterapprovals is a costly, soul-destroying process which can grind the system to a halt. Changing the style of governing will
(Mrs. Pigott.]
take a new sense of maturity, but trade-offs in the way of greater productivity and rationalization of roles should more than offset the imagined losses of control.
One by-product of the new style would be the releasing of provincial and federal governments to concentrate on public policy issues appropriate to their place in the total government system. In urban policy these would be issues related to broad development patterns, the structure of population, employment and services, and the structure of underlying financial allocations and industrial strategies which reverberate on the entire urban system. These sentiments are echoed in a book entitled: "Changing Canadian Cities-The Next 25 Years" by Len Gertler and Ron Crowley. This book contains one of the best quotations concerning urban policy which I have read in a long time. In part it reads as follows:
Looking at the evolution of policy and government I cannot resist the observation that Canadian urban policies are unfulfilled. As a nation in search of a formula to stay united, we are still attempting to carry over into this age of uncertainty the attitudes and styles of government from long ago. The adjustment we make to the demands of our time may determine whether the chroniclers of 2000 A.D. will characterize our period as the "age of wisdom and mature democracy" or of "mismanagement and misguided authority".
The government has failed in controlling inflation, in creating employment for hundreds of young people, and has also missed one of the greatest opportunities of this decade. By concentrating on housing starts the government missed laying the groundwork and planning for Canadian urban living in the 1980s and 1990s. It did not concentrate on affordability and quality of shelter. It did not listen to the grassroots of the nation, the people who want to create community living which will make urban centres liveable and maintain the fundamental social building blocks which make up our society: the family unit, school, church, the work place and the municipal hall. Such a close relationship would maintain and foster the great democratic way of life in this young nation.
The Minister of State for Urban Affairs has failed miserably. I should like to refer to a document entitled: "Report Card for Ministry of State for Urban Affairs". It is the report card of a student, "Andre Ouellet". The report card refers to various subjects. Under the subject "AHOP" the grading is "poor". Under the column "Comment", it reads: "Course dropped-all government students were failing!" Under the subject "ARP", the grading is "fair" and the comment reads: "Mediocre course with questionable benefits".


An hon. Member:: Oh, oh!


Jean Elizabeth Pigott: I think hon. members opposite should read the report card. Under the subject "CHIP and NIP", the grading was "good" and the comment reads:
CHIP-poorly attended.
NIP-needs substantially greater funding.
Under "Community Services Program", the grading is "poor" and the comment reads:
Student should register with the provincial instructors before intruding into their classroom.
February 26, 1979

Under "CMHC", the grading is "poor" and the comment is: "Course is in a mess-should be investigated". Under "Federal-Provincial Relationships", again the minister failed and the comment reads as follows:
Student lacked the basic skills required for this course-namely co-operation, consultation and agreement.
Under the subject "Graduated Payment Mortgage", again the minister failed and the comment indicates that the "student should drop this course immediately". Under the subject "RRAP", the minister received a "good" grading, but the comment reads: "Needs more effort and greater attention". Under "Attendance", the comment reads:
Student should attend to his duties rather than politicking in Quebec.
Of course that is what the minister is doing today.
Under the subject "Appearance", the minister has received another "good" grading and the comment reads: "Student looks good". Under "Administration", the grading is "poor" and the comment reads: "This trait is noticeably absent from the student". Under "Creativity", the minister receives an "excellent" grading with the following comment: "Student is unsurpassed in dreaming up new schemes". The minister receives a "poor" grading under the subject "Punctuality".


An hon. Member:: What is your policy?


Jean Elizabeth Pigott: Our policy is to get the economy going with mortgage deductibility; that is our policy.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Jean Elizabeth Pigott: The comment under the subject "Punctuality" read: "Student is often late for period of oral questioning".


Some hon. Members:: Right on!


Jean Elizabeth Pigott: The last page of the report card reads as follows:
It is the decision of the testing committee that Andre Ouellet-
The minister does not pass with honours, does not pass with distinction, does not pass, does not pass on condition, and does not fail. Instead, under the notation "Other" the following appears:
Andre is required to take a minimum of four years remedial training in opposition.


Some hon. Members:: Hear, hear!


An hon. Member:: A wonderful report.


The Acting Speaker (Mr. Ethier):: The hon. Parliamentary Secretary to the Minister of Finance (Mr. Martin).


Alan Gray Martin: Mr. Speaker, I wonder if the hon. member would permit a question.


The Acting Speaker (Mr. Ethier):: Will the hon. member for Ottawa-Carleton (Mrs. Pigott) permit a question?


Jean Elizabeth Pigott: Yes, Mr. Speaker.
Housing


Alan Gray Martin: I know the hon. member was a member of a recent parliamentary delegation which went to Washington. A little earlier the hon. member spoke very eloquently in support of the principle of the deduction of mortgage interest for income tax purposes. I know this policy has some trouble finding complete acceptance on the other side of the House. I am thinking of the hon. member for Rosedale (Mr. Crombie) or any member who is from an area with many apartment homes. What was the general consensus the delegation received from the various distinguished people whom they saw in Washington as to the advisability of such a policy? How did the Americans feel about it?


Jean Elizabeth Pigott: Mr. Speaker, I am delighted to have this opportunity; I have been hoping for it all afternoon. We went into the office of one congressman who had been 14 years in Congress. We talked to him about the policy.


Mr. Collenette:: Name him.


Jean Elizabeth Pigott: He is a congressman from upper New York State.


An hon. Member:: Nobody knows the hon. member's name either.


Jean Elizabeth Pigott: In any event, the congressman indicated that the American's dream is to own a home. This is part and parcel of the motivation of many Americans. They dream of owning their own land and, using the words of my Scottish grandmother, their own "but and ben".


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


The Acting Speaker (Mr. Ethier):: The hon. member is on a point of order.


An hon. Member:: Mr. Speaker, she is answering a question. It is not a point of order.


The Acting Speaker (Mr. Ethier):: Order. The parliamentary secretary sought the floor to ask a question and the hon. lady is answering that question.


Mr. Crombie:: Take them one at a time.


Jean Elizabeth Pigott: I will try. This man went on to say that owning your own home has been one of the dynamic measures which produced the great economy of the United States. It was one of the things which I noticed about the politicians. I will agree that the economists did criticize the issue, but in talking to them privately they all said it was one of the things which they could not change because it was so fundamental to the beliefs of the people of their country that they should own homes.


Mr. Hnatyshyn:: We have a social conscience on this side.


Jean Elizabeth Pigott: Secondly, we asked about the renters. My friend has also said that this policy did help the renters because one third of all renters want to own their own home,

February 26, 1979
Housing
one third of the renters are people with special social problems who need assistance, around which the programs should be designed, and the other third are senior citizens who have no wish to own their own home.
Some of my colleagues had a very difficult time in Washington because they knew in their hearts that things were not as they seemed. I ask hon. members in this Elouse if they have ever talked to a revenue man who wanted to cut taxes. I have never talked to a revenue man who wanted to cut taxes, so I discounted the people from the revenue department.
There are so many economists today with their ideas. I listen to politicians because politicians know what the people want, but not the others.


An hon. Member:: Some of us do.


Jean Elizabeth Pigott: The good ones on this side do. I hope that answers the hon. member's question.
[ Translation\


Eymard G. Corbin: On a point of order, Mr. Speaker. The hon. member quoted a member of the U.S. Congress, a New York State representative. It is the practice in this House when quoting someone to give the person's name. I wonder if the hon. member could name the U.S. congressman she claims to be quoting. I think this is important for the current debate.


The Acting Speaker (Mr. Ethier):: Order, please. The hon. member referred to a certain New York State senator or governor but did not quote him. As she did not specifically quote a New York State governor or representative, this rule does not apply.


Some hon. Members:: Oh, oh!


Steve Eugene Paproski: Go back to sleep.


The Acting Speaker (Mr. Ethier):: The hon. member for Madawaska-Victoria on a question of privilege.


Eymard G. Corbin: Mr. Speaker, the deputy whip of the Progressive Conservative party is harassing me, He is not even in his seat. He told me to go on sleeping. I would like-


The Acting Speaker (Mr. Ethier):: Order. I think that all hon. members will agree that if the Chair had to rule on remarks shouted from the various sides it would be very difficult. We rule only on matters relating to hon. members who have the floor. I now recognize the hon. member for Winnipeg North (Mr. Orlikow).


Mr. David Orlikow (Winnipeg North):: Mr. Speaker, the Minister of State for Urban Affairs (Mr. Ouellet) told us in his speech last Friday that Canadians are among the best housed people in the world, that there is no housing crisis in

Canada, that we have an acceptable level of housing production and that the cost of housing is within the financial capacity of those who live in homes. It was such a pleasant and complacent picture that some of us, I am sure, were wondering why we have any housing programs at all and, indeed, whether any are needed.
There is a great deal of distance between the minister's picture of Canadian housing and the experience of the poor people in Winnipeg and elsewhere. Just two years ago the then chairman of Central Mortgage and Housing Corporation, Mr. Teron, made a speech in Calgary in November 1976, and he was quoted as saying:
When 280,000 families in Canada pay more than 50 per cent of their family income for housing, 550,000 families in Canada pay more than 45 per cent, 820,000 families pay more than 25 per cent, and two-thirds of Canadians in need of housing cannot afford to buy or rent without a subsidy from their fellow man, we have a fundamental problem-we must take reasonable action now, or more drastic action later.
Has the situation changed in just over two years from the time Mr. Teron made that speech? Just over a few weeks ago there was a special report on housing which appeared in the Winnipeg Tribune which said among other things:
Several thousand Winnipeg families, including about 3,000 headed by single women, face a bleak winter in housing conditions described as "poor," "substandard" and "dumpy," while three levels of government back away from the low-income housing problem.
Recently, there was a strange situation in my city where the city council, composed mostly of Conservatives, refused to go ahead with a $1 million low-income housing project, despite the fact that in so doing they were rejecting substantial amounts of money offered by the federal government and the provincial government. The federal response to the reality of low income policy was nicely summarized by a CMHC regional economist in Winnipeg, Mr. Karl Falk, who said:
Our official party line is that housing is a provincial matter, we are only in there by default.
No provincial government has the financial resources to singlehandedly tackle the housing problem, but we in Manitoba must deal with a Tory provincial government which has not authorized any new family public housing since it took office. They want to see if there is a need, according to the chairman of the provincial housing corporation, before they go ahead.
One group which the minister did not listen to while deciding that Canada has no housing problem is the Institute for Urban Affairs in Winnipeg which, incidentally, is headed by a very prominent Fiberal, Mr. Floyd Axworthy, the man who they would like to see as a Fiberal candidate in the next federal election and who spent several years in Ottawa as special assistant to the then minister of housing, Mr. Hellyer. The institute's assistant director said in the same issue of the Tribune:
It leaves me very disturbed because someone has to take responsibility for making sure housing needs are met. No one seems willing to play that role, and the private sector is not going to pick up the slack.
That is what that institute thinks of the federal government's so-called housing policy.
February 26, 1979

There is a great deal of slack in the Winnipeg housing situation which could be taken up. A recent report found that my city has both a large stock of older, poor quality, deteriorating housing in the inner city and an inner city community which is deteriorating in strength and vitality. Thirty-seven per cent of Winnipeg renters pay more than one quarter of their income on rent, a situation which is worse only in Vancouver among the major Canadian cities. People in Winnipeg see nothing in the housing situation about which they can be complacent, despite what the minister said last Friday.
What will be the effect of this bill when it is enacted? This bill will implement the changes which were included in the amendments to the National Housing Act last May under the title "New Directions in Housing." This statement called for a number of things, among which were included:
-an end to the generous aid to co-ops and non-profits started during the minority parliament and its replacement by less expensive subsidies.
-an end to rent supplements (50-50 federal-provincial) for co-op, non-profit, provincial or municipal housing units.
-an end to loans to provinces or municipalities for the construction of public housing and to the 50-50 sharing of operating losses in such projects; CMHC will continue to offer provinces a partnership arrangement in public housing (federal government pays 75 per cent of capital cost and operating losses).
The provinces do not care much for this option as it involves too much interference by Central Mortgage and Housing. One of the goals of the new directions was supposedly to end this type of interference.
There is also an end to the assisted home ownership program and an end to the assisted rental program-both of which received such glowing comments when they were proposed by this government-and the introduction of the graduated payment mortgage which was insured but not offered by CMHC. Like AHOP, it simply postpones the monthly mortgage payment you cannot afford now to a later date when your situation will be even worse.
There was also the expansion of the types of mortgages which CMHC can insure to make up for the fact CMHC no longer lends money. There was an expansion of the residential rehabilitation program, but without the funds to implement it. There was an end to the municipal infrastructure program for water and sewer construction, the municipal incentive program which provided grants for medium density housing, and the neighbourhood improvement program and its replacement by the community services program which provides less money for a wider range of projects.
I should like to quote again from the article in the Winnipeg Tribune of January 31, 1979, on the effect of just one of the proposals. Referring to the non-profit housing program, the article reads as follows:
Under the old program, CMHC provided low interest loans for such non-profit housing corporations as the provincial government's MHRC and native people's KINEW. While it attached the string of rents held to 25 per cent of tenants' incomes (where rental housing was involved), it made that string elastic through rent supplements. Under the new program, financing must be obtained through the private sector-
Housing
The private sector does not want this burden.
-although the federal government will provide generous interest reduction grants. But to qualify for the grants, the non-profit corporations must meet the 25 per cent rental requirements without the elastic feature of rent supplements. Section 44-IB of the National Housing Act, which provided for rent supplements to fill the gap between the cost of housing and the 25 per cent of income standard of affordability, has been discontinued.
Stan Fulham, head of KINEW-
KINEW is a native housing organization which has done a very fine job of providing housing for native people in Winnipeg.
-the non-profit corporation geared to provide housing to native people, figures the program won't be much help for low income families. "Even with a two per cent interest rate, you're still taking $200 or more a month. So for the low income people, it's no help. KINEW's going to be forced to discriminate. If there's no subsidy available to them, they just won't be able to afford our housing. They'll have to take substandard slum housing."
That is what one of the most active groups which provides housing for people in Winnipeg who cannot afford housing in the conventional way has to say about the government's proposals.
I want to look now at the community services program which groups together all the old programs such as non-profit housing, co-operative housing, sewer and water extention, the neighbourhood improvement program and so on. The government says it is willing to adopt a global approach to its financial aid to municipalities, and to achieve this it proposes to take ten individual programs, each of which requires well in excess of $25 million for Canada as a whole, and lump them together to produce what it calls a new global approach, for a maximum of $250 million per year instead of the $339 million which was allocated for all these programs last year. That is an economic sleight-of-hand. The government expects the provinces and the municipalities to thank them for this.
The federal government has indicated that it wants to produce flexibility and wider latitude for the provinces and municipalities in using federal funds, to enable federal assistance to better respond to local needs and conditions, to reduce duplication and to ensure that assistance is available equally to all provinces.
We must look beyond the kind of rhetoric the minister used last Friday. As we have seen many times before with this government, rhetoric and action are clearly two different things. To the extent that this program is obviously long on rhetoric, it is correspondingly short on action. It is particularly short on funding, Mr. Speaker, which, as I have already indicated, has been cut back very substantially this year because of the government's restraint program. It uses expressions like "great" and "ongoing", but what do they mean? In 1973, after an irresponsible delay of five critical years during which urban renewal programs were cut off, the new NIP program was brought forth. In 1978, almost before most municipalities learned to make effective use of the neighbourhood improvement program, the government took it away, merging it with such a variety of other demanding programs that it will be, in effect, emasculated.

February 26, 1979
Housing
A close look at the neighbourhood improvement program and its operation shows exactly how it was emasculated. Under the old legislation, if an area was designated for improvement under NIP it was automatically eligible for the residential rehabilitation assistance program. Now under the community services program there is no guarantee that RRAP funding will be available to people in the neighbourhood improvement area. The neighbourhood improvement program will fail without those rehabilitation funds. That failure will be felt by the residents of neighbourhoods in the Winnipeg area such as the Chalmers area in Elmwood and the Daniel McIntyre area in west Winnipeg. These areas had hoped to be able to benefit from the program which since 1973 have made a great difference in other Winnipeg neighbourhoods which have benefited from the start of them.
The necessity of keeping the automatic link with the neighbourhood improvement program and the residential rehabilitation assistance program was illustrated in the Point Douglas project, a Winnipeg neighbourhood which had become quite run down. There are between 650 and 700 dwellings in that area. They received 480 RRAP loans with the result that it is now a much better neighbourhood for people to live in and to raise their families. The same thing can be seen in other neighbourhood improvement programs around Winnipeg. Point Douglas received RRAP grants for 70 per cent of the homes. There was also RRAP funding for 280 homes in the Centennial area, representing between 50 per cent and 60 per cent of homes in that area. In St. Boniface 40 per cent of homes under the NIP program received RRAP funds. It is estimated that under another NIP program in the William Whyte area about 80 per cent of the homes will need RRAP money for rehabilitation. This is at a time when the government has decided to cut back on the amount of RRAP funding and make it more difficult to obtain.
There has been a direct relationship between the use of funds to improve a neighbourhood and funds to rehabilitate the housing in that neighbourhood. However, community services grants for those two purposes will not be automatically linked. They will just be part of the many deserving programs that must suddenly make do with a much smaller global budget. This is going to deny the chance of real improvement to many neighbourhoods in Winnipeg. What is true in Winnipeg is true in other cities across Canada. The government does not care. Instead of worrying about these neighbourhoods it is involved in a game it has been playing for years-offer the neighbourhoods, the communities and cities of Canada lots of sizzle and when they try to taste the steak, pull it away.
For the past ten years, in fact for the past 35 to 40 years, extensive areas of housing and urban development have been built in this country without adequate storm sewers, community facilities, solid waste disposal, urban transport and many other essential services. For the past three years, for example, AHOP has been touted as a great solution for moderate income housing. But housing in what kind of urban environment? In my own area the best municipal officials can suggest, to prevent a brand new AHOP and NHA financed housing
[Mr. Orlikow.l
project from having basements flooded with raw sewage five or six times a year, is to fill a nearby artifical lake built for storm water retention and to divert raw sewage into it. What a commentary on the kind of planning this government has done in recent years!
This housing was built by developers who are well known supporters of the Liberal party. It got CMHC approval and encouragement to build on lands which were totally inadequate with respect to storm and sanitary sewage facilities.
With problems like this burgeoning in urban developments across the country, even if $100 million out of the proposed $250 million was used to correct problems such as those which have been created in my constituency, it would be barely enough to finance a fraction of what needs to be done to correct damage resulting from poorly administered NHA programs.
In other words, the Liberal government in Ottawa wants to bail out and leave the province and municipalities with inadequate funding to clean up the mess left by its ill-conceived programs. Furthermore, in the mad rush to get starts in place, no precautions were taken. Its funding arrangements are not even equitable in terms of the population of the regions of the country. In Manitoba's case, instead of receiving $12'/2 million it has been offered only $10 million.
Before getting away from this subject, I want to warn the minister that as a result of a decision handed down last week by the Supreme Court of Canada which held that a municipality which had drained part of a suburb of Ottawa without taking adequate precautions so that homes already built had substantial damage done to their foundations was responsible for this situation and would probably have to pay damages. I hope that the residents of my area will go after the city and the developers who were so negligent that they built over 1,000 houses without providing for the run-off of rain water, which resulted in houses being flooded, although they should have known and I think did know that they were not providing adequate storm sewers for the area.
What about Canadians who presumably manage to purchase their own homes? Despite what the minister said, Canadians are house poor. The high cost of housing is absorbing a large portion of an individual's total income every year. We had better start looking carefully at our assumptions concerning housing and land. Since 1945 the single family dwelling located on a large lot has become the ideal form of housing which most Canadians aspired to. In the 1950s it was possible for the average Canadian to own his own home. A generation later his sons and daughters cannot do the same thing.
Each week I receive a list of new homes purchased in the city of Winnipeg. I look particularly at the ones purchased in my own constituency. From this list I can see people who are buying homes at prices of $60,000, $70,000, $80,000 and $90,000, and I wonder how they will manage to make the mortgage payments on those homes. They have committed
February 26, 1979

themselves for the next 25 years to monthly payments that run anywhere from $300 to $600 a month. This is a burden which many of them will find impossible to carry in the next few years.
In spite of the increase in family income since 1961, the ability of people to afford a house in those cities has actually decreased. A study done in Winnipeg comparing 1961 and 1975 prices found that family incomes had increased by 100 per cent in that time, but the price of a new house in the suburbs had increased by 152 per cent. And if you add to that the increase in monthly payments which reflects both higher housing prices and higher mortgage interest rates, the increase was 219 per cent.
Right now the average price of a house in metropolitan Toronto is $68,500 and it is anticipated that the price will rise another 7 per cent to 8 per cent over the next year. In the central core it is even higher; the average there is $80,000. With mortgage rates now at a high of 11.25 per cent, the dream has become almost unattainable. Just who is buying houses?
In the few Canadians cities where suburban lots are still reasonably priced, moderate income families can still afford suburban single family houses. In 1976 in Halifax 66 per cent of all new house buyers under NHA had incomes of less than $15,000. In Saskatoon 56 per cent of all new house buyers had incomes less that $15,000. Those were two cities where some lots were controlled by municipal government. But in cities with high land prices the figures are very different. In Toronto only 7 per cent of new house buyers had incomes less than $15,000. In Winnipeg it was 8 per cent and in Edmonton only 4 per cent.
It would appear that moderate and low income families are unable to afford the great Canadian dream of owning their own homes. The housing market presently caters to the middle and upper class. Today's typical family needs an annual income of nearly $30,000 to buy a new home in metropolitan Toronto. One of the reasons for the very substantial increase in the cost of a home in Canada has to do with the cost of land. That is something we should be looking at very carefully. The cost of raw land has increased, but in the total cost of lots it is a relatively modest factor.
It has been the practice of many developers to assemble private land banks in anticipation of future needs. What one CMHC researcher discovered is that a small number of developers hold enough land to supply all new suburban lots which will be required for the next five to 15 years. And because they control the land assemblies, a few developers are able to control the market in ways that lead the price increases for suburban house lots. Between 1971 and 1976 house prices have doubled in most cities. The price increases are not from higher costs of production, but rather from increases in profits developers have made on the land. A recent study has documented that profits by the large suburban land developers added $7,000 to $10,000 to the price of new $50,000 homes in Regina and Winnipeg. In cities like Vancouver, Calgary, Toronto and Ottawa profits added $15,000 to $24,000 to the
Housing
price of a $60,000 home. Just west of Toronto the Peel housing task force found that profits on lots were 22 per cent of the final selling price of the house.
It is large land owners making windfall profits on the sale of their property who are escalating the cost of housing. Land, urban land in particular, we believe should be treated as a scarce resource in much the same way as other natural resources. Under the present system we are allowing a few people to effectively control the supply and cost of land. But it is not only the cost of housing that they control; they also dictate the options as to the kind of housing available. It is either housing everyone wants but few can afford, or housing that everyone can afford but few want.
If hon. members doubt my charge that the developers are making exorbitant profits, let me quote from an article which appeared in the Winnipeg Tribune dated October 31, 1978. This article was written by Val Werier who writes a column almost every day in that newspaper. It reads:
In northwest Winnipeg-
This is an area within my constituency.
-a market gardener sold his 32 acres in 1973 for $64,000, or $2,000 an acre. In 1977, the new owners were listing it at $500,000. This year they are asking $688,000 or about $21,000 an acre.
That is quite an increase in just six years. The article goes on to say:
Within the past five years, the asking price for some land in the northwest corner of the city has risen tenfold, according to one real estate agent.
"The speculators are taking homebuyers for a ride because of the high price for land," he says.
The real estate agent notes, for example, that eight acres were sold in 1975 for $72,500 near the site of the Seven Oaks hospital, now under construction. Today, the asking price for this raw land is about $400,000 because the new owner can capitalize on the huge public expenditures in the form of a hospital. The hospital will attract new developments such as apartment blocks.
That is the situation which we now face. The survey of housing units has provided new and up-to-date data that permit a better identification of the number of households suffering from some form of housing need, either dwelling unit inadequacy, overcrowding or problems of affordability. Overall about 60 per cent of all households in urban Canada had none of the above problems in 1974. About one third, or 1,025,000 households, have one problem only. Another 7 per cent encountered two or more problems and therefore had serious shelter inadequacies.
Of the approximately one third of 1,025,000 households that were suffering from some form of housing deprivation, 180,000 were living in inadequate dwellings, 298,000 were overcrowded and 547,000 were paying more than 25 per cent of total household income on shelter. Affordability therefore emerges as the largest single housing problem. Yet, Mr. Speaker, in his speech the minister did not pay any attention to the question of affordability. Listening to the minister, one would assume that he believes no one in Canada has any problem with affordability.
3594

What we need to do, in our view, is provide funds for the projects covered by the community services program, and the $250 million proposed is not adequate. Second, we believe we should provide for co-operative, non-profit public housing. That money is not included in the estimates we have for next year. We believe the government should bring back its land assembly program.


An hon. Member:: What?


David Orlikow: We need to stop the rip-off which has taken place over the last number of years by developers who have made, are making and will make tremendous and exorbitant profits unless governments at three levels step in to carry out this land assembly program.
In addition, we need to provide adequate funds for the residential rehabilitation assistance program, and the estimates for next year do not provide for that. We need to force the banks to set mortgage rates at 8 per cent for families with incomes of $20,000 or less who want to buy homes that cost less than $50,000.
Those are the minimum steps we believe are necessary if we are to meet the housing needs of the people of Canada. We certainly do not see those steps in this bill and we do not see the funds provided for in the estimates we have before us for the coming year. We did not hear about these things in the speech of the minister last Friday. For those reasons we certainly intend to vote against this bill.


Mr. Art Lee (Vancouver East):: Mr. Speaker, it is indeed a pleasure and an honour to participate in this debate. I should like to support these amendments to the National Housing Act for a number of reasons. During the debate so far we have heard a considerable amount of discussion in respect of the mortgage deductibility program proposed by members of Her Majesty's Loyal Opposition. Recently, as the House knows, an all party committee went to Washington to examine with U.S. representatives and other officials the issue of mortgage deductibility. The all party committee was comprised of the hon. members for Vancouver Quadra (Mr. Clarke), Ottawa-Carleton (Mrs. Pigott), Broadview (Mr. Rae), Westmount (Mr. Johnston) and Stormont-Dundas (Mr. Lumley). In a memorandum prepared by the hon. member for Westmount, he concluded:
A recommendation of all government officials and all independent economists with whom we met was to the effect that a system of mortgage interest or real estate tax deductibility is to be avoided at all costs.
The hon. member for Westmount went on to say:
Because the proposed deductions favour high income owners the measure is regressive, and in lieu of promoting tax neutrality it offends the principle, because it discriminates against tenants and non-homeowners. Because it selects only real estate taxes for deduction there would be a shift of local taxation into the real estate tax area with less emphasis being placed in other areas of local taxation.
Because of the regressive nature of this provision the benefits derived would tend to favour owners of existing homes, providing them with more disposable incomes while doing much less for income groups anxious to enter the housing market, and doing nothing for those at the low end of the income scale without sufficient income to take advantage of these deductions. The effect of this would
Adjournment Motion
be to widen the economic gap between the rich and the poor, between home owners and non-home owners.
Adequate studies have not been performed to determine what impact the deductibility of mortgage interest and real estate taxes would have on urban communities. For example, to what extent would the centre core properties be purchased and renovated as the result of this scheme, driving tenants and owners in these low income areas into substandard housing and substandard accommodation? What impact would this particular mortgage deductibility scheme have on the urban sprawl and on the pressure for condominiumization of apartments, with the resulting impact on our tenant population?
In brief, no fiscal program which would alter the basic structure of the tax system should be introduced without the most thorough study and analysis of the kind now being carried on by the Urban Institute for HUD in the United States. Once in place it cannot be easily modified and its social consequences can be farreaching.
Because of its regressive nature I reject the proposal of Her Majesty's Loyal Opposition. Instead, I firmly believe that a tax credit system would be more beneficial as it assists low income earners regardless of whether they are home owners or renters. Also the use of tax shelters would help people like senior citizens who need more direct assistance because they are not able to have the advantage of progressive incomes.
In short, I agree wholeheartedly that shelter tax allowances will provide assistance to home owners and tenants alike through payment of a tax credit shelter expenditure exceeding a certain percentage of income in the right way. As I indicated, I support these amendments to the National Housing Act for a number of reasons. They represent a reasonable approach to housing problems across a very broad front.
I am particularly pleased that the bill preserves and extends one of the most important housing measures ever put forward here in Canada. I am referring to the residential rehabilitation assistance program, otherwise known as RRAP. I am delighted to see that the government has removed or intends to remove the restrictions from this program, that its benefits are no longer going to be restricted to certain designated areas but will apply to Canadians wherever they live. With the passage of this legislation all Canadians will become eligible for RRAP assistance within the terms of the program, and I have no doubt that the funds available to support it will be applied to more pressing needs wherever they occur in Canada.
I am not surprised that RRAP met with such immediate enthusiastic response by the people of Canada. RRAP and its twin, neighbourhood improvement, actually originated in the Strathcona area located in my riding.
If it is the pleasure of the House, may I call it five o'clock?



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Turner):: Order. It is my duty, pursuant to Standing Order 40, to inform the House that the

February 26, 1979
Farm Income Stabilization
questions to be raised tonight at the time of adjournment are as follows: the hon. member for Kootenay West (Mr. Brisco)-Airports-Navigational aids and firefighting equipment for Castlegar, B.C.; the hon. member for Surrey-White Rock (Mr. Friesen)-Fisheries-Negotiations respecting Alaska coast halibut fishery; the hon. member for St. Boniface (Mr. Hare)-National Revenue-Sales tax on storm windows and doors.
It being five o'clock, the House will now proceed to the consideration of private members' business as listed on today's order paper, namely, notices of motions and public bills.


PRIVATE MEMBERS' MOTIONS
Mr. Penner:: Mr. Speaker, I think there is unanimous consent that we proceed with notice of motion No. 18 and that preceding notices of motions be allowed to stand and retain their precedence.


The Acting Speaker (Mr. Turner):: Is it agreed that motions Nos. 7, 9, 16 and 17 stand by unanimous consent?


Some hon. Members:: Agreed.


AGRICULTURE
Mr. Stan Schellenberger (Wetaskiwin) moved:: That the Standing Committee on Agriculture be empowered to study the advisability of instituting an individual rather than aggregate program of income stabilization for the western producer, and to report its findings to the House.
He said: Mr. Speaker, over the years I have given much thought to stabilization as a means of helping farmers in all of Canada but particularly in western Canada, and as an attempt to eliminate the so-called hills and valleys in the production of commodities and in the prices producers get for those commodities. We have examined various plans in order to accomplish this. Producers have attempted to accomplish it by means of supply management marketing boards. Various government stabilization plans have been instituted and a number of income tax techniques are available to farmers, but it is my belief that members of parliament and the Standing Committee on Agriculture as a whole should take a very serious look at individual stabilization as the plan of the future in order to help farmers adequately stabilize their incomes.
Since I arrived here as a member in 1972 I have considered it a pleasure to serve on the Standing Committee on Agriculture because I have felt it has always done an excellent job of dealing with questions put before it. I remember that when it was dealing with the Western Grain Stabilization Act the committee travelled to western Canada to learn the opinions of western farmers as to whether we should have that legislation and, if we should, whether amendments or changes should be
[The Acting Speaker (Mr. Turner).]
made to it. I found at that time that a number of members were questioning whether we should have aggregate stabilization, that is, stabilization of the whole area, or individual stabilization of some sort which might be better suited to regions or to particular problems.
While the committee was on that trip, this question was asked many times, and I have here a few responses from witnesses who came before that committee. One response came from the hon. John Messer, then minister of agriculture of the province of Saskatchewan. He said:
The plan does not provide individual commodity or regional income stability. No account is taken for regional, geographic and climatic factors which influence the production of various grains throughout the prairies.
When we were in Manitoba the hon. Sam Uskiw, the then Manitoba minister of agriculture, said:
It seems to me that since the proposed grain stabilization act is being portrayed as an income insurance scheme and since it is a contributory plan, farmers should know what insurance they are buying; in other words, the plan must relate to the needs of individuals, and it should be possible for individuals to determine what benefits would accrue to them if the events against which they are insuring themselves should occur.
Many members of the committee felt that the plan should be individual and perhaps administered by the crop insurance plan, which is active all across the prairies and has offices throughout the regions and people who are constantly travelling among farms. Here is a natural set-up by which an individual plan could be established. The hon. member for Moose Jaw (Mr. Neil) came up with a plan, and during a good part of the time he had in the committee he discussed whether an individual plan could be set up which could be administered by the crop insurance people. I also felt that there should be an individual plan, and I remember asking the then minister of agriculture of the province of Manitoba what his thoughts were. He stated them as follows:
If it was possible to base stabilization on the individual, that would mean that the province would have to administer it and I suspect the best way to administer it would be through crop insurance machinery that is already set up.
I do not necessarily agree that the plan would have to be administered by the province, but the then minister did state that he felt that the crop insurance people could administer such a plan.
The Palliser Wheat Growers Association stated the following:
If individual stabilization is the objective, the plan would be more effective if dovetailed with existing crop insurance programs.
I now come to the point where I must state that I fully believe that the individual stabilization method is the ultimate program for Canada, and I fully believe that if the Standing Committee on Agriculture were to study such a method, the majority of members of that committee would come to have the same opinion.
I would have no objection if we were to broaden my motion so that we could study a stabilization plan which would guarantee margins. I know that the Minister of Agriculture (Mr. Whelan) has been discussing this with the provinces. Rather than having a 90 per cent level, the minister has been discussing perhaps a 100 per cent level plus cost of production
February 26, 1979

and other changes. However, I think members of parliament should get involved in such a study because farmers face rapidly rising production costs, to the extent that tractors and other machinery now cost two to three times more than they did only five years ago.
Because we are an exporting nation, world production fluctuations have a great influence on what the Canadian farmer earns. We have to give farmers a reasonable return on their investment or they will continue to leave agriculture and flock to the cities. That is why I introduced this private member's motion today. I am asking hon. members to give the Standing Committee on Agriculture the power to study the principle of stabilization on an individual basis. By doing so, hon. members might become informed about the benefits of such a plan. We must take this opportunity to achieve improved farm income stability at the farmer level.
Hon. members might say that there are a number of programs in place at the present time to do just that, and I agree that there is some truth in that. The first ones which come to mind are the Western Grain Stabilization Act and the Agricultural Stabilization Act. Those are both aggregate plans, and they cannot take account of regional and climatic factors and decisions of individual farmers as to what crops they plant, weed control, whether they stay in hogs or increase production of cattle. They do not take account of crop markets or price, which is often determined by world factors.
Of course, there is always government interference in the agricultural sector, and an aggregate plan cannot take account of that. Those plans are slow to pay. That was demonstrated by the first pay-out under the western grain stabilization plan. It took the government a year to make its first full payment. Half of it came six months after it should have come, and the other half came a full six months after that. There is a very complicated trigger formula which must be followed before payouts can be made, and there is also some room for the minister to decide when it is most politically advantageous.
There is another factor, and that is that one commodity can have an enormous effect on whether the trigger mechanism comes into play. Under the western grain stabilization plan wheat in the province of Saskatchewan bears too heavily on the trigger mechanism, and under the Agricultural Stabilization Act regional factors are not taken into consideration. Beef prices in Toronto are always five cents to seven cents higher than they are in western Canada, and because of that the averaging mechanism does not reflect the average price of beef in western Canada. So I find that these aggregate plans do not take into account the needs of the individual farmers. When a pay out occurs it benefits them, but in many cases when the need is there the stabilization plan is not.
Then there are such techniques as block averaging and general averaging, but the benefits of both tend to be in the years when farm incomes are the highest and the farmers do
Farm Income Stabilization
not really need them. We have deferred cash purchase tickets which are only available to grain farmers and also are used in high income years. Some farmers can use year-end purchasing as a stabilization factor. If they have a good year, they can buy their tractors before the end of the year. We can also have deferred sales. In effect, this is an individual plan because the farmer does not have to sell his grain; he can keep it in his bins and sell it the following year. But that does not help the Canadian economy because we must bring in foreign capital by selling our agricultural produce.
Then there is capital cost allowance, which is really depreciation and has been used for a number of years to help in income control.
All these programs are available, but true stabilization for a farmer on an individual basis does not exist today.
Some farmers are now attempting to use RRSPs for their own individual stabilization, but because withdrawals are limited-you cannot make partial withdrawals under this plan-farmers have to incur the cost of setting up many plans so that when they need money, they can draw from one of the plans and still have some money available for other years. This is complex but it shows that it is really what these farmers want. They are using what laws are available now to do just that.
I have come to the conclusion that none of these plans offer the individual the type of stabilization he needs; nor do they reward efficiency or good management or allow farmers true protection in the case of individual disaster. All across Canada there are problems such as brucellosis or IBR in cattle and various diseases in poultry and hogs which cannot be covered under an aggregate plan but which could be covered under this individual type of plan. We can have a significant price drop in one commodity in western Canada, such as, for example, in barley or rapeseed, but because of the importance of wheat in the western grain stabilization plan the price drop will not trigger aggregate plans; so again these farmers will suffer.
That is why it is imperative in these times of the fluctuating dollar, inflation, world conflicts, rising input costs and increasing consumer resistance to rising food costs that we study and implement an individual stabilization plan. I believe that the committee should start by examining thoroughly the very excellent study that was done by Peat, Marwick and Partners for the Alberta department of agriculture entitled "Feasibility of an Income Averaging Trust Account". The objectives of this plan were that farmers deposit a portion of their income during high revenue years and withdraw funds in lower income years. The main objective was to stabilize the income of the individual farmers on a voluntary basis and at the same time provide indirect stabilization for rural and general economies.
The study outlines a number of concepts with which I totally agree. There are eight of them; that the minimum deposit be one year and the maximum deposit be seven years; that minimum deposits and withdrawals be SI,000 and the maximum amount of the total deposit be $100,000; that in the years that money is withdrawn, no deposits could be made; that only farmers between the age of 18 and 70 would be

Farm Income Stabilization
eligible; that participation in the trust account would be voluntary; that only income from farming operations would be eligible; and that withdrawals would be considered non-farm income and could not be used for block averaging.
They have laid down the basis on which an individual plan could work through a great deal of study and by talking with farm organizations and farmers about what they think they need. I spoke with the unifarm people in Alberta and found them to be in total agreement that we should study the plan as the ultimate stabilization plan for farmers. The impact of the study is to help stabilize the rural economy in the price of farm supplies. This would benefit medium, large and small farmers alike, and in addition it would be of benefit to the government taxation department because revenues from farm income would tend to fluctuate less.
The study has helped us as well because it encompassed all stabilization plans that were available in various countries of the world and concluded that a plan which is now available in New Zealand best fits the idea put forward by the Alberta department of agriculture and studied by Peat, Marwick and Partners. The New Zealand plan has been in place since 1965 and is known as the farm income stabilization scheme. It allows farmers to deposit up to 25 per cent of their gross income into income equalization accounts. The concept of the plan is quite similar to what I have just outlined.
I should like to state in conclusion that here is an opportunity for members of parliament to improve farm income through individual stabilization by passing this motion. The ancillary effects on the total agricultural economy, levels of inventories, farm equipment and supply purchase patterns and the smoothing out of federal and provincial taxation incomes are all important and tend to create an environment where planning and production management techniques could become more effective. In future this plan, with more study, could replace the western grain stabilization plan and the agricultural stabilization plan by having regional triggers in place wherein producer accounts would be supplemented by government payments and producers in various commodity groups would get stabilization help from federal assistance, as is now the case under the western grain stabilization plan, through their individual accounts.
I thank the House for giving me the opportunity to put this motion before hon. members and I hope they give it their serious consideration.
[ Translation]


Mr. Irenee Pelletier (Sherbrooke):: Mr. Speaker, first I should like to congratulate the hon. member for Wetaskiwin (Mr. Schellenberger) for his motion. I must say in support of the hon. member that I had often the opportunity to meet him during the two years when I was parliamentary secretary to the Minister of Agriculture, and his contribution to the Standing Committee on Agriculture was always of the highest standing.
This motion, Mr. Speaker, also indicates that the hon. member is much interested in agriculture. I must admit that
[Mr. Schellenberger. 1
even, as I have just said, if I had the honour to serve as parliamentary secretary to the Minister of Agriculture, there are very few farmers in my constituency. There is, of course, the experimental farm of Lennoxville which, I must say, has substantially contributed to the promotion of agriculture in Canada, performing very important research work and serving with outstanding diligence the farmers of Quebec and of the Eastern Townships.
Of course, even if there are not many farmers in my riding, God knows that agriculture and every other aspect of the food industry affects everybody. In the speech he has just made, the hon. member raised some very interesting points which should be taken into serious consideration. However, I should remind hon. members that the Department of Agriculture helped farmers tremendously in the last few years. Take, for example, the two extremely important pieces of legislation which were passed by the House during the last six years, and which were greatly supported by hon. members on the opposition side, and particularly by the mover of the motion which is before us today.
Mr. Speaker, I also want to mention one of his colleagues, the hon. member for Medicine Hat (Mr. Hargrave) who always made a remarkable contribution in the Committee on Agriculture which demonstrates that he is particularly concerned with the agricultural segment of our society and with the interests of his constituents.
Mr. Speaker, the markets are a lot more unstable in agriculture than in most other sectors of the economy. Therefore, the income levels of farmers vary much more than those of other Canadians. This greater uncertainty is a source of great difficulty for farmers and very often slows down the development of agriculture. The inputs and outputs of resources from the production sector, depending on price fluctuations, result in higher production costs.
On the other hand, farmers may be persuaded to renounce certain monetary advantages of specialization, for by varying their crops, they may count on a more stable income and attenuate some of the risks resulting from the slowing down of a market due to the application of modern technology. The climate of uncertainty in which producers live quickly spreads to their suppliers of goods and services and their purchasers of farm products. Finally, their effects are felt on the economy as a whole. Because of the problems resulting from the instability of farm markets, the House has finally adopted stabilization legislation for wheat and other grains.
The programs applied under these two pieces of legislation lessen the effects of unstable markets by ensuring that, during more difficult times, producers will receive support payments which increase their incomes to a level which represents a certain percentage of the net eligible grain sale proceeds for all producers for the year under review. That is exactly what the hon. member who has introduced this motion claimed a while
February 26, 1979

ago. Since the computation of the support level takes these proceeds into account, Canadian farmers will continue, as indeed they should, to base their decisions concerning production on the fundamental tendencies of the prices on the market place.
Mr. Speaker, the stabilization mechanism gives good protection to the farmers against the fluctuations mentioned by the hon. member, but it has much less influence on permanent decreases in market prices since these influence the support levels. All producers receive the same supplementary payment by production unit under these two stabilization programs, this aims at ensuring that the position of each farmer in relation to the others is not changed by the stabilization program.
Mr. Speaker, I would like to say a few words about the Agricultural Stabilization Act. Even though the programs established under this act have remained within the spirit of the previous act, passed in 1957 or 1958, certain changes have been made to the policy to meet the new requirements of farmers. The first act included provisions for designated products. These were products which had to be supported at a level set at 80 per cent of the average market price in the last ten years or the ten previous years. The government was empowered to increase this minimum level it deemed appropriate. However, non-designated products could benefit from support if need be, but always at the discretion of the minister. The support price of these designated products was equivalent to the ten-year average percentage judged appropriate to absorb losses on the market. The amendments which resulted in the 1975 act have been very beneficial for the farmers. The amendments concern mostly the list of designated products and the formula for establishing the support prices.
Certain designated products were not listed in the 1958 act, and this shows the significant improvements which were made in the new legislation. For instance, the designated products now include steers, pigs, sheep, industrial milk and cream, corn, soya, as well as oats and barley produced outside the zone designated by the Canadian Wheat Board. The minimum support level for these products was set at 90 per cent of the market price during the previous five years.
This is the major difference between the legislation passed in 1958 and that passed in 1975. In the first case, the support level was set at 80 per cent of the prices during the previous ten years, while the support level is now based on a five-year period, which is much more reasonable and much more advantageous for the farmers. In other words, instead of 80 per cent, it is 90 per cent of the last five years. The minimum rate has thus been increased by 10 per cent and the period considered has been lowered from ten to five years. Just as the 1958 act, the revised legislation provides the increase, if need be, of the minimum rate of assistance and the designation of other products for assistance purposes. And we can add to that the problems pertaining to the present agricultural products stabilization program. Also, we all know that apart from this legislation there were the two acts I mentioned in the beginning, namely one on stabilization and one on wheat.
Farm Income Stabilization
The implementation of the 1975 act has brought to light a certain number of problems, namely that some producers consider the rate of assistance too low. In that respect, I think, as the hon. member mentioned about midway through his speech, this deserved some consideration in certain instances, and I believe that the government did indeed, two or three times, increase the amount of assistance granted for certain products. But there again I agree with the hon. member that in certain cases it is clearly too low because imports, that is certain products that cost a lot more in the farmer end product, are not always included. For a lot of producers, not disclosing the support price before the production period also contributes to reduce considerably the extent to which programs lessen the climate of uncertainty.
Cow calves are not on the list of specified products and it is perhaps a lack that should be corrected. A number of pork and cattle producers feel the present program does not protect them adequately and they have to reduce the support period. Here again, producers of these two commodities expressed on several occasions-and I remember on two occasions at the Department of Agriculture-certain claims they felt the government should consider.
Although the legislation included provisions for an increase in the basic rate and its financing by producers no procedures were developed for that purpose. There again, although those two pieces of legislation are in the interest of farmers I believe certain amendments could be brought in, and, of course, the Minister of Agriculture (Mr. Whelan) is always prepared to change the existing laws to suit them to current conditions.
Mr. Speaker, I know for having worked with our Minister of Agriculture-who incidentally has been there for seven years-how farmers both in western and eastern Canada appreciate the interest and constant concern he has to fight both at the caucus as well as the ministers' level to ensure farmers get the most and are protected against inflation and certain other economic difficulties. We all know that farmers or agriculturists are perhaps the most vulnerable class in our society because, in addition to the difficulties every group faces, they have to live with the uncertainties of the weather over which they have no control; that is why this government passed legislation to protect them a bit more against bad weather, both literally and figuratively.
Since the act, as amended in 1975, has come into effect, a number of provinces, Mr. Speaker, as should be pointed out here, have adopted their own stabilization programs. Still, the federal government is concerned about the variety of programs implemented with regard to goods produced and sold throughout Canada, because varying levels of support from one province to the other could be a source of numerous problems.
Of course, Mr. Speaker, the federal government does not disagree with the fact that some of the provinces have decided to give help to agriculture. What it is concerned about is the diversity of those programs. Some provinces being richer, they can offer much more than other provinces; consequently, there

February 26, 1979
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are two classes of farmers in Canada. That is why the Minister of Agriculture has always taken great care to avoid such differences as much as possible. There are enough regional disparities in Canada as it is, which of course we are trying to remedy, but incentives however should not be provided through programs that vary so much from one province to another, although they are valid in themselves. The constant goal of the Minister of Agriculture has been that all those programs help farmers equally across Canada. This is why federal programs have tried to integrate most of the stabilization programs as much as possible and to the extent provinces are willing.
Because each province wants to protect farmers, there could be a run on levels of support, and producers in more generous provinces would naturally have an edge on their counterparts in other provinces, and production could slide to more generous provinces. It is my view and indeed the view of farmers, as will be recognized by the mover of the motion, that with such a range of programs we could eventually get to the point where some provinces could, by reason of their location, economic base and a host of other factors, stimulate producers through generous and acceptable measures into raising their production to a level that would harm producers in other areas, and although this could have short-term benefits for a small number, it certainly would be harmful on the longer term both to themselves and farmers throughout the country. For that reason, federal programs must work across the land and be as generous as possible, while avoiding that some provinces benefit more than others.
On the other hand, this country could get into difficulty with its trading partners, who look badly toward what they feel is unfair subsidizing of Canadian products. The Canadian government and provinces held detailed discussions on all the stabilization programs I referred to. Discussions up till now have been positive, and all parties have been looking for a solution to problems faced by current programs. In the cause of these discussions, a federal-provincial technical committee was created to examine all aspects of the agricultural prices stabilization policy and report to respective ministers. While the present proposal is formulated by the federal government and comes under its responsibility, it was inspired to a large degree by these discussions.
Mr. Speaker, I believe the steps taken over the last six or seven years prove to what pains the federal government, and in particular the present Liberal government and the present Minister of Agriculture, have gone to give not only the agricultural population but all Canadians laws ensuring a greater stability of income for all farmers. This greater stability of income has an impact on all the other economic sectors; one must in fact recognize that if farmers must bear certain difficulties in the agricultural sector, an abnormal increase in food prices may follow. This would of course be due to a lack of planning, to a lack of price stabilization laws on Canadian agricultural products.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Bert Hargrave (Medicine Hat):: Mr. Speaker, while I was late getting in at the beginning of this debate, I am very pleased to have this opportunity to make a few remarks in support of my colleague, the hon. member for Wetaskiwin (Mr. Schellenberger). He has selected a very worth-while topic which has not received fair comment since the grain stabilization debate of several years ago.
There is much to be said in support of the individual stabilization approach. I think we should give it serious attention. In these few minutes, Mr. Speaker, I want to speak of the special needs it would serve in the drought areas across southern Alberta and southwestern Saskatchewan where there are the resultant extremes in farm and ranch income. This is materially affected by the rapid sales of livestock, grain and farm products due to the drought conditions which are a fact of life in that area.
I should like to give two excellent examples of this, Mr. Speaker, the years 1977 and 1978. The 1977 records show it was the worst single drought year since the 1930s. I speak with some conviction, Mr. Speaker, because I remember those years. The worst years were 1931, 1932 and 1937. The year 1977 was at least the equal in terms of growth, or lack of it, to those years in the thirties. Surface water, of course, is the staff of life in those drought areas, but snow run-off during that single year was worse than at any time in the ten-year period.
In sharp contrast, 1978 was one of the best growth years. I would go as far as to say it was the best growth year for natural grass or hay since 1927. The growth of cultivated grains was above average but not as spectacular in 1978 as was the growth of grass and hay.
Such extremes of moisture conditions present real problems to people involved in agriculture. I think we should give some special recognition to this problem when we discuss a stabilization program. The hon. member for Swift Current-Maple Creek (Mr. Hamilton) drew attention to the need for special recognition of these extremes in committee when we were considering the grain stabilization bill several years ago and he proposed the same concept-that it should be handled on an individual basis. I suggest that in the rush to stabilize various agricultural commodities this more practical and sensible approach has been completely overlooked. The hon. member for Wetaskiwin pointed out that the proposal has been fully researched by the planning and research secretariat of the Alberta department of agriculture. I do not wish to promote
February 26, 1979

this type of program for just that province, however, as I think there should be national individual stabilization.
In fairness, Mr. Speaker, I should say that most of my remarks will probably be directed to the possibility of such a program being used in the Canadian beef cattle industry but the same concept could apply to any other agricultural commodity. The basic concept of the individual approach would be that a farmer could deposit a portion of his income during high income years and withdraw some or all of those funds during low income years, in effect creating his own stabilization program. This has some basic advantages over what could be termed a universal stabilization plan, the concept that we have been considering officially until now.
Amongst the advantages, first of all, is the fact that it should cost less to the public treasury in terms of payout and the bureaucracy-needed to administer it. Second, the tax payments of farmers would probably not be greatly affected. They might increase as a result of a more stable environment, and tax revenues would tend to even out over the years which would be a good thing. The third advantage, and perhaps the most important, is that the plan would not obscure market signals in any way, whereas a universal plan tends to insulate farmers from the realities of the marketplace. That is most important, especially in the cattle industry. The feeling that goes along with that insulation from the marketplace is that if the market place does not pay enough, the taxpayer will. That feeling does exist as a result of the way some stabilization programs have been operated.
The fourth advantage that I see is that it would discourage farmers from attempting to delay taxes by maximizing costs in high income years. A big example of this is the practice of feeders and cattlemen of purchasing feeder cattle near the year end and carrying them over for resale in the next taxation year. This distorts the cattle market, and we are better off without such a practice. An individual stabilization program would get around this problem.
In summary, Mr. Speaker, the program suggested by the hon. member for Wetaskiwin has much to commend it over the current guaranteed margin approach that the federal government suggests in its new look at the stabilization program. What disturbs me about this program is the suggestion that there be a 100 per cent support level. That is what used to be called "top loading." A 100 per cent margin approach will guarantee a real top loaded situation. The danger of this is that it will definitely lead to overproduction. We would be ignorant of our immediate past history if we did not remember what led us into the situation we find ourselves in now where we have the highest prices in the history of the cattle industry because of the situation developed with an oversupply, influenced by government policies four or five years ago.
A stabilization program is fine, but we should not go overboard with it and then find ourselves in the situation that would require production controls. That would not be received very favourably by cattlemen. Those are my comments, Mr. Farm Income Stabilization
Speaker. I am very pleased to be here to support my colleague, the hon. member for Wetaskiwin.


Eymard G. Corbin: Mr. Speaker, I wonder if the hon. member would allow me to pose a question?


Herbert Thomas (Bert) Hargrave: Yes.


Eymard G. Corbin: Mr. Speaker, I wonder if the hon. member could tell the House whether his concept of stabilization could work outside the marketing agency or if, on the contrary, it would operate best within the framework of a marketing agency controlled by the producers.


Herbert Thomas (Bert) Hargrave: Mr. Speaker, I am sure the hon. member is addressing a question to me about the possibilities for supplying management powers. I would say that the cattle industry in Canada and, in fact, in North America, does not lend itself to that, and there are a couple of pretty important reasons. The first is that, whether we like it or not, we are operating in a North American market. When Canada is in a situation of having too many cattle, a situation Which does not occur very often, the only place where we can dispose of this excess of cattle is in the United States. When we have a shortage of cattle, a situation which we seem to be in most of the time, from where do we get additional cattle? From the United States.
The basis of my statement that we cannot operate on a supply management basis is that the United States, with their market-oriented approach in their cattle system, would never allow Canadian industry to be a part of that if we were to approach it in a supply management manner.


Mr. Cliff Mclsaac (Battleford-Kindersley):: Mr. Speaker, I am very happy to participate for a few moments in this particular debate. I am always happy to listen to both hon. members who have put forward their thoughts with respect to farm income and agriculture from the opposite side, namely, the hon. member for Wetaskiwin (Mr. Schellenberger) and the hon. member for Medicine Hat (Mr. Hargrave).
Let me say that I only disagreed with one comment made by the member from Medicine Hat when in essence, perhaps inadvertently he attributed some of the difficulties that the cattle industry in Canada and around the world has gone through over the last several years to government policies. I know my hon. friend is well aware that it would not matter if we had had no cattle in either Alberta or Saskatchewan over the last few years, we would still have seen more or less the same erratic fluctuations which have occurred in the United States, Australia, Brazil, and so on. We were not alone in some of the misjudgments, if you like, that were involved in terms of the very high numbers, which then decreased. We are now in a situation where the prices are up. I know his constituents and mine are more than happy with the prices being received today for beef and beef cattle. But consumers put pressure on provincial and federal governments, not only in Canada but elsewhere, to look at this whole question again to see what can

February 26, 1979
Farm Income Stabilization
or cannot be done. I share many of his views with respect to what can be done and what cannot be done, as well.
I would only quarrel with one aspect of the motion today, although I quarrel very little with the thoughts and thesis in general put forward by hon. members opposite. The motion reads:
That the Standing Committee on Agriculture be empowered to study the advisability of instituting an individual rather than aggregate program of income stabilization for the western producer-
My quarrel is with the "rather than" idea. I do not believe we can divorce the two concepts. I do not believe we can say there is no need for over-all farming stabilization plans, programs or policies, whether this pertains to potatoes, grain, beef, milk or anything else. Maybe we could look at some improvement and some changes in present policy, and perhaps present tax legislation to accommodate some of the things referred to, particularly as it pertains to the beef industry in western Canada. This was spelled out just a few moments ago by the hon. member for Medicine Hat. However, I would point out again my basic disagreement with the way the motion is worded, and say I would oppose it on that basis only. I am not opposing many of the excellent points put forward.
If I may take a moment or two to look at the general goals of stabilization plans, whether we are talking west or east it does not matter a great deal, we must look and ask ourselves what a general stabilization plan is designed to do. We should also ask ourselves whether we can devise an individual plan that will meet some of those objectives. I would suggest a stabilization plan for agriculture or for any agricultural product should first of all stabilize the income of the agricultural industry.
Second, it should help to stabilize the agricultural input in the industry. I am thinking here of the fertilizer industry, the chemical industry, veterinary supplies etc., all other machinery and related industries involved in agricultural input.
Third, I suppose an agricultural stabilization program should serve to stabilize the economy of the region. This, as my hon. friends opposite and indeed all members of this House know, has been one of the difficulties in western Canada, the instability of income for everybody in all economic sectors. We do not have to go back to the 1930s to those dramatic times with respect to lack of crops and lack of prices and the devastating effects which that cycle had. We have not seen anything similar to that since, but we still see the ups and downs, and the effects which they have on an entire region.
Then we must look at stability with respect to the income of an individual farmer as well; that I recognize and acknowledge. If we are talking only stability with respect to the individual, as opposed to paying no attention or very little attention to the over-all objectives of a stabilization program, we are not meeting all of the concerns with which we should be dealing.
I am sure that all hon. members in this House who are from farming areas particularly know of the high prices and high costs of input, the kinds of dollars and figures which farmers have to deal with today in writing cheques and in paying bills,

along with the kinds of receipts which they have to have, the income from any one of the farm products, that all of this is more and more important today than it ever was. Therefore we must look at every possibility of trying to bring about greater stability in the income of the individual farmer, producer, and farm producers collectively.
Cash flow today is absolutely vital to farmers in terms of continuing to operate. It does not matter whether they are maritime potato growers, or beef producers or grain growers. Long gone are the days when one could get by on a farm, as I did in the maritimes when I was growing up, with very little cash income. At that time one could also grow crops and bring them in and manage to get by with very few dollars. But that day has long since gone in all regions of the country and in all sectors of agriculture.
We need to look at our present aggregate plans. We need to stress those over and above the individual concept and the points made by my hon. friends in this particular motion. An aggregate plan will stabilize the income of the industry by making payouts when the income of that industry decreases. We have seen an example of that just in the past year with respect to the western grain stabilization program. I recall some of the questions and issues which came forward from that very good session of the committee at that time, referred to by the hon. member for Wetaskiwin.
The plan is now in operation. It is quite likely there will be a payout in that plan in the current year. He is correct in this sense that it does not meet all of the individual requirements that may come along. I am not sure that it should. I worry about a plan looking after the individual's cash needs in terms of having more interference with what that farmer may do or may not do. As the hon. member knows, in his part of Alberta, and in my part of Saskatchewan, the cereal grain farmer can grow wheat, or barley, or flax-he can grow a number of things in most cases. If we tied it up too much on an individual crop basis-


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


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
February 26, 1979


[Stage Direction]
The House resumed consideration of the motion of Mr. Ouellet that Bill C-29, to amend the National Housing Act and the Central Mortgage and Housing Corporation Act and to make other related amendments, be read the second time and referred to the Standing Committee on Health, Welfare and Social Affairs.
Mir. Art Lee (Vancouver East): Mr. Speaker, before the five o'clock adjournment I was addressing myself to the amendments with respect to the RRAP program. I indicated at that time that the RRAP program in effect had its origins in an area of my constituency known as Strathcona. I believe it is then appropriate for me to retell the Strathcona story in order that all hon. members can understand the significance of rehabilitation.
Strathcona is one of Vancouver's oldest residential neighbourhoods. Most of the houses in the area were built about the turn of the century, but some date back to the origins of the city itself. The Strathcona school was originally built in 1890 as the East End school.
The early residents of Strathcona were Anglo-Saxon. However, the area soon became inhabited by large numbers of Italians and Jews, as well as Scandinavians, Ukrainians, Russians and Yugoslavs. The old Hastings Auditorium at 828 East Hastings used to be called the "Italian Hall" and was the centre of Vancouver's pre-World War II Italian community. Benny's Italian Market at Union and Princess dates back to 1915. The Gibbs Boys Club building at Heatley and Pender was originally built in 1921 as the Schara Tzedeck Synagogue. The Ukrainian Canadian Centre at Hawks and Pender dates back to 1928. The church at Princess and Pender was built as the Swedish Lutheran Church and served as the Ukrainian Catholic Church before it became the Chinese Catholic Church. The Russian People's Home on Campbell Avenue, adjacent to the Russian Orthodox Church, was built by the Yugoslav community. The Yugoslavs had their own centre on Keefer Street.
Compared to the Europeans, the Chinese were latecomers to Strathcona. There were some Chinese and Japanese living in the area in the 1930s. However, it was not until after the repeal of the Chinese Exclusion Act in 1947 that Strathcona became increasingly Chinese. The area served as a gateway for postwar Chinese immigrants. Housing prices were low and the area was adjacent to Chinatown.
In 1947 Strathcona was only about 28 per cent Chinese. By 1957 this figure had reached about 50 per cent. Strathcona today is about 75 per cent Chinese. It contains less than 10 per cent of greater Vancouver's 60,000-plus Chinese. There are large numbers of Chinese living in neighbourhoods well outside of the Chinatown-Strathcona area.
Housing
In 1957 the city of Vancouver embarked upon a 20-year urban renewal plan. A major focus of this program was comprehensive redevelopment for Strathcona, the clearance of all existing homes and replacement with public housing, high rises, and row housing. Union Street was to be the southern border of the new Strathcona as the blocks of homes below it were to be demolished for a major city freeway system.
The rationale for the urban renewal was that Strathcona, in addition to having old and rundown housing, was in a strategic location being adjacent to the downtown, waterfront and False Creek areas. The city wanted high density development for Strathcona. Commencing in 1958, the city placed a freeze upon the entire area; property values were frozen; no major redevelopment and home improvement permits were allowed, and no regular public works maintenance was carried out. The neighbourhood was left to await the bulldozer.
The first phase of urban renewal began in 1959 with the construction of 159 units of public housing at MacLean Park. An entire block of homes was then demolished as a new replacement park. Ten acres of land and homes were then cleared in preparation for the 376 unit Raymur Place housing project at Campbell Avenue.
Acquisition and clearance for Scheme II urban renewal began in 1965 with the expropriation and clearance of homes in five blocks for an extention to MacLean Park, senior citizens housing, and an extention to Strathcona school.
The urban renewal schemes met strong opposition from Strathcona residents and Chinatown leaders. It was pointed out that the urban renewal would destroy the community and threaten the livelihood of Chinatown. The expropriation of homes for $6,000-$8,000 was argued to be unfair and discriminatory. The protests were of no avail as the city continued with its urban renewal. In August, 1968, the city prepared Scheme III, the final and complete bulldozing of the entire neighbourhood. Fortunately this scheme was never implemented as the federal government reassessed its urban renewal involvement across Canada.
The third and final urban renewal proposal had also sparked a last ditch effort among Strathcona residents to stop the bulldozing of their neighbourhood. In December, 1968, 600 persons attended the founding meeting of the Strathcona Property Owners and Tenants Association, SPOTA. The purpose of the new organization was to ensure that the people who live in the area would be fully informed, and their interests and community would be protected. In briefs to city hall, SPOTA argued for a revised renewal scheme which favoured rehabilitation and preservation.
In the fall of 1969 SPOTA was asked by the senior governments to join in a four level committee to investigate rehabilitation for Strathcona. It was the first time in Canada that a committee had been charged with that responsibility. It was also the first time that a citizens group had been invited to participate in such a capacity.
[Stage Direction]
February 26, 1979
Housing
In July, 1971, after almost two years of meetings, studies and negotiations, the committee agreed upon a series of recommendations. They called for a $4.9 million rehabilitation scheme, with two million dollars each in new public works and grant-loan housing rehabilitation assistance. The Strathcona rehabilitation project officially began in February, 1972, and operated out of a site office on Hawks Avenue. During the three years of implementation, the three levels of government, site office staff and the community worked closely and informally together.
In the summer of 1973 the federal government introduced national programs for neighbourhood improvement and rehabilitation based largely on the Strathcona experience. The new programs, NIP and RRAP, which the city of Vancouver has already chosen for certain areas, include additional and expanded features of the Strathcona project. The new programs are also meant to recognize a meaningful role for citizen involvement in the neighbourhood improvement process.
With the completion of the rehabilitation project in 1975, Strathcona displays a new look and spirit. Under the project 233 houses were improved, with the majority of home owners expending sums above and beyond the grant-loan assistance. If the original $2 million allotted for housing rehabilitation assistance, less than $700,000 was spent. This resulted because the grant-loan scheme excluded more home owners and failed to attract more landlords than had originally been estimated. The new sidewalks, sewers and streets were installed but overran their $2 million budget by $500,000.
With strong community initiative, a new linear park was funded by the rehabilitation project. Vacant lots were used in the park development to connect the existing parks in the neighbourhood. The linear park also involved blocking off streets and thus curtailing heavy truck and non-residential traffic through the community.
Another worth-while development during the rehabilitation project was the home improvement centre. Initiated by Strathcona students, this centre offered free design services and home improvement, and operated repair workshops for the elderly and lower income people. It operated under OFY and LIP funding.
For members of SPOTA, rehabilitation of their neighbourhood did not end with the rehabilitation project. Midway through the project in 1973, SPOTA initiated plans for nonprofit housing on infill lots throughout their neighbourhood. These lots, which had been acquired by the city under urban renewal, were sold to the provincial government at SPOTA's request. The province was to lease the land for non-profit housing.
SPOTA began its housing program with a seven-unit cooperative on five vacant lots at 730 Union Street. After several months of delay by city zoning officials, the project began construction in the fall of 1974. Five months later the seven families moved in. Financing of the co-operative came under the federal government's non-profit housing program.
In the fall of 1975 SPOTA began phase two of the infill housing. This involved three units of housing on double lots at eight different Strathcona locations. The first families started moving into the new units in the spring of 1976. Financing for this phase came under the provincial government's non-profit housing program.
The third and final phase of the infill housing involves the construction of single units on 16 remaining small lots. Construction was to begin in the summer of 1976.
Future SPOTA housing plans include non-profit housing on the vacant land opposite the Strathcona school. This site was acquired by the city under urban renewal and then sold to a developer for $210,000, about one third of the cost of the land assembly. In 1971 the city sought to buy it back for three times the amount to locate a large firehall there. After strong Strathcona-Chinatown protests, which culminated in a large rally in December, 1972, civic officials re-declared the land for housing. In February, 1974, SPOTA and another organization were chosen by the city to develop non-profit and senior citizens housing on the site. Although the two organizations submitted detailed housing plans to the city in the fall of 1974, no city action has been taken because of a legal suit filed by the private developer demanding market value for the land. At the present time the "firehall site" is a parking lot operated for and by the Vancouver police department.
During its years of existence, SPOTA has not only been involved in rehabilitation and new housing, but has also been concerned with many other community matters. The organization has worked closely with other Strathcona groups in social services and recreational and educational concerns. The orani-zation has participated in many festivals and conferences which have taken place in the area. It has assisted students and researchers interested in neighbourhood improvement and rehabilitation.
For SPOTA neighbourhood improvement will not end with the rehabilitation project and the new housing. It is a continuous process. Other problems will be encountered.
Whatever the future, there has been one central principle throughout the Strathcona experience, and that is that citizens must participate in those decisions which affect their community. This principle has been fought for by SPOTA, as it has been by many other neighbourhood organizations across Canada.
Also, Mr. Speaker, I have three other designated NIP/ RRAP areas in my riding, these being the downtown eastside, Grandview-Woodlands, and Kiwassa. I also share, with my hon. friend from Vancouver-Kingsway, the NIP/RRAP area known as Mount Pleasant. The same success story is applicable to these communities, People living in these areas have pride. They feel they belong to a neighbourhood. That is well worth the exercise.
I am told that since the program was introduced in 1973 CMHC has been assisting in the rehabilitation of some 20,000 units a year. I hope that as the program is broadened, and as municipal officials become more familiar with its application,
[Mr. Lee.1
February 26, 1979
[Stage Direction]
we will be able to increase that annual rate. It is important to bear in mind, however, that residential rehabilitation is a long-term program.
There are some two million housing units in Canada which were built before the end of the World War II. Some of these are in good shape, and some are now beyond rehabilitation. A great many of them-perhaps as many as half of these old houses-could benefit from some basic rehabilitation and have their useful life extended by a number of years. The point I would like to make is that a job of this magnitude cannot be accomplished overnight, or even in a single year. The number of homes that can be rehabilitated in any year depends not only upon the federal funds which can be made available but also upon the capacity of municipal organizations to manage and implement the program, and on availability of skilled, organized manpower to carry out the actual repairs and reconstruction. There is no question that residential rehabilitation will continue in Canada and will grow year by year.
There is no doubt in my mind either that the Government of Canada will continue to play a leadership role in this growing industry. The critical importance of rehabilitation is becoming more widely recognized every day in Canada and throughout the world.
More and more people are recognizing the importance of saving housing and extending its useful life, instead of tearing it down and building something new. Rehabilitation and preservation are part of the whole philosophy of the conserver society. There is a need to manage and recycle our non-renewable resources.
If we can make our existing housing work longer, there is a very significant saving in energy, materials, and financial resources, compared with starting from scratch to build new houses. This trend is an important part of the changing pattern of housing development which is emerging in Canada and throughout the world. It means that our concerns are gradually shifting away from annual production targets to a broader concept of housing needs.
Since the end of World War II and up until recent years our main concern has been with production, the generation of new housing starts. CMHC was established in 1946 to help us catch up with the backlog of housing production created by the depression and the war years. We were worried, first of all, about housing for returning veterans, and then about the growing demand created by the so-called baby boom. The production of new housing was a critical problem in those years and has continued to be important. Many of our National Housing Act programs have been intended to encourage new construction. Up to now, that has been our prime goal.
Times are changing, however, and so are our housing needs. The rate of population growth has been slowing down for the last 20 years or so and this likely will continue for at least another decade. This fact and others mean that we will need less new housing each year. By the mid-eighties, as we have all read, we will probably need only about 200,000 starts a year.
Housing
Declining population growth also means that there will be a higher proportion of elderly people in the population. At the same time, more people are putting off getting married and having children. Young people are leaving home at an earlier age. The result of these trends will be smaller households and more so-called non-family households. The net effect of all these changes will be a shift from the suburbs, away from the ranch bungalows and family-type, child-oriented housing, toward the inner city where housing is older and more in need of rehabilitation.
The rising cost of fuel and our dwindling energy resources will, of course, accelerate this shift into the city proper by raising the cost of the daily journey to work.
All the demographic trends, economic projections and our shifting social values suggest that rehabilitation is going to be a more significant activity for at least the rest of this century. I am pleased to see the government, in bringing forward these amendments, recognizes the importance of rehabilitation and conservation and has reaffirmed its intention to continue to support it in a tangible way.
One particular amendment relating to rehabilitation deserves special mention, namely, the lifting of the $500 forgiveness feature on private rooming houses. The rate will be established by regulation and therefore this method provides the required flexibility. At present, the law provides for loans up to $4,000 per bed to rehabilitate rooming houses with $500 of this amount being forgivable. The Minister of State for Urban Affairs (Mr. Ouellet) recognized this as being totally inadequate, and these amendments take care of this by removing the maximum ceiling of $500.
What does this mean, however, in human terms? Really, it finally recognizes that people who live in the downtown cores of cities, often wrongly referred to as skid rows, are entitled to decent housing, as well as those who live in more affluent areas.
Some hon. Members:: Hear, hear!


Arthur John (Art) Lee: The seed for this amendment was planted during the Habitat conference which took place in Vancouver in the spring of 1976 when the Minister of National Defence (Mr. Danson) visited the downtown east side of Vancouver in his former capacity as minister of state for urban affairs. He saw the deplorable conditions first-hand. The same is true in other Canadian cities, like Toronto. Unfortunately, the conditions in Vancouver's downtown east side are indescribable with words, but let me illustrate by quoting from a report entitled "The Downtown East Side Report" as follows:
In general, though, the relevant area is bounded by Clark Drive, Cambie Street, the south lane of Hastings Street, and the waterfront. It also includes a number of hotels and rooming houses in Chinatown and Strathcona. A number of people live in a similar housing situation in the downtown core, particularly on Granville Street, but because of resource limitations they were not specifically included in the study.
Over the past few decades, accommodation in hotels and rooming houses has been allowed to decline in both quantity and quality. Commercial uses and office space uses have pushed many residents eastward, first out of the downtown core, and, later, out of the Gastown area. Residents have opposed this trend, but

February 26, 1979
Housing
municipal zoning policies have allowed it to continue. More recently, re-zoning proposals threaten to allow industrial uses to displace residential accommodation in the Oppenheimer area, east of Main Street. New zoning policies to stabilize and reinforce the residential character of the area would be needed to halt this over-all trend.
The hotels involved are very old buildings, some of them built before the turn of the century. The above-ground floors are divided into single rooms. Usually, the ground floor contains commercial space, often premises with a liquor licence legally supported by the rooms upstairs. The rooming houses are smaller buildings or large older houses divided into separate rooms for tenants.
For years the hotels and rooming houses of the downtown eastside have been characterized by an almost continuous stream of complaints about uncleanliness, pests, fire hazards, etc. These conditions usually violate Vancouver bylaw standards. The problem has been not that the standards are too lenient, but that the standards have not been met, in practice.
In fact the report disclosed that the total number of bylaw violations found in the 23 buildings examined was 9,743.
What about the people who live in these rooming houses? Who are they? Putting the sex, age and household status of the tenants together, the most typical tenant interviewed was a 50 to 59-year old man living by himself.
Because the area involved is wrongfully referred to as skid row, there is a myth that tenants who live there are transient. In fact the average length of residence is about 13 years, an astonishing figure for a neighbourhood that has a reputation as a transient area. This result is confirmed by the 1971 census, which showed that the downtown east side is the second most stable residential area of Vancouver, after Dunbar, a comfortable single family dwelling area.
With respect to income, it is striking that almost all the people surveyed receive well below the minimum income estimated by the Canadian Senate as necessary for a decent, healthy life in Canada; 34 per cent receive less than half the poverty level. In short, most of the tenants are on fixed incomes, receiving guaranteed income supplements, war veterans allowances, Canada Pension and unemployment insurance. With this particular amendment, rehabilitation of these rooming houses can now go ahead. Rehabilitation will unquestionably help this area, but new housing is also required. The federal government, through CMHC, considers new housing a priority in this area. What does the city of Vancouver say? His Worship Jack Volrich says it is not a priority area.
What does the province say? Well, it is up to the city to declare its priority and, in any event, the province will not make direct subsidies available to new housing projects, other than senior citizens' projects. Clearly, given the level of incomes in this area, subsidies are required to augment and to ensure the amendments in this current bill regarding social housing will be effective. However, the city and the province through the minister of housing, the hon. William Vander Zalm, who is well known to hon. members of this House for his "Frog" songs-


Benno Friesen: He is a Liberal. He ran for the Liberal leadership.


Arthur John (Art) Lee: -are reluctant to reciprocate the federal measures. I submit this is because of ignorance on the part of the present minister of housing in British Columbia and the mayor
[Mr. Lee.)
and city council of Vancouver. To classify this area as skid-row is totally unacceptable. Residents, like other Canadian citizens, deserve decent, affordable housing. The federal minister of housing has recognized this by these amendments, and I would encourage the city of Vancouver and the province of British Columbia to join with the federal government in helping areas like the downtown east side core of the city of Vancouver.
We are dealing with human beings, not some mythical notion of skid-row bums or winos. To allow areas like the downtown east side to stagnate because of ignorance would be a travesty and a condemnation of modern civilization.


Mr. Blackburn:: Mr. Speaker, I rise on a point of order which is directed to the hon. member for Vancouver East (Mr. Lee), having listened to his very lengthy but very informative speech. I should like to ask the hon. member, for whom I have the utmost respect, what he has been able to do in this area since becoming a member of parliament. I find myself in a similar position in my riding. What can we do as members of parliament here in Ottawa to get rid of the slum landlords, to try to get rid of the people who would take-


The Acting Speaker (Mr. Turner):: I suggest to the hon. member that this is not a point of order. He is asking the hon. member for Vancouver East (Mr. Lee) a question. Would the hon. member for Vancouver East accept a question?


Arthur John (Art) Lee: Yes, Mr. Speaker. In answer to the question the hon. member put to me about what we can do with absentee and slum landlords, let me say to him that the first thing we can do in the city of Vancouver-and some members of the council in that city have been trying to do it-is to get the city standards and bylaws enforced. If you start enforcing these bylaws, it is argued these people will close the hotels and the private rooming houses. But our experience has shown that this is not necessarily the case.
The more recent experience we have had in the area of enforcing the bylaw with respect to the installation of fire sprinklers cost a lot of money, and most of the absentee landlords said they would have to close these premises down because of the cost. But the enforcement of these bylaws has saved a number of lives and has not resulted in most of these absentee landlords closing down the premises. A lot has to be done by the maintenance of city standards and bylaws, but the kinds of amendments envisaged in this legislation will help as well.


Dean Waldon Whiteway: Mr. Speaker, it is Monday, February 26, 1979, and I want you to know, sir, that in the House of Commons, in the nation's capital, things are as they ought to be. We on this side propose and they on the other side oppose. We have taken the stance of the government in proposing the positive proposals on the deductibility of interest on property taxes. They on the other side are preparing
February 26, 1979

themselves for the opposition and are taking the stance of opposing that.


Some hon. Members:: Oh, oh!


Dean Waldon Whiteway: Just listen to those Liberals howl. The minister leading off the debate and his Liberals have spent more time criticizing and attacking the Conservative proposal and policy, which is a clear, popular policy across the country, of interest deductibility of municipal property taxes. The minister spoke in the House for two and a half hours but did not say anything. He is a minister who speaks well in both languages but says nothing in either. For two and a half hours he spoke in this chamber and, by and large, he said nothing except to criticize the PC policy of interest deductibility of municipal property taxes.
You will understand, sir, my reluctance to believe them because I well remember the time back in the election campaign of 1974 when this government and this minister went across the country preaching to the Canadian people, and sounding so sincere, that price and wage controls would not work. I remember well the night when the Prime Minister of this country (Mr. Trudeau) spoke on national television and, in a most dramatic moment, pointed straight to every Canadian and said, "Zap, you're frozen." The Liberals were against wage and price controls, and every Canadian knew they were against it. To a man they were categorically opposed to them. Well, sir, here they sit tonight, as they did yesterday and last week, and as I suppose they will tomorrow, opposed to our program of interest deductibility and municipal tax deductibility from personal income tax. So you will undertstand if I am reluctant to believe them, for these Liberals will change their minds as the wind changes and they will Find out, as they have in the byelections and since, what the people truly think.
They sent a contingent down to Washington to prepare a report and to come back and tell us that everyone in Washington is against our program. If they could, they would undo it. Why, everyone is against it except the people, except the 230 million Americans. Well, sir, my party and I, we will all stay with the people.
I was somewhat impressed by the housing critic of my party, the hon. member for Ottawa-Carleton (Mrs. Pigott), as she spoke in the House for about an hour. She did not use the kind of biting criticism that was a characteristic of the minister's speech. She was constructive. To that degree I can also compliment the hon. member for Vancouver East (Mr. Lee) because, although his opening remarks in the First Five or ten minutes were critical of our deductibility program, he did at least devote part of his speech to his own riding and the things that are happening there. These Liberals are so preoccupied
and all in a fluff because they are on the wrong side, not only of a good issue but of the right issue. I am going to set them straight and do what, from time to time, is required of students of government who have not done their homework. I will lecture them, sir, from Five to ten minutes on the merits of the interest deductibility proposal.
Housing
First of all, the minister should know that our program is not a housing program. He referred to it time and time again as the Tory housing policy. It is not a housing policy. We have told him and told him, but we will tell him again that this is not our housing policy. Now that the super minister of economic affairs is here, perhaps he might write it down and tape the note in front of his desk so that in time he will understand that this is not our housing policy, it is an economic policy.
Our economic policy on the deductibility of interest on your principal residence up to a maximum of $5,000 a year is based on the principle that governments prejudice interest rates. I am fortunate in that the President of the Board of Economic Development Ministers (Mr. Andras) is in the House paying strict attention, and I am sure that when he speaks on this subject he will underscore the reality that governments, by their borrowing practices and spending habits, in essence set the interest rates of the country. It is because of the wasteful and extravagant spending of the government that the interest rates on first mortgages in this country are anywhere between 11.75 per cent to 12.5 per cent, depending in what part of the country you apply for a mortgage. So the First principle of our program is based on the reality that government sets interest rates.
Then the other reality is that in the 25 or 30-year amortization period of a mortgage, interest constitutes a large portion of the principal and interest mortgage payment.
Another principle upon which our policy is based is that housing is the right of every Canadian. We disagree with what was suggested by the Minister of Industry, Trade and Commerce (Mr. Horner) when he said that housing was a luxury. I do not consider housing to be a luxury. It is the right of every Canadian who wants to own his own home. The government ought to put its Financial affairs into shape so that those Canadians can afford homes. It is with that background that we adopted a policy of interest deductibility. Our policy is a simple one. Its maximum is $5,000 a year on a maximum mortgage of $50,000 on the interest deductibility side. It must be on a principal residence, a First mortgage, and $1,000 maximum property taxes.
We heard the minister and other government members scrambling to think of every conceivable bad point in our policy. They even put the best minds at the Central Mortgage and Housing Corporation to work. I know my information is true because I was told by members of CMHC. The minister told them to burn the midnight oil. They were told to get their best minds and brains working on getting reasons why the Tory policy is bad and will not work. The minister did not ask for an objective analysis of the deductibility. He wanted reasons to Fire back at Tory members why the program would not work. They came up with the following reasons.
They said our program was for the rich. The facts prove them wrong. There are approximately 4.6 million households in the country. Approximately 67 per cent, or two-thirds, of home owners earn under $15,000, and only 6 per cent earn

February 26, 1979
Housing
over $25,000. The argument that our program is for the rich just does not bear out. As a matter of fact, if one combines all the incomes of people working in a given family, 35 per cent of family incomes are under $10,000. Only 10 per cent of the combined incomes within families owning homes are over $25,000. When the Grits go around the country indicating that it is not a policy for the poor, they do not have the facts, and the facts prove them wrong.
Another great criticism which is mimicked in unison from time to time by hon. members opposite is that there will be a great run on the mortgage market. Canadian mortgage funds will dry up, according to hon. members opposite, if everyone runs out and borrows all the money they can against their homes to take full advantage of the mortgage deductibility scheme. Perhaps that will occur, but we must remember that most Canadians have mortgages on their homes, or those who do not have the maximum possible mortgages on their homes, run out to borrow money in order to take advantage of the scheme, will they put it in cookie jars or their socks? Of course not. They will re-invest it.
The other day my leader coined a phrase, a little slogan which means a lot, "From the sock to the stock." I happen to think Canadians are astute in investing their money in Canada. Thus I am excited about the possibility of Canadians borrowing against their homes to invest in this country. If they do that, our program will be of double benefit to the country.
Also hon. members opposite indicate that our program would discriminate against renters. The minister made a great ado about this. He indicated that our policy would discriminate against renters. I took the time to visit one apartment block in my constituency. I knocked on several doors and said, "Do you have a dream or a hope of one day owning your own home?" In every single case the answer was "Yes". I do not deny from time to time some Canadians prefer to rent, but by and large renters want to own their own homes. Our program would allow their hopes to happen and their dreams to come true. It would allow a large number of renters to own their own homes. The Liberals who suggest this program discriminates against renters should talk to the renters and find out that that is not the case.
Also hon. members opposite have indicated that the government could not afford such a program. They have asked how Tories would be able to pay for the program, and have come up with astronomical figures. We indicated that the cost of the program would be $1.6 billion in the fourth year, and the Liberal government increased that cost by $4 billion. That is the type of Grit financing which has occurred over the last 15 years. We have said that it would cost approximately $1.6 billion, and our estimation will not be out by much. We can afford such a scheme because we believe the Auditor General when he said there was waste and inefficiency in the government. Now we have a political commitment.
When my leader goes across the country talking about zero-based financing, sunset laws, the efficiency of government, and squeezing every tax dollar for every bit of worth we can get out of it, he means it. We are committed to such a
government program, and that is why our interest deductibility scheme will work. Also we know it will work because we have the support of Canadians across the country.
We on this side know the comments that we have been receiving, as well as the comments being received by government members. This is an exciting program which gets the blood of Canadians running. They see tax dollars coming to them which otherwise would go to the government. An increase in their disposable incomes makes them excited because it increases their buying power. That would be an economic stimulus. I suspect there are still Liberals in the country who will attempt to discredit our program every time they get a chance, but they should remember that Canadians are accepting our program and rejecting their criticism. They are lining up by the hundreds of thousands to support a government which proposes such programs.
We are beginning to prepare for governing, while the Liberal government is beginning to prepare itself for the role of opposition. The Liberal government is stale and a spendthrift. It is almost foreshadowing the things to come when the Prime Minister calls the next election.
Other members on this side of the House will deal with various aspects of Bill C-29 which should have been before the House for consideration a year ago. The Minister of State for Urban Affairs (Mr. Ouellet) should not stand in his place and suggest that we ought to give this bill quick passage, and then speak on it for 2.5 hours one year after it should have been introduced. We on this side will take the bill apart piece by piece. In committee we will reconstruct it so that it will deal effectively with the problems in the country. The hon. member for St. John's East (Mr. McGrath) will deal with AHOP. The hon. member for Parry Sound-Muskoka (Mr. Darling) will deal with rural housing and CHIP. The hon. member for Rosedale (Mr. Crombie) will deal with RRAP and community services. The hon. member for Lambton-Kent (Mr. Holmes) will deal with native housing, and so on. We on this side will propose such positive amendments and criticisms of this legislation that it will be whipped into shape. In committee we will continue the mentality which the government has displayed in preparing itself for the role of opposition.
I am concerned that Bill C-29 merely begins new directions in housing, a new era in consultation and relations between the federal and provincial governments, a new direction in housing, from public to social and a new era in financing, that is, a shift from the government sector to the private sector. I would like to deal with those three areas.
The era of consultation, of realizations between the federal government and the provincial governments is the first one with which I would like to deal. We have had a decade of intrusion by the federal government into provincial jurisdiction, and as a death repentance, at the last hour on the eve of a federal election the Minister of State for Urban Affairs is scrambling about the country finally realizing that the ministry of state for urban affairs must wind down and get out of

February 26, 1979

areas of jurisdiction belonging to the provinces, so he talks about global funding.
Consultation means to seek opinion and implies obtaining agreement before action is taken. The most recent report of the task force of western premiers on constitutional trends reads at page 31:
In the broad areas of housing and urban affairs, consultation is virtually non existent.
The western premiers have found that through the years consultation has not been there, so when the minister claimed there had been consultation he implied that not only had he sought their advice, that there was discussion on the various courses of action, but that there had been agreement before action was taken. We now have as of January 1, in effect, a new housing act for community services, and yet as of that date there were provinces which had not signed and were not in agreement, but parliament is asked to ratify the amendments.
Parliament, in the tradition which I know it, is a body which debates the proposals of the federal government before they are implemented, but in this case we are asked merely to ratify the decision already made and implemented by the federal government. I can see, in looking at the documentation which I can Find, and hearing the testimony of the provinces, that this was a hurried move by the minister. There were two meetings, one of which was on February 1, 1978, in Edmonton. After those two meetings, and without agreement, the minister decides unilaterally on a new direction for housing, the new community service program, and he is chopping AHOP, changing RRAP, and abolishing ARP and all the rest, on a unilateral decision by this government. That certainly is not consultation. That is a new direction in housing, but it is a typical kind of consultation which characterizes this government.
What we now see is more central housing policies in the name of unity and that the provincial governments are now asked not to be co-makers of policy or co-determiners of a direction for housing, but to be nothing more than administrators, the boys who do the leg work for the kinds of programs envisaged by the minister. For those who believe that this federal government consults with the provinces about global funding, I would read to hon. members what the minister said in his speech as it is reported at page 3551 of Hansard:
This bill will enable us not only to reach our goals in the housing field but also to obtain an even wider objective. It will enable the government to co-operate with other government levels so that Canadians may live in a safe and pleasant environment.
He goes on to say a few lines down:
The community services program was discussed with the provincial ministers concerned.
Perhaps it was discussed, but there was no agreement reached and nothing signed before it was implemented. He then goes on to say:
The federal government will continue, of course, to provide help in the form of direct grants for all those activities but it will extend from now on its assistance to a whole list of social, cultural and recreational services.
Housing
This minister is not only continuing the tradition of this government of intrusion into provincial rights respecting housing, but in fact he is enlarging his share of influence. By the minister's own definition this program now covers a whole list of social, cultural, and recreational services. I can see that this new era of consultation is really a new era of intrusion by this federal minister, under the hoax of community services and the illusion of global funding. I like his language because it sounds good, but he betrays himself as to what he really means. I am concerned that this new era of consultation is really much more widespread in terms of intrusion, but as far as the mentality of the minister is concerned, it is only business as usual.
This bill poses a new era in the direction of housing from the public sector to the social sector. I have been watching the clock and it must be on "speed up" time because it is just flying by, so I am going to make one point and then go on to a solution I have for the minister which I would like to put to him before my time expires. We see in this shift from public to social housing-and by that I mean a new concept in the thinking of this minister and this government-that the responsibility of the federal government is not simply providing the unity which is a classic definition of public housing, but rather going into social housing which implies not only the brick and mortar but also the kind of community, equality, and integrated housing. It is much more socialistic than the minister would lead us to believe. I think there ought to be some scrutiny in this regard, the change from the traditional public funding by the federal government to a socialistic housing policy.
The area which is of most interest to me tonight is the change to a new era of financing proposed by Bill C-29, a shift from the funding which was hitherto the responsibility of the federal government. That responsibility for funding is now being shifted to the private sector. In effect, the private sector will take on the socialistic policies of the federal government. This is evident in two particular areas. One area is with regard to RRAP, which my colleague, the hon. member for Rosedale, will deal with, but I hope that the minister, being from the province of Quebec, realizes that with the large number of renters in that province it will be of particular concern to Quebeckers. No longer will the federal government provide funds for the RRAP program. They must now come exclusively from the private sector, which will bring hardship to the province of Quebec in particular because funding from the private sector will not come easy.
In the last year we have witnessed a fiasco in the AHOP program. My colleague, the hon. member for St. John's East, will be talking about AHOP, but certainly I want to deal with GPMs. GPMs are replacing the AHOP program, so we must look at AHOP to see what went wrong with it in order to determine whether GPMs can correct it.
AHOP was based on two premises, shaky as they were. I am surprised that the superminister, who at one time was minister

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of urban affairs, even allowed AHOP to come into being. I applaud the government for innovative ideas, for new concepts, but it is foolhardy, it is stupid, it is irresponsible for a government to jump from one program into another without evaluating the First one. They are jumping from AHOP into GPMs without evaluating AHOP.
The two premises on which AHOP rested were, first, that the real disposal income of AHOP families would increase. The other day the minister said-and I cannot quote him exactly-"I am sorry that their incomes did not rise to their expectations; I am sorry that their real incomes did not go up as much as they had thought or hoped." He is sorry to bring in a program based on the fact that incomes would rise-then the government brought in wage and price controls which would negate that fact-but he introduces it after 10 per cent of AHOP units in this country are in default. That figure will double within four or five months.
AHOP was based on the assumption that the real value of the property would increase. We knew what happened to land and house prices at the turn of the decade, yet this government based a program on the expectation, upon the certainty, that real estate values would increase. In the last couple of years, sir, real estate has not appreciated. Now that the first five-year term is over we find that the value of AHOP homes has not escalated. Because of the subsidy against the second mortgage-held by CMHC or the lender-those two combined exceeded the value of the home. With the market interest rates of today and the real PIT doubled in many cases, we are faced with walk-aways and defaults.
In that setting the government turned its back on AHOP, still defending it in this House and across the country. If they could humble themselves for once and bring themselves to admit-the Minister of State (Fitness and Amateur Sport) (Mrs. Campagnolo) is in the House tonight and this could easily be said of her-that they make a mistake in judgment, as we all do from time to time; if only they could come before the House and the Canadian people and say, "We made a mistake in judgment, we acted without the full facts," instead, they defend their actions today-and it will be to the death of this government.
Instead of admitting that AHOP is a colossal failure with massive defaults, the Minister of State for Urban Affairs stands in this House and defends it. But it is so good that he abandons the program and brings in GPM! That alone is evidence that the AHOP funding was inadequate, badly based, and irresponsible.
Let us examine the GPMs and see what the lending institutions say about this new government funding scheme. I shall only take time for two quotations. An article in the Free Press of February 21 reports an interview with Mr. M. L. Lahn of Canada Trust in which he said that most foreclosures of Canada Trust are related to the disastrous AHOP. The article goes on as follows:

Canada Trust became a lender under the AHOP program "most reluctantly and only in support of government policy." The loans were government insured, otherwise the company would not have participated, the president said.
The current Central Mortgage and Housing Corp. (CMHC) sponsored graduated payments loans almost ensure negative equities and even greater foreclosure problems unless inflation in housing values occurs rapidly-a rather inappropriate social premise on which to proceed.
He goes on to say that he will not participate. Perhaps the minister wants to pass off lightly what the trust companies say, but he cannot pass off the Royal Bank. Mr. W. Peter Carter, the general manager of mortgage services for the Royal Bank-he is no little teller, he is the man who is going to make the policy-was interviewed by The Tribune. An article which appeared in the February 17 issue reports in part as follows:
He said the GPM lending scheme is an example of both "irresponsible lending" and "irresponsible government."
The article went on to quote him as follows:
The major chartered banks have told Central Mortgage and Housing Corp. of our concerns and have told them bluntly that we are not prepared to promote such a scheme," he said. "We think it is morally indefensible."
The Royal Bank will not lend a nickel to the GPM. Last Friday, with the knowledge of the disaster of AHOP, with the knowledge that the lending institutions have told him the policy is wrong, indefensible, immoral and irresponsible, the minister said in this House, "Boys, we are going to go ahead anyway."
Sir, GPM could work. Here is a formula. The minister is in the House and he should take his pencil and write it down. The super minister is also here. He should write it down in case the Minister of State for Urban Affairs cannot understand it. Here is the formula by which GPMs could work.
Let us look at the government's proposal. It is for 5 per cent down and that the level of payments in the first five years be 75 per cent of the normal level of payments. That means that for the first nine years, in fact for the first 15 years, the debt against the house will exceed the original principal owing on the house. That will guarantee for the first 15 years that whoever owns it will owe more than they paid for the house. It will be negative equity. That is why the Royal Bank and Canada Trust have said they will not participate, because of that kind of irresponsible lending practice.
They have suggested that if the minister would use the formula of 14 per cent down, 14 per cent front end equity and 75 per cent of standard level payment, it would work. That would always ensure that the debt would never exceed the original principal, or cost of the house. Alternatively, they could put 8 per cent down and have the payments 85 per cent of the normal level payments. Either of those would work as long as at any given time there would be no negative equity. That is the key to making the GPM work. Any other formula will not work.
The minister knew this scheme was bound for disaster. The banks and financial institutions of the country as well as the CMHC warned him. He knew this would not be an exciting program to the banks because of the track record of AHOP. The GPM is identical to AHOP in the concept of 5 per cent and 75 per cent.
February 26, 1979

The minister must have thought that he could throw in a sweetener-give them a deal they could not refuse. In effect he told the private banking institutions, "The government is not going to have any more responsibility for funding for families whose incomes cannot buy a normal market mortgage." He was saying that the government is going to wipe its hands of funding responsibility and put it all in the private sector. He was saying, "Boys, here is a deal you cannot refuse. If you accept this kind of funding which has already proved to be disastrous in AHOP"-that is my editorial note-the minister did not admit that, never has, and probably never will. The sweetener is-and this is all in the bill-that if the GPMs are in default for 90 days, all the lender-the trust company or the bank-has to do is to phone CMHC and tell them, and CMHC says, "All right, we will make good the mortgage." It is done immediately, without any foreclosure procedure, without any normal period in which they can give notice of foreclosure to the tenant, or to the mortgagee. There is none of that. CMHC will pay up immediately. That was the sweetener, and knowing it was a bad economic policy the government said, "Do not worry, this will not cost you a cent. If they are three months in arrears, we will guarantee the payment."
Sir, I am glad that the banks and the trust companies in this country are more responsible than the minister. They said, "That kind of financing is morally indefensible. We will not do it. We will not go along with it." Here is the answer, sir. I will make those changes in committee. I will make the amendments that will change the GPMs so that they will be acceptable to the lending institutions of this country. I will give the minister notice now that if he does not accept those and the other amendments which we have proposed on this side to clean up Bill C-29 and make it look like a housing policy instead of political gimmickry, we will not support this bill on third reading. We will vote for it to go to committee so we can clean it up. That is the stance we are taking. It is a positive stance, getting ready for government.
We have positive proposals. We will take them to the committee and we will move every amendment necessary to make this act work and to make it equitable. We will make it do all the things the minister claims he wants done but claims he cannot because the legislation is inadequate. We will do that. But if you do not accept those, sir, we will vote against this bill on third reading. We will do so because the legislation is wrong and the GPM is morally indefensible. It will lead to the same kinds of disasters we have experienced with AHOP.
There are two other alternatives about which we have been talking. These are positive suggestions that we have asked the minister to consider in the area of housing. We have asked him to look at reverse annuities for senior citizens or for those people who have equity in their homes but may want to turn that equity into an annuity. We have asked the minister to look at that. Up to this point in time there have been no studies and no reviews. We have not had a minute's worth of study done by this minister's department on reverse annuities.
Housing
We have asked the minister to look at variable rates. But as soon as we say that variable rates are popular in some states of the United States, the minister has this phobia that interest deductibility is an American phenomenon. It is an American dream but it has been part of the American housing policy for some 50 years. So the minister has this phobia that an Americanized dream is something wrong. It is something like saying that we cannot copy those Americans. The minister has not even considered this suggestion. As a matter of fact, the words variable mortgage have never passed his lips. He cannot bring himself to say the words. We are saying the words tonight. I am asking the minister to look at variable rates in mortgages which have worked successfully in many of the states in the United States.
I see that my time has almost expired, but before closing I would like to tell the minister that we have been watching his activities over the last year. We have been waiting for this legislation. I want to tell you, sir, that I am disappointed that this minister continues hacking at the branches instead of digging at the roots. He hacks at the branches, changing the rules. He has a program one day which he changes the next. He has an AHOP policy one day and he abolishes it the next. This government, and this minister, will be known as the government of default by default. I would hope that when we take the reins of government the comparison will be made that they were the government of default and we were the government of no fault.
To that end we would commit ourselves and our party not only to good economic policy but to a housing policy of equity for all.


Some hon. Members:: Hear, hear!


Miss Aideen Nicholson (Parliamentary Secretary to Minister of Consumer and Corporate Affairs):: Mr. Speaker, I welcome the National Housing Act amendments which provide some needed additional flexibility. I am particularly pleased that the restrictions were removed from the Residential Rehabilitation Assistance Program so that it is no longer limited to housing in areas designated for neighbourhood improvement. When this bill is passed, the Residential Rehabilitation Assistance Program, or RRAP, as most people know it, will make available to individual home owners CMHC direct loans and subsidies based on income. Co-operative housing groups and non-profit associations will also be eligible for RRAP assistance without being limited to designated areas.
Representing as I do an urban constituency with older housing and with many skilled construction workers who could do repairs and reconstruction, I am particularly pleased to see measures that favour renovation and preservation of older housing.
Many of our Canadian housing programs up to now have been aimed at increasing the supply of new houses. For example, ceilings on the AHOP program were such that, in Toronto, buyers were limited to a condominium or a townhouse in the suburbs. But many people prefer to live near their

February 26, 1979
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families and friends in the inner city without having to spend a lot of time and money travelling to and from work, hence the importance of renovating older homes and doing this in a way which makes these homes accessible to people with low incomes, whether these older homes are renovated by individual home owners or by a group of people who have decided to form a co-operative in order to provide themselves with affordable housing.
Prior to 1973 co-operative housing was treated as just another form of home ownership and received the same treatment and benefits as a single applicant for a home owner loan. I am referring here to both types of housing co-operatives, first the building co-operatives in which a group of people simply pool their resources to build their housing at the same time with each member of the group owning a unit outright, to do with as she or he pleases, and second, the continuing co-operative or the non-profit group which provide housing for members, in which case the co-operative itself owns the housing, each member has a share in the project, and none of the units in such a co-operative can be sold for a profit.
By 1973, although building co-operatives received some assistance, continuing co-operatives under group ownership had great difficulty in getting recognition and acceptance under the act. One problem was that legislation did not provide for co-operatives to obtain loans for low rental housing, except as the sponsor for a project in which residents did not have to be members. In other words, people with low and moderate income could have housing provided for them, but they could not own it through a co-operative.
Another problem prior to 1973 was that co-operatives could obtain funding only for new projects, not for existing housing, nor even for the rehabilitation of existing housing. As a result, people in a rental project could not get an NHA loan to buy it co-operatively even if the landlord wished to sell it to them. This made it difficult indeed to mount a strong national progam of co-operative housing.
Nineteen seventy-three, however, saw the beginning of some of the changes, the final development of which we see in the present bill. This was aimed at helping co-operatives to develop fully as another housing alternative, and particularly for Canadians with low and moderate incomes. The two most important provisions in the 1973 legislation were, first, that housing co-operatives could qualify for 100 per cent loans for non-profit, low rental housing; and, second, loans were made available for both the purchase and rehabilitation of existing housing. That new legislation in effect started a new form of co-operatives, one in which members are collectively owners but individually are in a leasehold position. On the one hand, they have the proprietary rights of a landlord and, on the other hand, the rights and advantages of tenants.
Recently the Minister of State for Urban Affairs (Mr. Ouellet) had extensive discussions with the Co-Operative Housing Foundation of Canada which resulted in an agreement concerning the administration of subsidies and charges to occupants of the housing units that serve mutual objectives.
The new agreement provides for fewer controls by CMHC on actual project development, and allows co-operatives to have the opportunity to use a wider range of procurement techniques based on the group's experience. Greater latitude is also given to co-operative groups in choosing between the acquisition of existing developments and the construction of new projects. The agreement provides, as well, for a significant increase in the federal financial support to co-operative projects, and continued application of the Residential Rehabilitation Assistance Program. This agreement reflects the greater experience that has been gained in co-operative housing.
One important feature of the new legislation is that co-operative housing will be available to anyone, on a rent to income basis. Those who can afford to pay the full rent will do so. Those whose income is not sufficient to allow them to afford the full rent will pay according to their income, and the resulting losses will be offset by federal government subsidies.
There is no doubt that the new program will result in much higher production of this much needed type of accommodation; federal assistance will be almost doubled, and I understand that private lending institutions have indicated their willingness to invest as much as $500 million during the next few years in support of co-operative housing. This means that the number of people living in co-operative housing could easily double in a few years, going from the present level of about 50,000 to more than 100,000.
I am pleased to see this enhanced support to co-operative housing. It represents another means of offering an improved choice to families who want to own a home and are willing to put work into it but do not have large amounts of capital available.


James Aloysius McGrath: Mr. Speaker, I am glad to see that the Minister of Public Works and Minister of State for Urban Affairs (Mr. Ouellet) is in his place tonight. I know he has been following the debate very closely. I hope he will follow what I have to say.	.
First, I think this has to be said. It has been mentioned by other members in the debate. It seems we should have been dealing with this bill six months ago, if not a year ago. That would have given us an opportunity to give it the kind of scrutiny and the kind of committee study that it requires.
There are many good, very commendable features in the bill. Quite frankly, there are also parts of the bill that bother us. They require much closer scrutiny. Consequently we are looking for the opportunity of giving the bill, if the life of this parliament permits, the kind of scrutiny in committee that it so justly deserves and warrants, especially given the performance of this minister during his tenure as minister responsible for housing and Central Mortgage and Housing Corporation.
I wish to speak on one aspect of the bill, namely, the program that will replace the Assisted Home Ownership Program. There is no question about the commendable objectives

February 26, 1979

of the AHOP program. It has succeeded in making affordable housing available across this country to people who normally would not be able to afford to buy a home, especially in this inflationary period we are going through at the present time. It has succeeded in that objective.
Perhaps one of the reasons AHOP is in trouble, and it is in serious trouble notwithstanding the fact that it is about to be scrapped and replaced by a new program, is because it was put in place with unseemly haste. Projects were approved without due regard to the inspection capability of the corporation or of the Ministry of State for Housing and Urban Affairs.
What should have been a bonanza for the low income earners who could not afford housing has in fact turned out to be a bonanza in the form of a substantial windfall to some of the developers and builders in this country, some of whom set up fly by night operations merely to cash in on the government's haste to get on with the AHOP program.
One only has to go across this country and look at some of the projects that have been built under the program. I have seen several. In the city of Surrey, in the Vancouver area, there is an AHOP program which is disgraceful. I hope my colleague who represents that part of the country will enlarge upon that. I find the situation all across the country. Montreal has a substantial AHOP program with serious problems because of inadequate inspection, hasty construction, and the use of substandard building materials. The same is true in the city of Hamilton and in my own city of St. John's.
It is that program in the city of St. John's that I want to speak about tonight for a few moments. I do so because it happens to be in my constituency and because of the fact that I believe what has happened in the Virginia Park AHOP program is unfortunately typical of what has happened to other AHOP projects across the country. Let us take a look at it.
This project was built by a contractor who formed a special sub-company, if I can put it that way, to carry out this project. That company no longer exists. What does exist is over 100 houses on which the brick is deteriorating. Substandard building materials were used within and without. There is faulty plumbing, faulty wiring, inadequate insulation, indeed in places no insulation at all, all pointing to the fact that this project obviously did not receive adequate inspection.
As a result of some very good investigative reporting by the CBC program "The Fifth Estate", aired on December 5, there is now an RCMP investigation into allegations of pay-offs by the builder to CMHC inspectors. Charges have not been laid but the allegations have been made and the investigation is under way.
I first brought this matter to the attention of the minister almost two years ago. At that time the complaint did not relate to faulty brick as that had not made itself apparent. I was requested by the people who were buying these homes under the Assisted Home Ownership Program to inspect personally some of the grievances they were trying to get redressed by
Housing
CMHC. I saw first hand in these houses the use of bathroom fixtures that, at best, could only be described as seconds. For example, one thing I noticed in several of the houses I visited was that the bath tubs had cracks in them. I asked the home owner who first identified this what excuse he had been given for this. He said he had been told that one of the workmen had dropped a hammer into the bath tub. I found that this workman had dropped several hammers in that particular block because every second or third house I examined had a bath tub with a crack in it. Similarly with the sink fixtures, they were just hanging from the walls.
There was inadequate plastering and the windows dit not fit, to the point that on a rainy day with the wind blowing in a certain direction the rain would come inside the house. There were problems in relation to inadequate insulation resulting in unusually high heating bills. All these things were identified in that project several years ago. Letters were written, but nothing was done about them. It took the deterioration of substandard brick to bring this matter to a head.
When this bill does get before committee I will have the opportunity to lay the whole sordid picture of the Virginia Park AHOP project before this House in the form of photographs, affidavits, engineering studies and the whole bit.
What I and these people find difficult to understand is the attitude of the minister and of CMHC. This matter has been raised on a number of occasions in the House by myself, and the response from the minister has been to the effect that this is not the responsibility of CMHC. What was their response when confronted with this? Their response was that they would make additional moneys available to the owners of these houses so they could carry out the necessary repairs themselves. On the face of it that seemed like a reasonable offer, until it was discovered that what they intended to do was make the additional moneys available to the home owners and then add it on to their mortgages, giving them a year or two before they had to start paying back the additional moneys. In addition, they would have to pay back an unfixed interest rate on the money for that period of time during which payments were not made. That was the generous offer the minister made.
In reply to my question of January 23, the minister said as reported at page 2440 of Hansard'.
The offer does not only include an increase in the loan, but the possibility of subsidies attached to this offer of an extra loan in order to allow people to make urgent repairs to their homes. Discussions are going on at the present time between the CMHC regional director and the lawyer representing some of the owners, but I should like the people concerned to look fully at the advantages which are offered, because CMHC is going beyond normal practice in trying to accommodate them and help them solve their problems.
These are not their problems because, unless the minister comes to his senses, or a case can be made in committee following which the minister adopts a more reasonable and positive attitude, this will be a question for the courts to decide.
What we are looking at here is a project in respect of which CMHC approved the builder in the first instance. CMHC had to approve the site and approve the plans of the buildings. It

February 26, 1979
Housing
had to approve the materials that were being used, and had to inspect the construction throughout, and in fact make the final inspection before making progress payments available to the contractor. That all took place before the home owners came into the picture, so there is no question about where responsibility lies.
Although the minister has not told me this, has not said so in the House, the reason the minister and CMHC have taken this attitude toward the Virginia Park AHOP project is that they are afraid of opening the flood gates. They know there are literally hundreds and hundreds of AHOP houses across this country which people bought from CMHC in good faith, secure at the time in the knowledge that they had been inspected by the national housing agency of the Government of Canada and approved by that agency. They felt they had a reasonably good investment, but found when they moved in that the houses had been inadequately inspected. That is the only logical conclusion you can come to after examining these projects, not just Virginia Park. You must come to the conclusion that in fact somebody had failed to ensure adequately through the inspection process that first class materials were being used throughout.
CMHC has now taken the attitude that these people have to assume the financial responsibility for this faulty brick, for the inadequate or substandard building materials, and for the inspectors who must have been blindfolded when they inspected and approved some of these things I saw first-hand. These people are expected now to pay for the mistakes of the Minister of State for Urban Affairs and for the mistakes of CMHC. Can you imagine the minister and CMHC now saying these people who have had their problems fully identified by the National Research Council, which did a study of the brick, and by professionals who were readily able to identify some of the serious flaws in construction and some of the substandard materials used, are themselves responsible? Can you imagine them saying they will provide the funds necessary to make the repairs but will add them on to the mortgages? They will not indicate what interest they will have to pay on that money until a year or two down the road. In the interim they will get the money that will be added to their mortgages and will have to pay interest for the use of that money.
These people have unanimously rejected that offer outright. There was not one single dissenting voice to that rejection. There was no political coercion, because they spoke through their solicitor, a gentleman by the way who has been doing a first-class job on behalf of these people notwithstanding that at one point in time he was a Liberal candidate in St. John's
East. He has been doing a first class job for these people, without any remuneration whatsoever. There is no political motivation behind what has been happening at Virginia Park, but each time this question has been raised in the House the minister has admitted that a problem exists. He has also been very quick to admit that in no way could the corporation be considered financially liable for what has happened to these homes. What has happened to them?
My colleague, the hon. member for Selkirk (Mr. Whiteway), has referred to the fact that many of these homes have depreciated in value, partly because of the fact that the housing market has levelled off, but largely because of the fact that many of them were built, all at the same price, and held at a certain level. Let us say I am in the city of Toronto and I pay $45,000 for my house. Someone moves in next year and pays $45,000 for his house, so the price of my house remains the same. These houses have depreciated in value because of faulty construction and substandard materials, yet the minister and CMHC fully expect these people to add on to their financial liability and to increase the cost of houses which have in fact depreciated in value. It is not difficult to understand why such an offer was rejected, if it can be dignified by being termed an offer.
The offer was rejected outright. I am not concerned about the flood gates. I am not concerned about the fact that the minister may very well be setting a precedent if he decides to deal with Virginia Park in a just way. He may be setting a precedent he will have to live with in Montreal, in Hamilton, in Vancouver, or wherever this problem, which seems to be characteristic of AHOP across the country, occurs. I am concerned only with seeing that justice is done for those people who bought those houses having faith in National Housing Act inspections and through the good offices and because of the good reputation of the Central Mortgage and Housing Corporation. I look forward to confronting the minister when this matter goes to committee. I serve notice to the minister right now that although he may think he will get this bill through expeditiously because there are some commendable features, and because he is bringing it in the dying days of this parliament, until we get satisfaction on these AHOP projects across the country, and certainly until I get satisfaction on what has happened to the AHOP project in my own constituency-


Benno Friesen: And mine.


James Aloysius McGrath: My colleague talks about his.


An hon. Member:: Filibuster.


James Aloysius McGrath: The hon. member can call it a filibuster if he likes, but we have a responsibility to represent our constituents in this House, and I intend to bring before the committee evidence which will indicate beyond reasonable doubt just exactly where the fault is and where the blame lies. The minister should be prepared to change his attitude and come up with a reasonable solution to this problem. What I would call a reasonable settlement would be a cash settlement after an adequate assessment as to the extent of the damage has been made, a cash settlement with no strings attached. In other words, the people involved should be able to repair their homes, replace the faulty brick, replace the faulty windows, replace the faulty fixtures-


Mr. Brisco:: Replace the minister.

February 26, 1979


James Aloysius McGrath: -and put in proper insulation, and they should be able to do that without being out of pocket one dollar. We will settle for nothing less because I think these people are entitled to that. Simple justice demands that, and as a representative of people who are victims of one such AHOP project I intend to settle for nothing less.


Mr. Marcel Roy (Laval):: Mr. Speaker, I am pleased to take the floor on this important piece of legislation concerning our population's most urgent needs.
If I may, I would first like to comment on the speech just made by the hon. member for St. John's East (Mr. McGrath). To me, he seemed more like a housing inspector than a legislator. He mentioned a few isolated cases of possibly inadequate construction, but he once more reflected his party's attitude; as far as construction is concerned, his party has barely reached the plumbing phase, whereas the Liberal party is into urban planning.
The attitude shown by the hon. member who preceded me exactly reflects the position of a party lacking in imagination, except to limit itself by telling Canadians: Ask your municipalities to increase your municipal taxes and we will give you a $2 billion federal income tax credit.
Mr. Speaker, this is applying a band-aid where a review of the planning process is needed. I am proud to belong to a party which has improved the construction situation in this country; the picture is highly positive when one considers that an average of 250,000 units have been built in Canada the last four years. We note that, from 1967 to 1977, we have, through the federal housing agency, built a great number of housing units-an average of 10 new units per 1,000 inhabitants.
I would like to take this opportunity to thank the ministers responsible whom I see here tonight: the President of the Board of Economic Development Ministers, the hon. member from Thunder Bay and also the hon. member for Papineau, the present Minister of Public Works, who were largely responsible for these initiatives and achievements in housing. I think that in the eyes of Canadians these figures and these achievements are much more serious and positive guarantees for the future than the speech made by the hon. member for St. John's East, where he dealt with specific cases out of the number of housing units in Canada that I mentioned. He preferred to speak of local problems rather than deal with this issue to the extent covered in the legislation before us.
The purpose of this bill, Mr. Speaker, once the provinces have been consulted, is to adopt a global approach to federal financial assistance to municipalities by combining the neighbourhood improvement program, the municipal infrastructure program and the municipal grants program in a single community services grant program. One of the objectives, and certainly not the least, in view of the present housing situation for low
Housing
income earners and the fact that under existing agreements we are building 19,000 housing units, is to build 30,000 such units for low income earners.
The federal and provincial governments agreed to finance those three programs to the extent of $150 million for 1979, $250 million for 1980 that will be distributed at the provincial level through community services contributions based on the population and the financial capacities of the municipalities.
For the information of hon. members and particularly the people who are listening and watching us, the province of Newfoundland will get through this new legislation $4.2 million in 1979 and $7 million in 1980. As concerns the province of Quebec, it will get about $47 million for 1979, and $78 million for 1980. I shall not list the amounts for each province but it is clearly mentioned in the legislation.
Mr. Speaker, I am very optimistic as concerns our performance in the housing field, and the infrastructure at the municipal level, and as the hon. member for Laval, which is the second largest municipality in the province of Quebec, in population and area, I can say that we benefited from the help given by the Canadian government to all those programs. I think that as concerns the population of Laval, I must congratulate the Canadian government and the minister responsible, who is now Minister of Public Works, for the precious contribution we got through those various programs, the social housing program, the infrastructure program or the municipal assistance program, to allow municipalities to make the most economical possible use of the land for building projects in view of the increasing cost of public utilities. As an example, the amount of $2,157,000 was given to the city of Laval under this assistance program for municipalities which want to build in high density residential areas. If we take this amount and relate it to general rates, this meant a reduction of 3 per cent in general rates for all residents in the city of Laval in 1976-77 and will probably mean the same thing this year. If we take a house assessed at $40,000, this means $120 per home owner under the policy which was cancelled last December.
Even though I am quite optimistic about this program and the results obtained by Central Mortgage and Housing Corporation, I am much more concerned about this bill, as I told the minister when he appeared before the Standing Committee on Health, Welfare and Social Affairs. I expressed my concern while being well aware that this was a request made by the provinces under the pretext that it come under provincial or municipal jurisdiction, which is quite true, but we have accepted that this become more and more a provincial responsibility, and the various projects will be approved following applications made by the provinces.

February 26, 1979
Adjournment Debate
Let us look at the situation of social housing in 1977. Mr. Speaker, I refer you to the annual report of the Central Mortgage and Housing Corporation. We can read the following on page 20, and this describes in summary the interest shown by the provinces in the development of social housing. The House will see how my concern is justified if we take into account what I have just mentioned. This is what it says:
The largest shortfall in loan commitments under CMHC's 1977 capital budget was for the construction and acquisition of housing for low and moderate income people. This was particularly marked for public housing to be rented to tenants according to an approved rent-to-income scale. Commitments for this type of housing financed with loans by CMHC to the provinces, and by joint investment undertakings by CMHC and the provinces, totalled only $199 million in 1977 compared to a budget allocation for the year of $353 million.
-which means that $199 million of the $353 million available were used, and I continue:
In 1976, some $403 million had been committed for these purposes under the National Housing Act.
So we can definitely see a rather considerable reduction in the amounts which were made available to the provinces for public housing. I bring to the attention of all provinces and of all organizations that if this amendment is made through the Central Mortgage and Housing Corporation Act, we shall reach our objectives, namely to increase the number of housing units for low income people.
May I call it ten o'clock, Mr. Speaker?



PROCEEDINGS ON ADJOURNMENT MOTION

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

Robert Hylton Brisco: Mr. Speaker, on February 20 I addressed two questions to the Minister of Transport (Mr. Lang) relative to the firefighting equipment at Castlegar and the navigational aids at Castlegar airport. In his response the minister made what I consider to be an innocent mistake, one which I drew to his attention as a point of order a couple of days ago. Whereas I was talking about third party contract agreements, the minister was under the impression that I was directing my question to the subject of insurance contracts for smaller airports across the country.

I am well aware of the fact there are a number of smaller airports across Canada which were concerned about this particular problem, and that the minister covered some 37 airports with a $100 million liability insurance per airport. In itself that action has taken a great deal of strain off the concerns of the smaller regional municipal airports. The minister failed to understand in my question that I was referring to third party contracts, the habit of the government to turn over the operation of regional airports to a third party. There are a couple of classic examples.
I suggest Your Honour should look at Resolute Bay where, in a period of a few years, there was a 229 per cent increase in the operational costs of the airport. Also we can look at the record of Frobisher Bay operated by the Tower Corporation out of Montreal. We will see that Nordair and its pilots expressed considerable dissatisfaction over the operation of that field. We see in a very remote area an airport which recently was blocked completely from any contact with the outside world through that travel mode by virtue of several days of blizzard. We see an airport which does not have a fire chief and does not have the type of firefighting expertise one would expect to be in place in an airport with such a remote location.
When the briefing session was held for the people bidding on the third party contract for Castlegar airport, it was interesting to note that some of the bidding parties did not even know where Castlegar was located. Some had mistaken Cranbrook for Castlegar. Some thought it was somewhere in the northern part of the province. Others did not know where it was. There were three firms in Castlegar which bid on the operation of that airport. Although I am not fully convinced the third party operation is the route to go, certainly I would prefer being in a position to deal with a local contractor. But on the basis of the bids submitted, it appears the award may well go to Agda Ltd., a firm of consulting engineers in Ottawa. It could go to the second highest bidder, the Tower Corporation of Montreal. I think my suspicions will be borne out in fact. I suspect that any of these firms removed from the city of Castlegar will have that operation run by subcontractors. Not only do we see the operation of the airport run at arm's length or at some considerable distance, also we see subcontractors running the airport. The service at that airport will deteriorate as a result of this kind of nonsense.
In terms of the navigational aids which I raised with the minister, and in terms of firefighting equipment, Castlegar has received nothing but empty promises. They were promised a foam truck over a year ago. They still have no foam truck and no facilities for storing it in the winter, as foam freezes.
Castlegar was promised a new navigational aid to replace the one which comes out of the Smithsonian Institute located at Crescent Valley, a navigational aid which is so old that the ministry has trouble finding spare parts for that particular unit. Yet these promises have not borne fruit.
February 26, 1979

We find that the Ministry of Transport denied Castlegar airport the construction of a sand shed so that the sand would not freeze. They said that it would be too expensive, so it was taken out of the airport budget, and the workers themselves at the airport built it, solidly, for $6,000. We find that Kelowna has an aluminum frame building which is sitting there and getting mouldy with age. This building sat there for a year and nobody knew who ordered it, why it was ordered or what it was to be used for. Yet it was there, but there was nothing for Castlegar. Penticton has 61 employees under the Ministry of Transport, but Castlegar has less than half that.
In terms of navigational aids the minister has said that he is concerned that they use navigational aids according to the geographical conditions of that particular area. No other airport in Canada is more qualified for a VOR than Castlegar. The approaches to Castlegar are exceedingly narrow. It does not qualify under any of today's terms of instrument landing technology for instrument landing. Therefore it is time that Castlegar received a VOR and that the minister stopped fooling the public.


Mr. Charles Lapointe (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, I would like to provide a brief bit of background information in response to the question by the hon. member for Kootenay West (Mr. Brisco), dealing with firefighting equipment and navigational aids for the airport at Castlegar.
A contract operation of the airport has become necessary because of a decision made by the city of Castlegar to cease operating the airport effective March 31 of this year. The city has been fully consulted with regard to this course of action. Other possible, but less favourable, options would have been the closure of the airport or operation by Transport Canada.
It is planned, Mr. Speaker, to place a small foam crash truck capable of carrying 400 gallons into Castlegar airport around the middle of April this year. This vehicle will remain in Castlegar until such time as deliveries of medium foam trucks, capable of carrying 1,000 gallons, commence from the next contract. The next contract for airport emergency vehicles is in the tendering stage at the present time, and one medium foam truck for Castlegar is included.
The "D" category airport in which Castlegar falls requires a first response truck and a foam truck of 850 gallons capacity. Castlegar already has a first response truck. With the addition of the small foam truck of 400 gallons, it will be slightly deficient in the amount of water carried during the interim pending arrival of the new medium foam truck of 1,000 gallons.

In August 1978, the installation of a localizer beacon with distance measuring equipment, commonly called DME, in Castlegar was approved and the project was to be carried out in 1982-83. Since then, Mr. Speaker, it has become possible to carry out that project in 1980-81.
Adjournment Debate
Such equipment will replace the low-frequency range used in Castlegar and will provide better signals to pilots making ILS approaches. In addition, DME facilities on the ground will give a more accurate distance between aircraft and airport to planes equipped with that device. The information provided by both navigational aids will give the pilot a better position reading during the ILS approach, which is an improvement to the navigational aid system of that airport.


FISHERIES-NEGOTIATIONS RESPECTING ALASKA COAST HALIBUT FISHERY
Benno Friesen: Mr. Speaker, on February 20 I rose in the House to ask the Minister of Fisheries and the Environment (Mr. LeBlanc) the following questions'.
What is the status of negotiations relative to halibut fishing off the Alaska coast?
And, secondly, I stated:
-the fishermen in that area are very concerned that their privileges will be exchanged for rights granted in eastern waters. They have registered their protest with the minister with respect to this matter. Reports are that they will be excluded from American waters and they will have to go to Canadian waters which are already overfished.
There are at least four areas of concern, and possibly more, which the fishermen in British Columbia have. I raised the matter in the Standing Committee on Fisheries and Forestry just a few days ago, but I did not get much more satisfaction from the minister at that time than I have received in this House.
In committee I discovered that the United States government served notice on the Minister of Fisheries several years ago that they were planning to end the halibut fishing convention which has been in operation for something like 55 years off the cost of Alaska. If the minister knew two years ago that there was going to be some finality to this agreement, why did we not have a fallback position? Was there no back-up position for our negotiators when they went to Juneau to negotiate last September?
The second important question is: what happens to the halibut fishermen during this time? The negotiated settlement with the United States provides that this year Canadian halibut fishermen will be able to catch half of their normal catch quota, and next year it will be one quarter of their normal catch quota. A fisherman who is handed an ultimatum that he can only catch half as much as in other years would begin to worry about his income, especially if he has a boat with a crew of four or five to look after. He must wonder how he is to make a living. There are from 40 to 60 craft with a total crew of up to 250 people who must wonder what they will be doing this summer. If that is to be the normal catch, half of them must be wondering, and the rest will have to wonder after next year. If we consider the gross products involved in
80050 - 15

February 26, 1979
Adjournment Debate
Canadian export, then we must worry because there is no other market for them at the present time.
The next problem is one of confidence. The halibut fishermen are organized into about nine different groups. All were invited to go with Ambassador Cadieux to help negotiate the settlement. After the negotiations were settled they sent a news release to the minister saying unanimously, "We are opposed to this agreement because we cannot make a living with this kind of settlement." I grant that one person did not sign because the Minister of State (Fitness and Amateur Sport) (Mrs. Campagnolo) called him directly and asked him not to sign. The rest of them all signed as being opposed. They would rather have settled for three million pounds than the two million and be cut off entirely next year, than get the kind of half life settlement they are subject to this time.
Regardless of what the fishermen wanted, Mr. Cadieux accepted it. I cannot help but wonder why they were invited in the first place. If people who know something about the industry first hand, unanimously rejected the agreement, then what was the ambassador trying to do?
My fourth concern is about what will happen to the ground-fishermen off the coast of Vancouver Island. In committee the other day the minister admitted that those stocks are already at a critical stage of depletion and that we cannot afford to fish them much more extensively than at the present. Surely the United States fishermen in the area are going to get all they can from those fishing grounds. I wonder about the kind of surveillance the Department of Fisheries has been exercising when our stock cannot reach that state. We have something like 140 trawlers out there working those fishing grounds which are at a critical level already. What happens if 40 or 60 halibut fishermen are introduced to the area? The United States fishermen who are withdrawing will be replaced by Canadian fishermen coming into the area.
Finally, there is one more concern that I need to put on the record. That is the presence of factory ships. The minister has introduced licences. He says all the time that these are for stocks that Canadians are not accustomed to fishing and processing. That may be true, but that does not mean that they are not doing it. With the kind of surveillance that we have in that area, I question whether that Polish ship, or whatever flag it is flying, is restricted to that kind of a licence.
I asked the minister a very pointed question in the lobby several weeks ago. He had his executive assistant with him at that time. My question was: what kind of a labour agreement does that factory ship have because the fishermen in B.C. are wondering about it. It was a secret negotiation, apparently. The minister turned to his assistant and asked him to find out and to let me know. To this day I have not heard what kind of an agreement or contract it was. Those fish are being caught out there, they are being processed and transported out there, but the Canadian economy gets no tax benefit and apparently little labour benefit from it. Canadian people, and certainly the fishermen on the west coast, have a right to know what

kind of an agreement has existed between the factory ship- that flag ship-and the Government of Canada.


Albert John (Jack) Pearsall: Mr. Speaker, negotiations between Canada and the U.S.A. concerning Canadian halibut fishing off Alaska took place in Juneau, Alaska, February 14 and 15, and a proposed agreement was worked out. It has not, and I wish to emphasize at this time that it has not been approved by the two governments. The Canadian and the U.S. negotiators have made recommendations to their respective governments that, if approved, would mean the continuation of the International Pacific Halibut Commission and the phaseout of Canadian halibut fishing off Alaska.
Under the proposed agreement, Canadian fishermen would be allowed to catch two million pounds of halibut off Alaska in 1979 and one million pounds in 1980. In other words, compared to what Canadian fishermen took in 1978, they would be allowed to take about 55 per cent of that amount in 1979 and about 30 per cent in 1980. The two negotiators have also agreed to recommend that U.S. vessels be allowed to catch 3,250 metric tonnes of groundfish off British Columbia in 1979 and 1980, or about 40 per cent of recent levels.
I would like to point out that the Canadian halibut fishery that was under discussion was carried out in waters under the fisheries jurisdiction of the U.S.A., and if an agreement were not concluded, Canadian fishermen would not be allowed, and I repeat would not be allowed to fish for halibut in 1979 or subsequent years.
I would also like to reaffirm a statement made by the Minister of Fisheries and the Environment (Mr. LeBlanc) in the House on February 19, that if there is to be dislocation of the Canadian halibut fleet, a program of relocation is being considered. Officials have interviewed almost all of the owners of vessels which have fished in that area, and a program is being designed that will take into account the individual circumstances of the fishermen affected either by an abrupt termination of the Alaskan halibut fishery, or through a phase-out.


NATIONAL REVENUE-SALES TAX ON STORM WINDOWS AND DOORS
Mr. Jack Hare (St. Boniface):: Mr. Speaker, I rise in the hope of obtaining a sensible answer to a question I put to the Minister of National Revenue (Mr. Abbott) on Tuesday, February 20. It concerns energy conservation in the home. It specifically relates to the government's decision in the November 16 budget to reimpose the 5 per cent federal sales tax on storm windows and doors. These are items which heretofore had been tax exempt.
I have received a communication from a manufacturer in St. Boniface who is in the door and window business. He is a small manufacturer and employs about 60 people. This is a very important industry in St. Boniface. In a telegram to the Minister of Finance (Mr. Chretien), my constituent stated:
February 26, 1979

Your reimposition of the federal sales tax on windows and door defeats discriminately our purpose in reducing energy wastage in this world energy crisis. You have deflated us and left us cold. We now see no purpose in pursuing the critical need to manufacture good double and triple windows to save energy. If every house in Canada was supplied with single windows then perhaps you would realize the importance of good windows and doors in this energy crisis. It is unfortunate that with the stroke of a pen and without any consultation with our industry you elected to penalize particularly the people in the cold west.
I ask the minister to explain the rationale behind this change in tax policy. In all fairness I should mention that the minister has made a stab at an explanation in a letter sent to my office on December 13. In that letter the minister explained, in a bewildering example of logic, that:
The exemption for storm doors and storm windows was originally intended to be confined to these goods for installation on existing buildings. This was not found to be practicable, however, and as a result, all double glass windows and glass cladding material became exempt from sales tax. As glass is less efficient in energy conservation than solid wall construction, the exemption did not achieve its original intent.
The government has made a point of professing its support for measures which would conserve energy. I wish to quote one short paragraph by a scientist with the Economic Council of Canada:
The implementation of energy conservation programs will benefit Canada more in both the short term and the long term than equivalent investments in new energy producing facilities, according to a paper by D. B. Brooks.
The government has encouraged Canadians to turn unnecessary lights off, to put on a sweater before adjusting the thermostat. Indeed, considerable lip service has been paid to saving energy. The government claimed the need to create an energy conscious atmosphere in Canada, with the idea that reduced consumption of energy would result in reduced dependence on imported oil. It is a worth-while and necessary pursuit. The energy crunch has everyone concerned. Only last week the government introduced legislation enabling it to ration energy supplies in case of emergency.
Conservation is a vital part of any national energy strategy. As we seek out new, more reliable sources of supply, we should also be working simultaneously to bring in measures which encourage more efficient use of energy. The reimposition of sales tax on storm windows and storm doors, as well as the continued taxation of insulated steel, one door systems, is lamentably misplaced, in that it acts to discourage efficient use of energy. There had been a good reason for the previous tax exemption on these items, namely, that double and triple glass storm windows and doors make a substantial contribution to the conservation of energy in the home. Now, because the minister has surmised that "glass is less efficient in energy conservation than solid wall construction", storm windows and doors are to be taxed. I really wonder if the minister expects us to live in houses with no windows? Of course glass is less energy efficient than solid walls, but double and triple glass is a lot more efficient than single glass.
Another concern arising from that confused letter is the distinction the minister makes between the need to encourage installation of energy efficient windows and doors on existing buildings and an apparent disinclination to provide for the
Adjournment Debate
inclusion of these same items on new buildings. Should not all buildings be equipped to conserve as much energy as much as possible?
I sincerely hope this government is interested in providing incentives for the conservation of energy. In the United States, not only is there a tax exemption on the sale of storm windows and doors, but a tax credit of 15 per cent is available for their installation. Somehow U.S. taxation officials in all their wisdom are able to get around the obstacles which dumbfound our government in its purported efforts to promote energy conservation in the home.
In Canada as well there has been recognition of the energy conservation value of double and triple glazed windows and doors. The Associate Committee of the National Building Code, of the National Research Council, determined in 1978 that within certain specifications double and triple glazing of windows or single glazing with a storm sash provide the necessary thermal resistance to be considered energy efficient. I wish we could make the government realize the value of insulated windows. We would like to see a co-ordinated energy conservation strategy put in place.


Mr. Yves Demers (Parliamentary Secretary to Minister of National Revenue and Minister of State (Small Business)):: Mr. Speaker, when the June 23, 1975 budget was brought down, the hon. John Turner announced three important changes in the excise and sales tax. Those changes included an exemption for storm windows, storm doors and double glass windows to be installed on existing buildings. The purpose of that exemption was to encourage the owners of those buildings to conserve energy.
It was realized that those double glass windows were being used not only on existing buildings but also in the construction of new ones. The use of those windows in the latter case was giving a fiscal advantage to the users of glass over the users of other conventional materials. The latter usually have to pay a tax at the reduced rate of 5 per cent. Let me give you as an example in the national capital: the Place du Portage buildings are built of pre-stressed concrete, which is subject to a rate of 5 per cent, while the Bank of Canada building, whose outside face is made of glass, is consequently tax exempt.
The June 1975 budget provided an exemption for that glass when used on existing buildings but not on new ones. It proved to be very difficult to apply the act, the manufacturer being unable to control the use of his products. Mostly because of that administrative difficulty, it was decided to cancel that

February 26, 1979
Adjournment Debate
exemption in the November 16, 1978, budget. That is why, Mr. Speaker, the Minister of National Revenue (Mr. Abbott) gave the answer he did in his letter of December 13 to the hon. member for St. Boniface (Mr. Hare).


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

Tuesday, February 27, 1979