1979-11-21

THE RIGHT HONOURABLE THE LEADER OF THE OPPOSITION


Right Hon. Joe Clark (Prime Minister):: Mr. Speaker, I would like the permission of the House to move, under Standing Order 43, a motion which is seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House express its gratitude and appreciation to the Right Honourable the Leader of the Opposition for his service to the House, his party and country, and expresses its hope that he will continue, as the Right Honourable Member for Mount Royal, to contribute his formidable talents to Parliament and to Canada.
[Editor's Note:	Members of the House stood and
applauded.]


Mr. Speaker:: It is my pleasure to record that the unanimous consent of the House was given to the presentation of the motion and that it was obviously adopted unanimously.


Hon. Allan J. MacEachen (Cape Breton Highlands-Canso):: Mr. Speaker, if you are putting the motion, I would like to say a word on it.


Mr. Speaker:: The House has heard the terms of the motion. It is moved by Mr. Clark, seconded by Mr. Knowles:
That this House express its gratitude and appreciation to the Right Honourable the Leader of the Opposition for his service to this House, his party and country, and expresses its hope that he will continue, as the Right Honourable Member for Mount Royal, to contribute his formidable talents to Parliament and to Canada.


Allan Joseph MacEachen: Because this is a debatable motion 1 would like to take a few minutes to speak to it. I begin by expressing my sincere appreciation to the Prime Minister (Mr. Clark) for putting the motion to the House, which was received on both sides with great enthusiasm.
For myself, I would like publicly to say what 1 said to the leader of my party; that is, how deeply saddened I am at the decision he has taken to step down from the leadership of the Liberal party. It has been my view since the last election that the right hon. member for Mount Royal (Mr. Trudeau) could continue to lead our party and could succeed in returning this party to office in the future.


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: That is my belief, has been my belief, and it is my belief today; though 1 do respect the decision that has been taken by the leader of the Liberal party. I want to say, in conclusion, that every one of us sitting on this side of the House has been totally behind our leader in his leadership. In making the decision he has made today, he makes it with the full knowledge that he still has our total support.


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: And he will continue to have our respect, admiration and affection.


Some hon. Members:: Hear, hear!


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, as the hon. member for Cape Breton Highlands-Canso (Mr. MacEachen) has pointed out, this is a debatable motion. But I would not want to talk it out; 1 am afraid that if we talk past 2.15, it might not be carried. I wish to thank the Prime Minister (Mr. Clark) for naming me seconder of the motion. I am happy to associate the members of my party with the tributes and good wishes to the Leader of the Opposition (Mr. Trudeau) contained in the motion.
It has been a pleasure for many of us to be associated with the right hon. member for Mount Royal through his years in Parliament. His contribution to the country cannot be gainsaid. He has been subject to criticism, but he knows best of all that the one way not to receive criticism is to do nothing at all. That has not been the story of his life.


Some hon. Members:: Hear, hear!


Stanley Howard Knowles: This his hardly the day to predict the outcome of the next election, but we are happy to join with the House in this tribute to the Leader of the Opposition.


Some hon. Members:: Hear, hear!


Mr. Fabien Roy (Beauce):: Mr. Speaker, had the motion required another seconder needless to say I would have been pleased to act as such. I wish to join those who have paid tribute on this occasion and speak on behalf of my colleagues, because under such circumstances I think it is appropriate to forget partisanship and to pay homage to an individual who as Prime Minister has devoted more than ten years of his life to his political party, his fellow Canadians and his country. We

November 21, 1979
Tributes to Mr. Trudeau
may or may not have agreed with his performance or his comments, but it should be said that he knew how to fight for his convictions and for his ideal with honesty, frankness and determination. Especially with dignity. And so, Mr. Speaker, his departure marks not the end of a page in the history of Canadian politics but indeed of a whole chapter. In concluding, on behalf of all my colleagues 1 would like to wish him many more years of active life.


Hon. Jean Chretien (Saint-Maurice):: Mr. Speaker, having had the honour of being sworn to the Privy Council on April 4, 1967, the same day as the hon. member for Mount Royal (Mr. Trudeau), the leader of my party, on behalf of my colleagues I would like to thank him for everything he did for Canada. I had the opportunity during my career to work twelve years with the Leader of the Opposition. I had the opportunity to work with him when he was Prime Minister. I travelled throughout Canada during many years and also to the four corners of the world and 1 have always been very proud of being a colleague of Mr. Trudeau, a citizen of Quebec, and enjoying the privilege of working with a man who has always been for all Canadians, especially French Canadians, a source of pride and satisfaction.


Hon. Robert K. Andras (Thunder Bay-Nipigon):: Mr. Speaker, as one of the older hands elected from the province of Ontario, I just want to add, on behalf of Ontario members of the Liberal party and the many thousands of people behind them, our appreciation for the leadership and excitement that the Leader of the Opposition has given us through his 12 years of performance for this country in a very significant office.


Some hon. Members:: Hear, hear!


Right Hon. P. E. Trudeau (Leader of the Opposition):: Mr. Speaker, I suppose it is typical of me, as a member of this House, to ask you not to see the clock for another 30 seconds and bend the rules once more.
I appreciate the consent of the House in allowing me to stand and say that I am deeply moved by the expressions of support for the motion moved by the Prime Minister (Mr. Clark) and seconded by the House Leader of the New Democratic Party (Mr. Knowles), to which the Creditistes leader (Mr. Roy) and my colleagues-beginning, of course, with the deputy leader of the opposition-all spoke. It is an irony of our profession-we are all aware of it, all of us who sit on the floor of the House, I suppose including yourself, Mr. Speaker-that people only really begin to admit our qualities when we are on the way out.


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: It is a kind of convention with which we are all acquainted, and when we hurl insults at each other, we know that in reality we have a fair amount-perhaps a great deal-of admiration for people who, like ourselves, have decid-

ed to ask Canadians in their constituencies to support them in a task which is sometimes thankless and, certainly, nearly always exhausting. We know that underneath the partisanship we must show there is a basic, underlying admiration for each other, if only because we have agreed to serve our country in the same way, in the same forum. Perhaps there is here a lesson for those who take all our insults seriously.
I read in a magazine a few weeks ago that the profession of politics is held in very, very low esteem by the people of our country-away below sportsmen, actors and everybody else. I suppose the explanation perhaps is that in a sense we are paid to belittle each other, and the people who watch us may believe that we are doing it in a way which decreases the value of service to this profession. I wish to use this occasion to say that that is apparently not the case. The sincere and warm wishes which my friends and my opponents have given me today indicate that there is great respect among ourselves for the basic cause that we are all serving-that of Canada.
[ Translation]
I should also like to give special thanks to my colleagues of my province who have always supported me, and repeat what I said this morning to my caucus and the country, that I shall always be ready to answer the call to arms in the fight to make Canada a strong and united country.


Mr. Speaker:: Shall I record that the motion has been carried unanimously?


Some hon. Members:: Agreed.
Motion unanimously agreed to.



ROUTINE PROCEEDINGS


Mr. Speaker:: Before beginning the oral question period, may I call attention to the presence in our gallery of a distinguished visitor in the person of the Minister of Agriculture of New Zealand, the Hon. Duncan McIntyre, and Mrs. McIntyre, who are here on an official visit.


Some hon. Members:: Hear, hear!
November 21, 1979



ORAL QUESTION PERIOD


Pierre Elliott Trudeau: Mr. Speaker, I have a question for the Prime Minister: it has to do with the events in the Middle East in general, and Iran in particular.
This House knows-and I believe the world knows-that there is only one way of dealing with international terrorism, and that is through international action. Countries have learned that over the years in trying to deal singly with hijacking of aircraft. Now that international terrorism is being sanctioned and condoned by the State of Iran, can the Prime Minister tell us if any action has been taken by our government in the international community in order to support the United States and to indicate that, against this form of terrorism, we all stand united behind the United States, as members of all three parties have indicated in the House through various statements in the past two weeks?


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Mr. Speaker, I welcome the question because it gives me the opportunity to indicate that Canada has taken every available opportunity to make known to the officials of Iran our deep objection to the abrogation of international practice that has been evidenced in their country, and has made known to the United States our willingness to be of assistance in any practical way we can to aid citizens of the United States in their very difficult circumstances in Iran.


Pierre Elliott Trudeau: Mr. Speaker, I congratulate the Prime Minister on these important and positive steps, but what I am really suggesting is that there is another stage now into which these events have been unfolding for more than two weeks. I believe there is another stage of action. We are not only a country acting alone. Whether it be Canada or some other country indicating support of the United States in condemnation of Iran, I think-as in dealing, once again, with hijacking-it is important not to have isolated states indicate their views and principles in support of Iran, and to be faced with the entire civilized community in a massive common front against the actions of the government of Iran.
The Prime Minister was in Tokyo. Perhaps he should begin with the other six who were there. He was at the Commonwealth meeting. Perhaps we should be dealing with heads of the Commonwealth. I believe it is not enough to tell the United States that we support them. My question to the Prime Minister is the following: Is it not time for Canada to take the initiative-if, indeed, it has not already been taken-to bring the entire civilized world to the support of the United States so
Oral Questions
that there be no chink in the armour, and that in this form of terrorism we stand united with the United States?


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Mr. Speaker, I agree completely with the view expressed by the Leader of the Opposition and concurred in, I believe, by all members of the House. I can report to the House and to the Leader of the Opposition that, in addition to the actions I indicated earlier, we have been working actively with representatives of other nations in Iran and elsewhere. In Iran, in particular, we have willingly assumed a role of some leadership in bringing together representatives of other countries in Iran, which has been made necessary by the fact that the dean of the diplomatic corps there-the representative of Czechoslovakia-has not been prepared to play the role of bringing together other nations. Canada has moved into that position.
We are also continuing actively to explore every other instrument available to us, whether through the United Nations, the Commonwealth or any other association that Canada has with other nations, to find effective means through which our views and the views of the civilized world can be brought to bear upon the authorities of Iran to bring an end to a situation which we consider unacceptable and wish to have terminated as quickly as possible.


Pierre Elliott Trudeau: A final supplementary, Mr. Speaker. I mention this in full realization of the fact that a lot of this action might have to be taken behind the scenes, at least in the early stages, and I do not want to probe the Prime Minister any more than is needed. However, if he has not in his answer indicated clearly that he has already done so, I hope he will, consider an initiative by Canada leading to active meetings of an increasing number of countries where we would, in a common front, tell the world that in this case it is not a matter of supporting the United States alone, but it is a matter of supporting the concept of civilized international law without which all order in the world would end.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: I appreciate the understanding of the Leader of the Opposition and other members of the House that in circumstances such as this the initiatives which are taken must very often be taken privately. I can assure the House that the Government of Canada has acted on a wide range of fronts to make exactly that point known to the authorities in Iran, and that we are prepared to consider and pursue any initiative which would be useful in ensuring that there is respect for international standards and international law in the Iranian situation.


Allan Joseph MacEachen: In view of the fact that the Prime Minister has made a very positive declaration today in the House-one which we welcome-and in view of the fact that the government of France has issued a similar statement following a cabinet meeting,

November 21, 1979
Oral Questions
would the Prime Minister consider, building on his own decision and that of the government of France, trying as a beginning to mobilize support by getting in touch with all the heads of the summit industrialized countries with a view to issuing a common declaration in support of the maintenance of international order?


Charles Joseph Clark: That is a very useful suggestion and we shall certainly pursue it. It would carry one step further, to heads of government level, the initiative which the government has already taken in Iran.


Allan Joseph MacEachen: In view of the deteriorating situation in Iran, especially in view of the increase by the American navy in its striking power through additional aircraft carriers, and in view of what must be the total unpredictability of what might break out in that country, would the Prime Minister not consider that now is the time to take action to remove Canadian personnel from Iran?


Charles Joseph Clark: We are, naturally, preoccupied about the safety of Canadian personnel. We are also aware that there is a role which Canada can play in Iran, one which we can only play effectively if there are personnel present. It is our judgment that for the time being, at least, it is in the interest of securing respect for international law and seeking to secure some resolution of the problem in Iran that representatives of our country remain there.


STATISTICS CANADA
Mr. Mark Rose (Mission-Port Moody):: Mr. Speaker, my question is addressed to the Minister of Finance. According to recent information, an interdepartmental meeting has revealed a $60 million error in the Statistics Canada estimate of labour income in the province of British Columbia-an error which has affected the calculation of equalization payments to the provinces. Has the minister decided to take any action either to recover funds or to pay out money to certain provinces to straighten out the situation caused by this error?


Hon. John C. Crosbie (Minister of Finance):: I am not
aware there was an error. If there was one, I have not been informed of it. If there is one, we would make the necessary adjustments. I might say that in connection with federal-provincial programs there are often errors discovered or new estimates or calculations made as time goes on. It usually takes two or three years before the payments are settled.


Mark Willson Rose: Mr. Speaker, I direct my supplementary question to the President of the Treasury Board. Since, in the past several years, criticisms about this agency and its operations have increased rather than subsided, does the minister intend
to investigate how an error of such magnitude could take place; and is he prepared to tell the House what he will do to see that it does not happen in future?


Hon. Sinclair Stevens (President of Treasury Board):: Mr. Speaker, in replying to the hon. member, I point out-as my colleague, the Minister of Finance, has indicated-that the difficulty generally arises from preliminary figures being adjusted when more final figures are put in place. The hon. member has indicated that there are certain questions about Statistics Canada. I have already indicated to the House that those questions are being reviewed by my office, and we will in due course be having something more to say to the House concerning Statistics Canada.


Mark Willson Rose: Mr. Speaker, considering what appears to be the appalling state of this vitally important economic agency, does the President of the Treasury Board intend to launch a full-scale parliamentary investigation into Statistics Canada?


Sinclair McKnight Stevens: Mr. Speaker, we have no present intention of recommending a full-scale parliamentary investigation into Statistics Canada, although there may be merit in having a review of Statistics Canada perhaps through a management consultant firm to determine what, if any, are the administrative, personnel and organizational problems within the organization.

| Translation]


EXTERNAL AFFAIRS
Fabien Roy: Mr. Speaker, I should like to come back briefly to the subjects broached by the Leader of the Opposition and the leader of the opposition in the House with regard to the American-Iranian conflict. I should like to ask the right hon. Prime Minister, since he has just told us that the government is not thinking of repatriating the Canadian nationals now in Iranian territory, whether all required arrangements have been made to guarantee their safe evacuation should it become necessary?


Charles Joseph Clark: Mr. Speaker, I can assure the hon. member that we have taken all possible steps, as we know, several months ago, we helped evacuate those Canadians in Iran who chose to leave the country. We decided, as I mentioned earlier, that it is a good thing not only for Canada but for everyone to have Canadian representatives in Iran who can try to play a part in resolving the situation.


Fabien Roy: I understand the government's proposal or decision, and I certainly agree with it. What I asked the right hon. Prime Minister was whether any measures had been taken in case such action became necessary, and I would also

November 21. 1979

like to know if there have been agreements or talks with allied of friendly powers to ensure that commitments are honoured on all sides.


Charles Joseph Clark: Mr. Speaker, we have made plans and we have had talks with other countries. I must admit frankly to the House and to the hon. member that it is impossible, in such circumstance, to be absolutely certain of the efficiency of our plans, but we have made plans, we have developed a way of helping Canadians in Iran to get out of that country, if they or the Canadian government consider it necessary.


INCOME TAX
Joseph Jacques Jean Chrétien: Mr. Speaker, 1 should like to ask a question of the Minister of Finance. Has the minister made a decision regarding the indexation of personal income tax exemptions, since traditionally the indexation rate was announced by the Minister of Finance in early November? We are now in late November and the indexation rate has not yet been made public by the minister.


John Carnell Crosbie: Mr. Speaker, that will be announced shortly, whatever the usual procedure is.


Joseph Jacques Jean Chrétien: Mr. Speaker, 1 wish to inform the Minister of Finance that the usual procedure was to make public those rates several weeks prior to January 1, because income tax return forms have to be printed, and the Minister of Finance cannot inform the Department of National Revenue without informing the public at the same time. Has the Minister of Finance made a decision and ordered the forms to be printed without making a public announcement?


John Carnell Crosbie: Mr. Speaker, as the hon. questioner agrees, this is not a matter which has to be announced several weeks before January 1. It has not been announced yet, but it will be announced in time to meet those deadlines. The hon. gentleman does not need to worry. If his question really is whether there is going to be indexing, the answer is yes.


FIVE-YEAR PLAN FOR INDIAN ASSOCIATIONS
Hon. Warren Allmand (Notre-Dame-de-Grace):: Mr. Speaker, I have a question for the Minister of State for Fitness and
Oral Questions
Amateur Sport. Considering that 85 per cent of our Indian population is under 26 years of age, and considering the many serious social problems which exist on our reserves-including delinquency and alcoholism-is the minister now ready to approve the five-year plan for sport and recreation submitted to him by the Indian associations of Canada and which has been in his hands for some time?


Hon. Steven E. Paproski (Minister of State for Fitness and Amateur Sport and Multiculturalism):: Mr. Speaker, I am glad that the hon. member had an opportunity to ask me this question. 1 met with the president, Noel Starblanket, on August 28. I met with him again just a week or so ago. The committee is preparing a five-year plan. 1 am to meet them in the middle of December to discuss their five-year plan. 1 hope by that time we can come to some agreement.


William Warren Allmand: Mr. Speaker, it is my understanding that the plan has been in the minister's hands for some time now. I know he is going to be very saddened by certain events in Montreal on Sunday. Perhaps he can give us an answer before the weekend.


Some hon. Members:: Oh, oh!


Steve Eugene Paproski: Mr. Speaker-


Mr. Speaker:: Order. The hon. member for Davenport.


Steve Eugene Paproski: 1 am not going to be saddened on either count.


ELECTRICAL POWER GENERATION-GARRISON DIVERSION PROJECT
Mr.   Chas. L. Caccia@Davenport: Mr. Speaker, my question is to the Minister of the Environment. It has to do with Canada's objection to the Garrison diversion project in the United States and the judgment of the International Joint Commission that it "would cause significant injury to health and property in Canada".
In addition, it is the intention of the NDP government of Saskatchewan to go ahead with coal-fired electrical generating plants without the installation of sulphur scrubbers and without waiting for the final report of the IJC. I would like to ask the minister if he can tell the House how the Government of Canada expects the United States to co-operate with us on the Garrison diversion project and other Canada-U.S. negotiations on environmental questions when we fail to co-operate with them on Saskatchewan electrical generation projects.


Hon. John A. Fraser (Postmaster General and Minister of the Environment):: Mr. Speaker, the hon. member has raised an important question, and gives me an opportunity to clarify the situation.

November 21, 1979
Oral Questions
I think it can be said that, while we would have preferred that Saskatchewan hold its announcement until after the International Joint Commission report had come down, it is important for the hon. member and all hon. members to realize that there is no real comparison between the known damage which will be caused if the Garrison project goes ahead and the anticipated very minimal damage which might-but not for certain-be caused if the Poplar River project goes ahead. The International Joint Commission is studying the Poplar River project from the point of view of water pollution, and it has nothing at all to do with air emissions. 1 can tell the hon. member and the House that so far as the air emission situation from the Poplar River plant is concerned, those emissions will meet standards both in Canada and in the United States.


Mr. Caccia:: Mr. Speaker, will the minister inform this House whether he intends to make representations to the NDP government in Saskatchewan to introduce high control standards for pollution for this specific project?


John Allen Fraser: Mr. Speaker, I can tell the hon. member that there have been extensive ongoing discussions between the Department of the Environment and the government of the province of Saskatchewan. We have its undertakings to place more stringent controls, if that proves necessary.


EXTERNAL AFFAIRS
Mr. Serge Joyal (Hochelaga-Maisonneuve):: Mr. Speaker, my question is for the hon. Secretary of State for External Affairs.
In view of the fact that in the Speech from the Throne, the government promised to reactivate our shipbuilding industry, does it intend to ask for a change in Canada's status on the OECD subcommittee on shipbuilding, since its two potential competitors, Sweden and Japan, are full-fledged members, while Canada has only an observer status?


Hon. Flora MacDonald (Secretary of State for External Affairs):: Mr. Speaker, I will be glad to take that question as a representation and get back to the hon. member.


HEALTH AND WELFARE
Mr. Bob Ogle (Saskatoon East):: Mr. Speaker, 1 have a question for the Minister of National Health and Welfare, but in his absence 1 will address it to the right hon. Prime Minister. Before 1 ask my question I should like to note, briefly, initial fears that PCBs were involved in the Mississauga train wreck and the fact that the Mississauga city council had banned the burning of PCBs within its boundaries. These are reminders, if any are still needed, of the grave danger to human health posed by chemical contamination.
In light of the above, 1 should like to ask the minister what has been the progress of the investigation carried out by officials of the Department of National Health and Welfare and of the Department of Agriculture into the contamination of livestock feed and, subsequently, of some poultry products which was discovered last month on the lower British Columbia mainland. How thorough has this investigation been?


Charles Joseph Clark: Mr. Speaker, in the absence, due to illness, of the Minister of National Health and Welfare I will have to take that question as notice. I hope that either the minister or I will be able to reply at the earliest opportunity.


ENVIRONMENTAL AFFAIRS
Mr. Bob Corbett (Fundy-Royal):: Mr. Speaker, my question is for the Minister of the Environment. As the minister is aware, environmental hearings are proceeding on the Pittson application to build a refinery in Eastport, Maine, with the next hearing under the auspices of the U.S. environmental protection agency to be held in Boston on January 6 or 7. Can the minister advise the House if it is Canada's intention to have an observer present, and if the government has been in touch with the U.S. authorities or the Pittson group since he took office concerning Canada's objection to the Pittson project?


John Allen Fraser: Mr. Speaker, 1 can assure the hon. member that a Canadian observer will be present. I can also tell the House that in August I met with the environmental protection agency chief, the hon. Doug. Costle, and reiterated Canada's absolute and very strong objection to the project which the hon. member has raised.
November 21, 1979


INQUIRY OF THE MINISTRY
Hon. Romeo LeBlanc (Westmorland-Kent):: Mr. Speaker, has the Secretary of State for External Affairs transmitted, in a formal note or in some kind of message to the U.S. government, the position of this government; and was that position made as clear and as strong as the note which was sent previously by the former secretary of state for external affairs?


Flora Isabel MacDonald: Mr. Speaker, I can tell the hon. member that the discussions have gone on at the verbal level, and it has not been in the form of a note.


COMMUNICATIONS
Hon. Jeanne Sauve (Laval-des-Rapides):: Mr. Speaker, my question is directed to the Minister of Communications. I should like to know if it is true that Teleglobe has been struck off the list of Crown corporations to be privatized only to be put on an alleged second list?


Hon. David MacDonald (Secretary of State and Minister of Communications):: Mr. Speaker, as the hon. member will know, during the process of the review of Crown corporations a number of them are being examined with respect to a more appropriate activity in the private sector. That is still the case in respect of this particular corporation.
[ Translation]


Jeanne Sauvé: I have a supplementary question, Mr. Speaker.
I find this answer totally unacceptable, in view of the rumours circulating about the possible purchase or sale of Teleglobe. The minister knows that the Canadian Telecommunications Carriers Association consider themselves as privileged purchasers. Therefore, to obstruct or encourage the efforts of the association, it is important that the minister make a decision or say clearly whether Teleglobe will be sold to private enterprise. The minister will understand my question when 1 remind him that the whole matter of competition in telecommunications remains, even if the CRTC has made a ruling on the systems interconnection. That decision emphasizes the urgency for the government to announce its policy about the amount of competition that is to be allowed. So the minister can see how this relates to the sale of Teleglobe-


Mr. Speaker:: Order, please.
Oral Questions


David Samuel Horne MacDonald: I do not think the hon. member, who knows this corporation particularly well, would want me to anticipate the outcome of any particular study. I think she knows the importance of this corporation serving a number of telecommunications interests on behalf of the people of Canada. When the study has been concluded and there are decisions to be announced, they will be announced in the usual way.


EXTERNAL AFFAIRS
Mr. Roland de Corneille (Eglinton-Lawrence):: Mr. Speaker, I address my question to the Prime Minister because 1 believe many members of the House are concerned, not only about the immediate problems facing us in Iran but about the religious and political problems that are inflaming the entire area.
I am concerned about two things, and perhaps the right hon. Prime Minister could comment on this. First of all, what is being done by Canada to protect these staffs, particularly the non-important personnel and people who are Canadians in these countries, such as Pakistan and Saudi Arabia and, for that matter, also Afghanistan where there are some problems? Also, what is being done in the way of emergency preparations for airlifting minority groups, such as the Baha'is, who have already been massacred in some numbers, and people of other groups such as various religious minorities in other areas? What is the Canadian government prepared to do to make it possible for these people to come to Canada or to find help?


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Mr. Speaker, I can reply in part to the hon. member's question. He or others in the House may wish to direct supplementary questions to the Secretary of State for External Affairs who has been handling this matter. In Pakistan, the Canadian ambassador has taken all the Canadian staff into his residence as a precautionary measure. We are given to understand that in Pakistan and in Saudi Arabia, Canadian citizens are at this time under no threat.


Roland de Corneille: Mr. Speaker, I am wondering about the care and concern for minority groups whose members are bound to be and are, in fact, refugees at the present time or potential refugees, such as the Baha'i faith people in Iran and others who might be persecuted.


Flora Isabel MacDonald: Mr. Speaker, I should like to mention two matters. One is with regard to the situation in Iran and in Pakistan, countries which the hon. member mentioned at the outset where there might be concern for Canadian personnel.

November 21, 1979
Oral Questions
Through our missions abroad, we have asked the governments of those countries to assure Canada that the International Code regarding the respect for the rights of embassy staff in these countries will be observed; that there will be no violation of it. We have tried to take precautionary measures in this regard, and we also have contingency plans for evacuation should that become necessary.
With regard to the second question respecting minority groups-the hon. member mentioned specifically the Baha'i group-we have not made any plans to try to evacuate or to bring here a specific group such as the Baha'is; and we have not, at the request of the central office of the Baha'i faith in Tehran, made any largely overt moves to try to direct attention toward them because of their fears that they might, as a result, be looked upon as some kind of group expressing the opinions of western countries and, as such, become more liable to persecution.


PENITENTIARIES
Mr. Yvon Pinard (Drummond):: Mr. Speaker, 1 have a question for the Solicitor General. Given the fact that all major construction projects in Quebec are at a standstill-that is the crude reality-and that these projects include at least three penitentiaries, could the Solicitor General explain to the House why he has put a stop to the construction of these three institutions and tell us what is happening indeed to the so-called penitentiary construction program in Canada?


Hon. Allan Lawrence (Solicitor General and Minister of Consumer and Corporate Affairs):: Mr. Speaker, first of all, I am not so sure that all public works in the province of Quebec have been suspended, or the construction of them. But in relation to the penitentiaries building program, when I arrived on the scene I was not convinced that the proper statistical base had been found respecting the forecasts of the future inmate population, not only in Quebec but across the whole country. A temporary freeze was put on the building program. We are about to lift parts of it, especially in relation to some parts of Quebec where I think it is quite essential that we get on with building some of the institutions.
[ Translation]


CONSTRUCTION OF INSTITUTIONS IN DRUMMONDVILLE AND MIRABEL-DATE OF RESUMPTION
Yvon Pinard: Mr. Speaker, given the fact that three weeks ago Correctional Service Commissioner Yeomans confirmed before the Standing Committee on Justice and Legal Affairs that in the last budget the government had

enough funds for the construction in Drummondville South and in Mirabel of institutions designed to replace the old Saint-Vincent-de-Paul institution; considering that the commissioner confirmed that the construction of a medium security penitentiary in Drummondville South and of a maximum security penitentiary in Mirabel was still one of the priorities of the Correctional Service of Canada; and finally in light of the fact that the Minister of Supply and Services, who is a member of the inner cabinet, announced the construction of these institutions in Drummondville last Saturday, can the Solicitor General confirm that the Minister of Supply and Services rendered was perfectly right and tell us at what specific date the work is expected to resume in Drummondville South and in Mirabel?


Allan Frederick Lawrence: Mr. Speaker, simply because funds are available to build these institutions does not necessarily mean that they should be built. I apologize if the hon. member did not understand me, but what I said was that I was not at all convinced that the statistical base was there- when 1 took over office-in respect of what institutions were required where and in what part of the country.
That doubt is beginning to be resolved by the emergence of a brand new set of statistics. Announcements have been made by the previous administration. As a matter of fact, I think there were four different, comprehensive total building programs announced over five years by the previous administration.


FREEZE ON CONSTRUCTION OF CERTAIN INSTITUTIONS
Mr. Maurice A. Dionne (Northumberland-Miramichi):: Mr. Speaker, my supplementary question is directed to the Solicitor General. Could he tell the House if the expected lift on the freeze of construction of penal institutions will apply to the proposed medium security institution in Dorchester and the maximum security institution in Renous?


Allan Frederick Lawrence: Mr. Speaker, as soon as a decision has been made, that decision will be announced.


NORTHERN AFFAIRS
Mr. Rod Murphy (Churchill):: My question, Mr. Speaker, is to the Minister of Indian Affairs and Northern Development. In light of the severe difficulties that the Manitoba Indian Brotherhood finds itself in at the present time, and in view of the fact that the federal department has cut off funding to the organization, with the result that staff members are losing their jobs and the organization cannot operate at the present time, will the minister immediately reinstate funding to the
November 21, 1979

Manitoba Indian Brotherhood in order that it can carry on its day to day duties while working out the problems it faces?


Hon. Jake Epp (Minister of Indian Affairs and Northern Development):: Mr. Speaker, in reply to that question 1 want to indicate to the hon. member that this funding not only relates to funding from the Department of Indian Affairs and Northern Development but also from the department of my colleague, the Secretary of State and Minister of Communications.
There is an audited deficit of some $440,000. There is also a loan which was guaranteed by my department of $250,000. The status of the situation at present is this. I met with some representatives of the Manitoba Indian Brotherhood late last night in Quebec City and indicated to them that we would want to have a complete audit of the operations of the MIB before money would be released. I had discussions with my cabinet colleague, the Secretary of State and Minister of Communications, this morning and we have agreed that until this has been done the money will not be released. In addition, a meeting of the chiefs in Manitoba has been called for the first days of December, at which time they will take action in terms of both the presidency and the executive members of MIB. Once they have done that and have given us a plan, we will move forward.


Rodney Edward Murphy: Mr. Speaker, my supplementary question is, of course, related to the fact that they cannot hold that chiefs' meeting in Winnipeg without funding. How does the minister expect the organization to bring chiefs in from all parts of Manitoba or plan that meeting without any funding?


Arthur Jacob (Jake) Epp: Mr. Speaker, I have to indicate to the hon. member that, while representatives of the MIB yesterday requested funding to be released in the order of $138,000, they did not make the point to me yesterday that the chiefs' meeting at the beginning of December could not go forward if that funding was not in their hands prior to December. What they did indicate to me was that there would be extreme difficulty for the 30 employees with MIB in terms of their future employment should that funding not come forward.


TRANSPORT
Mr. John McDermid (Brampton-Georgetown):: Mr. Speaker, my question is for the Minister of Transport. It was rumoured this morning in the Toronto Sun that the inquiry scheduled to begin in Mississauga on December 4, conducted by the Canadian Transport Commission, has been cancelled. Could the minister give us a status report on that hearing?


Hon. Don Mazankowski (Minister of Transport):: Mr. Speaker, as I indicated in the committee on transport and communications yesterday, it is the government's intention to proceed with a full and independent inquiry under the In-
Ora/ Questions
quiries Act. At the present time, officials of Transport Canada are meeting with representatives of the provincial government and the city of Mississauga to develop the terms of reference and the mechanism which would be best suited to looking into all aspects of the Mississauga incident.


VIA RAIL- RATES IN OTTAWA AND MONTREAL REGIONS
Mr. Marcel Roy (Laval):: Mr. Speaker, my question is to the Minister of Transport. Since November 19 last, VIA Rail has increased its fares substantially between Montreal, Coteau and Alexandria, and from Alexandria to Ottawa. When I say it has increased its return fares substantially, that represents an increase of 60 per cent over previous rates. Considering that a service improvement and car overhauling program coupled with a promotion program urging Canadians to use this public service initiated under the previous government were already giving encouraging results, how can he justify this attitude on the part of VIA Rail with respect to this increase that I find scandalous?


Donald Frank Mazankowski: Mr. Speaker, this government is, indeed, encouraging the revitalization of rail passenger services throughout Canada. We are examining all the service needs, not based simply on the matter of how much money we can spend but in terms of trying to rationalize the services so that the regional and local needs of the people will be met. I will certainly undertake to look into the matter of increased rates. 1 will discuss the matter with Mr. Roberts or the hon. member might be interested in appearing before the committee when Mr. Roberts will be there, at which time he can put the question directly to him.
[ Translation]


MONTREAL AND SUBURBS-FEDERAL-PROVINCIAL MEETING TO CONTINUE SERVICE
Hon. Francis Fox (Blainville-Deux-Montagnes):: Mr. Speaker, in late August or early September the minister met with his provincial counterpart to discuss commuter problems in the Montreal area. I would like to know whether the minister can confirm today that he still intends to conclude an agreement with his counterpart of the province of Quebec by the end of December to ensure the continuity of public transport between downtown Montreal and the city of Deux-Mon-tagnes as well as on other commuter lines on both the north and south shores of Montreal.


Donald Frank Mazankowski: Mr. Speaker, these discussions are going on at the officials' level. It would still be my hope that we would be able to reach an agreement by the end of December. As the hon. member knows, there has been a change in the membership of the

November 21, 1979
Oral Questions
portfolio of the ministry of transport. However, I want to assure the hon. member that the new Minister of Transport has indicated that he is very pleased with the progress of the discussions, and those discussions will continue and, hopefully, we will be able to reach a satisfactory resolution.


HEALTH AND WELFARE
Mrs. Ursula Appolloni (York South-Weston):: Mr. Speaker, 1 intended to put my question to the Minister of National Health and Welfare or, in his absence, to the Prime Minister. In his absence, perhaps 1 could refer it to the Acting Prime Minister. I have before me research reports which reveal that human fetuses from ten to 25 weeks gestation were victims of vivisection in the Winnipeg Health Sciences Centre for purposes of scientific experimentation.
Following hysterotomy, a method of abortion which removes a living baby, the infants were subjected to heart puncture and dissection to remove various glands, including the adrenals, ovaries, testes and pituitary. Can the Acting Prime Minister tell the House whether or not such experiments are still being funded by the Medical Research Council of Canada?
Hon. David MacDonald (Acting Minister of National
Health and Welfare): Mr. Speaker, speaking for the Minister of National Health and Welfare, who unfortunately is sick today, I am told that the facts as stated by the hon. member are not totally accurate, that the investigation or clinical study was carried on with respect to fetuses that were already dead at the time of the study. They were the result of abortions that apparently had been approved by the therapeutic abortion committee of the hospital. There has been a rather extensive preliminary investigation of the ethical qestions involved. I suppose that this arises out of the form of the question put by the hon. member, but perhaps most important of all I understand that these particular studies were carried on in 1976.


Ursula Appolloni: Mr. Speaker, I gather that it is presently being reviewed by the attorney general of Manitoba. The information 1 have is that the babies were indeed very much alive and, indeed, it could have been the procedures which these babies had to undergo that were the direct cause of their death.
In view of the possible criminal implications, therefore, can the minister tell me whether the Prime Minister's office is in touch with the attorney general of Manitoba to find out, indeed, what are the real facts?


David Samuel Horne MacDonald: Mr. Speaker, I am sure that the Department of National Health and Welfare and the minister will be most anxious to clear up any misunderstanding that exists with respect to these studies. I understand from the information that I have been given from the department that

there was very extensive consideration given to all the implications of this matter and that no operations were performed on any live human material. 1 think it is very important that that be understood. This experiment was conducted on human material that was no longer living, and it was the result of officially approved therapeutic abortions that were in no way related to the use of the material for clinical study. I am told as well that the study took place between 1972 and 1976.
Because the hon. member has raised this question and because there are questions that have been expressed publicly about the ethics, human disrespect and degradation, I think it is important that there be a full exposition on the facts of this matter. I can assure the hon. member and all hon. members that there will be a very clear statement on this matter.

[ Translation]


EXTERNAL AFFAIRS
Mr. Louis Duclos (Montmorency):: Mr. Speaker, my question is to the Secretary of State for External Affairs. In view of the fact that on at least three occasions the U.S. State Department had received assurances from the government of Iran that the U.S. diplomatic staff had nothing to fear if the Shah were hospitalized in the United States, could the minister tell the House how much faith she has in the word of the Iranian authorities as to the security of the Canadian diplomatic staff in Tehran?


Flora Isabel MacDonald: Mr. Speaker, I cannot, of course, give final assurance to the hon. member that the word of any person acting in Iran today can be taken as being the ultimate or final word on any subject. I do know that on the occasions where we have asked for assurances we have been told both by the authorities in Iran and by the charge d'affaires of the Iranian embassy here in Ottawa that Canadian nationals who are either attached to the embassy in Iran or living in Iran are in no danger. There has been no indication of any harassment or any threat to those people at any point in this very grave situation that exists throughout the country of Iran.


INQUIRY WHY MINISTER DOES NOT RECALL IMMEDIATELY CANADIAN DIPLOMATIC STAFF IN TEHRAN
Louis Duclos: Mr. Speaker, I have a supplementary. Since the usual rules as defined under international law do not seem to guide or do not guide in any way the conduct of Iranian authorities in the circumstances why does the minister not simply order the immediate recall to Canada of our diplomatic staff in Tehran?
November 21, 1979


Flora Isabel MacDonald: Mr. Speaker, that question was posed earlier today to the Prime Minister. I want to reiterate to the hon. member that there are responsibilities which our diplomatic staff must carry on in a situation, even one as grave and one which we dislike as much as this particular situation. There are Canadians living in Iran who might want to leave or who would need the services of our embassy at any time. There are services which we are offering to American nationals who are there without any kind of embassy services of their own. There are, of course, reasons for our being on the ground in Iran where we might help to resolve this situation, which we could not do if we were not present.


SHIPBUILDING
Mr. John Rodriguez (Nickel Belt):: Mr. Speaker, my question is for the Minister of State (Transport). In view of the fact that Canadian National at this moment is considering bids for the construction of a ferry to be used on the Canadian east coast, and in view of the fact that the Canadian shipyard industry in Quebec is now in serious trouble, having already laid off some 1,000 workers with another 600 to 800 workers facing lay-off, is the minister prepared to do his utmost on behalf of the Government of Canada to persuade CN to award the ferry boat contract to a Quebec shipyard?


Hon. J. Robert Howie (Minister of State (Transport)):: Mr. Speaker, I thank the hon. member for his representations, and I will bring them to the attention of the president of CN Marine.


John R. Rodriguez: A supplementary question, Mr. Speaker.


Some hon. Members:: Oh, oh!


John Carnell Crosbie: Slow down, tiger.


Mr. Speaker:: The hon. member for Nickel Belt.


John R. Rodriguez: Thank you, Mr. Speaker. I was not sure whether you would hear me. My supplementary question is to the Minister of Supply and Services. Is the minister prepared to contact CN Marine to impress upon them the need for this contract to be awarded to a Quebec shipyard, in order to keep that industry going in the province of Quebec?


Hon. Roch La Salle (Minister of Supply and Services):: Mr. Speaker, since my colleague emphasized the importance of the Quebec shipbuilding industry project, I want to assure the hon. member that I will do everything in my power to co-operate with all my colleagues in this House, in order that the Quebec
Order Paper Questions
shipbuilding industry may offer jobs, because the local people are in great need of it.


PRIVILEGE
Steve Eugene Paproski: Mr. Speaker, my question of privilege arises out of a question in Hansard on page 1492. 1 do not wish to deliberately mislead the House or the hon. member for York-Centre (Mr. Kaplan). There has been no cutback in the budget for ethnic press advertising. Moneys are frozen pending the results of a study commissioned by the Department of the Secretary of State to evaluate the effectiveness of advertising in the ethnic press and to determine the information needs of ethno-cultural groups in Canada. It is anticipated that decisions on future advertising programs can be taken within one month's time.



ROUTINE PROCEEDINGS


[Stage Direction]
First and second reports of Standing Committee on Veterans Affairs-Mr. Whittaker.

Hon. Walter Baker (for the Minister of Public Works) moved: the first reading of Bill S-10 (from the Senate), to confirm the authority of the Federal District Commission to have acquired certain lands.
Motion agreed to and bill read the first time.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated with an asterisk.)
Mr. David Kilgour (Parliamentary Secretary to President of Privy Council):: Mr. Speaker, the following questions will be answered today: Nos. 78, 105, 106, 111, 112, 200, 247, 296, 324, 388 and 437.

November 21, 1979
Order Paper Questions


Mr. Orlikow: 1.	Who (a) is the president (b) are the vice-presidents of the Seaway International Bridge Corporation Ltd.?
2.	What is the annual salary in each case?


J. Robert Howie: The Seaway International Bridge Corporation, Ltd., a subsidiary of the St. Lawrence Seaway Authority, advises as follows:
1.	(a) Paul D. Normandeau,
President,
The St. Lawrence Seaway Authority.
(b) David W. Oberlin,
Administrator,
Saint Lawrence Seaway Development Corporation, (U.S. state corporation).
2.	No salaries are paid to either officer for duties associated with the Seaway International Bridge Corporation Ltd.


Mr. Cossitt: 1.	Is the government aware of the condition of the washroom facilities in the building owned by the Ogdensburg Bridge Authority and occupied by Canada Customs and Immigration at the International Bridge at Prescott, Ontario and (a) if so (i) have the floor tiles in one of the washrooms been smashed, dug up and disposed of in large patches over a period of two years (ii) has one particular light fixture been out of operation for over a year (iii) has one of the two urinals in the men's washroom been out of order for many months (b) if not, was an investigation undertaken with a view to rectifying the situation and, if so, for what reason?
2.	Were representations made to the landlord to have these intolerable conditions rectified and, if so, what were such representations?


Walter David Baker: 1.	(a) The government is aware of the condition of the
washroom facilities in the building owned by the Ogdensburg Bridge Authority and occupied by Canada Customs and Immigration at the International Bridge at Prescott, and that (i) the floor tiles are missing due to water seepage and freezing (ii) the light fixture has been inoperative for over a year and has not been repaired (iii) one of the two urinals has been out of order due to the unavailability of parts, (b) N-A (See above).
2.	The government has made repeated verbal observations over the last two years to representatives of the authority which refuses to co-operate in maintaining this facility at a standard that we find acceptable. The authority maintains that they are keeping the facilities in the best condition possible with the funds available. We will continue our efforts to resolve these unsatisfactory conditions.
[Mr. Kilgour.l


EXTERNAL AFFAIRS-GIFTS
Mr. Cossitt: 1.	Did the former Prime Minister at any time give a gift of a boat paid for from public funds to Chancellor Helmut Schmidt of West Germany and, if so, what was the cost?
2.	Is the government aware that Chancellor Schmidt made a public statement in an interview that he had not sold the boat but found it necessary to leave it tied up at a dock because it would not float properly in rough water?
3.	Was the boat made in Canada and (a) if so (i) by whom (ii) on what date (b) if not (i) by whom was it made and on what date (ii) what are the reasons that the former Prime Minister gave the chancellor a foreign-made product rather than buying Canadian?
4.	What is an exact description of the boat including type, size, etc.?


Flora Isabel MacDonald: In so far as the Department of External Affairs is concerned the reply is as follows:
1.	Yes. It is not customary to disclose the cost of such gifts.
2.	Chancellor Schmidt's office has denied that the chancellor has made such a statement and has confirmed that he still had the sailboat; while it was true that the chancellor had found it a bit difficult to handle, because it is very fast, he had sailed it with pleasure and would continue to do so.
3.	Yes; (a) (i) Les Voiliers Performance Inc., 530 Delmar Road, Pointe Claire (Quebec); (ii) June, 1978. (b) Not applicable.
4.	Thirteen feet, ten and one half inches long, four feet, six inches wide; 125 pounds fiberglass "Laser" sailing dinghy.


MR. LEV VINOGRADOV
Mr. Cossitt: 1.	With reference to the answer to Question No. 16 of the Fourth Session of the Thirtieth Parliament, is the government aware of the full name of the wife of the Russian Professor Lev Vinogradov listed on page 6 as attending the Economic Department of Queen's University in Kingston, Ontario and, if so, what is her full name?
2.	(a) Was he accompanied to Canada by his wife (b) what were the dates that either he or his wife were in Canada?
3.	What were all the qualifications of Mr. Vinogradov that made him eligible for such an exchange with Canada?


Flora Isabel MacDonald: 1.	No.
2.	(a) No;
(b) Mr. Vinogradov arrived in September 1977 and left in February 1978.
3.	Mr. Vinogradov came to Canada under the terms of Section I (D) 1 of the Program of Scientific, Academic and Cultural Exchanges and Co-operation between Canada and the U.S.S.R. in accordance with the Canada-U.S.S.R. General Exchanges Agreement of October 20, 1971. He was nominated to the program by the U.S.S.R. ministry of higher and specialized education.
November 21, 1979


RUSSIAN PROFESSORS
Mr. Cossitt: With reference to the answer to Question No. 16 of the Fourth Session of the Thirtieth Parliament, were investigations carried out when visas were applied for by Russian professors and, if so (a) by whom (b) were there any applicants who were turned down and, if so (i) what were their names, fields of study, etc. (ii) in each case, what was the reason for the refusal (iii) how many were refused on the grounds that they were in any way suspected of being connected with, representative of, or in any way having dealings with any branches of Soviet Intelligence?


Flora Isabel MacDonald: Yes (a) RCMP Security Services; (b) No. (i) N.A. (ii) N.A. (iii) N.A.


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


Flora Isabel MacDonald: The number of employees on External Affairs' payroll on March 31, 1979 was as follows:
(a)	permanent	5,053(b)	term	91Total	5,144


CANADIAN ARMED FORCES-AIRCRAFT
Mr. Roy (Beauce): Has the government chosen which aircraft it will buy for the Canadian armed forces and, if so (a) will it be the F-I4, F-16 or F-18 (b) does the government's choice correspond to that made by the Canadian Armed Forces?


Hon. Allan B. McKinnon (Minister of National Defence and Minister of Veterans Affairs):: (a) and (b) It is expected the final selection of a new fighter aircraft for the Canadian forces will be considered by cabinet before the end of the current year. The finalists are the General Dynamics CF-16 and the McDonnell Douglas CF-18. The Grumman F-14 is not being considered.


UNITED NATIONS
Mr. Herbert: 1.	What amount was contributed last year by Canada to the regular budget ot the United Nations?
2.	What amount was contributed (a) to each of the eleven specialized agencies (b) for any other purpose?


Flora Isabel MacDonald: Canada's contributions in the 1978-79 Fiscal Year ($000 Canadian).
1.	U.N. Regular Budget	17,171
2.	(a) Specialized Agencies and IAEA
Order Paper Questions
ILO	4,349
FAO	4,640
WHO	6,574
UNESCO	5,198
ICAO	661
IMCO	60
ITU	1,639
WMO	426
UPU	480
WIPO	86
IAEA	2,431
GATT	1,249
Peacekeeping	
UNEF-UNDOF	2,782
UNIFIL	3,682
Social and Economic Programs	
UNDP	39,000
UNHCR	1,000
UNICEF	7,500
UNRWA	5,150
UNITAR	80
UNEPTSA	275
WFP	95,000
UNFPA	7,000
Committee on Racial Discrimination	5
Trust Fund for South Africa	20
Fund for Drug Abuse Control	100
Voluntary Fund for Environment	1,109


LOTO CANADA
Mr. Dick: 1.	Did Loto Canada, the government, any subsidiary or agent of either in its employ, contact General Instruments regarding the prospects of entering into a contract with them to provide a computer lottery gaming system to Loto Canada and, if so, on what date?
2.	Was such a contract finalized and, if so, on what date?
3.	What are the names, classifications and departmental sections of all employees who were involved in the negotiation of the contract?
4.	Were employees of an agency other than Loto Canada involved in the negotiation of such a contract with General Instruments and, if so, who requested their assistance and on what date?
5.	Was the contract sole-sourced to General Instruments without any calls for public tender and, if so, on whose recommendation?
6.	(a) What was the dollar value of the contract between Loto Canada and General Instruments (b) was there any clause allowing for an option to increase the size of the initial contract and, if so, what would be the dollar value of the contract if such option were exercised?
7.	Did any employee of Loto Canada, the government, any agency, subsidiary or agent in its employ, contact Canadian manufacturers of computer equipment regarding their ability to provide a similar type of computer lottery gaming system as General Instruments and, if so, which manufacturers were contacted and on what dates?
8.	On what date did the government or Loto Canada first learn that Consolidated Computer Incorporated, owned 53 per cent by the government, was in a position with Digital Computers to provide a similar type of lottery system as provided for in the Loto Canada contract with General Instruments?
9.	Did General Instruments commit itself in the contract with Loto Canada to manufacture, in Canada, any of the equipment necessary for the lottery system and, if so, what was to be manufactured in Canada?

November 21, 1979
Order Paper Questions
10.	Did General Instruments commit itself in the contract to transfer any expertise or technology to Canada to be used in manufacturing the lottery system as a basis for making future sales to other potential customers from this Canadian base?
11.	On what date did Loto Canada, the government or any subsidiary in its employ first become aware that the province of Ontario and/or the province of Quebec had asked Canadian computer manufacturers to submit proposals for the manufacture of a computer lottery gaming system for use by them?
12.	Prior to the signing of the contract between Loto Canada and General Instruments, was the government or Loto Canada aware that the province of Ontario and/or the province of Quebec had held meetings of all interested and potential suppliers of a similar lottery system for use by the provinces at the conferences held on June 5, 1978 in Toronto and on June 6, 1978 in Montreal?
13.	Did Loto Canada, the government or any subsidiary or agency in its employ take into account or know that the provinces of Ontario and Quebec had made requests for proposals on May 12, 1978 to Canadian manufacturers who could potentially produce or might wish to produce a computer lottery gaming system?
14.	Did Loto Canada award the Computer Communications Group, a part of the Trans-Canada Telephone System, a contract to provide data transmission facilities for its lottery system and, if so (a) on what date (b) what was the dollar value of the contract (c) was there any invitation to lender for the contract and, if so, was CN-CP Telecommunications contacted?
15.	Does Loto Canada appear on the schedule of Crown corporations listed under the Financial Administration Act as being exempt from requiring Treasury Board approval for any contracts it might enter into and, if so, on what effective date was it added?


Steve Eugene Paproski: 1.	Yes, Loto Canada conducted several extensive discussions with General Instruments Corporation during the period mid-April, 1978 to mid-June 1978, with the view to possibly acquiring the equipment and associated servicing for such a game.
2.	A contract to this effect was signed June 14, 1978.
3 and 4. Those directly involved were:
(a)	Guy Cousineau, President, Loto Canada Inc.
(b)	J. Fulton, Vice-President, Loto Canada Inc.
(c)	Gilbert Miville-Deschenes, Solicitor, Department of Justice, attached to Loto Canada Inc.
(d)	Jacques Gauthier, Solicitor, Department of Justice, attached to DSS.
(e)	R. P. Manley, Section Head, Data Processing (Procurement) Branch, DSS.
(f)	G. Gauvreau, Program Officer, DSS.
(g)	P. Kelley, Consultant, Peat, Marwick & Associates
(h)	R. Olivier, Consultant, Oliver & Ouellet Inc.
(i)	R. Auger, Consultant, Samson, Belair & Associes.
The D.S.S. employees were asked to assist by Loto
Canada on 15 April, 1978. The consultants had been
involved previously in associated tasks.
5.	A sole source contract was let with General Instruments of Canada, based on recommendations, judged valid by Loto Canada from outside independent consultants (Peat, Marwick & Associates; Olivier & Ouellet Ltee.; Samson, Belair & Associes) that the G.I.C. system was the only one capable of

meeting Loto Canada's requirements, including the time constraint.
6.	(a) The full lease value of the G.I.C. contract, over a
period of three years, could not exceed $47,930,439. (In addition, buy-out provisions were available as discussed in answer 325-1).
(b) No.
7.	No direct contacts were made. Loto Canada consultants investigated the capability of all those Canadian firms which could realistically be expected to have a possible capacity of supplying a system which would meet Loto's requirement on the basis of all available literature and personal research on public gaming.
8.	Consolidated Computers Inc. indicated in a letter dated June 16, that it had an interest in manufacturing such equipment; however, Loto Canada's consultants were not confident that it could meet the full system requirements-in particular, the time schedule aspects.
9.	GIC committed itself to an expenditure within Canada for servicing and maintenance of about $24,300,000 over the three years of the lease contract which represents 51 per cent of the entire contract value. It also undertook to assemble in Canada an additional 2,000 terminals whose possible order (but under competitive bids) was under active discussion, in which discussion IT&C. officials participated.
10.	Not in the contract; but as just noted, this was understood to be a condition for future orders. Moreover, Loto Canada had the option to take over the full servicing and maintenance aspects after the first year of operation.
11.	On 12 May, 1978, at the time of the announcement, by those lottery corporations.
12.	Yes.
13.	Yes.
14.	Yes, on 2 June, 1978. The commitment value was $2,391,695. CN-CP Telecommunications were asked to bid on this contract.
1 5. Yes, as of 1 August, 1976.


NATIONAL DEFENCE-EXPENDITURES
Mr. Allard: What was the total amount spent for military purposes in Canada in each of the past five fiscal years?


Allan Bruce McKinnon: Department of National Defence Expenditures in Canada for the fiscal years indicated were as follows:
Fiscal Year
1974-	75
1975-	76
1976-	77
1977-	78
Expenditures (thousands of dollars) 2,265,732 2,664,704 2,979,301 3,250,087
November 21, 1979

1978-79	3,437,356
Note: The above figures	include statutory expenditures
charged to National Defence	appropriations for public service
employee benefit plans, military pensions, pensioners contributions and other benefits and they were as follows for the year	
in question:	
Fiscal Year	Expenditures (thousands of dollars)
1974-75	349,332
1975-76	412,008
1976-77	422,286
1977-78	434,645
1978-79	356,953


EXTERNAL AFFAIRS-PASSPORTS
Mr. Cossitt: 1.	Docs the Department of External Affairs, when issuing passports, stamp thereon the following words "Not valid for travel to North Korea, Rhodesia, Namibia and Taiwan" and, if so (a) on what date was this instituted (b) what are the names of all the persons having a part in such a decision?
2.	Is travel to the Soviet Block countries of Eastern Europe permitted and, if so, for what reason is travel to North Korea not permitted?
3.	Is it possible to travel to Chile and, if so, for what reason is it not possible to travel to Rhodesia?
4.	Will the government review the policy of restricting the freedom of Canadians and cease forthwith, from stamping such restrictions on Canadian passports as well as withdrawing them from existing passports?


Flora Isabel MacDonald: 1.	The Department of External Affairs when issuing ordinary passports does not stamp in them the words "Not valid for travel to North Korea, Rhodesia, Namibia and Taiwan". This stamp is placed in special and diplomatic passports only.
(a)	The stamping of diplomatic and special passports was instituted on February 17, 1976.
(b)	The decision was made by the Department of External Affairs under the Passport Regulations Charge of April 21, 1973, and was subsequently confirmed by the then Secretary of State for External Affairs.
2.	The Department of External Affairs does not prohibit travel to any country. The Department does, however, place a restriction on the use of diplomatic and special passports for travel to North Korea, Rhodesia, Namibia and Taiwan. The reason for this policy is that travel on official passports is not appropriate to entities whose governments Canada does not recognize and with which it has no diplomatic relations.
3.	It is possible to travel to Chile and Rhodesia on ordinary passports. Diplomatic and special passports are not valid for travel to Rhodesia, as in accordance with mandatory United Nations sanctions Canada does not recognize Rhodesia and has no diplomatic relations in Rhodesia.
4.	As stated, the government has not restricted the freedom of Canadians to travel since ordinary passports are made valid for travel to all countries.
Order Paper Questions


QUESTIONS PASSED AS ORDERS FOR RETURNS
David Kilgour: Mr. Speaker, if questions No. 325 and 326 could be passed as orders for returns, those returns would be tabled immediately.
I ask, Mr. Speaker, that the remaining questions be allowed to stand.


LOTO CANADA
Mr. Dick: 1.	Did Loto Canada, under the contract with General Instruments for the provision of a computer lottery gaming system (or Loto Select), purchase any of the terminals, computers or data processing equipment and, if not, was such equipment leased or rented and, if so (a) what were the terms and length of time of the lease (b) did Loto Canada retain the right to sublease or dispose of the equipment in a beneficial way?
2.	Was there any provision in the contract specifying that persons employed to (a) instal (b) operate (c) maintain the equipment would be Canadian or U.S. citizens?
3.	Prior to Loto Canada's decision to develop a computer lottery gaming system, did it hire any consulting firms or individuals to examine the operations of other similar lottery games and, if so (a) what were their names and where were they located (b) how much were they paid?
4.	Did any agent or consultant acting on behalf of Loto Canada or any employee of Loto Canada visit any other jurisdictions to examine the operations of other similar computer lottery gaming systems and, if so (a) what are their names (b) what jurisdictions did they visit (c) what was the total cost of expenses paid by Loto Canada for such visits?
5.	Did the initial contract call for the installation of 2,000 computer terminals throughout Canada and, if so, by what date?
6.	Did all terminals have to be installed and in operation by that date and, if not, was there an additional date?
7.	Did the contract include the supply of three central computers to be installed in Canada and, if so (a) in which cities (b) were they built specifically for use in Loto Select or were they off-the-shelf equipment supplied by General Instruments?
8.	Did Loto Canada, in preparation for entering into its computer lottery gaming system (or Loto Select), enter into any other contracts with other persons, partnerships or companies in Canada or United States for the purchase, lease or rental of consulting services, furniture, office space, leasehold improvements, advertising, promotional materials, tickets, printed literature, office supplies, display boards or any other product, article or service and, if so (a) what are the names and locations of such persons, partnerships or companies (b)

November 21, 1979
Order Paper Questions
what was the total dollar value of each contract and what was the actual amount paid (c) in each case, did Loto Canada purchase, lease or rent, and if leased or rented, what were the terms and length of the lease or rental (d) did Loto Canada use the service or advice of any government department, agency, subsidiary or agent in its employ for negotiation of any of the contracts and, if so, for which contracts (e) in each case, was the contract finalized by a negotiated settlement and, if not, for what length of time will the contract run?
9.	Did Loto Canada in preparation for its lottery system (or Loto Select), hire employees for the servicing, maintenance, operation and administration of the lottery game and, if so (a) how many and in what classifications (b) on what date (c) at what annual rates of pay (d) in which cities were they to be located?
10.	Was Loto Select Loto Canada's first experience with operating a computer lottery gaming system and, if so, how did Loto Canada determine the rate of pay of each classification group to be employed by Loto Select?
11.	Did Loto Canada pay for the training of its employees for Loto Select over and above their regular salaries and, if so (a) in what locations were they trained and on what dates (b) what expenses were paid for hotel accommodations, meals, transportation, entertainment, telecommunications with their home centre and other services?
12.	Did Loto Canada in preparation for its entry into a computer lottery gaming system (or Loto Select), enter into any contract with telecommunications networks between (a) cities in Canada (b) Canada and any other country and, if so, between which cities and/or countries and at what cost?
Return tabled.

Question No. 326-Mr. Dick:
1.	Was a decision made by Loto Canada to remove itself from a computer lottery gaming system (or Loto Select) and, if so (a) on what date (b) who made the decision?
2.	Were employees hired for Loto Select or by any companies under Loto Canada's direct control laid off by Loto Canada after the decision to remove itself from the computer lottery and, if so, how many and on what dates?
3.	(a) By category or classification, what amount in salaries did Loto Canada pay to employees hired for the servicing, maintenance, operation and administration of Loto Select (b) how many received severance pay and what was the total amount?
4.	Was a dismissed or laid-off employee of Loto Select required to sign any agreement or oath of secrecy that he/she would not divulge, discuss or disclose any information that he/she had acquired regarding Loto Select while in the employ of Loto Canada or of any company under its direction or control in order to collect his/her severance pay?
5.	Prior to the decision by Loto Canada to remove itself from a computer lottery gaming system (or Loto Select), did
[Mr. Dick.)
the cabinet pass orders in council which in any way affected or touched upon any of the contracts or employees of Loto Canada involved or relating to its entrance into or removal from the lottery system and, if so, which ones were passed and on what dates?
6.	Were there any clauses in the contract with General Instruments for the provision of a computer lottery gaming system (or Loto Select), stating a dollar figure for penalty or liquidated damages if Loto Canada were to back out of the contract and, if so, what were the terms of the clauses and the dollar figure?
7.	Were there any clauses in the contract with General Instruments for the provision of equipment for a computer lottery gaming system (or Loto Select), stating a dollar figure for penalty or liquidated damages if General Instruments was unable to deliver the equipment contracted for by the date agreed on and, if so, what were the terms of the clauses and the dollar figure?
8.	Did it become apparent to Loto Canada, the government or any subsidiary or agent in its employ, that General Instruments would be unable to meet the contracted date of delivery of equipment, terminals and computers for use in Loto Select?
9.	Did Loto Canada, the government or any subsidiary or agent in its employ take into account or know that Consolidated Computer Incorporated and Digital Computers would be able to deliver equipment, terminals and computers prior to the date of delivery in its contract with the province of Ontario for a computer lottery gaming system and, if so, on what date was this taken into account or was such information known?
10.	Did Loto Canada or the government in return for removing itself from a computer lottery gaming system, reach an agreement with the province of (a) Ontario (b) Quebec for the province to pay $500,000 towards costs incurred by Loto Canada in extricating itself from its commitments other than the General Instruments contract?
11.	Did the province of Ontario and/or the province of Quebec receive, free of any further charge, any of the consulting services, furniture, office space, leasehold improvements, advertising, promotional materials, tickets or information pamphlets, display boards, or any other product, article or service acquired by Loto Canada for use in Loto Select in return for their commitment to contribute $500,000 each towards costs incurred by Loto Canada in extricating itself from contracts other than the General Instruments contract?
12.	Did any other province contribute funds toward the costs incurred by Loto Canada in extricating itself from its contracts related to Loto Select and, if so, which provinces and what was their contribution?
13.	Did Loto Canada, the government or any subsidiary, department or agent in their employ or on their behalf, enter into negotiations with General Instruments to extricate Loto Canada from its contract with General Instruments and, if so, on what date?
14.	Did Loto Canada resolve and finalize its contract with General Instruments and, if so, on what date?
November 21, 1979

15.	Did Loto Canada pay General Instruments to remove itself from its contract for computers, terminals, programs and other equipment for use in Loto Select and, if so, in what amount?
16.	Were meetings held between Loto Canada or the government and General Instruments to resolve the dissolution-ment of the contract between Loto Canada and General Instruments and, if so (a) in which cities and on what dates (b) what individuals were negotiating on behalf of Loto Canada at each meeting (c) what were the expenses paid by Loto Canada in travel, hotel accommodation, meals and any additional expenses for its negotiators?
17.	Did Loto Canada or the government employ any person, partnership or company to negotiate on behalf of Loto Canada with General Instruments and, if so (a) what are the names of those employed and on what date did they join the negotiations (b) what fee did they receive?
18.	Did Loto Canada dispose of any articles, goods, products or services it acquired for use in the Loto Select game through selling them to Crown Assets Disposal Corporation and, if so (a) what were they (b) what was the original cost to Loto Canada of each item (c) for each item, what was the disposal price received by Loto Canada from the corporation (d) has the Corporation sold any of them and, if so, at what price?
19.	Are any of the leases entered into by Loto Canada as part of its preparation to set up a computer lottery gaming system (or Loto Select) still continuing and, if so (a) what are the rental charges for all properties, services or products under lease (b) is Loto Canada in the process of finalizing all such lease agreements?
20.	Was Loto Canada or the government, before it entered into a contract with General Instruments, aware that General Instruments or its subsidiaries was forced into a position of renegotiating its computer lottery contract with the State of Maryland Lottery Corporation because of excessive profits for servicing the operation of the Maryland State Lottery?
Return tabled.
-MO)


Mr. Speaker:: The questions enumerated by the parliamentary secretary have been answered. Is it the pleasure of the House that the two questions, No. 325 and No. 326, be deemed to have been made orders for return if the returns are tabled forthwith?


Some hon. Members:: Agreed.


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


Some hon. Members:: Agreed.
Motions for Papers
[ Translation]


MOTIONS FOR PAPERS
David Kilgour: Mr. Speaker, notice of motion No. 20 for the production of papers is acceptable to the government, subject to the usual reservations concerning confidential documents and the authorization of the government authorities concerned.
I ask, Mr. Speaker, that the other notices of motions for production of documents be allowed to stand.


STE. ANNE DE BELLEVUE, QUEBEC-RELOCATION OF FISHERIES RESEARCH STATION
[Stage Direction]
Motion No. 20-Mr. Herbert:
That an Order of the House do issue for copies of all minutes of meetings, documents, telegrams and letters relating to the study of the relocation of the fisheries research station at Ste. Anne de Bellevue, Quebec.
Motion agreed to.
Mr. Speaker:: Shall the remaining notices of motions for the production of papers be allowed to stand?


Mr. Herbert:: Mr. Speaker, I rise on a point of order, of which I gave you notice. It may also be a question of privilege. I refer to the production of documents on October 31, when the Parliamentary Secretary to the President of the Privy Council (Mr. Kilgour) said that motion for the production of papers No. 29 was acceptable to the government. At page 811 of Hansard Your Honour put the motion and indicated it was deemed to have been adopted and the House agreed. A week later on, on November 7, I brought to the attention of the House that it had not been possible for me to have access to these documents. In fact, they had not been tabled, as I assumed they would have been, by the parliamentary secretary.
Following my interjection of November 7, the parliamentary secretary was kind enough to tell me that he had experienced some difficulty. The difficulty was that the material I had requested had been sent for translation.
My point of order is in two parts, Mr. Speaker. First of all, motion No. 29 reads as follows:
That an order of the House do issue for copies of all regulations and instructions dealing with the publication of tender calls in the Department of Public Works, including all references to the amount and form of deposits that may accompany such tenders.
I was somewhat amazed on November 7 to be told that such documents had to be translated. I did not inquire whether they were being translated from French into English or English into French.
At a later stage I may raise this point again, once I find out what the problem was in not having these documents, which should surely be in the public domain anyway, in both official languages. More important to me now, is that some three weeks later these documents still have not been tabled. I
1558

November 21, 1979
Motions for Papers
suggest that persons who have read Hansard and persons who have contacted me would assume the documents are in my possession.
Since the motion was passed by the House 1 would ask as a point of order whether it is not obligatory for the government under such circumstances, where there was no reserve, to have tabled these documents within a reasonable period of time.
[ Translation]


David Kilgour: Mr. Speaker, my understanding is that documents may not be tabled unless translated. As 1 explained to the hon. member for Vaudreuil (Mr. Herbert), this is in the process of being done and will require a little more time. This is all I can say on the matter.


Yvon Pinard: Mr. Speaker, according to what the parliamentary secretary just said I realize that he should have waited until he had the documents translated before informing the House that he was going to table them. I think that the practice he should follow before saying he is ready to table documents related to a motion presented by a member would be to have the translation of the said documents on hand before making his statement.


David Kilgour: Mr. Speaker, can I suggest to my colleague from Drummond (Mr. Pinard) that he raise the matter with his colleague from Vaudreuil (Mr. Herbert)?
[English)


Mr. Speaker:: Order, please. The hon. member has raised by way of a point of order a matter which 1 am sure will be examined by the Parliamentary Secretary to the President of the Privy Council (Mr. Kilgour). I certainly hope so.
We have two kinds of situations here. One is that in which there would be an allegation that there has been delay on the part of the government in responding to the order of the House. That has not been suggested but I would want the parliamentary secretary to examine the causes for any delay so as to make sure there is no suggestion the government is delaying. That is only half the problem.
Once we have eliminated that-and, as I say, there is no allegation that there is any delay on the part of the government-then 1 and all hon. members would want to have some assurance that, if the House of Commons passes an order demanding the tabling of documents, that order will be complied with within a reasonable time. Again I say there is no allegation that it is the government that is flaunting the orders of Parliament, but I would want to be absolutely certain-and 1 would entrust this responsibility to the parliamentary secretary-that the public service, who might have responsibility in this regard, is giving proper respect and attention to the order of this House. I think all hon. members would want to be given some assurance in that regard.


David Kilgour: 1 would be very happy to look into that, Mr. Speaker.


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


Some hon. Members:: Agreed.



GOVERNMENT ORDERS

[Stage Direction]
[English\

[Stage Direction]
amendment™ provide tax credit in respect of

[Stage Direction]
The House resumed from Tuesday, November 20, consideration of the motion of the Minister of Finance (Mr. Crosbie) that Bill C-20, to amend the Income Tax Act to provide a tax credit in respect of mortgage interest and home owner property tax, be read the second time and referred to Committee of the Whole.
Mr. Bill Blaikie (Winnipeg-Birds Hill):: Mr. Speaker, yesterday in the first part of my speech I expressed this party's appreciation of the need which the mortgage tax credit legislation tries to meet; that is to say, the need of potential home owners and existing home owners to be better able to bear the costs of home ownership.
I went on to give some of our criticisms of this legislation as a tax policy, as an economic policy and as a housing policy. I noted that as a housing policy it overlooked the far greater need for action on the housing situation which is characteristic of the inner city areas in our major Canadian cities.
I also noted that as a housing policy addressed to the problem of the high cost of housing it missed the point of why house prices are so high in the first place. That is due to the incredible increase in the price of land which developed in the early 1970s, thanks to the developer monopolies which controlled most Canadian cities.
I was just about to speak on what 1 call the "unknown" in this legislation when we were called to the Senate to witness the royal assent of a bill. What I meant then and what I mean now by the unknown in this legislation is that we do not know where the money is going to come from. On this side of the budget which we expect on December 11, do we really know where the money that is necessary to finance the mortgage tax credit will come from? Given the envelope policy of this government and the government's lack of will to raise new amounts of revenue by considering ways in which more of the wealth created in this country might accrue to the public purse, we are faced with the situation in which we have to imagine just where the money will come from.
As we have said, we are in sympathy with the desire of any government to make life easier for those who are finding it difficult to realize one of their aspirations, in this case to own a
November 21, 1979

home. But trying to do this without at the same time considering ways in which we could increase the revenue of government instead of considering raiding other programs is unacceptable to us. I believe it is unacceptable to the Canadian people both on practical and on philosophical grounds.
it seems to me that mothers and families who lose income through adjustment in the family allowance program, changes to it or the elimination thereof, or through changes in the tax deductions for dependants, and then who may gain through this program, will not be fooled. They will know that in the long run, or in the short run for that matter, their situation is not improved significantly. Then there will be those who do have a net benefit from this legislation. In my opinion, they will not be happy either. They will not be happy to know that their benefit comes at the expense of other people because of the intention of this government to pay for this particular piece of legislation at the expense of other programs already in place.
1 suggest that the government, if it is intent on pursuing this proposal to the state of implementation, should start to get serious about the other side of the question of government spending, that is, government revenue. It should seek out ways in which more revenue can accrue to the Canadian public purse by getting a bigger share of the wealth which is created through the abundant resources of our country. In this way we will not always be in a position, as we have been of late, of having to choose between social programs because we mistakenly believe that we have reached the limit of economic capability to engage in various social programs.
I do not believe for one minute that we have reached that limit of our ability to innovate and to do new things. But I sense in the country, and particularly on the part of this government, a feeling that we have reached the limit of the funds available for social programs.
In my view this is a terrible premise on which to act as a government. 1 suggest to the government that it get serious, not just about restraint on ways to raise new money. We should not have to face the kinds of difficult decisions that we now mistakenly believe we have to face because we do not address the other side of the restraint argument, which is the raising of new moneys.


Mr. Blaine A. Thacker (Lethbridge-Foothills):: Mr. Speaker, 1 speak as a person committed to Bill C-20 which is before the House. I think that it is a good measure and should be passed.
As a new member of this House, I must say that for a number of days it was interesting to listen to members of the New Democratic Party and their rhetoric on various bills and motions before us. 1 now have no doubt that the purpose of members of the New Democratic Party and some members opposite in the loyal opposition is to filibuster this bill, or certainly to stall it. It has become boring to listen to the NDP rhetoric, it is true that certain people walk through life backwards opposing everything and having no creative ideas on the various matters before this House. This is a party that
Mortgage Tax Credit
lacks dynamic ideas and the ability to lead. It is not dealing with the real problems of the country. On all bills that we have faced to this point we have heard criticism with no alternatives. That applies whether the finance committee is dealing with high interest rates or whether it is this bill before us. How limited is the view of that party, with no real alternatives? It has a repertoire limited really to three phrases-"attack on profits'', "multinational corporations" and "rip-off'.
First let me deal with the phrase "attack on profits". Anyone who has been in business, certainly the small business community in this nation, understands that the word "profit" is simply gross revenues less the cost of producing that product and putting it on the market. We all know, except members of the NDP, that profit is necessary if plants are to be expanded and if new capital equipment is to be bought to fulfil future needs.
Next, with respect to multinationals, there is always an attack on multinationals whenever that word comes up in the Income Tax Act. It is only through the multinationals that highly complex and technical oil sands plants can be developed and highly technical machines can be produced. It is only through a multinational corporation that the money and the skills can be brought together in order to develop a huge project. It cannot be done by simple corporations or by proprietors. It certainly cannot be done by government. It is interesting that the NDP have made such vicious attacks on the multinational corporations when in fact the union pension plans and members of the unions hold thousands and millions of shares in those multinational firms.
Concerning rip-offs, I have heard these two words constantly used with never a stitch of evidence in support, and certainly no hard evidence.
It was gratifying to hear the hon. member for Winnipeg-Birds Hill (Mr. Blaikie) refer to revenue. He should have been concerned with revenue. Over the last ten years the Liberal-NDP love affair has driven this nation into a budgetary deficit of $11 billion each year, and into a current account deficit of $7 billion. That has to be laid directly at their feet; it is their responsibility.
What is their philosophy? Again, we are always faced with a great deal of hoo-haw and rudeness from their side of the House. If they were running the country they would not permit the same free expression that we permit here. Their philosophy is the philosophy of the ant hill, of the beehive, that everybody has to be reduced to the same, that there should not be a chance of opportunity for people to build and to grow in this country. Sir, they will always remain in their present position with that attitude.
With respect to this bill, the hon. member for Broadview-Greenwood (Mr. Rae) has argued that the bill will not help solve the problem of the inner cities. There is no doubt that the problem of the inner cities is great. This bill does have a provision in it that could go some substantial way toward helping that problem. Anyone in the inner city who wants to renovate their home can do so and deduct the interest on any mortgage against their income tax pursuant to this bill.

November 21, 1979
Mortgage Tax Credit
The NDP also argue that this bill applies to a special group.
I must agree with that. The group that this bill is designed to help are those 3.8 million people who own homes. I say to them, so what that a certain group has been set out? Every tax law, every tax deduction, every exemption applies to a certain group and not necessarily to everyone else. Certainly our old age security applies to a certain group. Would they turn that back because it is a privileged group?
The hard reality is that the home owners of this country are really the workers. They are the people who live next door to us, who work in the multinational corporations and run the small businesses. It is this group who have been carrying this country, and I have no hesitation at all in backing a bill that will give some status and some protection to this group.
It has been argued by several members opposite that this bill is of no benefit to renters. Obviously they have not been in the real world. In fact, it is a very real incentive for people to get out of their rented premises and buy homes. With the concepts of nationalization and universalism as promoted by the NDP, if they were in government each and every one of us would be renting our homes. We would not have that privilege of owning our home, a privilege for which thousands of our ancestors died.
The members of the NDP are always calling for universalism and nationalization. If they cannot have it their way, they say nationalize it. They would have us all return to the mid-1700s when there were serfs from which our ancestors escaped, many of them losing their lives.
Renters have cheaper costs of living than those who own a home. That is simply because the landlords can deduct the mortgage interest and taxes from their gross income. In actual fact, landlords do not make much money from the rent they receive. They make their money from the capital cost allowance and the capital gains that accrue on the property. The members of the NDP would deny them that. They would deny people the right to buy a home, deduct the interest and have capital gains.
It is also argued by members opposite that this measure has no social value. In actual fact, what could be of a higher social value than encouraging people to own their own homes? Anyone who has lived in a high-rise apartment knows there is no sense there of belonging to the community. However, when you own a home, have neighbours and neighbourhood skating rinks, you feel you belong.
With respect to the cries and wails of the Liberals, it is absolutely apparent and crystal clear that their only regret is that they did not think of this idea first. Their entire position can be dismissed with that simple statement.
The hon. member for Broadview-Greenwood in particular has argued that the government cannot have it both ways. In actual fact, the NDP are in the awful position of not having it both ways. They know that to retain their mere 17 per cent of the supporters they must always be yelling "profit", "rip-off', "multinational"! However, they also want more votes. They

want to form the government some day. In order to do that, they have to cozy up to small business, and that is where they cannot have it both ways. You cannot be yelling "corporate welfare bums", "nationalization", "universalism", and at the same time attack the small business community and home owners who carry this nation. They have to decide which way they are going to have it.
In summary, given the present state of our income tax law, which is incredibly complex and confused and needs a tremendous amount of work in order to rationalize it, given the system as it is at this time, given the present status of our national accounts and given the fact that the Liberal-NDP love affair of the past ten years has practically destroyed this nation, it is time we give a special status and special tax credits to the home owners of this nation. I therefore have no hesitation in backing this bill.


Mr. Donald J. Johnston (Saint-Henri-Westmount):: Mr. Speaker, I might say that I looked forward to getting into this debate today and in fact was ready to participate last night. It is with a somewhat heavy heart that I rise this afternoon due to today's events which have had a profound effect on all members on this side of the House and undoubtedly accounts for the fact that we do not have too many in their seats this afternoon.
That being said, I wish to refer briefly to some of the comments I have heard from across the chamber and from gentlemen on my left, and then demonstrate, I believe to the satisfaction of everyone present, that this bill is a monstrosity and a disaster.
I was quite impressed with the rhetoric of the Minister of Public Works (Mr. Nielsen). 1 had not had the opportunity of hearing the minister engage in debate in this House at any length. I realized in the course of his remarks that I had met on a number of occasions and admired for many years a brother of the Minister of Public Works, who is a renowned and quite able Canadian actor by the name of Leslie Nielsen. It is quite apparent after watching the minister's performance that his brother Leslie learned his trade at the knee of the master. I found that the remarks, which were both outrageous and filled with hyperbole, were delivered with a straight face, and that is surely a mark of great Thespian ability.
I listened to the hon. member for Broadview-Greenwood (Mr. Rae), as I frequently do because we seem to follow each other in these debates. I might say it was one of the first times during the course of this Parliament that I agreed with much of what he had to say in terms of criticizing the bill and describing the obvious housing need, which is an affordability problem and is particularly true in my area of Saint-Henri-Westmount.
I took exception to a number of his remarks, particularly when he seemed to confuse what he alleged to be a Liberal statement of social policy with one that is surely the cornerstone of his own, namely that Liberal social policy, he stated, can be described as "nothing for everybody".
November 21, 1979

As the hon. member for Lethbridge-Foothills (Mr. Thacker) just pointed out, that basically is fundamental to the NDP philosophy and is founded on the famous sum zero theory, a complete disbelief in the role of private capital and in the marriage of capital, resources and labour in the creation of economic growth.


Mr. Orlikow:: You are being ridiculous.


Donald James Johnston: You had your opportunity; I look forward to hearing you on another subject.
Moving from there, 1 almost felt like rising on a point of order when I heard members such as the last one, and a questioner in a question addressed to the Prime Minister (Mr. Clark) the other day, claiming that this was an original Tory idea. That statement is discredited on its face because the Tories, to my knowledge, have never had an original idea. This particular idea has been bandied about for years. The Tories are perhaps not as far behind as in the past-generations and decades-but they certainly are behind with respect to this idea.
in May, 1978, after having been nominated as a candidate for the Liberal party but prior to the byelection when 1 was elected in September, I examined this question of mortgage interest deductibility. 1 had actually been a promoter of the idea for some time. On May 15, 1978 I wrote to the then prime minister, now the Leader of the Opposition (Mr. Trudeau). 1 would like to read one passage from that letter. 1 quote:
Some tax relief must be provided to home owners who are now prohibited from deducting interest on loans obtained to acquire a home. The relief need not take the form of a deduction of interest but could take the form of a tax credit which the officials in the Department of Finance would regard as "progressive" inasmuch as it benefits the taxpayer with lesser income as compared to the taxpayer with greater income. A limit to the credit or to the amount deductible if that is the preferred technique could be etablished.
That letter was sent in May, 1978. I subsequently had discussions with members of my party and in caucus. When the present Prime Minister first released this idea to the Canadian public as mortgage interest deductibility in September, 1978, we had moved past that stage. Of course, the modification of which they are so proud, that it take the form of a tax credit, was only introduced this autumn. In this instance they are only a year and a half behind the Liberal party instead of a decade or a generation. 1 would point out that we on this side of the House, far from being ashamed of this idea, examined it from every point of view and rejected it, recognizing that it was socially not acceptable.
We recognized, too, that it was a bad economic instrument, that it was not fiscally neutral, and while it appeared to me, sitting in the private sector and trying to promote reform ideas, as being a vehicle which perhaps we should consider, upon examination we concluded it was not in the interests of the country to introduce a scheme of that kind.
We drew those conclusions from our own expertise and from the trip to Washington to which the hon. member for Broad-
Mortgage Tax Credit
view-Greenwood made reference. We did not have the benefit at that time of the study by the C. D. Howe Institute which condemned the plan, or of the study of the prestigious Institute for Policy Analysis of the University of Toronto, which condemned the plan, or by the Fraser Institute of Vancouver, which condemned the plan, or of various other studies and commentaries which have since been carried on by renowned economists across this country. We had the intelligence and the foresight to abandon this plan, having examined it, before it even occurred to the spirit of these gentlemen to make the modification they first made this autumn. So I object to being told that this is an original Tory idea.
First of all, mortgage interest deductibility is an old idea. As the Minister of Finance (Mr. Crosbie) has pointed out, it has existed in the United States since 1862. The idea of a tax credit is not new, either. All of these plans have been examined over the years and they have always been rejected on the grounds I have indicated, apart from the fact that it is fiscally irresponsible to consider any such plan at this time when the minister makes much of the deficit afflicting this country. Yet this is a plan which might have the effect of increasing it by 25 per cent.
You might ask, Mr. Speaker, having read the passage which 1 wrote to the then prime minister: What made you change your mind? What made me change my mind was a close examination of the impact of that package on our economy and on our society. As far as I am concerned, the plan is totally unacceptable. One might ask then: If it is totally unacceptable, why has it enjoyed so much popularity? We know that hon. members on the other side of the House attribute much of their election victory to this plan. What is at the root of its popularity? I have spoken in the House before on that subject and 1 do not want to belabour the point today, but it is perfectly clear there is a constituency in this country, one to which this plan appeals, which believes it is overtaxed.
As I have often stated, I share that view. I believe that middle and upper income groups in this country are bearing a disproportionate amount of the tax burden. But if that is the problem, let us face that problem and introduce meaningful fiscal reform rather than attempting to create a benefit for one particular interest group, namely, home owners. We want to achieve tax neutrality and a fair distribution of the tax load. This plan, as members have acknowledged, and as people across the country have acknowledged, has absolutely nothing to do with housing. It happens to be a tax plan which is of particular benefit to home owners. It does nothing for the housing industry and it is detrimental to the economy in almost every way one could imagine.
What do we need? Apart from the fiscal reform to which 1 made reference and for which 1 will continue to fight, what we need, essentially, is capital formation. There are capital requirements. Net investment has fallen-I am talking about investment in productive areas, not investment in residential construction. 1 was looking recently at some comments of Mr. Tony Boeck of the "Bank Credit Analyst" which he delivered to the Canadian Institute of Chartered Accountants, and he

November 21, 1979
Mortgage Tax Credit
points out that net investment, which is what gives an economy its growth, production and rising living standards, has fallen from around 13-14 per cent of the gross national product in 1965-66 to less than 8 per cent in recent years. Net investment has thus fallen from almost 50 per cent of government current spending to around 20 per cent.
It should not be our object to reward people who live in homes. What we want is to create a fiscal system which attracts capital into productive sectors. That is why 1 put my question to the Minister of Finance the other day asking him whether he was considering introducing some kind of tax credit to attract capital to the small business sector, where at the moment companies are labouring under high interest rates. They could use a project of that kind at any time, but particularly now when they are burdened with such high interest rates. The need facing us today is for capital in certain sectors of our economy, that is, in the productive sector.
But what about housing per se? The C. D. Howe Institute in a report which was published earlier this year asked the question: Does Canada have a housing problem? The Institute said:
While it has been in the interests of both private sector builders of housing and those in government responsible for public housing to create the impression that serious problems exist, housing statistics indicate that generally Canadians have become better housed than they were 20 or 30 years ago without increasing the proportion of their income spent on housing.
The quantity and quality of housing has constantly increased in this country, and as the hon. member for Broad-view-Greenwood pointed out, the housing picture here is roughly equivalent to that in the United States where there is mortgage deductibility as wel! as many other forms of interest deductibility. This being the case, surely we are targeting the wrong area. That area is not where the need lies.
Allow me, Mr. Speaker, to read into the record just two other comments from observers whom 1 regard as very objective. Again, one is Mr. Boeck from the "Bank Credit Analyst" who states as follows with respect to this specific scheme:
As for the government's scheme of mortgage interest and property tax deductibility, I think it is an absurd, inefficient way to cut taxes. It was solely a cynical election ploy to buy votes through creating a handout to that large special interest group-homeowners. On grounds of equity, there is now a tremendous clamour for renters to cut themselves through a tax break of their own.
People should not be given tax rebates based on how they spend their incomes. This only drives up the price of the items for which they arc being subsidized- houses and mortgage interest costs. Tax breaks should derive from working, producing, investing and saving. That is the fairest and most desirable in terms of accomplishing the nation's economic and financial objectives.
I would have thought those were objectives which hon. members on the other side would share. Apparently they are not.
More recently, an editorial which appeared in "Canadian Building" in October was brought to my attention. One might think they would have an interest in this program. The article has the following to say about it:
The mortgage interest deductibility scheme which raised such high expectations during the election campaign has become as explosive as other hastily improvised promises of that time such as the embassy move to Jerusalem and the privatiza-

tion of Petro-Canada. The reasons are the same. MID was a badly conceived idea proposed for the wrong reasons and introduced at the worst possible time. MID has been condemned by virtually every serious study. Benefits are limited and temporary, but the costs are massive and perpetual. It is a cumbersome, discriminatory and counter-productive allocation of capital resources. It will distort the tax structure, rental sector and money markets and it will increase house costs, interest rates, property taxes, inflation, individual debt and federal deficits.
I read that, Mr. Speaker, because we could not say it better ourselves.
Given all this information, given all these studies and given the fact that hon. members on this side of the House-like myself, for example-have repented and recognized that this was a bad plan since we first examined it, how is it that the Minister of Finance insists on putting this bill forward as being in the best interests of Canada and of Canadians, and how is it that he has so much support from his backbenchers, who are toeing the party line? I am not sure, but I suspect in the case of the Minister of Finance that there is an additional problem for him. I made a conversion, as 1 just described, from being a supporter of this plan to being a detractor of the plan.
As hon. members know, the Minister of Finance at one time was an outstanding member of the Liberal party in Newfoundland, and I suspect that underneath his flamboyant exterior there still lurks a somewhat Liberal personality. Perhaps he is being put to the loyalty test. Hon. members have probably seen those films in other instances in which somebody comes over to your side, but you want to make sure he is really on your side so you make him shoot one of the prisoners or poison a member of his family. Well, the Minister of Finance in this case is being called upon to put forward in this House this atrocious, regressive fiscal measure which he knows full well is not in the interest of anybody. In fact, as I read his speech, it becomes very apparent that he is unable to treat the matter seriously and wants to expedite its passage through the House as soon as possible.
1 am on record on this issue a number of times. My colleague from Winnipeg has pointed out many of the social problems associated with it. There are many other speakers who will bring their points of view to bear on this problem and who will demonstrate what a serious question this is. It is not a question of this debate being a filibuster. I say in all seriousness that 1 think this Conservative government is at the point of foisting a law upon our country which will have very long-term, serious, negative consequences.
I think 1 am in a unique position when I make that declaration, having proposed the idea before it came to the attention of hon. gentlemen opposite and having rejected it after serious examination. Hon. members opposite have had the opportunity for serious examination. I wish they would reject it themselves, but that does not appear to be the case because they are intent on trying to save what is left of their political credibility, if there is any.
November 21, 1979


Mr. Evans:: Not much.


Donald James Johnston: However, I urge one thing upon them. Something which crosses my mind as I stand here and as I flip through the Standing Orders of the House-it is not a technical legal question-is that I believe members of this chamber who themselves have mortgages and would benefit from this bill morally should not vote on this issue because they have a direct pecuniary and financial interest in the passage of this bill. I believe it is Standing Order 6, Mr. Speaker. 1 do not think it has been subject to a judicial interpretation, but it is a logical rule.
There is a moral message here. If one extends the application of that Standing Order, of course, one could deal with old age pensions and a series of other things; but here there is such a direct pecuniary interest-since members of this House who hold mortgages would benefit-that I think it would be most inappropriate for them to vote, and 1 am sure their abstention from voting would be much appreciated by the Canadian public.
With those brief comments I will conclude my remarks. I look forward to hearing interventions by hon. members on both sides of this House.

I am sure the hon. member for Laval (Mr. Roy) will follow suit, and doubtless he will describe many other negative aspects of this bill. On behalf of my electors, I can say that there is nothing in this bill that will ever benefit the electors of Saint-Henri who are tenants. In the city of Montreal, the vast majority of voters are renters, so there is little reason to induce me to vote for this bill.
In any event, Mr. Speaker, I appreciate the fact that you are now having a look at our Standing Orders. I should appreciate knowing what you think about the matter. So, I now give the floor to other hon. members.


Mr. Deputy Speaker:: I wonder if the hon. member was really raising a point of order and requesting the Chair to make a judgment. 1 will look into the matter. At first glance, if the Chair were to go as far as the hon. member seems to wish it to go, it might become a judge on many matters and subjects which are debated in this House, and it might prevent freedom of speech. At the same time, I have to protect freedom of speech.


Mr. Jake Froese (Niagara Falls):: Mr. Speaker, this is my first opportunity to speak in the House. I am very happy to participate in this debate.


Some hon. Members:: Hear, hear!


Jake Froese: I have not had the privilege of sitting in this House before, and I did not realize the important position and the confidence Your Honour has in this Parliament. I had a very good experience as I flew home on a plane some three weeks ago. You gave up your more comfortable or better seat
Mortgage Tax Credit
in the plane for a father and his two children. You moved to the back. I was very happy that I had the privilege of knowing you. You showed not only that you are a gentleman in the House but also that you are a great gentleman in your everyday life, which I truly appreciate.
1 come from the riding of Niagara Falls, which is made up of the city of Niagara Falls and the town of Niagara-on-the-Lake. Often in the time I lived in Niagara-on-the-Lake I wondered, if it were not for the war of 1812, whether the capital of Canada would still be Niagara-on-the-Lake and not here in Ottawa. I suppose that is something we really do not know.
History has been made in Niagara-on-the-Lake and, as we are talking about housing policy or something which will relate to reviving the housing industry in Canada, 1 cannot help but bring to the attention of this House the fact that in the riding of Niagara Falls the question of housing and its importance is not new. However, I want to draw to the attention of the House another factor regarding the area from which I come which is tremendously important to Canada. When I was the lord mayor of Niagara-on-the-Lake, I had the opportunity of having Mr. John Diefenbaker as a guest of honour to the town of Niagara-on-the-Lake. There was something he related to me which I did not know. In fact, I was surprised that historians who were very active in our area had not brought this to my attention sooner. Mr. Diefenbaker said that it was in the town of Niagara-on-the-Lake-it was Newark at the time-that freedom from slavery legislation was passed 42 years before any other country in the world abolished slavery. At the present time the town of Niagara-on-the-Lake has a population of only a little over 3,000. At that time it had a population of not much greater, but there were 1,300 black people living in Niagara-on-the-Lake who had fled across the border.
There is a very interesting thing which I would like to relate to the House and which seems just about impossible. In "Uncle Tom's Cabin" there is a story-which is true-relating to a Negro woman who escaped across the Niagara River by jumping blocks of ice with her child. She was running to freedom. I was not born in the area and did not go there until I was 15 years old, but many a time I stood at the bank of the river, looked across and thought about how impossible this was, until one year in the 1950s when the ice jammed up because of a northwest wind, and one could walk across the Niagara River by jumping from iceberg to iceberg. I take it that was the kind of winter it must have been when that Negro lady came across.
Niagara-on-the-Lake was built at the time when the United Empire Loyalists came to Canada from the United States. It became a place of refuge. The gentleman who was in charge of the armed forces in Upper Canada at that time was Colonel John Butler. He is not noted for his military activities but rather for providing housing and agricultural land for the survival of the United Empire Loyalists.

November 21, 1979
Mortgage Tax Credit
At that time my constituency played an important role in the history of Canada. The important parts of my riding were Queenston and Chippawa which now are at the heart of the city of Niagara Falls, a place which is not only known for the part it played in the history of this country but also for its beauty. God has given this universe a miraculous gift in the form of the Niagara Falls. Some of us Canadians take Niagara Falls for granted.
About a month ago I had the opportunity to be host to some gentlemen from the German Bundestag, and I thank the Senate for having given me this opportunity. These diplomats watched the water run over the Niagara Falls and asked, "Does it never stop running?" 1 have heard a few other people ask that question. When you look at the Niagara Falls you marvel at it and wonder where the water comes from that it never stops running. It is a truly magnificent sight. Not only is Niagara Falls important in that it is the honeymoon capital of the world, but its importance also lies in the fact that this was the area where the first electrical power in this country was generated, a fact which is important not only to the industry but one which has brought a tremendous change in our homes.
As i was listening to the proposal for this property tax and mortgage interest deduction, I heard it said from the opposition side that it will help only the elite of this country. I should like to inform the House that 50 per cent of my riding is made up of ethnic groups. I am very pleased to see, when I look at the statistics, that 75 percent of the Niagara Falls riding is made up of home owners and, what is still more important, that we are considered to be a low income area in Canada. In fact, you can buy a house in Niagara Falls for less than $40,000. The reason I mention this and the reason 1 spoke of the background of the population in my riding is that the people in my riding put tremendous importance on owning a home. It is the most prized possession of any Canadian, and that is evident from the income level in Niagara Falls and from the number of people who own homes in that area.
Let me tell hon. members why this is so important. Niagara Falls was first populated in the 1950s when the hydro canal was being built. People from different parts of the world arrived there because there was a job available in Niagara Falls for anyone who wanted to work. Those who came liked Niagara Falls and stayed there. Does that mean to say that they were guaranteed jobs? On the contrary, they liked the area and what they found important was to own a home. The evidence of how important this has been is that owning a home has kept the family unit together.
Let me give an illustration of how important owning a house is to the people in Niagara Falls. About eight years ago 1 had the opportunity of travelling to the United States in connection with a Mennonite program called the MDS. We travelled to the city of St. Louis, which is the gateway of the west. When we arrived there I asked myself what kind of disaster befell the place that a carload of six men was sent down there in order to provide their services to the area. On arrival we found that a Negro organization in that city was rebuilding the old part of St. Louis for the Negro people.
Hon. members might not be aware of the fact that St. Louis is the first place where people coming from the south have the opportunity to improve themselves economically before going farther north to the more industralized centres. I was appreciative of the fact that I was a Canadian at that time because this was soon after the racial strife which had taken place in the United States. The night we drove into the city we did something totally wrong but we got away with it. We found ourselves in an area which was inhabited totally by Negroes, and being white people and males we were in some danger in that section of the city. At one point we lost our way and 1 stepped out of the car for a moment. As soon as 1 did so, another car pulled in behind me, blocking me in. I did not know exactly what the reason for that was. 1 asked the man in the car for directions. We were looking for a certain church. He gave us directions and we went there. The next day when I told people what had happened, they could not believe that we got away with it without being beaten.
The first few days in the city we could not get anyone to pose for a picture. We wanted to take pictures of some children there but they would not allow us to do so, until the third day when a lady asked us why we were there and where we had come from, to which question we told her we were from Canada. The whole situation changed then, the atmosphere in the whole community changed, when they found out we were Canadians. It really made me proud to be a Canadian.
But I learned a lesson that was even more valuable than this one. There were three people connected with the program there; one was a businessman who had given up his business in order to run the organization, and the other two were also businessmen from St. Louis, all three of them black. I realized what importance they put on owning a home when they said that they were rebuilding houses in their free time so that larger families could move into them. One of the businessmen said they could go to Washington to obtain interest-free money to restore these homes because they had a hard time borrowing money at 1 per cent to build these homes. I asked him why he did not take the interest-free money. He said that if you want to teach the Negro people responsibility you have to give them a sense of responsibility. Instead of giving them the money free he arranged loans at 1 per cent interest. In effect, this gave them a sense of responsibility.
The important thing is not to give handouts because that makes people totally dependent upon the government. We must provide a sense of responsibility, and I believe that is exactly what this bill does. This bill does not make the people come to the government on their knees and become dependent on the government but, rather, it allows them to achieve something on their own with the assistance of government. That is what makes me happy about this program.
I heard members of the NDP say we were not being fair to certain people, particularly those at the lower end of the income totem pole, and perhaps some senior citizens. I should

November 21, 1979

like to put one fact on the record. I have been involved in two senior citizens' projects, one ten years ago and one about two years ago. To a certain extent I agree with what has been said, but I should like to clarify one thing. Perhaps this is not true in provinces like Manitoba, but in at least three provinces in Canada, including the province of Ontario, those people who have no assets and no income other than the old age pension are well looked after. They can receive rental units for as low as $46 a month.
A lady came to me not long ago and said that if only her husband was alive they could move into this kind of accommodation. I have had people tell me they have never lived in accommodation as good as that being provided to senior citizens. These accommodations are subsidized, and 1 agree with government subsidization in that regard. I do not disagree with these programs that are in place, but I bring forward this fact to set the record straight.
We are not discriminating against these people by this program. The people who may suffer to some extent are those people who have worked hard and have saved a little for their old age. These are the people who have not been at the lower level of the income scale. I take my hat off to Canadians who have worked hard all their lives. Many of them have now sold their homes and have a little money. They are proud people and will not accept government housing. If they disposed of their life savings they could then obtain government relief, but their pride does not allow them to do this. Many of them will not accept anything from the government because they are so thankful to have been able to live in this country, most of them knowing what it is to live somewhere else.
Let me give an example. An elderly couple came to see me about a month ago. They originally came with a problem and they ended up showing me an uncashed cheque for $179. It was a cheque for rental subsidy from the Ontario government.
I asked them why they had not cashed it and these two old age pensioners both told me that they were so thankful to be in Canada they would not accept a single cent from the government. These are the kinds of people who sometimes can be hurt by our tax system.
While 1 was mayor of the town of Niagara-on-the-Lake 1 was approached time and time again by people who said that if only something could be done to alleviate the local tax burden they could continue to live in their homes. I heard this same comment many times during my election campaign. I am very thankful that this tax rebate program is something that will be of benefit to these senior citizens who are finding it hard to maintain and keep up their homes. This will alleviate some of their tax burden. I am very thankful for this program because of what it does for these people.
Let me approach this subject from another point of view, and 1 do so with a little bit of knowledge of the building industry. I used to be in the home building industry. Although I never had the opportunity to grow up on the farm, I love farming and 1 am farming at the present time. 1 have been in full-time farming since 1961, and prior to that I was in the
Mortgage Tax Credit
building business. I started as a labourer and finally formed my own company.
I became interested in politics when 1 was about 12 years old, having met the prime minister of Canada at that time in western Canada. I had the opportunity of shaking the hand of Mr. Mackenzie King.
An lion. Member: A great man.


Jake Froese: 1 think I know more about Mackenzie King than most of those in the opposition today, as I followed everything he did. 1 guess that is the reason 1 never could become a Liberal. Mr. Mackenzie King did a great many things for the purpose of getting re-elected. We all know about the one thing he did for re-election that he became famous for, and that was bringing in the baby bonus. He used the Canadian public in many ways to get himself and his party re-elected, and he did so on many occasions by using the building industry. 1 have the facts before me and I will read them for hon. members opposite, if they like.
In a sense my success in the building business can be related to my knowledge of what Mackenzie King did while he was in government. Each year before an election changes were made either in the down payment required to buy a house, or in some other related area. As a result this would create a building boon during an election year. This did not happen once, it happened time and time again. Then within two years after the election the building industry was as flat as it could be. This is the way in which he used the Canadian public. If we look at the history of the building industry, we will find that as thaf industry went in this country, so went the Canadian economy. The building business has always been the icing on the cake in the Canadian economy.
What happened to our building industry? Some of the things which happened were good for the industry. It hit a high, and then it went down, and it appeared as though prices within the industry were levelling off. TThat is where the chaos began. I heard a member on the other side say that our costs went up because of high profit. I know that that is exactly what they are saying. In the 1970s the Canadian government which was in power at that time kept pumping, pumping and pumping money into the industry, changing interest rates and changing down payments and increasing loans. As a result, there was no levelling off at any time. Who made the money? The profit from these homes to the builder who built the house and sold it went from as low as $300 to as high as $5,000 per home.
The money and the incentives, plus what was mentioned by my colleague yesterday and which I do not wish to repeat, was so evident in the building industry that it can be seen in the fact that because of the give away programs of the former government today we have homes which people could really not afford. This has destroyed the building industry. I am excited about this program and 1 believe it will bring our industry back to its feet.
1566

November 21, 1979
Mortgage Tax Credit
Hon. members opposite have said much about the high-interest rate. For the first time since 1970 the cost of building materials has levelled off. For the first time there is a realistic price on building materials. It is because that former government did not do its part in stimulating the industry properly that it has taken so long. When 1 was the mayor of the town of Niagara-on-the-Lake, we had a subdivision, which was very rare for that town. 1 am very thankful that they are very rare to the town of Niagara-on-the-Lake because that is the last land which should be used for a subdivision, but it was an area which could not be used for farming. The gentleman who started the subdivision began on the basis that he would get "X" number of dollars for his subdivision. The lots were so lucrative that he sold 40 to the builders. The builders saw the extra money, and they did not sell those lots until 50 per cent was put up toward the lots. This man expected to sell those lots for $8,000, but when he saw the inflation caused by the unrealistic incentives given to the building industry, the lots went from $8,000 to $22,000, and this because of the former government. The building industry is still suffering from that situation. 1 am thankful today that we have a program which will almost completely relieve the industry of the programs introduced by the former government. For three years the home building industry has suffered.
Who can afford to build a home? For those people who have money in their pockets, it is an ideal time to build. But for the average Canadian or the young person just starting out, the situation created by the former government does not allow them to build a home. This plan will change all that. It will give these people an opportunity. I have five children who are at present looking to build a home. They say that the interest rate is too high. 1 could not agree more, but it is not high because of the government. It is high because of the financial situation left to us by the former government.
If I were a Liberal I would be the last person to run for re-election if after 11 years 1 had created the current interest situation which this country faces. I would not sit on that side of the House or anywhere in this House if I were responsible for creating the chaos that has been created in this country and the indebtedness which they have left to our young people. We are not only asking our young people to pay high interest rates; we are asking them to pay the debt created by the last government. How will they ever get out of this situation? My part is committed to reducing this debt, but we do not want to forget about the person who wants a home, or forget that the most important thing to most people is owning a home.


Marcel-Claude Roy: Mr. Speaker, first I would like to congratulate the hon. member who just resumed his seat, not necessarily for the content of his message but because it was, as he told me, his maiden speech. So I congratulate him on that, but if he continues to use the tone of voice he used today-


Miss Begin:: He will have a sore throat.


Marcel-Claude Roy: He will last as long as his party will stay in power.


An hon. Member:: Not for long.


Marcel-Claude Roy: Mr. Speaker, November 21 is a somewhat special date, particularly for Liberals, but also for all Canadians. We saw today the House pay tribute to a great Canadian who worked to develop Canada's human potential and resources, wherever they are, to redistribute them among individuals, families, provinces and regions within the provinces. To that great Canadian, Mr. Speaker, with whom I have been proud to work, I would like to pay a tribute of gratitude, the tribute of all the people in Laval. And I am sure, Mr. Speaker, that the content of the legislation we have before us today does not reflect at all the Liberal philosophy I just mentioned and which was advocated in all areas of this country during the last election.
Mr. Speaker, about Bill C-20, an act to amend the Income Tax Act to provide a tax credit in respect of mortgage interests and home owner property tax, it seems to me we should not be asked as members of this House whether we are for or against the bill. It seems to me we should rather look carefully at this legislation and determine what need there is for it. Is this an appropriate time? Will this money be distributed in an equitable way? Will it be distributed to people who need it, or is it simply a matter of keeping another election promise that does not reflect, 1 think, the needs within the priorities or the imperatives that will have to be those of the government in the present economic context? 1 think we have to reflect together on those issues rather than ask whether we approve of the bill or whether we are against it.
We are all in politics. Handing out money is always popular, and this may sometimes be the way to fast popularity. If in the present state of our economy we could afford to hand out that money, 1 believe nobody would like to vote against such a piece of legislation. But in this party, with that conscience I referred to earlier when paying tribute to Mr. Pierre Trudeau, we are responsible enough to think in terms of managing public funds. Managing means studying the facts, the needs and then giving people or families what they need. Managing is making choices. To us Liberals, this has always been the basic principle of our philosophy.
I would like to deal now with the question of whether the needs are really there. There has been extensive discussion of the housing problem in Canada these last few years. In my view, that debate did reach its climax in 1969, when the Task Force on Housing and Urban Development published its report in which it suggested that although there was no urban crisis, there certainly was an urban problem because in the minds of most Canadians the housing problems was, according to the commission report published in 1960: "The housing problem is in itself the urban problem." It may be remembered that it was after that report that we had a seminar in Vancouver.
November 21, 1979

You, sir, who are now in the Chair and are also member for Beauharnois-Salaberry (Mr. Laniel), attended the seminar in Vancouver, in Harrison Hot Springs, where we laid the foundations of a housing policy, whereby we suggested through our leader, Mr. Trudeau, that the needs of Canadians had to be met, wherever they might live, whether in St. John's, Newfoundland, in Quebec City, in Toronto, in Vancouver or anywhere else in Manitoba. Canadians in ever-increasing numbers would be moving into urban centres, and the Canadian government had to help those people who would require not just housing, but quality housing. After that study and those findings, the Liberal government set up a Ministry of State for Urban Affairs in order specifically to work with the provinces, with various social bodies and with municipalities to develop not one but a number of programs, to establish a sampling of programs capable of catering to the needs of the Canadian people. What has happened since? As I said, in 1968 we built some 70,000 housing units. What has happened since 1968, sir?
1 have here the 1978 annual report of the Canada Mortgage and Housing Corporation which says that the annual average of new housing starts from 1969 to 1978 in Canada exceeded
235.000	units. In the last ten years, from 1969 to 1978,
235.000	housing units have been built compared with over
250.000	for 1978 alone. Before the Minister of Finance gets down to establish a new housing program, we should consider the situation. We should try to identify housing needs, study the quality of housing made available to Canadians and see if housing is plentiful enough.
Mr. Speaker, I think it is very important that we should study the question of quality of housing in Canada. I refer to a Gallup poll made in 1968 and in 1978 whose purpose was to get an indication of housing conditions offered to Canadians. The question was as follows: Are you satisfied, dissatisfied or indifferent about your dwelling? The survey was made throughout the country in October, 1978. According to that poll, more than 85 per cent of Canadians were satisfied with their accommodation. In the Atlantic area where the financial problems are the greatest, more than 79 per cent of the people said that they were satisfied with their housing.
In 1968, the degree of satisfaction was 60 per cent while in 1978, according to the Gallup poll, 85 per cent were satisfied with their accommodation. In 1968, 34 per cent were dissatisfied and in 1978, 13 per cent only were dissatisfied.
Mr. Speaker, I am really trying to see on what basis that legislation was introduced for consideration by the Minister of Finance as a priority that had to be passed before Christmas. I am trying to see what are the quantitative and qualitative needs of Canadians.


Mr. Chenier:: Never.


Marcel-Claude Roy: This is the situation. I mentioned that the performance was not that bad. As for quality, I think that once
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again the Gallup poll reveals that it is very good. We are conscious of the fact that there is room for improvement. It is obvious that we must continue to have some. This is why the previous Liberal government had introduced a bill which was given three readings and was passed by the House of Commons on March 12 last. It was Bill C-29, an act to amend the National Housing Act and the Central Mortgage and Housing Corporation Act, and it provided for an additional program to continue to improve housing conditions.


Jacques Raymond (Ray) Chénier: Improper priority of the Progressive
Conservatives!


Marcel-Claude Roy: Sometimes we make comparisons with the United States which already has a program such as the one being proposed by the Progressive Conservatives. In the U.S. there are 235,000 housing units a year. The number of housing starts in the past few years is as follows: in Canada, we built 11 units per 1,000 people whereas in the U.S., over the same period, there were only eight units per 1,000 people. In other words, under our housing policy we built more units per 1,000 people than in the United States, II units per 1,000 persons compared to eight units per 1,000 to be precise.
I am still trying, Mr. Speaker, to understand why the Progressive Conservatives are introducing such a piece of legislation. According to the statistics that I have before me and that I have just given, there does not appear to be any urgency or need for this measure, as they would want to make us believe. There is no urgency. That is why we tend to think that only to fulfil a haphazardly-made electoral promise the government is now ready, despite other priorities, to go ahead with a measure which, in my view, is discriminatory.
Mr. Speaker, I said that we are aware of the fact that we must continue to work towards improving housing conditions for Canadians, but for all strata of society; not just for the haves, but also for those who have family responsibilities, those who have reached an age where incomes decrease instead of rising, those whose needs and obligations remain the same, or for those who live in underdeveloped areas. It seems that this bill in no way reflects the needs of that sector of Canadian society, bearing in mind the statistics I gave at the start. It seems to me that the figures quoted by the Minister of Finance (Mr. Crosbie) are too negative and in no way prove that all levels of Canadian society benefit from this bill according to their needs. Instead, it reflects once again the initiative of a Progressive Conservative government that gives in to regional pressures from those who are better off. I would even say, Mr. Speaker, that I am convinced that, if in the riding of the Minister of Finance, as well as that of the minister responsible for housing, the Minister for Regional Economic Expansion (Mr. MacKay) people were asked to choose between the present housing policy and this one they are being asked to swallow whole, they would say they feel far better protected by the present policy.

November 21, 1979
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I asked earlier: Does our economy justify that kind of investment? 1 spoke earlier about the yearly construction of
235,000	housing units over the last ten years. We had programs, Mr. Speaker, set up by Canada Mortgage and Housing Corporation, in every field, including programs for the rural areas and our native peoples. We set up a program, in co-operation with the municipalities, to organize community services, under Bill C-29 which the House passed on last March 12, and which offered substantial grants to the municipalities for community projects.
We used to have a special assistance program of the Government of Canada regarding community housing. We have a guaranteed loan program for rental housing, and we used to have a renovation assistance program. 1 would have liked to know the intentions of the government respecting the continua-* tion of all those social programs. The Liberals are concerned about the future of existing programs. And yesterday, Mr. Speaker, 1 wonder whether all hon. members witnessed a demonstration right here on Parliament Hill where people came to urge the Liberals to make pressure so that family allowance benefits will not be reduced-


An hon. Member:: Shame!


Marcel-Claude Roy: -so that the future government housing policy will not benefit only the more fortunate Canadians to the detriment of those who most need it. I see that the hon. member for Saint-Leonard-Anjou (Miss Begin), the former minister of health and welfare, is in the House. With other Liberal members she met those people who had come to Parliament Hill to try to bring their problems to our attention. But I am sure that the former minister of national health and welfare has indicated to them that it was not only to make us aware-for we were already aware-but to make the Canadian people aware that we would spare no effort to make sure that public funds would be spent to meet real needs, and not to honour election promises made on the spur of the moment, because statistical data indicate that there is no housing crisis in Canada, Mr. Speaker.
I mentioned a while ago the housing construction program for the aged and the Assisted Home Ownership Program. How much has the Liberal program administered by the Central Mortgage and Housing Corporation cost over the past ten years? Well, according to the nearly complete sampling procedure which 1 described earlier, it has cost $2,266 million. And now the new government puts a gun to our head, so to speak, and demands that we adopt before Christmas a housing policy which, by 1982, may cost as much as $3 billion a year, while the whole program of the Liberal government had cost only $2,226 million over a ten-year period. And now the new government wants us to swallow a program which will cost in 1982 some $3 billion, in order to distribute this money among the richer residents of the richer municipalities and provinces.
[Mr. Roy (Laval).)
I think that other hon. members have already emphasized in the House that the richer provinces will benefit more from this program. It is clear that Quebec will not be among the favoured ones, if we accept the bill as it is drafted now.
1 suggest that this legislation is discriminatory, as mentioned by the former minister of national health and welfare and hon. member for Saint-Leonard-Anjou. This policy will discriminate against 40 per cent of Canadian tenants.
And then, Mr. Speaker, what about the 27 per cent of home owners, that is 2,200,000 taxpayers, who have paid off their home, whose home is clear of any mortgage? This initiative of the Progressive Conservative government seems to me to apply only to one-third of taxpayers, those who classify theoretically as being entitled to the mortgage loan and property tax credit.
In light of all those figures I have tried to make hon. members fully aware of that and to say that there is no urgency in housing, that this is not a housing policy but rather a matter of keeping an electoral promise inspired by guesswork and not necessarily consistent with statistics. Mr. Speaker, 1 challenge the Progressive Conservative members or the minister to question the figures I just mentioned. However, as 1 said a moment ago, if we had the funds required I believe nobody would oppose this legislation, but we have to establish a set of priorities.


An hon. Member:: Right on. Wrong priority on the part of the government.


Marcel-Claude Roy: Being the representative of an urban riding which is rapidly expanding and which also benefited from programs already established, 1 would agree to add, as my colleagues have suggested, some improvements to the act, namely a reduction in the property tax. That would affect all owners whose houses are paid off and no longer mortgaged. The income of those people may have gone down in the last few years. Elderly Canadians want to keep their homes. 1 would agree to amend the act or consider a separate tax credit in respect of property tax. It seems to me that that way we would be helping many more Canadians, we would not be penalizing those home owners who have already paid off their mortgages and we would be helping elderly people who wish to keep their houses and can no longer afford to because of the yearly increase in municipal rates. That would certainly be more appreciated and more liberal philosophically speaking. It seems to me, Mr. Speaker, that that proposal should be considered.
I would have liked to know better the Progressive Conservative program about the tremendous increase in interest rates. I would have liked to know the public housing program of the Progressive Conservative party. 1 would have liked the Progressive Conservatives to tell us what they intend to do about the Canada Mortgage and Housing Corporation.

Is this legislation a means of superseding the Canada Mortgage and Housing Corporation to eliminate existing programs and through taxation distribute funds of $2 to $3 billion to those who are already fairly well off? We are not ready to vote for or against such legislation, Mr. Speaker, because Canadians are wondering what will become of the Canada Mortgage and Housing Corporation that has been in charge of our housing programs. We succeeded in having a yearly average of
235,000	housing starts.


An hon. Member:: Excellent!


Marcel-Claude Roy: We had the Gallup poll I mentioned at the beginning of my remarks, according to which 85 per cent of Canadians are satisfied with their present housing, in 1978. We achieved all that thanks to the Canada Mortgage and Housing Corporation. However, 1 would like to know what will happen to the corporation before voting on this legislation.
In conclusion, Mr. Speaker, it seems to me that one can judge how important are the food chains that advertise and are very popular by the number of customers they get. In the food business, we hear that Steinberg's is on our side. It is a commercial, Mr. Speaker. 1 would say that Canadians are aware that as far as energy and housing are concerned, the Liberals are on their side.


An hon. Member:: Indeed! The Progressive Conservatives are against them.


Mr. Bill Yurko (Edmonton East):: Mr. Speaker, 1 am pleased to again get up in my place to speak in support of Bill C-20. I have been impressed by the honesty and the concerns expressed by the various members when giving their views on this bill. The people of Canada also have a view, an honest one. They have indicated to us that they are in favour of this type of bill.
The only time I was somewhat distressed was when a member across the way this afternoon questioned the propriety of members voting on this bill because they own a house and might therefore have a pecuniary interest in this bill. In my opinion, that is a ludicrous position, hardly sufficient in scope or intelligence to be placed before this House.
There are many pieces of legislation that come before a provincial legislature or indeed the House of Commons which affect each and every one of us in some manner. The income tax legislation affects every one of us. Therefore, to put Your Honour in the position of having to rule on the matter is below the level of debate that should occur in this House. If the hon. member feels so bad about this bill, perhaps he will not want to claim the tax credit. As well, some on the other side who own businesses or apartments may not want to deduct their property taxes and interest paid with regard to those businesses and apartments.
Mortgage Tax Credit
It is important that we pass this legislation before Christmas so that Canadian families who own homes might take advantage of this deduction and reinvest their money in other areas of the economy. I might say that the idea of mortgage deductibility and tax deductibility from income tax is not a new idea, as some members have said.


An hon. Member:: You never have new ideas.


William J. Yurko: I have no hesitation in saying that as minister of housing in Alberta I suggested this proposal to the former minister in the Liberal government in 1975, 1976 and 1977. At a sectoral conference of housing ministers in Alberta in January, 1978, a conference which I initiated and which was the first of a series of sectoral conferences, this issue was very specifically discussed. We dealt with it in two forms. First, we dealt very specifically with property tax as a deductible item from income tax paid. The view was very strongly expressed that no person in our society should have to pay tax on tax.
The fundamental principle here is that people are paying taxes on taxes. This is a beginning toward removing an inequity for certain people in our society. I hope later to state approximately how many in this nation own their own homes. Certain people in our society are paying taxes on taxes that they have already paid. It is very easy for tax accountants to get up and confuse us with technical terminology and suggest there is no equity here or that there is no equity there. Mr. Speaker, there is no equity in a tax in the eyes of the person who has to pay that tax. But by far the greatest inequity is when people, particularly home owners, have to pay tax on tax. That is a totally improper type of tax.
1 want to tel! hon. members what happened at that sectoral conference of housing ministers from across the land.


An hon. Member:: You weren't there!


William J. Yurko: I chaired the conference. There was unanimous agreement among the provincial ministers. We met on the first day as provincial ministers only and on the second day we met with the former federal minister to tell him what we had agreed upon the previous day. We came to the unanimous decision that property taxes up to a certain level should be deductible for income tax purposes. There had been agreement from Progressive Conservative governments, from a Liberal government-at that time Prince Edward Island still had a Liberal government-from NDP governments and from Social Credit governments. Governments from every party in the country recognized the need to make property tax up to a certain level deductible by home owners, fundamentally because of the inequity of paying tax on tax.
A large percentage of poor people are paying 35 per cent of their net incomes on acquiring their homes. Some of them are even paying as much as 50 per cent of their net incomes for this purpose and they are being called upon to pay a double tax, tax on tax. I say that no poor people, or people with average incomes, should ever be called upon to do that.

November 21, 1979
Mortgage Tax Credit
At this conference, as 1 was saying, governments across the political spectrum agreed at the provincial level that deductibility was the answer. If my memory does not fail me, and I can be corrected on this, the New Democratic government in Saskatchewan, prior to the last election, came out with a modified system of its own providing for a rebate. Indeed, the party in the corner opposite me whose members have been arguing so strongly against this bill may be surprised to know that the government of Saskatchewan, one of the strongest provincial governments in the nation, adopted a measure almost identical to the one before us. Why did they do so? Was it because of their philosophy? Maybe they did so because it was good politics. What is wrong with good politics when it helps people? What is wrong with good politics when it helps a lot of people?
There is no doubt we are the best housed people in the world. Our occupation rate for housing units is, if I remember correctly, just below three and our housing stock is fairly young. The ratio of home ownership to apartment dwelling is still fairly high. So we are well housed.
At the present time, though, we are entering a new era in housing, one which is related to very high energy costs and severe new demands on services. Moreover, a lot of the housing stock owned by average Canadians is in need of repair. One of the fastest rising costs in the field of housing besides interest rates in the last couple of years is represented by property taxes. Property taxation in this nation is rising dramatically because we have enjoyed and demanded a highly upgraded kind of urban life. Nothing in our society has been more dramatic than the rate of urbanization in the last 25 years. People have demanded all kinds of new services, particularly at the municipal level. Municipal taxes used to be levied for water, road work, street lighting and so on. Today municipalities provide a wide range of services, including education, social services, special services for single parents who wish to put a child into a day care centre, and so on. No end of services are provided at the municipal level and the tax burden has become increasingly heavy in consequence.
It is interesting to note the high percentage of home owners there are across the nation. From now on our housing stock will be increasingly in need of repair and I suggest that CMHC will, in future, be more involved in repairing and insulating housing than in building new units. But here are the home ownership figures: Newfoundland, 80.6 per cent; Prince Edward Island, 77.6 per cent; Nova Scotia, 72.4 per cent; New Brunswick, 71.8 per cent; Quebec, 50.4 per cent; Ontario, 63.6 per cent; Manitoba, 66.4 per cent; Saskatchewan, 75.4 per cent; Alberta, 64.8 per cent; British Columbia, 65.3 per cent; the Yukon and the Northwest Territories, 34.5 per cent; Canada as a whole, 61.8 per cent.
All of us know that there are senior citizens who are in a difficult position. I have opened more senior citizens' housing in three and a half years than most people here in this chamber. And I am repeatedly told by those senior citizens that they would have preferred to stay in their own homes but
(Mr. Yurko.]
they could not afford to do so. So they moved into government housing where rents are geared to their incomes.
Because some senior citizens do not pay income tax, they may not get the advantage of this program, and it is therefore being suggested that it is unfair. There are other programs to deal with senior citizens. One of them is the construction of government housing which has been happening on a massive basis in this nation. Senior citizens are moving away from the loneliness of their own homes, in some instances, and into an atmosphere and environment which they enjoy. 1 am proud that CMHC and the provinces have come out with a number of excellent programs. Suites of 500 to 700 square feet of excellent living space for senior citizens are being supplied. This is a very enjoyable type of housing which provides an existence for many people in their later years, although not all senior citizens have gone to this form of housing.
This program is not a one-time program. It is not a two-year program, a three-year program or a five-year program.


An hon. Member:: It is a nothing program.


William J. Yurko: It is a program which we hope will continue, unless some silly party forms the government and negates it later. It is a program which will last a long time, and much housing stock will revert from senior citizens to young couples and from middle age people eventually to younger folk. All that housing stock will at some time or other house people who need breaks and who will repair much of that housing stock.
That is one of the reasons this is fundamentally a sound program. It was recognized by provincial governments across the nation with regard to the property tax deductibility aspect. It was not only recognized but, indeed, implemented by the NDP government in Saskatchewan. I must say that just now and again that party over there has a good idea and implements it. That does not happen often, but I do have to give it credit every now and again.
I want to talk about mortgage interest deductibility because mortgage interest deductibility is in a different category. To be perfectly honest, at the sectoral conference on housing in January of 1978 among provincial governments provincial ministers could not reach agreement on this. We could not and did not find a consensus on mortgage interest deductibility. We sent the matter back for more study. One of the reasons we sent it back for more study was that we recognized what was happening to the housing stock in the nation. Housing stock was very high. In many situations one person was occupying 2,000 square feet of housing stock. In others, couples, be they senior citizens or whatever, were occupying in excess of 2,000 square feet of housing stock. We knew what was happening or what was going to happen to energy costs. It did not take any great magician at all to recognize that energy costs were going to skyrocket. When I lived in New Jersey my energy costs were in the order of $50 a month. I visited my brother the other day.
November 21, 1979


Mr. Campbell (LaSalle):: Mr. Speaker, I rise on a point of order. There is a piece of legislation before this House. I think the hon. member is straying. The indulgence of the Chair has been that we can sway from the subject, but the subject is tax credits and interest rates, not the hon. member's stay in New Jersey, senior citizens' residences and so forth. 1 think the hon. member should stick to the subject and we will listen to him, but this is nonsense.


William J. Yurko: Mr. Speaker, I have not heard such nonsense for some time. An hon. member opposite talked about mortgage interest deductibility in the United States and tax deductibility in the United States. The hon. member has the gall to get up and suggest-


John Campbell: We are in Canada, not the United States.


An hon. Member:: Never mind New Jersey.


William J. Yurko: I just want to give an example of the rate at which energy costs are rising. United States prices are ahead of ours by a couple of years. On the same house in the United States the average energy cost was $270 a month after a matter of eight to nine years. We are about two years behind. The energy costs in Canada in connection with urban communities, which have been built in a very scattered way, will indeed impact on our society in a major way, and governments will need more programs to alleviate the tax load at the local municipal level. Indeed, we will need more tax measures to alleviate the load on home owners in this nation, and if hon. members opposite do not think this is necessary-every indication they have given is that they are totally opposed to giving the home owner a break-then I would like to meet them in the next election campaign on that very issue and tell every one of them that governments in this nation of every political stripe recognize the value of this type of program.


An hon. Member:: That is the only platform you have.


An hon. Member:: One more than you.


William J. Yurko: Housing is an area of considerable importance in this nation. It is an area of concern which is very close to my heart, for the simple reason that I have been involved with housing in a major way not only nationally at national conferences, where we got together repeatedly as provincial ministers with the federal minister, but also provincially where we have upgraded our housing stock in the province of Alberta and in just three years took the number of new units coming on stream per year from 15,000 units to 48,000 units. That was in just three years, so one can accelerate rapidly the construction of housing stock, and nowhere in this nation has this been proved more than in Alberta. That can be done. Any time you want to provide incentives to get housing stock on the market, you can do that; but what we have to do with this bill is address ourselves to what is necessary to deal with the cost of existing housing stock, monthly tax bills and monthly interest bills from here on in. That is what this government is doing,
Mortgage Tax Credit
and 1 suggest it is moving in the right direction in terms of the entire housing picture in the nation from here on in.


Mr. Gary F. McCauley (Moncton):: Mr. Speaker, first of all I would like to ask my colleague and a great Canadian from northern Ontario, the hon. member for Timmins-Chapleau (Mr. Chenier), to come over and protect me from the slings and arrows of outrageous insults from across the way as 1 go through my speech. Would the hon. member come over here?
This has been a momentous week in this House, two days of which I will never forget. For us on this side of the House this has been a day in which we have witnessed the resignation of a great Canadian from the leadership of this party. We were all tremendously moved by the reception he received when he announced that resignation this morning and also by the reception he received this afternoon in the House from both sides, from the Prime Minister (Mr. Clark), from the House leader of the NDP and from the House leader of the Social Credit party. It was a tremendously moving experience for me personally and, 1 am sure, for all of us here today. It goes to show that, despite the insults we trade and will trade in the next few minutes, we do share a common vision of this country. We are all together in our goals if not in our policies; we do care about this country and we respect each other. So this was probably the most memorable day of my life.
The second most memorable day was Monday night. I do not think that ever in my life have I witnessed such a performance as 1 witnessed Monday night when the Minister of Finance (Mr. Crosbie) introduced this bill. I felt that I was at a revival meeting with an Evangelist who was trying to sell me a bill of goods. I felt that "St. John Crosbie" was really getting into it in terms of trying to put across a program in which he did not really have his heart but which he wanted to con us into believing he did. He spoke with all the fervour of a convert, which of course in political terms he is. I almost felt that if he had issued an altar call at some point in his speech, all of us on this side of the House would have gone down on our knees in front of him and repented for our sins.


An hon. Member:: That would take a long while.


Gary Francis McCauley: No, it would take only 30 seconds. One of the greatest spectacles I have ever witnessed-and 1 want to congratulate the Minister of Finance for the tremendous roles that he plays in this House-was on Monday night when he was the Evangelist. He also plays a role in the question period, what 1 would call the glowering inferno, acting out righteous indignation. He is a tremendous performer and he plays many roles, that of the clown, that of the buffoon and so on. I have a great deal of admiration for his ability to play all these roles.


An hon. Member:: Except for his ability as Minister of Finance.

November 21, 1979
Mortgage Tax Credit


Gary Francis McCauley: That is right. He cannot do anything right in that role. He does a fantastic job playing all these other roles, however.


The Acting Speaker (Mr. McCain):: Order, please. It is the general practice of the House that we restrict the right to speak to one person who, ! think, should remain relevant and on the subject. We should let the speaker have the floor to himself.


Gary Francis McCauley: Thank you, Mr. Speaker. One of the points the Minister of Finance made was when he quoted extensively, for about 15 minutes, from an article by a criminal lawyer by the name of David Greenspan, an article which he used to support the bill and to support his position. Of course, he quoted selectively from the article and neglected to point out something with regard to the property tax credit that I think is worth pointing out to the people of Canada and to the House. Mr. Greenspan said, in the second to last paragraph of his article:
The proposed property tax credit is important to municipal governments because it offers politically acceptable breathing room in which to raise taxes.
The voters of New Brunswick have had some experience with that kind of shifting of the tax bite from one hand to the other. A few years ago we were promised that the provincial government would get out of the property tax business. They were phasing it out while at the same time the municipalities phased it in. This is exactly what is going to happen with this famous property tax credit about which the minister spoke so eloquently. However, he had neglected to mention that the vacuum would be filled by the municipalities and that the Canadian taxpayer would be no better off.
I would hate to use the word "fraud" in describing this tax bill-it is too strong a term although 1 tend, in my weaker moments, to think of it in those terms.


Walter David Baker: It might be unparliamentary as well.


Gary Francis McCauley: "Deception" is a good word, but let us use the word of the Minister of Finance. He called it a scheme. Not being very learned, I looked up the word in my handy pocket dictionary. It says: "artful or underhand design".


An hon. Member:: That is right, the scheming minister.


Gary Francis McCauley: That is a good description of this tax bill. It is an artful or underhand design for a number of reasons. First of all, the minister himself has admitted that he thinks the mortgage interest and property tax credit scheme is "inconsistent"-that is his word-with the goals of his budget. But, as he explained in a radio interview, political parties have to make good on some of their promises sometimes, and that was one of those times. Well, that was okay, I suppose, with the Jerusalem embassy, but perhaps not okay in view of the fact that this country lost $5 million worth of business. But how can the minister, if he feels that this bill he introduced on Monday night is inconsistent with the government's philosophy, stand up in the House in good conscience and try to
[Mr. McCauley.)
convince the people of Canada that it is a good thing? It is quite beyond me.
The minister went on with his artful or underhand design or scheme to tell us what the people of Canada want and that that is why the people of Canada voted for a Conservative government on May 22. Is that a fact? Who wants it? Do renters want it? Do the elderly who own their own homes want it? Did the people of Canada vote for the Progressive Conservative Party because of that?


An hon. Member:: Only 35 per cent of them.


Gary Francis McCauley: Not even that many. According to a Conservative party poll taken immediately after the election, 2 per cent voted for the PC Party because of the party's promise to bring in mortgage tax deductibility. So only 2 per cent of the voters of this country want it. That is not what you would call a stunning majority.
The other question which 1 have with regard to this artful or underhand design or scheme is, who pays for it? Where is the money going to come from? That is a question that the Canadian people are concerned about. They want to know the answers to it because they know governments do not hand out anything with one hand without taking something else from their pockets with the other.
Some people are concerned that the government is going to finance this underhand design by abolishing family allowances. As we all know, there is in the air the idea that the government plans to do three things with regard to family allowances. The first is to abolish family allowances entirely; the second is to increase the refundable child tax credit by the amount of the allowance; and the third is to reduce the child exemption by that same amount. The intended effect of all that on the lower income half of Canada's families is roughly nil, zilch. What such families lose of the allowance, they get back from the credit. The tax they would have paid on the allowance is balanced by the tax they would have saved from the matching portion of the exemption.
Higher income families, on the other hand, so the story goes, are to lose benefits, and these will be used to finance their mortgage interest and property tax credits. The government will certainly deny it, but there are many reputable people who believe that this is exactly what will happen.
The other thing about which 1 am concerned in this underhand design or scheme is the regional bias.


Mr. Munro (Esquimalt-Saanich):: On a point of order, Mr. Speaker, 1 would just like to draw to the hon. member's attention the fact that there are other definitions of the word "scheme". For his selective illiteracy I would like to draw to his attention that "scheme" also means "systematic arrangement proposed in operation; a table of classification or of appointed times, outline, syllabus; a plan of construction, work, action"; and then it goes on to the pejorative use of "scheme". Thank you, Mr. Speaker.
November 21, 1979


An hon. Member:: Those definitions don't apply.


Gary Francis McCauley: Certainly not. Why pick ones that do not apply, Mr. Speaker?


Walter David Baker: On a question of privilege, Mr. Speaker, the hon. member for Moncton (Mr. McCauley) has perhaps not yet learned the rules here. The Minister of Finance (Mr. Crosbie), whom he would call underhanded, a schemer and so on, is not in the House at the moment. Perhaps he might reserve his intemperate remarks about the minister for a period of time when the minister is here to answer.


Gary Francis McCauley: Mr. Speaker, I would like to correct the hon. member. I did not and do not refer to the Minister of Finance as an underhanded or artful schemer, I referred to the plan. 1 am not attacking the man, I am attacking the plan, and surely that is acceptable, is it not?
The other thing I am concerned about, as I was saying before I was interrupted, is the regional bias of this-1 cannot call it a scheme anymore.


An hon. Member:: Plan.


Gary Francis McCauley: Plan, thank you. It transfers wealth to those areas of the country where mortgage indebtedness and federal taxes paid are quite high. Thus, in Ontario where 35 per cent of families and unattached individuals carry mortgage debt and pay relatively high federal taxes, these are the people who will gain most from the mortgage credit. People in the Atlantic provinces, on the other hand, where only 26.3 per cent of families and unattached individuals carry mortgages, and where federal taxes paid are relatively low, will benefit relatively less from the mortgage credit. Over all, the people in the Atlantic provinces and Quebec will benefit least from these credits, whereas the people in Ontario and in the west will benefit most.
To me, that situation enhances regional disparity at a time in this country when we are having great difficulty in coming to grips with a vision of this country that is bigger than regions and bigger than provinces, at a time when we are dealing with a government that does not see or share that vision, that cannot see that this country is bigger than a collection of provinces. This program or plan will enhance that difficulty. It will make it even more difficult for us to think of this country as a whole. When the people of Atlantic Canada get wind of this regional inequality and disparity that is inherent in the plan, they are going to be very upset and wonder if this government is really the government of all Canadians or is the government of a few Canadians.
1 do not believe the people of this country are so selfish or so greedy that they are going to latch on to this plan without realizing that it is discriminatory. 1 have faith in the Canadian people. I think the Canadian people are decent, altruistic and are ready, if given the leadership, to think of the less fortunate parts of this country and to do something for those less fortunate parts. I believe Canadians are concerned that this bill does nothing for the renters, nothing for those who have been industrious enough to pay off their mortgages, nothing
Mortgage Tax Credit
for the senior citizens and nothing for those who have no income.
I sat in the House the other night and listened to an hon. member opposite talking about the backbone of this country being the hard pressed middle class. I think there are other people who are the backbone of this country, just as much as the hard-pressed middle class. The elderly who put the sweat of their brows into the fabric of this country for years, those people who worked hard in their own small way to contribute to this land that we call Canada, are surely just as much the backbone of this country as any other group. Surely the working poor, the people who are too proud to go on social assistance and are just barely making it day after day. are just as much the backbone of this country as any hard pressed, so-called middle class.
The Prime Minister has suggested that reasonable and responsible amendments to this bill would be welcomed. I believe it needs reasonable and responsible amendments or alternatives because, as it stands, it is a blunt instrument, a sledge hammer, when what we really need is the touch of a surgeon's scalpel. The mortgage tax credit as proposed by the Minister of Finance is inequitable, inefficient and too expensive.
In keeping with the Prime Minister's request, we as a party would like to offer some responsible and positive alternatives that will at the same time be effective and not add to cost.
The proposed tax plan excludes major segments of the Canadian population. Among the excluded are those most in need of immediate assistance to help them cope with the rising cost of shelter. We would propose a national rental assistance program for the elderly and single parent families, and this would help those most urgently in need of relief. As the economy improves, and the government tells us it will, this program could be extended in the government's generosity to all renters in need.
As we all know, and as the previous speaker pointed out, the cost of operating and owning a residence is skyrocketing. The cost of heat and energy will go up and up. Services, maintenance and everything connected with the cost of owning a home is going up, so we would propose in view of that a residential operating cost tax rebate that could be provided for renters and home owners. That kind of program would be progressive, maximum payments being made to the lowest income groups, thereby putting the money where it is most needed.
Fet me make another suggestion for the benefit of the government. We all know that deducting interest rates is an attack on the symptom and not the problem. The real problem is putting enough money into the pockets of potential buyers so they can afford to consider buying a home in the first place. Registered home ownership savings programs have been shown to be extremely effective in this regard by helping people save so they can purchase a home. The Liberal party suggests that the government should encourage the extension and expansion of such programs by raising the current limit from $1,000 a year per person to $2,000 or $3,000 a year per person. This

November 21, 1979
Mortgage Tax Credit
would help people save in advance of their purchase so they might realistically be able to handle the subsequent mortgage payments.
We all know that the high cost of interest is creating a very serious problem, but these high interest rates have been created by the government. As the Minister of Finance keeps telling us, and we agree with him, hopefully this is a short-term problem. If they are a short-term problem, then perhaps they require a short-term solution.
In that regard we as the Liberal party would suggest that the minister implement two programs aimed specifically at the problem of short-term, high interest rates. The first of these programs would provide a mortgage interest subsidy on renegotiated mortgages. The program would provide maximum benefits this year, which would be phased out in subsequent years as mortgage interest rates drop. The second program would involve a mortgage interest rate subsidy for the puchase of new homes. As with the other program, this would also be reduced over a period of time.
High interest rates are serious and they are with us now. The Liberal party proposes strong action to offset these exorbitant interest rates, but it proposes action that is short-term and limited to the duration of the problem. The difference between our proposal and the government's proposal is that we will not be shackled with this program for the rest of recorded history.
In conclusion, we are suggesting that there are better ways of going about this plan than the ways suggested by the government. We have provided an indication of better, more effective ways in which the government could spend the taxpayers' money to achieve the desired end. That raises the question of why the government is sticking to the mortgage tax credit. There is no reason why they should stick to it. Perhaps it is to honour an election promise. That is not good enough for the Canadian people, and I know that they will not be fooled by a government that has no other reason for this plan than the honouring of an election promise. We have provided sincere and positive indication, as the Prime Minister has requested, that responsible alternatives do exist. We call on the government to show some leadership in this regard and to show the people of Canada that it is ready to make some sound decisions on their behalf. We want the government to be honest with the Canadian public, to repudiate this election gimmick and to adopt some serious and rational policies that will deal with the real problem.


The Acting Speaker (Mr. McCain):: The hon. member for Regina East (Mr. de Jong).


Stanley Howard Knowles: Hear, hear!


Mr. Simon de Jong (Regina East):: It is no wonder that there is labour unrest among the young people. The cost of supplying this basic human necessity has increased by leaps and bounds over the last half dozen years. Young working people must scrabble very, very hard in order to meet monthly payments, and, as a result, in many instances both the husband and wife must work. There are cases where families postpone having children because they want to buy a home.
Any member from a riding in which there are a fair number of young families, particularly members from suburban ridings in major Canadian centres, who knocks on doors and listens to his constituents will very quickly realize the extent of the problems that young working people face.
In answer to that need, the Saskatchewan government and the New Democratic Party of Saskatchewan in the last provincial election proposed a scheme to help new home owners, especially those who were less well-to-do. I noticed that an hon. member opposite from the Edmonton area referred to this. The Minister of Finance also referred to it in his speech, as reported in Hansard of November 19 at page 1464:
But the Ottawa government, the PC government stimulus and mortgage interest deduction, is going to be voted against by the NDP in this House, while the NDP in Saskatchewan gives its own mortgage interest deduction. What is wrong with this mortgage interest credit? Is it because it is being introduced by Tories that these idealogucs down in the corner are going to vote against it?
It is not because it is the Conservatives who are introducing this particular measure that we are against it. In fact, if we can persuade them to accept amendments in committee, we will probably vote in favour of it. The essential difference between this proposal and the Saskatchewan proposal is that this one will tend to help those who are already well-to-do and who do not need the help, while the Saskatchewan proposal is geared to income. It has a ceiling to ensure that the maximum $250 reduction in the provincial income tax which is related to the first $1,000 in mortgage interest payments is reduced as an individual's taxable income rises, so that there is a minimum deduction of $100 per year. In other words, as the ability to pay the mortgage increases, help from the government decreases. Those least able to pay for the mortgage receive the maximum benefit from the program.
That makes sense to us, Mr. Speaker, and I hope that hon. members opposite will also see the sense of it and accept our amendments in committee. I think our amendments will help them bring about all the things they would like the program to achieve, such as making housing more accessible to the Canadian people without increasing the government's deficit. I hope hon. members opposite will not be caught up in their own ideology and partisanship when it comes to voting on some of the amendments that we will propose in committee.
We are quite unhappy with the fact that this legislation will not benefit a great many people. It is really a major income redistribution program, a major tax item. Billions of dollars will go back to Canadian taxpayers but there is still a large number of people who will not benefit from the scheme. Hon.
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members who have any sense of fairness will recognize that this is an unattractive aspect of the bill.
When the Saskatchewan program was introduced, it was accompanied by a $115 renters' rebate so that they could also benefit from the program. The provincial minister of finance, Mr. Ed Tchorzewski, issued a press statement on September 14, 1979, in which he made this point:
Wc have in the past, and will continue to urge Ottawa to adopt a national program that is equally fair and balanced. It is well documented that tax deductions benefit upper income groups far more than the rest of society. Our tax credit plan, on the other hand, will ensure that the benefits will go to Saskatchewan taxpayers in relation to their needs.
The government took at least a partial step in the right direction when it changed from a tax deduction to a tax credit program. The amendments that we will offer at committee stage will urge them to take the other step, which will make this program much more acceptable and of greater benefit to the Canadian people.
We are concerned, Mr. Speaker, that Canadians have decent housing, and this program fails in several criteria. When we first examined it, we wondered if it was a tax policy, but 1 think, as other hon. members have also said, that as a tax policy it is unfair and regressive. It is a redistribution of income in a reverse sense: it helps those who are capable of helping themselves but does not offer any help at all to those less capable.
When we examine the American experience, figures from the U.S. treasury for 1977 show that 15 per cent of U.S. taxpayers, those in the highest income bracket, received 75 per cent of the benefits under their program. That is not a fair distribution of income, Mr. Speaker. I would suggest that the proposal before us has the same drawback. It does not make sense economically, and given the present high interest rate it will not do much to stimulate the housing industry. In fact, that industry will remain somewhat dormant until interest rates begin to go down. I do not believe the program will ultimately reduce the cost of housing; instead, I am afraid it will increase the cost.
Now, we must ask if it is a housing program and, if so, what sort of housing program. During the debate the Minister of Finance said it was a housing program, not a financial program and not a tax program, but a program whose major purpose was to make housing accessible and to relieve home owners of the high costs of housing in this country.
We are concerned that after the second, third and fourth years of the program, when its benefits are maximized, it will increase the demand for housing and, ultimately, the cost of housing. Economists have estimated that in years to come the cost of housing, because of this program, could increase from 10 per cent to 25 per cent. This kind of increase then gets built into the cost of housing. This has been the experience in the United States where they now find it impossible to withdraw the program. The tax benefits have been built into the homes and withdrawal of the program would mean a reduction in the value of homes, so it is locked in. Increasing the cost of homes does not make housing more accessible. Ultimately young

November 21, 1979
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people will be faced with higher mortgage costs and higher housing costs.
May I call it six o'clock, Mr. Speaker?


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

Thursday, November 22, 1979