1980-05-01

ROUTINE PROCEEDINGS


Mr. Gus Mitges (Grey-Simcoe):: Madam Speaker, I move, under the provisions of Standing Order 43, a motion of urgent and pressing necessity.
In view of the fact that drug and antibiotic residues in meat and meat products are responsible for causing severe illness, allergic reactions and even death to consumers allergic to specific drugs and antibiotics, I move, seconded by the hon. member for Winnipeg-Assiniboine (Mr. McKenzie):
That the Minister of Agriculture take immediate steps to eliminate the serious and dangerous health hazard emanating from abattoirs under federal inspection.


Madam Speaker:: Such a motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



FISHERIES


Mr. Lloyd R. Crouse (South Shore):: Madam Speaker, I rise, under the provisions of Standing Order 43, to move a motion of urgent and pressing necessity.
In view of the fact that Canadian workers in the fish processing industry will lose some 40,000 work hours and the Canadian economy will suffer a loss of more than $2 million as the result of planned over-the-side sales of 9,000 tonnes of mackerel and 3,500 tonnes of gaspereau alone this year to the Soviets, I move, seconded by the hon. member for Malpeque (Mr. Gass):
That no further contracts be arranged by the minister or his officials with Soviet interests for over-the-side sales guaranteeing them cash or increased allocations of fish quotas, without prior consultation with the president of the Seafood Workers' Union, representing 6,000 workers, the fishermen's representatives and the processors.


Madam Speaker:: Such a motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



INDIAN AFFAIRS


Mr. Laverne Lewycky (Dauphin):: Madam Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity.
In view of the fact that ten families are already withholding their children from attending school on the Sandy Bay Indian reserve, and in view of the fact that other parents are threatening to join them, considering that the present school has been condemned as a fire-trap since 1968, and since in January, 1979, Treasury Board had originally approved the construction of a new school, and since the Dakota Ojibway tribal council has also passed a resolution requesting the federal government to "immediately grant the Sandy Bay tribal council its new school and any efforts to further delay this vitally important issue be stopped immediately", I move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House instruct the Minister of Indian Affairs and Northern Development to immediately investigate the reason for the delay in construction of the said school, and that he ensure that his department not stall unduly the transmittal to Treasury Board of the Sandy Bay school project.


Madam Speaker:: Such a motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



CONSUMER AND CORPORATE AFFAIRS


Mr. Bill J. Yurko (Edmonton East):: Madam Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity.
Due to the hardship being experienced by wage and/or commission earners who are affected by bankruptcy and insolvency proceedings-for example, the employees of Parkway

May 1, 1980
Country Motors in Edmonton, Alberta-I move, seconded by the hon. member for Okanagan North (Mr. Dantzer):
That this House request the Minister of Consumer and Corporate Affairs to immediately revise subsection 265(4) and subsection 265(10) of Bill C-12, an act respecting bankruptcy and insolvency, in order to guarantee that the class of creditors set out in subsection 265(4)(e), namely, creditors with claims for wages, salaries, commissions and compensation for other services are given first priority over the payment of all other claims; and, furthermore, that this House expedite the passage of Bill C-12 so that wage earners whose back wages have been frozen because of bankruptcy can be paid.


Madam Speaker:: Such a motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.

O)



NORTHERN AFFAIRS


Mr. Doug Neil (Moose Jaw):: Madam Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity.
In view of the differential in the cost of fuel and electricity charged to residents in outlying settlements in the Northwest Territories and Yukon vis-a-vis Whitehorse and Yellowknife, I move, seconded by the hon. member for Prince George-Peace River (Mr. Oberle):
That this government implement the policy adopted by the previous government and approved by Treasury Board, namely, the equalization of fuel costs with those in Whitehorse and Yellowknife and the equalization of electrical rates for small business with those in Whitehorse and Yellowknife.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



BROADCASTING


Mr. Sid Parker (Kootenay East-Revelstoke):: Madam Speaker, I rise, under the provisions of Standing Order 43, on a matter of urgent and pressing necessity.
From Friday, April 25, until Wednesday, April 30, the production staff at Radio-Canada facilities in Quebec and New Brunswick were locked out by the corporation. As a result, all live broadcasts, including news, were severely curtailed. This action by Radio-Canada came after a conciliator's
proposal which the workers accepted, but which Radio-Canada rejected.
In light of the fact that the Quebec referendum is currently under way, making adequate news coverage even more vital for the citizens of Quebec, I move, seconded by the hon. member for Kamloops-Shuswap (Mr. Riis):
That this House instructs the Minister of Labour to actively intervene in this dispute, with the specific intent of persuading Radio-Canada to accept the conciliator's proposal and ending all further interruptions of service to the residents of Quebec and New Brunswick.


Madam Speaker:: Such a motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



AIR TRANSPORT


Hon. Warren Allmand (Notre-Dame-de-Grace):: Madam Speaker, I rise, under the provisions of Standing Order 43, to move a motion of urgent and pressing necessity.
Whereas it is estimated that in 1980 foreign air carriers, by stopping at Canadian airports, will take advantage of cheaper, subsidized Canadian fuel prices to record savings of approximately $101 million; whereas these savings are not being passed on to the passengers travelling from Canadian cities in the way of reduced fares, but are used to subsidize the costs of other world operations by these foreign carriers; and whereas the subsidies under the Canadian oil import compensation program were intended for Canadians and not for the large, foreign international airlines, many of which are state-owned; therefore I move, seconded by the hon. member for Davenport (Mr. Caccia)-and this might have the consensus of the House:
That the government examine this situation immediately and consider charging the world price for all fuel purchased by foreign carriers landing at Canadian aiports.


Some hon. Members:: Hear, hear!


Madam Speaker:: Such a motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Madam Speaker:: Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: Oh, oh!


Madam Speaker:: Moved by the hon. member for Notre-Dame-de-Grace (Mr. Allmand), seconded by the hon. member for Davenport (Mr. Caccia)-


Some hon. Members:: No.
May 1, 1980


Some hon. Members:: Oh, oh!


Madam Speaker:: Order, please.


An hon. Member:: Too late.


Mr. Baker (Nepean-Carleton):: A point of order, Madam Speaker-


Madam Speaker:: Order, please. I will ask the question again. Is there unanimous consent?


Some hon. Members:: No.


An hon. Member:: You can't do that.


An hon. Member:: Too late, Madam Speaker.


Madam Speaker:: The hon. member for Saskatoon-


Walter David Baker: A point of order, Madam Speaker.


Madam Speaker:: The hon. member for Nepean-Carleton (Mr. Baker).


Walter David Baker: Madam Speaker, I gather that what would rule in this case-


Some hon. Members:: Three o'clock.


Walter David Baker: -is your ear. I gather, from your intention to put the motion, that you did not hear a "no": in fact, you started to put the motion. I would think that is about the best evidence the House could possibly have of what your decision was with respect to what you heard.


Madam Speaker:: I asked the House twice if there was unanimous consent. There was a considerable amount of noise. When I started to read the motion I began to hear the "noes", so I put the question a third time. There were "noes". Therefore, I felt that there was not unanimous consent.


An hon. Member:: Unacceptable.



POST OFFICE


Hon. Ray Hnatyshyn (Saskatoon West):: Madam Speaker, I rise under the provisions of Standing Order 43. I am glad that the Postmaster General (Mr. Ouellet) is discussing matters with the hon. member for Saskatoon East (Mr. Ogle).
In view of the fact that widespread opposition has been registered to the Postmaster General on the move of the Saskatchewan district office from Saskatoon to Winnipeg, including from the mayor and members of city council of the city of Saskatoon, employees of the Post Office and members
Oral Questions
of Parliament representing Saskatoon and all Saskatchewan, and in view of the fact that the Postmaster General has neglected or refused to categorically revoke the planned move, notwithstanding serious questions of impairing the efficiency of the operation of the Post Office in Saskatchewan, I move, seconded by the hon. member for Moose Jaw (Mr. Neil):
That this House direct the Postmaster General to immediately make a statement in this House cancelling any plan to move the Saskatchewan district office and alleviate the deeply-felt apprehension that Saskatchewan views are not taken seriously by this government.


Madam Speaker:: Such a motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



AGRICULTURE


Mr. Len Gustafson (Assiniboia):: Madam Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43.
In view of the fact that farmers are now seeding and are under tremendous financial pressure, whereby 65 per cent of the farmers must borrow money from lending institutions to finance the planting of their crops, at the highest interest rates in the history of the country; and given the situation where the Canadian Wheat Board allows an over-delivery of quotas of 735 bushels for the purchase of seed grains, and where that quota is not used on a regular basis, 1 move, seconded by the hon. member for Portage-Marquette (Mr. Mayer):
That the government take the immediate steps to make it possible for farmers to use the extra quotas to purchase fertilizers and herbicides.


Madam Speaker:: Such a motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Hon. Bill Jarvis (Perth):: Madam Speaker, my question, which relates to oil pricing, is directed to the right hon. Prime Minister who indicated to the House yesterday that this

May 1, 1980
Oral Questions
government's oil price increase would be less than $4 a barrel this year.
Given the fact that the Minister of Finance, in his minibudget statement, indicated a $1 billion reduction this year in the oil import compensation payments, and given the second commitment by the Minister of Energy, Mines and Resources on April 16, when he stated that it was his intent to collect not less revenue this year from the new oil pricing agreement than would have been received under our December 11 budget, and given the fact that these ministerial commitments-the two of them in total-cannot be achieved under any formula without price increases in excess of $4 a barrel, has the Prime Minister asked both, or either, of his ministers to review or withdraw their respective commitments?


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, I do not agree at all with the premises of the question. We have discussed this and I am surprised that members opposite agree with the premises of the question.


Mr. Crosbie:: You are on the ropes, Pierre.


William Herbert Jarvis: Madam Speaker, if the Prime Minister does not agree with the premises, he questions the accuracy of Hansard. I direct his attention to those two days.
Does the Prime Minister recall that earlier this week his Minister of Energy refused to rule out a special oil levy, or special oil tax, at the refinery level which, of course, will be passed directly on to the Canadian consumer; and does the Prime Minister's commitment of less than $4 a barrel include any special levies or taxes imposed by the federal government on oil after it leaves the wellhead?


Pierre Elliott Trudeau: Madam Speaker, on the first part of the question, when I said that I did not agree with the premises, 1 was not agreeing with the hon. member's statement based on statements by the minister. It was a statement in the question of the questioner that this money cannot be raised without increasing prices beyond what the Conservatives did. That is the premise with which 1 do not agree, and that is something that will not be happening. That is the answer to the second part of the hon. member's question.
What 1 said was, rather than an increase of some 32 cents a gallon which was planned by his minister of finance and his government, we will have an increase of less than that. It will be an increase less by at least the 18 cents of the excise tax and of the other 14 cents which was the increase corresponding to a barrel at the wellhead. Our increase will be less than that.


Some hon. Members:: Hear, hear!


William Herbert Jarvis: Perhaps the Prime Minister failed to understand me. If I put the question badly, I apologize. I will rephrase it. The less than $4 a barrel commitment given yesterday, does that commitment include, as a matter of principle or as a matter of government policy, any special levies or taxes that are within his government's constitutional jurisdiction to
impose on oil, the handlers or consumers thereof, after it leaves the wellhead.
In other words, I want to know whether the $4 commitment includes a commitment that any additional taxes or levies will not result in a price in excess of $4 a barrel at the wellhead.


Walter David Baker: That is very clear.


Pierre Elliott Trudeau: It is not clear at all, Madam Speaker. I think I know what the hon. member is trying to ask, but it is certainly not clear from what he says that he knows what he is asking.


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: He wants to know, when we say our price will be less than $4 a barrel increase, if we will try to make up for that "less" by some other taxes elsewhere. The answer to that is "no".


Some hon. Members:: Hear, hear!


HONOURING OF COMMITMENT ON FUTURE PRICES OF OIL
Mr. Harvie Andre (Calgary Centre):: Madam Speaker, I have a supplementary question for the Prime Minister. Yesterday, the Prime Minister demonstrated his facility with arithmetic. Surely he must realize that the statement he has just made, the statement by the Minister of Finance regarding a billion dollar reduction in the import subsidy, and the statement by the Minister of Energy, Mines and Resources regarding the same "take" to the federal government as what they would have received from the December 11 budget, makes it impossible to honour the commitment of a $4 increase this year and $4.50 in each of the next three years. Will the Prime Minister have the honesty to admit that to the House and stop playing the shell game with Canadians?


Some hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Madam Speaker, that is not a question; it is a rhetorical argument. When the hon. member says it is impossible to do that, he is forgetting one thing, that the Tory budget and the pricing policies for oil of the former government was based on a principle which would sock the consumer. We are not going to sock the consumer.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: We believe that the companies themselves and the producers themselves have some contribution to make in this.


Harvie Andre: each of the next three years, and just by moving the date he is going to change it.
I have a question for the Minister of Finance-pardon me, the Minister of Energy, Mines and Resources, who said in the House on Tuesday that the government's decision to reduce the excise tax saved the Canadian consumer $2.6 billion. He also said in the House on April 16 that they intended to collect, from oil price increases, the same revenue that would have been collected under the December 11 budget. My question to the minister is, what kind of tax, levy or shell game is going to produce the $2.6 billion that is not going to have any impact on the consumer?


Hon. Marc Lalonde (Minister of Energy, Mines and Resources):: Madam Speaker, at the beginning of the question the hon. member indicated that he was asking it of the Minister of Finance.


Some hon. Members:: Oh, oh!


Harvie Andre: I will repeat the question, Madam Speaker. I then said "1 am sorry" to the Minister of Energy. The question to the Minister of Energy, Mines and Resources is this: On Tuesday, he indicated to the House that the decision of his government not to impose the excise tax resulted in a $2.6 billion saving to the Canadian consumer. But on April 16 he said in the House that he intends to collect as much revenue from oil price increases as the December 11 budget provided.
May I ask him by what tax levy or mysterious process he plans to produce that $2.6 billion for the federal treasury without an impact being felt by the consumer?


Marc Lalonde: I would invite the hon. member to show a little patience. When he sees the proposals the government is going to put forward, he will realize that they are, by a wide range, much more favourable to the consumer than the proposals put forward in the budget of the former minister of finance.


Some hon. Members:: Hear, hear!


INDUSTRY
Mr. Ian Deans (Hamilton Mountain):: Madam Speaker, 1 have a question for the Minister of Industry, Trade and Commerce. I am sure that everybody in the House, the minister included, is aware that the president of Chrysler, Mr. Iacocca, has publicly indicated that there will be no job guarantees in the agreement he is attempting to sign with the Canadian government, that there will be no engine plant in Windsor and no small size, world car built in Canada, and that they have just completed negotiations to sell off their Australian holdings to a Japanese company.
Oral Questions
Can the minister tell the House exactly what it is we are putting on the negotiating table in an effort to preserve for Canada that portion of the auto industry, and preserve for Canadian workers the jobs, which he long since promised would be preserved?


Hon. Herb Gray (Minister of Industry, Trade and Commerce):: Madam Speaker, I have been working to make sure that in this matter there is a fair deal for Canada.


Some hon. Members:: Hear, hear!


Herbert Eser (Herb) Gray: In this connection, Canadian jobs are, and have always been, a very important consideration. In spite of what the chairman of Chrysler Corporation said in Detroit yesterday, it is a fact that senior executives of his parent corporation and the Canadian company were negotiating with my officials throughout yesterday afternoon, yesterday evening and on into the night. They are meeting right now. I am determined, and the government is determined, that this matter will not come to an end in the absence of a fair deal for our country and for Canadian workers.


Some hon. Members:: Hear, hear!


Ian Deans: Since it is clear that all the matters which, according to the minister, ought to be contained within the agreement have been discarded by the chairman of Chrysler- there is to be no guarantee, no engine plant, no small car production-what is it that we are asking for in return for the $200 million guarantee he is prepared to put up?


Herbert Eser (Herb) Gray: The hon. member and the New Democratic Party seem ready to cave in to the Chrysler Corporation. We are not.


Some hon. Members:: Oh!


Herbert Eser (Herb) Gray: The Canadian people will be able to judge this matter in light of the total package we are able to negotiate in return for whatever kind and level of assistance the government provides.


PROPOSALS FOR MAINTAINING VIABLE AUTO INDUSTRY IN CANADA
Ian Deans: May I address my final supplementary to the Prime Minister? He will recall, as most of us do, that during the election, speaking in Windsor he indicated he was prepared to renegotiate the auto agreement with the United States. He made reference to the fact that there was a $3 billion deficit in the auto trade pact arrangement.
Can the Prime Minister indicate whether he has personally met with any of the Big Three leaders or all of the Big Three leaders, whether he is prepared to meet with them or whether he has asked for or obtained a letter of commitment for the production of parts, for research and development and for the

May 1, 1980
Oral Questions
manufacturing of vehicles which in fact might even sell on the North American continent?
Is there any indication from the Prime Minister on what he proposes might be done with the auto industry, given that Chrysler is not the only one that is ailing and that 25,000 people and their families in Ontario are not earning a living-


Madam Speaker:: Order, please.


Pierre Elliott Trudeau: Madam Speaker, I have not had any such meetings but, of course, the matter has been discussed many times in the cabinet. The minister responsible for trade has met not only with the people in charge of the auto industry but also with his counterparts in the American government, and they have agreed to discuss the auto pact with us.


DISTRIBUTION OF LOTO CANADA FUNDS TO ARTS AND SPORTS ORGANIZATIONS
Miss Pat Carney (Vancouver Centre):: Madam Speaker, I have a question for either the minister responsible for sports or the Secretary of State.
Since the provinces have given the federal government a $6.4 million cheque as its share of Loto Canada, and since the cheque remains uncashed-at an interest loss of about $3,000 a day-would either minister advise the House whether the government intends to cash the cheque and distribute the funds to arts and sports in the manner agreed upon by the previous government?


Hon. Gerald Regan (Minister of Labour):: Madam Speaker, I thank the lady member for this important question.


Mr. Epp:: The "member".


An hon. Member:: "Hon. member".


Mr. Nielsen:: Chauvinist.


Madam Speaker:: Order, please.


Some hon. Members:: Hear, hear!


Madam Speaker:: I think the minister could call her "the hon. member".


Some hon. Members:: Hear, hear!


Gerald Augustine Regan: Madam Speaker, I am quick to agree with your edict, but if we cannot call them ladies, I suppose we cannot call them gentlemen either.


Some hon. Members:: Hear, hear!


Gerald Augustine Regan: In answer to the question, may I say that having received from the provinces a cheque for just over $6 million, which was a certified cheque, and not wishing to cash it until
the legal position of the tentative agreement that the former government had attempted to make but had not, perhaps, completed with the provinces, was clear, we returned the certified cheque-because no interest runs with a certified cheque-to the provinces and received in return an uncertified cheque. This means that $3,000 a day is accruing to the interests of the ten provinces of this country. That is another piece of generosity by the benevolent federal government.


Some hon. Members:: Hear, hear!


FUNDING OF VANCOUVER ART GALLERY
Pat Carney: Madam Speaker, since the minister did not answer the question, and since the Liberals have demonstrated that they prefer deficit financing to certified cheques, I will direct my supplementary question to the Secretary of State.
Since some of these funds have been earmarked as the federal government's contribution to convert the old court house into Vancouver's art gallery, and since $5 million has been raised by private individuals in Vancouver-which depends on the federal funding-does the minister recommend that the Vancouver art gallery return these funds to the citizens of Vancouver because of an unwillingness on the part of the new government to allocate these funds to the appropriate ministries for their disbursement?


Hon. Francis Fox (Secretary of State and Minister of Communications):: Madam Speaker, I thank the hon. member for her question. I would like to point out to the hon. member that the capital project to which she is referring is, indeed, a campaign promise which was made during the course of the campaign by the previous government without allocating any specific funds to that project.
As soon as the issue concerning the distribution of Loto Canada funds is resolved, this government will be in a position to reassess the capital project requests which have come in from across the country, and we will at that time give all the consideration required to the project the hon. member has mentioned.


THE CONSTITUTION
Right Hon. Joe Clark (Leader of the Opposition):: Madam Speaker, my supplementary question is to the Prime Minister. I wonder if the Prime Minister could tell us if it is part of the renewed federalism of which he has spoken to reassert the federal claim over the field of lotteries.


Pierre Elliott Trudeau: Madam Speaker, that matter is under consideration and discussion.
May 1, 1980


RENEWED FEDERALISM-JURISDICTION OVER OFFSHORE RESOURCES
Charles Joseph Clark: Madam Speaker, 1 wonder if it is part of the renewed federalism of which the Prime Minister has spoken to deny the jurisdiction over offshore resources to the provinces.


Pierre Elliott Trudeau: That would not be renewed federalism, Madam Speaker; that would be a continuation of the kind of federalism practised by the right hon. Leader of the Opposition. I remind him that our government had signed with the maritime provinces an agreement as to the offshore. He broke that agreement in order to give them unilaterally to the provinces.
In the case of the lotteries, we had also reached an agreement with the provinces. He broke that agreement in order to give them unilaterally to the provinces.


Charles Joseph Clark: Madam Speaker, the Prime Minister has indicated that renewed federalism in at least these two instances involves the quickest possible return to the status quo.
Given the interest in Quebec and elsewhere in knowing what the contents of this renewed federalism of which the Prime Minister has spoken are, and since he has now indicated two areas in which he intends to move away from progress that was made, will he table in this House, before May 20, an indication of the contents of the renewed federalism that he and his government have in mind?


Pierre Elliott Trudeau: Madam Speaker, it seems to me that my previous answer made it clear that we had reached agreement with the provinces on these two matters. What the government of the right hon. Leader of the Opposition did was to cave in and to give to the provinces what had been negotiated away by them on an equal basis with the federal government. Now I am telling him that if his view of renewed federalism is to undo all the agreements which are fair for both the federal government and provincial governments, and replace them by agreements which will be fair only for the provinces, that is not our view of renewed federalism.


NATIONAL DEFENCE
Hon. Allan B. McKinnon (Victoria):: Madam Speaker, my question is for the Minister of National Defence. I wonder if the minister could announce the two winners of the competition for the design of the Canadian patrol frigate, thus enabling the navy to proceed to the contract definition phase and enabling the three consortia which did not win the competition to cut their losses and not incur further useless expenses.
Oral Questions


Hon. J. Gilles Lamontagne (Minister of National Defence):: Madam Speaker, I can assure the hon. member that nothing is unduly delaying the normal progress of the frigate file. I have not yet received any specific suggestion concerning companies having the required qualifications to undertake the design of the new frigates. The only statement I have made so far is that the new frigates would be built in Canada with a Canadian design.


Allan Bruce McKinnon: Madam Speaker, the minister is not quite as specific as he was last Friday about where they would be built, when he illustrated political patronage was his prime factor in awarding the contracts.
Last November, as minister of national defence I sent a memo to the chief of the defence staff and the deputy minister ordering a study to be started on a new ship replacement program to follow on after the six frigate program was finished. An interim report was to be given to the chief of the defence staff by March 15 and to the minister by the end of June. Can the minister tell the House what progress, if any, has been made on this study, and if he has been briefed on it by the chief of the defence staff?


Mr. Lamontagne:: Madam Speaker, following my previous answer, the development of the frigate program follows its normal course and once the problem of the new fighters was settled I asked the department to do its utmost to suggest all possible solutions on the frigates.


NATIONAL UNITY
Mr. Jean-Guy Dubois (Lotbiniere):: Madam Speaker, my question is directed to the Minister of Justice. Following the scathing criticism made this morning by PQ minister Pierre-Marc Johnson about the publicity of the federal government, does the Minister of Justice intend to put a stop to the information activities of the Canadian government in Quebec?


Hon. Jean Chretien (Minister of Justice and Minister of State for Social Development):: Madam Speaker, I do not intend to stop the publicity. I merely want to thank Mr. Johnson for having acknowledged the suitability and effectiveness of the Canadian government information program. I wish to take this opportunity to remind Mr. Johnson of a statement made on March 31, 1980, before the National Assembly by Premier Levesque, and I quote:
It is normal for governments, if they have some sense of reality, to try, as corporations do, to obtain some information on the occasion of publicity-

May 1, 1980
Oral Questions


Madam Speaker:: Order. Could the minister answer more briefly and refrain from reading long quotations.


Joseph Jacques Jean Chrétien: Madam Speaker, I very rarely abuse the rules and I have almost finished:
If it is related to the referendum, I would say "Good!" and I suppose you would say "Too bad!". However, this is in a context which is-


Madam Speaker:: Order. The hon. member for Vancouver-Kingsway.


NATIONAL ENERGY BOARD APPROVAL OF NATURAL GAS
Mr. Ian Waddell (Vancouver-Kingsway):: Madam Speaker, I have a question for the Minister of Energy, Mines and Resources. Perhaps I can call him what Vancouver journalists called him, "the charming minister, the charming member".


Some hon. Members:: Hear, hear!


Ian Gardiner Waddell: He will need all his charm. Yesterday, the National Energy Board approved the export of enough natural gas to finance prebuilding the southern portions of the Alaska Highway gas pipeline, thereby making a complete farce of its own hearings on the prebuild.
My question is this: In view of the fact that the National Energy Board has obviously prejudged the issue, can the minister assure the House that he will stand by his own position of last December 6 when he stated in the House that such exports would amount to-and I use his words-"the greatest sellout in Canadian history"?


Marc Lalonde: Madam Speaker, I would refer the hon. member to a press release which I issued yesterday following the statement by the National Energy Board, in which I indicated that this report by the Energy Board "did not imply that the government was now prepared to approve new gas exports". This matter will be decided by cabinet-


Ramon John Hnatyshyn: When?


Marc Lalonde: In due time, after we have had further consideration of this whole issue. More particularly, the "key factor in the ultimate decision will be the status of the Alaska sections of the pipeline". This is all in the press release which was issued yesterday, and we stand by the position we have taken.


Ian Gardiner Waddell: Madam Speaker, I have a supplementary question. The Minister also said to the press yesterday, and I will use his words, that "Canada was taking every step possible to pave the way for prebuilding the project". Senator Olson,
who is also responsible in this matter, has approved equipment purchases for the project. On April 21, in Calgary, he said that he expected legislative authority or legislation in this House within the next three to five weeks, and in the Senate yesterday he said that he was prepared to agree to the prebuilding, this summer, of a portion of the project.
My supplementary question is this, first of all: Who is right? Has the minister made a decision, or not? Is Senator Olson right, or is the minister right? Further, did Senator Olson's statements mean that the Government of Canada has received assurances from the government of the United States that the whole Alaskan gas pipeline can be built?


Marc Lalonde: Madam Speaker, I am afraid that the hon. member is trying to introduce confusion where there is none. When he quoted that excerpt from my press release, he could have gone on to read as follows:
-Canada was taking every possible step to pave the way for prebuilding the southern sections, and that it was now incumbent on the United States to do the same by demonstrating that the northern sections of the pipeline and the entire project would be completed in an expeditious and timely manner.
This is the position of this government and all ministers of this government.

[ Translation]


THE CONSTITUTION
Hon. Roch La Salle (Joliette):: Madam Speaker, my question is directed to the right hon. Prime Minister. Like many other Canadians, he is surely aware of the attitude of several of his provincial counterparts with regard to the status quo or sovereignty, because rejection of both options manifests itself in the same way. In the context of his new federalism, is the right hon. Prime Minister in a position to say, with a view to throwing some light on the subject for thousands of Canadians, whether that attitude goes to the point of intending to submit the draft of a new constitution to the provinces?


Pierre Elliott Trudeau: If it could induce the hon. member for Joliette into joining the No forces,
I should be tempted to say yes.


Roch La Salle: Madam Speaker, you will understand that it is clearly not enough to convince those who are tempted to vote yes at the present time, to hear the right hon. Prime Minister refuse to throw some light on the matter. It is obvious the premiers-and they are people with responsibilities-want a meeting to be convened shortly after the referendum, regardless of its results. It is obvious that the federal government will also have to discuss the matter with the Quebec government. Can the right hon. Prime Minister say whether he intends to submit the draft of a new constitution, which would be of
May 1, 1980

interest in any event at least to those who might be tempted to vote no? But the right hon. Prime Minister should not be surprised if his new federalism is found lacking, and undeserving of trust after the experience of the past 12 years.


Pierre Elliott Trudeau: Madam Speaker, the government has made two proposals for a new constitution to the House. It did so in June of 1978 when we tabled the white paper entitled "A Time for Action". We also tabled a bill, namely Bill C-60. A report was also prepared at the request of the government, that of the royal commission of inquiry chaired by Messrs. Pepin and Robarts. A royal commission of inquiry was also set up by the federal government, that of Mr. Pearson, namely the Lauren-deau-Dunton commission. So the hon. member should not forget that this government and former governments of Liberal allegiance have made several proposals on a renewed federalism. What he seems to forget, Madam Speaker, is that when Premier Levesque came he always refused to discuss the proposals saying they were "too little". That was his way of ensuring that the status quo be maintained because, as we know, what he wants is independence. The hon. member should also know that.
* *
*


AIRPORTS
Mr. Geoff Scott (Hamilton-Wentworth):: Madame le President, on Monday the Minister of Transport said that the government would honour the Conservative administration's $45 million commitment to expand the Hamilton civic airport at Mount Hope, and then he added "if it makes sense". The hon. member for Hamilton East said the following on January 25:
-$45 million would provide facilities that are primitive at best; the Liberals stand by their commitment to spend $ 100 million to upgrade the airport.
In view of that campaign statement by his colleague, I ask the Minister of Transport if those gentlemen have their act together yet. If $45 million may not make sense, can we take from that that the government intends to honour its $100 million campaign promise?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, my information is that the previous Liberal government never made a promise of giving $100 million to this project.


Some hon. Members:: Oh, oh!


An hon. Member:: Your colleague did.


Jean-Luc Pepin: No, sir. My information is that the immediate previous government-theirs-simply passed a resolution in cabinet expressing the wish, the desire, the intention or the principle of allowing $45 million for this project.
Oral Questions
I suggest to you. Madam Speaker, very simply that the assessment of what is needed to be done at that airport is not completed yet. This is what is taking place now on the ground side as well as on the air side. When this is done, we will assess what needs to be done and direct the necessary funds to do it.


AIR CANADA
Mr. Bill Kempling (Burlington):: Madam Speaker, I have a supplementary question which is directed to the Minister of Transport. Air Canada opened an office in downtown Hamilton a few months ago, and a senior official at that opening said Air Canada would be offering a service out of Hamilton once the new airport facilities were arranged at Mount Hope.
1 want to ask the minister what effect this will have on Nordair. What effect will it have on the purchase offers which have been tendered to the government for the Nordair shares held by Air Canada on behalf of the government?


Jean-Luc Pepin: No effect at all, Madam Speaker. This is a different question entirely. My department is trying to make sure that Nordair will stay there and will continue to operate from that airport. There are ideas being expressed there are possibilities that Air Canada might also operate from that airport, on other routes, obviously. This is what is being assessed now. It is a bit of a vicious circle, as usual-one wants to know what the traffic will be in order to find out what kind of terminal one needs.


Erik Nielsen: Like Pickering.


Jean-Luc Pepin: So we have to break through this vicious circle, and we are working on that at the moment.


FINANCE
Mr. Bob Ogle (Saskatoon East):: Madam Speaker, 1 had hoped to address my question to the Minister of Finance, but I see that he has left the chamber. Therefore, I will address it to the Secretary of State for External Affairs.
The Deputy Prime Minister and Minister of Finance is well known for his activities and interest in the north-south dialogue, the discussions that go on between the rich and the poor countries today which are even more important because the staggering differences become more clearly visible: for example, 800 million people are now living in destitution and 30 million children die each year from starvation.

May 1, 1980
Oral Questions
I would like to ask the Secretary of State for External Affairs whether he has had an opportunity to discuss with the Deputy Prime Minister and Minister of Finance the meeting that was held last week in Europe of the International Monetary Fund. Also, can he indicate what was the result of that meeting in relation to the problems of north-south countries, particularly countries like Jamaica which are staggering under the debt load that the world currency crisis now causes?


Hon. Mark MacGuigan (Secretary of State for External Affairs):: Madam Speaker, I have not yet had a report on that particular meeting from the Deputy Prime Minister and Minister of Finance, but the whole subject of north-south dialogue and all the related concerns which the Deputy Prime Minister, and Minister of Finance, and other members of the government have been so aware of in recent years, are very much before the government.
There is a special session of the United Nations dealing with this problem this year, and I can assure the hon. member that this is one of our foremost concerns in international affairs.


Robert Joseph Ogle: Madam Speaker, in the recent report of the Independent Commission on International Development Issues, former West German Chancellor Willy Brandt asked that governments bring the subject of north-south disparities before their parliaments as a matter of the utmost urgency.
Is the minister ready to advance this debate in the House at this time, so that Canada, instead of just joining in the heightening of international tensions could be a forerunner in responding to global development needs, which are not a side issue but a matter of survival today?


Mark R. MacGuigan: Madam Speaker, as the House knows, the government has already taken the initiative of establishing a task force in this particular area and, of course, these issues will be before the parliamentary committee and also before the House in due course.


THE ADMINISTRATION
Mr. F. Oberle (Prince George-Peace River):: Madam Speaker, my question is for the Prime Minister. It is in respect of the rumour that has been circulated that nine government ministers are embarking upon a mission to that land beyond the Rockies called British Columbia.
Could the Prime Minister tell the House the specific objectives this mission is to accomplish? Also, will he give us an indication of the message this mission is to convey, so that we who come from this strange land can prepare a climate of hospitality with which such important delegations are usually received, and in order that the mission will not end up as a "mission impossible"?


Pierre Elliott Trudeau: Madam Speaker, I am surprised that the hon. member calls British Columbia a strange land. It is a very beautiful land and a very integral part of Canada.


Some hon. Members:: Hear, hear!


Pierre Elliott Trudeau: I am also surprised that he feels this matter coming up is the subject of rumours. If he had been tied into his constituency he would know that the government of British Columbia has been seeking a meeting with our government for many weeks now. Unfortunately, we have been unable to take enough ministers out west to go to that meeting, but fortunately on the occasion of the visit of the Prime Minister of Japan we have planned parts of the discussions in British Columbia with the Japanese Prime Minister. On that occasion we will have several federal ministers in British Columbia dealing with their counterparts on many subjects of mutual concern.


Frank Oberle: Madam Speaker, in that context, maybe the Prime Minister could undertake to put members on this side of the House on the mailing list of the political minister who sits in th other House and who, indeed, organized and co-ordinated the mission with those who are to receive it out there.
Could the Prime Minister, specifically, say whether the ministers are prepared to discuss such things as the port of Prince Rupert and agreements with the British Columbia Railway regarding hopper cars, particularly since the Minister of Transport is one of the ministers going out there? More specifically, will they be prepared to discuss some of the commitments made by the former government, and is the mission prepared to reaffirm and underline those commitments again?


Pierre Elliott Trudeau: Madam Speaker, I will be happy to accede to the request of the hon. member. I am sure that he is on the mailing list of this government. I think we do everything we can to keep members opposite in touch with their constituents.


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: On the subject matters of the discussions, Madam Speaker, there is a very full agenda put together bilaterally by the government of British Columbia and ourselves.


JURISDICTION OVER OFFSHORE OIL
Hon. James A. McGrath (St. John's East):: Madam Speaker, in the absence of the Minister of Energy, Mines and Resources I will ask my question of the Prime Minister.
A few days ago the government of Newfoundland, through its spokesman, the minister of energy, indicated it had received no communication from this government of Canada as to its position regarding the dispute with Newfoundland over the
May 1, 1980

jurisdiction of offshore oil. I would ask the Prime Minister whether it is still the position of his government to refer this matter to the Supreme Court of Canada and, if so, when will such reference be made?


Pierre Elliott Trudeau: Madam Speaker, I cannot speak on the statements of the Newfoundland minister, but this government has made very clear what our position was, and is. It is twofold: it is that if proprietory rights have to be decided, they should be decided by the Supreme Court of Canada and not by any unilateral action either of the provincial government or of the federal government.
I think the hon. member would agree with that, that only the Supreme Court of Canada can decide, in the final instance, what the constitution says about ownership offshore. I regret, in that regard, that we have not been able to get from the province of British Columbia consent to a joint-


An hon. Member:: Newfoundland.


Pierre Elliott Trudeau: Newfoundland, consent to a joint-


An hon. Member:: It is on the other coast.


Charles Joseph Clark: There are three coasts, the Atlantic, the Pacific, and the Arctic.


Pierre Elliott Trudeau: 1 know, Mr. Clark, but 1 don't lose my luggage when 1 go to one coast.


Some hon. Members:: Oh, oh!


An hon. Member:: What about John Munro?


Some hon. Members:: Oh, oh!


An hon. Member:: You lost B.C., and you lost a minister.


Madam Speaker:: Order.


Pierre Elliott Trudeau: Madam Speaker, as to the second part of our policy, it is to state again to Newfoundland what we have stated many times before, that if it wants to set aside the question of ownership and work out an administrative arrangement which will be advantageous to the province in money terms and in administrative terms, it just has to look at the agreement that was signed a few years ago by the three maritime provinces.
We are prepared to set aside any discussion of ownership to reach an agreement which would be advantageous to the people of Newfoundland in money and in administrative terms.


Some hon. Members:: Hear, hear!


James Aloysius McGrath: Madam Speaker, the Prime Minister knows that the agreement with the maritimes is not acceptable to Newfoundland. The Newfoundland government has also indicated that if this matter is not resolved to its satisfaction, even if it is referred to the Supreme Court during that period,
Oral Questions
it is prepared to use the powers it already has to hold up production of the very important Hibernia well which is now commercially viable.
My question to the Prime Minister is: In view of the fact that the Newfoundland government indicated in a statement this week that it is prepared to negotiate, and in view of the position it has taken regarding its difference of opinion with the federal government-that is, to hold up production if there is not settlement-is the Prime Minister and is the Government of Canada prepared to accept the good will expressed by the Newfoundland government and immediately sit down and negotiate?


Pierre Elliott Trudeau: Madam Speaker, would the hon. member mind clarifying his statement about holding up production? I did not understand what that reference was.


James Aloysius McGrath: Yes, Madam Speaker, I would be glad to. I am referring to a statement made on Monday by the minister of energy and mines for the province of Newfoundland, in which he stated that the Newfoundland government was prepared to use the powers it already has to hold up commercial production of the Hibernia well until this matter-that is, the dispute with this government-is resolved to its satisfaction.
I say that is a very important new development. In view of that very important new development, and in view of the importance of the potential of the Hibernia well to eastern Canada, will the Prime Minister at least order his Minister of Energy, Mines and Resources to immediately sit down and negotiate with the Newfoundland government?


Pierre Elliott Trudeau: Madam Speaker, it does not seem to me that the context quoted by the hon. member is very conducive to fruitful negotiations. If the minister of the Newfoundland government is stating that unilaterally they will take measures to hold up production of something over which their ownership is not established, I would hope that the minister of Newfoundland would reconsider his position.


NUCLEAR ENERGY
Ramon John Hnatyshyn: Madam Speaker, I had a question for the Minister of Energy, Mines and Resources, but I see he is not present; therefore, I would like to direct it to the Prime Minister.
Our government initiated a national inquiry into domestic and international nuclear policy in Canada. Is it the intention of the Prime Minister to reconvene that national inquiry so that Canadians may have an input and there can be an assessment with respect to the direction of our national nuclear policy?
606

May 1, 1980
Oral Questions


Mr. Roy MacLaren (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Madam Speaker, there is no intention at the moment to begin a public inquiry of the type the hon. member has raised but, rather, to pursue an internal review as the Minister of Energy, Mines and Resources announced a few days ago.


Ramon John Hnatyshyn: Madam Speaker, that announcement will come as a very great disappointment to literally hundreds of thousands of Canadians who feel they should have an opportunity to present their views on this very serious and important question.
My question to the parliamentary secretary, in view of the fact that he is answering on behalf of the minister, is: Will he be able to table as soon as possible the terms of reference with respect to an internal inquiry, and will the minister be in a position to let us know precisely the nature of that inquiry? Will the inquiry be open, and will the people of Canada have an opportunity to participate, whatever form it may take?


Pierre Elliott Trudeau: Madam Speaker, I was involved in the discussions of this matter with the parliamentary secretary and the minister. On behalf of the government, I would like to explain why we are not at this time organizing a public inquiry: it is because the time schedule for keeping our industry viable is very, very short.
We are now in danger of seeing the Canadian industry become obsolete and lose its chance to sell in other countries of the world unless we make some quick decisions on some basic questions. It is in order to get these quick decisions that we in the government want to establish our own policy in a firm way.
There is no intention of preventing the Canadian public, concurrently or subsequently, from participating in various ways and expressing their views, but we cannot wait for a long inquiry to decide whether we stay in the game or get out of the game. That is the essence of the situation.


Ramon John Hnatyshyn: That is not the question. Shameful.


NATIONAL DEFENCE
Mr. Ray Skelly (Comox-Powell River):: Madam Speaker, 1 direct my question to the Minister of National Defence. It is based on the remarks which he made in the House last Friday.
Could the minister explain why he is discriminating against industry in western Canada and in Atlantic Canada in defence procurement contracts? Could he also explain why work on the F-18 which was earmarked for British Columbia was moved from that area to central Canada, and why he committed in this House last Friday the work associated with the frigate program to Quebec without offering a fair share to the people of British Columbia and Atlantic Canada? Also, why has the minister not made available full details and fair opportunities
on the new truck acquisition, choosing to make vague promises to the province of Quebec, rather than outlining how such a contract of defence procurement could help the government's national industrial strategy?


J. Gilles Lamontagne: Madam Speaker, I think the question put by the hon. member of the New Democratic Party is rather lengthy and would take some time to answer, but I can say this, in general: when we are discussing various contracts and supplies for the Department of National Defence, we take into consideration the basic principle of the Canadian confederation, namely, the equitable distribution of the economic impact throughout Canada-that means all provinces, including Quebec, British Columbia and Ontario. That is the principle we apply when giving out the various contracts we must award.


PRIVILEGE
Madam Speaker:: Yesterday, the hon. Minister of State for Science and Technology and Minister of the Environment (Mr. Roberts) questioned the language used by the hon. member for Vancouver South (Mr. Fraser). I indicated that 1 would check Hansard. 1 had said that I had not heard the hon. member for Vancouver South say anything which seemed to me to be unparliamentary. I have checked Hansard and found that the statement of the hon. member for Vancouver South was as follows:
They have completely circumvented the right of the hon. member for Peterborough to raise that matter in this House on behalf of his constituents and receive an honest answer from a government which, in this case, is not only acting dishonestly, but shabbily.
The words which presented the difficulty are not directed to individual members of the House but, rather, to the government. I must rule as my predecessors, that such words directed to the government collectively are not unparliamentary.


MR. WADDELL-COMPOSITION OF CANADA-UNITED STATES INTERPARLIAMENTARY DELEGATION
Ian Gardiner Waddell: Madam Speaker, I rise on a question of privilege. On May 23, which will be coming up shortly, the Canadian-United States interparliamentary group will be going to San Diego for a conference. With respect to this conference, there are only two members of the New Democratic Party who are able to go.


Some hon. Members:: Oh, oh!


Ian Gardiner Waddell: They are the environment critic and the finance critic. The seminars which are being held at the
May 1, 1980

conference-and I have examined the itinerary in some detail-involve the environment, Canadian-American relations; finance, Canadian-American relations; and energy, Canadian-American relations. As the energy critic for our party, I am not invited to attend, even though very important questions came up in the House today.
The delegation consists of seven senators and they are going by chartered jet from here to the conference. It seems to me that this is a great cost to the Canadian taxpayers because we as members have the privilege of an allotted number of flights. This delegation could fly to the west coast and take another flight from there.
As a member of the House of Commons, I object because this infringes on my privileges as a member and because, instead of a proper delegation representing Canada, it is a delegation, as 1 have said, of senators who do not do anything with respect to-


Some hon. Members:: Oh, oh!


Ian Gardiner Waddell: -these matters and they have no responsibilities. I am raising a serious matter of privilege, Madam Speaker.


Some hon. Members:: Oh, oh!


Ian Gardiner Waddell: I note that members of the Liberal party and the Conservative party are prepared not only to subsidize these senators to enable them to attend, but to fly them there in a chartered jet. 1 think that it is a shame for the Canadian taxpayer and that it infringes on my privileges as a member of the House of Commons.


Walter David Baker: There is not a dry eye in the House, Madam Speaker.


Madam Speaker:: 1 am not quite sure whether 1 can accept the question of privilege raised by the hon. member. It seems to me that the formation of delegations to meetings of interparliamentary associations is a matter that is dealt with among the members, and I am sure that the New Democratic Party had a representative at the meeting when that particular delegation was decided upon. I suppose that the hon. member is entitled to raise some complaint in the House, but I am not sure that it should be addressed to the House.
Would the hon. member please address himself, rather than to the House, to the whips or committees which have the responsibility of forming these delegations. The hon. member for Nepean-Carleton (Mr. Baker).


Ian Gardiner Waddell: Madam Speaker, 1 understand that-


Some hon. Members:: Order.


Madam Speaker:: I have given the floor to the hon. member
for Nepean-Carleton.
Business of the House BUSINESS OF THE HOUSE


WEEKLY STATEMENT
Walter David Baker: Madam Speaker, I was worried that the government House leader would not hear me over the din coming from the end of the chamber. 1 wonder if 1 could ask the House business question today. Could the President of the Privy Council give us some indication what we will be dealing with later this week and, if possible, into next week?
[ Translation]


Mr. Pinard:: Madam Speaker, as was announced yesterday we will proceed today with the consideration of the bill to revise the Bank Act. We will interrupt it tomorrow to study legislation to promote public safety in the transportation of dangerous goods and, if possible, legislation to implement the International Convention for Safe Containers, that is Bills C-18 and C-21. Next Monday, as all members know, the Prime Minister of Japan will address Parliament in this House. Question period will therefore begin at 4.30, following which we will resume consideration of the bank legislation. 1 hope that by the end of next week we will be able to complete our consideration of bills on the Small Businesses Loans Act, the Employment Tax Credit Act and the Federal Business Development Bank Act.
I also intend to allot an opposition day next week. I will specify the exact day later on after consultation with the House leaders of both opposition parties, but there will definitely be an opposition day next week.


Walter David Baker: Madam Speaker, I want to thank the President of the Privy Council for that information. A couple of questions arise with respect to House business. The first is the continuation of the throne speech debate. Now that we are consider allotted days, would the minister consider finishing off the throne speech debate? A number of members want to speak. I am particularly interested in hearing a speech to be made by the hon. member for Joliette and I know that others in the House want to have the opportunity to make a contribution.
The other matter has to do with the question of allotted days. In the past, a practice has been developed whereby a schedule of allotted days might be submitted to the leader of the government for discussion. If that is agreeable to him, I will be glad to prepare a schedule.
Last week I asked the minister about the possibility of a reference that would permit the parliamentary delegations that go out across the country-and indeed across the world from time to time-to report to the appropriate standing committee. Has the minister considered that? Perhaps he has not had time to do so but I would appreciate it if he would. I undertake that there would be no debate with respect to this matter.

May 1, 1980
Business of the House


Mr. Knowles (Winnipeg North Centre):: Madam Speaker, my question is supplementary to the one about House business. We have had some discussion about certain matters that might be referred to committees. I wonder if the government House leader would consider a reference to a committee, whether standing or special, of the report of the Canadian Human Rights Commission? As he knows, there are some pretty important recommendations in that report and it seems to some of us that it should be considered.
May i also ask him, following the questions asked earlier today by the hon. member for Saskatoon East, whether consideration could be given to a day's debate on the north-south situation as recommended by Willi Brandt to all independent parliaments.


Yvon Pinard: Madam Speaker, first of all I should like to reply to the three questions which the House leader of the official opposition has asked. We have interrupted the throne speech debate to have more time to deal with bills which have accumulated because of the two elections we have had within a year. My hon. colleague is well aware that this week, thanks to the co-operation of all parties in the House, we have come to an agreement to dispose of the supply bills, which is already a giant step.
On the other hand, there are several bills which are urgent and must be adopted by June 30. That is why I cannot confirm to my colleague that we shall resume and complete the throne speech debate before the end of June. This remains a possibility, although highly improbable, because of the accumulated legislation we must deal with. If everything goes well and if all parties continue to co-operate the way they have this week, we might complete the throne speech debate before our summer recess and hopefully before September 1.
As to the hon. member's second question concerning the allotted days-


An hon. Member:: September 1 ?


Yvon Pinard: Yes, I said September 1, and I hope it will be earlier.
As to the allotted days, I fully agree with my hon. colleague. I have asked my officials to set a number of dates which they will discuss with the House leaders of the other parties. We shall then try to come to an agreement on these dates before the summer recess, if there is one.
The hon. member raised a third question, namely: Should the reports of our foreign delegations be referred to House committees?
I think I mentioned before that that is a suggestion we will take into consideration. We have not decided anything in that regard. We shall have to decide whether consultations will take place and we shall also consult members of the New
Democratic Party. If a decision is reached, I assure my colleague we shall inform him in due course.
In his first question the hon. member for Winnipeg North Centre inquired about a committee on the Human Rights Commission report. This is an excellent suggestion worth considering and I shall report to him on it as soon as possible.
We must also keep in mind that the committees are already quite busy with the consideration of the main estimates. We are studying the possibility of striking a special committee to which would be referred the reports of the Commissioner of Official Languages. There should be an agreement on that matter soon. I would say offhand his suggestion is a positive one. I would not commit myself today but I shall give it serious consideration.
The same can be said about his last suggestion of a one-day debate on north-south relations. It is interesting and I shall make our position known about it without delay.


Walter David Baker: Madam Speaker, the reference of the hon. gentleman with respect to the joint committee on the Official Languages Act brought to mind something that I wanted to convey to him so I take the opportunity of doing it now. If he would put down that reference, we are prepared to have it go to a joint committee without debate in order to save time.


Stanley Howard Knowles: Madam Speaker, I wonder if a decision on that might be delayed for an hour or two. I had said that we would be willing to agree to that being put, with a limitation of one speaker per party. Now the suggestion comes that there be no speakers. I should like the opportunity to consult and perhaps we can come to an understanding later this afternoon.


Walter David Baker: All right.


PRIVILEGE
Hon. Ed Lumley (Minister of State, Trade):: Madam Speaker, I rise on a question of privilege as a result of a debate which took place in the House yesterday when a question of privilege was raised by the hon. member for Peterborough (Mr. Domm) and in which the hon. member for Vancouver South (Mr. Fraser) joined. Several statements were attributed to me, Madam Speaker, which unfortunately are not correct.
The hon. member for Peterborough stated as reported on page 572 of Hansard:
The hon. member for Stormont-Dundas (Mr. Lumley) advised the media the day after that he and the minister-
May 1, 1980

Meaning my colleague, the hon. Minister of the Environment (Mr. Roberts), who is responsible for Parks Canada.
-thought the same.
That statement is totally incorrect, Madam Speaker.


Madam Speaker:: Order, please. I am sorry to have to interrupt the hon. minister but I made a ruling on that question of privilege yesterday. I would have needed notice in order to entertain the remarks that the hon. minister has to make.


POINT OF ORDER
Mr. Svend J. Robinson (Burnaby):: Madam Speaker, my point of order is with respect to the appointments to be made by this House to the joint parliamentary committees of the other place and the House of Commons. I am concerned members of the other place have for some time now had their nominations put forward for those committees and that this House has not taken any action to appoint our nominees.
There are a couple of committees which we are particularly concerned about, including the Joint Committee on Regulations and Other Statutory Instruments which has a very heavy work load and which should be getting under way in the very near future. 1 have requested on several occasions the Parliamentary Secretary to the President of the Privy Council (Mr. Collenette) to take this matter in hand and 1 have received yet another note that the matter is possibly going to be dealt with next week. I would hope that we could deal with some dispatch with this important question.


Mr. D. M. Collenette (Parliamentary Secretary to President of Privy Council):: Madam Speaker, it is correct that I did inform the hon. member today that we hoped within the next week to make nominations from the House of Commons to these special joint committees and I would ask for the hon. member's patience. There has been a lot of work going on in the last week or so in the organizing of the House. It is not our intention to delay, and we hope within the next week that everything will be sorted out.
Veterans Affairs



ROUTINE PROCEEDINGS


Yvon Pinard: Madam Speaker, as the right hon. Prime Minister (Mr. Trudeau) undertook to this House a fortnight ago, I should like to table in his name, in accordance with the provisions of Standing Order 41(2), copies in both official languages of correspondence which the Prime Minister has sent to all ministers and parliamentary secretaries concerning this government's conflict of interest guidelines.


VETERANS AFFAIRS
Hon. Daniel J. MacDonald (Minister of Veterans Affairs):: Madam Speaker, I would like to remind hon. members that May 5 is the thirty-fifth anniversary of the liberation of Holland. Those five dark years of oppression through the Second World War came to an end for that country, but at the cost of thousands of Canadian lives.
I shall lead an official delegation to The Netherlands from May 2 to 9. This delegation will include four senior Second World War Canadian military commanders and representatives of the Royal Canadian Legion and National Council of Veterans Associations. 1 will also have with me two members of the Senate, two members of the House of Commons and one winner of the Victoria Cross, the Commonwealth's highest decoration for gallantry during the liberation. We will renew the bonds of friendship and respect which have linked the Dutch and Canadian people for well over a generation. We will also share with our Dutch friends deep feelings of sadness for the more than 7,000 young Canadian servicemen who died in that struggle of 35 years ago and now rest in Dutch soil.
The passing years cannot erase in our minds the memory of those gallant men who paid, with their lives, the cost of those great ideals which our countries have come to share and stand for: democracy, freedom and justice.
We can find comfort in the knowledge that Canada's sacrifice from every province of our country and that of thousands of Dutch people during those years was not in vain. The people of Holland rose from the ashes of their war-devastated country to great heights of renewed nationhood. Since that time, 35 years ago, Holland and Canada have enjoyed a fruitful, rewarding relationship, a relationship which will continue to blossom just as The Netherlands Royal Family's annual gift of tulips does here in Ottawa each year around this time.
The links and memories that unite us are strong. We will ensure that they are never allowed to fade. We must also be vigilant to see that the ideals for which Canada fought, and

May 1, 1980
Veterans Affairs
preserved, are not lost but always held high. We will continue to maintain a vigilant guard over the legacy which thousands of Canadians have bequeathed to us on the battlefields of northwest Europe.


Some hon. Members:: Hear, hear!


Mr. Dan McKenzie (Winnipeg-Assiniboine):: Madam Speaker, 1 welcome the opportunity to join with the Minister of Veterans Affairs (Mr. MacDonald) in remembering the thirty-fifth anniversary of the liberation of Holland. I am sure the minister and his party will receive a very warm welcome.
I should also like to mention the great care and dedication that the Dutch have demonstrated in the maintenance of the graves of those 7,000 young Canadians buried in their soil. Canadian families visiting Holland have always commented on the sympathetic understanding of the people of Holland in this regard.
As the minister so correctly pointed out, our two countries have come to share a stand for democracy, freedom and justice. However, 1 feel we in this country have been somewhat remiss in our attention to the justice we have meted out to our veterans who returned to Canada. To this end 1 would call upon the minister to use this occasion to reintroduce the former Bill C-28, the Progressive Conservative legislation of the last Parliament which took the first step in measuring out some of the justice to which the minister now refers. Had a spirit of justice existed in this House when the former minister introduced Bill C-28, the opposition parties would have adopted the attitude of co-operation necessary to get this legislation through.
I congratulate the minister on the recognition he is giving this thirty-fifth anniversary of the liberation of Holland and call on him to provide some economic liberation to veterans and widows of veterans in Canada.


Some hon. Members:: Hear, hear!


Stanley Howard Knowles: Madam Speaker, my colleagues and I also feel that it is appropriate for us to recall that day, May 5, 1945, when Canadian forces participated in the liberation of Holland. We think it is appropriate that we pause today to remember in particular the sacrifice of more than 7,000 lives of young Canadians, and, with the minister, we say that we shall never forget them. May we also never forget their survivors and their families.
We are glad that the minister is taking a delegation over to Holland this next week. We know, because of the warm relationships that exist between the Dutch people and the people of this country, that the delegation will have an interesting and enjoyable experience.
As I said, we join with the minister, and with all members in this House in remembering the sacrifices made by Canadians. Let us remember them in every way we can.


Some hon. Members:: Hear, hear!


THE ENVIRONMENT
Hon. John Roberts (Minister of State for Science and Technology and Minister of the Environment):: Madam Speaker, I wish to inform the House that my Ontario colleague, the hon. Harry Parrott, is announcing today the publication of a new draft pollution control order covering Inco's smelter complex in Sudbury.


Walter David Baker: Thank God for the Tories in Ontario.


John (Moody) Roberts: I wish to congratulate Dr. Parrott on the step he is taking; I know it was not an easy decision. I believe it is an important and courageous one. This draft order will be the subject of public meetings to be conducted over the next few weeks. This decision, which I salute and support, results from close co-operation between the federal and provincial governments in the sharing of research and detailed information.
The intent of the new order is to ensure that there is no increase in sulphur dioxide emissions from Inco, Sudbury, that reductions reflecting present developments in the production process, pyrrhotite rejection, be implemented in two years, and that detailed examination of specific technological means of reducing the emissions still further be undertaken by the company on an urgent basis.
An Ontario-Canada task force will be established to consider the implications of Inco's control options as well as those which might be developed for Falconbridge smelters in a wider environmental and socioeconomic context. The task force will also provide governments with an independent technical capacity to assess such options.
Our belief, based on existing studies, is that Inco is able to absorb the expenditures which may be required by a major emission reduction program. There is, however, a need to be sure that we fully understand the broader socioeconomic and environmental implications of alternative control methods. The joint study will also assist in providing the future basis for developing the most satisfactory mix of control strategies. That is why we are establishing the joint task force.
Members of the House I hope are aware of the government's efforts to develop an effective air quality agreement with the United States. Action within Canada against the largest single emitter of sulphur dioxide will have important results. I will strengthen Canada's case and encourage my counterparts in the United States in their attempts to develop control policies aimed at reducing acid causing pollutants. Reductions in emissions from the Sudbury region will also benefit areas within Canada downwind from Sudbury which are particularly susceptible to acid rain.
1 would like to elaborate briefly on those two points. With regard to the first, as hon. members know I met with environmental protection agency administrator Costle and Secretary of the Interior Cecil Andrus on April 18 in Washington. I expressed Canadian concerns for the proposed coal conversion
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program which could result in increased sulphur dioxide emissions. I also made it clear that Canada remains committed to drastic reductions in Canadian source emissions and would continue to look for a similar commitment from the United States. It was clear from that meeting that in order to secure a similar reduction from the U.S., we will need to move forward on the control of domestic emissions, as the province of Ontario is doing today.
With regard to the second point, the best available simulation techniques show that Inco emissions alone account for approximately 30 per cent of the sulphur deposition in Ontario. About 25 per cent of the sulphur deposited in the Ottawa area originates from the Inco operations at Sudbury. With respect to the Muskokas, which are particularly susceptible to damage from acid rain, approximately 40 per cent of the sulphur deposition originates from this source.
While I acknowledge that these simulated projections may not precisely reflect real life levels, their approximate relative magnitudes certainly point to significant benefits for the Canadian environment as a result of reductions.
I know hon. members are interested in our progress towards the bilateral agreement on transboundary air quality that the United States and Canada have committed themselves to developing. We are currently reviewing a U.S. proposal calling for the establishment of bilateral working groups to develop the basis of the agreement. This approach was successfully employed in negotiating the Canada-U.S. agreement on Great Lakes water quality. Given the length of time the development of an agreement might require, we are also seeking interim commitments to emission reductions pending completion of the formal agreement. The objective of the interim reductions commitment would be to preclude lenient interpretation of existing legislation which would allow for emission increases, apply existing legislation to effect further reductions from current levels, and identify the need for new legislation required for a long-term control strategy program.
Canadian moves to address the problems of acid rain sources in our own country will, I believe, considerably increase the chance for success in the negotiations we have now entered into with the United States.


Mr. Tom McMillan (Hillsborough):: Madam Speaker, like other hon. members, I listened with great interest to the minister's statement. It is, I think, the first such statement on motions the minister has made in the House in his capacity as Minister of the Environment. Given that fact and given the forum in which he has chosen to make his statement, I was expecting something important, something major, especially in view of the importance of the subject matter. However, what we have been treated to is little more than an announcement by the federal minister that his colleague, the minister of the environment for Ontario, is making a statement elsewhere this afternoon.
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I nevertheless welcome the statement of the federal minister and I especially welcome the announcement about acid rain that the Ontario minister is making in Toronto. But I am concerned on a number of counts. Coming from Prince Edward Island and the Atlantic region, I am not an uncharitable person, nor am I unkind. Yet, the temptation is almost irresistible to accuse the minister of attempting to coat-tail on initiatives being taken by Ontario. Indeed, there is the urge to accuse the minister of trying to scoop his colleague in the province of Ontario or even of seeking to share in some reflected glory from what measures have been adopted by the Ontario government.
The statement I am asked to respond to is essentially that of the province of Ontario, not of the federal government. As the Minister of the Environment (Mr. Roberts) has suggested, it took a great deal of courage for Ontario and the environment minister in particular to make the kind of statement being given this afternoon in Toronto. It took leadership. My regret is that that same kind of leadership is not being provided by his colleague at the federal level.
My party is enormously concerned about the problem of acid rain. We are concerned about the pollution emissions from Inco and we certainly welcome whatever initiatives come from either the Ontario government or the federal government.
The previous minister of the environment, the hon. member for Vancouver South (Mr. Fraser), once described the problem of acid rain as the most serious environmental problem ever to have been faced by Canada. I agree with that sentiment. Acid rain is killing our lakes, threatening our fish stocks, and devastating our forests, our wildlife and our land. The implications are profound. They are especially profound when one considers that something like three-quarters of our country's exports are related in some way, either directly or indirectly, to our natural resources, in their raw or finished state.
I remind the minister, therefore, that this is not just an Ontario problem, however important acid rain pollution may be in that province. It is a Canada-wide problem. I hope that, as the minister proceeds with his negotiations with Ontario and the United States, he will keep that fact in mind.
For example, in my own region, the Atlantic provinces, acid rain has badly hurt the salmon stocks. The ban on sport fishing of salmon is directly related to the problem of acid rain. It is thus a little worrisome that the federal government has seen fit to take the lead from Ontario. It is counting on Ontario to provide the leadership that is so badly needed. But acid rain is a trans-Canada problem and an international problem. For that reason the federal government has legitimate constitutional authority in this area and also a responsibility to provide the national leadership so badly lacking.
1 want to direct my remarks now specifically to what the minister has read to us. In some places the statement is gloriously ambiguous. I welcome the suggestion that there will be an Ontario-Canada task force. I suspect, however, that it is not a terribly new measure. Negotiations have been going on between the federal government and Ontario for some time.

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Presumably these consultations have also involved to some extent formal channels, machinery and procedures.
Thus I question whether such a task force is anything especially innovative, however welcome it might be. It also begs the questions, for example, of who will head it, who will comprise it, what will be its specific terms of reference, to whom will it report. I hope the minister will be forthcoming with information along those lines.
The minister has stated his priority to reach a fairly early agreement with the United States on the control of acid rain on both sides of the border. I welcome that priority. He suggested in his statement that the United States has proposed a number of consultative groups and a bilateral arrangement by which the two governments will consult, will keep one another informed, and will exchange views, leading it is hoped to an agreement of the sort I just described. My reservation is that the minister may be so preoccupied with the machinery, the formality and the procedure involved that time will be lost in actually getting the agreement accomplished that we desperately need. The minister has implied that that particular U.S. proposal will be reviewed carefully by him. I hope he will do just that.
The bilateral agreement between the United States and Canada is what we all want. There is some danger, though, that while we proceed to the agreement, time will be lost in preventing acid rain pollution from increasing.
I hope the minister will honour his commitment to seek some interim measures designed not only to prevent acid rain pollution from increasing, but also to reverse it. In that connection, I suggest that Canada must negotiate from a position of strength and that the strongest part of our foundation in negotiations with the United States must be a solid data base on acid rain pollution.
We require information of various kinds. For example, we need to know more about the different sources of acid rain, about how fast damage from acid rain occurs, and about the extent to which acid rain pollution is irreversible. In that connection, I would remind the minister that the former minister, who was so concerned about the problem, was able to secure from his colleagues in cabinet an agreement in principle on a substantial increase in funding for acid rain research. This priority was conveyed to the head of the U.S. environmental protection agency in January, 1980. Such a commitment was very important because it showed the strength of Canada's resolve to deal with acid rain pollution within its own borders.
The other day in the House, last Tuesday I believe it was, I addressed a question to the Minister of the Environment asking him in clear terms whether his government recognized acid rain research as a high priority and whether it planned to honour the commitment made by the previous government to increase funding for research in that crucial area. Mr. Speaker, I did not get an answer, nor have we been able to get much other information from the minister with regard to this serious
problem, one which calls for a great deal of federal leadership. I hope that in future a lot more information and leadership will be forthcoming than we have seen to date at the national level.


Ian Deans: Mr. Speaker, I must confess I was not aware that when ministers in the Ontario legislature make statements of intent with regard to legislation and regulation they have some way of seeing that the matter is brought to the attention of the House of Commons. I think that is wonderful; I wish it could be done in every instance.
I was reading with interest a copy of the statement the minister made and I must say it would have been very helpful if the control order had been in our hands so that we could determine exactly what the minister of the environment in Ontario means to do and the measures through which he intends to enforce the new regulations he proposes to put in place. As I read the statement, it says the new order is intended primarily to ensure that there is no increase in sulphur dioxide emissions from Inco or Sudbury. I must confess that in my view a commitment not to increase the sulphur dioxide emissions is hardly a commitment at all.
The statement goes on to say that most of the province of Ontario, at least the southern part, is suffering considerably as a result of the acid rain which results from the emissions in Sudbury and it points out that these emissions account for approximately 30 per cent of all the emissions in Ontario and for 25 per cent of the sulphur deposited in the Ottawa area.
With this in mind, to say that the new control order is designed to guarantee that pollution will not be increased hardly speaks to the problem at all. I am sure there are people in the Ontario legislature who might well be bringing to the minister's attention that he ought to be putting forward a much more forceful provision which would guarantee that this part of Ontario will no longer suffer at the hands of International Nickel, a company which, incidentally, has the wherewithal in its corporate structure to take whatever steps are necessary, at whatever financial cost, to eliminate, at least to all intents and purposes sulphur dioxide emissions.
Another part of the minister's statement which I found interesting had to do with the intent of the order, which was to ensure that reductions reflect present development in production processes. I see the minister's brows are being furrowed. He will read in the second paragraph that it is the intent of the new order that reductions reflecting present developments in the production process be implemented in two years. That, of course, when taken together with the original statement that no increase shall occur, leads one to believe we can hardly expect very much by way of a reduction in the output of emissions by International Nickel.
As far as the joint agreement is concerned, I want to say two things. First, to what extent is the Government of Canada prepared to provide money to clean up the mess which already has been created throughout most of southern and southeastern Ontario? Obviously, money will be needed. To what extent will the Government of Canada be prepared to put money into
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the cleaning of the lakes which have suffered such damage as a result of acid rain? 1 hope the minister will address himself to that question.
In addition, the minister referred in his statement to the reciprocal reductions by the United States and the need to achieve an understanding between Canada and the United States with regard to further reductions. I suggest to the minister that when he attends this meeting and talks about the reduction in the amount of acid rain which falls on the province of Ontario and, indeed, on other parts of Canada, he also raises one point which is of considerable concern to people in the Niagara area. We seem to experience a lot of difficulty getting the government of the United States and the companies under its jurisdiction to understand that we cannot afford to have them dumping their garbage into the Niagara River. It matters not whether it is acid rain or whether it is effluent from manufacturing processes; the fact is, on the surface at least, there is long-term damage suffered by the Niagara River and also to the area of Lake Ontario where the river enters the lake, as a result of a lack of enforcible regulation and the absence of an enforcible reciprocal agreement between Canada and the United States.
I suggest to the minister that as he talks about the further negotiation of the bilateral working agreement and about the bilateral working groups which are being set up, he keeps in mind that in any discussion about the effects on either country of pollution emanating from either jurisdiction, what is happening to the Niagara River, its effect on people who live downstream in the Buffalo and Niagara area and the effect of pollution spilling into Lake Ontario be one of his primary concerns. Just as acid rain is detrimentally affecting life in our lakes, so there is no question that a lack of adequate regulation is detrimentally affecting the Niagara River and the portion of Lake Ontario which is affected by the spill-out.
I hope that whatever negotiations are undertaken will be undertaken with this in mind, and that whatever the detrimental effect has been-and it will likely be long term in terms of acid rain fall-out in southern Ontario and in the Muskoka area-there be a commitment by both the federal government and the government of Ontario to do whatever is required in order to reclaim those lakes and the surrounding foliage. We must do everything possible to restore them to full use for recreational purposes because they afford by far the finest recreation potential which Ontario has to offer; they are certainly in the forefront of Canadian recreational potential as far as the possibility of their use by families in the immediate metropolitan areas of southern Ontario is concerned.
As I said earlier, I really would have liked to see the control order. The reference made to it does not give me a lot of confidence. I have dealt with Harry Parrott before. 1 do not know whether the minister has. If the minister has dealt with Harry Parrott, the minister of the environment of Ontario, he will understand that at times his word is perhaps questionable.
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I can distinctly recall statements made by the minister with regard to sanitary land fill and with regard to the disposal of liquid industrial waste and many other areas of environmental concern. Just not many weeks ago there was a statement about the closing of a sanitary land fill site and an industrial waste site in the area I represent. Just yesterday he announced that it is going to open again, and I really do think we need to adopt a measure with more teeth in it. Perhaps a minister with more teeth would be helpful. I am not talking about our minister here in this House, but I would suggest to him that he require of the provincial minister a clear indication not only of what his hopes are-because 1 think we probably all share his hopes-but also how he intends to implement measures to protect the environment in Ontario and how he intends to stand up to industry that undoubtedly will tell him that the costs are far too great and it will have to shut down.
That is the inevitable result of everything that is said when it comes time to sit down and negotiate the industry's financial involvement in the protection of the environment. Inevitably the response is that they can find the sources necessary for their ongoing manufacturing processes in other parts of the world. International Nickel has effectively done that in the last few years, has moved its operations substantially and reduced the emphasis that Sudbury once had in the world community for the production of nickel.
International Nickel Company will, I am sure, over the course of time, plead poverty and be prepared to run some serious risks with that community and its economy in an effort not to live up to its responsibilities. That has been the pattern; that has been the history. I think that to whatever extent this government has power in the field-and there is some question as to how much power one can exercise-legislative power or other power, it should be exercised to the fullest extent in order to extract from International Nickel the cost of cleaning up that which International Nickel itself created.


Thomas Michael McMillan: Madam Speaker, I wonder if the minister would entertain a question about his statement. I acknowledge the contribution of the federal government in connection with the case that Ontario made against Inco as far as levels of acid rain pollution are concerned and, in particular, the studies made available to the government of Ontario by the federal minister and his department which made the Ontario case pretty formidable. But the clear impression from newspaper reports, in any event, is that the studies to which the federal government had access, and which it in turn made available to Ontario, were very much fortuitous. The federal government practically stumbled upon certain information, certain leads, and certain "deep throat" connections, as the newspaper reports described them.
Would the minister indicate whether, in his view, his department now has the research capacity it requires to proceed with all due dispatch, for example, in its negotiations with the United States, or does he think there is a case to be made for a substantial increase in federal funding for acid rain research?
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If so, is the minister preparing to put before cabinet specific proposals toward that end, and when might we expect an announcement in that regard?


John (Moody) Roberts: Madam Speaker, I think I will reply briefly to the hon. member in two ways. Yes, I think we do have a very good capacity within the department, but it is also useful for us from time to time to hire outside consultants who can bring in specific expertise and knowledge which may not be readily available.
The second point I would like to make to the hon. member in response to the direct question in his statement today is that it is true that the previous government made commitments in principle. I think the hon. member will find that the funding of acid rain research by this government will exceed the commitments which were contemplated by the previous government.


Hon. John A. Fraser (Vancouver South):: Madam Speaker, I want to congratulate my successor in the Department of the Environment for the interest he has been taking not only in his department but also in this very vital matter. I know that he and I are in absolute agreement that it is going to require the co-operation of all Canadians in order to solve it.
I would like to ask a couple of specific questions. In January two working groups were established. One was a strategy group chaired by a representative from the province of Quebec. The other was a technical and scientific group chaired by a representative of the province of Ontario. Then there was an over-all steering committee chaired by myself as federal minister of the environment, as I then was, the minister of the environment from Quebec, the minister of the environment of Ontario and a minister representing the maritime provinces.
Is that basic structure continuing and, if so, where does the federal-Ontario task force with respect to Inco itself fit into that structure? I wonder if the minister might help the House understand just how the structure is proceeding and whether it has been maintained.
While I am on my feet I would like to put another question to the minister. It is interesting that the discussion today has involved only one company. As the minister well knows, while Inco is a significant producer of sulphur emissions, it is not, by any stretch of the imagination, the only producer of sulphur emissions in Canada. In addition to that, as the minister knows, the acid rain problem involves more than just sulphur. In fact, there is evidence which certainly was available to me-and I am sure that the new minister has been made aware of it-that nitrogen emissions are becoming an increasingly large part of the acidic precipitation problem.
I noticed that the hon. member for Hamilton Mountain (Mr. Deans) confined his remarks only to sulphur, whereas in fact in Canada, as in the United States, the nitrogen oxide problem is now contributing very significantly, we think, to the over-all acidic precipitation problem.
I wonder if the minister could direct the first part of his answer to the question of the structure of this task force and how it fits in, and the second part of his answer to the question
about other sources of emission. Particularly, what can we do about the increasing problem of nitrogen, which is something we cannot just blame all on Inco?


John (Moody) Roberts: Madam Speaker, I welcome the question; I hope I will be able to respond to all its parts. It gives me a chance, which I did not have when the hon. member was attacking me yesterday, to pay tribute to his work as minister in the environment portfolio. Much of what I am now doing is a continuation of the efforts which he has already made. I know that he and I share a very strong concern about these problems, and from time to time I will be seeking his counsel as well as his questions in the House.
I will try to respond to his specific questions. The structure has not been changed. He described it accurately, and we will be continuing with that structure. The committee which has been described, however, will be a special committee between Ontario and Canada. I am sure that the information which is produced will filter through the system, but technically speaking it will be a separate committee.
We have mentioned today specifically Inco, although there was a reference in my remarks to the Falconbridge situation, and we will be considering in the committee other sources of emissions. The hon. member is quite right-and I am dealing, I think, with his fourth point-that we are extremely concerned not simply about sulphur dioxide but also about nitrogen emissions. That is a particular concern in relation to thermal plants as sources of pollution. We are aware of that problem; we are concerned about it. The order that the hon. Harry Parrott has issued today does deal with sulphur dioxide emissions. However, the hon. member is quite right in suggesting that nitrogen oxides are equally a serious problem, and it is one to which we will be paying a great deal of attention.


Mr. Doug Anguish (The Battlefords-Meadow Lake):: Madam Speaker, I would like to ask a question of the Minister of the Environment (Mr. Roberts) concerning the task force. I assume that the objective of the task force is to make recommendations to reduce or ultimately to eliminate the problem of acid rain. I was wondering if it is within the scope of the task force to look at methods of reducing the potential of the fuel that goes into the production, say, of energy or into the refining processes such as those Inco use to remove the sulphur dioxide from the product before it is used. I think the example used was coal scrubbing whereby the byproduct is used for fertilizer, and also it removes the sulphur dioxide from the coal before being used in the plant. I was wondering whether these preventative measures are within the scope of the task force.


John (Moody) Roberts: I am sorry, Madam Speaker, but I was distracted for a moment in the middle of the question; I am not sure that I understood its full purport.
The scope of the task force is to examine both the capacity to use practicably the present techniques which are available or new ones which may be refined. Also it will deal with a variety of larger issues. It extends quite widely. If I properly
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understood the scope of the hon. member's question, I believe those matters which he described would fall within its consideration.
Perhaps I could check Hansard to see if I misled the member. I am not trying to db so deliberately, but I am not quite sure I caught all of the aspects of the question he presented to me.


Douglas Keith Anguish: Madam Speaker, I should like to put that in the way of a supplementary question. Basically I was asking if it was within the scope of the task force to look at preventative means rather than emission control.


John (Moody) Roberts: Preventative means of what? We are looking at the prevention of the levels of emission which are now taking place. That is why 1 am not sure I understand exactly the distinction the hon. member is making between preventative means and emission control.


Douglas Keith Anguish: The question I should like to ask of the Minister of the Environment is if he is aware that there is a process now for scrubbing coal which removes the potential harm of sulphur dioxide being given off and as a byproduct produces fertilizer? If he is aware of that, will it be within the scope of the task force to study such processes?


John (Moody) Roberts: Yes, I am aware of that. 1 am not sure whether the hon. member is referring to thermal generation or specifically to the Inco situation.


Douglas Keith Anguish: I am referring to the problem of acid rain.


John (Moody) Roberts: If the hon. member is referring to acid rain, yes, we are aware of those problems. As I understand it, there are at least two techniques which appear to be practicable in relation to the Inco situation. But I think the problem he is raising in relation to washed coal, for instance, is something which is more directly related to the oil and gas conversion plans which President Carter has presented to Congress. We are looking at all ranges of possible techniques, but there are two pre-eminently which are under consideration in relation to Inco.


Mr. David Orlikow (Winnipeg North):: Madam Speaker, several days ago, as reported in The Globe and Mail, the minister of the environment for Ontario, Mr. Parrott, was quoted as saying that while he welcomed the interest of the federal government on the question of acid rain, and particularly the problems in Sudbury as a result of the Inco operation, he made it quite clear that the decisions as to what would be done and when would be made by his government and not by the federal government.
I should like to ask the minister two questions. First, what authority will this joint task force have; and second, is the minister aware of the fact-and I do not have the report here-that in that report the Ontario minister of the environment set back by several years the date at which Inco would be required to really clean up the pollution it is creating? Has he
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agreed to a further delay on the part of Inco to getting rid of the pollution it is creating?


John (Moody) Roberts: Madam Speaker, I will reply in a twofold way. The present legislative base for action is in the hands of the province of Ontario. It is quite true, as the hon. Mr. Parrott has described, that the control order is within his authority and that it is his decision as to the issuance of that control order. Our participation at the federal level has been in the studies and the research which we believe have been very helpful to the government of Ontario in deciding to move at this point.
Our continuing role will be in studies with the province of Ontario to try to ensure that we have a sufficiently large knowledge base to be accurate as to what kind of control is possible and at what pace it should be brought forward.
The control order Mr. Parrott issued today caps the Inco emissions at the present level, which is far below the permissible levels of emission, with a provision for further lowering those levels of emission within the next two years. The third phase is the one to which our studies will be particularly directed.
I hope the hon. member understands that the order is within the legislative base of the province of Ontario, but that the province of Ontario and the Government of Canada have been working closely in a co-operative way to try to ensure that the steps taken by Mr. Parrott are taken as promptly and as efficaciously as possible.


David Orlikow: If I understood the minister correctly, he said that the amount of emission now from the operations of Inco is less than the limit, but I think the minister will agree that they are far too high. Unless they are pressed to get on with the job of moving closer to the time when there will be virtually no pollution, 1 do not know how the minister can go down to the United States and put any real pressure on the United States to get their polluters to take the kind of action which is required, because just as our pollution moves over their land, their pollution moves over our land. Unless we can show that we are really putting the pressure on corporations polluting water, air and land, I do not know how we can expect the United States to do better than it has done, and they have not done very well up to now.


John (Moody) Roberts: Perhaps I have not communicated sufficiently the point I was making. The capping at the present stage is followed by a subsequent and rather immediate stage which involves a considerable reduction in the levels. As I have said publicly, my very strong belief from the information we have is that within four or five years the emission can be reduced by 50 per cent to 60 per cent. 1 can assure the hon. member, as a result of the conversations I have had with United States officials, that the steps we have taken with Inco will not only be welcome but I think will lead to considerable pressure for a more responsive action on their part, not only in relation to possible future problems with the oil conversion program, but also in dealing with the present problem of what we consider to

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be too high emission levels in the present American polluting situation.


Svend Johannes Robinson: Mr. Speaker, I have two brief questions on the subject of the announcement today. 1 should like to preface them by saying that I think the House should give some recognition to the former hon. member for Nickel Belt who, as the House will be aware, campaigned long and hard to see a reduction in the level of acid rain which is taking place.


Some hon. Members:: Hear, hear!


Svend Johannes Robinson: He is no longer in this House, but I am sure his influence is being felt in this matter. I would ask the minister, if I might catch his attention for a moment, first: in view of the fact that it has been Inco itself which has given rise to the problems which resulted in this task force being formed, will he assure the House that indeed it will be Inco that pays the cost of this task force and not the taxpayers of Canada?
Second, I would ask whether the terms of reference of the task force will be broad enough to encompass a study of the effects of the sulphur dioxide emissions on the workers in the Inco mine and on the people of the community of Sudbury?


John (Moody) Roberts: Mr. Speaker, 1 am not sure that I understand exactly the relevance of the second part of the question. What we are dealing with here is the long-range airborne transportation of pollutant particles, whereas 1 understood the second part of the hon. member's question to be relating this problem to the condition of the workers in the mines. The impact of acid rain is not immediately in the area where it is generated but may fall 300 or 400 miles from the source point. So it does not seem to me, on the face of it, that the question he raised, which may be a very important one, would naturally fall within the purview of the committee. The financing of the work, which will essentially involve existing civil servants on the staffs of the two governments of Ontario and Canada, would be met in the normal way.


Mr. Jim Fulton (Skeena):: Madam Speaker, my first question to the minister is in relation to a statement that I believe was made last week regarding emissions. The minister referred to 40 per cent to 50 per cent reduction. 1 wonder whether he could clarify if that was in relation to the orders which, I believe, allowed emissions of 3,600 tonnes per day, particularly in view of the relative decline in production by Inco, certainly in recent months, which has brought that down, 1 believe, to 2,200 tonnes per day? Would the minister comment first on the release he made, indicating whether the 40 per cent to 50 per cent reduction was on the 3,600 tonnes or the 2,200 tonnes, which is the present rate of production?


John (Moody) Roberts: Madam Speaker, 1 hope 1 am accurate in saying that the figures I used were that within four or five years there could be a reduction of 50 per cent to 60 per cent on 1.1 million tonnes generated each year. 1 do not have a
calculator with me to make the calculation, but my belief is, on the basis of the information which I have received, that a 50 per cent to 60 per cent reduction on that figure could be-


James Ross Fulton: On the generated quantity?


John (Moody) Roberts: The hon. gentleman says "on the generated quantity". Yes, a 50 per cent to 60 per cent reduction on the generated quantity could take place over the next four to five years.


James Ross Fulton: Madam Speaker, having regard to the cost to the environment, I wonder whether the minister could comment regarding particularly those lakes that we already know are dead. Could he also comment on the relative costs? Could he give us a ball park figure on the cost to the environment to date of the pollution from Inco within Canada? I recognize there is some from outside our boundaries.
Would he also state whether in his view it is the responsibility of Inco that these lakes be revitalized, and should it be required that at some point in the future the various types of vegetation and animals whose health has been affected will have to be revitalized to bring them back as closely as possible to their original condition? Could he indicate whether in his view at this point such cost would be the responsibility of Inco, or within federal or provincial jurisdiction?


John (Moody) Roberts: On the first point, Madam Speaker, it is very difficult, with the state of knowledge that we have now, to link specific consequences with specific causes. It is very difficult to make that linkage. It is also difficult to estimate the over-all cost of acid rain to the environment. We know it is very, very considerable. It is easier to assess the impact in relation to lakes, and less easy at the moment to assess in relation to forestry, but we are talking of consequences in the hundreds of millions of dollars. It is difficult to trace back specific consequences in an area to specific source points. Perhaps it would be helpful to say that the Inco emission is not well over but slightly over 50 per cent of emissions in Ontario and about one quarter of emissions in the eastern part of Canada. So clearly Inco emissions represent a considerably important factor in those deleterious consequences, even though we are not able to bring exact consequences back to exact sources.
I think the second question the hon. gentleman posed, if I understood him properly, was whether Inco was able to afford to undertake these measures on its own. If that is the question, my response would be that I believe that Inco can well afford to take the steps which would be imposed to bring emissions down to 50 per cent or 60 per cent within the period I described.


Madam Speaker:: When I recognize another hon. member for the purpose of asking a question we will have spent about an hour on this particular statement. I will recognize another member now, but I will ask the hon. member for Hillsborough (Mr. McMillan), who has had a chance to make an important statement and ask a few questions, if he will voluntarily defer
May 1, 1980

his questions today and pose them at another time. I recognize the hon. member for Algoma (Mr. Foster).


Mr. Maurice Foster (Algoma):: Madam Speaker, since acid rain is a particular problem in northern Ontario where we have granite rock and, consequently, the water is not buffered, and where we have an inflow of pollutants from the United States mid-west and the whole industrial complex there, 1 should like to direct some questions to the minister.
I am aware that a certain amount of research has been going on at the Great Lakes Forest Research Laboratories at Sault Ste. Marie in northern Ontario, but 1 am wondering whether there is a commitment to additional funding for more research, especially in those parts of northern Ontario where we do not have the large bodies of water such as the Great Lakes to buffer the effects of these pollutants. Is there a commitment to more man-years and dollars for research to overcome the difficulties associated with the acid rain problem?


John (Moody) Roberts: Yes, Madam Speaker. As 1 tried to make clear in reply to earlier questions, considerably increased efforts in this regard were made, as a matter of principle, by the previous government. The funding for these commitments was never confirmed. It is our intent to increase the funding in relation to acid rain research beyond the figure which had been projected by the previous government. I cannot be specific on the exact details, at least at this moment, as to how much of that research will take place in various parts of the country, but I will certainly search for that information and provide it to the hon. member.


PETITIONS
Stanley Howard Knowles: Madam Speaker, I ask leave of the House to present a petition signed by nearly 5,000 persons, mostly from Saskatchewan but also Alberta and British Columbia. The petition was produced and distributed by the Saskatchewan Senior Citizens Action Now Association, a few members of that association being with us in Ottawa today.
The petition earnestly requests a substantial increase in the amount of pensions paid to our senior citizens; it asks for consideration of ways and means to facilitate older people continuing to live in their own homes; and it makes other suggestions to enhance the dignity of our older people.
I am happy to present the petition on behalf of the nearly
5,000 persons who signed it.
Order Paper Questions


Hon. Allan J. MacEachen (for the Secretary of State for External Affairs) moved: the first reading of Bill S-5 from the Senate, to repeal the Canada-France Trade Agreement Act, 1933 and the Supplementary Canada-France Trade Agreement Act, 1935.
Motion agreed to and bill read the first time.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. John Evans (Parliamentary Secretary to Deputy Prime Minister and Minister of Finance):: Madam Speaker, the following questions will be answered today; Nos. 206, 252, 310, 311, 312 and 314.
Madam Speaker, 1 ask that the remaining questions be allowed to stand.


Mr. Herbert: 1.	For each year on January 1, 1967 to 1979, what was the infantry strength of the regular forces?
2.	What is the projected infantry strength for January 1 (a) 1980 (b) 1981 (c) 1982?


J. Gilles Lamontagne: 1. Infantry Strength on January 1
Year	Total
1967	9,112
1968	8,907
1969	8,558
1970	8,097
1971	8,185
1972	8,050
1973	7,930
1974	8,205
1975	7,973
1976	8,014
1977	7,651
1978	7,649
1979	7,614
2. (a) (b) and (c)

May 1, 1980
Order Paper Questions
It is expected that current strength will be maintained.
* Note 1
The reduction of strength from 1976 to 1977 and up to the present is due to a change of accounting in that infantry recruits who had been on regimental strength-accounted for as infantry men-were transferred to a basic training list.


Mr. Herbert: Did the Minister of Finance or the Inspector General of Banks acting for the minister, have any discussions with the chartered banks since May 22, 1979, concerning the annual escalation of pensions to retired employees or the period of vesting for existing employees?


Hon. Pierre Bussieres (Minister of State, Finance):: It is not
government policy to suggest or impose conditions on private pension plans beyond those contained in the Pension Benefits Standards Act. However, the inspector general of banks in the conduct of his duties regularly discusses with the banks the conditions of their pension plans. I am advised that the chartered banks are continuing to pursue previously reported practices of making supplementary payments to their older pensioners, with increases in the cost of living being the primary factor in the determination of the amount of the supplement.


Mr. Herbert: In each of the past five years was any Defence Construction (1951) Limited work carried out for any department or agency other than the Department of National Defence and, if so, what was the dollar value and by whom was the work authorized?


J. Gilles Lamontagne: There was no work carried out by Defence Construction (1951) Limited for any department or agency other than the Department of National Defence during the past five years.


Mr. Herbert: For the fiscal year 1978-79, what was the total value of contracts for repairs and maintenance (renovations) awarded by Defence Construction (1951) Limited?


J. Gilles Lamontagne: Value of repairs and maintenance-renovations-for 1978/79 was: $40,286,430.


Mr. Herbert: 1.	Did the Department of Agriculture issue a publication, Monograph No. 25 entitled "A revision of the Gymnusini and Deinopsini of the world; Coleoptera: Staphylinidae, Aieocharinae"?
2.	Was the publication issued in the English language only and, if so, on what date and for what reason was a French language version not made available at the same time?


Hon. E. F. Whelan (Minister of Agriculture):: 1. Yes.
2. Yes, on October 15. It was published only in English because the complexity of the highly scientific subject matter makes translation almost impossible. The text is so technical that a scientist with the competence to translate the publication is not available to prepare a French language version. For this reason, certain highly technical scientific papers of limited interest-such as Monograph No. 25-are normally published in the language of the author.


Madam Speaker:: The questions enumerated by the parliamentary secretary have been answered. Shall the remaining questions be allowed to stand.
Some bon. Members: Agreed.


Mr. Herbert: 1.	Of the 680 head office tender closings of Defence Construction (1951) Limited in the fiscal year 1978-79, how many had a response of (a) one (b) two tenders?
2.	What was the total value of tender closings where only one tender was received?
3.	For how many tender closings where only two tenders were received was the differential between the two tenders (a) more than 20 per cent of the low tender (b) more than $50,000?


J. Gilles Lamontagne: 1.	(a)	53
(b)	105
2.	$5,339,336.16
3.	(a)	38
(b)	10


Ian Deans: Madam Speaker, 1 ask leave, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles), to move that adjournment of the House under Standing Order 26 for the purpose of discussing a specific and important matter requiring urgent consideration, namely the immediate crisis reflected in the automotive industry in Canada with over 25,000 Canadian workers laid off; the further announcement yesterday of additional lay-offs by General Motors of Canada; the cancellation by Chrysler today of its planned building of a new V-6 engine plant; the impasse in the negotiations with Chrysler Canada regarding
May 1, 1980

future plans; and the failure of the Government of Canada to seek formal renegotiation of the automotive agreement with the United States to ensure that Canada obtains its fair share of investment, jobs and research and development.


Madam Speaker:: Standing Order 26 provides for emergency debate and allows a member who feels that a matter is urgent to ask the Speaker for leave to set aside all other business before the House so that the House can proceed to debate the urgent matter. However, there are severe and strict limitations placed on this right, and they are set out in Standing Order 26, which 1 would like to read in part to the House. Section (5) of Standing Order 26 reads in part:
In determining whether a matter should have urgent consideration, the Speaker shall have regard ... to the probability of the matter being brought before the House within reasonable time by other means.
Section (16)(a) of the Standing Order states:
The matter proposed for discussion must relate to a genuine emergency, calling for immediate and urgent consideration;
Can the matter raised by the hon. member for Hamilton Mountain (Mr. Deans) be brought before the House within reasonable time by other means? That is the question which I must answer.
It would seem to me that, not only can this matter be brought before the House, but that it already has been before, namely, during the oral question period today. The many problems facing the automotive industry have been discussed during the address debate by the hon. member for Hamilton Mountain, the member who is now requesting leave to move a motion under Standing Order 26. May I remind hon. members that there are still two days remaining in the address debate and that there are 18 allotted days provided for under the special order adopted by the House on April 29.
Moreover, the estimates of the Minister of Industry, Trade and Commerce (Mr. Gray) have been referred to a standing committee and these estimates will be before the committee until November. Thus, I feel there is ample opportunity for the hon. member to raise the matter in other ways. On these grounds alone, I feel that the hon. member should not be allowed to proceed.
However, there is the further point that a request for leave to proceed under Standing Order 26 must relate to a genuine emergency. On June 26, 1978, Mr. Speaker Jerome, in ruling that an hon. member could not proceed under Standing Order 26, stated that matters raised under the Standing Order must not be of a continuing nature. In this present session alone this matter has been raised many times and, in my view, it will probably be raised again.
Thus, I must rule that the matter is not a proper one for consideration as an emergency debate under Standing Order 26.
Bank Act



GOVERNMENT ORDERS

[Stage Direction]
[ Translation]

Pierre Bussières: that Bill C-6, to revise the Bank Act, to amend the Quebec Savings Banks Act and the Bank of Canada Act, to establish the Canadian Payments Association and to amend other Acts in consequence thereof, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
He said: Madam Speaker, in proceeding this afternoon with second reading of Bill C-6, this Parliament continues the decennial revision of the Bank Act which is well beyond its original scheduled completion date of July 1, 1977. Since then Parliament has been required three times to extend the power of the banks to carry on business, the most recent extension being to April 1, 1980, with an automatic extension of 60 sitting days in this session. The bill now before us to revise the banking legislation of this country is an important one. It is comprehensive and will modernize the legislative and regulatory framework of Canadian banking and also establish a new payments association for managing and developing our payments system. At this stage, Mr. Speaker, there is little need for me to emphasize how urgent it is that this bill be considered and passed into law as soon as possible. The current revision of the Bank Act began in September, 1974, when the then minister of finance requested briefs from interested parties. These helped form the basis for the white paper on the revision of Canadian banking legislation which was issued in August, 1976. The Senate Standing Committee on Banking, Trade and Commerce received briefs and held hearings on the white paper. Its report of June, 1977, together with other public comments and suggestions, influenced the final form of Bill C-57, the Banks and Banking Law Revision Act, which was introduced but not passed in the third session of the Thirtieth Parliament.
This bill was reintroduced as Bill C-15 and received first reading on November 2, 1978; the subject matter of the bill was referred to the Standing Committee on Finance, Trade and Economic Affairs, and also underwent review by the Senate banking committee. The committees received numerous briefs and direct representations from interested parties, and presented their reports to Parliament immediately prior to its dissolution in the spring of 1979. Both committees were in substantial support of the policy thrust and proposals in Bill C-15. Nevertheless, they did recommend many changes to the bill.
During the administration of the previous government senior officials studied the reports of both committees and agreed that many of their recommendations would improve the bill.

May 1, 1980
Bank Act
All the substantive changes to Bill C-15 were in response to those recommendations. Approximately 40 of the recommended changes have been adopted in their entirety and more than ten others were incorporated with some modification. 1 have adopted the modified bill but have also found it necessary to make a number of technical corrections and changes. Details of the major changes have been set out in tabular form in the news release and summary which the previous minister of finance made available to the House.
At this point I would like to acknowledge the tremendous contribution made by the committees of the Senate and the House in the development of the proposals contained in the present bill. The extensive hearings by both committees allowed interested parties to be heard and their views carefully considered. 1 should also like to acknowledge the most recent review of Bill C-14 by the Senate committee.
This is an extremely long, complex bill, Mr. Speaker. It lays down the framework or ground rules for the establishment, operation and supervision of the chartered banks, the Quebec Savings Bank and the Montreal City and District Savings Bank. Provision is also made, for the first time, for the establishment of foreign-controlled banking subsidiaries in this country. In providing for the creation of a new Canadian Payments Association, it will also allow the full participation of the near banks-credit unions, caisses populaires and trust and loan companies-as well as the chartered banks, in the organization, administration and development of the Canadian payments system.
Over all, the main purpose of the bill is to strengthen and develop the Canadian financial system through the promotion of effective and equitable competition. This is true of the proposals relating to the Canadian Payments Association, easier entry into banking, chartering of foreign bank subsidiaries, authority for banks to lease and factor, the reduction in banks' reserve requirements, and the broadening of the geographical operations and business powers under the Quebec Savings Banks Act. The third part of the legislation deals with amendments to the Bank of Canada Act. The fourth part is about the establishment of the Canadian Payments Association Act. The fifth and final part concerns related and consequential amendments to other legislation.
What about the Bank Act? The main part of the present revision is of course the Bank Act itself. The chartered banks, serving the public from over 7,450 branches, with total Canadian dollar assets at the end of 1979 in excess of $147 billion and foreign currency assets, based on their domestic and international business, of about $82 billion, are central in Canada's financial system. In a very real way they tie the country together by providing their services on a national basis and bringing similar banking services at similar costs to almost all Canadians. In addition to making provisions designed to
implement new policies in areas such as entry into banking, foreign banks and the business powers of banks, the structure of the Bank Act has been redesigned in order to ensure that its provisions, where appropriate, are consistent with the principles and provisions of the Canada Business Corporations Act.
Among the banks themselves, the concentration of business in the hands of the five largest banks has been diminishing gradually and, since 1964, four new banks have been successfully established. Nonetheless, a continuing concern has been felt about the share of market of the five largest banks and the small number of banks. Consequently, the government has continued to seek ways to ease access to banking and thus to increase the number of alternatives available to Canadians. The proposals regarding entry into the banking business should make the establishment of a new Canadian bank a somewhat less difficult and uncertain undertaking while continuing to ensure that only soundly conceived enterprises are launched. These proposals include, first, the incorporation of banks by letters patent as an alternative to a special act of Parliament. Second, incorporation provisions to facilitate the conversion of an existing financial institution to a chartered bank. Third, the permission for provincial governments to hold and vote up to 25 per cent of the shares of a new bank-with provisions for reducing provincial ownership to 10 per cent over ten years. Fourth, an explicit indication in the act that Canadian financial institutions other than trust companies or deposit-taking institutions would be authorized to own and vote up to 25 per cent of the voting shares of a new bank, and higher percentages as may be approved by governor in council, for a period of ten years, after which the 10-per-cent rule would apply. Fifth, provision for foreign banks to establish banking subsidiaries in Canada.
I have also agreed with a proposal to remove the requirement in Bill C-15 that co-operative credit corporations as a group be disallowed from holding more than 25 per cent of the voting shares of a bank. Following closely the recommendations of the parliamentary committees, it is being proposed to associate all locals, centrals or regionals, and federations where they are linked by membership and operate within a single province. Each associate group will be able to acquire up to 10 per cent of the voting shares of a bank. Any existing holdings of up to 25 per cent would be "grandfathered."
With regard to the incorporation of new banks, whether they be Canadian-owned or foreign bank subsidiaries, the Senate Standing Committee on Banking, Trade and Commerce has recommended in its reports a system of public review of applications for letters patent of incorporation. The Senate committee concluded that a parliamentary form of review is inappropriate and that the public review should be conducted by the Inspector General of Banks. The inspector would be authorized to conduct such a review for all new banks, with the power to make appropriate recommendations to the minister to grant or refuse such applications.
May 1, 1980

1 have considered the Senate committee's recommendation most carefully but have decided not to accept it for the following reasons. The letters patent approach has been added to the special act approach to facilitate the incorporation of new banks and I do not want to introduce measures which could conceivably frustrate this objective. Such procedures might also hinder our reciprocity negotiations and the access of Canadian banks to other countries.
In addition, adequate safeguards have, 1 think, been built into the legislation. First, an intention by a potential applicant to apply for letters patent along with the proposed content of such letters patent would have to be published in The Canada Gazette and a Canadian newspaper once each week for a period of four consecutive weeks, thereby giving the Canadian public the opportunity to make representation on a potential application. I shall welcome such representations and give them careful consideration. Second, the assessment of the application and the applicants by the Inspector General of Banks would be no less rigorous than the current assessment by Parliament. Banking standards would not be lowered. Third, the Minister of Finance would be given the authoriy to issue letters patent at his sole discretion once approval was granted by governor in council, thereby avoiding the complicated administrative function with inherent delays. For those applicants who were unsuccessful in getting incorporation by letters patent, there would be the possibility of seeking incorporation by special act.
One of the most important provisions in this bill would allow foreign banks to establish banking subsidiaries in Canada. Foreign banks have greatly intensified their activities in Canada since the last revision of the Bank Act. The bulk of this activity has been conducted through financial affiliates incorporated under provincial charters. About 100 Canadian corporations in which foreign banks have an equity interest and which appear to be engaged in financial activities have been identified. About 50 foreign banks have an equity interest in these corporations.
Approximately half are U.S. banks and the balance, except for seven, are from countries of the European Economic Community. In addition, 50 foreign bank representative offices have been identified, of which about 30 represent banks which do not appear to have any investments in Canadian financial corporations. Total assets of Canadian affiliates of foreign banks reporting to the Bank of Canada currently exceed $6.4 billion. Clearly, the time has come to provide a way for foreign banks to operate in Canada within the framework of our federal banking legislation. This will provide for more competition in the financial markets for the benefit of Canadians. At the same time, the measures contained in the bill will ensure the preservation of a predominantly Canadian-owned and controlled banking system. It is proposed that foreign banks be allowed to establish banking subsidiaries in Canada, and be disallowed from undertaking banking business
Bank Act
in this country except through these subsidiaries. It is also proposed that there be no limit on the number of branches which a foreign banking subsidiary may establish in Canada, but ministerial approval be required for other than the first. It is also proposed that at least half the directors of a foreign bank subsidiary be required to be Canadian citizens ordinarily resident in Canada. Further, in accordance with the House committee's recommendation, all committees established by a bank board would be required to have at least one-half of their membership Canadian. It is also proposed that foreign bank non-bank affiliates be required to provide information and, in the case of financial affiliates, unless expressly authorized, be disallowed from borrowing in Canada with the guarantee of their parent.
It is also proposed that foreign banks be allowed to maintain representative offices in Canada but with regulation. Foreign bank-owned subsidiaries will have broadly the same powers as Canadian banks; the Bank Act will be their charter. The new bill provides for licensing of such subsidiaries, with initial and renewal licences for periods of up to three years. As will be the case with other schedule B banks, banks whose capital stock is closely-held, their growth and branching will be closely controlled by governor in council. For example, governor in council will approve the initial authorized capital and all future increases. The bill provides a maximum-size control for domestic assets of 20 times the authorized capital. In addition, the domestic assets of all foreign bank subsidiaries will be restricted in aggregate to 8 per cent of Canadian dollar and foreign assets booked in Canada with Canadian residents. This formula is different from that in Bill C-15 and reflects the recommendation of the House committee on this issue. However, it has not been found necessary to adopt the 10 percent figure recommended by the committee. Our calculations show that, with the new base, 8 per cent provides adequate scope for the establishment and growth of the foreign bank sector. Using year-end 1979 figures, it is estimated that the maximum permitted size of all domestic assets for all foreign bank subsidiaries would have been about $12.5 billion at that time. This limit would also grow with the banking system.
Bill C-15 required that foreign banks operate in Canada only through subsidiaries. I should note that the House committee recommended that foreign banks should be allowed to establish either branches or subsidiaries in Canada, provided that proper regulatory provisions could be enforced. It is the government's view that the subsidiary alternative, requiring capital in Canada, a board of directors at least 50 per cent of whom must be Canadians, and subject only to Canadian law, is the preferred route.
It was also proposed earlier that a foreign bank subsidiary be limited to five branches. Both committees recommended the elimination of this limit and the House committee further recommended that ministerial approval not be required. Re-

May 1, 1980
Bank Act
fleeting these recommendations and the submissions received by the committees and the government, this bill incorporates the House committee's recommendation by removing the ceiling entirely. However, ministerial approval is retained to help ensure reciprocity and some regional distribution of the branches of foreign bank subsidiaries.
In addition, Bill C-15 proposed to disallow foreign bank subsidiaries from having interests through the parent in nonfinancial corporations that were not permitted to a Canadian bank. This restriction, however, would effectively disallow a number of major foreign banks, particularly from the European Economic Community, from establishing bank subsidiaries in this country, unless they were prepared to divest present holdings and avoid acquiring, directly or indirectly, any future ownership in such corporations in Canada.
Both parliamentary committees recommended longer divestiture periods than were originally proposed in Bill C-15. It is proposed that present holdings be grandfathered, that foreign bank subsidiaries be prohibited from providing banking services to affiliated non-bank related companies, and that allowance be made for future indirect investments in Canadian non-financial corporations by a foreign bank through an affiliate. These clauses provide new flexibility and safeguards not found in Bill C-15, and are needed if a number of major European banks are not to be excluded from establishing banking subsidiaries under the act.
Mr. Speaker, I would like now to review some of the proposals which are being made to change the business powers of the banks. These were originally set out in the white paper of 1976 and they have been thoroughly considered since then. Some are designed to extend existing powers to promote competition; some constrain existing powers to prevent serious conflicts of interest. Others are designed to indicate certain limits to banking powers.
The major proposals are: First, financial leasing of equipment will be permitted subject to certain regulations, but only through subsidiaries. The existing Bank Act does not provide for banks to engage directly in financial leasing. As proposed by the House committee, Bill C-6 provides that banks be allowed to engage in this activity in a subsidiary that is required to meet certain conditions specified by the House committee and be subject to regulations prescribed by governor in council. The regulations will ensure that the leases are the functional equivalent of credit by requiring that the lease be tied to specific equipment; be on a non-operating basis, that is, the bank will have no responsibility for the operation, maintenance or repair of the equipment; and the lease must be on a full pay-out basis. By allowing banks into this type of leasing it is thought that the increased competition would increase the availability and lower the cost of financial leases.
Second, banks will be allowed to engage in factoring, again
only through subsidiaries.
Third, the 10 per cent ceiling which presently applies to a bank's investment in conventional residential mortgages will be retained. You may recall that Bill C-15 proposed that the current 10 per cent ceiling on a bank's holdings of conventional residential mortgages be removed. The trust companies and some of the mortgage companies voiced concern about this, and both parliamentary committees recommended the retention of a ceiling, the Senate committee recommending 15 per cent and the House committee the original 10 per cent.
We have decided to accept the House committee's recommendation. Any mortgage lending above that ceiling will have to be undertaken in a subsidiary working under the same rules as competing institutions.
Fourth, banks will be prevented from offering data-process-ing services directly or indirectly except for "banking-related" services that may be offered subject to regulations.
Fifth, banks will be specifically excluded from fiduciary activities in Canada.
Sixth, banks are precluded from having any involvement in the management of mutual funds but may act at arm's-length as agents in the sale of mutual funds. While banks are permitted to offer directly deposit-based RRSPs and RHOSPs, all other of these instruments can only be marketed on the same terms as mutual funds.
Seventh, restrictions are to be placed on the authority of banks to deal in securities. In particular, they will not be empowered to underwrite corporate security issues or to act as an agent in the direct placement of corporate securities. They will, however, be allowed to act as a member of a selling group. The basic policy aim here is to ensure that the securities industry will continue to play a major role in the capital markets.
Eighth, banks will be empowered to participate in consortium or syndicate lending where not less than one-half the total principal amount of the loan is advanced by banks, domestic and foreign.
Ninth, in general, banks will not be able to own more than 10 per cent of the voting stock of a Canadian financial corporation or of a non-financial corporation. However, we propose to make some exceptions to the general rule. These include bank service corporations, export finance corporations, mortgage loan corporations, leasing and factoring corporations, and venture capital corporations. Existing investments in excess of 10 per cent in non-financial corporations will have to be divested within a period of five years, unless a further period is approved by the minister. Excess investments in financial corporations are subject to grandfathering provisions prescribed by governor in council.
May 1, 1980

And finally, tenth, banks are to be given, for the first time, the same flexibility as other corporations in the raising of capital funds.
Section 88 of the existing act has been amended somewhat and, as recommended by the House committee, extended to include wholesale and retail inventories. It appears as clause 178 in the bill before us today. A similar section has been part of Canadian banking legislation since the first act in 1871. In general it has served Canadians well. However, a few provincial governments have recently passed personal property security legislation and others are considering such legislation. This legislation overlaps section 88 and may result in certain confusion in the law. Furthermore, the Senate committee and the Cattlemen's Association have expressed concern about certain other features of clause 178 of the bill. The government will seek to prevent overlapping and confusion in the law and to ensure fairness in its operation.
A reduction in the cash reserve requirements of the banks is proposed in the bill. This reduction would be phased in over a three and a half year period beginning one month after the enactment of the bill. The rate on Canadian currency demand deposits will be lowered from 12 per cent to 10 per cent. In the case of Canadian currency notice deposits, the rate on the first $500 million will be lowered from 4 per cent to 2 per cent, and on the rest from 4 per cent to 3 per cent. In addition, the reserve requirement on non-encashable term deposits with an original term to maturity of one year will be completely removed.
I support these changes because the current level of reserves is not necessary for the effective implementation of monetary policy. The reduction of reserves would retain some degree of competitive balance among deposit-accepting institutions, which was visualized in the white paper. The lower reserves may redress a bias which has made it advantageous for some companies entering the deposit-taking business to do so in the form of near-banks rather than banks. Other proposals for easier access discussed earlier will also work in this direction. Finally, the lower reserves will reduce the cost of banking to the benefit of the customers and shareholders of banks.
With regard to the 3 per cent reserve requirement on foreign currency deposits used in Canada which was proposed in Bill C-15, the Canadian banks have correctly noted that this would place them at a disadvantage relative to foreign banks; foreign banks would be able to bring foreign funds into Canada with no reserve requirements and lend those funds to Canadians, while Canadian banks would have to maintain a 3 per cent reserve whether the funds were raised in Canada or abroad. Consequently, it is proposed that the 3 per cent reserve requirement be placed only on foreign currency deposits of Canadian residents booked in Canada. This would achieve the objective of removing an incentive for Canadian banks to encourage their clients to hold deposits in foreign currency rather than in Canadian dollars, while ensuring that Canadian
Bank Act
banks are able to compete with foreign banks in offering foreign currency loans to Canadians.
The provisions in the existing banking legislation which empower the Bank of Canada to fix the level of secondary reserves which must be held by the chartered banks will remain unaltered. Mr. Speaker, it will no longer be necessary for bank directors to hold qualifying shares. This removes what might have been a substantial financial barrier for certain people, and particularly women, to sit on the board of a bank. Clause 59 of Bill C-15 would have prohibited officers or employees of a chartered bank from serving on the boards of directors of most Canadian corporations. This was proposed because of a concern that bank officers or employees who serve as directors for another corporation could be subject to conflict of interest in that corporation's relationship with chartered banks. This proposal has met with considerable resistance from senior officers of Canadian corporations who have indicated that chartered bank officers and employees are valued members of their boards, providing a high level of specialized expertise.
The submissions have stated that there has been no evidence of conflict of interest, that corporations have not felt constrained to deal with any one bank because of the presence of a bank officer on the board of directors, and that this provision would operate to the detriment of the Canadian business sector. Accordingly, I am proposing to adopt the recommendations of the parliamentary committees. Officers and employees of a bank will continue to be able to sit on the boards of other corporations subject to the approval of the board of the bank.
Bill C-15 contained a provision prohibiting directors and employees of Crown corporations from serving on the board of directors of a chartered bank. Our review of this provision indicated that a change of this nature would hamper the ability of the federal and provincial governments to attract qualified directors for their Crown corporations without commensurate benefits. It is being recommended therefore that, while employees of a Crown corporation should not serve as bank directors because of their direct ties to government, directors of Crown corporations will be permitted to serve as bank directors.
The Quebec Savings Banks Act applies to only one institution, the Montreal City and District Savings Bank. This savings bank has many of the characteristics of the loan companies and owns a trust company. Part IV of the bill proposes certain changes that will broaden the geographical operations of this savings bank to all of Canada and will improve its powers to provide a wider range of banking services to its retail clientele. Some of the important changes proposed for the banks such as those affecting shares and shareholders, broader powers to raise capital, requirements for auditors and capital adequacy are also introduced into this

May 1, 1980
Bank Act
legislation. Mr. Speaker, certain amendments are proposed to the Bank of Canada Act. These will, for the most part, update the act, and make the consequential changes required by the new Canadian Payments Association Act.
Mr. Speaker, 1 would like now to deal with the Canadian Payments Association Act. Arising out of the growing importance of the near bank deposit-accepting institutions, and changes in the way Canadians may make payments as a result of increasing use of the computer, this bill introduces a totally new act, the Canadian Payments Association Act. At the present time, the cheque-clearing system is the responsibility of the Canadian Bankers' Association. The banks, however, make this facility available for the clearing of cheques drawn on near-banks. The proposed association will provide a framework for the direct participation of the near banks in the operation and planning of Canada's payments system. This represents an important advantage to the near banks and will help ensure their continuing ability to compete in the offering of financial services as the system continues to evolve.
The association will be run by its members. They will be grouped according to their institutional character for the purpose of voting. No single group will be able to control the association. To ensure that the broad public interest will not be neglected, the bylaws of the association will be subject to approval by governor in council. The chairman of the board will be appointed by the Bank of Canada, and the Inspector General of Banks will report annually to the minister on whether or not the association is operating in conformity with the act and its bylaws.
While the proposals has been generally welcomed, certain aspects of it were criticized by the provincial governments and the near banks. One particular concern was that the federal government would use the association as a vehicle to regulate provincially-chartered near-banks. That, of course, has not been the intention. It has been decided that membership in the association should be voluntary except for the banks which are still the most significant financial institutions in the payments system. We continue to believe it is important to have as members of the association all the major institutions accepting transferable deposits. The members of the association will have certain obligations. They will be expected to co-operate in the effective running of the system and to bear their share of the operating costs. The chartered banks will continue to be required to hold cash and secondary reserves under the Bank Act, but it has not been thought necessary at this time to extend this requirement to the near banks. Settlement balances for these members will be a matter for the by-laws of the association. Finally, to ensure financial stability, every CPA member other than the Bank of Canada will be required either to belong to the Canada Deposit Insurance Corporation, have its deposits insured under a provincial enactment that also provides for the inspection of financial institutions, or belong to the Canadian Co-operative Credit Society and hold a valid
certificate under the Co-operative Credit Associations Act. This new act significantly changes the institutional framework within which our payments system will evolve. As I have noted, it is an important initiative in helping to ensure a continuing strong competitive position for deposit-accepting near-banks.
I would like to say a few words about regulations. In a number of instances in this bill it has been found necessary to provide for regulations. This reflects, in part, a more complex and diversified banking system and, consequently, the need to provide flexibility to respond to future developments. The government has sought to keep the power to issue regulations to a minimum, and is also proposing that it be mandatory for new regulations and changes to old ones to be published in The Canada Gazette at least 60 days before the regulations are to come into effect. This will ensure that interested parties have an opportunity to seek changes in the regulations before they come into effect.
Regulations on the calculation and disclosure of the cost of borrowing and charges and rates of interest on deposit accounts are being proposed. Their form has been influenced by consultations with the provinces. Because these consultations are continuing, I have made a commitment to the provinces to provide sufficient flexibility in the Bank Act to permit subsequent modifications of the regulations if the provinces and the federal government together agree to adopt common standards in this area. In conclusion, Mr. Speaker, I recall that since 1967, when the last Bank Act was passed, the financial institutions and capital markets in Canada have undergone considerable growth and change. This says a great deal for the flexibility of the present legislation and regulatory framework, but it now requires early modification not only to reflect the underlying real changes but to anticipate those which are expected, such as developments in the electronic payments system.
The process of the decennial revision has now been underway for five and a half years. All of the interested parties have been heard many times and their briefs carefully considered by parliamentary committees, ministers and officials. The banks, the Montreal City and District Savings Bank, the caisses populaires and the credit unions, as well as other financial institutions, want the new bill passed and the uncertainty removed.
Sound, efficient and well-functioning financial institutions and markets are necessary for the smooth operation and growth of our modern industrial economy. It is our responsibility to provide the legal framework within which the financial institutions can operate successfully, and through consideration of Bill C-6 on second reading, it is the enormous task the members of this Parliament are called upon to perform.
May 1, 1980



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Blaker):: Order, please. It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Central Nova (Mr. MacKay)-Fisheries-Over-the-side sale to foreign fishing fleets; the hon. member for Mississauga South (Mr. Blen-karn)-Immigration-Timothy Leary-Entry into Canada- Hotel engagements; the hon. member for Comox-Powell River (Mr. Skelly)-National Defence-Defence procurement contracts-Alleged discrimination in awarding.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Bussieres (for the Minister of Finance) that Bill C-6, to revise the Bank Act, to amend the Quebec Savings Banks Act and the Bank of Canada Act, to establish the Canadian Payments Association and to amend other acts in consequence thereof, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Mr. Bob Rae (Broadview-Greenwood):: Mr. Speaker, first I would like to express my thanks to the hon. member for Edmonton West (Mr. Lambert) for letting me speak, in a sense out of turn-something I am not accustomed to doing- because of another engagement. I want to give him my assurance that I do not plan to use unlimited time in responding to the speech the minister has given.
I also congratulate the minister on his speech which, 1 believe, is the first he has given in the House regarding the Bank Act since his appointment as minister.
I would like to advise the House that the New Democratic Party will be opposing this bill at second reading. We will have a number of amendments to put forward in committee. We will have a number of speeches to make and recommendations to make to the government because of our concerns about the market power of the banks; the lack of provision in the act to provide adequate protection to the Canadian consumer; the lack of protection for near-banks and other competitors with the banks in certain fields such as computer services and auto leasing; concerns we have about limitations on the abilities of provinces to buy into our chartered banks and limitations on
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the abilities of credit unions to buy into banks; concerns about the arrival of foreign banks in Canada; the unfortunate decision of the government to allow bank directors to continue to occupy as many other directorships as they can; and the fact that the banks are coming before us, as they do every ten years, to request that they achieve security in the Canadian financial system and that they have a guaranteed status and a guaranteed profit.
At the same time, those people who are working for the banks are treated among the most poorly of all employees in Canada. The fact remains that one chartered bank in particular, the Canadian Imperial Bank of Commerce, has been condemned time and time again by the Canada labour relations board for a systematic pattern of discriminatory behaviour. We in this party can see no reason why we should be prepared to give quick and speedy status to our chartered banks when they are not prepared to treat their own employees with any kind of respect or with any guarantee of security.
Let us look, first of all, at the animal which we are regulating. The five largest banks in Canada hold more assets than the 200 largest non-financial corporations all rolled into one. The largest of the big five, the Royal, has 3.5 times the assets of the Bank of Canada. It is 25 times the size of General Motors of Canada. The smallest of the big five, Toronto-Dominion, is almost as big as the nation's two largest Crown corporations, Ontario Hydro and Hydro-Quebec, together.
We have seen a dramatic and quite fantastic growth in the assets of the big five since this House last considered the Bank Act in 1967. Since 1970 alone the assets of all the big five chartered banks totalled together have increased some 480 per cent, from some $43 billion to just over some $206 billion at the end of 1979.
When we consider the colossal market power that these institutions have, we have to look at the Bank Act as the sole protection that the Canadian consumer and the Canadian businessman has against the banks' abusing that market power in order to impose their own financial interests and financial wishes on either the Canadian consumer, the Canadian borrower-be he a small borrower, a small businessman or a middle-sized corporation-or the Canadian lender, whether he be a moderate-sized lender buying term deposits of $4,000, $5,000 or $10,000, or a Canadian depositor who is simply saving from day to day and trying to get whatever return he can from the bank.
With the government's interest rate policy the fact has been that since 1976 the banks have doubled their assets and their profits, so that in 1979 the profits of the banks totalled over $1.2 billion. As interest rates have gone up, as they have under this government and under the previous government, we have also seen-


Roy MacLaren: The rates have gone down again.


Bob Rae: The hon. member for Etobicoke North (Mr. MacLaren) says that the rates have gone down again. That is certainly not the result of the policies of the government, and I find it very difficult to see how a government which fails to

May 1, 1980
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take responsibility for rates when they go up can now start claiming responsibility for rates when they come down.
The fact remains that we have been allowed to see, with the dramatic increase in interest rates, the way by which the banks have been able to manipulate the rates which they charge to lenders and the rates which they pay to depositors. We have been able to see the way by which they have been able to take advantage of a high interest rate policy.
The banks have argued that they, too, are squeezed by high interest rates. If I were making $325 million in the first quarter of 1980, that would be some squeeze. I wish somebody would squeeze me like that. They are arguing that they are being squeezed, but the fact remains that whether or not high interest rates cause a great deal of volatility in terms of bank profits-and there is no question that they have had some effect in that regard-the way by which the banks allocate their credit decisions and the way by which they decide who will receive what rate is something at which the government has to look.
When we on this side of the House raised the matter of the way by which the banks were manipulating interest rates and charging the lowest possible amount to Canada's least sophisticated and least wealthy savers, the people who deposit in a normal savings account, it was the Minister of Consumer and Corporate Affairs (Mr. Ouellet) who said that he would be taking a very close look at this, that this was something the government would be looking at. In fact, he suggested that we would have to wait for the publication of the new Bank Act to see what stand this government was going to take with respect to interest rate spreads and the ways in which the banks are able to use their market power in order to take advantage of Canada's economic situation.
Well, the fact remains-and it comes as no surprise to those of us in this party-that when the time came for the government to publish the Bank Act, there was nothing there. The Bank Act is totally silent on the question of profits. The Bank Act is totally silent on the question of interest rate spreads, and it is entirely silent on the subject of interest rate control.
The Bank Act is equally silent on the subject of consumer protection. We have the statement from the minister today that of course there are matters which must be included in regulations because they are subject to continued consideration by the department as to exactly what they will do. Yet, I would have thought that the Bank Act would provide the government with the best opportunity possible to give confidence to every single Canadian consumer. I would have thought that this was an act designed not for the banks or for the convenience of these tremendously powerful financial institutions, but for the protection of the lowly consumer, the average citizen.
Let me relate a personal experience, having had a loan at a credit union and having had a loan at one of Canada's chartered banks, the Bank of Montreal. When the time came to pay off the loan at the Bank of Montreal which I wanted to
pay off earlier, I was penalized by the Bank of Montreal because of the way in which they calculate their interest payments. They used the so-called "Rule of 78", the sum of digits approach, for calculating the payment of consumer debts as opposed to the normal amortization approach.
There is a complete contrast between the kind of penalty facing each and every consumer who have loans with one of our three chartered banks that continue to use the "Rule of 78" method and the method used, since their formation, by Canada's credit unions, a method that has been followed by two chartered banks but not all of them. The fact remains that the banks are taking systematic advantage of those Canadians who choose to pay off their loans early because of the way in which they calculate payments of interest.


David Orlikow: It is theft.


Bob Rae: The hon. member for Winnipeg North (Mr. Orlikow) says that it is theft. Some rob you with a six-gun and some rob you with a fountain pen, Mr. Speaker.


Mr. Rose:: White collar crime.


Bob Rae: It is white collar crime, as the hon. member for Mission-Port Moody (Mr. Rose) calls it. The fact of the matter is that the average consumer who walks into a bank is less sophisticated and does not know the method under which the bank calculates its interest payments on loans. If that consumer goes into a credit union, he gets a much better deal and much greater protection than if he goes into one of Canada's chartered banks. The reason is that truth of lending provisions are absent from the Bank Act, because they indicate that they will be in the regulations, which we will hardly ever see and which no one will understand. Understanding the Bank Act itself is difficult enough, let alone the regulations under the Bank Act. There is no guarantee that the average Canadian consumer can walk into a bank and have the same protection and the same confidence that he is not being taken for a ride as he would if he walked into a credit union. This is a point that we have been making for some time.
It is rather surprising, when the minister talks about competition and so forth being one of the primary goals of the act, that the government would have decided simply to leave it to the banks to decide what method of calculation they will use. It is a technical matter. Not everyone understands the "Rule of 78". One requires a blackboard to show how the banks do it. But I am sure the minister is aware that when the chartered banks calculate consumer loans using this notorious method, the result is that consumers who pay off their loans early pay a penalty to the bank. The banks reap a simple windfall because we do not have a government that is prepared to bring in legislation under the Bank Act to provide protection for the average consumer.
The minister mentioned that encouraging competition was one of the major aspects of this bill. He mentioned the Canadian Payments Association of which we are in favour. We have some concern about the amount of consumer participation in that association, but we are happy that the Canadian
May 1, 1980

Payments Association is going ahead and that the caisse populaire and credit union movement will finally be able to compete a little more fairly with our chartered banks. But I find it ironic that the other two methods the minister described as encouraging competition are the banks engaging in leasing and factored activities, and foreign banks. I suggest that the competition in leasing will last for about two years; then it will be over because the banks will have taken it over.
I should like to refer briefly to a couple of meetings which I have had with the hon. member for Hamilton Mountain (Mr. Deans), the hon. member for Kamloops-Shuswap (Mr. Riis), representatives of the automobile dealers and other people engaged in the leasing business, and of course the bank subsidiaries that are interested in getting into the business. All members of Parliament received a letter from the Canadian Bankers' Association, that well-known eleemosynary institution, a charitable foundation. It was from a Mr. Mackintosh who is a very distinguished man and very able spokesman on behalf of the banking community. The thrust of the letter was that the automobile dealer should not be upset because the banks are not interested in getting into automobile leasing, maintenance and servicing. He said that the banks cannot perform such services by law, nor do they intend to get involved in servicing automobiles.
I should like to refer to another letter which was sent to an automobile dealer in Dartmouth, Nova Scotia, from RoyLease Ltd. As the minister may know, RoyLease is a subsidiary of the Royal Bank which is engaged in the leasing business. The letter indicated that in an effort to provide their clients with an effective leasing portfolio, they are developing a maintenance program.
Another letter indicated that all of the client representatives of RoyLease will be issued a Visa national account credit card. It indicated that this will be in the form of a regular Visa card with a RoyLease sticker on the right side of the white band. It requested that upon presentation of the Visa card they allow a 20 per cent discount on parts and a 10 per cent discount on labour to be applied to the driver's bill. If that is not getting involved in the maintenance and servicing of cars and using their market leverage in order to impose their will on a dealer, I do not know what is. That is exactly what has happened; that is exactly what is going on. That is a question which must be resolved in committee.
Unless we deal with that problem there is no question that the banks will use their market power to exercise leverage over automobile dealers and over the small dealers in Canada, some 4,000 of them, and they will be putting those dealers out of business in very short order. Now, that is the bank's definition of competition. They say that they can provide a better service, just as they did in 1967 with consumer loans. But there is another public interest involved here and that is whether we want the banks to be the ones that can control the leasing business in Canada. There is no question that they can do it, if they put their minds to it, in very short order. This is a question which must be discussed at committee stage.
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Also there is the question of the involvement of banks in computer services. I am sure the minister is aware of the case currently before the Supreme Court of Canada involving Central Computer Services Ltd., Comcheq Services Limited and the Toronto-Dominion Bank. That case was one that involved these firms saying that the bank was not engaged in the business of banking under the 1967 act but was engaged in computer and payroll activity which was outside the realm of banking.
Of course, we will have to wait for a decision from the Supreme Court, but let me suggest that this is a very critical question. It may not be adequate for the government to say that it will not provide a definition of banking in this legislation because banking is what bankers do. In effect, that was the decision of the majority of the Manitoba Court of Appeal which threw out the application for an injunction from the computer companies once that application had been granted a trial. It was thrown out because they said that the essential definition of banking is whatever bankers do. What bankers do is banking, and if bankers engage in payroll activity or in extensive use of computer services, then that is their role in the future. The same thing could apply to auto repairs, and the same thing could apply to a lot of other areas. You have to look at banks here in terms of their relationships with these businesses.
These businesses are going to the banks for their own financing while the banks, at the same time, are engaged in activities which are directly competitive with those small businesses. This is not really competition; it is like comparing a butterfly and a steamroller. There is no comparison.
The government will have to look very hard and carefully, and may, indeed, have to look again in committee, at the question of whether we have provided in the act, not just in the regulations but in the act itself, adequate protection for those sections and sectors of the business community we feel deserve to be protected from the monolithic power of competition from the banks.
Let us not in the name of competition eradicate competition, because competition is something that can only be protected in some cases if we limit the market power of quasi-monopolistic institutions such as chartered banks. I suggest that allowing the chartered banks to get into some fields of activity may in fact lead not to competition, except on a very temporary basis, but, over the next ten years, to an even greater concentration of activity in their hands.
There are three other points I want to make, Mr. Speaker, before I close. First of all, we deeply regret the decision of the government to, in a sense, double-track its earlier decision on the question of bank directors. We agreed very much with the decision, or the recommendation, of the Royal Commission on Corporate Concentration, the thrust of which was to reduce the requirement that directors ought to be shareholders. We are very concerned about the fact that the government has backtracked on its original decision. We know it was subject to

May 1, 1980
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a lot of corporate pressure from many of its corporate backers, but the fact remains that we are deeply concerned with the extent of corporate concentration in Canada, with the problem of corporate linkage and the way in which the intercorporate directorships can be used to increase market power and increase the forces of concentration in Canada.
We know we have a tax system which encourages concentration because, it allows all large corporations to deduct interest payments on funds they borrow from banks in order to finance takeovers. I find it hard to see why these financial institutions that occupy such a fiduciary relationship with the Canadian people-a position of trust with the Canadian people-should not be subject to far more careful consideration by us, in terms of conflict of interest and in terms of the problem of corporate concentration. I know my colleague, the hon. member for Comox-Powell River (Mr. Skelly), will be referring to these questions as well as to the issue of consumer protection when he speaks later on in this debate.
Again the minister stated that we need more competition in Canada, and that is why we need to bring in foreign banks. The government admittedly reduced this from 15 per cent to 8 per cent, but our party still remains opposed in principle to the notion that banking, that critical activity in the Canadian economy, should become the subject of the entry of foreign banks, and should become the subject of foreign penetration.
I find it ironic that a government which pays such strong lip service to the notion of Canadian economic autonomy, and which pays such strong lip service to the notion of competition in our financial system, would tell us that the only people who can really compete with our Canadian banks, and the only way we can have competition, is not to encourage or make it easier for near-banks-caisses populaires, credit unions and trust companies-to engage in banking activity and become competitive, but to allow in foreign banks.
1 suggest that some of the consequences will be to reduce the ability of the government to control outflows of capital at times when outflows of capital are not in the best interests of the country. I suggest to the minister that allowing the arrival of so many foreign banks will limit the ability of the minister to control Canada's economic policy. When we have a Minister of Finance whose view of the market is such that he does not see how he can control the situation, such as the minister we have today, that may not be such a bad thing. When we have a New Democratic minister of finance it will clearly be of some disadvantage to have some 50 or 60 foreign banks that may be subject to the laws of foreign jurisdiction, particularly American corporations.
While I have stirred the minister to life, and I am glad to see that, I think the tendency will be to decrease the ability of the Minister of Finance to exercise some important controls on the economy, and to limit the ability of the government to exercise some important controls on capital flows and capital markets. I think it will tend to make it more difficult for Canadians to form banks, because I think the tendency will be for foreign corporations to skim off the most lucrative foreign investments and foreign business, and the result of that market penetration
will be that Canadians who are involved in wanting to form banks, or get involved in banking, will have a far harder time reaching the marketplace. The tendency will be for less competition rather than more.
Finally, I want to say a word about unfair labour practices in the banks. 1 mentioned at the beginning that these banks come before us looking, as they do, for protection. They are seeking protection and they are seeking regulation in their own interests. However, we have the Canada Labour Board saying in one of its recent decisions involving a bank in St. Catharines, and it follows on a number of decisions, that it has become apparent throughout the organizational attempts at various branches of the employer across the country by several unions, that the employer, and I am referring to the Canadian Imperial Bank of Commerce, Mr. Speaker, has embarked on a campaign designed to discourage its employees from exercising their rights under the Canada Labour Code. The board states that some attempts were blatant and blundering, while others were more sophisticated and subtle. That sounds like the performance of the Deputy Prime Minister and Minister of Finance (Mr. MacEachen) in other matters.
The fact remains that we have our largest financial and, indeed, our largest corporate institutions, coming before this Parliament cloaked in a mantle of some respectability- indeed, we almost all fall on our knees in the face of bank managers, be they large or small-yet we are told by the Canada Labour Board that the Canadian Imperial Bank of Commerce has been engaged in a systematic attempt to subvert the rights of Canadians under laws passed by this Parliament.
I think this is a very fundamental question. Why should we in this Parliament be granting such security and status to our largest financial institutions when they are not prepared to accept, indeed, when they are subverting systematically, to use the words of the Canada Labour Board, the rights of Canadians passed by this Parliament? I must say that that is something that is lost on me and lost on members of this party. We are not prepared to grant banks such security until such time as we can be sure that the rights of employees of the banks are respected and guaranteed, and until such time as the employees working for the banks have the same security as the banks are asking from this Parliament.
1 want to end by suggesting to both ministers of finance who are with us today that we look forward to a long, healthy, and vital debate. We realize that this matter has been before this House in one form or another for quite some time. We are also convinced that hasty passage of the bill, and that, if one listens to the rumours one hears on the floor of the House, a refusal to allow the committee to call witnesses or that the Bank Act will be considered in Committee of the Whole and not even referred to the finance committee, would not serve the best interests of Canadians. We give notice to the minister that we will be pressing in committee for the calling of witnesses on the critical questions of corporate concentration, market power, competition, and consumer protection.
May 1, 1980

I can assure the minister that we will be giving him a list of amendments and that we will be co-operating with him in terms of not letting our guard down, just as I did when the Conservative party was in power and we presented them with amendments on different bills to let them know exactly where they stood and where we stood. We intend to let the minister know, with the changes in the House of Commons which have taken place since 1977 and with the fact that we now have a very large turnover of membership, that we intend to have a close look at this legislation.
In closing, 1 want to contrast the kind of activity which we expect to take place in the committee with what Mr. George Haig, who was then the general manager of the Bank of Toronto, said in providing a candid description to his fellow Canadians as to how the 1871 Bank Act was written, "Representatives of the chartered banks from all parts of the country sat in conference, day by day discussing the clauses of the proposed act one by one. We sat in one of the committee rooms of the House and discussed the bill with considerable sense of responsibility, being well aware not only that our conclusions would affect the whole banking interests of the country, but every other interest; commercial, manufacturing, industrial, not to speak of the interests of the government itself'.
This is not an act which we think is written by banks for banks. This is an act which is written for the people of Canada by the people of Canada to determine the best, safest, most human, fair, and industrious way to use credit and the granting of credit for the benefit of our industry, our small business, our economic sovereignty, and for the benefit of the interests of each and every consumer in Canada. We intend to bring that perspective to the committee in a constructive way.
Indeed, on second reading, we will have a number of speakers who will be going into more depth on the points on which 1 have only been able to touch. I would like to give the minister a word, not of warning, but of assurance, that we intend to see that this legislation is understandable to Canadians, that it provides them with protection, and that it is a piece of legislation in which they, not simply the banks, will have a great deal of confidence for the next ten years to come.


Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, this is the second time that 1 participate in a go-around on the Bank Act. It is too bad that the hon. member for Broadview-Greenwood (Mr. Rae) has been called away from the chamber because I think perhaps one could offer him, considering his enthusiasm and recent arrival in this House, some words of caution and advice with regard to the Bank Act.
It has been over a year since I have had an opportunity to address this House. I would like to make a few preliminary remarks before I get into a fairly extensive examination of the legislation which is before us and the reports of the committee that laboured very greatly, certainly on the basis of two major parties in the House, in producing the report of the Standing
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Committee on Finance, Trade and Economic Affairs, which appeared in Votes and Proceedings of March 20, 1979.
I find it strange, while I look at the benches across the way, with hon. members dispersed in their own seats, that there is a tendency in this House-and it is not done here as far as I am concerned-for hon. members to gather behind a speaking member in order to background an attendance in the House. We have a TV flying squad. I could not care less how many members there are sitting behind me. If that camera is aimed in this direction, the television will show no members, but myself.
I am passing on my reflection on the matter as a result of a number of years in this House-and I have spoken to other members who have the same feeling-feeling that the appearance of television in this chamber has changed greatly the concept, the behaviour, and so much of this chamber. This is no longer the forum where hon. members speak to fellow elected members. This has become a stage where people with claques respond because an hon. member has risen to ask a simple question during question period. Why? Clapping used to be an ironic gesture at times in support of a member who had risen perhaps 20 times or more in an attempt to catch the eye of Mr. Speaker. There was this ironic cheer that he had finally made it, but now we have a claque. Why?
Is this a stage or a hippodrome where some people are coming on for return so that there must be all this clapping? It seems to me to be a total debasement of this chamber, and it should not be a practice that continues. It is something new in this session, and I will pass my judgment on it. I do not like it, and it is not in keeping with this chamber, nor do I think that these travelling squads are in keeping with the chamber.
The third point which I would like to make deals with a matter which I have raised in committees in the past and which I have discussed privately with a good number of members. That is the practice which has grown up in the past three years of Mr. Speaker occupying the chair primarily for the question period, the votes, and occasionally to come in to deliver a ruling. Mr. Deputy Speaker or the Assistant Chairman of Committee of the Whole-


John Leslie Evans: I have a point of order, Mr. Speaker. It is very difficult for me to interrupt the golden oratory coming from the other side of the House, but I fail to see where this commentary has any relevance whatsoever to the Bank Act which is before the House.


Some hon. Members:: Hear, hear!


Marcel Joseph Aimé Lambert: Mr. Speaker, I had indicated that I intended to deliver a few remarks. The hon. member during the last session had an opportunity-


John Leslie Evans: Mr. Speaker, on the same point of order, to my knowledge there is no provision in Standing Orders which gives the hon. member the right to make a few remarks that go on for 15 minutes.

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Marcel Joseph Aimé Lambert: I have only been on for four minutes so far. The hon. member is pretty thin, because we listened to him speak out of order in extenso last fall on a number of bills. Be that as it may, I do not like the practice of the Deputy Speaker or the presiding officer sitting in judgment in the House, giving rulings on procedure, and then, when the debate is terminated, going out and voting. It is not done.


The Acting Speaker (Mr. Blaker):: I have listened with some interest to the hon. member for Edmonton West (Mr. Lambert). I might say, for the benefit of other hon. members, that he indicated before taking the floor that he had an interest in this subject. The last matter he raised was with the Chair itself. It was somewhat hesitant about interrupting his thoughts on that matter. I think he has now placed on the record some observations that may be worthy of hon. members' attention. I can now ask the hon. member if he would address himself to the Bank Act.


David Michael Collenette: I rise on a point of order, Mr. Speaker, I did not want to intervene, but I would think that the remarks just made by the hon. member for Edmonton West (Mr. Lambert) reflect upon the ability of the Chair to continue to preside. Before he continues, I would ask that he withdraw those remarks which cast aspersions on Your Honour.


The Acting Speaker (Mr. Blaker):: I do not think that the Parliamentary Secretary to the President of the Privy Council (Mr. Collenette) has raised a point of order. In any event, such comments as have been made by the hon. member for Edmonton West do not, in the opinion of the Chair, cast any aspersions.


Marcel Joseph Aimé Lambert: That is fine, thank you, Mr. Speaker. I shall just find another way to make the remarks I intend to make on that subject.
This afternoon it is indeed unfortunate, in some ways, that this debate came on. I indicated to the President of the Privy Council (Mr. Pinard) that the change in the order of business caught some of us at an awkward time. There are not too many members of the House who are veterans of the Second World War, and those who are were looking forward to attending the screening of the film, "The Liberation of Holland", which took place at four o'clock this afternoon. However, those of us who have responsibilities in the House regarding this legislation are aware that our rightful place is here, so we had to deny ourselves the opportunity of attending the screening in company with the Minister of Veterans Affairs (Mr. MacDonald) and others.
I, too, Mr. Speaker, would like to join in the sentiments the minister expressed this afternoon regarding the participation of Canadian troops in the liberation of Scotland, an event which will be celebrated at the beginning of the week.


Allan Joseph MacEachen: Scotland!


Marcel Joseph Aimé Lambert: Holland. I am afraid the Minister of Finance (Mr. MacEachen) would rise in indignation and I apologize to him if I were to suggest that Scotland has ever been subjugated. Maybe some people have felt Scotland has been subjugated, but no Scotsman has ever been subjugated. I do not know if that is a Freudian slip or not, Mr. Speaker-it was just one of those things.
This debate has been twice around the horn, Mr. Speaker. The last debate took place in late 1966 and early 1967. May I say that, based upon the experience of that time, I can assure both the Minister of State for Finance (Mr. Bussieres) and the Minister of Finance that there is going to have to be a Bank Act continuation bill.
According to my calculations, if the House does not sit on May 19, June 24 or July 1, then at one minute after midnight on July 10-I may be out a day but it will be one minute after midnight around that date-Canadian banks will not be able to open their doors unless there has been passed by both chambers, and promulgated, a Bank Act continuation bill.
The reason I say that, without even indicating that there is going to be an extraordinarily long debate in this House, is that even with the best of intentions it would not be possible to meet the deadline. There are pages and pages of regulations made under various sections of the act which are published simultaneously with proclamation. Sixty business days are provided in which the public may make recommendations to the government and so too may members of Parliament, I presume, with regard to the regulations. There is no way the banks can operate under a Bank Act with this multitude of regulations in suspense.
For instance, there are regulations with regard to leasing, regulations covering the operations of affiliates and subsidiaries of foreign banks, and any number of other regulations, which, of course, may be modified at committee or as a result of private representations to the government before and after proclamation. In all honesty, Mr. Speaker, I cannot see how anyone can anticipate the date being before November 1. It could be January 1 and that might be better, in order to give the banks the opportunity to conform. Some of them are going to have to modify their positions as a result of this legislation.
The hon. member for Winnipeg North Centre (Mr. Knowles) may remember, as I do, that early in 1967 the Bank Act was passed, and was proclaimed, but was to be effective on July 1, 1967. All this is by way of advice, Mr. Speaker. It would make things much more comfortable for Parliament. Our colleagues on the left, incidentally, are now apparently filled with "wim and wigour", but at committee hearings they distinguished themselves by almost total absence. I do not know whether they have a belated conversion to some views, or what.
The revision of the Bank Act is almost three years over due, and I suggest it will be three and one half years over due before we are through.
During the committee hearings I found a phrase which I think was apposite and I do not apologize for using it. I think
May 1, 1980

in many ways that what we are doing here is akin to laying down the rules for the manufacture of horse collars in an age of jet propulsion, rockets, and advanced electronics.
We have been putting up a fence to contain the encroachment of foreign banks. If we look at the proceedings of the committee in 1966 we see that 1, for one, asked the minister of finance of the day and the superintendent of banks at that time to do something about the comprehensive Bank Act which would allow foreign banks in for competition. We went through a gestation period with one foreign bank at that time, the Mercantile Bank. How that exercised the committee and the country, Mr. Speaker, when all it did was shore up one particular banking operation very soon thereafter! Because the market attracted them and the Canadian banking system did not have the facilities themselves, we had British merchant bankers, representatives of French banks and German banks and, of course, branches, in essence, of American banks.
May I call it six o'clock, Mr. Speaker?


The Acting Speaker (Mr. Blaker):: It being six o'clock, I do now leave the chair until eight o'clock this evening.
At six o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
Marcel Joseph Aimé Lambert: Mr. Speaker, at the six o'clock adjournment I was speaking about what the tendency has been on this occasion and in fact on the previous occasion when major revisions of the Bank Act went through, but in particular on this occasion. We are merely legislating to cover deficiencies and anomalies of the past, rather than what 1 would like to see, and I think that the majority of members on my side of the House would like to see, that is, legislating for the next 25 years in the future with regard to the banking system of Canada. I do not share the views of the now absent New Democratic Party.


Some hon. Members:: Oh, oh!


Marcel Joseph Aimé Lambert: But I want to say this: as they take some views, we take different views-


Some hon. Members:: Hear, hear!


An hon. Member:: Here is the cream of the crop.


Marcel Joseph Aimé Lambert: -with regards to the importance of the framework of our financial system here in Canada.
I remember in 1966 insisting upon provisions for merchant banking. The former member for Eglinton, Mr. Sharp, who was then the minister of finance, and the then inspector general of banks, would not hear of it, but we have seen merchant bankers move into our Canadian economy. What we
Bank Act
are doing now with this act is trying to put containing fences around them. We are talking about limiting the banks in data processing. We are talking about limiting the banks in the leasing of equipment. In 1966, and 1967, the banks warned us, and we were told by witnesses, that the only way you could, at that time, finance the leasing of major ticket equipment in this country was through major American subsidiaries. Frankly, we had the courage in 1966 of supine individuals with wet noodles for a spine in so far as it came to banking. Today we are doing the same thing.
I have been connected with the examination and the study of our financial system for over 20 years in this House, and I will confess that my early career was as a bank clerk but I could not stand the dull mechanics of it. I put a challenge to this government, as I did to my own administration, and I have here before all of this House the first carbon copy of a letter of my commentaries with regard to the Bank Act on the bill presented by my colleague, the hon. member for St. John's West (Mr. Crosbie), who was then the minister of finance. It is less than it was against that of the hon. member from Shawinigan who was the then minister of finance.


Mr. Kaplan:: It was the same bill.


Marcel Joseph Aimé Lambert: But I simply say-and the Solicitor General (Mr. Kaplan) will know because he was chairman of the committee of which I was a member-that our biggest problem is that we have been too timid with our bank system, our financial system. We do not gear for the future. We are merely trying to shore up for the past; contain the present, and then God help us in the future.
It is alleged that the Canadian Payments Association, or system, is going to provide the necessary vehicle for the electronic transfer of funds. That is nonsense. It is too limiting.
1 do not think that what we have in this act provides us with the proper vehicle for the Minister of Finance to discharge his constitutional duties properly where he is given exclusive jurisdiction, or the Parliament of Canada is given exclusive jurisdiction, over money and banking. My old expression of wet noodle courage in 1966 motivated the then administration not to insist upon its exclusive jurisdiction in monetary policy and in banking with regard to deposit insurance and, secondly, with regard to that which is banking.
What is wrong with this act is right at the core, at the guts of it. It refuses to define the business of banking, yet it has the gall to use the phrase "of business and banking". I, as a solicitor, and I do not apologize for the number of solicitors in this House because I think they reflect the right thinking of the Canadian public-


Some hon. Members:: Oh, oh!


Marcel Joseph Aimé Lambert: Jealousy will get no one anywhere.


An hon. Member:: You are living proof of that.

May 1, 1980
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Marcel Joseph Aimé Lambert: If any individual representing financial interests, or an individual trying to put together financial interests, were to come into the office of a solicitor engaged in corporate business practice and say, "We want to carry out certain operations. Can you tell us whether they infringe the restrictions on the business of banking?" An honest solicitor would say, "I cannot tell you because section 295 of the act says that a non-financial affiliate of a foreign corporation cannot engage in the business of banking." Well, what on earth is the business of banking? At 5.30 or thereabouts the hon. member for Broadview-Greenwood quoted from a Manitoba judgment. I think that judgment is out to lunch.


An hon. Member:: So are the NDP.


Marcel Joseph Aimé Lambert: No, the judge was. He said the business of banking is that which bankers carry out. In Alberta we have Alberta treasury branches. They carry out every function that a chartered bank does, and they sell gaming licences. At one time they took your picture for your driver's licence. Are those the functions of a banker? No, no, no.
I invite hon. members to look at the deliberations of the committee on finance which culminated in the March 20 report presented to this House on behalf of the committee by the present Solicitor General. He will admit it is a good report. In fact he pops his vest buttons that it is a good report.
The first item in that report insisted that banking should be defined in the act. I can tell the minister that I went looking for that and I got the recommendations and the festimony from most reputable witnesses on behalf of the Canadian bar, the bankers' association, the manufacturers' association, all types of organizations, and they are not generic when I name those, and private individuals. They said the business of banking had to be defined in the same way that the term deposit has to be defined.
People assume, for instance, that in a deposit with the trust company, that money on deposit with the trust company is on deposit. It is not. It is money left in trust with a trust company. It is not a deposit in the same sense as it is with a bank because those funds cannot be expended for any purpose. They are directly returnable to the individual who left them with the trust company, but the act refuses to define deposits.
These are two fundamental lacunae. I was told that defining the business of banking might excite some of the provinces. I will repeat the argument that I have made time and time again. The fact that a provincial administration incorporates a trust company and that it has jurisdiction over certain credit unions, does not give it jurisdiction over the operations of that institution or that society if that society, institution or corporate body engages in the business of banking, any more than a company incorporated under provincial statute for the operation of aircraft. They all come under the Ministry of Transport. There is not one scintilla of the operations of that company, other than filing its annual return, naming its directors and its shareholders, that a province can control. The same is the case with a broadcasting company. They are incorporated under a provincial charter. They name their
directors, they file their annual statements, but again not one scintilla of their operations come under provincial control.
A grain marketing company is incorporated under provincial charter but again not one scintilla of its operations comes under provincial control. Its employees are under the Canada Labour Code. A trucking company that crosses a provincial boundary, again its operations to truck are under sound federal control. Its employees are under the Canada Labour Code. Why, then, do we come around suddenly to recognize that organizations engaged in the business of money and banking incorporated under a provincial charter somehow or other have a totally provincial concept? To my mind, that defeats logic.
When we consider that over 35 per cent of moneys on deposit today, and presumably almost the same amount of chequing operations, are drawn through the near banks and the money lending operations, where is the determination of monetary policy which, under the constitution, is assigned to the Minister of Finance? Where is the determination that money and banking are exclusively jurisdictions of the Government of Canada? I would expect, by the same logic, the provincial governments to insist that education and a few other fields come exclusively within provincial jurisdiction. But with regard to money and banking the position is clear under the Bank Act and associated legislation dealing with monetary policy. I may be a hardliner and I am not too sure that all my hon. friends share this view.
This afternoon we heard the hon. member for Broadview-Greenwood arguing that the Bank Act is a multi-purpose document. I do not recognize it exclusively as a social document, as he and his hon. friends tend to do. In fact I think they are "out to lunch" in opposing quid pro quo, as one might say, labour policy against monetary policy. By that, I mean the organization of our monetary institutions. To my mind, it is illogical, it is hare-brained, and destined to failure. I think it is-


An hon. Member:: A dangerous move to the left!


Marcel Joseph Aimé Lambert: Members over there may laugh, but I am bearing in mind the contributions of that group on the left during the last determination of these issues. Perhaps I might quote to them the words of their former financial critic at the time 1 was finance critic for my party-he is somewhat of a revered institution in that party or, at any rate, he should be to a lot of its younger members. I refer to the former hon. member for Waterloo. He used to say, "Marcel, when you have covered a bill there is nothing much left to say."


Some hon. Members:: Hear, hear!


Marcel Joseph Aimé Lambert: I am going to review these documents at some length, Mr. Speaker. This is an omnibus bill, a huge, massive thing, and for the benefit of the television audience tonight I am going to show it.
May 1, 1980


An hon. Member:: You are not supposed to be talking to the television cameras.


Marcel Joseph Aimé Lambert: 1 know. But some of the hon. members here might as well be part of that television audience because, frankly, I do not believe they have looked at this bill in its entirety. It is in four parts.


An hon. Member:: Read it.


Marcel Joseph Aimé Lambert: The hon. member may die of old age-and it is premature old age because he is still young in appearance- and in mentality.


Some hon. Members:: Oh, oh!


Marcel Joseph Aimé Lambert: There is the Bank Act. Incidentally, the Bank Act is not just a general act, it serves as the equivalent of a memorandum of association or letters patent of all existing chartered banks and it is not, therefore, a document to be treated lightly. It is the charter of their operations. Then there are amendments to the Quebec Savings Banks Act which cover only one institution, the Montreal District Savings Bank. Then there are amendments to the Bank of Canada Act, and finally there is part IV which deals with the creation of the Canadian Payments Association. This in itself is a most complex and difficult study because it is the point of departure as far as the whole business of this legislation is concerned.
I do not intend to talk at this moment about part IV, though. I want to talk about the Bank Act and, as I said, I want to talk about the report of the committee of this House tabled a little over a year ago which, incidentally, was about 80 per cent incorporated by the Department of Finance and put together in the presence and with the co-operation of the Inspector General of Banks. A lot of the points were negotiated with him. I can tell you, Mr. Speaker, and the Solicitor General will tell you, that members both on this side and on the other side of the House, in the spirit of putting together a workable document, negotiated privately and arrived at a consensus, a communality of opinion. The administration which took office in June of last year did not entirely share our views in certain respects. They had the benefit of the views of our colleagues in the Senate whose opinions may have varied from ours. We do not claim we have a monopoly on sagacity. But we believe we arrived at a pretty fair solution. I should like to outline to the House the areas in which we take issue with the present bill and the former administration.
First, as to the business of banking. I have often looked upon government on the national scene as though it were a referee in a hockey game-I understand there are some hockey games starting just about now. We have all watched professional hockey, and we have always known that if the referee in the first period is lackadaisical and allows elbows, high sticks, boarding, and generally rough play, by the second period the boys are into the act and the situation is no longer under control. The situation has got beyond him, and we have precisely the same situation here.
Bank Act
By the refusal of the Parliament of Canada to define the business of banking we have allowed chaos to pile upon chaos, and precisely for those policies that the New Democrats would like to see, the Government of Canada is as impotent as a eunuch to act because there has been a refusal to define the business of banking and the word "deposit". So the Government of Canada says, "This is the jurisdiction with regard to money and banking. Let it be known." It has been sniped at, it has been pulled at, and, frankly, what have we got? Oh, the chartered banks' operations work rather well, but I invite the hon. minister to go into Montreal, Toronto, Calgary, Edmonton or Vancouver-I think I have named the five principal financial centres in the country-to see the foreign banks operating, from one extent-the suitcase operators-all the way through to the 15 or 18 branches of the Bank of America in Newfoundland, not under the name of the Bank of America but the First America.
What do we say about the Bank of Paris in Montreal, Calgary and maybe elsewhere?
And what do we say about the Bank of The Netherlands and the Bank of Switzerland in Montreal? Mr. Speaker, 1 do not object to the operations of those people.

One of my colleagues is going to talk about the financing of heavy construction equipment and the foreign bank agency which was the only one which was able to take it on because it quoted a lower price. That is competition, and a number of managers in our chartered banks have told me they were beat out on this deal or that deal by representatives of foreign banking interests. The problem there is that neither side is protected. It is the black market of finance. Neither is the foreign banking operator protected by supervision, and particularly by the representatives from the left who seem to think that everything has to be on the tabletop so they can examine all the guts. I do not know what visceral satisfaction they get out of it, but they cannot see the operations of these foreign banking interests.
Our Canadian clients are not protected. You do not know what sort of deal they are in, and when I look at foreign banking interests and talk to them, as I have done with the Swiss, I ask, "What protection have you got here? You are not under any act. You do not have section 88. You have nothing except taking action in one of our courts against possibly a man of straw".
"Yes", they say, and I say, "All right, and how does that affect your interest rate?"
"Well, we protect ourselves against that". So therefore where do you think bridging loans or factoring gets to except at higher interest rates, which are a protection against risk? And who supports the bottom line? The Canadian enterpriser, who has to resort to that. And who then picks up the real bottom line but the Canadian consumer?

May 1, 1980
Bank Act
This policy with regard to banking is about as stupid, illogical and unenlightened as our energy policy, where we subsidize Canadians to buy more of our disappearing energy resources so that we depend upon more foreign offshore resources on which we pay subsidies. Out of whose pocket? The Canadian. Talk about lunacy and idiocy! The Canadian economy has been put through the wringer of lunacy during the past few years on this particular score. It is the Canadian consumer who is paying for it all the way through, and now we are asking for a continuation. It is not quite so expensive. We are not spending $3.5 billion to subsidize the consumption of foreign oil at the expense of Canadians and Canadian companies-western Canadian companies primarily-and to subsidize United States tourists who daily fill up foreign air carriers which tank up.
Here are a few million dollars or a few hundred million dollars. Here is more, but it all adds up to a policy that is equivalent to that of the old Roman empires. Give the mobs bread and circuses, and they will elect you; until the Roman mob ate up the Roman emperors. We are doing it.
I want a banking system which will take care of the needs of Canadians financially. I want there to be Canadian merchant bankers. 1 want our chartered banks to be strong, and not just here in Canada. I want them to be able to go abroad without penalty and on the basis of reciprocity. We cannot expect other than that, but why hamstring our people? We have a Canadian characteristic that if a Canadian operation is satisfactory and making money, the best thing to do is to go out and hamstring it, either through the tax system or some other way. We have that niggardly spirit when it comes to our Canadian presence.
I am not going to point the political finger, but I can assure you that every step that is taken to penalize the initiative of Canadian corporate businesses or individuals is in the direction of giving the outsider encouragement and strength. In so far as the Canadian individual is concerned, he is condemned to ulcers, high blood pressure and worry, and then the ultimate knacker's axe because that is the way we consider Canadian initiative and enterprise, that is the way our tax system is designed.
People complain about the loopholes that apply to foreign corporations. God, I wish they would turn their attention to the damage that they do to our Canadian enterprise. Therefore I say that in so far as our Canadian banks and trust companies are concerned, and here I include federations and the credit unions because they have now reached the stage-I want to talk to them about their chartered bank which has its headquarters in my home city-they draw their funds in part from pension funds and credit unions. That is the Canadian Commercial. Then there is the Northland branch which is, frankly, a far more overt outlet into the banking field of funds accumulated by the federations and the other groupings of credit unions. That is where real money is made. Those two banks, in the discussion of whose charters I participated, are
good money makers, and so is the Bank of British Columbia, once we got the government of British Columbia off it. They are good and they are doing the job. They are three out of the four which have been incorporated since 1968. I appeal to hon. members in the House that we do not put unnatural hobbles on our financial system.
We are going to be able to consider a lot of amendments in the committee, I trust, but I do not see that many changes between this bill and the bill that was before us in December. Yes, there are a few changes, for instance, foreign banks having to go to cabinet-their minister having to go to cabinet-in order to establish another branch. That is nonsense. It is the Inspector General who should look after this. Why do you hire a watchdog and then do your own barking? Cabinet is too busy and has too many things on its plate, and it is ill-qualified by reason of the complexity of the work that it faces to be able to arrive at the right decision.
Let us say the Bank of America, which has many branches in Newfoundland, wants to establish another one in Nova Scotia in a shopping mall or in one of the major towns. Does it have to come to cabinet here? What utter nonsense! Let us take the case of Barclay's or the First National Bank of Seattle with its branch in Edmonton. It wants to establish another branch in Calgary. Why should it have to come to cabinet? That is one of the things we want to talk about in committee. It will require the mere change of one word, but the government went against the opinion of the committee on this.
There are some other matters about which we want to talk. 1 want to mention the fact that 8 per cent of Canadian assets of Canadian banks is the ceiling beyond which foreign banks cannot penetrate. What is so magical about 8 per cent? The committee proposed 10 per cent. I saw the government's reasoning in this regard, and, frankly, I do not buy it. We are not legislating for today with inflation at this high level, and we are not legislating for yesterday. Again we have this foolish nonsense of containment. Le me say to the minister, through you, Mr. Speaker, that we are legislating for the next 15 to 20 years. Why do we limit ourselves?
The Inspector General of Banks is the watchdog for government, and, thank goodness, in this act he is finally being given an active role. In the previous act-and I complained about it-he was the mere recipient of reports, a toothless dog. He admitted it, but the government of the day would not do a damn thing about it. Now, thank goodness, we have a more activist concept in the role of the Inspector General of Banks. In part we are meeting a social need. I am not one who believes that every group of self-appointed consumer activists should have the right to sit on the board of a bank or on the Canadian Payments Association. Gracious me, they do not realize that the chaos and the delays they cause ultimately add up to $2 on the bottom line where $1 had been the price before, but it gives them some self-satisfaction! Perhaps they love to see it in the headlines, I do not know, but it does not go that way.
May 1, 1980

Now I come to the question of incorporation. Until now it has been necessary to incorporate through a private bill. In many instances that is tough, but let me assure you that in the case of the Continental Bank, which is IEC's application, thank God it had to go through the sieve in the Commons committee. Our friends across the way, on the recommendation of the then inspector general of banks, allowed this through, with which I disagreed, and I am not recognized as a leftwinger in this House-


Some hon. Members:: Oh, oh!


Marcel Joseph Aimé Lambert: I found some things in that application that were absolutely repulsive, such as, for instance, that four directors of the Royal Bank were going to be directors of the Continental Bank. There was a whole bunch of things. Of course we sent them peddling their fish very quickly. My colleague from Nova Scotia says I must not peddle fish. The act was cleaned up, and I am glad to say that the Continental Bank is well launched today and in operation. I wish it every success in the world.
That pointed out the validity of an examination of the explanation by the Commons committee. If it had been passed merely on the examination by the Inspector General of Banks of the day with a recommendation to somebody, as he recommended to our colleagues in the Senate, we would have ended up with a Frankenstein monster.
It is now proposed that the letters patent route shall be used involving the Department of the Secretary of State and then the Inspector General of Banks. However, anybody and everybody can comment on such an application, but the Inspector General is not authorized to hold public hearings to obtain the pros and cons.
Any branch of the public service is the creation of legislation and holds only those powers granted to it by statute. The Inspector General cannot hold public hearings on the application of a bank. Anyone could comment, make smears, or we could even have an application such as the original Continental Bank application, yet the Inspector General has no power to receive representations in making an examination.
My colleagues on this side of the House and a sufficient number from the government side agreed with me on this point and we made such a recommendation in our committee report. Lo and behold, that has been one of the most sterile recommendations made.
The Inspector General of Banks must have the power to hold public hearings and to examine representations being made in respect of the incorporation of any bank, and in respect of the registration of any foreign bank. Surely that is fundamental. I can assure you, Mr. Minister, if my colleagues and I do not get our way in this regard, the passage of this bill will be a lot slower. We insist that there shall be the right of public examination, as we had under the parliamentary route, and we insist that there shall not be the quiet bureaucratic route.
Bank Act
The present Inspector General might well be the man who would want to do this the most, but he does not have the power to do so. His powers are defined by statute, and if the power is not defined there he cannot do it. I see the minister nodding his head and I assume he has taken note of my point. I would commend it to him as I am sure we are going to hear a great deal more in the future about the incorporation of banks.
I do not want to talk at length about co-operatives, as my colleague from Winnipeg will do so, but there are certain restrictions imposed upon co-operatives. I do not think that co-operatives today, whether combined or in any other form, should have the right to have directors on the board of a bank. The members of any other financial institution do not have that right to be directors of a bank.
The committee made recommendations to tidy up this aspect of the act. I hope to meet with representatives of co-operative societies in the next few days. I hope they do not misunderstand my point of view in this regard. I want to treat co-operatives as mature financial institutions, which they are. If they want to participate in the Canadian Payments Association, along with the big boys, they are going to behave like big boys. They insist that bank directors shall not be directors of trust or mortgage companies. The same should apply to directors of co-operative federations. Co-operative federations are financial organizations and their members cannot be directors of banks. What special status do they claim? Certainly the director of a federally incorporated trust company cannot be a director of a bank, and I agree with that principle. That must also be so in respect of the directors of co-operative federations such as caisses populaires and credit unions.
I have another bone that sticks in my craw. Why must Le Mouvement Desjardins own 25 per cent, or perhaps 27 per cent, of the share capital of the Banque Provinciale, when no other shareholder in the world is allowed to own more than 10 per cent of the shares of any of our chartered banks?
The bill provides for a grandfather clause. I would go much further than the hon. member on the other side on a personal basis. I do not want a grandfather clause. Le Mouvement Desjardins must be subject to the same treatment as the Dutch bank and the Mercantile. They should reduce their interest over a period of years because we cannot have this type of situation.

What does that mean now, the Mouvement Desjardins in the new National Bank? I am not familar with the distribution of shares but what does their proportion of 25 per cent to 27 per cent and here I am not entirely certain about their share in the Banque Provinciale-what does it mean, "in the National Bank?" Remember the National Bank is no longer the Banque Provinciale active only in Quebec but perhaps the bordering areas of Ontario, but in my riding there are branches of the National Bank which eventually would have reopened links with the French-speaking communities in our western cities for the former Bank Canadian National. So, Mr. Speaker, we need to have justice here. I said justice-no, rather equality. In

May 1, 1980
Bank Act
committee I will be moving an amendment to the act on the proportion of shares of a bank owned by a federation or any co-operative movement. After all, they would be the first one to object to a bank or a trust company having by any means 25 or 27 per cent equity in a co-operative movement. Those people are not kids. And I do not want to see them subjected to a floor or ceiling because the co-operative movement and the caisse populaires were set up primarily to fill a gap. There was healthy expansion and now they are very serious people. All the better for them but we have reached a point where the rules of conduct are the same for everyone except that they do not have the rights of the chartered banks nor do they have their responsibilities.
I see that the Inspector General of Banks has delivered his undertaking to the committee that there shall be adequate provision, in section 156(4), for the storage of computer data so as not to hamstring a great number of Canadian operators in this field. I think that the amendment which he has put forward is quite satisfactory. The committee simply said, "To define this precisely is impossible." They simply said that the presence of the data shall be disclosed to the inspector general and shall be readily accessible to him at all times, whether or not it is in the United States in data banks of a peculiar nature that cannot be duplicated, simply because we do not have the financial resources. The operations are too big. There are only two in North America. However, if the Inspector General of Banks knows where the data is and has access to it, then fine, because all the banks will agree on the matter. I would think that the provision has been adequate.
I do not wish to talk at great length about leasing. It is a subject that has excited a great deal of interest on both sides of the House. All I will simply say is that I think that, notwithstanding the regulations published in October, we have already seen efforts by some of the chartered banks, and presumably successfully, to get around the situation. The idea of the banks engaging in the business of leasing passenger vehicles and trucks up to a certain commercial weight will not fly, period. There is plenty of scope in the big ticket items because there is no way that we will continue that parody of earlier years, where people who are buying big ticket items were having to finance them through American financial institutions or having to go to the United States.
A 1416 yard front-wheel loader used in the oil business today can cost over half a million dollars a copy. One D-10 tractor is worth $650,000 in Canada today. Will we condemn our Canadian operators to leasing that equipment? In many instances it pays a great deal more to finance through a leasing agreement than having to purchase such a unit. If we throw the baby out with the bath water and prohibit the banks from engaging in leasing operations, we will merely drive Canadians who require this kind of equipment to financing through American resources and that, to me, has to be the height of stupidity.
I can agee with regard to ordinary automobiles and trucks up to a certain weight. I believe that the automobile dealers, the banks and the government, will ultimately agree on a ceiling figure. It may be 18,000 pounds, 9,000 kilos or so many tonnes capacity, but not a dollar value. Those unroad vehicles shall be limited to dealers to finance. They have done a good job. I can see where some of the abuses are coming up with regard to some of the projected operations of the chartered banks. That is enough on that field.
I would like to turn now to a last item because I wish my colleague from Mississauga to have an opportunity to address the House. It is believed that there is a grandfather situation right here, that there is no way that we can tell any foreign bank to get out of the country, providing, Mr. Minister, that the country of its domicile is prepared to enter into reciprocal agreements with us. The reciprocal agreement is the bottom line. There are many Japanese interests that want to enter into Toronto and western Canada, but Canadian banks, which have been knocking on the door of Japan for many years, must be able to enter on a reciprocal basis.

It is the same, but I believe that things are going rather well in France and also reasonably well in Switzerland. In Germany as well things are going fine because certain Canadian banks have purchased German banks and we have common interests. In the United States, the situation can vary; certain states are somewhat more difficult than others, but in general, things are going well.
However, as concerns other countries, I believe that if we developed this question of mutual interests among equals and if the inspector general were in a position to make a request in this regard and present a recommendation to the minister- and I do say a recommendation to the minister because I recognize that this must be done at the ministerial level-it is quite possible-and I have no doubt that my colleague from Esquimalt-Saanich shares my views on this subject-that financial relations would have an impact on foreign affairs. Therefore, there could be liaison at the ministerial level between external affairs and the Minister of Finance.
In this regard, I believe that the activity should remain at the ministerial level and not go any higher because in issues of this type we need flexibility instead of rigidity and all kinds of orders and regulations.


Mr. Simmons:: Mr. Speaker, I wonder if the hon. member would permit a question?


The Acting Speaker (Mr. Blaker):: Order, please. The hon. parliamentary secretary.


Roger Simmons: I am especially interested and, indeed, intrigued by what the hon. member for Edmonton West (Mr. May 1, 1980

Lambert) said a few moments ago about the need, in his view, to define-


The Acting Speaker (Mr. Blaker):: Order, please. Is the hon. parliamentary secretary raising a point of order?


Roger Simmons: No, I was going to raise a question, Mr. Speaker. 1 believe the hon. member yielded to my request to put a question.


The Acting Speaker (Mr. Blaker):: The hon. parliamentary secretary should realize that he may put his question and receive his answer with the unanimous consent of the House and consent of the hon. member.


Some hon. Members:: Agreed.


Roger Simmons: I was saying that 1 was quite interested in what the hon. member for Edmonton West had to say about the need to define "bank" and to have a definition in the legislation. The hon. member will agree, I am sure, that the bill before us is almost identical to Bill C-14, introduced by his colleagues in the Tory administration last fall. In view of the fact that they are so identical, will the hon. member for Edmonton West tell the House, and me in particular, if the lack of a definiton of "bank" is as glaring an omission as he says it is, and would he tell the House if he made this point then as well as he has tonight? Did he make it as eloquently then to his Tory colleagues when they were drafting Bill C-14? If he did, then did they subscribe to his logic? If they did not, could he indicate to the House why that was the case?


Marcel Joseph Aimé Lambert: Mr. Speaker, I am prepared to answer that. I did raise the question. I am not going to disclose in what endearing terms I couched my criticism. May I say, however, that I do not think it was in terms any more constrained than I would have made to the present Minister of Finance. Perhaps the hon. member does not know me, but if I am going to call someone an s.o.b. on one side of the House I will call-


John Leslie Evans: Mr. Speaker, a point of order-


Marcel Joseph Aimé Lambert: Come on! The hon. member for Ottawa Centre (Mr. Evans) should sit down. If I am going to call anyone in those terms-


The Acting Speaker (Mr. Blaker):: Order, please. I allowed the question and I am perhaps sorry to say that the hon. member for Ottawa Centre has raised a point of order.


An hon. Member:: He thought he heard his name taken in vain.


The Acting Speaker (Mr. Blaker):: I have to recognize the hon. member for Ottawa Centre.


John Leslie Evans: Mr. Speaker, my only question is about the term s.o.b. I think the interpretation of that expression is quite well known and would be unparliamentary.


An hon. Member:: Withdraw!
Bank Act


Marcel Joseph Aimé Lambert: I want to tell the young hon. member for Ottawa Centre that in the department of defence an s.o.b. is known as a "substitute order of battle".


Some hon. Members:: Hear, hear!


The Acting Speaker (Mr. Blaker):: The Chair does not mind these interruptions as long as hon. members accept the fact that there ought to be some order in the proceedings. If the hon. member for Edmonton West wants to go on with his definition, that is up to him, but in due course 1 shall have to rule one or the other or both out of order.


Marcel Joseph Aimé Lambert: I think the hon. member for Ottawa Centre recognizes that he was entirely out of order. I will give him another definition of s.o.b. As my colleague, the hon. member for Central Nova (Mr. MacKay) says, it is "serene old boy".


An hon. Member:: Quit while you are behind.


Marcel Joseph Aimé Lambert: Mr. Speaker, I am interested in the Bank Act. I do not care who was on the receiving end of the criticism. It is constructive criticism, and it is well-known criticism. I am satisfied that it was received in the spirit it was given-on a constructive basis. I am satisfied that the Minister of Justice (Mr. Chretien), when he was minister of finance in a former government, received this type of criticism from me in the spirit in which it was offered. I trust that the Minister of Finance today will receive the suggestion in the same way, and I think the hon. member need not worry on that score.
I shall continue my speech, Mr. Speaker, and if I have time at the end, I shall answer the hon. member.


Roger Simmons: One further question-


Marcel Joseph Aimé Lambert: No. I want to leave time for one of my colleagues, and I have just a few minutes left.
The last point 1 wish to make concerns the Canadian Payments Association. It is a new departure, and I am not personally satisfied as to its import. I have a feeling that it is just another facet of the interventionist philosophy of this government. I think that is because the Canadian Payments Association will be under the chairmanship of some employee of the Bank of Canada, named by the Bank of Canada. How else could they get their finger in the pie? Until the present time the Canadian Payments Association or a clearing system has worked very well through the chartered banks. As a former employee of a bank I know that no system is any more strictly policed than it is. One of the difficulties is that the near banks have to clean up their act. Their administration is sloppy; that is why they are cavilling against some of the strictures of the clearing association.
If the idea is to substitute the Canadian Clearing Association so that some of the near banks feel that they can pay the cost of participation in clearing on their own account and can meet their responsibilities, that is fine, they have matured. At the time of the committee hearings, however, it was our information that not one of the organizations, apart from the chartered banks was prepared to enter into the clearing system
638

May 1, 1980
Bank Act
as independents, yet they wanted seats on the board of directors. I simply say that if they want a role in the policy determination of an organization, they should pay their dues and assume their responsibilities. There is no free ride for these things. I have an intimation that there are some of the near banks which in the last three years have now grown to a point where they are prepared to come in. Fine, we will see. I hope this will come up.
In closing this particular stage of my intervention with regard to the Bank Act, basically I commend this act to this House. There are some difficulties in some of the provisions. I think I have made the House aware of some of them. I trust we can get a flexibility on the part of the administration where it will be prepared to accept amendments. This is one of the biggest problems with the Canadian committee system that ministers enter committees with their minds made up: thou shalt not yield one inch. Of course, it makes a mockery of the whole operation. The opposition are not out to do dirt to the administration of Canadian affairs. If we have a good idea, and God knows government does not have a monopoly on good ideas, but whether a good idea comes from the New Democrats or whether a good idea comes from this side for an amendment to the legislation, then a sensible minister should be prepared to accept it.
1 hope that 1 have been pretty strong in some of my criticism tonight but may I assure the Minister of State for Finance (Mr. Bussieres), and the Minister of Finance that 1 and my colleagues on this side, in so far as the Bank Act is concerned, are motivated by the best interests of the country at large.
In closing I ask: will the ministry please at this stage consider the calling of a royal commission on banking and financial institutions at the earliest possible date? The Hon. John Turner accepted my proposal personally in 1972 but he could not get his colleagues to agree. The net result is that we have been legislating for the manufacturing of horse collars. Let us legislate the next time around-I do not expect that I will be here, but the good Lord might inflict me on you-


Some hon. Members:: We will be here.


Marcel Joseph Aimé Lambert: -but let this House be in a position the next time it is considering the Bank Act to base its consideration upon a fulsome document based on the requirements of this country for the next 25 years, and not merely to shore up the deficiencies of the past, put up containing fences, and therefore do half a job.
I thank the House for its consideration in hearing me for this rather lengthy period, but may I assure you, Mr. Speaker, that if there has been anything that has been near to my heart all these years in this House of Commons, it is having proper banking and financial legislation. We are far from it now, but God willing we will get to it.


Some hon. Members:: Hear, hear!


Roger Simmons: Mr. Speaker, I should like to say a few words on this particular bill. As I mentioned in my question to the hon. member for Edmonton West (Mr. Lambert), I was rather intrigued by his comments on the need for a definition of banking in the legislation. I listened for some time, indeed throughout his entire speech, hoping that we would hear from him, with his undoubted knowledge in the area, something by way of his version of the definition; in other words, what it ought to be in his view. Of course, we did not hear it.
It is very easy to point the finger and talk about what is wrong with something. It is a little more difficult, and it requires a little more responsibility to offer an alternative. I heard no alternatives in the comments of the hon. member for Edmonton West during the past hour or so. He did admit in responding to my question a few moments ago that he had no more success, that his batting average was as abysmally poor with the Tory minister of finance as it was with the former Liberal minister of finance, the hon. member for Saint-Mau-rice (Mr. Chretien), and as abysmally poor, I assure him, as it is going to be with the present Minister of Finance (Mr. MacEachen).
In the very eloquent statements made by the hon. member for Edmonton West there are a few glaring holes and a few weaknesses in the arguments that need to be addressed. When the hon. member calls so piously for a definition to be incorporated in the act, he does not pursue it. He does not analyse what some of the ramifications will be.


Marcel Joseph Aimé Lambert: Do you want me to go for another hour?


Roger Simmons: Not particularly, I say to the hon. member. But if in that hour we could get a definition, then at least that hour would be much more profitable than the last hour and a half. I invite him to speak. I am prepared to suspend the rules if other members will. I invite him to get up if he has a definition.


An hon. Member:: Enough is enough.


Roger Simmons: I agree enough is enough, but a little suffering, as my friend from St. John's says, is short-term pain for long-term gain, and I suppose we could endure him for another hour if it meant that we got a definition that has eluded us and eluded legislators for 110 years.


Walter David Baker: Have you got it?


Roger Simmons: Not only has he got it, Mr. Speaker, but he hoards it. He will not give it to us. Second, he may well be prepared to-I would hope indeed that he is prepared to-but he is not giving us his point of view in terms of what some of the ramifications will be.
For example, I ask him the question what will be the implications if we incorporate in the Bank Act a definition, as he advocates, for the trust companies? Does he want to throw the trust companies, the caisses populaires in Quebec, the

May 1, 1980

credit unions, into chaos? Does he want now, by bringing into the Bank Act a definition of banking, to remove the provincial jurisdiction as it relates to trust companies, credit unions, caisses populaires? Is that what he is saying? If so, I hope his leader is listening. Because what he is saying in effect is that in matters of banking, in matters relating to credit unions, caisses populaires and trust companies, he wants to fly in the face of the stated policy of his party of giving it all away to the provinces. On this one he wants to do an about face. He does not want to pursue the stated and demonstrated policies of his leader and his party of giving more and more to the provinces, to the point where one wonders if the Tory administration had existed in power for another year or so if we would have had anything left to call a federation.
1 wonder if at times when the hon. gentlemen opposite were in office, if they ever grasped the difference between a common market-a free association of a number of states for economic reasons-the difference between a common market and a federation. What they were talking about and demonstrating on a number of points had nothing to do with a federal system whatsoever.
Now there is a peep of hope, a little glimmer from the hon. member from Edmonton West. He tells us all is not lost in the Tory party, at least in the matter of banking, trust companies, caisses populaires and credit unions. He wants the Tory party to step back from the brink, to become a little more centralist. He wants the Tory party to remove from provincial jurisdiction their present ability to give life to licence, to authorize the operation of caisses populaires and credit unions. He wants to do away with that.
He wants to put a definition of banking in the act that woulcj in effect have the federal power, as provided for in the BNAI Act in our constitution, have the federal power declared in effect as it is in the words of the constitution right now. That 'is what he is advocating. That perhaps is one of the very good reasons why he really skirted the issue and never did talk about a definition.


Marcel Joseph Aimé Lambert: Come to the committee and 1 will talk to you.


Roger Simmons: I will be glad to talk to the hon. member in Committee. I promise him I will be there. He may not remember, but he and I talked a couple of years ago in August when we tripped up to Fort MacMurray during the parliamentary conference. He and I had a good conversation then about a number of matters. I got some insight into the tar sands, thanks to him. I am sure if I talk to him I will get a fair amount of insight into banking. I will not assure the hon. member I will listen to everything he says. I may not agree with all he says, but I will do something more than his colleague just behind him is doing. I will listen to him. I will at least listen to what he is saying.
That is more than the Tory party did to him when they were in power and when they were drafting Bill C-14. They might have listened, but they did not heed very much. They might
Bank Act
have listened. Courtesy knows some real strains. One has to do a lot in the name of courtesy. Did they heed the advice? If so, I say to the hon. member for Edmonton West, where is the proof? I invite him to dig up Bill C-14 introduced by the Tories last fall during that mercifully brief period they were in power. Dig it up.


Marcel Joseph Aimé Lambert: The hon. member knows that the bill that was introduced by the former minister of finance-


Some hon. Members:: Order!


Roger Simmons: Mr. Speaker, of course I will permit a question.


Mr. Deputy Speaker:: The hon. member for Edmonton West wishes to ask a question.


Marcel Joseph Aimé Lambert: If hon. gentlemen would not close their ears, I ask the hon. member did he compare the bill presented by the hon. member from Shawinigan, now the Minister of Justice (Mr. Chretien), when he was minister of finance, with the bill that was presented in December by the hon. member for St. John's West (Mr. Crosbie) and then take as abridged the committee report, and he will see that the Conservative bill accepted 80 per cent of the recommendations of the committee of the House? Then he may ask the Solicitor General (Mr. Kaplan), who is the inspiration for most of the changes in the original bill as represented by the committee report-my colleagues and I-


Mr. Deputy Speaker:: Order.


Roger Simmons: Mr. Speaker, I will be glad to respond to the question, such as it was. I heard the hon. member ask, among other things, whether I had compared the bill of the now Minister of Justice which he sponsored as minister of finance in 1976 with Bill C-14 of the Tory administration last December. I say to the gentleman from Edmonton West that in 1976 I was so terribly busy in the Newfoundland House of Assembly trying to keep his now colleague, the hon. member for St. John's West, straight, that I frankly admit that, no, I did not compare the two pieces of legislation.


Some hon. Members:: Hear, hear!


Marcel Joseph Aimé Lambert: That was in 1978.


Roger Simmons: I am here just barely. I was here a few days in December and seven days after "you shut her down on me".
I have been here fourteen days as of tonight in this session, twice as long. I just want to give my friend a chance to hear himself.


Mr. Deputy Speaker:: The Parliamentary Secretary has the floor. Would he continue with his speech?


Roger Simmons: I cannot tell the hon. member for Edmonton West who was the inspiration. I can tell him I had a chat with the Solicitor General and I know who was not the inspiration, but that is another issue. This bill before the House compares

May 1, 1980
Bank Act
almost identically to Bill C-14 which the Tories introduced in December, almost identically.


Mark Willson Rose: Are you proud of that?


Roger Simmons: What I want to know from the hon. member for Edmonton West, if he suggests that he indeed was the inspiration, is why his inspiring argument about definitions for banking did not get through to the Tory minister of finance. To hear him talk tonight, that seems to be the central problem with our banking legislation, a lack of definition. 1 hope in time he will provide the House with an answer to that particular question.
My friends in the instant solution party-


Mark Willson Rose: Nice to see you recover.


Roger Simmons: That is more than I can say for the hon. member. My friend in the party of instant solutions scoffs because there are a lot of similarities in the two bills.


Mark Willson Rose: I didn't.


Roger Simmons: I said almost identical.


Mark Willson Rose: You are damn right.


Stanley Howard Knowles: Order.


Roger Simmons: This bill does take into account most of the considerations of the House committee and Senate committee. We have heard in the last two or three years all kinds of representations on the white papers and the previous revisions of the act. There has been exhaustive consultation, negotiation and modification. As the hon. member for Edmonton West says, he was an integral part of that consultation. He was on that particular committee. He provided a very important voice on that committee.
1 come for a moment to the question of foreign banks. It should be pointed out, when we talk about foreign banks, that they are not under federal control as such because we have not asserted our power which is in the constitution with respect to banking; banking is clearly a federal area of jurisdiction. They are operating in Canada, but they are not under federal control. They are under provincial control.
The Bank Act, to which we are proposing revisions tonight, will ensure uniform federal control without, at the same time, I say to the hon. member for Edmonton West, cutting the legs under trust companies, caisses populaires and credit unions. That is not nor will it be our policy. We will listen to the hon. member for Edmonton West, but we will not follow his advice on that matter. We cannot afford to do so. We will not cut the legs under the credit unions and trust companies. We shall not do it no matter how eloquently, how loudly, how endlessly he talks.
This revision will have the effect of increasing banking competition, and I believe it will lead to better service for business borrowers. It will mean that our banks will have access to foreign markets. I hope everyone in this House is
proud of the degree to which the Canadian banking system, because of its stability, because of its international recognition-


Raymond John Skelly: Loans to Cuba!


Mr. Prud'homme:: I do not think they are proud of them over there.


Roger Simmons: Well, I am proud that our banks are providing leadership around the world. I don't expect the socialists to be proud of it, though. In fact I have yet to find very much that they are proud of. They are so busy knocking everything that they have no time, anyway, and if they are not knocking things they are advancing instant solutions to things-tonight, the interest rate, tomorrow, inflation or something else.


An hon. Member:: You have said that before.


Roger Simmons: Yes, and I want to say it again because it takes a little time for the people I am talking about to understand it.


Mr. Blaikie:: You have learned nothing in 113 years.


Roger Simmons: Mr. Speaker, allow me abjectly to apologize for all my sins in the last 113 years. Now the hon. member wants me to carry on my shoulders all the problems of the last 113 years. Talk about instant solutions!


An hon. Member:: You never change.


Roger Simmons: We change, Mr. Speaker. We have changed in Newfoundland. We rooted out the socialists down there. We did the same thing in Nova Scotia, and we are going to do it out west.


Some hon. Members:: Hear, hear!


Stanley Howard Knowles: Your speech was funny the first time I heard it.


Roger Simmons: The hon. member was awake the first time he heard it.


Stanley Howard Knowles: This is the third time. It is losing its punch.


George Albert Proud: How did you remain here for so long?


Roger Simmons: I thank the hon. member for coming back so often to hear me. He likes it so much that this is the third time, he says.
This legislation allows easier access into the banking system. I believe it will lead to greater competition and that it will allow existing financial intermediaries to widen their scope and compete more effectively in the marketplace. Do hon. members of the socialist party say this should not be the case, that these financial intermediaries should not have wider scope and be able to compete? Are they against that, now?


George Albert Proud: Of course. They are against everything.
May 1, 1980


An hon. Member:: Clarify that.


Roger Simmons: There are many aspects of the bill which commend themselves to the House.


Walter David Baker: Mention some of them.


Roger Simmons: For example, the provisions dealing with leasing. The proposed legislation calls for leasing to be restricted to the equivalent of credit. 1 am told this will satisfy the auto dealers and others who have expressed concern over this matter. I am sure all members have received representations from the auto dealers' lobby across the country.
Then again, the question of the disclosure of consumer transactions is addressed positively in the legislation. This is another provision which I commend to hon. members. I agree that the federal regulations ought to be as strong as the provincial legislation in matters of banking or, in the case of the provinces, of near banks. Extensive federal-provincial consultations on this subject have been going on for some time. There has been a good dialogue, and I do not want to see progress of this kind destroyed by such hare-brained schemes as we heard tonight from the hon. member for Edmonton West. I do not think anybody in his party subscribes to his suggestion that we assert power federally to the point at which we place in jeopardy the whole of the near-banking operation which is now proceeding under provincial licence and jurisdiction.
The policy we prefer is one of consultation rather than railroading. This does not mean acquiescence. The former prime minister equated consultation with acquiescence. Consultation does admit to the possibility of disagreement, but it is consultation nevertheless. Had the right hon. gentleman learned the lesson that there was a difference between consultation and acquiescence we would not find ourselves in the mess which exists today in terms of the Loto Canada arrangements, for example.
We recognize that as this process of consultation with the provinces continues and brings about further resolution and benefits, there will be need for further modification in the regulations made under the Bank Act. That is why, in the wisdom of the draftsmen, certain latitude is left to the regulations. This has to be done in legislation of this sort which comes up for review after a fixed term. There is all the more need, then, for flexibility in making the regulations.
Mr. Speaker, I rose mainly because I felt the House was being misled, not deliberately, 1 admit, on a very important point, namely, the need for a definition. If one is going to address himself to an area as complex as that, he at least owes it to the House to give hon. members an inkling of the implications involved. I hope that in the course of this debate we shall hear from various members on that point.
I hope the opposition House leader will tell us why the administration of which he was a part rejected what appears to be a very logical suggestion from his colleague, the hon.
Bank Act
member for Edmonton West. 1 invite the hon. member for Nepean-Carleton (Mr. Baker) to rise in his place and give us the benefit of his knowledge on this subject.


Eugene Whelan: That won't take long.


Roger Simmons: Finally, 1 commend the provisions of this bill to hon. members. 1 hope we can put to bed very soon the entire subject of a definition of banking or, if not put to bed, at least keep it awake and alive in some sensible framework.


Marcel Joseph Aimé Lambert: Mr. Speaker, may I ask the hon. member a question?
1 am intrigued by the instant knowledge of the hon. parliamentary secretary of this legislation, but has he examined the testimony of almost all of the witnesses who were questioned on the point of the definition of banking, and has he studied their answers? I would say they were 99.9 per cent in agreement with me, and there were some definitions worked on, but I am prepared to work-


Mr. Deputy Speaker:: Order. The hon. member has asked his question. He has previously been recognized.


Roger Simmons: Mr. Speaker, first I will respond to the hon. member's preamble in which he lauded my instant knowledge. 1 thank him for that. Second, I will tell him that I do not have and do not profess to have very much expertise on banking or banking legislation. If we in this House get to the point where the only people who can rise on an issue are those who are recognized experts in their particular fields, we are going to have a pretty sterile debate.


Some hon. Members:: Hear, hear!


Roger Simmons: What I do bring to this debate-and I defend my right to do so-is the concern of ordinary Canadians 1 represent that the banking legislation we put through this chamber be the kind that can serve them best, and for that reason 1 make no apologies to the hon. member for Edmonton West for the kind of knowledge I have about banking.


Some hon. Members:: Hear, hear!


Roger Simmons: The hon. member asked me if I have examined the transcripts and the questions put to the witnesses, and their answers. He also asked me whether I am in agreement. No, he said it another way. He asked if I knew that some 90 per cent were in agreement with him. Here is my response to his question, in two parts: The first part of the answer is no, 1 have not read the transcript. I do not know what it says, and 1 probably would not understand it if 1 did read it. That is number one.
Number two, and more important, if the hon. member listened to me carefully he would not have heard me imply that I was even in disagreement with him on the need for a definition of banking. I do not quarrel with him on that subject. All I invite him to do is tell the whole story, and if he is going to advocate what sounds just like motherhood, namely, that there ought to be a definition, I agree with him that there

May I, 1980
Bank Act
ought to be, and nobody in this Elouse would disagree on that. There ought to be a definition. Of course there ought to be. All 1 have done is to invite him to tell the whole story.
If the hon. member advocates a definition, he should at least give some of the reasons why, for 110 years, we have not been able to get a definition. I also invite him to tell the House what the implications of putting that definition in the act would be.


Mark Willson Rose: Mr. Speaker, I have a question. Since the hon. member's time has elapsed, would the hon. member permit a question?


Roger Simmons: Sure.


Mark Willson Rose: I was very interested in the mea culpa of the hon. member who just spoke and in his loud defence of ignorance.


Mr. Deputy Speaker:: Would the hon. member ask his question, please.


Mark Willson Rose: The hon. member spoke in defence of the legislation now before us, and I agree with him that our party-


Some hon. Members:: Question.


Mark Willson Rose: The House is committed to the lay examination of any legislation before it.


Mr. Deputy Speaker:: The hon. member for Mississauga South (Mr. Blenkarn).


Mark Willson Rose: I wonder if I could repeat my question, please.


Mr. Deputy Speaker:: The hon. member for Mississauga South.


Roger Simmons: It was a good question, anyway.


An hon. Member:: What is the answer?


Mr. Don Blenkarn (Mississauga South):: Mr. Speaker, 1 have a number of remarks to make, but preliminary to what I would like to say in this session on this bill 1 remind hon. members that this bill has been before this House on a number of occasions. In the Thirtieth Parliament Bill C-15 was analysed in detail by a committee of this House. That committee held innumerable meetings and finally came up with a report in March of 1979. Ten members of that committee are no longer members of Parliament. There have been two federal elections since that time, and consequently there are a number of new people in this House, perhaps particularly from the New Democratic Party-although I do not speak on their behalf-who will want to question people and go over the evidence which was taken by the committee in the Thirtieth Parliament.
It is important in a matter of banking legislation that we do not forever hash and rehash, just because there is a change in the make-up of Parliament, evidence which was brought before committees. I think it is important when we consider this bill in committee that, before we even think of calling witnesses, every member of Parliament on the committee
review the testimony already heard by a committee of Parliament on a bill very similar to this one, Bill C-15, so that we do not waste the time of Parliament and of the people of Canada going over old straw.
Before I get to a number of things I want to say, I remind hon. members that the hon. member for Broadview-Green-wood (Mr. Rae) earlier today indicated an attitude on the part of the New Democratic Party which I thought was less than fair to this piece of legislation. He indicated that the banks have grown awfully rich. He said they doubled their profits between 1969 and 1979. Well, of course they have. We have had more than double inflation. The value of a dollar is considerably less today, less than half of what it was in 1969. Of course profits would have to be more than doubled, just to stay even. Members of the New Democratic Party know as well as anyone else that the profits of the major banks have in fact declined in the past year.


William Alexander (Bill) Blaikie: Not true.


Donald Alex Blenkarn: The hon. member for Broadview-Greenwood said this act should deal with interest rates. The hon. member knows full well that there is an Interest Act in our statutes. That Interest Act should be replaced. It should be amended. Many things should be done with respect to interest rates and the definition of interest, but certainly that is not a question which is properly in a bank act which is, as the hon. member for Edmonton West (Mr. Lambert) said, a charter for banks. That is another issue the New Democratic Party has been trying to flail before this House as an indication that it should stand in objection to a statute which, depending on the ability of our financial institutions to build the stability of our country, needs to be passed.
Finally, and even more important, the New Democratic Party came up with the proposition that because one of the chartered banks, in the opinion of a labour board, was unfair to its employees, this legislation should be blocked as a form of secondary boycott, as so often happens in labour relations matters, to hold up the business of Parliament, to hold up the financial arrangements of this country, and to damage the interests of depositors and of everyone. The secondary boycott concept is the kind of proposition that I was embarrassed to hear coming from the hon. member for Broadview-Greenwood, for whom normally I have a high respect. May I call it ten o'clock, Mr. Speaker?



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
A motion to adjourn the House under Standing Order 40 deemed to have been moved.
May 1, 1980

Hon. Elmer M. MacKay (Central Nova):: Mr. Speaker, I asked a question of the Minister of Fisheries and Oceans (Mr. LeBlanc) on April 28 concerning the ramifications of over-the-side sales of fish. I consider this to be a topic of sufficient interest and 1 would like to pursue it further this evening.
First of all I would like to say to the parliamentary secretary-I do not see the minister here tonight-that I would be the first to concede that not all over-the-side sales of fish products are bad, but it is very important, to use a phrase coined by my colleague, the hon. member for St. John's West (Mr. Crosbie), in the financial sense, not to sacrifice long-term gain for short-term pain.
I would like to explore with the minister or his representative the possible ramifications of what could happen if the concept of over-the-side sales of fish is not proceeded with very carefully. Not all over-the-side sales are bad. There are many situations where the quality of fish cannot be maintained unless frozen at sea. Examples of species which fall into this category are: mackerel, silver hake, and argentine. If we, as Canadians, wish to participate in these fisheries, we will have to freeze at sea, since local plants cannot process the fish or handle the volume that can be caught. In this situation, over-the-side sales are justified. However, if over-the-side sales are used as a price fixing mechanism, which could be the case, it could lead to a disruption in the Canadian fishing industry. Let me explain.
As I understand it, there are guarantees being paid to Joint Trawlers Limited for mackerel at 12.3 cents per pound or $270 per ton, which must be one of the highest prices paid anywhere in the world for this type of product. This could ensure that Canadian processors who wish to develop the finished product and get into the world market for mackerel cannot compete. Since there is a tremendous market in Germany for smoked and canned mackerel, the Canadian industry could get into this market if it could purchase mackerel at a realistic price, having regard to general world market conditions.
Under the present policy we may have difficulty in developing our own capacity to process mackerel. However, there is a catch 22 involved here as well because, as I understand it, the federal Department of Fisheries is attempting to develop an off-shore purse seine fishery for mackerel in the Gulf of St. Lawrence. They do not want the small boat fishermen to complain about the development of this fishery. It is possible that they do not want any large factory freezer-trawlers in the gulf as they feel the offshore fishery would lead to less fish coming inshore. This is just another consideration.
Over-the-side sales to factory freezer-trawlers is a demonstration of the need-and this is one of the main points of our Canadian fishing industry. We need these vessels to get into quality markets, and once we are into these markets we can bring into the world market some of our lesser quality fish. World markets in the processing industries are beginning to stabilize after the extension of jurisdiction, and unless Canada develops a capability to participate in the high quality markets, the opportunity is not going to exist forever and we may
Adjournment Debate
have great difficulties later, which is what I meant when I spoke about sacrificing short-term gain for long-term pain.
In summary, I believe that a couple of points should be made for the purpose of debate. As I said, we should not necessarily condemn the concept of over-the-side sales. They are only justified, I believe, when the off-shore capability is not available to handle the fish and quality cannot be maintained.
I believe that such sales as a price fixing mechanism or the commensurate benefit concept, as the minister referred to it in this chamber the other day, are not necessarily the best thing for the Canadian fishing industry, and providing guarantees to foreign fishing nations or joint venture firms such as Joint Trawlers Limited could be a form of a price fixing mechanism.
In 1980 it is serving a dual purpose, perhaps, of offsetting or anticipating the complaints of inshore fishermen about offshore catches of mackerel. If the worst comes to worst, and we do not neglect our opportunities, we can add to our Canadian fishing capability a few modern freezer trawlers. It is a fallacy to suggest that these vessels have to strain our total allowable catches or that they could not fish, if needs be, because they have the capability, far away from Canadian shores. There are other areas in the world that they can fish if they find difficulty in catching enough fish in our own quota waters. If we do not do this, the capacity Canada has to exploit the fishing markets of the world is not going to be realized.
I would like to continue these remarks with the minister on another occasion because 1 am sure he is aware, and he has the reputation of being aware, that there has to be a balance between the needs and opportunities of both inshore and offshore fisheries. In my own province of Nova Scotia, as I have already told the minister, there is a very great need to look at the licensing, and other considerations, that are presently existent, and to get young, capable fishermen into an area where they can not only earn a living but can do this country a great deal of good in catching and utilizing a very valuable product that is now going to foreign fleets.
It is for this reason that I open this subject tonight and invite the Minister of Fisheries and Oceans, or his capable parliamentary secretary, to let us have the benefit of the justification for some of these policies that involve over-the-side sales of fish.


Mr. George Henderson (Parliamentary Secretary to Minister of Fisheries and Oceans):: Mr. Speaker, regarding the direct sales arrangement in the maritimes, Joint Trawlers will provide five freezer vessels to purchase approximately 3,500 metric tons of gaspereau at a price to fishermen of seven cents per pound, and approximately 9,000 metric tons of mackerel at 12.3 cents per pound. This is an over-all increase in price of 11 per cent in the 1980 contract with Joint Trawlers compared to a similar contract in 1979.
Under the agreement with Joint Trawlers, the foreign vessels will be from countries which have a bilateral fisheries agreement with Canada. The vessels will be stationed at

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Adjournment Debate
various times in a number of maritime ports during the next four months to purchase gaspereau and mackerel.
In return for the commitments given by Joint Trawlers, to supply five freezer vessels for a number of months and purchase the fish at a predetermined price, the Department of Fisheries and Oceans has agreed, as an extension of its commensurate benefits policy, that Joint Trawlers will receive a direct allocation this year of 6,200 metric tons of species which have not been traditionally fished offshore by Canadians, including grenadier and Greenland halibut in the Davis Strait in Canadian waters, mackerel or silver hake, and a small amount of squid. No contract has yet been signed with Joint Trawlers and exact quantities of each species are still being discussed. The harvesting of this direct allocation will generate revenues of approximately $125,000 to the Government of Canada as the foreign vessels will be subject to all foreign access and fishing fees in accordance with Canadian regulations.
We cannot be absolutely certain where the fish that are the subject of this arrangement will end up being marketed but, as the offshore allocation and the inshore program are mostly composed of mackerel, it will likely be sold in east European and West African countries.
In 1979 revenue to fishermen from over-the-side sales accounted for less than 1 per cent of the total value of fish landed on the Atlantic coast. Departmental officials met at the request of the minister with processors and fishermen in the maritimes earlier this year. The processors were not prepared to make firm commitments on prices and quantities of gaspereau and mackerel. On the other hand, the offer from Joint Trawlers is for at least 9,000 metric tons of mackerel, at a price of 12.3 cents per pound. I ask hon. members to compare the alternatives. The facts speak for themselves. There are many areas in the maritime provinces-


Mr. Deputy Speaker:: Order, please. The hon. member for Mississauga South (Mr. Blenkarn).


IMMIGRATION-TIMOTHY LEARY-ENTRY INTO CANADA- HOTEL ENGAGEMENTS
Donald Alex Blenkarn: Mr. Speaker, April 21, I had occasion to ask certain questions of the Minister of Employment and Immigration (Mr. Axworthy) about one Timothy Leary. Mr. Leary is a citizen of the United States and was convicted of certain offences, which make him an unacceptable person to Canada unless he obtained, prior to coming to this country, permission from the minister through a minister's permit by order in council.
Apparently, Mr. Leary, through his agents and lawyer, applied for permission to come to Canada. He had previously applied on other occasions and had been turned down by previous ministers. Mr. Leary apparently applied, according to the minister's statement in reply to a question by me in this
House, on April 23rd, because he wanted to come to Canada to perform in Ottawa, Toronto and Montreal.
Strangely enough, Mr. Leary turned up in Winnipeg as his first port of call. The minister, unfortunately for him, is a limited partner in a hotel in Winnipeg which is managed by his brother, and the minister is responsible to the people of Canada in exercising his quasi judicial ministerial responsibility. I asked the minister a number of questions, and I was not satisfied with his answers. In one of his answeres the minister said that his officials had prepared the material. This left me with the impression, and I am sure the House as well, that instead of making the decision himself as to who should come into the country, he had left the matter in the hands of his officials.
In so doing the minister abrogated his ministerial responsibility by delegating his authority. Probably this is what happened, because I am sure that the minister, knowing him as I do, would not have deliberately exercised his authority to deliberately cause Mr. Leary to come to Canada to look after his brother's hotel. The problem, however, is the minister's, and according to the act he is responsible and not allowed to delegate his authority. Therefore he must stand responsible for what in fact has happened.
What happened was that a ministerial responsibility was exercised and clearly, a concrete explanation is necessary. It may well be properly explained in that the minister may have been deceived by his officials. If that is the case, then the minister should have no particular reason not to file the application which was originally presented in order to have Mr. Leary considered this time around for entry into Canada. Neither should the minister have any concern in tabling in the House, because this is a serious matter, the details of the application.
However, when the minister was asked in this House to table these documents on April 21, the minister refused or did not offer to file the material. On April 22 a question of privilege was raised by the minister, and there was a reference to the Standing Committee on Privileges and Elections. However, that reference is not clear as to whether it refers to the Leary matter or another matter which the minister himself brought to the attention of the House with regard to certain grants paid to the same hotel with respect to employment of handicapped people. I admire the efforts that have been made in existing statutes to encourage the employment of handicapped people and of all unemployed people.
One of the concerns of this House must be the detail and specific requirements of section 16 of the Senate and House of Commons Act. It may be that when the legislation was drawn in 1878 the section was appropriate, but it is totally inappropriate in today's situation where all sorts of statutes of Canada provide for payment to individuals of Canada or corporations of Canada, of money from Canada. Members have been known to collect the old age pension; their wives have been known to collect baby bonuses, and members have been known
May 1, 1980

to receive money for the shipment of their grain, their oil, their milk and so on. There are a number of statutes including those relating to manpower and taxes, that were never contemplated in 1878 when this section was introduced into legislation. It may well be that we need a clear definition of this in committee, and that is something to which we can look forward.
1 should like to have an assurance from the minister or his representative tonight that, in addition to the matter he raised concerning handicapped people or the use of a manpower grant by the hotel in Winnipeg, he will provide details on the Leary case to the committee, and that it will be one of the principal matters before the Standing Committee on Privileges and Elections. It is a question that brings up the whole problem of ministers and ministerial responsibility. I must say that I suspect the minister did not go out of his way-and I do not wish him any ill will at all-to do certain things with respect to administering his portfolio. Perhaps the burden placed on ministers under the terms of the Immigration Act is too great. The fact remains that there is a responsibility and the minister is seized with it. I think it is essential that the matter come before the Standing Committee on Privileges and Elections.


George Roland Henderson: Mr. Speaker, I have looked at the responses already given by the minister to this question, and have only the following comments to add.
I wish to remind hon. members that it is the policy of this government to recognize freedom of expression in Canada and the free circulation of ideas.
With the realization of the good sense and maturity of the Canadian population, our government believes there is no need to inhibit the free circulation of ideas. Consequently it has been our policy to facilitate entry of those who otherwise would be inadmissible under immigration law, but who have been invited by Canadians to speak or perform, provided we are certain their presence in Canada will not endanger the health, safety and good order of Canadian society.
Mr. Timothy Leary has in the past been refused entry as a visitor to Canada to guard against his advocating to students the use of LSD and other drugs. This time the Minister of Employment and Immigration (Mr. Axworthy) concurred with his officials to allow Mr. Leary time for the specific purpose of presenting a comedy night club act.
The hon. members may note that when the minister's decision was taken on March 6, 1980, Mr. Leary intended to present his comedy act only in Toronto, Ottawa and Montreal. It was only after his engagement in Ottawa was cancelled that immigration officials gave him permission to perform also in Winnipeg. The minister, may I add, was not informed of this change.
Adjournment Debate


NATIONAL DEFENCE-DEFENCE PROCUREMENT CONTRACTS- ALLEGED DISCRIMINATION IN AWARDING
Raymond John Skelly: Mr. Speaker, my concern tonight relates to a question I addressed to the Minister of National Defence (Mr. Lamontagne) and to which I received what I considered to be a totally inadequate answer. The basic question dealt with the allocation of industrial benefits that were generated by government procurement, specifically procurement of defence equipment, and the impact that this procurement would have on national unity.
Specifically, I mentioned the F-18 project in which industrial benefits according to the latest figures we have-and we do not believe those to be the latest figures-show that 47 per cent of those benefits accrue to the province of Quebec, 41 per cent to the province of Ontario, and 12 per cent to the rest of Canada, for a total of 88 per cent of those benefits winding up in central Canada.
Our information is that further figures have shifted even more of those benefits into central Canada. I would point to one example of a G.E. components plant in the lower mainland of British Columbia which was moved. These remarks were generated particularly by the minister's comments last Friday on the frigate program. This is another indication that benefits would accrue in the province of Quebec without a fair share being considered for the Pacific coast, British Columbia, and Atlantic Canada. I would point out that it is extremely important in the interests of national unity that industrial benefits be generated in those areas, especially in natural areas such as shipbuilding and the allied trades.
Mention was made also of the truck acquisition program. The purchase of about 2,500 to 2,800 trucks at a cost of roughly $200 million was announced by a Liberal government member, and work for this program would also accrue in central Canada, particularly in the province of Quebec.
I would point to some other things that concern us seriously about the benefits generated by the Government of Canada and the effect on the rest of the country and national unity. For example, the automotive industry program has in the past seen great benefits accrue in central Canada. Prebuilding of the pipeline and the steel industries will see those benefits largely accrue there. We wonder how allocations will be made in the future to the fishing vessel acquisition program that will probably run around $90 million. That information is very difficult, if not impossible, to acquire.
There is an announcement on refitting the coast guard, in the amount of $250 million. Where will those programs come from? In particular, I would like to comment on the cutbacks concerning the Minister of National Defence, in his role as co-ordinator of search and rescue. In the SARCUP program, which will see only 11 of 14 helicopters provided with the modifications necessary to do the job, I would ask the minister if he would not mind commenting why the other three, one of which is on the Pacific coast and two on the Atlantic coast, are not included in the SARCUP program.
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It would appear to me that the government's program for procurement of equipment is being allocated on the basis of political patronage, particularly in the province of Quebec where big promises are made to people. Rather than help, I would suggest that they simply aggravate the issue of national unity; in other words, promises, then betrayals. Clearly we need an industrial strategy, particularly in the shipbuilding industry and allied trades. Government procurement must be used to enhance that strategy. This method in the long run will be far fairer and seem to benefit everybody in this country, including the province of Quebec.
I would appreciate a more detailed comment from the minister than the one I received today in the House.


Mrs. Ursula Appolloni (Parliamentary Secretary to Minister of National Defence):: Mr. Speaker, I am indeed touched by the deep interest in things military on the part of a member of the NDP. It is unfortunate he cannot share his interest with his Ontario colleagues.
The minister's answer in the House this afternoon was very clear and totally adequate. This government aims to share the benefits of its activity in all regions of our country. However, I must remind the hon. member that, without abdicating any extremely important defence responsibilities, contract negotiations are the responsibility of the Minister of Supply and Services (Mr. Blais), and industrial benefits are within the authority of the Minister of Industry, Trade and Commerce (Mr. Gray). The Minister of National Defence (Mr. Lamon-tagne) is, of course, deeply concerned with these matters in that it is he who ensures that military needs and specifications are met. Therefore the matters raised by the hon. member are the subject of close co-operation among all three departments.
However, especially at this moment in our history I believe the hon. member does himself, his party, and certainly his country no service in misinterpreting the remarks or the intentions of the minister which were made clear in the House today.
The Liberal government negotiated a good deal, indeed a great deal, for Canada, for all Canadians in the new fighter aircraft program. McDonnell Douglas is committed to place at least 60 per cent of the offsets in the aerospace and electronics sectors of Canadian industry. Some specific projects are planned for specific regions, but most benefits are not specifically apportioned by region. The contract includes incentives to promote the distribution of benefits to areas of high unemployment and underindustrialization. The result will be wide distribution of benefits favouring those companies and regions which most aggressively pursued specific contracts with McDonnell Douglas and subcontractors to McDonnell Douglas.
Canadian shipyards from the west to the east coast, including Quebec shipyards, are in a position to compete for the building contracts for the frigate program. Once a decision has been reached on finalists to enter a competitive contract definition, shipyards on both coasts and in Quebec will, no doubt, be negotiating production proposals with the prime contractors representing the industrial group finalists.


Mr. Deputy Speaker:: Order, please. The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 11 a.m.
Motion agreed to and the House adjourned at 10.26 p.m.

Friday, May 2, 1980