1981-06-01

ROUTINE PROCEEDINGS


Mr. Gordon Towers (Red Deer):: Madam Speaker, I rise on a matter of urgent and pressing necessity. For the election of 1979, 18 new members of Parliament were added to the House of Commons, increasing the total from 264 to 282. After this week's census has been completed the House will grow by another 30 members, if the provisions of the Representation Act, 1974, are left as they are now.
Since the chamber has reached the limit of its capacity, since the cost of 30 more members of Parliament will be extremely high, and because many in this chamber feel it is already difficult enough to participate fully in the Question Period and the procedures of the House, I ask leave to move, seconded by the hon. member for Nepean-Carleton (Mr. Baker):
That the provisions of the Representation Act, 1974, be referred to the Standing Committee on Privileges and Elections, and that the government assist the committee by preparing a background paper setting out possible alternatives to the endless and unnecessary expansion of the size of the House of Commons.


Some hon. Members:: Hear, hear!


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: 
THE CENSUS
Mr. Robert Wenman (Fraser Valley West):: Madam Speaker, in view of the fact that question No. 37 on the 1981 census form asks married women to reveal whether or not they have had children out of wedlock, and considering the fact that this information is readily available from provincial social service authorities, just as other information requested in the census
form can be drawn from sources such as income tax returns, I move, seconded by the hon. member for Crowfoot (Mr. Malone):
That the Minister of Supply and Services put down his little red gun, strike out question No. 37 and all offensive and repugnant questions on this census form, try to get his act together with the provinces and federal government departments, and immediately serve notice to all census takers that extra questions on the long form should be gathered on a non-compulsory basis.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


NORTH-SOUTH RELATIONS FAIR DISTRIBUTION OF WEALTH AMONG ALL NATIONS- MOTION UNDER S.O. 43
Mr.   Chas. L. Caccia@Davenport: Madam Speaker, I rise on a matter which may have the support of all parties in the House. It concerns the death of Dame Barbara Ward, who devoted her life to a fairer distribution of the world's resources between rich and poor nations. In view of the upcoming summit meeting in Ottawa where the North-South question might be pursued, and in view of the serious consequences that inaction will bring about for people in the developing regions of the world, I move, seconded by the hon. member for Vancouver South (Mr. Fraser):
That this House express its renewed commitment to the cause of a fair distribution of wealth among all nations of the world.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


SMALL BUSINESS
Mr. Bud Bradley (Haldimand-Norfolk):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent necessity. The Prime Minister (Mr. Trudeau) said that the present economic situation in Canada baffles him. He cannot understand why people keep borrowing money, with such high interest rates. Surely the Prime Minister could try to

June 1, 1981
5.0.	43
understand the problems of small business. With the high rate of inflation, high rents, wages and all other aspects of small business, it simply becomes a matter of survival. They must borrow, no matter what the rate is, in order to avoid bank-rukptcy a little longer, hoping that someone in government will come to their senses and help them. But either the government does not care-and I hope that is not the case-or it does not understand small business. Assuming the latter, I move, seconded by the hon. member for Cambridge (Mr. Speyer):
That this House direct the Prime Minister and the Minister of Finance to contact an organization such as the Canadian Federation of Independent Businessmen and meet with them in order to learn how it really is in small business in Canada today.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


CANADIAN BROADCASTING CORPORATION
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5.0.	43
Mr. Lome Nystrom (Yorkton-Melville):: Madam Speaker, I rise under the provisions of Standing Order 43. My motion is motivated by the increasing evidence of labour-management problems in the CBC, as underlined by the resignation last week of national reporter Garry Aldridge in protest over the strike-breaking tactics of CBC management. I move, seconded by the hon. member for Winnipeg North Centre (Mr. Knowles):
That this House request the Minister of Communications to reduce the salaries of senior CBC management to a level of that of its technicians, until such a time as these conflicts can be resolved.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE ECONOMY
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5.0.	43
Mr. Peter Lang (Kitchener):: Madam Speaker, I rise under the provisions of Standing Order 43. Despite the fact that inflation is the No. 1 problem in Canada today, the Premier of Alberta has adopted two pro-inflationary moves in the past week, the first being a cutback of oil supplies to the east and the second being his advocating loose money supply and
increased spending. I therefore move, seconded by the hon. member for London-Middlesex (Mr. Bloomfield):
That this House request the Premier of Alberta to reconsider his pro-inflationary policy and join the battle against inflation by stopping his cutback of oil to the east and by ceasing to advocate inflationary spending.


Some hon. Members:: Hear, hear!


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


POST OFFICE
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5.0.	43
Mr. John McDermid (Brampton-Georgetown):: Madam Speaker, I rise under the provisions of Standing Order 43. Once again threats of postal disruptions are being heard in Canada. At a time when the Post Office is being turned into a Crown corporation, which we are told may hopefully solve some of these problems, many small business people who rely on the postal system for their livelihood are justifiably concerned, as are millions of Canadians who are fed up with the constant labour problems connected with the Post Office. Since the labour contract expired last December and contract talks have been going on for months now, I move, seconded by the hon. member for Cambridge (Mr. Speyer):
That this House urge the President of the Treasury Board and the president of the Canadian Union of Postal Workers to settle their differences immediately, thus avoiding chaos in Canada and ensuring mail delivery to Canadians who pay for and deserve continuing service.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


VETERANS AFFAIRS
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5.0.	43
Mr. Dan McKenzie (Winnipeg-Assiniboine):: Madam
Speaker, I rise under the provisions of Standing Order 43. Whereas the Veterans Administration in the United States processes pension claims, both new and appealed, within 90 days, and in Canada this same process takes up to 46 months, as stated in the Auditor General's report, and whereas the chairman of the Pension Commission has admitted that he is being hamstrung by the present veterans legislation, I move,
June 1, 1981

seconded by the hon. member for Nepean-Carleton (Mr. Baker):
That the Acting Minister of Veterans Affairs introduce immediately amendments to the veterans legislation to remedy this despicable four-year time lag in Canada and that he appear before the Public Accounts Committee which is dealing with his department tomorrow.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


FISHERIES
Mr. Thomas Siddon (Richmond-South Delta):: Madam Speaker, I rise under the provisions of Standing Order 43. Given the fact that the Minister of Fisheries and Oceans (Mr. LeBlanc) has failed to acknowledge the serious economic problems faced by the west coast fishing industry due to declining stock levels, excess fleet capacity, and haphazard management practices, together with the compounding impact on fishermen of the Liberal government's high interest rate policies, and given the fact that the government on Friday last rejected my motion under the provisions of Standing Order 43 calling for a special House order to authorize the Standing Committee on Fisheries and Forestry to visit the west coast during the month of June to investigate these serious problems firsthand, I move, seconded by the hon. member for Esquimalt-Saanich (Mr. Munro):
That this House instruct the Minister of Fisheries and Oceans to make an immediate statement on motions outlining the steps he will take to alleviate the threat of bankruptcy and vessel seizure faced by hundreds of west coast Fishermen to prevent a collapse of the west coast fishing industry.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


SOCIAL SECURITY
Mr. Rod Murphy (Churchill):: Madam Speaker, I rise under the provisions of Standing Order 43. In view of the fact that a native woman in my riding has received the ultimate form letter denying her a spouse's allowance, which letter did not explain why she was turned down, it was not dated, no name or signature was attached, no telephone number and no return address was given for the government office, and it was obviously designed not to allow space for this information,
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although she was asked to reply to the letter by the beginning of April, I move, seconded by the hon. member for Beaches (Mr. Young):
That the government review all its form letters to ensure that in addition to containing all necessary documentation, such as names and return addresses, that the reason for the refusal of the request is given and, also, that the manner of appealing the decision is explained.


Madam Speaker:: Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


HAZARDOUS SUBSTANCES
Mr. Albert Cooper (Peace River):: Madam Speaker, whereas the government is now considering legislation to move marijuana control from the Narcotics Act to the Food and Drugs Act, and whereas recent research indicates marijuana does have a number of serious physical side effects, I move, seconded by the hon. member for Cariboo-Chilcotin (Mr. Greenaway):
That the Minister of State and Minister of Communications in upcoming meetings with the Council of Education Ministers encourage them to co-operate with the federal government in an educational program designed to show Canada's youth both the hazards of marijuana use and the purposes of the proposed legislation.


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. John C. Crosbie (St. John's West):: Madam Speaker, in the absence of any of the leading members of the government-as a matter of fact there are only 14 cabinet ministers here out of 32. Fourteen! That is how concerned they are about the events today. Fifteen! One just joined us. The Prime Minister is not here, the Minister of Finance is not here-


Some hon. Members:: Where's Joe?

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Oral Questions


Madam Speaker:: Order, please. The hon. member is to ask a question, not make a speech about who is present in the House.


John Carnell Crosbie: My question, Madam Speaker, in light of this indifference of the government, is directed to the Minister of Industry, Trade and Commerce. The director of the Economic Council of Canada, Dr. Slater, spoke before the House of Commons finance committee on Friday. He said that a mix of policies is the best way to fight inflation, and that no single policy can cure inflation. He then said that Governor Bouey has been left by the government to go it alone to fight inflation with monetary policy only. The government has no other anti-inflation policy in effect.
In view of this criticism by the official economic advisory Council to the government, of the government's lack of policy, does the government plan to resign? Does it plan to ask the Minister of Finance to resign to put in a minister who will bring in policies, or does the government plan to introduce some anti-inflationary policies to help the people of this country and to help Mr. Bouey in his anti-inflation campaign?


Hon. Herb Gray (Minister of Industry, Trade and Commerce):: Madam Speaker, I think that the hon. member's question, quoting the chairman of the Economic Council, confirms that we are doing exactly what the chairman said we should do, and that is to pursue a mix of policies of an appropriate nature. This, in fact, is the approach of the government. In the last budget the Minister of Finance pointed out how, as part of an effort to restrain the forces of inflation, we are following, for example, a policy of expenditure restraint. So I think that we are doing something quite consistent with the advice of the chairman of the Economic Council, and where there are further initiatives to be announced, my colleague, the Minister of Finance, will be very quick to announce them.


Some hon. Members:: Oh, oh!


John Carnell Crosbie: I am glad that the minister agrees with what Dr. Slater has been saying, because Dr. Slater said the fight against inflation being waged by the government is little more than a phony war.


Some hon. Members:: Oh, oh!


John Carnell Crosbie: That is what the director of the Economic Council of Canada thinks. That is the mix of policies that the government has, the phony war.


INDUSTRIAL STRATEGY
John Carnell Crosbie: Dr. Slater said some of the policies which would be helpful would be an energy agreement on prices and revenue sharing, but there is nothing like that yet; a fiscal arrangement with the provinces which is in line with the present situation; and an investment strategy and program for the country.
The minister is supposed to be the author of the great investment strategy. We have not seen it yet. The deficit has not been reduced, though it is stated to be a plan. Can the minister tell us when are we going to have action in any of those areas which might help the battle against inflation? When? Specifically, if he cannot answer with reference to the rest, when is the minister's mighty mountain of an industrial strategy going to come mouse-like forward from the minister?


Herbert Eser (Herb) Gray: Madam Speaker, through numerous announcements we have been making in the area of industrial policy, we are confirming that we are moving in the right directions for the Canadian economy when it comes to industrial policy.


Some hon. Members:: Oh, oh!


Herbert Eser (Herb) Gray: Also, my colleague, the Minister of Energy, Mines and Resources, is working very hard to get the right kind of energy agreement with the producing provinces, which is something that the government of my hon. friends opposite was totally incapable of doing in spite of being in bed with the governments of the producing provinces. After listening to my hon. friend's questions, I understand very well why the Leader of the Opposition could not even get up the courage to come in and hear those questions. They certainly are not worth being present for, Madam Speaker.


TIMING OF PROGRAMS
John Carnell Crosbie: Madam Speaker, I have a final supplementary question. This government is so interested in the affairs of Canada that 15 of 32 cabinet ministers show up in the House! There is no external affairs, no defence, no finance, no Prime Minister! You are the government! If you want to give us your portfolios, we will show up.
My final supplementary to the minister is this. The minister and his-


Some hon. Members:: Oh, oh!


John Carnell Crosbie: Madam Speaker, they do not like their neglect pointed out to the public.


Some hon. Members:: Oh, oh!


Madam Speaker:: Order, please. Order, please.


John Carnell Crosbie: Thank you, Madam Speaker. The minister has had 15 months to bring forward an industrial policy. The Minister of Energy, Mines and Resources has had 15 months to reach an agreement with the provinces and all he has done is put forward conditions that no one can accept, and it has stalemated our whole energy investment and recovery program. Will the minister tell us what the timetable is for achieving completion of these strategies and putting them into action so that the battle against inflation can start to be
June 1, 1981

successful? When are they going to have a sense of urgency? When are they going to act to help the Canadians who are suffering so badly today?


Herbert Eser (Herb) Gray: Madam Speaker, first of all I should point out that I understand the Prime Minister is taking part in a meeting of the Council of Maritime Premiers, and that the Secretary of State for External Affairs is accompanying the Governor General on an important mission to Scandinavia. I hope that this is not something that my hon. friend would see fit to oppose, or object to.


John Carnell Crosbie: He is having a sauna. Where is the Minister of Finance? He came on the plane last night.


Herbert Eser (Herb) Gray: I think the evidence is clear that we are working vigorously to achieve progress, and that we have achieved progress in the areas my hon. friend has mentioned. If he is serious about what he is saying, he would do more than he has to make sure that we get the necessary co-operation, in particular from the producing provinces, in the energy area.
With respect to the number of ministers at present in the House, I might say that those who are here are more than enough to deal with the vapid and empty questions of the opposition.


PROFITS OF OIL COMPANIES
Hon. Michael Wilson (Etobicoke Centre):: Madam Speaker, I have two supplementary questions to put to the Minister of Energy, Mines and Resources regarding the lack of an energy policy and the impact this is having on inflation and economic growth in the country.
Government policy in Canada has contributed to a surge in profits in the refining and retailing side of the energy business, causing Canadians to pay much more than is necessary for energy in this country. Let me quote an example. As a result of the deregulation of oil prices in the United States, Gulf Oil in the U.S. went from a profit of $247 million in the first quarter of 1980 to a loss of $186 million in the first quarter of 1981. That is in the downstream side of the business. At the same time Gulf Canada went from a $55 million profit to a $95 million profit this year. In light of this, what does the minister propose specifically to remedy the situation? How is he learning from what is going on in the United States, in the evolution of his energy policy for this country?


Hon. Marc Lalonde (Minister of Energy, Mines and Resources):: Madam Speaker, first of all my hon. colleague has forgotten to point out that he has at heart the welfare of consumers. He should have indicated in his question, since he likes to refer to the United States' experience, that at the present time the American consumer is paying about 50 cents per gallon more than the Canadian consumer. We in this country have tried to protect the Canadian consumer from the inflationary impact of the very high price of gasoline. In all honesty, my friend should have referred to that.
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He refers to some profit situation with regard to particular firms. I would suggest to my hon. friend that his party should get their energy act together because, for the last six months, what we have heard from the other side has been that a National Energy Program was going to destroy the oil industry in this country.


Some hon. Members:: It is.


Marc Lalonde: They say it is, and at the same time their official spokesman accuses us of letting corporations make high profits. Make up your minds, fellows.


POSSIBLE CHANGE IN TAXATION
Michael Holcombe Wilson: Madam Speaker, the minister quite rightly points out what has happened in the United States. Let me quote the consumer price index figures which show that in July, 1980, Canada had a lower consumer price index growth, 10.1 per cent, against 13.1 per cent relative to the United States. This year the whole thing has turned around. We are now 2.6 percentage points higher, for a deterioration in the inflation performance in Canada relative to the United States of 5.6 per cent in less than a year. That is what is happening in this country, and the minister should listen to that.
Let me be quite specific in my supplementary question. Part of the Gulf Canada increased profits results from the paper profits that the minister referred to in this House a couple of months ago. These are caused by the minister through the imposition of his petroleum compensation charge, the Canadian ownership charge, and the Lalonde levy which result in real price increases to the consumer.


Madam Speaker:: Order, please. That question is a bit long. I would ask the hon. member to try to shorten it.


Michael Holcombe Wilson: I was just coming to the question, Madam Speaker. The point is that what the consumer loses, the government gains by income tax increases. Since I indicated, in a letter dated April 17 to the minister, that the problem could be remedied easily by a minor change in the method of imposing that tax, what action is the minister taking as a result of my letter to save Canadians in excess of $170 million in taxes which go to his government?


Marc Lalonde: Madam Speaker, as far as the point raised by the hon. member with regard to inflation rates is concerned, because we were able to keep energy prices at a lower level last year, in particular, we have been able to maintain our inflation rate lower than that in the United States.


An hon. Member:: That is wrong.


Michael Holcombe Wilson: Last year.

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Oral Questions


Marc Lalonde: Last year; last July. That is what I said. As far as this year is concerned, if I were to listen to the official opposition, we would have even higher inflation rates-


Some hon. Members:: No.


Marc Lalonde: -because what these gentlemen and ladies in the Conservative party are recommending is higher prices to the consumer than are in evidence at the present time. This is what we, on this side, have been fighting against. We have been trying to get an arrangement so as to continue protecting the Canadian consumer while providing adequate returns to the industry.


Mr. Andre:: How do you justify the PetroCan tax?


Marc Lalonde: As far as the last point raised by the hon. member is concerned, I have had an opportunity to discuss this issue with him. He knows that the situation is not as simple as he wants to make it appear, and as a consequence I do not intend to make changes to the present policy.


STATUS OF WOMEN
Miss Pauline Jewett (New Westminster-Coquitlam):: Madam Speaker, moving on to the Minister of Employment and Immigration, who is also the minister responsible for the status of women, can he now confirm that he fully supports mandatory affirmative action employment programs for women and other disadvantaged groups, including contract compliance? When will the minister recommend to cabinet the immediate implementation of them?


Hon. Lloyd Axworthy (Minister of Employment and Immigration):: Madam Speaker, I have indicated all along that we are prepared to take a wide variety of measures to improve substantially the equality of women in the work place. We have introduced a number of them during the past year, including new training programs, an affirmative action program in the public service, as well as the opening of new counselling centres. I have indicated that we are hoping to present in Parliament, in a matter of two or three weeks, a wide variety of recommendations and proposals dealing with changes in the labour and employment market in Canada, which will include a number of measures which will substantially benefit the working women in this country. I would ask the hon. member to restrain her impatience and see those recommendations in total so that we can have an entire strategy instead of just one or two measures.


Miss MacDonald:: You always say that to women.


VOLUNTARY VERSUS MANDATORY PROGRAMS
Pauline Jewett: Madam Speaker, that is a most disappointing answer, particularly in light of the letter I received from the minister on Friday which said that he would be approaching cabinet soon with a proposal respecting mandatory affirmative action, which is what my question was all about, not these other vague programs.
A recent document prepared for cabinet by the minister has also just come to my attention which states that what the minister is calling for is not mandatory action but voluntary action, voluntary affirmative action and voluntary contract compliance in the private sector. A memorandum last year dated May 21, 1980, from the minister's own department stated:
-four years of experience with a voluntary federal contracts program produced no results.
Why is the minister reversing himself?


Lloyd Axworthy: Madam Speaker, the hon. member is becoming convoluted in the wealth of her own speculations. I simply suggest to her that the commitment of this government to improve substantially the place of women and the equality of women in the work place is one which is well recognized. We will continue that commitment. We will have a number of recommendations that she, her colleagues, and many other people in this country might, and I hope will, support.


MINISTER'S SUBMISSIONS TO CABINET
Pauline Jewett: The
minister has totally reversed himself from May of last year to just the other day, as this document which was leaked to us shows. Finally, I ask the minister whether he will reconsider the key to providing greater equality in the work place, which is mandatory affirmative action and mandatory contract compliance? Will he consider taking this diluted document, throwing it out, replacing it with the one he prepared only a year ago, and presenting that to cabinet?


Lloyd Axworthy: Madam Speaker, I want to caution the hon. member to place very little confidence in leaked documents that come by way of brown paper bags from moles they have inside some parts of the public service. The fact is that we are considering a wide variety of recommendations. As soon as they are completed, finalized and presented where all members of Parliament will see them, we can get into an honest debate.
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RESTRICTIVE TRADE PRACTICES
Mr. Chris Speyer (Cambridge):: My question is directed to the Minister of Justice. It arises out of an answer given by the Prime Minister last Friday when asked by the hon. member for York-Peel when the gag regulations were going to be rescinded. The Prime Minister at that time said:
There are still some cases before the courts now, some Canadian citizens and some Canadian corporations are still sought after by American law. We will protect them as long as is necessary,-
Can the minister specify what Canadian companies or individuals are involved in litigation in the United States? What are the projections for termination of that litigation and, consequently, when are these gag regulations going to be removed so that Canadians can understand the facts of this sordid mess?


Hon. Jean Chretien (Minister of Justice and Minister of State for Social Development):: Madam Speaker, I do not have anything to add to the answer given by the Prime Minister last week. The hon. member is asking for a very precise answer which I do not have at this moment. I do not know if I can make it public. The Prime Minister stated the government's policy on Friday. We have to protect Canadian interests with regard to actions carried out in Canada and not according to the laws of other nations. We must ensure that the laws which control Canadian industries and citizens are Canadian laws, not American.


REASONS FOR GOVERNMENT ACTION
Chris Speyer: Madam Speaker, I am surprised that the Minister of Justice does not know what litigation is in progess now because it is the underpinning upon which the Prime Minister says he is maintaining these gag regulations.
Why is the government protecting and sheltering Canadian companies potentially in violation of American price fixing laws? If the shoe were on the other foot and American companies were being protected by an American government, would this government not be complaining and screaming?


Joseph Jacques Jean Chrétien: The hon. member is asking a hypothetical question. We would have to deal with the serious situation at that time to ensure that action in Canada regarding an international situation was done according to international law. There was nothing illegal about being a member of a cartel with other nations in order to protect a Canadian industry against uncalled for action by the American government that was affecting another nation. It is an international agreement. It was completely legal. When they wanted to force Canadian companies to appear in the United States because of actions that were carried out and permissible under Canadian law, we felt it was our duty to make sure that the Canadian citizens and industry in Canada were following
Oral Questions
Canadian law rather than be subject to the laws of the Americans.


FORESTRY
Mr. F. Oberle (Prince George-Peace River):: Madam Speaker, for the past two weeks I have been wanting to direct a question to the minister of forestry, but he is not in the House. I wonder whether the Minister of Industry, Trade and Commerce, who has a certain responsibility over some forestry matters, would answer a question. Has cabinet yet considered a document which was to come before it in June of last year entitled "Strengthening the Canadian Forest Sector"? Has that document yet come before cabinet? Is the federal government serious about asserting and reassuming its role in the Canadian forest sector, particularly in the area of forest renewal and forest protection? I ask this in light of the crisis being experienced by the forest economy at the present time.


Mr. Roger Simmons (Parliamentary Secretary to Minister of State for Science and Technology and Minister of the Environment):: Madam Speaker, I am not certain whether the hon. member wants to know if a particular set of recommendations have been made to cabinet on strengthening the forest industry. I can indicate that a number of studies were authorized last year, a total of six. We have received a report on two of these, I believe, one or two. The others are ongoing. Once all six reports are completed, we will then be in a position to formalize our thrust.


PROTECTION AGAINST FOREST FIRES
Frank Oberle: Madam Speaker, you can understand the frustration which people in the forest sector are experiencing. Twelve billion dollars a year more than any other industry in Canada is earned by the forest sector in terms of export dollars, yet the Minister of Industry, Trade and Commerce cannot answer in this House whether cabinet has addressed itself to this serious situation. Is the federal government prepared to assume a role in the area of forest protection? I ask this in light of the drought that will again be experienced this year with a shortage of moisture and shortage of snow throughout the country from Newfoundland to British Columbia. Is there a contingency plan by which the federal government could intervene through the armed forces, or any other way, to protect our forests?
Will the government once again realize the importance of our forest industry and act in a manner consistent with traditions in this country, namely, research and development, forest protection and forest renewal, so that the provinces can make their contribution in this important area?

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Oral Questions


Roger Simmons: Madam Speaker, the hon. member comes fairly late to the cause. We have agreements with a number of the provinces. Within the last month or so we signed an agreement with the Province of New Brunswick, and just before that with the government of Newfoundland. We have other agreements which are either pending or have been signed, addressing the various issues the hon. member has raised in terms of stimulating the forest economy, protection, and silviculture. We have programs and multimillion dollar agreements which address these issues. I welcome him to a cause we have recognized for some time and have been addressing for some time.


PRESENCE IN GALLERY OF HIS EXCELLENCY THE GOVERNOR OF SAO PAULO, MR. MALUF
Madam Speaker:: I would like to draw the attention of the members of the House to the presence in our gallery of His Excellency the Governor of Sao Paulo, Mr. Maluf.


PRESENCE IN GALLERY OF CHIEF OF THE NETHERLANDS DEFENCE STAFF, GENERAL C. DE JAGER
Madam Speaker:: I would also like to draw the attention of the House to the presence in our chamber of General C. de Jager, Chief of the Defence Staff, The Netherlands.


Some hon. Members:: Hear, hear!


INDIAN AFFAIRS
Mr. Stan J. Hovdebo (Prince Albert):: Madam Speaker, there are 13 employees of the Institute for Development of Indian Government in Prince Albert who have been abandoned by the Department of Indian Affairs. The institute was established by the Department of Indian Affairs and turned over to the National Indian Brotherhood some time ago. During the last month and a half both organizations have abandoned these people. Will the minister assure this House that his department will relieve the insecurity and psychological stress which these employees are feeling, by indicating what action he will be taking?
Hon John C. Munro (Minister of Indian Affairs and Northern Development): Madam Speaker, it is not correct to say that the National Indian Brotherhood has abandoned these people. They had some rather extensive talks with me regarding the plight of this enterprise. It is an independent federal company, not a government company. We have looked at the situation from a legal point of view. I have not yet got the legal opinion as to whether, even if I could get Treasury Board
approval, we could legally pay the salaries of these people who have been waiting for their wages. I have certainly sought a legal opinion, and as soon as I get it I will then assess the situation to see if we can offer some relief. That is the way the matter stands at the present time.


SALARIES OF EMPLOYEES
Stanley J. Hovdebo: Madam Speaker, I believe the Department of Indian Affairs and Northern Development is ultimately responsible since it was the funding body. However, will the government take steps to get the National Indian Brotherhood, or the department itself, to take some action so that these people are not left in the position in which they do not know where their salaries are coming from, do not know what is happening to their superannuation, and do not even know whether their withheld tax has been forwarded to the Department of National Revenue?


Hon. John C. Munro (Minister of Indian Affairs and Northern Development):: Yes, Madam Speaker, we have endeavoured, as a result of representations from the hon. member last week, to make this situation quite clear. It is not a happy one, and the employees know it. We are now addressing ourselves to the question of whether there is some way they can be afforded relief in terms of arrears of their wages.


RESTRICTIVE TRADE PRACTICES
Hon. Walter Baker (Nepean-Carleton):: Madam Speaker, as a result of an answer by the Minister of Justice to a question raised by the hon. member for Cambridge, he indicated that in his opinion, or at least if he had an opinion, the operations of the cartel were completely legal in terms of Canadian law. That raises a couple of questions. If the operations are perfectly legal in terms of Canadian law, why was the report that was sent to the Justice Department not released immediately? If there is something wrong with the answer, why is this investigation being undertaken? Why is this excuse for an investigation within the department being given, and why is that report not available now so the people of Canada can see it and make their own judgment as to the propriety of this?


Joseph Jacques Jean Chrétien: Madam Speaker, there are two aspects to this problem. There is the question of having an agreement with other nations involving the matter of uranium, and I have said that according to international law that is completely legal. There is the other aspect of the possibility of a cartel within Canada in relation to the Canadian consumer. This is a different aspect of the problem. I was dealing with the former, the first one. They are two different things.
June 1, 1981


POSITION OF COMPANIES IN CANADA
Hon. Bill Jarvis (Perth):: Madam Speaker, I direct my question to the same minister because I do not think his answer clarified the matter. In fact I think he further confused it. Is the minister in receipt, either in the Bertrand report or from legal officers of his department, of an opinion that the action in fact was legal according to Canadian law? To avoid having to ask a supplementary question, may I ask whether it is the position of the chief law officer of the Crown that Canadian corporations, members of an international cartel which may have been in breach of another country's laws, namely, the laws of the United States, are of no concern to that chief law officer of Canada? That was very clearly the implication given in the second response to the hon. member for Cambridge.


Joseph Jacques Jean Chrétien: Madam Speaker, I replied earlier to a question about the international agreement. Canada as well as other countries, including Great Britain and France, decided to enter into an international agreement in order to set the price of uranium. The Canadian companies subject to this international agreement acted in accordance with international law and, in my opinion, in their dealings with other countries, they fully complied with Canadian law. As for the offences committed within Canada, these companies must abide by the anti-trust legislation of Canada. We have received a report from the director which we are now reviewing. If there are grounds for charges to be laid against companies or individuals, we shall act in accordance with Canadian legislation and the laws governing marketing within Canada, and there is a major distinction to be made in this regard.


QUERY RESPECTING LEGAL OPINION
William Herbert Jarvis: Madam Speaker, let me put it very directly to the Minister of Justice. He says their actions were legal, in his opinion. Is that opinion based on parts of the Bertrand report and, in addition, is that opinion based on an independent legal opinion, either within the department or outside, that the minister has received?
[ Translation]


Joseph Jacques Jean Chrétien: Madam Speaker, I have nothing to add to what I said earlier. I made a distinction between two aspects of the problem. I spoke about an international cartel set up by several countries which Canada decided to join. Under international law, we are entitled to take such action.
As for activities within Canada, this is a different problem. We have received a report from the director, Mr. Bertrand, and we are now reviewing it to determine whether charges
Oral Questions
should be laid. As soon as my officials have completed their review, we shall decide whether or not we should take action against individuals or corporations within Canada as a result of their activities on the Canadian market.


SHIPMENTS THROUGH PORT OF CHURCHILL-REQUEST FOR INDEPENDENT STUDY
Rodney Edward Murphy: Madam Speaker, I direct my question to the Minister of Transport. In view of the fact that the Canada Grains Council, which is controlled by the private grain trade and is subsidized by the Canadian taxpayer, has just released a report critical of the Port of Churchill, and since asking the Canada Grains Council to evaluate the Port of Churchill is similar to asking the minister responsible for the status of women to do a job evaluation of the position held by Doris Anderson-


An hon. Member:: That's a joke.


Rodney Edward Murphy: The minister is a joke, yes. Is the Minister of Transport prepared to set up an independent commission to study the Port of Churchill?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, there have been, and there are still going to be, many studies of the Port of Churchill.


An hon. Member:: We can believe that.


Jean-Luc Pepin: Yes, indeed. I am quite sure the debate will go on even after the studies. The one which is referred to will obviously make a contribution. In the meantime the Canadian government does its very best to help in the maintenance and the development of Churchill by a diversity of means I do not want to spell out.
On the subject of grain, though, I might indicate that the Canadian Wheat Board has already sold 250,000 tonnes through Churchill this year, at a price, and if the crop improves the Canadian Wheat Board says it may be in a position to increase that basic amount.


Rodney Edward Murphy: Madam Speaker, the minister knows not of what he speaks. The 250,000 tonnes is a minimum amount. It is what we had last year. If we do not get some action by this government the port is going to close. Is the minister forcing the CPR to come to an interchange agreement in order to make sure that grain which is on CP lines can go through the Port of Churchill?


Jean-Luc Pepin: This is being discussed at the moment, Madam Speaker.
Oral Questions PUBLIC SERVICE

June 1, 1981


COMPULSORY RETIREMENT AT AGE 65-GOVERNMENT POSITION
Mr. Maurice Foster (Algoma):: Madam Speaker, I direct my question to the President of the Treasury Board.
In view of the provisions in the charter of rights prohibiting discrimination on the basis of age, and the interest of some civil servants in continuing to work beyond the age of 65, is the minister planning to remove the compulsory retirement rule for civil servants at age 65?


Hon. Donald J. Johnston (President of the Treasury Board):: I thank the hon. member for the question, Madam Speaker. This is a subject we are examining at Treasury Board. As many hon. members may know, we have already encouraged deputy ministers to examine individual cases on a case-by-case basis to determine whether prolonging of employment beyond 65 is justified. I think it will become a subject of ever-increasing discussion, particularly with the adoption of the charter of rights, and I will assure hon. members right now that we will give serious consideration to bringing forward proposals as soon as our own examinations of the subject are completed.


WESTERN DEVELOPMENT FUND
Hon. John A. Fraser (Vancouver South):: Madam Speaker, my question is directed to the Minister of Employment and Immigration.
As long ago as December the Minister of State for Trade seems to have indicated that federal government financing for the Advanced Light Rapid Transit system in Vancouver would come from the Western Development Fund. On April 24 the hon. Senator Perrault announced that the funds would not come from the Western Development Fund. On Thursday, May 28, the Minister of Employment and Immigration stated in the House that the funds for the Light Rapid Transit system would come from the Western Development Fund. On Friday, May 29,1 was advised by the government of British Columbia that Senator Perrault had stated that federal funds for ALRT would not come from the Western Development Fund.
Will the minister tell us whether the funds are coming from the Western Development Fund, can he confirm that there is a Western Development Fund, and if there is not a Western Development Fund will the minister confirm to this House what the Hon. Ray Perrault said last week, that no matter whether there is or is not a Western Development Fund there will be $60 million for Light Rapid Transit in Vancouver and that it will not be tied to the Western Development Fund?


Lloyd Axworthy: Madam Speaker, what is really important in the hon. member's question is the last part. The fact is that there are
funds committed by this government to help the city of Vancouver and the province of British Columbia, not only to finance the LRT system but to begin developing a basis for much broader industrial activity relating to a very high technology enterprise. That is what is critical. This federal government does have a strategy for western development to help diversify its economic base and to provide for a brand new age of economic enterprises in western Canada.


ADMINISTRATION OF FUND
John Allen Fraser: Madam Speaker, what is important for this House is to find out whether there is a western development fund. This is a serious question and I ask the minister will he confirm that the funds available for light rapid transit are going to be available no matter what may happen to the western development fund? And will the minister tell us to which department that fund is allocated, and who is administering it, because the minister certainly is not?


Madam Speaker:: I am not sure that the minister should answer that question. I am not sure whether it has been addressed to the proper minister. It seems to me that this responsibility for the west is not one to which ministers in the House can respond. Probably the question could be posed to the Minister of Transport. .


John Allen Fraser: Madam Speaker, I accept your invitation but I would point out that the Minister of Employment and Immigration is in charge of a 13-minister committee on western development and he has been the spokesman for the fund.
Can the Minister of Transport confirm to this House that the Hon. Ray Perrault, speaking Thursday and Friday of last week to confirm that light rapid transit funding would be available whether the western development fund disappeared or not, was speaking for the government? And my second question is: where is the western development fund?


Jean-Luc Pepin: Madam Speaker, I am sure Senator Perrault would not have expressed that view unless he had solid grounds for doing so.


SMALL BUSINESS
Mr. W. C. Scott (Victoria-Haliburton):: Madam Speaker, my question is for the Minister of State for Small Businesses and Tourism. Can he explain why there has been so little promotion of the small business development bond availability to the small business community, something that could be very beneficial at this time of high interest rates and other difficulties plaguing the small businessman?
June 1, 1981


Hon. Charles Lapointe (Minister of State (Small Businesses and Tourism)):: Madam Speaker, I am glad the hon. member asked this question, because it provides me with the opportunity to promote once again the small business development bond program. The hon. member is certainly aware that the Minister of State for Small Businesses two weeks ago published a booklet outlining the small business development bond program. Copies of this booklet will be made available to all hon. members this week, as well as to chambers of commerce throughout Canada. I have personally issued three press releases on this matter, and the Minister of Finance two. We have also asked The Canadian Bankers' Association to promote this program. 1 feel, Madam Speaker, that we are taking every possible step to ensure that businessmen and businesswomen in Canada benefit from this program to the utmost.


INFORMATION REQUIRED
William C. Scott: I want to draw to the minister's attention that there are many lending institutions throughout Canada whose branches say they know nothing about the small business development bond when an individual goes in to make an application. As the minister knows, this bond, according to the government's legislation, will expire at the end of this year, and I hope that does not happen. However, as time is going by, what measures does the minister propose to take to make sure that every chartered bank branch has the available information and co-operation for someone applying for this assistance?


Charles Lapointe: Madam Speaker, I am grateful once again to the hon. member for raising this issue, because 1 am personally aware of several banking institutions, especially remote from larger cities and towns, which are not very aggressive when it comes to promoting the small business development bond program. The hon. member will doubtless be happy to know-as an indication of the demand for this program-that the Royal Bank of Canada announced last Friday that it was increasing by $275 million to half a billion the funds it is making available under this program.
Also, 1 will gladly raise this issue with the representatives of The Canadian Bankers' Association and ask them to keep on urging their local managers to make their customers aware of this program.
Oral Questions


FINANCE
Mr. John Gamble (York North):: Madam Speaker, in the absence of the Minister of Finance my question is directed to the Minister of State for Finance.
When I arrived home last weekend I had waiting for me a copy of a telegram which had been sent to the Prime Minister and the Minister of Finance by Mr. F. Peter Langer, the president of the Toronto Home Builders' Association. The telegram dealt with the pressing nature of crushing interest rate increases on not only the industry for which he spoke, but on the individuals desiring to acquire the products that that industry produces. In the body of the text, however, there appears some rather cogent and prudent advice to a government designed to reduce inflation and-


An hon. Member:: Question.


John Albert Gamble: -the pressure on interest rates, and these recommendations are made by Mr. Langer:
A substantial reduction in government spending and tighter control of the supply of money-
Is the minister aware of the telegram apparently received by the Minister of Finance and, if he is, does he agree with the general observation made therein in connection with the way in which inflation can be retarded and, if so, is he prepared to make recommendations to cabinet to follow the rather sage advice that Mr. Langer has to offer?


Hon. Pierre Bussieres (Minister of State (Finance)):: Madam Speaker, I am not aware of that telegram, but the hon. member summed up its contents for us fairly well. We have opted for, on the one hand, a more restrictive policy, as the hon. member already knows that the monetary policy of Canada aims at restricting the money supply. On the other hand, the Minister of Finance has indicated clearly how he was keeping government spending in line with the general trend in the increase rate of the national product while reducing the deficit over the medium and long term. The hon. member might wish for more stringent measures that would go to the other extreme and be far more painful for the Canadian economy, and that would, above all, go against all the representations his colleagues have been making for a while now asking special programs for home building, special programs for farmers, special programs for small businesses. I doubt that he would get the support of the members of his party in advocating even more stringent restraints.


GOVERNMENT POLICY ON EXPENDITURES
John Albert Gamble: Let the minister rest assured that I will put my own words in my own mouth. I have not asked for those programs. What astounds me is that these

June 1, 1981
Oral Questions
same recommendations are apparently shared by the general population in Canada.
If the minister is not aware of the telegram, he will be aware of the recent Gallup poll taken with respect to this issue, and I ask him, having regard to that poll's results which show that 65 per cent of Canadians prefer to follow the Reagan policy of substantial reduction of government expenditures, is this the real intent of this government, and will it in fact substantially reduce its expenditures?


Pierre Bussières: Madam Speaker, I have already indicated the underlying principles of last October's budget. The hon. member seems to be drawing conclusions from polls or opinions that would surely not square with those of the majority of Canadians. I believe the majority of Canadians approve the program introduced by the Minister of Finance aimed at reducing government spending and the deficit. In so doing, we are supporting the monetary policy implemented by the Bank of Canada and hope to reduce inflationary expectations and the real rate of inflation.


CANADIAN NATIONAL RAILWAYS
Hon. Stanley Knowles (Winnipeg North Centre):: Madam Speaker, my question is directed to the Minister of Transport. In view of the fact that Dr. Robert Bandeen, the President of CNR, in writing to CN pensioners, is encouraging them to continue making representations to all bodies who have some responsibility in solving the complex issue of retirement income, I, on their behalf, put this question to the Minister of Transport. Will he suggest very strongly to Dr. Bandeen that the windfall profits being made by the pension funds which Canadian National Railways have really belong to the people whose funds they are? Will he suggest, therefore, that those windfall profits should be used not to pay off some other debt, but to increase the pensions of Canadian National retired employees?


Some hon. Members:: Hear, hear!


Jean-Luc Pepin: Madam Speaker, I do not want to accept any of the postulates that were presented, but the other day in committee on a similar question which was biased toward an increase on an annual basis-an adjustment better than what has already been made-of CN pensions, I accepted the idea that I should talk to Dr. Bandeen very soon on that subject and report to hon. members interested in the subject.


CONSIDERATION FOR ALL RAILWAY PENSIONERS
Stanley Howard Knowles: Madam Speaker, I have a supplementary question. May I ask the Minister of Transport if he will not only talk with Dr. Bandeen, but will he also have words with the high-priced president of CPR, Mr. Ian Sinclair, to the effect that pension increases for railway employees on both lines should not be ad hoc-maybe yes, maybe no-but should be guaranteed annually in accordance with the rise in the cost of living?


Jean-Luc Pepin: Madam Speaker, I was in my office on Saturday and I received similar representations from other bodies, from another Crown company on that occasion. Repeatedly the government has indicated that the problem of pension was much wider than the public service, CN, CBC or whatever. That is why the government has taken a global approach to it, and report has been made on that particular approach.


REPORTED INTENTION TO PURCHASE OIL COMPANY
A. Daniel McKenzie: Madam
Speaker, my supplementary question is directed to the Minister of Transport on the same subject. When he is speaking to Dr. Bandeen will he also ask him if the CNR pension fund will be used to purchase Gulf Oil? What guarantees will the pensioners have that they will obtain some of the benefits of this transaction? Will he report back to the House on whether Dr. Bandeen and the CNR pension fund will be purchasing Gulf Oil in the near future? It is very active on the Toronto exchange, which would indicate that something is up.


Jean-Luc Pepin: Madam Speaker, I was familiar with the rumour; 1 thought it had died in recent days. Be that as it may, the CN pension fund may very well have shares in oil companies at this time, but no reference has been made to me, anyway, in relation to the use of the CN pension fund for the purchase of an oil company.


POINT OF ORDER
Harvie Andre: Madam Speaker, I should like to bring to the attention of the Chair several votes in the Main Estimates, 1981-82 which I believe to be out of order and inappropriate for inclusion in the subsequent appropriations bill flowing from these estimates.
The general argument in regard to whether votes in the estimates are in order or out of order was made by myself as recently as March 24 of this year and by numerous members in the House going back to 1971. Arguments have been made repeatedly over the last decade that votes should deal only with the appropriation of funds and not seek to amend legislation. They have been the subject of several rulings by the Chair.
June 1, 1981

I do not think I am being presumptive in saying that the position of the Chair in respect to this dollar item issue, as it has been titled, is very, very clear. March 25, 1981, was the most recent time this subject came up in regard to Supplementary Estimates (C), 1980-81. At that time Madam Speaker quoted Mr. Speaker Jerome who on March 22, 1977, probably stated it as precisely as in any ruling of the Chair when he said:
-the government receives from Parliament the authority to act through the passage of legislation and receives the money to finance such authorized action through the passage by Parliament of an appropriation act. A supply item in my opinion ought not, therefore, to be used to obtain authority which is the proper subject of legislation-
So it is very clear. Therefore, in order to prove that votes should be struck down as being out of order, it is simply necessary to show that they go beyond appropriation funds and somehow seek authority from Parliament for the government to undertake action.
On the last occasion I brought this up, on March 24, the President of the Treasury Board (Mr. Johnston)-it may have been spontaneous-resorted to the argument that an appropriation act is legislation and, therefore, it is fine to use an appropriation act for legislative purposes. As I indicated, that argument has been made repeatedly over the last decade and struck down by the Speaker every time. I will not go over that ground again, but I put the caveat that if perchance the President of the Treasury Board should make those arguments in a way as to be persuasive and cause the Chair to reconsider these clearly established rulings thus far, I would ask the Chair's indulgence to participate in any such debate if it should arise.
I will not take the time of the House to go over the reasons for the Chair's rulings. I will operate under the assumption that the ruling is clear and precise, and I will bring the various votes to your attention as to their eligibility or whether or not they are in order.
First I refer the House to vote 30 in the Department of Agriculture, page 2-26 of the Main Estimates, 1981-82. This vote is tantamount to an amendment to the Animal Disease and Protection Act. In essence, vote 30 indicates that, notwithstanding the restrictions of the Animal Disease and Protection Act in respect of conditions which must be satisfied in order for compensation to be paid, payment is authorized, even when the conditions of the act are not met. In other words, vote 30 seeks to amend the Animal Disease and Protection Act. The vote comprises the following:
Contributions including compensation at rates determined in the manner provided by Section 12 of the Animal Disease and Protection Act to owners of animals affected with diseases under that act that have died or have been slaughtered in circumstances not covered by the act.
This vote would seek to extend the provisions of the act to situations not covered by the act. This is the precise language, it is clearly legislating. I would consider it to be out of order.
Next I refer the Chair to the Department of Energy, Mines and Resources, pages 7-12 and 7-14, votes 35, 40 and 45. In essence, each of these votes seeks parliamentary authority to establish new programs. Vote 35 deals with the Canadian
Point of Order-Mr. Andre
home insulation program. In the commencement of that vote, the exact language indicates that it provides for the following:
Contributions in respect of a home insulation program in the provinces of-
Then it goes on. It talks about "a", not "the". In other words, it is establishing a new home insulation program.
Later in the description of the vote, it asks for authority to be provided to the governor in council to make regulations in respect of this program. The vote is seeking authority, on behalf of the governor in council or on behalf of the government, to make regulations in respect of the home insulation program which the vote seeks to create.
Vote 40 is precisely the same in respect of the home insulation program or the so-called HIP which concerns provinces other than those included under CHIP.
Vote 45 on page 7-14 deals with the Canadian oil substitution program. It seeks authority to establish this program and it also seeks authority for the governor in council to make regulations in respect to that authority. Presumably, if these programs were in existence by some legislative authority the votes would have read "contributions for the Canadian home insulation program", "contributions for the home insulation program", or "contributions for the Canadian oil substitution program". The votes go much beyond that and give authority to the governor in council to make regulations, and so on and so forth. They do not talk about the CHIP program, the HIP program or the COSP program; they talk about "a" program. The language is very clear; the intent is for Parliament to give authority to the government to do that.
In any case, I have been unable to discover any other place where authority for these programs could be obtained. To my knowledge there has been no legislation establishing these programs, nor is there any existing legislation which would give the government authority to undertake these programs. I have not been able to discover that, but perhaps I could be enlightened to the contrary if that is the situation.
I next refer the Chair to votes L45, L50, L55 and L60 under the "External Affairs" estimates found at pages 9-30 and 9-32. Each of these votes seeks authority for the governor in council to issue certain debt instruments, namely, non-interest bearing, non-negotiable demand notes. For example, the Chair will note in vote L45 it is stated:
-to confirm and ratify the issue of non-interest bearing, non-negotiable demand notes to international financial institutions for international development assistance in previous years in an amount of $169,177,325.
In other words, this vote seeks to confirm and ratify the issuance of these debt instruments. The other votes, vote L50, L55 and L60, are, in fact, for one dollar. They are in the classical one dollar mode, if you will. A vote for a dollar is clearly not seeking funds but the authority to undertake certain action. Your Honour's predecessors, and perhaps Your Honour as well, have ruled that a dollar item may be appropriate in amending previous appropriations acts, that is, transferring money from one vote to another which may have been authorized in a previous appropriations act. But a dollar item

June 1, 1981
Point of Order-Mr. Andre
is not appropriate for granting legislative authority to the government. The dollar items here mention no such previous appropriations act. They are not an attempt to transfer funds from one vote to another; they are an attempt to grant the government authority to undertake certain actions.
The reason the authority is needed to undertake what is being undertaken arises from the Financial Administration Act. Section 80 of the Financial Administration Act states:
Except as provided in this act or any other act of the Parliament of Canada,
(a)	a Crown debt is not assignable and
(b)	no transaction purporting to be an assignment of a Crown debt is
effective so as to confer on any person any rights or remedies in respect to
such debt.
Section 79 of the Financial Administration Act defines "Crown debt" as any debt for which the Crown is or may become liable.
In each of these votes the authority is sought to issue a demand note, which is a Crown debt. It could confer on the Crown or impose an obligation on the Crown to make payment on that note when it is demanded by the holders of the note, which are various international agencies. The Financial Administration Act says that can be done only with legislative authority, authority from Parliament. Hence, these votes in the estimates for a dollar seek that authority. That authority is not permissible under the rulings made by Your Honour and Your Honour's predecessor. Therefore, I submit all of these votes are out of order and should be struck down.
1 refer the Chair next to the Department of Finance estimates on page 10-28, vote L15, which is precisely the same as the votes I mentioned previously. It is a dollar vote to authorize the minister to issue non-interest bearing, non-negotiable demand notes in such form as the minister may determine. In other words, all of the arguments I provided with respect to the votes under the Department of External Affairs estimates may be applied to the votes under the Department of Finance estimates. That is to say, the Financial Administration Act would prohibit the government from doing that without legislative authority. The government should not seek legislative authority through the appropriations bill to do that through a dollar item.
I next refer the Chair to page 23-64, Department of Public Works estimates, vote L70, which again is a dollar item. On examination of the vote it becomes clear that the intention of this vote is to amend legislation. It is merely for a dollar; therefore it does not seek funds. The purpose of the vote is to amend sections 34.14(2)(a) and (b) and section 40(5)(a) and (b) of the National Housing Act.
1 next refer the Chair to page 29-12, Department of Supply and Services estimates, vote 5. It is stated under vote 5:
-an amount not exceeding $3,020,000 in respect of the costs of free and subsidized publications shall not be taken into account in the calculation of the expenditures referred to in subsection 29(3) of the Adjustment of Accounts Act.
In other words, this vote clearly seeks to amend subsection 29(3) of the Adjustment of Accounts Act, which unamended would prohibit the government from undertaking this activity. I submit vote 5 is also out of order.
Finally, I refer Your Honour to vote 110, Department of Transport estimates, page 30-90. I would like to quote from line six of that vote:
-provide that subsection 6(2) of the Atlantic Region Freight Assistance Act shall not apply in the case of the payment of assistance in the current fiscal year to truckers pursuant to subsection 6(1) of that act.
This vote clearly seeks to amend the Atlantic Region Freight Assistance Act, something which is not permissible. According to the rulings of the Chair, votes cannot be used to amend legislation.
Those are the only votes I intend to seek a ruling on. I humbly submit that each of the votes I have mentioned is out of order, given the clarity of the Chair's decisions in respect of what can or cannot be included in an appropriations bill arising from the estimates. I have the suspicion, Madam Speaker, that there are a great number of other votes in the estimates which may also be out of order. To be frank, I lack the resources to do the research necessary to confirm one way or another whether this is so. I do not have the back-up staff which the President of the Treasury Board has to make that kind of assessment.
After ten years of raising this point of order I am astounded that this same question has come up repeatedly year after year. The Chair has not been ambiguous but, rather, very precise and proper in its rulings, yet year after year when the main or supplementary estimates are before us they contain items which are clearly out of order to any fair-minded person. Frankly, it is bordering on contempt of Parliament. In fact, the regularity of the Chair's decisions in respect of the order of propriety of these items are just dismissed. The Chair's rulings seem not to matter one whit when preparation is commenced in terms of the next set of estimates. They just carry on. If some get struck down, that is just too bad; they just put in a new set the next go around.
It is getting to the point where I am wondering whether we perhaps should not entertain a new procedure of handling this. Heretofore, the responsibility, if you will, has rested upon the opposition to examine these estimates and to make our position known to the Chair; the Chair has examined the arguments and ruled one way or another. I do not mean in any way, shape or form to be critical of the Chair. I think the Chair has been quite lenient toward the government in the past by saying that though it has been suspicious about certain items, it would leave them there for now, but in the future it would have to be shown that they are in order. That kind of warning seems not to have had any effect.
I am therefore going to offer the suggestion that we might look at another arrangement whereby members of Parliament can raise points of order in respect of votes, and they will be deemed out of order until such time as the government proves, to the satisfaction of the Chair, that they are in order, rather than the reverse. I agree that that opens the possibility for abuse; but we have had ten years of abuse of Parliament from the government by its total neglect and disregard of decisions
June 1, 1981

and rulings of the Chair in respect to what is appropriate for an appropriations act and what is appropriate for legislation.
I would ask the Chair to give this some consideration. It would be an awful lot easier for all of those people in the Bell tower to present argument justifying their actions than for some of us on this side to have to rely on our modest staffs to go through this horrendous document to find out whether, in fact, the votes are appropriate or merely a sneaky manner in which to try to obtain legislative authority for undertaking their actions.
Madam Speaker, I do not want to take up any more time of the House. I would ask Your Honour to give serious considerations to those votes and, perhaps, to the suggestion as to how we may handle this in the future, because ten years is enough time for anyone to learn, even the group opposite.


Donald James Johnston: Madam Speaker, in presenting his point of order, the hon. member makes much of the fact that this has been going on for ten years, with regularity, he suggests. I point out to him that, if anything, the objections have been ruled inapplicable with regularity, and in very few instances have there actually been deletions of items. In a moment, I would like to review with the House some of the instances in which such deletions have taken place.
The hon. member also very wisely, I might say, anticipated an argument which he is clearly incapable of answering; that is, the fact that what we have here is an appropriation act, an act of Parliament. He tends to reject that argument out of hand, and yet that has been the basis of many of the decisions by Speakers in the past. When this act is approved, it comes into force like any other act. While appropriation acts themselves are not subject to debate in this House, in accordance with the Standing Orders, they nevertheless cover the nonstatutory items contained in estimates which are scrutinized by the standing committees of the House.
In the case of main estimates, as we all know, the period of time for committees to review the spending plans and to call witnesses is three months. I suggest that those three months should provide ample time to discuss the items, particularly those items which may be of concern to hon. members, such as the $1 items to which the hon. member has made reference.
The second point I would like to make relates to the types of votes. My comments concern those types of votes which have been questioned by hon. members over time, and which have resulted in some items being disallowed by Your Honour's predecessors from time to time. In reviewing those items, I noted that the votes which were disallowed contained requests to amend provisions of other acts, particularly where those changes were of a continuing nature and would not appear in the Statutes of Canada. I agree that estimates should not normally be used to change the basic purpose or intent of existing legislation. However, it should be appreciated that these proposals are not always straightforward. In many cases, this is the reason for debate.
Point of Order-Mr. Andre
I believe we have made every effort to follow this general guideline, and I suggest that we have been successful in this respect. The items which were allowed by previous Speakers were financially related and provided for expenditures of money, which is the purpose of appropriation acts.
Turning to a third point concerning the $1 votes objected to by the hon. member during the review of supplementary estimates (C), they contain requests for deletion of debts, which Your Honour may recall you disallowed, for loan guarantees and for authority to invest in international development banks, which Your Honour allowed to stand.
With regard to loan guarantees which are included in appropriation acts, it should be noted that they are one time in nature, financially related; hence, on the basis of previous rulings, the estimates would appear to be the proper vehicle for obtaining parliamentary approval. In any case, if there is default, the resulting expenditure will appear in estimates and public accounts.
With respect to investments in the International Development Bank, there are four such votes in the 1981-82 Main Estimates. These votes would authorize the Minister of Finance (Mr. MacEachen) to sign notes for a one-year period within a total commitment made by the government. In most cases, the cash requirements of the notes signed in a specific year fall due over a number of years, with the results that the cash requirement in the same year from the authority requested for a specific note is less than the note to be signed. The cash requirement for this note and from previous notes signed are displayed in estimates as "statutory" so that the government's spending plan contains the cash outlays for the fiscal year in question. I would also like to point out that these items are specifically defined investments which make them truly financial in nature, and that they are similar to other nonbudgetary. loan and investment votes.
In conclusion, I would like to say that I appreciate the concerns of the hon. member; but I would reiterate that the items contained in the Main Estimates which he has attacked, are financially oriented. They do not change the essence of other acts and, in my view, they are proper items to be included in these estimates and the resulting Appropriation Act. The hon. member makes specific reference, for example, to certain votes of Energy, Mines and Resources, certain program votes. Of course, legislation will be introduced with respect to these programs.
In summary, where authority is given through an appropriation act, then it would seem entirely appropriate to amend that authority through another appropriation act. Where there is an amendment effectively to other statutes, then I suggest, provided it does not go to the intent or purpose of that statute but simply to the financial provisions or a change in financial provisions, then that would also be an appropriate way in which to effect that change; namely, through an appropriation act.
10116

June 1, 1981
Point of Order-Mr. Andre
Madam Speaker, I draw your attention for a moment to the disallowance of some items in supplementary estimates (c), in order to indicate the dilemma in which I find myself and to seek your guidance with respect to what steps you would consider appropriate.
You will recall, Madam Speaker, that eight items in supplementary estimates (c) cancelled debts and you ruled that they were pure legislative item seeking to amend section 18(1) of the Financial Administration Act. You ruled "that they should be and are hereby deleted from supplementary estimates (c) 1981-82". That was your ruling on March 25, 1981, Madam Speaker.
In the past we have always used these $1 items to delete such debts. Section 18(1) of the Financial Administration Act provides as follows:
The governor in council, on the recommendation of Treasury Board, may make regulations authorizing deletion from the accounts, in whole or in part, of any obligation or debt due to Her Majesty or any claim by Her Majesty that does not exceed five thousand dollars.
You can see, Madam Speaker, that it is not necessary to resort to legislation but simply to regulations to effect a deletion of debts up to $5,000. The question is, then, what procedures should the government adopt to delete debts which exceed that limit? I suggest, Madam Speaker, that this requires legislation and it occurred to us that the appropriate legislation would be an appropriation act. If not an appropriation act, Madam Speaker, I ask what kind of legislation would be appropriate? Perhaps an omnibus bill of some kind but it is clearly important that these come to the attention of members of the House and that is precisely why they are provided as one dollar items.
I would conclude, Madam Speaker, that the precedents we have followed in the preparation of the main estimates fully justify the items which have been attacked by the hon. member. 1 would hope that you would confirm that the main estimates have been properly prepared in accordance with precedent.


Madam Speaker:: Indeed, this matter is a complicated one on which the Chair has had to rule quite often and one about which the Chair has suggested that some way of handling this particular problem should be devised by hon. members. I have a feeling that when I rule on the point of order that has been brought up, I will end up suggesting that again. However, the matter being complicated as it is, I thank both hon. members
for their interventions and I will take the matter under advisement.



ROUTINE PROCEEDINGS


[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. D. M. Collenette (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, the following questions will be answered today: Nos. 1,722, 2,296, 2,303 and 2,320.


Mr. Stewart: 1.	For each of the past ten years, what percentage of the gross national product has been spent on research and development in Canada?
2.	What were the contributions in (a) dollars (b) percentages by the (i) government (ii) universities (iii) private sector?
3.	What Figures, expressed in percentages of the GNP, are available indicating the degree of gross expenditures of R&D in other western industrialized countries?
4.	What, if any, tax credits or incentives are available to the private sector for expenditures on RAD'
5.	What effect would an increase of (a) I per cent (b) 2 per cent of GNP in gross expenditures on R&D have on (i) jobs (ii) total new manufacturing sales (iii) total new jobs in R&D laboratories?
6.	What effect would each succeeding increase of 1 per cent of GNP in gross expenditures on R&D have on (a) jobs (b) total new manufacturing sales (c) total new jobs in R&D laboratories?


Roger Simmons: In so far as the Ministry of State for Science and Technology is concerned:
1. The data requested are as follows:
R&D Expenditures as a Percentage of GNP in Canada, 1970-79
Year	per cent	Year	per cent1970	1.24	1975	1.011971	1.24	1976	0.941972	1.13	1977	0.961973	1.03	1978	1.011974	1.01	1979	0.96
Source: Statistics Canada Economic Review 1980, Department of Finance.
2. The figures requested are as follows:

Order Paper Questions
Direct Funding of Canadian R&D Expenditures by Government, Universities, and Private Sector
Year	(i) Government	(ii) Universities (figures in $ millions)	(iii) Private	Sector1970	S 554.9	(52.2 per cent)	$141.3	(13.3 percent)	$345.3	(32.5 per cent)1971	593.2	(51.3)	153.4	(13.3)	383.3	(33.1)1972	625.4	(53.0)	145.7	(12.4)	378.7	(32.1)1973	679.2	(53.5)	146.4	(11.5)	409.1	(32.3)1974	743.3	(50.6)	183.2	(12.5)	507.7	(34.6)1975	785.0	(47.4)	235.1	(14.2)	591.9	(35.7)1976	847.3	(47.6)	260.8	(14.7)	624.6	(35.1)1977	945.4	(47.4)	284.9	(14.3)	708.9	(35.5)1978	1,074.2	(47.5)	305.1	(13.5)	821.0	(36.3)1979	1,137.9	(47.6)	333.5	(14.0)	851.2	(35.6)
Source: Statistics Canada
Notes: - 'Government' includes federal, provincial and provincial research organizations.
-	Private Sector includes business enterprises and private non-profit organizations.
-	Percentages in brackets give proportion of total R&D expenditures in each year. Funding contributions from foreign sources, both government and private, which generally amount to less than 3 per cent of annual totals, are not included.
3.	The major source for the data requested is the OECD. The latest figures readily available are as follows:
R&D Expenditures as a Percentage of GNP in Selected Industrialized Countries
Countries	1969	1971	1973 per cent	1975	1977Canada	1.2	1.2	1.0	1.0	1.0Belgium	1.1	1.3	1.3	1.2	1.2France	2.0	1.9	1.8	1.8	1.8*Germany	1.7	2.1	2.0	2.1	2.0Italy	0.8	0.9	0.9	0.9	0.9*Japan	1.4	1.6	1.7	1.7	1.7Netherlands	2.0	2.0	1.8	1.9	1.9*Sweden	1.3	1.5	1.6	1.8	1.9United Kingdom	2.3	2.1	-	2.1	-United States	2.8	2.6	2.5	2.4	2.4
*1976
Source: Directorate for Science, Technology and Industry, OECD.
Statistics Canada
4.	There are three forms of tax incentives available to the private sector for expenditures on R&D.
(i)	The 100 per cent write-off
Since 1961, firms have been able to write off against income 100 per cent of current and capital expenditures on R & D, less government grants and tax credits applicable to such expenditures. This is an incentive since all R&D expenditures are of a capital nature (i.e., designed to yield future income) and the normal treatment would be to capitalize such expenditures and depreciate them over the economic life of the assets acquired.
(ii)	The investment tax credit
Since March, 1977, current and capital R&D expenditures have been eligible for the investment tax credit. This now stands at 10 per cent except in the Gaspe and the Atlantic Provinces, where a 20 per cent rate applies, and 25 per cent for small business anywhere in Canada.
(iii)	The research allowance
Since April, 1978, firms undertaking R&D expenditures have been eligible to deduct from income 50 per cent of the amount by which the present year's current and capital R&D expenditures exceed the average of the past three years.
5.	Research and development as an activity is a complex process whose outcome is subject to varying degrees of uncertainty. R&D by its very nature is best viewed as an investment which has an expected pay-off mainly in the longer run and, for the individual company or industry, these pay-offs may not be realized for ten to fifteen years. Hence, the relationship between any given level of increase in R&D expenditures and its impact on the economy is both indirect and imprecise. Nevertheless, the results of various studies undertaken both in Canada and other industrial nations indicate that the contribution of R&D to economic growth and productivity is positive, significant and high.
Studies have shown that the returns from R&D investment have also been significant. At the industry or company level, some typical rates of return that have been calculated for specific industries are: chemicals, 30 to 50 per cent; petroleum, 40 per cent; and food, apparel and furniture, 15 per cent.
Moreover, those industries which purchase goods embodying innovations developed by others also benefit from R&D activities. This diffusion of technology serves to strengthen the economy generally by increasing the over-all level of productivity, thereby contributing to increased standards of living.
It is now generally recognized that the expanding industries of today tend to be those industries in which the rate of investment in R&D is relatively high. A recent MOSST study for example confirmed that, for the period 1961 to 1974, research-intensive industries significantly outperformed low-research-intensive industries by recording a higher rate of growth in output, employment and productivity and a lower rate of price increases.
6.	Same as reply to question 5 above.

June 1, 1981
Order Paper Questions EMBASSIES AND CONSULARS IN CANADA


Mr. Flis: 1.	What is the number of embassies and consular posts in Canada for the Soviet Union, Bulgaria, Roumania, Yugoslavia, Poland, Hungary, Czechoslovakia and East Germany?
2.	Were personal estates of deceased East Europeans residing in Canada confiscated by officials from these countries and, if so, in what number for the years (a) 1970 to 1975 (b) 1976 to 1980?


Hon. Mark MacGuigan (Secretary of State for External Affairs):: 1. Soviet Union:
Bulgaria:
Roumania:
Yugoslavia:
Poland:
Hungary:
Czechoslovakia:
German
Democratic
Republic:
1 Embassy, 1 Consulate-General (Montreal)
1 Embassy, 1 Consulate-General (Toronto)
1 Embassy, 1 Consulate-General (Montreal)
1 Embassy, 2 Consulates-General (Toronto, Vancouver)
1 Embassy, 2 Consulates-General (Toronto, Montreal)
1 Embassy, 2 Consulates-General (Toronto, Montreal)
1 Embassy, 1 Consulate-General (Montreal)
No Embassy or Consular post in Canada
2. Departmental files have revealed no conclusive evidence of the confiscation of personal estates of deceased East Europeans residing in Canada by officials of the above countries in the years in question. Estate transfer is a matter under provincial jurisdiction and the Department of External Affairs does not have detailed information on this subject.


Mr. Beatty: 1.	Were protests made by the United States government to the government over Canadian reception of American satellite television broadcasts and, if so (a) on what date (b) by whom (c) in what form?
2.	(a) What percentage of the (i) population (ii) geography of Canada can receive moderately clear signals from American satellites by TV R.O.s (b) what is the estimate of the number of (i) licensed (ii) unlicensed earth stations in operation in Canada?
3.	(a) What percentage of the (i) population (ii) geography of the United States can receive moderately clear signals from Canadian satellites by TV R.O.s (b) what is the estimate of the number of (i) licensed (ii) unlicensed earth stations in operation in the United States?
4.	(a) Does the government object to American reception of television signals from Canadian satellites (b) were protests made by the government to the United States government over American reception of Canadian satellite television broadcasts and, if so (i) on what date (ii) by whom (iii) in what form?


Mr. Peter Stollery (Parliamentary Secretary to Secretary of State and Minister of Communications):: In so far as the
Department of Communications is concerned, the reply to the above question is as follows: 1. No protests have been made.
2.	(a)(i) The strength of satellite signals is not uniform.
Satellite antennae are designed to provide a certain pattern on the ground, and the strength of the signal diminishes in moving from the centre of the pattern outward. The U.S. satellites generally cover all of southern Canada and reach the majority of the population, some 20 million people.
(ii) U.S. satellite coverage of Canada reaches the more southerly portions of the country with what might be called a reasonable signal, and can be received on a larger more expensive earth station at points farther north.
(b)(i) The number of licensed earth stations in Canada, of all kinds, was 604 at the end of March, 1981.
(ii) An estimate at that time of the number of unlicensed earth stations in Canada places the figure over 200.
3.	(a)(i) Canadian satellite coverage of the U.S.A.
reaches well over 100 million people there.
(ii) Anik A and B cover the majority of the U.S.A., although the more southerly portions receive much weaker signals.
(b) It It is understood that there are over 4000 TV ROs licensed to cable companies. As the U.S.A. does permit operations of a TV RO without a licence, the number of unlicensed earth stations is not known.
4.	(a) In 1972 there was an exchange of letters between
Canada and the U.S.A. whereby each country agreed that their respective domestic satellite systems would not be used to serve the other country apart from exceptional, specified circumstances. This agreement still stands although informal discussions have been held concerning the revision of this arrangement.
(b) No protests have been made by this government to the U.S., concerning the reception in the U.S.A. of the signals of the domestic satellites of Canada.


Mr. Herbert: Did the Department of the Secretary of State finance projects to provide a profile of the clientele to be reached by regional newspapers of Quebec and, if so (a) how many were financed in the past five years (b) for each project (i) what amount was granted (ii) to which regional newspapers were the profiles provided?


Peter A. Stollery: (a)	The Secretary of State financed two projects dealing with the clientele of regional newspapers in Quebec in the past five years.
(b)	(i) The first, entitled "English Community Newspapers in Rural Quebec" was completed in March,
June 1, 1981

1978, by the MacDonald Journal which received $4,805 in grant moneys under the Official Language Minority Groups' Directorate; the second, entitled "Survey of Readership of Anglophone Rural Press" was completed in the fall of 1979 by the English Community Newspapers Provisionary Committee which received $29,230 in grant moneys under the Student Community Services Program. (This project employed ten students during the summer months.)
(ii) The results of both studies were made available to all the regional newspapers, namely:
Name	Region Served
The Aylmer Reporter	Aylmer and district
The Equity	Shawville, and municipal county of Pontiac
The Gleaner	Chateauguay Valley (Valleyfield, Cornwall, Northern New York)
Hudson Gazette	Hudson and area
The Low Down to Hull and Back News	Low, Hull (Gatineau River Valley)
The Post	Buckingham, Gatineau, Thurso, Val des Monts
Quebec Chronicle Telegraph	Quebec City (Ste Foy, Sillery), also Shannon Val Cartier (Camp Val Cartier, CFB), Stoneham, Levis, Loretteville, Ste Anne de Beaupre, St Etienne de Lauzon
Rouyn-Noranda Press	Rouyn, Noranda
The Sherbrooke Record	Eastern Townships
Spec	Gaspe Peninsula
The Stanstead Journal	Stanstead. Rock Island, Sherbrooke, Lennoxville, Stanhope, Magog
The Townships Sun	Southern Quebec
The Val d'Or Star	Val d'Or
The Victory	St Eustache, Ste Therese, Deux-Montagnes, Rosemere
The Watchman	Lachute, Hawkesbury (S), St Emile-de-Suffolk (W), Lac Manitou-Sud (N), Ste Adele, Lafontaine, St Jerome (E)

[ Translation)


David Michael Collenette: Madam Speaker, if question No. 2,393 could be made an order for return, that return would be tabled immediately.


Madam Speaker:: The questions enumerated by the parliamentary secretary have been answered. Is it the pleasure of the
Order Paper Questions
House that question No. 2,393 be deemed to have been made an order for return?


Some hon. Members:: Agreed.


Mr. Flis: 1.	What number of abortions were performed in each province during each year 1975 to 1980?
2.	For the same period in each province (a) what was the percentage of these abortions in relation to (i) population (ii) births (b) how many abortions took place in hospitals (i) with (ii) without abortion review boards and what are the names of the hospitals?
Return tabled.


David Michael Collenette: I ask, Madam Speaker, that the remaining questions be allowed to stand.


Madam Speaker:: Shall the remaining questions stand?


Some hon. Members:: Agreed.


Mr. Cossitt:: Madam Speaker, I would like to refer very briefly to certain questions that have gone unanswered for a great length of time. I refer to question No. 30, which I put on the Order Paper approximately two years ago, if my memory serves me correctly, and I have renewed it on successive Order Papers. It seems to me that it is a very simple question that could be very simply answered. It asks for the names of the Canadian Transport Commission members and/or their wives who have passes on Air Canada. That question has been outstanding for a long time, which leads one to think that there must be some type of cover-up going on.
Another question is No. 93, which simply asks for the list of executive assistants and special assistants to cabinet ministers. That should not be a national secret. It also asks, and this may be the touchy part, for the names of those who are under contract to cabinet ministers, what the contracts are for and what the amounts are.
Question No. 136 has been on the Order Paper for over a year. It deals with the fact that in the May, 1979 election I asked about the Liberal party renting an aircraft from Air Canada and when the following election came about in February, 1980, the aircraft still had not been paid for. It was confirmed to me by people in Air Canada about three months ago that the answer had been prepared for the government and would no doubt be tabled in the House within a week. As yet, absolutely nothing has happened.
There are four other questions, Nos. 775, 776, 111 and 1,057, all concerning a Lionel Martin, a freelance broadcaster with the CBC, I understand, who was broadcasting from Havana. I asked if the government would confirm that he had said certain things on the air in great praise of the Castro regime, to the point where in a matter of two hours he was

June 1, 1981
Order Paper Questions
able to determine that 10,000 refugees in the Peruvian embassy were nothing but a bunch of thieves, prostitutes and criminals. This was pretty fast work in two hours.
The last question that I would like to ask why it has not been answered is one for which I do not have the number in front of me but I am sure the parliamentary secretary will be familiar with it. This is a question about the Prime Minister (Mr. Trudeau) going to Jamaica and accepting as a host Sir Harold Mitchell, chief executive and director of Luscar Ltd. a large coal enterprise in western Canada. I asked if the Prime Minister had followed the guidelines that he and his government set down, namely, that any benefit of a value exceeding $200 must be reported. That question has been on the Order Paper for one year and one month and is unanswered. It would seem to me that it would be a simple thing to answer that. Apparently the Prime Minister has gone back and accepted such hospitality again.
He drew up the guidelines, Madam Speaker. None of us can do anything, if we are over there in the seats of the mighty, over $200, yet he is apparently not following his own guidelines. I want to know why. Why will he not tell us? Obviously it is embarrassing or it would not have taken over a year to get an answer.
Those are the questions that I would like to draw to the attention of the parliamentary secretary. If he could possibly tell us now when some of them will be answered, it would be helpful. I hope he will not give us the percentages of how many he has answered of mine and how many come through every day, how wonderful everything is and how they are trying their best and that the questions will be answered soon. The government's definition of soon, unfortunately, does not correspond with what most of us think soon really means.


David Michael Collenette: Madam Speaker, the hon. member for Leeds-Grenville (Mr. Cossitt) seems to have answered his own questions and has left me very little to say. Perhaps for clarity I could underline the fact that I have made a note of the questions he has brought up and I will do my best to get the answers.
As he knows, a number of questions are placed on the Order Paper every week. I think the hon. member for Leeds-Grenville is probably the greatest user of the Order Paper and that, of course, is his privilege. It requires a lot of time to get these answers, however, and it is a lot of expense.
The hon. member failed to mention that we have answered many of his questions recently, some of which are of long standing. I am sure he would not want to convey the impression that he is ungrateful that those answers have been tabled in the House, so therefore I bring that up.
Finally, I would like to point out that over 80 per cent of all questions on the Order Paper have been answered. I hope that we can answer the balance by the time the session ends.


Madam Speaker:: Orders of the day.



GOVERNMENT ORDERS


Mr. Bert Hargrave (Medicine Hat) moved:: That this House condemns the government for its failure to help alleviate the harsh and harmful effects on Canadian agriculture of its deliberate high interest rate policies, for its failure to honour its responsibilities to the Canadian agriculture industry during the present time of economic crisis, and for its failure to take other positive steps to assist the Canadian agriculture industry such as:
1)	extending the small business development bond to unincorporated farmers;
2)	amending the Farm Credit Corporation Act, the Agricultural Stabilization Act, and the capital gains tax to ensure that Canadian farmers have access to necessary and sufficient funding; and
3)	redirecting its spending priorities to positive agricultural programs which would benefit Canadians as a whole.
He said: First, Mr. Speaker, I would like to welcome our Minister of Agriculture (Mr. Whelan) home from his world travels. I hope the minister will stay in the chamber long enough, not only to participate in this debate but also to listen to some of the words of wisdom that I am sure will emanate from this side of the House. In any event, I say welcome back to our minister.
I think the motion we have just heard read is most appropriate in that it touches on and deals directly with a number of issues which are currently of tremendous importance to agriculture all across our nation. For that reason, I am pleased to lead off in this debate.
Over recent years, this House of Commons has not turned its attention to agriculture very often in an opposition day debate. Most of us would agree that it is important to turn our attention to this subject more often if we truly recognize the unquestioned importance of agriculture and the production of food to our nation. Our Canadian agricultural industry shares a disproportionately large amount of capital and operational costs when compared to most other industries. This is due mainly to the enormous amount of land required that at present day capitalized values, is completely impossible to justify in terms of agriculture production. Present day interest rates and escalating inflation are major contributors to this situation.
A recent feature story in The Globe and Mail pointed out that in Ontario debt service is now close to being the largest single farm cost. For 1980 it shows that cost to be $436 million, up from $374 million in 1979, an increase of 16.5 per cent in just one year. Feed costs in 1980 at $588 million were the highest. The story pointed out that by 1985, which is four years from now, Ontario farmers will owe $8 billion. It is fair to suggest that this same situation exists in most other farm areas across Canada.
In southern Alberta, one of our irrigation districts, irrigation farm costs have gone up this year by $6.14 an acre due to the
June 1, 1981

increased cost of natural gas alone. This is the natural gas used for fuel and manufacture of fertilizers. That is direct consequence of the two natural gas taxes, about which we are hearing so much in Bill C-57. It is tragic and most unfortunate but right across Canada we are now witnessing a very significant increase in farm bankruptcies and bank foreclosures, surely a discouraging situation for younger farmers and those who are about to start farming.
Since the Easter recess, we have been encouraged by public remarks of the Minister of Agriculture to the effect that he was truly aware of the extreme financial hardships in agriculture; that he was fully aware of the inequity and unfairness of present monetary and fiscal policies toward agriculture; and that he was most surely aware of the government's loan guarantees to the troubled Chrysler and Massey-Ferguson corporations.
The minister expressed support for the widespread and popular suggestion that the small business development bond should be modified and broadened in its application to agriculture. Surely there is a genuine need for this financing device to apply to unincorporated farmers and that its provisions include farm operating expenses as well as capital expenses.
After recent comments from the Governor of the Bank of Canada and from the Minister of Finance (Mr. MacEachen), most of us have to conclude that this government has no plans other than to sit out the situation and follow the trend line of the United States Federal Reserve Board's interest rates. Yet in spite of this dismal outlook, there seems to be a feeling- indeed, it is the expectation of all sides in this House-that the small business development bond approach will be modified as so many members and agricultural groups have suggested. That is the very least the government can and should do.
I want to pause a moment to say that I am sure most of us have already noticed a letter from the Minister of Agriculture on this subject which appeared in today's Ottawa Citizen. 1 want to read into the record two short paragraphs so that we can all be conversant with it. In part, this letter reads:
Under consideration is a change to the small business development bond section of the act to allow unincorporated farmers and businessmen to qualify for up to $500,000 in low-interest loans.
That section restricts banks to interest charges of no more than 10 per cent.
I am also considering changing the lending policy of the Farm Credit Corporation by instituting a moratorium for three years on payments of interest and principal on corporation loans.
I was very glad to see that letter, and I hope there will be a follow up very shortly.
I want to come now to a subject which is a little closer to my heart, but nonetheless just as serious, namely the Canadian beef cattle industry. I have a few remarks to make about it. Our Canadian beef cattle industry is presently struggling with the economic situation that I outlined in my opening remarks which applies to agriculture as a whole. As cattle producers, we are seriously concerned about the future of our Canadian industry in both the short term and the long term. We suffer from a lack of confidence in the long-term future direction and development of our cattle industry.
Agriculture
In spite of a 2 per cent increase in beef-cow numbers in
1980,	according to a Statistics Canada figure, we are still probably at the bottom of the numbers cycle because of the fairly high rate of female slaughter in 1980. In my opinion, because of industry uncertainty we are essentially still at the bottom of both the breeding cycle and the beef supply cycle. Several other situations combine to add to our current cattle uncertainties.
Starting about a year ago, cattle feeders have consistently lost money for at last ten of the last 12 months due primarily to high interest rates, high corn and barley prices and abnormally high levels of live fat cattle imports from the United States over the last five months, a situation which still continues.
Another area of concern is the aftermath of three separate drought years across the western prairies in 1977, 1980 and
1981.	I hasten to point out that recent good rains, mostly in Alberta, have changed the current drought picture rather dramatically. However, there are still large areas in southern Saskatchewan that are still very dry and where grain and grass prospect are still very poor.
In spite of good rains, even in Alberta there remains a critical shortage of surface water because of winter drought over the last two successive winters resulting in no snow runoff water for both stock water and the many local, individual spring flood, forage feed projects. That is where the drought is hurting, even where we have had wonderful rains. There is no surface water because there was no snow for two years in a row. The significance here is that for the second year in a row forage feed supplies for cattle will be poor, and carried over reserves are almost non-existent after the previous severe winter for feed stocks.
Another significant drought development was the movement of an indeterminate number of feeder cattle to feedlots and cows with calves at foot to market this spring. There was a serious movement of this kind of cattle in both Alberta and Saskatchewan and maybe Manitoba, although I am not sure of that. In spite of our cattle industry's position at the bottom of the number and supply cycle, 1980 total meat supplies were at a record level of 218 pounds per capita, with beef and veal at a total of 90.9 pounds, pork at 71.3 pounds-an all-time high for pork-poultry at 51 pounds-also an all-time high-and lamb and mutton at 2.5 pounds per capita.
On April 15 the Minister of Agriculture announced there would be no stabilization payments for slaughter cattle sold in 1980. The announced 1980 support price was S75.88 and the national average market price was $76.37, just half a cent per pound above the support price.
In view of the state of the industry, as I just outlined, and the point that we are at in the cattle cycle, and in view of the potential proliferation of balkanizing provincial stabilization programs, discretionary pay-out for beef above the required minimum would have seemed appropriate by the minister this year. The minister has already established a precedent for

June 1, 1981
Agriculture
moving above the mandatory minimum support level of 90 per cent of the previous five-year average market price. He moved it up to 95 per cent and even to 100 per cent on other occasions. Why not this year when it is needed so desperately?
I now want to make some comments about the very recent hog stabilization payment announcement on May 21. Agriculture Canada announced a stabilization program of approximately $9, a few cents below it, per finished hog marketed during the fiscal year ending March 31. However, provincial hog stabilization payments will be subtracted from the amount payable under the federal plan. This is inconsistent with last year, when there were no penalties to discourage provincial subsidy programs and provinces now are actually being encouraged to get into some form of provincial subsidy. For example, Quebec has its own subsidy on weaner pigs and still gets the full federal payment while other provinces with subsidies at market hog level get no federal payment. Similarly, the British Columbia hog plan is not penalized because of the manner in which their program operates.
Over recent years the minister has been highly critical of the obvious balkanizing impact of the various provincial hog programs, and quite properly so. In this new announcement, not only is he inconsistent, but he is actually encouraging more balkanization of the Canadian hog industry. Moreover, many farmers, especially cattlemen, will now feel their concerns about stabilization are justified in that the government can manipulate the stabilization program in several ways, depending on the politics of the day and the money available.
Now some comments about the subject of beef imports. I am aware that the new meat import legislation will begin detailed examination in our standing committee tomorrow. I am very glad that we are getting to that stage of discussion; therefore, I do not intend to discuss that important bill in this opposition day debate. However, there are certain related matters pertaining to the guaranteed minimum access levels of beef imports that were negotiated during the Tokyo round of GATT negotiations that must be mentioned now.
I feel very strongly about the lack of incentive and confidence in the future of our Canadian cattle industry, as I have already indicated. This, referring to the GMA levels that came out of that Tokyo Round, is perhaps the single most important factor contributing to that negative and depressing feeling aobut our cattle industry.
It poses this key question: Is it worth while to spend 20 years or more becoming established in a beef cattle operation at the cow-calf-yearling level, on the grass, only to realize that our offshore competition will continue to get an ever-increasing share of our domestic beef market because of an overly generous guaranteed minimum access quantity base negotiated three years ago at the GATT, and that includes a human population growth factor to guarantee the growth of that offshore import share? That is the most depressing factor of all. It is discouraging cattlemen across Canada today. They are saying bluntly there is no future in beef cattle.
There is no question that our GMA level was set too high. This situation is more obvious now that our per capita beef
consumption is lower than when the negotiations took place. As a result of that human population growth factor, those offshore imports will make up a larger and ever-increasing share of our market relative to the U.S.A. since the United States did not agree to a similar human population growth factor in those negotiations.
I now come to another topic, which is very important to the cattle industry today because it addresses some of the serious concerns in which we are involved. I refer to it as a deferred income averaging trust proposal. The minister is well aware of this program. He has heard a lot about it in recent years.
Recently the Minister of Agriculture has been making suggestions with respect to some form of livestock, especially cattle, insurance program, probably to be patterned after the crop insurance program if that is possible, and I rather doubt it. A much more appropriate proposal is the concept of a deferred income averaging trust account that has been put together by some provincial governments and the Canadian Cattlemen's Association, supported by a large number of its component members across Canada.
The plan is actually a form of personalized stabilization that would be applicable to any farmer. Essentially, the proposal would require changes in the Income Tax Act to allow individual farmers to set aside farm income into interest earning accounts in good years, for withdrawal as taxable income in low income years. Such accounts would be similar to RRSPs, but with a much higher ceiling. This personalized income averaging trust would deal directly with at least two inherent characteristics of agricultural production, especially in the cattle industry. They are not presently recognized and accommodated by our tax structure.
First, the cyclical nature of livestock production, especially beef cattle, results in quite dramatic changes in income. There are two aspects to this, the approximate ten-year duration of the cattle numbers cycle and the beef supply cycle, as well as the four-year individual production cycle of the cow-calf-yearling producer.
No other major agricultural commodity is subjected to such extremely long cycles, making planning, management and forecasting so difficult and even impossible. I made that statement several years ago and was challenged by an orchard man, a fellow raising apples. He told me how long it took to get an apple tree into production. That is probably true, but when talking about a major agricultural commodity I suggest that my remarks of the time still stand.
Weather and climatic conditions have a more profound and direct impact on agriculture than on most other enterprises, and I am sure that is an understatement. This climatic impact bears directly on net farm income whether localized or more general. Recent droughts-and I will cite three of them; 1977, 1980, and this year up to this stage-are good examples of this situation. Cattlemen learned long ago-I go back now to the lessons of the 1930s-that the prudent course to follow during a drought is to make your cattle numbers fit your available
June 1, 1981

grass and hay. This means cutting your cattle numbers sometimes very drastically. For the second year in a row I have had to do that very thing in my own operations.
An income-averaging trust would allow drought cattle sales, which would be well above normal because you would be selling off many more numbers in a given drought year, to be exempt from tax in that year. Surely it is illogical and without understanding for governments to tax disaster situations, but that is what has been happening under the present tax structure. We sell additional numbers of cattle in the face of a drought, the proper thing to do, and then have to face the consequences of a much higher taxable income.
Better pasture management would evolve and the income from such drought-induced forced sales would be left earning interest if we could use this income-averaging trust concept. That same income could be withdrawn in a subsequent low-tax year and used for restocking or for operating funds during a pasture and feed recovery stage. I would point out that that recovery stage of ranges that get eaten down to a point where cattle must be removed can sometimes take two, three or four years, before the grass comes back, assuming, of course, we have adequate rainfall.
With respect to additional supplies of forage hay needed for wintering the basic cow herd, I have always reasoned that, in the event of needed government assistance, such as in 1980 when the government brought in its herd maintenance program, the criteria should be based on the amount of such feed necessary over and above the long-term average requirements which are produced on the individual cattle unit.
This concept is based on the assumption that most cattle units have developed their own forage feed production systems over many, many years which would see them through two or three average winters. When one bad one comes along as a result of a drought, they would have their own reserves to carry them over. When that feed supply does not grow, this becomes another matter.
Our present tax laws work against these longer term cyclical, climatic and unpredictable aberrations I have already discussed. It is well known that farmers for years have attempted to defer and average their incomes through very destructive and wasteful year-end purchases of livestock, machinery and other production inputs. We are all familiar with that. In the month of December you size up your situation having regard to possible income tax and look at the merits of sometimes buying significantly large numbers of cattle or machinery. This is simply not good business but it becomes necessary under the present tax structure.
Let me hasten to add that the five-year tax averaging provision presently available to farmers is much less than adequate due to the extreme cyclical nature of the cattle industry. Many of our situations, as I already indicated, last much longer than five years.
1 suggest that the obvious merits of individual, self-managed stabilization accounts make this trust account proposal much less costly to the government and more efficient to administer
Agriculture
by the government. The proposal has the support of the Canadian Federation of Agriculture and most provincial governments.
Before leaving this very important topic there is a related matter worthy of comment dealing with the Farm Credit Corporation. I am sure most of us are aware of the shortage of funds in the FCC. It has been an almost annual occurrence in recent years during the last quarter of the fiscal year. Most of us would quickly agree that additional funding is necessary, and necessary now, either from government or the private sector.
In this latter respect, why not use the individual averaging trust fund I have been talking about as a source of revolving funds for the Farm Credit Corporation? The FCC could administer the fund and it would be a continuing source of their financing needs. Among other advantages, the plan would be well received if only because of the concept of well established farmers helping young farmers get started, and that is a very necessary thing these days. I have never seen conditions more difficult for new farmers to get out on their own and get started.
Before concluding these remarks, Mr. Speaker, I would like briefly to assess the prospects and the challenges of the decade we are beginning, not only for agriculture generally but, perhaps more particularly, for our Canadian cattle industry.
First there is a developing challenge for Canada, especially western Canada, to help supply a growing beef deficit in the United States west coast market area. That deficit is presently
30,000	head of cattle per week, and that amount is about one and one half times Alberta's present production. This deficit in the U.S. west is presently supplied from the mid-west states which are considerably farther away from that market area than is the province of Alberta and most of the province of Saskatchewan.
With ever-increasing pressure on disposable income, consumers will be even more price conscious, especially of the more expensive foods, usually led by beef. All meats will become more competitive and consumers will be demanding a leaner grade of beef. This is, or will be especially true in the United States.
Rising production costs, such as fuel, fertilizer and much higher costs for transportation and distribution, will tend to keep cattle on improved forages longer, and cattle feeding and processing will tend to locate near the point of origin of those live cattle, and by that I mean, at least in Canada, in the black soil zones of the western provinces.
Our livestock transportation problems will worsen. Our railway stock cars are becoming obsolete very rapidly, and both railways have clearly indicated they have no intention of replacing them.
There is an urgent need for interprovincial truck licensing agreements to facilitate long-haul trucking.

June 1, 1981
Agriculture
The Crow rates and domestic feed grain pricing policies remain key deterrents to real progress in beef and pork production. The government should find ways of encouraging the two groups in the west, the western agricultural conference and the commodity coalition, to continue their negotiations which are now reasonably close to a compromise on this entire debate. I think some appropriate urging on the part of the government in its own way might help to bring this serious problem to a satisfactory conclusion.
Various provincial incentive programs in both cattle and hogs, some with top loading features, not only will eventually make federal harmonization more difficult but will impose an increasing risk of denial of access to United States markets for cattle and hogs. That is a very serious situation that could develop over the current decade.
Our Canadian meat market development plans must ensure that our quota allocation policies enable us to expand sales into the United States. Right now there are some factors working toward actually reducing those quotas, which is a situation we should never allow to happen because, after all, we are sitting next door to the biggest and highest beef market in the world and should take advantage of it.


Stanley J. Hovdebo: Mr. Speaker, it is a pleasure to speak to this motion today and I congratulate the member for Medicine Hat (Mr. Hargrave) for initiating this debate. I know him as a person who sincerely believes that the government must show concern for the farmer in these desperate times and must do something about high interest rates and the high debt load. I am also glad to see the Minister of Agriculture (Mr. Whelan) here today. In my approach to this debate I am going to cover a lot of points besides that of cash flow.
I do have some difficulty in supporting some of the positions that the hon. member for Medicine Hat takes in many areas, although the first two points of his resolution could be adopted as a very helpful policy. We have heard much in this House and elsewhere about the sanctity of the family farm. All parties in this House agree on that. However, there the consensus seems to stop.
In order that food production can be maximized for Canada and the world we must give priority to the policy of security of farm income. Canadian farmers have always been eternal optimists, so much so that they continue to lose money year after year and still go on attempting to produce. Much of this optimism has been the result of minimal personnel requirements for running a farm and because those who work on the land are, in the best sense of the word, survivors. To survive, farmers have learned to make the most of as little as possible. The prairie farmer, and I speak mainly of grain farmers, for many years ran on what my father used to call haywire and horse manure. Haywire was used to repair almost everything, to keep the farm tied together. Horse manure was part of the basic fertilizer and kept the crops growing, and the horse was the main source of power.
In those days the farmer accepted whatever he got for his produce and very often received nothing for his labour. However, things have changed. Security costs more now. There is much more input into all types of farming these days from outside the farm, and most of these inputs must be purchased for cash. The farmer must have that cash to operate; therefore he must be paid enough for his produce to provide that cash. He needs that money to buy fuel, the price of which is going up daily; he needs it to buy power. A tractor nowadays can cost anywhere from $50,000 to $80,000. The cost of fertilizers and chemicals, which are closely related to fuel prices, are increasing very quickly. He has to have money to buy machinery and the increases in the prices of that machinery over the years has been fantastic. A machine costing somewhere around $500 before the war now costs $10,000, a twentyfold increase. The farmer needs to pay for labour, his own as well as others. Again, the cost has increased considerably. He also has to pay for transportation and for land.
Farming has survived as a way of life because many people find it so appealing that they continue to stay on under very adverse circumstances. But farming should be treated as any other business which must be nurtured and protected to survive. The family farm way of life has many natural enemies and the motion we are debating points many of them out. Surprisingly, the hon. member's motion and speech point out a number of suggested solutions. I say suprisingly because in his appeal he suggests that the government should intervene in farming more and more often. I am puzzled by that because what we have here is a free enterprise Conservative party asking the free enterprise Liberal party to intervene more often and more fully into the free enterprise area of farming. However, agriculture must have this kind of intervention to survive.
This crisis in farming that we are faced with right now is not new, nor is it unique. It is but another chapter in a 70-year period of instability of markets, fluctuation of prices and depression of incomes.
There are two basic problems facing agriculture today which must be considered. One is the cost of production and the second is the related question of prices, markets and incomes. The hon. member for Medicine Hat zeroed in on the problem of cash flow and the effect of the monetary policy of the government on the cash flow of farmers. The effects of the high interest rate policy and the monetarist policy on farmers have been greater than on most other industries. The government should not be asked at this time to deal only with problems of money. It should look at all the factors which are part of those two basic suggestions-the cost of production and the related question of prices, markets and incomes.
We need to establish as quickly as possible some kind of income security for farmers. I hope the minister agrees with this position. We can do this only by establishing producer control boards which have some effect on the supply of products on the market. We must prevent the dumping of agricul-
June 1, 1981

tural products on the Canadian domestic market. Some changes in the Meat Import Act will possibly start to control the dumping of agricultural products on the Canadian market.
Also we must establish market prices for all farm products at a level which will cover the cost of production. In the past this was part of the reason for the establishment of the board, but generally it should be a policy of the government right across the country. The farm is the only place where the free market is expected to work. One would not expect General Motors to produce cars by the thousands, put them on the market and then say, "How much can I get for them?" They start out knowing how much the cars will cost and add on a substantial profit; this becomes the price of the cars. However, farmers and other primary producers are forced to produce, put their products on the market, and hope they receive good prices for them.
Also we must establish some kind of insurance for that income, such as crop insurance, a stabilization policy or some type of insurance for all producers. We should look at some basic guaranteed income for farmers.
I should like to deal with the area of grain marketing because it brings into Canada a major portion of our foreign exchange. We must establish an initial price for grain going overseas or being sold domestically at a level which covers the cost of production. We must expand the jurisdiction of the Canadian Wheat Board so that all grains come under such a ruling. We should guarantee farmers some return on their grain, even in those years when the market is not large enough to handle the entire crop.
Now I would like to turn to the cost of production with which farmers must deal. In the last few years a major concern has been the cost of land. There is a myth that if farm sizes are increased, the total number of producers declines and the efficiency of farms increases; the larger the unit, the more efficient. If we compare a prairie farm of 2,000 acres which is being farmed by one farmer with two farms of 1,000 acres each, we will see which one produces the most grain. Size does not necessarily mean efficiency. The process of attempting to increase farm size has resulted in sharp competition and inflated prices. Therefore, we must do something about limiting the size of farms; this should be looked at as an area of concern.
We must prohibit foreign and corporate takeovers of farm lands, again to limit the size of farms and increase the possibility of family farms surviving. Also we must look at interest rates which allow farmers to buy.
The other day I was interested to hear the hon. member for St. John's West (Mr. Crosbie) speak about the cross of gold which was being pressed upon Canadians. I think he referred to a speech of William Jennings Bryan who was running as the Democratic presidential candidate in the United States. At that time Mr. Bryan became the champion of the emerging west by saying that the west must be protected from eastern bankers and protection-minded Americans who wanted to retain the gold standard. Perhaps the hon. member for St. John's West is attempting to become the champion of the
Adjournment Motion
emerging west this time around. Mr. Bryan talked about the need for cheap money, the need for funds for farmers to break their land, equip their farms and harvest their crops. These are the same requirements which farmers have today.
We can all agree that the high interest rate policy of the government has the same effect now as it had back in 1896. I think the motion which is before the House should be accepted, since it condemns the government for not doing anything about this particular area of concern.
What we have seen in the past 30 months is the death of the cheap money policy for agriculture. This destruction by the Bank of Canada, conducted by Governor Bouey, aided by the hon. member for St. John's West when he was finance minister and by the hon. member for Cape Breton-Highlands-Canso (Mr. MacEachen), continues. Their policies may suit the bankers. They may be worth while as far as money and finance are concerned, but they do not suit the farmers in Canada today any more than they suited the farmers in the United States in Bryan's time, 1896.1 wonder what we can expect the Canadian farmer to do when he is faced with an interest and money policy which is based on beggar thy neighbour interest rates and which are designed to keep the balance of payments of the country at bay while farmers and other working people are offered a sacrificial lamb because of mortgage payments and the interest which they must pay. I also wonder what the farmers are supposed to make of the gradualism of the monetarist doctrine which is supposed to cut inflation while increasing everyone's interest costs substantially. If the government's policy is anti-inflationary, then thousands of Canadians have yet to find any evidence of it in their mortgage payments.
In addition to wanting the government's policy changed, as advocated by the hon. member for Medicine Hat, we want to put before this House the kind of policies which will change the structure of farming and agriculture in this country, to make it possible for a farmer to feel secure in his production.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Ethier):: 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 Winnipeg North Centre (Mr. Knowles)-Social Security-Query Respecting Aid for Senior Citizens; the hon. member for Algoma (Mr. Foster)- Energy-Exports of National Gas to United States; the hon. member for Vancouver South (Mr. Fraser)-Western Development Fund-Future of Program.
Agriculture



GOVERNMENT ORDERS

[Stage Direction]
June 1, 1981

[Stage Direction]
The House resumed consideration of the motion of Mr. Hargrave:
That this House condemns the government for its failure to help alleviate the harsh and harmful effects on Canadian agriculture of its deliberate high interest rate policies, for its failure to honour its responsibilities to the Canadian agriculture industry during the present time of economic crisis, and for its failure to take other positive steps to assist the Canadian agriculture industry such as:
1)	extending the small business development bond to unincorporated farmers;
2)	amending the Farm Credit Corporation Act, the Agricultural Stabilization Act, and the capital gains tax to ensure that Canadian farmers have access to necessary and sufficient funding; and
3)	redirecting its spending priorities to positive agricultural programs which would benefit Canadians as a whole.
Hon. E. F. Whelan (Minister of Agriculture):: Mr. Speaker, I listened with eagerness to the previous speakers to find some new suggestions which I had not heard before on how to overcome some of the problems facing agriculture today in Canada.
First, I would like to say to the hon. member for Medicine Hat (Mr. Hargrave) who led off the debate that he might have left the House with the impression-an impression which I am sure he did not wish to leave-that I was on a vacation travelling around the world. In order to be back here for this important debate today, I travelled steadily for 24 hours yesterday.
I also wish to say to him that I was not leaving a luxurious place but, rather, we were in a rather humble country called Yugoslavia, at the World Food Council meeting. I had discussions with the minister of agriculture there with regard to signing a memo of understanding to exchange scientists, technicians etc., between our two countries.
I was very eager to hear some new ideas, but I must say that I have not heard one so far. I hope the rest of the speakers in this debate from the party opposite will be more progressive, if you will pardon the pun, as time goes on.
The hon. member for Medicine Hat is very interested in the cattle business. He has been saying the same things about the cattle business for many years. He will probably say that I have been saying the same thing about it, too, for many years. We have known one another for quite some time.
The past ten years in the cattle industry has brought more change than in any 70 previous years of its history. I remember when I was First Minister of Agriculture my advisers told me that I could expect one bad year out of five. Then when we had two bad years they said they had never seen anything like it. Then when we had three bad years they said they had never seen anything like it and that something must be going wrong. They had not been taught the economics to show three bad years could happen out of five. Then when four years out of
five were bad in beef economy they did not know what to do because they had never been taught that kind of economics in school. It was something which they needed to develop a new theory about.
When we look at other areas of production we see some which are very healthy, regardless of what has been said by both hon. members who spoke before me. They left the impression that the whole of agriculture was economically unsatisfactory. They know that is not true. There are many sectors in agriculture today which are very healthy. For instance, the grain producing sector is pretty darned healthy when you look at the advance demand for payments which are interest-free.
By the way the two previous speakers spoke one would think there would be a tremendous demand for that money. This year those payments have been slightly more than the year before but less than SI00 million. I have said that we would use over $100 million in interest-free payments to farmers who could not deliver the grain, but the reason we did not have to give that money to them was because they were delivering their grain. The transportation system was handling that grain better than it ever did before. It handled a year and a quarter's supply of grain in 12 months, which is a phenomenal thing for that terrible, dilapidated transportation system which some people say we have.
Maybe we have some problems in our transportation system, but we still have the best one in the world, and that includes the United States of America. It includes the railroad transportation systems in Japan and West Germany where there are tremendous economic theories. You can read articles about what tremendous giants these countries are but their railroads have tremendous deficits every year. Those countries do not do very much about trying to overcome that deficit either.
When the hon. member for Medicine Hat talks about offshore beef affecting our markets, he is talking through his hat. That beef did not affect our markets at all last year-he knows that because they did not even fill their quota. We saw the largest depression ever in the price of beef last year. Why? Because there was overproduction of domestic red meats in Canada and North America which depressed the price of beef more than anyone imagined. There was unrestricted production of pork which took away from the beef market. Consumers swung over to the depressed prices of pork and discontinued eating beef. In turn, beef prices went down. That was the free market system working to its maximum, Mr. Speaker, causing hardship, heartache and economic disaster, the likes of which we have never seen before.
That system just does not work in 1981. The economic theory that the market will take care of its own needs is wrong and cruel. What I am saying, when I talk about supply management, is that other people have agreed with those kinds of measures. They are the people who are not writing me letters about going bankrupt and they number about 70 per cent of the producers in Canada. They are involved in provincial boards which provide marketing contracts. If they are efficient producers they produce high quality products and
June 1, 1981

receive a certain return, which is negotiated at the start of the year. The province the hon. member for Medicine Hat comes from has some of the strongest provincial marketing boards in all of Canada.
I do not understand why they do not want something better for beef, because under supply management one does not have the problems that he worries about, such as offshore beef or any other beef coming in from any other part of the world. Under GATT, the supply management type of system, imports are controlled that way. One does not have to worry. When beef took over 24 per cent of the market in Canada this year, was it for one week or for two weeks? No, it took over the slaughter market for more than nine weeks in Ontario, 24 per cent of it on average and 9 per cent all across Canada.
When I met the secretary of agriculture, Mr. Block, the other day, I said to him: "What would you do in your country if, say, we could take over your market that long?" He said: "Oh, you could not do it." He knows we cannot do it. We could ship all our cattle in Canada and only take over 10 per cent of his market for a few weeks, and he would never have to worry about us again. Then we would bring in all our meat from some place else in the world. We would do the same for coffee or anything else we do not produce: we pay according to the tune that the piper plays.
Coffee in Costa Rica costs $1 a pound, but we pay $4 for the same coffee in Canada because it is not produced here. We pay what the importers tell us that we will pay. I get so sick and tired of hearing about dreams that we are going to have this system work so good that everyone will be economically stable, prices will be stable, and economic conditions will improve.
However, when we see the other groups in Canada which are surviving, are doing a good job, are paying their bills and making investments, is there something wrong with that? If one reads the history of poultry production in this country, it used to be that a poultry producer was one of the worst risks that any bank, financial institution, or credit union could take on. Now when a poultry producer goes by, they wave and say: "Come on in; we have some stocks and securities that we want you to buy". The dairy farmers are not running around the block to get out of their way, nor are the poultry producers. Most of the horticultural producers in Canada are not doing that either. A strong agricultural economy has been built. The agricultural economy is very strong except for those two sectors which produce red meat, both pork and beef, because they are destroying one another as a result of overproduction, and hoping that the free market will solve their problems.
The hon. member for Medicine Hat said 1 was destroying the principles of stabilization in our country. The principles of stabilization are designed to provide equity among producers and equitable income in a fair manner. It says that in the act. A rich province might put in an expensive support program and then expect me to give it federal money, just as I do with a poor province which does not have the treasury to afford that
Agriculture
kind of system. That is not what the act says and that is not what it is for. It is to provide fairness. Read what the act says and you will have a better understanding.
Six years ago we proposed harmonization of stabilization to the provinces. Some of the farm organizations said: "No way, we do not want it." The provinces said: "Whelan and his government are wrong in providing that kind of organization", that kind of economic stability in agriculture. One of the provincial ministers was at the meeting. He went home and in six weeks implemented it in his province. The province was British Columbia, which is not a huge agricultural province. The federal government actually spends double the money in that province that the province does. However, he went home and put that plan into force for beef producers in British Columbia. Even some of the beef producers who objected to the income insurance plan joined it just as soon as it became law. I said to one: "Does it work?" He said, "You want to bet it works!" I said, "Does it cause inefficiency?" "You want to bet it doesn't cause inefficiency; it gives me an incentive to produce." It is the only province in the country which increased beef production when the rest went down. Some of them went slightly down, and some even went down more than that.
In different parts of Canada it is said they have such a tremendous program for beef in Quebec, they are going to take over the market for beef. They say they have increased production of beef in Quebec 100 per cent. A hundred per cent of what? It was hardly producing any beef before and it is hardly producing any now. It would take another 40 years at the rate it is increasing production, but it is guaranteeing 95 cents a hundred weight on the hoof for beef cattle. Is there something wrong with that program?
Let us make a comparison with rich Ontario alongside Quebec. Quebec spends $400 million plus on its agricultural economy. Rich Ontario, the largest agricultural province of all of Canada, produces 28 per cent of the agricultural worth of the whole nation, but spends only a measly $200 million for its agricultural schools and every other program. We spend more in Ontario than the province does. However, one would swear by what they are saying on the unfairness of hog stabilization, etc., that we are not doing anything for them. Did hon. members see what they did in eastern Ontario? The hon. member should be aware of that.


Walter David Baker: Who?


Eugene Whelan: He is on the list to speak later in the debate. I hope the hon. member mentions how they cut back the tile drainage grant in eastern Ontario.


Walter David Baker: You just wait!


Eugene Whelan: I hope the hon. member will flail them in Toronto for doing that. Tile drainage assistance is being cut back. That great farming government down in Toronto, the one that thinks so much of everyone, says, "You are not doing anything."

June 1, 1981
Agriculture


Walter David Baker: They do their farming on the Gardiner Expressway!
Mr Whelan: The old program of interest-free advance payments for grain has been there for a long time. As I said, this year it is not being used a tremendous amount.


An hon. Member:: One has to have grain on the farm to get the advance payment.


Eugene Whelan: The farmer can get it if he is not a member of Parliament. I hope the hon. member is not applying for it because he is not entitled to it. A member of Parliament is a Queen's representative, and it is illegal for a Queen's representative to enter into a contract with the Queen. However, farmers can get up to $45,000 interest-free if there are two sons and a father or three brothers or three members running a farm. They can receive up to $45,000 interest-free. We have given money to the horticultural industry in Canada this year. We have advanced loans to those organizations which can prove that they will have the capacity and the ability to repay, in case some of the producers do not, to the tune of $50 million, interest-free also.


Walter David Baker: What about the small business development bond?


Eugene Whelan: We have done this for the producers, yet we are told we are doing nothing. We pay up to $500,000 for controlled atmospheric temperature storage and cold storage and jacketed storage for storable products. For instance, the B.C. tree food growers of apples, pears, cherries, etc.-and the hon. member over there is waving. He is so happy with the program that I initiated.


Joseph Jacques Jean Chrétien: Give him a standing ovation!


Eugene Whelan: They received $11 million interest-free so they did not have to sell their crops in a distressed fashion. The hon. member knows that the industry in the province of British Columbia is probably in the healthiest state it ever has been in. Parts of that industry in Ontario have taken advantage of that same program.
Then we can move into the western grain stabilization program where we put in $2 for every $1 that the producers put in. How much did they pay out? They say we never did anything, but how much did we pay out? We paid out a total of about $360 million since that program has been in force. It was not totally federal money, but over two thirds was federal money which was paid out. That fund is building up rapidly because they did not have to make a payment last year. I doubt if they will have to make a payment this coming year either because there is a demand for grain and the prices will be good, as hon. members know. That is one of the reasons land is still as high priced as it is in western Canada. If the agricultural economy was so bad, would anyone pay a reasonable price, or even, some might say, an unreasonable price, for land?
The agricultural industry is healthy and can become even healthier with some of the things we need to do. These farmers should organize and run their own businesses. For instance, where are the most successful pork producers in the world? In Denmark. The distance from one end of Denmark to the other is equal to the distance between Toronto and Windsor. How many hogs are produced in Denmark? Twelve million hogs. How many hogs do we produce in Canada? With over 4,000 miles from sea to sea, we produce 12 million hogs. Who markets the hogs in Denmark? The farmers market 99 per cent of them. Who markets the hogs in Canada? Everyone does. There is a hodgepodge of marketing systems. The poor Americans are beings subsidized to the tune of some $30 a hog, yet it is one of the richest economies in the world. The same thing is being done for Japan. The same thing is being done for the people who send satellites around the earth and spaceships to the moon, the U.S.S.R. They are buying that product below the cost of production.
It is said that stabilization is the answer to the problem. The hon. member for Medicine Hat has heard me say that stabilization is not the answer, because I do not believe, if we run an efficient system, that we should have to use taxpayers' dollars to subsidize the United States of America, the rich economy of Japan or the U.S.S.R. in any fashion or form with such a high quality product. For instance, in Denmark the pork producers control the production of pork, how many sows, or hogs go to market, and so on. They run the processing plants and they run their world market selling system also. It is an efficient system.
Our pork producers are some of the most efficient in the world. They are not going broke because they are inefficient; it is because they become too productive. We hear economists and politicians say that the problem is that our society is not productive enough and that is why we have inflation. Do they mean that you have to be overproductive, that you have to go broke because you are so efficient in order for the economy to work properly? I say that is a cruel system, one that is unnecessary in the year 1981. It is time that some of the theories on those things were destroyed, just as some of our old farming techniques were many years ago.
The hon. member for Medicine Hat and the hon. member for Prince Albert (Mr. Hovdebo) said that this day is a good thing. I say it is a bad thing, Mr. Speaker. The opposition has ten or 11 more of these days in June. If the opposition really wanted to do something they would give up five of them and we would bring in some legislation which could be passed through the House for the benefit of agriculture.


Some hon. Members:: Oh, oh!


Eugene Whelan: All they will do is talk, as I am doing at the present time. They have a list of speakers today who will not say one thing that is new or one thing that we have not heard before. It may sound good and it may be politically wise but it will not be new.
June 1, 1981


Walter David Baker: A point of order, Mr. Speaker. I wonder if I might ask the hon. gentleman a question?


The Acting Speaker (Mr. Ethier):: Would the hon. minister permit a question from the hon. member for Nepean-Carleton (Mr. Baker)?


Eugene Whelan: Yes, I will, Walter, for you any time!


Walter David Baker: The hon. minister mentioned that his department had legislation to put through. When is he going to put it on the Order Paper? We would be delighted to see it. Perhaps we could make some arrangement, if he would put his legislation on the Order Paper.


Eugene Whelan: Mr. Speaker, I put the Meat Import Act on after I had begged, as he knows full well. I thought it would have been rushed through but they talked about the agriculture estimates and all kinds of things. Now we are finally getting to the Meat Import Act after it has been on the Order Paper for more than six weeks. We have plant breeder's rights on the Order Paper and we could bring that in and put it through in half a day. I can bring in Canagrex legislation and put it on the Order Paper. I can bring in amendments to the Farm Credit Act if hon. members would agree to sit 24 hours steady. I travelled 24 hours steady yesterday to get back here for today. If we can sit in the House 24 hours steady and pass that kind of legislation, I will bring it in for sure.


Some hon. Members:: Hear, hear!


Eugene Whelan: They have legislation before them but have not done anything with it at all. I will give them all they want, a whole wagon load if they want.


Mr. Munro (Esquimalt-Saanich):: Have you got a spreader?


Eugene Whelan: I want to say a couple of words about interest rates. I do not think any of us are happy about interest rates being 20 per cent and up, but I recognize that the issues are complex. Even if I were Governor of the Bank of Canada, I probably could not deliver 15 per cent interest rates tomorrow, as some of us would like to see. What I want to do is discuss the impact of high interest rates on agriculture and lay out for you my analysis of the current situation.
Interest rates are a significant cost of doing business for the farmer because the modern scale of agriculture requires a good deal of short, intermediate and long-term financing. Many people today do not realize that in a lot of cases $100,000 short-term credit is not enough; in some farm operations $200,000 is not enough. Some bankers are saying, "Sorry, old boy", or young man, or young lady, we are not going to let you have any short-term financing this year, even though you paid us $50,000", or $80,000, or $92,000, "in interest last year". Letters which I have received from farmers show how much they paid to the banks in interest last year, but some of the banks are saying that they will not go along with them this year. This is my main concern about high interest rates. The banks can do some of the things that members of this House have suggested within the act under which they operate. We
Agriculture
do not have to do what the House leader of the opposition suggested and bring in special legislation. They can provide longer-term money if they want to and they can give them moratoriums on their loans.
Some people try to put across the idea that the interest that banks charge is for handling the money. It is to cover the risk they take. Some people are under the impression that banks must have a dollar on deposit for every dollar they lend.
I have a letter from someone who has worked for one of the banking interests of this nation for many years. He said that in some instances they lend on a ratio of 100 to one. Imagine if I could sell eggs that way, Mr. Speaker! A farmer must have the produce but in many instances all the banks do is change paper. When interest rates increase suddenly and unexpectedly by almost one third as they did last December, and that high level is maintained over a period of months, there is the clear potential for an unacceptable degree of financial failure due to short-run cash flow problems. There has been a significant increase in the number of farm bankruptcies, and the situation bears close watching. I can assure you that the provincial ministers of agriculture and I are monitoring developments very closely.
It is my judgment that the problem at the present time is not serious enough to warrant the sweeping measures which are being proposed by some critics. It would be irresponsible to ignore the fact that realized net income of farmers is expected to be some 15 per cent to 20 per cent higher in 1981 than in 1980, even though interest charges are forecast to go up to 30 per cent.
It is obvious that while all farmers are paying higher interest charges, they are not all being forced to the wall as a result. For example, I am sure that if grain farmers in the west-I have already touched on this-had a hard run, more of them would have applied for interest-free advance loans.
The information I receive indicates that financial failure among farmers-and I am not just talking about bankruptcies- is concentrated among hog producers and beef feedlot operators, according to 90 per cent of the letters I receive. A market problem has clearly existed in these segments of the industry for some time.
I have explained to the hon. member for Medicine Hat that he is living in a dream world if he believes in the free market system where they move cattle across borders and across oceans. For instance, the cattle that came into this country and took over the slaughter market did not come by themselves. Some good corporate citizen of Canada bought them and brought them home and took over the Canadian slaughters market. He was able to make a few dollars on it and that is why he did it. That is the name of that game.
At that time I could have given interest-free money to farmers and they still would not have made a profit because those cattle depressed the market more than the money that would have been given to them interest-free. As the hon. member knows, the price of slaughter cattle dropped as much as 15 cents per pound as a result of the glut of big fat

June 1, 1981
Agriculture
American cattle that came here because they had no home to go to in the United States. Sooner or later I hope farmers in these segments of agriculture, pork and beef, will take to heart what I have been saying about the need for orderly marketing and better management of supply.
When high interest rates were added to the problems faced by hog producers and feedlot operators, who were basically in a loss position anyway, the inevitable exit of producers from the industry in a process of market adjustment was reinforced and made more painful. To say that high intererest rates have caused the farm bankruptcies, foreclosures and forced sales we have observed is to oversimplify the situation.
I took the initiative in April of requesting a meeting with The Canadian Bankers' Association. As a result of that meeting, the association agreed to convey to the top management of the chartered banks my view that, under present circumstances, the banks should be taking a more flexible and considered approach in dealing with farmers who are defaulting on their financial commitments. I am meeting with them again this week. The association also agreed to forward to the chartered banks, for reconsideration, cases of individual farmers which had come to my attention and which I thought deserved a second look.
My staff has been actively involved in talking to individual farmers and their bankers in an attempt to reach agreements that are satisfactory to both parties. In addition, the Farm Credit Corporation is giving special attention to hardship cases in which it is involved as a lender, either alone or jointly with the banks. To the extent that its resources permit, the Farm Credit Corporation is open to refinancing existing indebtedness when this promises to make the operation viable, and where it is necessary to make it viable.
I am not suggesting that this action on my part will put an end to bankruptcies and foreclosures among hog producers and feedlot operators. There are a lot of cases where there was a little equity in the operation to start with. The cumulation of losses in the last two or three years has produced a level of debt which would be unmanageable, and no matter how strong the recovery in the hog and cattle markets, it would be very difficult for them to recover.
However, I have no doubt that many of the farmers who are now defaulting on their financial commitments can have viable operations if they can just be tided over for a few more months, or even for two or three years, until markets turn around and they have time to readjust their operations. My message to the banks is that these farmers should be provided with the additional credit they need to carry on at a normal scale of operations for the next few months. My suggestion is that the banks should get away from the "rule-of-thumb" mentality that anyone who defaults is a bad credit risk and should not be given additional credit. Nor should the banks get too concerned about recent declines in the value of their security, associated with lower selling prices for hogs and cattle. When hog and cattle prices strengthen, it will not take
long for the value of the banks' security to climb back to earlier levels.
I am pleased to see indications that the top level managers of the chartered banks are already aware of the special nature of the problems facing hog and cattle farmers, in particular, and are taking a sympathetic and understanding approach to farm customers who are having difficulties. I think this is a case where the banks can do a great deal to help, simply by considering their long-run commercial interests and the special nature of the agricultural industry which gives them so much business.
Farmers last year paid out $1.5 billion in interest payments and this year they will pay out more like $2 billion. Do you realize, Mr. Speaker, that that figure is more than double the budget which the Minister of Agriculture has? My budget for all of Canada hardly reaches the $1 billion figure. We participate in all regions of Canada in support of agriculture. We do more in support of agriculture than do the provinces, something which a lot of people do not understand.
If hog and cattle markets do not develop in line with current projections, measures specifically directed at these segments of agriculture might be required to maintain the basic core of our productive capacity in these areas. It is a situation which requires close monitoring, and that is exactly what I will be doing.
In this context, I think it is important to keep the farm bankruptcy situation in perspective. There were 222 farm bankruptcies in 1980, up 77.6 per cent from the 1979 level. That is something which makes you angry when you hear that something has gone up 79 per cent; 79 per cent of what? It is just like beef production in the province of Quebec.
Our latest information indicates that there were 93 farm bankruptcies in Canada in the first four months of this year, up 40.9 per cent from the same period last year. If you check small business, you will see the phenomenal comparison. We talk about 222 farm bankruptcies, but nearly 7,000 small businesses went bankrupt at the same time. One has to bear in mind that the bankruptcy rate is less than one tenth of 1 per cent of the farmers in Canada.
A lot has been made of the fact that there never used to be bankruptcies to any extent among farmers. The fact that we now have a greater number of financial failures among farmers in part reflects the fact that farming is run more as a business now than used to be the case. More and more farmers are using borrowed money to finance expensive machinery and equipment and increasing outlays for fertilizer, top quality seed and other purchased inputs.


The Acting Speaker (Mr. Ethier):: Order, please. I regret to interrupt the hon. minister but I must advise him that his allotted time has expired.
The hon. member for Red Deer (Mr. Towers) on a point of order.


Thomas Gordon Towers: Mr. Speaker, would the minister permit a question?
June 1, 1981


The Acting Speaker (Mr. Ethier):: Because the minister's allotted time has expired, unanimous consent of the House in necessary. Is there unanimous consent?


Some hon. Members:: Agreed.


Thomas Gordon Towers: Mr. Speaker, no doubt there is an oversight on the part of the minister or he had not reached a certain point in his speech. However, I understand he has been recorded on tape as saying that the government was going to change the Bank Act in order to facilitate certain benefits to small business people and farmers. Could the minister tell us when the legislation will be presented to change the Bank Act?


Eugene Whelan: Mr. Speaker, it is not the Bank Act but the Income Tax Act which would require amendment. We think this aspect has some possibilities and it is under serious consideration at the present time.


Herbert Thomas (Bert) Hargrave: Mr. Speaker, may I ask a short question of the minister?


The Acting Speaker (Mr. Ethier):: Again the hon. member may ask his question if there is unanimous consent. Is there unanimous consent?


Some hon. Members:: Agreed.


Herbert Thomas (Bert) Hargrave: My question is with regard to a figure which the minister mentioned. We on this side distinctly heard the figure 30 per cent mentioned with reference to an interest rate. Could the minister clarify that? I am sure we heard the figure 30 per cent.


Eugene Whelan: Madam Speaker, I did use that terminology. I said some people are forecasting that interest rates could go that high. In fact, some economists are forecasting a 30 per cent interest rate.
In the World Food Council we discussed interest rates as they pertain to poorer countries, poorer than Canada; for instance, the Philippines. In some of the South American countries the interest rate is over 30 per cent at the present time. I don't know how countries can produce food under those circumstances. Some Canadian banking institutions are lending money in those areas. I am told that in some parts of Asia interest rates can be well over 50 per cent. We abhor that kind of thing.
I also pointed out that interest rates were not the only bad thing. For example, when you go to world price for energy the impact will be even worse than interest costs. Some people on the other side may be advocating higher energy costs, but people earn $1 a day in places like Tanzania where diesel fuel and gasoline cost $5 a gallon and eggs cost $2.50 a dozen. These are the things we see happening with the high cost of energy and the input costs of agriculture.
Let me tell members from Saskatchewan that the cost of potash has increased over 200 per cent. I know the potash corporation in Saskatchewan last year had an increase in profit of 150 per cent. I guess that is what you call social
Agriculture
democracy. That is the staff of life for many people. Potash fertilizer produces food. Economically millions of people in the world are being starved to death by interest, energy and fertilizer costs.


Mr. Pat Nowlan (Annapolis Valley-Hants):: Mr. Speaker, I want to congratulate the hon. member for Medicine Hat (Mr. Hargrave) for introducing this motion. I have to express my extreme disappointment with the minister because he did not address his mind to the main part of the motion, let alone to the remarks of the hon. member from Medicine Hat which included some very instructive comments and objective thoughts to help the farming community in this country who are faced, in the terms of the motion, with the "deliberate high interest rate policies" of this government. For the first three-quarters of the minister's speech we heard that we may not have increased beef production in Canada to service the American market, but we certainly increased the bull production in Canada which could have more than serviced the United States. A lot of the ministers remarks were not even relevant to the motion.
I like the minister. He is a genial fellow, but he has had his chance to speak. I have only 20 minutes, which is even less time than the minister, but I intend to say a few more relevant things, with respect.
The minister seems to thrive on appellations, but there is one which goes back to storybook fame. It is "Old Thunder". It is lots of noise, lots of thunder but no fire in the old system. This minister with his orations, diversions and camouflage in terms of real problems in the agriculture industry will be known as "Old Big Thunder" or "Soft Thunder". Like summer lightning, he has some flashes in the sky but does not produce any heat.
One of the reasons I am speaking today is because the farm community is faced with high interest rates. We are talking about the farmers of this land. We are not talking today about the small businessman and the pensioner caught in the inflationary spiral. We are not talking about the Denmark hog grower, who is not suffering from 22 and 24 per cent interest rates. We are talking about Canadians.
The minister criticized the hon. member for Medicine Hat by saying: "Oh, well, you always say the same old thing." Of course the farmer, the small businessman and Canadian citizens always say the same old thing. This minister should come down from the clouds and get back into the fields of Canada and deal with Canadians. He will find that the farmer in the east, in the west and in Ontario, where bankruptcy is high, is saying the same old thing, that 23 per cent interest on loans for short-term capital is too high to be able to run a productive farm.
The rate of bankruptcies, which were not even heard of in earlier days, is now very high. As the minister said, last year 222 farms went out of production and already in the first quarter of this year there were 93. Those are farms that are

June 1, 1981
Agriculture
out of production and will not come back into production for some time.
In Nova Scotia there is a farm loan board which provides substantial short-term help to farmers caught in this squeeze. Therefore, we do not have at the present time this horrendous bankruptcy situation. In Ontario, which used to be the heartland of Canada, I know of two cases where the farmers just walked off the land. They could not afford to pay 22 per cent on short-term money. They could not do what the hon. member for Medicine Hat suggested in terms of reducing in an immediate way farm credit procedures in order to get short-term help.
Of course people are saying the same old thing. They will continue to say the same old thing as long as this government sits on its derriere and tries to camouflage the fact that the farm community is faced with insurmountable problems as a result of interest rates that have never been so high.
I have no sympathy for the minister today, who outside the House is a genial fellow. I have no sympathy for the fact that he had to fly for 24 hours in order to get back here to participate in this debate. If the debate has done nothing else, it has at least brought the minister back to Canada to talk about Canadian problems and deal with the thoroughly irate farming community from coast to coast.
The Toronto Star, that pillar of journalism which is the masthead of the Liberal party, says day in and day out that the interest rate policy of this government is folly. The Canadian Federation of Agriculture has asked for short-term help to the tune of $200 million to assist farmers to renegotiate loans or who are caught in a mortgage vise. They want help now, not down the road.
We cannot accept the policy of gradualism of the Minister of Finance (Mr. MacEachen). It will lead us right into the financial sink and down the tube if we follow that minister who does not bring in any policy. The Minister of Agriculture is monitoring the problems. All you have to do is look at the farm digest and farm papers to know that the farm community is in dire straits. Obviously some parts are stronger and healthier than others.
This minister comes back, moans and groans, rubs his tired eyes and talks about the sacrifice he made by travelling 24 hours to be here in the House of Commons to talk about something that is basic and important to every Canadian from coast to coast. That is the problem of the farm community having the productive capacity to produce food for all Canadians. Instead of talking about our potential to expand, all we received from him this afternoon was claptrap.
Every farmer in this country has sacrificed more than the Minister of Agriculture in trying to meet unconscionable interest rates. I hope they were watching television today to see the Minister of Agriculture try and camouflage the real problems. He did not even address the motion of the hon. member for Medicine Hat. It is not a highly provocative, partisan motion.
The speech by the hon. member for Medicine Hat was most even and objective. That member, a past president of the Canadian Cattlemen's Association, is one of the most respected members of the farm community of this country and was so long before he became a member. We are thankful he is now a member so that he can bring to the floor of this House some of the concerns of the farm community, let alone his special knowledge and interest in the cattlemen of this country. I am glad the minister was in this House to hear some of the hon. member's positive proposals. However, the minister did not even address them. The motion reads:
That this House condemns the government for its failure to help alleviate the harsh and harmful effects on Canadian agriculture of its deliberate high interest rate policies, for its failure to honour its responsibilities to the Canadian agriculture industry during the present time of economic crisis, and for its failure to take other positive steps to assist the Canadian agriculture industry such as:
1)	extending the small business development bond to unincorporated farmers;-
The hon. member for Medicine Hat referred to a letter in the paper which indicates that the minister may be moving after he monitors a little more. The motion continues:
2)	amending the Farm Credit Corporation Act, the Agricultural Stabilization Act, and the capital gains tax to ensure that Canadian farmers have access to necessary and sufficient funding; and
3)	redirecting its spending priorities to positive agricultural programs which would benefit Canadians as a whole.
That is a fairly even motion in view of the crisis facing Canadian agriculture today. The Science Council of Canada stated that if we develop our potential in agriculture, we can double our production by the year 2000. We must redirect some of our interests, energies and priorities into the farming community. However, all we got today was the same old camouflage evasion from "Old Thunder", except for the very last part of his speech.
I am glad the hon. member for Medicine Hat asked about the 30 per cent interest rate. From listening to the minister, 1 thought he was relating to what people were saying was going to happen in Canada, not in the Philippines or Chile. In any event, the minister clarified that in part. Let us hope there will be no more talk about 30 per cent interest rates. The 20 and 22 per cent interest rates are too high for the farmer to pay.
The minister complained that we are saying the same old thing. Interest rates have been going up on a monthly basis with a few little blimps downward every so often. However, the farmer is locked into a year contract or demand note, and a longer contract if it is a mortgage. Co-ops do not change that quickly. The farmer cannot readjust his planning to conform with these unconscionable interest rates. That is the fundamental problem affecting the farm community across the country.
I was going to compliment the minister before I listened to his oration. There are areas where we can move very positively in agriculture and where we can redirect expenditure and produce more. The hon. member for Medicine Hat talked about an averaging indexing proposal. The minister did not reply to that. It seemed sensible and logical. In good years the farmers could salt some away and use it in poor years. Because
June 1, 1981

the minister did not reply to that, I am a little hesitant to compliment him.
Two weeks from today the minister and I will be at the official opening of the research station at Kentville, in Annapolis Valley in my constituency. That agricultural research station is for all of Atlantic Canada. There is no area of agriculture in this country where there is more potential than in research and development. 1 am certainly glad that we are going finally to have the official opening of this research station.
I could cite chapter and verse some of the problems there are now. I am sure the minister is aware of them. Unless we plan now for the future, some of the smaller markets in terms of dollars will be lost to Atlantic Canada. We are not like the big people from the west and we do not have the wealth of Ontario. Our low-bush blueberries in Atlantic Canada account for something like $18 million to a lot of farmers who need that income, yet right now, because of developments in high-bush blueberries in Michigan, New Jersey and the Carolinas in the United States, we in Canada are becoming very uncompetitive. Unless research is done now in terms of more mechanical means of harvesting blueberries to cut down on high labour costs and in terms of pruning these bushes rather than burning them with high cost oil and things like that, we will lose these specific benefits in Atlantic Canada from this industry. Obviously, they are very small, at the start, but when you count up all those blueberries and you find you lose $18 million, you realize that this is something very valuable to many farmers in Atlantic Canada.
I see that my time is almost up, but I was bothered by the minister's remarks today. I would have respected him even more had he come in and said he knows there are a heck of a lot of problems in the agricultural industry. Anyone who is confronted with these interest rates, whether he is a businessman or a millionaire, particularly farmers with crops that have to be planned on a seasonal basis, is obviously facing tough times.
I compliment the hon. member for Medicine Hat for bringing forward this motion. Those are my points about the small business development bond program and some of the proposals by the hon. member. I would really have appreciated the minister giving a considered reply to the speech by the hon. member for Medicine Hat, or at least responded to his motion, rather than giving us utter garbage for the first three quarters of his speech.
The minister knows more about this industry than his remarks indicate. From time to time I believe he really does have a sincere interest in agriculture. But I think my appellation of "Old Thunder", "Big Thunder", or whatever you want, is unfortunately too accurate. While the minister may have, and does have when he is not so tired, a sincere interest in agriculture, I am afraid that often the sound he makes in cabinet does not provide results. That is certainly the case with the sound he makes outside, but how much weight he carries in
Agriculture
cabinet councils I am not sure. With his interest in agriculture he knows better than I that more research and development with a shift into higher spending has to be accomplished if we in Canada are to stay competitive in many areas.
There are many problems facing agriculture now in Atlantic Canada. Somebody earlier referred to GATT. Let me talk about research and development. We are at a lower level in Canada in terms of research and development than the United States and Russia. I have read several interesting articles on this subject and I intended to quote from one at quite some length. The agricultural reporter from Alberta, Mr. Schmidt, reports in a very interesting way on the comparison between the United States, Canada and Russia in terms of expenditures for research and development. Canada is at the bottom of the list. I understand that the minister's officials and Science Canada suggest that a dollar spent on research will in effect produce $7 in return.
I know the minister has been pretty busy and may not have had a chance to digest the traditional annual brief from the Agricultural Institute of Canada, but I hope his officials have considered it. It was presented to all the party caucuses in the Parliament of Canada, the government, Conservatives and the NDP. On page 1 of the brief there is a most interesting section on research and development which shows, in effect, the returns you get when you really spend money on research and development. Some of these facts apply very much in my riding because of the enhancement and development of the broiler industry. On page 2 of the brief, among other things, appears the following:
The benefits accruing from agricultural research have been well documented. The safeguarding of wheat from the ravages of rust provided a benefit to cost ratio of 482:1; research leading to the reduction of fallow acreage in Manitoba provided a benefit to cost ratio of 278:1 but the benefit should continue to accrue for decades ahead; a benefit to cost ratio of 260:1 was estimated for R and D on chicken broilers; in Ontario input cost of $32 million for the improvement of corn provided additional returns of $2.6 billion or an investment return of 80:1.
I think my time has just about run out, but the second short paragraph on this page shows the Canadian picture in relation to that of the United States. It states:
Ten years ago (1970), the Canada Department of Agriculture expenditure was 3.7 per cent of total Canadian Government expenditure. By 1978, agriculture expenditure had dropped to 2.4 per cent of total government expenditure and in 1979, agriculture expenditure was reduced still further to only 1.9 per cent of total government expenditure. Of this, only 10.9 per cent was expended on agricultural research.
There were many proposals and positive recommendations, many of which have been made before. Frankly, I think Socrates said a long time ago that there has not been a new philosophic or perhaps agricultural thought that has never been advanced before by man. These ideas are framed in different ways. A lot of these things have been said before. There is a problem in terms of research and development. Anyone can play with figures, including politicians, farmers and certainly financiers. If we are to plan for the future and look down the road ten years-and it often takes that long to do the work and see the results-instead of a declining budget for research and development within the agricultural budget we must have lead money and lead time. We must have a

June 1, 1981
Agriculture
surplus of funds for research and development in agriculture. If we are to have the same budget, let alone a declining budget, the inflationary factor will mean we will be spending all the money and time on research and development just to maintain the status quo or to plug the holes in the proverbial dike wall of research and development, with no plans for new holes in that wall down the road. We must spend more money in order to develop better apple, potato, wheat, soft wheat and hard wheat crops, you name it, to say nothing of the low-bush blueberry crop that must be competitive so we do not lose our markets.
I do not want to trespass on time as I know other hon. members want to speak. We should perhaps have two days' debate on this subject, one for western agriculture and one for eastern agriculture. There are very real problems and I know the minister is aware of these. I certainly hope his officials are aware of problems in relation to the GATT negotiations and the potentially adverse effects of valuation procedures and freight rates in border states. If we are not careful we may be in greater difficulty because of valuation procedures and freight rates for imports. Valuation is supposed to be neutral and freight rates are supposed to be taken into account, but in terms of Canadian markets and producing areas adjacent to border states we could find ourselves in the position of having a real flood of imports.
There are many things one could talk about in the field of agriculture. 1 could even refer to the veterinary college in Atlantic Canada, the matter of feed grains in eastern Canada, the effect of marketing boards on price stability and production, and interest rates to consumers. There is so much to be said about agriculture, but I think the bottom line of my concluding remarks about agriculture is that I just wish that "Old Big Thunder" would not thunder so much from time to time-


The Acting Speaker (Mr. Ethier):: Order, please.
[ Translation]


Mr. Marcel Ostiguy (Parliamentary Secretary to Minister of Agriculture):: Mr. Speaker, I too would like to comment very briefly on today's opposition motion concerning interest rates. Mr. Speaker, I listened to the speeches of two opposition members, the hon. member for Medicine Hat (Mr. Hargrave) and the hon. member for Annapolis Valley-Hants (Mr. Nowlan), but neither of them came up with constructive suggestions. They criticized the 10 per cent segment of agriculture which may be in the doldrums, but they forgot to point out that 90 per cent of Canada's agricultural community is operating at full capacity.
Mr. Speaker, it is a fact that Agriculture Canada and the minister are aware of the problems caused by recent hikes in interest rates, particularly to young farmers who are just starting out in the agricultural business and to a few specialized producers involved in hog and beef production. Naturally,
one cannot remain indifferent in the face of bankruptcy reports, as the minister said earlier, because in certain areas the bankruptcy rate is as much as 70 per cent higher than at the same time last year. Still, although interest rates do create serious problems for all farmers, the number of bankruptcies in Canada has always been very low. As I recall, a few moments ago the minister gave us a few statistics to show that last year 222 farm operations went bankrupt as compared with over 7,000 small businesses. Of course there are fewer bankruptcies in agriculture than in any other field. However, in most instances we are not in a position to find on our own the corrective measures to problems whose scope extends far beyond the jurisdiction of the Department of Agriculture. In the field which concerns us, namely assistance to farmers, the existing programs coupled with certain measures which have already been taken by our department contribute to lighten the farmers' financial plight.
Last week, when regional development deputy minister Couillard appeared before the Standing Committee on Agriculture, I heard opposition members belittling the new reorganization in the Department of Agriculture. And yet that reorganization was carried out to meet the needs of farmers and enable them to improve their efficiency and their productivity. It follows that when they raise their productivity they can lower their production costs. Throughout the debate, during an hour and a half last week, they harassed the deputy minister before the Standing Committee on Agriculture, telling him they did not understand why the Department of Agriculture has made changes within that service. Yet it was quite simple, and today members opposite blame the Department of Agriculture for doing nothing. It was precisely measures like those taken by the Department of Regional Economic Expansion that allow farmers to improve their production.
Of course, Mr. Speaker, as a result of recent increases, interest rates of chartered banks in Canada have reached almost 20 per cent. While everybody is clearly affected by those increases, farmers are especially hard hit, because they need short-term and long-term loans to purchase inputs such as the machinery, the seed, the fertilizers, etc. required for their annual production and to improve their operations. A while ago, the Minister of Agriculture pointed out rightly that some products such as chemical fertilizers from Alberta had increased by 200 per cent, that potash products had substantially increased. We did not hear the members opposite, especially those from Alberta, refer to such increases. Pork producers, of course, like all those whose prices are not controlled by marketing boards, are especially affected by rising interest rates. If we compare them with dairy producers who have a National Marketing Board, quotas throughtout the country and indexed increases for industrial milk and fluid milk.
In my own constituency of St. Hyacinthe, there are a lot of farmers in just about every type of production. I can assure you that the dairy producers are not complaining because they
June 1, 1981

come under a marketing board. There are of course many farmers in my region who are pork producers. Since there was no pork marketing board until quite recently, when the Quebec producers voted for a board about four to six weeks ago, these producers have known fluctuating prices and they have certainly overproduced, which has brought about a fall in prices. Of course, decreasing prices and increasing interest rates do not help this industry. Not only must the farmers obtain bank loans at rates between 18 and 20 per cent to maintain costly operations and improve their buildings and equipment, but market prices are too low to allow them to get a sufficient income from their product. As I have just explained, Mr. Speaker, marketing boards make all the difference.
It is a known fact that, at the present time, financing costs represent approximately 15 per cent and can even reach up to 30 per cent of operating costs. However, the situation is perhaps of greater concern for young farmers and new operators who have to bear the costs of big mortgages in addition to the burden of those costly productions. These young farmers who want to make a start on our Canadian farms are the backbone of our farming sector and they are often forced to give up without any hope of being able to reintegrate the farming sector on the short term. We know, Mr. Speaker, that a disproportionate number of pork producers are now defaulting on their farm loans. The minister met recently with the Association of Bankers. We shall be meeting the association again this week.
I have personally met several bankers in Quebec. We are simply asking them to be a bit more indulgent toward hog producers. Several small processors also have problems because they have to support very large stocks from one crop to the next at current interest rates. Last year, farmers paid $1.5 billion in interests, and this figure will probably reach $2 billion this year. I am speaking about what action we intend to take, I have just mentioned that there have been meetings with The Canadian Bankers' Association. The Minister met them at the end of April and we shall be meeting them again this week. The Minister has pointed out that the banks and the government have a shared responsibility to consider the long-term interests of Canadian agriculture and our society as a whole during economically difficult periods.
The Minister has asked the bankers to consider refinancing agricultural loans now due over a longer period. I believe that it would be physically possible for the banks to do so to help the farmers who are now going through a difficult period, like all the other industrial sectors. As a result of this meeting, the association agreed to recommend a more flexible policy for the management of agricultural loans to its members, to the bank branches, in view of the high interest rates. The association has agreed to discuss with its members the possibility of paying particular attention to those who are facing real problems, such as pork and beef producers. The farmers have just completed their sowing, and they have had to invest large amounts of money in fertilizers and seeds. And considering the current low prices in the pork industry, it is my feeling and my
Agriculture
conviction that the banking system will act on the request made by the minister just recently.
Of course, borrowers from the Farm Credit Corporation pay much lower interest rates than other borrowers. On April 1, 1981, the rate was set at 14 per cent. I would like to point out to opposition members that this is only 2 per cent more than last year, when they were the government, and this indeed was more than a year ago because they had raised the Farm Credit Corporation's rate to 12 per cent. And since that time, we have raised it to 14 per cent, which is only 2 per cent more charged on loans from that corporation.
The flexible repayment facilities offered by the Corporation are based on the nature of the borrowers' farm production and last year, when pork producers faced difficulties, each case received special attention and was dealt with fairly. There have been time extensions to repay farm loans. Four thousand Five hundred long-term loans were granted in 1980-1981. Currently, the government is seeking as a priority a way of making more funds available to the corporation. As stated earlier by the minister, if the various pieces of legislation on the Order Paper can proceed-and there are now five or six in the name of the Minister of Agriculture-we will be in a position, hopefully within a reasonable time frame, to amend the Farm Credit Corporation Act so that farmers may obtain bigger loans. It must be kept in mind that both in Ontario and in Quebec farmland worth $500 per acre hardly 15 years ago is now worth $1,500 and $2,000 per acre. And as far as I am concerned, I can say that the family farm, my father's 100 acres, was sold for $1,500 an acre in 1960, and on resale just a month ago, it brought $2,000 an acre, which clearly shows the high increase in farm prices. What this means, Mr. Speaker, is that although the farmer must face high increases in interest rates like all other industries, his farm property has increased in value. The example I have just given is very typical.
' Farm improvement loans granted between January 1, 1980, and March 31, 1981, totalled over $49 million. The maximum interest rate charged cannot exceed the chartered bank prime rate by more than 1 per cent. In addition, over the weekend I met people involved in the selling of farm equipment, seed grain and other input supplies. All of them told me that in recent months they have had at least a 20 to 25 per cent increase in sales. In connection with the hog stabilization program which is intended to help producers, the minister recently announced stabilization payments of $8.96 per head marketed between April 1, 1980, and March 31, 1981. This means that the total cost of the program could reach or even exceed $100 million. That, Mr. Speaker, is yet another move by the Department of Agriculture and the Canadian government to help out the farmers in Canada. I can say that in the province of Quebec which accounts for 38 to 40 per cent of all of Canada's hog production, approximately $40 million will be spent to help Quebec hog producers.
There have also been improvements with a view to processing applications more quickly and we have so advised the

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Agriculture
organizations with whom we have met recently. I was accompanied by a group of hon. members at that meeting with representatives of the UPA, the Cooperative federee and the Association des meuniers. We promised them that all correctly filled forms would be given special attention and that within four to five weeks of their being received farmers, precisely because of those high rates of interest, would receive their hog stabilization payments. The Agricultural Stabilization Board and the Department of Agriculture have introduced these stabilization payments in order to provide Canadian producers with fair and average support and income.
Agriculture Canada and the federal government have established many other programs designed to help producers increase their production and avoid disaster in periods of hardships such as the one we are now experiencing. For instance, there are the research programs. Over $155 million of the over-all departmental budget have been earmarked for research. In the riding represented by the hon. member for Annapolis Valley-Hants (Mr. Nowlan) a new research centre is soon to be opened. Earlier, the hon. member spoke of Canada's fourth veterinary college. One has to understand the reasons why this college is not yet under construction. There are four provinces each striving to get it. Once they are agreed about a site, Agriculture Canada will assuredly abide by the recommendations of the Howell report submitted over two years ago.
The crop insurance program is a cost-sharing program where federal and provincial governments each contribute 50 per cent. The bill setting up Canagrex, an agency specifically entrusted with exploring for new markets, will soon be introduced and will hopefully be supported by the opposition. Only last week, I replied to a question put by the hon. member for Beauce (Mr. Caron) concerning maple syrup overproduction in that area. It is in instances such as these, Mr. Speaker, that Canagrex, which is to be responsible to the Department of Agriculture, will be involved in finding new offshore markets. This could work for maple syrup as well as pork, eggs, chicken, beef, or cheese. We know that Canadian producers are increasing their production considerably each year, which means that there is overproduction in many areas. As far as food supplies are concerned Canada is definitely not an importing but an exporting country. We need an agency like Canagrex, which the Minister of Agriculture (Mr. Whelan) wants to set up, to help our producers.
We also have programs for drought-stricken ranchers. I would say that Agriculture Canada did everything possible last summer to help those western farmers who were severely affected by the drought. As far as stabilization payments are concerned, I just referred to them in connection with hog producers. We have had them for hog and potato producers and we will probably have them for apple growers. The Agricultural Stabilization Act provides for nine areas of production where, whenever the market price does not match production costs the Agricultural Stabilization Board steps in, which means of course the Department of Agriculture. As the Minister of Agriculture mentioned earlier, over $3 million
were paid out to Canadian producers since the legislation was enacted.
Bill C-46, to regulate the importation of meat, that the Standing Committee on Agriculture will start considering tomorrow, is another major piece of legislation designed to help Canadian farmers. I hope members opposite will make sure it is adopted without delay. Bills C-32 and C-33 as well as several other bills now on the order paper are all pieces of legislation put forward by Agriculture Canada and the Canadian government to improve farm products. I should like to deal now with the Feed Freight Assistance Program of the Canadian Livestock Feed Board. When the chairman of the Canadian Livestock Feed Board appeared before the standing committee a few weeks ago, members of the opposition dared say to him: "You should call it the Eastern Canada Livestock Feed Board."
It is not with such remarks that we are going to help our farmers, Mr. Speaker. I suggest that our hon. friends should reconsider their position from time to time. To conclude, Mr. Speaker, we do not intend to take extraordinary steps just now. Our agricultural industry is sound and the changes already made to existing programs should adequately help Canadian farmers through this critical period. This situation is very likely to be temporary; should it persist, however, we would then consider more drastic measures. We deplore the problems now facing Canadian farmers, but we feel that we should not be the only ones to help them. The provincial governments should do their share too. Agriculture Canada is aware of its responsibilities and we intend to prove it.


The Acting Speaker (Mr. Ethier):: Order, please! I regret to interrupt the hon. member, but the time allotted to him is up.


Mr. G. M. Gurbin (Bruce-Grey):: Mr. Speaker, I think one of the most frustrating situations is to have to sit and listen to a member such as the Parliamentary Secretary to the Minister of Agriculture (Mr. Ostiguy) discuss some of the government's measures in a relatively nonchalant-I will not say an uncaring-way, an unfeeling way for a whole sector of our economy, which is in a great deal of difficulty right now. Indeed, it is in a crisis situation today.
Before the parliamentary secretary leaves I would like to address a specific point which he mentioned. I think the frustration I feel must be shared by the agricultural community across this country. I know that he will agree with me when I say that there is a large segment of the agricultural economy right now which is in big trouble-if he will admit that. One thing which must happen is that there must be a federal-provincial understanding of the problem. He is proud of the record he has. He says that it is the provincial governments which must come to the assistance of the farmers. The provincial government of Ontario came to the assistance of the hog producers just last week with a $10 million subsidy. Do you know what the federal Minister of Agriculture (Mr. Whelan) did? He said that the $10 million would be taken off
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the stabilization program. That is the kind of co-operation we receive from the federal minister at a time when the province is trying to provide some assistance to the industry. I guess that is the kind of response we can expect to receive from the minister if the attitude of members opposite remains the same.
First, I do not feel the government has identified the problem.


Marcel Ostiguy: It is fair for everybody.


Gary Michael Gurbin: June 1, 1981
Agriculture
because it seems to me that that should be one of their first concerns, not to look outside the country when we have a situation where-


The Acting Speaker (Mr. Ethier):: Order, please. It being six o'clock, I do now leave the chair until eight o'clock p.m.
At 6 p.m. the Elouse took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
Gary Michael Gurbin: Mr. Speaker, before the dinner adjournment I was trying to identify one of the major difficulties of the government in dealing with this problem. The simple fact is that there is a lack of understanding of the difficulties involved in the basic farm production unit simply because research, the complete orientation toward marketing and the whole agribusiness are devoted to looking at international events and at things which are happening in other countries. At the same time, we do not have in place any specific way of determining what is happening to an individual farm unit.
I certainly hope that as we start this debate again, the fact that there are so few hon. members present on the opposite side is no indication of the sincerity of the government on this issue. I think that the few who are now present are really part of the problem. We will not resolve the difficulty until they start to face the situation and appreciate that it is truly a crisis, not something which is going to go away as long as they do not react too strongly in one way or another. 1 want to assure them that this is a real crisis. The situation is very real. At the local level, the basic farm unit, particularly the beef and pork production sectors, is in severe difficulty today.
If we look back a little, we find that in 1941 there where 3.2 million farmers in this country. That is an indication of what is happening in the agricultural sector. There has been a gradual decrease in the number of farmers. Each year in Ontario alone there are 1,000 fewer farmers. This will result in a reduction of the basic farm unit. Even though individual farms are becoming more productive, we are seeing the concentration of the agribusiness in the hands of fewer and fewer, to a point where I think we must decide whether we are going to maintain this very economical and important basic unit which has given Canada what is really a very cheap source of food. Unless attention is paid to that factor, we are all going to suffer significantly in the end.
Another point that I would like to make is that these are people who are probably friends and neighbours of some of the hon. members opposite, people who probably voted for their party as well as ours, and people who may have even voted for the NDP party. However, the fact is that all of these people
now find themselves in situations similar to the farmer who spoke to me yesterday for about an hour. He had been in the business for ten to 12 years, had built up his whole herd and put together a farming operation including machinery and significant land holdings. He came to a situation where he had to sell his basic farm unit to a foreign buyer. He must now find some way of recovering his financial losses and regaining a sound economic basis. He was a good manager. This is a farmer who knew the business, who had grown up on a farm and who understood agriculture. Through no fault of his own, he had to accept the prices which were being offered for his commodity over the past two or three years. Eventually he found himself in a position where he had to decrease his total production significantly. Lately this has happened to many people.
A number of things have taken place. One of the most significant groups to offer proposals for solving the problem is the Canadian Cattlemen's Association which has identified the difficulties in the beef sector. It has mentioned high interest rate costs, the inflationary increases in a lot of farm input costs, high energy costs, the importation of live fat cattle from the United States, and the difficulties experienced in 1976 when there was no import law. All of these things are balanced by the fact that farmers still have to accept poor prices for their commodity at the farm gate. They cannot see any way of recovering those losses in the reasonably near future. A number of factors are involved in that but I shall not dwell on them now.
What this amounts to in concrete terms is that in my constituency alone, the area of Bruce-Grey, this year the cost to beef producers will be $20 million. That represents the subsidy that those farmers are giving to the consumers of Canada. It is the cost to that one segment of the agricultural industry, and I think that is going to spell gloom for the whole industry, particularly in Ontario.
The Ontario Federation of Agriculture has made some specific proposals regarding interest rates and in conjunction with these, the Conservative party has made several significant proposals as well. These have been put before the House on other occasions and I am sure the Minister of Agriculture is aware of them. They deal with things like the Farm Credit Corporation and the possibility of increasing its funding by perhaps $150 million or perhaps reconsidering the interest rate it is charging now of 14 per cent instead of the 10 per cent it was years ago.
We are also considering whether the Farm Credit Corporation would be able to provide access to funds from regular banking or lending institutions which could be of more advantage to the farming industry. In addition, we are examining the stabilization program to see if improvements can be made to it so that the return to the farmer could be increased to the point of enabling him to survive. We are also examining relationships between the federal and provincial governments. Some provincial governments have offered to set up review


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agencies to deal with farmers who are in distress. Perhaps a mechanism could be set up to review specific cases of farmers in trouble and to find ways to assist them. This would be a valuable contribution by both the federal and provincial governments.
At the moment there is an offer from this side of the House, which I believe has the support of the New Democratic Party, regarding the small business development bond. In this House this afternoon we heard the Minister of State for Small Businesses (Mr. Lapointe) speak about a program to let people know what the bond is all about. That is fine, but perhaps it should have been done a year ago. What we need now is an improvement in this bonding mechanism so that it can be used by unincorporated small businesses and farmers for operating capital and inventory. Perhaps it could be extended beyond this year. Those things could be done now and we on this side have offered to have a one-day extended debate. I think the government should accept the offer.
In 1980 the Minister of Agriculture promised that he would do something for the farming community, but that promise has not been kept. I think that the will to do something is there, on the part of some hon. members opposite at least. Unless action is taken now, we know that by the fall of this year the number of farmers in trouble will not just have doubled or tripled but will have increased by five or ten times. There will be an increasing number of farms for sale and the entire agricultural economy will be on the verge of collapse. In the end, not only the farmers but consumers will suffer because of the lack of a constant and secure source of reasonably priced food.


Mr. Garnet M. Bloomfield (London-Middlesex):: Mr. Speaker, I should like to speak for a few moments tonight on the role of agricultural research in the Canadian economy. The attainment of the present success of the Canadian agrifood sector, developed under many natural disadvantages, has depended upon an expanding base of research and technology. The Canadian agrifood system is, I suggest, basically sound both technically and economically. During the post-war period productivity increased to almost double that of the other non-agricultural sectors. The system provides more than the equivalent of Canadian food requirements, and export sales amounted to about $8.0 billion in 1980 plus $95.0 million worth of food which was made available to the world food program. The system supplies Canadian consumers with adequate, high quality food at a cost of 17.8 per cent of consumers' disposable incomes, which is close to the lowest percentage of any country in the world.
Agriculture Canada, under the leadership of this government, has continued to develop strong mission-oriented, agricultural research and development programs which are making important contributions to crop and livestock improvement, to the efficient utilization of Canada's agricultural resources, and to market development. Such programs are accomplished through close federal-provincial co-operation, particularly in technology transfer, and are committed to the following specific areas of research and development.
Agriculture
Basic research is a prerequisite to achieving advances. Our programs in a number of promising areas, such as nitrogen fixation, genetic engineering, somatic hybridization, and cryo-preservation are progressing and have provided some interesting practical results. The opportunities offered by biotechnology and especially its impact on the food processing industry, are currently being investigated.
Because of climatic and soil limitations, the improvement of crop production is particularly critical in Canada and a number of major programs are committed to this effort. Hardier varieties, better adapted to short, cool seasons, higher yielding capacity and of better quality are being produced. Resistance to crop pests is also important. This year alone, 46 new varieties have been licensed for every major crop and area of this country.
Columbus, a new hard red spring wheat variety developed at Winnipeg, will make a major contribution. It is the first wheat variety to possess resistance to sprouting and weathering. These characteristics will make it suitable for export even in bad years when other wheats would be downgraded to a level of food grain, meaning a significant difference in income for the producers.
Gordon, a new soft white winter wheat for Ontario, was licensed in 1980. It represents a yield improvement of close to 7 per cent over Frederick and combines better winter survival and pastry quality. Columbus and Gordon then, are two major achievements in wheat breeding.
There has been progress in the breeding and improvement of other crops also. Eight new com hybrids were released. Grain corn has become a major crop in Ontario because of research which has produced better adapted hybrids and better cultural practices. Through research, corn, basically a warm-climate crop, has been grown in more and more northern latitudes and is now an important crop for Quebec, Manitoba, some parts of Alberta and the maritime provinces.
The soybean crop is one that could not have been grown in Canada to extent without research. Again, the production of a warm climate crop has been expanded because of better varieties and better cultural practices developed by the research branch of Agriculture Canada over the years. This year, Nattawa, a new variety of soybean in the intermediate maturity group, which matures up to five days earlier and yields about 10 per cent more than a standard variety, has been licensed.
Perhaps the greatest success in Canadian agricultural research is that of rapeseed. Rapeseed is an oilseed crop presently grown on more than two million hectares in Canada. It used to be grown on very limited acreage to produce a lubricating oil. Because of research it is now used to produce an edible oil and a protein supplement feed for livestock. It accounts for 40 per cent of the vegetable oil consumer in Canada.
Originally all the rapeseed varieties contained high levels of toxic materials that prevented their use in human and animal

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Agriculture
nutrition. Through research, the level of these toxic materials was dramatically lowered and rapeseed became suitable for use in food and feed. A new crop and a new industry have been introduced in Canada. Edible rapeseed oil is now known as canola oil. Canola oil is used domestically and is also exported, thus improving our balance of payments.
The research bureau has been the leader in rapeseed research and has collaborated closely with universities and the industry to make rapeseed a success story. Tobin, a new canola variety, is the latest variety developed by the research bureau of Agriculture Canada. It will be licensed shortly.
In 1980 the potato breeding program at the Fredericton research station was strengthened by the addition of five professional person-years because Agriculture Canada wants Canadian potato producers to take advantage of market opportunities. I am sure the member for Chicoutimi (Mr. Dionne) will be interested in that. Two new potato varieties were released in 1980.
With respect to animal production, research in progress on animal production will provide the basis for additional farm and processor incomes. Animal disease and insect control and improved feed efficiency are examples of practical problems which research has contributed to alleviating.
The foreign cattle breed evaluation program has produced interesting results in the search for faster growing, better adapted and more feed efficient beef cattle. An eight-year study demonstrated that the Hereford can be crossed with the Highland cow exceeded either parent breed in calf performance and cow productivity and proved to be an excellent range cow. Knowing there are 20 million hectares of range land in Canada, this new crossbred cow can make a significant contribution to beef production in Canada.
Land and water resource are the two natural resources on which agriculture depends. Because the food production capability of Canada's vast land mass varies so greatly, multidisciplinary teams of experts collaborate to provide information on how to make the best use of our land and how to improve its productivity. Thanks to the efforts of research branch scientists, we now grow crops on land that was part of the dust bowl of the "dirty thirties".
Water is vital to crop and animal production. In western Canada, research on the irrigation of drylands has led to increased productivity and economics in water consumption as well as to reduced salinity problems. In the east, research on soil drainage problems has permitted earlier planting and expansion of production into areas normally too wet for many crops. Plant and animal wastes are potential water polluters, but continuing research has provided practical solutions to the problem and led to the development of effective systems of waste disposal and utilization.
Energy conservation is a major concern of the research branch. Engineering research in this area covers a wide range from farm building insulation and temperature control, frequency and depth of tillage, irrigation practices and the production of fuel from animal or crop wastes. Other energy-oriented programs and biological research on the trapping of solar energy by plant and on the processes by which some plants convert nitrogen from the air into ammonia to nourish the plant. This research could result in earlier maturing plants and in savings in chemical fertilizer use.
With regard to food processing, its distribution and retailing, we find that challenging areas for research are ingredient technology, enzymology and fermentation, single cell protein, improved efficiency and waste utilization. In the area of food processing, research is directed at improving efficiency and at conserving energy. A new blancher which was scaled up from a pilot prototype developed at Kemptville, an Agriculture Canada research station, has been tested by industry. The potential energy saving is in the order of $100 per ton of processed product, a significant contribution of research to industry. Still in the food processing section, a vacuum essence concentration system designed at Summerland by Agriculture Canada has been sold on the international market. Technology transfer of a rapid continuous process for manufacturing candied fruit has resulted in the installation of a new processing line with annual capacity of 3.4 million kilograms of finished product in British Columbia. Research in the food processing sector is done in co-operation with and for industry, and it pays off.
In the area of international programs, Agriculture Canada continues to increase its contributions to international agricultural research. Being the major Canadian source of agrifood scientific, professional and technical expertise, Agriculture Canada plays an essential supportive role to the Canadian International Development Agency's activities. Canada's involvement is linked to the expectation that, in the long run, it will lead to mutually beneficial commercial relationships. Third world trade from such countries as Algeria, Nigeria, Mexico, Brazil, and others, which are giving top priority to the development of their agrifood sector, represent a medium and long-term opportunity for significant growth in Canadian sales of agricultural food and agricultural technology. Aid can promote this growth directly by the provision of Canadian goods and services which may lead to follow-up orders, and indirectly by making recipients more aware of Canadian agricultural capabilities. The expertise, knowledge and technology that Canadian scientists provide in developing countries has been developed in Canada for the use and benefit of Canadian producers and in support of Canadian industry. This excellence is recognized and used by other nations of the world.
Examples of aid programs staffed by the research bureau include wheat production in Tanzania; cereal breeding in Zambia; wheat breeding in Brazil; and fruit processing in Columbia. The India dryland project, for example, has been considered as an outstanding effort of which all Canadians should be proud.
I bring these examples of international aid programs to the attention of hon. members of this House to prove the excellence of the work of the research branch of Agriculture Canada. The expertise, knowledge and technology that
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Canadian scientists provide in developing countries has been developed in Canada for the use and benefit of Canadian producers and in support of Canadian industry. This excellence is recognized and used by other nations of the world.
In closing may I say that research has contributed to the development of a strong agrifood industry in Canada. The research bureau is organized to solve current and anticipated agricultural production problems in all regions of Canada. Having qualified professional and technical staff available at short notice proves an immeasurable value in times of emergency, be it caused by a new pest or a drought.
Last year's drought for example did not cause a major disaster, even though it did cause severe problems in some areas. New tillage methods, soil conservation practices, hardier plant varieties, more experience as to which crops to plant under varying soil and climatic conditions contributed to successful farming that would have been impossible in the past. The research branch personnel compiled, and published within a few weeks, information on livestock feeding under drought conditions. Soil moisture conditions on the prairies are monitored throughout the year and advice is given on moisture reserves under stubble and fallow by crop districts as additional information in support of farmers' decisions on farming operations.
Agriculture Canada must continue to play a lead role in research and must ensure that research helps farmers in the long run through difficult times in the future.


Mr. Fred King (Okanagan-Similkameen):: Mr. Speaker, on previous occasions I may have brought to the attention of the House that the hon. Minister of Agriculture (Mr. Whelan) and I have appeared at various farm group banquets, the minister to bring the straight word, as written from Ottawa, and I to provide the comic relief. I think it somewhat ironic that our role should be reversed today.


Eugene Whelan: You have your right to your opinion.


Frederick John King: One learns a few things just by being in this House and observing the events of the day. For example, I learned on Friday from the hon. member for Edmonton North (Mr. Paproski) that members do not offer personal greetings to family and friends from the floor of the House. I am particularly sorry because my son Gordon is in the gallery and my father Billy will this month celebrate his ninety-second birthday, a rather noteworthy occasion. It is good clean farm living that has kept him so long.
I also learned in my brief time here that 20 minutes is never as long as one anticipates. It therefore happens that much of importance that members would say is left in speech notes because time runs out. It is my intention to first list some of the positive things which this government could do for agriculture so that this government and this minister, who is so attentive to opinions of members of this House, particularly opposition members, will benefit and the nation will benefit from the advice and the direction which I offer.
Agriculture
Some government actions which are essential to both the short-term and long-term health of the agricultural sector of the Canadian economy, particularly the farmers in the area of Canada I represent, are as follows. Additional substantial financing of the Farm Credit Corporation could be part of a program of relief from the effects of extremely high interest rates. We can provide more adequate funding for agricultural research. We need relief from the proposed excise tax as it applies to the wine industry which directly affects the returns to grape growers.
We need the co-operation of all departments of government in helping to resolve the farm labour problem, particularly as it applies to itinerant and foreign labour opportunities. We need an extension of the small business development bond to unincorporated farmers, as is mentioned in the resolution. In the Okanagan we need additional funding to service the growing number of applications for cold storage construction assistance.
These are but a few of the steps, positive in nature, which this government could undertake specifically on behalf of farmers. Farmers are Canadians first and foremost and as such have a vested interest in every aspect of national policy. They would urge this government to a quick resolution of the dispute with Alberta and a radical change in attitude and policy by this government in its National Energy Program which, as constituted, is so damaging to the Canadian economy and the Canadian spirit of unity.
With world population expected to move to 10.5 billion persons by the mid point in the twenty-first century, agriculturalists world wide will be forced to make significantly greater progress in increasing food production than has ever before been previously demonstrated. In the next 70 years, to the year 2050, Third World nations must produce much more of their own food to satisfy the hunger of this expanding population whose numbers will come mainly from those countries least able to feed present populations.
In this circumstance, farmers in North America will be called upon to triple their present production over the next 40 years. The market will be there. The mouths of millions or billions of new inhabitants of this world will be opened. The challenge will be to put current know-how and future technological advances in food production into effect.
In the generations to come politicians, economists and farmers will be required to employ all of their ingenuity and skills in preventing global famine, in preventing the increased incidence of children with stomachs extended from malnutrition and to minimize the necessity for Mother Theresa, World Vision and other such selfless persons and groups to provide havens for the emaciated, starving poor of Calcultta's ghetto and other equally condemning sores in this world.
The challenge of this next century is that of a compelling necessity to return to basics in a world that has in the last century become preoccupied with more exotic pursuits. Food, clothing, shelter and water will become the imperatives superseding space exploration, armament development and transportation modes development. The imperative will be

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Agriculture
simply to eat. Competition for food will replace the present world struggle based on the distribution of earth's energy supply. It will represent an exciting opportunity for Canadian agriculture.
We in Canada are fortunate to live on a continent which has prospered and developed through encouraging initiatives and ingenuities of her people. It has been the effort and skill of the individual talented and experienced farm population of Canada, not the state, which has made North America the productive empire that it is.
With less than 3 per cent of the total population of North America active in farming, each farmer today produces enough food to feed 75 persons. By the year 2000, through enhanced technology alone, individual farmers will be producing food for 200 persons. This in itself will not be sufficient. The capacity to increase total production which is available now must further increase dramatically.
In addition, expanded and improved food storage, processing and transportation methods must be developed to avoid the type of wastage presently experienced. Water storage, distribution and conservation must be improved. Research into more efficient use of water in agriculture is an absolute necessity, even in water rich Canada.
This is a primary essential in the Okanagan valley, a fruit producing area with an average rainfall of only ten inches annually. Even in metric measure that is dry. However, we can meet the challenge in Canada. It is simply a matter of improving farm economics and the provision of a rational political climate in which to operate, both of which are jeopardized by the attitude of this government.
The family farm is basic to B.C.'s fruit and grape production. The family farm has proved to be a more efficient producer than either the corporate or the collective farm under any political jurisdiction. One need only compare the entrepreneurial family farm concern concept with its continued increasing productivity to that of the U.S.S.R. Under the collective farm system, communist nations have gone from net exporters to net importers of foodstuffs. Poland's current problems are largely a result of that hard fact. Collectivity stifles productive enterprises and inhibits progress. The role of the state is to encourage, not control productive unions. A stable farm income is the prime goal. The most prominent income problems facing Canadian farmers today are financing the acquisition capital and financing the cost of production, or paying for farm and equipment and then paying for its operation.
The minister is quoted as having stated recently in a speech that debt charges are the second largest farm cost, and the cost of money has gone up 2.5 times faster than any other commodity farmers have to work with. The question is, knowing that, what is the minister doing to help the situation which he describes?
The minister today in his speech pointed with proprietary pride to the buoyant nature of B.C. agriculture. I think that is
a dangerous generalization. Without attempting to minimize the federal contribution made to the B.C. farming community in the form of ARDA, cash advances, cold storage construction grants, crop insurance, stabilization, etc., I must note that the chief distinction which marks B.C. agriculture is the B.C. government farm income insurance program. It is this provincial program which has created the optimism and vigour presently being experienced in B.C., and for this neither this minister nor this government can claim credit.
The compounding effect of high inflation and high interest rates is the foremost deterrent to farm efficiency and management at a time when farm production needs to be encouraged and strengthened. A 10 per cent annual inflation rate results in cost increases of more than 2.5 times in ten years. A 15 per cent inflation rate equates to a fourfold increase in cost inputs in that same period. This is the circumstance imposed by this government, and with this reverse incentive how will the farmer possibly be able to meet the demand for greater production?
Officials of the Housing and Urban Development Association of Canada recently called on government to moderate interest rates, reach an oil pricing agreement with Alberta, to reduce government spending, and restore consumer confidence. Similar advice has come from the Canadian Chamber of Commerce, representatives of small business associations and farmer groups.
David Slater, chairman of the Economic Council of Canada, told the Commons finance committee that Governor Bouey is having to go it alone in the fight against inflation because the government has no other anti-inflation policy in place. Mr. Slater said that a combination of policies might allow inflation to be dealt with and at the same time the real performance of the economy to be improved; advice offered to unhearing ears.
This government shows no sense of real restraint in its spending. Waste and neglect are its marks, patronage and self-aggrandization its tools. It is irresponsible government within Canada that is the root cause of inflation and high interest rates. We are captive of U.S. interest rates only because the government opposite chooses short-term political expediency over national well-being. That is why farm bankruptcies have increased by 77 per cent. That is why the younger generation of orchardists in the Okanagan are finding they cannot pursue their chosen vocation, some losing substantial investments. We are witnessing the destruction of hopes, the burying of ambition, the demoralizing effect of financial disasters created by careless and irresponsible action beyond the farmer's control.
Farm and Country headlines today read "Foreclosure rate soars", "Cruel interest rates take bigger toll than ever". Inside it states:
That is the problem we have now: an horrendous 12 per cent inflation rate, and an even more horrendous interest rate of 19 per cent. You see, gentle reader, no one has confidence in our ability to handle money.
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Later it states:
The only possible answer is tough federal action to bring about a balanced budget. Not this year, not next-because the sudden dislocation would cause too much hardship-but over the next three to five years.
That is what the Farm and Country says.
In the riding I represent, the Keremeos Co-op Growers Association and Similkameen United Growers Association are closing down their fruit packing facilities. At the present cost of borrowing, the move to keep abreast of modern technological advances in fruit handling is beyond the growers' financial capacity. As a result, the town of Keremeos with a population of only some 2,000 people is about to lose its major payroll, an annual loss to the business community of more than $1.5 million. This is the impact on only one community, a community which can ill afford such a knock.
We on this side of the House have been saying repeatedly that the need is to set proper and productive priorities in spending, not increase spending as the Minister of Finance (Mr. MacEachen) so frequently states. Why in the name of nationalism spend $1.5 billion, sending it out of the country to purchase a string of service stations which add not one barrel of additional production to Canada's oil capacity? It would be much better for Canada to have put that $1.5 billion, raised from long-suffering Canadians, into aspects of research and development, into cold storage assistance, into helping the Naramata irrigation district and others in equal distress to finance the upgrading of their water works. By all means, why not use the $1.5 billion to improve the role of the Farm Credit Corporation in helping Canadian farmers to meet the challenges in food production which Canada and this world face now and in the future?
The May 30 issue of The Financial Post front paged the story of a $2 million ultramodern hog farm within 20 miles of Ottawa which will be bankrupt by this weekend. The article elaborates:
The federal government has been taking it on the chin over the outcry at the rising tide of farm bankruptcies-
It goes on to state:
But there are indications from federal officials that Whelan put up a tough fight in cabinet for some sort of interest rate relief. He lost-
That is clout for you. It goes on to state:
But there's ample pressure on MacEachen to give ground.
Later it states:
The normally diplomatic and staid Canadian Federation of Agriculture has come out with a tough statement asking the government to use the federal Farm Credit Corp. to solve the problem.
It then states:
The FCC argues that the money should not detract from MacEachen's economic gradualism because it ought to be seen as an investment. The farmers would be paying it back. Treating it as expenditure in the federal budget is incorrect, says CFA Executive Director David Kirk.
It goes on to state:
-Ontario farmers are asking the Crown corporation to take over short-term and medium-term debt held by the banks and count it as long-term.
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-FCC dislikes doing this, but has always had a policy allowing it in extreme cases. And there's no question that some farmers need that help now-
There is a positive suggestion for the minister. Spare some farmer the trauma of bankruptcy by long-term refinancing of present short-term debt through the Farm Credit Corporation.
The Canadian Federation of Agriculture has asked that additional funding be put into the Farm Credit Corporation to broaden the funding base immediately, and in light of the fact that farm bankruptcies have increased dramatically, time is of the essence. Additional funding is imperative.
On another matter, I would ask through you, Mr. Speaker, that the Minister of Agriculture get together with the Minister of Employment and Immigration (Mr. Axworthy) to come to grips with the problem of temporary worker permits for farm workers visiting from other countries. The British Columbia Fruit Growers' Association and the Canadian Horticultural Council requested such, and while the minister expressed sympathy while attending the BCFGA convention in Kelowna last January, the Minister of Employment and Immigration has said no.
I have many more things that I would like to say but I will leave the matter of the excise tax until the debate on that subject later in the week.


Mr. Marcel Dionne (Chicoutimi):: Mr. Speaker, we are debating a motion censuring the government for failing to stop the increase in interest rates which have now become unacceptable to farmers. I agree that high interest rates may temporarily put farmers in a financial strait-jacket, but I suggest that we should have a look at what the minister and the Department of Agriculture are doing for Canadian farmers to protect them, and perhaps also at the level of productivity recorded in recent years by the farming community in Canada. Mr. Speaker, I am a front line advocate of the interests of our agricultural producers. This is why at the sittings of the agriculture committee 1 had asked how our taxation system applied to agricultural producers as compared with Canadian industrialists. At that time I had even suggested that the more dynamic producers in Canada be given an option to benefit from a farm loans accelerated repayment plan. Here is an example: I had then proposed that a farmer with a $200,000 loan repayable at the annual rate of $10,000 over a 20-year period, plus interests, be allowed to pay back $1,000, $2,000 or up to $5,000 a year without considering that additional repayment as an income so as to prompt the farmer into speeding up his payments to the Farm Credit Corporation, in turn making it possible for the FCC to have the funds required to make accelerated repayment loans to other agricultural producers. There is a shortage right now. The Farm Credit Corporation is already strapped for funds and we have hardly gone through six months of operations this year.

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Agriculture
Mr. Speaker, that is perhaps a very significant factor. We might examine even further what would be the consequences of such a proposal. True, the interest rate went up 2 per cent lately. I am convinced that this additional 2 per cent will not push Canadian farmers into bankruptcy since the market value of a farm has already jumped by 18 per cent this year. Hon. members will agree with me that the agricultural producer's goodwill is growing ever higher.
I think we should all consider together the tools the Canadian government could provide the farmer with in order to improve his efficiency in these difficult but hopefully temporary times we are now going through in this country. I, for one, Mr. Speaker, wish the farmer was urged to modernize his operation and even use computers which would allow him, through a terminal, to keep constantly in touch with his accountant. Let me explain. The data would be transmitted to an accounting and management centre where complex accounting, feasibility and other data would be collected. On a technical level, crop rotation, work schedules, and irrigation, fertilization, selection and even feeding tables could be established. Even environmental or weather fluctuations could be programmed. A great deal of information which is very timeconsuming to record could be regularly updated. Also, since our greatest weakness in agriculture has always been marketing, the information expert could keep the farmer daily informed of market fluctuations. The computer could even be used to monitor various things, for instance, to program animal feed or fertilization. This could allow a stricter control of the major and the minor components. Such expert programming could even result in a decrease in acreage, resulting in energy savings.
Mr. Speaker, 1 have this past year spent many hours sitting on the Committee on Agriculture. Recently, when we were considering the goverment's agricultural and food policies, 1 realized that several members, mostly from the opposition, did not understand how modern agriculture should develop in this country. While we were reviewing financial papers, we realized that many members asked serious questions, for instance, if the money spent on the agri-food industry actually benefited the farmers. The modern farmer must have up-to-date tools at his disposal. And I believe that the best tools are marketing and the development of new varieties, since marketing is a weakness in several sectors of agriculture in Canada. 1 have noticed this weakness in several productions, for instance western beef, which is world famous and which is certainly not marketed properly in eastern Canada. I believe that no money was ever spent to market or promote this excellent Canadian product and praise its nutritional value, which could increase sales on the Canadian market.
Take, for example, the dairy policy in Ontario and Quebec. 1 remember that a few years ago we had a surplus of millions of pounds of powdered milk and millions of pounds of butter, which meant millions in storage costs. Because of a firm policy and the establishment of quotas in 1975, which nearly caused a small revolution among Canadian producers, some restraint was put on dairy production. The producers decided jointly
with the provincial and Canadian governments to launch a national publicity campaign to promote the merits and the sales of dairy products. Believe it or not, sales of dairy products in Canada have increased by 4 per cent this year. This is what I call a modern tool. Experts are hired to promote Canadian products in the country.
Another example is Canadian pork, which has the reputation of being the best in the world on international markets. The proof of this is that we export for about $200 million of pork to the United States every year. I am proud, Mr. Speaker, to underline these positive achievements of our Canadian producers. A while ago, I was listening to the hon. member for Okanagan-Similkameen (Mr. King), who blamed the government for its bad policies and for causing concern among farmers. I have doubts about this. If we had implemented the opposition's energy policy and paid world prices for our oil, 1 am convinced that it would have been much more harmful than the 2 per cent interest we are now paying, because farm loans amount to approximately $300,000 on the average in Canada, and if I am not mistaken, at a rate of 2 per cent, this means $6,000 in interest, and energy costs on a specialized farm would be much more than $6,000 at current world prices.
Mr. Speaker, I would not want some people to spread fear among our farm producers. For the informaiton of my colleague opposite, I also note that when I was in the opposition, the government removed the subsidies for building vegetable storage facilities. Canadian producers should thank the Minister of Agriculture for having reinstated these subsidies in order to help them take a greater share of the market instead of importing farm products as we did for so many years in Canada.
I should also like to mention all that is being done in agriculture with regard to quality, inspection, processing, storage, and as I have already said, research on pesticides. I had the opportunity of looking closely at the general research division whose general terms of reference were as follows:
To work toward the establishment of efficient, stable and profitable agriculture in Canada.
I am sure all hon. members in this House agree on the basic principles of the general research division.
To ensure that the essential natural resources of agriculture are wisely explored conserved, used and managed.
I also feel, Mr. Speaker, that all hon. members should make it their duty to study carefully what the general research division is doing for our Canadian agriculture. I am sure that many doubts would thus be dispelled from their minds.
Now Mr. Speaker, with your permission I should like to deal with stabilization programs. We saw the government act to stabilize potato prices during two consecutive years, because producers were selling their potatoes below the average cost. We recently saw the Canadian government stabilize pork prices to the tune of some $112 million. Of course, Mr. Speaker, the government cannot do everything alone, and perhaps the Canadian pork industry may not have such influ-
June 1, 1981

ence on the global price of pork as some may believe. But although the Agricultural Stabilization Act does not meet the expectations of Canadian producers 100 per cent, I feel the program is very generous, and having talked with a number of pork producers in Quebec, I must indicate they all agreed that such an offer from the Canadian government was very acceptable and very welcome.
There is something of interest to me which we might discuss together, namely the valuation of quotas. Clearly it will be recognized that the matter of quotas is very important to farmers, and there is an increasing need for farm product quotas to stabilize production. There is, however, a question I would put to every member in this House. It is whether we are going to give some value to that quota, because young people wanting to become farmers are already complaining about the excessive price of farms. It will be recognized that if quotas are valued at some $100,000, $150,000 or $200,000, it is almost impossible for any farmer to return to farming, or for young people to get into farming. I therefore feel that this matter should be very closely examined by everyone who shares an interest in Canadian farming. And in any discussion of the dairy policy, a good look should be taken at what Canfarm has accomplished, because Canfarm has been a very modern tool which made it possible for producers to monitor their milk production very closely through a computer program. We know that tremendous progress was accomplished in that area, and all Canadian producers in that industry should be commended for having been world pioneers.
Now, Mr. Speaker, I do not want to conclude without referring to prospects of food prices. In that regard, we should give credit to our Canadian farmers for their efficiency. Most Canadians are unaware that on average, in spite of inflation, today they are not spending a larger percentage of their income to buy food than ten years ago. Indeed, their personal income has increased more quickly than food prices during the last decade. In addition, Canadians spend a lesser percentage of their disposable income for food than people in any other country in the world, except the United States which, it must be stated, is the only country in the world where food is produced throughout the year. As indicated in the following table, in 1979 Canadians have devoted an average of 13 per cent of their disposable income, necessarily after taxes, to purchase food to be consumed at home and 4.3 per cent to meals taken outside for a total of 17.3 per cent against 17.7 per cent in 1971. However, it must be recognized that our low-wage earners or individuals on fixed pensions pay a higher percentage. American consumers alone spend a lesser part of their disposable income on food, that is about 16.1 per cent. In 1979, according to the Department of Agriculture of the United States, taking into account our more limited market and our shorter farming season, Canadian farmers, producers and food distributors had an outstanding performance. According to two international studies, food prices in Canada are lower than in most other countries. A study carried out in April, 1980, by the United States Department of Agriculture indicated that, expressed in Canadian dollars, a food basket
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with 18 items cost $50.85 in Ottawa, $45.32 in Washington, $66.89 in London and $82.17 in Paris. A study by the Bank of Switzerland confirmed the Canadian consumers' favourable position and indicated that a basket with over 39 items cost $134 in Montreal, $149 in Toronto, $191 in Brussels, and $223 in Geneva. Mr. Speaker, I am satisfied Canadian producers will maintain their effectiveness, provided they keep on getting from our Department of Agriculture the tools they need so badly. Although I may recognize that the current high interest rates may hurt our farmers temporarily-a 2 per cent increase, for instance-I am sure Canadian producers will fight back and demonstrate their effectiveness as usual.


Lorne Edmund Nystrom: Mr. Speaker, I wish to commend the hon. member for Medicine Hat (Mr. Hargrave) for putting forward this motion which we are debating today. I believe agriculture is one of the topics we do not discuss enough in this House. We do not give a high enough priority to it. I also believe that agriculture is the No. 1 industry in this country and the most important industry in the world. It is one that is undergoing very rapid change in technological devices, as the hon. member for Chicoutimi (Mr. Dionne) has just finished saying. It is one which will be very important in the years ahead as the world population continues to explode. What we need at this time, Mr. Speaker, is some long-term thinking about where we are going as a nation, where we are going as a world and what we will do for our farmers to ensure we feed the world's people. I believe that some of today's problems were caused by the shortsightedness of the people who guided our policies in yesteryear.
When I hear the Minister of Agriculture (Mr. Whelan) get up and speak, as he did today, I am a little bit disappointed because he uses the line that everything in this country is the greatest, that we have the greatest policies in agriculture, that we have the greatest this and the greatest that, and the greatest minister of agriculture. To listen to the minister you would think the panacea is here, that he has reached Utopia and that the milennium is here. I find that thinking a little bit dangerous, because when someone thinks that everything is being done, then that person ceases to be useful in the function he is supposed to perform. It reminds me a little of Mohammed Ali, the old fighter who used to say, "I am the greatest." That worked for about 15 years when, suddenly, he stepped into the ring and met Larry Holmes, and he was out on the eleventh round. Maybe it is about time the Prime Minister (Mr. Trudeau) reassessed the Minister of Agriculture and placed in that position someone who would think innovatively, someone who could think of some alternatives with regard to where we are going.
It is all right to boast a little. We have a lot to be proud of in this country. I disagree with the minister when he never ceases to boast, and when he never seems to come up with any new ideas We have a great many productive farmers in Canada, farmers who have done a great deal for our nation over the

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years, farmers who have increased their productivity faster than any other sector in the country, whether it be the workers of Canada, the manufacturing sector, or what have you. They have provided a base. 1 believe that we are now at an important crossroads. We must ask ourselves where we are going. We must ask ourselves where the farm community is headed. I believe the farmer needs some protection in terms of the price he receives for the commodity he sells. We need to improve our stabilization plans so that a farmer knows in the spring what he will receive for his product when he reaps it at harvest time. We need more marketing boards. Earlier today the hon. member for Prince Albert (Mr. Hovdebo) said that the farmer is the only person left in our society who is supposed to live by the so-called free enterprise system-and it is not working. It is not free. It is the small farmer who suffers. I suggest to you, Mr. Speaker, that the farmer needs similar protection to the worker through unions or through professional associations such as doctors and lawyers have, or through such organizations as the Manufacturers' Association. They need similar protection to the groups I have mentioned by banding together to form marketing boards which are producer-controlled. In this way they will receive for their product a fair value for the work they put into it and for the capital they invest in it.
In this country we have four good examples of national marketing boards. They are the chicken, the turkey, the milk and egg marketing boards. Even though these marketing boards are not perfect, and I have many criticisms of them, such as the price of quota-

My friend the hon. member for Chicoutimi (Mr. Dionne) has already indicated that the price of quotas in Canada is already too high for ordinary people, and I fully agreed with him when he said that we need a review of our quota policy in Canada.

Despite that we can learn a great deal from these national marketing boards. We can extend them to have them producer-controlled for all products in Canada. 1 believe that should come about when the producers want it, through their own democratic elections in their own organizations.
In terms of prices, the government must back up the Crow rate. It must preserve the Crow rate in this country which the farmers fought for over so many years. This rate has benefited the Canadian wheat farmer for decades.
I turn now to the question of expenses. Earlier today the hon. member for Prince Albert mentioned many of the problems farmers have when it comes to high interest rates, the cost of farm machinery and the cost of land. I have before me a couple of letters I received from two farmers, and I think they tell the story. One is from a dairy farmer in Ontario who says that in 1980 the interest on his loan was $26,000. In 1981, on that same loan, the farmer will pay some $58,000 in interest. The second letter is from a farmer in central Saskatchewan. Last year he had a loan on which he paid interest at 10 per cent, or $16,000. This year on the same loan the
interest rate has doubled, it is 20 per cent. He will be paying some $32,000 in interest to the financial institutions of this country. This same farmer says that to meet his interest alone on 80 acres of land-half of a quarter section which he has in seed this year-the price of wheat would have to fetch $8 a bushel to finance the interest on a $60,000 loan. The price of a bushel of wheat now is about $7. Aside from the interest, he has fuel costs, living expenses, repairs, clothing and food for his family and everything else a farmer needs to live.
When I see statistics of this kind, Mr. Speaker, I wonder why the government is not more humane, why it does not place some controls on the banks to ensure that in this country we have a two-interest rates policy, a lower rate for the necessities of life, such as housing and farming, and a higher rate for unproductive borrowing for non-essentials such as television sets and the like. I have no idea why the Minister of Agriculture, who pretends to speak for the farmers, is not able to persuade the Minister of Finance (Mr. MacEachen) and the Prime Minister to introduce such a policy, to force the banks to roll back interest rates for the necessities of life in our country. Instead, under the leadership of the Minister of Agriculture, farmers see less and less money being lent to them by the Farm Credit Corporation. In 1980-81, some $516 million was available to farmers. In this year, 1981-82, the sum is down to $500 million. In 1979-80, $628 million was available to farmers. So instead of making more money available to farmers at lower interest rates and putting it at the disposal of people who are productive, who produce goods which will go into the collective value of goods and services for all the people of Canada, we see the government doing the reverse of what I call sane and putting aside less money, despite the fact that farmers are in a severe financial pinch.
The other costs about which I think we must do something very shortly are the costs of land, the price of land and the size of farms. How large are we going to allow farms to become before we finally say, "Stop it. It is big enough"? It is big enough because large farms are not necessarily more productive. It is big enough because large farms mean fewer farmers and the destruction of a rural and family farm way of life. Bigger farms mean that there will be fewer and fewer villages and towns in the rural parts of this country. The time is going to come when we will have to make some pretty tough decisions in this country about the size of farms. It is about time that this House and the farmers of Canada started to put some thought toward an answer to that very difficult question.
The other matter is the price of land. A farmer the other day bought a quarter of a section of land near Regina for $60,000. A bit farther away, another farmer purchased a half section of land for $130,000. I ask you, Mr. Speaker, when is it going to stop? When is the wild and mad speculation in land going to stop, or are we going to have a crash in land prices in the next year or two like the one we had in 1929, like the crash in the stock exchange?
June 1, 1981


Walter David Baker: How would you stop a Canadian from buying national land?


Lorne Edmund Nystrom: Mr. Speaker, the House leader of the Conservative party asked a very good question. How will one stop a Canadian from buying land and driving up the price of land? I do not pretend to know the answers to that kind of question, but I think that it is a question which we will have to address as a Parliament because the price of land, today, in my part of the world, is going out of the reach of the ordinary person, the ordinary guy. I understand it is happening in central Canada as well. We will have to come up with a solution to the high price of land. 1 would like to see the Minister of Agriculture decide to introduce some policies and some discussions about the high price of land and do something about it.
Perhaps, as the hon. member for New Westminster-Coquit-lam (Miss Jewett) has just mentioned, we should introduce more programs in other provinces and nationally, as we have in Saskatchewan where we have a land bank program. Maybe that is part of the answer. Perhaps we should have a prices review board which looks at whether prices are being inflated artificially.
Perhaps we should change our laws regarding speculation, because one of the problems we are having today is that some foreigners are coming in and they do not really care what the price of land is. They have the money to pay for it and the interest rates do not really matter that much. They can write it off. Many Canadians who are not genuine farmers have that attitude. I am referring to people who are wealthy, have a few bucks and can buy a half section of land for $130,000 or $150,000. They could write it off as a tax expense, and this drives up the price of land to the ordinary farmer who needs it and cannot afford it.
Anyway, I think these are some of the questions we are going to have to address. If we do not do it soon, we will end up in this country with larger and larger farms, fewer and fewer rural communities and perhaps corporate farms such as they have in the state of Colorado where the whole rural way of life is destroyed. They are moving into another era where corporations are doing the farming, where farm workers are working the land, and another set of problems comes along with that. I think these are some of the problems that are facing the farmer.
In my remaining five or six minutes, I want to stress that it is important that we solve some of these problems because I think agriculture is very important to all of Canada. It is very important to the consumers of this nation. We have to be more self-sufficient in agriculture if we are going to stop some of the ups and downs in the pricing that we have today. Most Canadians do not realize what would happen if we took away grain and oil seeds in this country. In 1980, we were a net importer of food to the tune of around $2 billion. Many of those foods we are importing, such as beef and many others.
We could easily be self-sufficient if we had government policies which would help the farmers plan their production. Policies could be co-ordinated with provincial governments
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toward a goal of self-sufficiency in food production in Canada at as local a level as possible so that when ordinary people buy food as consumers they could purchase fresh food near a farm, food which had not been transported great distances and would not have diminished nutritive value which results from being taken off the farm or out of a garden for a long period of time.
I also think, from the consumer's point of view, that much more effort must be put into a nutritious food policy for Canada. We have had many changes in our food system over the last 30 years since the Second World War. We have more and more additives and chemicals in foods; hundreds of them today. We have artificial and manufactured foods. There is more and more evidence that what we are doing to our food system is affecting our health. It may be the cause of some of our modern cancers and different types of heart disease that we have in this country and around the world which we cannot cure. I believe the government must once again take the initiative and do some imaginative thinking about a nutritious food policy for Canada. To repeat what some farmers have suggested, perhaps there could be a labelling program for organic produce and subsidizing or aiding farmers who want to grow foods organically. We should do more research. As my friend, the hon. member for Chicoutimi said, we should do research into the effect of chemicals on our food systems and see whether we can produce more efficiently foods which are more healthy without the use of a lot of chemicals which are very hazardous, not only to human life, but to plant life and also to the life of the soil which deteriorates over a period of time.
These are some of the problems that we have as Canadians. We are going to have to solve them very, very shortly before the possibility of a solution evades us. I do not say that lightly. There has been a recent report by a doctor in Saskatchewan, a soil scientist-I believe his name is Dr. Reny-who said that in our own province, through the lack of proper summer-fallow, the lack of irrigation in places, the lack of proper safeguards of rotating crops, tree lines and so on, and the use of chemicals and the like, the quality of our soil has deteriorated by about 50 per cent in, I believe, the last 30, 40 or 50 years.
If we do not start looking at some of these problems and if we do not start producing for tomorrow and tomorrow's generation instead of always producing for today and looking at today's dollar, then the time will come when we will not be capable of being self-sufficient in many parts of our country. If we do not start solving the problems of acid rain and understanding what it has already done to some of the crop line in southwestern Ontario and what it may do with the aid of the tar sands plants in the prairies and the wheat fields of the prairies, then, indeed, there will be a sad chapter for the future of the human race.
Those problems affect Canada and they will also affect the world. In terms of the world, I have always believed that we are a global family, that we are our brother's keeper, that we must do for others what we want for ourselves, and we must
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provide for people in Africa, Asia, China and all around the world the kinds of policies that we want for ourselves in this country.
In my opinion we have an obligation to do two things. We have an obligation to help other countries to become self-sufficient in the production of food. I believe we can do that because in this country we develop a lot of agricultural and food technology which is among the most advanced in the world. I think we have an obligation to use it to help other countries feed themselves and to put bread on the tables of hungry families. 1 do not think there is a country in the world, with perhaps three or four exceptions, that with proper irrigation and planning, and a bit of assistance from such countries as ours, cannot feed themselves.
We must also participate more in food aid programs where food aid is needed. However, we must never forget that we should not constantly just hand out food aid without trying to help people to help themselves. It is very important that we teach people to be self-sufficient.
As my friend, the hon. member for Saskatoon East (Mr. Ogle) says, we must all get away from importing luxury goods from Third World countries which we do not need and which they produce on the best land that they have. They are taking the most productive land in Guatemala, or other places in the world, and sowing crops like bananas and tobacco on it and exporting to us. Meanwhile, their own people go hungry because they are producing their food or whatever they can on secondary land. Situations like that must change, and our country and our government can take a leadership role toward that end.
A friend of mine has said that to feed the world, to provide adequate water to the world, to educate the world's people and to provide them with health services, we would need an additional $17 billion per year. That is a lot of money, Mr. Speaker-about as much as the world spends on arms every two weeks. It is spent on nuclear warheads, fighter planes, bombs, tanks, shells, guns and ammunition. It is enough to destroy the world many times over, whether it is done by the Russians, the Americans or any other country in the world. The madness goes on, the attempt of one to better the other. The madness might come to an end if countries like Canada would take the initiative as a respected middle power and say to the world that we must spend this money, the know-how and the technology we have to feed the world's people, to house and educate them and to provide adequate medical care for them.
I say to the minister, in conclusion, that we can start tonight. We are a great country. We have done great things and we are only beginning. If we realize that, we can do exciting things for our farmers, for our people and for the people of the world.


Some hon. Members:: Hear, hear!


Mr. Jim Schroder (Guelph):: Mr. Speaker, I have great pleasure in speaking this evening in this debate. My experience in agriculture has not been limited to that of practising my profession. In any case, I am proud to be one who has been of some service to the agriculture industry in this country.
The farmer needs help but he needs different kinds of help. For example, he is probably the most misunderstood person in our community. He produces a perishable product and he produces a biological product. Many businessmen are upset if they are stuck with inventory and have no way of getting rid of it, but at least they can pack it away until the next season. If fall clothes are not sold this year, they can be put away until next fall. The farmer cannot do that with his produce. He is stuck with it. Sometimes he does not have enough and sometimes has too much, and so it is very difficult to cope. He has to be a small businessman, a big businessman and an agri-businessman.
Some suggestions have been made today relative to our minister. I should like to say that his has probably the most difficult ministry in government. He has a great urban group to contend with that does not really understand very much about the difficulties of agriculture. He has to talk for the farmer and he has to act for the farmer. I should like to go on record as saying that in my experience I think our minister does a good talking job and a good acting job. He certainly does his very best to convince members of the government and the people of Canada that the farmer is somebody who really is somebody.
Some reference has been made today to the fact that we should have a fourth veterinary college in Canada, situated in the maritimes. A report was commissioned from the former dean of the Ontario Veterinary College, Dennis Howell. I should like to read from his report as follows:
Setting aside the contribution which a fourth school would make to the manpower needs of Canada, it must be remembered that, currently, an area of Canada where animal industry, both aquatic and terrestrial, dominates the economy is devoid of an animal health educational resource. In almost every brief submitted the opinion was expressed that a veterinary school located in one of the Atlantic provinces would add a much needed dimension to the livestock industry of the region by virtue of its scholarly activity, its research program and its inevitable role in professional refreshment. A second and no less significant point is: Can the young people of the Atlantic region continue to be denied, subtantially, the opportunity to fulfil their career objectives?
It follows, of course, that you cannot give this type of service to agriculture, with both the teaching facility and research facility, without the necessary faculty. There is considerable doubt about whether we should be robbing the other veterinary colleges in Canada in order to supply the necessary manpower to a fourth school. I think the following comment in the report is relative:
In general, veterinary medicine lacks opportunities comparable to those enjoyed by the medical schools of Canada under the programs of the Medical Research Council.
The exception to this is a fellowship program under the Medical Research Council which has been particularly useful for research in veterinary medicine. The report continues:
What is needed is a program, possibly administered by Agriculture Canada through the medium of the Agricultural Research Council, designed to train

young veterinarians at various levels for future academic careers. Such a program should include summer studentships for undergraduates, scholarships for graduate studies, and fellowships for graduate studies, and fellowships for study in a post-doctoral sense. The stipends need to be attractive and should be at the same rates provided by the Medical Research Council for its comparable programs.
This government has shown a fair amount of leadership in trying to establish a fourth veterinary college. I believe that we will see it in the future and that it will provide the necessary service to make sure that our animal industry in particular is provided with the kind of diagnostic service and care which will make the economical production of livestock possible.
I am sure that my colleagues from the west can recall the days when we tried to establish a third veterinary college in Canada. It was finally established ten years ago and was called the Western Veterinary College. We had the same doubts then about whether it was feasible to establish another faculty of veterinary medicine to serve the agricultural industry in Canada. We had all the same questions about where we would get the faculty, whether there would be enough jobs for the graduates, and whether it was feasible to support it. Of course, we met the same kind of arguments and in many cases the conclusions were that we would be foolish to attempt to establish this very expensive school for training veterinarians for the future.
I am pleased to say that with the co-operation of the western provinces and the federal government, which supplied 50 per cent of the necessary funds, the third veterinary school was established in Saskatoon. Within a very short time it became one of the finest veterinary colleges in Canada. It has sent graduates all over the world and I am proud to say that it has proven to be a good investment in animal health.
Recently, I travelled with the North-South task force in various Asian countries. I was very pleased to see the number of graduates in agricultural and veterinary science that there are in the Third World as the result of their training in Canada. As far as agriculture is concerned, I like to think that our profession has served well and valiantly through the years. I hope that the fourth veterinary college will be established. Some kind of fellowship program could be set up to help provide the necessary faculty so that our agricultural industry in Canada will be the leader because of the kind of support it receives.
Probably many of you do not know that we in Canada have a reputation around the world for having healthy livestock, which means that markets are open to us because we have been able to keep out those diseases which ravage livestock in many other countries. We do this by maintaining an animal population free of disease. We have inspection services which are able to spot immediately when a disease has been brought into the country. We get rid of this disease by eliminating it. Therefore, we are free of diseases such as foot and mouth and hog cholera. Obviously one disease affects hogs and the other affects livestock. These two diseases are the scourge of many countries in the world. Canadian livestock is welcome almost
Agriculture
everywhere in the world because of our high health standards. I do not want to take all the credit for the veterinarians but this standard is maintained because of the very fine management provided by farmers not only through their training in agriculture but through the usual Canadian ability to do things and to do them properly. However, this standard could not be maintained without the kind of veterinarian support they receive.
I think we can be proud of our inspection service. We can be proud of the fact that all our animals, because of their good health, are acceptable in almost every country in the world.
1 am sure hon. members know that to be a veterinarian requires a very long training program. But looking at the total agricultural picture, it is a case of everyone working together to make sure that our animal industry is the finest that is possible. To my hon. friend who spoke before me I want to say that we have the finest agricultural industry in the world. With development of confidence, with service programs, particularly relating to animal health, which I am proud to say the present government supports and in which the minister is showing great leadership by promoting these activities in Canada, we will go on with a very fine agricultural industry. In spite of our problems with credit, in spite of the fact that we are producing perishable goods, in spite of the fact that we have a biological product, in spite of the fact that some farmers want help and some do not, in spite of the fact that we do not have unanimity as to what programs there should be to help farmers, there is no question that our government is convinced that farmers are very important people in Canada. The agricultural industry is the basis of our tremendous growth. Canada is the great country it is today because we have a healthy, vibrant and strong agricultural industry.


Hon. Alvin Hamilton (Qu'Appelle-Moose Mountain):: Mr. Speaker, I would like to thank the hon. member for Guelph (Mr. Schroder) for sharing part of his time with me so that I could close the debate.
The first part of my remarks are what I intend to say at the end of my speech, namely that today's debate, and I have listened to all of it, has been rather depressing for one like myself. I know that one of the healthiest industries in Canada is the agricultural industry. I know that the opportunity for agriculture has never been greater than it is now. I know that the world wants to be fed and insists on being fed. I know that farmers not only produce the food for our table but also will soon be producing the energy to keep us warm at night. The future for agriculture is unbelievable. Whether we worry about big farms or small farms, the fact is we are moving toward intensive and more efficient agriculture because there is a need for it. If we could get these people in Ontario, Quebec and the Atlantic provinces to realize that they have a job to do and could make some money, we would soon get this agricultural industry going even better than it is today.
Unfortunately, at times snags are put in our way. Governments have done much for the agricultural industry in this country. I think the U.S. government has done very well for its farmers too. We have done a good job for agriculture, but the

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Agriculture
job is never finished. Right at the present we have a dark cloud hanging over our heads. Some nitwits in the central banks of the world, backed up by the nitwits in the departments of finance, are determined to prove that although the book learning they acquired 40 years ago is not working out, they will show it to be correct. They think if they get the interest rates high enough, all the things they studied will come true. But quantitative evidence shows just the opposite. I will not make a speech about that tonight because I want to talk about the particular subject before us.
This subject tonight really deals with farm credit. Sure the small business development bond will be a big help. I hope the government will broaden it out to cover wider sources than just the incorporated farmers. My main topic tonight is the Farm Credit Corporation. We have had a long history of credit on the farms in Canada. I will not repeat what I said before as to what happened in 1919 in that great debacle or what happened in the 1930s and what was done by all governments in an effort to solve those crises because that is past history.
If we are going to meet the challenge today of feeding the world and keeping the world warm through the production of energy from renewable resources, we have to use supplies of credit. We are based on a credit system. If we are to have this silliness of a group of academic dropouts who man our departments of finance and who man our central banks around the world telling politicians what they have to do when they know it is wrong, that it has always been wrong and it still is wrong, then we have to depend on the Minister of Agriculture (Mr. Whelan) to speak up on this subject in cabinet.


William Herbert Jarvis: Heaven help us.


Francis Alvin George Hamilton: I know that it has been said that he has enough clout. Believe me, if you ever want to have clout in the cabinet, just offer to resign and tell the people why you are resigning. All of a sudden 25 or 30 other guys in cabinet say "no, don't do that". But all you have to do is to put your resignation on the table. There is not a prime minister born now or in the future who would ever turn down a minister of agriculture, if you want to unite the people of Canada around an issue, that issue is interest rates.
The interest rate issue goes back thousands of years. In Canada it has taken our Parliament by the throat on several occasions. If you want to unite farmers from Newfoundland to Quebec right through to British Columbia, just fool around with this nonsense on interest rates. You can bring every farmer together. They could clean out 70 different members of Parliament if they wanted to. I simply ask the Minister of Agriculture to pay attention to some of the positive and helpful ideas which have emanated from this side of the House over the last two weeks.
Hon. members heard today from the hon. member for Medicine Hat (Mr. Hargrave). He put forward his concept of an individual trust system whereby the farmer in his surplus years puts his cash into a trust account. No subsidy from the government is required. He just wants to have that money available when the income is poor. It would not cost the
government anything. The hon. member went on this afternoon to suggest putting this money directly into the hands of the Farm Credit Corporation, who act as a trustee, instead of putting it into a bank or a credit union. The farmers would be glad to put money into a farm credit trust fund at 6 per cent because they will not be taxed on it. The Farm Credit Corporation could lend that money out at 8 per cent and get the young farmers up and going. Get rid of this high interest rate of 20 per cent a year and above. This is not a laughing matter that will go away next week by dropping the interest rate a point or two. Anything above 6 or 8 per cent on the productive side of our economy is lunacy. The quickest way to get it down without a subsidy by the government is to lend the money at 8 per cent. Ask the farmers to put their money into a trust account under the hands of the Farm Credit Corporation and get 6 per cent. As long as the farmer is free of tax, he will accept that 6 per cent. Not only the beef farmer but the grain farmer will do that. He will not want any subsidy when he is saving tax. He knows that money will be available when his income is low and he can take it back as income.
If that idea of loans is put before cabinet with all the enthusiasm a minister of agriculture can mount, he will have
350,000	farmers from all across the country behind him. The minute he does that, just watch the banks and credit unions get their interest rates down for every other class of people.
This is not a question of grabbing money out of the treasury. The treasury does not have any. They are borrowing like mad to pay the high price of oil. This is a positive proposal by an opposition member who has made this type of proposal before. It was originally introduced in this House some years ago by the then hon. member for Swift Current. He is not here tonight. It has been improved on and made more powerful in the way the hon. member for Medicine Hat repeated it. According to this concept, if you are going to stablize the income of any farmer, you let him have an account he can put his money into when he has a surplus. He can earn money when it is needed. He only pays the tax on it when he draws it as income.
This is an individual accounting system which does not require 10,000 civil servants to examine every item. It is a matter between him and a trustee. When the farmer puts the money into that account, he entrusts the trustee to use it for a proper purpose, to earn money and to be useful to his country. At the same time, when he wants it, it is available.
The suggestion made this afternoon that the Farm Credit Corporation handle it makes eminent good sense. The farmer could be told to put money into the trust account where he would receive 6 per cent. It could then be loaned to other farmers who need it badly at 8 per cent.
The farmer gets a better, more saleable proposal than the one I made last week. Last week I proposed that we lend money through the Farm Credit Corporation at 8 per cent. When the debt was paid back under the contract, the Farm Credit Corporation would be quite justified in getting an
June 1, 1981

interest in the additional profit. That is being done all the time in private business because businesses are caught in the same way as everybody else, including the farmer. They have to shift toward some type of equity financing on which there is no interest or some sort of an interest in their profit which has no interest on it as well.
My proposal is sensible. 1 use it all the time in private business and it works. No one loses under that system. There is no subsidy. The suggestion of the hon. member for Medicine Hat is so simple and obvious that grain farmers will put their money into those trust accounts.
Cattle farmers will put their money in and everybody who wishes he were a farmer would put his money in if he got the chance. They will not quarrel about the 6 per cent. If there is worry about the fact it will be in there for a long while, the interest could be indexed along with inflation to ensure the farmer does not suffer. Index the principal if you want. The fact remains that something practical has to be done, not next week but now.
These ideas have been put before this House for the past seven or eight years starting with the hon. member for Moose Jaw, the hon. member for Swift Current, the hon. member for Mackenzie and myself, to the then minister in charge of the Wheat Board who introduced the stabilization for grain, it was put forward then as a positive, simple alternative to help stabilize the farm income without any cost to the government. Keep the government out of it. Those proposals were passed over for this complicated, legalistic type of tax law that we got in the stabilization act. No one understands that law except the tax expert, and I sometimes have doubts about them.
I think 1 have driven home this point as well as I can. I do so not only on the basis that it makes good common sense. To go out and tell the farmer tomorrow that you are going to put this proposal before cabinet would shake this cabinet out of a year's growth. It would really smarten them up. If the minister says he is going to put it forward, and if cabinet cannot prove that it cannot be done without a shadow of a doubt, you are walking the plank and you are telling why. My God, they would come back from all over the world to make sure he does not walk it.
No one dismisses a minister of agriculture of this country without a revolution from one end of the country to the other as long as he is fighting on behalf of the farmer. It is something where you cut across party lines. Canada as it is with all its great diversity can only have one federal minister of agriculture. Sometimes he is from the west, sometimes from the east, but it cannot make any difference. He speaks for all the farmers. Regardless of what language he speaks or where he comes from and regardless of the difference of views of many farmers, as long as they know he is sticking up for them, they will forgive many of his blunders and mistakes. As long as you let them know you do not care what their politics are or where they come from and that they will get fair treatment, farmers will always back their federal minister of agriculture.
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Some of us can speak with great experience on that, having once gone against all the farmers. When they came around in a year or so, the support was overwhelming, regardless of political affiliation. They did not care that I was called Conservative because they knew that I stood up for them. With everyone against me-only one other member of the Conservative caucus supported me-I survived. I was not afraid. 1 did not want to be minister of agriculture anyway.
No prime minister is ever going to fire a minister of agriculture. If you really want to shake up the self-styled leaders of the nation who parade up and down as cabinet ministers today, just say that you were listening to this debate and you think there is a lot of sense in it. We are not asking for subsidies so the Minister of Finance (Mr. MacEachen) will not be against you.
We are asking for a simple type of proposal whereby the farmer can put his money into some form of trust account. He will do it. All you have to tell a farmer is he will get out of taxes for a while and he will do anything. Get that money out at 6 or 8 per cent, whatever you can, just say you are going to do it and every farmer's hopes will rise again. If you say you are going to back him up and there will be no subsidy, no prime minister will turn you down. Think what a morale booster it would be for the Department of Agriculture. Instead of dragging along under this situation, catching hell from one end of the country to the other, they would have their minister finally speak up, saying he is willing to walk the plank if justice is not done to the agricultural industry. That is the challenge we put before the minister tonight.


The Acting Speaker (Mr. Blaker):: Order, please. It being ten o'clock it is my duty to inform the House that pursuant to Standing Order 58(11), the proceedings on the motion have now expired.



PROCEEDINGS ON ADJOURNMENT MOTION

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

[Stage Direction]
(A)	QUERY RESPECTING AID FOR SENIOR CITIZENS
(B)	REQUEST FOR EMERGENCY ACTION
(C)	REQUEST FOR LEGISLATION TO BENEFIT WOMEN AGED 55 TO 65 YEARS
Stanley Howard Knowles: Mr. Speaker, on Tuesday, May 19, as recorded in Hansard at page 9674, I raised with the Minister of National Health and Welfare (Miss Begin) the plight being faced by many senior citizens, and in particular I asked that something be done by

June 1, 1981
Adjournment Debate
way of making an increase in the old age pension on an emergency basis.
I asked in particular that the Minister of National Health and Welfare not tell us, as others on the government side do so often, about the $35 increase that was made last summer, because in point of fact that increase has been completely eaten up by increases in food and rental costs that senior citizens have had to meet. I also asked her not to try to make the point that that increase is fully indexed as though that takes care of the situation. I pointed out in fact that during the past year, when the over-all consumer price index has gone up by over 12 per cent, the actual increase in dollars in the total amount of the guaranteed income supplement has gone up by only 8.8 per cent.
The reason, of course, the indexing of old age pensions is always behind is that it is based on a formula that permits the department to go back a month and then three months behind that and compare that three-month period with the three months before that, with the result that when pensioners get an increase in their pensions, they are never getting an increase to help them meet the costs they are having to cope with right then. It is because of that situation, I contend, there should now be another emergency increase in the amount of the old age pension, whether it is added to the basic old age security or to the guaranteed income supplement.
The minister, of course, did the very things I asked her not to do. She reminded us of the $35 increase last year and told us about the quarterly indexing that is supposed to be up to date. These are myths that any senior citizen can disprove. Then she went on to point out that the plea we sometimes make for a special cost-of-living increase for old age pensioners related to the things that they actually have to buy would not be of much help because her department had done the arithmetic and had found out that over a ten-year period the difference would be about one percentage point or .1 percentage point per year.
I tried to make the point back to her that I was not talking about what happens on a ten-year basis, but about the difficulties that pensioners are facing right now. I contend that the case is very strong for an emergency increase in the old age pension right away, and I made a particular reference to needs of women between 55 and 65 who get no pension at all.
I know we are always told that there is not any money, and 1 know that my plea for a pension increase flies in the face of those in this House, especially to my right, who are forever asking for the government to cut expenditures. I remind the government and the House of a period I remember very well when the government was not spending money, in the depression of the 1930s, and the result was that things got worse and worse. I suggest if it were not for government money that is going into the pockets of people in the form of old age pensions, family allowances, unemployment insurance, veterans' pensions and all these things, our economy today would really be in a tailspin. I suggest that far from it hurting the economy to put money into the pockets of people who will spend it on things they need, it would actually be a help to the
economy, and even the business interests that keep calling for cuts in government spending would be better off if our social programs were expanded.
I say tonight that I am sorry the minister took such a negative stand in response to my question. I still do not think that is the way she feels about these matters. I believe she wants to see pensions and other social benefits increased. I can understand her not being here tonight, but I see I do not even have the attendance of the Parliamentary Secretary to the Minister of National Health and Welfare (Mr. Frith).
I gather that the one parliamentary secretary who is here at this moment is the Parliamentary Secretary to the Minister of Justice and Minister of State for Social Development (Mr. Irwin), who will respond. I hope he will do so with a sense of justice and fair play to the senior citizens of this country.


Mr. Ron Irwin (Parliamentary Secretary to Minister of Justice and Minister of State for Social Development):: First, Mr. Speaker, it is a myth that it is going to be easier for senior citizens in the next while. It is going to get more difficult with inflation and high interest rates. I see the latest census report in the U.S., which will probably mirror ours, indicates that for the first time since 1950 there are as many Americans above the age of 30 as there are below that age. That means that we have a shrinking work force which must provide for the economic well-being of a mushrooming elderly population.
Now I think the hon. member for Winnipeg North Centre (Mr. Knowles) will be the first to admit, and I say this very subjectively, that the best social legislation has been the combination of Liberal-CCF-NDP legislation over the years, but I think it is going to be more and more difficult in these times to provide the necessary money. In the last campaign we had really only one monetary promise where money was going out with no return and that was in the area of social assistance, directed to the 1.2 million senior citizens eligible for old age security and the GIS. We kept that promise and it was very expensive. The hon. member says not to remind him of what was done, but it is a fact that we kept the promise and we put out a lot of money.
When the hon. member asked the question in the House, he stated that we had not indexed this properly, that it was only 8.8 per cent. I have checked this and that figure is for a nine-month period from July, 1980 to April, 1981. If we calculate it for a full 12-month period ending this July, it will be approximately 12 per cent, which means the single pensioner will get an additional $17 and a married pensioner $13. I know it is not enough, I know that we have to look first after the elderly and the pensioners in our society, but we are in very difficult times and that is all we can do at this particular stage in the development of our economy.
We are doing all we can for those over 65, and it was suggested by the hon. member that we go into those areas below 65, namely the single woman currently ineligible for old age security. I think he is right when he says that the Minister
June 1, 1981

of National Health and Welfare (Miss Begin) would do it if she could. She indicated a figure of approximately $730 million to do all those things she wanted to do, but I do not think she can. And I think she was quite forthright and truthful when she said in the House that the government is doing all it can to look after those over 65; it will be some time before we can look after those 55 to 65.
Mir. Knowles: By that time they will be 65.


Ron Irwin: Well, within the last 20 years we have and are providing income housing, senior citizen housing, provincial assistance, old age security and the GIS. At its worst, things are much better now than they were 20 or 30 years ago, and there is some responsibility on our citizens to do some saving of their own for their future retirement. I do not think we can continuously put the debt on the young workers of this country and expect them to go out and produce and earn money and pay the income tax they will have to pay. This is a shared responsibility.


ENERGY-EXPORTS OF NATURAL GAS TO UNITED STATES
Maurice Brydon Foster: Mr. Speaker, on May 13 I asked the Minister of Energy, Mines and Resources (Mr. Lalonde) if he would consider a policy in which he would not allow any further exports of natural gas from Canada to the United States until there was a firm commitment by the gas transmission companies like TransCanada Pipelines to serve the underserved areas of eastern Canada.
The reason I asked the question was that I was not sure whether the transmission companies like TransCanada Pipelines and the distribution companies like Northern and Central Gas Corporation Limited, which serves northeastern and eastern Ontario, had any clear direction as to just how rapidly they would served the underserved areas of eastern Canada.
There is a program in the National Energy Program called the federal distribution system expansion program which provides grants for distribution of natural gas in these communities, but the cost of the transmission lines into many of these communities will be very high. I am not sure whether that whole grant system will be adequate to cover it. For instance, in northeastern and eastern Ontario there are some 150 communities which need service, and the assistance will have to come out of that program.
In my own constituency it is estimated that it will cost something like $80 million to put through the transmission gas pipeline, part of which will be borne by TransCanada Pipelines and part by the distribution company, supposedly Northern and Central Gas Corporation. The volume of gas probably will not be adequate to amortize the cost, so it is a question of grants or the cost of that gas pipeline being borne ultimately by the producers of natural gas in western Canada, if it is added to the rate base of TransCanada Pipelines.
If we look at it in the national perspective, we see some six billion cubic feet of gas being used per year. This displaces
Adjournment Debate
about one million barrels of oil. We are subsidizing oil to the extent of $20 per barrel through the compensation program. So we will see a net saving for the country of some $20 million just in the communities along the north shore of Lake Huron. It is clearly in the national interest.
Whether companies like TransCanada will move to put in transmission facilities is highly questionable. They will not actually move ahead with it, unless they are certain that their chances of exporting gas to the United States will be virtually zero. I am hopeful the minister will ensure that more exports will not be approved to the United States until the underserved areas of eastern Canada are provided with natural gas. This only makes sense. We are spending a great deal of money under the Canadian oil substitution program to convert furnaces from oil to natural gas.
Obviously those gas transmission lines and distribution systems should be in place before we can carry out the substitution. 1 am hopeful the minister will adopt a policy of no further exports until the areas in eastern Canada which are not presently served with natural gas pipelines are being served.


Mr. Roy MacLaren (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, the central aim of our government's National Energy Program is to ensure that all areas of our country are supplied with indigenous sources of energy. In establishing that aim, we recognize the fact that we can no longer depend on oil, whether imported or domestic, to supply the greater proportion of our national energy requirements. That is why the Canadian Oil Substitution Program announced last week is so important. The program will play a key role in achieving our goal of reducing oil consumption in the non-transport sectors to 10 per cent of their total energy needs by 1990.
The administrative arrangements of COSP have been largely completed following extensive consultations. It is clearly evident that its successful implementation will be of universal benefit to the different sectors of the economy.
With specific reference to natural gas, the National Energy Program provides for federal financial assistance for distribution companies to extend service to communities which it would not otherwise be economical to connect. Officials of the Department of Energy, Mines and Resources are presently at work with their provincial counterparts to develop criteria for determining which pipeline extension programs will be eligible for assistance, and to establish the process for selecting, from competing proposals, the specific projects to be funded. This work will be completed to allow the funding of projects in the 1982 construction season. For the fiscal year 1982-83, an amount of $170 million will be available for gas distribution system expansion. This is additional to $500 million to be made available for transmission system expansion to the mari-times and to Vancouver Island.
However, it is important that I should add that this is a long-term program. It will be impossible to subsidize all

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Adjournment Debate
worthy projects in the first year. The federal government wants natural gas to be available to as many Canadians as possible and hopes that this system of grants will ensure rapid expansion.
The question of natural gas exports must be considered in terms of provisions under the National Energy Board Act whereby the board may only approve a new gas export application if an assessment of future gas requirements in relation to supply clearly demonstrates a surplus. The NEB will report on oil and gas supply and demand in mid-summer. No new export hearings are anticipated until late this autumn or next winter, and no new export approvals will be forthcoming, assuming that such are recommended, before late 1982.
To the extent that surplus may be available from time to time, there are benefits to the economy from natural gas exports. For example, this was an important factor in our balance of payments situation last year.


WESTERN DEVELOPMENT FUND-FUTURE OF PROGRAM
John Allen Fraser: Mr. Speaker, in the budget speech of October last the government announced a Western Development Fund. The words used were very precise. They were:
We have, therefore, allocated $4 billion to a Western Development Fund.
It was also stated that the government expected to spend $2 billion over the next three years.
In the budget speech it was made clear that the Minister of Employment and Immigration (Mr. Axworthy) who, I might point out, is a westerner from Winnipeg-Fort Garry, would be in charge of specific development initiatives which "will be selected in consultation with the governments of the western provinces." The Minister of Employment and Immigration was named to co-ordinate these efforts and to ensure early action as leader of a special group of ministers. This special core of ministers, as is well known, consists of 13 ministers who are to concern themselves especially with western problems. You might say they are a sort of posse and the minister from Winnipeg-Fort Garry is sort of the top hand. The promise of the Western Development Fund was repeated at the same time in the National Energy Program, which states:
The government is anxious to complement its national strategy with more specific measures to address issues of long-standing western concern.
It goes on:
As a first step the Government of Canada will establish a special fund of $4 billion to finance over the first part of the decade a series of economic development initiatives, to be chosen jointly by the two levels of government, in the four western provinces.
On December 16, 1980 the Minister of Employment and Immigration charged into print by announcing a new "blueprint document" on western strategy. Presumably this "blueprint" would let us know some of the ways the $4 billion fund would be used.
You can imagine, Mr. Speaker, with what cheers we westerners greeted the minister's call to action. I want to quote
what the minister said at that time. It was stirring stuff, Mr. Speaker. He said:
Westerners are pragmatic.
Those are his exact words. Having delivered himself of this eternal verity, he followed it with another. He said:
When they see we mean business, they'll take it at face value.
That is strong stuff, Mr. Speaker. Since the minister was assigned the task of co-ordinating specific development initiatives, we westerners assumed that these development initiatives were related to the $4 billion fund, which we were assured by the budget speech in October had been allocated. And because we are pragmatic, Mr. Speaker, we thought "allocated" meant allocated. We thought that when the budget speech of October said, "We have therefore allocated $4 billion, that it had indeed been allocated. Now, what does allocate mean? I looked it up in the dictionary and it means, "to set apart for a particular purpose". That is an exact quote. In the words of the minister, "We westerners took it at face value". Why not? Every westerner knows that if the Liberal ministers in October of last year said they "have allocated" a $4 billion fund, then that is what they have done.


Stanley Howard Knowles: Oh?


John Allen Fraser: In other words, they "set apart" $4 billion for development in the west.
Now we westerners also thought that if the Liberal government had already allocated the fund, that is, "set it apart for a particular purpose", and I am using quotes again, the Liberal government ought to know where the fund is. I mean that somehow or other they had it lassoed with the rope tied tightly to something. That is how we pragmatic westerners would have done it, and we would do it like that so no matter how much dust and feathers that fund kicked up it would still be tied to a post come morning.
So it came as a real surprise to find out through the press that maybe there is no fund. Maybe it never has been allocated. By golly, maybe those Liberal ministers in charge of western affairs never did get a rope on that fund. Why, back on May 4, the Canada Grain Council met. I will just read this to Your Honour because I know you are interested. The press reported:
'Ottawa's $4 billion development plan-promised in the Grit budget... has receded so far from sight that speakers at the council meeting made no overt mention of it.'
Those are big words for a western meeting.
It is pretty polite language for saying that the fund was a runaway that never got properly corralled. We certainly could see the problem. That allocated fund was out of the barn, so to speak, and not one of those 13 specially deputized ministers could catch it.
There was more than one westerner beginning to take things at face value, and I mean, by that: if you cannot see a fund, and if the fellow who says he has allocated it cannot show it to
June 1, 1981

you, then, being pragmatic, as the minister said we are, we concluded that maybe there is no fund, and maybe there never was a fund, allocated or not.
But, as the newspaper article put it, no one made any overt mention of it. As a matter of fact, the Minister of Employment and Immigration did not even call a press conference to tell us polite westerners what we had pragmatically figured out, and that was that there is either no fund at all or it is running loose somewhere quite out of control. I mean, we think it is probably overtly out of control. That is, it is out in the open and disappearing just about as fast as a Liberal promise can gallop.
Well, last week I asked some questions in the House about the fund and whether the advanced light rapid transit system in Vancouver would be paid for out of that elusive fund. It took a far western Liberal to finally tell the truth, like a clean breeze from off the Pacific. Senator Perrault, according to the press, said the fund has not been allocated. Well, now, we had figured that out. It makes an honest man out of the senator, but a near liar out of the government's top hand. As for the light rapid transit, how will that be paid for? Says Senator Perrault, "We have sprung the money from a different source", or, as we westerners would say, "A source of a different colour".


Some hon. Members:: Hear, hear!


Mr. Robert Bockstael (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, the commitment of this government to the growth of western Canada is well known. Recent indications of this commitment, as noted by the Minis-
Adjournment Debate
ter of Employment and Immigration (Mr. Axworthy) in his reply to the hon. member for Vancouver South (Mr. Fraser) on May 28, show the role the federal government intends to play in the west, now and in the future.
One recent example is our contribution of up to $60 million to ensure that the Vancouver light rapid transit system is built. This contribution is a firm commitment of the government, and one which will have spin-off effects, we hope, both in the British Columbia industry which will service the system, and in the Vancouver project's demonstration of Canadian transportation technology for export.
As noted on that same day in reply to the hon. member. Senator Argue's recent announcement about the sale of grain to the Soviet Union stands as another example of this government's concern and commitment.
I can assure the House that there will be more announcements and more action in the next months which will, I hope, satisfy the concern of the hon. member and this government that the federal government is playing its proper role in ensuring orderly growth and expansion of the economic health of western Canada.


Stanley Howard Knowles: But where is the fund?


The Acting Speaker (Mr. Blaker):: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until two o'clock tomorrow afternoon.
At 10.25 p.m. the House adjourned, without question put, pursuant to Standing Order.

Tuesday, June 2, 1981