1981-11-18

ROUTINE PROCEEDINGS


Mr. Gordon Taylor (Bow River):: Madam Speaker, whereas every Canadian who volunteered for service during World War I and World War II in effect offered his or her life for the country, and every man and woman went where they were directed by the government-the soldier, sailor or airman had no choice of the theatre in which he served-I move, seconded by the hon. member for Winnipeg-Assiniboine (Mr. McKenzie):
That the present regulations of the Department of Veterans Affairs providing veterans allowances only to those who served in an actual theatre of war outside Canada be amended, and that all applications from veterans be considered fairly without reference to where the enlisted person served.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE BUDGET
Mr. Walter McLean (Waterloo):: Madam Speaker, the recent budget of the Minister of Finance (Mr. MacEachen) has knocked the foundations out from under Canadians making plans for the lifetime financial security of their families. Last year 85 per cent of Canadian families who bought life insurance policies grossed less than $25,000 in income per year. Now insurance industry figures indicate that the new budget will mean a reduction of 20,000 jobs in the industry across Canada, and up to 4,000 in the Kitchener-Waterloo area alone. Therefore I move, seconded by the hon. member for Rosedale (Mr. Crombie):
That the Minister of Finance repeat his reversal of yesterday and remove his attack on average Canadians who want to protect themselves for the future, and
that he instruct his officials to correct the chaos created in the Canadian insurance industry by the budget.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EXTERNAL AFFAIRS
Hon. Flora MacDonald (Kingston and the Islands):: Madam Speaker, my motion concerns the plight of Danylo Shumuk, a 68-year-old Ukrainian patriot who has been imprisoned in the Soviet Union for many years. He is in failing health, and we now learn that he is to be sent into internal exile for the final five years of his imprisonment. Given that Mr. Shumuk has many relatives in Canada who would be glad to receive him, I move, seconded by the hon. member for Guelph (Mr. Schroder):
That this House strongly urges the Soviet authorities to review their intent to send Danylo Shumuk into internal exile, and that because of failing health he be released from prison to join relatives in Canada.


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


Some hon. Members:: Agreed.


Madam Speaker:: The House has heard the terms of the motion. Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

Mr. Les Benjamin (Regina West):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity in which the Minister of Transport (Mr. Pepin) will be interested. In view of the fact that the federal government is proceeding to abandon its responsibility to link the Atlantic provinces with marine transportation, beginning with a 50 per cent reduction in summer ferry service

November 18, 1981
between Nova Scotia and Newfoundland, I move, seconded by the hon. member for Beaches (Mr. Young):
That this House requests the Minister of Transport to freeze ferry tolls at their present level, order the 21 new vessels CN Marine needs for east coast ferry and coastal services, and rescind the announced cutbacks of ferry service between North Sydney and Argentia.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE BUDGET
Mr. Douglas Fisher (Mississauga North):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. Yesterday the Minister of Finance (Mr. MacEachen) announced budgetary provisions which will permit the completion of 20,000 residential units, more than 1,000 of which are in my riding of Mississauga North, by providing the exemption of soft costs for sites under construction before January 1, 1982, as well as the deduction from income of the interest on funds borrowed by first-time purchasers of MURBs. I move, seconded by the hon. member for York South-Weston (Mrs. Appolloni):
That this House welcomes this new initiative and applauds the minister for responding immediately to Canada's housing need.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


CANADIAN PACIFIC RAILWAY
Mr. Tom McMillan (Hillsborough):: Madam Speaker, the Canadian Pacific Railway has used asbestos, instead of gravel, to stabilize or ballast some 90 miles of rail line in the eastern townships of Quebec. Given that scientists have determined there is no safe level of exposure to asbestos, a known cancer-causing agent, I move, seconded by the hon. member for Don Valley West (Mr. Bosley):
That this House calls on the Department of the Environment to launch an immediate investigation into the matter with a view to requiring CPR to remove the asbestos from its rail lines in Quebec in order to protect the health of both the railwaymen affected and the public at large.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


POLITICAL PARTIES
Mr. Edward Broadbent (Oshawa):: Madam Speaker, I rise on a matter of urgent and joyful necessity. Whereas the Manitoba Conservatives campaigned on a platform of economic restraint known as Reaganomics, and whereas the Manitoba Liberals campaigned on a platform of economic restraint known as MacEachenomics, I move, seconded by the hon. member for Winnipeg-St. James (Mr. Keeper):
That this House congratulates the voters of Manitoba for rejecting both and electing a government that offers a positive economic future for ordinary people.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE BUDGET
Mr. John Kushner (Calgary East):: Madam Speaker, on November 16 Calgary City Council was forced to pass a motion unanimously to spend $20,000 on an advertising campaign in eastern Canada advising Canadians of the housing shortage in Calgary. Calgary City Council's motion also urged the federal government to reconsider its decision to abandon the MURB program. Therefore, Madam Speaker, as Canada is now in the midst of a housing crisis of enormous proportions, I move, seconded by the hon. member for Don Valley West (Mr. Bosley):
That this House no longer has confidence in the Minister of Public Works responsible for housing and the Minister of Finance for creating a crisis and disaster situation in housing, for threatening thousands of jobs in construction and other related industries across the country, and that the government reintroduced the MURB and soft-cost allowance program immediately to give urgently needed incentive and hope to people in need of homes.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
November 18, 1981


METRIC CONVERSION
Mr. Bill  Doram@Peterborough: Madam Speaker, the Wall Street Journal reports that the United States metric board has been told by the Reagan administration to "walk its last kilometre" by March 31, 1982. In the United States highway signs will stay miles per hour, the national weather service will report in degrees Fahrenheit, and retail food stores will continue to deal in pounds and ounces. Therefore 1 move, seconded by the hon. member for Burlington (Mr. Kempling):
That we abandon this forced march to metric and get in line with our major trading partners and thereby save hundreds of millions of dollars by staying with our traditional units of measurement, imperial. It is only by such a course that the government can truly display restraint.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE BUDGET
Mr. Don Blenkarn (Mississauga South):: Madam Speaker, in this deepening recession every assistance must be given to growing small businesses. If small business bonds for new growth were appropriate last February when the minister thought we were in good times, surely this form of interest cost assistance is more appropriate now when clearly the economy is in a tailspin recession. I therefore move, seconded by the hon. member for Brampton-Georgetown (Mr. McDermid):
That the Minister of Finance today on motions correct the foolish error he made in his budget and extend the small business development bond for the purchase of new equipment for the full year, 1982, and so give small business some encouragement to expand.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
Oral Questions



ORAL QUESTION PERIOD


Mr. Chris Speyer (Cambridge):: Madam Speaker, my question is directed to the Minister of Finance. As I am sure he is painfully aware by now, Mr. John Bulloch, who represents some 62,000 Canadian independent business men and women, had a press conference this morning, at which time he declared war on the minister's budget. He called it the greatest threat to enterprise since the Benson white paper in 1969, and I quote:
Bulloch accused the Department of Finance officials of demonstrating a shocking lack of practical knowledge of the business community and unconscionable ignorance of the functioning of capital markets.
As the tide rolls in as far as adverse comment is concerned and as far as jobs and the budget's impact with respect to investment are concerned, is the minister willing to take Mr. Bulloch's advice and to refer this matter to a standing committee where we can have public hearings on it?


Hon. Charles Lapointe (Minister of State (Small Businesses and Tourism)):: Madam Speaker, I believe that the hon. member is making the same mistake the president of the Canadian Federation of Independent Business made this morning. Madam Speaker, if members of the opposition want to answer on my behalf, they should form the government. However, since they were defeated over a year ago, they might be better off listening to the answers given by the ministers. Madam Speaker, if the hon. member had taken the trouble to read the budget, he would know that in addition to increasing the annual income limit for small business corporate tax rates from $150,000 to $200,000, in addition to exempting small business from corporate surtax, and to reducing the cost of unemployment insurance premiums for employers and, Madam Speaker, in addition to extending the Small Business Development Bond, measures which will cost the government about $400 million, which means $400 million more in the pockets of Canada's small businesses, the hon. member will realize that his question is totally unfounded, Madam Speaker.


Chris Speyer: Madam Speaker, that is just an inadequate answer from an inadequate minister.


LIMITATION ON INVESTMENT INCOME DEDUCTIONS
Chris Speyer: My supplementary question is directed to the Minister of Industry, Trade and Commerce. There are many, many repugnant aspects within the budget, but there are none more repugnant than the notion of limiting the amount of interest which can be deducted with respect to

November 18, 1981
Oral Questions
investment. The minister knows, from the studies within his own department, that 90 per cent of new business ventures are financed by loans from friends, neighbours, from relatives, and also from business associates. How can the minister possibly justify this particular action in these circumstances where no one in their right mind will make investments, and which will have such a deleterious effect on jobs?


Hon. Herb Gray (Minister of Industry, Trade and Commerce):: Madam Speaker, the Minister of State for Small Businesses has given very important information to the House concerning the value of this budget for small business. It is a major source of development, innovation, and job creation in Canada.


Mr. Wilson:: Not any longer.


Herbert Eser (Herb) Gray: The over-all thrust of the budget is to create a strong climate for growth and job creation. I am surprised my hon. friends have missed this important reality.


CAPITAL COST ALLOWANCE PROVISIONS
Chris Speyer: My final supplementary question, Madam Speaker, is directed to the Minister of Finance, who I hope might respond to this question. The minister will know of the massive tax grabs within this budget, but none are more massive than the $2 billion the government will take over a three-year period as a result of the new limitation on capital cost allowances. It was in 1972 that the capital allowance system with respect to manufacturing was implemented by the Hon. John Turner. One fifth of the jobs in Canada are created in manufacturing. How can the minister justify taking $2 billion from the private sector and transferring it to the public sector?


Hon. Allan J. MacEachen (Deputy Prime Minister and Minister of Finance):: Madam Speaker, the necessity to justify that situation does not arise, because that is not what is taking place. If the hon. member had understood the situation he would have known that there is no increase in the total revenue received by the Government of Canada as a result of the change in the capital cost allowance. The total aggregate of tax payable is not increased by one dime. The hon. member does not know that. He ought to understand the budget before he gets up and asks questions.


Some hon. Members:: Hear, hear!


TAX EXEMPTIONS FOR FOREIGN DOMICILED DEPENDANTS
Mr. John McDermid (Brampton-Georgetown):: Madam Speaker, my question is also for the Minister of Finance. Last Thursday in his budget, Canadian taxpayers learned they could no longer deduct support payments to their mums, dads and grandparents overseas. Can the minister please explain to this House how he differentiates between supporting families
in Brampton, Georgetown, Toronto and Vancouver and supporting parents in London, Tel Aviv, Athens or Rome?


Allan Joseph MacEachen: Madam Speaker, the hon. member has drawn attention to the change in the exemptions that can be claimed for dependants abroad. The hon. member may want to examine the facts that have been brought forward by the Department of National Revenue which indicate that a very large abuse exists in such claims and that many claims are put forward for non-existent dependants abroad and that it has been impossible for the Department of National Revenue in any effective way to ensure that these exemptions are not fraudulently based. It was on the advice of the Department of National Revenue that this particular change has been made.
If the hon. member is interested in equity in the tax system-


John Horton McDermid: There is no equity.


Allan Joseph MacEachen: -he should be interested in a conclusion that does not provide particular taxpayers with a way of avoiding personal income tax which is not available to other taxpayers. That is the effect of that particular change.
The hon. member is attempting to draw attention away from the very equitable basis upon which this proposal is made.


REQUEST FOR CHANGE IN SYSTEM
John Horton McDermid: Madam Speaker, if there is abuse of the system, why does the government not prosecute those who are abusing the system rather than wiping out the system?


Some hon. Members:: Hear, hear!


John Horton McDermid: Why would the minister not change the system rather than penalizing people who legitimately support their dependants overseas, many of whom rely on that support to keep life and limb together? Is it not simply a matter of the Minister of Finance grabbing more tax dollars, and of yet another attack by the Liberal government on the family?


Walter Franklin McLean: He has thrown the baby out with the bath water.


Allan Joseph MacEachen: Madam Speaker, there is nothing in the proposal that will prevent individuals from supporting their dependants anywhere in the world. What is attempted in the proposal is to provide an exemption for immediate dependants, namely, spouses and children.


John Horton McDermid: There is no abuse then.


Allan Joseph MacEachen: That seems to be a reasonably manageable situation. But any individual is still free to send any amount of money out of the country to other dependants; in this case it
November 18, 1981

cannot be an exemption as a basis for lowering the tax. That is the difference.


Mr. Clark:: That is anti-new Canadian.


LABOUR CONDITIONS
John Edward Broadbent: Madam Speaker, my question is for the Minister of Finance. Every day literally hundreds of Canadians are losing their jobs. Since August alone 50,000 men and women have been laid off. Considering that just yesterday the minister yielded to pressure from the business community to make certain changes in the budget proposals for their benefit, will he today be prepared to announce some new job-creation measure which will bring relief to the more than one million unemployed Canadians?


Allan Joseph MacEachen: Madam Speaker, the hon. member asked the same question yesterday on job creation, which I answered.
Let me tell the hon. member that the change which was made yesterday was not in response to representations from the business community, but in response to representations made by members on this side of the House and by individuals in the country who were interested in ensuring that rental accommodation programs already in place would not be disturbed and arrested because of the elimination of MURB provisions, so I extended until the end of December the inclusion of particular costs for deductibility in order that all existing programs in the housing field should go ahead.
The hon. member is again distorting the impact of a particular measure that I announced in the House in response to representations from members of the House, the effect of which is to help people seeking apartments in this country, not to help high-income owners of apartment buildings. The hon. member has it all wrong again.


An hon. Member:: Hear, hear!


INDUSTRIAL AND LABOUR ADJUSTMENT PROGRAM
John Edward Broadbent: Once again, Madam Speaker, we got no announcement of a significant job-creation program. That was the gist of the minister's answer. I will try another minister who has vaguely expressed concern about unemployment from time to time, and that is the Minister of Industry, Trade and Commerce. He has cited the great efficacy of the Industrial and Labour Adjustment Program. Considering that this program has been in operation for more than a year and has done almost nothing in terms of providing jobs- in fact in Windsor with a need for some 11,000 new jobs it has
Oral Questions
provided only 184, and in the area of Sept-Iles with an unemployment rate of 25.4 per cent only 80 new jobs have been created-is the minister at long last prepared to stand up and demand of the Minister of Finance some new job-creation program?


Herbert Eser (Herb) Gray: Madam Speaker, the Industrial and Labour Adjustment Program has over $300 million assigned to it by this government, and in the coming weeks and months I expect to see a much more vigorous use of these funds in order to expand our existing job-creation activities. I again repeat, a basic thrust of this budget, especially the assistance for the small business sector will, in my view, have a major positive effect on job-creation throughout this country because small business is a major source of job creation across Canada.


John Edward Broadbent: Thank you for the recorded announcement.


LAY-OFFS IN QUEBEC-REQUEST FOR JOB-CREATION PROGRAMS
John Edward Broadbent: My question is for the Minister of Regional Economic Expansion. The figures for the various regions of Quebec reflect as well a setback and even a deterioration of economic activities. General Motors announced last week that 3,500 workers will be laid off, Canadian Admiral will close its doors and, thirdly, 610 Pratt & Whitney employees will be given their walking papers. Here is my question: Why is there no new job-creation program in very high unemployment regions such as Quebec?


Hon. Pierre De Bane (Minister of Regional Economic Expansion):: Madam Speaker, I would like to remind the leader of the New Democratic Party-it probably slipped his mind-that one of the basic documents tabled by the Minister of Finance on budget night features the government's over-all economic policy guidelines for the 1980s. One of the major points announced by the government in that document is that the integration of the regional dimension in the sectorial policies of the government will become a constant factor in all our policies.
I am very surprised that the hon. member has not read that document. It says very clearly-


An hon. Member:: We read it in five minutes.


Pierre De Bané: -that the question of the development of every region will become central in the decision-making process of this government. We have also announced a strengthening of our capacity not only to bring the information from the regions to the highest levels in Ottawa but also to concentrate on each region.


Some hon. Members:: Hear, hear!

November 18, 1981
Oral Questions


PRESENCE IN GALLERY OF MINISTER FOR FOREIGN AFFAIRS OF THE REPUBLIC OF IVORY COAST
Madam Speaker:: I wish to draw the attention of the House to the distinguished presence in our gallery of His Excellency Mr. Simeon Ake, Minister for Foreign Affairs of the Republic of Ivory Coast.


PRESENCE IN GALLERY OF MEMBERS OF THE CABINET AND LEGISLATIVE COUNCIL OF THE NORTHWEST TERRITORIES
Madam Speaker:: I would like to draw the attention of the House to the presence in our gallery of Members of the Cabinet and Legislative Council of the Northwest Territories.


Some hon. Members:: Hear, hear!


THE BUDGET
Mr. Tom Cossitt (Leeds-Grenville):: Madam Speaker, my question is directed to the minister responsible for housing. Yesterday the minister said that the advertisement containing budget information was, and I quote his exact words:
-not authorized until following a meeting of the cabinet committee on communications, Friday, November 13, at approximately 12.30 p.m.
He went on to say:
After reviewing that ad with suggested changes, authorization then was given for the use of that ad in advertisements the following day, November 14.
That is the end of the quote.
How can the minister stand behind such blatantly inaccurate statements when the advertisement was actually authorized camera-ready for printing, and in the hands of numerous newspapers, before cabinet approval, and how can he say that the cabinet authorized printing of the advertisement for November 14 when, in actual fact, it was ordered and authorized by Vickers and Benson on November 9, three days before the budget, for publication on November 13?


Hon. Paul J. Cosgrove (Minister of Public Works):: Madam Speaker, I have had the opportunity since responding to the questions yesterday afternoon to speak to officials on this matter. I would confirm that the story reported in The Globe and Mail today, on page 8, does consist of the facts as I understand them. The facts are correct that, first, no publication of any material affecting housing in the budget was printed until after the budget, that is, November 13.


Some hon. Members:: Hear, hear!


Paul James Cosgrove: I also confirm that no material pertaining to that advertisement was in the hands of the firm to which the
hon. gentleman has just referred. Indeed, their work for Canada Mortgage and Housing Corporation was to obtain space, which they did.
I would add, finally, that after the budget was deliverd in this House, representatives of Canada Mortgage and Housing Corporation released an advertisement, which was then taken to the newspapers after the budget was delivered by the Minister of Finance in this House.


Some hon. Members:: Hear, hear!


TELEGRAM SENT BY ADVERTISING AGENCY
Thomas Charles Cossitt: Madam Speaker, the minister with his misinformed tongue is apparently allowing it to run away with his mouth, as usual.


Some hon. Members:: Oh, oh!


An hon. Member:: Shame!


Some hon. Members:: Question.


Thomas Charles Cossitt: If the jackals will be quiet, I will refer the minister to a telegram sent by Vickers and Benson on the day of the budget, addressed "Urgent to all advertising managers re: CMHC", the wording of which I have here, identifies the advertisement by its actual heading. How does the minister explain the fact that, despite his denial and that of Vickers and Benson, the advertising agency was able to quote from the CMHC advertisement before cabinet approval, which he says was not given until a day later? How does he explain that an official of Vickers and Benson told my office yesterday that they had the CMHC ad material, and I quote the exact words used, "We sent the material out on Wednesday", and Wednesday was the day before the budget? I ask the minister to tell us what was the exact sequence of events.


Some hon. Members:: Hear, hear!


Paul James Cosgrove: Madam Speaker, the last thing I would do in this House, or in my responsibility as a minister of this government, going on my very brief experience, would be to rely on anything quoted by anyone to that member opposite.


An hon. Member:: Right on.


Some hon. Members:: Hear, hear!


Paul James Cosgrove: The member has taken a telegram which referred to space taken in newspapers across the country to assist Canadians and members of this House to explain the government's proposed plan. It referred to it by one word, "Attention", and that is the only information that Vickers and Benson had, one word. That is how it described the ad.


Thomas Charles Cossitt: Now you are starting to admit something.


Paul James Cosgrove: Now, Madam Speaker, that material was released after the budget. It was sent to newspapers the
November 18, 1981

following morning after question period. I attended a meeting of the communications committee of cabinet because I wanted the advice of my cabinet colleagues as to whether the initiative I had taken to put that material in the hands of newspapers-


An hon. Member:: Impossible.


Paul James Cosgrove: -on the weekend was adequate. They said it was, and it was released for large distribution on the weekend.


An hon. Member:: How could it have been?


TIMING OF ORDERS PLACED BY ADVERTISING AGENCY
Hon. Perrin Beatty (Wellington-Dufferin-Simcoe):: Madam Speaker, my question is also for the minister for housing.


Some hon. Members:: Oh, oh!


An hon. Member:: Not again.


Henry Perrin Beatty: I can understand their unease after the minister's answer.


Some hon. Members:: Oh, oh!


Madam Speaker:: Order.


Henry Perrin Beatty: Madam Speaker, my question is for the minister responsible for housing. The House will recall that on numerous occasions, including yesterday, the minister responsible for housing indicated to the House that the first time he became aware of any provisions in the budget relating to housing was just a few minutes before the budget speech was given by the Minister of Finance in the House of Commons. If that is the case, why did Vickers and Benson send out orders on the evening of November 9 requesting space to run an advertisement announcing the housing provisions which would be announced in the budget some days later?


Paul James Cosgrove: Madam Speaker, obviously the hon. member has forgotten that I was requested by many members on the opposite side, and I am not sure whether by him in particular-


An hon. Member:: You are not sure of anything.


Paul James Cosgrove: -to assist home owners in this difficult time of high interest rates. I worked three months in preparation, advising the government on its preparation for the budget to deal with that very problem. 1 took the initiative to have Canada Mortgage and Housing Corporation prepared to respond as quickly as possible in light of the interest, not only in this House, but across the country, in the problems of high interest rates faced by home owners.
I am really surprised, Madam Speaker, in light of the requests that come from the opposite side-as late as today there was a request by a member for assistance from me to help one of his constituents-


An hon. Member:: What are you there for?
Oral Questions


Paul James Cosgrove: -that I should be criticized for taking initiatives to help them.


Some hon. Members:: Hear, hear!


ROLE OF CABINET COMMUNICATIONS COMMITTEE
Henry Perrin Beatty: Madam Speaker, you will note that in the minister's hysterical response he did not answer why it was that Vickers and Benson, if he knew nothing about the budget, was reserving space on November 9, well before the budget was brought down.


Some hon. Members:: Hear, hear!


Henry Perrin Beatty: The minister's whole defence is that, when it comes to housing, nobody tells him anything.
My supplementary question is for the Secretary of State, who is chairman of the cabinet committee on communications. Would the minister tell us why if Canada Mortgage and Housing Corporation had already sent the advertisements out-they were printed in some papers on the Friday morning-why was it that the cabinet committee on communications did not even consider the ads until lunch time? Also, why was Vickers and Benson asked to reserve time and space when the government has the Canadian Media Corporation on contract to the tune of some $2,430,000 to do that?


Hon. Gerald Regan (Secretary of State):: Madam Speaker, the hon. member, in his lack of understanding of the system, has combined a number of rather unrelated questions. It might take longer than the time given to me to respond in this House, to educate the hon. member. He might be aware, as I indicated yesterday, that ads are often placed without the recommendation of the communications committee, because it is obviously not possible for every ad to come before that committee. What the honourable and distinguished minister, who is doing a good job for the people in battling housing problems in this country, did, was to come to the communications committee to talk about an ongoing program explaining the provision of housing assistance in the coming weeks and, in the course of that, he presented the ad which had been approved the night before and sent out.


Some hon. Members:: Oh, oh!


Mr. Dick:: You'd better get your stories straight.


Madam Speaker:: Order.


Gerald Augustine Regan: Despite the howls of glee on the other side, I want to reiterate what I just said, because there obviously is some collective misunderstanding on the benches opposite. What I said was simply that he came to the cabinet communications committee for a discussion of plans for ads in the coming days, and he brought with him an ad, which the hon. member and other hon. members have referred to as appearing

November 18, 1981
Oral Questions
in the paper that morning. This was the first connection the cabinet communications committee had with it.
The hon. member then asked a number of other questions which are hard for me to remember. However, he asked why this had not gone through the AMG. Many ads are placed by departments directly. There is a vast number of ads dealing with such matters as recruiting, tenders, and various other subjects.


IMPACT ON EXPANSION OF SMALL BUSINESS
Mr. Pierre  Gimai@: Madam Speaker, my question is directed to the Minister responsible for Small Businesses and Tourism. On the subject of the small business development bond program, a measure that was greatly appreciated by Canadian businessmen during the past year, could the minister tell us, following the budget that has just been brought down and for the benefit of Canadians, especially Canadian businessmen, and for the benefit of the official opposition which seems to have trouble understanding our new budget, could the minister tell us what impact the new budget will have on this measure?


Charles Lapointe: Madam Speaker, I am happy to inform or rather to reconfirm to the House and especially to Canadian businessmen and women that the small business development bond program has been extended for one year, in fact requested by most members and the majority of associations representing small businesses in this country. In addition, Madam Speaker, the program has been extended to all unincorporated businesses. I remember that many members and especially the member for Kamloops-Shuswap (Mr. Riis) repeatedly asked to have the measure extended to unincorporated businesses. Its application has been restricted to businesses in financial difficulty, because that was the original objective of the program which was aimed at giving assistance to those needing it most.


EFFECT ON RETIREMENT INCOME OF FARMERS
Mr. Lome Nystrom (Yorkton-Melville):: Madam Speaker, my question is for the Minister of Finance, and it concerns the elimination of annuities for retiring farmers. As the minister knows, when many farmers sell their farms they do not have pensions, and they live off annuities as a form of retirement income.
Let me refer, for example, to the real case of one farmer with three quarter-sections of land. The figures I have, which have been worked out by a Saskatchewan accounting firm, show that if this farmer sold his three quarter-sections of land, under the old rules his taxes would have been $5,000, and under the new rules, after the budget, they will be $72,000.
I would like to ask the minister how he can justify the increase of tax in the year of sale from $5,000 before his budget to $72,000 after his budget. Is this not blatant discrimination against the small farmer?


Allan Joseph MacEachen: Madam Speaker, I do not think there is anything in the budget which would justify those numbers. If the hon. member would give me the details of the case, I will have them examined in detail and remove, I trust, some of his apprehensions.
The purpose of most of the provisions in the budget is to avoid a deferral of tax for certain taxpayers when such a deferral cannot be enjoyed by the vast majority of taxpayers or tax filers in our system. There have been many transactions up to the present time in which in some cases indefinite deferrals of taxes have been permitted, and those deferrals have not been available to the vast majority of taxpayers who depend on employment income. It is in order to remove these inequities that certain changes have been made so that all taxpayers will be contributing in a similar way. There is absolutely no effort to discriminate against any particular class of taxpayer, but it is impossible for me to judge a particular case, and I will want to get more information.


REQUEST FOR EXEMPTION FOR CERTAIN FARMERS
Lorne Edmund Nystrom: Madam Speaker, since most farmers do not have pension plans but rely on the sale of their farms for retirement income, I wonder if the minister might consider a basic exemption for farmers who are in that category-and, indeed, small businessmen-because not only do they lose immensely on taxes in the year of the sale but, according to the accounting firm, a small farmer with three quarters of a section of land would find himself in the years after a sale losing about $6,000 of income annually. Would the minister consider an exemption for farmers who are in that kind of situation?


Allan Joseph MacEachen: Madam Speaker, the purpose of the changes which have been included in the budget has been to establish a broad sense of equity in the tax system so that individuals in receipt of investment income or capital gains will be treated on a reasonable basis with taxpayers receiving their incomes from employment. The broad thrust is equity. It is not to add to inequity which may exist in the tax system. For that reason I would be pleased to consider any suggestion that would enhance the equity I am attempting to create within the tax system.
November 18, 1981


CMHC ADVERTISEMENT-INFORMATION RELATING TO HOUSING PROVISIONS
Charles Joseph Clark: Madam Speaker, my question is directed to the minister responsible for housing, who chose his response very carefully. He indicated that there had been no publication prior to a certain date. As he knows from the exchange yesterday, what is at issue here is not the date of publication but the date of advance release of information contained in the budget. The minister has said that he knew nothing about the contents of the budget on November 10, although Vickers and Benson advertising was reserving space in his name on November 9, the day before he says he knew anything.


An hon. Member:: So what?


Charles Joseph Clark: "So what," the Liberals ask. "So what" about the breach of budget secrecy. "So what" about the waste of public taxpayer money.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: My question to this "so what" minister of this "so what" government is very precise. Can the minister tell the House of Commons exactly to whom this detailed budget information was given? To what individuals, inside or outside government? When was it given, and on what authorization was this detailed budget information given?


Paul James Cosgrove: Madam Speaker, I have to say again to the Right Hon. Leader of the Opposition that no material was released from the government to the public or to anyone until after the Minister of Finance had completed his budget speech in this House on budget night. I wish to make that clear. There was no breach of secrecy whatsoever.
As the minister reporting to this House for the CMHC I am discouraged at the thrust of questions such as this one from the Right Hon. Leader of the Opposition. Over the last three weeks the Leader of the Opposition and the Leader of the New Democratic Party have been tripping over one another to release to the public secrets of what they perceived and thought to be a secret document prepared for budget consideration. [DOT]


QUERY RESPECTING PUROLATOR FIRM
Charles Joseph Clark: The
minister's revised position now is that there was no information made available to the public. It will be interesting for the House to know what he defines by the "public" because of their contractual relations with Vickers and Benson, Purolator and others. We would still like to know the exact information and dates on which that detailed budget information was made available outside the bureau of the office of the Minister of Finance. We would like to have that information.
Oral Questions
I should like to ask a question about Purolator, the organization which carried this advertisement to some 140 newspapers, by the minister's evidence, across the country. On what precise date and by whose authorization, and by whose foreknowledge, was the information made available to Purolator?


Paul James Cosgrove: The
preparation of the material in question was undertaken by officials of Canada Mortgage and Housing Corporation who worked with me, as I have indicated, over the last few months, giving advice to the minister in anticipation that there would be relief offered in the budget to the mortgage renewal situation. Because of that, space was reserved in the newspapers, on my instructions. At eight o'clock on the evening of the budget I indicated that the material, as I understood it, could be released as reflecting the position of the government.


An hon. Member:: You did not say that yesterday.


REQUEST FOR REFERRAL TO PARLIAMENTARY COMMITTEE
Charles Joseph Clark: This statement is contradictory to what the minister said yesterday in the House. Let me ask the Secretary of State of Canada a question regarding Canada Media Corporation to which this government is paying over $2 million to do the job that apparently Vickers and Benson is doing. Why was Vickers and Benson involved in this particular transaction if the Government of Canada has retained Canada Media Corporation at $2 million to do exactly what Vickers and Benson did in this case?
Because there apparently was the issuance of budget information released outside the office of the Minister of Finance prior to its publication in the budget, in the House, on the evening of November 12, by the minister of housing's admission, and in light of the fact there is this controversy about the possible premature release of this information to newspapers across the country, will the minister give this House an undertaking that he will refer this whole question to the appropriate committee of this House so that we can put detailed questions and receive detailed answers as to exactly what went on here, who was told budget information prior to its publication, what was the role of Vickers and Benson and the role of Canada Media Corporation?


Gerald Augustine Regan: Madam Speaker, I am not sure I can give the hon. member any information that will help him in his witch hunt. I suggest to the hon. member that I may be able to give him a better understanding of the system with which he is concerned. First of all, an advertisement that is placed by a government agency, such as CMHC or Crown corporations, does not usually follow the same procedure as advertisements that are placed by government departments. It would be less likely that CMHC would have occasion to be involved in such a circumstance or the cabinet committee on communications.
In relation to the other part of the question, that might be more properly directed to the minister. I should like to point

November 18, 1981
Oral Questions
out to the right hon. member that it is not at all unusual for a minister, who has made representation to the Minister of Finance as to what he hopes to have included in the budget, to make preparations to advertise, in the hope and confidence that the minister will follow his recommendation, but, nevertheless, he is in the position of not knowing, until the budget is introduced or until he is briefed in the hour before the budget is introduced, whether it will or will not be budget material.
Because the minister in question did not have the sealed envelopes delivered until after the budget was introduced in the House, this showed, indeed, that he was not sure whether the information would actually be contained in the budget. It certainly confirms and strengthens the position the minister has put forward.


REFORM OF PENSION LEGISLATION-INQUIRY RESPECTING MINISTER'S PLANS
Mr. Bob Rae (Broadview-Greenwood):: Madam Speaker, my question is directed to the Minister of National Health and Welfare.
In view of the statement in the budget that government tax revenues will not be sufficient to provide for any new social measures, and that substantial cuts are expected because of inflation, what are the minister's plans with respect to pension review?


Hon. Monique Begin (Minister of National Health and Welfare):: Madam Speaker, first of all I would like to point out, if I may, that the preamble to this question cannot be assigned the slightest credibility. I do not know, and the hon. member has not told me, where he got his information.
Obviously, at this point we cannot launch new programs for social spending. However, we have managed to hold on to indexing of all Canada's social programs.
That being said, I am grateful to the hon. member for giving me an opportunity, and I shall make use of it immediately, to point out that the study on pensions in the private sector in Canada will probably be the most important document on social reform to appear in the eighties.
I have not yet heard the official position of the New Democratic Party on the subject, and we are still waiting to hear the views of the Progressive Conservative Party. On this side, we shall be publishing a green paper, very shortly, which will show Canadians what kind of changes we would like to see and for which we would like their commitment, to help us take measures that will benefit all Canadians.


INCOME TAX CREDITS-MEASURES TO MAKE TAX SYSTEM MORE JUST-MINISTER'S POSITION
Bob Rae: Madam Speaker, the minister is actually talking about the whole pension system, since instead of addressing the review of the public sector's system and the Canada Pension Plan, she is referring to a review of the situation in the private sector and corporate pensions, which is indeed a dramatic shift in Liberal policy.
The minister is witnessing substantial cuts in social spending and is aware that the Canadian Council on Social Development has criticized this reactionary measure in the budget. In view of the minister's statements in favour of tax credits to make our tax system more equitable, and considering the fact that the system now being proposed by the Minister of Finance gives more benefits to the rich and less to the poor, how can the minister remain a member of a government that has rejected all her social and fiscal proposals?


Monique Bégin: For a very simple reason, Madam Speaker. I have less trouble understanding what I read than the hon. member does. It seems to me he has missed the point entirely, and in any case, I do not think he knows what he is talking about. Regarding his first question on pension, the expression "pension review', has been used for a year and a half because on this side of the House, a study on corporate pension review was started a year and a half ago. When he refers to the review of pensions in the public sector, he should know, and there have been references in Hansard for months, that thia 6uvernment, as soon as the economic situation permits, intends to give first priority to completing the work started and consolidated in July 1980; that is, to bring single persons above the poverty line by supplementing the $420 given in July 1980.1 think this is quite clear, and I do not see what his problem is.


THE CONSTITUTION
Flora Isabel MacDonald: Madam Speaker, I have a straightforward question that is directed to the Prime Minister, regarding the constitutional proposals. Will the Prime Minister confirm that all of the provinces, except Saskatchewan, have now agreed to the inclusion intact of the equality clause, Section 28, as it was introduced to the House of Commons earlier this year with unanimous approval by all parties of this House?


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, the negotiations on this particular subject have been going on for several days because it was a matter of clarifying what the premiers intended when they signed the accord. There has been, effectively, disagreement between them as to
November 18, 1981

what particular interpretation should be given to a particular section. I can only say that to this moment it has been impossible to get all nine premiers who signed the accord, on the same wavelength, and to agree to the same text.


Mr. Blackburn:: You do not have to worry about Sterling Lyon any more.


Pierre Elliott Trudeau: Since we told the provinces that we would be tabling the resolution in its final form today, as a direct answer to the hon. lady's question I must say that there is more than one province which disagrees with the complete restoration of the section as it was. Therefore, in the spirit of the accord, I think we will have to go with a modified version of the text that we had originally proposed, not only in the resolution which has been before the House for a year, but also in the drafting sessions. I do not think it is appropriate to point out any particular province. There has been a great deal of negotiations going on, but obviously there is some lack of unanimity among the provinces as to what was intended in the accord.


PETITION
Madam Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the Table the Report of the Clerk of Petitions stating that he has examined the petitions presented by the hon. member for Fundy-Royal (Mr. Corbett) and finds that they meet the requirements of the Standing Orders as to form.


PRIVILEGE
Hon. James A. McGrath (St. John's East):: Madam Speaker, my question of privilege concerns questions raised in the House today and yesterday directed toward the minister responsible for housing, notice of which was given to Your Honour in accordance with the provisions of the Standing Orders.
Sir Erskine May, in his current edition, in Chapter XXX, referred to the importance of budget secrecy. It is a well-known convention, although I would say that it has more than the force of a convention, that budget secrecy is absolutely essential if the government is to enjoy the confidence of the House. It goes beyond that because if we are to subscribe to the convention of budget secrecy, and if others outside the House, outside cabinet, are to be given information before that information is given to the House, then I submit that it is a violation of my privilege as a Member of Parliament. That
Privilege-Mr. McGrath
argument has been made before and it has been entertained by the Chair.
As reported on page 12837 of yesterday's Hansard, Madam Speaker said:
What is at issue is the matter of secrecy of the budget, which is not to be dealt with under privilege.
I submit with respect that it is a matter of privilege; it is a matter of my privilege. If the budget is released to others outside the House before it is delivered to the House, my privileges as a member of the House have been violated. That is the whole pith and substance of my argument, but it goes beyond that because Madam Speaker said that I have to lay a charge. I do not have to lay a charge. All I have to do is to present to you evidence which in your opinion would constitute a prima facie case. Madam Speaker has to rule whether or not that evidence constitutes a prima facie case of privilege. It is then up to the House or a committee of the House to rule on the matter of substance itself.
I referred to the matter involving the hon. member for Kenora-Rainy River (Mr. Reid). I think that is very important and very germane to my case because at that time the hon. member for Oshawa (Mr. Broadbent), the Leader of the New Democratic Party, was successful in placing before the House an amendment which was in fact accepted by the Chair, by your distinguished predecessor. The hon. member was not asked to lay a charge; he was not asked to stake his seat on it. He merely presented an amendment that contained very serious allegations, which is precisely what I am trying to do. I think the House should be aware of what that amendment said. It read:
-and that the said member had advance knowledge from official sources of amendments to be proposed to a bill emanating from the said budget and conveyed that knowledge to businessmen.
At that time the Speaker did not immediately ask the hon. member to stake his seat on that charge, because that was a charge. Mr. Speaker merely accepted that motion as an amendment to the motion before the House. It was put to the House and it was agreed to. It so happens that subsequently the committee found that the hon. member was not in fact guilty of betraying budget secrets to a businessman or to anybody else, and he was exonerated. It is conceivable that if this matter is referred to a committee, the minister for housing could very well be exonerated. That would be the end of it and I would not lose my seat. But Parliament will at least have been given an opportunity to examine the evidence, an opportunity which we cannot possibly have within the precise four corners of question period. It is impossible to go into the kind of detail in question period that can be done in the course of a committee hearing. I submit that the evidence is mounting and, notwithstanding the assurance today of the minister of housing whereby he stated categorically that there was not a budget leak, there is mounting evidence that there were persons outside of cabinet, outside the House, who had knowledge of the budget prior to the budget being delivered to the House.
If this matter goes to committee, I would attempt to establish that it is physically and logistically impossible for an

November 18, 1981
Privilege-Mr. McGrath
advertising agency and for a courier like Purolator to be given the go-ahead and to be given copy for an advertisement on Thursday night at eight o'clock and for that advertisement to appear in papers across the country the next day, Friday. That is physically and logistically impossible. If Your Honour accepts my prima facie case, I would establish that in committee. I have already established it to my satisfaction by checking with Purolator, by checking with the airlines and by checking with various newspapers. Either the minister of housing has been badly misled or, more seriously, the minister is misleading the House. In any event, the House is entitled to determine the facts. That is all we want, an opportunity to determine the facts.
I do not know the origin of the myth that every time a member rises to state that he has evidence indicating a serious wrongdoing by the government, he has to stake his seat on it. That has no basis in historical fact, in my opinion. It is a dangerous myth which has crept into the proceedings of the House which can only serve to restrain further members of the House in appealing to the Chair as the custodian of our rights and privileges. I appeal to Madam Speaker, as the custodian of our rights and privileges, as one who has conferred upon her the mantle of infallibility. We cannot challenge your rulings, and rightly so. But the fact that we cannot challenge your rulings makes it incumbent upon Your Honour to think very carefully before you rule, because your rulings will stand as precedents by your successors and could in fact serve to restrict even further the rights and privileges of members of the House.
I submit that there is evidence. Evidence has been produced during the course of question period both yesterday and today. There is further evidence to be produced. Witnesses should be heard. They should be examined, if necessary, under oath. The minister of housing should be examined. The president of CMHC should be examined by the committee. The president of Vickers and Benson should be examined, the courier should be examined-all these people should be examined so that we can determine the facts. If there was no budget leak, that is well and good but if there was then obviously the convention dictates that the Minister of Finance (Mr. MacEachen) has to resign.
If you find that I have a prima facie case of privilege, I would therefore move, seconded by the hon. member for the Yukon (Mr. Nielsen):
That the advertisement which appeared in the Brockville Recorder and Times, on the morning of November 13 over the authorization of the minister responsible for housing, contains budgetary information which was in the hands of the said Brockville Recorder and Times prior to the reading of the budget in the House on November 12, 1981 and which constitutes a prima facie breach of the privileges of the House and that it be referred to the Standing Committee on Privileges and Elections.


Mr. David Smith (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, I think it is quite important to note that my friend on the other side has referred to Erskine May. The reason he has done that is that there is no
reference either in the Standing Orders or in Beauchesne that would suggest that in the event that a budget leak occurs, it constitutes a breach of privilege. There is no precedent for Your Honour to find a prima facie case of privilege on this alleged leak or any other leak, Madam Speaker.
My friend has referred to Erskine May, nineteenth edition, at page 787 where this statement appears: "-budget resolutions ... which by their nature must be secret until the financial statement is made-." That is the only reference to it. The principle that is spelled out is that this may have become a political convention, it may have become a custom and it may have become a courtesy of the House, but in fact there is no precedent to suggest that this constitutes a breach of privilege.
Before a motion can be treated as privilege I would submit that you, Madam Speaker, must find that a prima facie case of privilege exists.
My friend has used the Reid case as an example. I think it can be distinguished quite clearly from the facts before us at the moment because in that particular case the motion presented by the hon. member for Kenora-Rainy River (Mr. Reid) claimed that it was his privilege as a member of the House that had been offended by a newspaper report. I think it appeared in the Montreal Gazette.
If we are looking for precedents in the House, that best occurred in 1924 and that was the Porter case. I should like to refer my friend to the Journals of the House of Commons for Thursday, May 22 1924 when a motion was made by Mr. Porter which reads in part as follows:
The Honourable James Murdock, Minister of Labour, did withdraw from the Home Bank at its Ottawa Branch on the 15th day of August, 1923, two days before such bank's failure, thousands of dollars on deposit therein to his credit, using certain information he had received, as such minister-
It goes on to say that he had done this to his advantage. The motion was passed and the matter went to committee, which had the power to call witnesses and make whatever investigation it thought appropriate. The second report of the committee was issued on June 17, 1924, and is reported in part at page 402 of the Journals for that date as follows:
The Committee finds that the Honourable Jas. Murdock did nothing in connection with the withdrawal of such money from the Home Bank contrary to his obligation as a Minister of the Crown, or in derogation of his office and the honour, dignity and traditions of Parliament, and that the charge submitted to this Committee for investigation, so far as it affects the honour of Mr. Murdock, is not only not proved but entirely disproved.
The significant word is "charge", Madam Speaker. I would refer my friend now to Journals for June 27, 1924. Mr. Porter, the member who had made that charge in the House, read a letter to the House which contained the following statement:
I shall therefore place myself without delay in the judgment of the electors of my constituency, the West Riding of Hastings, and ask them to pronounce upon my conduct, upon the one hand, and the conduct of the Minister of Labour and the government and its supporters, on the other.
He resigned his seat. A byelection was held and the member who had made the charge, which the committee rejected after investigating the facts, was not re-elected in the byelection.
If we are looking for a precedent, that one pertains to the facts that are before us today. This is not a place in which we
November 18, 1981

trigger witch-hunts any time someone figures that he wants to put in question the honour, dignity and the reputation of a very honourable minister.
If someone wants to pursue this in committee, then I think he must put up or shut up. We are speaking about reputations and that is a serious thing. If we look to the traditions of this House, we find that there is only one precedent to guide us in this situation and that is the Porter case in 1924 which held that if a member makes a charge and the charge is not substantiated, then he resigns his seat and suffers the consequences.


An hon. Member:: Nonsense!


Some hon. Members:: Hear, hear!


Thomas Charles Cossitt: Madam Speaker, it is my intention to make a very brief contribution to this matter.


An hon. Member:: Make a charge.


Thomas Charles Cossitt: Hon. members opposite seem to have a habit of mumbling, which is not unusual because they are jumpy over what is happening.
I do not intend to go into quotations from various rules which I think support the stand we have taken. Things have been adequately presented by my colleague who spoke a few moments ago. I simply intend to bring forward a very basic point and that is, if a member of this House finds that budget information has been heard outside this House or, rather, is in the possession of people outside this House before this House has it, that is a breach of my privileges, the privileges of everyone in this House.
The Leader of the Opposition (Mr. Clark) pointed out that it is really irrelevant whether the information has been printed, as the minister said; what is relevant is who had possession of it. That is a very serious matter. It becomes more and more obvious all the time that this information was in the hands of persons other than the Minister of Finance (Mr. MacEachen) and his officials who would be sworn to the usual and expected secrecy. It appears more and more obvious that a very distinct breach of privilege has occurred as the result of what happened.
We have heard two ministers speak today. The minister responsible for housing completely contradicted what he said yesterday. He made one set of statements yesterday and today he said that is not the way it really happened and that it happened in another way. The minister who is chairman of the-


Madam Speaker:: Order, order. I just want to remind the hon. member that if he wants to enlighten the Chair on his question of privilege, he would have to deal with the question of privilege and not argue the case. The case can be argued at length once the Chair has found that there is a prima facie case of privilege. At this particular point, however, members have to concentrate on indicating to me where the privilege of a member has been breached. The member was arguing the
Privilege-Mr. McGrath
case, and I know he will want to do that later if I find there is a prima facie case, but not at this point.


Thomas Charles Cossitt: Madam Speaker, it is not my intention to argue the case. It is my intention simply to state that it is obvious that others, outside this House and other than the Minister of Finance and those surrounding him, had private information on the budget to which they were not entitled and therefore it is a breach of privilege for every member of this House. It must be dealt with in that way as a most serious matter.
I would suggest, with all due respect to the Chair, that if the government and members on all sides of this House are willing to put up or shut up, as someone said, they would be glad to refer this to a committee and have it examined there.
As was pointed out by my colleague from Newfoundland, if it is found that there is no breach of privilege, then the ministers will be very happy. If it is found that there is a case of privilege, then the ministers will be dealt with. Let the chips fall where they may. I think we have every right to expect our privileges to be upheld and that this matter will be thoroughly investigated from top to bottom as soon as possible.


Mr. Ian Deans (Hamilton Mountain):: Madam Speaker, this is a matter which is extremely serious, and to find an appropriate way to deal with it is very difficult, as I can appreciate. However, there is a series of conflicting statements which cause at least this hon. member to have serious doubts about what we have before us at the moment. I am concerned that, in fact, if one were to look at all the statements which have been made by the minister since yesterday regarding the matter raised initially by the hon. member for Leeds-Grenville (Mr. Cossitt) and subsequently by the hon. member for St. John's East (Mr. McGrath), one could come to the conclusion that there were areas of conflict.
As I understand, the minister has indicated that the information he obtained by virtue of a briefing given to him and to other members of the cabinet by the Minister of Finance (Mr. MacEachen) was not relayed by him to anyone until after the Minister of Finance rose in the House at eight o'clock. However, there is a statement attributed to the minister responsible for housing which would indicate that his officials began to prepare the ad at five o'clock and that they worked from five o'clock through the night preparing the advertisement.
I would ask Your Honour to consider whether it is a breach of privilege for a minister to advise anyone at all, even his staff who are not sworn to an oath of secrecy, concerning information contained in the budget which has not yet been put before the House of Commons and which could conceivably be of value to private citizens were they apprised of that information in advance of the budget being handed down.
It may well be that Your Honour will find that there is no privilege based on the fact that there is nothing in Erskine May, in Beauchesne or in the rules of the House of Commons to indicate that there is a need or a requirement for budget secrecy. However, the tradition and the convention has always

November 18, 1981
Privilege-Mr. McGrath
been that no detail of the budget should be revealed by the Minister of Finance or by anyone who had knowledge of it as a result of a briefing to anyone outside of the cabinet in advance of the budget being publicly presented. I suggest that although, in a technical sense, it may be very difficult to find the exact privilege which is being offended, there is no doubt in my mind that if that information was, in fact, given-and certainly the statement of the minister responsible for housing would indicate that it had been given-to people who were not sworn to any oath of secrecy by virtue of their position in the government, then a very serious wrong has occurred. That wrong must be remedied.
I would ask Your Honour to consider whether, in remedying that wrong, it may not be possible to find that there is a privilege which has been historically accepted, namely, the privilege of Members of Parliament to be the first to hear the budgetary proposals of the government before the government makes them available to any other individual in the land.


Madam Speaker:: Could the hon. member help the Chair by explaining whether he feels some information has been divulged which would affect the country? I can very well see that if there had been a breach of secrecy of the budget, the country might have been damaged. Perhaps that is one of the reasons we have this convention to which the hon. member has referred. If someone did not follow that convention, I can very well see that the country, the economy, or someone out there might have been damaged by the fact that secrecy had been breached. However, where was the privilege of an hon. member breached in this particular circumstance, if it has occurred at all? In what way has an hon. member been prohibited from functioning as a Member of Parliament in this House? That is exactly the answer I would need. Evidence of this particular situation would help me to find a prima facie case.


Ian Deans: If I may, I would suggest to the Speaker that perhaps consideration must be given to the rights of an hon. member to have the information made available to him or to her in the House of Commons at least no later than it is available to a private citizen, inasmuch as each individual Member of Parliament has a responsibility to protect the interests of the constituents who have elected that Member of Parliament to sit in the House of Commons. Therefore, each constituent of every hon. member is entitled to believe, and to have held as true, that his Member of Parliament has the information available to give to him at the same time as every other citizen of the land is given that information.
I believe that in fact it is my privilege as a Member of Parliament to be in a position to inform my constituents of matters which can and do affect their day to day lives at the same time as every other hon. member is made aware of that same information; and that if that information is inadvertently or deliberately given to one single individual who can benefit from it to the exclusion of all other individuals whose rights are protected by virtue of electing an hon. member to the House of Commons, that privilege has then been breached.


Hon. Erik Nielsen (Yukon):: Madam Speaker, I wish to refer the Chair to some precedents which I think will be of assistance in coming to a judgment on this very serious and very important question. Perhaps not since this Parliament began has there been a need to exercise such great care as that required in coming to a decision on the question which has now been put before the Chair by the hon. member for St. John's East (Mr. McGrath). Because it will arise during the discussion of the precedents I intend to cite, it might be well to refer to the motion that the hon. member for St. John's East read to the House in his closing remarks which reads:
That the advertisement which appeared in the Brockville Recorder and Times on the morning of November 13-
The following are important words with respect to specificity:
-over the authorization of the minister responsible for housing-
That is quite specific. It goes on to state:
-contains budgetary information-
That is quite specific.
-which was in the hands of the said Brockville Recorder and Times prior to the reading of the budget in the House on November 12, 1981.
That is quite specific.


Paul James Cosgrove: No, no. Wrong!


Erik Nielsen: It may well be wrong. There has been an interjection from the hon. member in the back bench there. I forget his riding.


Mr. Hnatyshyn:: No, it is the minister.


Mr. Blais:: It is the minister.


Erik Nielsen: Was it the minister? Oh, well, it was the minister himself. It may well be wrong, but I will make submissions with respect to the need to be specific. I believe the Chair made a reference to that necessity yesterday. Those specifics are in the motion, and I want to preface my remarks by making that submission to the Chair.
In my submission, I think there might be some confusion developing. Certainly, it seems to be apparent in the mind of the Parliamentary Secretary to the President of the Privy Council (Mr. Smith), and I hope that I might be helpful in clearing up that confusion.
In order to put the matter into proper perspective, may I refer the Chair to Hansard of December 6, 1978, at page 1857, where Mr. Speaker Jerome was ruling on a submission by the hon. member for Northumberland-Durham (Mr. Lawrence) that a contempt of Parliament had occurred as a result of an obstruction of his individual right to perform his responsibility as a Member of Parliament, and hence the collective right of all Members of Parliament. That case revolved around the presentation, in response to a question by that hon. member, of misleading information, to say the very least. Mr. Speaker Jerome on that occasion, in discussing what was a prima facie case had this to day:
November 18, 1981

May I, once again, reiterate the consequences of that decision.
That is whether or not Mr. Speaker was to find, as he did, a prime facie case. Mr. Speaker continued by saying:
The job that I have in matters of privilege is a preliminary, procedural review of the matter to determine whether in fact it touches the privileges of members of the House of Commons or of the House itself. Having done so, I concluded that the motion put forward by the hon. member must therefore be given immediate priority and taken into consideration by the House at once.
Here follow the rather important words, Madam Speaker. The paragraph concludes:
The House itself makes the decision on whether the motion shall carry, whether it shall be amended, or in any way altered and, in fact, whether there is a contempt. I do not make that decision; the House does.
In another precedent which can be found in Hansard for March 21, 1978, we find at page 3975 Mr. Speaker Jerome dealing with a question of privilege raised by the then hon. member for Nickel Belt, Mr. Rodriguez, no longer a member of the House. That matter had to do with an allegation by one Warren Hart, which allegation had been made in a sworn affidavit relating to electronic surveillance of members' telephones. The member said that act constituted a breach of privilege if true, and Mr. Speaker Jerome had this to say:
In this connection I wish to refer the House to some excellent language contained in the Report of the Select Committee on Parliamentary Privilege dated 1967, in the United Kingdom. I have the reference here and I will table it with my notes today for the benefit of the reporters. The document is dated February 20, 1967, and I call attention to the following passage which appears on page 111:
From this circumstance it might be inferred that the test applied by the Speaker in deciding whether to give precedence over the orders of the day to a complaint of breach of privilege-or rather to the motion which the member who has made the complaint desires to move in reference thereto-is, does the act complained of appear to me at first sight to be a breach of privilege? Rigorously applied, it would mean that no complaint of breach of privilege could ever be entertained unless the Speaker was of the opinion that the act or conduct complained of was a breach of privilege.
I draw attention to the words, "was a breach of privilege", a substantive decision. Mr. Speaker Jerome continued reading from this document dated February 20, 1957 as follows:
The result would be that the House which alone is competent to decide whether a particular act is a breach of privilege-
It is not the responsibility of the Chair. The passage from which Mr. Speaker was quoting concluded as follows:
-would have no opportunity of deciding the question unless the government ga,ve time for its discussion. Borderline cases and arguable ones would be excluded automatically because in such cases the Speaker could not say that he was of opinion that the act or conduct which was the subject of complaint prima facie constituted a breach of privilege.
Mr. Speaker Jerome then said:
I ask hon. members to note the phrase "which alone is competent to decide".
He was referring to the House being competent to decide. Mr. Speaker Jerome continued by saying:
That is the point I wish to stress. To continue quoting:
In my submission the question which the Speaker should ask himself, when he has to decide whether to grant precedence over other public business to a motion which a member who has complained of some act or conduct as constituting a breach of privilege desires to move, should be, not-do I consider that, assuming that the facts are as stated, the act or conduct constitutes a breach of privilege,
Privilege-Mr. McGrath
but could it reasonably be held to be a breach of privilege, or to put it shortly, has the member an arguable point? If the Speaker feels any doubt on the question, he should, in my view, leave it to the House.
That is the position in which I find myself here. In all the circumstances, I hesitate very much to take away on procedural grounds the possibility of reaching a decision on a subject to which the House might wish to address itself.
I might parenthetically say, even those ministers on whom doubts are cast. Mr. Speaker went on to say:
In debating the motion put forward by the hon. member, members of the House might make valuable contributions to the question of whether or not we should treat this kind of electronic interference in some special way. Indeed, if the House decides in its wisdom that the matter should be referred to a committee for consideration, the committee hearing might result in an indication of the proper attitude which should be taken toward the matter.
Therefore, on balance, in the special circumstances which exist here, it is my conclusion that I should resolve my doubt in favour of putting the question to the House at the proper time.
That is what Mr. Speaker did on matters of privilege upon which he had a doubt.
At this point, Madam Speaker, may I submit to you, with great respect, that it is not the function of the Chair to insist upon that degree of evidence which, in criminal trial, would result in a conviction of an accused person. All that is necessary here, in my submission, is that some evidence be submitted upon which the Chair can make a valued judgment as to whether a question of privilege exists, and, if it exists in that very shallow sense of prima facie-and that in effect is what prima facie means-some evidence to warrant and explanation or some evidence in a criminal court that would require a defence, in the absence of which a conviction would be registered. That, I suggest, is the proper meaning to be attached to the words prima facie. All the Chair requires is that some evidence be before it, not a preponderance of evidence. Of course, it has to be privilege, to which I will speak in a moment.
A further precedent is to be found in Hansard dated June 7, 1977, at page 6388. Just to digress for a moment for the edification of the Parliamentary Secretary to the President of the Privy Council, and indeed of the President of the Privy Council (Mr. Pinard) himself who spoke about it yesterday, as did the hon. member for St. John's East (Mr. McGrath), I am speaking of this myth, "Make a charge and put your seat on the line, and if you do not justify the charge, you lose your seat." That is utter nonsense. It has no place in our precedents. It has no place in our practices.


David P. Smith: Tradition.


Erik Nielsen: That finding has been upheld by Speaker after Speaker in the House, and by a Speaker for whom I am sure all members in this House have the greatest respect. I am referring, of course, to your predecessor, Mr. Speaker Jerome who interrupted one of your deputies, the hon. member for Lachine (Mr. Blaker) who in 1977 was parliamentary secretary to the minister of supply and services. He said in essence exactly what I have just finished saying with respect to this business of putting a member's seat on the line. At page 6388 of Hansard Mr. Speaker Jerome said this:
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November 18, 1981
Privilege-Mr. McGrath
I might case the hon. member's mind on that. There is no confusion on that point; that question is clearly settled. The question whether or not a charge has to be laid in order to get a matter before a committee is a totally different question; but there is no precedent at all which supports the thesis that a member, by making such a charge, puts his seat on the line or that he has to put his seat on the line in order to make such a charge.
That should dispose once and for all, of that particular point, at least in this session of Parliament.
The next precedent-and I do hope these precedents will be helpful to you, Madam Speaker-is to be found at page 742 of Votes and Proceedings for July 25, 1975. This is again a ruling by Mr. Speaker Jerome, I believe. I am not quite sure when the change of Speakers took place. This precedent deals with the matter of the specific charge. Indeed, there can be no doubt it seems, on the basis of the precedent, that a specific charge must be laid in order for there to be constituted a question of privilege and, more important, in order that the committee might be focused accurately on the work it has to do if the House should send the question to the committee. To quote very briefly, he said:
I do stress after all that it is in the final analysis a decision of this House which will say whether or not the matter goes to the Standing Committee on Privileges and Elections where the matters that have been discussed and raised by almost all Members who have participated will be possible.
That involved the question raised by the hon. member for Kenora-Rainy River (Mr. Reid). It is interesting to point out that the hon. member for York-Simcoe (Mr. Stevens) and the hon. member for Oshawa (Mr. Broadbent) also put forward motions to send that particular matter to the committee, as did the hon. member for Kenora-Rainy River.
The hon. member for St. John's East has already pointed out the importance of referring the Chair to the amendment to that motion which was moved by the hon. member for Oshawa, and that amendment too was accepted and included in the reference to the House.
Having referred the Chair to that precedent, may I once again refer the Chair to the specific nature of the motion moved by the hon. member for St. John's East. There are three very clear specifics in that motion: That the advertisement over the authorization of the minister responsible for housing-that is specific number one-contained budgetary information

that is specific number two-and that that information was in the hands of the newspaper prior to the reading of the budget in the House on November 12, 1981-and that is specific number three. Nothing, in my submission, could be more clearly specific, and more closely meet the criteria of which Mr. Speaker Jerome spoke in the precedent last cited.
Let me now bring to your attention another precedent taken from Hansard of April 17, 1978, at page 4549. Again that was a question of privilege raised by the hon. member for Oshawa-Whitby on alleged leaks of budget details. Again it was Mr. Speaker Jerome who was in the chair. Again that ruling focused on the need for specifics. I will just quote one short sentence from that ruling of Mr. Speaker Jerome where he said, as reported at page 4549:
General motions of that sort without specific accusations, have been rejected by the Chair. Therefore, even if I were to accept the fact that these precedents place this matter within the area of privilege-
He went on from there. In that case, even if he had found privilege, which he would not have, he found that the motion itself lacked the specific nature he and other Speakers before him had set up as necessary criteria to find a privilege. That, however, is not the case here in my submission, having regard to the three specifics mentioned a moment ago.
The last precedent I wish to cite with respect to the records of this House is in Hansard of December 12, 1979, at page 2283. I ask you, Madam Speaker, to take particular note of the date, because those who now argue against the submission we make on this side were then here. I want to quote a few remarks of some members who now sit over there; one is now the Minister of Justice (Mr. Chretien). He has been here for some time and certainly is interested in justice, impartiality, truth and fairness in this place, and I do not say that in any insincere way. He said, as reported at page 2283:
The confidentiality in which the details of a budget are kept is a constitutional practice which forms an integral part of a parliamentary system. Such practice is based on the principle that no individual, whoever he may be, must know in advance the details of a budget which he could use for personal gain.
He went on at page 2284 to tell us he was at one time minister of finance and he appreciated the difficulties that would be encountered in keeping budget secrecy. He spoke of consulting with the provinces but at the same time ensuring that he maintained that constitutional practice of, as he called it, budget secrecy. He said:
-but I always kept in mind the responsibility which I had in terms of budget secrecy.
On the same page, a little further down in the right hand column, referring to the Minister of Finance and his responsibility, he said:
He is forced to conduct those consultations in order to have a budget document prepared. Sometimes he has to consult with the department and so on. He has the responsibility of making sure that there is absolutely no leak.
At page 2285 he said:
I have absolutely no choice but to raise this fundamental problem of parliamentary democracy. When we have a government that is responsible to this House, the Minister of Finance has to take all the necessary steps to ensure that there is absolutely no leak.
That is a responsibility the present Minister of Justice points out that the Minister of Finance owes to the House. Therefore I emphasize the nature of that opinion of the present Minister of Justice in terms of what the privileges of this House and its members are.
The Minister of Justice said also:
-1 realize that the hon. minister has no choice but to reveal to the House what happened. In order to help him to clarify the question of whether there was a leak-
Note the words "whether there was a leak"; there is nothing specific about that. The quotation continues:
-and I think there was a leak-in my judgment he will have to take his responsibility in the best British tradition.
November 18, 1981

Those are not my words, those are the words of the present Minister of Justice who made a very learned contribution to that question of privilege when it was raised in December 1979. This has not happened here, but what disposed of the question raised on that occasion was the then Minister of Finance rising in his place and saying these words, and I quote from page 2285:
But just let met say on a factual basis that there has been no budget leak. There was certainly no budget leak for which I am responsible. There was no budget leak from the Department of Finance. There was no leak, period.
That is the crux of the matter and that is what Mr. Speaker Jerome then hung his hat on when he decided that question.
The hon. member for Kenora-Rainy River, who is still in the House, made a contribution to that question of privilege as well, and I will just quote one passage from his contribution. He said, as reported at page 2286:
I think we could have an argument as to whether in point of fact budgetary leaks did take place as alleged by the hon. member for Saint-Maurice, but that would be the job of the standing committee to decide.
That particular member, who has been here and served in a very distinguished capacity for many years in the cabinet and outside, but particularly on the Standing Committee on Privileges and Elections and on the committee on rules and procedures, went on to say:
What is important is the fact that the hon. member for Saint-Maurice has brought forward some evidence-
Precisely the phrase that describes what a prima facie case is.
-to indicate that, indeed, a great deal about the budget was well known before the budget was presented to the House of Commons.
These words may be coming back to haunt members such as the member for Kenora-Rainy River and the now Minister of Justice. But I agree with them. They were accurate and they were correct, that budget secrecy is not only a mere convention, it is a constitutional practice, as was so correctly described by the Minister of Justice when he was here. The nature of a prima facie case was so accurately described, the requirements thereof and the criteria thereof, by the member for Kenora-Rainy River.
I do not intend to quote at length from the next and last precedent I wish to cite for the consideration of the Chair. It is a parliamentary paper prepared for the House of Commons Standing Committee on Privileges and Elections in 1975. It provides background information on government secrecy, financial measures and parliamentary secretaries. It is the financial measures portion of the paper to which I wish to refer the Chair, and it is dated August 8, 1975. In reading that paper, Madam Speaker, you will find it clearly indicates that indeed it is a constitutional practice, that there are sound reasons for budgetary secrecy. It goes a long way toward answering the question which the Chair put to the hon. member for Hamilton Mountain (Mr. Deans). The paper says:
The reason for such secrecy is obvious: advance knowledge of Fiscal measures could result in Financial speculation and the loss of revenue to the government
Privilege-Mr. McGrath
treasury. Illicit proFits could be made by those persons with prior knowledge who are not bound by moral or other controls. Today, the budget is not delivered until the stock markets have closed across the country.
The committee cites a book by an ex-minister of finance, Mitchell Sharp, now chairman of the Northern Pipeline agency, where he said:
Up until 1941, the Canadian practice was to present the budget in the afternoon.
He goes on to say why it is not now presented until after the markets have closed. That paper is important in considering what decision the Chair has to come to here.
I submit that in essence, Madam Speaker, the Chair has before it a case of privilege. Why? To cite the Minister of Justice, "the responsibility owed by the government to the House with respect to maintaining secrecy in budget matters ..." Those are his words, not mine, that the government owes that responsibility to the House, and hence its members. Those last words are mine, parenthetically. The House is the sum total of us all. Therefore, it is a matter of privilege.
My second point is that there is sufficient evidence before the Chair to constitute a prima facie case. In the words of precedents cited to the Chair in rulings laid down by Mr. Speaker Jerome and his predecessors, "All that is required is some evidence." Well, certainly there is that degree of material before the Chair as to constitute "some evidence," thereby constituting a prima facie case. The next step, therefore, having regard to the specific nature of the motion, is only to decide whether it is sufficiently specific. That is a decision the Chair will have to make, in my respectful submission.
I have twice pointed out three specific allegations that are present in that motion, and certainly it cannot be regarded as general. That element is met in the necessary criteria. The next step, may it please the Chair, is for the House to find now that there is a prima facie case and then to put the motion. The government is free to do what it wants with the motion. If it wants to vote it down, that is fine, and it will probably do that and shorten the whole process. But in my respectful submission there is sufficient evidence for the Chair to put that motion to the House because it is only the House which can decide, with great respect to the Chair, whether or not there has been a breach of privilege.
Again, the Chair does not have to go nearly that far. All the Chair has to do is to find that there is some evidence which justifies the presentation of the motion to the House.
I regret having taken so long, but I thought these matters should be thoroughly exposed because of the important nature of the submission of the hon. member for St. John's East.


Some hon. Members:: Hear, hear!


Madam Speaker:: I thank all hon. members who have tried to enlighten me in deciding on this particular case. It is obvious from the numerous interventions we have had that it is a matter of very great importance to the members sitting in the House.

November 18, 1981
Privilege-Mr. McGrath
I wish to remind hon. members that I am quite aware of my duties with regard to deciding a question of privilege. I also know what my limitations are concerning a decision on a question of privilege.
I know that I must ask hon. members, and probe them in the course of their interventions, to help me to find where privilege has been breached, and that I must only declare that I have found, on the face of it, that there is a privilege. The House is only obliged to determine whether privilege has been breached. I want to reassure hon. members that I am very much aware that that is my duty and that there are limitations to that duty.
The hon. member for Yukon (Mr. Nielsen) has given me quite a lengthy series of precedents which would be helpful, I am sure, if I found that we were dealing with privilege. All the precedents he has invoked deal with what happens if the Chair finds a question of privilege to exist. It is very useful that the House be reminded of these precedents once in a while, but I am sure the hon. member will realize that what is important to me is to have this breach of privilege defined so I will know in what way a member of this House has been prohibited from functioning in this House as a member. Has he been free to speak? Has he been molested or threatened or bribed in any way that would prevent him from expressing himself freely in this House on any matter, be it legislation or an occurrence such as we have been discussing today? I do not believe any member has attempted to show me that he has been unable to perform freely and to say what he wanted about this particular case. The decision is somewhat more difficult for the Chair if hon. members do not concentrate on defining exactly what that privilege is and where it has been breached.
In my view, the most important aspect of this problem is that we are not dealing here at all with privilege. I did say that yesterday, and in the course of the day I did reflect upon it and studied the precedents which were invoked and other precedents which had been brought up to me. Certainly the matter of budget secrecy is not dealt with through questions of privilege and there are very important precedents which I will recall to hon. members. There were cases in Great Britain, the ones concerning Mr. Thomas and Mr. Dalton where there was an allegation of breach of secrecy. They were not brought before the House under privilege. Nor were they dealt with under privilege. A committee was set up in one case, and a tribunal was set up in the other. Neither case was brought before the committee which normally deals with matters respecting the privileges of members. In one case there was a special committee which dealt with a particular matter; in another case there was a tribunal. This was necessary because of the special powers which are needed to investigate such cases.
Those two important precedents which I took from the records of the United Kingdom convince me-and, I hope, the House-and give me the authority to say that a breach of budget secrecy cannot be dealt with as a matter of privilege. It might constitute a very important grievance for members.
Such action might have a very negative impact on business or on the stock market. It might cause some people to receive revenues which they would not otherwise have been able to obtain. All of these are possible consequences of breaches of budget secrecy, but they have no impact on the privileges of a member. They might do harm-irrevocable in some cases-to persons or institutions, but this has nothing to do with privilege. It has to do with the conduct of a minister in the exercise of his administrative responsibility.
I must repeat that if hon. members feel that the incidents which have been discussed in this House for two days now are reprehensible, that they have to do with the conduct of a minister in the exercise of his administrative responsibility, it is in that respect that a formal charge must be made. That charge must allege that a minister has been derelict in his administrative responsibility, has breached his oath or whatever hon. members might want to allege. That is the way to deal with the matter if members feel that a minister-or a member, for that matter-has been derelict in the exercise of his administrative responsibilities. That is why I indicated yesterday that if hon. members wanted to deal with that, it was not by way of question of privilege but by a formal motion in which a charge would be made.
The hon. member for Yukon says that the kind of charge which is necessary when one wants to cast blame on a minister or a member for his conduct has nothing to do with our precedents. However, I must tell him that there are numerous precedents. In the Pallett case in 1959 Mr. Speaker Michener said quite categorically that a charge would have to be made in the form I have just indicated because it is quite obvious that accusations cannot be spread around or directed at members of this House or ministers without being backed up by proper facts. Otherwise we get into a considerable fishing expedition and allegations not substantiated but which cast doubt on the performance or reputation of a member. That, of course, cannot be allowed because members can sit in this House only if they are considered to be honourable members and the Chair has to protect that reputation of being honourable. The rules exist precisely to assist me in protecting that reputation. If the House consisted of members who were not honourable, then obviously the House could not be honourable.
I must respond to another series of arguments. Members have said that this case is similar to the question of privilege once raised by the hon. member for Kenora-Rainy River (Mr. Reid), but I must indicate that I do not think this case is at all similar, even though it does deal with the matter of budget secrecy. Hon. members will recall that the precedent with regard to the hon. member for Kenora-Rainy River had to do with a motion the hon. member himself proposed. That motion dealt with his privilege, not with the allegation that budget secrecy had been breached. The hon. member felt that his privilege had been affected because he was accused of dishonourable conduct for a member in relation to his responsibility as a member. That is what constituted the question of privilege. He felt that his reputation was at stake and was in question because a newspaper had made an interpretation of
November 18, 1981

something he allegedly had done. Ele was alleged to have been privy to budget information and to have conveyed that information to businessmen.
Much was made of the amendment which was brought in by the hon. member for Oshawa (Mr. Broadbent) and of the fact that it and the motion had been voted on by the government as well as by the opposition. I suggest hon. members read that case very thoroughly. If they do, they will see that the amendment was brought to clarify the motion. It was somewhat of a rewriting of the motion and was designed to describe more fully the nature of the accusation which might have been studied by the committee if it had been referred to the committee. That was the purpose of the amendment.
What this particular precedent says to us is not that breaching budgetary secrecy is a question of privilege but that the hon. member for Kenora-Rainy River had a question of privilege because he had been accused by a newspaper of breaching budgetary secrecy and doing something dishonourable in the exercise of his function. That is the important point which has to be considered in this case.
I must repeat that the protection of privilege has to do with the protection of the capacity of hon. members to function as members in this House. If we are dealing with the wrongdoings, conduct or behaviour of a minister or the methods used by a minister of which some hon. members do not approve, that does not constitute a question of privilege, although it might be of great importance to the hon. members concerned. It is difficult for me to deal with such matters as questions of privilege.
I think that is a summing up of the arguments, and I must conclude that I cannot find a prima facie case of privilege. If hon. members want to deal with the matter in another way, there are avenues open to them, and I invite them to follow those avenues, if they feel that they can substantiate whatever allegations they wish to advance.


Hon. Marcel Lambert (Edmonton West):: Madam Speaker, I rise on a question of clarification. During the course of the debate yesterday and in remarks Your Honour has addressed, particularly in dealing with the laying of a charge, there has been bandied about, not only this time but on numerous occasions in the past, what I think is a pure canard, and that is that he who lays the charge puts his seat in jeopardy. When the charge is laid before a partisan committee, that is total and utter nonsense. That has crept in, perhaps, because of bravado by way of a challenge. There is no substance whatsoever with regard to such a procedure in this House.


Madam Speaker:: That has to do with members themselves. I do not find anything contained in the Standing Orders that would allow me to rule that if someone made a formal charge of this nature to the House, and if it is found that the charge is unfounded, then that member would have to resign. Yesterday I did rule that this was a matter of personal ethics. If one feels his credibility has been destroyed by an incident in the House,
Privilege-Mr. Speyer
then he is free to take whatever action he feels justified in taking in the circumstances.


Erik Nielsen: Madam Speaker, I rise to clarify a point. The Chair probably used the words in the ruling because of the failure to appreciate the refinements of my argument. At no time did I say in my submission to the Chair that there need not be specific allegations; indeed, I did say the contrary. I pointed out three specifics in arguing my case that were inherent, in my submission, in the motion. At no time did I specifically say that the allegations were not necessary. I agree with the Chair on that point. I have to agree with Your Honour anyway because you made the ruling.
What I did say, and what was referred to by the hon. member for Edmonton West (Mr. Lambert) is that there is no requirement for a member to put his seat on the line if he makes specific allegations. Perhaps that was lost in the beauty of my argument.


Madam Speaker:: The hon. member's point is well taken.


MR. SPEYER-ALLEGED MISLEADING ANSWER GIVEN BY MINISTER
Chris Speyer: I have a short but important question of privilege. I am pleased that the Minister of Finance (Mr. MacEachen) is present in the House because my question of privilege relates to a misleading statement made by the minister during question period. I hope it was inadvertent. I shall deal with the matter very briefly.
I asked a supplementary question of the Minister of Finance. The substance of the question was that the federal government over a three-year period would raise $2 billion as a result of the limitation of the capital cost allowance system. As I understood the answer by the Minister of Finance-and I am pleased to see that the minister is present in the House-he said that not one dime will flow to the government.
In the budget that was tabled in this House last Thursday evening, November 12, and the statement which is contained on page 4 of the budget-


Madam Speaker:: Order, please. Will the hon. member please resume his seat? If the hon. member has a question of privilege, he must talk about the privilege and not continue to discuss the matter which was raised during the course of question period. I believe the hon. member is about to debate the question. The fact that the answer is not satisfactory to the hon. member does not constitute a question of privilege, I must remind him. If the hon. member has a different matter to raise, I will hear him with regard to that.


Chris Speyer: My question of privilege relates to the misleading answer that was given by the Minister of Finance on the budget papers.
The Chair must give me the opportunity, I say to you, Madam Speaker respectfully, to point out exactly the accuracy of my assertions, and I would be delighted-

November 18, 1981
Privilege-Mr. Wright


Madam Speaker:: Order, please. The hon. member is debating the question. I want to caution the hon. member when he says that he has been misled. That has to be qualified. It is a serious allegation to say in the House that a minister has deliberately misled the hon. member. The hon. member did not say it. The first time the hon. member said "inadvertently" and the second time the hon. member did not say "inadvertently", but I am sure that the hon. member did want to say "inadvertently". I want to caution the hon. member because on two occasions I was about to rise to my feet to caution him. That is what I am now doing.
If the hon. member feels that the answer he received is not satisfactory, then the hon. member may ask the question during question period tomorrow or in subsequent days to try to elicit a more satisfactory answer. However, this does not constitute a question of privilege.


Hon. Sinclair Stevens (York-Peel):: Madam Speaker, in view of the fact that we do have this apparent misstatement on the record, and because the Minister of Finance is present in the House, I wonder if the minister could be given an opportunity to explain why he feels his answer was accurate or not, in keeping with the documents that were filed on budget day.


Madam Speaker:: Order, please. No. The minister may have an opportunity at another time but not now.


MR. WRIGHT-NOTICE OF QUESTION TO BE RAISED
Mr. Bill Wright (Calgary North):: I did give notice to the Chair earlier today with regard to my question of privilege. I rise on this question of privilege to question my inability to deal with my constituents relating to the Minister of Supply and Services (Mr. Blais)-


Madam Speaker:: Order, please. Will the hon. member resume his seat? I had almost forgotten the notice of the question of privilege that the hon. member provided to me. I must tell the hon. member the notice did not contain the statement that is required by the Standing Orders and, therefore, the hon. member would have to renew that notice and provide the Chair with a statement of the matter he would like to raise as a question of privilege. The hon. member did not do that in his notice. I have to be very straightforward with regard to that point because the Chair must have the opportunity to look into the matter in advance so as to prepare a possible ruling and to cite references that may be necessary for that ruling. It is normal courtesy to provide this information to the Chair and, at any rate, it is required under the Standing Orders.



ROUTINE PROCEEDINGS


Allan Joseph MacEachen: Madam Speaker, as I indicated to the House leaders, I will advise the House that I will be issuing a press release after the stock markets close on the subject of mergers and corporate reorganizations establishing certain transitional rules, as these have been affected by budgetary action. I am giving notice to the House because it is a budgetary matter. I cannot release the details now, until the stock markets close, but I will do that later.


Michael Holcombe Wilson: I am amazed that the minister would make the same mistake two days in a row. The minister has just made the statement that he will make some announcements with regard to transitional rules on mergers and acquisitions. It is clear to anyone in the marketplace that the company involved is Dome Petroleum Limited with regard to the proposed merger with Hudson's Bay Oil and Gas Company Limited. It is incredible that the minister would make this statement after he made the same mistake yesterday of announcing while the markets were open that the rules would change with regard to MURB, which caused an increase in the share price of those companies involved with MURB. I think the minister would have learned from his previous mistake. It is incredible for the Minister of Finance (Mr. MacEachen), who has been in this House and in this position for a long period of time to make the same mistake twice. I should think the minister would demonstrate better judgment than that.


PETITIONS
Mr. Bob Corbett (Fundy-Royal):: I present herewith a petition of over 1,400 names to be added to the 19,000 names that I laid upon the table of Canadians who are requesting that passenger rail service in this country be restored.
These people are asking that the government and, in particular, the Minister of Transport (Mr. Pepin) not isolate mothers from sons and daughters, husbands from wives, the elderly from comfort and warmth, and exhibit an attitude of kindliness and understanding to replace that of a demented slaughterhouse butcher.


Hon. John Wise (Elgin):: Earlier today I had the opportunity to personally present a list of 250 protest letters to the Prime Minister (Mr. Trudeau). I now have the very unpleas-
November 18, 1981

ant task but the responsibility and duty to table in this House a petition signed by 5,786 citizens of the city of St. Thomas, in the county of Elgin, namely my constituency of Elgin. This petition reflects the resentment and the anger of Elgin constituents. I am certain, in turn, it reflects the attitude of Canadians everywhere regarding business failures, loss of family homes, farm bankruptcies and foreclosures which are a direct result of the government's high interest rate policy.


Sinclair McKnight Stevens: Madam Speaker, I wish to present a petition on behalf of 205 York region residents. These people are gravely concerned about the threat posed by import competition to the leather and shoe industry which is an important source of jobs in the area. They feel action must be taken right away if this industry is to be saved, and that global import quotas, limiting total shoe and leather imports, will keep their jobs in these communities. They urge the Government of Canada to establish and maintain an effective quota system to protect the industry from unfair import competition.


Erik Nielsen: Madam Speaker, I have the duty to present a petition on behalf of my constituents. The purpose of this petition, signed by 250 Yukon workers, is to indicate to the government that the removal of the moratorium on taxation of northern benefits would be devastating.
The nature of the demand is the continuation of the current moratorium on the taxation of northern benefits to block the tax grab of the government; for the government to adopt a permanent policy to exempt from taxation all special allowances paid to workers in northern and remote areas of Canada, including but not limited to, transportation allowances, housing allowances, meal allowances, northern allowances, special vacation benefits and cash allowances; and for the government to meet with the Canadian National Directors of the United Steelworkers of America for the purpose of hearing the said Canadian National Directors of the United Steelworkers of America on behalf of the over 10,000 Canadian steelworkers who work and live in isolated communities.
The petitioners hope, Madam Speaker, that in your examination of their petition you will find the petition to be in order, sense the urgency and desperation of their plea, and that you might use the discretionary powers vested in your office to allow discussion and referral to committee at the earliest possible moment.
* *
*


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Order Paper Questions
Mr. Antonio Yanakis (Parliamentary Secretary to Minister of Labour):: Madam Speaker, the following questions will be answered today: Nos. 1,515, 2,633 and 3,257.
I ask, Madam Speaker, that the remaining questions be allowed to stand.


Mr. Mazankowski: 1.	Is the Canadian National Railway cutting staff in its car and equipment departments and, if so, how many persons will be cut in each province?
2.	Are such persons involved in inspection, repair or maintenance of equipment and, if so (a) how many (b) how will current rail safety levels be maintained, let alone upgraded, with less personnel?
3.	Was the Minister of Transport in contact with the CNR with respect to the cuts and, if so, what were the results of the discussions?


Mr. Robert Bockstael (Parliamentary Secretary to Minister of Transport):: The management of Canadian National Railways advises as follows:
1.	In May and June 1980, through a combination of attrition and lay-offs, a reduction of 511 positions occurred in the number of staff associated with the freight car repair activity.
Province
Nova Scotia
Prince Edward Island
New Brunswick
Quebec
Ontario
Manitoba
Saskatchewan
Reduction of positions
5
158
131
511
At that time the railway was experiencing a significant decrease in rail traffic which resulted in a reduced demand for freight cars. Cars needing repairs and not required to handle the traffic offered were placed into the stored surplus category.
2.	The affected positions concerned repairs to freight cars, (a) 511 positions in the freight car repair activity, no positions regarding car inspectors, (b) As car inspector positions were not involved, car inspection activities continued to receive high priority.
3.	The Minister of Transport was in contact with the railway, was informed of the underlying causes, and was assured that in taking such action Canadian National would continue to ensure a safe and efficient operation.


Mr. Cossitt: 1.	With reference to the reply to question No. 2,217 which stated in part "it has not been customary to require the CBC to provide such details of its internal management and administration" (a) on how many occasions was a similar reason given in answers to questions on the Order Paper concerning the Canadian Broadcasting Corporation (b) what were the exact words of the first question which gave such an answer, including the full answer to the question and the date of the answer?
2.	On what date did the corporation come into existence and how long after that date was this "custom" instituted with regard to the answering of questions?

November 18, 1981
Order Paper Questions


Mr. Jack Masters (Parliamentary Secretary to Minister of Communications):: I am informed by the Canadian Broadcasting Corporation as follows: 1. (a) and (b) See part 2 below.
2. The corporation came into existence on November 2, 1936. The custom developed from the earliest days of the corporation, and over the 45 years since the corporation's creation, Parliament has not required the CBC to supply, in answering parliamentary questions, certain details of its internal management and administration. The background to this custom is set out in detail in the reply to question No. 2,530, answered November 6, 1975.


Mr. Beatty: How many proposed regulations were examined by the Clerk of the Privy Council, as required by section 3 of the Statutory Instruments Act, in (a) 1980 (b) the first six months of 1981 and, for each period, how many proposed regulations were reported by the Clerk of the Privy Council to the regulationmaking authority involved on the grounds that they offended against the criterion in (i) section 3(2)(a) (ii) section 3(2)(6) (iii) section 3(2)(c) (iv) section 3(2)(d) of the act?


Hon. Yvon Pinard (President of the Privy Council):: 1. (a)
1,023, (b) 609.
2. None.


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


Sinclair McKnight Stevens: Madam Speaker, I was wondering whether the parliamentary secretary could inform the House as to why the government has declined to answer question No. 2,042 which was placed on the Order Paper on January 29. It is a simple question:
1.	What was the total cost of the Prime Minister's December-January world tour?
2.	What percentage of the total cost of the trip will be paid by the Canadian taxpayer?


Antonio Yanakis: Madam Speaker, I shall take notice of the hon. member's question and bring it to the attention of the minister.


Henry Perrin Beatty: Madam Speaker, I have two questions on the Order Paper which I should like to bring to your attention and that of the parliamentary secretary. I am quite perplexed as to why the House has not received responses. Question No. 2,644 was placed on the Order Paper on June 18 of this year. It asked whether or not the government was intending to issue a stamp in commemoration of the Royal Wedding. In view of the fact that the Royal Wedding took place some months ago, the government should be able to answer the question by now. Perhaps I should reword it to ask whether or not it will commemorate the birth of the firstborn of the Prince of Wales rather than the marriage.
Also I should like to draw to the attention of the parliamentary secretary question No. 1,439 which was placed on the Order Paper on July 11, 1980, some sixteen months ago. There are three parts to it. It reads:
1.	What was the government's total advertising budget for the fiscal year 1979-80 and what is the proposed budget for the fiscal year 1980-81?
Both of those fiscal years have come and gone, so the government should be able to answer. It continues:
2.	(a) What amount was spent by the government on French language advertising in Quebec during the referendum campaign period (b) to which creative advertising agencies were contracts awarded to produce such advertising (c) what was the value of the contracts signed by the creative agencies (d) were any of the contracts offered for tender?
The referendum was in May 1980; it came and went well over a year ago. The third part of the question is equally easy to answer if the government chose to do so. It reads:
Were government advertising contracts awarded for the fiscal year 1980-81 to the advertising firms (a) Vickers and Benson Ltd. (b) Ronalds-Reynolds & Co. Ltd. (c) BCP Advertising (1978) Ltd. (d) Jean Prevost Inc. and, if so, in each case (i) was the contract publicly tendered (ii) what was its value?
The reason I raise this is that it is particularly germane today. Those four companies joined together to create Canadian Media Corporation which has been on contract by the government for some $2,430,000. We discovered today that the minister responsible for housing has hired Vickers and Benson, one of those four firms, and given it additional work in placing ads, in addition to what was done by Canadian Media Corporation. This is why the House is entitled to some straight answers, and surely before now.
[ Translation]


Antonio Yanakis: Madam Speaker, I shall also take notice of the representations of the hon. member and convey to whoever is concerned and a report will be made to the House.


Antonio Yanakis: Madam Speaker, I ask that all notices of motions for the production of papers be allowed to stand.


Madam Speaker:: Shall the remaining notices of motions for the production of papers stand?


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Tuesday, November 17, consideration of the motion of Mr. MacEachen that this House approve in general the budgetary policy of the government, and the amendment of Mr. Wilson (p. 12752).
Hon. Pierre Bussieres (Minister of State (Finance)):: Madam Speaker, I am very pleased to have an opportunity to
November 18, 1981

take part in the debate on the budget that was brought down last week by the Minister of Finance of Canada (Mr. Mac-Eachen). It is important to remember, Madam Speaker, that the primary objective of this budget is to check inflation. Now, why should the government try to check inflation when interest rates are very high and the unemployment rate in Canada is quite substantial as well. Well, our objective is to fight inflation because inflation is what is causing high interest rates and the problems we are experiencing in our economy. To achieve this objective, the budget contains a set of measures that are based on the following three principles: restraint, equity and creating a climate or conditions that are favourable to economic and industrial renewal in our society.
What is in fact the first thrust of the budget? What about restraint? If we really want to fight inflation, an economic disease which could be compared to being grossly overweight, we must reduce our expectations and slow down the rate at which we spend our money. We feel that restraint must be applied by the government to its own spending, and it is being very strict in this respect. In this budget, the government is proposing to substantially reduce the growth rate of its expenditures. As a result, there will be a substantial reduction in the government's deficit during the next few years and also in the government's borrowing requirements on the capital market.
What does a reduction in the growth of government spending mean? In 1981-82, government expenditures showed a growth rate of 16.6 per cent. In 1982-83, this will be reduced to 11.7 per cent, which is less than the inflation rate.
In other words, if we look at the rates of inflation and of increase in government spending, we find that instead of increasing our expenditures as a government, in real terms, in real dollars, we are decreasing our expenditures. And what about the decrease in the deficit? The deficit for 1981-82 is $13.4 billion; the projected deficit for 1982-83 is $10.5 billion. So a reduction in the deficit means a decrease in financial requirements, a very substantial decrease in the government's borrowing requirements, from $9.8 billion, in 1981-82 to $6.6 billion, in 1982-83.


An hon. Member:: Good management!


Pierre Bussières: Mr. Speaker, earlier a member presented a petition concerning interest rates. By reducing its borrowing requirements by nearly $4 billion, the government will contribute to relieve the pressure on the capital market and thus bring about further substantial decreases in addition to those that occurred during the past months, that is, further substantial decreases in interest rates. There is tangible proof of the government's determination to fight inflation, in its commitment and ability to reduce its expenditures and deficit and to ease the pressure on the money markets by reducing its borrowing requirements.
During the past few days, some hon. members have made proposals, which would mean an increase in government
The Budget-Mr. Bussieres
spending. The government is being blamed for not doing enough to help home owners or some industries. It seems to me that members who make these representations should tell us how much money they think these measures would involve, how much assistance in terms of dollars the government would have to give, and where the money would have to come from. Would we get the money by cutting back even more on our spending? If so, let them tell us which programs would be cut back. Perhaps these members would like us to get billions of dollars by cutting off the indexing on family allowances? Would they prefer us to reduce indexing of old age security pensions or of the guaranteed income? This is another indication they should give us when they call for additional measures to assist the Canadian people. They should assess those measures and tell us where the money would come from.
The second thrust of the budget is equity, the great concept of equity. And this concern for equity is not through a substantial reform of some aspects of our taxation system. It is done by withdrawing certain preferences or privileges granted to some taxpayers. It is a progressive measure which especially applies to higher income brackets. Contrary to the Minister of Finance in Quebec who decided yesterday to adopt regressive measures such as taxing beer and gas, the Minister of Finance chose a more progressive position by removing some preferences and privileges in the taxation system. It will be noted, Mr. Speaker, that I did not use the term "tax dodging," since these were quite legal provisions contained in the Income Tax Act, but they were privileges because they allowed some taxpayers in higher income brackets to pay substantially less income tax or still to defer paying the income tax they should have paid immediately.
What will it mean for the average Canadian to remove from the tax system the preferences and loopholes? Well, first of all, we will be able to reduce significantly the marginal tax rates which apply to the taxable income at the end of the year when the time comes to assess the income tax. Therefore, there will be a significant reduction of the marginal tax rates. Also, the abolition of these preferences will allow a more generous federal 9 per cent tax credit. As you may recall, there was a $500 ceiling for the 9 per cent tax credit. From now on, Canadian taxpayers will be able to get a $200 tax credit which may be doubled if the spouse who earns no income does not file an income tax return. Which means that low and average income groups may increase their tax credits from $200 to $400. The third major element which we want to incorporate into our income tax system by eliminating a number of tax preferences is the possibility of escalating the federal income tax tables. Because these three objectives are very important for Canadian taxpayers, Mr. Speaker, I should like to examine what they really mean to them, since we have removed a number of loopholes from our tax system.

November 18, 1981
The Budget-Mr. Bussieres
For instance, the next time a Quebec taxpayer with three dependants-that is, his wife who has no gainful employment and two children-prepares his income tax return, he will have no tax to pay on his $15,000 income. Another Quebec taxpayer with the same responsibilities and an equal number of dependants, that is, three, and who earns $20,000, taking the escalation into account, will pay $425 less in income tax in 1982, which is extremely important, Mr. Speaker. I could go on and on giving examples that show the combined effect of the income tax table escalation, the marginal tax rate reduction-this rate which applies to taxable incomes-and the increase in income tax credit for low and average-income groups. I think, Mr. Speaker, that it is extremely important, to keep these figures in mind.
With your permission, Mr. Speaker, I should like to call the House's attention to a number of tables which appear in the budget papers. Hon. members will remember that the budget was tabled together with many budget papers; I suggest that one must have a look at these papers in order to understand the general thrust of the budget. For instance, if one considers the effects or the estimated impact of the tax measures on the income tax to be paid to the federal treasury, taking into account the escalation and the tax cuts, one realizes that lower income groups, that is, those earning up to $15,000, will see their income tax cut by 33.1 per cent, and the higher the tax rate, the lesser the tax cut. That is the example I gave earlier of the difference between progressive and regressive tax measures. A progressive tax measure-


Mr.   La Salle@: Mr. Speaker, on a point of order.


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


Mr.   La Salle@: Naturally, I And the minister's comments on the benefits for Canadians earning less than $15,000 most interesting. But could he add to that the list of indirect taxes which might come as a surprise for those same people?


The Acting Speaker (Mr. Ethier):: Order, please. Perhaps the hon. member could ask for that information during question period. I recognize the hon. Minister of State.


Pierre Bussières: Mr. Speaker, at least I am polite. 1 regret that the hon. member takes these opportunities-


Mr.   La Salle@: I was not criticizing!


Pierre Bussières: -perhaps not, but I still regret the fact that the hon. member should take this opportunity to show Canadians that he has not read the budget papers. With his permission-


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


Mr.   La Salle@: Mr. Speaker, I did not insult the minister. 1 simply asked him to add to his comments, which I find very interesting, the indirect taxes which taxpayers must bear.


The Acting Speaker (Mr. Ethier):: Order, please. The hon. member for Joliette has already had the opportunity to say what he is now saying. The hon. Minister of State for Finance.


Pierre Bussières: Although I do not have extended years of schooling, I do remember taking a course on how to learn. I recall our teacher saying that the lack of patience was the thing that hindered the learning process the most. So had the hon. member showed a little more patience he would have seen that I was just about to refer to the other benefits provided for in the budget. I will indicate to him that the table I am quoting from is on page 34 of the document "The Budget in More Detail", which I advise him to read-


An hon. Member:: Assuming one knows how to read!


Pierre Bussières: Of course, one must know how to and also have the patience to read. He will notice in the table the rates and benefits which were removed for some so that taxes are in fact increased for the higher income Canadians, and that is combined with indexation of tax tables and a reduction in marginal tax rates. That is why I say that these are progressive measures in that they benefit the low or moderate-income Canadians. Obviously, those who earn $75,000, $100,000 or more will have to pay higher taxes. Those who earn between $20,000 and $30,000 will benefit-


Sinclair McKnight Stevens: I rise on a point of order, Mr. Speaker. I too have been following the minister's speech with great interest. He referred to the table and I wonder whether he could clarify one thing. The table to which he referred states that indirect taxation of revenue will contribute 51 per cent more to the federal coffers. Could he explain why this is so?


The Acting Speaker (Mr. Ethier):: Order, please. Hon. members may seek information during question period.


Pierre Bussières: Mr. Speaker, the hon. member for York-Peel (Mr. Stevens) had an opportunity to speak about the budget yesterday. On this side of the House, members listened very carefully. Unfortunately, we were all disappointed because he said virtually nothing. I would appreciate it if he would allow me to concentrate so that I can inform Canadians of these important budget proposals.
We have seen that these proposals reduce significantly the tax burden of low and middle-income Canadians. I believe that it is extremely important to emphasize this, Mr. Speaker. Today in the House some members mentioned that the president of the Canadian Federation of Small Business had
November 18, 1981

expressed his disappointment at the budget proposals. During the pre-budget meetings chaired by the Minister of Finance, which I attended, we had an opportunity to meet with the Canadian Federation of Independent Business, and I have here the brief submitted by the Federation on September 14, 1981. The first suggestion to the government, as we can read on page 9 of the document, is, and I quote:
The expenditures of the federal government must be reduced.
Mr. Speaker, the first point I discussed was the government's formal commitment to reduce the rate of increase of its expenditures, deficit and borrowing needs. As we read on, we can see on page 13:
There is increasing concern about the problem of wage demands.
Under the theme "restriction", the Minister of Finance specifically invited all economic agencies to support his action to achieve restriction of spending and fight inflation. On page 14, under the heading "The cost of negligence", the matter of unemployment insurance premiums is dealt with. The budget proposes significant reductions of unemployment insurance premiums for both employee and employer.
The Federation of Independent Business suggested further measures, and yesterday my colleague responsible for small businesses gave a conference in Montreal where he went over the budgetary proposals which specifically concern small and medium businesses. I am convinced that all hon. members will agree that the assistance provided to small and medium businesses will prove a major boost toward job creation and economic recovery. I would like to mention very briefly the extension of the Small Business Development Bond program, which will help small businesses who are experiencing difficulty in coping with the present situation, to come through these hard times.
The second, the increase in-


Mr. Mazankowski:: I have a point of order, Mr. Speaker. I wonder if the minister could elaborate on the benefits to this House-


The Acting Speaker (Mr. Ethier):: Order, please. The minister has the floor.


Pierre Bussières: Mr. Speaker, I was referring to that second measure to help small business, namely, the increased limit for the low tax rate for small business corporations. There is also in the budget a third important measure-


An hon. Member:: You are misleading the people-


Pierre Bussières: Mr. Speaker, I hope the honourable member will have an opportunity and especially the courage to rise later on in this budget debate to express his views. In the meantime he will recognize this is a free and democratic country and I should be allowed to express my views. Therefore, the third measure, as I said earlier, is the reduction for employees and employers in unemployment insurance premi-
The Budget-Mr. Bussieres
um rates which are of major importance to small business. And I indicated that the Federation of Independent Business had insisted on this in their representations. Finally, the exemption of small business from the corporate surtax is also extremely important for small and medium businesses.
Mr. Speaker, I would like to say a few words about industrial renewal and the government proposals to that effect. Hon. members are aware that over the coming years, during the decade of the 1980s, important projects will be undertaken in Canada. Billons of dollars will be invested, particularly in resources. The government wants to create a favourable climate for economic development and a budget document titled "Economic Development" explains the government's development strategy. During the eighties, economic development will be dominated by two realities: the continued development of the resource-based industries and the revitalization of industrial capacity toward specialized international competitiveness.
These two forces will create a new regional dynamics and new growth opportunities within the different areas of the country.
It will be seen in the budget document on economic development that the government wants to ensure that every area- the strategy will allow all departments, as the DREE for instance-to benefit from investments in major resources.
My time is running short but I would be remiss if I were to conclude my remarks without referring to another aspect of the budget, namely the proposal of the Government of Canada with respect to fiscal arrangements between the central government and the provinces. We all know that it is an extremely important subject for the Canadian federation and I would like to mention briefly two of the main aspects of those arrangements. First, the equalization program and, second, what is known as the established programs financing. Under the equalization program, annual and unconditional payments are made to those provinces whose tax revenues are lower than the average and whose ability to finance their public services is lower than the average of the other provinces in Canada. In 1981-82, six provincial governments will receive equalization payments totalling nearly $4 billion. Quebec's share will be $2.1 billion, or slightly more than half the total amount paid this year to the six provinces which are entitled to equalization. The per capita amounts of those equalization payments Vary according to the tax revenues of the provinces.
Those per capita amounts range from $765 for Prince Edward Island down to $291 for example in Quebec. Those equalization payments are based on two factors. First, the taxing power of the various provinces, that is, the revenues each province would generate by applying the same tax rates on goods, transactions and income. Second, the equalization standard, that is the taxing power level a province reaches,

November 18, 1981
The Budget-Mr. Bussieres
after being eked out by the equalization payments. The proposals introduced by the Minister of Finance are aimed in the first place at extending provincial taxing power so that it will more adequately reflect their general potential combining wages, natural resources, real estate and other taxable items.
The second aspect deals with the equalization standard. The material dealing with tax arrangements suggests that the standard be set on the basis of tax yields in Ontario rather than on the basis of the average tax yields in all provinces as is the case at present. We know for instance that if we were to extend the taxation capacity without changing the equalization standard, transfer payments would increase to about $10.2 billion in 1982-83, of which $2.6 million would go to Ontario. Obviously, since we must restrain expenditures, the federal government cannot afford to implement such a program and especially to spend that kind of money. This is why we propose to substitute a new Ontario based standard.
Another aspect of fiscal arrangements is the financing of established programs. What is meant by established programs? These are in the areas of health care, hospitalization and financial assistance for post-secondary education. The budget does not propose any financial change in this specific regard. The purpose of such proposals to amend this program is to set a maximum amount per capita to bring about more equity in the financing of the established programs. It has been indicated that the government wanted to reduce its expenditures in the area of transfer payments to the provinces. This cutback will apply to a program which dates back to the tax reform of the seventies.
Following that reform of the Canadian taxation system, and as a result of the changes which were made in the tax system of the seventies and which reduced the amounts of money going to the provinces, what is known as the income guarantee was adopted. This was expressed either in tax points credited to the provinces, or cash payments to the provinces. We are now suggesting to the provinces that the income guarantee be removed from the over-all transfer payments made to them. That proposal follows the changes we have now made in the tax system, changes which I indicated a while ago in dealing with equity, which are known, by the way, either as tax preferences or tax privileges. The removal of these privileges, as we know, Mr. Speaker, will have a direct impact on the income of the residents of the provinces for whom the central government collects taxes, so that those provinces will see their revenue increase automatically as a result of the increases or changes in the new tax tables. Because we are increasing provincial revenues through changes in the taxation system, we are proposing to the provinces the removal of the income guarantee which had resulted from the changes made in the tax system, of the seventies.
Naturally, there is one special case and that is Quebec. This case is special in that, many years ago, its government chose to collect its own taxes and have its own tax system. We are now
suggesting to Quebec that a change be made in its tax schedules by doing away with the tax privileges we have removed. Hon. members will remember that, last week, the minister of finance for the province of Quebec published a study in which he said that the federal tax system provided for fiscal preferences and privileges which he condemned. The privileges which the Quebec minister of finance denounced we have now changed, so if he, who is sovereign in the field of tax collection-which is not the case for the ministers of finance of the other provinces since the federal government does the job for them-exercises hi& sovereignty in that field, the Quebec minister of finance can then increase his own revenue to more than make up for the amount of the guaranteed income provided for by the federal system.


The Acting Speaker (Mr. Ethier):: Order, please. I regret to interrupt the minister, but the time allotted to him has expired.


Mr. Dan Heap (Spadina):: Mr. Speaker, I have been looking forward to addressing you and my colleagues. Just three months ago yesterday, the Spadina voters sent me to this House rather than sending the man the Prime Minister (Mr. Trudeau) had chosen. The voters in Spadina indicated they had no confidence in his government, nor do they believe this government is willing to let the people of Spadina or the people in Canada earn an honest day's pay for an honest day's work, which is what people like to do.
Just this weekend people on the street in Spadina told me what they thought of this budget. They told me the budget was superficial, that it was mere tokenism and they believe the rich will go on finding loopholes no matter what. They mainly said there simply was no change and they wanted a change. In fact, they clearly sensed that this budget continues the policy of selling Canada; that is to say, selling the country they have built and putting it into the hands of people who do not care about the people who built it.
These are ordinary people. We have a great variety of ordinary people, working men and working women in Spadina. These are people who are trying to put a roof over the heads of their families, put a table under it and put food on that table. Having learned about it, they are finding this budget very discouraging.
In the land around Spadina we first of all had immigrants from the British Isles who were granted estates so they could control the lower orders as tenants. That did not work out so they turned into land developers during the housing booms in Toronto. They left us a few stately mansions on Beverley Street, Madison Street and places like that. They left us some very good narrow streets in the residential areas which keep the commercial traffic out. Then they went on to greener pastures, moved away elsewhere, but they still like to collect their revenues through the banks and other institutions which have the ear of the Minister of Finance (Mr. MacEachen), as shown by his budget.
November 18, 1981

Early in this century the eastern Europeans came to Canada, especially to Spadina. They created the famous Spadina needle trades district. There are many hundreds of small enterprises there that are still making and selling clothing and footwear, but they are threatened by this government. They are threatened not only by this government's hostile attitude to small business, but by the threat of the closing down of the present import quotas which so far have done something to protect them from the unfair competition of the southern United States and other very low wage, anti-union areas.
For example, today I had a telephone call from Mr. Marlen of Topaz Shoes who is already laying off employees because this government does not give him the assurance it will maintain the quota system which has so far protected his industry. He has built it up from 30 employees to 150 employees in three years. Now he is having to lay workers off because of this government's callous attitude toward the small-business men of Spadina and the rest of Canada.
We also have railway workers living in Spadina, some of them working in the Spadina yards. Some of them will not be working; they are facing lay-offs because of the cuts by this government in VIA Rail.
We have a great number of printing, office specialty and other small manufacturing outfits in Spadina, all feeling the threat of this budget, particularly whenever these small-business men have to consider their credit situation or bank loans.
After World War II many of those people moved north and we had more eastern Europeans, Quebecois, Newfoundlanders, Cape Bretoners and West Indians moving into Toronto. Italians and Portuguese came in particularly for the 30-year building and manufacturing boom, that boom which ended in 1975 with this government's wage freeze.
When I went to Toronto in 1954 to work in a factory I found Ukrainians, Italians, Newfoundlanders, Ontarians, Quebecois, and also I found those people working and living together in Spadina in peace, trying to raise their children, trying to fix their old houses and enjoying the music and the food of their ancestors and their neighbours.
Some of you may know of the Kensington market. That was a creation of the Spadina residential district just west of Spadina Avenue. It serves Jews, Portuguese, Philippinos, Chinese and many other nationalities. We also have the shopping districts along Queen Street, Yonge Street, Bloor Street and College Street, each with its own particular flavour.
Then came the Chinese. After City Hall had wiped out most of downtown Chinatown, the Chinese born in Canada and those emigrating to Canada built a new Chinatown around Dundas and Spadina. You can go up Dundas and along Spadina and find dozens and dozens of new Chinese restaurants. By the time you have eaten in each one of them there are several new ones built. They also have new stores, new offices, new theatres, new social centres and many new small businesses, most of which are also under the gun of the high
The Budget-Mr. Heap
interest policies of this government, continued by the present budget.
We have the University of Toronto, the biggest university in the Commonwealth. It is an excellent place of learning and research. It has thousands of professors and students and support staff, being one of the biggest employers in the city. Some of them live close by but many of them commute. Two of my daughters started there until they found they could get a better education for their purposes at Laval and at the Univer-site du Quebec in Montreal, but they still have warm memories of University College.
These people, from the president right down to the support staff and every student, are dismayed at the cuts being placed on them by the federal government as well as by the Tory provincial government. In spite of the sweet words of the minister, those cuts are continuing. He can juggle around guaranteed revenues and EPF, but the fact is that he is going to give less money and the province will give less. They have students now sitting in the aisles and trying to get into the lectures. I am told there is one lab that is now in the men's washroom. I am not sure whether it alternates day about between the men's and the women's washroom or how they observe equality in the matter. There was last summer, of course, the occasion of a wrestling match in Convocation Hall, about which Toronto people are aware.
Seriously, I have a letter from a graduate of the university who has been unable because of unemployment to repay his loan. He is being chased by a collection agency on behalf of this government. The interest now amounts to 23 per cent of the loan. This is how we discourage students and graduates of our universities. This is reversing what was undertaken in the 1940s and early 1950s when the government had a good program of assisting people to get to university under DVA.
We have many other people in Spadina. We have service workers of all kinds. We have women, many of them Portuguese immigrants-20,000 perhaps in Spadina and nearby- who clean the hospitals and office buildings downtown. We have the professionals who found that downtown Toronto is a livelier place to live than the frozen suburbs. What we have in Spadina is all manner of people earning their living in different ways, and all being threatened by this budget.
Before I outline the problems of the budget I have to acknowledge one other part of Spadina, a part which is not threatened by the budget. We also have in Spadina the banks, the insurance offices, the great financial houses, the head offices of the oil, mineral and paper companies with the commercial dukes and the barons who order this government around and control this country. The Spadina people know those buildings. They helped to build many of them. They are now cleaning them at nights. They work there as secretaries, as messengers and as bank tellers, many of them at minimum wages since most of them so far have been unable to organize unions. Many of them belong to families of which both parents must work. So the rosy picture of tax deductions for people who earn $15,000 does not apply to them. They must have two incomes in order to keep a roof over their head. They are

November 18, 1981
The Budget-Mr. Heap
getting no help from this budget for day care, no help of any kind for social services, and no help on family benefits if they fall into unemployment and get cut off by the harsh unemployment rules which are being developed.
Now they must renew the mortgages on their homes. According to the Minister of Finance, some 300,000 Canadians will be renewing their mortgages next year because they did not have a five-year mortgage. In other words, many of these people, certainly many in Spadina, listened to the banks who told them last year to take a mortgage for one year at 12 or 13 per cent because next year the interest rates would go down. Now they have to take another mortgage at twice the rate. The budget offers help to maybe 7,000, according to the minister's figures, out of those 300,000; they will get some relief, up to a maximum of $3,000. For most of these 300,000 people, there is nothing. If they are to pay the mortgage themselves, they must have about an additional $300 a month; and if they go on strike or take legitimate economic action to raise their pay, we will certainly hear from the other side of this House, and maybe from the extreme right of this House, a call for more wage freezes and union busting.
I would like to talk about the banks. The Minister of Finance and the minister responsible for housing have been telling us for several months that these bankers are reasonable. The Minister of Finance tells us that he talks with them every day and that they are compassionate. We read headlines which say how compassionate they are. In fact, the minister has said that he wants them to bleed a little bit.
Then we have the minister's little boy plea in his budget that he wants financial institutions, especially banks, to ensure that ample funds will be available to smaller borrowers at the lowest possible margin of cost. My father told me about bankers. He practised law in Selkirk, and Winnipeg for over half a century. Although he was a Liberal, he was a very fine and decent man.


Some hon. Members:: Hear, hear!


Daniel James Macdonnell Heap: These things happen! His clients were mostly low-income and middle-income people and many times he helped a client from his own pocket. He told me about this banker. This banker had had an automobile accident and lost one eye. He bought himself the very best glass eye that money could buy. He believed that nobody could tell the difference. One day a farmer came into the bank and asked for a loan. He did not have much collateral and the banker washed him out. As the farmer turned to leave the banker said, "Wait a minute, I will give you a sporting chance. If you can tell me which of my two eyes is the glass one, I will give you the loan." The farmer looked at him and said "The left eye is the glass eye." The banker said "You have it." and he wrote him out the loan. Then he asked the farmer: "Were you just guessing or did you really know which was the glass eye?" and the farmer replied "I knew. I looked at that left eye and I knew that it
had to be the glass eye because I just saw a glimmer of pity in it!"


Some hon. Members:: Hear, hear!


Daniel James Macdonnell Heap: These are the bankers into whose hands the Minister of Finance is once again putting the people of Spadina and Canada.
Returning to the budget, I listened carefully to the Minister of Finance and read over his text and some of his budget papers, and it really made me wonder at the things I heard and saw. There is really no tax relief for anybody earning under $25,000. There are a couple of gimmicks but they are cancelled out. Most of the people in Spadina earn well under that $25,000 limit. There is, however, a tax on health plans and on savings plans. Some people in Spadina thought that they should be thrifty and invest in those plans. The minister has told them that that is a mistake.
There is now to be a tax on the money that hard working immigrants in Spadina send to their relatives overseas, with the exception of a spouse and children. For a century this country has invited and even paid the passage of people to come here to do the hard, dirty and low-paying jobs in this country. The only reason many of these people came was that it was the only way they could help their families back home. The government is now telling them that they are trapped here and they can only help their mother or sister or brother if they are here. If they are back home there is no help, as far as the Minister of Finance and his tax laws are concerned.
There is no relief for single parents under the provisions of this budget. We have heard a long, complicated story from members opposite about how someone with a wife and children who is earning $15,000 will pay no tax. It does not help the single parent and there are many in Spadina. There are many cleaning women who work in the hospitals and other buildings who are the sole support of their children. Some 84 per cent of single parents are women and many of them are in Spadina. They receive low pay, about $ 11,000 on the average, whereas the men earn $18,000. There is no relief for them, no help with further day care and there is no help with further family benefits when they cannot hold a job any longer.
There is no serious relief for home owners. In fact, the interest rates have been kept up and the paltry subsidy arrangement which the Minister of Finance has put forward really only subsidizes the banks, shuts the mouths of their loudest critics and helps the banks keep their interest rates high. The Minister of Finance is subsidizing the banks who now have 48 per cent more profits than they had last year.
There is little help to small business. The federal business development loans have very complicated rules and businessmen in my riding tell me that very few of them are able to qualify.
There are cuts in social services which again are denied by the minister but recognized by everyone else who has examined the budget. The seven-year-old promise by the Prime Minister to provide money for urban transit still goes absolute-
November 18, 1981

ly unredeemed and Toronto has now had to put its transit fares up by 10.6 per cent with no help coming from the Prime Minister as he promised.
There is no serious job-creation program. There are perhaps 2,400 jobs coming in rural parts of the maritimes and in Ontario where the government wishes to take advantage of low wages and non-union conditions. According to the minister's predictions, unemployment will rise during the next two years and real wages will fall. Yet he is preaching restraint to the poor.
He opened his budget speech with a little sermonette which tells working people not to ask for more money. In effect, what he has said is that anybody who asks for more pay is doing his or her fellow worker out of a job. That is a very cynical and misleading sermon from one who is protecting his buddies, the bankers.
Real wages have been falling behind prices since 1978 and they are projected to fall even further; but the big five in the banks have increased their profits by 228 per cent in ten years and they are up 48 per cent this year. The cost of living goes up and up, the cost of food goes up, but the minister does nothing about it. Canada is exporting more raw food every year and importing more processed food every year. Many people in Spadina like to eat and the food bill goes steadily up.
Farms are disappearing in this country. The farming population 30 years ago was 16.8 per cent of the total population and, as of 1976, it had dropped by two-thirds to 5.1 per cent. Canada is at the point of becoming a country which does not produce enough for its own people to eat. I never thought I would live to see the day when Canada could not feed its own people.
The prices of heating oil and gas are predicted to go up by about $500 to $600 for the average family. That doubly wipes out the tax credit for low-income people about which the minister has talked.
However, what I am most concerned about is what will happen to the hundreds and thousands of people in Spadina who have been earning their living as factory workers and who face being laid off. I am thinking of Tony and Silvio from Italy with whom I worked in a box factory. I am thinking of Joe from Poland. I am thinking of Dave from Newfoundland. I am thinking of a great many others. There were also women in our factory. There was Anna Lisa from Germany. These people were all laid off at the beginning of the year. The box plant which had operated for over half a century was bought by MacMillan Bloedel, which was then bought by Noranda, which was then bought by Brascan. All that high level financial dealing was assisted by the tax write-offs this government created in previous budgets and which this budget continues. The effect of this wheeling and dealing in high finance has been to cause unemployment among the men and women with whom I worked for 18 years. These are middle-aged people with seniority they earned in their plant, and now some of them are out on the street. Some of them have temporary jobs.
The Budget-Mr. Heap
Some of them are starting in new places. They are middle aged and have no seniority. They have no protection against further lay-offs. This has been promoted by the previous budgets of this government and is continued by the present budget.
The Minister of Finance has no serious program for relocating phased-out workers. There is no serious retraining program. George Brown College has had to cut back its technical courses because the funding from this government has been progressively cut back for several years and is to be cut back further by this budget. There is no decent program of severance pay for workers laid off after years of service.
However, on the other side of the budget there are goodies for the rich. There is no excess profits tax levied against banks. The rate of taxation for people earning $100,000 and over has been reduced from 65 per cent to 50 per cent. That is quite a bonanza. We are told that loopholes are being closed, but income exclusion, which accounts for half the tax evasions, has not been touched. Capital gains have scarcely been touched. Capital gains cost this country half a billion dollars last year. Income exclusions cost the country over $6 billion last year. Almost $7 billion in exclusions which go almost entirely to people earning more than $100,000 a year have not been touched by the minister in spite of his trumpeting about an equity budget and tax reform.
Why do we have this pattern of injustice? I do not agree with those who suggest that the minister was careless, ill-informed, stupid or thoughtless. I think he is a very thoughtful man. I think he has a plan, so I looked at his booklet entitled "Economic Development for Canada in the 1980s". There I think I found the explanation for the hard fist he is swinging at workers. The fact is that Canada in the eighties and nineties is a place where this minister apparently does not think we will need workers. He does not think we will need men and women with some maturity, some training, some adaptability or responsibility. He does not think we will need men and women who are willing to work, to acquire skills, to organize in their unions for steady working conditions or to raise their families and build their communities. The minister does not think we need those people. Instead, he wants specialized migrants who will roam around the country and work on the projects his friends, the bankers, have decided they like.
For example, I refer to projects in the north, most of which are for construction, transportation and resource extraction. In the next five years $60 billion-about $1,200 per year from every Canadian man or woman who is working-will be given by this government to finance resource production and bulk shipments. This applies to 42 projects. There will be oil and gas pipelines to bring oil and gas, the minister says, to eastern Canada, but just as likely they will be going to the eastern United States. This transportation will mainly be for shipping Canada out. There will be bulk shipments for the export markets.
Coal shipments will be up 125 per cent, mostly to Japan. Fertilizer shipments will be up 78 per cent. But grain shipments will be up only 38 per cent, and shipments of all other things, including manufactured goods, will be up only 48 per

November 18, 1981
The Budget-Mr. Mazankowski
cent. In other words, we are going to kill VIA Rail passenger service for the sake of digging Canada up and shipping it out so that other people can use it.
The arms budget is going up 17 per cent or 18 per cent this year. At that rate that will mean nearly $40 billion in five years, or about $1,600 for every man, woman and child in Canada-for death.
The food industry is being geared to exports, while our prices rise and the farmers quit. Manufacturing is to be slighted. The minister is rejecting protectionism, and that is his phrase. He is carrying on a dialogue with the major Canadian corporations in which he does not mention the unions. He has handed over the textile industry to a set of financiers who have no interest whatsoever in protecting the jobs of textile and shoe workers. The minister has killed the Foreign Investment Review Agency or, at least, chloroformed it. He has said that foreign capital and technology will continue in Canada. In whose interest? What he says in his budget is that the Government of Canada is fully committed to promoting the mobility of resources-money and workers-and that is the clue. The minister wants to remove all protection from those who are not among the strongest. He wants to be able to hand over our natural resources and our labour to the strong so that they can dig Canada up and ship it away.
A few years ago the late John Diefenbaker said that Canada was becoming a banana republic. He was partly right. The trouble is that we are becoming a banana republic, but we will not even have the money to buy the bananas.
We are left asking whom the minister serves. Is it the New York money lenders who dictated these political terms, as they dictated the wage freeze of 1975? In one of his booklets the minister hints that if wage demands go too high we may have to do something about it. It is a very gentle hint, but we will hear more about that in the months to come.
This budget is something the late General McNaughton warned us against 30 years ago when he said we would become hewers of wood and drawers of water. In fact, this budget goes hand in hand with the constitutional package the Prime Minister brought to us two weeks ago, which is an attack on the fundamental rights of Canadians and most blatantly those of women, the French community in Canada and the native peoples. This is a budget for using cheap labour and for using those three groups to undercut the labour of those who are not in those groups. In other words, this budget is a male budget; it is a white budget; it is an anglo budget. It is an affront to the people of Canada, and it should be rejected by this House.


Donald Frank Mazankowski: Mr. Speaker, I want to begin by saying that in my thirteen years as a member of the House of Commons I have never witnessed a situation where a budget has been so universally condemned. I think it is fair to say that this budget takes from the poor to help those in financial distress. I would have hoped that the Minister of State for Finance (Mr. Bussieres) would have attempted to clarify some of the points contained in the budget. For example, 1 hoped the minister would set out to explain what is meant in the budget by "firms in financial difficulty" and "farmers in financial distress." In the government's defence of the continuation of the Small Business Development Bond, those riders are crucial. As of today, I understand that banks are sending out notices to the effect that the Small Business Development Bond, as of November 12, will not be issued until there is further clarification.
In this budget the government has treated inflation as public enemy number one, yet at the same time it sets out to blame everyone but itself and asks everyone to share in the burden of restoring sanity with regard to inflation. It does not address itself as a major contributor, nor does it address itself as one that can aid in assisting the decline of inflation in this country. The budget was expected to set a new course for economic recovery, economic strategy, if you like, to renew confidence in the business community, to stimulate production and thereby generate wealth. If one examines the document "Economic Development for Canada in the 1980s", one would observe that it consists of a recitation of rhetoric and bureaucratic jargon.
Canadians expected this budget to address the very critical issues that face the average Canadian from coast to coast, namely, the problems for home owners of mortgages and high rents, the problems affecting small-business men, which is one of the most important components of Canada's economy, the farmers, the low-income sector, senior citizens, the unemployed, particularly those unemployed as a result of an inadequate housing policy and an inadequate industrial strategy, the construction industry and the manufacturing and oil sectors of our country. In other words, there was nothing in the budget for the average Canadian. It did not really address any of the major problems that face Canadians.
In the name of restraint, this government increases its spending by 22 per cent. In the name of equity and fairness, it squeezes another $1.4 billion out of Canadian wallets; and in the name of economic renewal, it does not do anything. It is not even a clever budget. It is a deceitful budget. Upon close examination of the budget, one will clearly see that it will impose and inflict further hardships upon the average Canadian. It really is a cop-out. In my view, it is a budget which will be destructive, as we examine it in more detail.
Now we have the Minister of Finance (Mr. MacEachen) repairing and tinkering. As far as I am concerned, no amount of repairing and tinkering will make this budget an acceptable document. What I recommend to the Minister of Finance is that he withdraw this budget and send it back to the drawing boards-


Some hon. Members:: Hear, hear!


Donald Frank Mazankowski: -so that he may reassess the precarious state of the country, and then introduce a realistic budget that will address the economic needs of the average Canadian. When one studies this budget and examines the situation that faces the Canadian people from coast to coast, one can only conclude that this government is hopelessly out of touch.
November 18, 1981

In this country we have a 20-year low in consumer confidence. We are in the midst of a recession, if not a depression. There are approximately one million unemployed; we have crippling interest rates; an inflation rate of 12.7 per cent that will probably rise to 13 per cent within a month or sixty days; staggering gasoline prices that have risen by 75 cents a gallon since the Liberal government assumed office; record heating oil prices, an increase of some 50 cents a gallon since the government assumed office. Federal taxes now imposed by this government exceed two times the 18-cent excise tax that was imposed by the Crosbie budget, and at the same time there is no relief for the home owner, for the low-income earner, for the senior citizen, for the farmer or the small-business man. As far as I am concerned, Mr. Speaker, as one who has been associated with the small business and small manufacturing sector in this country, I can tell you that there is no mood of optimism in this country today, no optimism for the productive core of this nation and there is no hope for the unemployed.
The productive capacity of our economy has never been in such peril. Never has the government done so little to stimulate growth in the productive sector. It could be said that this budget constitutes a cynical attack upon the productive core of our economy. Because the government is faced with rampant and largely made-in-Canada inflation, trying desperately to cope with the effects of a largely made-in-Canada high interest rate policy and observing real incomes continue to decline, Canadian workers, farmers and fishermen look to this government for leadership. What do they have? They have a budget that offers no relief but instead will squeeze another 22 per cent increase in direct personal taxes out of their households in the coming year.
What did Canadians expect in regard to the stimulation of growth and development? All we have received in this document entitled "Economic Development for Canada in the 1980s" is a litany of government agencies and an additional squeeze of 30 per cent in direct taxes in the coming year.
What about government leadership in the area of restraint? Did the government hold the line or curtail its own spending? No; it has increased its expenditures for the coming year by over 22 per cent. This offers Canadian families and businessmen an extra dose of inflation for the coming year.
What about indirect taxes? For the average worker, hidden taxes have doubled from the day the Minister of Finance assumed his office. When the minister assumed office there were hidden taxes of roughly $100 per worker, per month; that has now doubled to $200 per worker, per month. That is the kind of attack that we have on the workers of this country.
This morning I was advised that in addition to the vicious attack on the employees of VIA Rail, some 1,600 who will lose their jobs, we now find as a result of the budget that the termination benefits cannot be rolled over into RRSPs. Therefore, the retirement benefits will be taxed more heavily than would have been the case. To add insult to injury, these workers who have lost their jobs will now face regressive measures in this budget.
The Budget-Mr. Mazankowski
Farmers and small businessmen also will have their retirement plans disrupted as a result of the discontinuance of the income-averaging annuity.
The heartless and cynical government that has introduced this budget, one that is based on a commitment of restraint and yet only restrains the economic well-being of Canadians, will, in essense, take more revenue and spend at record levels itself. It presents a budget that is supposedly based on equity which, in fact, serves only to redistribute the burden and consequences of government mismanagement among the Canadian public and completely off its own shoulders. It presents a budget with an overriding theme of economic renewal which, in effect, is an attack upon our productive core and will only serve to make our productive sector less productive and more dependent upon government.
When one studies this document, one will find, as I said earlier, that it ignores the fundamental responsibility of encouraging growth and development in this country. In order to have national wealth and prosperity, we must have production and growth both on a national basis and on a per capita basis. What we have here is the fundamental difference between real gross national product and perceived gross national product through the growth of government bureaucracies. That is what we see in this document.
The fact of the matter is that the budget will stymie the productive sector because of the advent of further bureaucratic devices which are enunciated in this particular document. It will stymie and inhibit production rather than encourage it. The gross national product that will occur as a result of the initiatives undertaken in this particular document will largely be an illusion.
The document entitled "Economic Development for Canada in 1980s" was predicated upon a recently published task force report entitled "A Report by the Major Projects Task Force on Major Capital Projects in Canada to the Year 2000" that identified a number of potential projects which can and should be developed over the next 20 years. But the document did nothing to outline a suitable framework or a positive economic environment for these things to happen. On page 7 the document reads:
We must carefully examine our regulatory systems to ensure that the rules are clear and the procedures efficient, so that they guide business enterprise rather than inhibit it.
I interpret this to mean that the government is proposing a scaling down of regulations and bureaucratic obstacles. It should be facilitating rather than obstructing. That is not the spirit and thrust of the document. Therefore, it rejects the report of the Economic Council of Canada which identified the many billions of dollars it is costing the country because of the excessive amount of regulation.
It is important to have stability and certainty. For example,
I am certain the construction industry is not very happy with the sudden changes and shifts in policy enunciated in the budget. Neither is the manufacturing industry, which is

November 18, 1981
The Budget-Mr. Mazankowski plagued with lay-offs. The fact of the matter is that at least 20,000 rental units are affected directly. The minister brought in some changes, but upon reflection and closer examination one will find that there are still serious problems as a result of the minister's announcement yesterday. I am sure my colleagues will document that later.


Mr. Huntington:: Very, very serious.


Donald Frank Mazankowski: 1 hear the hon. member for Capilano (Mr. Huntington) saying "Very, very serious."
Page 14 of the document indicated the following:
As an initial response to the Report of the Major Projects Task Force, the Government of Canada has established a new Office of Industrial and Regional Benefits.
This is more bureaucracy. What will they do? They will co-ordinate and interact. Page 16 refers to the IOP, the industrial opportunities program, and reads:
To meet the needs of Canadian business in a co-ordinated, effective manner, the Government of Canada will draw together these programs under a new Industrial Opportunities Program (IOP).
This is another mechanism which will necessitate the creation of more jobs for Liberals. At the bottom of page 16 it refers to the establishment of the Canadian Industrial Renewal Board as follows:
The Canadian Industrial Renewal Board is being established to co-ordinate the federal government's industrial adjustment programs in the clothing, textile and footwear sectors.
This is an appointment of some 16 people across the country, all of whom are Liberals, for the purpose of receiving their famous reward. There is only one individual out of the 16 who has had any textile experience. Page 20 refers to the establishment of the Export Trade Development Board. All we have in the document is a proliferation of boards, agencies, advisory councils, Crown corporations and task forces.


The Acting Speaker (Mr. Ethier):: It being 5.45 p.m. it is my duty pursuant to Standing Order 60(7) to interrupt debate and put forthwith every question necessary to dispose of the amendment now before the House.

The question is on the amendment (Mr. Wilson). Is it the pleasure of the House to adopt the amendment?


The Acting Speaker (Mr. Ethier):: In my opinion the nays have it.
And more than five members having risen:


The Acting Speaker (Mr. Ethier):: Call in the members.


Some hon. Members:: Agreed.


Some hon. Members:: No.


The Acting Speaker (Mr. Ethier):: All those in favour of the amendment will please say yea.


Some hon. Members:: Yea.


The Acting Speaker (Mr. Ethier):: All those opposed will please say nay.


Some hon. Members:: Messrs.
Dingwall	Gendron	LamontagneDion	Gimaiel	LandersDionne	Gingras	Lang(Chicoutimi)	Gourd	LanielDionne	(Argenteuil-Papineau)	La pier re(Northumberland-	Gourde	LapointeMiramichi)	(L6vis)	(Charlevoi)Dubois	Gray	LapointeDuclos	Guilbault	(Beauce)Dupont	Harquail	LeBlancDupras	Henderson	LeducDuquet	Hervieux-Payette	LefebvreErola (Mrs.)	(Mrs.)	LoiselleEthier	Hopkins	LonsdaleEvans	Hudecki	LumleyFerguson	Irwin	MacBainFisher	Isabelle	MacEachenFleming	Johnston	MacGuiganFlis	Joyal	MackaseyFoster	Kaplan	MacLarenFox	Kelly	MacLellanFrancis	Killens (Mrs.)	MaiepartFrith	Lachance	MaltaisGarant	Lajoie	MarceauGauthier	Lalonde	Masse
The Budget-Mr. Mazankowski
Messrs.
Masters	Pinard	SchroderMcCauley	Portelance	SimmonsMcRae	Prud'homme	SmithMunro	Regan	Tardif(Hamilton East)	Reid	TessierNicholson	(Kenora-Rainy River)	Tobin(Miss)	Roberts	TousignantOlivier	Robinson	TrudeauOstiguy	(Etobicoke- Lakeshore)	TurnerOuellet	Rompkey	VeilletteParent	Rooney	WatsonPelletier	Rossi	WeatherheadPenner	Roy	WhelanPepin	Savard	Yanakis-144.Peterson	[Translation]


Madam Speaker:: I declare the amendment lost.
It being after six o'clock, I do now leave the chair until tomorrow at 2 p.m. pursuant to Standing Order 2(1).
At 6.19 p.m. the House adjourned, without question put, pursuant to Standing Order.


END OF VOLUME XI